Review of the Legal Profession Act Final Report


Forward





FOREWORD

For some years, New South Wales has led the way in the implementation of competition policy reforms to the regulation of the legal profession. Amendments to the Legal Profession Act 1987 in 1993 introduced reforms which included the deregulation of costs, the removal of many formal distinctions between solicitors and barristers, the establishment of the Legal Services Commissioner to handle complaints against solicitors and barristers, the establishment of the Legal Profession Advisory Council to review Rules made by representatives of the profession, and a new scheme for the assessment of costs.

This review has been undertaken with a dual purpose. First, the review was required by the Competition Principles Agreement. Under the Agreement, Governments agree to consider any potentially anti-competitive restrictions in legislation and whether they are in the public interest. Second, a review of the 1993 reforms was required by a provision in the Legal Profession Act.

The review has been undertaken by the Attorney General’s Department, in consultation with a reference group. An issues paper was released in August 1998 and was widely circulated. Advertisements were placed in newspapers, and the issues paper was posted on the Department’s website. Submissions were received from a wide range of sources, including consumer groups, representatives of the profession, courts, government agencies and other regulatory bodies.

This report analyses the impact of those reforms and considers which provisions of the scheme for the regulation of solicitors and barristers may continue to have anti-competitive effects. The Department has found the reforms to have been, for the most part, successful. The report endorses the direction taken by the 1993 reforms, and recommends that reform continue in some important areas, including the business structures which may be chosen by solicitors, and professional indemnity insurance. The report also supports minor changes to the system for dealing with complaints against solicitors and barristers, to facilitate the resolution of complaints about costs or service against solicitors and barristers. A number of other recommendations deal with the fine tuning of the scheme to ensure that the profession is accountable to the public and that regulation serves the public interest.

The report is in two parts. The executive summary sets out the recommendations of the review, in answer to the questions posed in the issues paper. The report follows the summary and explains the rationale for the recommendations.

The report is a starting point for consultation with consumers, the profession, regulators and other members of the community, and is intended to encourage robust debate about the future regulation of the profession. The Government will consider whether and how to implement the recommended changes after the issues have been fully considered by the community, as part of a comprehensive consultative process. No aspect of the report constitutes a preconceived opinion. The process will determine what, if any, further legislation is appropriate.