Good Practice

Conduct and service

Keep it simpleWhen giving clients advice, it is essential to ensure they actually understand what they are being told.

It is not enough to give advice in terms only the solicitor understands.

Nowhere is that requirement more essential, and any shortcomings more easily highlighted, than in the giving of costs information.In any civil litigation matter, it is inevitable that there will be a multitude of circumstances involving costs implications.

The decisions the client has to make will often depend on having a clear and accurate understanding of those implications.A typical case occurred when solicitors were handling a personal injury claim that was ultimately settled.

The offer accepted by the client was for a lump sum together with the payment of her reasonable costs, to be assessed if not agreed.However, the solicitors failed to make clear to the client that, if they were unable to recover all their costs from the other side, they would look to their client for the difference.

No initial costs information to that effect had been given.

When the offer was discussed, the solicitors' file-note read as though the client had been told she would receive all of the lump sum.

To be fair, it did not expressly say the client had been told that all her costs would be recovered, but it did invite that interpretation - and that is what the client said she understood was the case.

So, her complaint was prompted by a deduction from her damages.

Following a meeting, the solicitors wrote to the client about the terms of the settlement.

The message conveyed by the letter was that the solicitors might have to look to the client for payment of some of their bill if they could not recover all of it from the defendants.

However, this message was obscure.

There was also no evidence that the matter had been explained clearly to the client at the meeting.This situation resulted in a complaint when the solicitors sought to deduct slightly more than 5% of the settlement figure to cover unrecovered costs.

The solicitors then had to forego their unrecovered costs and pay 250 compensation to the client.

l Every case before the adjudication panel is decided on its individual facts.

These case studies are for illustration only and should not be treated as precedents.

LawyerlineFacing a service complaint? Need advice on how to handle it? Contact Mike Frith at LAWYERLINE, the support service offered by the Office for the Supervision of Solicitors, tel: 0870 606 2588.

Risk management

The ABC of risk management - part twol N - notification of circumstances.

Some firms are still struggling with the concept of what constitutes a circumstance that must be notified to your insurer.

Anything that may give rise to a claim should be notified.

If in doubt, check with your insurer.l O - organisation.

Be organised and have a structured approach to your day.

Plan what needs to be done and prioritise.

Have a quiet period in the day when you cannot be interrupted, to enable you to deal with difficult matters.

Proper planning prevents poor performance.l P - pleasing.

Do not engage in client pleasing.

If the client does not have a case, tell them, however unpalatable that may be.

Building false hopes is not fair on the client and will make your task ever more difficult the longer it goes on.l Q - ask the right questions of the client.

This is the only way to elicit the appropriate information so you can advise the client, who can then make an informed decision on what to do.l R - read things carefully.

This includes your outgoing post.

Make sure it says what it is meant to say, has the correct, enclosures and is going to the right destination.

If you sign it, you are responsible - not your secretary.l S - supervision.

This is essential for all staff, including partners.

This can be done through peer file reviews and appraisals for more senior staff and full supervision of more junior staff, with any letters and written advice they produce checked by seniors.l T - trainee solicitors, those well-known beasts of burden.

You have a responsibility to train them, not just use them to make the tea and take the blame when something goes wrong on a file.l U - undertakings.

Make a promise and you have to keep it.

Avoid sloppy, negligent undertakings that may have disastrous consequences for the partners.

There should be strict controls as to who may givean undertaking.

Always adhere to the Law Society smart card.l V - vetting procedures should be adopted in respect of every new matter.

Many problems could be avoided if more care were taken by firms when agreeing to act for a client.

Not least, how is the client going to pay?l W - wills.

These are still a constant source of claims.

They are complex documents that require considerable thought and advice.

Leave them to the experts.

They should not be provided for promotional purposes by conveyancing departments unless they know what they are doing.l X - X marks the spot to sign.

When you send documents to the client to sign, especially wills, do check them on their return to make sure they have been signed correctly.

l Y - Yukon, in Canada, is as good a place as any to go if it all gets too much.l Z - zenith to nadir.

Just because you have never had a claim does not mean you can ignore risk management.

Too many firms have gone from having a spotless claims record to a terrible claims record in a short period.

It only takes one rogue solicitor for this to happen.l This column was prepared by the St.

Paul risk management team.

QUESTION OF ETHICSQ I have made a payment for disbursements from my office account on behalf of my client.

I have money on account of costs in client account.

I am not sure if I can transfer funds into my office account to cover the paid disbursements.

If I can do this, do I need to submit a bill first?A Rule 22(1)(c) of the Solicitors' Accounts Rules 1998 permits the transfer of monies into office account where they are properly required in full or partial reimbursement of money spent by the solicitor on behalf of the client.

Furthermore, the transfer can take place in advance of preparing a bill of costs.

Q Do I really have to tell my client how to complain when he first instructs me?A Paragraph 7 of the Solicitors' Costs Information and Client Care Code 1999 requires all firms to have a complaints-handling procedure but does not require full details of this procedure to be given to the client at the beginning of the retainer.

However, the client should be given the name of someone he can speak to if he has any problems with the service being provided by your firm.

Dealing with problems as they arise may prevent them from becoming formal complaints.Please noteThe Solicitors' Publicity Code 2001 replaced the Solicitors' Publicity Code 1990 on 16 November 2001.

It also repealed practice rule 11 (names used by a firm).

The new code requires all firms to put 'regulated by the Law Society' on their notepaper.

Practitioners can postpone this until 1 January 2003 but only if they continue to comply with the 1990 code and the old practice rule 11.

l Question of ethics is compiled by the Law Society's professional ethics guidance team.

Send questions for publication to Austin O'Malley, the Law Society, Ipsley Court, Berrington Close, Redditch B98 0TD; DX 19114 Redditch;tel: 020 7242 1222.