EPR T3 A1 Email and events NSW PDF

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Ethics and Professional Responsibility Task 3 Activity 1

Email and events INDEX Email from Joel Edge......................................................................................................................................... 2 Events occurring during Joel Edge’s absence.................................................................................................... 4 Appendix 1........................................................................................................................................................ 11 Appendix 2........................................................................................................................................................ 12 Appendix 3........................................................................................................................................................ 13 Appendix 4........................................................................................................................................................ 14

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Email from Joel Edge

EMAIL From

:

Joel Edge (Principal)

To

:

You (an employed solicitor)

Cc

:

Alex Green

Subject

:

Arrangements during my weeks leave

I’ll be on leave in Indonesia next week. I’ll get a sim card when I arrive at the airport and let you and Alex know what the number is. Telephone and internet access will be problematic for most of the week as I’ll be in some remote parts of Lombok. Do what you can to help Alex and attend to any queries that might arise. Asher Zheng the manager of our local College Bank branch where our trust and general accounts are kept is very helpful if there is any problem. Alex has his phone number. I’ve appointed you signatory on the office and trust accounts. Just in case you are ill or for any other reason can’t operate the accounts I’ve also appointed my brother Mitchell as signatory to operate both accounts. Some of the things that you will need to attend to while I’m away (there may be others) are listed below. Tina Hudson sale to Li – This matter is scheduled to settle on Friday of next week. It is one of the first electronic conveyancing transactions we have handled so make sure it all goes smoothly. Tina has authorised Edges Solicitors to do anything necessary to complete the electronic conveyancing transaction. Tina’s property at Seabreeze is unencumbered so when settlement takes place the whole of the proceeds of sale will be paid into Tina’s personal bank account rather than into our trust account. Our costs agreement with Tina provides that Tina will pay a fixed fee of $1,800 for our costs and disbursements. I have sent a bill in advance to Tina for $1,800 on account of our costs for this matter. Dino Demarco ats Police (ledger/matter ref 13099) – Demarco’s sentencing following his guilty plea to the charge for supply of methamphetamine is about two months away. I‘ve given him an indication as to the likely sentence which includes a term of imprisonment and a substantial fine. He might want to discuss his situation with you. He still owes Karen Assi, the barrister who we briefed to appear for him at his trial, $1,200. See if you can extract that from him if he comes in. Sprowle v Davis Peaches Pty Limited – This is a claim by our clients Jack and Jill Sprowle for damages for false and misleading conduct under the Australian Consumer Law. We agreed to act and to obtain an advice as to prospects of success. Our clients agreed to pay $2000 for our costs and an estimated $3,500 for a barrister, Mark Richards, to provide his advice. The advice has been received and a copy sent to our clients a few days ago. We also sent our bill of costs as agreed. We have not yet received Mark Richards’ memo of fees. Our clients may well want to discuss the advice with you next week. If they do, please check the trust and office ledgers and the file to establish if Mark Richards’ memo has been received. Jack and Jill are good clients and usually pay our bills immediately. If any amount is outstanding please ask them to settle the account. If Mark Richards’ memo of fees has been received, arrange for that to be paid. Sonal Singh v Taylor Merdec – This is a new matter involving a dispute between our client and her neighbour Taylor Merdec. One of the issues in dispute is the location of the boundary between our client’s property and her neighbour. We are awaiting receipt of a survey report from Ivana Measure. The report is due to be received on Wednesday. In anticipation of its receipt I’ve made an appointment for Sonal to come in to discuss the report with you on Wednesday afternoon. Ivana’s fees were agreed at $800. 5dba0debf3d78f1907cdaa3c07f43270.docx © The College of Law Limited

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Payne and Sanders – proposed purchase of newsagency – As you know, Jim and Valerie made offers to purchase the Seabreeze newsagency but were outbid by another husband and wife team. We advised them on the contract and incorporated a company to be the purchaser. We had money on account and billed them and were fully paid. There remains a balance in trust which they said we should retain as they were still looking for a small business to buy. Jim has just let me know they’ve given up on the idea of buying a business. He will drop in sometime next week to pick up what’s left in trust. Say hello for me.

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Events occurring during Joel Edge’s absence

Events Here are the events that take place during Joel’s absence. You are required to answer the questions in the space provided and submit this document to your lecturer in accordance with the submission requirements. Your answers are expected to refer to the relevant legislation.

Monday Tina Hudson attends the office. She advises she has moved out of her house and the keys have been left with the agent on sale. All is ready for Fridays settlement. She gives you a cheque drawn on her personal account with Westpac for $1800 on account of our costs and disbursements as agreed. Q1 .

(a ) (b )

What should you now do with Tina’s cheque; and Identify all of the accounting records, if any, which are required to be completed upon your receipt of that cheque?

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Tuesday Jack Sprowle arranges to meet with you later that day. You obtain a print out of the trust and general account ledgers in the matter of Sprowle v Davis Peaches Pty Limited as set out at Appendix 1. Q 2

In relation to your bill of costs for $2,000 (the office account ledger indicates the bill was sent 2 days ago) for the initial advice: (a) What action should you take to pay the bill? (b) Identify each book-keeping step you will take to pay the bill, assuming a manual book-keeping system.

You also check the Sprowle v Davis Peaches Pty Limited file, which now includes Mark Richards' memo of fees in the sum of $3,500 which was only received this morning. Q3 Assuming the bill of costs of $2,000 has now been paid, what will you say to Jack in relation to the payment of Mark Richards’ fees?

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Wednesday Dino Demarco attends on you unannounced. He says to you he has sold his car as he will have no use for it if he sentenced to imprisonment. He received over $15,000 for it in cash. He wants you to invest it for him in an interest bearing account pending his sentencing so he’ll be able to pay any fine that may be imposed and any additional costs that might be incurred. He doesn’t want to be able to operate on the account as he knows he’ll only spend it. He wants only you, Joel or someone else from the practice to be able to access the money. After discussion, he gives you the cash together with a written direction to deposit the money in an interest bearing account with Westpac for a 6 month term in the name of Edges Solicitors. He also hands you $1,200 in cash and he asks you to give the cash to Karen Assi with his compliments and apologies for the delay in payment of her fees for appearing on his behalf at the trial. At Appendix 2 are forms for an Edges Solicitors Law Practice Trust Account receipt (X2) and at Appendix 3 is the form of a deposit slip of Edges Solicitors Law Practice Trust Account. Q4 (a)

Identify the types of money you received from Dino today and what you should do with that money and give reasons. (b) Identify the accounting records that are required to be completed and maintained regarding the money received from Dino? (c) What are your reporting obligations, if any, regarding the money received from Dino? (d) If any money is required to be deposited to ‘Edges Solicitors trust bank account’, complete the trust account receipt in Appendix 2 and, in anticipation of banking that money into the trust bank account, complete the deposit slip in Appendix 3. (You are not required to complete receipts in duplicate).

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Thursday Sonal Singh attends her appointment. Ivana Measure’s survey report has been received with her invoice for $800. After discussion Sonal instructs us to send a letter of demand to Taylor Merdec requiring part of a fence between the two properties to be removed. Sonal hands you a cheque drawn on her personal bank account in favour of Ivana Measure for the $800 due. Q5 (a) What should you do with the cheque received from Sonal; and (b) What accounting records, if any, are required to be completed?

Alex Green tells you that Jim Payne and Valerie Sanders have arranged to collect their cheque this afternoon. There is a nil balance in the office account and a copy of the trust ledger in respect of the matter of their proposed purchase of the Seabreeze newsagency is at Appendix 4. Also at Appendix 4 is the trust cheque awaiting your signature. Q6 (a)

Assuming you are authorised to sign trust cheques, or to send that money by way of EFT, should you sign the cheque or authorise the transfer of funds? (b) If the trust cheque is signed and handed to the clients in its present form, identify any consequences.

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Q 7

Assume your first practising certificate was issued to you three months ago; Mitchell has been admitted but has never engaged in legal practice; and Mitchell is not employed in the practice and has no other connection with it. (a) Was Joel entitled to allocate the power to operate the trust and office accounts to both you and his brother, Mitchell, during his absence; (b) Was it appropriate for Joel to have allocated this power to both you and Mitchell?

Friday Tina Hudson’s sale settled this morning. The balance sale proceeds that were paid into the PEXA environment by the purchaser of Tina’s house, was disbursed directly into Tina’s personal bank account by PEXA in accordance with our direction. Previously, Tina provided written instructions authorising the payment of our costs and disbursements from the money held in trust on her behalf Q 8

Even though Tina has authorised payment, before Tina’s trust money can be withdrawn and transferred to the office account to pay the bill of costs, what must you now consider following the banking of the trust money?

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Q 9

(a Identify the type of money that represented the balance sale proceeds as a result of ) Tina’s authority to Edges Solicitors to do anything necessary to complete the econveyance on her behalf. (b Identify the accounting records required to be completed and maintained regarding ) the balance sale proceeds?

Late in the afternoon Alex informs you that she has written up the trust account and discovered a small debit balance in the ledger account for the matter of Lau v Cousteau Limited. She says this personal injury matter settled recently and the proceeds of settlement received into trust. Included in the payments to be made out of the settlement was a payment to Paul Rakoi, an expert witness in the proceedings. His fees were $2,030.50 but by oversight the cheque drawn to him was for $2,035.00. She says Joel was in a huge hurry just before he left on leave and made a simple mistake. She also says the error would not have happened if the practice had trust and office accounting software and it’s time the practice moved on from using antiquated hand written accounts. Alex has checked with Asher Zheng and unfortunately the cheque has been presented and paid. Q1 (a 0 ) (b ) (c )

What should you do about the deficiency which has occurred in the trust account? Do you have any reporting obligations? If the practice had trust and office accounting software, would that have made it less likely for a debit balance to have arisen? Give reasons, if appropriate.

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Appendix 1

Appendix 1 Trust Account Ledger ACCOUNT NAME: ADDRESS: MATTER: DATE 20XX

(Four months ago)

RECEIVED FROM OR PAID TO

Fr J. Sprowle

Sprowle, Jack and Jill v Davis Peaches Pty Limited 6/6 Conclave Avenue, Seaside Damages claim in Federal Court

PURPOSE

On a/c c/d – initial advice

REC/CH Q/ JNL NO.

CR

DR/C R

BAL

2,500 00

CR

2,500 00

DR/C R

BAL

DR

2,000 00

DR

R231

Office Account Ledger ACCOUNT NAME: ADDRESS: MATTER: DATE 20XX

RECEIVED FROM OR PAID TO

(Two days ago)

5dba0debf3d78f1907cdaa3c07f43270.docx © The College of Law Limited

Sprowle, Jack and Jill v Davis Peaches Pty Limited 6/6 Conclave Avenue, Seaside Damages claim in Federal Court

PURPOSE

Costs rendered – advice re prospects of success

REC/CH Q/ JNL NO.

CJ213

DR

2,000

CR

00

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Appendix 2

Appendix 2 EDGES SOLICITORS PO Box 2 Your capital City ABN 62 751 281 333

118201 20xx

Received from the sum of dollars and cent s

Cash :

For and on behalf of (client name)

(matter description)

For:

Ledger Account / Matter Reference # Received by: on behalf of: Edges Solicitors Law Practice Trust Account

EDGES SOLICITORS PO Box 2 Your capital City ABN 62 751 281 333

118202 20xx

Received from the sum of dollars and cents

Cheque/Cash

$ :

For and on behalf of (client name)

(matter description)

For:

Ledger Account / Matter Reference # Received by: on behalf of: Edges Solicitors Law Practice Trust Account

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Appendix 3

Appendix 3 Trust Account Deposit Slip COLLEGE BANK

20xx

THE SUM OF

NOTES COIN

TELLER

COMM

NO. ITEMS

(signature)

CHEQUES as herein

TRUST ACCOUNT

TOTAL

PAID IN BY

FOR CREDIT Edges Solicitors Law Practice OF 123 456 789 Account No

$

Proceeds of Cheques etc. will not be available until cleared

PARTICULARS OF CHEQUES, ETC. DRAWER

BANK

PLACE

AMOUNT

1. 2. 3. 4. 5.

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Appendix 4

Appendix 4 Trust Account Ledger ACCOUNT NAME: ADDRESS: ACCOUNT NUMBER/ MATTER REFERENCE: DATE 20XX

J. Payne and V.Sanders purchase of Seabreeze newsagency 10 Amy Street Seabreeze 2022/XX

RECEIVED FROM OR PAID TO

(Three Fr Payne & Sanders months ago) (Two months To ASIC ago) Two months to Edges Office account ago)

COLLEGE BANK Date Payee

REC/CHQ / JNL NO.

PURPOSE

DR

CR

DR/CR

BAL

CR

5,000 00

On a/c c/d

R231

5,000 00

Incorporation fees

C231

545 00

CR

4,455 00

For costs

C233

2,455 00

CR

2,000 00

46333

COLLEGE BANK

(today)

(today) J. Payne & V. Sanders

A/c 2022/XX

Pay

or bearer

J. Payne & V. Sanders

the sum of Two thousand four hundred and fifty five dollars — $

moneys held in trust on completion of matter Chq $ 2455.00

EDGES SOLICITORS Law Practice

46333

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TRUST ACCOUNT

2,455.00

egotiableNot

Detail refund of balance of

“•46333 ‘•082’”000•’123’456789”•

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