Treacy v Roche

• Jurisdiction: Ireland
• Judge: Miss Justice Laffoy
• Judgment Date: 27 February 2009
• Neutral Citation: [2009] IEHC 103
• Court: High Court
• Date: 27 February 2009

[2009] IEHC 103

THE HIGH COURT

[No. 16429 P/2001]

Treacy v Roche

BETWEEN

PAMELA TREACY

PLAINTIFF

AND

LEN ROCHE AND HILARY ROCHE

DEFENDANTS

MULHEIR & ARNOLD v GANNON T/A CLAFFEY GANNON SOLICITORS UNREP LAFFOY 17.7.2006 2006/42/8892 2006 IEHC 274

AHERN & ORS v MIN FOR AGRICULTURE & ORS UNREP LAFFOY 11.7.2008 2008 IEHC 286

ISMAIL v RICHARDS BUTLER (A FIRM) 1996 3 WLR 129 1996 QB 711 1996 2 AER 506

GAMLEN CHEMICAL CO (UK) LTD v ROCHEM LTD (NO 1) 1980 1 WLR 614 1980 1 AER 1049

SILVERTOWN LAW OF LIEN 1988 47

SOLICITORS (IRL) ACT 1849 (UK)

GALLAGHER SHATTER & CO, STATE v DE VALERA 1986 ILRM 3 1984/7/2212

SOLICITORS (AMDT) ACT 1994 S8

SOLICITORS (AMDT) ACT 1994 S9

RSC O.99 r14(E)

LAW SOCIETY A GUIDE TO PROFESSIONAL CONDUCT OF SOLICITORS IN IRELAND 2ED 2002

SOLICITORS (AMDT) ACT 1994 S8(4)(A)

RSC O.99 r15

PROFESSIONS

Solicitors

Legal representation - Order directing former solicitors to transfer file to new solicitors sought - Former solicitors seeking security for fees as condition precedent to transfer of file - Former solicitors maintaining retainer constructively terminated by plaintiff's refusal to heed legal advice - Plaintiffs seeking to pursue case of professional negligence against other solicitors - Whether plaintiff or former solicitors terminated retainer - Whether termination of retainer for reasonable cause - Whether exceptional circumstances required security for costs already accrued - Whether constructive termination of retainer a concept known to Irish law - Mulheir v Gannon [2006] IEHC 274 (Unrep, Laffoy J, 17/7/2006), Ahern v Minister for Agriculture [2008] IEHC 286 (Unrep, Laffoy J, 11/7/2008), Ismail v Richards Butler [1996] 3 WLR 129, Gamlen Chemical Companu (UK) Ltd v Rocham Ltd [1980] 1 WLR 614 and State (Gallagher, Shatter & Co) v de Valera [1986] ILRM 3 considered - Attorneys and Solicitors (Ireland) Act 1849 - Solicitors (Amendment) Act 1994 (No 27), ss 8 and 9 - Rules of the Superior Courts 1986 (SI 15/1986), O 99, rr 14 and 15 - Application for security for fees refused (2001/16429P - Laffoy J - 27/2/2009) [2009] IEHC 103

Treacy v Roche

Facts: The plaintiff was the daughter of the testatrix and the defendant solicitors were the executors of the will. The plaintiff sought an order directing the former solicitors to deliver all files, documents and papers to new solicitors. Proceedings had been commenced in 2001 and were reconstituted. The former solicitors were no longer happy to act for the plaintiff on account of a professional negligence allegation made against the defendants qua solicitors. The plaintiff made a complaint to the Law Society about the conduct of her affairs by the former solicitors and sought the transfer of papers to her.

Held by Laffoy J. that an order would be granted referring the bill of costs delivered by the former solicitors to the plaintiff for taxation. There would be an order directing the plaintiff to take all reasonable steps to facilitate the taxation process subject to an undertaking to the new solicitors to receive inter alia all files, documents and papers, to preserve the lien over those items, to notify the former solicitors when proceedings were finalised and to prosecute the proceedings in an active manner. The Court would make an order referring the bill of costs for taxation on solicitor and own client basis.

Reporter: E.F.

1 Judgment of Miss Justice Laffoy delivered on the 27th day of February, 2009.

The substantive proceedings

2 The plaintiff is the daughter of Mary Josephine McDonagh (the testatrix) who died in August 2003. The defendants, who are solicitors, are the executors of the will of the testatrix and have been substituted as defendants in these proceedings in that capacity.

3 The primary relief sought by the plaintiff in the proceedings is a declaration that a purported deed of severance executed by the testatrix prior to her death purporting to sever the joint tenancy of the plaintiff and the testatrix in a licensed premises and dwelling in Baltinglass, County Wicklow was void and of no effect. The plaintiff also claims a declaration that she is entitled to the entire beneficial interest in the licensed premises and dwelling house in the events which have happened.

The application

4 The respondents on this application, which was initiated by notice of motion dated 9 ^th December, 2008, which was issued on behalf of the plaintiff pursuant to an order made by this Court (MacMenamin J.) on 8 ^th December, 2008, are Raymond Bradley and Frank Lanigan, both solicitors, who practise together as Malcomson Law, solicitors, who are the solicitors on record for the plaintiff in these proceedings. I will refer to the firm of Malcomson Law as "the former solicitors". On this application the plaintiff seeks an order directing the former solicitors to deliver all files, documents and papers in their possession relating to these proceedings to Liam Lysaght & Company, solicitors. I will refer to Liam Lysaght & Company as "the new solicitors".

5 In the notice of motion it is recognised that delivery of the documents should be conditional on the new solicitors undertaking to hold the documents subject to the former solicitors' lien and to return them to the former solicitors on the conclusion of the proceedings and on such delivery being without prejudice to the former solicitors' claim for costs against the plaintiff.

6 It emerged at the hearing that a notice of change of solicitor has not yet been filed by the new solicitors. I assume that this will be attended to immediately and so direct.

The law

7 The law distinguishes between two situations in which a solicitor may be discharged while proceedings are ongoing. The first is where the client terminates the solicitor's retainer, in which case the solicitor is entitled to rely on his lien until his fees and outlay have been discharged. The second is where the solicitor for good cause terminates the retainer. In that situation there is a long established equitable jurisdiction under which the Court, in order to enable the client's litigation to proceed, orders the solicitor to hand over the client's papers to the client's new solicitor, provided the new solicitor undertakes to preserve the former solicitor's lien and to return the papers to the former solicitor, for what they are worth, at the end of the litigation. I have considered the jurisprudence in two recent judgments: Mulheir & Anor. v. Gerard Gannon [2006] IEHC 274, in which judgment was delivered on 17 ^th July, 2006; and Ahern & Ors. v. The Minister for Agriculture and Food, Ireland and the Attorney General [2008] IEHC 286, in which judgment was delivered on 11 ^th July, 2008. As both parties referred to them, I do not consider it necessary to repeat what I have said in those judgments, which I am satisfied correctly sets out the law in this jurisdiction.

8 However, on this application, counsel for the former solicitors has referred the Court to, and placed particular reliance on, a decision of the High Court of England and Wales, to which I did not refer in either of those judgments. That is the decision of Moore-Bick J. in Ismail v. Richards Butler [1996] 3 W.L.R. 129. In that case, Moore-Bick J. applied the established jurisprudence as set out by the Court of Appeal in Gamlen Chemical Company (U.K.) Limited v. Rochem Limited [1980] 1 W.L.R. 614. Having found, on the facts, that it was the solicitors who had discharged the retainer for reasonable cause, by requiring payment of outstanding fees as a precondition to continuing to act, he outlined the position as follows (at p. 145):

"In these circumstances the plaintiffs would in the ordinary way be entitled as of course to an order that papers required for the conduct of pending litigation be delivered to their new solicitors against an undertaking, which those solicitors are willing to give, to restore them at the end of the litigation and without being required to provide any further security in respect of the costs. However, it was recognised in Gamlen Chemical Co. (U.K.) Ltd. v. Rochem Ltd. that the Court can, and in exceptional circumstances will, attach conditions to such an order to meet the overall justice in the case."

9 Moore-Bick J. then posed the questions whether that case was an exceptional case and, if so, what conditions should the Court impose. He found it to be an exceptional case and directed that the plaintiff client provide security for the defendant solicitors' claim for outstanding costs, which were in the region of £450,000 and related to litigation, some of which had been completed and some of which was ongoing. The rationale for making that order was set out in the judgment (at p. 147) as follows:

"I can see no basis for criticising [the solicitors'] conduct in this matter, and such indications as there are suggest that in some respects the plaintiffs' attitude may owe more to negotiating tactics than to a real sense of grievance. I accept that the plaintiffs require the immediate delivery of the papers in the three matters mentioned in their summons which remain fully live, but if [the solicitors] are required to hand over the papers on the usual terms their lien is likely to prove of little value when the papers are returned to them. It has not been suggested, on the other hand, that the plaintiffs are likely to suffer any real hardship if they are required to provide security of another kind other than the general effect on their cashflow of having to fund a payment into Court. That is a difficulty which can probably be largely overcome by providing security in some other recognised form. Taking all these matters into account I am satisfied that the interests of justice in this case require that the plaintiffs provide some security for [the solicitors'] claim."

10 The...