Chapter 1 Flashcards
(16 cards)
Overarching objective?
Rule 1.1
Keep client money safe
Define client?
Rules 12.8(a)- (c)
Glossary defines as person for whom you act
What is a principal?
Sole practitioner or a partner in that firm
How is principal money treated?
Rule 12.8
Money held or received on behalf of the principal is office money
What are the exceptions to the way principal money is treated?
Rule 12.8(b)
If the principal is dealing jointly with their spouse, the money is treated as client money
Rule 12.8(c)
When the principal is buying with the aid of a mortgage, and the firm is also instructed on behalf of the mortgage lender, mortgage money belongs to lender client
Define client money
Money held or received for a client of the firm- belongs to the client for the time being
How is money received from the client on account of costs treated? What is the rule?
Client money
Rule 12.2(e)
How is money received in respect of unpaid disbursements treated? What are the rules?
Client money
Rules 12.2(d) and 12 guidance note (i)
What is the general rule in relation to disbursements? What are the rules?
Solicitor not yet paid the disbursement, any sums received from the client in anticipation of those disbursements are client money
Rules 12.2(d) and 12 guidance note (i)
How is money treated when the client has already paid a disbursement? What is the rule?
Office money
Rule 12.7(c)(ii)
How is money treated if the solicitor has incurred a disbursement but not yet paid it?
Office money
Rule 12.7(c)(iii)
What is the exception to rule 12.7(c)(iii)?
‘Unpaid professional disbursements’
Money received to pay professional disbursements is only office money if the solicitor has actually paid the disbursement, not when it is incurred (i.e. the invoice arrives)
Define professional disbursements
Fees of counsel or other lawyer or of a professional or other agent or expert surveyors and estate agents but not travel agents’ charges
Define profit costs
Fees the solicitor charges to the client for carrying out work on behalf of the client
Which rule states that office and client money must be kept separate?
Rule 1.2(a)
Examples of professional disbursements?
Fees of counsel or other lawyer
Professional/ expert/ agent instructed by you
Interpreters, translators, process servers, surveyors and estate agents
