Every solicitor who handles money has to answer one question over and over: does this belong to the client or to the firm? Get it right and client money stays protected and separate, exactly where it should be. Get it wrong and the firm risks paying its own bills out of client funds — a breach that regulators take very seriously.
This lesson builds your answer to that question from the ground up. By the end you'll know what counts as client money, how to classify any payment that arrives, and how to handle and bank it safely.
What this lesson covers:
- Client Money and Client Accounts — what client money is, the two accounts a firm must keep, and the safe default when you're unsure.
- Classifying Money Received — the factors that decide ownership, and how costs, disbursements and transaction funds are treated.
- Agreed Fees and Excluded Money — the narrow situations where money is the firm's on receipt and the categories carved out of client money.
- Handling and Segregation — banking deadlines, mixed payments, transfers to the business account, and the limited firm-money float allowed.
Work through it in order — each section builds on the last.