Law Practice Essentials

If you have unpaid fees and disbursements, you should consider whether to enforce a solicitor’s lien. A solicitor's lien is a legal right to retain possession of a client's property until the lawyer's account has been paid, whether or not the property came into the possession of the lawyer in connection with the matter on which the account is owed. The lawyer may retain property other than money that has a value in excess of the amount owed, but may not retain money in excess of the amount due. The lawyer may not dispose of or deal with the property that is the subject of the solicitor’s lien without a court order. 

A lawyer's assertion of a solicitor's lien is subject to Code of Conduct Rules 3.7-6 and 3.7-7. When determining whether to enforce a solicitor’s lien, the lawyer should consider:

• whether the client will suffer serious consequences without the file; 
• the client’s ability to pay; 
• the fairness of the fee agreement or the client’s understanding of it; and 
• whether any prejudice to the client can be mitigated by means other than the return of the file. 

You must also consider the impact of enforcement of a solicitor’s lien on the client’s position. You should not enforce a solicitor’s lien if: 

• enforcement would materially prejudice the client’s position in any uncompleted matter;  
• the client is prepared to enter into an arrangement that reasonably assures you that you will be paid in due course; or
• the new lawyer agrees to pay your outstanding account from the money ultimately recovered by that lawyer. 

As noted above, you cannot enforce a solicitor’s lien if enforcement would materially prejudice the client’s position in any uncompleted matter. It is important to note that “material prejudice” is more than mere inconvenience to the client. Analysis of prejudice also takes into account the client’s ability to pay. If the client can pay an outstanding fee, they should do so in order to obtain their file from former counsel. If the client feels they have overpaid or the fee is excessive, they may pursue an adjustment of the bill and a refund by making an application for a review and assessment. 

Depending on the circumstances, you may be entitled to claim a lien on the whole file. In others, you may have an obligation to provide all or part of the file to avoid material prejudice to the client. It does not materially prejudice a client to withhold a document which the client or the new lawyer can obtain from another source.

To aide in the smooth transfer of a contingency fee file, the lawyers may agree to divide the contingency fee based on an apportionment of total effort required to effect recovery.

If you have questions about your obligations when considering enforcement of a solicitor’s lien on one of your matters, you may wish to consult a Practice Advisor.