In a continuing series, the Law Society's practice advice service offers guidance on a range of issues
Q In which areas of law is it possible to use a conditional fee agreement?
A Section 58A of the Courts and Legal Services Act 1990, as substituted by section 27 of the Access to Justice Act 1999, states that 'the proceedings which cannot be the subject of an enforceable CFA are (a) criminal proceedings, apart from those under section 82 of the Environmental Protection Act 1990 and (b) family proceedings'. The definition of family proceedings can also be found in this section. The Conditional Fee Agreement Order 2000 allows all such agreements to provide for success fees except for proceedings under section 82 of the Environmental Protection Act 1990 where success fees are not permissible (section 3).
Q I am having difficulty in tracing the beneficiary of an estate I am administering. How do I deal with this problem?
A
If beneficiaries cannot be traced, there are a number of ways to deal with the problem. For example:
For further guidance, see the Law Society's Probate Practitioner's Handbook, 4th edition, available from the Law Society bookshop (tel: 020 7320 5640).
Q My client is buying a property adjacent to a church. Do I have to carry out a chancel repair search?
A Chancel repair liability can only affect land within a Church of England or a Church In Wales parish that has a vicar (not a rector) and has a church dating from before the Reformation.
However, later adjustments to parish boundaries may vary this. The search can be made via the National Archive Office (tel: 020 8876 3444) or via the National Land Information Service (www.nlis.org.uk). The search should reveal whether there is a potential liability to contribute to the cost of repairs to the chancel of a church.
It is not easy to define with certainty properties that are affected by liability since the records held at the National Archive Office are incomplete. If it appears that liability may exist, solicitors should advise clients to consider taking out insurance to cover this liability. In some cases, potential liability is shown on the charges register of an affected title. For further information and a summary of recent case law, see the Law Society's Conveyancing Handbook, 11th edition, which is available from the Law Society bookshop.
Q My client wants to appoint me as an attorney. What do I need to consider in respect of my costs?
A It is recommended that the solicitor's current terms and conditions of business (including charging rates and the frequency of billing) be discussed with and approved by the donor at the time of granting the power. It is important to comply with the Solicitors' Costs Information and Client Care Code 1999.
As information on the prescribed form of enduring power of attorney is ambiguous about the remuneration of professional attorneys, it is recommended that a professional charging clause be included in the power for the avoidance of doubt.
Where a solicitor is appointed sole attorney (or is reasonably likely to become the sole attorney), or where two or more solicitors in the same firm are appointed and there is no external attorney, the donor should be informed of the potential problems of accountability if he were to become mentally incapacitated.
If necessary, arrangements could be made for the solicitor's costs to be approved or audited by an independent third party in the event of the donor's incapacity. See the Law Society's Enduring Powers of Attorney booklet, which can be found on the Law Society Web site: www.lawsociety.org.uk or obtained from the Society's practice advice service.
Q I act for a claimant in civil litigation proceedings and have just completed preparation of the trial bundles. Who bears the cost of this?
A In the absence of any provision in the rules, the cost of preparing trial bundles is part of the claimant's general costs, the reasonable costs of which may be recoverable if your client goes on to win the case (see Blackstone's Civil Practice 2004, page 666).
Q My client is based overseas and is purchasing a property in the UK. Will he be liable to pay VAT on his legal costs?
A Yes. The supply of legal services in relation to UK land is always subject to UK VAT at the standard rate wherever the client is based.
Customs takes the view that land-related services include all services that relate directly to specific sites or property. This would include conveyancing services, advice on the sale, disposal, transfer or surrender of an interest in or right over land or buildings, advice on title, and advice on applying for or challenging the refusal of planning permission.
Customs does not regard the administration of a deceased's estate that includes property situated in the UK as a land-related service. To fall outside the land-related category, the legal services must primarily involve some other area, for example, a company acquisition to which the land element is incidental - in such a case, a single composite bill would also help to support an argument that the legal services were not land related.
This column is compiled by the Law Society's Practice Advice Service, tel: 0870 606 2522. Send comments to the Practice Advice Service, the Law Society, 113 Chancery Lane, London WC2A 1PL. The service endeavours to ensure that the information provided is correct, but does not accept liability for error or omission. This publication is intended for information purposes only and solicitors should not act on the basis of the information provided alone, without verifying it first
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