THE COUNCIL OF THE LAW SOCIETY OF NEW SOUTH WALES v AUSTRALIAN INJURY HELPLINE LIMITED & ORS

These are proceedings brought by the Law Society of New South Wales against Australian Injury Helpline Limited, MACC Holdings (Aust) Pty Limited and Mr G M Whelan (AIH) seeking injunctive relief under s 720 of the Legal Profession Act 2004. The Society alleges that AIH has advertised the provision of legal services contrary to the Legal Profession Regulation 2005 and has engaged in legal practice or represented that it has engaged in legal practice contrary to ss 14 and 15 of the Act.

AIH’s business is the referring of injured persons to lawyers on a panel maintained by it, obtaining fees for work associated with the referrals, which is undertaken in a manner that enables the successful plaintiff to obtain payment for the work from the unsuccessful defendant by way of a disbursement payable as part of a costs order. This “free” service is advertised on a website of which two versions have been tendered, one which was active at the commencement of the proceedings and the other which was slightly (though significantly) amended during the proceedings. It is not controversial that the websites contain personal injury advertising which would contravene the regulatory prohibition, subject to a qualification which I will discuss in due course. Because of the way in which the website is set up, the substantial arguments are whether the advertisement occurred in New South Wales and whether they advertise legal services to be provided in New South Wales. During the proceedings adjustments were made to the website set up so that, for practical purposes, it is not accessible in New South Wales. As I understand the Society’s present position, if that set up remains unchanged it will not seek injunctive relief in respect of it except to the extent that AIH be ordered not to vary the set up without appropriate notice. However, whether AIH was in breach of the Regulation is still a live issue since AIH maintains that it was not in breach and that no injunctive orders are necessary.

In general, injured persons are encouraged to use AIH and its panel because, AIH claims, the lawyers on its panel are highly specialised in personal injury litigation and such is AIH’s relationship with them, they will conduct the litigation, if undertaken, not only with efficiency but also keeping the client fully informed of each step in the process. Correspondence between AIH and the solicitors and the enquirers and clients indicate that, the Society alleges, taken together, such is the nature of AIH’s involvement that it amounts to conduct that is prohibited under ss 14 and 15 of the Act. The advertising prohibition

For convenience, I have used the earlier form of the website as the template for this discussion. The first page of the website contains pictures of injured persons. The second page of the site contains two “buttons”, one of which is named “New South Wales” and the other “All other States & Territories”. If the former is pressed the website responds with a page stating, “Unfortunately, the law in New South Wales prevents us from making an advertisement to you” and the enquirer can go no further. If the enquirer goes back to the first page and presses the “other States” button, the same result occurs because a cookie has been placed on the enquirer’s computer preventing access to the “other States” pages. A knowledgeable enquirer could, of course, delete the cookie and thus, by then pressing the “other States” button obtain access to those pages. Were this the end of the matter I think that the Society would not have sought relief but, as always in computerland, things are not quite so simple.

It is necessary, regrettably, to descend to some degree into the technical arena. The website has a particular IP address which locates and identifies it. This address was assigned to the website by a company, which for convenience I will call SEO. SEO provides a number of services relating to the Internet including arranging for third parties to provide service space on web servers. SEO has provided website hosting services to AIH for some years. Since mid 2006, the web servers used by SEO for hosting AIH’s website was physically located in the United States. Contained within the website but not directly visible to someone who accesses the website by using AIH’s Internet addresses, the names of which directly correspond with the IP address of the website, are pages or internet files (called HTML files) such as “accident – compensation.html”, “accidents.html”, “attorney.html”, “car – accident.html”, “lawyers.html” and so on, all of which use words likely to be used by a person searching for information about personal injury claims when using a search engine such as Google or Yahoo. The key word is used by the enquirer to define the scope of the search and, when the search is conducted by the search engine, it throws up an index of results which will contain references to pages within particular websites. When, in turn, the results of the search are accessed by the enquirer, he or she might be directed to the main page of the website (in which event the choice between New South Wales and other places prevents further enquiry if the NSW button is pressed) but might well be taken directly to a page within the website which sets out the prohibited information.

It is possible to prevent access to what I might call the internal pages of the website from a search engine by making a technical adjustment which it is not necessary to describe. Indeed, by arrangements between the technical advisers to the parties this is what has now been done, so that a search leading to the website will always ask the user to make a decision regarding his or her location and, if New South Wales is chosen, will prevent further access to the website. This will also occur where an enquirer accesses any results from any search engine on the Internet such as Google, Yahoo or Sensis. Pending determination of this matter the defendants have undertaken not to make modifications which will re-open the now unobtainable access without giving adequate notice to the Law Society.

If the "other States" button is pressed, enquirers are able to access successive pages concerning the assistance which AIH suggests is both free and useful in attempting to obtain compensation for personal injury. The pages of both websites are set out in the appendix to this judgment. It is worth noting at this point that the second page of the "other States" site contains the following – “Notice: This service is not offered for those accidents having some connection with NSW.” This notice is an indication to enquirers, in effect, that legal services in New South Wales are not obtainable through AIH and that the site is not concerned with injuries that had such a connection.

In substance (in relation to the earlier website), the Law Society contends that, because the personal injury compensation information could have been obtained through a search engine which, in some cases, rendered the deflection inoperable, in those cases the advertising occurred where the enquirer is in New South Wales and was prohibited. Leaving aside the possible existence of the clear indication that enquirers in New South Wales could not be assisted, both by the button page and the exclusion on the second page, it seems to me that this contention is correct. The use of search engines such as Google and Yahoo is so widespread and conventional that any page on the internet identifiable by their use and accessible via the Google or similar website must be regarded as available to enquirers wherever they are, even though the site had a bypass mechanism on the “first” of its pages.

Consequently, subject to AIH’s contention that, because the website was not directed to New South Wales enquirers, it should not be regarded as having been published in New South Wales, it seems to me that it was published in New South Wales. I will need to return to this issue in due course. AIH also submits that, if the Regulation is interpreted in accordance with s 12 of the Interpretation Act 1987 as it should be, it has not contravened it, since it does not advertise the availability of legal services in New South Wales.

AIH mounts a more fundamental attack on the advertising case brought against it, however. It contends that cls 34 (1) and (2) of the Regulation are ultra vires the regulation making power conferred by the Act. Is cl 34 of the Regulation ultra vires ?

The Act contains a general regulating-making power in s 738 and a specific regulation-making power concerning “the marketing of legal services” in s 85. These sections are relevantly in the following terms – “738 Regulations (1) The Governor may make regulations, not inconsistent with this Act, for or with respect to any matter that by this Act is required or permitted to be prescribed or that is necessary or convenient to be prescribed for carrying out or giving effect to this Act. (2) Without limiting the generality of subsection (1), the Governor may make regulations for or with respect to matters for or with respect to which legal profession rules have been or may be made. (3) A regulation may create an offence punishable by a penalty not exceeding 100 penalty units, unless another maximum penalty is authorised by another provision of this Act to be included in relation to the offence concerned. … 85 Regulation of advertising and other marketing of services (1) The regulations may make provision for or with respect to regulating or prohibiting conduct by any person that relates to the marketing of legal services, including (without limitation) regulating or prohibiting any of the following: (a) advertising by a barrister or solicitor, (b) advertising by any person for or on behalf of a barrister or solicitor, (c) advertising by any person in connection with the provision of legal services, (d) advertising by any person of services connected with personal injury. (2) The regulations under this section may create an offence punishable by a penalty not exceeding 200 penalty units. (3) The Attorney General may direct a person in writing not to engage in conduct described in the direction if the Attorney General is satisfied that: (a) the conduct contravenes the regulations under this section, and (b) the person has been engaging in conduct of that or a similar kind. … “

Since it is clear that AIH is neither a barrister nor solicitor, its conduct so far as advertising is concerned is governed by sub-division 3 of division 2 of the Regulation. Of particular relevance are the following clauses – “33 Definition of “personal injury advertisement” In this Subdivision, “ personal injury advertisement ” means an advertisement that includes any reference to or depiction of: (a) personal injury, or (b) any circumstance in which personal injury might occur, or any activity, event or circumstance that suggests or could suggest the possibility of personal injury, or any connection to or association with personal injury or a cause of personal injury. 34 Restrictions on personal injury advertisements (1) A person must not publish or cause or permit to be published a personal injury advertisement if the advertisement: (a) advertises or otherwise promotes the availability or use of a barrister or solicitor (whether or not a particular barrister or solicitor) to provide legal services, whether or not that is its purpose or only purpose and whether or not that is its effect or only effect, or (b) includes any reference to or depiction of the recovery of money or a claim for money, or any entitlement to recover money or claim money, in respect of personal injury. Maximum penalty: 200 penalty units. (2) A person must not publish or cause or permit to be published a personal injury advertisement if the person is engaged in a practice involving, or is a party to an agreement, understanding or other arrangement that provides for, the referral of persons to one or more barristers or solicitors for the provision of legal services in connection with the recovery of money, or an entitlement to recover money, in respect of personal injury. Maximum penalty: 200 penalty units. (3) …”

“Advertisement” and “publish” defined in clause 23 as follows – advertisement means any communication of information (whether by means of writing, or any still or moving visual image or message or audible message, or any combination of them) that advertises or otherwise promotes a product or service, whether or not that is its purpose or only purpose and whether or not that is its effect or only effect.” publish means: (a) publish in a newspaper, magazine, journal, periodical, directory or other printed publication, or (b) disseminate by means of the exhibition or broadcast of a photograph, slide, film, video recording, audio recording or other recording of images or sound, either as a public exhibition or broadcast or as an exhibition or broadcast to persons attending a place for the purpose of receiving professional advice, treatment or assistance, or (c) broadcast by radio or television, or (d) display on an internet website or otherwise publicly disseminate by means of the internet, or (e) publicly exhibit in, on, over or under any building, vehicle or place or in the air in view of persons in or on any street or public place, or (f) display on any document (including a business card or letterhead) gratuitously sent or gratuitously delivered to any person or thrown or left on any premises or on any vehicle, or (g) display on any document provided to a person as a receipt or record in respect of a transaction or bet.”

Such is the width of the prohibition that, if unqualified, it would follow that, for example, any television drama in which one character says to another that they should get a lawyer to help them make a claim for personal injury will be an offence under the Regulation if this were presented as good advice. This is because it will be an “personal injury advertisement” which promotes (in the sense of encourages) the use of a lawyer to obtain compensation. Similarly, a discussion in a newspaper about the wisdom of litigants making a claim for personal injury without the assistance of a lawyer, suggesting that lawyers might be a useful resource in this respect would amount to an offence and any discussion on a television news or current affairs programme that implied that lawyers are qualified to assist injured persons to make claims for personal injury and ought to be used renders all those who participated in the programme or publication criminally liable, with the sole exception of the publisher, who is excepted from liability unless the Attorney-General decides otherwise (cl 38, s 85). A lecturer in a university who suggests, for example in a lecture on public policy or corporate management, that personal injury claims are best handled by lawyers, commits an offence as would a lecturer in business studies who suggested to students that personal injury claims made in the course of a business are best handled by lawyers – in these circumstances, the exception in cl 37(c) would provide no defence since it is limited to an “advertisement” relating only to legal education and then in only in the course of the person’s business or functions as a provider of legal eduction and only if the lecture were delivered to lawyers.

It is notorious, of course, that moneys “in respect of personal injury” may be claimed under a multiplicity of insurance policies or employment contracts, quite apart from legal proceedings. Accordingly, any reference to or depiction of such possible claims or entitlements is prohibited, except by an insurer, insurance agent or broker in the ordinary course of that person’s business when the clause does not apply – this would come within one of the exceptions specified in clause 37. However, if the reference were made by anyone other than an insurer, insurance agent or broker then the offence would be committed.

Many other examples of common and hitherto regarded as entirely respectable conduct is rendered criminal if the plain unqualified language of the Regulation is applied.

I come then to consider the extent of the regulation power conferred by the Act.

It seems plain enough that the reference in the Regulation to the “recovery of money”, “a claim for money” or “an entitlement to recover money” must be read in context as meaning the recovery of or claim for money pursuant to some legal right to do so and the “entitlement” must mean a legal entitlement. This, however, does not mean that the power to prohibit the reference to or depiction of these matters is within the regulation-making power of s 738 of the Act. With the exception of s 738(2), which would authorise the control of advertising by lawyers, the control of advertising for legal services by others could not, I think, be “carrying out or giving effect to” the Act. It is no doubt for this reason that s 85 made specific provision for regulations dealing with the marketing of legal services.

In APLA v The Law Society of New South Wales (2005) 224 CLR 322 at 423, Kirby J (who dissented on the outcome) characterised the earlier Legal Profession Regulation 2002 (the language of which was more restrictive in some respects than the language of the present Regulation) in the following excoriating but entirely justified language (omitting references) – “[295] The inhibition on communication is therefore quite remarkable. It would appear to put a legal practitioner in peril of criminal and professional offences were he or she to make a public statement suggesting to an individual, community group or service organisation that legal services might be available to assist a woman subject to domestic violence to obtain an apprehended violence order; to provide advice to a child in relation to sexual abuse; to afford assistance to a person seeking relief for disability discrimination; to aid a woman seeking a visa on the basis of marriage to an Australian citizen where she has suffered domestic violence at the hands of her husband; to provide immigration assistance to persons who might have suffered persecution in their country of nationality; to speak on such subjects to students in a high school legal studies class; to talk to a meeting of community organisations about changes to the law with respect to workers' compensation; to write a letter to a newspaper referring to difficulties faced by lawyers in visiting clients in prisons or mental hospitals; or to submit an article to a legal journal proposing an increase in legal aid in the areas of domestic violence, sexual abuse, disability discrimination and immigration assistance. [296] In short, the Regulation is not the delicate work of a master drafter, seeking by filigreed language to avoid any risks of overreach into constitutional areas where State angels might fear to tread, an option that was open to the Parliament and about which it had been advised[270]. The Regulation is, instead, a legal blunderbuss. It fires its shots at everything within range and beyond. It does so with a scattergun effect – indifferent to any distinction that might exist by reference to rights, privileges and procedures afforded by, and under, federal law. It is this ambit of the Regulation that should alert this Court to the constitutional inconsistency of which the plaintiffs complain. [297] As the plaintiffs correctly put it, Pt 14 of the Regulation is "an extraordinarily crude instrument to achieve the claimed end". Leaving aside its indifference to the distinction between State and federal rights, privileges and procedures affecting persons made subject to its terms and the draconian sanctions it imposes, it does not trouble to differentiate between general information concerning access to justice and the courts and the pursuit of proper claims about legal rights and duties (on the one hand) and ill-timed…, unmeritorious promotion of illegitimate and unreasonable claims having no relevant merit (on the other)…It ignores numerous expert reports suggesting the ineffectiveness of such overreaching prohibitions to secure their proclaimed objectives. Whilst such considerations relate to the merits, not the lawfulness, of the Regulation, they underline the indifference of those who made the Regulation to a nuanced, carefully targeted law, such as would be attentive to limitations deriving from the Constitution. In making, and maintaining, the Regulation, the State lawmaker was not troubled by any such delicacies.”

Of course, I am not here concerned with any constitutional invalidity, merely with the question whether the Regulation is validly made within the authority given by the Act. Nevertheless, the examples given by Kirby J – which are scarcely capable of controversy – also emphasise (as I have attempted to do) the reach of the Regulation and suggest that it grasps conduct significantly beyond that relating to the marketing of legal services.

The most crucial aspect of the grant of regulatory power is that the Act authorises regulations that relate to the “marketing of legal services”. Specific examples are given in wide terms. The phrases “relates to”, “in connection with” and “connected with” have very wide application indeed. It seems to me, however, that it is essential that the regulations be confined to conduct relating to matters that comprise two vital linked elements: “ marketing of legal services ”.

Before moving on to consider the implications of this point, I should deal with a submission made by Mr Lindsay SC for the Society concerning the interpretation of s 85(1). He submitted that each of the examples in paras (a) to (d) stood as independent authorisations of the regulation making power, relying on the words “without limitation” in parentheses in the opening words. I do not agree. If this interpretation were correct, it would mean, for example, that a regulation could be made, relying on para 1(d) prohibiting doctors from advertising their skills or a hospital from advertising its emergency services. I do not think that this could possibly have been the intention of the Parliament. The words in parentheses make it clear that the matters referred to in paras (a) to (d) are examples of the general class referred to in the opening words and should not be interpreted to limit the application of that general language.

It is difficult to understand why the Regulation did not use the language of the Act in terms for the purpose of defining the prohibited conduct.

Accepting that publish means, in effect, the public dissemination of information and that what is prohibited is the promotion of a product or service, such a communication may nevertheless not amount to “marketing” nor “conduct relating to marketing” although it seems that the draftsperson of the Regulations might have thought that the definitions of advertisement and publish did so. The mere public discussion of the desirability of involving lawyers in personal injury litigation, even if that discussion promoted the use of lawyers in the sense that it is commended or encouraged will not, without more, amount to marketing or to conduct relating to marketing. Nor would the objective imparting of information about legal services amount to marketing, even if the effect would be that the use of legal services was encouraged. Marketing, as it seems to me, requires more. The Macquarie Dictionary defines the word as: “The act of buying or selling in a market.” The Oxford English Dictionary defines it as: “The action or business of bringing or sending a product or commodity to market; (now chiefly, Business) the action, business, or process of promoting and selling a product, etc., including market research, advertising, and distribution”. It seems to me that the word connotes, in substance, the proposed sale by the marketeer, or someone on whose behalf the marketeer is acting, of a product or service and urging the audience to buy. Of course, charities might engage in marketing in the hope of attracting donations, but this is not different in principle. Each case will inevitably be one of fact and degree but the test must be whether the Regulation is limited to the statutorily defined conduct and, if synonyms are used in place of the statutory language, whether they remain inside the connotation of the statutory language. Accepting that “advertising” must mean more than mere informing, since the phrase in the definition is “advertising or otherwise promoting”, it seems to me, as I have said, that this is considerably wider in scope than “marketing”. In short, “promoting” means commending or encouraging; it does not involve any notion of sale – in short, any notion of a market. If, on the other hand, “advertising” is not an example of promoting, but stands independently, so that it means merely informing, then the Regulation moves even further outside the statutory authority. On either construction, therefore, the Regulation’s grasp exceeds the limits imposed by the Act.

The Regulation departs from the statutory language, not only as to “marketing” but also as to “legal services”. Thus, although cl 34(1)(a) refers to the provision of legal services, cl 34(1)(b) does not. The prohibition plainly covers advertising that has nothing to do with the provision of legal services. It is obviously because of the width of the latter paragraph that insurers, insurance agents and brokers are excepted from compliance. But others than those persons “advertise” insurance for personal injury. Similarly – as the exception in cl 37(c) implies – a lecture about the need for services including financial assistance for victims of crime, if made, say to social workers or a public seminar on child abuse would amount to an offence, though it had nothing to do with the provision of legal services. Any service or product that was advertised (in whatever sense) or promoted, even if it had nothing to do with the provision of legal services but which mentions the possibility of the payment of any money in respect of personal injury is criminal. If “advertise” is not limited by “promotes”, the Regulation would prohibit the dissemination of a torts textbook, though the publisher might be protected.

To use Kirby J’s metaphor of the blunderbuss, the question is whether, by application of s 32 of the Interpretation Act 1987, the Regulation can be read down so that the barrel is narrowed to limit the blast to the statutory target. One possible mode of doing so is by implying the words “relating to the marketing of legal services” in the opening words of cl 34, so that they would be understood as meaning – “34 Restrictions on personal injury advertisements (1) A person must not publish or cause or permit to be published a personal injury advertisement relating to the marketing of legal services if the advertisement…” If proper to be done, this would resolve the difficulty with subcl 34(1) but not with subcl 34(2). In the latter case the qualifying words would need to be added to that subclause, such as – “(2) A person must not publish or cause or permit to be published a personal injury advertisement relating to the marketing of legal services if the person is engaged in a practice involving…” There are difficulties facing a Court in applying such a solution where the words in excess of power are general and a “blue pencil” cannot be used to excise the offending language. This problem was adverted to by both McHugh and Kirby JJ in APLA and arose because they held that the Regulation applied too generally to matters not within the province of State power. Since the other Justices were of the opposite view it was unnecessary for them to consider this issue.

McHugh J said (224 CLR at 370-372, omitting most references) – “[90] Clause 140 allows the Law Society of New South Wales, for example, to maintain its lists of accredited specialists in personal injury matters. For those who are already aware of their rights or sufficiently informed to make enquiries, this exception to cl 139 enables those persons to obtain advice concerning their federal rights. But to say the least it seems highly unlikely that more than a small percentage of those who have federal rights would be aware of practitioners' directories. And even those who know of them may not be aware that the accredited specialists can assist them. One of the purposes of some of the advertisements of the plaintiffs is to inform citizens that they may have rights of which they are unaware. The enactment of cl 139 is itself eloquent testimony that, without advertisements of the kind that the plaintiffs wish to use, many persons will remain ignorant of their rights and their causes of action will not be enforced. [91] It follows that the Regulation cannot validly apply to advertisements that concern causes of action in federal jurisdiction. Severability [92] The question then is whether the invalid part of the Regulation is severable. New South Wales contends that the Regulation should be read down in accordance with s 31 of the Interpretation Act 1987 (NSW) and the ‘fundamental rule of construction that the legislatures of the federation intend to enact legislation that is valid and not legislation that is invalid.’ However, severability will only save legislation if the Court is able to uphold certain parts of that legislation without itself being required to legislate. When a court applies a severability provision and declares that so much of an invalid enactment is valid, it does so by a process of construction. It determines whether the law would be valid if it had been enacted without that part of it that is invalid. And it determines, as a matter of construction, that what remains after the severance gives effect to what the legislature intended to be the law on the subject. Expressly or by inference, therefore, the enactment must contain ‘a standard or test that can be applied so as to confine the enactment within constitutional power.’ For a court to give effect to its own ideas of how a valid law should operate would require the court to legislate. [93] On its face, cl 139 prohibits any advertisement by a barrister or solicitor that refers to or depicts in any way personal injury or circumstances in which personal injury might occur or refers to a legal service relating to the recovery of money in respect of personal injury. It applies to all advertisements concerning personal injury and legal services relating to personal injury irrespective of whether an injury gives rise to any right of action. In prohibiting these advertisements, it does not distinguish between kinds of personal injury or the sources or nature of any rights, claims or privileges that might arise in respect of those injuries. Nor does it refer to the courts where any right of action concerning personal injury may be enforced. [94] In these circumstances, I do not think that it is possible to read down the Regulation so that it can operate validly. In Victoria v The Commonwealth [1995] HCA 45; (1996) 187 CLR 416 at 502, five members of this Court said: ‘Where a law is expressed in general terms, it may be more difficult to determine whether Parliament intended that it should, nonetheless, have a partial operation. And there is an additional difficulty if it “can be reduced to validity by adopting any one or more of a number of several possible limitations” ( Pidoto v Victoria [1943] HCA 37; (1943) 68 CLR 87 at 111).. It has been said that if, in a case of that kind, “no reason based upon the law itself can be stated for selecting one limitation rather than another, the law should be held to be invalid” ( Pidoto v Victoria [1943] HCA 37; (1943) 68 CLR 87 at 111.’ [95] There is no term or provision in cl 139 that can be excised so as to give it validity. The Regulation is expressed in general terms. There are a number of limitations that could be used to give it validity. They include inserting words such as ‘other than federal rights’ or ‘other than rights that involve or may involve federal jurisdiction’ or ‘consistently with Chapter III of the Constitution’ or ‘which concern State law or State courts’. No doubt other limitations can be identified that would arguably save the Regulation. But to insert any of these limitations would recast the Regulation and give it a meaning and effect very different from what it has. And, notwithstanding s 31 of the Interpretation Act 1987, it is by no means clear that, if the Regulation cannot validly apply to all advertisements, its makers intended it to have a partial operation. The Regulation is expressed ‘in a form and with a completeness and definitiveness that give neither place nor means for the application of the general intention in favour of severance ( Bank of New South Wales v The Commonwealth [1948] HCA 7; (1948) 76 CLR 1 at 373 per Dixon J).”

Kirby J said (224 CLR at 446-447, omitting references) – “[367] The severance issue: The State of New South Wales argued that Pt 14 of the Regulation should be read down so as to avoid invalidity. At common law there was a presumption against the severance of invalid parts appearing in a coherent legal document. It was this presumption that led to the enactment of statutes, permitting and enjoining courts to read and construe contentious laws so as to uphold their validity and to avoid excess of power, whether statutory or constitutional. [368] The principle to be applied in all cases within such statutory prescriptions is that, wherever possible, conformably with the legislative declaration, a law should operate on ‘so much of its subject matter as Parliament might lawfully have dealt with’. [368] A difficulty arises where the impugned law affords no textual foundation for applying a ‘blue pencil’ to the offending parts ‘so that the valid portion could operate independently of the invalid portion’. Such is the case here. Assuming for present purposes that Pt 14 of the Regulation could operate validly upon communications in the State of New South Wales in respect of rights and privileges afforded exclusively by that State's law, the Regulation does not attempt to differentiate such subject matters from its purported, and invalid, operation on federal rights, privileges and remedies and their prosecution in federal courts, State courts exercising federal jurisdiction and before federal tribunals. [369] Given the stated object of the lawmakers to impose a comprehensive overarching prohibition of communications about personal injuries and their litigation (evident in any case in the terms of the Regulation) and given that such object, in the generality of its expression, impinges on federal law and the protected freedom, defensive of Ch III, contained in the Constitution, no question of reading down arises. Clearly, the Regulation was intended to operate in an undifferentiating way. To attempt surgery on its language would be to create a law different from that now appearing. Given particularly the opportunities that have arisen for the federal concerns to be cured but without repair, it would be contrary to this Court's judicial function to attempt severance. It cannot be said with any degree of certainty that the maker of this Regulation intended it to operate in some more limited and truncated or nuanced version. To attempt to convert a blunderbuss into a precision rifle is not a judicial task. The Regulation in question was ‘either good or bad’ in its totality. In my view, it is bad. It is wholly invalid under the Constitution.”

Two points of possible distinction might be made: the first is that their Honours were dealing with Constitutional invalidity rather than the excess of regulation making authority; the second, that the posited solution appears to be the addition of the statutory words themselves. On the other hand, it is clear to the point of demonstration, for example by reference to the need to except legal eduction lectures to lawyers (but not to students!) and insurers, that cl 34(1)(b) was deliberately drafted to apply to services that were by no means limited to legal services. I have not found this problem easy to resolve but, in the end, I have concluded that I should abide by the approach adopted by McHugh and Kirby JJ. I think that the distinctions to which I have referred are matters of form rather than substance.

It follows that subcl 34(1) is ultra vires the Act.

Subclause 34(2) refers specifically to lawyers but not in respect of their conduct or functions. If it can be supported, this must be by reference to s 85(1) of the Act, since there is nothing in the Act, the carrying out or effectuation of which might be assisted by it, subcl 34(2) must, therefore, also fall.

Subclause 34(3) depends upon the survival of the other subclauses. Consequently, it must fall.

Accordingly, the whole of cl 34 of the Regulation is void. Has AIH contravened the Regulation at all events?

This question again requires an interpretation of the Act and the Regulation, which do not of course, express any geographical limitation in their application. Such limitations are to be implied in accordance with s 12 of the Interpretation Act 1987, which is as follows – “12 References to New South Wales to be implied (1) In any Act or instrument: (a) a reference to an officer, office or statutory body is a reference to such an officer, office or statutory body in and for New South Wales, and (b) a reference to a locality, jurisdiction or other matter or thing is a reference to such a locality, jurisdiction or other matter or thing in and of New South Wales. (2) In any Act or instrument, a reference to a body constituted by or under an Act or instrument need not include the words “New South Wales” or “of New South Wales” merely because those words form part of the body’s name or title.” Of course, s 12 must be read subject to any explicit geographical limitation in the statute.

In APLA , a number of the Justices dealt with the implicit geographical range of the Regulation by reference to s 12.

Gleeson CJ and Heydon J said (224 CLR at 354) – “ Extra-territoriality [40] Question (1)(t) and (e) refer to the extra-territorial operation of the Regulations. The Regulations are aimed at the advertising of legal services to be provided in New South Wales, but they apply to such advertising even if it takes place outside New South Wales, for example on the internet. It is the provision in New South Wales of the advertised services that provides the necessary connection, both with the regulation-making power conferred by s 216 of the Legal Profession Act and with the power of the State parliament to make laws for the peace, order and good government of New South Wales. That power requires a relevant territorial connection but the test of relevance is to be applied liberally and even a remote or general connection will suffice… Here the connection is direct and substantial.”

Gummow J said (at 388-389, omitting references) – “[154] Paragraphs (d) and (e) of question 1 may be considered together. They ask whether ‘by virtue of the nature of its extra-territorial operation’ Pt 14 of the regulation exceeds the legislative powers of the state and the powers under the Act (which is to be read as a reference to s 216(1)) to make regulations. [155] Section 216(1) is a generally expressed regulation-making power in familiar form. Subject to the presence of a contrary intention, the reference therein to ‘any matter’ is to be read as ‘any matter … in and of New South Wales’. Section 12(1) of the Interpretation Act 1987 (NSW) (the Interpretation Act) so provides. Likewise, and by operation of the same provision, references in the regulation are to be read in the same fashion. Section 12 applies not only to statutes but to instruments made under statute: s 3(1). [156] It may be conceded for present purposes that material uploaded onto a computer server outside New South Wales but available to be displayed in New South Wales on an internet website and to be downloaded there nevertheless is not published in New South Wales within the meaning of the definition of ‘publish’ in cl 138. It is unnecessary to decide the point. [157] What is apparent is that the legal services, the provision of which is the subject of an advertisement as defined in cl 138, are legal services to be provided in New South Wales. Such a construction agrees with s 12(1) of the Interpretation Act and with the general subject, scope and purpose of the Act, the regulation of the admission and practice in New South Wales of solicitors and barristers.”

(His Honour’s statement about where the publication occurs in para [156] is contrasted by his Honour with Dow Jones & Co Inc v Gutnick [2002] 210 CLR 575.)

Neither McHugh nor Kirby JJ needed to deal with the extra territoriality issue. Hayne J agreed with Gummow J (224 CLR at 449) but added ( ibid at 463) that the purpose of the Regulation was “preventing the advertisement in New South Wales of the legal services with which they deal”.

In dealing with the argument advanced under s 92 of the Constitution, Callinan J said (224 CLR at 482) – “[462]…the Regulations are not aimed any more at interstate trade, commerce, and intercourse than they are at the effective operation of representative and responsible government. They are, as clause 139 makes clear, aimed at preventing a barrister or solicitor, that is a lawyer in or practicing in New South Wales , from advertising legal services for the pursuit of claims for personal injuries in that State. This follows from the ordinary limits upon the extra-territoriality of state legislation and the narrow and precise definition of barristers and solicitors for the purposes of the contested provisions … “ [Emphasis in original.] [463] It is not suggested that the contested provisions are incapable of having some conceivable effect upon advertisements originating or read outside the State of New South Wales. They are, however, the laws which have as their real object the prescription or proscription, in a non-discriminatory way, of a particular kind of professional conduct in or in relation to litigation in the courts of New South Wales … “

It is, I think, worth mentioning that, on behalf of the New South Wales, Mr M G Sexton QC, the Solicitor General, stated (224 CLR at 331) – “In conformity with s12 of the Interpretation Act 1987 and general rules of statutory construction…Part 14 should be read as applying only to communications which advertise the provision of legal services in New South Wales. Any burden on interstate communication is merely an incident of the general regulation of advertising for the provision of personal injury legal services in the State…As it applies only to advertisements promoting the provision of legal services in New South Wales, it is within the regulation-making power and the plenary legislative power of the State.”

Although these statements were made in a somewhat different context – the constitutional propriety of the 2002 Regulation – it seems to me that I should accept them as authoritative in the present case. It would not be appropriate for me to adopt a reading of the Regulation inconsistent with that of a majority of the High Court in relation to precisely the same question, namely the extra-territorial reach of an identical (so far as geography and subject matter are concerned) statutory instrument.

Accordingly, the publication must concern the provision of legal services in New South Wales.

A somewhat more difficult question is whether the publication must occur in New South Wales. It seems clear enough that the Parliament of New South Wales can legislate to prohibit conduct that occurs outside the State in respect of matters that have a “relevant territorial connection” and, accordingly, the prohibition of advertising outside the State of services to be provided in New South Wales would be within this State’s constitutional competence: see, for example, APLA per Gleeson CJ and Heydon J (224 CLR at 354).

However, it is one thing to have the power to make a particular enactment and quite another to enact it. I am unable to see in the Act or the Regulation any intent to avoid or vary the application of s12 of the Interpretation Act 1987. In my view, the application of s 12 requires that the publication in question must both have been published in New South Wales and concern the provision in this State of legal services.

In the present case, the earlier form of the advertisement, which was accessible in this State as I have described by the use of conventional and widely available search sites, was a prohibited publication, subject to the question whether it advertised the provision of legal services in New South Wales. Mr Perram SC for AIH contended that, because the website was plainly not directed to persons in this State and sought to discourage them from accessing it, it was not published here even if it appeared on a computer screen in the State. He relied on Ward v Brodie & Stone (215) ALR 716, in which Merkel J held that the display on a website seen in Australia was not a “use” of a trade mark here because the relevant product was not available here. I find it difficult to accept that “use” in patent law has the same meaning as “display on an internet website” as that phrase is used in the definition of “publish” in cl 23. In my view, that display here, though not, as it were, aimed at New South Wales residents, is a publication here. It had certainly been seen in New South Wales by employees of the Law Society and was so easily capable by the use of conventional means of being published here that injunctive relief against the possibility would properly have been given in respect of it if the additional element that it concerned the provision of legal services in New South Wales was present.

It cannot be argued that the website, in both forms, does not constitute marketing of legal services. In my opinion, however, the legal services in question are not those to be undertaken in New South Wales. This is made clear both by the attempt to deflect any New South Wales enquirer and by the clearly stated exclusion of “accidents having some connection with New South Wales”. It is difficult to see how any accident having no connection whatever with New South Wales could call for the provision of legal services in New South Wales, with the exception of a New South Wales resident seeking legal assistance here for litigation to be conducted interstate. It seems to me that such an eventuality is not a legal service of the relevant kind. It is unlikely that the Parliament of New South Wales were concerned with the conduct by lawyers in this State of litigation elsewhere. It seems to me that is made clear by the Second reading speech of the Minister, the Honourable John Hatzistergos, who commenced by saying – “The manner in which lawyers’ services are advertised and marketed can have a detrimental effect on both the court system and the availability of affordable insurance.” The Minister concluded his speech as follows – “These amendments … [are] critical to ensure that such advertising does not have a detrimental effect on the court system and on public liability and workers’ compensation insurance premiums.”

There is no suggestion of a serious apprehension that the form of the website, so far as the exclusion of non-New South Wales connected accidents is concerned, will be changed. There is no proper basis, therefore, quite apart from the ultra vires character of the Regulation, for the grant of injunctive relief in respect of the website. Is AIH acting as a solicitor or representing that it is?

The Law Society contends that the relationship between AIH and the solicitors on its panel and the enquirers and clients is such that it is engaged, or purports to be engaged in legal practice contrary to ss 14 and 15 of the Act. The Society also alleges that there is evidence from the correspondence between AIH and some of the enquirers from which it ought to be inferred that AIH was giving legal advice to them about the prospects and character of their claims. Of course, the present proceedings concern only New South Wales practitioners on the panel and to whom, as it happened, AIH referred a substantial number of potential clients.

Section 14 of the Act is, relevantly, in the following terms – l “14(1) A person must not engage in legal practice in this jurisdiction for fee, gain or reward unless the person is an Australian legal practitioner. Maximum penalty: 200 penalty units” There are a number of exceptions in the following sub-sections which are not material.

Section 15 of the Act is, relevantly, as follows – “15 Prohibition of representing or advertising entitlement to engage in legal practice when not entitled (1) A person must not represent or advertise that the person is entitled to engage in legal practice unless the person is an Australian legal practitioner. Maximum penalty: 100 penalty units. (2) A director, officer, employee or agent of a body corporate must not represent or advertise that the body corporate is entitled to engage in legal practice unless the body corporate is an incorporated legal practice or a complying community legal centre. Maximum penalty: 100 penalty units (3) … (4) A reference in this section to a person: (a) representing or advertising that the person is entitled to engage in legal practice, or (b) representing or advertising that a body corporate is entitled to engage in legal practice, includes a reference to the person doing anything that states or implies that the person or the body corporate is entitled to engage in legal practice.”

What then is meant by the phrase “engage in legal practice” for the purposes of these provisions? This phrase has been considered in a number of contexts and it is necessary to refer briefly to some of the authorities. In Victoria, the Legal Practice Act 1996 (Vic) provides that persons “must not engage in legal practice in Victoria” unless they “are properly qualified and admitted” and s 316 gives power to the Supreme Court to “grant an injunction restraining a person engaging in legal practice, or representing or advertising that they are qualified to engage in legal practice” when they are not. The meaning of the phrase “engage in legal practice” was considered in Felman v Law Institute of Victoria [1998] 4 VR 324. Kenny JA (with whom Winneke P and Brooking JA agreed) said (at 352) - “The appellant contended … that the expression ‘engaging in legal practice’ meant engaging in the work which is done exclusively by those who are qualified legal practitioners, but this would plainly circumscribe the expression more narrowly than Parliament intended … . In my opinion, the expression to ‘engage in legal practice’ in s 314 and elsewhere signifies to carry on or exercise the profession of law. Reference to the definitions of ‘engage’ and ‘practice’ in the Oxford English Dictionary support the view that this is the ordinary and natural meaning of the expression. The carrying on of the profession of law is done by none other than a ‘legal practitioner’. Accordingly, in my view, the expression ‘engage in legal practice’ means ‘engage in legal practice as a legal practitioner ’, the italicised words being implicit in the notion of legal practice. This construction is supported by the fact that the expression ‘engage in legal practice’ was evidently intended to cover both sides of the profession, namely barristers and solicitors (collectively legal practitioners)…”

This passage was referred to with approval by the New South Wales Court of Appeal in Kekatos v The Council of the Law Society of New South Wales [1999] NSWCA 288 by Giles JA (with whom on this point the other Judges agreed) at [16]. Giles JA went on to refer, as a second way of acting as a solicitor, to the well known judgment of Cussen J in In re Sanderson; ex parte The Law Institute of Victoria (1927) VLR 394 at 369 – “ … if a person does a thing usually done by a solicitor, and does it in such a way as to lead to the reasonable inference that he is a solicitor – if he combines professing to be a solicitor with action usually taken by a solicitor – I think he then does act as a solicitor.”

Giles JA noted that this manner of acting as a solicitor was adopted and applied in New South Wales in The Council of the Law Society of New South Wales v Seymour (1999) NSWCA 117. His Honour referred to the decision of Phillips J in Cornall v Nagle (1995) VR 1888 as a third way of acting as a solicitor. In that case, Phillips J stated that “a person might also ‘act or practice as a solicitor’ by doing something which was positively proscribed by an act or rules of court unless done by a duly qualified legal practitioner, or by doing something which, in order that the public might be adequately protected, was required to be done only by those who have the necessary training and expertise in law”. Giles JA pointed out ((1999) NSWCA at [17]) that taken literally, this proscription “extended to a variety of activities legitimately carried on by legally qualified persons, including, judges, legal academics, and arbitrators, who were not acting or practising as a solicitor, or purporting to do so, when carrying out those activities”. It therefore needed some qualification. Giles JA concluded by quoting the following passage in The Council of the Law Society of New South Wales v Seymour (unreported, NSWCA 3 May 1999) from the judgement of Fitzgerald JA (with whom the other judges agreed) which I think is helpful for present purposes – “While some activities regularly performed by solicitors are also frequently lawfully performed by persons who are not solicitors, for example, by accountants, merchant bankers, financial advisers, etc. other activities regularly performed by solicitors, including activities which may be lawfully performed by a person who is not a legal practitioner with a current practising certificate, might seldom, if ever, be performed by any person who is not a solicitor. Although activities which fall into either category are material, an affirmative answer to the second question drawn from In re Sanderson (1927) VLR 394, will likely be difficult to arrive at if the only relevant activities are in the first category and are limited in their number and nature. There is no policy justification for including activities which may be lawfully carried out by any person who does not act as though he or she has a status which he or she does not possess within the monopoly of legal practitioners with practising certificates. … The inference required by the second question based on Sanderson…,must be considered by reference to a reasonable person with knowledge of the material activities, which will include any statement by which the person performing the activities misrepresents that he or she is a solicitor or explains that he or she is not a solicitor. The reasonable person to be considered is a person dealing with the person alleged to have acted as a solicitor. When activities may lawfully be carried out by a person who is not a solicitor, his or her knowledge that the person with whom he or she is dealing is aware that he or she is not a solicitor, even if not based on his or her acknowledgment of the true position, makes it difficult, if not impossible, to be satisfied that the only reasonable inference open is that he or she acted as a solicitor.”

Whether a person is engaging in a legal practice in the relevant sense where work involves some legal advice or the making of legal judgment is plainly a question of fact and degree. A number of particular examples have been cited to me, to which I will refer, but in each case it was necessary for the Court to analyse in some detail what was undertaken and then arrive at a judgment about whether the particular defendant had engaged in the prohibited conduct. What these cases show is that there is no bright line in separating the permissible legal work from the impermissible legal practice.

The Society relied, in particular, upon Attorney-General v Quill’s Wills Ltd & Ors (1990) 3 WAR 500 in which Ipp J considered whether the defendants’ business to sell a “will making franchise” based on the use of computers and software to create wills containing clauses drafted or settled by legal practitioners amounted to the giving of legal advice prohibited by s 76 of the Legal Practices Act 1893 (WA). The language of the section was very wide but the essential distinctions required to be made were, to my mind, the same as those necessary to be made in New South Wales and Victoria. It is sufficient to quote from the headnote the findings of Ipp J (3 WAR at 501) – “The plaintiff’s case rested on the submission that giving the brochure, the Quill Will reader, the witnessing pamphlets and other Quill Will documents constituted legal advice. Held: (1) In the general scheme four types of legal advice were identifiable: (a) the representations that a will produced by the quill Will Maker would be valid, would be giving assurances concerning the rights of prospective testators under the law, and as such would constitute legal advice; (b) giving the quill Will Maker to the client for the purpose of inviting them to make a selection from the Book of Clauses constituted in the circumstances the giving of legal advice; (c) explanations and instructions in the documents such as definitions constituted in the circumstances the giving of legal advice; (d) The contents of the witnessing pamphlet containing information with reference to execution of wills constituted the giving of legal advice. (2) In assuring the client of the validity of the will, in instructing the client what to do to ensure that validity, and in explaining the terminology used Quill Wills was giving the advice itself. To the extent that Quill Wills argued that it was but repeating advice provided by lawyers, the words and tenor of the document made it clear to the reader that Quill Wills adopted, endorsed and identified itself with that advice. The franchisee by handing the documents to the client also adopted, endorsed and identified with the advice contained therein and in fact gave it himself. (3) The franchisee adopted, endorsed and identified himself with the preparation and the drawing of the clauses. The franchisee accepted responsibility for the will provided. The work done by the certified legal practitioners was marketed as part of the franchisee’s own business. In the circumstances, by offering the bank of clauses to the client, and by adopting and endorsing and identifying with the bank of clauses and the Quill Will system as a whole, and thereafter by producing the will in accordance with the client’s instructions for which he accepted responsibility, the franchisee directly or indirectly draws and prepares an instrument within the meaning of s 77.”

I discuss in detail below the extent to which AIH’s scheme involved any assumption of responsibility involving the making of legal decisions, as demonstrated by its operating manuals. I should state now, however, that it seems to me that the character of the scheme was very different indeed from the character of the scheme in Quill’s Wills . In particular, AIH’s scheme, to the extent it involved legal advice and the exercise of legal judgment, was very much concentrated on the initial decision to refer to and gathering the initial statements for use by the Panel Solicitor, for which a significant fee was charged. The conduct of the proceedings although it occurred, it may be, in consultation with AIH, were in every important sense conducted by the solicitor.

Quill’s Wills was distinguished on the facts by Osborne J in Law Society of Victoria v Merrick & Anor [2006] VSC 361, where his Honour needed to consider the position of a scheme set up by a non-lawyer with qualifications in conveyancing who completed statements under s 32 of The Sale of Land Act 1962 requiring a vendor under a contract for the sale of land to give a purchaser before the contract is signed a statement disclosing mortgage particulars, details of statutory charges, lists of services connected to the land, particulars of sub-standard water supply or sewerage service, road access, information relating to terms contracts, particulars of vendors insurance, particulars of body corporate fees and land use restrictions due to contamination, relevant title documentation and the like. The Law Institute contended the completion of such a statement involved the giving of express or implied legal advice and therefore constituted legal work. The Institute argued that it involved engaging in legal practice because the giving of legal advice is something which is required to be done only by those with the necessary training and expertise in order that the public be protected, so that the preparation of a s 32 statement would always constitute the practice of law. Osborne J referred to Quill’s Wills and Australian Competition and Consumer Commission v Murray [2002] 132 FCR 428 (which raised similar issues to Quill’s Wills ) as follows – “[90] The Institute submits that assistance with the creation of a will is an analogous to a s 32 statement as both involve the use of pre-prepared forms or systems to create legal documents. [91] In my view, however, there is a fundamental difference between the completion of a s 32 statement and the making of a will. A will is intended to effect the change in legal relationships. The preparation of a will necessarily carries with it implied advice that the document is effective to realise the intentions of the testator in this regard. Significantly a central part if Ipp J’s reasoning in Quill’s Wills was that the use of the will kit would result in a valid will being brought into existence… [92] Conversely, a s 32 statement is essentially an information statement, preliminary to a conveyance. It does not purport to effect a change in legal relationships, it states information concerning the property which a vendor wishes to sell. [93] It may be objected that the information provided involves questions of mixed fact and law. Thus a statement as to the zoning of land or as to rates owing with respect to the property, thought commonly answered by reference to certificates provided by the relevant authority, ultimately involves questions of mixed fact and law. [94] In my view, however, it would be entirely artificial to regard the making of such statements as necessarily involving the giving of legal advice. Questions of zoning are ascertainable by reference to the relevant planning scheme provisions. Interpretation of the relevant ordinance and maps is not essentially the work of a lawyer. Indeed, it may well be that in cases of difficulty it is better undertaken by a town planner or a surveyor. Likewise, the quantum of rates owing with respect to the property is fundamentally a question of accounting. [95] It is, however, further submitted that specific components of the information required to be provided in the s 32 certificate necessarily involves the exercise of legal expertise incidental to the provisions. [96] In particular, the Institute emphasised in argument that the initial requirement contained in sub-s 2 of the statement contained [particulars of any mortgage affecting the land which is not to be discharged before the purchaser becomes entitled to possession or to the receipt of rents and profits. [97] In the present case the s 32 statement forming the basis of the proceedings did not disclose the land was subject to any mortgage whatsoever. It further contained a note referring to the relevant statutory requirement. [98] I accept that in some circumstances the provision of the relevant particulars may involve the giving of legal advice. Thus it is possible that such advice may be necessary to respond to particular circumstances in which some real questions arising as to whether land is subject to a mortgage, of the class referred to.”

In the result, Osborne J held that the completion of the s 32 statement might or might not involve the giving of legal advice relating to the existence of a relevant mortgage, but that in many cases it would not because the facts obtained by a conveyancer from a putative vendor would exclude the possibility of such an issue arising. Furthermore, his Honour held, where the matter was uncertain, a conveyancer might decline to formulate a statement in answer to the particular question and require the client to take it to a solicitor. This indeed was the defendant’s position, and his Honour had no reason to reject it. His Honour concluded that there was no real substantial risk that the conveyancer would give legal advice and accordingly refused to give relief. In this context, the giving of legal advice in the context of other proper commercial activities such as those conducted by an accountant in respect, say, of accounting obligations or income tax liabilities is not legal practice within the meaning of the legislation.

The most recent case requiring an analysis of legal work to ascertain whether the person undertaking it was engaged in legal practice is The Council of the New South Wales Bar Association v Davison [2006] NSWSC 65. In this case, Hall J was required to consider whether work done by a barrister who was not the holder of a current practising certificate relating to town planning questions was acting as a barrister. The essential issue for determination was whether Mr Davison was acting as a town planner or as a barrister, it being accepted that town planners worked extensively with a high degree of expertise in advising and assisting persons preparing and conducting cases, for example, in the Land and Environment Court. However, his Honour found that although a town planner might do some of the work done by Mr Davison, his activities were not undertaken by him as a town planner and his Honour gave detailed consideration to the work that barristers do in connection with town planning disputes and the hearing of cases in the Land and Environment Court and noted that “whilst planners and other professionals contribute to planning issues both in the context of and outside legal proceedings, determining the legal interpretation of legal instruments and the task of determining the evidence to be adduced in legal proceedings remains the work of lawyers and it is not work that planners are authorised to undertake in the pursuit of their professional work ([2006] NSWSC 65 at 132]). His Honour concluded – “[134] Accordingly, whilst some only of the advice provided by the defendant related to strict legal issues (eg, matters of statutory interpretation or the powers of local government authorities) a great deal of the advice provided by him was otherwise legal work within the practice of a barrister (and therefore ‘legal advice’) in that a great deal of it related to the conduct and preparation of legal proceedings including, in particular, the evidence considered by him as necessary or desirable for the proceedings.”

His Honour held (rightly if I may say so with respect) that the provision of legal advice for reward when briefed to do so “is typical of the work undertaken by a barrister” and, in respect of the work of a barrister when conducting litigation, a wide range of functions is undertaken including the preparation of evidence, advice on gathering evidence, advice on strategic issues, of evidentiary issues, litigation prospects and settlement of proceedings. His Honour considered that “the very nature of the advice provided by [the defendant] as identified in this judgment was in the nature of legal advice which barristers were called on to provide”.

Davison is a case very far removed, as it seems to me, from the present case. However, for the reasons that I set out below, I think that it is necessary to conclude that AIH indeed does give legal advice in the same way as that which would be given by a solicitor.

The Law Society also relies upon the nature of the relationship between Panel Solicitors and AIH as bringing AIH within the prohibition identified in Law Society of New South Wales v Ramalca Pty Limited (1988) 12 NSWLR 34. As will become apparent, I do not think that there is any measure of control in any sense akin to employment as between AIH and the Panel Solicitors. The sanction for not complying with the protocols set out in the operating manuals is that the solicitor will be removed from the manual. In that sense, the arrangement is a voluntary rather than a contractual one. And, even if it were a contractual one, I do not think that it involved such a measure of control over any practice as to amount to anything remotely constituting employment. Nor do I accept that any client would have been under any misapprehension that the solicitor retained by him or her was employed by AIH or acting on AIH’s behalf.

In regard to this aspect of the case, the Society relied on the statement in the website that – “All of Australia injury Helpline’s ‘Panel’ solicitors are specialists in Personal Injury Law and are contracted to supply you with an unrivalled service…” In my opinion this does no more than assert that there is an agreement that the service will be excellent in the specified ways, all having to do with the efficient conduct of the case and keeping the client informed. As I have said, I am not altogether sure whether there is indeed any contractual obligation created but this is by the way. I do not think that the advertisement in fact suggests employment. Moreover, I do not think that there is any employment.

Whether a person is carrying on legal practice is very much a question of fact and degree. Here, AIH made no bones about its intention to require solicitors to undertake matters in accordance with its protocol, essentially designed to ensure that cases were managed efficiently and without undue expense and delay and, consistently emphasised, in regular and timely communication with the client. On the face of it, these are desirable objectives and do not, of themselves, suggest undertaking legal practice, even if the way in which that practice is undertaken is regulated. Of course, from the solicitor’s point of view, it would be a breach of professional obligations if, indeed, the management of the clients’ matters according to AIH’s protocols amounted to a delegation to AIH of professional obligations to the clients or interfered with the solicitor’s judgment as to the interests of the clients. In short, the obligations of the solicitor to the client are of a primary kind and cannot be controlled in any way that might prejudice the client’s interests, let alone delegated to a person who is not appropriately qualified and entitled to practice. There was no suggestion put to me, except possibly by way of implication, that any of the solicitors whose dealings with AIH were the subject of evidence had delegated their professional responsibilities to AIH. Certainly there was no suggestion that they had acted in any way that was not entirely in their clients’ interests.

A useful commencement point for this discussion is the “Panel Solicitors Operating Manual” sent to each of the panel solicitors explaining the expectations of AIH by way of reciprocation for being on the panel. Two of these have been tendered by the plaintiff, the first is dated 1 May 2001 and the second 1 January 2005. It is necessary to deal with these manuals in some detail.

Section 1, headed “Introduction and Overview”, states first the purpose of the manual. It is said that it “provides that information and guidance on the methods of operation of the Australian Injury Helpline Scheme”. The solicitor dealing with claims referred by AIH “must be familiar with the contents of the manual … [and] they must fully adhere to the guidelines and procedures outlined in this manual”. Following are the most significant portions of the 2001 manual for present purposes. “SECTION ONE - INTRODUCTION AND OVERVIEW A Purpose Of The Manual This manual is for the use of the Australian Injury Helpline Ltd’s Panel of Solicitors and provides both information and guidance on the methods of operation of the Australian Injury Helpline scheme. From here on in the Australian Injury Helpline Ltd is referred to in this document as ‘AIH’. The partner, solicitor or fee earner who deals with claims referred to AIH must be familiar with the contents of this manual. In addition, they must fully adhere to the guidelines and procedures outlined in this manual. Asking legal practices to adopt procedures set out in this manual helps to standardise management and reporting information and ensures that consistent a high standard of service is maintained, regardless of which Panel Solicitor have been instructed to act. It is also important that legal services provided are consistent with promotional and marketing material. Whilst this manual is intended to ensure protocols and maintenance of certain procedures, AIH is not concerned with trying to tell the Panel Solicitor how to run a case. It is the province of the Panel Solicitor to ensure that appropriate legal advice is given at each stage and that standards of ethical conduct are maintained. It is important for clients who are insured, to ensure that AIH are kept fully informed of all material developments. Cover under the insurance policy requires regular review and certain conditions to be fulfilled. AIH constantly review the content and procedures outlined in this manual. Any update sheets for the manual will be supplied to ensure your manual remains current. Any questions or comments on the content of this manual should be addressed to AIH. PLEASE NOTE A SERIOUS BREACH OF THE TERMS OF THIS MANUAL MAY LEAD TO THE TERMINATION OF A PRACTICE’S MEMBERSHIP ON THE PANEL B A Brief Overview of AIH AIH generates leads for Personal Injury claims through numerous different advertising mediums. All advertisements give out a free phone number and a team of trained advisors answers all telephone calls. The initial inquiry is answered by one of the team of trained advisors. The advisor asks the enquirer a number of relevant questions about the circumstances of the accident and full details are passed on to the claims Manager for consideration and referral. The Claims Manager will assess with the aid of independent legal advice whether there would appear any merit in the claim on the basis of the information supplied. This is only an initial assessment and the company has not contacted the prospective claimant further at this stage. There are 3 different stages at which the Panel Solicitor can receive referrals from AIH. 1, following the initial assessment and indication of a possible claim (REF). 2, after extensive further enquiries are completed and it has been established that the claimant has more than a 51% chance of succeeding (CLM). 3, after extensive enquiries are completed and it has been established that the claimant has more than a 51% chance of a successful Workers Compensation Claim (WCC). Should the Panel Solicitor wish to receive REF claims from AIH they will be referred following the initial assessment by the Claims Manager. Claims referred at this stage have no established degree of liability against a third party, no guarantee of success and no agreement from a client they want solicitors instructed. No further contact has been made with the prospective claimant following their initial response to the advertisement, it is thereafter up to the Panel Solicitor to contact the prospective claimant, investigate the matter further and convert the referral into a claim. AIH makes no claims regarding REF referrals and conversion thereof apart from confirming that the prospective claimants have responded to an advertisement. AIH will at the Panel Solicitor’s request write to the prospective claimants who are referred at this juncture on an agreed format basis. CLM and WCC claims are fully established claims with clients who have agreed to the instruction of solicitors on their behalf. A ‘considered’ assessment that the claim has more than a 51% chance of succeeding will have been made. AIH investigates CLM and WCC claims further and in-depth. The Claims Manager will have arranged for all the necessary information to be obtained to enable a fuller assessment of liability to be made. This can include a detailed client statement, a plan of the locus, photographs, witness statements etc. The claimant will have signed an Instruction Form and also an application for the Conditional Fee Arrangement Insurance Policy and credit agreement will have been made on CLM claims. The claim is then sent to a Panel Solicitor who can then decide whether or not to accept the case, there is no obligation on any Panel Solicitor to take any case. The Panel Solicitor should fax the Acceptance Forms to AIH and an invoice will be sent out for payment within 7 days of receipt of the same. AIH will arrange directly with the claimant the purchasing of the Conditional Fee Arrangement Insurance policy. The Panel Solicitor will be supplied by AIH with full details of the policy purchased including the premium and interest rate applicable. Where the client appears to have the option of proceeding at common law or under Workers’ Compensation legislation, any insurance policy purchased by the client may be cancelled, without cost or penalty if the client elects not to proceed under common law. The Panel Solicitor must give the client the opportunity to withdraw from the scheme in line with their full legal entitlements. The Panel Solicitor must also outline the consequences of pulling out of the credit agreement of the AIH scheme. Where the case has the benefit of an insurance policy the full amount due to the insurance premium Credit Company including interest must be discharged prior to the balance of the claims settlement being forwarded to the client. This is the responsibility of the Panel Solicitor who will be responsible for any shortfalls to the Credit Company.”

Despite the Society’s submissions to the contrary, it does not seem to me that there is anything in this section which suggests the undertaking of legal practice. It is true that the advisor is said to ask “the enquirer a number of relevant questions about the circumstances of the accident” and it may be that the determination of relevance is at least to some extent a legal task. Nevertheless, the relevance in this context is not the relevance for the purpose of advising the enquirer but to the claims manager to assess whether there is any merit in the claim for the purpose of a referral. I do not think there is anything that suggests that the enquirer is informed whether there is any merit in his or her claim. This is made clear from the specified stages at which the Panel Solicitor can receive referrals. The reference to “the instruction of solicitors on their behalf” seems to me to mean merely that the clients will have agreed to instruct the solicitors to act for them. I do not think it means that the instructions come from AIH.

It seems to be a significant part of the scheme operated by AIH that the enquirer will purchase a Conditional Fee Arrangement Insurance Policy. The terms of such policy are not set out in the document, but it appears that AIH will pay for the cost of medical reports when a Conditional Fee Arrangement Insurance Policy has been entered into.

AIH charges $200 for the “work undertaken on the matter” referred. The invoice is “supplied in the form of a disbursement fee note”, I take it to enable the fee to be recovered from a defendant in the event of a successful claim. When the Panel Solicitor has decided to accept the case by filling in the acceptance form, AIH “will raise an invoice for the work undertaken”. This invoice is for $1,100 plus GST for a common law claim or $700 plus GST for a workers compensation claim. Again, “the invoice will be supplied in the style of a disbursement fee note”. It is difficult to understand the basis upon which these fees are calculated but it does not seem to me that the requirement that these sums be paid is material to whether or not AIH is conducting legal practice. In dealing with the claims manager’s role, the “Panel Solicitor is urged to use the Claims Manager to obtain any further supporting evidence required” and the services supplied following such a request will be paid for only upon conclusion of the claim, that is to say “credit will be supplied” in the meantime.

It is commonplace that investigators are used in litigation or proposed litigation to obtain statements and procure evidence. To some extent it is necessary to exercise judgments about relevance and the like that are similar to the exercise of legal skill. But it cannot be suggested that merely to do this for the purpose of submitting the material to a solicitor for use in connection with a claim is undertaking legal practice.

Section 7 deals with CFA insurance policies. This section is in the following terms - “ A Insurance Policy The Conditional Fee Arrangement Insurance policy provides the client with indemnity against the third party’s costs, both sides disbursements and the policy premium should the claim be wholly unsuccessful. If the Panel Solicitor has varied from the procedures outlined in this manual they must produce written authority from AIH in order that the client can claim indemnity under the policy. In addition, the Panel Solicitor must produce written authority for all disbursements claimed. Should at any stage the Panel Solicitor feel that indemnity should be withdrawn from the client they must first obtain the written approval of AIH. In such circumstances the Panel Solicitor should write to AIH outlining the situation of the ‘change of fact’ that has taken place along with all supporting evidence. The matter will then be considered and thereafter a decision will be given to the Panel Solicitor. The Panel Solicitor is not entitled to seek indemnity in relation to disbursements incurred where there has been an error of judgement on their part This can be either in accepting the case or continuing on when there has been a clear ‘change of fact’. This does not relinquish any claim the client may have in respect of negligence on the part of the solicitor concerned. Should at any stage the prospects for the success of the claim fall below 51% the Panel Solicitor MUST immediately notify AIH. Any material fact that in anyway affects the prospects for the success of the claim should be immediately advised to AIH.”

It seems that this insurance policy is an essential part of the entire scheme. It is the indemnity provided by the policy which, of course, will be in question when unnecessary disbursements are incurred. AIH requires that, for the purpose of obtaining an initial medical report, instructions should be sent “direct to medico legal consultancy”. Where this is not appropriate “permission must be sought from AIH to use an alternative medical expert”. Quite what the medico legal consultancy is does not appear from the material but I assume that it is a referral list of doctors that AIH considers to be appropriate. It is clear, as it seems to me, that the solicitor nevertheless has a responsibility to ensure that an appropriate medical expert is consulted and if he or she considers that someone other than being a part of the medico legal consultancy should be used, the solicitor of course is obliged to follow his or her own judgment. A refusal of permission by AIH must be immaterial to this exercise of professional responsibility. The consequences of non-compliance with a refusal by AIH, should that occur, cannot redound to the client’s disadvantage although there may be consequences in connection with the insurance policy. I do not that think that, in this situation, by requiring solicitors to use the medico legal consultancy or obtain permission AIH is conducting a legal practice. It is simply acting as any insurer is entitled to do. The point is specifically made in the manual that a credit is given by AIH for the purpose of obtaining medical reports and it is not unreasonable that AIH should decide the cases in which it will be prepared to advance credit. So far as additional medical reports are concerned, they “should only be obtained with the express permission of AIH”. This requirement is explained as follows – “It must be remembered that proportionality (the extent of costs and disbursements against the size of the claim) and whether further disbursements are justified may be the subject of scrutiny even when costs are assessed. The Panel Solicitor should also remember that they would only be able to recover disbursements which are recoverable at Assessment on a party/party basis.”

So far as it goes, this is a perfectly proper consideration to bring to the solicitor’s attention and must at all events be a relevant matter when considering whether further medical opinion should be obtained. This is in the client’s interest. The manual makes it clear that if prior authority is not sought or obtained in relation to additional medical reports “indemnity in relation to the cost of the second report will not be provided”. Again, I do not see that this is any interference with the due undertaking by a solicitor of his or her professional obligations to the client. Nor does it amount to the undertaking of legal work.

Similarly, the requirement that the Panel Solicitor “should only instruct counsel with the authority of AIH” has the possible consequence, if it is not complied with, that indemnity will not be provided. The solicitor is not bound to comply with the condition. He or she is bound to act in the client’s interests, one of the aspects of which would be whether indemnity for the cost of briefing will be provided.

Section 3 of the manual deals with reporting to the client. The solicitor agrees that there will be no contact with the client on a referral before the case has been accepted. I do not see any impropriety in such an agreement. The manual points out that failures by the solicitor to advise a client of progress in his or her case is a common complaint and therefore requires the solicitor to send to the client at least one letter a month, even if nothing has happened on the file. I think this is excellent advice. The manual points out that, once a medical report has been obtained, the Panel Solicitor should obtain the client’s instructions on its content and, if counsel’s opinion has been sought the solicitor should obtain the client’s instructions on that opinion. The manual requires all offers of settlement to be referred to the client and acceptance of any offers must be in writing from the client. It is suggested that where the client has the benefit of an insurance policy he or she should be reminded in writing when the written acceptance of the offer is received, that the client has given authority for the cost of the insurance and interest to be deducted from their settlement. It does not seem to me that any of these requirements are unreasonable. To the contrary, it would be good if all solicitors practiced in this way. Still less do they smack of undertaking by AIH of legal practice.

Secton 4 of the manual deals with the seeking of authority from AIH for actions to be taken. It is clear, I think, that the authority referred to is for actions in respect of which indemnity or credit will be sought. In my view, it is reasonable that AIH’s authority in respect of these matters should be sought. There is no suggestion in the manual that the solicitor should not or, indeed is not bound to follow his or her own professional judgment in the conduct of a matter, even if that might involve either not obtaining the authority from AIH or proceeding with some action when authority has been refused. The consideration of the question whether authority should be given is not the undertaking of legal practice in the relevant sense, although AIH may need to exercise some legal judgment in respect of its own decision-making. This section ends with the following passage – “ Panel Solicitor’s Views A Panel Solicitor must form their own views on each individual case. A Panel Solicitor should not send a case to AIH requesting how they should proceed in the matter. A Panel Solicitor should suggest a course of action and then seek authority to proceed from AIH. AIH are not a mechanism for telling Panel Solicitors how to progress files. Whilst advice is available, the primary function is concerned with authorising certain action in line with this manual and considering indemnity issues.”

There is nothing in this matter which, to my mind, suggests that AIH is undertaking legal practice.

There are some changes that were made to the manual in 2005. Although I do not think that there are any significant changes, it is probably worthwhile to refer to several differences. The brief overview now contains a statement that the investigation department “is headed up by a qualified solicitor whose experience and expertise is in the personal injury and litigation field”. The use by AIH of a qualified solicitor to enable it to determine whether it will refer a matter is not the conduct by it of legal practice, it is merely a mode of informing itself whether or not the case is an appropriate one for referral. It appears at all events that this manual has been further amended in this particular respect by substituting for the “qualified solicitor” a “registered private investigator” and changing references to “advisers” to “investigators”. These changes do not lead me to change my view about the nature of the manuals.

It is necessary however, for the purpose of the plaintiff’s case, to consider not only the manuals but the surrounding documentation and the correspondence with enquirers. I now move to these matters. As it happens, AIH have referred at least 178 persons to solicitors in New South Wales between July 2003 and October 2006. The following examples of correspondence concern come from that class.

Typically the first document received by a solicitor is a letter from AIH in the following terms – “Please find enclosed for you attention a matter where a client has requested legal representation – can you help? The client sustained a back injury as a result of lifting a motor with metal bar while walking backwards down a plinth. The client felt immediate pain and a tear in his back. The client underwent therapeutic massage and was referred to physiotherapy for treatment. The client still remains in pain. The client has lodged a claim with insurer Allianz. Please review the enclosed paperwork pertaining to this matter with a view for acting on the client’s behalf. We enclose herewith Acceptance Form, which should be faxed back on 02 92475499 and we look forward to hearing from you. Should you have any queries whatsoever, please do not hesitate to contact myself directly on 02 92475466.”

The Acceptance Form sent to AIH by the solicitor acknowledges receiving the papers in relation to the claim, accepting the matter, and asking AIH to inform the client that a particular solicitor is now acting. The acceptance requests AIH to “undertake a factual investigation into the claim…and issue an invoice for the work undertaken to date”. A statement setting out the details of the accident in question is provided by AIH together with a supporting document such as medical certificates and correspondence with any insurers – generally available in relation to workers compensation cases. The client will have signed an authority in the following form - “I the undersigned hereby confirm that I was involved in an accident/incident on the date stated below as a result of which I have sustained the personal injury, details of which are outlined below. I authorise Australian Injury Helpline Ltd to prepare any statements, photographs, sketch plans etc, which in their opinion are required to assist in assessing the prospects of the claim. If upon investigation should the Australian Injury Helpline Ltd consider there would appear to be at least 51% chance of establishing liability in part or totally against a third party I authorise them to instruct a solicitor on my behalf who is to handle the matter on a conditional fee basis [no win – no fee]; or Alternative, should Australian Injury Helpline Ltd consider there to be prospects for a successful claim under the Workers Compensation Act or ComCare I authorise them to instruct a solicitor to act accordingly. I confirm my name, address and contact telephone numbers are as follows – [Details] The accident/incident occurred on [details] I sustained the following injuries (describe briefly all injuries sustained): [Details] I hereby certify that the information contained on this form is true and complete. I accept that I will be held liable for any costs incurred should it at a later date become clear that the information I have supplied either herein or separately is incorrect and/or misleading. [Signed, dated]”

On occasions the solicitor might seek a conference with the client before deciding whether or not to accept the referral. In those cases AIH sends a letter in more or less the following terms – “We write with further reference to the above matter and our previous correspondence in this respect. As advised, we are happy to comply with your request for an initial conference with the client on this occasion and as such, the client has been advised that your office will be in contact shortly in this respect. We also enclose herewith the paperwork pertaining to this matter and our Factual Report, as per your request. In the event that as a result of your conference with the client, you come to the conclusion that there is not a viable claim on his behalf, we would request that you please do not advise the client of this fact but simply state that you are referring the matter back onto our office and that we will re-contact the client shortly. We would thereafter request that all documents are returned onto our office. We thank you for your assistance here and look forward to hearing further from you pending your conference with the client.”

(I interpolate that, providing the solicitor makes it clear to the enquirer that his or her assessment of the prospects of the claim in the event that it is concluded that they are insufficient to justify proceedings will be given to AIH and not to the enquirer, I do not see that there is anything inappropriate with the solicitor agreeing with this condition. After all, the very point is that the solicitor has not agreed to accept the inquirer’s instructions and the enquirer has certainly not retained the solicitor to act.)

On occasions the Panel Solicitor wrote to AIH in respect of a number of (identified) enquirers saying – “I am prepared to accept instructions to act for each of them providing I am satisfied that there are reasonable prospects of success and sufficient quantum to warrant the action. As soon as I have been able to determine in each matter liability prospects and quantum, I will advise you further. Where necessary, please prepare factual investigations and provide further information.” This seems to me to be a completely proper response and enquiry.

In another letter from a Panel Solicitor referring to an enquirer, the information provided by AIH is set out with the observation that it is insufficient to permit an assessment of the prospects or to accept the referral. The solicitor says that with more information, the assessment and acceptance could be made and requesting an opportunity to confer with the enquirer to enable the assessment. It seems to me, again, that this is a proper response to the issue. AIH responded by agreeing to the conference. A great deal of other correspondence has been tendered providing some repetition and some variation of these themes. I do not see any correspondence which suggests that the solicitor, having accepted instructions to act, has done anything more or less than acted in accordance with his or her professional obligations. Nor do I see anything in that correspondence which suggests that AIH is conducting or providing legal services in the sense of interfering with the conduct by the solicitor of the matter on behalf of the client.

However, this is not the whole picture and it is necessary to consider also the terms of correspondence between AIH and the enquirer. One letter of 24 August 2006 written to an enquirer is in the following terms – “We write with further reference to your potential compensation claim and would confirm receipt of the incident report received you. Many thanks for sparing the time; it was of great assistance. We are an independent Company here to assist you in ensuring you receive professional advice in relation to the potential compensation entitlement to which you would appear rightly entitled – all at no charge to you. Based on the information and paperwork provided, it would appear that there could well be grounds for a compensation claim on your behalf. In order to determine whether this is in fact the case while taking into consideration the current state of liability law in your State, we are proceeding to have your matter referred onto a Specialist solicitor for review in order to obtain their considered opinion on the matter. The solicitors are Specialists in Personal Injury law and therefore have the expertise and experience to advise with respect to your potential compensation entitlements. We note however that it would appear that you have not ledged a compensation claim with the Dooley’s Hotel insurer as yet. Please note that this aspect is essential in order to pursue your potential lump sum entitlements and we would therefore urge you to proceed to lodge this claim ASAP! Upon hearing further regarding the potential claim, we shall be in contact with you directly. In the meantime, should you have any queries whatsoever, please do not hesitate to contact myself direction on….”

The phrase in the third paragraph “there could well be grounds for a compensation claim on your behalf” strikes me as at least having the colour of a legal opinion. However, its provisional nature is immediately demonstrated by the following sentence, which indicates that “to determine whether this is in fact the case” the matter will be referred to a solicitor for review. It seems to me that it cannot in any sensible way be suggested that this was a letter that gave legal advice. The scheme of course depended on the process by which the Panel Solicitor, in every practical sense, made the decision whether the prospects of success warranted the institution of proceedings and, hence, referral although a refusal to accept referral was communicated to AIH not the enquirer. On the assumption that AIH communicated the refusal to the enquirer, stating the reason for it, this would not in my opinion be engaging in legal practice providing it was made clear that the refusal to refer arose from AIH’s acceptance of advice that it had been given.

The plaintiff relied on several examples of letters sent to enquirer in New South Wales. The first of these, dated 13 June 2006 is said, at the top of the letter to be “Without Prejudice” (I do not understand what the effect of this mantra is; it seems to me to be meaningless) and goes on to state – “Dear John Re: Your Mother in law’s Potential Compensation Claim Further to our telephone conversation with you, firstly we would like to thank you for your enquiry and we hope that you are ‘on the road’ to recovery from the injury sustained. We confirm that we are prepared to provide you with advice and assistance in relation to the matter, completely FREE of charge. Many thanks for supplying the initial information over the telephone. To speed this matter up and enable us to build up a complete picture of the events and thereafter supply you with a free and ‘considered’ view on the potential claim, we would request you to: · Answer all the relevant questions, which have not been completed on the enclosed form. · Supply a detailed description of the events surrounding the injury sustained. · Sign and date the enclosed Incident Report Form. · Please outline the extent of the injuries sustained, the treatment prescribed and the prognosis? · Please supply any medical evidence available. Please supply copies of the medical notes from the hospital concerned, which are available for a small administration fee. · Please supply as much information and documentation as possible, particularly relevant would be any correspondence received from the insurer concerned. We can confirm that to supply you with a ‘considered’ view on these matters there will be NO CHARGE to you. Therefore, please get all the documentation relating to this matter back to us by return of post. Should there be any aspect of the matter you wish to discuss, please do not hesitate to contact myself directly on 1300 721 684 . Thanks”

(It is obvious that this is a form letter churned out of the word processor from the fact that although it concerns the potential compensation claim to be made by John’s mother, the opening sentence expresses the hope that John is “on the road to recovery from the injury sustained”.)

The second sentence promises the provision of “advice and assistance in relation to the matter” which necessarily concerns the potential compensation claim. It is not clear whether this help is of a legal character but, in the context, this is one strongly available implication. The penultimate paragraph confirms the ambiguity of the nature of the help, the “’considered’ view on these matters” suggesting a legal opinion although the fact that “considered” is itself in quotes suggests some qualification. It is difficult to avoid the conclusion that these ambiguities are deliberate and that, although AIH does not wish to state that it is going to provide legal advice – and it plainly has no intention of doing so – it wishes the client to think that it might well be doing so, a case I think of suppressio veri, suggestio falsi.

The giving of advice as to the legal character and prospects of potential litigation, especially implying that this would be done following a detailed assessment of evidentiary materials supplied by the person in question is unarguably engaging in legal practice. A statement that this is what will be done necessarily implies that the person to be proffering the advice is entitled to do so. In my view, letters of the kind of which the above is obviously but one an example, are prohibited representations within the meaning of s 15 of the Act.

A second example of a letter (dated 24 August 2006) to an enquirer, also stated to be “Without Prejudice”, is in the following terms – “ Re: Your Potential Compensation Claim “We write with further reference to your potential compensation claim and would confirm receipt of the incident report received you. Many thanks for sparing the time; it was of great assistance. We are an independent Company here to assist you in ensuring you receive professional advice in relation to the potential compensation entitlement to which you would appear rightly entitled – all at no charge to you. Based on the information and paperwork provided, it would appear that there could well be grounds for a compensation claim on your behalf. In order to determine whether this is in fact the case while taking into consideration the current state of liability law in your State, we are proceeding to have your matter referred onto a Specialist solicitor for review in order to obtain their considered opinion on the matter. The solicitors are Specialists in Personal Injury law and therefore have the expertise and experience to advise with respect to your potential compensation entitlements. We note however that it would appear that you have not ledged a compensation claim with the Dooley’s Hotel insurer as yet. Please note that this aspect is essential in order to pursue your potential lump sum entitlements and we would therefore urge you to proceed to lodge this claim ASAP! Upon hearing further regarding the potential claim, we shall be in contact with you directly. In the meantime, should you have any queries whatsoever, please do not hesitate to contact myself direction on 300 721 684.”

This letter is more carefully drawn and, as it seems to me, does not suggest that AIH intends to give legal advice although the penultimate paragraph contains a strong suggestion which might be read in that way. I do not think that the letter would imply to a reasonable person that the solicitor is employed by AIH, especially because of the phrase “referred on”, though the matter is susceptible of some ambiguity. On the whole, I conclude that letters in this form do not hold out that AIH is engaging in legal practice.

The Society also points to what is suggested to be a typical tax invoice, in this case dated considerably earlier than the letters to which I have adverted namely, 21 August 2003. The invoice is addressed to solicitors dealing with a client accepted by that firm under the referral scheme. So far as is material this document reads - “ GST TAX INVOICE – ABN 76 095 175 107 To: Upon request, initial discussions with Ms… about her rights under Workers Compensation Act and the legal process in ‘general’ Interviewing and taking details and statements from Ms…about the potential claim and assisting her in this respect, particularly in relation to Workers Compensation Act and outlining the options available Undertaking investigations into the circumstances of the incident concerned, liaising with the client and report to the client’s solicitor. Assisting Ms…in relation to this matter and in collation of all documentary evidence. General discussion with Ms…regarding legal differences and options available. Reporting to the client’s solicitor over the factual aspects of the client’s claim. Including all miscellaneous expenses such as telephone calls, call centre charges, photocopying, travelling, postage, incidental Expenses etc $700.00 + GST @ 10% $ 70.00 Total $ 770.00 Payment is strictly 7 days ”

Of concern to the Society is the claim that AIH discussed with the client to rights under the Act, the relevant legal processes, outlined her “options” in relation to claims under the Workers Compensation Act and discussed with her the “legal differences and options available”. Certainly these claims are strongly indicative of undertaking of legal work, especially with a client who may not understand the precise capacity in which the AIH investigator gave the advice or consulted with her.

No evidence was led by AIH as to the mode by which it conducts its business and no attempt was made to explain what might be regarded, at the very least, as strong indications about the provision of legal services. In the absence of any evidence about what occurred from which it might be concluded that the invoice should not be accepted on its face, it seems to me that I am justified in inferring that AIH has from time to time indeed engaged in legal practice of the kind it has described in its own words. Furthermore, it has on occasions given its enquirer to understand that it is in a position to offer legal services relating to the making of claims for compensation or damages and thus is entitled to do so. Moreover, I think that the correspondence shows that it considers that it is commercially advantageous, even if the representation is not directly made, to use language which is calculated to convey that impression to lay persons. It is clear that, at least indirectly, this conduct is undertaken for “fee, gain or reward” within the meaning of s 14 of the Legal Profession Act 2004.

The Society has also tendered material relating to the nature of the charges imposed by AIH on solicitors – and by implication on the clients – which had been drafted with a view to enable those fees to be recovered as a disbursement from the unsuccessful defendant in the event of a satisfactory conclusion of any claim. There are examples of circulars to solicitors that set out changes to the way that invoices are set out to enable them more readily to be accepted as disbursements. There is indeed an element of construction in those documents which suggests that the charges are not adequately transparent and give sufficient disclosure for the purpose of enabling a proper assessment of costs either by an unsuccessful defendant or an officer of a court. Of course, any solicitor who was less than properly candid in seeking payment of costs is in breach of professional responsibilities. I certainly do not wish to suggest that any of the solicitors to whom I have made reference have acted or would act inappropriately. But I think the Society’s point that there appears to be a manipulation of the cost recovery process is well taken. I do not have to consider this matter any further since the particular issues are not before me and I do not see this matter as relevant to a consideration of the relief sought by the Society. But this is a matter that warrants some further inquiry. Conclusion

I have concluded, therefore – (i) that Regulation 34 of the Legal Profession Regulation 2005 is not authorised by the Legal Profession Act 2004 and is invalid; and (ii) that AIH is in breach of ss 14 and 15 of the Legal Profession Act 2005.

It seems to me that I should order that the defendants be restrained from engaging in legal practice in contravention of s 14 of the Legal Profession Act 2004 and from representing that they are entitled to engage in legal practice in contravention of s 15 of the Legal Profession Act 2004.

I order the plaintiff to pay the defendants’ costs in relation to the alleged contravention of the Legal Profession Regulation 2005 and the defendants to pay the plaintiff’s costs in respect of the contravention of ss 14 and 15 of the Legal Profession Act 2004.

I reserve liberty to apply on 14 days’ notice in respect of the forms of the orders.