Interest: no obligation to find the best rate possible
Q. I have been acting for an executor, who is also the sole residuary bene-ficiary, in the admini-stration of an estate. The deceased’s tax affairs were quite complex and have taken some time to resolve, as a result of which we have held a reasonable sum of money in a separate designated client account at our bank.
However, the client is now complaining about the amount of interest earned and has suggested that we failed to act in his best interests by shopping around to obtain the best possible rate. Should we have done so?
A. There is no requirement to obtain the best rate of interest. However, rule 25(1) of the Solicitors’ Accounts Rules 1998 states that you must aim to get a reasonable rate of interest on monies held in a separate designated client account and it is not acceptable to look only at the lowest rate of interest obtainable.
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