Have a client who is progressing a civil case following her marriage breakdown, had a sum of money passed to her solicitor from the settlement of the marital property, which the solicitor has been holding pending the assessment of an ongoing legal charge that is due to to be settled with the Legal Services Commission. About £20,000 is being held and the expectation is that most of this would be consumed by legal costs, she also has an ongoing legal case which is being presently financed by the LSC concerning the custody of her son. Presently the capital is not taken into account (disregarded) re commissioners decision CIS 984 2002 / guidance reference 29140 to 29142 in her Income Support award.

Her expectation was that the solicitor would reconcile the amount owed to th LSC and pay them and she to get the difference. But what the LSC have stated for her to be paid the full £20,000 by the solicitor then to settle this herself with the LSC. As she is on Income Support, Housing Benefit / Council Tax Benefit is there a risk that she could be deemed as depriving herself of capital by paying off the LSC so to access her means tested benefits? Would be appreciated if you are able to provide some feedback on the matter.

Graham

"Her expectation was that the solicitor would reconcile the amount owed to th LSC and pay them and she to get the difference. But what the LSC have stated for her to be paid the full £20,000 by the solicitor then to settle this herself with the LSC."

it always used to be the case that the solicitor has to hang on to the money and account to the LSC for it, I would be exceedingly surprised if that has changed... she should check and double check with her solicitor.

Exactly my reaction. This used to be called the "statutory charge" which attaches to any property recovered or preerved in legally-aided proceedings. I always understood that, in practice, legal aid was a loan which is repayable out of any winnings before the money could be released.

The only exception I can think of would be if the amount of work done was below the threshold at which payment was made so that no claim was ever made on the legal aid fund. But I don't know how it works these days. It's a long time since I was in practice and they had real legal aid in those days, not this funny stuff you get now.