Guidance related to Rule B4: Client Communication Generally
This rule requires solicitors to provide information in writing
to clients about certain specific matters namely
- An outline of the work to be done;
- An estimate of the total fee including VAT and outlays or the
basis upon which the fee will be charged, including VAT and
outlays;
- Details of any contribution towards Legal Advice &
Assistance or Legal Aid and details of the effect of preservation
or recovery of any property if relevant;
- Who will do the work;
- Who the client(s) should contact if they wish to express
concern about the manner in which the work is being carried
out.
With certain exceptions (see below) this information must be
provided at the earliest practicable opportunity upon receiving
instructions. It does not have to be contained in a single letter
to comply with the rule, but unless there is a particular reason
why it cannot be done in a single letter, there is a risk of
omitting certain of the information if it is done in different
stages.
If a practice unit is tendering for new business, either from an
established client or a new client, the information can be given
when tendering. If it is, and the tender is accepted, there is no
need to repeat the information subsequently.
It is quite in order to give the client more information than is
necessary to comply with the rule, but the rule sets out the
minimum requirement.
To avoid any risk of misunderstanding or confusion, the outline
of the work to be done must provide sufficient
information so the scope of the work and the
significant elements covered can be clearly identified. However it
need not rehearse in detail every step to be taken in progressing
and completing the work where that information is not required to
enable the client to check that your description of work to be done
meets with his intentions. You should always bear in mind your
obligation to communicate effectively with your client and others
in terms of Rule B 1.9.
Exceptions
There are only 3 automatic exceptions to the rule:
- First where a client regularly instructs you in the same type
of work, the information does not have to be provided repeatedly
but it will have to be provided on at least the first occasion, and
it will have to be updated if there is a change in the information
previously provided.
- The second exception is where there is no practical opportunity
for the information to be provided before the conclusion of the
work. That means where the work is completed at a single meeting.
For example a client who may be about to go on holiday and wishes
to make a will may have instructions implemented immediately and
sign the will at the first meeting. Where you are receiving
instructions on an agency basis it is not necessary to provide
information to the principal solicitor acting, although it is
prudent to have an agreed basis of charging for agency work.
- The third exception is children under the age of 12. If the
client is the child's parent or guardian (for example in a personal
injury case) the information will still need to be provided. This
exception does not, however, in any way depart from or dilute your
obligation to communicate effectively with your client in terms of
Rule B 1.9. Where your client in under the age of 12 special
considerations may apply which may suggest that a method of
communication other than correspondence is likely to be more
effective or more appropriate. That is a matter on which you
should exercise your professional judgement in all the
circumstances of the particular case.
Fees
As there is no Law Society Table of Fees, it is not appropriate
to refer to fees recommended by the Society. If, for example in
executries, the file is to be feed by an external fee charger such
as an Auditor or Law Accountant, the basis on which the external
fee charger will be asked to fee up the file needs to be stated to
the client.
As well as the hourly rate any commission which will be charged
on capital transactions or on the sale of a house would need to be
included. In any matter where the account is being rendered on a
detailed basis, the charges for letters, drafting papers, etc will
need to be expressed as well as the hourly rate. They can be in a
separate schedule referred to in the basic letter. If hourly
rates are reviewed during the course of the work, the clients will
need to be told about any increase or there is a risk that practice
units will be unable to charge the higher rate.
In terms of Section 61A of the Solicitors (Scotland) Act 1980,
where a solicitor and client enter into a written fee charging
agreement it is not competent for the Court to refer any dispute in
the matter to the Auditor for taxation. Where an hourly rate is
specified, and that is accepted in writing, the client would still
be entitled to seek a taxation, but would not be able to challenge
the agreed hourly rate at such a taxation.
It should be made clear at the outset whether the fee quoted is
the fee to be charged or only an estimate. If it is not stated as
an estimate and the client accepts it in writing, that could be
regarded as a written fee charging agreement under Section 61A of
the 1980 Act. If a client has been given an estimate, they must be
advised in writing when it becomes known that the cost of work will
materially exceed such an estimate and when the limit of the
original estimate is being approached.
Information should be clear, and terms with which the client may
not be familiar such as "outlays" may need to be briefly explained.
If a payment to account is required, that should be clearly stated,
as well as the consequences of failing to pay it on time. For
example in a Court matter if the client is advised that failure to
make a payment to account will lead to you withdrawing from acting,
there is unlikely to be a professional difficulty about withdrawing
from acting in compliance with that. However if the consequence is
not stated, and the proof is approaching, you could be vulnerable
to a complaint if you withdraw at a late stage to the potential
prejudice of the client.
If the clients costs are to be paid by a third party such as a
Trade Union or Legal Expenses Insurer, specific details of the
basis of charging do not need to be set out when writing to the
individual client but any part of the fee which that client may be
asked to pay should be included- such as a success fee in a
speculative action.
While it is not strictly necessary under the rule, it is also
strongly recommended that any potential liability for other
people's costs should be explained. This would include a tenant's
liability to meet a landlord's fees as well as the potential
liability for expenses in a Court action.
Executries and Trusts
In executries where the only executors are solicitors in the
practice unit, the information should be provided to the residuary
beneficiaries, as they will be meeting the fees out of their shares
of the residue. In other executries the information should be
provided to the non solicitor executors.
Legal Aid
It is not necessary to comply with the rule for you to explain
the statutory payment scheme to Legal Aid clients in relation to
Legal Advice & Assistance or Legal Aid. You may wish to forward
copies of leaflets provided by SLAB to clients in receipt of Advice
& Assistance or Legal Aid. If you do wish to communicate
detailed advice to clients about Advice & Assistance or Legal
Aid, including for example the client's requirement to report
changes in circumstances, that is optional and may be done in a
separate letter.
Waivers
The Council have power to grant a waiver which may be subject to
conditions. In practice this power is delegated to the Professional
Practice (Rules and Waivers) Sub-Committee of the Regulatory
Committee, which meets monthly except in August. A specific reason
should be given for seeking the waiver, and the request is likely
to be continued for such information if it is not provided
initially.
Failing to Comply with the Rules
Breach may be treated as professional misconduct. For the
avoidance of doubt, an occasional failure to send the information
required, or sending information which does not fully comply with
the rule, is likely to be dealt with in the first instance as a
matter for professional practice guidance. However regular failure
to provide the information required may lead to a formal complaint
about your conduct, which may be categorised as professional
misconduct.
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