Policy on Holding Client Funds and Payment of Interest
The aim of this policy is to provide a clear and transparent provision on how The Law Firm Group will hold client monies and pay interest on those monies.
Where The Law Firm Group receives money from or on behalf of a client, it will be paid into a general client account in accordance with SRA Accounts Rules.
We will, on a per-matter basis, calculate and pay interest monthly on sums held for over one month in the client account at an equivalent rate to that of the currently published rate of interest on business client premium accounts with Metro Bank, except in the following situations:
– Where the amount of monthly interest is less than £100;
– On money held for the payment of professional disbursements, once counsel etc has requested a delay in settlement;
– On money held for the Legal Services Commission;
– On an advance from us into our general client account to fund a payment on your behalf in excess of funds already held for you in that account;
– Where we have requested to return funds to you and you have not co-operated with this request.
We reserve the right to charge a fixed fee of £60 plus VAT to perform an interest calculation on the funds that we hold on your behalf.
The Law Firm Group may transfer money to other designated client accounts from time to time. The interest payable to the client will however be at the rate specified above.
All client money will be held on instant access terms unless otherwise instructed.
In accordance with Law Society guidance, if the bank in which The Law Firm Group holds funds should fail, we reserve the right to disclose to the FSCS the names and other details of clients whose money is held there in order for those clients to claim compensation up to the applicable limit, currently £85,000.
We will not be liable to you or any third party for any loss or damage suffered as a result of any act, omission, fraud, delay, negligence, insolvency or default of any bank, financial institution, clearing or payments system nor that of the directors, officers, employees, agents or representatives of any of the foregoing.
Joint accounts – If The Law Firm Group hold money jointly with a client, interest earned on the account will be for the benefit of the client unless otherwise agreed. If money is held jointly with another practice, the allocation of interest earned will depend on the agreement reached between the parties.
This policy will be reviewed whenever there is a material change to the Bank of England base rate, and at least annually.
This policy was last reviewed and approved on 2 January 2023.