Ethics FAQs

Yes, if there is a statutory power that overrides confidentiality and, where applicable, privilege (see rule 4.01 of the Code and guidance note 7 which deals with insolvency). 

If you are in any doubt, ask the person or authority seeking disclosure to indicate the statutory provision they are relying on and consider the relevant provisions.  Where a statutory power overrides confidentiality, you should ensure that any disclosure you make is strictly limited to what is required by the law.

Yes.

You may disclose the file that belongs to the lender client.

You cannot—without the consent of the borrower—disclose the part of the file that belongs to the borrower. Please see rule 4.01.

No, not unless the other client consents to the original being released. However, you can provide a copy of the file on payment of your reasonable copying charges. See Question of Ethics, November 2009.

Yes, if you are satisfied that

• HMRC is statutorily entitled to have access to that information;
• if the information is privileged, the statute overrides privilege; and
• all relevant conditions under the relevant legislation have been met.

A number of statutes empower government and other bodies to require any person to disclose documents and/or information. In the absence of the client's specific consent, you should ask under which statutory power the information is sought, consider the relevant provisions and consider whether privileged information is protected from disclosure. You should only provide such information as you are strictly required by law to disclose (rule 4 and guidance note 9).

Yes, provided

• each client is represented by two separate office in different localities and neither client has been referred to their office by another office of the firm; and
• there is no conflict of interest and one does not arise; and
• you have the clients’ informed written consent (see rule 3, guidance note 77 of the Code); and
• the seller is not selling as builder or developer; and
• different fee earners and supervisors in each office deal with the matter.

See rules 3.07, 3.09 and 3.10.

Yes, provided you limit the retainer.

While there would be a conflict in acting for both husband and wife in the matrimonial proceedings, there is a substantial common interest in selling the house. Rule 3.02(1)(a) of the Code allows you to act provided you have both parties’ informed consent and can comply with all parts of that rule.

The retainer should be limited to the conveyancing only and not advising on the merits of the sale.  It is important that the husband understands this. Both parties will need to agree as to how the sale proceeds are to be divided.  However, even with such agreement, bear in mind that if one of the parties subsequently changes instructions, you will not be able to make any payment out of the net proceeds without their joint instructions.

You will have a conflict of interests if either:

• You have more than one current client and you owe different duties to act in the best interests of those clients in the same or related matters (rule 3.01(2)(a)). For example if you would advise each client differently.

  You will not have a conflict between a current client and a former client if you are no longer acting for the former client, although there may be issues in respect of confidentiality (rule 4.03). If you are in possession of confidential information about a former client which is material to a current client a conflict could arise between your duties of confidentiality and disclosure. See rules 4.01, 4.02 and 4.03;

  Or

• If your interests conflict with those of the client (rule 3.01(2)(b)). For example you must not in your personal capacity loan money to a client without requiring the client to obtain independent financial advice.

Yes.

There is nothing in the Code of Conduct to prevent family members from instructing your employer firm.

However, you need to bear in mind whether you can act personally without a conflict arising between you and your client (family member). Please see rule 3.01.

The Solicitors' Indemnity Insurance Rules allow a solicitor with a practising certificate to act for friends or family members without needing professional indemnity insurance—provided they do not receive any fee, gain or remuneration.

If you don't have a practising certificate, you cannot do the work as a solicitor and you cannot refer to yourself as a solicitor.

No.

This is an individual mortgage at arm's length (rule 3.17(1) and rule 3.16(2)).

You can only act on an individual mortgage if it is not at arm's length (rule 3.16 and guidance note 72) and there is no conflict of interests.

Have you held or received client money—for example, in the form of unpaid professional disbursements?

If Yes: Notwithstanding that rule 21 allows a solicitor to hold client money from the Legal Services Commission in an office account, the solicitor must submit an accountant's report (rule 35(1)).

If No: There is no requirement to submit an accountant's report to the SRA unless the SRA specifically requires delivery of a report in accordance with powers under rule 32(2).

Yes.

Please see Solicitors' Accounts Rules - assistance for accountants.

The Code of Conduct does not set down the procedure for recovery of costs. This is a legal issue, and the firm must take legal proceedings.

It is your decision whether you need to consider if you need a client account.

If you do not intend to hold client money, you can take the decision not to operate a client account.

Please see Setting up in practice for more information.

Yes.

Rule 32(1)(c) of the accounts rules requires a solicitor to keep accounting records properly written up at all times to show the solicitor's dealings with any office money relating to any client or trust matter. All dealings with office money relating to any client matter must be appropriately recorded in an office cash account and on the office side of the appropriate client ledger account (see rule 32(4)).

No.

There is no requirement to get the best rate of interest unless you have agreed to do so.

For monies held in a separate designated account, you must aim to get a reasonable rate (rule 25(1)).

For monies held in a general client account, the interest belongs to the firm, but you must account for a fair sum in lieu of interest. See rule 25(2) for how the sum should be calculated. 

Is the amount held for each client or trust matter £50 or less?

If Yes: Provided you can comply with the requirements in rule 22(2A) of the accounts rules, you can pay the money to a charity.

If No (or if you cannot comply with all of the requirements in rule 22(2A)): You will need to make an application to the SRA for authority to withdraw the funds (see application form and guidance).

Yes. Provided you follow the procedure in rule 22(2A) of the Solicitors' Accounts Rules, you may send individual balances under £50 to charity.

If there are any funds over £50, you need to make an application to our Professional Ethics Team.

Please also see Question of ethics, April 2010.

Guidance note 53 to rule 2.05 of the Code of Conduct provides that if you are or your firm is, in effect, the client—for example, as the executors administering a deceased's estate or as the trustees of a trust—you should consider whether information on complaining about a bill should be given to any person likely to be affected by the bill.

Are you holding the funds for a specific purpose (e.g. deposit for house purchase)?

 If Yes: The funds are not available to be earmarked for costs, and you cannot transfer without the consent of your client.

 If No: The funds can be earmarked for costs. You do not need the consent of your client, but you must comply with rules 19(2) and 19(3) of the accounts rules.

No—unless you are utilising one of the exceptions in rule 13.

This involves a complex formula. Please contact our Client Protection Unit for assistance: email professionalindemnity@sra.org.uk or call 01527 504487.

The Law Society operates a professional indemnity insurance helpline for firms in the lead-up to the practising certificate and recognition renewal application deadline on 1 October. Please visit www.lawsociety.org.uk/professionalindemnity.

Alternatively, you may wish to contact the SRA's Client Protection Unit, which can provide advice on obtaining cover. Our Client Protection Unit also deals with the assigned risks pool: email professionalindemnity@sra.org.uk or call 01527 504487.

Rule 4(c) of the Solicitors' Financial Services (Scope) Rules 2001 requires that all commission received by virtue of financial services must be paid to the client unless the client agrees to allow the solicitor to retain it.

For more help, please see Question of ethics, June 2010.

This is a rule of the Ministry of Justice, and you should contact them directly.

As you rightly say, Outcome 8.5 of the SRA Code of Conduct, which came into effect on 6 October 2011, requires firms to put "Authorised and regulated by the Solicitors Regulation Authority" on their letterhead, website and emails.

This is an important change in signalling to clients and consumers generally that all firms are not simply regulated by the SRA, but have been subject to an authorisation process to enable them to enter the regulated community and provide legal services to the public. Under risk-based, outcomes-focused regulation, the authorisation process will play a more important role in the regulatory system and the SRA will be applying a greater proportion of its resources to this activity.

The above requirement in Outcome 8.5 applies from 6 October, and firms should have made the necessary changes by this date. Websites must therefore have been amended by this date, along with letterheads printed individually by computer system macros and email footers. However, we recognise that some firms may have existing stocks of pre-printed notepaper and wish to make the change at the point at which new stocks are ordered. We are happy for firms to take this approach provided that the change is made as soon as practicable in the next few months.

It is not possible for a solicitor in the course of providing legal services to rebut the presumption they are practising with the words "non-practising".

Please see guidance note 16 to rule 20.01 of the Code of Conduct.

Please also see the following guidance:

• Do I need a practising certificate working in private practice?
• Do I need a practising certificate working in a non-solicitor organisation?

Guidance note 47 to rule 7 of the Code of Conduct provides that it is not a question of conduct to write to clients once a solicitor has left a firm—provided he or she is not prevented from doing so in law.

Yes. Please see guidance note 29 to rule 7.

Rule 7.03 of the Code of Conduct prohibits a solicitor from making unsolicited approaches to members of the public.

Therefore, as a solicitor, you could have a stall in a shopping mall, but you would not be able to approach members of the public: You must wait for them to approach you and request information.

Yes—provided you still satisfy the requirement of rule 7.07 and any applicable legal requirements.

You must inform us of your trading name.

Please see Question of ethics, July 2009.

For help, please see the following:

• Do I need a practising certificate working in private practice?
• Do I need a practising certificate during a temporary break or retirement?
• Do I need a practising certificate working in a non-solicitor organisation?

Please also see Question of ethics, January 2010.

For a list of reserved activities, please see rule 20.01 of the Code of Conduct.

Yes.

Regulation 14 of the Practising Regulations 2009 provides that you must inform the SRA within 14 days.

On the effects of bankruptcy, please also see Question of ethics, July 2009.

The Code of Conduct contains a definition of employee in rule 24 which can include consultants.

If you can satisfy this definition, you are considered an employee for the purposes of the Code of Conduct.

Please note that it is not a legal definition for employee rights.

Yes.

All solicitors must keep us informed of their current practising address.

Please see How to update your practising details.

Yes.

This person is a new manager—a partner in a partnership, a member in a LLP, or a director in a company.

You must notify us using form NM1.

Yes—as long as you have a current practising certificate and you can practise in accordance with rule 15.12 of the Code of Conduct.

If you are intending to go to a European country, you should check with the country you are intending to work in to see if they require you to be registered with them.

When a solicitor is in house, they are only permitted to act for their employer.

They are not permitted to work for the clients of the organisation unless they can fall within one of the exceptions in rule 13.

Yes.

Rule 14.04-14.06 of the Code of Conduct defines who may be partners, members or directors of a law firm.

Yes.

A solicitors' practice can be in a company structure in accordance with rule 14.06 of the Code of Conduct.

There is no timescale to becoming a partner, provided there is at least one partner in the practice who can satisfy rule 5.02 of the Code of Conduct.

Please see Setting up in practice.

The retainer is a contract, and is subject to legal obligations.

Therefore, it would be advisable to inform clients of the change.

The firm also needs to consider the legal position of such changes.

Guidance note 8 to rule 2 of the Code of Conduct allows a solicitor to terminate the retainer if they have a very good reason, and upon giving reasonable notice.

If the matter is contentious, section 65 of the Solicitors Act 1974 allows a solicitor to terminate for non-payment of fees.

If the matter is non-contentious, the solicitor would have had to reserve the right to terminate within their terms of business.

The Code of Conduct does not provide timescales for the storage of files.

This is a matter that needs to be considered and assessed by the principals of the firm in accordance with rule 5 of the Code of Conduct.

The Law Society has issued a practice note on file retention.

No.

If a solicitor is practising as a solicitor in more than one position, the two positions are not considered separate businesses.

A solicitor has a separate business if he or she has another business that itself is not a solicitor's practice.

Please see rule 21.02 of the Code of Conduct for a list of prohibited separate businesses.

No.

Please see rule 21.02 of the Code of Conduct and Question of ethics, March 2010.

The role of the Ethics Guidance team is to provide confidential guidance and assistance to those we regulate on matters of professional conduct, based on information presented to us.

We do not deal with the investigation of complaints–nor can we receive reports of serious misconduct.

While we are happy to offer guidance, we cannot approve products or schemes—or provide precedents.

We cannot provide legal advice that also includes questions on legal professional privilege.

If you have questions about money laundering or identification of clients, please contact the Law Society's Practice Advice Service.

Yes.

A solicitor can only act for both parties to a conveyancing transaction if

• the parties are connected or related in law, or
• they are both established clients, or
• the transaction is for less than £10,000, or
• each client by chance went to a different office of the same law firm.

Yes.

In conveyancing transactions, because the solicitor needs to pay stamp duty and land registry fees on the day of completion or shortly thereafter, they tend to issue one bill/completion statement to clients asking for monies just before completion.

This bill normally includes their costs, and this is acceptable practice.

Yes.

A solicitor owes a duty of confidentiality to their client. Therefore, until your mother dies (and at that time the duty to keep matters confidential will pass to the executors), the solicitor cannot hand over the will. The solicitor could give you a copy of the will if your mother gives her written consent and has full mental capacity to give that consent. The solicitor may have to visit her to assess capacity before handing over the will.