Depends what it says. If it's a letter before action, it might be as well to reply to it! It's usually best to acknowledge it and give your side, in any case, if you deny the claim or it is based on a false understanding of the facts, so the solicitor, who has only got what the client says to go on, can see that and will go back to the client and get instructions. Once they see what you say, they may tell the client that there is no case and they'd better save their money. If in doubt about the effect of your reply, head it "Without prejudice" so it can't be used in evidence.