The Legal Profession Act 2007 (the Act) at Part 3.3 sets out the obligations of law practices, practitioners and principals regarding trust money and trust accounts. One of the main purposes of Part 3.3 is to ensure that trust money is held by law practices in a way that protects the interests of persons for whom money is held.
Breach of the obligations in Part 3.3 of the Act may, in appropriate circumstances, cause the Society to consider whether the responsible practitioner is a fit and proper person to hold a practising certificate and/or whether external intervention in the law practice is warranted. Section 244 of the Act imposes the trust accounting obligations of a law practice upon its Principals
The Act obliges the Society to monitor and enforce compliance with Part 3.3 of the Act. To meet this obligation the Society conducts what the Act calls Part 3.3 Investigations (see s263(5)), which are investigations into ‘the affairs of a law practice’.
‘The affairs of a law practice’ include: -
- all accounts and records required under a relevant law to be kept by the practice or an associate or former associate of the practice;
- other records of the practice or an associate or former associate of the practice;
- any transaction:-
- to which the practice or an associate or former associate of the practice was or is a party; or
- in which the practice or an associate or former associate of the practice has acted for a party.
The Society conducts Part 3.3 Investigations of law practices in Queensland in accordance with s263 and Chapter 6 of the Act and its policy.
The principal purposes of a Part 3.3 Investigation are:-
- to ascertain whether the law practice complies with Part 3.3 of the Act; and
- to detect and prevent defaults in relation to the law practice.
Defaults are defined at s356 of the Act. They are a dishonest misappropriation of trust money or trust property.
After completing a Part 3.3 Investigation a trust account investigator must give a report of the investigation to the Society (s264 of the Act).
The power to consider Part 3.3 Investigation Reports given to the Society is delegated by the Council of the Society to its Professional Conduct Committee (PCC), the Manager, Part 3.3 Investigations (Manager, TAI) and Team Leader, Part 3.3 Investigations (Team Leader, TAI).
If the Part 3.3 Investigation Report states that a breach of the Act has been committed or a default has occurred and the Society is satisfied that the breach or default is wilful or of a substantial nature, the Society may decide that the whole or part of the costs of carrying out the investigation is payable to the Society and may decide the amount payable (s265 of the Act).
The power to make determinations under s265 of the Act is delegated by Council to the Professional Conduct Committee (PCC).
This is Council’s Policy about Part 3.3 Investigations conducted by the Society is available below. It outlines the process followed and what practitioners should expect from that Investigation.