A solicitor is representing a client who owns a leasehold property and is in negotiations with the freeholder for a lease extension. The solicitor makes a promise to pay the freeholder's legal fees in correspondence with the freeholder's solicitor, which the freeholder reasonably relies on. However, the client later refuses to provide the solicitor with the necessary funds to make this payment.
Does the solicitor have a duty to make the payment under the SRA Standards and Regulations in this situation?
A solicitor is representing a client who owns a leasehold property and is in negotiations with the freeholder for a lease extension. The solicitor makes a promise to pay the freeholder's legal fees in correspondence with the freeholder's solicitor, which the freeholder reasonably relies on. However, the client later refuses to provide the solicitor with the necessary funds to make this payment.
Does the solicitor have a duty to make the payment under the SRA Standards and Regulations in this situation?
Yes, because the promise is an undertaking to make the payment and is binding on the solicitor.
(C) The SRA Code of Conduct states that a solicitor must fulfil all promises they make within the agreed timeframe or within a reasonable time if no such timeframe was agreed upon. In this specific scenario, the solicitor provided an undertaking to the freeholder's solicitor and is legally bound to fulfil it, even if they have not received the necessary funds from their own client.
Option (A) is incorrect because it carries regulatory implications.
Option (B) is incorrect because the solicitor has already provided an undertaking and is obligated to fulfil it. In such a case, the solicitor should have requested their client to provide them with the necessary funds before making any promises.
Option (D) is incorrect because an undertaking can be legally binding even if it is not in writing.
Option (E) is incorrect because the solicitor, not the client, provided the undertaking to the freeholder's solicitor. Therefore, the undertaking is a matter between the two solicitors.