New South Wales Repealed Acts

This legislation has been repealed.

LEGAL PROFESSION ACT 1987 - SECT 61

61 Money received by solicitor on behalf of another

(1) A solicitor who, in the course of practising as a solicitor in this State, receives money on behalf of another person:

(a) must pay the money, within the time prescribed by the regulations, into a general trust account in New South Wales at an approved financial institution and must hold the money in accordance with the regulations relating to trust money, or

(b) if the person on whose behalf the money is received directs that it be paid or delivered to a third party free of the solicitor’s control, must ensure that the money is paid or delivered:

(i) before the end of the next working day or, if that is not practicable, as soon as practicable after the next working day, or

(ii) no later than the day allowed by the solicitor’s authority or instructions (if that day is later than the day allowed under subparagraph (i)), or

(c) if the person on whose behalf the money is received directs that it be paid otherwise than into a general trust account or to a third party, must pay the money as directed and (if the money is to be held under the direct or indirect control of the solicitor) must hold the money in accordance with the regulations relating to controlled money.

(2) In any of those three cases, the solicitor must hold the money exclusively for, and must disburse the money in accordance with the directions of, the person on whose behalf it is held.

(3) This section:

(a) does not prevent a solicitor from depositing money with the Law Society in compliance with section 64, but this section continues to apply to any money so deposited that is repaid to the solicitor, and

(b) does not prevent a solicitor from withdrawing or receiving, from trust money or controlled money:

(i) reimbursement for disbursements paid by the solicitor, or

(ii) money for disbursements to be paid by the solicitor, or

(iii) money due, or to accrue due, to the solicitor for costs,

so long as the procedure prescribed by the regulations is followed, and

(c) does not affect any enforceable lien or claim that a solicitor has to any money, and

(d) does not prevent a solicitor from exercising a general retaining lien for unpaid costs and disbursements in respect of money in a trust account or a controlled money account (other than money received subject to an express direction by the client with respect to the purposes for which the money is to be applied), and

(e) does not prevent a solicitor from holding, or disposing of, a cheque or other negotiable instrument payable to a third party if the solicitor does so on behalf of a client and in accordance with directions given by the client, and

(f) does not affect an authority that a solicitor has and that, apart from this section, is irrevocable.

(4) A lien referred to in subsection (3) (d):

(a) may not be exercised for an amount in excess of the sum of the costs and disbursements unpaid, and

(b) may not be exercised unless the solicitor has delivered a bill of costs and disbursements to the client on whose behalf the money is held.

(5) Money received by a solicitor on behalf of another person:

(a) is not available for payment to a creditor of the solicitor, and

(b) is not liable to be taken in execution of any judgment, order or other process of any court or tribunal at the instance of a creditor of the solicitor,

unless the creditor is the person on whose behalf the money is held by the solicitor.

(6) If a Crown Solicitor’s Trust Account is established as prescribed by the regulations, this section applies to money received by the Crown Solicitor from a person for whom, or a body for which, the Crown Solicitor acts.

(7) If a trust account kept by a solicitor is, as authorised by or under the regulations, operated on by a person other than the solicitor, section 53 of the Trustee Act 1925 does not apply to the person in relation to the operation on the trust account.

(8) It is professional misconduct for a solicitor to wilfully contravene subsection (1) or (2).

(9) In this section:
"approved financial institution" means a bank, building society or credit union that has an agreement with the trustees of the Public Purpose Fund relating to the payment of interest on general trust accounts (as referred to in section 69E).
"controlled money" means money required to be dealt with in accordance with subsection (1) (c) that, while under the direct or indirect control of the solicitor by whom or on whose behalf it is received, is for the time being held otherwise than in a general trust account at an approved financial institution.
"trust money" means money required to be dealt with in accordance with subsection (1) (a).

(10) A reference in subsection (1) to a third party does not include a reference to an associate of a solicitor.