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Divided we stand

Divided we stand

The national legal profession reform process is still working to a timetable of implementation by July 2013 despite half of Australia’s eight states and territories refusing to sign up to the scheme. Justin Whealing reports

The national legal profession reform process is still working to a timetable of implementation by July 2013 despite half of Australia’s eight states and territories refusing to sign up to the scheme. 

Last week, the latest round in the national legal profession reform (NLPR) process was played out.

A steering group on NLPR that was formed in December 2011 met in Melbourne on 8 March.

Representatives from all eight state and territory law societies were in attendance, joining Catherine Gale, the president of the Law Council of Australia (LCA), Stuart Clark, the chairman of the Large Law Firm Group (LLFG) and two representatives of the Australian Bar Association.

“The steering group is concerned with immediate implementation issues, such as the appointment of suitably qualified people to the Board, so we can get the national profession up and functioning in the four jurisdictions that are going to participate,” says LCA president Catherine Gale.]

In a nutshell, Gale provided an insight into the major issue bedeviling national profession reform. 

The fact is that as she looked at representatives from the eight state and territory law societies on the steering group, only half of them were allies of the LCA, and supportive of its current reform agenda. 

New South Wales, Victoria and the Northern Territory are entrenched supporters of the process, with Queensland’s support wavering in the throng of a state election, with no one certain if they will continue to support the process after the poll on 24 March.

Those against it include Western Australia, South Australia, Tasmania and the Australian Capital Territory.

Gale claims her camp have the numbers on their side.

 “The three major eastern seaboard states and the Northern Territory comprise 85 per cent of practising lawyers in Australia – so what we will have is a significant step towards a truly national profession which covers 85 per cent of the profession.”

Gale’s claim that the four jurisdictions on board represent a “significant step towards a truly national profession” is being challenged vociferously by those outside the tent.

“I don’t think the maths supports that 85 per cent of the profession is committed,” says Ralph Bonig, the president of the Law Society of South Australia, one of the renegade jurisdictions. “I don’t think you can just look at the number of practitioners committed. This is all about having uniform processes across all the states and territories, and if you don’t have a majority of the states and territories committed, you can’t say it is a national legal profession.”

This is what we are trying to do 

The stated aims and aspirations of the NLPR process are designed to make the lives of lawyers and clients easier, and offer enhanced consumer protection provisions for the purchase of legal services.

A National Legal Services Board and a National Legal Services Commissioner, both of which would reside in New South Wales, would also be created and would have substantial regulatory powers. 

Supporters of the reforms, such as the LLFG, argue that by having a national set of rules and
regulations, the Australian legal sector would become
more internationally competitive.

“We are a country of 22 million people. It doesn’t make sense for those firms operating across jurisdictional boundaries to have to deal with several different sets of regulations,” says Stuart Clark, the chairman of the LLFG.

“Most of my clients are located overseas. When I send an engagement letter which is in the format required by Australian legislation, bluntly, clients in places like the USA and Europe are pretty surprised. “

“When I then tell them they will have another form for the work we do in Victoria, another one for the work we do in Queensland, they really begin to wonder what is going on.” 

Clark is the chief operating officer and managing partner, international, with Clayton Utz, one of the nine member firms on the LLFG.

The other eight member firms are Allens Arthur Robinson, Ashurst, Corrs Chambers Westgarth, DLA Piper, Feeehills, King & Wood Mallesons, Minter Ellison and Norton Rose.

Clark says that while reform would obviously benefit law firms that have multiple offices, sole practitioners and smaller firms would not be worse off from the process.

“Anything that can increase the overall competitiveness of the Australian legal market is a good thing,” he says. “I do believe there will be spin-off benefits [for small practices], but there is no downside in ensuring we have an effective and efficiently regulated market.”

While the LLFG argues that the reforms are good for the business of law, Gale believes it will also streamline the admissions and continuing professional obligations of lawyers.

“I think there will be lots of benefits to lawyers,” she says. “I think there will be benefits
around consistency in a number of areas we haven’t been able to achieve in the past under the model law, particularly with regard to such things as practising certificates, admissions to practice, continuing professional development and conduct rules.” 

“There is a whole raft of things which will become consistent between the jurisdictions that participate, while under the previous model law situation, there was still quite a lot of differences in the regulatory function in the different states and territories on a day-to-day to basis.”

For Bonig at the Law Society of South Australia, he says that, philosophically, it is hard to find many lawyers who don’t support the concept of reform. However, he questions the view that the current proposals on the table will make the lives of lawyers and clients easier. 

“We have said since day one that we think the proposals on the table involve a massive amount of over-regulation of the profession,” says Bonig.

“The bureaucracy being created has not been costed and we don’t accept it is a self funding process.” 

Bonig believes that far from making the lives of lawyers easier, it will make practitioners, who are already typically time-poor and work long hours, spend even more time at the desk.

“From the solicitor’s viewpoint, compliance with some of the regulatory regimes that are being proposed is going to add an excessive burden,” he says. “Compliance orders, in particular, the time practitioners will be required to meet requests and the cost of meeting the requests of compliance orders on fairly minor stuff is going to place a cost and compliance burden on practitioners.”

Speaking to Lawyers Weekly in September last year, then president of the Tasmanian Law Society, Bill Griffiths, said the reform process could have more adverse outcomes on lawyers in smaller states than those located on the eastern seaboard. 

“It contains expensive procedures, which might not be seen to be expensive by the larger
states but are certainly expensive so far as the smaller states are concerned,” he said.

One day we will all be friends

In announcing that the National Legal Services Board and the National Legal Services Commissioner would be based in New South Wales in October last year, then Federal Attorney General Robert McClelland said he was confident that those jurisdictions not supporting the reforms would eventually change their minds.

“These reforms will deliver clear benefits for the vast majority of the legal profession and I’m confident the remaining jurisdictions will come on board once they can see the clear benefits of the scheme up and running,” he said.

The scheme is due to be up and running by July 2013. Victoria has announced it will be the “host” jurisdiction of the reform process, and it is expected that by around the start of August, the state will pass legislation to introduce reforms that will be replicated across participating jurisdictions.

In a similar vein to McClelland, Gale believes the recalcitrant jurisdictions will come on board
once they see the reforms in action. 

“There is still some work to be done on the remaining  15 per cent [of lawyers in non-participating jurisdictions], but I think it is too early to say that those states and territories have formed a fixed view that they are not going to participate,” she says.

“There are ongoing discussions within those states and territories around the benefits or disadvantages as they see them, and I am confident that in due course, many of those issues will be resolved.” Bonig says the Law Society of South Australia “never says never” with regard to joining the scheme down the track.

However, he believes a lack of regard for the concerns of the objecting jurisdictions makes the reunion of a happy Australian legal family by the middle of next year highly unlikely.

“We will look at whatever model will be implemented, but to say that we will be involved by July 2013 is optimistic given there has not been any attempt to address our issues,” he says.

“People have blindly pushed forward with what their version of the scheme should look like, without looking at the genuine concerns of people who have been asked to participate.” In the meantime, it seems that the naysaying states like South Australia have the luxury of implementing the parts of the reform process that they do like, and leaving the more unpalatable morsels on the tasting plate.

“South Australia was the first state or territory to introduce the Australian Solicitors Conduct rules in July 2011,” he says. “We have always said that if we don’t support the national bill, we are happy to bring on board those parts of it that we think are appropriate.”

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