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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3493
Experience:  Solicitors 2 years plus PQE
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I have a client who owed me fees, but also works on projects

Customer Question

Hi,
I have a client who owed me fees, but also works on projects for me. They owed me a considerable amount in fees and was due to complete on a transaction which i provided input / worked on, so I was due paymnet . The fee was agreed to be paid by the client and the payment was to be made by his lawyers, on his behalf. The Lawyers undertake to pay in 90 days as they would have access to the funds. They are one of the largest Law firms in the UK.
They confirmed that the fees were held in escrow and would be available in 6 - 8 weeks, well before the 90 days. They undertook to pay them within that period, on or before 90 days. I was told to present the invoice to the Law firm with the 90 day term, which they would pay on or before . The client gave irrevocable instructions for the law firm to pay the invoice on or before the due date , if they did not have the funds they were given irrovcable instructions and authority to draw on the funds held in escrow to meet the invoice. when asked by their client did they (The Law Firm) understand the instructions given by him, the client, they replied yes, they had "received and understood the instructions given".
90 Days later the client has run off and there is no money . The solicitor says it is not their responsibility and even though the invoice was made to them and they accepted it , to be paid in 90 days , they are not responsible . as their client has run off and the money which they told me was in escrow and they would have access to has gone or may never have been there in the first place.
Where do i stand - I assumed that the lawyers had agreed to meet the invoice in 90 days and they had led me to believe there was money in escrow to meet payment - now there is mumblings that there was never any money ?
Where do i stand, this sounds like deception and the solicitors have covered for their client
Submitted: 26 days ago.
Category: Law
Expert:  Aston Lawyer replied 26 days ago.

Hi, thanks for your enquiry. Could you please let me have the wording of the Solicitors Undertaking to you? (Am I correct in thinking that they gave you the Undertaking?) Kind Regards Al

Customer: replied 26 days ago.
I will send you the email exchangeHere it is ; first sent this ,1;The Lawyer:
______
GaryFurther to Rob’s email:1. We confirm that we have seen confirmation from the solicitors acting on the sale of the property for which Rob is receiving fees that £1.2 million is held in escrow for him and that it is expected to take 8 to 10 weeks from 14 July 2016 for those funds to be paid to Rob.
2. Please accept this email as this firm’s undertaking that, following receipt of £1.2million in respect of this matter from the client account of the solicitors acting on the sale of the property, we will pay you £160,000 plus VAT out of those monies. We also confirm that Rob has irrevocably instructed us to make this payment. Finally, this undertaking is conditional upon receipt of bank account details from you confirming where the payment should be made. Please send them to me.Regards
______________________________________________________________Now given that I, told the client it must be paid in 90 days , The client in turn said to the his lawyer, It must be paid in 90 days or before and he would give them full authority on the escrow account .. this was the next exchange ....2: The Client:
____________________
Gary,As per our agreement please raise an invoice addressed to me. Please copy in Ben and subject to the invoice being as agreed I will re confirm my irrevocable instructions to Ben attaching a copy of the invoice.Could you please include the bank account details on your invoice as to where the funds should be remitted from IM XXXXX.3: Me to the Client & Lawyer
___________________________RobPlease find attached the invoice as discussed. Please can you confirm that the invoice is;Due, Undisputed and the amount is correct. And that you will give irrevocable instructions to your lawyers to pay the invoice within the 90 days OR earlier.Rgds
4: Client to me and his Lawyer:
_________________________________
Gary,Thank you very much for the attached invoice. I can agree the invoice as attached.I herewith give irrevocable instructions to Irwin Mitchell to pay this invoice from the funds held in escrow relating from the transaction which occurred connected to Villa San Carlo Borromeo.I further herewith give Irwin Mitchell authority to draw down from the funds held in escrow on or before the 90 days to pay this invoice on my behalf.I can also confirm that the amount is due, undisputed and the amount is correct. I also note the bank accounts on this invoice and herewith give Irwin Mitchell authority to remit the payment to this account.Ben could you please confirm you have received and understood my irrevocable instructions.Kind regardsRob5 : Lawyer to me and his Client
_________________________________
RobThanks for your email. I have received and understood your instructions.RegardsPartner
Irwin Mitchell LLP
Expert:  Alex J. replied 25 days ago.

Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. You were given a solicitors undertaking to pay the sum of £160,000 plus VAT - did the solicitor ever receive the £1.2million. If so then you potentially have a claim against the solicitor directly. I look forward to hearing from you. Kind regards AJ

Customer: replied 25 days ago.
Hi, no they claimed they never received the money, and the money that they said was in escrow was never there, even though the stated it was there and would be available within 8 - 10 weeks from the 14 July 2016, well within the 90 day term. On this basis they accepted the clients instructions to pay the invoice on 90 days.
Expert:  Alex J. replied 24 days ago.

Thank you. A solicitors undertake in this type of circumstance is like a professional bond. If they do not honour the undertaking or in fact they have openly lied to you this is a serious conduct issue. There are really two ways you can deal with this - (1) you can try and sue the solicitors and/or (2) make a professional complaint against them. Was the undertaking given to you directly or to another solicitor? Kind regards AJ

Customer: replied 24 days ago.
Hi, So the solicitor that i had asked the question to (solicitor 1, acting for the client Rob) was told by another solicitor (solicitor 2, holding the money in escrow) that the money was there, held in escrow and would be available in 8 - 10 weeks, solicitor 1 never checked if solicitor 2 was actually telling the truth . They simply passed the info on to me and said they would pay in 90 days as their client had given them irrevocable instructions to pay the invoice, the key here is that when they were asked did they understand the instructions they stated yes the instructions were understood, that they had to pay the invoice within 90 days. They should have said No we can't understand your instructions, because we need to ensure the money is there first and that it exists, i naturally assumed the funds were within their control. The flow of email exchange is detailed above. the issue is; they say they could not draw down on the funds as there was nothing there to draw down and pay from. It looks like solicitor 2 was rather shady and solicitor 1 never checked that the money really existed, solicitor 1 simply told me it would be there in 8 - 10 weeks and it would be transferred from escrow and then paid to me . There was no money .
Expert:  Alex J. replied 23 days ago.

Hi, Thank you. Just to clarify did your solicitor say they had verified that the other solicitor was holding funds? Do you have this in writing from your solicitor?

Customer: replied 23 days ago.
Sorry let me clarify, my solicitor was not involved. The undertaking was given to me by the client's solicitor, the person who owed me money. The clients solicitor confirmed that there was funds held in escrow. however we have discovered that this was a fake letter from the client or a rather shady firm of solicitors. The Solicitor who gave the undertaking did not verify the fuss were real . He simply told me they were there;See below email transcript ;Further to Rob’s email:1. We confirm that we have seen confirmation from the solicitors acting on the sale of the property for which Rob is receiving fees that £1.2 million is held in escrow for him and that it is expected to take 8 to 10 weeks from 14 July 2016 for those funds to be paid to Rob.
2. Please accept this email as this firm’s undertaking that, following receipt of £1.2million in respect of this matter from the client account of the solicitors acting on the sale of the property, we will pay you £160,000 plus VAT out of those monies. We also confirm that Rob has irrevocably instructed us to make this payment. Finally, this undertaking is conditional upon receipt of bank account details from you confirming where the payment should be made. Please send them to me.Regards
______________________________________________________The reality was there was never any money held in escrow.
Expert:  Alex J. replied 20 days ago.

Thank you. Do you think then the other party forged the letter from the solicitor? The bot***** *****ne is if the solicitor gave you an undertaking and lied to you, you can make a claim against the solicitors insurance. Are you in direct contact with the solicitors? Kind regards AJ

Customer: replied 20 days ago.
Thanks for responding, the letter appears to be be either forged or from a suspect firm, either away there was no funds to meet the invoice i was led to believe would be paid. My point is that the solicitor who represented the shady client, knew that i was going to act on the information he gave. He knew i was relying on him confirming the funds were available and real so that i could raise the invoice and forward finance his client further. I am now at a loss as i factored the invoice and there is no one to pay - the funds do not exist . The key here is i have suffered serious loss as a result of information i relied upon from the clients lawyer. The fact is he - the clients lawyer - never checked the existence of funds or whether the letter was intact real - the funds never existed never existed , if anything it strikes me as negligence , but i am told they owe me no duty of care as they don't act for me , only their client and they relied on the information supplied in good faith !
Customer: replied 19 days ago.
Simple Question,1; Does the client solicitor have any liability given that;a, They supplied me information that was false, although they claimed it was supplied to them by their client and they simply relied on it in good faith and in turn supplied the confirmation to me, without checking.b; They knew i was going to rely on the information they supplied in order to make a commercial decision, based on the understanding that the client had access to money in escrow and he would give his lawyers that access to fulfil the undertaking.c: The lawyers giving the undertaking never checked the existexistance of funds, their client claimed to have, they simply told me there was money based on suspect information provided by their client (in the form of a forged solicitors letter showing funds held in escrow)d; I have suffered a serious commercial loss as a result of acting on the information supplied by the firm of lawyers who provided me with the undertaking and confirmation of the existence of funds. They never checked whether the funds or the escrow account was real.Simple question;Are they liable for my loss, given the above summary, if so what case or legal argument can support my claim ?Or do they simply have no duty of care to me, as they claim, and can tell me whatever they are instructed to by their client ?If this is the latter answer ... Then everyone can be rich overnight with this type of fraud - Nigerian 419 Fraud .. will not be a patch on this then !!I hope to god its the former , not only for my sake !
Customer: replied 19 days ago.
Ok So this has massive parallels with Dean v Allin & Watts (2001)So can some shed some light - or is this one too difficult ?
Expert:  Alex J. replied 18 days ago.

Thank you. My apologies for the delay, I am review your response now I will revert to you shortly. Kind regards AJ

Customer: replied 16 days ago.
hi .. is there any suggestions ?
Expert:  Alex J. replied 15 days ago.

Hi, Thank you.

To answer each question in turn:

a. If they provided you information that they knew to be false and you relied on this to your detriment, then you may well have a claim against, especially if you suffered loss as a result. This in itself is not sufficient to prove fraud though.

b. The undertaking was conditional upon them receiving the money, therefore if they lied to you about actually receiving, or were negligent in checking whether the money was there, this could be a breach of the undertaking;

c. Did the solicitors provide you with a copy of the escrow letter?

d. Proving you suffered a loss as a result of their actions is key to any claim - so this is certainly a first hurdle you need to over come.

So to establish your claim, has the solicitor confirmed in writing that i) never received the money and ii) that it did not see the escrow letter? Did you ever see the escrow letter?

Customer: replied 15 days ago.
A: Ok, So they will claim they saw the Escrow Letter and acted in good faith, however they should have checked the authenticity of the document and its contents, particularly knowing i would rely upon their confirmation.B: Or were negligent in checking whether the money was there, this could be a breach of the undertaking; yes this is certainly the case where they never checked - I am Certain the money was never there , The partner in his panic, when i demanded payment, confirmed there was no money, there never was . They never checked before giving the undertaking to me.C:No copy of the Letter was ever provided to meSo they confirmed;i) they never received the money, purely because it never existed - forged solicitors letter, or shady solicitor who wrote it - but they never validated authenticity!ii) They say they saw the Escrow Letteriii) I never saw the escrow letter

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