In Ellis v John Hodge Solicitors (a firm)  EWHC 2284 (Comm) the claimant former client had originally instructed the defendant solicitors in a personal injury claim. Following a dissatisfactory result, where an offer of £200,000 was rejected but only around 10% obtained by way of judgment, the claimant filed professional negligence proceedings against his solicitors. The claimant requested disclosure of the client file which the defendant solicitors declined on the grounds that they were exercising their common law lien for unpaid fees. The Court had to consider whether a solicitors’ lien takes precedence over the parties’ disclosure obligations pursuant to the Civil Procedure Rules.
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Background to the Professional Negligence Claim
John Hodge Solicitors (“the solicitors”) is a firm who claim to have ‘extensive experience’ and ‘specialist personal injury expertise’. David Ellis (“the claimant”) was injured in an accident at a restaurant in Minehead and instructed the solicitors to act for him in respect of his injuries (“the personal injury claim”). Several offers to settle were made; the instant professional negligence claim arose as the claimant argued that the solicitors failed to warn him firstly, of the consequences of turning down the settlement offers and secondly that the court may look at the Defendant’s expert evidence more favourably than that on his behalf. The solicitors in turn counterclaimed against their former client for their unpaid fees.
The defendant in the personal injury claim made several offers, the highest Part 36 offer totalled at £200,000 however the claimant sought to recover an amount over £500,000. In the end, the personal injury claim led to an award of damages to the claimant in the sum of only £11,815.63.
The claimant subsequently brought a claim for damages due to professional negligence on the basis that the solicitors failed to properly advise him on the effect of the offers made by the defendant in the personal injury claim, specifically, the risk of expert evidence for the defendant in the personal injury claim being preferred to that of the claimant.
The solicitors’ basis for defending the claim was that the claimant was, in fact, correctly warned of the risks in the personal injury claim as well as the potential consequences of failing to beat offers made by the Defendant restaurant.
The solicitors told the court that they were unable to provide initial disclosure due to the firm having exercised a common law lien over its file on the grounds of unpaid fees. The solicitors did however offer to disclose the file to the claimant’s new solicitors upon an undertaking not to disclose it to the claimant and to later return the file, pursuant to the decision in following Robins v Goldingham  LR 13 Eq. 440. This is commonly referred to as a Robins undertaking.
Issues and the Relevant Law
The issue for HHJ Pearce to decide was whether a solicitors’ common law right to a lien by virtue of their unpaid bills could restrict the scope of their disclosure obligations under the Civil Procedure Rules (“CPR”). Simply put, if, due to the common law lien being in place, the solicitors could avoid disclosing the client file.
The law in respect of the exercise of a solicitor’s lien over a client’s file was considered and summarized by MacBride J in Donaghy v JJ Haughey Solicitors  NI Ch 1, a case which was referred to by the solicitors in their Defence pleadings and HHJ Pearce in his judgment in this case at Paragraph 10:
i) Subject to any agreement to the contrary, a solicitor has a common law right to exercise a general lien in respect of his costs on any property belonging to his client which properly comes into the solicitor’s possession in that relationship. As Moore-Bick J put it in Ismail v Richard Butler  2 All ER 506, “The basic rule is that a solicitor has the general right to embarrass his client by withholding papers in order to force him to pay what is due and the court will not compel him to produce them at the instance of the client.”
ii) Solicitors as officers of the court are subject to its supervisory jurisdiction and the court can therefore interfere with the enforcement of the common law lien on equitable principles.
iii) Where it is the solicitor who terminates the retainer, the court will normally make an order obliging the original solicitor to hand over the file to the new solicitor against an undertaking by the new solicitor to preserve the original solicitor’s lien (a so-called Robins undertaking, following the decision of Malins VC in Robins v Goldingham (1872) LR 13 Eq 440);
iv) Where the client terminates the retainer, this is a weighty factor against interfering with the exercise of the lien, but the court retains the power to do so on equitable principles;
v) When invited to interfere with the exercise of the lien, the court should make the order which best serves the interest of justice, in particular weighing the risk that the client would be deprived of material relevant to the conduct of the case and might thereby be “driven from the judgment seat” if the lien is sustained against the principle that litigation should be conducted with due regard to the interest of officers of the court, who should not be left without payment for what is justly due to them.
vi) In determining the appropriate order, the court should have regard to all of the circumstances of the case, including, in particular:
a) When and why the solicitor/client relation ended;MacBride J in Donaghy v JJ Haughey Solicitors  NI Ch 1
b) Who ended it;
c) The nature of the case;
d) The stage that the litigation had reached;
e) The conduct of the solicitor and the client respectively;
f) The balance of hardship which might result from the order that the court is asked to make.
g) The fact that the value of the lien is likely to be considerably reduced if the file is handed over.
Decision and Case Highlights
This case provides guidance on how the law deals with disclosure obligations and solicitors’ liens. The judge decided that in order to judiciously and fairly deal with the claim, the files had to be disclosed as they were central to the issues in the claim. His Honour also noted that a Robbins undertaking would be a futile exercise as the claimant would have needed to know what file notes said in order to deal with the issues so ‘the lien would lose its value just as much as if he saw the documents themselves’. The judge went on to state that even in relation to the solicitors’ counterclaim for unpaid fees, there was a risk of prejudice to the claimant if the files weren’t disclosed.
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