Question of ethics archive

Important: The guidance below was written and issued before the introduction of the SRA Handbook on 6 October 2011, and may refer to regulatory material that is no longer in effect. Although it may still be relevant, this guidance has not been rewritten in light of the wide-ranging regulatory changes implemented on 6 October 2011. Accordingly, it has been archived.

February 2010

Contract races

Q. I act for a client in selling his property. I have submitted contracts to two prospective buyers and have complied with rule 10.06 of the Solicitors’ Code of Conduct 2007. However, one buyer has just withdrawn from the transaction. I’ve spoken to my client who says he does not want the other buyer to know this, but will I be in breach of the rules if I fail to inform the remaining buyer?

There is no specific obligation under the Code to inform the other buyer and since the information is confidential, you cannot disclose it without your client’s consent. However, you are required to act with integrity (rule 1.02) and you cannot use your position to take unfair advantage of anyone for your own or your client’s benefit (rule 10.01). This means that whilst you are not required to volunteer the information, you cannot deceive or mislead the other buyer or their solicitor, nor take unfair advantage of them. If a situation were to arise where this could occur, you would have to immediately cease acting if your client still refused to agree to the disclosure.

Failure to reply

Q. I am acting for a client in a matrimonial retainer. I have been in correspondence with the solicitors acting for the husband in respect of a number of matters, but have received no reply to my last three letters. I would normally ask my client to speak to the husband, but that is not an option since she was the victim of domestic abuse. Is the husband’s firm in breach of a rule in failing to deal with my correspondence?

No. There is no specific rule in the Code which obliges the other firm to reply to your letters. The firm will of course have a duty to act in the best interests of their client and to provide a good standard of service (rules 1.04 & 1.05), which includes keeping their client informed and seeking instructions where necessary. However, whether they send a substantive reply depends on their client’s instructions in this respect. If there are reasonable grounds for believing that the firm are simply failing to refer your correspondence to the client, then in accordance with rule 10.04(b), you could warn the firm that if you do not receive a reply, you will contact their client direct (see rule 10, guidance note 18). If you do write to the husband, it would be sensible to send a copy of the letter to the other firm. 

Q. I understand that changes have been made to rule 2 in respect of information which must now be given to clients in respect of their bills. However, I am not clear whether we are still required to print the information on the bill and if so, what form this should take?

Following the abolition of remuneration certificates in August 2009, emergency rule 2.08 was introduced as a temporary measure. The changes to which you refer – the amendments to rule 2.05 - will come into effect on 1 March 2010 and will replace emergency rule 2.08. Under the existing rule 2.05, you already have to tell clients who to complain to in the event of a problem at the outset of a retainer. In future, you will also have to tell the client (in writing) that:

  • the complaint could include a complaint about the firm’s bill;
  • there may be a right to object to the bill by making a complaint to the Legal Complaints Service, and/or by applying to the court for an assessment of the bill;
  • if part or all of a bill remains unpaid, the firm may be entitled to charge interest.

The rule does not require you to print any information on your bill. However, the new guidance note 49B states that in certain circumstances, it will be appropriate to remind clients of the information and gives examples of when this would be the case. One way of doing this may be to print the information in a prominent position on your bills, in whatever format you choose.