Page 276 - IOM Law Society Rules Book

ADVOCATES ACCOUNTS RULES 2008

Notes
(i) “Private loan” means a loan other than one provided by an institution which provides
loans on standard terms in the normal course of its activities – rule 30(2) does not
apply to loans made by an institutional lender. See also practice rule 7, which prohibits
an advocate from acting for both lender and borrower where there is a conflict between
the interests of the clients.
(ii) If the loan is to be made by (or to) joint clients, the consent of each client must be
obtained.

Rule 31 – Recognised bodies

(1) If an advocate’s partnership owns a recognised body, the partnership and the recognised
body must not operate shared client accounts, but may:

(a) use one set of accounting records for money held, received or paid by the
partnership and the recognised body; and/or

(b) deliver a single accountant’s report for both the partnership and the recognised
body.

(2) If a recognised body as nominee receives a dividend cheque made out to the recognised
body, and forwards the cheque, either endorsed or subject to equivalent instructions, to the
share-owner’s bank or building society, etc., the recognised body will have received (and
paid) controlled trust money. One way of complying with rule 32 (accounting records) is to
keep a copy of the letter to the share-owner’s bank or building society, etc., on the file, and, in
accordance with rule 32(14), to keep another copy in a central book of such letters. (See also
rule 32(9)(f) (retention of records for six years).)

Note
Rule 31(1) applies equally to a recognised body owned by a sole practitioner, or by a
partnership, or indeed by another recognised body. If a recognised body holds or receives
money as executor, trustee or nominee, it is a controlled trustee.

Rule 32 – Accounting records for client accounts, etc.

Accounting records which must be kept

(1) An advocate must at all times keep accounting records properly written up to show an
advocate’s dealings with:

(a) client money received, held or paid by an advocate; including client money held
outside a client account under rule 16(1)(a);

(b) controlled trust money received, held or paid by the advocate, including
controlled trust money held under rule 18(c) in accordance with the trustee’s
powers in an account which is not a client account; and

(c) any office money relating to any client matter, or to any controlled trust matter.

Rule 32 – Accounting records for client accounts, etc. page 33