Interest on transaction funds - mine or my solicitor's?

[Dinarius]

Not sure if this is the right forum for this question, but it relates to home buying and solicitors, so here goes..........

Due to delays in the closing of the sale of a property I own, my solicitor has had the purchaser's 10% in her account for about 2 months.

Finally, the sale is due to close next week and the balance is, apparently, "in the post".

My solicitor is going on holidays next weekend and, since the house I am purchasing with the money will not close until about mid-July, I am wondering what the protocol is in these situations?

The total sum involved is about €1m, so it ain't peanuts, at least not to me. If it was on deposit for 4-8 weeks it would earn a few bob.

a. Can I ask the solicitor for the interest on the €100k that she has had for nearly 2 months?

b. What about the total sum when it arrives in her letter box on Monday next?

Thanks.

D.

 

[oysterman]

Can I ask the solicitor for the interest on the €100k that she has had for nearly 2 months?

Of course you can. It's your money. Never feel embarrassed about looking after your own interests. Do get back to us with an update.

 

[CCOVICH]

Would it depend on whether or not the solicitor had earned or received any interest on their client account where your money was held?

 

[ubiquitous]

I would doubt very much if the client has any entitlement to interest in the above scenario. The solicitor may of course decide to pass on any interest benefit as a goodwill gesture but equally they may decide that this is simply a compensation for the cost & hassle of operating a client account.

 

[Dinarius]

Would it depend on whether or not the solicitor had earned or received any interest on their client account where your money was held?

It would, but I presume that solicitor's deposit funds like these in interest bearing demand accounts and not in current accouts. They'd be idiots not to.

As to the costs involved, deposit accounts don't usually incur charges, do they? So, I don't think that should be an issue.

D.

 

[CCOVICH]

It would, but I presume that solicitor's deposit funds like these in interest bearing demand accounts and not in current accouts. They'd be idiots not to.

I wouldn't have thought so, because they need to write cheques from these accounts (demand accounts wouldn't tend to have cheque books).

 

[Dinarius]

I wouldn't have thought so, because they need to write cheques from these accounts (demand accounts wouldn't tend to have cheque books).

That's a point, but they could have an instant demand account.

Also, a cheque takes four days to go through the system in this third world system of ours, more than enough time for the solicitor to juggle funds around to cover it.

D.

 

[MOB]

There are very precise solicitors regulations about interest on client funds.

Unfortunately, I can't remember them in detail (the book keeper in our office takes care of this stuff), but my recollection is:

1. A solicitor must account to a client for interest at standard demand rates available in the solicitors bank; Any higher rate negotiated by the solicitor (because of aggregating a lot of funds) is irrelevant

2. Interest below a certain figure can be ignored - it might be €200 or thereabouts, I really can't remember.


On €100k over two months, it is almost certainly the case that some interest should be paid to the client; just don't expect much of a rate.


Incidentally, did the delays in the closing result in extra work for the solicitor? It may be that if there was such extra work, it might not be within the scope of the fee originally quoted.

 

[Dinarius]

Incidentally, did the delays in the closing result in extra work for the solicitor? It may be that if there was such extra work, it might not be within the scope of the fee originally quoted.

No, the delay was entirely due to the purchaser trying to close another deal on his side.

Thanks for the reply.

D.