(1) Money received for or on behalf of any person by a licensee in connection with the licensee’s conveyancing business:(a) is to be held by the licensee or (if the licensee is employed by a corporation) by the corporation, exclusively for that person, and(b) is to be paid to the person or disbursed as the person directs, and(c) until so paid or disbursed, is to be paid into and retained in a trust account (whether general or separate) at an authorised deposit-taking institution in New South Wales and approved by the Director-General for the purposes of this Part.(2) If the licence is held by a corporation, the trust account is to be in the name of the corporation and in any other case is to be in the name of the licensee or of the firm of licensees of which the licensee is a member.(3) Subsection (1) does not prevent a licensee from:(a) withdrawing or receiving, from trust money, money due to the licensee for costs so long as the procedure prescribed by the regulations is followed, and(b) holding, or disposing of, a cheque or other negotiable instrument payable to a third party if the licensee does so on behalf of a client and in accordance with directions given by the client, and(c) exercising a general retaining lien for unpaid costs and disbursements in respect of money in a trust 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).(4) A lien referred to in subsection (3) (c):(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:(i) the licensee has disclosed to the client, in accordance with Division 5 of Part 3, the basis of the costs for the conveyancing work concerned, or(ii) if such a disclosure is not required to be made (as provided by sections 39 and 40 and any relevant regulations)—the licensee has served a bill of costs on the client.(5) The name of a trust account and the description of the trust account in the books and records of the licensee and also on all cheques drawn on the trust account:(a) must include the name of the licensee corporation, licensee or firm of licensees in whose name the trust account is kept, and(b) must include the words “Trust Account”, and(c) may include, at the end of the account’s name, a name or other matter to identify the person on whose behalf money in the account is held.(6) When opening a trust account at an authorised deposit-taking institution for the purpose of complying with this section, the licensee concerned must ensure that the authorised deposit-taking institution is notified in writing that the account is a trust account required by this Act.(7) A licensee must, within 14 days after closing a trust account, notify the Director-General in writing of the closure.
Maximum penalty: 100 penalty units.