- 28 July 2020
- Posted by: Siobhán Lafferty
- Category: Employment and Regulatory
Solicitor disciplined after threatening to destroy client files
In a recent Court of Appeal decision, Sheehan v the Solicitors Disciplinary Tribunal and Others , a solicitor who had been found guilty of professional misconduct by the Solicitors Disciplinary Tribunal after threatening to destroy client files for the non-payment of fees was unsuccessful in the appeal of the decision against him.
Mr Sheehan acted on behalf of Mr and Mrs Bingham between 2006 and 2008 in relation to a medical negligence case arising from the death of their son. There was an oral retainer in place and the case was taken on a contingency fee basis (“no win no fee”). Mr Sheehan later attempted to change their fee arrangement, and the Binghams refused. Mr Sheehan therefore terminated the relationship and came off the record in the proceedings.
Mr Sheehan served a bill of costs of €37,725 on the couple. They refused to pay on the basis that no fees were due to him, in accordance with the retainer they had agreed. He subsequently sued the Binghams in the Circuit Court for payment of the fees and they brought a counterclaim for professional negligence and breach of contract. Both cases were dismissed and the decisions, ultimately, were not appealed.
The Binghams proceeded to make a series of complaints against Mr Sheehan to the Law Society of Ireland. Two of these complaints were investigated and subsequently rejected and no findings of misconduct were made. Mr Sheehan informed the Complaints and Clients Relations Section of the Law Society that he intended to destroy the files in accordance with Chapter 9.12 of the Law Society’s ‘A Guide to Good Professional Conduct for Solicitors’. Thereafter the Binghams wrote to Mr Sheehan stating that he was not to destroy the files. Mr Sheehan wrote back saying that he would be destroying the files and then stated:-
“In the circumstances, I am prepared to afford you one final opportunity to make an offer to the writer in respect of my outstanding bill of costs dated 6 May 2008”.
The Binghams again forbade Mr Sheehan from destroying the files. They also needed the file for a Supreme Court appeal in their medical negligence case. They did not offer any further fees and Mr Sheehan did not destroy the files to free up space as he suggested, although he did keep them. This led to a third complaint, comprising of 23 individual grounds of complaint, direct to the Solicitors Disciplinary Tribunal (the “Tribunal”) in respect of Mr Sheehan by the Binghams. Out of the many complaints identified, the Solicitors Disciplinary Tribunal held that there was a prima facie case in respect of two allegations:-
- that Mr Sheehan was abusing his position by threatening to destroy the entire file unless the Binghams settles his alleged bill of costs, despite a Circuit Court Order dismissing his claim; and
- Mr Sheehan’s refusal to return the file or grant access to the file for the purpose of the Supreme Court Appeal.
The Tribunal found Mr Sheehan guilty of misconduct “morally culpable or otherwise of a disgraceful kind” in respect of the first allegation alone. They censured him and ordered him to pay a sum of €5,000 to the compensation fund and €750 to the Binghams.
Statutory Appeal to the High Court
Mr Sheehan appealed the decision to the High Court challenging the Tribunal’s jurisdiction to hear the complaint, and the finding of misconduct on the merits. In respect of the jurisdictional point, Mr Sheehan argued that the Binghams were not entitled to make the complaint, that the Tribunal would be acting ultra vires if it proceeded to hold an inquiry in respect of the complaint, that the alleged grounds of misconduct were res judicata and that there had been no finding that he had committed an act of ‘misconduct’.
The High Court judge rejected his argument in respect of the finding of misconduct on the merits. He noted that the lien over the files had been extinguished in the circumstances. He also held that there was no jurisdiction to accommodate the type of judicial review jurisdictional argument which Mr Sheehan had put forward, when the case was a statutory appeal created by the Solicitors Acts. Notwithstanding this, even if there was such jurisdiction it was considered that Mr Sheehan had acquiesced in and waived his entitlement to raise a jurisdictional challenge by participating in the proceedings at the Tribunal.
Mr Sheehan then appealed the case to the Court of Appeal.
Court of Appeal
Mr Sheehan argued that the trial judge was wrong in holding that his lien over the files had been extinguished based on the facts of the case, and had further erred in respect of upholding the Tribunal’s finding of misconduct.
On these issues, the Court of Appeal suggested that Mr Sheehan had missed the point of the Circuit Court decision. It was pointed out, as had been outlined in the High Court, when the fees were no longer due, then the lien ceases to exist. It was clear that the email sent to the Binghams was a ‘clear and unambiguous threat’.
It was noted that Mr Sheehan had conflated the issue of (allegedly) holding a lien over the files and destroying the files. It was pointed out that regardless of whether a solicitor is owed fees from a client, there is no basis in law to destroy a file which is not his property. Therefore the Court dismissed this ground of appeal.
Mr Sheehan had also appealed the jurisdiction of the Tribunal to hear and determine the third complaint. The appeal which the High Court heard was under the relevant provisions of the Solicitors Acts, and was therefore a statutory appeal. Mr Sheehan argued that the scope of section 7(11) of the Solicitors Acts encompassed his jurisdictional challenge to the Tribunal. He argued that because the High Court had the power to rescind, vary or confirm the order of the Tribunal then the High Court could not confirm an order if the Tribunal had no jurisdiction to make the order, on the basis of the arguments made out above. In turn then, he argued that the High Court had to be satisfied that the Tribunal had jurisdiction.
However, Costello J also dismissed this ground of appeal and agreed that had Mr Sheehan wanted to raise arguments of jurisdiction, these should have been done by way of judicial review. She also agreed with the trial judge that he had acquiesced by partaking in the proceedings of the Tribunal.
Therefore the Court of Appeal dismissed Mr Sheehan’s appeal.
Costello J made it clear in this case that a solicitor may exercise a lien over a client’s file and refuse to return the file to a client where the client owes the solicitor fees. However, in Mr Sheehan’s case, he had sued the clients for the fees unsuccessfully where the Circuit Court had dismissed his claim. As a result, there were no fees due to Mr Sheehan and therefore he could not assert a lien over the files or threaten to destroy the file in the circumstances, especially where he had been specifically asked not to do so.
This case is also a reminder of the importance of putting in place the proper structures for the solicitor client relationship at the commencement of any dealings. The fact that an oral agreement had only been in place in this matter was unlikely to be helpful in his case suing the Binghams in the Circuit Court.
It is clear from the decision of the Tribunal, which has now been affirmed by the High Court and Court of Appeal, that behaviour such as Mr Sheehan’s will not be tolerated and falls within the category of being ‘morally culpable or otherwise of a disgraceful kind which tended to bring the solicitors’ profession into disrepute’ leading to a finding that the behaviour was professional misconduct.
For further information on this topic, please contact Siobhán Lafferty at firstname.lastname@example.org