Lawyers Held Not Entitled to Withdraw Despite Not Getting Paid

Lawyers who represent clients in litigation often assume that they can simply withdraw from the case if the client stops paying the lawyer’s bills. Engagement letters and representation agreements often provide that an attorney will withdraw in the event of nonpayment. A federal court sitting in Richmond, Virginia, however, denied a law firm’s withdrawal request in such a situation, demonstrating that lawyers representing corporations in Virginia’s federal courts cannot assume they will be released from their litigation duties when their clients are being uncooperative–even if their clients are not paying the lawyer’s bills.

In Reynolds v. Reliable Transmissions, Inc., the law firm of ThompsonMcMullan, P.C., filed a motion to withdraw from its representation of the defendant. The grounds of the motion were typical: the client failed to make the required fee deposit, failed to pay the law firm’s bill, and failed to respond to the lawyers’ efforts to communicate about the case. The law firm filed its motion early in the case: no discovery had taken place, and no trial date had been set. The posture of the case was such that most lawyers would consider a court’s granting of the motion to be fairly automatic. After all, the Virginia Rules of Professional Conduct expressly permit withdrawal where “the client fails substantially to fulfill an obligation to the lawyer regarding the lawyer’s services,” provided that court approval is obtained. The plaintiff did not even oppose the motion.

Judge Dohnal explained, however, that nonpayment of feescourthouserichmond.jpg is usually not a sufficient basis, standing alone, to permit an attorney to withdraw from pending litigation in the absence of another attorney ready to take over the case. In Virginia state and federal courts, corporations must appear by counsel; they cannot represent themselves. For this reason, and because no other attorney had been identified to assume the representation, the court denied the motion to withdraw.

The result might be different, the court noted, if there were individual defendants remaining in the case whose interests were aligned with the corporation. The law firm in such a situation would likely be permitted to withdraw because individuals may appear pro se (i.e., represent themselves) and would likely address (at least indirectly) the interests of the similarly-situated corporation.

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