Limitation of Liability Scheme

The Professional Standards Act 2004 (Qld) (the Act) provides for the development by occupational associations of schemes to improve professional standards, protect consumers and limit the civil liability of members. The Queensland Law Society Scheme, which commenced on 1 July 2010, provides for liability caps as follows:

a cap of $1.5m for participating members who were at the relevant time in a law practice consisting of up to and including 20 principals and where the law practice generates total annual fee income for the financial year at the Relevant time of up to and including $10million
a cap of $10m for
- participating members who were at the relevant time in a law practice consisting of greater than 20 Principals; or
- participating members who were at the relevant time in a law practice where the law practice generates total annual fee income for the financial year greater than $10m
at a higher cap, either in all cases or in any specified class or case, subject to approval from QLS.

The limitation of liability scheme is not an insurance scheme but acts to protect practitioners against negligence claims. It's a statutory scheme, enforced by the courts, that caps the amount of damages that can be awarded against a practice in court.

Most practitioners have insurance up to $2m through the QLS/ Lexon Insurance professional indemnity insurance scheme. If, however, they were sued for more than $2m many practices would not have the coverage to protect them from serious financial risk. This scheme protects practices by limiting the damages that can be awarded against them in court to $1.5m.

You can opt to be part of the scheme when renewing your Practising Certificate and membership of the QLS. See the Guide to completing your online renewal.

Who can participate in the scheme?

Full members of the Society who hold a current Queensland Practising Certificate.
Practice employees provided all solicitors in that practice are members of both the scheme and the QLS.
The Scheme operates on a 'one-in, all-in basis' – to gain the full benefit of a cap, all solicitors within a firm would have to be members of both the QLS and the scheme.

Important notice:

The Queensland Law Society Limitation of Liability Scheme does not apply to incorporated legal practices (as separate entities) or to personal injury work. Members are strongly encouraged to read the Guide to the Queensland Law Society Limitation of Liability Scheme and the addition below in relation to these and other exemptions, claims aggregations, claims-made insurance versus occurrence-based schemes and other areas of concern.

For members of the scheme

More information on the scheme

Forms