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Lien, solicitor's lien


“It is trite law that a lien will be lost if it is claimed for the wrong cause of action or for the wrong amount: Automobile & General Finance Co Ltd v Cowley-Cooper (1948) 49 SR (NSW) 31 at 37 and White v Bini [2003] FCA 669. Here Mr Strikis has claimed a lien on the basis that a particular sum is due to him: as a solicitor, when it is not; or as an executor, when it is not. A solicitor's lien is a fragile security. This hearing was the opportunity for Mr Strikis to show what was due to him in comparison to what is claimed. In that he has failed. Whatever lien he ever had would now be dissolved because of his wrong claim”: Rasma Gulbis v Mikelis Strikis [2012] NSWSC 807. Slattery J. 13.7.12

Strikis v Legal Services Commissioner [2012] NSWADT 68. Patten DP & Ors. 

43 Upon the basis that a solicitor and client relationship existed between the Applicant and Mrs Gulbis, we come to consider whether the Applicant was entitled to a lien over the Certificate of Title in her name.

A solicitor is entitled to a retaining or general lien over documents belonging to his client that have lawfully come into his possession in his capacity as the client's solicitor until all his costs and charges have been paid: Leeper v Primary Producers Bank of Australia (1935) 53 CLR 250, and Johns v Law Society of NSW [1982] 2 NSWLR 1 at 18-19 per Hope JA.

44 The Respondent in rejecting the Applicant's claim to be entitled to a lien did so on two grounds, namely that Mrs Gulbis did not know and had no means of ascertaining the amount required to satisfy the lien and, secondly, that the lien was claimed for the wrong reason.

These propositions may be derived from Automobile and General Finance v Cowley-Cooper (1948) 49 SR 31 per Street J at 37 where his Honour, with approval, quoted from the judgment of Scrutton LJ in Albermarle Supply Company v Hind and Co (1928) 1 KB 307 at 318:

A person claiming a lien must either claim it for a definite amount, or give the owner particulars from which he himself can calculate the amount for which a lien is due.

The owner must then, in the absence of express agreement, tender an amount covering the lien really existing.

If he does not, unless excused, he has no answer to a claim of lien.

He may be excused from tendering (1) if he has no knowledge or means of knowledge of the right amount; (2) if the person claiming-the lien for a wrong cause or amount makes it clear that he will not release the goods unless his full claim is satisfied, and that claim is wrongful.

The fact that the claim is made for more than the right amount does not matter unless the claimant gives no particulars from which the right amount can be calculated, or makes it clear that he insists on the full amount of the right claimed.

45 In White v Bini [2003] FCA 669, Finkelstein J was required to consider whether a solicitor's lien extended to costs incurred by the solicitor in seeking to maintain the lien. His Honour held that it did not, on the basis that the lien extended only to debts owed to him in the character of attorney. To the contrary as Finkelstein J held the solicitor was claiming the benefit of a lien for costs which were for his own benefit as an adverse party to his client. His Honour went on to say:

There is another basis for rejecting Mr Bini's lien. It is trite law that a lien will be lost if it is claimed for the wrong cause or the wrong amount: Automobile & General Finance Co Ltd v Cowley-Cooper (1948) 49 SR (NSW) 31.

A lien will also be lost if a person claims it for two debts (one due and one not due) and intimates that he will not part with possession unless both debts are satisfied: Jones v Tarleton (1842) 152 ER 285; Kerford v Mondel (1859) 28 LJ (Ex) 303.

46 Finkelstein J then proceeded to quote the words of Scrutton LJ set forth above before observing:

The evidence in this case indicates that the trustees were always willing to pay Mr Bini's costs of the conveyancing transaction. Mr Bini insisted, however, that he would only release the file if both his conveyancing costs and the costs incurred by him following the order substituting the trustees were paid. Mr Bini's refusal to release the file by claiming a lien for a wrong cause - the costs incurred following the removal of the trustee - is sufficient to extinguish his lien.

47 Although there is authority to the effect that a lien may be upheld despite the fact that a bill of costs has not been rendered, provided the work has been performed: Re Cao [1996] ANZ Com R 321, this is not such a case. Here, in our view, the Applicant was wrongly seeking to extend his lien to costs and expenses payable to him in his capacity as an executor and wrongly seeking to extend the lien to a sum beyond that properly payable to him as solicitor for Mrs Gulbis.

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