The case of R.D.

Saxena v Balram Prasad Sharma revolves around the legal question of

whether an advocate can claim a lien over the litigation files of a client for unpaid fees. It
addresses the fundamental aspects of the advocate-client relationship, especially in cases where
financial disputes arise. The Supreme Court of India explored whether case files and legal
documents entrusted to an advocate can be equated with “goods” under Section 171 of the
Indian Contract Act, 1872, and whether advocates can withhold such files on account of
pending dues.
The judgement delivered by Justice K.T. Thomas established a precedent in determining that
advocates cannot claim a lien over litigation documents and emphasised the fiduciary nature of
the advocate-client relationship. This case is significant because it clarified the limits of an
advocate’s rights concerning unpaid fees and the professional conduct expected from legal
professionals.
Contents hide
1. Background of RD Saxena v Balram Prasad Sharma
2. Facts of RD Saxena v Balram Prasad Sharma
3. Issues Raised
4. Arguments by the Appellant (R.D. Saxena)
5. Arguments by the Respondent (Bank)
6. Court’s Observations and Reasoning in RD Saxena v Balram Prasad Sharma
7. RD Saxena v Balram Prasad Sharma Judgement
8. Conclusion
Background of RD Saxena v Balram Prasad Sharma
R.D. Saxena, the appellant, was an advocate who also served as the legal advisor to the Madhya
Pradesh State Co-operative Bank Ltd. (hereinafter referred to as the “Bank”). His professional
engagement with the bank was terminated, and a dispute arose when he refused to return certain
case files to the bank, claiming a lien over them for unpaid legal fees. The bank, needing the case
files for ongoing legal proceedings, filed a complaint against Saxena with the Madhya Pradesh
State Bar Council. The case eventually reached the Bar Council of India and later
the Supreme Court of India through an appeal.
The key question before the Supreme Court was whether an advocate could claim a lien on
litigation papers for unpaid fees, a matter which had not been explicitly addressed in previous
cases in Indian jurisprudence.

The main issue posed in this appeal has sequential importance for members of the legal
profession. The issue is this: Has the advocate a lien for his fees on the litigation papers
entrusted to him by his client? In this case the Bar Council of India, without deciding the
above crucial issue, has chosen to impose punishment on a delinquent advocate debarring
him from practicing for a period of 18 months and a fine of Rs.1000/-. The advocate
concerned was further directed to return all the case bundles which he got from his client
respondent without any delay. This appeal is filed by the said advocate under Section
38 of the Advocates Act, 1961.
As the question involved in this appeal has topical importance for the legal profession we
heard learned counsel at length. To appreciate the contentions we would present the
factual backdrop as under:

Appellant, now a septuagenarian, has been practicing as an advocate mostly in the courts
at Bhopal, after enrolling himself as a legal practitioner with the State Bar Council of
Madha Pradesh. According to him, he was appointed as legal advisor to the Madhya
Pradesh State Co- operative Bank Ltd. (Bank, for short) in 1990 and the Bank continued
to retain him in that capacity during the succeeding years. He was also engaged by the
said Bank to conduct cases in which the Bank was a party. However, the said retainership
did not last long. On 17.7.1993 the Bank terminated the retainership of the appellant and
requested him to return all the case files relating to the Bank. Instead of returning the files
the appellant forwarded a consolidated bill to the Bank showing an amount of
Rs.97,100/- as the balance payable by the Bank towards the legal remuneration to which
he is entitled. He informed the Bank that the files would be returned only after setting his
dues.
Correspondence went on between the appellant and the Bank regarding the amount, if
any, payable to the appellant as the balance due to him. Respondent Bank disclaimed any
liability outstanding from them to the appellant. The dispute remained unresolved and the
case bundles never passed from appellants hands. As the cases were pending the Bank
was anxious to have the files for continuing the proceedings before the courts/tribunals
concerned. At the same time the Bank was not disposed to capitulate to the terms dictated
by the appellant which they regarded as grossly unreasonable. A complaint was hence
filed by the Managing Director of the Bank, before the State Bar Council (Madhya
Pradesh) on 3.2.1994. It was alleged in the complaint that appellant is guilty of
professional misconduct by not returning the files to his client.
In the reply which the appellant submitted before the Bar Council he admitted that the
files were not returned but claimed that he has a right to retain such files by exercising his
right of lien and offered to return the files as soon as payment is made to him.
The complaint was then forwarded to the Disciplinary Committee of the District Bar
Council. The State Bar Council failed to dispose of the complaint even after the expiry of
one year. So under Section 36-B of the Advocates Act the proceedings stood transferred
to the Bar Council of India. After holding inquiry the Disciplinary Committee of the Bar
Council of India reached the conclusion that appellant is guilty of professional
misconduct. The Disciplinary Committee has stated the following in the impugned order:
On the basis of the complaint as well as the documents available on record we are of the
opinion that the Respondent is guilty of professional misconduct and thereby he is liable
for punishment. The complainant is a public institution. It was the duty of the Respondent
to return the briefs to the Bank and also to appear before the committee to revert his
allegations made in application dated 8.11.95. No such attempt was made by him.
In this appeal learned counsel for the appellant contended that the failure of the Bar
Council of India to consider the singular defence set up by the appellant i.e. he has a lien
over the files for his unpaid fees due to him, has resulted in miscarriage of justice. The
Bank contended that there was no fee payable to the appellant and the amount shown by
him was on account of inflating the fees. Alternatively, the respondent contended that an
advocate cannot retain the files after the client terminated his engagement and that there
is no lien on such files.
We would first examine whether an advocate has lien on the files entrusted to him by the
client. Learned counsel for the appellant endeavoured to base his contention on Section
171 of the Indian Contract Act which reads thus:
Bankers, factors, wharfingers, attorneys of a High Court and policy- brokers may, in the
absence of a contract to the contrary, retain, as a security for a general balance of account,
any goods bailed to them; but no other persons have a right to retain, as a security for
such balance, goods bailed to them, unless there is an express contract to that effect.
Files containing copies of the records (perhaps some original documents also) cannot be
equated with the goods referred to in the section. The advocate keeping the files cannot
amount to goods bailed. The word bailment is defined in Section 148 of the Contract Act
as the delivery of goods by one person to another for some purpose, upon a contract that
they shall be returned or otherwise disposed of according to the directions of the person
delivering them, when the purpose is accomplished. In the case of litigation papers in the
hands of the advocate there is neither delivery of goods nor any contract that they shall be
returned or otherwise disposed of. That apart, the word goods mentioned in Section 171
is to be understood in the sense in which that word is defined in the Sale of Goods Act. It
must be remembered that Chapter-VII of the Contract Act, comprising sections 76 to 123,
had been wholly replaced by the Sales of Goods Act, 1930. The word goods is defined
in Section 2(7) of the Sales of Goods Act as every kind of movable property other than
actionable claims and money; and includes stock and shares, growing crops, grass, and
things attached, to or forming part of the land which are agreed to be severed before sale
or under the contract of sale.
Thus understood goods to fall within the purview of Section 171 of the Contract Act
should have marketability and the person to whom it is bailed should be in a position to
dispose it of in consideration of money. In other words the goods referred to in Section
171 of the Contract Act are saleable goods. There is no scope for converting the case files
into money, nor can they be sold to any third party. Hence, the reliance placed on Section
171 of the Contract Act has no merit.
In England the solicitor had a right to retain any deed, paper or chattel which has come
into his possession during the course of his employment. It was the position in common
law and it later recognized as the solicitors right under Solicitors Act, 1860. In Halsburys
Laws of England, it is stated thus (vide paragraph 226 in volume 44): 226. Solicitors
rights. At common law a solicitor has two rights which are termed liens. The first is a
right to retain property already in his possession until he is paid costs due to him in his
professional capacity, and the second is a right to ask the court to direct that personal
property recovered under a judgment obtained by his exertions stand as security for his
costs of such recovery. 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 costs of the suit, matter or proceeding prosecuted or defended by him.
Before India attained independence different High Courts in India had adopted different
views regarding the question whether an advocate has a lien over the litigation files kept
with him. In P. Krishnamachariar vs. The Official Assignee of Madras, (AIR 1932
Madras 256) a Division Bench held that an advocate could not have such a lien unless
there was an express agreement to the contrary. The Division Bench has distinguished an
earlier decision of the Bombay High Court in Tyabji Dayabhai & Co. vs. Jetha Devji &
Co. (AIR 1927 Bombay 542) wherein the English law relating to the solicitors lien was
followed. Subsequently, a Full Bench of the Madras High Court in 1943 followed the
decision of the Division Bench. A Full Bench of the Patna High Court in In re B.N.
Advocate in the matter of Misc. Judl. Case No.18/33 (AIR 1933 Pat 571) held the view
that an advocate could not claim a right to retain the certified copy of the judgment
obtained by him on the premise that an appeal was to be filed against it. Of course the
Bench said that if the client had specifically instructed him to do so it is open to him to
keep it.
After independence the position would have continued until the enactment of
the Advocates Act 1961 which has repealed a host of enactments including Indian Bar
Council Act. When the new Bar Council of India came into existence it framed Rules
called the Bar Council of India Rules as empowered by the Advocates Act. Such Rules
contain provision specifically prohibiting an advocate from adjusting the fees payable to
him by a client against his own personal liability to the client. As a rule an Advocate shall
not do anything whereby he abuses or takes advantage of the confidence reposed in him
by his client,(vide Rule
24). In this context a reference can be made to Rules 28 and 29 which are extracted
below:
28. After the termination of the proceeding, the Advocate shall be at liberty to appropriate
towards the settled fee due to him, any sum remaining unexpended out of the amount
paid or sent to him for expenses, or any amount that has come into his hands in that
proceeding.
29. Where the fee has been left unsettled, the Advocate shall be entitled to deduct, out of
any moneys of the client remaining in his hands, at the termination of the proceeding for
which he had been engaged, the fee payable under the rules of the Court, in force for the
time being, or by then settled and the balance, if any, shall be refunded to the client.
Thus, even after providing a right for an advocate to deduct the fees out of any money of
the client remaining in his hand at the termination of the proceeding for which the
advocate was engaged, it is important to notice that no lien is provided on the litigation
files kept with him. In the conditions prevailing in India with lots of illiterate people
among the litigant public it may not be advisable also to permit the counsel to retain the
case bundle for the fees claimed by him. Any such lien if permitted would become
susceptible to great abuses and exploitation.

There is yet another reason which dissuades us from giving approval to any such lien. We
are sure that nobody would dispute the proposition that the cause in a court/tribunal is far
more important for all concerned than the right of the legal practitioner for his
remuneration in respect of the services rendered for espousing the cause on behalf of the
litigant. If a need arises for the litigant to change his counsel pendente lite, that which is
more important should have its even course flowed unimpeded. Retention of records for
the unpaid remuneration of the advocate would impede such course and the cause
pending judicial disposal would be badly impaired. If a medical practitioner is allowed a
legal right to withhold the papers relating to the treatment of his patient which he thus far
administered to him for securing the unpaid bill, that would lead to dangerous
consequences for the uncured patient who is wanting to change his doctor. Perhaps the
said illustration may be an over-statement as a necessary corollary for approving the lien
claimed by the legal practitioner. Yet the illustration is not too far-fetched. No
professional can be given the right to withhold the returnable records relating to the work
done by him with his clients matter on the strength of any claim for unpaid remuneration.
The alternative is that the professional concerned can resort to other legal remedies for
such unpaid remuneration.

A litigant must have the freedom to change his advocate when he feels that the advocate
engaged by him is not capable of espousing his cause efficiently or that his conduct is
prejudicial to the interest involved in the lis, or for any other reason. For whatever reason,
if a client does not want to continue the engagement of a particular advocate it would be a
professional requirement consistent with the dignity of the profession that he should
return the brief to the client. It is time to hold that such obligation is not only a legal duty
but a moral imperative.

In civil cases, the appointment of an advocate by a party would be deemed to be in force

until it is determined with the leave of the court, (vide order 3, Rule 4(1) of the Code of
Civil Procedure). In criminal cases, every person accused of an offence has the right to
consult and be defended by a legal practitioner of his choice which is now made a
fundamental right under Article 22(1) of the Constitution. The said right is absolute in
itself and it does not depend on other laws. In this context reference can be made to the
decision of this Court in State of Madhya Pradesh vs. Shobharam and ors. (AIR 1966 SC
1910). The words of his choice in Article 22(1) indicate that the right of the accused to
change an advocate whom he once engaged in the same case, cannot be whittled down by
that advocate by withholding the case bundle on the premise that he has to get the fees for
the services already rendered to the client.

If a party terminates the engagement of an advocate before the culmination of the

proceedings that party must have the entire file with him to engage another advocate. But
if the advocate who is changed midway adopts the stand that he would not return the file
until the fees claimed by him is paid, the situation perhaps may turn to dangerous
proportion. There may be cases when a party has no resource to pay the huge amount
claimed by the advocate as his remuneration. A party in a litigation may have a version
that he has already paid the legitimate fee to the advocate. At any rate if the litigation is
pending the party has the right to get the papers from the advocate whom he has changed
so that the new counsel can be briefed by him effectively. In either case it is
impermissible for the erstwhile counsel to retain the case bundle on the premise that fees
is yet to be paid.

Even if there is no lien on the litigation papers of his client an advocate is not without
remedies to realise the fee which he is legitimately entitled to. But if he has a duty to
return the files to his client on being discharged the litigant too has a right to have the
files returned to him, more so when the remaining part of the lis has to be fought in the
court. This right of the litigant is to be read as the corresponding counterpart of the
professional duty of the advocate.

Misconduct envisaged in Section 35 of the Advocates Act is not defined. The section
uses the expression misconduct, professional or otherwise. The word misconduct is a
relative term. It has to be considered with reference to the subject matter and the context
wherein such term occurs. It literally means wrong conduct or improper conduct.

Corpus Juris Secundum, contains the following passage at page 740 (vol.7):

Professional misconduct may consist in betraying the confidence of a client, in

attempting by any means to practise a fraud or impose on or deceive the court or the
adverse party or his counsel, and in fact in any conduct which tends to bring reproach on
the legal profession or to alienate the favourable opinion which the public should
entertain concerning it.
The expression professional misconduct was attempted to be defined by Darling, J., in In
re A Solicitor ex parte the Law Society [(1912) 1 KB 302] in the following terms:
It it is shown that an Advocate in the pursuit of his profession has done something with
regard to it which would be reasonably regarded as disgraceful or dishonourable by his
professional brethren of good repute and competency, then it is open to say that he is
guilty of professional misconduct.
 In this context it is to be mentioned that the aforesaid definition secured approval by the
Privy Council in George Frier Grahame vs. Attorney-General, Fiji,(1936 PC 224). We are
also inclined to take that wide canvass for understanding the import of the expression
misconduct in the context in which it is referred to in Section 35 of the Advocates Act.
We, therefore, that the refusal to return the files to the client when he demanded the same
amounted to misconduct under Section 35 of the Act. Hence, the appellant in the present
case is liable to punishment for such misconduct.
However, regarding the quantum of punishment we are disposed to take into account two
broad aspects: (1) this court has not pronounced, so far, on the question whether advocate
has a lien on the files for his fees. (2) the appellant would have bona fide believed, in the
light of decisions of certain High Courts, that he did have a lien. In such circumstances it
is not necessary to inflict a harsh punishment on the appellant. A reprimand would be
sufficient in the interest of justice on the special facts of this case.
We, therefore, alter the punishment to one of reprimanding the appellant. However, we
make it clear that if any advocate commits this type of professional misconduct in future
he would be liable to such quantum of punishment as the Bar Council will determine and
the lesser punishment imposed now need not be counted as a precedent.
Appeal is disposed of accordingly.
Ttw//,,
Facts of RD Saxena v Balram Prasad Sharma

Facts
 In this situation, the appellant was an advocate and also served as a legal advisor to the Madhya
Pradesh State Cooperative Bank Ltd.
 The bank hired him to handle legal matters in which the bank was involved.
 However, the bank ended his position and asked him to give back the files related to the bank.
 Instead of returning the files, the lawyer refused and insisted that the bank first pay him his due
remunerations for his legal services.
 The bank needed the files for ongoing legal cases, but they disagreed with the lawyer's demands,
considering them unreasonable.
 As a result, the Managing Director of the Bank filed a complaint with the State Bar Council
(Madhya Pradesh) on 3rd February 1994.
 The complaint accused the lawyer of professional misconduct for not returning the files.
 During the proceedings, the lawyer admitted to not returning the files but argued that he had the
right to keep them using his right of lien.
 He offered to return the files once the bank paid him for his legal work.

 Background:
In 1990, R.D. Saxena was appointed as a legal advisor to the Madhya Pradesh State Co-operative
Bank Ltd. As part of his duties, he conducted several legal cases on behalf of the bank. His
 engagement with the bank was terminated on July 17, 1993. The bank subsequently requested
Saxena to return all case files related to its ongoing and closed cases.
 Dispute over Fees:
Instead of returning the files, Saxena demanded the payment of ₹97,100 as his unpaid legal fees.
He claimed that until his dues were cleared, he would retain the case files, asserting a right of
lien over the documents. The bank refused to meet his financial demands, calling them
unreasonable.
 Filing of Complaint:
On February 3, 1994, the Managing Director of the bank filed a complaint with the Madhya
Pradesh State Bar Council, accusing Saxena of professional misconduct for not returning the
files. Saxena admitted to withholding the files but justified his actions by asserting that he had a
right of lien over the files due to unpaid fees.
 Disciplinary Proceedings:
The Bar Council of Madhya Pradesh transferred the case to the Disciplinary Committee of the
Bar Council of India under Section 36-B of the Advocates Act, 1961. After conducting an
inquiry, the Disciplinary Committee found Saxena guilty of professional misconduct. It imposed
a fine of ₹1,000 on Saxena and debarred him from practising as an advocate for 18 months.
Saxena was also directed to return all the case files without any delay.
 Appeal to Supreme Court:
Saxena appealed the decision of the Bar Council of India before the Supreme Court, raising
important legal questions regarding an advocate’s right to claim a lien over case files for unpaid
fees.
Issues Raised
The primary legal issue in RD Saxena v Balram Prasad Sharma before the Supreme Court was:
 Can an advocate claim a lien on the litigation papers entrusted to him by a client for unpaid fees?
 Whether case files can be equated with “goods” under Section 171 of the Indian Contract Act,
1872?
 Does the retention of case files amount to professional misconduct under Section 35 of the
Advocates Act, 1961?
 Does an advocate have the right to withhold case files under the provisions of Rules 28 and
29 framed by the Bar Council of India under the Advocates Act, 1961?
Arguments by the Appellant (R.D. Saxena)
1. Right of Lien under Section 171 of the Indian Contract Act, 1872:
Saxena argued that under Section 171, he had the right to retain the case files as a security for
unpaid fees. Section 171 of the Indian Contract Act, 1872 provides that “bankers, factors,
wharfingers, attorneys of a High Court and policy-brokers” may retain goods bailed to them for
unpaid fees. He contended that, as an attorney, he was entitled to hold on to the case files until
his dues were cleared.
2. Miscarriage of Justice by the Bar Council of India:
Saxena contended that the Bar Council of India failed to consider his defence based on his
claimed right of lien. He argued that the disciplinary action against him amounted to a
miscarriage of justice as his legitimate claims for unpaid fees were ignored.
3. Previous Precedents on Lien:
Saxena cited decisions from various High Courts where it was held that attorneys have a right of
lien over goods or documents entrusted to them by clients. He asserted that his actions were
based on a bona fide belief that he had the legal right to retain the files.
 Arguments by the Respondent (Bank)
1. No Right of Lien on Litigation Papers:
The respondent argued that case files and litigation papers do not qualify as “goods”
under Section 171 of the Indian Contract Act, 1872. Therefore, an advocate cannot claim a lien
over such documents. The respondent emphasised that an advocate’s duty is to return the case
files to the client upon termination of the professional relationship, irrespective of unpaid fees.
2. Professional Misconduct:
The bank contended that Saxena’s refusal to return the case files amounted to professional
misconduct under Section 35 of the Advocates Act, 1961. The advocate-client relationship is
based on trust, and withholding essential documents related to legal proceedings is a breach of
that trust. The respondent maintained that Saxena’s conduct harmed the bank’s legal interests
and delayed ongoing legal proceedings.
Court’s Observations and Reasoning in RD Saxena v Balram Prasad Sharma
The Supreme Court, led by Justice K.T. Thomas, made the following key observations:
1. No Right of Lien on Case Files:
The Court rejected Saxena’s claim of lien over the case files. It clarified that Section 171 of the
Indian Contract Act, 1872 applies to “goods” that are bailed to a professional for a specific
purpose. However, case files and litigation papers cannot be classified as “goods” under this
provision, as they hold no intrinsic marketable value. Goods, as defined in the Sale of Goods
Act, 1930, refer to movable property that can be sold or transferred. Case files do not fit this
definition, as they are neither saleable nor can they be converted into money.
2. Bailment Does Not Apply:
The Court further ruled that the concept of bailment, as defined under Section 148 of the
Indian Contract Act, does not apply to case files. Bailment involves the delivery of goods for a
specific purpose with an obligation to return the goods after the purpose is fulfilled. However,
the relationship between an advocate and a client, particularly regarding case files, does not
constitute bailment, as the files are not goods delivered with a contractual obligation for return.
3. Professional Misconduct:
The Court emphasised that withholding case files for unpaid fees could severely harm a client’s
ability to pursue ongoing legal matters. An advocate has a duty to return case files upon
termination of professional engagement, and failure to do so constitutes professional misconduct
under Section 35 of the Advocates Act, 1961. The Court reiterated that an advocate’s
relationship with a client is fiduciary, and the advocate’s duty to the client takes precedence over
financial disputes.
4. Right to Change Advocates:
The Court highlighted that under Article 22(1) of the Indian Constitution, an accused person has
the fundamental right to be represented by an advocate of their choice. This right implies that a
litigant must have the freedom to change advocates if they so desire. Allowing an advocate to
retain case files for unpaid fees would infringe on this fundamental right.
5. Rules 28 and 29 of the Advocates Act:
The Court referred to Rules 28 and 29 framed by the Bar Council of India under the Advocates
Act, 1961. These rules allow an advocate to appropriate any unspent amount left in their hands
after the conclusion of a case or deduct unpaid fees from the client’s money. However, these
rules do not grant advocates the right to retain case files or litigation papers for unpaid fees. Any
dispute over fees must be resolved separately through legal remedies, without impeding the
client’s access to their case documents.
 6. The Supreme Court stated that files and records held by an advocate do not qualify as
"goods" that can be withheld for unpaid fees.
7. The term "goods" is defined in the Sale of Goods Act, 1930 and do not include legal
records.
8. The concept of bailment, defined in Section 148 of the Indian Contract Act, 1872
involves delivering goods with an agreement for their return, which do not apply to legal
files.
9. The court emphasized that withholding records for unpaid fees could harm the client's
case.
10. Advocates should not have the right to withhold records due to unpaid fees; instead,
they can pursue legal remedies for payment.
11. If a client changes advocates, the former must return the case files, and disputes over fees
should be resolved separately.
12. The court stressed the social duty of the legal profession to support people, ensuring
they are not deprived of their rights due to an advocate's position.
13. While advocates can set fees by agreement, unpaid fees do not justify withholding client
documents.
14.
RD Saxena v Balram Prasad Sharma Judgement
The Supreme Court upheld the decision of the Bar Council of India, finding R.D. Saxena guilty
of professional misconduct for refusing to return the case files. However, the Court recognised
that there were no prior Supreme Court precedents on this issue and acknowledged Saxena’s
possible bona fide belief that he had a right of lien. Therefore, the Court reduced the severity of
the punishment. Instead of debarment from practice for 18 months, the Court issued
a reprimand to Saxena.
The Court also clarified that the lighter punishment in this case should not be taken as a
precedent for future cases. In the future, any advocate found guilty of similar misconduct would
face stricter penalties.
Conclusion
The Supreme Court’s decision in R.D. Saxena v Balram Prasad Sharma is a landmark
judgement that establishes clear boundaries for the professional conduct of advocates. The Court
ruled that an advocate cannot claim a lien on litigation papers for unpaid fees, as such papers are
not “goods” under the Indian Contract Act, 1872. The decision emphasised the ethical
responsibilities of advocates and the fiduciary nature of the advocate-client relationship.
The case serves as an important precedent, ensuring that clients are not deprived of their legal
rights due to financial disputes with their advocates. It also underscores the need for advocates to
resolve disputes over fees through proper legal channels, without withholding crucial legal
documents from their clients. The ruling reinforces the ethical standards expected from members
of the legal profession, safeguarding the interests of litigants and promoting fairness in the legal
process.