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You are advising the potential partners of an optometrists' practice and have been instructed to proceed with the incorporation of a limited liability partnership and drafting of a partnership agreement. You have been asked to recommend an accountant to deal with the finances of the partnership. Recently, you agreed with an accountant you met at a networking event that he will give you £100 of gift vouchers for each prospective client that you recommend to him.
Which of the following statements best reflects the position?
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According to Part 5.1 of the Solicitors Regulation Authority (SRA) Code of Conduct, solicitors must ensure that clients are fully informed of any financial or other interest they have in referring the client to another business or person. This transparency is essential to maintain trust and allow clients to make informed decisions. Additionally, the SRA Principles require that any recommendation made must be in the best interests of the client and should not compromise the solicitor's independence. Part 8.6 of the Code further emphasizes the need for clients to be in a position to make informed decisions about how to pursue their matter. While there is a prohibition on referral fees introduced by the Legal Aid, Sentencing and Punishment of Offenders Act 2012, this applies specifically to claims for damages for death or personal injury, as per section 56 of the Act. Therefore, informing the prospective partners about the arrangement with the accountant prior to any referral is crucial for compliance with professional obligations.
Key Point: Solicitors must disclose any financial arrangements or interests when referring clients to other professionals to ensure clients can make informed decisions and to maintain professional integrity and independence.
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