Money sent in error being spent without consent?

Lbuk

Hi. I am purchasing a house and the exchange required a lot of money to be transferred to the conveyancer for Monday.

I went to the bank and it was all a bit of a farse and they couldn't do the transfer at the time and would notify me if that changed.

I had to get the money across so made a maximum transfers each day over the weekend to meet the deadline.

Monday arrived and guess what? The bank had also made the transfer without notice so my conveyancer had double my money. The exchange went ahead, the bank was covering the costs to have the money transferred back so it all seemed to be working our in the end.

Then the conveyancer said that they would be deducting some invoices from the amount before returning it.

I said that it was not appropriate and they should return the full amount sent in error and then invoice me for monies due. I had always paid monies promptly when requested and reminded them that they had stated no further action was needed on my part regarding their disbursement invoice until settlement.

The response was that they would not return the money sent in error until I transferred them the amount they were requesting - we're talking a comparatively very small amount of money.

So, that is what I did. I paid the invoice and expect the funds sent in error back asap but I'm livid about the whole thing. It's really soured what had been quite an amicable process.

Can anyone clarify if the conveyancer was acting legally and/or ethically in taking opportunity from the money that I sent them in error?

Jenni_D

IANAL but it sounds like they were holding the overpayment hostage vs their invoice, without affording you the opportunity to dispute any aspect of their invoice.

But in the grand scheme of things, is any further action worth the time and effort?

Ditzy_Mitzy

It's an odd one, in that the conveyancer has created a lien in relation to the capital sum.  Such an agreement, holding on to an item of a debtor's as collateral, is perfectly legal.  I'm really not sure whether this being cash rather than, say, jewellery makes any difference.  
The conveyancer's actions were, in my opinion, slightly odd.  If I had been them, I'd simply have deducted my fees from the monies incorrectly transmitted, which is perfectly fine, and returned the balance without reference to you.  You mention not wanting to do that, which is possibly the cause of some of the confusion.  
Is there a breach of client money rules?  Possibly, but it's technical in nature.  As @Jenni_D pointed out, there really doesn't seem to be any point in pursuing this.  

TripleH

Assuming I have understood correctly the Op's post I think the conveyancer have acted inappropriately here. The money transferred across should have been to a client account to be utilised as instructed by the client.

Op  if you never intend to use the firm again, I would raise a formal complaint about mismanagement of client money.

Whilst you have not incurred a loss here, refusing to transfer funds according to the wiishes of the client I believe is quite serious and I'd they have put in writing their refusal, I would include that in your complaint. The funds held in their client account should be treated as a completely separate matter to any money owed to the firm.

Jenni_D

Gladstones Solicitors were recently fined £30k (?) by the SRA for improper handling of client account funds. (In their case they had poor payment management in respect of parking charge notices and ended up with a significant sum in their account that they couldn't attribute to PCNs that victims consumers had paid).

Chris_English

This does sound like improper handling / segregation of client money.

I’d email making that point, and explaining that I expected to be invoiced as per usual, not have client funds dipped in to.

Is there a history here about bills going unpaid, or being paid late?

Jenni_D

Chris_English said:

Is there a history here about bills going unpaid, or being paid late?

It would seem not:

Lbuk said:

I had always paid monies promptly when requested and reminded them that they had stated no further action was needed on my part regarding their disbursement invoice until settlement.

nyermen

For my conveyencing a few years ago, there were certain incidentals due before exchange (searches etc), but the main fees were requested at completion (and indeed, I recall paying into a separate account to the client account). 

Think i'd have been a little unimpressed if my bank transferred funds twice before exchange, and they said "ah we'll just keep some of that for later thanks".  In my case there was a month between exchange and completion, unclear of the timescale here.

To add - My conveyancer was also acting for the bank (on their approved list).  I suspect if they'd not returned the funds to the bank in full, they may well have found their position on that list under review (assuming that the mistake was the banks on the second transfer)

Jenni_D

In this case it wasn't the bank who transferred twice - the OP did the transfer initially (in multiple transactions) because the bank said they couldn't do it in time (but then went and did it anyway). But I agree with the thrust of what you say.  

nyermen

Agreed, just thinking on the second transfer, if they said they couldn't do it in time, was the transfer order submitted anyway by accident (bank) or never recinded (OP).

But in any case, it seems that the solicitors were a bit brash if not naughty.  OP could complain, or leave a truthful review or both I guess.

unholyangel

There's been no indication that the funds aren't being held in a separate client account. 


And what everyone seems to be overlooking is the right to set off one debt against another. But that depends on particulars. They wouldn't technically have any claim to offset until their fees actually became due (or perhaps if, by the time they processed the refund, the sums would have been due).