Reference is made to the provisions of section 50(1) of The Legal Profession Act respecting interest on trust deposits and more specifically to the exceptions outlined in subsection 50(1).
Where a member holds or receives monies for or on account of a client upon which, having regard to all of the circumstances, (including the amount and the length of time for which the money can reasonably be anticipated to be held) a client should be entitled to receive interest on such monies, the member should obtain written instructions from the client and deposit the monies in a separate interest-bearing account and must account to the client for all interest earned on it.
A “specific trust investment account” is defined as follows:
“specific trust investment account means a separate interest-bearing account opened by a member in trust for a specific client at a savings institution, and is limited to a daily interest savings account, a term deposit or a guaranteed investment certificate.”
Each situation will depend on its particular circumstances but the member should consider the cost to the client as a factor in determining the reasonableness of an investment. Depending on the circumstances of each situation, it may be considered unacceptable practice by a member of the society to fail to make arrangements with his client so that interest will be earned by the client on monies held by the solicitor for that client.
[Updated as to Act and section references, June 2017]
The Law Society of Manitoba
200 – 260 St. Mary Ave.
Winnipeg, Manitoba, R3C 0M6