APLA Ltd & Ors v Legal Services Commissioner NSW & Anor

APLA Ltd and others (the applicants) sought judicial review of a decision by the Legal Services Commissioner of New South Wales (the Commissioner) and the Law Society of New South Wales (the Society) to refuse to grant them a licence to operate as a incorporated legal practice. The applicants were a company and its directors, seeking to establish a law firm that would offer a range of legal services, including personal injury litigation. The Commissioner and the Society had refused the licence on the grounds that the proposed practice would contravene provisions of the *Legal Profession Act 1987* (NSW) relating to the prohibition of the corporate practice of law and the prohibition of the payment or receipt of referral fees. The matter came before Gummow J in chambers.

The primary legal issues before the Court were whether the proposed operations of APLA Ltd constituted the corporate practice of law contrary to the *Legal Profession Act 1987* (NSW), and whether the arrangements for the referral of work and the sharing of fees between APLA Ltd and other entities would contravene the prohibitions against the payment or receipt of referral fees and the division of legal fees with non-lawyers. The applicants contended that their proposed structure and business model were lawful and did not offend the spirit or letter of the legislation.

Gummow J considered the relevant provisions of the *Legal Profession Act 1987* (NSW), particularly those concerning the definition of legal practice and the restrictions on incorporated legal practices. His Honour analysed the proposed business structure of APLA Ltd, including the roles of its directors and the proposed arrangements for the provision of legal services. The Court examined the nature of the relationship between APLA Ltd and any associated entities, and the flow of fees, to determine if these arrangements amounted to a prohibited division of legal fees or the corporate practice of law. The principles applied focused on the statutory interpretation of the *Legal Profession Act 1987* (NSW) and the established understanding of what constitutes the practice of law in New South Wales.

The Court found that the proposed operations of APLA Ltd, as described, would indeed constitute the corporate practice of law and would involve prohibited fee-sharing arrangements contrary to the *Legal Profession Act 1987* (NSW). Consequently, the application for judicial review was dismissed.