What are ILPs/MDPs
What is an incorporated legal practice?
An incorporated legal practice (an ILP) is a corporation (typically a company within the meaning of the Corporations Act) that provides legal services and that may provide other services in addition to legal services.
The Legal Profession Act 2007 establishes the regulatory framework for the provision of legal services by an ILP at Chapter 2 Part 2.7 (sections 109-143). Notably:
- any corporation is eligible to be an ILP unless it is prohibited by an Act under which it is incorporated or which regulates its affairs;
- a corporation intending to engage in legal practice in Queensland must give written notice in the approved form to the Queensland Law Society (QLS) of its intention before commencing legal practice in Queensland;
- the Supreme Court can make an order disqualifying a person from being an officer or employee of an ILP, or from being engaged or paid to provide legal services on behalf of the ILP;
- an ILP must not conduct a managed investment scheme or any other business or service prohibited by regulation.
Crucially:
- an ILP must have at least one director who is a legal practitioner (a ‘legal practitioner director’) and, if it ceases to have a legal practitioner director, it must make sure that it remedies that fact within 7 days or cease to engage in legal practice;
- the legal practitioner directors of an ILP and any other legal practitioners who provide legal services on behalf of an ILP have the same professional obligations as all other legal practitioners;
- the legal practitioner directors of an ILP have additional obligations over and above their professional obligations as legal practitioners. There are others (go to ILP investigations to see a comprehensive list), but their key additional obligations are:
- to ensure that the ILP implements and keeps ‘appropriate management systems’ which ensure that the ILP meets the same standards of legal practice expected of any other legal practice; and
- if it ought be reasonably apparent that those standards might be or have been breached, to take all reasonable action to ensure that the standards are not breached or, if they have been breached, to take appropriate remedial action.
What is a multi-disciplinary partnership?
A multi-disciplinary partnership (MDP) is a partnership between one or more legal practitioners and one or more persons who are not legal practitioners that provides legal services and other services in addition to legal services.
The Legal Profession Act 2007 establishes the regulatory framework for the provision of legal services by a MDP at Chapter 2 Part 2.7 (sections 109-110 and 144-161). Notably:
- a legal practitioner who intends to engage in legal practice as a partner in a MDP must give notice to the QLS in the approved form of his or her intention before commencing legal practice in Queensland as a partner in the MDP;
- a legal practitioner partner of an MDP and any other legal practitioners who provide legal services on behalf of a MDP have the same professional obligations as all other legal practitioners;
- a legal practitioner partner of a MDP has additional obligations over and above their professional obligations as legal practitioners. The Act makes them responsible for the management of the legal services provided by the MDP and, in particular, requires them:
- to ensure that the MDP implements and keeps ‘appropriate management systems’ which ensure that the MDP meets the same standards of legal practice expected of any other legal practice; and
- if those standards are breached, to take appropriate remedial action.