QUESTION OF ETHICS

Q Under rule 19(1)(b) of the Solicitors Accounts Rules 1998, money to cover unpaid professional disbursements must be transferred from office to client...Q Under rule 19(1)(b) of the Solicitors Accounts Rules 1998, money to cover unpaid professional disbursements must be transferred from office to client account by the end of the second working day following receipt.

Does this apply where we have incurred a liability to pay the disbursements under a credit agreement such as that with the Land Registry?A No.

Professional disbursement is defined in rule 2(2)(s), page 687 of the guide as the fees of counsel or other lawyer, or of a professional or other agent or expert instructed by the solicitor.

Note (ii) to rule 19 states that money received for other unpaid disbursements for which the solicitor has incurred a liability to the payee (for example, travel agents charges, taxi fares) is office money.If these are the only unpaid disbursements included in the payment of costs rule 19(1)(b) page 702 in the guide will not apply in the first placePlease noteLimited liability partnerships (LLPs)The government has announced that the legislative changes to provide for LLPs will come into force on 6 April 2001.

However, it does not follow that practitioners will be able to convert to LLP status on that date.

The process will involve two successive steps registration as an LLP at Companies House followed by recognition as a recognised body by the Law Society under the new Solicitors' Incorporated Practice Rules 2001.

These rules will regulate all incorporated practices, whether companies or LLPs.

The working draft of the rules may be obtained from Professional Ethics.

There will be a mention here when further guidance is available.l Question of ethics is compiled by the Law Societys professional ethics guidance team.

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