Report a mixed trust account

As set out in subsection 57(1) of the Law Society Act, a mixed trust account is one in which a licensee holds money in trust for or on account of more than one client in one fund.

Every mixed trust account must be reported. The mixed trust account information can be filed by a lawyer, paralegal, or designated financial filing licensee on behalf of a firm, who is responsible for client trust monies held in a mixed trust account at any time during the reporting year. This could include sole practitioners, the designated financial filing licensee on behalf of a firm, or any licensee who is responsible for a mixed trust account not otherwise reported.

Under section 57 of the Law Society Act, The Law Foundation of Ontario receives the interest on lawyers’ and paralegals’ mixed trust accounts. By statute, 75% of this revenue goes to Legal Aid Ontario. The Law Foundation of Ontario uses the other 25% to make grants that advance access to justice.

Effective January 1, 2016, lawyers and paralegals must report annually on each mixed trust account held at any time during the licensee’s reporting year in their Lawyer Annual Report or the Paralegal Annual Report filing through the Law Society of Ontario Portal.

A licensee who is a member of a firm may be responsible for a mixed trust account which is not the responsibility of the firm and therefore not reported by the firm’s designated financial filing licensee. That mixed trust account must be reported separately by the licensee on his or her Annual Report.

You must complete a Report on Opening or Closing a Trust Account and forward it to the By-Law Administration Services department at the Law Society of Ontario. If it is a mixed trust account, you must direct your financial institution to pay any interest on the account to The Law Foundation of Ontario. You should keep a copy of the direction and send another copy to The Law Foundation of Ontario to assist in ensuring that the interest is remitted.

The Law Foundation of Ontario may request a supplementary report to confirm or clarify information regarding your mixed trust accounts. See Ontario Regulation 709/15. As a general rule, your regular monthly bank statement provides the necessary information to complete a supplementary report if one is requested. You should also keep a copy of your direction to the financial institution to remit interest to The Law Foundation of Ontario.

Under Ontario Regulation 709/15,  Form 1, Form 2, and Form 3 are no longer used. New and closed mixed trust accounts are reported on the annual filing. All reporting requirements can be found at the Law Society of Ontario.

Contact the Law Society of Ontario to help you with this.

You can contact the Law Society of Ontario or contact The Law Foundation of Ontario at mixedtrust@lawfoundation.on.ca or 416-598-1550.