Solicitors and Limited Liability ?

Delancey

To my knowledge , solicitors never practice as Limited Liability Companies - why is this ?

Our man in Havana

It is most likely prohibited by law.

I found this, http://www.mcgarrsolicitors.ie/2010/03/23/limited-liability/

Generally, the liability of a solicitor (arising out of his/her professional practise) is unlimited. However, under Section 44 of the Civil Law (Miscellaneous Provisions) Act 2008, a solicitor may limit his/her liability to a degree not less than the current minimum sum for which a solicitor must carry insurance for (negligence) claims.

That figure is, currently, €1,500,000.

Arsenal1986

This is something ive been curious about also - why is there no limited liability partnerships like in the states here?

dermot_sheehan

A Company can not hold a practicing cert and therefore can not practice law.

A limited partner can not take an active part in the running of the business (Limited Partnership Act 1907)

Delancey

In otherwords , if you wish to practice as a solicitor you must be prepared to work in an environment of unlimited liability ?
Gee , doesn't seem particularly attractive.

Our man in Havana

Which is the reason insurance is so high.

MagicSean

delancey42 wrote: »

In otherwords , if you wish to practice as a solicitor you must be prepared to work in an environment of unlimited liability ?
Gee , doesn't seem particularly attractive.

That's the choice they make for choosing a high earning potential profession. Aren't doctors in the same boat?

Delancey

k_mac wrote: »

That's the choice they make for choosing a high earning potential profession. Aren't doctors in the same boat?

Fair point indeed , accountants are in the same boat as well I think.

johnnyskeleton

k_mac wrote: »

That's the choice they make for choosing a high earning potential profession. Aren't doctors in the same boat?

I'd almost say it's the other way around - high costs (insurance etc) and risk (personal name becoming mud etc) lead to high fees rather than the high fees leading to the high costs.

If people want cheaper legal fees, the overall cost of doing business for solicitors must be reduced.

maidhc

k_mac wrote: »

That's the choice they make for choosing a high earning potential profession. Aren't doctors in the same boat?

High earning?

In the same boat as doctors?

I wish.

gabhain7 wrote: »

A Company can not hold a practicing cert and therefore can not practice law.

Correct but that is something easily remedied. A practicing cert is nothing but a (very expensive) sheet of coloured A4 paper that entitles you to nothing other than to do what you trained for and is the most dead money any solicitor can spend. Companies can hold liquor licences by various means, and there is no good reason why a company could not practice law if the power that be felt it appropriate.

FreudianSlippers

Haddockman wrote: »

Which is the reason insurance is so high.

What is insurance like for Solicitors? It's really cheap for most barristers.

maidhc

OisinT wrote: »

What is insurance like for Solicitors? It's really cheap for most barristers.

CRIPPLING!

(deserved caps btw)

Sydney2007

CRIPPLING is just the word. As a sole practitioner, I paid €26400 last December for Insurance - still have not recovered, and it seems face the same again in 3 months time. Think I paid around 3,000 for the practising cert, so that's €30,000 for a year's licence. Add in office accommodation costs of €12,000, and another €10,000 at least for ESB, Phone and Rates, Post etc and that's €1,000 per week to open the door. It's another €75,000 to pay the secretarial staff when you add up their take home pay, PRSI,(employer and employee) Levies, pensions etc.etc. So that's €2,500 odd per week that we have to take in before I get anything! And people wonder why legal fees are high! The cost of being available to provide the service is enormous.

Our man in Havana

That is enough to put anyone off practising the law.

MagicSean

What are the rates for legal aid? I presume they are set rates.

johnnyskeleton

k_mac wrote: »

What are the rates for legal aid? I presume they are set rates.

For the district court and other fixed fee matters - http://www.irishstatutebook.ie/2010/en/si/0136.html

Delancey

Sydney2007 wrote: »

CRIPPLING is just the word. As a sole practitioner, I paid €26400 last December for Insurance - still have not recovered, and it seems face the same again in 3 months time. Think I paid around 3,000 for the practising cert, so that's €30,000 for a year's licence. Add in office accommodation costs of €12,000, and another €10,000 at least for ESB, Phone and Rates, Post etc and that's €1,000 per week to open the door. It's another €75,000 to pay the secretarial staff when you add up their take home pay, PRSI,(employer and employee) Levies, pensions etc.etc. So that's €2,500 odd per week that we have to take in before I get anything! And people wonder why legal fees are high! The cost of being available to provide the service is enormous.

Is this insurance you refer to the money paid to the Law Society Compensation Fund or is that a separate and additional payment ?

Sydney2007

The Insurance is Professional Indemnity Insurance, which is mandatory for all solicitors. It is to cover mistakes not fraud. The payment to the Law Society Compensation Fund is to cover fraud, and is included in the Practising Certificate payment of c.€3,000. But between both payments, and all the other business costs, it is nearly impossible to make a living. Personal taxes are so high that the cost of employing secretarial staff at a living wage is a huge cost to a small business. At the end of the day, my business must bring in enough money to pay the Insurance, Practising Cert, accommodation, light, heat, etc.etc. as well as the PAYE/PRSI and some money for the staff to take home with them. It's only at that stage that I get considered. My overheads/operating costs are far in excess of what's left for me.

McCrack

Sydney how long are you a Principal/Partner? What you describe is not unusual for for any sole practitioner the first few years.

Sydney2007

Senior Partner died 9 years ago, and so am a sole practitioner since then. No bother until 2009 - now with the recession, the costs of insurance, wages, levies, taxes, rates, light, heat, etc.etc. are rising rapidly, and are decimating a shrinking practice income. I suspect I am not the only sole practitioner in this position. Hoping to survive another year, and then maybe economy will improve. Suspect, like a lot of other middle aged sole practitioners that there is no alternative, since have no training for anything else, and worked quite well for 28 years, and simply can't shut down a practice overnight.

_JOE_

Sydney2007 wrote: »

Senior Partner died 9 years ago, and so am a sole practitioner since then. No bother until 2009 - now with the recession, the costs of insurance, wages, levies, taxes, rates, light, heat, etc.etc. are rising rapidly, and are decimating a shrinking practice income. I suspect I am not the only sole practitioner in this position. Hoping to survive another year, and then maybe economy will improve. Suspect, like a lot of other middle aged sole practitioners that there is no alternative, since have no training for anything else, and worked quite well for 28 years, and simply can't shut down a practice overnight.

I know only all too well what you are experiencing Sydney2007.

I wish you all the best in this forthcoming year.

Joe