Who gets the file notes? Supreme Court provides new guidance

Under regulation 14 of the Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015 a solicitor is obliged to give to a client ‘any client documents’ as soon as reasonably possible when requested to do so by the client (reg 14.1), and may destroy documents after a period of seven years except where there are client instructions or legislation to the contrary (reg 14.2).

The question of which documents are ‘client documents’ has been illuminated by two recent decisions of the Supreme Court of NSW.

File ownership

The principles are also the subject of the leading case in the area, Wentworth v De Montfort (1988) 15 NSWLR 348 (‘De Montfort’), and were discussed in an article which appeared in the June 2016 edition of this Journal (see: Bailey & Castle, ‘Yours, Mine or Ours: Access to the Solicitors’ File When the Retainer Ends’, 23 Law Society of NSW Journal, June 2016, 88-89). De Montfort was determined partly as a matter of ownership of property between a solicitor and a client, and partly as a matter of the right for a client to receive a copy of the file, even if owned by the solicitor. The case illuminated the point that whilst the doctrine of agency lies at the heart of the solicitor client relationship it is a modified form of agency, as applicable between a professional person and his or her client. In decided cases, the ‘distinction between principal and agent and professional person and client is well established’ (De Montfort at 352). Hope JA (with whom Samuels and Mahony JJA agreed), in De Montfort, recognised that the principles to be applied ‘do not form a coherent whole’ and it must be said that the reasons for the distinction, even in decided cases, are not entirely clear.

What can be discerned from the result of decided cases is that the law recognises an interest in property in favour of the professional person (including a solicitor) in certain cases, in particular where the creation of a document has been in furtherance of the person’s professional obligations or in the proper conduct of their professional practices, in addition to whatever benefit it may confer on the client. Hope JA observed (at 355):

‘It thus appears that if a solicitor is acting only as agent for a client who is his principal in the doing of some act, the ordinary rules of agency apply to him, and documents brought into existence or received by him when so acting belong to the client. However in other cases, different principles apply, those principles being referrable to the relationship between a professional person and his client’.