The X-Client Files: who owns a solicitor's file
It's a perennial headache for solicitors: what exactly am I supposed to do when a client asks me for 'their file'?
It sounds pretty straightforward, but, as is so often the way, it's not as simple as it looks. The perception that there is a magical document known as 'the file' which contains each and every piece of paper belonging to a client, and which must be handed over in its entirety on demand, is just not correct. So what do you have to hand over?
The Law Society has updated its guidance for practitioners, which draws together strands previously contained in several different notes, and it's worth a read. We've reported on this issue several times before and the new guidance arguably doesn't take us much further. It is, however, a helpful reminder on what action should be taken when faced with a file request, and that, actually, you don't have to hand over the whole file just because the client demands it.
Remember: file requests have nothing to do with relevancy. That's a question for disclosure (and that's a whole other blog). File requests are about delivery up – and that's about ownership.
The guidance explains that documents which come into existence during the retainer typically fall into one of two categories: those falling into existence where the solicitor is acting as a professional adviser, and those falling into existence where the solicitor is an agent of the client. If the documents fall into the latter category, they will normally belong to the client, using standard principles of agency. If the documents fall into the former category, ownership of the documents depends on the purpose of the retainer and whether the production of the document was a stipulation of the retainer.
The below is a quick ready reckoner on the classes of documents:
Documents belonging to the client
- Original documents sent to the firm by the client, unless title was intended to pass to the firm
- Documents sent or received by the firm as the agent of the client (e.g. correspondence with another party)
- Final versions of documents produced for the purpose of the retainer (e.g. agreements) or prepared by third parties (e.g. counsel's advice or expert reports)
Documents belonging to the firm
- Documents prepared for the firm's own benefit or protection (e.g. drafts and working papers) or as the means by which the firm discharges its function (e.g. file copies of letters sent to the client)
- Internal emails and correspondence
- Correspondence written by the client to the firm
- Accounting records
Whilst the above sets out the best practice guidance, there are a few other practical points worth bearing in mind:
- Remember the small print: what do your T&Cs say about destruction of documents, administrative charges and any provisions for the return of documents? Does it specifically state which documents belong to the firm and which belong to the client?
- Can you exercise a lien even if the document otherwise would belong to your client (albeit sometimes a court will just order inspection of the documents either way…)?
- Can the client make a sword from a SAR to get around those pesky GDPR rules? The scope of GDPR is beyond this note but you can find some useful guidance here. Consider whether it might be easier to hand over the papers voluntarily and avoid a painful disclosure process;
- If you want to maintain your client relationship, you may prefer not to rely on a technicality to hold on to their file;
- The 'smoking gun' exemption: if you are worried the request is a precursor to a claim but you hold that silver bullet which you are not technically required to disclose, consider whether it is genuinely wise to refuse to disclose;
- On a related note, if you are worried the request is a precursor to a claim but the client might need the file to mitigate their loss, you may not wish to obstruct them by refusing to hand over potentially helpful documents;
- Tipping off: don't forget that if your file contains any documents relating to a suspicious activity report, you should not disclose this; if in doubt, always speak to your MLRO.
- If you have more than one client, you will need to consider very carefully who is the true owner of the document;
- As above, the guidance only applies to file requests. Disclosure is very different and any disclosure request, rather than a request to deliver up will need to be considered in accordance with the CPR;
- Fishing requests remain forbidden under the Pre-Action Protocol for Professional Negligence.
- For the avoidance of doubt, there is no distinction between hard and soft copy documents.