The High Court ruled that solicitor Susan Martin had no lien over the title deeds to former partner Niall P. Colfer’s family home, or over the proceeds from its sale. The decision concerned whether Martin could secure claimed legal costs and expenses against those assets; it did not decide whether Colfer or the Law Society of Ireland owed her those amounts.
Martin and Colfer had practised in partnership. In late 2004, after an investigation found a significant shortfall in clients’ funds, Colfer undertook not to practise as a solicitor. Martin said the partnership ended on 2 December 2004, when Colfer gave that undertaking. For the purpose of deciding the lien issue, President of the High Court Finnegan accepted that the partnership had been dissolved, while leaving the parties free to litigate that question later if necessary.
Martin claimed that Colfer had asked her to finish work on files for which fees had already been paid, and that she did so at her own expense. She also said she incurred substantial costs and outlay after the Law Society appointed her to administer the practice. She sought reimbursement from Colfer and/or the Law Society, and claimed a general, retaining or special lien over the home’s title deeds for the amounts claimed. Colfer disputed her account of having independently advised him and his spouse on a 2004 loan transaction.
The deeds had been held under undertakings given in connection with loans from the Irish Civil Service Building Society. The 1999 accountable receipt required the solicitors to hold the documents in trust for the Society. A later solicitor’s undertaking, given in May 2004, also required title documents to be held in trust pending stamping, registration and lodgement with the Society. Martin had signed a September 2004 letter confirming that she had consulted Colfer and his spouse independently, as required by a loan condition.
The home was sold under a separate court-approved arrangement requiring Colfer to lodge half the net proceeds with the Law Society. In the present proceedings, the parties agreed that any lien Martin had over the deeds would be secured against the sale proceeds to the same extent. The court therefore had to decide whether a lien existed, not determine the underlying reimbursement claims.
Finnegan held that when Martin claimed a lien, the deeds were held subject to the trust created by the 1999 receipt, not as Colfer’s agent. The court said no lien could arise in those circumstances. It did not need to decide whether a lien might have arisen if the deeds had later come into Martin’s possession after the mortgage was redeemed. Because no lien existed, the agreement did not affect the sale proceeds.