The Ghost Client

You get back from lunch to find a genial middle-aged gentleman in your waiting room, apologizing for just dropping in, but wondering if he might have a few minutes of your time to see if you could help him. You oblige, usher him into your office, where he lays out his plans for a ten-unit apartment building in a designated area of town. You look it all over and congratulate him on what seems to be a well-considered notion and suggest he stop with reception and book an appointment.

You hear no more from him until a day short of two years later when the bailiff shows up and serves you with a court claim alleging professional negligence. In the claim, the genial middle-aged gentleman sets out that you agreed to act for him, failed to advise of the strict timelines for municipal approval, and failed to file a timely application for a grant to build in the designated area. He had to abandon the project with significant thrown-away costs, as well as potential profits. He also seeks punitive damages.

You send the claim to your errors and omissions insurer, who asks for your file.

You have no file.

Oh.

Well, do you have a memo of the meeting?

No.

Oh.

You know how this will end, don’t you?

If the foregoing story had ended with, “Oh, yes, here’s a memo I wrote after the gentleman left. See, it says here that I told him that I was not going to be his architect until we had a signed agreement, I sent him home with an engagement agreement to sign and bring back with a cheque and all his sketches. All in the memo. A month later we sent out our pro-forma “no engagement” letter. Here it is in the file. And after that, we never heard from him again.”

Which one do you want to be your story?

The moral is simple– every interaction which occurs in your office or out (eg, a party) where it reasonably appears that someone is speaking to you in your professional capacity, even on a tentative basis, should be recorded at the earliest opportunity and filed.

You work too hard for your money– don’t give it away on E&O claims.

(Excerpt from The Alignment Doctrine)