‘Forget about clients’ money’

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‘Forget about clients’ money’

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That was my father’s first piece of advice for me after I started practice. He gave that advice to every pupil that went through his firm. I don’t know whether he still does it anymore.

“Bank it in, note when to pay it out, then forget about it. Those that keep looking at it or thinking about it are the ones that get into trouble. Even if you go bankrupt, or your family is starving, you cannot touch that money.”

For a long time I understood his advice. In theory, though. I say, in theory, because for a long time I was a mere legal assistant in my father’s firm. I never made partner; never had to manage the client account; never had to entertain clients; never felt the weight of aggregated client monies in an account with my name on it. “Clients’ money” was a theoretical construct. But I understood money, and I understood what money did to people. Money warps people’s perceptions. Money arouses greed, it tempts; money seduces. Especially, other people’s money.

“Some of these lawyers think they can use the clients’ money quickly and then have it back before they have to pay it out. It’s a gamble. Not a gamble you want to take. You want to gamble you go to the casino. Why do you think banks don’t often want to take on a sole proprietorship? They are scared some of these fly by night fellas get on their panel, get a big loan, pack up and cabut with the money.”

See this, where in 2014 Herlina Khamisiah Sauli pleaded guilty to misusing RM 418,500 of her client’s money that was supposed to be proceeds from the sale of a house and misusing a further RM 261,000 clients’ money in a separate criminal proceeding. See Singapore, where a “veteran lawyer” Ooi Oon Tat in 2019 was suspended for a year for banking in S$138,148 into his office account instead of his client account.

Now, I run my own firm. Now, I understand his advice, in experience. Now I hold other people’s money either pending the completion of a property sale or a judgment sum pending an appeal. And, oh boy, there is a lot of money; thankfully, I do not have to hold those monies for long. My policy is to pay out the moment the triggering event happens. Why hold someone else’s money the moment longer than you have to?

The client is usually fully aware when they are supposed to receive money. When they don’t receive it when they expect to, they get anxious, nervous and suspicious. Latent or freshly minted suspicions about the trustworthiness of their lawyer materialize like a hidden ghost that reveals itself. The client’s fevered fearful fits will project fanciful fraudulent intentions on you where none exist.

The best way to assure a client is to pay them when you are supposed to. Not before, because you maybe liable for breaching an undertaking; but not a day after, for you will make the client anxious and suspicious.

If there is going to be a delay, inform your client the moment that becomes a likelihood and tell them what you are doing about it and when they can expect to receive the money.

Since setting up on my own, I implement my father’s advice scrupulously. Using client’s money is not the type of temptation you get rid of in the Wildean manner by yielding to it. This is the type of temptation one resists by forgetting about it until the time arrives to relieve one’s self of that responsibility.

In a world where we are constantly told that personal contentment is found by acquisition and accumulation, there is a subtle pleasure and relief in being able to deliberately forget some things, even if it is for only a little while.

2 thoughts on “‘Forget about clients’ money’”

  1. Such a great piece of advice (and writing of course!) Can’t help but to share the fact that the first time I ever got to use the cheque deposit machine was during my internship with you! 🙂

    Reply

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