Taking cash: the limit, and the receipt book most firms forget

The cap is per matter, not per payment

By-Law 9 limits the cash a licensee may accept, in the aggregate, for any one client matter. The figure is $7,500. The word doing the work is aggregate: it is not a limit on a single handover, so four payments of $2,000 across the life of a file are over the line even though no one of them is close to it.

That is the shape of the rule most often got wrong, because nothing about any individual payment looks unusual. A firm that thinks of the cap as applying to the envelope in front of it can pass the limit without there being any moment where someone would have noticed.

The receipt book is a separate duty

Alongside the cap, By-Law 9 requires a book of duplicate receipts for cash received. Each receipt identifies the client, the matter, the amount, the date and the person from whom the cash came, and is signed by that person and by the licensee or someone the licensee has authorised.

This catches firms out because the two requirements are mentally filed together and are not the same thing. A firm that rarely sees cash concludes the cash rules do not really apply to it, so never sets up the book, then takes one cash retainer, records it perfectly in the trust ledger, and has still missed a record it was required to keep.

• The receipt is required because cash was received, not because the amount was large.
• It is a duplicate book: the client copy and the firm copy come from one sequence, which is what makes it evidence rather than a note.
• It sits alongside the trust ledger entry. It does not replace that entry, and the entry does not replace it.

What counts as cash

Cash means currency. A certified cheque, a bank draft, a wire and an electronic transfer are not cash for this purpose, which is why the practical answer to a client who wants to pay a large retainer in banknotes is usually to ask for one of those instead. The rule does not restrict what the firm may be paid. It restricts the form.

There are narrow exceptions in the by-law for particular kinds of receipt. They are narrow enough that reading them at the moment they matter is better than half-remembering them now.

Why the rule exists, which is the part worth carrying

The cash limit is an anti-money-laundering control, not a bookkeeping preference. A law firm trust account is attractive to someone moving illegitimate money precisely because it is a respectable place for funds to sit, and cash is the form that arrives with no trail attached to it.

Reading it that way makes the adjacent duties feel less arbitrary. The client identification and verification requirements exist for the same reason, which is why an unusual cash request is worth treating as a prompt to look harder at the retainer rather than only as a limit to be complied with.