ILLEGAL PRACTICE.

Hawera Star, Volume XLVIII, 28 November 1924, Page 8

ILLEGAL PRACTICE.

PROCURATION FEES. QUESTIONS CONCERNING. LOANS. PREIMIER REPLIES. Recently ia iset of questions affeetnig the Jr’uiblic Trust, Guide was put to uiie i'rime Minister, Mr. Massey has considered the questions and announced his answers. ,' , The questions were: (t.J Whether he is aware that many solicitors and other persons putting in applications to the Public Trust - Office for loans' on behalf of clients charge a procuration fee for obtaining a loan? (2.) Whether he will take steps to stop the practice, seeing that under the. Public 'Trust Office Amendment Act, 1921-22, it was made illegal? 1 (3.) Whether arrangements could not be made for applicants for loans to have their application s prepared by an agent of the Public Trustee, or in any ottice of the Public Trustee, and their securities prepared by the Puiblic Trust Office ? (4.) Whether he will take steps to limit the (solicitors’, costs in connection with, these loans to the proper legal charges for preparing new securities, and' have the system of charging procuration fees stopped, thereby relieving the farming community and others of this* unnecessary burden? Mr. Massey’s answers are: (1) The Government is not aw^re that any solicitors or other persons putting in application to theVPublie Trust Office for loans on behalf of clients are charging procuration fees for obtaining the loans. The Government was under the impression that the practice had been discontinued, especially since the. recent remarks of a judge of the Supreme Court in. Auckland condemning the practice generally. ‘ ■ (2) Having by section 100 of, the Public Trust Office Amendment Act, 1921-22, made the practice illegal, the Government will take all possible steps to deal with any cases which are brought under notice. (3) In any case where an applicant submits an iupolioaition for a loan to a b aneh of the Public Trust Office without the intervention of any solicitor the application is prepared by the officer, and if no solicitor is nominated for the purpose the security is prepared by the Public Trust Office. In the circumstances it does not appear that any further arrangements are required to be made in the direction of having securities prepared by the Public Trustee. (4) With regard to the limitation of solicitors’ costs to tbe proper legal charges, the Public Trustee does not wish to interfere between clients and their solicitors, but if any eases are brought under notice of procuration fees having been charged, the PublicTrustee will take all necessary action to obtain .a refund on behalf of the client against whom the fees have been , charged. The Trustee states that he had endeavoured to eliminate the necessity for solicitors charging procuration fees by allowing practitioners submitting loans a. fair rate of remuneration for the preparation of the necessary securities. Solicitors are allowed to charge according to the recognised scale prescribed by tbe Law Society for such work. Moreover, a' solicitor in furnishing his certificate is required to certify that he lias made no charge beyond that prescribed by such scale. The Public Trustee feels that he has done all be- can legitimately do to stop the practice complained of; but, as already stated, if any such cases are brought under his notice he will take the necessary action. But so long as solicitors observe tbe recognised practice and act fairly towards their clients the Public: Trustee does not desire to disturb the relations, existing between them and their clients with tbe obiect of diverting work to the Public- Trust Office. (5) It may be taken, therefore, that the practice of charging procuration fees is by ■no means a general one, but there may be isolated cases, anti it is considered that everything possible lias been done in the matter by (a) the .mssing of leviV-altion making the practice of charging such fees illegal, (io) bv tbe Trustee allowing a solicitor acting on behalf of a client a fair and nrorer charge for the preparation of legal documents, and ‘(c) bv the Public Trustee requiring suc-h solicitor to certify in bis certificate as to the amount of costs he is charging his client.