The Retainer

Question 1

Whats the primarily purpose behind a solicitor identifying who they are acting for in relation to matter?

Answer 1

To prevent solicitors inadvertently becoming involved in fraud

Question 2

What was the case study outcome of fraudulent sellers?

Answer 2

Although the buyers solicitors were not negligent, they were liable for the looses because they received money on trust for genuine completion.

The Code was changed and now expressly provides that the seller’s solicitor holds the purchase moneys on trust for the buyer and is under a fiduciary duty not to deal with that money other than in accordance with the terms of the Code

Question 3

How do solicitors mitigate fraud risks?

Answer 3

To mitigate fraud risks, solicitors must verify the identity of parties involved and adopt proportionate measures suggested by the SRA. Additionally, solicitors are obligated under the Money Laundering Regulations 2017 to obtain satisfactory evidence of their clients’ identity

Question 4

Can Third party give instructions to the solicitor on behalf of the client? e.g clients daughter

Answer 4

solicitor only acts based on instructions directly from the client or from someone authorised to provide instructions on behalf of the client.

Question 5

What if solicitor conducts proceeding without that authority?

Answer 5

Solicitor will be personally liable for the cost incurred

Question 6

Is a solicitor free to decide whether to accept or decline instructions to act for a particular client?

Answer 6

Yes, but cannot unfairly discriminate by allowing their views to affect their professional relationship and the provides they services

Question 7

What should a solicitor do if they have reason to suspect that the instructions received from client or someone authorised on their behalf do not represent clients wishes? e.g. Duress or undue influence and vulnerable clients

Answer 7

Solicitor must not act unless they have satisfied themselves that they do

Question 8

Example: solicitor has to act for a client who lacks mental capacity. What should they do?

Answer 8

solicitor is subject to the overriding obligation to protect the client’s best interest.

Question 9

What would be advisable if there is no evidence of undue influence but Client insists on acting in a way which appears to be to the disadvantage?

Answer 9

To explain the consequences at the instructions and ask client whether they wish to proceed and for this advice and consent to be documented

Question 10

Gifts from client?

Answer 10

Solicitor should be careful when any gift is more than £5OO
Needs to consider:
- is it worth more than 1% of clients current estimated net estate
- it might become valuable at some point, especially after death of client
-It provides benefit to un individual which is more valuable than his relationship to the deceased reasonably justifies

Question 11

Can client sue solicitor for duty of reasonable care and skill implied in the term into the retainer?

Answer 11

Yes, solicitor may be sued for breach of contract if the term is breached.
However, implied term does not apply to advocacy services provided before a court room.
Nevertheless, a solicitor who acts as an advocate may be sued in the tort of negligence if the solicitor breaches their duty of care to the client within court proceedings

Question 12

whats the relationship between solicitor and client?

Answer 12

fiduciary relationship -> (common law) one party must act in the best interests of the the other party

Question 13

Duty to act in best interest?

Answer 13

solicitors have broader obligations to safeguard money and assets entrusted to them by clients and are not allowed to hold client money unless operating within an authorized body

Question 14

Does the solicitor need express or implied authority to deprive from the retainer to bind the client?

Answer 14

Express instructions/authority

Question 15

Can a client terminate the retainer?

Answer 15

Can at any time for any reason but client likely to be liable to pay solicitors fees for work done up until the point of termination -> solicitor may require their costs to be paid prior to forwarding the file to the client

Question 16

Can a solicitor terminate the retainer?

Answer 16

Solicitor will a good reason. Needs to provide with reasonable notice of termination (unlikely to be acceptable to stop acting right before court hearing)

Question 17

Can the law terminate the retainer?

Answer 17

Yes, in certain circumstances,

e.g solicitor declares bankrupt or either party loses mental capacity after the retainer has commenced

Question 18

What are the responsibilities on termination

Answer 18

(Good practice) solicitor should confirm to client in writing that retainer has been terminate, explain, where appropriate the clients options for pursing the matter and take steps to deal with any property of the client which may be held by the solicitor

Question 19

What is advisable for a solicitor to do when terminating a retainer?

Answer 19

To retain a copy of the file - to defend them from any future claims of negligence

Question 20

What is a lien and how can solicitors use it?

Answer 20

lien grants a creditor the legal right to retain a debtor’s property until payment is made.

Solicitors can use a lien to withhold property, like client papers, until their fees are settled, but they can also accept an undertaking to pay costs instead.

Answer 21

the court can compel a solicitor to return papers to the client, with similar authority held by the SRA

Solicitors can get a charging order, which lets them ensure they get paid for their work by using any personal property that’s been recovered or kept during legal proceedings.