Legal Profession Act 2004 No 112
Current version for 4 July 2014 to date (accessed 23 November 2014 at 16:48)
Chapter 6

Chapter 6 Provisions relating to investigations

Part 6.1 Preliminary

657   Primary purpose of Chapter

(1)  The primary purpose of this Chapter is to provide powers that are exercisable in connection with:
(a)  trust account investigations—the investigation of the affairs of law practices under Division 3 of Part 3.1 (Trust money and trust accounts), and
(b)  trust account examinations—the external examination of the trust records of law practices under Division 4 of Part 3.1, and
(c)  complaint investigations—the investigation of complaints under Chapter 4 (Complaints and discipline), and
(d)  compliance audits—the conduct of audits under section 670 in relation to law practices.
Note. This Chapter also applies in relation to matters under Division 7 of Part 2.4 (see section 77) and matters under Division 7 of Part 2.7 (see section 217).
(2)  Subsection (1) does not limit the operation of any other provision of this Chapter.

658   Definitions

In this Chapter:

complaint investigation—see section 657 (1) (c).

compliance audit—see section 657 (1) (d).

investigator means:

(a)  an investigator under Division 3 of Part 3.1, or
(b)  an external examiner under Division 4 of Part 3.1, or
(c)  an investigator or independent investigator under Chapter 4, or
(d)  in relation to a compliance audit—the person appointed by the Law Society Council or the Commissioner under section 670 to conduct the audit.

trust account examination—see section 657 (1) (b).

trust account investigation—see section 657 (1) (a).

Part 6.2 Requirements relating to documents, information and other assistance

659   Requirement to provide access to documents and information relating to affairs of law practice

(1)  This section applies to the following activities:
(a)  trust account investigations,
(b)  trust account examinations,
(c)  complaint investigations,
(d)  compliance audits.
(2)  For the purpose of carrying out an activity to which this section applies in relation to a law practice, an investigator may, on production of evidence of his or her appointment, require the practice or an associate or former associate of the practice or any other person (including, for example, an ADI, auditor or liquidator) who has or has had control of documents relating to the affairs of the practice to give the investigator either or both of the following:
(a)  access to the documents relating to the affairs of the practice that the investigator reasonably requires,
(b)  information relating to the affairs of the practice that the investigator reasonably requires (verified by statutory declaration if the requirement so states).
(3)  A person who is subject to a requirement under subsection (2) must comply with the requirement.

Maximum penalty: 50 penalty units.

(4)  A person who is subject to a requirement under subsection (2) is not entitled to charge the investigator for giving any such access or information.

660   Requirements in relation to complaint investigations

(1)  For the purpose of carrying out a complaint investigation in relation to an Australian lawyer, an investigator may, by notice served on the lawyer, require the lawyer to do any one or more of the following:
(a)  to produce, at a specified time and place, any specified document (or a copy of the document),
(b)  to provide written information on or before a specified date (verified by statutory declaration if the requirement so states),
(c)  to otherwise assist in, or co-operate with, the investigation of the complaint in a specified manner.
(2)  For the purpose of carrying out a complaint investigation in relation to an Australian lawyer, the investigator may, on production of evidence of his or her appointment, require any associate or former associate of a law practice of which the lawyer is or was an associate or any other person (including, for example, an ADI, auditor or liquidator but not including the lawyer) who has or has had control of documents relating to the affairs of the lawyer to give the investigator either or both of the following:
(a)  access to the documents relating to the affairs of the lawyer the investigator reasonably requires,
(b)  information relating to the affairs of the lawyer the investigator reasonably requires (verified by statutory declaration if the requirement so states).
(3)  A person who is subject to a requirement under subsection (1) or (2) must comply with the requirement.

Maximum penalty: 50 penalty units.

(4)  A requirement imposed on a person under this section is to be notified in writing to the person and is to specify a reasonable time for compliance.
(5)  A person who is subject to a requirement under subsection (1) or (2) is not entitled to charge the investigator for doing anything in compliance with the requirement.

Part 6.3 Entry and search of premises

661   Application of Part and interpretation

(1)  This Part applies to the following investigations:
(a)  trust account investigations,
(b)  complaint investigations.
(2)  In this Part:

relevant material, in relation to an investigation to which this Part applies, means any information, document or other material that:

(a)  an investigator reasonably requires for the purposes of the investigation, and
(b)  relates, or may relate, to the subject matter of the investigation.

662   Investigator’s power to enter premises

(1)  For the purpose of carrying out an investigation to which this Part applies, an investigator may enter and remain on any premises to exercise the powers referred to in section 664.
(2)  In the case of a trust account investigation, the investigator:
(a)  may enter any premises, other than residential premises, without the need for consent or a search warrant, and
(b)  may enter residential premises:
(i)  at any time with the consent of the occupier, or
(ii)  under the authority of a search warrant issued under this Part, or
(iii)  at any time without the consent of the occupier and without a warrant, but only if the investigator believes, on reasonable grounds, that it is urgently necessary to do so in order to prevent the destruction of or interference with any relevant material.
(3)  In the case of a complaint investigation, the investigator may enter any premises:
(a)  at any time with the consent of the occupier, or
(b)  under the authority of a search warrant issued under this Part.
(4)  The investigator must not exercise the power referred to in subsection (2) (b) (iii) unless the appropriate Council or the Commissioner has authorised the investigator (orally or in writing) to do so.
(5)  The investigator must, at the reasonable request of a person apparently in charge of the premises or any other person on the premises, produce evidence of his or her appointment.

663   Search warrant

(1)  An investigator may apply to an authorised officer for the issue of a search warrant for premises if the investigator believes on reasonable grounds that any relevant material is located at the premises.
(2)  An authorised officer to whom such an application is made may, if satisfied that there are reasonable grounds for doing so, issue a search warrant authorising an investigator named in the warrant:
(a)  to enter and inspect the premises, and
(b)  to exercise on the premises the powers referred to in section 664 (Powers of investigator while on premises).
(3)  Division 4 of Part 5 of the Law Enforcement (Powers and Responsibilities) Act 2002 applies to a search warrant issued under this section.
(4)  In this section:

authorised officer has the same meaning as in the Law Enforcement (Powers and Responsibilities) Act 2002.

664   Powers of investigator while on premises

(1)  An investigator who enters premises under this Part may exercise any or all of the following powers:
(a)  search the premises and examine anything on the premises,
(b)  search for any relevant material,
(c)  operate equipment or facilities on the premises for a purpose relevant to the investigation,
(d)  take possession of any relevant material and retain it for as long as may be necessary to examine it to determine its evidentiary value,
(e)  make copies of any relevant material or any part of any relevant material,
(f)  seize and take away any relevant material or any part of any relevant material,
(g)  use (free of charge) photocopying equipment on the premises for the purpose of copying any relevant material,
(h)  with respect to any computer or other equipment that the investigator suspects on reasonable grounds may contain any relevant material:
(i)  inspect and gain access to a computer or equipment,
(ii)  download or otherwise obtain any documents or information,
(iii)  make copies of any documents or information held in it,
(iv)  seize and take away any computer or equipment or any part of it,
(i)  if any relevant material found on the premises cannot be conveniently removed, secure it against interference,
(j)  request any person who is on the premises to do any of the following:
(i)  to state his or her full name, date of birth and address,
(ii)  to answer (orally or in writing) questions asked by the investigator relevant to the investigation,
(iii)  to produce relevant material,
(iv)  to operate equipment or facilities on the premises for a purpose relevant to the investigation,
(v)  to provide access (free of charge) to photocopying equipment on the premises the investigator reasonably requires to enable the copying of any relevant material,
(vi)  to give other assistance the investigator reasonably requires to carry out the investigation,
(k)  do anything else reasonably necessary to obtain information or evidence for the purposes of the investigation.
(2)  Any documents, information or anything else obtained by the investigator may be used for the purposes of the investigation.
(3)  If an investigator takes anything away from the premises, the investigator must issue a receipt in a form approved by the appropriate Council or the Commissioner and:
(a)  if the occupier or a person apparently responsible to the occupier is present, give it to him or her, or
(b)  otherwise, leave it on the premises in an envelope addressed to the occupier.
(4)  An investigator may be accompanied by any assistants the investigator requires, including persons with accounting expertise and persons to assist in finding and gaining access to electronically stored information.
(5)  A person requested to do anything under subsection (1) (j) must not, without reasonable excuse, fail to comply with the request.

Maximum penalty: 50 penalty units.

Part 6.4 Additional powers in relation to incorporated legal practices

665   Application of Part

This Part applies to:
(a)  a trust account investigation, or
(b)  a complaint investigation, or
(c)  a compliance audit,
that is conducted in relation to an incorporated legal practice.

666   Powers relating to investigations and audits to which this Part applies

An investigator conducting an investigation or audit to which this Part applies may exercise the powers set out in this Part.

667   Examination of persons

(1)  The investigator, by force of this section, has and may exercise the same powers as those conferred on the Australian Securities and Investments Commission by Division 2 of Part 3 of the Australian Securities and Investments Commission Act 2001 of the Commonwealth.
(2)  Division 2 of Part 3 of the Australian Securities and Investments Commission Act 2001 of the Commonwealth applies to the exercise of those powers, with the following modifications (and any other necessary modifications):
(a)  a reference to the Australian Securities and Investments Commission (however expressed) is taken to be a reference to the investigator,
(b)  a reference to a matter that is being or is to be investigated under Division 1 of Part 3 of that Act is taken to be a reference to a matter that is being or is to be investigated, examined or audited by the investigator,
(c)  a reference in section 19 of that Act to a person is taken to be a reference to an Australian legal practitioner or an incorporated legal practice,
(d)  a reference to a prescribed form is taken to be a reference to a form approved by the Law Society Council and the Commissioner,
(e)  any modifications prescribed by the regulations.
(3)  Sections 22 (2) and (3), 25 (2) and (2A), 26 and 27 of the Australian Securities and Investments Commission Act 2001 of the Commonwealth do not apply in respect of the exercise of the powers conferred by this section.

668   Inspection of books

(1)  The investigator, by force of this section, has and may exercise the same powers as those conferred on the Australian Securities and Investments Commission by sections 30 (1), 34 and 37–39 of the Australian Securities and Investments Commission Act 2001 of the Commonwealth.
(2)  Those provisions apply to the exercise of those powers, with the following modifications (and any other necessary modifications):
(a)  a reference to the Australian Securities and Investments Commission (however expressed) is taken to be a reference to the investigator,
(b)  a reference to a body corporate (including a body corporate that is not an exempt public authority) is taken to be a reference to an incorporated legal practice,
(c)  a reference to an eligible person in relation to an incorporated legal practice is taken to be a reference to an officer or employee of the incorporated legal practice,
(d)  a reference to a member or staff member is taken to be a reference to:
(i)  the Law Society Council or a person appointed by the Council who is an officer or employee of the Council, or
(ii)  the Commissioner or a person appointed by the Commissioner who is a member of staff of the Commissioner,
(e)  a reference in section 37 of that Act to a proceeding is taken to be a reference to an investigation, examination or audit to which this Part applies,
(f)  any modifications prescribed by the regulations.

669   Power to hold hearings

(1)  The investigator may hold hearings for the purposes of an investigation or audit to which this Part applies.
(2)  Sections 52, 56 (1), 58, 59 (1), (2), (5), (6) and (8) and 60 (paragraph (b) excepted) of the Australian Securities and Investments Commission Act 2001 of the Commonwealth apply to a hearing, with the following modifications (and any other necessary modifications):
(a)  a reference to the Australian Securities and Investments Commission (however expressed) is taken to be a reference to the investigator,
(b)  a reference to a member or staff member is taken to be a reference to:
(i)  the Law Society Council or a person appointed by the Council who is an officer or employee of the Council, or
(ii)  the Commissioner or a person appointed by the Commissioner who is a member of staff of the Commissioner,
(c)  a reference to a prescribed form is taken to be a reference to a form approved by the Law Society Council and the Commissioner,
(d)  any modifications prescribed by the regulations.

Part 6.5 Miscellaneous

670   Compliance audit of law practice

(1)  The Law Society Council or the Commissioner may cause an audit to be conducted of the compliance of a law practice (and of its officers and employees) with the requirements of this Act, the regulations or the legal profession rules.
(2)  Without limiting subsection (1), an audit conducted in relation to an incorporated legal practice may include an audit of:
(a)  the compliance of the incorporated legal practice with the requirements of Part 2.6, and
(b)  the management of the provision of legal services by the incorporated legal practice (including the supervision of officers and employees providing the services).
Note. Section 140 (3) (Incorporated legal practice must have legal practitioner director) requires legal practitioner directors to ensure that appropriate management systems are implemented and maintained.
(3)  The Law Society Council or the Commissioner may, in writing, appoint a suitably qualified person to conduct an audit under this section.
(4)  The appointment may be made generally or for the audit of a law practice specified in the instrument of appointment.
(5)  An audit under this section may be conducted whether or not a complaint has been made against an Australian lawyer.
(6)  A report of an audit under this section:
(a)  is to be provided to the law practice concerned, and
(b)  is to be provided by the Law Society Council to the Commissioner or by the Commissioner to the Law Society Council (as the case may be), and
(c)  may be provided by the Law Society Council or the Commissioner to any regulatory authority in another jurisdiction, and
(d)  may be taken into account in connection with any disciplinary proceedings taken against a legal practitioner or other persons or in connection with the grant, amendment, suspension or cancellation of Australian practising certificates.
(7)  Nothing in this section authorises the conduct of an audit in relation to a barrister.

671   Failure to comply with investigatory powers etc

(1)  The failure of an Australian legal practitioner to comply with any requirement made by an investigator in the exercise of powers conferred by this Chapter is professional misconduct.
(2)  The contravention by an Australian legal practitioner of any condition imposed by an investigator in the exercise of powers conferred by this Chapter is capable of being professional misconduct.
(3)  The failure of a legal practitioner director of an incorporated legal practice to ensure that the incorporated legal practice, or any officer or employee of the incorporated legal practice, complies with:
(a)  any requirement made by an investigator in the exercise of powers conferred by this Chapter, or
(b)  any condition imposed by an investigator in the exercise of powers conferred by this Chapter,
is capable of being professional misconduct.

672   General provisions relating to requirements imposed under this Chapter

(1)  This section applies to any requirement imposed on a person under this Chapter.
(2)  The validity of the requirement is not affected, and the person is not excused from compliance with the requirement, on the ground that a law practice or Australian legal practitioner has a lien over a particular document or class of documents.
(3)  The investigator imposing the requirement may:
(a)  inspect any document provided pursuant to the requirement, and
(b)  make copies of the document or any part of the document, and
(c)  retain the document for a period the investigator thinks necessary for the purposes of the investigation in relation to which it was produced.
(4)  The person is not subject to any liability, claim or demand merely because of compliance with the requirement.
(5)  The appropriate Council:
(a)  may on its own initiative, or
(b)  must if directed to do so by the Commissioner,
suspend a local legal practitioner’s practising certificate while a failure by the practitioner to comply with the requirement continues.
(6)  If a document:
(a)  is not in writing, or
(b)  is not written in the English language, or
(c)  is not decipherable on sight,
a requirement under this Chapter to provide access to the document is not complied with unless access is provided to a statement, written in the English language and decipherable on sight, that contains all the information in the document.
(7)  A Council may retain any copy of a document or part of a document made by an investigator under this Chapter and provided to the Council under this Chapter.

673   Report to Commissioner of disciplinary matters

If an investigator becomes aware of any matter in the course of a trust account investigation, trust account examination, complaint investigation or compliance audit that the investigator thinks may be unsatisfactory professional conduct or professional misconduct on the part of an Australian legal practitioner or Australian-registered foreign lawyer, the investigator must, unless the matter is or has already been the subject of a complaint under Chapter 4, refer the matter to the Commissioner to consider whether disciplinary action should be taken against an Australian legal practitioner or Australian-registered foreign lawyer.

674   Obstruction or misleading of investigator

(1)  A person must not, without reasonable excuse, obstruct or mislead an investigator exercising a power under this Act.

Maximum penalty: 100 penalty units.

(2)  In this section:

obstruct includes hinder, delay, resist and attempt to obstruct.

675   Destruction of evidence

A person must not, with intent to prevent, hinder or otherwise interfere with the carrying out of a trust account investigation, trust account examination, complaint investigation or compliance audit, and whether before or after the appointment of an investigator, destroy, conceal, remove from one place to another or deliver into the possession, or place under the control, of another person any information or document that may provide evidence of a contravention of this Act, the regulations or the legal profession rules.

Maximum penalty on indictment: imprisonment for 5 years.

676   Obligation of Australian lawyers

(1)  The duties imposed on an Australian lawyer by this section are additional to obligations imposed under other provisions of this Chapter, whether or not the lawyer is the subject of the investigation, examination or audit concerned.
(2)  An Australian lawyer must not mislead an investigator or a Council in the exercise of:
(a)  any power or function under this Chapter, or
(b)  any power or function under a provision of a corresponding law that corresponds to this Chapter.
(3)  An Australian lawyer who is subject to:
(a)  a requirement under section 660 (Requirements in relation to complaint investigations), or
(b)  a requirement under provisions of a corresponding law that correspond to that section,
must not, without reasonable excuse, fail to comply with the requirement.
(4)  An Australian lawyer who contravenes subsection (2) or (3) is guilty of professional misconduct.

677   Permitted disclosure of confidential information obtained in course of investigation, examination or audit

(1)  A Council, the Commissioner or an investigator may disclose information obtained in the course of a trust account investigation, trust account examination, complaint investigation or compliance audit to any of the following:
(a)  any court, tribunal or other person acting judicially,
(b)  the Attorney General,
(c)  any authority regulating legal practitioners in any jurisdiction,
(d)  any officer of or Australian legal practitioner instructed by:
(i)  any authority regulating legal practitioners in any jurisdiction, or
(ii)  the Commonwealth or a State or Territory of the Commonwealth, or
(iii)  an authority of the Commonwealth or of a State or Territory of the Commonwealth,
in relation to any proceedings, inquiry or other matter pending or contemplated arising out of the investigation, examination or audit,
(e)  an investigative or prosecuting authority established by or under legislation (for example, the Australian Securities and Investments Commission),
(f)  a police officer—if the Council, the Commissioner or the investigator suspects on reasonable grounds that the information relates to an offence that may have been committed by:
(i)  if a law practice is the subject of the investigation, examination or audit—the law practice or an associate or former associate of the law practice, or
(ii)  if an Australian lawyer is the subject of the investigation, examination or audit—the lawyer or an associate or former associate of the law practice of which the lawyer is or was an associate,
Note. Section 730A requires a Council to report suspected offences to the relevant law enforcement or prosecution authority.
(g)  if the subject of the investigation, examination or audit is or was:
(i)  a law practice—a principal of the law practice, or
(ii)  an incorporated legal practice—a director or shareholder in the practice, or
(iii)  an Australian lawyer—the lawyer or a principal of the law practice of which the lawyer is or was an associate,
(h)  if the subject of the investigation, examination or audit is or was:
(i)  a law practice—a client of the practice, or
(ii)  an Australian lawyer—a client of the law practice of which the lawyer is or was an associate,
but only if the information relates to the client,
(i)  if the subject of the investigation, examination or audit is or was:
(i)  a law practice—a supervisor, manager or receiver appointed in relation to the law practice, or
(ii)  an Australian lawyer—a supervisor, manager or receiver appointed in relation to the law practice of which the lawyer is or was an associate,
or an Australian legal practitioner or accountant employed by the supervisor, manager or receiver,
(j)  an investigator carrying out another investigation, examination or audit in relation to the law practice or Australian lawyer who is or was the subject of the investigation, examination or audit,
(k)  any other person to the extent that it is necessary for the purposes of properly conducting the investigation, examination or audit and making a report on the matter.
(2)  A reference in subsection (1) to information obtained in connection with any such investigation, examination or audit includes a reference to any finding, opinion or recommendation of the investigator in relation to the investigation, examination or audit.
(3)  No liability (including liability in defamation) is incurred by a protected person in respect of anything done or omitted to be done in good faith for the purpose of disclosing information under this section.
(4)  For the purposes of subsection (3):

protected person means any of the following:

(a)  the Law Society or Bar Association,
(b)  a Council or a member of a Council,
(c)  the Commissioner,
(d)  an investigator,
(e)  a member of staff of or a person acting at the direction of any person or entity referred to in this definition.

678   Secrecy of appointment of investigators

(1)  An investigator must not make an unauthorised disclosure of his or her appointment as an investigator.

Maximum penalty: 20 penalty units.

(2)  Subsection (1) is not contravened if the investigator is making a requirement under Part 6.2 or is complying with a request under section 662 (5).
(3)  A member of the Law Society Council or an employee or agent of the Law Society must not make an unauthorised disclosure of the appointment of an investigator.

Maximum penalty: 20 penalty units.

(4)  For the purposes of this section, a disclosure of the appointment of an investigator is unauthorised if it is made to a person other than a person to whom the disclosure of information obtained in the course of the investigation, examination or audit to which the appointment relates is authorised under section 677.
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