The Gazette 1983

GAZETTE

N O V E M B E R

1983

Practice Notes

Not so many years ago there would not have been any documentation beyond a deposit of the Land Certificate or title deeds, often made directly to the Bank Manager without the intervention of any solicitor. The inadequacy of the equitable deposit in the absence of satisfactory collateral, as an enforceable security, has been only one of a number of factors which have encouraged banks to insist on mortgages or charges being in writing. Three separate difficulties arise where the customer does not wish to enlist the assistance of his own solicitor, two for the bank's solicitor and one for the bank itself. The solicitor's first problem is that of conflict of interests, if he does agree to act for the customer — which he would be foolish to do — and the second arises if the customer insists on not engaging a solicitor, in ensuring that the queries on the title which must, in the light of the Northern Bank -v- Henry case, [1981] I.R. 1 be raised as answered with a sufficient degree of responsibility. The bank's difficulty, particularly if its own solicitor arranges for the completion of the mortgage and spouse's consent, whether acting for the customer or not, is the allegation of undue influence. Recent cases in England, where the doctrine of undue influence does not seem to have been as frequently relied on as it has been in Ireland, principally Lloyds Bank -v- Bundy [1974] 3 All E.R. 757 and most recently National Westminster Bank -v- Morgan (The Times, July 5th 1983), have shown that the Courts there are likely to view banks as having such a fiduciary duty to the person executing the document in favour of the bank as to require such person to have independent legal advice. Accordingly, solicitors acting for banks should not merely advise the customer that it would be unwise for the solicitor to act for or advise him in the matter, but should also advise the bank of the wisdom of ensuring that the customer and the bank receive adequate independent advice. •

Referral Service —Flat Developments

The Conveyancing Committee has been asked to establish a referral system under which the firms of solicitors with expertise in the establishment and operation of schemes for the sale of flats would make their expertise available to other firms on a referral basis. Accordingly the Committee would invite firms with expertise in this area to submit their names to the Committee with a view to being included on a panel of solicitors to whom referrals would be made. The basic principle upon which the referral system will operate is that the consultant firm will not, in normal circumstances, accept from the client within 3 years of the completion of the consultancy assignment any work in the area of flat development schemes without the approval of the referring firm. It is envisaged that it will not be essential in most cases for the consulting firm to deal directly with the client, but it is believed that there may be circumstances in which this would be in the interest of the client and of the referring firm. Firms who are interested in having their names placed on the referral panel should apply to:

ANNA HEGARTY at the Law Society Blackhall Place, Dublin, 7.

Adjudication of Leases

SOC I ETY OF Y O U NG SOL ICI TORS

The Joint Committee of the Law Society and Building Societies' Solicitors has considered the practice of requiring the adjudication of the stamp duty on leases on housing estates. It was decided to recommend that hence- forth solicitors for purchasers and lenders should not require the lease of a private house on a housing estate to be adjudicated when it bears what appears to be the appropriate duty. •

SPRING SEMINAR 1984

The Spring Seminar will be held on the 6th-8th April, 1984. Topics will include:— (1) Arbitration (2) Divorce — a comparative study (3) Negotiable Instruments (4) Professional Indemnity and / or Pensions for Solicitors.

Mortgagees' Solicitors and the Borrowers —Conflict of Interest

Increasing attention is being paid to situations in which solicitors may find themselves faced with a conflict of interest. The Conveyancing Committee has recently been asked to advise a firm of solicitors acting for a bank in a provincial town, as to the propriety of their acting for the bank's customers in connection with the completion of mortgage documentation.

Full programme available later.

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