The lawyers (together, AB) represented a company client (C Co) under instructions from the director (Mr D) in civil litigation and with a fee arrangement that included a contingency fee. Prior to trial, the client-lawyer relationship broke down.  Mr D instructed new lawyers (New Lawyers).  The New Lawyers applied for an adjournment of the trial, supported by an affidavit from Mr D speaking of his “shock” at the fees charged by AB and asserting that AB had not done any preparation work at all for the trial.  

Mr D asked AB to provide C Co’s files to the New Lawyers.  AB replied that they would release the files on receipt of an undertaking from the New Lawyers that their fees would be paid in priority to the New Lawyers’ fees (see rule 4.4.2 of the Conduct and Client Care Rules).  AB and the New Lawyers then engaged in a series of back-and-forth correspondence about release of information.  AB issued a final invoice to C Co and continued to claim a lien over the files (see rule 4.4.4).  The dispute evolved to focus exclusively on the fees dispute.  C Co purported to cancel the contingency fee arrangement.  AB disputed C Co’s ability to cancel; they referred to the arrangement documented in two particular letters and they also referred to their letter of engagement.  The New Lawyers advised that they no longer required the full file from AB, as they had concluded the files would not contain any admissible evidence that they did not already have.  At the same time, they advised AB that Mr D was unable to find a copy of the letter of engagement and they asked AB to provide it.  AB replied that they would provide the full file “including our letter of engagement previously provided” on receipt of full payment of their fees.     

AB subsequently demanded payment of more than $100,000 in fees and threatened to sue for recovery.  Mr D sought advice from the New Lawyers on whether C Co was liable to pay those fees.  The New Lawyers considered they were hindered in advising on that issue without seeing the letter of engagement.  Because of AB’s continuing refusal to provide that letter, one of the New Lawyers complained about them.  AB subsequently provided a copy of the letter. 

The Committee’s discussion focused on whether a lawyer's right to a lien extended to a letter of engagement.  The Committee concluded that it did not.  One of its reasons for that was, it said, that a letter of engagement is not a document that is “held for a client”.      

The Standards Committee considered that it was “difficult to see how withholding a copy of the letter of engagement would be consistent with the obligations of client care arising under the rules”. It noted that the refusal to provide a copy of the letter occurred in the context of a dispute about the fees and that, ordinarily, the letter of engagement would assist in addressing such disputes. 

The Committee determined that AB’s conduct in refusing to provide a copy of the letter of engagement breached both rules 10 and 11 of the Conduct and Client Care Rules (as those rules stood prior to 1 July 2021).  Those rules relate to standards of professionalism and professional practice.  

The Standards Committee reprimanded AB and ordered them to pay fines totalling $2,000.