Parker, Christine --- "Regulation of the Ethics of Australian Legal Practice: Autonomy and Responsiveness" [2002] UNSWLawJl 38; (2002) 25(3) UNSW Law Journal 676

[*] Senior Lecturer, Law Faculty, University of Melbourne.

[1] These controls are often referred to collectively as the rules of ‘professional conduct’ or the ‘law of lawyering’. They have their origins in the 19^th century, and earlier.

[2] The comparative analysis of different regulatory controls for the legal profession in this paper was inspired by David Wilkins, ‘Who Should Regulate Lawyers?’ (1992) 105 Harvard Law Review 799. See also David Wilkins, ‘Special Issue — Institutional Choices in the Regulation of Lawyers: Afterword: How Should We Determine Who Should Regulate Lawyers? Managing Conflict and Context in Professional Regulation’ (1996) 65 Fordham Law Review 465. Wilkins divided enforcement/regulatory controls for the legal profession into four categories: (1) disciplinary controls (traditional self-regulation); (2) liability controls (negligence etc); (3) institutional controls (enforced by courts and state administrative agencies on lawyers who practise before them); (4) legislative controls (enforced by a special independent regulator or commission, or even by the government). Wilkins’s analysis leaves out institutional controls enforced by employers of lawyers, including private employers and also government employers. It also leaves out legislative controls by general regulators that can also have some application to the legal profession and law firms (for example competition and consumer protection regulators, anti-discrimination regulators). It also makes no reference to entry requirements, although these are generally included with disciplinary controls. This paper revisits and adjusts my earlier analysis of regulatory controls for the legal profession in Christine Parker, Just Lawyers (1999) 140–73. In particular, I have revised my opinion on the value of reforms in New South Wales that maintained elements of the traditional model of regulation of lawyers.

[3] This paper does not argue the case that a more responsive ethic is appropriate. That case has been argued cogently and frequently elsewhere. See, eg, David Luban, Lawyers and Justice: An Ethical Study (1988); Justin Oakley and Dean Cocking, Virtue Ethics and Professional Roles (2001); William Simon, The Practice of Justice: A Theory of Lawyers ’ Ethics (1998). Rather, this paper takes as its starting point that proposed reforms have been intended (consciously or not) to achieve a more responsive ethic of legal practice.

[4] Some of the more comprehensive and significant reform proposals have included: Access to Justice Advisory Committee, Access to Justice: An Action Plan (1994); Law Reform Commission of Victoria, Access to the Law: Accountability of the Legal Profession, Report No 48 (1991); New South Wales Law Reform Commission, First Report on the Legal Profession: General Regulation and Structure, Report No 31 (1982) and Second Report on the Legal Profession: Complaints, Discipline and Professional Standards, Report No 32 (1982); Trade Practices Commission, Study of the Professions: Legal: Final Report (1994). For more comprehensive accounts of the various reforms proposed and implemented see Freek Bruinsma, Christine Parker and Ed Shinnick, ‘Regulatory Reform of Legal Professions — Australia, Ireland and the Netherlands’, International Journal of the Legal Profession, forthcoming (copy on file with author); Christine Parker, ‘Converting the Lawyers: The Dynamics of Competition and Accountability Reform’ (1997) 33 The Australian and New Zealand Journal of Sociology 39; Christine Parker, ‘Justifying the New South Wales Legal Profession’ [1997] NewcLawRw 1; (1997) 2(2) Newcastle Law Review 1; Stan Ross, ‘Prospects for Structural and Economic Integration of the Australian Legal Profession’ (1997) 4 International Journal of the Legal Profession 267; David Weisbrot, ‘Competition, Cooperation and Legal Change’ [1993] LegEdRev 1; (1993) 4 Legal Education Review 1.

[5] The most dramatic recent examples have included barristers evading tax debts through bankruptcy and a commercial law firm helping its tobacco company client to destroy documents that might provide evidence of its liability. Both have resulted in specific reforms to the regulation of the legal profession in New South Wales and then followed in other States. See below Parts III(D), IV for further discussion.

[6] For accounts of how this model developed historically see Julian Disney et al, Lawyers (1986) 6; William S Holdsworth, A History of English Law (2^nd ed, 1937) vol VI, 443.

[7] See Stephen Brint, In an Age of Experts: The Changing Role of Professionals in Politics and Public Life (1994).

[8] For leading analyses of the social bargain underpinning lawyers’ self-regulation see Terence Halliday, Beyond Monopoly: Lawyers, State Crises, and Professional Empowerment (1987); Alan Paterson, ‘Legal Ethics: Its Nature and Place in the Curriculum’ in Ross Cranston (ed), Legal Ethics and Professional Responsibility (1995) 175. See Christine Parker, Just Lawyers, above n 2, 140–7 for a critique of the social bargain approach. The legal profession’s monopoly on legal practice is legislatively entrenched in Australia.

[9] For descriptions and critiques of the traditional theory see Robert Gordon, ‘The Independence of Lawyers’ (1988) 68 Boston University Law Review 1; Luban, Lawyers and Justice: An Ethical Study, above n 3, 3–10; Simon, above n 3, 7–8; Richard Wasserstrom, ‘Lawyers as Professionals: Some Moral Issues’ (1975) 5 Human Rights 1.

[10] David Luban, ‘Twenty Theses on Adversarial Ethics’ in Helen Stacy and Michael Lavarch (eds), Beyond the Adversarial System (1999) 134, 140 (emphasis in original).

[11] For an excellent summary of these duties and their enforcement see Justice David Ipp, ‘Lawyers’ Duties to the Court’ (1998) 114 Law Quarterly Review 63. However in general the lawyer’s duty to the court and when it will override the duty to the client is not adequately specified: see Australian Law Reform Commission, Managing Justice: A Review of the Federal Civil Justice System, Report No 89 (2000) [3.85]–[3.92].

[12] See R v Birks (1990) 19 NSWLR 677 for judicial recognition of this division of responsibility between lawyer and client.

[13] This raises a moral problem known as the ‘agency paradox’: both the agent and the principal feel they are able to disclaim responsibility for the agent’s actions. The result is that the agent (that is the lawyer) is less constrained by broader principles of ethics in acting in the principal’s (client’s) interests than either the principal or the agent would be were they acting on their own behalf. As one commentator has noted,

[t]oo often, lawyers assume that clients would do anything lawful to prevail, while clients rely on their lawyers’ judgment on the propriety of their tactics. The attorney–client relationship thus fosters mutual avoidance of responsibility, making it easier for lawyers to use professional rules unethically with a clear conscience.

John Leubsdorf, ‘Using Legal Ethics to Screw Your Enemies and Clients’ (1998) 11 Georgetown Journal of Legal Ethics 831, 836–7. See also David Wilkins, ‘Everyday Practice is the Troubling Case: Confronting Context in Legal Ethics’ in Austin Sarat et al (eds), Everyday Practices and Trouble Cases (1998) 68, 73–4.

[14] Contrast this with Shaffer’s ‘ethics of care’: Thomas Shaffer and Robert Cochran, Lawyers, Clients and Moral Responsibility (1994); and Luban’s ‘moral activism’: Luban, Lawyers and Justice: An Ethical Study, above n 3.

[15] But not if the lawyer is a barrister bound by the ‘cab-rank rule’ which requires barristers to accept all clients in their area of practice on a first come, first served basis if the barrister is available and the client can pay the appropriate fee and certain other exceptions (mostly concerned with avoiding conflicts of interest) do not apply. See, eg, The Victorian Bar, Practice Rules (effective 1 July 2002) rr 86–1 07, <http://www.vicbar.com.au/pdf/Current%20Bar%20Rules.pdf> at 23 November 2002.

[16] See Gino Dal Pont, Lawyers’ Professional Responsibility in Australia and New Zealand (1996) 30. See ch 2 of this work for a summary of the legislative regimes in the various Australian States. This paper will not cite legislative provisions for every Australian jurisdiction to support every statement about the regulatory requirements as this information is readily available in Dal Pont’s excellent survey of the law of professional responsibility.

[17] See Re Davis [1947] HCA 53; (1947) 75 CLR 409 and Ex parte Lenehan [1948] HCA 45; (1948) 77 CLR 403 on dishonesty and criminal misconduct. See Re B [1981] 2 NSWLR 372 on disregard for the law and legal institutions.

[18] Re Del Castillo [1998] ACTSC 131; (1998) 136 ACTR 1, 7.

[19] It has even been suggested that this may be a particular disincentive to indigenous law graduates seeking admission to the profession: Kevin Dolman, ‘Indigenous Lawyers: Success or Sacrifice?’ [1997] IndigLawB 69; (1997) 4(4) Indigenous Law Bulletin 4.

[20] Re B [1981] 2 NSWLR 372, 402 (Helsham CJ in Eq).

[21] Dal Pont, above n 16, 32–3. See also Re Del Castillo [1998] ACTSC 131; (1998) 136 ACTR 1, 7.

[22] The only ongoing regulation of lawyers’ competence is a requirement to attend a certain number of hours of continuing legal education requirement in most States.

[23] See Christine Parker, Just Lawyers, above n 2, 13–17. See also William Felstiner, ‘Professional Inattention: Origins and Consequences’ in Keith Hawkins (ed), The Human Face of Law (1997) 121. See also the discussion of ‘consumer controls’ below Part III(C).

[24] See Re W C Mosley [1925] NSWStRp 17; (1925) 25 SR (NSW) 174. Mere incompetence or deficiency in professional service is still not sufficient to amount to professional misconduct: see Pillai v Messiter (No 2) (1989) 16 NSWLR 197. Similarly, only gross overcharging was sufficient to amount to professional misconduct: see Veghelyi v The Law Society of New South Wales (Unreported, Supreme Court of New South Wales, Kirby P, Mahoney and Priestley JJA, 6 October 1995).

[25] Only very recently have some Australian courts indicated that they will enforce these duties more proactively: see, eg, Supreme Court of New South Wales, Practice Note No 108: Costs Orders Against Practitioners (2000).

[26] See Ken Crispin, ‘Prosecutorial Ethics’ in Stephen Parker and Charles Sampford (eds), Legal Ethics and Legal Practice: Contemporary Issues (1995) 171; Steve Bolt and Jane Mussett, ‘The Tim Anderson Decision: The Chief Justice Cites the System’ (1991) 16 Legal Services Bulletin, 126. Similarly, despite judicial criticism of lawyers’ behaviour in bringing an unfounded action for a collateral business advantage in White Industries v Flower and Hart [1998] FCA 806; (1998) 156 ALR 169 (Federal Court)[1999] FCA 773; , (1999) 163 ALR 744 (Full Federal Court), no disciplinary action has been initiated against any lawyer for their conduct in this case.

[27] Mostly the inherent jurisdiction has been exercised reactively where another party (usually a Bar Association) has made an application to discipline a lawyer on more traditional grounds of professional misconduct such as dishonesty.

[28] See Ipp, above n 11. Other courts also have these powers by virtue of their legislation and court rules.

[29] Dal Pont, above n 16, 594.

[30] See ibid 147 ff for an overview.

[31] Law Society of NSW v Harvey [1976] 2 NSWLR 154.

[32] Clark Boyce v Mouat (1993) 3 NZLR 641 (PC); Steven Fennell, ‘Conflicts of Interest: Clark Boyce v Mouat’ (1994) 10 Professional Negligence 22.

[33] See Dal Pont, above n 16, 149–50. Lawyers’ responsibilities in relation to trust accounts and client funds are usually exhaustively specified in separate rules and regulations, although they are essentially a species of fiduciary or equitable obligation.

[34] See ibid, 163–4. This is particularly true where the conflict of interest is between the lawyer and the client.

[35] Indeed, while in the case of successive (though not concurrent) client conflict it is theoretically possible for a practitioner to act if the former client waives confidentiality (because no duty of loyalty is owed to the former client), some courts (notably the Family Court) may take the view that it is, notwithstanding the waiver, improper for a practitioner to continue to act because of the appearance of conflict and the damage this does to the public perception of the integrity of the profession.

[36] Carindale Country Club Estate Pty Ltd v Astill [1993] FCA 218; (1993) 42 FCR 307, 310–11.

[37] See Elizabeth Nosworthy, ‘Conflicts of Interest’ from ‘Ethics and Large Law Firms’ in Stephen Parker and Charles Sampford (eds), Legal Ethics and Legal Practice: Contemporary Issues (1995) 57; Roman Tomasic, ‘Chinese Walls, Legal Principle and Commercial Reality in Multi-Service Professional Firms’ [1991] UNSWLawJl 4; (1991) 14 University of New South Wales Law Journal 46. Contrast the view of Adrian Evans, ‘The Business of Conflicts’ [2000] LawIJV 373; (2000) 74(10) Law Institute Journal 23.

[38] See Richard Tur, ‘Legal Ethics, Overview’ in Ruth Chadwick (ed), Encyclopedia of Applied Ethics (1998) for an important analysis of the consequences in family law practice. See Clark Boyce v Mouat [1993] NZLR 641 where the Privy Council had to determine to what extent a client was able to consent to a conflict of interest where she was to share a solicitor with her son for whom she was going guarantor.

[39] See, eg, Debra Lamb’s analysis of her interviews with Australian lawyers about ethical problems they had faced. Conflicts of interest were the single most common dilemma and one that more than half her sample believed arose frequently and even ‘almost on a daily basis’: Debra Lamb, ‘Ethical Dilemmas: What Australian Lawyers Say About Them’ in Stephen Parker and Charles Sampford (eds), Legal Ethics and Legal Practice: Contemporary Issues (1995) 217, 222. See also Susan Shapiro, Tangled Loyalties: Conflict of Interest in Legal Practice (2002) which compares lawyers’ awareness of conflicts of interest favourably with other professions on the basis of extensive interview data.

[40] See Evidence Act 1995 (Cth) and Evidence Act 1995 (NSW) ss 118–119 for a statement of the privilege. See Deane J in Attorney-General (NT) v Maurice [1986] HCA 80; (1986) 161 CLR 475, 490 for a statement of the rationale of the privilege.

[41] See the examples and following discussion given in Deborah Rhode, In the Interests of Justice: Reforming the Legal Profession (2000) 106–15 (‘Confidentiality’ chapter). See also Simon, above n 3, 54–62.

[42] See Paul Finn, ‘Professionals and Confidentiality’ [1992] SydLawRw 22; (1992) 14 Sydney Law Review 317; Karen Koomen, ‘Breach of Confidence and the Public Interest Defence: Is it in the Public Interest? A Review of the English Public Interest Defence and the Options for Australia’ [1994] QUTLawJl 4; (1994) 10 Queensland University of Technology Law Journal 56.

[43] Finn, above n 42, 323.

[44] Law Council of Australia, Model Rules of Professional Conduct and Practice (2002) r 3.

[45] See Attorney-General (NT) v Kearney & Northern Land Council [1985] HCA 60; (1985) 158 CLR 500 where the privilege did not protect legal advice from disclosure where the advice was intended to help a government department fail to comply with the requirements of administrative law.

[46] By contrast the American Bar Association recently attempted to revise its rules of ethics to permit lawyers to disclose client secrets to prevent fraud, injury or death. The revision proposals were only partially successful. See William Glaberson, ‘Lawyers Considering Easing Restriction on Client Secrecy’, The New York Times (New York), 31 July 2001, 1; Jonathan Glater, ‘Lawyers May Reveal Secrets of Clients, Bar Group Rules’, The New York Times, (New York), 8 August 2001, 12.

[47] See Gerald Postema, ‘Moral Responsibility in Professional Ethics’ (1980) 55 New York University Law Review 63.

[48] Luban, ‘Twenty Theses on Adversarial Ethics’, above n 10, 134, 152. There are many alternatives to the role morality of the adversarial advocate proposed by various ethicists. But David Luban’s is probably the leading one. Elsewhere Luban states that a morally activist approach might also lead a lawyer to devote themselves to public interest lawyering and law reform activity: Luban, Lawyers and Justice: An Ethical Study, above n 3, 171.

[49] Groom v Crocker [1939] 1 KB 194. See Dal Pont, above n 16, 99. Stephen Charles, ‘Professional Liability and Lawyers’ (1988) 4 Australian Bar Review 222, 236 points out that the very early history of actions against attorneys treated the liability as in tort. However cases after 1885 were quite unequivocal that the liability was in contract only. At common law, barristers had no contractual capacity, and therefore even liability in contract is an advance upon the strictures of the most traditional model which saw no direct mechanism for a client to enforce a lawyer’s obligations. This is now remedied by legislative provision: eg, Legal Profession Act 1987 (NSW) s 38L.

[50] [1963] UKHL 4; (1964) AC 465.

[51] Astley v Austrust Ltd (1999) 197 CLR 1. Cf Hawkins v Clayton (1988) 164 CLR 539, 574, 584 (Deane J) suggesting that it was unnecessary to imply such a term into the contract if there is liability in tort. See also Aviva Freilich, ‘Contributory Negligence and Breach of Contract: The implications of Astley v Austrust Ltd’ (2000) 29 Western Australian Law Review 18.

[52] However note that in practice contractual liability itself has been heavily influenced by many public policy considerations in recent times: see Hugh Collins, Regulating Contracts (1999). Lawyers’ contracts of retainers are not immune from this trend — see discussion of disclosure requirements below Part III(C).

[53] See David Partlett, ‘Roaming in the Gloaming: The Liability of Professionals’ [1992] SydLawRw 20; (1992) 14 Sydney Law Review 261.

[54] Hawkins v Clayton (1988) 164 CLR 539; Hill v Van Erp (1997) 188 CLR 159. See Reid Mortensen, ‘Solicitors’ Will-Making Duties’ [2002] MelbULawRw 4; (2002) 26 Melbourne University Law Review 60 for a comprehensive analysis of these cases.

[55] Stephen Corones, ‘Solicitors’ Liability for Misleading Conduct’ (1998) 72 Australian Law Journal 775. See also Tahche v Abboud [2002] VSC 42 (Unreported, Smith J, 1 March 2002) in which it was held that a prosecutor can be liable in tort for misfeasance in public office for breach of prosecutors’ special duties of disclosure. This decision was reversed by the Court of Appeal, Victorian Supreme Court: Cannon and Rochford v Tahche [2002] VSCA 84; [2002] Aust Torts Reports 81-669.

[56] However, as I shall argue below Part III(C), the signals from individual negligence cases may be rather unclear compared with the more precise guidance that can be provided in legislation or codes of practice etc.

[57] Giannarelli v Wraith (1988) 165 CLR 543. The ‘intimately connected’ test was set out in Rees v Sinclair [1974] 1 NZLR 180, 187. It was adopted by the House of Lords in Saif Ali v Sydney Mitchell & Co [1980] AC 198 and applied in Australia in Keefe v Marks (1989) 16 NSWLR 713.

[58] The House of Lords recently abolished the immunity in Arthur J S Hall v Simons [2000] UKHL 38; [2000] 3 WLR 543. Some members of the High Court of Australia, most strongly Kirby J, indicated that they were willing to restrict the immunity in Boland v Yates Property Corporation [1999] HCA 64; (2000) 167 ALR 575. See Belinda Baker and Desmond Manderson, ‘Advocate’s Immunity: Boland v Yates Re-opens Case Against Counsel’s Immunity’ (2001) 39(11) Law Society Journal 74.

[59] Lawyer incompetence may occasionally amount to a miscarriage of justice in criminal cases: R v Birks (1990) 19 NSWLR 677.

[60] In the 2000–01 reporting year, the number of written complaints was 28.9 per cent of the total of 9110 calls to the inquiry line. This means that up to 71.1 per cent of complaints or inquiries were resolved by informal advice over the phone, educational material sent out to inquirers or simple action such as a phone call to the lawyer involved: Office of the Legal Services Commissioner, Annual Report 2000– 2001 (2001) 5, <http://www.lawlink.nsw.gov.au/olsc1.nsf/pages/ar2000_2001_mission> at 17 November 2002.

[61] Thirty one point four per cent of complaints were referred to the Law Society of NSW or NSW Bar Association in 2000–01: ibid.

[62] However in Victoria at least, the Legal Practice Act 1996 (Vic) s 64 does set out the ‘general principles of professional conduct’ that should be ‘reflected’ in these codes. Under s 77, the Legal Practice Board may disallow practice rules that are inconsistent with the Act including s 64.

[63] In other states the ombudsman mostly reviews self-regulation by the legal professional associations. Recent reform proposals suggest that other states should follow the NSW model: Chris Merritt, ‘Patmore Moving to Control Complaints’, Australian Financial Review (Sydney), 16 November 2001, 49 (Tasmania); Marcus Priest, ‘Law Society May Lose Power on Ethics’, Australian Financial Review (Sydney), 11 September 2001, 50; Peter Sallman and Richard Wright, Regulation of the Victorian Legal Profession: Report of the Review of the Legal Practice Act 1996 (2001), <http://www.justice.vic.gov.au/CA2569020010922A/All/1BA6982D1F141D14CA256C13007855E8?OpenDocument & 1=Resources~ & 2=Publications~ & 3=Review+of+Regulation+of+the+Legal+Profession+in+Victoria+-+Final+Report~> at 17 November 2002. See also Peter Cerexhe, ‘Leashing the Lawyers’ (2001) 88 Consuming Interest 26.

[64] ‘Consumer disputes’ can be referred to mediation instead of or in addition to disciplinary action, but only with the consent of the lawyer: Legal Profession Act 1987 (NSW) ss 143–7. In fact the OLSC has asked for powers to force lawyers to mediation and to award modest amounts of compensation in the latest round of reform consultations in NSW: Office of the Legal Services Commissioner, OLSC Submission to the NSW Law Reform Commission Review of Part 10 of the Legal Profession Act 1987 Final Submission (2000) [6.4] <http://www.lawlink.nsw.gov.au/olsc1.nsf/pages/olsclrcsubmission_title> at 17 November 2002; NSW Law Reform Commission, Lawyers and Complaints: Review of Part 10, Issues Paper 18 (2000).

[65] Compensation is usually only ordered where it is easy to calculate, eg, fees paid or disbursements.

[66] See Department of Industry, Science and Tourism, Benchmarks for Industry-Based Customer Dispute Resolution Schemes (1997). See Rhoda James and Mary Seneviratne, ‘The Legal Services Ombudsman: Form Versus Function?’ (1995) 58 Modern Law Review 187 for a comparison of the English Legal Services Ombudsman against the criteria established by the British and Irish Ombudsman Association. As they point out, an ‘ombudsman’ that performs only a review function, as most legal services ombudsman offices in Australia do, is not really an ombudsman at all as it provides no effective grievance resolution mechanism and few remedies. The Australian Banking Industry Ombudsman is widely considered to be a fairly successful consumer dispute resolution scheme: see Ruth Campbell, ‘Australian Banking Industry Ombudsman Scheme: the First 10 Years’ (2001) 16 Australian Banking and Finance Law Bulletin 123.

[67] See Corporations Act 2001 (Cth) s 912A(1)(g); Australian Securities and Investments Commission, Policy Statement 139: Approval of External Dispute Resolution Schemes (1999); Australian Securities and Investments Commission, Policy Statement 165: Licensing: Internal and External Dispute Resolution (2001).

[68] See Dal Pont, above n 16, 587 for a summary.

[69] Allinson v General Medical Council [1894] UKLawRpKQB 36; [1894] 1 QB 750, 761 (Lord Esher), 763 (Lopes LJ) (emphasis added).

[70] Both Victorian and NSW legislation use this phrase: Legal Profession Act 1987 (NSW) s 137(3); Legal Practice Act 1996 (Vic) s 137 (emphasis added).

[71] Legal Profession Act 1987 (NSW) ss 139, 171D.

[72] In Victoria the debate has been particularly heated; see, eg, Katherine Towers, ‘Ombudsman Raises Profession’s Hackles’, Australian Financial Review (Sydney), 1 December 2000, 44; Katherine Towers, ‘Fresh Attack on Vic Ombudsman’, Australian Financial Review (Sydney), 2 February 2001, 47; Chris Merritt, ‘Proposed System a Step Backwards: Hamond’, Australian Financial Review (Sydney), 30 November 2001, 51; Ashley Crossland, ‘Proposed System Would Silence Critics: Ombudsman’, Australian Financial Review (Sydney), 3 August 2002, 51.

[73] In a number of states the ombudsman offices are asking for more proactive, regulatory powers such as those exercised by the Australian Competition and Consumer Commission and ASIC. See Office of the Legal Services Commissioner, above n 64, [3.18]–[3.33]; Marcus Priest, ‘Nimmo Seeks Greater Role’, Australian Financial Review (Sydney), 9 November 2002, 51 (Queensland); Kate Hamond, ‘Watchdog Bites Back at Critics of Her Investigations’, Australian Financial Review (Sydney), 15 December 2000, 29 (Victoria). The Tasmanian Attorney-General is considering similar reforms; see Merritt, ‘Patmore Moving to Control Complaints’, above n 63. The Queensland Attorney-General has warned the solicitors’ association that its response to current investigations will determine whether it will keep its self-regulatory powers: Sam Strutt, ‘Former Judge to Scrutinise Law Society’, Australian Financial Review (Sydney), 14 August 2002, 10.

[74] See Department of Industry, Science and Tourism, above n 66.

[75] Some reforms to empower consumers have also been included in self-regulatory guidance or codes of conduct issued by the legal professional associations.

[76] See Angus Corbett, ‘A Proposal for a More Responsive Approach to the Regulation of Corporate Governance’ (1995) 23 Federal Law Review 277 for a similar analysis of the use of negligence-type provisions for directors’ duties.

[77] See Dal Pont, above n 16, 76–7, 348–9 for a summary of the relevant ‘client care’ and costs disclosure rules. NSW, Queensland, Tasmania and Victoria have disclosure requirements to various extents enshrined in legislation.

[78] Legal Profession Act 1987 (NSW) pt 4; Legal Practice Act 1996 (Vic) pt 4.

[79] However in NSW the government has recently legislated to ban all advertising for personal injuries work except for a statement setting out the name and contact details and legal practitioner’s areas of specialty in print and Internet publications: Legal Profession Amendment (Advertising) Regulation 2002 (NSW). The Queensland government has passed similar reforms to ban ‘no win, no fee’ advertising and the Western Australian government has proposed similar reforms: Sam Strutt, ‘Queensland Passes Public Liability Reform Law’, Australian Financial Review (Sydney), 21 June 2002, 16. These reforms are partially in response to the perceived crisis in negligence litigation, but also because ‘no win, no fee’ advertising has prompted many consumer complaints in relation to the charging of disbursements and uncertainty about what counts as ‘no win’.

[80] See Department of Industry, Science and Tourism, Guidelines for the Advertising of Legal Services (1996).

[81] Summary of Law Society of New South Wales, Client Care Guideline to Best Practice (1996), quoted in Ysaiah Ross and Peter MacFarlane, Lawyers’ Responsibility and Accountability (2002) [8.4]. In the same paragraph Ross and MacFarlane report that the Law Society of Queensland has promulgated a similar guideline.

[82] Office of the Legal Services Commissioner, Annual Report 1996–1997 (1997) 49–52.

[83] Legal Practice Act 1996 (Vic) s 86. In addition to information about costs, the lawyer must disclose to the client in writing: (a) the name of the practitioner who will primarily provide the legal services and whether they are a principal or employee; (b) the client’s right to request a written progress report; (c) the avenues open to a client in the event of a dispute or complaint in relation to either costs or the provision of legal services; and (d) the name and address of the regulatory body for the lawyer.

[84] See Avrom Sherr, Client Care for Lawyers (1999); Patrick Stevens, Keeping Clients: A Client Care Guide for Solicitors (1997).

[85] Office of the Legal Services Commissioner, above n 60, 5.

[86] Legal Ombudsman Victoria, Annual Report 2000–2001 (2001).

[87] Trade Practices Commission, above n 4.

[88] Frederick Hilmer, Moira Rayner, and Geoffrey Taperell, National Competition Policy (The Hilmer Report) (1993).

[89] For a summary see Bruinsma, Parker and Shinnick, above n 4.

[90] Legal Profession Act 1987 (NSW) ss 186–8; Legal Practice Act 1996 (Vic) ss 97–9. Note that the amount to be paid to the legal practitioner cannot be calculated as a percentage of the amount recovered in proceedings.

[91] See, eg, Conveyancers Licensing Act 1995 (NSW). In some states, including Victoria and South Australia, lay conveyancers were already permitted to compete with lawyers.

[92] Competition Policy Reform Act 1995 (Cth) (and corresponding legislation in other States and Territories). See Stephen Corones, ‘Solicitors Subject to Trade Practices Act’ (1996) 16(6) Proctor 10.

[93] Law Council of Australia, Blueprint for the Structure of the Legal Profession: A National Market for Legal Services (1994); Daryl Williams, ‘Competition Law and the (Legal) Profession(s) — A Commonwealth View’ in Commonwealth of Australia, Can the Professions Survive Under a National Competition Policy? (1997) 1 (A joint conference on competition law and the professions, Perth, 11 April 1997).

[94] Law Council of Australia, Submission to the Standing Committee of Attorneys-General: Towards National Practice (2001). The Commonwealth Attorney-General has made it clear he wants nationally uniform professional conduct rules; see Chris Merritt, ‘Williams Gets Tough on States’, Australian Financial Review (Sydney), 8 March 2002, 51.

[95] McCabe v British American Tobacco Australia Services Ltd [2002] VSC 73 (Unreported, Eames J, 22 March 2002); Chris Merritt, ‘Crackdown on Document Shredding’, Australian Financial Review (Sydney), 2 August 2002, 1, 55; Chris Merritt, ‘Call for Ethics Debate After BAT Case’, Australian Financial Review (Sydney), 2 August 2002, 55.

[96] A number of reforms that had been proposed and then left to languish in the doldrums since the 1970s and 1980s were finally implemented. The introduction of the Victorian Legal Ombudsman and the NSW Legal Services Commissioner are the most important examples. In both cases, the State government was prompted to legislate to stave off potential federal legislation. See above n 4.

[97] Andrew Goldsmith and Guy Powles, ‘Lawyers Behaving Badly: Where now in legal education for acting responsibly in Australia?’ in Kim Economides (ed), Ethical Challenges to Legal Education and Context (1998), 119, 126.

[98] Access to Justice Advisory Committee, Access to Justice: An Action Plan (1994).

[99] Allan Fels, ‘Regulation, Competition and the Professions’ (2001) (Paper presented to Industry Economics Conference, Melbourne, 13 July 2001); Hilmer, Rayner and Taperell, above n 88.

[100] See McCabe v British American Tobacco Australia Services Ltd [2002] VSC 73 (Unreported, Eames J, 22 March 2002); White Industries (Qld) Pty Ltd v Flower & Hart [1998] FCA 806; (1998) 156 ALR 169; (1999) 87 FCR 134 (Full Court); Supreme Court of New South Wales, Practice Note No 108: Costs Orders Against Practitioners (2000). See also the Civil Liability Act 2002 (NSW) sch 2, introducing the new Legal Profession Act 1987 (NSW) s 198J which says that lawyers must refrain from providing legal services where they do not ‘reasonably believe on the basis of provable facts and reasonably arguable view of the law’ that the claim or defence has ‘reasonable prospects of success’: see J S, ‘Ethical Threshold for Litigation’ (2002) 27 Alternative Law Journal 193.

[101] Justice Geoffrey Lance Davies, ‘Fairness in a Predominantly Adversarial System’ in Helen Stacy and Michael Lavarch (eds), Beyond the Adversarial System (1999) 102; Stephen Parker, ‘Islands of Civic Virtue: Lawyers and Civil Justice Reform’ (1997) 6 Grifith Law Review 1.

[102] In addition to its interest in removing further restrictive practices in the legal profession (see Fels, above n 99), the Australian Competition and Consumer Commission is also taking action against lawyers who are knowingly involved in contraventions of the Trade Practices Act by their clients: ACCC v Real Estate Institute of Western Australia (1999) 95 FCR 114; ACCC v David Charles Miller (Unreported, Federal Court of Australia, 21 April 1999) (case disposed of by consent order. See Australian Competition and Consumer Commission, ‘Action Against Lawyer Highlights Risk for Legal Profession’ (Press Release, 7 May 1999, MR 54/99)).

[103] See Fiona McLeod, ‘Equality of Opportunity for Women at the Bar: The Victorian Bar Council’s Response’ (1999) 12 Australian Feminist Law Journal 111; Katherine Towers, ‘Victoria Forces Law Firms to Toe New Guidelines’, Australian Financial Review (Sydney), 22 March 2002, 58 (firms must commit to equal opportunity obligations in order to be able to tender for provision of legal services to the Victorian government).

[104] Solicitors’ provision of investment services are now subject to the managed investment provisions of the Corporations Act 2001 (Cth) and regulation by ASIC.

[105] See, eg, NSW Bar Association v Cummins [2001] NSWCA 284 (Unreported, Spigelman CJ, Mason P and Handley JA, 31 August 2001).

[106] After heated debate, the NSW Attorney-General promulgated the Legal Profession Regulation 1994 (NSW), regs 69B, 69C to prohibit unlawful discrimination (including sexual harassment) by lawyers in legal practice and require them to complete a certain number of continuing legal education hours on equal employment opportunity and unlawful discrimination. For further discussion of this debate and other initiatives to eliminate gender-based discrimination in the profession see Christine Parker, ‘Justifying the New South Wales Legal Profession’, above n 4, 19–20. In NSW, lawyers must now disclose any tax offences they have committed and bankruptcies to their self-regulatory organisations and these may have disciplinary consequences: Legal Profession Act 1987 (NSW) pt 3, div 1AA. Other jurisdictions are likely to follow suit: see Law Council of Australia, Model Rules of Professional Conduct and Practice, r 31.

[107] Chris Arup and Kathy Laster (eds), For the Public Good: Pro Bono and the Legal Profession in Australia (2001) 19 Law In Context (Special Issue); David Weisbrot, Report of the National Pro Bono Taskforce and Recommended Action Plan (2001), <http://www.ag.gov.au/aghome/commaff/fllad/legal_aid/finalreport/finalreport.html> at 17 November 2002; Towers, above n 103 (firms must commit to pro bono and equal opportunity obligations in order to be eligible to tender for government legal services).

[108] Recently governments, especially the NSW government, have added particular professional conduct rules in reaction to particular scandals of barristers using bankruptcy to avoid tax, lawyers advising document shredding and sexual harassment.

[109] Richard Ackland, ‘Time to Stop Fudging About Bankrupts at the Bar’, Sydney Morning Herald (Sydney), 2 March 2001, 12; Paul Barry, ‘Rich Lawyers Dodging Income Tax’, Sydney Morning Herald (Sydney), 26 February 2001, 1; Ruth McColl, ‘Disclosure Will Give Barristers’ Watchdog a Real Bite’, Sydney Morning Herald (Sydney), 2 March 2001, 12.

[110] Christine Parker, ‘Converting the Lawyers: The Dynamics of Competition and Accountability Reform’, above n 4, 39.

[111] I have previously argued that companies and other large organisations should be made responsible to implement internal programs to ensure they comply with regulation and are responsive to social responsibilities. Similar principles could be applied to law firms, other employers of lawyers and lawyers’ associations: Christine Parker, The Open Corporation (2002).

[112] See Ted Schneyer, ‘A Tale of Four Systems: Reflections on How Law Influences the “Ethical Infrastructure” of Firms’ (1998) 39 South Texas Law Review 245; Julian Webb and Donald Nicolson, ‘Institutionalising Trust: Ethics and the Responsive Regulation of the Legal Profession’ (1998) 2 Legal Ethics 148, 161. For a specific proposal along these lines see Stephen Parker, above n 100, 1.

[113] See Christine Parker, The Open Corporation, above n 111 for a detailed analysis of organisational self-regulation in general as a way of making organisations permeable to democratic regulation and social values.