LSB September 2017

LEGAL PRACTICE
New practice
management course to
be delivered next year
ROSALIND BURKE, DIRECTOR, ETHICS & PRACTICE
So, you’ve completed your two years
of supervised practice, applied to the
Board of Examiners to have your LPEAC
restriction lifted, and have just received
your unrestricted practising certificate.
Congratulations! Where to now?
The lifting of your LPEAC restriction
means that you can consider whether you
want to make the move to being a principal
of a law practice. Whether that is as a
partner of a multi-practitioner law practice,
or as a sole practitioner or barrister, there
is a great deal to consider and learn before
taking the step up.
Your experience as an employed
practitioner is unlikely to have provided
you with the full range of knowledge
required to operate a law practice. The
practice of the law is highly regulated and
it is important that principals know and
understand their regulatory responsibilities
especially in respect of trust money,
costs disclosure, professional indemnity
insurance, practising certificates, and
practice structures.
Employment is also unlikely to have
provided much, if any, understanding
of how to run a business and manage
staff. Basic understanding of financial
management, staff supervision, risk
management, technology options and
business development and marketing is
crucial for anyone seeking to make the step
to law practice principal.
As a law practice principal you are
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THE BULLETIN September 2017
responsible and liable for the provision
of all the services by your law practice
and the actions of your employees
(with some exceptions) in doing so. It is
important that you are aware of the risks.
According to the Legal Profession Conduct
Commissioner’s 2016 Annual Report:
• 56.7% of the complaints received by
him in the 2015/2016 period were
against principals of law practices
(partners, directors, sole practitioners
and barristers);
• the most common complaints
were related to overcharging, delay,
negligence, inappropriate behaviour,
lack of communication and poor matter
management; and
• family law matters accounted for the
largest proportion of total complaints
at 23.1% while succession law matters
came second with 13.9% of complaints.
Figures reported by Law Claims in the
Society's 2016 Annual Report show that,
of the claims made in 2016:
• 23% related to commercial
(transactional) work;
• 19% related to civil litigation;
• 19% related to commercial litigation;
• 15% related to statute barred PI claims;
and
• 11% related to estate matters.
• Commercial (transactional) and
commercial litigation claims accounted
for 36% and 23% of total claims costs
respectively.
Whether that is as a partner of a multipractitioner
law practice, or as a sole practitioner
or barrister, there is a great deal to consider and
learn before taking the step up.
The costs (financial, temporal and
emotional) of complaints and negligence
claims take a heavy toll on law practice
principals. Claims and complaints can be
the result of many factors but it is clear that
some simple preparation of practitioners
stepping from employment to principal
would assist greatly with minimising the risk
of many complaints and claims.
In recognition of the risks involved in
stepping from employment to being a
principal, the regulatory authorities in
New Zealand, Western Australia, Victoria,
New South Wales and the ACT all require
that practitioners complete a practice
management course before becoming a
practice principal.
While the requirement to complete
a practice management course is not
mandatory in South Australia, the Law
Society is in the process of developing
a practice management course that is
focussed on the preparation of employed
practitioners who are taking on principal
roles.
It is envisaged that the course will
provide practical training on regulatory
and operational issues facing law practice
principals, including staff management,
advertising, cash flow, practice management
systems and risk management, as well
as on the supervision of trust money
transactions, identifying ethical dilemmas
and how to respond to them, and client
relationship management. It will include
topics falling under all three required CPD
units. All presenters will be South Australian
based professionals in the relevant fields.
The Society anticipates that the course
will be operational in mid 2018. We look
forward to providing the profession with
full details soon. In the meantime, please
don’t hesitate to contact the Society with
any questions or suggestions. B