The question of whether a law firm can hold a client’s money as a lien to cover legal fees is at the centre of a dispute between a client and firm.
UK law firm Withers was this week denied the chance to appeal to the Supreme Court over whether it could hold its client’s money in case it was needed.
The appellate court ruled against the firm in December, finding that when determining whether client money held by a lawyer could be subject to a lien to cover legal fees, the issue was why the money was set aside. It had to be determined whether money was put aside for general purposes, or for a reason incompatible with a lien arising.
UK magazine The Lawyer reports the firm found itself caught up in a claim last year after it became involved in litigation between its client Ryback, and Langbar International. In this case, the client agreed to settle the claims against it for £30million. In a bid to safeguard the cash, the client paid the money tino the Withers client account.
The firm argued it should be allowed to set aside £410,000 of the client’s cash to cover fees incurred by the client during the course of its dispute with Langbar.
As reported by The Lawyer, Langbar argued the money was owed to it as part of the settlement, and the Court of Appeal agreed with this fact late last year.
The Supreme Court has now rejected the firm’s request to take the case to the court because “the application does not raise an arguable point of law of general public importance which ought to be considered by the Supreme Court at this time”.
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