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I spoke recently to a client who previously used another solicitors’ firm. The solicitor held his deposit in relation to a commercial transaction for a period of three months. The deposit was 25k. The client didn’t know that he could have asked for the interest accrued on the money whilst it sat in the solicitor’s client account and the solicitor didn’t offer it to him.
If the solicitor holds your money in his client account, then he doesn’t always have to pay interest to you. In particular, there’s no requirement for him to do so if the sum is 20 pounds or less.
No interest is payable to you if the money held doesn’t exceed the following amounts and times set out below;-
1,000 pounds for less than 8 weeks.
2,000 pounds for less than 4 weeks.
10,000 pounds for less than two weeks.
20,000 pounds for less than one week.
If this guideline is exceeded, then you are entitled to ask for interest to be paid to you.
If more than 20,000 pounds is held for less than a week, then although the guidelines say generally that interest doesn’t have to be paid, this is only if it is fair and reasonable not to do so in the circumstances of the case. Discretion has to be exercised by the solicitor in the client’s favour however.
7 Responses to “Interest – its you’re money he’s holding – Does my solicitor have to pay me interest if he’s holding my money in his bank account?”
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September 15th, 2008 at 2:33 pm
Hi I would like to know if my solictor is duty bound to pay intrest on money that he has held in trust for my son for the last 7 years the money was left to my son by my wife who is deceased, I have requested to the solicitor to put the money in a saving account for my son but I do not think this was done . Where do I stand on this matter any info will be greatly appreciated. Yours P .Cooper
September 16th, 2008 at 9:16 pm
Hello Patrick,
Many thanks for your enquiry. It’s not strictly a conveyancing matter so I don’t know the immediate answer unfortunately. I’ll ask our solicitor at the firm for you and come back to you a.s.a.p. Hope this is ok.
Kind regards,
Gemma
September 18th, 2008 at 3:04 pm
Dear Patrick,
I have looked into this matter for you and think I can offer a little assistance.
Firstly, did you know there is a free advice line run by the Legal Services Commission (who provide legal aid)? You could try calling their helpline, the number is 0845 345 4 345.
“Community Legal Advice:
A free, confidential and impartial advice service paid for by legal aid
Mon – Fri 9am – 6:30pm
Calls from 4p/min – or get us to call you back ”
The second thing that might be of assistance to you is a copy of the Solicitors Accounts Rules 1998. These set out the rules relating to holding clients’ monies and when interest is payable to a client.
Part C of the Accounts Rules relate specifically to interest payments. Visit “http://www.sra.org.uk/solicitors/code-of-conduct/accounts-rules.page” to view the full set of rules. They are pretty self explanatory and it all appears to depend on whether the money is held in a designated deposit account or in the general client account. The amount of money held will also affect whether or not payment is due to you.
I sincerely hope all this will be of assistance to you. If you do need further help or information, please do let me know and thank you for visiting my site.
Kind regards,
Gemma
March 11th, 2009 at 3:28 pm
This article was useful for me!
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I work at a lovely firm of Liverpool Solicitors!
March 31st, 2009 at 9:41 am
Thank you, I didn’t know that but was trying to find out.
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Our family loves to holiday at the brilliant caravan parks in North Wales.
October 11th, 2009 at 9:23 pm
Hi,
I had a recent divorced and for financial settlement with my ex-wife, she transfered the said amt of £12700 into my solicitor account via her solictors.
Now my solicotor has increase a sudden fee, while finalising the bills with me.
To me i can not settle the account with my solicitor without reconcile the account fully.
In this situation Does my solicitor, is doing right by holiding my own money ih there account, being i am denying to settle the account only thing is reconcile the accounts.
Are they legally bound to hold my money, if so will they give me the interest on it.
Pls advice
Thanks
Preet
October 16th, 2009 at 11:53 am
Dear Preet,
If your solicitor is holding your money then there are rules to say when he has to pay interest to you and when he does not.
The solicitor cannot just suddenly increase the fee on the final bill if he has not told you in advance. I would suggest that you contact the Legal Complaints Service who can discuss this with you. They have a helpline number, which is 0845 608 6565.
Hope this helps – Good luck!
Gemma