FAMILY LAW -- Matrimonial conveyancing -- legal aidThe family law committee has received queries concerning matrimonial conveyancing in legally aided cases.

This note outlines some of the relevant case law and its implications.Following Copeland v Houlton [1955] 3 ALL ER 178 and S v S (Legal Aid Taxation) [1991] Fam Law 271, the cost of conveyancing work necessary to give effect to the terms of a court order will usually be covered by the legal aid certificate.

This applies equally to consent orders and work necessary to implement them.

In Copeland, the plaintiff brought an action to have property held by the defendant conveyed to him on the basis that he was beneficially entitled to it.

The action was compromised as the defendant conceded that the plaintiff was entitled to the property and terms were agreed in a schedule to the order.

On taxation, the costs of conveyancing to implement the order were allowed on the basis of s 1(5) of the Legal Aid Act 1949, (now s 2(4) of the Legal Aid Act 1988), which defines representation as 'including all such assistance as is usually given (by a legal representative) in civil proceedings in arriving at or giving effect to a compromise to avoid or bring to an end any proceedings'.S v S concerned ancillary relief proceedings in which a consent order was entered into, in which life and endowment policies were to be surrendered and arrears on the mortgage on the matrimonial home were to be cleared and the mortgage redeemed by the wife entering into a new mortgage.

The matrimonial home would then be transferred to the wife subject to a charge in favour of the husband once the home was sold at a later date.

Difficulties arose when the insurance company lost the life policy and, due to the mortgage arrears, the building society took possession proceedings.

The result was that the wife's solicitors had to do considerable extra work in attempting to implement the order.

It was held that the work done to implement the order would be allowed on taxation, save for the work done in relation to the possession proceedings.

The points arising are:(a) work done in implementing an order can be included in a legal aid bill of costs;(b) any solicitor in doubt as to whether work to be done in implementing an order is within the scope of a certi ficate should contact his or her local area office.Prescribed legal aid rates do not apply to non-contentious work undertaken as a direct result of implementation of a court order.

The rates allowed should be those which are reasonable in all the circumstances, in accordance with the Solicitors Remuneration Order 1994 (see reg 3(2)(d) Legal Aid in Family Proceedings (Remuneration) Regulations 1991) and LAB costs appeals committee decision CLA10 (Legal Aid Handbook 1994, p.118).Despite the availability of legal aid to deal with matrimonial conveyancing, it may be advisable to discuss with the client whether it would be beneficial for the certificate to be discharged so that the work can be done on a private basis, particularly where an order for sale has been made.

If this course of action is being considered, the terms of the court order should be examined and each case should be looked at on an individual basis.

Clients must not be charged for work which could be done under a legal aid certificate.Dealing with work on a legally-aided basis means that the client's costs will be dealt with on his or her legal aid bill and the spouse's costs will appear in the bill as an inter partes element.

There may be an inter partes taxation of the conveyancing costs which is inconvenient and may involve the spouse in paying a taxing fee.

In any event, the assisted person must be told that the solicitor will charge for the work at a non-contentious business rate which may be higher than the legal aid rate unless a fixed conveyancing fee is to be charged, in which case their consent must be obtained.

A fixed fee simplifies matters but there are risks for the solicitor if difficulties or disputes arise.

Therefore, unless a fixed conveyancing fee is to be apportioned between the parties, it will be possible to tell them only approximately what the overall costs will be.

Legally-aided clients should also be told that the conveyancing costs will be rolled up into the statutory charge (if it applies), which can be helpful if the client cannot afford to meet conveyancing fees immediately.

In any event, unless a sufficient sum to cover unforeseen eventualities can by agreement with the paying spouse be held back to cover the spouse's costs, the client is at risk that the spouse will not pay his or her part of the costs.

The agreement to be sought with the non-legally-aided spouse should include consent to retention from the sale proceeds of that party's prospective share of the costs.

The final amount charged to that party is then the subject of taxation if not negotiated and there may well be an adjustive payment due back to the non-legally-aided party.Arguably, if the parties by mutual agreement go to another firm of solicitors for their conveyancing work they may sidestep the issue, but the assisted party's solicitor must find out which solicitor is involved and make sure that he or she is aware of the statutory charge and its implications otherwise funds may well be distributed without regard to that (or inter partes costs) with disastrous consequences.

Reg 87(1) Civil Legal Aid (General) Regulations 1989 provides that only the assisted person's solicitor or the board can give a good discharge for monies payable to an assisted person by virtue of an order or agreement made in connection with the action, cause or matter to which his certificate relates.On the other hand, if the client consents to the legal aid certificate being discharged this means that the conveyancing can be dealt with on a private basis with a quote given a nd the consent of both spouses obtained.

This also means the legally-aided client who is assessed as being liable to pay monthly contributions can stop these just as soon as the certificate is discharged.

The danger of this approach is that the client will be vulnerable if unforeseen difficulties arise, such as a spouse who refuses to sign a transfer or problems with enforcement or if the case is not quite finished for any other reason.

The position where a home is to be transferred is slightly different in that the non legally-aided spouse is likely to be charged for the work done by his/her solicitor, and it is therefore less likely that it would be worthwhile considering avoiding the problems of taxation by discharging the certificate and doing the work on a private basis.The allowance of costs both inter partes and against the Legal Aid Board is at the total discretion of the taxing officer.REVENUE LAW -- Revenue law committee: tax -- rebated insurance commissionsThe Inland Revenue published a statement of practice (SP5/95) on 31 March 1995 on the tax treatment of insurance commissions passed on by brokers, financial advisers and other intermediaries to their clients.

The view expressed in the statement of practice was that rebated commissions received by policy holders would be liable to income tax under sched D, case VI.

The revenue law committee's view, which has been put to the Revenue, was that the practice outlined in the statement was incorrect, unsupported by any case law, and that it could lead to absurd conclusions in other situations where commission is involved.In a press release, dated 19 October, the Revenue has announced that it has changed its mind, and that following discussions with various representative bodies (including the Law Society represented by the revenue law committee), it has concluded that it will not tax ordinary policyholders on commissions rebated to it.

It says that this represents a partial change of view from that expressed in SP5/95, and that it will be publishing a revised statement following further discussions with the representative bodies.