SA Legal Practitioners: Foreign Lawyers and Trustee Companies Amendments

The Legal Practitioners (Foreign Lawyers) Amendment Bill 2019 (SA) (the Bill) was introduced into the South Australian Assembly on 14 November 2019 by the Attorney-General, VA Chapman. The Bill proposes to amend the Legal Practitioners Act 1981 (the LPA) by inserting provisions regulating the practice of foreign law by foreign lawyers in SA and providing for their local registration and regulation. It also makes changes relating to trustee companies coming within the definition of “incorporated legal practice” used in the LPA.

Background

Foreign law is the law of a country when practised outside of that country. Foreign lawyers are able to practise foreign law in Australia where they are qualified to practise law in their home country or foreign jurisdiction.

The “foreign lawyers amendments” proposed by the Bill originated from a request made by the presidents of the Law Society of SA, the SA Bar Association and the Law Council of Australia seeking amendments to the LPA to include provisions for the registration and regulation of foreign lawyers practising foreign law in SA.

According to the Attorney-General the SA Law Society’s view is that including foreign lawyer provisions in the LPA will “. . . facilitate the provision of legal services across South Australian borders and also provide export opportunities for South Australian legal practitioners and practices.”

Currently SA is the only jurisdiction not to have these provisions in its legal practitioner laws.

Foreign Lawyer Changes Based on “Legal Profession Model Bill”

According to the Attorney-Genera, the LPA has been subject to some major changes.  The last round of major amendments to the LPA came into force on 1 July 2014 and included abolishing the “Legal Practitioners Conduct Board” and establishing the new office of “Legal Profession Conduct Commissioner” which was also given expanded powers to deal with misconduct by legal practitioners. These changes also included four new schedules to deal with incorporated legal practices, trust money and trust accounts, costs disclosure, and adjudication and investigatory powers.

The new schedules were based on the Legal Profession Model Bill, which applies in all jurisdictions except for NSW and Victoria who operate under the Legal Profession Uniform Law Application Act 2014. In both systems provisions for the regulation and registration of foreign lawyers are included and locally registered foreign lawyers are only permitted to practise foreign law in Australia. Practitioners who are admitted overseas wishing to practise Australian law must apply for admission in Australia and as a result will then be regulated under Australian legal practitioner legislation.

The provisions proposed in the SA Bill are modelled on the relevant provisions from the Legal Profession Model Bill keeping SA consistent with the other model Bill jurisdictions.

Trustee Companies Amendments

Another amendment proposed by the Bill relates to trustee companies. Trustee companies are corporations regulated by the Corporations Act 2001 (Cth) providing “traditional trustee company services”. They are defined in the Corporations Act as:

  • performing estate management functions;
  • preparing a will, a trust instrument, a power of attorney or an agency arrangement;
  • applying for probate of a will, applying for grant of letters of administration, or electing to administer a deceased estate; and
  • establishing and operating common funds.

According to the Attorney-General’s second reading speech, the National Australia Bank, identified an issue with the LPA affecting its subsidiary, the National Australia Trustees Limited (NAT), namely that, trustee companies such as NAT most likely fall within the definition of “incorporated legal practice” used in the LPA - a problem that has also been identified with respect to legal profession legislation in other jurisdictions.

Because trustee companies do in fact fall within the definition of an “incorporated legal practice under the LPA” they are required to comply with the entire regulatory regime set out in Schedule 1 of the LPA, which covers incorporated legal practices. This according to the Attorney-General means, not only are trustee companies over-regulated, they are also subject to both State and Commonwealth regulatory regimes, the result being that some of the provisions of the LPA, as they apply to trustee companies, may be inconsistent with the commonwealth Corporations Act and therefore invalid. To avoid this the Bill proposes to amend the LPA to remove trustee companies from the ambit of the LPA. Section 21(3)(s) of the LPA is to be amended to exclude trustee companies offering traditional trustee company services (as defined by the Corporations Act) from the operation of the LPA.

The Attorney-General points out that the relevant trustee companies are “sufficiently regulated by the Corporations Act such that there is no risk to consumers of a trustee company being under regulated”. The proposed amendment is to be supported by regulations to be made under Clauses 1(2)(c) and 1(3) of Schedule 1 of the LPA which will exclude trustee companies from the operation of the LPA and are to be developed following the passage of the Bill.

Comment by the Attorney General

In a recent media reelase, the Attorney General stated that the key result from the Bill will be greater protection of legal consumers and the preservation of public trust:

“Until now there has been no requirement for a foreign lawyer to register in South Australia to provide foreign law services, . . .By requiring registration, lawyers will need to meet the standards and conditions of the registration and there will be greater oversight of who is practising, their qualifications and conduct . . . Ultimately that will provide greater protection for consumers, and it will also serve to preserve public trust in the legal profession.”

The Bill is at second reading moved stage and is yet to be debated.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products. Nothing on this website should be construed as legal advice and does not substitute for the advice of competent legal counsel.

Sources:

Legal Practitioners (Foreign Lawyers) Amendment Bill 2019 (SA), second reading speech and explanatory material, available from TimeBase's LawOne service

Media Release: Regulation proposed for foreign lawyers (SA Attorney-General, 14/11/2019)

Foreign law and lawyers in Australia (Law Council of Australia)

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