Flanagan & Anor v Considine (Approved)

Factual and Procedural Background

The underlying proceedings were initiated by way of an Equity Civil Bill dated 7 July 2020. The Plaintiffs seek orders directing the Defendant to execute a transfer of part of a property situated in County Clare, along with ancillary orders. The Plaintiffs allege that in May 2008 the first named Plaintiff and the Defendant entered into an agreement whereby the first named Plaintiff would purchase the property in trust for €100,000, which was paid, and that a company, successor to the second named Plaintiff, took occupation and commenced construction of a wastewater treatment facility with planning permission.

The Defendant contends that only part of the property was subject to the May 2008 agreement and denies obligation to transfer the full property. The Defence admits the agreement but disputes the accuracy of the property delineation. A central issue is the precise nature and details of the property agreed to be transferred.

In 2008, the first named Plaintiff instructed a firm of solicitors ("Solicitor Firm A") to act in respect of the transaction. This firm was later subsumed into another practice ("Solicitor Firm B"), which currently holds the relevant conveyancing file. The Plaintiffs sought a non-party discovery order directing Solicitor Firm B to produce the entire file related to the May 2008 agreement.

The original application for non-party discovery was refused by the County Registrar and subsequently by the Circuit Court, which also awarded costs to the Defendant. The Plaintiffs appealed this refusal.

The appeal is resisted by Solicitor Firm B on the basis that the files are held subject to a solicitor's lien for outstanding legal fees dating from 2008/2009. The court considered affidavits and submissions from both sides, noting that no authority directly on point exists regarding non-party discovery of a solicitor's file subject to lien where the solicitor is neither a party nor acted in the litigation.

Legal Issues Presented

1. Whether a non-party solicitor's file, subject to a solicitor's lien for outstanding fees, can be ordered disclosed by way of non-party discovery in related litigation.
2. How to balance the solicitor's lien rights against the necessity of the Plaintiffs to access documents critical to prosecuting their case.
3. What undertakings or conditions should accompany an order for non-party discovery in such circumstances to protect the solicitor's lien.

Arguments of the Parties

Appellants' Arguments

• Discovery of the solicitor's file is necessary and crucial for a fair disposal of the proceedings.
• The requested discovery is limited to a single conveyancing file, making compliance straightforward and not unduly burdensome.
• The Plaintiffs are willing to indemnify the non-party solicitor for any costs incurred in complying with the discovery order.
• There is no dispute that the documents sought are relevant and necessary; opposition is based solely on the assertion of a solicitor's lien.

Non-Party Solicitor's Arguments

• The solicitor's file is held subject to a valid solicitor's lien for substantial outstanding fees from legal work spanning the decade before 2009.
• There exist disputes about whether the fees are due, statute-barred, or whether proper statutory procedures were followed.
• The lien was asserted in 2009, and proceedings to recover fees were initiated but have since lapsed.
• The lien should protect the solicitor's interest, preventing forced disclosure without resolution of the outstanding fees.

Table of Precedents Cited

Court's Reasoning and Analysis

The court began by acknowledging the absence of direct authority on non-party discovery of solicitor files subject to lien where the solicitor is neither a party nor acted in the litigation. It noted the established principle that a solicitor’s lien applies generally to all client documents held, confirmed by the Supreme Court in Re Galdan Properties Ltd.

The court reviewed analogous cases involving solicitor’s liens in ongoing litigation where solicitors were replaced, finding useful guidance in a series of High Court and UK cases. These cases emphasize the court’s equitable jurisdiction to balance the competing interests of clients and solicitors, considering factors such as the stage of litigation, conduct of parties, and hardship.

The court recognized that the Plaintiffs’ ability to prosecute their case hinges critically on access to the conveyancing file held by the non-party solicitor. Without access, the Plaintiffs’ case would be severely prejudiced, compromising the court’s ability to determine the dispute.

Conversely, the court acknowledged the solicitor’s legitimate interest in recovering outstanding fees via the lien. However, the fees are disputed, substantial, date back over a decade, and proceedings to recover them have lapsed.

Balancing these interests, the court concluded that the necessity of the Plaintiffs to access the documents outweighs the non-party’s lien interest, especially given the lapsed recovery proceedings. The court proposed granting the non-party discovery order subject to undertakings from the Plaintiffs’ solicitors to preserve the lien and return the files at the conclusion of proceedings.

The court emphasized that compliance with the discovery order would be without prejudice to the solicitor’s lien or any separate proceedings for fee recovery, preserving the solicitor’s rights while allowing the litigation to proceed fairly.

Holding and Implications

The court ALLOWED THE APPEAL and ordered the non-party solicitor to make discovery of the conveyancing file subject to specific undertakings by the Plaintiffs’ solicitors. These undertakings require the Plaintiffs’ solicitors to:

• Receive the files without prejudice to the non-party’s lien;
• Preserve the lien over the files;
• Notify the non-party upon conclusion of proceedings or withdrawal of retainer and return the files if requested;
• Prosecute the proceedings actively.

The order ensures the Plaintiffs can access critical documents necessary to prosecute their claims, while protecting the non-party solicitor’s lien rights. The decision does not resolve the underlying fee dispute, which remains subject to separate proceedings. No new legal precedent was established; rather, the court applied and balanced existing principles to the unique factual context.