A. INTRODUCTION

4.1 In this chapter and in the remaining four chapters of this Part, we consider a number of specific issues concerning the general regulation and structure of the profession. In doing so, we proceed from the general views which we expressed in chapter 3. The principal recommendations which we make in these chapters are listed as recommendations 1-14 in the Summary of Principal Recommendations at the beginning of this Report.

4.2 The main issues considered in the present chapter are as follows.

• Admission to the Profession

Should all persons admitted to the profession be admitted under a common title? If so, what should be the common title?

• General Regulatory Bodies

Which should be the general regulatory body or bodies of the profession? What should be the general nature of the powers of the body or bodies, especially in relation to the making of statutory regulations?

• The Right to Practise

Should all lawyers be required to hold practising certificates if they wish to practise? Who should receive the fees paid for practising certificate fees and for what purposes should the money be used?

A number of related issues are considered in later chapters. They include, for example, the precise composition of the general regulatory body or bodies, whether there should be different types of practising certificate, and the requirements for obtaining a practising certificate.

B. ADMISSION TO THE PROFESSION

I. Common or Separate Admission?

4.3 It is convenient to express at this early stage our conclusions on the question of common or separate admission. ¹ But those conclusions have been arrived at in the light of the views we have formed on a number of the issues dealt with later in this Report. For example, for reasons which we give later, we do not favour the retention of different pre-admission training requirements for barristers and solicitors. ² And although we suggest that different practitioners could be subject to different general regulatory bodies, and that post-admission training requirements might differ somewhat between different practitioners, we do not favour any such differences being based on whether a practitioner is admitted as a barrister or as a solicitor. ³ Indeed, later in this Report, ⁴ we consider a number of existing distinctions based on whether a practitioner is admitted as a barrister or as a solicitor, and in each instance we conclude that a distinction on that basis is inappropriate and should not be retained. In some of the areas which we cover in later Reports, such as complaints and discipline, and professional indemnity insurance, there are certain distinctions between barristers and solicitors. For reasons which will appear in those Reports, we do not consider that those distinctions are justified. if the existing distinctions based on admission as a barrister or as a solicitor are inappropriate and, accordingly, are abolished, then much of the possible justification for separate admission disappears. Moreover, the abolition of separate admission would remove the danger of further distinctions of an inappropriate nature being introduced between barristers and solicitors.

4.4 It may be argued that separate admission under different titles helps lawyers and members of the public to identify practitioners who practise in the traditional style of barristers. Such identification can be helpful where, for example, a practitioner wishes to refer a matter to another practitioner without fear of losing his or her client, or a member of the public wishes to avoid approaching practitioners who do not accept work directly from clients. But the present system of separate admission in New South Wales is not necessarily an accurate indication of those who practise in the traditional style of a barrister. First, solicitors may practise in the traditional style of barristers. Secondly, many barristers and solicitors practise in the same style, namely as employees in the legal departments of governments and corporations. Thirdly, it is not clear whether even barristers in private practice are required to practise in the traditional style of a barrister, unless they bind themselves to do so by joining the Bar Association. ¹

4.5 In our view, separate admission contributes to exaggerated notions of the extent and significance of the differences between those who practise in the style of barristers and the remainder of the profession. For example, it contributes to the tendency, referred to in a submission to us by the Law Society, ¹ for the degree of specialisation amongst barristers to be over-estimated, and for that amongst solicitors to be under-estimated, by some lawyers and members of the public. It contributes to the tendency in some quarters to think of barristers as necessarily more experienced and more expert than solicitors in advocacy and advisory work, and as constituting the “senior branch” of the profession. The procedural requirements and delays involved in transferring from being admitted as a barrister to being admitted as a solicitor are obstacles in the way of a practitioner who wishes to change from the traditional style of a barrister to that of a solicitor. ² The same is true of transfers in the other direction. In these and other ways separate admission hinders flexibility within the profession. Yet, as is demonstrated by the experience in the southern States of Australia, ³ it is not necessary to have separate admission in order to have a strong and vigorous Bar.

4.6 These considerations lead us to the conclusion that separate admission as a barrister or a solicitor should be abolished in favour of common admission under a common title. The question then arises: What should be the common title?

II. A Common Title for Admission

4.7 We see three principal possibilities for use as a common title. They are “barrister and solicitor”, “lawyer” and “legal practitioner”. ¹ The composite title, “barrister and solicitor”, is already in use as a common title in all parts of Australia save New South Wales and Queensland. ² Being a combination of the two present titles, it could help to convey the abolition of separate admission, while at the same time retaining words which have emotional significance for many lawyers. The appearance of the word “barrister” in the title would have a special attraction for practitioners wishing to specialise in advocacy or advisory work. On the other hand, a substantial disadvantage of “barrister and solicitor” is that some practitioners who do not wish to undertake advocacy might not want to use a title which includes the word “barrister”, and some practitioners who do not wish to accept work directly from clients might not want a title which includes the word “solicitor”. The terms “lawyer” and “legal practitioner” lack the advantages of “barrister and solicitor” to which we have referred, but they also lack the substantial disadvantage which we have mentioned. They are less likely to cause confusion in the minds of members of the public, especially those who do not have an English-speaking background.

4.8 An important consideration affecting our choice of a common title for admission to the profession is that, in our view, admission to the profession should not confer, of itself, a right to practise. It should be necessary also to hold a practising certificate, as is presently the case in relation to solicitors. Our reasons for this view are given later in the chapter. ¹ Its relevance in the present context is that it makes it desirable for the title acquired upon admission to be of a kind which does not convey the impression of an entitlement to practise. None of the three titles to which we have referred is ideal from this point of view, but “legal practitioner” is perhaps the least satisfactory. It is better suited for use as a generic description of those who are entitled to practise. Both “barrister and solicitor’ and, perhaps to a lesser extent, “lawyer” might be interpreted by many people as connoting an entitlement to practise. But it is not easy to devise a simple title which avoids this problem. Moreover, the extent of the problem would be reduced by a general prohibition on holding oneself out as entitled to practise unless one is the holder of a practising certificate. Such a prohibition presently exists, in effect, in relation to practising as a solicitor. ² If the common title for admission were “barrister and solicitor” or “lawyer”, the effect of a prohibition along these lines would be that a person who is admitted, but does not hold a practising certificate, could use the common title in some circumstances but not, for example, in a situation where it is reasonably likely that a potential client will interpret it as connoting an entitlement to practise.

4.9 For the reasons outlined, we favour either “barrister and solicitor” or “lawyer” as the common title for admission. We have no firm preference between these two alternatives, but in this Report we shall use the term “barrister and solicitor”. We shall use the term “legal practitioner” to denote a person who not only has been admitted to the profession but also is entitled to practise.

C. GENERAL REGULATORY BODIES

4.10 We have described earlier’ the positions of the Law Society Council and the Bar Council as the general regulatory bodies of solicitors and barristers respectively. The Law Society Council has extensive statutory powers in relation to solicitors, including the power to make statutory regulations, but the Bar Council has no such powers in relation to barristers. In addition, the Governor has extensive powers to make regulations in relation to solicitors and to veto regulations made by the Law Society.

4.11 In considering whether the present position is satisfactory, three inter-related issues arise, namely:

• Is it appropriate for a professional association to be also a general regulatory body?
• Should there continue to be different general regulatory bodies for different sectors of the profession?
• What, in general terms, should be the powers of a governing body, especially in relation to the making of statutory regulations?

I. Professional Associations as General Regulatory Bodies

4.12 For reasons which we explain in the next section, we are of the view that, at least for the time being, there should continue to be two general regulatory bodies of the profession, each with responsibility for a different sector of the profession. The question here is whether those bodies should continue to be the Law Society Council and the Bar Council, each of which is also the governing body of a professional association. The advantages and disadvantages of the present position have been described in chapter 3. ¹ The advantages relate principally to the danger that separation of the general regulatory roles and the professional association roles might lead to a situation in which the general regulatory bodies are less than effective, and the professional associations are unduly self-interested and, in many respects, are more powerful than the regulatory bodies. In addition, there is the consideration of the substantial cost likely to be involved in creating new general regulatory bodies. On the other hand, as we described, there are two powerful disadvantages. The first is the serious conflict, both actual and apparent, between the responsibility of a general regulatory body to act in the public interest and the responsibility of a professional association to advance the interests of its own members. The second arises from the fact that, in our view, practitioners ought not to be required to join a professional association in order to have a vote for membership of the general regulatory body to which they are subject.

4.13 The advantages to which we have referred are substantial, and measures can be taken to reduce considerably the first of the two disadvantages and to avoid the second disadvantage. Accordingly, we consider that it is acceptable for the Law Society Council and the Bar Council to be the general regulatory bodies of the profession, provided that the following conditions are satisfied.

(i) There should be substantial and effective community participation in the system of general regulation, including community representation on the Law Society Council and the Bar Council. We make detailed recommendations to this effect in chapter 5.

(ii) The Governor should have certain powers to make statutory regulations in relation to the profession, and any regulation made by a general regulatory body should be subject to the approval of the Governor. As we have mentioned, the Governor presently has extensive powers to make regulations in relation to solicitors. We return to the question of regulation-making power in paragraph 4.29-4.31, and we explain there our differing views about the range of regulation-making power which should be vested in the Governor.

(iii) All practitioners should be entitled to vote in elections for membership of the Council which is their general regulatory body, irrespective of whether or not they are members of the professional association in question (ie. the Law Society or the Bar Association).

(iv) In the exercise of such statutory powers, including powers to make regulations, as may be vested in them, the Councils should not be subject to direction or restraint by a general meeting, or any other organ, of their professional association. This condition is presently satisfied in relation to the Law Society Council.

(v) The question whether the Law Society Council and the Bar Council should continue as the general regulatory bodies should be subject to a periodic review initiated by the Attorney General. We make recommendations in chapter 8 in relation to periodic review of this and other aspects of regulation and structure.

4.14 The Law Society and the Bar Association might be reluctant to have non-members voting in elections for their governing bodies, which in addition to their general regulatory role would be responsible for advancing the interests of members. The associations may consider that their non-regulatory functions, such as the provision of advisory or library services for members, should be controlled by a body chosen solely by members. We recommend later that any such functions should be funded solely from membership fees, rather than, as is presently the case in relation to the Law Society, from practising certificate fees. On the other hand, the associations might well consider that the practical disadvantages of this situation are slight, and from their point of view are outweighed by the advantages of remaining as the general regulatory body. This is especially likely to be the case if the great majority of practitioners subject to a particular Council are members of the professional association in question. Moreover, if either association wished to do so, it could provide for the control of some or all non-regulatory functions to be vested in some organ of the association other than the Council, or could give a general meeting or some other organ of the association power to override the Council in relation to non-regulatory functions.

4.15 If the system which we have recommended proves to be unworkable because of opposition from the Law Society or the Bar Association, it will be necessary to effect a complete separation of general regulatory roles and professional association roles. This was the approach suggested by our colleague, Mr Conacher, in Part II of the Discussion Paper, The Structure of the Profession. He suggested the creation of a new general regulatory body for barristers, to be known as the Bar Governors, and of an analogous body for solicitors. We do not oppose complete separation of the two roles; indeed, we favoured it at the time of writing our Discussion Paper, General Regulation. But we think that before introducing such a major reform an attempt should be made to improve the existing system along the lines we have recommended.

4.16 If it does become desirable to create new general regulatory bodies, rather than continuing to use the Law Society Council and the Bar Council for that purpose, the composition of the new bodies should be similar to that which we recommend in this Report for the existing Councils. In other words, between 15 and 20 members of each body should be chosen by the practitioners who are to be subject to that body, and 5 “public members” should be chosen along the lines recommended in chapter 5. We recommend in chapter 5 that the public members should not have voting rights. Some of the justification for this recommendation does not apply to a general regulatory body which does not also have the responsibilities of a professional association.

II. Two General Regulatory Bodies or One?

4.17 If different sectors of the profession are subject to different governing bodies, there is a greater likelihood of inappropriate distinctions being drawn between practitioners who are subject to different bodies, and of the emergence of undue barriers to flexibility and freedom of choice within the profession. ¹ Issues which are of a similar nature may arise in relation to practitioners who are subject to differing bodies. For example, questions concerning designation of specialists in particular fields of practice, or the control of lawyers employed by governments or corporations, directly affect both barristers and solicitors. The separation of regulatory power can lead to inconsistency and unfairness, or to an undesirable lacuna in regulation because the general regulatory bodies cannot agree on a common policy. There is a danger, too, that each body, especially if it is also the governing body of a professional association, may tend to act in the interests of its own sector of the profession rather than giving sufficient weight to the interests of the profession as a whole, let alone to the public interest if there is more than one general regulatory body, there may be an inefficient duplication of effort and expenditure. Moreover, if one of the bodies is responsible for only a small sector of the profession it may not be able to devote adequate resources to important functions such as the investigation of complaints and the provision of advisory and educative services for its members.

4.18 It is necessary, however, to take into account in New South Wales the established positions of the two general regulatory bodies, the Law Society Council and the Bar Council. If either body were to be made the sole general regulatory body for all practitioners, there would be a powerful case for saying that it should be the Law Society Council, since the Law Society has far more members and much greater resources than the Bar Association. But this would mean that barristers, who now govern themselves, would become subject to a body elected largely by solicitors. As a result, barristers might not co-operate or identify with the general regulatory body, and effective regulation might be made difficult. Expense and dislocation would be involved in transferring responsibility for all barristers to the Law Society Council. Moreover, it is likely that the Bar Council would continue to exist and to exercise considerable control over members of the Bar Association through its internal rules.

4.19 We have no doubt that, in principle, it is preferable for all practitioners to be subject to the same general regulatory body. But, bearing in mind the practical difficulties involved in introducing one regulatory body for the whole profession under the present circumstances, we consider that for the present it is acceptable to continue with two general regulatory bodies for different sectors of the profession, provided that the following conditions are satisfied.

(i) The Law Society Council should be the general regulatory body for all practitioners, whether practising in the style of a barrister or in some other style, save those practitioners who elect to be governed by the Bar Council and undertake to comply with its rules in relation to professional practice.

(ii) As we have said earlier, the Governor should have some powers to make statutory regulations in relation to all practitioners, and any regulations made by a general regulatory body should be subject to the approval of the Governor. Subject to our differing views about the powers which the Governor should have to make regulations, ² one consequence of giving the Governor power to make or veto regula-tions would be to reduce the danger of inconsistency, unfairness or undesirable inaction due to the two general regulatory bodies having different policies on similar or related issues.

(iii) As we have said earlier, ³ there should be effective community participation in both general regulatory bodies. One consequence of value in the present context is that community participation might reduce the tendency for either body to be excessively concerned for the interests of its own sector of the profession, rather than taking a broader approach. We make detailed recommendations concerning community participation in chapter 5.

(iv) Implementation of other recommendations in this report is likely to lead to a substantial reduction in the present degree of division within the profession, thus making it feasible to proceed with the introduction of one general regulatory body for the whole profession. This question should be kept under review, including the periodic review recommended in chapter 8.

4.20 Mr Disney joins in the views expressed in the previous paragraph, and in the recommendations in this Report which flow from them, on the ground that implementation of them would constitute a substantial improvement of the present system for general regulation. But he considers that, for the reasons given in paragraph 4.17, greater improvement would result from proceeding with the introduction of one general regulatory body for the whole profession, rather than awaiting a further review. In his view that body could be the Law Society Council, provided that all practitioners are given the right to vote for practitioner members of the Council and that public membership of the Council is introduced along the lines recommended in chapter 5.

A Question of Terminology

4.21 Under a regulatory system of the kind described in the previous paragraph, a practice might develop of describing practitioners who are subject to the Bar Council as “barristers” and those who are subject to the Law Society Council as “solicitors”. In our view, such a practice would be most undesirable. The objections to it are similar to some of those which we mentioned earlier as reasons for abolishing separate admission. ¹ For example, it would tend to perpetuate the present exaggerated notions of the extent and significance of the differences between those who practise in the style of barristers and the remainder of the profession, including the notion that barristers constitute the senior branch of the profession. It would be unfair and inaccurate in relation to practitioners under the governance of the Law Society Council, especially those who wish to practise in the style of a barrister. it would unduly inhibit the development of specialist advocates and advisers who practise in some style other than that of a barrister.

4.22 We suggested in our Discussion Paper, Advertising and Specialisation, that practitioners should be given considerable freedom to advertise, amongst other information, whether or not they are in sole practice, the fields of practice in which they accept work or have a special interest, and whether or not they accept work directly from clients. ¹ In our view, these suggestions would provide lawyers and clients with clearer, more comprehensive, and more accurate information than would be conveyed by using the terms “barrister” and “solicitor” according to whether a practitioner is subject to the Bar Council or the Law Society Council.

4.23 We recommend that, with the introduction of common admission, the terms “barrister” and “solicitor” should cease to be used, other than in the composite term “barrister And solicitor” if that is adopted as the common title for admission. In particular, we recommend that the terms should not be used in legislation, or by the courts, the Government, or the general regulatory bodies, in order to distinguish between practitioners who are subject to the Bar Council and those who are subject to the Law Society Council. ¹

III. Powers of General Regulation

The Law Society Council

4.24 As we have mentioned earlier, the Law Society Council has a wide range of statutory powers, including powers to make regulations subject to the approval of the Governor. ¹ It has specific powers to make regulations on particular matters, especially in the areas of complaints and discipline, practising certificates, indemnity insurance, trust accounts and the Fidelity Fund. In addition, it has a general power to make regulations concerning “the professional practice, conduct and discipline of solicitors”. ² We are of the view that if the Council is to continue as a general regulatory body it should continue, generally speaking, to have its present statutory powers. We say “generally speaking” because later in this Report and in other Reports, when looking at particular areas of regulation, we shall consider whether the Council’s present powers in those areas should be altered. The Council’s statutory powers should be exercisable in relation to all practitioners for whom it is the general regulatory body. As we have said earlier, the Council should not be subject to direction, whether by a general meeting of the Law Society or otherwise, in the exercise of its statutory powers.

4.25 The Council has extensive non-statutory powers, arising from the Memorandum and Articles of Association of the Society, in relation to members of the Society. We make no recommendations for change in that respect. One way in which the Council exercises these powers is to make rules and rulings on aspects of professional practice. Some of these rules and rulings are binding on members of the Society as a matter of contract. Others are of an advisory nature. Breach of a rule or ruling, even of one which is contractually binding on the practitioner in question is not, in itself, professional misconduct. But the Statutory committee and the Supreme Court, which are the disciplinary tribunals for solicitors, have regard to the Council’s rules and rulings on the basis that they indicate what the main professional association of solicitors considers to be principles with which solicitors should comply. In our view, it is appropriate for disciplinary bodies to continue to do so, provided that they have regard to whether the relevant rules or rulings are contractually binding or merely advisory, to whether or not the practitioner is a member of the Law Society, and to relevant rules or rulings of other professional associations, especially those of an association of which the practitioner is a member.

The Bar Council

4.26 The Bar Council has no statutory powers to regulate barristers, whether members of the Bar Association or otherwise. In our view, the Council should have some statutory powers and these powers should be exercisable in relation to all practitioners for whom the Council is the general regulatory body. It should have powers, including the power to make regulations, in relation to certain specified matters. For example, implementation of the recommendations in our Second Report, on Complaints, Discipline and Professional Standards, would require that the Bar Council be given statutory powers in relation to the investigation of complaints. Should the Council be given a general power, analogous to a present power of the Law Society Council, to make regulations in relation to “professional practice, conduct and discipline”? Mr Gressier considers that the Council, as a general regulatory body, should be given such a power. Mr. Disney and Judge Martin, however, consider that it is more appropriate to recommend, as we have, that all practitioners who elect to be governed by the Bar Council should be required to undertake to comply with its rules.

4.27 Under the Bar Association’s Memorandum and Articles of Association, the Bar Council has extensive non-statutory powers in relation to members of the Association. In the exercise of these powers it makes rules and rulings in relation to professional practice. We have recommended earlier that all practitioners who elect to have the Council as their general regulatory body should have to undertake to comply with the Council’s rules concerning professional practice. Thus the Council’s rules, although non-statutory, would apply to all practitioners subject to its governance, irrespective of whether they are members of the Association. If a practitioner does not wish to be subject to those rules, he or she may decide to be governed by the Law Society Council. On the matter of disciplinary bodies having regard to rules and rulings of the Bar Council, we make the same recommendations as we made above in relation to rules and rulings of the Law Society Council.

4.28 As recommended earlier, when the Council makes regulations, or non-statutory rules which are to be binding on non-members of the Association, it should not be subject to direction or restraint by a general meeting, or any other organ, of the Association.

Powers of the Governor

4.29 As we have indicated earlier, ¹ we are of the view that in order to protect the public interest and to ensure consistency and fairness as between practitioners who are subject to different general regulatory bodies, the Governor should have certain powers in relation to the making of statutory regulations. We consider that any regulations made by the general regulatory bodies should be subject to the approval of the Governor. This presently applies in relation to solicitors. We also consider that the Governor should have certain powers to make regulations concerning the legal profession. We summarise our views on that matter in the following two paragraphs.

4.30 Should the Governor have a broad power to make regulations concerning the legal profession? As has been mentioned, since 1980 the Governor has had a general power to make regulations under the Legal Practitioners Act, including the power to make regulations concerning “professional practice, conduct and discipline”, in relation to solicitors. ¹ The Governor has extensive powers to make regulations in relation to several other professions in New South Wales, although they are not expressed in such broad terms as those under the Legal Practitioners Act. ² Subject to the same qualification, the position is similar in places such as South Australia and Queensland in relation to the Governor’s powers to make regulations concerning solicitors or (in South Australia, for example) legal practitioners generally. ³ The vesting of a broad power in the Governor, similar to that which presently exists in relation to solicitors, would be of particular value to prevent unfairness or confusion arising between practitioners due to a conflict between regulations or rules made by the Law Society Council and the Bar Council. Mr Gressier is of the view that a broad power of this kind should be exercisable only on the recommendation of the Bar Council or the Law Society Council. Mr. Disney and Judge Martin do not favour the exercise of the power being confined by law in such a way. But they envisage that, as a matter of practice, the power would not usually be exercised otherwise than in pursuance of recommendations made to the Attorney General by the Bar Council, the Law Society Council or the Public Council on Legal Services, the creation of which we recommend in chapter 5. They consider that the vesting of this power in the Governor is a necessary consequence of our earlier recommendations, first, that there should continue to be two general regulatory bodies (with the consequent possibility of unfair or inappropriate distinctions being drawn between practitioners who are subject to different bodies) and, secondly, that those bodies should be the governing Councils of professional associations rather than being independent statutory bodies.

4.31 All three of us consider that in relation to specified matters the Governor should have power to make regulations without being subject to any requirement of prior recommendation by the Law Society, the Bar Council or the Public Council on Legal Services. We illustrate such matters by reference to powers which the Governor already has, by virtue of s.87(1)(a)-(d) of the Legal Practitioners Act, to make regulations concerning solicitors. These include, for example, the power to prescribe the proportion of a solicitors lowest annual trust account balance which must be deposited with the Law Society.

Regulation-Making Procedures

4.32 Regulations made by the Law Society Council may have considerable effect on practitioners who are subject to the Bar Council, and vice versa. Two practitioners who practise in precisely the same style may be subject to different councils. In order to assist the making of regulations which have due regard to the interests of all practitioners, and which do not give rise to inappropriate distinctions between practitioners, we consider that, in general, the Councils should consult with each other before sending regulations to the Attorney General for the approval of the Governor. We do not recommend that such consultation should be required by statute, but we do recommend that when a Council sends regulations to the Attorney General for the approval of the Governor it should be required to send them at the same time to the other Council. Mr Disney and Judge Martin consider that the Attorney General should then be under a statutory obligation, subject to an exception for emergencies, to give the other council an opportunity to express its views to him or her about the proposed regulations. Mr Gressier, however, considers that although this procedure would usually be desirable it should not be mandatory.

4.33 We have recommended that the Governor should have some powers to make regulations in relation to the legal profession. In our view, it will usually be desirable for the general regulatory bodies to be given an opportunity to consider and comment on regulations which the Attorney General intends to propose to the Governor. Indeed, Mr Disney and Judge Martin are of the view that this procedure should be required by statute, subject to an exception for emergencies.

4.34 In chapter 5 we recommend the creation of a Public Council on Legal Services, and we make recommendations about its role in the making of regulations.

Annual Reports

4.35 Under the regulatory system recommended in this Report, Parliament would delegate to the Law Society Council and the Bar Council the principal responsibility for regulation of the profession in the public interest. It would give them extensive powers for that purpose. In our view, it is appropriate for the two Councils to have both the right and the duty to report annually to Parliament on the manner in which they have carried out the role given to them by Parliament. The Governor should be given power to prescribe particular matters relevant to a Council’s work which must be dealt with in its Annual Reports. We note that a somewhat similar requirement to report was recommended by the Professional Organisations Committee in Ontario. ¹

D. THE RIGHT TO PRACTISE

I. Practising Certificates

4.36 As we have mentioned earlier, solicitors must obtain a practising certificate if they wish to practise as such. ¹ There is, however, no analogous requirement in relation to barristers. A requirement that practitioners must hold practising certificates serves valuable purposes. For example, there are many obligations which it may be appropriate to place upon a lawyer who wishes to have the right to practise, but which are inappropriate for one who does not wish to practise. These include obligations to serve a period as an employee or pupil of another practitioner before practising as a principal, to contribute to the cost of regulation of the practising profession, to take out indemnity insurance, and to serve a further period as an employee or pupil if returning to practise after some years out of active practice. These and other obligations presently apply to solicitors who wish to have the right to practise. ² For reasons which we shall give later in this Report ³ and in subsequent Reports, we consider that analogous obligations should apply to barristers who wish to have the right to practise. This requires some means, Such as a practising certificate system, for distinguishing between practitioners who have a right to practise and those who do not.

4.37 Another advantage of a practising certificate system is that it can be used as the means by which practitioners indicate the general regulatory body to which they wish to be subject, and it can enable that body to obtain certain details of practitioners and their practices which are important for administration and as a statistical basis for policy formulation. A practising certificate system is also a convenient way of implementing disciplinary orders to the effect that a practitioner is to be suspended from practice or is to be restricted in the way in which he or she may practise. In our Second Report on the Legal Profession, we recommend that disciplinary authorities should have wide powers to make such orders, and that, as is presently the case in relation to solicitors, they should be implemented through a practising certificate system. ¹

4.38 The Law Society has submitted to us that practising barristers should be required to have practising certificates and should have to join the Bar Association. This would mean that they would become subject, for example, to the Association’s requirements concerning membership fees and pupillage. ¹ The Bar Association has submitted that admission as a barrister should be confined to those who undertake to practise as a barrister and to join the Association. ² We have said earlier, however, that we do not favour compelling practitioners to join the Law Society or the Bar Association. Moreover, we do not favour the Association’s suggestion that admission as a barrister should depend upon an undertaking to practise. By comparison with a practising certificate system, such a requirement would bring excessive formality to a transfer from inactive to active status, and would place an undue and inappropriate burden on the Court. It also raises major difficulties in relation to barristers outside private practice.

4.39 These various considerations lead us to recommend that all lawyers should be required to hold practising certificates if they wish to practise. As to the issuing of certificates, it is appropriate that the administrative responsibility should lie with the general regulatory bodies. But for the reasons given in paragraphs 4.21-4.23, we would be opposed to the practising certificates issued by the Bar Council being described as “barristers” certificates, and those issued by the Law Society Council being described as “solicitors” certificates. The requirements for obtaining a practising certificate are of such importance that they should be laid down by Parliament or in regulations. In chapter 6 we make recommendations concerning the requirements for obtaining a practising certificate, and certain rights and obligations of certificate holders. We consider here, however, some issues relating to the fees charged for practising certificates.

II. Practising Certificate Fees

4.40 At present, the fees to be paid by solicitors for their practising certificates are fixed by the Law Society, subject to the approval of the Attorney General. ¹ The fees are paid into the general funds of the Society for expenditure on such matters as it deems appropriate. Payment of the fee entitles the practitioner to membership of the Society. ²

4.41 In our view, practising certificate fees should be devoted solely to regulatory functions, not to non-regulatory functions such as those of a trade union nature. Financial support of the latter activities should not be a condition of being entitled to practise law. Accordingly, we do not consider it appropriate that payment of the practising certificate fee should entitle a practitioner to membership of the Society or association and thus to enjoyment of its services for members, There should be a separate membership fee for those practitioners who do wish to avail themselves of these services.

4.42 Who should fix practising certificate fees? We are inclined to favour vesting this power in the respective general regulatory bodies, provided that the Attorney General’s approval of the proposed fees is required. As we have mentioned, this is the present position in relation to solicitors. The involvement of the Attorney General is appropriate in order to ensure that the fees are not higher than is reasonably necessary to meet the cost of regulatory, as opposed to non-regulatory, functions. This principle may not be capable of precise application, but it is important that, within reasonable bounds, it should be observed. In order to fulfil his or her responsibilities in this respect, the Attorney General will need to have access to detailed information about the income and expenditure of the general regulatory bodies, and he or she should take into account any money which those bodies receive from other sources, such as the Fidelity Fund, in order to defray the expenses of regulation.

4.43 We have said that practising certificate fees should be expended on regulatory functions. Most of these functions are performed by the general regulatory bodies. Accordingly, the bulk of the money received in fees should be allocated to them. But some regulatory functions are performed by other bodies, such as disciplinary tribunals, and it may be appropriate for portion of the revenue from fees to be allocated to them. It is beyond the scope of this Report to make specific recommendations in this respect, save that practising certificate fees should be paid by practitioners to their general regulatory body, and any disbursements by that body to other bodies exercising regulatory functions should be at the direction, or subject to the approval of, the Attorney General.

4.44 Should practising certificate fees vary between practitioners? At present solicitors’ practising certificate fees vary according to certain criteria, the most important of which is whether the solicitor holds a certificate entitling him or her to practise as a principal, rather than one which confines him or her to practising as an employee. There are reductions for solicitors who have been admitted for less than three years, or whose practice is primarily outside New South Wales. There is no reduced fee allowed to part-time practitioners, but the compulsory indemnity insurance premium, which must be paid at the same time as the practising certificate fee, is lower for part-time practitioners. The membership fees of the Bar Association vary quite considerably, being higher for those who are of longer standing at the Bar. Country members, Public Defenders, Crown Prosecutors, and some associate members (some of whom are part-time practitioners or non-practising barristers pay 50% of the fee which would otherwise be payable.

4.45 We confine ourselves to two comments about variations in practising certificate fees. First, we see no justification for requiring that practising certificate fees should be fixed at the same level by both general regulatory bodies. The per capita cost of an appropriate regulatory system may differ considerably between the two bodies. Secondly, there are a number of factors which may justify variations in the fees payable by practitioners who are subject to the same general regulatory body. They include, for example, the demands which certain categories of practitioner (for example, those who hold trust accounts) are likely to place on the resources of their general regulatory bodies. Another factor is the desirability of easing the financial burden on young practitioners. Also, we are inclined to favour some reduction in practising certificate fees for part-time practitioners, especially those, such as some academic lawyers, whose work is done solely or largely for legal aid organisations. These suggestions are illustrative rather than exhaustive.

Para.
4.3	1. For the present system of separate admission, see our Discussion Paper, The Structure of the Profession, Part I, pp.49-50.
	2. See paragraphs 6.7-6.19.
	3. See paragraphs 4.19 and 6.20-6.42.
	4. See, in particular, chapter 6.
4.4	1. See paragraph 7.41.
4.5	1. See Law Society of New South Wales, Submission No.200 (“Division of the Legal Profession into Two Branches”), p.14.
	2. See Barristers Admission Rules; Solicitors Admission Rules; Solicitors Practices Rules, rule 11; Law Society of New South Wales, Submission No.200 (“Division of the Legal Profession into Two Branches”), pp.20-23.
	3. See our Background Paper -IV, Part I.
4.7	1. For discussion of the issues referred to in paragraphs 4.7-4.9, see our Discussion Paper, The Structure of the Profession, Part I, pp.172-174.
	2. See our Background Paper -IV, Part I.
4.8	1. See paragraphs 4.36-4.39.
	2. See Legal Practitioners Act, 1898, ss.40, 40B.
4.10	1. See paragraphs 2.2-2.5 of this Report, and also our Discussion Paper, General Regulation, especially pp.36-43.
4.12	1. See paragraphs i.22-3.26. For a fuller discussion, see our Discussion Papers, General Regulation, pp.119-127, and The Structure of the Profession, Part I, pp.241-242.
4.17	1. For a fuller discussion of issues referred to in paragraphs 4.17-4.20, see our Discussion Papers, General Regulation, pp.162-163, and The Structure of the Profession, Part I, pp.242-247.
4.19	1. See paragraph 4.13.
	2. See paragraph 4.30.
	3. See paragraph 4.13.
4.21	1. See Paragraph 4.5.
4.22	1. See chapters 5, 6, 10 and 13.
4.23	1. For our views concerning usage of the words “barrister and solicitor”, “lawyer” and “legal practitioner”, see paragraphs 4.7-4.9.
4.24	1. See paragraph 2.2.
	2. Legal Practitioners Act, 1898, s.86(1)(a)(iv).
4.29	1. See paragraphs 4.13, 4.19.
4.30	1. See paragraph 2.2
	2. See our Discussion Paper, General Regulation, ch.4.
	3. See paragraph 2.30.
4.35	1. Report (Ontario, 1980) pp.62-64.
4.36	1. For a description of the present position concerning practising certificates, see our Discussion Paper, The Structure of the Profession, Part I, pp.53-54. For a fuller discussion of issues referred to in paragraphs 4.36-4.39, see The Structure of the Profession, Part I, pp.186-187.
	2. See chapter 6, and our Discussion Paper, Professional Indemnity Insurance.
	3. See chapter 6.
4.37	1. See chapters 7 and 8 of that Paper.
4.38	1. See Law Society of New South Wales, Submission No.262 (“Admission and Right to Practice”), pp.14,15.
	2. See New South Wales Bar Association, Submission No.131 (“The Admission and Right to Practice of the Legal Practitioner”), pp.6, 7.
4.40	1. Legal Practitioners Act 1898, s.69.
	2. Id.