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Lawyers smarting after High Court ruling

Lawyers smarting after High Court ruling

THE HIGH COURT handed down a blow to all lawyers last week in upholding a ban on personal injury lawyers advertising their services in New South Wales, lawyers claim. In a 5-2 decision, the High…

THE HIGH COURT handed down a blow to all lawyers last week in upholding a ban on personal injury lawyers advertising their services in New South Wales, lawyers claim.

In a 5-2 decision, the High Court last week found against the Australian Lawyers Alliance, law firm Maurice Blackburn Cashman (MBC) and solicitor Bob Whyburn, who said that the advertising ban was unconstitutional because it impeded people’s rights to access the courts.

But the impact goes much further than this, Australian Lawyers Alliance president Richard Faulks told Lawyers Weekly. “If governments can impose these types of restrictions on lawyers, they can do it for any other industry,” he said.

Lawyers and law firms could soon be smarting as a result of the advertising ban, Faulks said. They should feel concerned at the potential impact on them and the way they conduct their business, he said. “I think there is a message there that there is a potential at any time for the government to restrict advertising across the board for all lawyers, in all areas.

“In today’s society that is a very strict and unnecessary restraint on the operation of business. It may have been appropriate when the law societies had rules about advertising back in the early 1900s, but these days the profession is seen as a business and it should be entitled to promote itself,” Faulks said.

These new restrictions could easily be imposed on lawyers in other practice areas, he said. “There is nothing to stop the NSW Government, for example, passing legislation to stop lawyers advertising for business work, or advertising to give advice on a leasing matter or property matter.

“The principles are the same — the decision is not confined to allowing a government to pass laws restricting advertising simply for personal injury lawyers. It just happens to be an example of what the government did on this occasion. The implications are much broader and beyond lawyers to other professionals like doctors and architects and other businesses. I would think it would sound some warning bells for other groups in society,” he said.

Law firm Maurice Blackburn Cashman special counsel Peter Cashman said the decision was “incredibly disappointing for injured people”.

“Communication between lawyers and the public, like all other forms of communication in this country, should not be banned or subject to criminal prosecution,” Cashman said. “We now have one law regarding advertising in New South Wales, another in Queensland and other laws in the rest of the country — this is not a good law.”

The High Court decision reinforces the differences between the states, said MBC CEO Greg Tucker. “There is no common advertising regime across the states in relation to legal advertising. So, while the rest of the legal system is converging towards one system in the way it is all set up, and most from the first of October, in regard to advertising it still remains very different. The High Court decision reinforces those differences.”

Faulks, for the Australian Lawyers Alliance, said it is likely that the High Court result will impact law firms. “This is a gross restriction for [firms that cover] this particular area. You might have unknown plaintiffs that may want to join in a class action and may not even be aware of the existence of the class action, because no one can tell them about it. So, I think there are some real issues for [these firms],” he said.

People will get lawyers on the basis of reputation, or by actively seeking them out, said Tucker. “So, people can look up the Yellow Pages and websites, but of course in those places you can’t advertise injury lawyers. You can advertise that you are lawyers, but not that you are injury lawyers, that you can take up the rights of injured people and take their causes forward,” he said.

Pressed as to whether this was a clamp down on what is commonly referred to as ‘ambulance chasing’, Faulks said that while “that may well be one of the effects of the law”, the legal profession had always had its own codes of conduct that limited the way in which lawyers were able to advertise, “to ensure it wasn’t in a distasteful and inappropriate manner”.

“The Government could easily have imposed some laws that limited the type of advertising that was done. It didn’t choose to do that; it used a sledge hammer approach and effectively removed every possible way a lawyer could advertise in this area. The use of words ‘personal injury’ is the offending thing,” he said.

The changes are not about protecting people from ambulance chasers, Faulks said. Instead, the Government is protecting the insurance industry and help it cut claims. “I don’t think they are protecting people at all. With this law, the Government made it quite clear that what it was endeavouring to do was to assist the insurance industry by reducing the number of claims, at a time when they felt there was a need for the Government to act to cut the insurance premiums,” he said.

“The Court acknowledged the regulations themselves were quite explicitly brought in with the view to cut claims. In other words, they said the motivation was entirely to stop people bringing claims by effectively preventing lawyers advertising and people getting access to info about their claims. That is a real worry, I think.”

Other states are now able to follow NSW’s lead, said Faulks, in implementing the same restrictions on personal injury lawyers. While there are already some limitations imposed in Queensland and Western Australia, these are not as far reaching as those in NSW. “But, obviously, based on this decision, it would be open to other States and Territories to impose this restriction,” he said.

But while NSW has left the door swinging for the other States to follow, Faulks argued this is unlikely. “My understanding is that none of the others want to do it, they don’t feel the need to do it.”

“Certainly, in the ACT, our Government has come out quite clearly and said that it feels it is a totally unnecessary and inappropriate restriction,” he said.

“[The Australian Lawyers Alliance] hopes that common sense prevails in other jurisdictions at least and hopefully there will be an opportunity to talk with the NSW Government about amending the law in due course — to make it more appropriate and take in the needs of the injured and their rights to get information about their injuries and what they might do about [them],” Faulks said.

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