Occasionally, a legal practice either fails to, or is unable to protect the interests of its clients. This might happen because of a lawyer’s alleged improper conduct, insolvency, ill health or death.

In such situations, we have the power to take steps to intervene in the operation of the practice to protect client funds and their ongoing legal matters.

We can appoint a Supervisor to manage a practice’s trust account, or a Manager to take over the management of an entire practice. In certain circumstances, we may also ask the Supreme Court of Victoria to appoint a Receiver to attempt to recover the trust money or trust property of clients.

Supervisors

A Supervisor has the powers and functions of the law practice to manage the practice’s trust money and trust accounts only. A Supervisor is typically appointed where we believe that there are inadequacies in how the law practice has handled and accounted for trust money.

A Supervisor’s duties may include: reconstructing trust records; operating and authorising trust account transactions; implementing suitable and compliant procedures for handling of trust money; and if necessary, giving evidence in civil and/or criminal proceedings arising from the intervention.

Managers

A suitably qualified lawyer may be appointed as a Manager of a law practice to allow the law practice to continue to serve its clients.

There are many circumstances where it may be necessary for us to appoint a manager to a law practice, and managers may be appointed to practices that specialise in all areas of the law.

A Manager has the power to supervise the operations of the legal practice (including its employees), and analyse the law practice’s business systems and implement measures necessary to ensure that the practice meets its obligations to its clients, employees and other stakeholders. A Manager also has the power to wind-up the affairs of the law practice, if such action is appropriate.

Receiver

Where necessary, we can apply to the Supreme Court of Victoria to appoint a Receiver to a law practice. A Receiver may be appointed by the Court where a Supervisor or Manager has previously been appointed and the Court determines that it is appropriate in the circumstances to convert the arrangement into a receivership.

The Receiver uses his or her statutory powers to trace and recover trust money and trust property, and can take all necessary steps to wind up and terminate the affairs of a law practice.