The Gazette 1961 - 64

UNDERTAKINGS TO PRODUCE CERTIFICATES OF DISCHARGE FROM SCHEDULES A AND B INCOME TAX A solicitor who finds himself required to give, on a closing of a sale, an undertaking to produce a certificate of discharge from Schedules A and B Income Tax under section 6 of the Finance Act, 1928, should, it is hardly necessary to say, satisfy himself as to his ability to discharge his undertaking. This involves satisfying himself as to his client's liability for tax and if he is quite satisfied that the client has no such liability or that it has been cleared he can, with safety, give the undertaking in order to close the sale. There are, however, certain hidden dangers of which some members may not be aware and one of these might best be illustrated by the following example:—Supposing a client who is selling his own dwellinghouse is in a salaried job and the total of his income from his salary, which would be assessable under Schedule D, added to the total under Schedule A from the property of the house is exceeded by his various personal allowances, marriage allowances, etc. He is then in a position of being liable to a " tax on charges ", that is to say, he must when paying his ground rent deduct tax at the full standard rate and account therefor to the Revenue. He is, in effect, in the position of a collector of taxes but is not, of course, paying any tax on his own income. Suppose, also, that his tax position is such that any small increase in his income would bring him " over the line " and make him liable for both Schedule D and Schedule A tax. The solicitor on looking into his client's tax position, might feel quite justified in giving an undertaking to the solicitor acting for the purchaser of the premises to produce a certificate of discharge from Schedule A tax thereon as he would feel quite confident of being able to secure such a certificate without any difficulty, especially if his client had made returns over the years and had not been found liable to tax. However, if the client concealed from the solicitor, either fraudulently or without any fraudulent intent, a third source of income, say, from a small business carried on as a sideline or an income accruing to his wife and if this were to come to the notice of the Revenue after the sale had been completed and the undertaking given the solicitor could then find himself in a serious position. The client would find himself liable to Schedule D and, what is more important from the point of view of the solicitor giving the undertaking, Schedule A tax, and it could go back a good number ofyears. The primary liability to the purchaser in respect of the Schedule A tax would then fall on the solicitor on foot of his undertaking who would, in turn, have to look to his client.

SHARING PROFITS WITH UNQUALIFIED PERSONS

A member recently answered a press advertisement from a party who advertised that he was willing to undertake legal work on a part time basis. Member answered the advertisement and got in touch with the advertiser and it transpired that he was an unqualified law clerk. He stated to member that his terms for carrying out the work would be one-quarter the professional charges allowed for each of the items actually done according to the scales in operation. The member concerned asked the Council for their opinion as to whether or not such a course would be open to objection and the Council, on a report from a committee, stated to member that he should not enter upon the arrangement proposed. The authority for this is regulation 7 of the Professional Practice (Conduct and Disciplinary) Regulations, 1955 (S.I. No. 151 of 1955) 1963 calendar page 135, in which it is provided that a solicitor shall not agree to share with any un qualified persons his profit costs in respect of any business either contentious or non-contentious. Certain limited and special situations are excepted from this rule but the general rule is as stated above. Apart from the question of profit sharing with an unqualified person the Council do not approve of the employment of part time legal agencies for any legal work except in the recognised field of searches and costs drawing. A statement to that effect will be found in the GAZETTE for October/November 1960, at page 54. COUNTY CAVAN SOLICITORS' ASSOCIATION At the annual general meeting of the Association on the yth May, 1963 the following committee was elected: Messrs. S. J. Gannon, Killeshandra, P. Cusack, Ballyjamesduff, P. N. Smith, Cavan, T. C. Vance, Bailieborough, James Smith, Arva, G. V. Maloney, Cavan, Senator T. J. Fitzpatrick, Cavan and P. J. O'Reilly, Bailieborough. Mr. James Smith was appointed President and Mr. G. V. Maloney was appointed Secretary. DECISION OF PROFESSIONAL INTEREST Irish citizen charged with alleged offences under an English statute which does not apply in Ireland—warrant for arrest issued in England On the 6th December, 1960, the prosecutor was taken into custody by a member of the Garda