Topic 3A Notes

The lawyer-client relationship  Numerous duties found under contract, tort and fiduciary relationship and equity  The duties include:  Competence  Loyalty  Confidence  Others – provide quality client care, promote access to justice and encourage settlement  The retainer  This marks the commencement of the duties owed to the client; it is essentially a contract between the lawyer and the client – it sets out the work to be completed  It identifies the parameters of the relationship and therefore the extent of the duties owed  The retainer, if done well, identifies the work that will be done, the work that is owed and the parameters of the relationship  The retainer sets out these duties  Wong v Kelly (1999)  Sets out the retainer is like any other contract and should be treated as such at the legal level  How do we create the retainer?  Generally expressly in writing, but can be oral or by implication (implication = based on the conduct of the parties)  Hedley Burn & Co Ltd v Hellup Ltd (1964) AC 465 – the implication simply says that where the lawyer gave informal advice and should have known the party giving advice to would rely upon that advice, then retainer is created by implication  E.g. if you are going to a party/having a chat to a friend, if they ask for opinion on legal matter, you should make it very clear that this does not constitutes legal advice ; if you don’t and this is relied upon, it is entirely possible that a retainer is created by implication  If created by implication or orally :  There is an onus on party alleging the lawyer-client relationship exists to demonstrate/establish that the relationship exists/had been created  Pegrum v Fatharly (1996) 14 WAR 92

 Lawyer represented a client in relation to financing and at no point did they seek, when drafting such docs, to advise the person lending the money to seek independent legal advice  They did not disclose that the person borrowing was at high-risk of default and the collateral put forward for the loan was insufficient to pay the debt  Lawyer was then sued for negligent legal advice on the basis that they should have done above and their conduct created a retainer between the two parties (lawyer and person lending money through their conduct)  Mjiok (??) v Hendricks (2007)  Woman looking to transfer property from one son to another and it was pointed out that transfer of the second property to the second son would create implications on her pension  It was suggested instead that she leave the other property to the other son in her will, other son agreed and continued to act as if had been transferred, and the lawyer who oversaw the drafting of the will and property transfers at no point suggested that they obtain independent legal advice, putting forward the implication that they were acting as their lawyer  When, the mother changed her mind and changed the will to not give the son the property that was promised and this came to light after she died, the other son who was promised and acted in accordance sued for negligent legal advice due to a retainer was created due to the conduct re: how the advice was given without the recommendation of seeking independent legal advice  NOTE: it is prudent to make sure the retainer is in writing;  Also, client- capacity is an on-going feature; Along with the need to demonstrate capacity at the time the retainer was created but also client-capacity needs to be an on- going matter throughout the retainer  Key features of drafting retainer is to avoid ambiguity, the retainer (*as well as being in writing) should:  (1) identify the client(s)  (2) set out the scope of the retainer  i.e. what work is the lawyer obligated to do under this retainer and what is the nature of the work being conducted  What is the work being conducted? What are the limits of the work being conducted?  There is clarity that the lawyer knows and the client also understands the limits of what is being taken care of  (3) outline the services that the lawyer is going to provide  (4) outline the costs to be charged and how payment is to be made  i.e. does your firm used fixed-billing, incremental billing (usually six-minute), what are the rates of the bills?  What is the estimated time required to undertake the matters set out in the retainer?  All of the above must be adhered to  (5) set out the lawyer’s authority to enter negotiations, etc. on behalf of the client  Purpose of setting out matters in a clear and unambiguous manner is to avoid misunderstandings and any surprises that may come about  Who is the client (feature 1 of retainer)?  Need to clearly identify – e.g. deceased estate, power of attorney  Onus of checking identity of the client and who they actually are seen in Ford v Financial Services (2012)  If there are joint clients, need joint instructions

 Need to ensure that all clients are properly identified, and all have been given proper instruction  Person insisting existence of lawyer is to prove that the retainer is in place; seen in Cliffs Australia; Griffith v Evans  Individual clients coming to see a lawyer together – beware!  Clients don’t retain an individual lawyer, they retain the firm at large  This is important because this will create problems in duties to client to different individual clients looking to retain separate lawyers within the same firm – they are retaining the firm – ( Kelly v Jowat (2009))  SUMMARY:  Need to clearly identify the clients; we have all sorts of needs to identify clients and this is about the lawyer’s protection  Also, where you have joint clients, clear instructions must be gained from each of the clients  Should always seek, where possible, to have clients retain separate legal advice  What is the scope of the retainer (Key feature 2 of creating retainers )?  Terms should be clearly expressed as this will determine the scope of the:  (1) lawyer’s authority as an agent; and  (2) duties owed by lawyer to client  In terms of this, there are implied authorise and these amount to:  The ability to incur costs,  The ability to receive money on behalf of client  Ability to compromise on non-collateral matters within the scope of the retainer  Retainer should clearly specify all matters to be taken by the lawyer for the client under the scope of the retainer  Owners – Strata Plan no 45205 [2009] NSWSC 1189  Any ambiguity will be construed in favour of the client (contra preferentem)  Polkinghorne v Holland (1934) 51 CLR 143  Includes the authority to do all things incidental to the purposes of the retainer  The lawyer has an implied authority to undertake matters incidental to the purposes of the retainer itself  Astely v Austrust Ltd (1999) 197 CLR 1  The lawyer is to protect client interests and exercise reasonable care and skill when carrying out client instructions and the lawyer is to keep communications confidential  SIG: This is an implied term of the retainer that the lawyer is to protect the client interests and exercise reasonable care and skill when carrying out client instructions  SUMMARY:  If there is any seeking to modify the implied terms of the retainer, the onus of modification and establishing this rests with the lawyer  If the lawyer wishes to expand or shrink the scope/authority given, they must set this out in the retainer (expressly set out)  While there is implied authority to do incidental matters, This does not extend to instituting of proceedings or to receive notices on behalf of the client or entering into contracts on behalf of the client – for this you need express authority  The scope of the retainer must be clear so you can determine the limits of the relationship is between the client ; must be clear to determine whether acts or omissions fall within or outside the retainer  Lawyers generally need express authority to:  Compromise a proceeding