Under The Nigerian Law, A Legal Practitioner Cannot Exercise A Lien Over His Client’s Funds Entrusted To Him For The Former’s Benefits: A Contrary View By E.F. Aghedo

Generally, it is difficult to find a universally accepted definition of any concept in legal theories. “Lien” is by no way an exception to this notorious fact. Therefore, it is not out of place to find as many definitions as there are many writers on the concept. Professor I.O. Smith in his book, Nigerian Law of Secured Credit, Ecowatch Publishers Ltd, 2001 at pg. 37 defines lien as “A right to retain property until indebtedness is discharged”.

A lien has also be defined as a right of a man to retain that which is in his possession belonging to another till certain demands the person in possession has made are satisfied. A point that must be noted is that a lien confers a right of retention until a debt is paid. There is generally no right conferred on the party claiming a right to lien that the party is capable of transferring to a third party. For example, by sale of what is in his possession, except by order of court. For the purpose of this work we will not delve into the different classes of lien in detail which basically are classified into:

1. General Lien and Particular Lien
2. Common Law Lien and Equitable Lien
3. Statutory Lien and Contractual Lien.

The Legal Practitioners Disciplinary Committee (LPDC) have held that a legal practitioner in Nigeria has no right to a lien. But we shall soon see that the opinion held by the LPDC with due respect do not represent good law and should be avoided. There is no doubt that a legal practitioner in the United Kingdom where we borrowed most of our practice from has a right to a lien. Some judicial authorities point to this truism. For example, a solicitor has a general lien upon his client’s papers including his insurance policies in his possession for costs.See Richard v. Planet (1841) 10 LJ CH pg. 375. The cost not only includes costs arising from his services in connection with the policy but also covers all cost arising from the general professional services rendered by the solicitor for which fees are outstanding. See worral v. Johnson (1820) Jac & Walk pg. 214.

There is no doubt that under common law a solicitor has a general lien upon his client’s properties in his possession. It is not in doubt that the lien arose by operation of law being a creation of common law. It is also apt to quickly point out that common law principles are still applicable in Nigeria except where expressly made inapplicable.

A glance at other jurisdictions particularly Canada, a common law jurisdiction like ours show that there are generally four types of solicitors’ Liens.
The first is the retaining (it is also referred to as a common law lien, this falls into the first class of lien in our first classification) lien which allows a solicitor to retain a client’s property, with some exceptions, until the solicitor has been paid.

The second is a charging (or statutory) lien under Section 3 of the Legal Practitioners (Ireland) Act 1876 which provides that where a Solicitor is employed to prosecute or defend a case in Court, then the Court can declare that the Solicitor is entitled to a Charge on the property recovered or preserved. There is no such express statutory provision in the Legal Practitioner’s Act applicable in Nigeria.

The third is a Preserving (or equitable) lien which is a right to ask the court to order that personal property recovered under a judgment obtained with the solicitor’s assistance stand as security for his costs.

The fourth is a contractual lien.
A retaining (or common law) lien gives solicitor the right to retain a client’s money, documents or other property in their possession until outstanding fees are paid. This means that if a client owes a solicitor money, the solicitor can hold lien over all papers, files, documents and deeds that belong to the client that the solicitor received while representing the client. A solicitor can also hold a lien over money that the solicitor is holding on behalf of a client.

For example, after the conclusion of case a solicitor might receive a cheque on behalf of the client. Where the client fails to pay the solicitor’s fees, there is nothing stopping the solicitor from exercising a right of lien over such money in his possession pending when his fees are paid except where a court order otherwise. The solicitor may by contract create a lien. This writer is aware of the provisions of the Rules of Professional Conduct for Legal Practitioners as it relates to lawyers acquiring interest in the subject matter of litigation which they conduct. Rule 48(3) which makes this provision exempted lien. The writer is not unaware of Rule 21(2) as to the lawyer’s duty to account. This does not extend to lien because lien only gives a right to detain client’s property pending when the lawyer’s demand are met.

See Solicitors’ Liens by Andrew Cody; Wilson King & Co v Lyall (Trustees of), [1987] BCJ No 709, 12 BCLR (2d) 353 (BCCA) and Adam M Dodek & Jeffrey G Hoskins, Canadian Legal Practice: A Guide for the 21st Century, loose-leaf (consulted on May 14, 2012), (Markham, ON: LexisNexis Canada, April 2012); Law Society of British Columbia Practice Resource Solicitors’ Liens and Charging Orders –Your Fees and Your Clients, July 2013

However, the decision of the Legal Practitioners Disciplinary Committee (LPDC) in the case of N.B.A. v. Gbenoba (2015) 15 NWLR ( Pt. 1483) 585 per Daudu, SAN at 619 to 623 is on the contrary suggesting that under the Nigerian law a solicitor has no right of lien over his client’s money in his possession. According to the LPDC “… under the Nigerian law as it stands today, a legal practitioner cannot exercise a lien over his client’s funds entrusted to him for the former’s benefits.” We beg to differ from this view with due respect. This view may have been formed on basis that there is no express provision under the Legal Practitioners Act or any other applicable statute or Rules empowering legal practitioners in Nigeria to exercise a right of lien over client’s funds. That notwithstanding cannot justify the view held by the LPDC because there is nothing in any law in Nigeria expressly forbidding legal practitioners in Nigeria from exercising such right. More importantly, there is no law excluding the common law lien from applying in Nigeria. What in fact may be gleaned from our laws is that the legal practitioners’ right of lien is acknowledged. For the avoidance of doubt, the right of a solicitor to a lien in common law is firmly secured and it is applicable in Nigeria until there is a law expressly stating otherwise. It is also submitted that this common law right is acknowledged under Rule 48(3) of the Rules of Professional Conduct for Legal Practitioners, 2007 which in part states that “… a lawyer … may acquire a lien granted by the law to secure his fees and expenses”.
A reasonable interpretation of this provision suggest that a legal practitioner in Nigeria is entitled to a lien by operation of law. A right to lien under the common law is by operation of law.

The LPDC in Gbenoba case supra, with due respect misapplied even the decision of the Supreme Court in Afrotec Tech. Services (Nig.) Ltd. V. MIA &Sons Ltd. (2000) 15 NWLR (Pt.692) 730 p.786 and Sagoe v. Queen (1963) All NLR 295, (1963) 2 SCNLR 210 p.213 when it held that a lawyer’s right to lien is not applicable in Nigeria. This is what the LPDC had to say:

“What then is a lien and in what circumstances can it be exercised? Can a legal practitioner foreclose his client’s funds in his possession by the exercise of a lien and set-off against his own claims on his client? In Afrotec Tech. Services (Nig.) Ltd. V. MIA &Sons Ltd. (2000) 15 NWLR (Pt.692) 730 p.786 paras D-F the Supreme Court per Iguh, JSC defined “A lien, broadly, speaking, is a right to retain that which is in one’s possession belonging to another till certain demands of the person in possession are satisfied. The unpaid seller’s lien, is his entitlement to retain the goods in his possession until the buyer has paid or tendered the whole of their price. See Martindale v. Smith (1841) 1 Q.B. 389 at 396. The point that must be emphasized is that the unpaid seller’s right of lien depends on his being in possession of the goods at the time he exercises his right of lien….

Mr. Osigwe for the complainant has submitted the ‘legal jurisprudence in Nigeria does not recognize a lawyer’s right of lien in respect of his client’s funds’. For a number of reasons we agree with this position. Firstly, the scope of the exercise of a lien does not extend to a legal practitioner. He is not a seller of goods but the provider of statutory regulated services, to wit, legal services. Because the provision of legal services is regulated by the Legal Practitioners Act, there are ways and means through which an aggrieved legal practitioner can seek his fees for legal services rendered.…”

There is nowhere in the Afrotec’s case which the LPDC relied on that suggest that rights of lien can only be exercised by a seller of goods to warrant the kind of reasoning underlined above. This reasoning does not represent the law as far as lien is concerned in Nigeria. There are different classes of lien and the common law lien as earlier pointed out is not limited to buying and selling goods. Their conclusion from the Sagoe’s case is even worse. Here is what the LPDC had to say:

“ The respondent’s counsel Mr. Nordi has drawn our attention to the Supreme Court decision in Sagoe v. Queen (1963) All NLR 295, (1963) 2 SCNLR 210 p.213, paras C-H as authority that a lawyer can exercise a lien on his client’s funds in lieu of his fees…. The interesting part of Sagoe’s case is captured by the following passage of the judgment of the Supreme Court thus:

“That paragraph in Hals bury read as follows: “237 solicitor’s rights. At common law a solicitor has two rights which are termed liens. (q). The first is a right to retain property already in his possession until he shall have been paid costs due to him in his professional capacity (r) and the second is a right to ask the court to direct that personal property recovered under a judgment obtained by his exertions stands as security for his cost of such recovery (s). In addition, a solicitor has by statute a right to apply to the court for a charging order on property recovered or preserved through his instrumentality in respect of his taxed cost of the suit, matter, or proceeding prosecuted or defended by him” (The footnotes are not copied). Presumably, it is the first right that is relied upon, and in that respect it should be noted that the lien is for costs due to the solicitor in his professional capacity. Lambo, J. took the view that the appellant did not do anything which could be rightly described as professional solicitor’s work giving rise to a claim for costs, and could not have any right of lien. The learned Judge also gave an alternative view, namely, that if the appellant had any right of lien, it was limited to what was due to him…. In passing, it is desirable to note that in the court’s view learned counsel for the appellant advanced a dangerous proposition: that a solicitor may spend money to which he claims a lien, and if it turns out that the amount he, thought he was entitled to was more than justly due to him, he could refund the excess. His proper course is to have his remuneration settled whether by negotiation with his client or by appropriate proceedings in the first instance. “

Thus under the Nigerian law as it stands today, a legal practitioner cannot exercise a lien over his client’s funds entrusted to him for the former’s benefits.

It is difficult to understand the conclusion of the LPDC from the Supreme Court’s decision quoted by them above. It is not contained anywhere in that decision that a legal practitioner is not entitled to a lien in Nigeria. The Supreme Court did also not say that the view expressed by Lambo J. underlined above is incorrect. The decision in contrast suggest the right of a solicitor to a lien. All the court did was to make a passing remark that the solicitor in that instant should have negotiated or institute an action; and distanced itself from the proposition that a lawyer could spend his client’s money. That does not necessarily mean that the right of a lawyer to lien is foreclosed. Strictly speaking, a right to lien does not give right to dispose or convert the property in possession, all that it gives, is a right to detain the property. It is only a court that can order for the disposition of the property. The LPDC’s conclusion that a lawyer “Pouncing on his client’s funds in the name of lien is nothing short of self-help and lawlessness” is correct to the extent of self-help but the use of the word “lawlessness” is unwarranted. The common law lien by its nature was likened to self-help that requires no court intervention by Lord Diplock LJ in TAPPENDEN V. ARTUS (1964) 2 QB 185 AT 195. The Court of Appeal in the case of JAGAL PHARMA LTD V. HUSSAINI & ANOR (2013) LPELR-21871 (CA) quoted Lord Diplock thus: “The common law remedy of a possessory lien, like other primitive remedies such as abatement of nuisance, self-defence or ejection of trespassers to land, is one of self-help. It therefore means that lien has long been recognised and should not be equated with lawlessness. It helps to protect the interest of lienor who may have rendered full service and is being owed certain sum due.

It is this writer’s view that a legal practitioner in Nigeria is not in any law excluded from exercising right of lien where it is appropriate. The option of negotiation or instituting an action to recover his fees did not close the door to exercise of a right of lien. However, the option to negotiate is better because it leads to better relationship with the client.