Banking Crisis Update Advice
13 October 2008
The Law Society has updated their interim advice on mitigating any risk of liability for client accounts in the event of a banking collapse. The key change relates to qualified undertakings, and how the issues may vary for different types of transaction.
Recent unprecedented events have put strong pressure on the undertakings you give. We are in uncharted territory. However, it's vital that the value of solicitors' work is not diluted, and that you can continue to act in the best interests of your clients. The Society is discussing these pressing issues with the Financial Services Compensation Scheme, so our advice may be updated again early next week.
Please refer to our website at www.lawsociety.org.uk/bankingcrisis to see today's changes and to check for further updates next week.
Looking specifically at conveyancing, solicitors have a key role in the conveyancing process. Without solicitors, clients cannot move from house to house on the same day. This is our unique selling point in the market, and the Society's focus is on preserving this role. So while your liability for undertakings is of clear concern, it is important not to overreact, particularly in light of government statements of support for depositors. Solicitors may wish to review where they hold clients' money, but it would be disastrous to threaten the strength of our undertakings in conveyancing transactions, and so undermine our status as the lynchpin of the property market.
www.lawsociety.org.uk/bankingcrisis |
