BC lawyers often handle trust funds on behalf of other people. This is an important responsibility and fundamental to the conduct and completion of all types of business and personal legal transactions and in settling of disputes.

All lawyers who handle trust funds for clients or third parties as part of their practice are subject to rigorous trust assurance standards.

Interest on lawyers' trust accounts

Clients wishing to receive interest on funds held in trust by their lawyer, must give specific instructions to place the funds in other than a pooled trust account. The client would then be responsible for any taxes that may be due based on this interest.

Interest earned on most trust accounts is paid to the Law Foundation of British Columbia, which is a non-profit foundation created by legislation in 1969. This interest goes towards funding of:

  • legal education
  • legal research
  • legal aid
  • law reform
  • law libraries

Only the interest on funds held in a lawyers pooled trust account maintained in financial institutions goes to the Law Foundation.

Trust protection coverage

Since 1949, the Law Society has provided financial protection so that innocent members of the public do not suffer hardship because of the actions of a dishonest lawyer.

If a lawyer has stolen money or other property from a client, the client may be entitled to make an insurance claim.

Although instances of theft are rare, lawyers value the public’s trust and do not want to see the integrity and reputation of the profession stained by the dishonest actions of a few.

How to file a claim

Forms

Transfer form – Electronic transfer of trust funds
Confirmation of Law Foundation of BC Interest Remittance

Checklists

Trust Accounting Checklist 
Sample Checklist of Internal Controls
Disposal Information Checklist

Templates

Opening new trust account sample letter Word | PDF
Canada Deposit Insurance Corporation sample letter
Trust Reconciliation Template 

Resources

Trust Accounting Handbook
Are you or any of your employees US citizens? (Fall 2015 Benchers' Bulletin, p. 13)
Fiduciary Property FAQs
Garnishment of Lawyers' Trust Accounts
How to review a trust bank reconciliation

Online course

Trust Accounting Refresher, Part 2 of the Courthouse Libraries BC series, The Practical Lawyer – In this one-hour webinar, Law Society Trust Team Leader Krista Adamek, CPA, CGA presents a tour of the world of trust accounting and addresses the importance of proper trust accounting practices in safeguarding your client’s trust funds. She also highlights key compliance issues and discusses some current hot topics (2016).