ILLEGAL PRACTICE.

Hokitika Guardian, 2 December 1924, Page 3

ILLEGAL PRACTICE.

PROCURATION FEES. ' PREMIER REPLIES TO ENQUIRIES. Recently a set of f|tiestioiis affecting the Public Trust (MIL o was put to the Prime .Minister. Mr Massey has considered the quest ions and announced his answers. The questions were: (1.) Whether he is aware that many solicitors and other versons 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 stops to stop the practice, seeing that under the Public Trust Office Amendment Act. 11)21-22. it was made illegal (:i.) Whether arrangements could not he made for applicants for loans to have their applications prepared by an agent of the Public Trustee, or in any office of the Public Trustee, and their securities prepared ly the Public Trust Office ?

(I.) Whether lit* "ill 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 miner ossnrv burden?

Mr Massey’s answers are: (I). The Government is not aware that any solicitors or other persons putting in ap! licai ions to the Public Trust Office for loans on behalf of clients are charging procuration fees for c.btnniug the loans. The Government was' under the impression that the practice had boon discontinued, especially since the recent remarks of a judge of the Supreme Court in-Auck-land condemning the practice generally. (2.) Having by section 10(1 of the Public Trust Office Amendment Act. 11/21-22, made the practice illegal, the Government "ill take all possible steps to deal with any eases, which are brought under notice.

O!) In any case where an applicant submits an application for a loan to a branch of the Public Trust Oliiee without the intervention ol any solicitor, the application is prepared by the office*, and if no solicitor is nominated for the purpose the security is prepared by the Public Trust Oliiee. In the circumstances it does not appear that any further arrangements are required to he made in the direction of having securities prepared h,v the Public I mstee. (I) With regard to the limitation of solicitors’ costs to the proper legal charges, the Public Trustee does not wish to interfere between clients and their solicitors, hut if any cases are brought under notie of procuration fees having been charged the Public Trustee will take all necessary action to obtain a refund on behalf nt the client against whom the fees have been charged. Ihe Public Trustee stales that he had endeavoured to eliminate the necessity for solicitors charging procuration fees bv allowing practitioners submitting loans a fair rale of remuneration for the preparation of the necessary securities. Solicitors are allowed to charge according to the recognised scab* prescribed by the Law Society for such work. Moreover. a solicitor in furnishing his certificate is required to certify that he has made no charge beyond that prescribed by such scale. The Public Trustee leels that he has done all he can legitimately do to stop the practice eomnlained of • hut. as already slated, if any cases are brought under hi-, notice la* "ill take the necessary action. But so long as solicitors observe the recognised practice and act fairly towards their clients the Public Trustee docs not desire to disturb the relations existing between them, and their clients with the object of diverting work to the Public Trust Oliiee.

(5) |t may he taken, therefore, that the practice of charging procuration fees is by no means a general one. hut there may he isolated cases, and it is considered that everything possible has been done in the limiter by (a) the passing of legislation making the practice of charging such I'c-s illegal, (hi I>v the Public Tin-tee allowing a soli,it or acini'- to h dia 11 ot a *-I ient a fa ir and propel (barge lor the preparation of legal i h ***n ic -*ii Is. ami (r> bv tin* Pul,lie Ti n- c • "cqiiirmg such solicitor to certify in his certificate as to the amount of costs lie is charging his client.