We will apply the same time periods when calculating the date that monies are received by the recipient.
MONIES HELD ON MORE THAN ONE MATTER
Where we hold monies on more than one matter for a recipient, interest will be calculated separately for each individual instruction – unless it is fair and reasonable to aggregate the interest.
Interest will be paid at the conclusion of the retainer, or on a quarterly basis if monies are held for longer than three months.
If we hold money jointly with a client, the interest earned will belong to the client, unless we agree otherwise.
If we hold money jointly with another firm, we will agree with the other firm how interest will be allocated.
Where we pay monies to clients by cheque, some clients will delay in paying the cheque into their bank. We will pay additional interest only where it is reasonable in all the circumstances to do so.
Where we do recalculate interest and/or issue a further cheque, we reserve the right to charge for the additional work involved.
INFORMING CLIENTS OF OUR INTEREST POLICY
We will notify clients of our interest policy in our terms of business.
Failure to explain our policy on payment of interest could give the recipient unrealistic expectations about the amount of interest they will receive. Ultimately, this could lead to complaints to the firm or the Legal Ombudsman.
Contracting out usually takes the form of agreeing that we will pay no interest or a reduced amount of interest. It can also include agreeing to pay 100% of the interest received on monies held on general client account, where this exceeds the amount that would normally be paid under this policy.
We may, by written agreement with the client and/or recipient, contract out of the terms of this interest policy.
We will only contract out where doing so provides a fair outcome. This will depend on all the circumstances, eg:
The amounts involved – the larger the sum of interest, the greater the onus on us to show that the client has been treated fairly.
The status and bargaining position of the client – it may be less appropriate to contract out if the client is a private individual with little legal exposure than for a commercial client where the interest represents a very modest proportion of the overall transaction.
Whether there are specific reasons for contracting out, eg tax reasons or religious belief.
When agreeing to contract out we will:
Act fairly towards our client;
Provide sufficient information to enable the client to give informed consent.
FAILURE TO COMPLY WITH THIS POLICY
We are required to notify the SRA if we breach the SRA Accounts Rules 2011, including the rules relating to the payment of interest. If you suspect that we have breached this policy, please report your concerns to Jessica May, our COFA by emailing firstname.lastname@example.org
All staff will receive training, as necessary, on our interest policy.
MONITORING AND REVIEW
Jessica May, the COFA, is responsible for this policy.
All staff must be aware of and adhere to it. You may be liable to disciplinary action if you fail to comply with the provisions of this policy or related policies and procedures.
Jessica May will monitor compliance with this policy.
This policy will be reviewed annually.