RETAINER

FIRM 7
DEFINITION

• The definition of a retainer is highlighted in the case of Ragot &

Company Advocates V West Kenya Wholesalers Ltd
[2006] KEHC 2734 (KLR), where Warsame J quoted Black's Law
Dictionary 6th edition 1990, which defines it as:
“In the practice of law, when a client hires an attorney to represent him, the
client is said to have retained the Attorney. This act of employment is called the
retainer. The retainer agreement between the client and attorney sets forth the
nature of services to be performed, costs, expenses and related matters.”
CONT(I)…

• The ruling also references the 2nd edition volume 4 of the

Black’s Law Dictionary by J. B. Saunders, to define a retainer as:
“The act of authorizing or employing a solicitor to act on behalf of a
client constitutes the solicitor being retained by that client,
consequently the giving of a retainer is equivalent to the making of a
contract for the solicitor’s employment.”
CONT(II)…

Black's Law Dictionary (9th ed. 2009) defines a retainer to include:

• A client's authorization for a lawyer to act in a case, for example, where
the attorney needed an express retainer before making a settlement offer.
• A fee that a client pays to a lawyer simply to be available when the client
needs legal help during a specified period or on a specified matter.
• A lump-sum fee paid by the client to engage a lawyer at the outset of a
matter, also termed as an engagement fee.
• An advance payment of fees for work that the lawyer will perform in the
future, also termed as a retaining fee.
THE NATURE OF A RETAINER

In the case of Njougoro & Company Advocates v Dubai Bank Kenya Limited
[2008] KEHC 940 (KLR), the court makes reference to Halsbury's Laws of
England fourth edition Reissue volume 44(i) butter worths London 1995,
specifically page 84 paragraph 101 on the form of retainer. It is stated:
“A retainer need not be in writing in laws under the general laws of contract
the terms of the retainer or the disability of a party to it make writing
requisite for example where the retainer really amounts to a contract of
guarantee …….”
NATURE CONT’

• The ruling emphasized that the definition of a retainer, both in text and
case law, clearly indicates it is an agreement that must exist, and it is not
enough to claim services were rendered without such retainer being
proven. The retainer thus forms the basis of the contractual relationship
binding the advocate to represent the client and the client to pay for the
services rendered under that agreement. In essence, the court treats a
retainer as a contractual relationship establishing duties and payment
obligations between advocate and client.
IS IT ETHICAL TO BE ON A RETAINER?

• An advocate has a duty to their client. Such duty, with respect to a retainer,
are provided for by the LSK Standards of Professional Practice and Ethical
Conduct as well as the overriding principles of professional practice. A
retainer, therefore, has to abide by the provisions set out, specifically:
a) Professionalism
b) SOPPEC-3: Competence and diligence in client care
c) SOPPEC-5: Fiduciary duty over client’s funds and other property
d) SOPPEC-12, Honesty and Integrity
CONT’
• The Advocates Act, specifically Section 45 on Agreements with respect to
Remuneration and Section 46 on Invalid Agreements, dictate that retainers
are accepted as long the terms are reasonable, fair, ethical, and conform to
the provisions in the Advocates Remuneration Order to prevent instances
of undercutting and contingency fees, which are unacceptable in the legal
profession. It also gives an avenue for a client to seek redress from the
Court where they view a retainer to be harsh and unconscionable,
exorbitant or unreasonable.
WHAT IS THE EFFECT OF A RETAINER ON AN ADVOCATE’S MORALE?
(SHOULD CLIENTS PAY FEES THROUGH RETAINERS SO AS TO
MOTIVATE AND/OR COMPEL THEIR ADVOCATES TO HANDLE SUITS?)

• From the point of law as a business, its effect on an advocate’s morale is

fundamentally positive, as it provides the essential element of financial security
necessary for professional motivation and performance.
• A retainer immediately formalizes the client-advocate relationship, converting a
potential client into an actively engaged client. This upfront payment secures the
advocate's resources, such as their time and money spent on the matter, and
demonstrates the client's serious commitment, ensuring the firm does not have to
expend its capital chasing fees.
• This guaranteed payment reduces financial anxiety, allowing the advocate to focus on
the merit of the case rather than the collectability of the bill, thus boosting morale and
the ability to dedicate full professional attention to the client's matter.
 MODES OF
RETAINER
JOHN NYAMAI
1. GENERAL (TRADITIONAL) RETAINER

Secures the services of an advocate in the provision of legal services in ordinary and non-
contentious business.
• Runs indefinitely, and the advocate may ask for payment from time to time.
• Ends upon notice of termination by either party.
Advantages:
Immediate accessibility of legal advice and representation
Priority in service
Cost efficiency
Flexibility
2. SPECIFIC RETAINER

• Subsists for a specific reason, for example, a specific litigation.

• Duration depends on that of the specific activity.
• Agreed fee
• Detailed agreement (scope, fee etc., are outlined in the agreement)
Advantages:
Clarity and predictability
Focused representation
Client commitment
3. EXPRESS RETAINER

A mutual agreement between the parties. Can be:

• Written retainer: reduced in writing and signed by the client or their
representative.
• Oral retainer: It is advisable to reduce oral retainers to writing since the
advocate will bear the burden of proving the existence of a retainer
where a dispute arises.
4. HYBRID RETAINER

Blends two or more of the other modes of retainer, for example, oral and
written.
• Flat fee with hourly billing: the advocate charges an upfront flat fee for
certain services like drafting a contract. Any additional work will be billed
at an hourly rate.
• Blended hourly rate: Calculate the average hourly billable for all the work
performed, regardless of the task or advocate involved.
5. IMPLIED RETAINER

Arises where there is no express agreement in writing or orally.

• Ratification: The advocate acts without instruction or under assumption of
authority and the client ratifies the advocate’s actions by instructing
him/her to continue.
• Party performance: The client performs part of the retainer.
AUTHORITY OF AN
ADVOCATE ON
RETAINER
THE AGENCY RELATIONSHIP

• An advocate-client relationship is one of agency.

• Section 2 Advocates Act: A ‘client’ includes any person who, as a principal, has power to retain or
employ an advocate.
• A principal is bound by his agent’s actions when done with actual or apparent authority.
• An advocate as an agent has the authority or capacity to enter into legal relations with third
parties on behalf of the principal
• An advocate’s authority can be
a. Express
b. Implied
c. Usual
d. Apparent
1. EXPRESS AUTHORITY

• Terms of the retainer dictate the scope of the advocate’s representation

• An advocate can incur costs and disbursements to be billed to the client
• The authority to institute proceedings has to be express, rather than
implied
• An advocate has the implied authority to further clients’ interests by
compromising unless client directs otherwise.
CONT.

CASE: J Mbugua Mburu & Associates v City Star Shuttle Ltd (2021), Para 19;
• It is however clear that advocates can only act in a matter where they have
been instructed either expressly or by implication. Where there is a general
retainer given to an advocate by a client, it does not fall in the mouth of the
client to argue that there were no instructions given to the advocate in
respect of a particular matter falling within the series in which there was a
general retainer unless it is shown that there were express instructions given
to the advocate not to act in that particular matter. In that event the onus of
proving lack of instruction would be on the person alleging the same.
2. IMPLIED AUTHORITY

• Not explicitly stated but inferred from the nature of the advocate-client relationship or
conduct of parties.
• Necessary to carry out the express authority granted.
• Can be limited by notice by the client
CASE: Ochieng Onyango and Kibet & Ohaga Advocates vs Akiba Bank Limited (2007);
“The act of authorizing an Advocate to act on behalf of a client constitutes the
Advocate’s retainer by the client. It is not the law that an Advocate must obtain a
written authority from the client before he commences a matter. The participation
and authority of an Advocate in a matter can be implied or discerned from the
conduct of the client.”
3. USUAL AUTHORITY

• Is the authority typical of an advocate’s ordinary course of business.

• Based on standard practices and professional norms
• Examples: communications with opposing counsels and negotiating settlements.
CASE: Kilonzo & Azizi Company Advocates v County Government of Kilifi
[2021] KEELC 3523 (KLR)
Authority of an advocate on record to enter a consent on behalf of the Applicant: “It is the same Ms
Wasi who executed the impugned consent some two months after she came on
record for the Applicant. As it were, there is no allegation of fraud or coercion made
by the Applicant against the said Advocate. Nor has the said Ms. Wasi herself filed
any affidavit herein alleging that she was misled or coerced into entering the
consent.”
4. APPARENT AUTHORITY (OSTENSIBLE)

• Arises when a third party reasonably believes that an advocate has the authority to act
on behalf of a client based on the client’s representations or conduct.
• Binds the client even where the advocate does not have
CASE: Mutua Waweru & Co. Advocates v Gilphine Mokeira Omwenga & another
[2022] KEHC 2048 (KLR): Para 12:
The 1st respondent signed on both, the petition and the affidavit sworn in
support of it, to authenticate the two documents. On the face of it, the
1st respondent endorsed the petition and its filing, and, therefore, acquiesced to
the process, by so doing, she, ostensibly, by conduct, had retained or instructed
the applicant to draft and file the petition.
CASE LAWS
NOCTON VS. LORD ASHBURTON [1914] AC
932
• Fiduciary Duty
• Lord Ashburton bought property for £60,000 on Church street.His solicitor was Nocton
who advised him to lease part of the house.
• This was a bad idea because Nocton knew that this would result to the security being
insufficient.
• Lord Ashburton alleged that the advice was not given in good faith but rather in Mr.
Nocton’s self-interest.
• Holding: Nocton was liable for his bad advice given the fiduciary relationship between the
solicitor and the client thus he could not claim for the retainer fee from the client.
KING WOOLEN MILLS LTD & ANOR VS. KAPLAN
AND STRATTON ADVOCATES CIVIL APP NO.55/93

• The retainer creates a fiduciary relationship between client and advocate

• Knowledge acquired by the advocate while acting for the client is
confidential and should not be disclosed to anyone without the consent of
the client.
• That fiduciary relationship exists even after the conclusion of the matter
for which the retainer was created.
RE STORER (1884) 26 CH D 189

• A retainer limits the authority of an advocate.

• There is no general relationship for all time purposes.
• The exception is a general retainer
LIMITS OF THE
RETAINER
MARK MUCHERA
WHO A RETAINER CAN REPRESENT

• An advocate is restricted from representing just any client due to the

potential for a conflict of interest. They are guided by SOPPEC-6 on
conflict of interest.
• An advocate must therefore avoid situations that may lead to conflicts, as
highlighted in cases like King Woolen Mills Ltd v M/s Kaplan & Straton
Advocates.
CONT.

• Another limitation is that the retainer should not represent a client

beyond his knowledge of expertise.
• This is with guidance from SOPPEC-3 on competence and diligence in
client care, whereby an advocate has a duty to represent their client to
the best of their capabilities.
HOW MUCH A RETAINER CAN CHARGE

• The amount of money a retainer is to charge is limited by the Advocates

Remuneration Order,.
• An advocate should not undercut or charge contingency fees in a retainer
agreement. This position is cemented by provisions from the Advocates Act,
specifically Sections 45 and 46 that provide on Agreements with respect to
Remuneration and Invalid Agreements respectively.
• It is also important to view Common Law cases that place limits on retainers,
specifically the cases Waugh v HB Clifford & Sons Ltd (1982) 1 All ER 1095 CA
as well as Groom v Croker (1939) 1 KB 194 (1938) 2 All ER 394
WAUGH V HB CLIFFORD & SONS LTD (1982) 1 ALL
ER 1095 CA
• The Plaintiffs in this case, who were the purchasers of defective houses, sued the
building company, HB Clifford & Sons Ltd, the first defendants, for negligence and
breach of contract. An agreement to compromise was negotiated through
solicitors, where the company would repurchase the houses.
• Although the company internally instructed their solicitors, Boys & Maughan, who
were the second defendants, not to finalize the deal, their solicitor, due to an
internal error, was not informed in time and subsequently gave final written
approval to the compromise terms.
• The company's subsequent attempt to withdraw its instructions was challenged
by the plaintiffs in a second action seeking specific performance.
CONT (I) …

• The court reasoned that the solicitors, by virtue of their position, has an apparent
authority to compromise a claim on behalf of their client. The plaintiffs' solicitor,
Williamson & Barnes, was entitled to rely on the apparent authority of the defendants'
solicitor to conclude the settlement.
• The court explained that while the defendant's solicitor had acted in breach of their duty
to their own client by disregarding their express instructions, which was a clear violation
of the retainer, this did not affect the validity of the settlement with the opposing party.
• The third party, in this case, the plaintiffs, had no knowledge of the limitation placed on
the solicitor's authority and was entitled to assume that the solicitor had the usual, which
is the apparent authority to settle the case.
CONT (II)…

• This case outlines the distinction between an advocate’s actual authority,

which is what the client has explicitly permitted, and their apparent or
ostensible authority, which is what a third party would reasonably believe
the advocate’s authority to be.
• It also highlights the legal principle that a client can be bound by an advocate
who appears to have the authority to act, even if that authority has been
secretly revoked.
• The significance of Waugh v HB Clifford & Sons Ltd in relation to the limits of a
retainer is twofold:
CONT (III)…

1. Internal vs. External Authority - It distinguishes between the solicitor's actual

authority under the retainer, which was limited by the client's instructions, and their
apparent authority as perceived by the outside world, which was by the plaintiffs in this
case.
2. Professional Responsibility - While the settlement was upheld, the solicitor was still
liable to their own client for any loss caused by their breach of the retainer. This
underscores the professional and ethical obligation to act within the client's instructions.
• The case also serves as a stark reminder to advocates of the importance of the principle
of clear communication with their clients regarding settlement negotiations and the
potential consequences of acting without or against instructions.
GROOM V CROKER (1939) 1 KB 194 (1938) 2 ALL ER
394
• The plaintiff, Mr. Groom, sought damages against a law firm, Messrs. William Charles Crocker,
the first defendant, and an insurance company, National Farmers Union Mutual Insurance
Society Ltd, the second defendant, for negligence, breach of duty, and libel.
• The plaintiff had been involved in a car accident where his brother was injured, and his
brother later sued both the plaintiff and the other driver. The plaintiff’s insurance policy
allowed the insurance company to control the legal proceedings, and they appointed the first
defendant to handle the case.
• However, the law firm acted solely in the interest of the insurance company and did not
consult the plaintiff, submitting a defense without his consent, which admitted negligence. As a
result, the plaintiff lost the case and was ordered to pay damages, causing him financial loss
and reputational harm.
CONT (I)…

• The plaintiff argued that the first defendant, as his legal representative, had a duty to
protect his interests and that their failure to do so led to the loss of his no-claim bonus,
difficulties in obtaining future insurance, and damage to his reputation as a negligent driver.
• He also claimed damages for libel against the law firm for admitting negligence without his
knowledge and against the insurance company for a letter that suggested there was a risk
the court would find him negligent, despite his belief that he was not at fault.
• The court found that the first defendants had been guilty of negligence or breach of duty,
and assessed the damages under that head at 1000 pounds, and that the words used by
the first defendants were defamatory and had been spoken with an indirect motive, and
assessed the damages for libel.
CONT (III)…

• The court also made it clear that a solicitor-client relationship existed between Mr.
Groom and the solicitors, notwithstanding that they were instructed and paid by
the insurance company.
• This case covers the authority for the proposition in that when you act for an
insurance company, you acquire two clients - both the insurer but also the insured
- and you owe a duty to protect the interests of both.
• The core of the court's reasoning was that the retainer was with Mr. Groom, the
insured. The solicitors' duty was to act in his best interests. By admitting negligence
without his consent and against his instructions, they had fundamentally breached
this duty.
CONT (IV)…

• The fact that the insurance company had a contractual right to control the proceedings did
not entitle them to instruct the solicitors to act in a way that was detrimental to the insured's
interests, particularly his reputation.
• The implications of Groom v Croker for the limits of a retainer are:
1. Primacy of the Client's Interest - It establishes that an advocate's professional and
ethical duty to the client they are representing (the insured) is paramount and cannot be
overridden by the interests or instructions of a third party who is paying for their services
(the insurer).
2. Conflict of Interest - The insurer's interest was to dispose of the claim as cheaply and
quickly as possible, even if it meant admitting liability on behalf of the insured.The insured's
CONT (V)…

interest was to defend his reputation and avoid a finding of fault. The advocate's duty
was to navigate this conflict in favour of their client, the insured.
3. Informed Consent - The ruling implicitly underscores the necessity for an
advocate to obtain the client's informed consent for any significant step in the
litigation, such as admitting liability.
• In conclusion, while an advocate possesses a degree of implied and apparent
authority in the conduct of a case, this authority is ultimately subservient to their
fundamental ethical obligations to act in their client's best interests, to follow their
client's instructions, and to avoid any and all conflicts of interest. Trust and confidence
placed in legal practitioners by their clients form the very bedrock of the advocate-
client relationship.
ACTS GENERALLY AUTHORIZED UNDER RETAINER

• These are actions that fall within the scope of an advocate's professional
duty to carry out the client's instructions and protect the client's
interests.
• This authority can either be express or implied.
EXPRESS AUTHORITY

1. Providing Specific Legal Services - Performing the particular work for

which the advocate was hired. This includes filing a lawsuit, drafting
legal documents, negotiating a contract, or handling a specific
conveyancing or commercial transaction.
2. Advising the Client - Offering legal opinions, explaining the law, and
advising on the best course of action.
3. Representing the Client - Appearing in court, at tribunals, or at
mediation/negotiation sessions.
IMPLIED AUTHORITY

• Even without explicit mention, the law generally implies that an advocate
has authority to take all steps that are incidental to the proper conduct of
the matter.
 CONT (I)…
Impliedly Authorized What It Includes Key Limitation
Acts
Pleadings and Preparing, signing, and serving court Cannot admit negligence or
Documentation documents, notices, and liability without the client's
correspondence in the course of express consent (as highlighted
litigation. in cases like Groom v Crocker).

Incurring Routine Costs Incurring reasonable and necessary Must still keep the client
costs and disbursement, such as court informed and consult on
fees, photocopying, expert witness major expenses.
fees, required to advance the client's
case.
 CONT (II)…
Compromise/Settlement Accepting or rejecting offers of Cannot settle the entire claim or
compromise or settlement during make a major concession against
litigation on matters of procedure the client's known wishes. The
or where instructions cannot be decision to settle belongs to the
reasonably obtained. client (as seen in the case of
Waugh v HB Clifford & Sons Ltd)

Procedural Steps All necessary steps to conduct the Must act in a manner that protects
proceedings effectively, such as applying the client's overall interests and isn’t
for extensions of time and consenting prejudicial to the client's substantive
to procedural orders. rights.
Receiving Money Receiving money from an opposing The advocate must hold the funds in
party or third party, such as a a trust account, or a client account,
settlement amount, on the client's and account for them to the client.
behalf.
 CONT (III)…
Conduct of the Trial Deciding the tactics and Cannot depart from the
strategy in court, such as express instructions on
which witnesses to call, the the main objective or
order of evidence, how to ultimate result of the
cross-examine, and what
case.
objections to raise.
Binding the Client The advocate's actions, Cannot agree to refer the
submissions, and omissions in the dispute to a form of
courtroom, such as conceding a arbitration or mediation that
point of law or failing to object was not previously authorized.
to evidence, will generally bind
the client to the court.
ACTS GENERALLY NOT AUTHORIZED

• An advocate's retainer does not generally confer authority to take actions that
affect the client's fundamental rights or property without express, specific
instructions.These include:
1. Commencing Legal Proceedings - An advocate does not have implied
authority to institute legal proceedings on a client's behalf. This requires clear
and specific instruction.
2. Varying the Retainer - An advocate cannot unilaterally change the scope of
the services or the agreed-upon fee structure.
3. Selling or Buying Property - An advocate cannot sell, purchase, or otherwise
dispose of the client's property outside the explicit terms of the retainer.
CONT.

4. Making a Substantial Admission - An advocate cannot make a

material admission of fact or liability that determines the outcome of
the case without the client's express consent, such as in the case of
Groom v Crocker.
DURATION UNDER
WHICH A RETAINER
SHOULD LAST
GILBERT MAINA
Generally, the duration of retainers is until the conclusion of
the matter for which an advocate is retained.

Nevertheless, the parties to a retainer agreement may agree

as to the duration of the agreement. However, the duration
of the retainer depends on the existence of the advocate-
client relationship. Where the advocate-client relationship
still subsists, the advocate is obligated to discharge his/her
duties to the client.
In the case of an advocate who is employed by a company,
the retainer is dependent on the salary. It is there so long as
the advocate is earning salary which is consideration for the
work done.
The retainer may be terminated by the operation of law
where the contract has become illegal or where one of the
parties dies.
Danish Mercantile Co. Ltd v Beaumont (1951) ALL ER
925

Regarding the reasonable duration for an unauthorized act

to proceed under a retainer, what Jenkins LJ was pointing
to is that there isn't a fixed time limit. Instead, the duration
is governed by the equitable principle of reasonable time
for the client to ratify the solicitor's unauthorized actions.
CAPACITY TO RETAIN AN
ADVOCATE
BRIAN OKELLO
1. CLIENT

• Section 2 of the Advocates Act gives the following definition:

• "client” includes any person who, as a principal or on behalf of another, or

as a trustee or personal representative, or in any other capacity, has
power, express or implied, to retain or employ, and retains or employs, or
is about to retain or employ an advocate and any person who is or may
be liable to pay
CONT (I)…

• This means that an advocate and client relationship requires no

formalities to come into existence.
• If the person who approaches the advocate falls into the scope of the
definition above of a client, he or she qualifies to retain an advocate.
• The client can therefore create a contractual relationship, a relationship
that is not ‘tripartite', which means that each client has a separate
retainer relationship with the common advocate"
2. ADVOCATE

• An advocate can not retain both clients in a situation where a

conflict of interest is created by him/her acting on either
parties' instructions.
• Acting for both clients increases the possibility of confidential
information leaking from one client to another. This principle
was well established in the case below:
KING WOOLEN MILLS LTD & ANOR V.
KAPLAN & STRATTON ADVOCATES CIVIL.
APP. NO. 55/93
• FACTS of the case: Mr. Keith of the firm of advocates (the
respondents ) acted for the appellants as borrowers and the
lenders between 1981-1982.
• THE ISSUE that arose was whether the advocate who acted
for both the borrower and the lender in a transaction is still
able to act or represent one of the parties or clients in any
incoming litigation in regards to the same transaction.
•
KAPLAN CONT (I)…

• THE JUDGE HELD that by acting for both lender and

borrower, real mischief and real prejudiced ensued and
therefore issued an injunction against Mr. Keith and his partner
from continuing to act for either parties in that suit or any
other suit concerning that transaction.
KAPLAN CONT (II)…

• THE GENERAL PRINCIPLE established was: Once the

solicitor has acted for a client, he should never act for the
client or opponent client in a subsequent litigation arising from
the transaction or subject matter for which he had acted for
the client.
RETAINER ON PARTICULAR
OCCASIONS
IAN GEKONGE
RETAINERS BY SPECIAL PERSONS

• Contract with minors – such contracts are considered void

unless they are contracts for necessities. A minor cannot file a
suit unless through a next of friend, responsible for costs.
• A minor can only defend a suit through a guardian ad litem
CONT (I)…

• Persons of unsound mind – they cannot contract for lack of

legal capacity.
• Poor persons– a poor person can enter into a retainer but for
purposes of certain court proceedings, he may have to file a
pauper brief in the manner provided for by the relevant
procedures or through pro bono publico services
CONT (II)…

• Companies – a company instructs an advocate in the manner provided for in the articles
of association – one has to be certain that the person instructing them has authority.
• This was seen in the case of Njougoro and Company Advocates v Dubai Bank
Kenya Limited [2008] eKLR where the Respondents through their employer in the
credit department instructed the applicant to prepare a debenture worth 50 million. The
respondent then claimed that these instructions did not constitute retainer. The learned
judge found that the employer had capacity to contract the applicant and therefore the
instructions constituted a retainer.
• Unincorporated bodies and Trustees – each of those people have to give instructions as
each person in those bodies is liable for fees.
CONT (III)…

• Liquidators and Receivers – under the Companies Act once a company is

under liquidation, the liquidator must seek the leave of court to instruct
an advocate
• Partners in a firm – the relationship of partners in respect to a retainer is
that they are liable for each other. If you contract one partner the other
will also be liable for fees. It is the same type of relationship as that
experienced between an agent and principal
TERMINATION OF RETAINERS
PRINCE MUTIE
• Termination can occur in various ways, each with specific legal
consequences
• It is the balance of rights and obligations between lawyer and
client is key.
TERMINATION BY NOTICE: BY THE CLIENT

• An Almost Absolute Right

• A client can terminate their lawyer at any time, for any reason.
• The principle is that a retainer is a relationship of trust and
confidence which cannot be forced.
• The client is still liable to pay for all work done up to the point
of termination. Any legitimate termination fees in the
agreement apply.
TERMINATION BY NOTICE: BY THE LAWYER

• A Limited Right - The Rule from Krakauer v Katz (1954)

• Mr. Katz had acted for Mr. Krakauer in a previous legal matter. Partway through that case, Mr. Katz
applied to the court to be removed from the record ,the court granted his application.
• Mr. Krakauer subsequently sued Mr. Katz for damages, alleging that the solicitor's withdrawal was a
breach of contract (the retainer) and was done negligently, causing him financial loss.
• The court of appeal determined that a lawyer does not have an equivalent right to terminate at
will. They can only do so for good cause and upon providing reasonable notice to the client. Failure
to do so may constitute professional misconduct and a breach of contract.
• The case established that a lawyer cannot terminate at will.
• They must have "Good Cause“ and provide Reasonable Notice
• An Unjustified withdrawal = Breach of Contract & Professional
Misconduct
WHAT IS "GOOD CAUSE”

• Client refuses to pay fees.

• Breakdown of trust and confidence.
• Client insists on fraudulent, unlawful, or unethical conduct.
• Harassing or unreasonable behaviour by the client.
LOSS OF CAPACITY

• Leads to Automatic Termination

• Client loses mental capacity to give instructions.
• The effect is that a Lawyer's authority is immediately revoked.
• The Lawyer must cease acting immediately
• Retainer can only resume if a properly appointed guardian(e.g.,
under a Power of Attorney) provides new instructions
COURT ORDER

• Courts have inherent power to remove a lawyer from a case

The grounds are:
i. Conflict of Interest
ii. Professional Misconduct
iii. Breach of an Undertaking
iv. Lawyer becomes a material witness
• The Purpose is to protect the integrity of the judicial process.
. LAPSE OF TIMEFRAME

• The Natural Conclusion

The retainer ends automatically when its specific purpose is fulfilled.
Examples:
• A "will-drafting" retainer ends when the will is signed.
• A "trial representation" retainer ends after judgment and appeal time
lapses.
Consequence: Lawyer's authority ceases. A new retainer is needed for
further work
DEATH OF THE CLIENT

• Immediate Termination - The Rule from Watts v Official Solicitor (1936)

• The case involved an appeal concerning the estate of a deceased person. The Official
Solicitor was acting in his official capacity, often involved in cases where there is no other
suitable person to act, unaware of the client's death, the solicitor proceeded to file the
notice of appeal on the client's behalf.
• The question arose as to whether the appeal had been validly commenced. The Plaintiff
challenged its validity, arguing that the solicitor had no authority to file it. The court
confirmed that upon the death of a client, the retainer is terminated. The original solicitor
can only continue to act if they are specifically re-instructed by these representatives
who are the executors or administrators of the estate of the deceased.
• Death automatically and immediately terminates the retainer.
• Reason is that the relationship of trust is personal to the client.
• Lawyer must stop all work.
• Authority transfers to the client's executors/administrators.
• Lawyer's right to unpaid fees becomes a claim against the estate.
• Any action taken by the lawyer after death is a legal nullity.
FRAUD OR DISHONESTY

• Termination by Breach of Trust

• By the Client:
Using the lawyer's services to perpetrate a fraud is a repudiatory
breach.
Lawyer is obliged to terminate and often must report the fraud.
• Of the Retainer Itself:
If the agreement was procured by fraud, it is voidable.
BANKRUPTCY OR INSOLVENCY

• Individual Bankruptcy:
Retainer with the individual is terminated.
The Trustee in Bankruptcy becomes the new client.
• Corporate Insolvency:
Retainer with the directors is terminated.
The Liquidator/Administrator controls the company's legal affairs
CLIENT'S INTENTIONS (FUTILITY OR IMPROPRIETY)

• The Lawyer's Ethical Firewall

A lawyer must terminate if the client's instructions conflict with professional
duty.
• Pursuing a Hopeless Case:
Lawyer can withdraw if a case is frivolous or an abuse of process.
• In the case of Njougoro & Co. Advocates VS Bank of Kenya Limited [2008]
eKLR where according to Njougoro & Co. Advocates, their retainer by
Dubai Bank Kenya Limited was to prepare a debenture for a Ksh. 50
million overdraft facility for Kensalt Packers Production Limited.
• While the firm successfully drafted the document, the bank did
not proceed with the next step of returning it for registration.
This failure ultimately led to the termination of the professional
relationship.
• Insisting on Improper Conduct:
• If a client demands the lawyer mislead the court or use illegal
evidence, the lawyer must refuse and terminate.
EFFECTS OF TERMINATION OF A
RETAINER
BRIAN KIMANI
• The first effect of termination is the end of the advocate’s authority to act for
the client in that matter. This means that when a retainer is terminated, the
advocate no longer has a mandate to commence or continue acting on the
client’s behalf. However, civil procedure rules under Order 9 Rule 5 make it
clear that a change is effective in the court’s record only once notice is filed
and served to the opposing counsel. Until then the court may treat the former
advocate as the acting counsel. This prevents abrupt gaps that prejudice the
proceedings and ensures orderly substitution of a counsel.
EFFECTS CONT’

• Another effect is entitlement to fees already earned, that is, the advocate
is entitled to be paid for work done up to the date of termination. In
Ahmednasir Abdikadir & Co. Advocates v National Bank of Kenya Limited (2)
[2006] 1 EA 5, the learned Judge held that a reading of Section 45(1) of
the Advocates Act reveals that the agreements in respect of
remuneration would be valid and binding on the parties thereto provided
that the agreements were in writing and signed by the client or his agent
duly authorized in that behalf. This means that if the parties had a fee
agreement, that agreement governs what is payable and where dispute
arises an advocate may seek taxation of costs or a court’s determination.
EFFECTS CONT’

• Another effect is that the advocate can exercise the right to retain client documents
(retaining lien) in their possession for unpaid fees. In the case of Barrat v Gough Thomas
[1950]2 All ER 1048, 1053, it was held that an advocate having a retaining lien over
documents in her or his possession is entitled to retain the documents against the client
until the full amount of his costs is paid.

• It was further held that, in so much however as the lien protects the advocate, the
general lien confers only a right to retain property. It exists for no other purpose. It is
merely passive and the advocate has no right to actively enforce his demand.
EFFECTS CONT’

• Therefore, this right is limited and subject to court supervision

and exceptions where the client would be prejudiced. Courts
balance this right against the client’s right to a fair trial and may
order release where prejudice would result or where the right
is improperly exercised. Once the Advocates’ taxable costs,
charges and expenses are paid the client is no doubt entitled to
an order for the delivery of the retained documents.
EFFECTS CONT’

• Another effect of termination is that the advocate is still bound by duties of

confidentiality and legal professional privilege as provided for under Section 134(1)
Evidence Act. This privilege belongs to the client and can only be waived by the client.
An advocate cannot disclose client information unless the client waives privilege or a
recognized exception applies, for instance, first where communication between an
advocate and the client furthers an illegal purpose and secondly, where the advocate
observes that the client used the privilege to commit a crime. This position was affirmed
by the Court of Appeal in Mohammed Salim Balala & Anor vs Tor Allan Safaris Ltd
[2015] eKLR and recently reiterated by the same court in Director of Public Prosecutions
v Tom Ojienda t/a Prof Tom Ojienda & Associates Advocates & 3 others (supra).
CONT’

• Additionally, if the retainer is terminated in breach of express contractual terms, for

instance, a fixed-term retainer that can’t be prematurely revoked except in specified
circumstances, the aggrieved party may claim damages or unpaid fees as a contractual
remedy. If one party repudiates the contract without lawful cause, the innocent party may
sue for breach. If termination is driven by alleged misconduct, that is, conflict of interest,
negligence or dishonesty by the advocate, the matter may be referred to the Law Society
or the Advocates Complaints Commission and may attract disciplinary sanctions. This
means that termination motivated by professional breaches can lead to disciplinary
proceedings under the Advocates Act and LSK rules. Courts may also grant appropriate
relief (including costs) depending on the seriousness of the misconduct.
WANT OF
AUTHORITY
JOAN NDUATI
CONT(I)…

• It arises when a person or agent purports to act on behalf of another without

the necessary legal or contractual authority.
• The doctrine of authority is central in the law of agency and contract, as it
determines the extent to which a principal is bound by the acts of an agent.
Where a person purports to act without authority, or in excess of authority, the
law attaches significant consequences, both for the purported principal, the third
party, and the unauthorized actor.
• Firstly, any act done without authority is generally not binding on the principal.
The principal cannot be compelled to perform obligations under such a contract
unless they subsequently ratify the act.
CONT(II)…

• This is consistent with the provisions of the Contracts Act (Cap 23, Laws of
Kenya), particularly sections 145–150, which recognize that agency may only arise
where authority is express, implied, or subsequently ratified.
• Secondly, unauthorized actor may be personally liable. A person who represents
themselves as having authority when in fact they lack it, is liable for breach of
warranty of authority.
• This principle was articulated in the English case of Collen v Wright (1857) 8 E&B
647, which has been adopted in Kenyan jurisprudence, where the court held that
an unauthorized “agent” is personally responsible to the third party who relied
upon their misrepresentation of authority.
CONT(III)…

• Thirdly, the third party is entitled to relief. A third party who enters into a
contract with an unauthorized person may elect to treat the contract as
void and unenforceable against the principal.
• Nonetheless, such a party may seek damages against the unauthorized
actor. Importantly, if the principal ratifies the act—as permitted under
sections 149–150 of the Contracts Act—the transaction becomes binding
as though authority had existed from the outset.
CONT(IV)…

• Fourthly, in the context of company law, acts undertaken by officers

without authority may be invalid or ultra vires the company.
• However, the law balances this by protecting outsiders through the indoor
management rule established in Royal British Bank v Turquand (1856) 6
E&B 327, which entitles persons dealing with a company to assume that
internal company procedures have been duly complied with, unless they
had notice of the irregularity.
• Kenyan courts have similarly applied this principle to safeguard commercial
transactions from unnecessary invalidation due to internal lapses.
CONT(V)…

• Lastly, equitable principles also apply. Courts may grant restitutionary

remedies to prevent unjust enrichment where one party has conferred a
benefit under a transaction void for want of authority.
• Ratification, however, must be complete and not partial, and cannot be
exercised to the detriment of third parties who have already withdrawn from
the arrangement.
In conclusion, this body of principles underscores the importance of
authority in agency and corporate dealings, ensuring fairness while balancing
the interests of principals, agents, and third parties.
THE END
THANK YOU