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GAZETTE
P R A
I C
N O T E S
AUGUST/SEPTEMBER 1995
Prohibition on lodging for
collection of unendorsed
third-party cheques - Section
76(17), Solicitors
(Amendment) Act, 1994
Undertakings
A solicitor should not give any
undertaking in respect of clients'
monies whether in contentious
business or otherwise unless either -
(i) he makes it clear to the recipient
of the undertaking that his
undertaking could be frustrated
by the client refusing to endorse
the relevant cheque or negotiable
instrument pursuant to section
7 6 ( 1 7) of the Solicitors
(Amendment) Act, 1994; or
(ii) he obtains an irrevocable
authority from the client to
endorse the relevant cheque or
negotiable or non-negotiable
instrument on behalf of the client
to enable the solicitor to collect
the proceeds of the relevant
instrument or lodge to his client
account as the case may be.
Even if there is no undertaking
involved relative to a client's business
a solicitor might deem it prudent to be
able to collect or negotiate a cheque or
other negotiable or non-negotiable
instrument in the course of acting for
a particular client.
Proper Procedure
In order to comply with section 7 6 ( 1 7)
in the above circumstances a solicitor
receiving a cheque drawn in favour of
a client or in favour of another person
(other than the solicitor himself, his
firm or a partner) should do one or
other of the following:-
(i) have the client or other person
personally endorse the cheque in
favour of the solicitor or his firm
(even if there is an authorisation
in place unless it would
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unreasonably delay compliance
with the undertaking or the
i
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implementation of the relevant
business); or
(ii) with the prior authorisation of the
client (or other person), endorse
the cheque in favour of himself or
his firm
per pro
(i.e. on behalf of
and with the authority of) the
client (or other person) pursuant
!
to section 91 (1) of the Bills of
Exchange Act, 1882 (which
provides that - "Where, by this
Act, any instrument or writing is
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required to be signed by any
!
person, it is not necessary that he
should sign it with his own hand,
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but it is sufficient if his signature
!
is written thereon by some other
person by or under his
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authority.") e.g. an endorsement
as follows: "[Solicitor's
signature]
per pro
[Payee's name
as on cheque]. Pay [Solicitor's
|
Practice Name ] ."
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The Society strongly recommends that !
all solicitors should observe the spirit
!
as well as the letter of section 7 6 ( 1 7)
; of the Solicitors (Amendment) Act,
I
1994, and that authorisations from
!
clients to endorse cheques or
negotiable or non-negotiable
instruments should not be obtained as
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a matter of course but should only be
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obtained in circumstances where the
prompt conduct of the client's
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business makes it necessary for the
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solicitor to endorse cheques or other
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negotiable instruments instead of
having this done by the client.
Authorisation
I, [Name and address of client or other
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I person in whose favour cheque is
drawn] hereby irrevocably authorise
j
you [Name and address of solicitor or
solicitor's firm] as my agent/agents to
endorse in your favour or in favour of
your firm per pro myself, that is to
say, on my behalf and with my
authority, any unendorsed cheque or
other negotiable or non-negotiable
instrument drawn in my favour or
belonging to me which you receive in
your capacity as my solicitor, to
enable you to collect same to any
designated client bank account kept
by you or otherwise negotiate same.
Dated this
day of
1995.
Signed
Witness
Adequate Supervision of
Apprentices
For the Attention of all Master
Solicitors and their Apprentices
The Law Society has received a
number of complaints regarding the
excessive responsibility which is
being delegated to apprentices at the
early stages of their training, and in
particular prior to attending their
initial training course in the Law
School.
Masters are reminded that apprentices
must receive an adequate level of
supervision at all times in the course
of the apprenticeship. If the master is
unable himself/herself to give such
supervision, appropriate alternative
supervision should be arranged. This,
in the first instance is the
responsibility of the master. In the
initial stages of training the Society
strongly recommends that the master
should accompany the apprentice to
the closing of at least a few sales
before such apprentice can attend a
closing alone. It is not the duty of the
solicitor acting on the opposite side of
the transaction to train the apprentice
of a colleague.