Question of ethics

Important: The guidance below was written and issued following the introduction of the SRA Handbook on 6 October 2011. For earlier issues of Question of ethics, which may refer to regulatory material that is no longer in effect but may still be relevant, please see the Archive.

July 2017

In this issue:

  • I have been instructed to act for a client in an employment dispute. The client's household insurance policy provides legal expenses cover for his legal fees. I have checked and the insurance company have agreed that I can act under their terms of the policy. Do I need to send a client care letter to my client or do I send it to the insurance company in view that they will be paying my client’s legal fees?

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June 2017

In this issue:

  • I am a solicitor in my firm’s family law department. I am also a mediator and a member of a well-known mediation organisation and provide mediation services through the firm. 
  • I am on the roll of solicitors of England and Wales, but do not hold a current practising certificate. I now live in Australia, where I am practising solely as an Australian solicitor.

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May 2017

In this issue:

  • We are in the process of converting our firm from a partnership to an LLP and have just submitted an application for authorisation of the new LLP. Apart from the authorisation aspect, what other issues do we need to address?

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March 2017

In this issue:

  • I have been asked to act for a buyer and seller in a conveyancing transaction. Am I able to do this under Outcome (3.6) of the SRA Code of Conduct on the basis that the parties have a substantial common interest in relation to the transaction?

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February 2017

In this issue:

  • I work for a residential conveyancing firm. Occasionally we end up with a tiny sum of client money left at the end of a transaction. Is there a de minimis figure where the money can be transferred to charity without having to contact the client? If not, can we include such a provision (eg £10) in our terms of business?
  • I act for a husband and wife in relation to a sale of a property that they own as joint tenants. Following completion, I wrote to them for instructions as to where to send the net proceeds of sale. I have now heard back from each of the clients; both tell me they are getting a divorce, but I have received different instructions from each of them as to how to distribute the sale proceeds.
  • I am acting on the sale of a company. My client has now instructed me to deal with a second potential buyer. Since the company owns freehold land, does this mean that I am required to inform both potential buyers of the existence of the other?

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December 2016

In this issue:

  • I made a request to a local hospital for client/patient records on an urgent basis in respect of ongoing matrimonial proceedings involving children. The hospital has told me that it cannot deal with my request urgently and has pointed out that the patient consent to release was signed over a month ago. Where do I stand?

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November 2016

In this issue:

  • I act for a client in Judicial Review proceedings. My initial application to the Administrative Court was refused, but a subsequent application to the Court of Appeal was successful. The solicitors for the other party are now alleging that my client misled both the Administrative Court and Court of Appeal. As I prepared the pleadings for the Judicial Review, I am concerned about my position. Can I cease acting for the client and tell the Court why?

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October 2016

In this issue:

  • I am the COLP for my firm. We have decided to close down one of our branch offices. Are there any particular steps we need to take in order to comply with the Handbook?

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September 2016

In this issue:

  • We are considering using social media to attract new clients.  What sort of things should we bear in mind from a conduct point of view?

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August 2016

In this issue:

  • My bank has recently notified me that should the base rate fall further, they will start charging me "negative interest" on my general client account by levying a charge based on the amount held and the number of transactions. If this were to happen, would I still be required to account to clients for interest? How do I deal with the negative interest and is this an expense I can recoup from clients?

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July 2016

In this issue:

  • A solicitor in my firm has been acting for some time for Mr A in connection with his divorce. A few weeks ago, she was instructed by Mr X in connection with his divorce. Mr A recently told her that his wife had started a relationship with someone, but he has now disclosed that his wife has moved in with Mr X. Do we have a conflict of interests in continuing to act for both clients?
  • I am about to finish my training contract and will shortly be admitted to the roll. I will be staying on with the firm, but they are reluctant to pay for a practising certificate until the new practising year begins. The HR department says that so long as I am only held out as a paralegal and not as a solicitor, I will be able to do legal work and do not need a practising certificate. Is this right?

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June 2016

In this issue:

  • I am acting in litigation for a defendant, the Claimant's solicitors have not been responding to correspondence. My client has instructed me to make an offer to settle the case and I suspect that the firm is not passing the information onto their client. Is it acceptable for me to write directly to their client with details of the offer?

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April 2016

In this issue:

  • I have been acting in connection with the grant of a new lease of premises to my client. As requested by the firm acting for the landlord, we provided an undertaking to pay their client's legal costs. However, after protracted negotiations, the matter fell through and the lease was not completed. The landlord's solicitors have now submitted a bill, insisting that we are liable to pay it. Our client does not believe he is at fault and has instructed us not to do so. What is our position?
  • I acted for a client on the assignment of a lease in respect of which the landlord's solicitors sought an undertaking for their fees in connection with the licence to assign, whether or not the matter completed. We provided the undertaking, but imposed a cap on the amount of costs payable. The matter fell through after only a few days and before any draft licence was sent to us. However, the solicitors have submitted a bill for the full amount payable under the undertaking. Do we have to pay this?

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February 2016

In this issue:

  • I have a client who wants to use crowd funding to pay for his claim against a local authority. The client isn't eligible for legal aid. Apparently the client has approached a crowd funding website, which has accepted his request. The crowd funder’s website allows people to pledge funds towards particular claims. I understand that no payments are taken until a minimum figure has been pledged. It is proposed that, at that point, the funds will be collected from the donors and paid into my client account. I will have an obligation to ensure that the funds are used towards my fees and for disbursements in the case. The client will be obliged to keep the funder up to date with progress. At the end of the matter if there are any excess funds, or I recover costs from the local authority, these are to be paid to the crowd funder, who will either refund them to the donors or donate them to charity.

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December 2015

In this issue:

  • I am a criminal defence solicitor with a legal aid contract. I often use outside agents to represent my clients at police stations. These agents are either solicitors or accredited police station representatives. Will these agents be covered by my firm's indemnity insurers in respect of their attendances at the police stations with my clients? Is the position different depending on whether the representatives are solicitors or not?
  • I have been reading about the changes to the SRA Accounts Rules (SAR) which came into effect on 1 November 2015 and in particular, the exemption from obtaining an accountant’s report in the new rule 32.1A(b). Our accounting year ended on the 30 September. Are we able to take advantage of this rule change?

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November 2015

In this issue:

  • I am a solicitor wanting to work for a firm of solicitors on a self-employed basis. I think I still count as an employee for the purpose of the Handbook and so will be covered by the firm's PII policy. However, the firm's insurer has said that I would not be covered under its policy definition of 'employee'. Is that right?
  • I am currently practising as an in-house solicitor. Do I need indemnity insurance?
  • I am a sole principal who does low risk criminal work and I have a claims free record. I am proposing to retire in a few months, but I have the following questions with regard to run-off:

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October 2015

In this issue:

  • I have recently been appointed the COLP for my firm. The firm has always charged clients for undertaking electronic identification checks for money laundering purposes, which we charge as a disbursement. However, I noticed an indicative behaviour in the SRA Code of Conduct 2011 states that this is likely to be misleading. Are we permitted to make such a charge, and how should it be presented on the bill?

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August 2015

In this issue:

  • I am a solicitor mediator. I regularly get requests from the parties in mediation, who do not wish to take legal advice or instruct separate solicitors to draft a court order reflecting the agreement they have reached as a consequence of mediation. Can I do this by way of a new restricted/limited retainer once the mediation retainer is complete?

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July 2015

In this issue:

  • I have heard that there is some recent EU legislation which will affect solicitors. What are the changes and will they result in changes to the Handbook?
  • I have recently been appointed the Compliance Officer for Legal Practice (COLP) for my firm. The firm has always charged clients for undertaking electronic identification checks for money laundering purposes, which we charge as a disbursement. However, I noticed an indicative behaviour in the SRA Code of Conduct 2011 states that this is likely to be misleading. Are we permitted to make such a charge and how should it be presented on the bill?

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June 2015

In this issue:

  • I am the COFA for my firm. I have recently heard of a local firm who have been the target of a fraud. The firm in question were acting on the sale of a property for a genuine client. The client had given them details of his bank account to enable the firm to transfer the net proceeds of sale following completion. Before the firm could do so, they received an email, purportedly from the client, asking for the monies to be sent instead to a different account in his name. It subsequently transpired that a fraudster had hacked into the client’s email account and diverted the monies to an account which has since been cleared out. What steps should I be thinking about to ensure this does not happen to us?

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May 2015

In this issue:

  • I am a Spanish abogado registered with the SRA as a REL. I am currently practising in a firm of solicitors, but have been approached by a Spanish law firm with a view to setting up a branch office of their firm here in London, practising mainly Spanish law, but possibly also providing advice on English law. Am I right in thinking the firm will need to be authorised?

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April 2015

In this issue:

  • I am the COLP in a small firm. I recently read of the SRA's problem with regard to the storage of files obtained through interventions and I raised the issue with the managers in my firm, since we still have paper files and we store a large number of old files. I think we should be considering what to do now, but the managers are reluctant to do anything about it until they have to. Should I be pushing this?  

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March 2015

In this issue:

  • I act for a client in divorce proceedings. After a recent court hearing, the solicitor on the other side asked me if we could have an "off the record" conversation. I did not have any instructions from my client to engage in such a conversation and therefore refused. Was I right to do so?

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January 2015

In this issue:

  • Our COFA is leaving the firm in a few weeks and the partners have asked if I will agree to be appointed in his place. I have only a superficial knowledge of the SRA Accounts Rules 2011 (SAR), but I understand that this is not an issue since no particular qualification is required to fulfil the role. Is there anything else which I should consider? 
  • I am currently in a partnership with another solicitor who will be retiring shortly due to ill-health. The firm is only small, but we have two offices. My partner is currently the COFA for the firm, while I am the COLP. I need to submit an application to become a recognised sole practitioner, which will of course include appointing someone to take on the role of COFA. Could I do this myself, or would it be better to appoint someone else in the firm? 

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December 2014

In this issue:

  • I am a partner in the immigration department of a law firm. We are considering employing paralegals to work alongside our Solicitors. Am I obliged to supervise the paralegals in my department? 

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November 2014

In this issue:

  • I am the COFA for my firm. We opened a general client account with a building society earlier this year, but we have now discovered that the building society is crediting the interest earned on the client account to that account, rather than to our office account. I raised this with the building society, but they say that due to their computer software the interest earned on the account must be credited to that account and the software cannot be altered.

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August 2014

In this issue:

  • My firm is holding £6,000 in the general client account which is made up of various individual balances due to different clients. We have attempted to return the money to them at the end of the retainer but are unable to locate them. Should I seek authorisation from the SRA to withdraw this money in order to pay it to a charity in accordance with rule 20.1(k) of the SRA Accounts Rules 2011?

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July 2014

In this issue:

  • My firm will be undertaking insurance mediation activities and wishes to be included on the Exempt Professional Firm Register (EPF) with the Financial Conduct Authority (FCA). The managers need to appoint an insurance mediation officer whose name will appear on the register and they want me to undertake the role. Am I a suitable person to fulfil this role given that I am newly qualified as a solicitor? 

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May 2014

In this issue:

  • My firm was instructed by a lady to draft her will. The will was drafted but never executed. The draft will remained in the client's file and we heard nothing further from the client. We have just been contacted by the client's daughter who has provided us with a grant of probate showing that she was appointed as her mother's Executor in a will which was executed some time after the client instructed this firm. The daughter has asked us for the file containing the draft will which was never executed. Do we have to release the file to the daughter even if we believe that the client would not have wanted the daughter to know what was in the draft will?
  • I have been acting for a client in a very high cost criminal matter (VHCC), and the chambers I generally instruct on such matters has refused to take this matter on as a consequence of fee cuts. This would leave my client with no trial advocate.
  • If, in the scenario described above, I cannot find an available barrister from my usual chambers, should I consider instructing an advocate employed by the Public Defenders Service (PDS)?
  • My client is charged with an 'either way' offence. Having regard to the recent legal aid changes, can I limit my retainer to representing the client at the police station and magistrates court only?

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April 2014

In this issue:

  • In the February 2014 print edition of Compliance News Round-up, the first case study dealt with the bankruptcy of a sole practitioner. It referred to the fact that the solicitor's practising certificate would be automatically suspended and the solicitor would therefore need to employ another solicitor to operate the client account. Is this correct?

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March 2014

In this issue:

  • We have a shortfall of £100,000 on our firm's client account but this is through no fault of our own. It is entirely due to a bank error in the money being transferred by telegraphic transfer to the wrong person, despite our giving the bank the correct details. I am aware that Rule 7 of the SRA Accounts Rules 2011 requires missing client money to be replaced from the firm managers' own resources. Does this apply to us as the shortfall on client account was caused by the bank and not by anyone in our firm? 

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January 2014

In this issue:

  • I would like to offer a fixed fee arrangement to my clients so that they can be clear about their costs position. The monies will be paid upfront and they will be billed for the agreed sum at the end of the retainer. I understand this is an agreed fee under Rule 17.5 of the SRA Accounts Rules 2011 and that the monies must go in to the office account. Is this correct?

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November 2013

In this issue:

  • I am one of the members in a recognised body which is an LLP (a law firm). The COFA in the firm, a solicitor, who was our Head of Finance, has resigned from her post and has confessed that she has been taking money from the firm's office account and has made arrangements to repay the money to the firm on an instalment basis. She has stolen money from the firm in the region of £100,000.

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September 2013

In this issue:

  • What is the position with regard to the Consumer Credit  Act group licence? What will be the position for firms under the new regime once this has transferred to the Financial Conduct Authority (FCA)?

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July 2013

In this issue:

  • We have recently taken over another firm. As the COFA, I am concerned about the number of old outstanding balances we have acquired in respect of which we do not have copies of the relevant ledgers or the relevant files. What should I do?

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June 2013

In this issue:

  • I have read Chapter 3 of the SRA Code of Conduct 2011 in respect of conflicts of interest and in particular, Indicative Behaviour 3.14. Does this mean that it is no longer possible for a firm to act for both a buyer and seller in a conveyancing transaction?

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March 2013

In this issue:

  • I'm a solicitor carrying out insurance mediation activities. Is there anything I will need to do when the Financial Services Authority splits into the Financial Conduct Authority and the Prudential Services Regulator?

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January 2013

In this issue:

  • I have read the Law Society Practice Note with regard to outsourcing. Can I assume that provided I follow this guidance, I will be in compliance with the SRA Handbook?

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December 2012

In this issue:

  • We have been contacted by the police, who want us to provide them with details of our client' address and telephone number because they suspect he has committed an offence. Should I provide this information to the police?

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November 2012

In this issue:

  • I am a solicitor in the Government Legal Service. As such, I am told that I do not need a practising certificate. However, I am being seconded to a private practice firm for a short period; does this alter the position?

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October 2012

In this issue:

  • I am currently an unemployed solicitor and have so far been unsuccessful in finding a job as a solicitor. Is there any problem with me accepting a job in my private practice as a paralegal?

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June 2012

In this issue:

  • Is it advisable to appoint a deputy COLP or COFA in case one of the compliance officers leaves or is absent?

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May 2012

In this issue:

  • Is there any advice you can offer us on the sort of people we should be nominating as COLP and COFA? Must it be the senior or managing partner?

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February 2012

In this issue:

  • Does the reference to an "individual" in rule 8 of the SRA Authorisation Rules 2011 include a body corporate? Our partnership is primarily made up of limited company partners.

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December 2011

In this issue:

  • I am the head of a legal department in a local authority. Do I need to include on my department's notepaper the fact that we are authorised by the SRA? 

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