Marsh & Marsh

Case [2014] FamCA 361


FAMILY COURT OF AUSTRALIA

MARSH & MARSH [2014] FamCA 361

FAMILY LAW – LEGAL PRACTITIONERS – Solicitor lien – Nature of lien – Where the applicant, by an Application in a Case, sought orders that certain sums held in two separate trust accounts be paid to him on account of his fees – Relevant authorities cited – Where a lien can only arise if there is a sufficient causal link between the solicitor’s exertions and the recovery of the fund of money – Where the Court determined that only one sum of money held in trust was paid as a result of the proceedings taken before an interim property settlement or costs order in which the solicitors acted – Where that sum of money was obtained for the respondent through the actions of the applicant, and therefore there is the necessary causal link between the industry of the solicitor and the funds – Where the same cannot be said for the second sum of money paid into a different trust account – Where there is no evidence that establishes that the second sum was obtained as a result of the actions of the applicant – Where the purpose of a solicitor’s lien is not to create a general security over the assets of the client but is limited to the specific circumstances set out in Firth & Centrelink (2002) NSWSC 564.

Family Law Act 1975 (Cth)
Firth & Centrelink (2002) NSWSC 564
Jackson & Richards (2005) NSWSC 630
APPLICANT: Mr Majumdar
RESPONDENT: Ms Marsh
FILE NUMBER: SYC 3464 of 2009
DATE DELIVERED: 20 May 2014
PLACE DELIVERED: Sydney
PLACE HEARD: Sydney
JUDGMENT OF: Aldridge J
HEARING DATE: 20 May 2014

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Mr Davies
THE RESPONDENT IN PERSON: No appearance

Orders

  1. That the sum of $250,000, together with any accrued interest being the proceeds of the sale of the property LL Street, KK Town, presently held in the Champion Legal Controlled Monies Account pursuant to Orders of this Court made on 12 July 2013, shall be paid to the applicant. 

  2. That Order 1 above is stayed up to and including 24 June 2014.

  3. That liberty is granted to the respondent, Ms Marsh, to apply to set aside Order 1 hereof or, to seek a further stay, upon forty-eight (48) hours’ notice. 

  4. That a copy of these Orders are to be served upon the respondent, Ms Marsh, either personally or by leaving the documents at … MM Street, K Town. 

  5. That leave is granted to the applicant to file an application for costs in respect to this application.   Such application is to be served upon Ms Marsh as soon as practicable and evidenced by an affidavit of service. 

  6. That, providing the Court is satisfied the respondent, Ms Marsh, has been served with the application for costs, that application is listed before me at 9.30am on Friday 13 June 2014 to be dealt with.

IT IS NOTED that publication of this judgment by this Court under the pseudonym

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Marsh & Marsh [2014] FamCA 361
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[2014] FamCA 361
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CaseChat Overview and Summary

In *Marsh & Marsh*, the applicant, a solicitor, sought orders for payment of his fees from sums held in two separate trust accounts. The dispute concerned the nature and extent of a solicitor's lien over funds held by the solicitor on behalf of a client. The matter came before Aldridge J.

The court was required to determine whether the solicitor had a valid lien over the two sums of money held in trust. Specifically, the court had to consider whether there was a sufficient causal connection between the solicitor's actions and the recovery or preservation of these funds to justify the assertion of a lien. The court also needed to consider the purpose of a solicitor's lien and whether it could operate as a general security over a client's assets.

Aldridge J reasoned that a solicitor's lien arises only when there is a direct causal link between the solicitor's exertions and the recovery of a specific fund. The court found that one sum of money, held in the Champion Legal Controlled Monies Account, was indeed recovered as a result of the solicitor's actions in proceedings related to an interim property settlement. This established the necessary causal link for a lien over that amount. However, the court found no such evidence for the second sum of money held in a different trust account, concluding that it was not obtained as a result of the solicitor's efforts. The court reiterated that a solicitor's lien is not intended to create a general security interest but is limited to specific circumstances where the solicitor's work directly leads to the acquisition or preservation of the funds.

The court ordered that the sum of $250,000, along with any accrued interest, held in the Champion Legal Controlled Monies Account, be paid to the applicant. This order was stayed until 24 June 2014, with liberty granted to the respondent to apply to set aside the order or seek a further stay. The court also granted leave for the applicant to file an application for costs concerning this application.

Orders

Orders of the court

1.

That the sum of $250,000, together with any accrued interest being the proceeds of the sale of the property LL Street, KK Town, presently held in the Champion Legal Controlled Monies Account pursuant to Orders of this Court made on 12 July 2013, shall be paid to the applicant.

2.

That Order 1 above is stayed up to and including 24 June 2014.

3.

That liberty is granted to the respondent, Ms Marsh, to apply to set aside Order 1 hereof or, to seek a further stay, upon forty-eight (48) hours’ notice.

4.

That a copy of these Orders are to be served upon the respondent, Ms Marsh, either personally or by leaving the documents at … MM Street, K Town.

5.

That leave is granted to the applicant to file an application for costs in respect to this application. Such application is to be served upon Ms Marsh as soon as practicable and evidenced by an affidavit of service.

6.

That, providing the Court is satisfied the respondent, Ms Marsh, has been served with the application for costs, that application is listed before me at 9.30am on Friday 13 June 2014 to be dealt with.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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