Legal Profession Act changes sought on solicitor’s lien registration

A change in policy of the Land Title Office (LTO) has prompted the Law Society to request an amendment to section 79 of the Legal Profession Act to specifically allow for the registration of a claim of solicitor’s lien.

The Law Society’s preliminary view is that the amendment should expressly authorize the Benchers to make rules for the registration of a claim of lien and prescribe the requisite form, which allows for future amendments and refinements without further recourse to legislation.

Background

At common law, a lawyer who has not been paid a proper fee for legal services is entitled to a lien on the client’s personal property that has been recovered or preserved as a result of the lawyer’s work. Section 79 extends that right to include a charge against real property that the lawyer has recovered or preserved on behalf of the client in a proceeding, including a matter before an administrative tribunal. This is similar to the liens that the law permits to builders, repairers and woodworkers, among others, giving them a claim on the property on which they have worked to ensure that their labours are rewarded.

Until recently, a lawyer could informally secure legal fees by submitting to the LTO a solicitor’s letter stating the basis for the claim against real property. But the LTO has reconsidered its policy and decided that, without a court order, it cannot be satisfied that an applicant seeking to register a lawyer’s charge is "entitled to good, safeholding and marketable title," as required under the Land Title Act. The LTO issued Practice Bulletin No. 0199 to the effect that, in order for a claim under section 79(1) of the Legal Profession Act to be registered, the application must be accompanied by a judicial order establishing the right to the charge.

The LTO Practice Bulletin states that, in order to assert a solicitor’s lien, a lawyer must now commence an action against the client and obtain an order declaring the solicitor’s interest in real property. In the interim, the lawyer may file a caveat or certificate of pending litigation under the Land Title Act.

A more expedient procedure is to bring a notice of motion in the existing action in which the lawyer has preserved or recovered the property in question. The courts have followed Henry v. Columbia Securities Ltd. (1942), 58 BCR 193 (CA) in allowing such an application. The lawyer may also apply to be added as a party to the action in order to file a certificate of pending litigation under section 215 of the Land Title Act.

Reason for legislative request

The section 79 solicitor’s lien is important, not only for lawyers but also for their clients. Lawyers may accept a retainer confident in the knowledge that their fees can be secured by a charge on any real property that they preserve or recover for the client. This has assisted litigants — very often women — with few or no liquid assets to obtain legal representation, while the other party may otherwise have the resources to hire counsel and attempt to defeat a valid claim.

The Law Society has requested a change in the legislation to ensure that there is an expeditious and cost-effective process for registering claims of liens and so that there are few situations in which lawyers will need to bring the matter before the courts to secure their fees, a practice that is not conducive to a trust relationship.

While the Law Society has requested specific remedial legislation, amendments can take some time. The Benchers are meanwhile considering whether their general powers under the Legal Profession Act already provide sufficient authority for them to make the remedial rules under section 79(1), or whether there are other legal options to pursue.