CH11- Legal matters associated with documents, electronic data and records

Question 1

Retention of records and time limits for court action

Answer 1

English and Welsh law
Document retention policy should be outlined in letter of engagement

Member should consider:
Data protection rules
Periods of retention required by law
Periods within which a court action could be brought
Period of time for which information in working papers may be needed for compiling tax returns

Question 2

Requests from other 3rd parties

Answer 2

If member receives request for information from 3rd party, obtain clients permission or ensure request is legally enforceable
If 3rd party exercising legal or regulatory right, need to ensure that right is being correctly exercised- may not extend to certain documents

Question 3

End of retention period

Answer 3

Records which are legal property of the client should be returned or destructed if permission given
If deletion of records outsourced, obtain certificate of deletion from 3rd party

Question 4

Right of lien

Answer 4

Lien= legal right to retain possession of a property until a financial claim that the holder of the property has against its owner has been met

Question 5

Before exercising right of lien

Answer 5

Consider:
Whether all steps have been taken to remove any genuine sense of grievance on the clients part as to the amount of the bill
Whether potential loss of goodwill outweighs financial consideration
Whether to take specialist legal advice or recommend the client to take specialist legal advice

Question 6

Lien cannot exist over

Answer 6

Documents of a company which have to be available for public inspection or must be kept at company’s registered office
Company’s accounting records
VAT records of any business (excluding photocopies)

Question 7

Conditions for lien to exist

Answer 7

Not enforceable against liquidator, administrator, trustee in bankruptcy or official receiver
It is enforceable against administrative receive or supervisor of IVA/CVA
May need to take legal advice in connection with ownership of documents

Question 8

Drafting legal documents

Answer 8

Certain legal documents may only be drafted by qualified people- reserved legal activities
e.g.
Transfer of real property
Drafting any other document relating to real or personal property including contract, conveyance and mortgage in a land transaction
Preparing instruments relating to legal proceedings
Drafting a trust deed for fee, gain or reward

Non qualified persons could be fined or imprisoned
Member can suggest amendments to a legal document
Specialist legal advice may be needed and members should only take on work they are competent to perform

Question 9

Data protection

Answer 9

Must comply with data protection responsibilities:
Obtaining documented instructions from any data controller on whose behalf member is processing data
Records kept of all processing activity
Identify and document basis under which processing data
Observation of all relevant reporting requirements
Putting in place correct procedures to deal with clients rights
Secure and confidential data storage and cyber security measures
No use of personal data for marketing purposes without consent
Issue of appropriate privacy notices to clients

Question 10

Legal professional privilege

Answer 10

A COMMON law privilege which protects communications between a professional legal adviser and their client