Solicitors going through the exercise of clearing their ledgers and dealing with unclaimed surplus client monies are being reminded of the role of the Treasury Solicitor's Bona Vacantia ('ownerless property') Division, which collects unclaimed funds on behalf of the Crown. The monies collected are transferred annually to the Exchequer to be dealt with in the same way as money raised by general taxation.

The division says that firms should already be aware of the Solicitors Accounts (Residual Client Account Balance) Amendment Rules 2008, which came in to effect on 14 July 2008 and deal with surplus client money and clearance of small residual client money balances. The Solicitors Regulation Authority is urging that client monies be returned promptly to the client following the end of the retainer.

The SRA has also simplified the position regarding the clearance of residual client balances under £50, which may be paid to charity without client authorisation provided the solicitor can demonstrate that all reasonable attempts have been made to establish the identity and return the monies to the rightful owner.

Balances over £50 (or balances under £50 not paid to charity) will continue to require SRA authorisation, as before.

The position regarding residual balances due to a dissolved company client remains unchanged. These funds (whatever the amount) remain bona vacantia funds and should be forwarded to the Treasury Solicitor. When a company that was registered under the Companies Acts is dissolved, all its property in England and Wales (but not its liabilities) pass to the Crown as bona vacantia, pursuant to section 654 of the Companies Act 1985. If the company's last registered address was in England or Wales (other than in the Duchies of Cornwall or Lancaster), the Treasury Solicitor is nominated by the Crown to deal with its assets. This includes surplus funds held in solicitors' client accounts, which are due to be refunded to a company client which is now dissolved.

While identifying the owners of residual client account balances, solicitors are advised to carry out checks (with Companies House and the London Gazette) to ensure that the company to which the monies are due to be returned is not dissolved.

The Treasury Solicitors' contact details, including further details of the Crown's entitlement to bona vacantia, as well as collection policies and procedures, are at http://www.bonavacantia.gov.uk.