Lords reduce the duty to wives

Solicitors who advise married women asked by their husbands to help fund businesses by agreeing to a second mortgage on their homes this week saw their scope of duty to the women substantially reduced in a landmark decision by the House of Lords.

The House of Lords reversed a decision made by the Court of Appeal in Royal Bank of Scotland v Etridge and others, which declared that solicitors had to satisfy themselves that the husband had not brought undue influence to bear on the wife's decision, or obtained her consent by misrepresentation.

This involved investigations into issues such as the financial state of the business and the state of the marriage.This week's decision drastically limited the solicitor's role to 'making sure that the wife understands the nature and effect of the transaction'.In the original case, eight wives appealed against the repossession of their houses, claiming that their husbands had unduly influenced their decisions.

The mortgage lenders argued that if the loan were to be set aside, they would have a claim against the wives' solicitors for failing to take steps to ensure that the wives were not unduly influenced.

Jeremy Scott of the Solicitors Indemnity Fund, which co-ordinated the solicitors' case, welcomed the decision and said: 'A solicitor specialising in conveyancing and mortgages cannot also be expected to be an expert in company finance and psychology.

If this decision had not been overturned by the Lords, many solicitors would have had to refuse to handle routine transactions.'Victoria MacCallum