Q&A corner

Q. I’ve heard that the banks are introducing a new cheque clearing system. When will this happen and how will things change?

A. The new system is going to be phased in gradually across banks and building societies from the end of October 2017. The changes mean that cheque images will be transmitted securely between banks within the UK, which will significantly reduce the time it takes for them to clear. Under the new system, solicitors will get access to funds more quickly; however funds will also leave the account faster. The time taken to clear cheques will reduce from six weekdays to the next weekday.

We have been told that it will still be possible to stop a cheque but you will have less time to do so.

Cheques paid in via the Post Office or in remote branches will take up to two additional weekdays to clear, as they do now.

Q. I would be grateful for your guidance on an executry matter. I am the sole executor. The deceased left his modest estate to a charity. With regard to my terms of engagement letter, do I require to issue this to the charitable beneficiary?

A. At one point there was some confusion on whether or not a beneficiary should be sent a terms of engagement letter. This has now been clarified.

The beneficiary (the charity) is not the client of the firm and therefore we do not think it necessary to issue it with your full terms of business.

However, you should send some information, in particular a statement of the basis on which fees will be calculated and charged for the administration of the estate.

More details can be found in the Rules and Guidance section of the Society’s website, under Section F, Division I.

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