Lawyers should not act for two sides in property deals - report finds

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A Law Society task force has decided that solicitors should not be permitted to act for both sides in a property transaction, except in limited circumstances provided for in law. . Its report will be discussed by the council of the society next Friday.

The prohibition should extend to voluntary transactions between, for example, family members where a parent signs a home over to a child, the task force concluded. These are permitted in many jurisdictions. The task force was set up in light of concerns over the same solicitor acting for both purchaser and vendor in conveyancing transactions. The practice was also the subject of a number of complaints to the Law Society.

The task force examined the practice in a large number of other jurisdictions, in the common and civil law traditions. This confirmed every other common law jurisdiction, and most civil law ones, had a prohibition on the same solicitor acting for both sides in a property transaction.

Many of these jurisdictions permitted a range of exceptions, but the task force concluded most such exceptions were unjustified.

On the issue of voluntary transfers of property, usually between family members, the task force said the case for the continuation of allowing one lawyer to act for both sides was undermined by a survey by the Health Service Executive and UCD which found 94 per cent of financial abuse of the elderly in Ireland was perpetrated by family members. Example s of financial abuse include forcing or misleading  an elderly relative   in to signing over their interest in the family home.

The task force did not see how one legal adviser could give independent or impartial advice to donors and their donees.

It recommended that in the case of voluntary transfers and transfers below market value there should be a total prohibition on solicitors acting for both sides.

On transfers for market value, the task force noted there had been adverse judicial comment on the lack of a Law Society prohibition on one lawyer acting for both sides. There should be a prohibition in such cases, it stated, except where both parties were associated companies or were “qualified parties” under EU regulations.

Brophy Solicitors

09.07.12