Eden King Lawyers Pty Ltd v Makari

The dispute in this case was between Eden King Lawyers Pty Ltd, the solicitor, and Makari, the client. The central issue was whether the solicitor was entitled to a lien over settlement funds paid directly to the client by the opposing party, and if so, whether the solicitor was successful in proceedings to recover fees, and thus entitled to an order for costs. The case was heard in the Supreme Court of New South Wales. The court was required to decide whether the solicitor was successful in its claim for fees, as this would determine if it was entitled to an order for costs. It was also required to consider whether the solicitor's actions were appropriate, particularly in light of the conflict of interest that arose from the solicitor obtaining an ex parte freezing order.

The court found that the solicitor had not been successful in its claim for fees, as the costs assessor had set aside the costs agreement and substantially reduced the claimed fees. The court held that the solicitor's reliance on an "offer" made before the termination of the retainer to reduce fees was not sufficient, as the offer did not warn the client of the costs consequences of failing to accept it. The court also found that the solicitor's actions gave rise to a conflict of interest, as it had obtained an ex parte freezing order, which was not appropriate in the circumstances. As a result, the court refused costs to both parties.

The court's decision highlights the importance of clear communication and transparency in solicitor-client relationships, particularly when it comes to costs agreements and the potential consequences of failing to accept an offer to reduce fees. The court also emphasised the need for solicitors to avoid conflicts of interest, particularly when obtaining ex parte orders. The decision serves as a reminder to both solicitors and clients to carefully consider the implications of their actions and to seek independent legal advice where necessary.