Morrisons Solicitors — Terms of business

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Terms of business

1. Our aim and standard of care

1.1 We operate a system which requires us to meet certain standards of client care. Such standards include:

You will receive copies of all substantive correspondence;
Telephone calls from clients are to be returned during the course of the same day if at all possible. If the principal with whom you are dealing is unavailable, please either leave a message with the secretary or your name and telephone number on the principal’s voicemail;
Correspondence will be dealt with as soon as practically possible;
Letters to you or to other solicitors are to be written in plain, succinct English;
Appointments are to be given to you without any undue delay.

Please let us know us if you feel we are not keeping to these standards. In return, we ask you to respond to our requests promptly and to make payment without delay when required.

1.2 We are confident of providing a high quality service in all aspects. If, however, you have any questions or concerns about our work for you, please raise them first with the person dealing with the work. If that does not resolve the issue to your satisfaction or if you would prefer not to speak to that person, please raise the issue with the partner named in the letter confirming our instructions.

2. Charges

2.1 Our charges are primarily based on the time we spend dealing with a matter or transaction, e.g:

meetings with you and perhaps others, including the time it takes to prepare a written record of the meeting;
time spent travelling; waiting; or preparing, reading, considering or working on papers;
making notes;
letters, e-mails, faxes in and out;
making and receiving telephone calls;
research and preparation of any detailed calculations of charges, including those done by a costs draftsman.

2.2 We record time in units of six minutes each. We will normally round up time of less than six minutes to treat it as one unit.

2.3 In addition to the time spent, we may take into account a number of other factors. These include:

the complexity of the issues;
the speed at which action must be taken;
the expertise or specialist knowledge that the matter requires;
if appropriate, the value of the property or subject matter involved.

These factors will normally be taken into account in the rates quoted in your letter of engagement.

2.4 We try to be flexible in our charging approach and are in some cases prepared to consider alternatives to an hourly rate, such as fixed fees, blended rates, fee limits, percentage fees based on specific criteria (e.g. ‘no win, no fee’), or retainers. We are happy to discuss these alternatives but the charging method will only change if we agree to do so.

2.5 The rates which will apply to your matter will be advised in your letter of engagement. In April and October we will review the hourly rates to take account of changes in the court rates and in our overhead costs. We will notify you in writing of any increased rates. We may also increase our rates in the course of the matter to take account of, for example, the factors described in paragraph 2.3. We will notify you of this.

2.6 You will be responsible for paying our invoices, even if you are entitled to recover all or some of our charges and expenses from another party (see paragraph 5 below).

2.7 You will remain responsible for all our charges and expenses, even though they may be greater than the amount that you can recover from another party to the case.

2.8 We will inform you if any unforeseen additional work becomes necessary (for example, due to unexpected difficulties or if your requirements or the circumstances significantly change during the course of the matter).

2.9 We will make a separate charge for telegraphic transfers of funds out from our Client Account. The current rate is £25 plus VAT but this may be increased from time to time. We will advise you of any increase beforehand.

2.10 Any estimate is given only as a guide to assist you in budgeting and should not be regarded as a firm quotation unless otherwise agreed in writing.

2.11 For a variety of reasons some instructions are not completed. A transaction may be terminated before completion or you may decide not to proceed. In these circumstances we will charge for the work done.

2.12 Your liability to pay the charges and expenses due to us in this matter will be governed by English law. If it is necessary to take legal action against you to enforce payment, the action will be taken in the English courts or in such other court as we may choose.

3. Disbursements and other expenses

3.1 We will often incur expenses on your behalf, called disbursements, which we are contractually obliged to pay on your behalf. These include the costs of travel, accommodation, couriers, searches, registrations, transcripts, agents who conduct investigations, photocopying, binding, long distance telephone calls, facsimiles, and other reasonable out of pocket expenses. Disbursements incurred on your behalf will be included in our next invoice or, if they exceed £200, may be invoiced separately when incurred.

3.2 We will obtain your approval before incurring any substantial disbursements (including barristers' fees or expert witness fees) in litigation. We will normally either require you to provide us with sufficient funds to cover such disbursements or arrange for the person providing the services to invoice you direct. If we pay any such disbursements on your behalf, we will invoice you for them and payment will be due from you on delivery of the invoice.

3.3 We may sometimes be required to give an undertaking (i.e. a binding professional commitment) to pay an amount of money on your behalf in relation to a matter. We will not give such an undertaking without your prior approval which, once given, cannot be withdrawn. We will normally require that the relevant amount (or a reasonable estimate of it) is paid to us before we can give the undertaking.

3.4 If we have to incur additional expenses for non-legal staff working overtime on evenings or weekends in order to meet deadlines set by you, we may include overtime charges as a separate item on our invoices to you.

4. VAT

4.1 All fees quoted, disbursements and other charges are exclusive of VAT at the prevailing rate when our invoice is delivered. If we are satisfied that our services are outside the scope of UK VAT, then we shall not charge VAT. If you are a European Union business client outside the UK, we shall not charge VAT provided we receive such evidence as we may reasonably require that you are operating in a business capacity.

4.2 If our services are subject to VAT, interest, penalties or legal costs because any information on your VAT status is not correct, you must indemnify us fully on demand for these amounts.

4.3 If our invoices are not payable by you as our client but by a third party, you will still be liable for any VAT in respect of our charges

5. Payment of our charges and expenses by another party

5.1 We will discuss with you whether (and the extent to which) our charges and expenses might be paid by another person. In litigation, even if you are successful, the other party may not be ordered to pay all our charges and expenses, or they may be unable to pay them in full. If the other party is funded by the Legal Services Commission (formerly known as the Legal Aid Board) you may not get back any of our charges and expenses, even if you win. In all cases you remain responsible for our charges and expenses.

5.2 If you succeed in litigation, the court may order the other party to pay some or all of our charges and expenses. In that case, you can claim interest on them from the other party from the date of the court order. You must pay that interest to us, except to the extent that you have paid on account those of our charges and expenses that relate to the court order.

5.3 You will also be responsible for paying any additional charges and expenses that we incur in seeking to recover any of our charges and expenses that the court orders the other party to pay.

6. Other parties’ charges and expenses

6.1 In some circumstances — e.g. if you lose a case in litigation — the court may order you to pay the other parties’ legal charges and expenses. The money would be payable in addition to our own charges and expenses. In some cases, you may be able to take out insurance to cover the risk that you may have to pay legal expenses. If you require further details, please ask us.

7. Interest payments

7.1 We will hold in our Client Account any money we receive on your behalf. We will pay interest to you (or whomever may be entitled to it) at the rate payable in accordance with Law Society regulations. Payment of interest is subject to certain minimum amounts and periods of time, as set out in the Solicitors’ Accounts Rules 1998. We normally calculate the period for which interest will be paid from the date on which we receive the funds until the date we issue a cheque from our Client Account.

7.2 Your acceptance of these terms of business constitutes your authority for us to retain the first £20 of each amount of interest (when calculated) to help us cover the administrative expenses of calculating the interest and paying it to you. We may ask you to sign a separate letter of authority to confirm this.

7.3 If you are borrowing from a lender for a property transaction, we will ask the lender to arrange that we receive the loan cheque at least four working days before the completion date. If the money can be telegraphed, we will request that we receive it the day before completion. This will enable us to ensure that the necessary funds are available in time for completion. You should be aware that your lender may charge you interest from the date the loan cheque is issued or the payment telegraphed to us.

8. Invoicing and payment arrangements

8.1 In our initial letter we will have confirmed how and when you will be invoiced. We reserve the right to send you interim invoices. We will periodically tell you the time spent on your matter and the charges and expenses incurred to date.

8.2 Our invoices are due for payment immediately upon delivery. If you fail to pay us in full within 30 days after the day on which we send our invoice to you, then you must pay us interest at the rate set out in Section 6 of the Late Payment of Commercial Debts (Interest) Act 1998:

calculated (on a daily basis) from the date of our invoice until payment;
compounded on the first day of each calendar month; and
before and after any judgment (unless a court orders otherwise).

8.3 You may make payments on account of our charges or settle invoices by credit card. Details of cards accepted are given on our invoices. Payments in any currency other than sterling will be treated as their sterling equivalent at the date of conversion (less conversion charges).

8.4 In some cases we may ask you with authority at the outset to debit your credit card if sums, such as invoices or payments on account, remain outstanding. We will advise you, as soon as possible, if such payments have been debited.

8.5 If you have any questions about our invoices, you should contact our Financial Director, Michael Stonebridge, on 01737 854530 straightaway.

9. Indemnity

9.1 We may ask you to indemnify (i.e. reimburse) us in full from any expenses we may incur (directly or indirectly) following any breach by you of your obligations under this agreement or any other agreement between us, e.g. fees and expenses incurred if you fail to pay on the due date. We may calculate those fees and expenses on the same basis that we would charge another client if we were collecting a similar debt owed to them.

9.2 We may ask you to indemnify us, in full, from all expenses we may incur (directly or indirectly) in complying with your instructions, e.g. fees and expenses ordered by a court to be paid by us.

10. Storage of papers and documents

10.1 We are entitled to keep all your papers and documents while you owe us money, even after the work is complete. In any event, we will keep our file of papers (except for any of your papers which you ask to be returned to you) for at least one year. After that, storage is on the understanding that we have the right to destroy the file after such period as we consider reasonable. We will not destroy documents that you ask us to deposit in safe custody. We will not normally charge for storage, but we reserve the right to do so in some circumstances.

10.2 We will not normally charge for retrieving papers or documents from storage for your continuing or new instructions. However, we may charge for producing stored papers or documents to you or to another person at your request. Our charges will normally be based on time spent.

11. Copyright

11.1 We will retain copyright in documents drafted for you. You will be licensed to use them for the purposes for which they were prepared.

12. Data Protection Act

12.1 We are required by this Act to inform you that your particulars are held on our database. Unless you ask us not to, we may, from time to time, use these details to send you information which we think may interest you. We will adhere to the eight principles of data protection set out in the 1998 legislation.

13. Termination

13.1 Your right to terminate your instructions to us

If you wish us to stop acting for you, you may terminate your instructions by giving us notice in writing at any time. We will be entitled to keep all of your papers and documents while you owe money to us.

13.2 Our right to stop acting for you

We will only exercise our right to stop acting for you if we have good reason to do so and we must give you reasonable notice. Reasons for doing so include:

your failure to give us proper instructions;
your failure to give us the co-operation which we are reasonably entitled to expect;
if our continuing to act would be impractical, unethical or unlawful;
if you fail to provide us with (or to replenish) sufficient money to be held on account; or
if you fail to pay our invoices as and when rendered.

13.3 Our charges when we stop acting for you

If you terminate your instructions or if we stop acting for you, you will be invoiced for our charges and expenses up to the time we stop acting, unless the funding arrangement agreed between you and us prohibits us from so doing.

14. Partnerships and companies

If we receive our instructions on behalf of a partnership, company, corporation, government body, society, unincorporated association or trust we will assume that we are entitled to take instructions from any partner, officer (such as a director or secretary), executive, committee member, trustee (as appropriate), or a person appearing to be a senior employee, unless you inform us, in writing, that we may not do so.

15. Conflict of interest

15.1 An actual or potential conflict between your interests and the interests of another client of the firm may arise during the course of a matter. If this situation arises during our dealings with you, we will discuss the position with you and determine the appropriate course of action. In order to protect your interests, we may not be permitted to continue acting.

16. Quality assurance

16.1 To help us maintain uniformly high standards we have a quality assurance system, which may involve an external audit of a random sample of files. An external audit will only be carried out subject to a strict duty of confidentiality on the part of the auditors and under the supervision of a member of our firm. Your file will be available for external audit unless you tell us otherwise.

17. Money Laundering

17.1 Under the Money Laundering Regulations 2003 and the Proceeds of Crime Act 2002 we have an obligation to verify the identity and place of residence of all clients and we will therefore require you to produce suitable documentary evidence of these.

17.2 If we suspect that a client has received any asset or benefit derived from any criminal activity, however trivial, we are required to report our suspicion to the National Criminal Intelligence Service (NCIS). This statutory obligation overrides the duty of confidentiality that we owe our clients. We are then prohibited for taking any action until we have received clearance from NCIS (usually 7 days). While awaiting clearance, we are also prohibited from notifying the client that we have made the report. Full information on this is provided separately.

17.3 If while we are waiting for a report from NCIS you are unable to meet crucial deadlines then we will not be negligent.

18. Insurance Contracts – Financial Services Authority

18.1 We are not authorised by the Financial Services Authority. However, we are included on the register maintained by the Financial Services Authority so that we can carry on insurance mediation activity, which is broadly the advising on, selling and administration of insurance contracts. This part of our business, including arrangements for complaints or redress if something goes wrong, is regulated by the Law Society. The register can be accessed via the Financial Services Authority website at www.fsa.gov.uk/register.

19. Communication between you and us

19.1 We will normally act on your instructions given by letter, verbally in a meeting, by fax, or over the telephone. If given verbally, we reserve the right to ask for your instructions to be confirmed in writing. Because of the inherent dangers of corresponding by e-mail we will only correspond with you by e-mail at your specific request and this must be at your risk. If you correspond with us by e-mail, we shall take that as a request for us to correspond with you by e-mail.

20. Our liability to you

20.1 We are confident of giving you a high quality service. We accept, however, that very occasionally things may go wrong. In the unlikely event that we are negligent, it is a fact of modern life that we may be sued. For this reason, and to protect you as well as ourselves, we carry professional indemnity insurance cover that exceeds the minimum professional requirements set by the Law Society.

20.2 We review our insurance cover annually and increase it when appropriate. It is a fundamental term of our accepting instructions from you that our liability to you is limited to £1 million, or such higher sum as may be agreed between us in writing, on each claim that you may bring against us, for negligence, breach of contract, or both. We are happy to explain this policy further if you wish.

20.3 Nothing in these terms of business affects our liability for death or personal injury caused by our negligence.

20.4 Subject to paragraph 20.3 above, we are not liable to you for economic loss or any type of special, indirect or consequential loss (including loss or damage suffered by you as a result of a claim by a third party). This applies even if that loss was reasonably foreseeable or we had been advised of the possibility of your incurring it. ‘Economic loss’ means any increased costs or expenses, loss of profits, goodwill, business, contracts, revenues or anticipated savings.

21. Agreement

21.1 Unless otherwise agreed in writing, these terms of business apply to any future work you instruct us to do.

21.2 Your continuing instructions will amount to your continuing acceptance of these terms of business.

21.3 Any waiver or variation of these terms will not be legally enforceable unless:

made or recorded in writing;
signed by one of our partners; and
expressly stating an intention to vary these terms.

21.4 Your instructions will not create any right enforceable, by virtue of the Contracts (Rights of Third Parties) Act 1999, by any person who is not identified as our client in the transaction of matter.

21.5 If any of these terms is unenforceable as drafted:

it will not affect the enforceability of any other of these terms; and
if it would be enforceable as amended, it will be treated as so amended.