The risk of inadvertently (or purposefully) engaging in legal practice

September 16, 2024

Take away points

1. Professionals (and others including accountants, tax agents, financial advisors, real estate and business agents and strata consultants/managers) are not entitled to engage in legal practice and, therefore, must take care to not offer advice or services which purposefully or inadvertently amount to engaging in legal practice in contravention of the Legal Profession Uniform Law (LPUL).
2. Disclosing that you are not entitled to engage in legal practice or issuing disclaimers that your opinions should not be relied on as legal advice is not a defence under the LPUL if what you provided is legal advice.
3. It is also not a defence under the LPUL, as it was previously in Western Australia, that the person not being a Legal Practitioner, who did the legal work was not directly or indirectly remunerated, promised or expected to receive remuneration for that legal work.
4. The maximum penalties for contravention of the LPUL in this regard now include a monetary fine of just under AU$50,000, imprisonment for two years, or both.
5. Professionals (and others) not entitled to engage in legal practice will also likely be uninsured for services provided in contravention of the LPUL. This poses a risk to both the provider and their client in addition to the risk that the legal advice is wrong at law or in context or application.

Legislation

The legal profession in Western Australia has been governed by the LPUL since 1 July 2022.

The LPUL provides that an entity must not engage in legal practice in Western Australia unless it is a qualified entity.

The LPUL also provides that a person is not entitled to recover any money and must repay any money they receive in contravention of the LPUL.

Essentially, subject to the limited covenants in the corresponding Regulations, only Australian Legal Practitioners, law practices and other limited classes of people (such as Australian registered foreign lawyers or foreign lawyers practicing exclusively in the practice of foreign law) can engage in legal practice in Australia.

The objective of these provisions are twofold:

First, to ensure that legal work is carried out only by those who are properly qualified to do so.

Secondly, to protect clients of law practices by ensuring that persons carrying out legal work are entitled to do so.

The LPUL reflects the long established prohibition against a person engaging in unauthorised legal practice.

The term "engage in legal practice" is defined in the LPUL as including:

"includes practise law or provide legal services, but does not include engage in policy work (which, without limitation, includes developing and commenting on legal policy)".

The term "practise law" is not defined in the LPUL. However, the words "legal services" is defined in section 6 to mean:

"work done, or business transacted, in the ordinary course of legal practice"

The definitions most likely include but are not limited to drawing or preparing any deed, instrument or writing relating to or in a manner dealing with or affecting any interest in real or personal estate or any proceedings at law.

"Real or personal estate" essentially means anything capable of being owned including any interest in land.

The LPUL and the various related decisions of the Court should act as a stark reminder and warning for all non-legal professionals (and others) whose ordinary work can venture close to the blurry line of what constitutes engaging in legal practice to not take that risk or put their client's or friends at risk. They should get or advise others to take appropriate legal advice from a lawyer.

Whilst the availability of online documents and services providing or selling legal documents and the rise of artificial intelligence might make it tempting and easier for non-lawyers to offer legal services to their clients or friends, the penalties and potential exposure to claims (for which non-lawyers could find themselves not covered by their professional indemnity insurance) should not be taken lightly.

The best advice is, do not take the risk. Even apparently small things can grow into big things with big consequences and expenses.

Dentons is available to consider and advise you about whether any services you provide, or have provided, could contravene section 10 of the LPUL and to provide advice to your or your clients across its Australian and International offices on the broadest of legal matters.