The Gazette 1985

GAZETTE

JANUARY/FEBRUARY 1985

Practice Notes

Solicitors' Accounts Regulations (No. 2)

S.I. No. 304 of 1984

Price: £1.25, (postage 35p) from Government Stationery

Office or from the Law Society.

Members are advised that new Solicitors' Accounts

Regulations are now in operation with effect from 1st

January 1985. The main purpose of the new regulations is

to abolish the old Certificate A and to elaborate on the

contents of the old Certificate B by the inclusion of details

of clients' funds held.

At the same time the opportunity has been taken to set

out the duties of the reporting accountants employed by

each Solicitor in line with the best modern practice. The

Institute of Chartered Accountants has been most helpful

through their Technical Committee in contributing to the

preparation of these regulations.

It is the Society's view that the most important

protection of the Compensation Fund is proper applica-

tion and enforcement of the Solicitors' Accounts

Regulations.

For Solicitors whose accounting year ends between 1st

January and 30th June 1985 there are transitional

arrangements whereby Regulations 10 (3) and 19 (2) need

not be complied with. For all other Solicitors it is now a

requirement that a detailed review of the position on the

Client Account be prepared every six months whereby

three sets of figures must be reconciled to each other:—

(a) Liabilities to clients as shown by the clients' ledger

accounts

(b) Liability to clients as per the clients' ledger control

account

A Solicitor must deliver a Bill of Costs or other written

intimation of the amount of the costs prepared (including

an interim bill) before costs may be transferred from

client account to office account; round sum withdrawals

on account of costs should not be made.

Under Regulation 32, each partner in a firm of

solicitors is equally responsible for ensuring that the firm

complies with the Regulations.

The definition of approved banks has been amended

and a listing of these are given in the First schedule. The

Society has the power to add other banks to this listing

from time to time.

In the case of solicitors with two or more places of

business or who are partners in associate firms each place

of business shall have the same accounting date and the

same reporting Accountant.

Regulation 22 sets out certain minimum work required

of the accountant examining the solicitors' books and

records for the purposes of the Regulations. The objective

of such examination is to ascertain whether or not the

solicitor has complied with the accounting and related

record keeping requirements applicable to transactions

involving client accounts and trust bank accounts.

•

Employment Legislation — Reduction

of Hourly Qualification

The attention of practitioners is drawn to the fact that

the weekly hourly limit for qualification under the

following Acts has been reduced as follows:—

1. From 21 to 18 Hours under the Unfair Dismissals

Act 1977

2. From 21 to 18 hours under the Minimum Notice

and Terms of Employment Act 1973

3. From 20 hours to 18 hours under the Redundancy

Payments Acts 1967 to 1979.

The changes were introduced by the Protection of

Employees (Employers Insolvency) Act 1984 which came

into force on the 30th November 1984.

•

Proof of Family Home Act Consent in

Separation Agreements

The Joint Law Society / Building Societies Committee

has been asked for its opinion on the practice of a

Purchaser's/Mortgagee's Solicitor insisting on a

Vendor/Mortgagor's Separation Agreement being

exhibited in their Family Home Protection Act 1976

Declaration.

The Committee feels that it is not proper practice for an

entire Separation Agreement to be exhibited as such

agreements usually contain very personal and private

information which would not be appropriate in a

document that will remain part of the title for many years.

The Committee recommends that a Purchaser/

Mortgagee's Solicitor should seek a Statutory Declara-

tion from the disinterested spouse confirming that the

property being sold/mortgaged is not a Family Home; in

the event that this declaration is not available the

Committee strongly recommends that as

prima facie

evidence that a property is not a 'Family Home' by virtue

of the fact that one spouse has not resided therein that a

purchaser/mortgagee's Solicitor should accept either:

1. A corroborative declaration from the Vendor/

Mortgagor's Solicitor that he/she has read the

Separation Agreement and quoting any relevant

paragraph therein or appropriate extracts

therefrom; or

2. A declaration from a party to the Separation

Agreement exhibiting a Solicitor's certified copy of

the relevant extracts or extract therefrom.

Where there is any doubt as to whether the property

being sold/mortgaged is or is not a 'Family Home' within

the meaning of the Act the purchaser/mortgagee's

solicitor should seek the consent of the Vendor/

Mortgagor's spouse or a Court Order dispensing with

such consent pursuant to Section 4 of the Family Home

Protection Act 1976.