Injury Claim Crackdown Could Falter
Sydney Morning Herald
Saturday June 18, 2005
A State Government crackdown on advertising by companies that "harvest" personal injury claims could be ineffective because the office charged with policing it has no power over non-lawyers.
Legal firms were banned from advertising for negligence work last year as part of the Government's changes to tort law. But advertisements soon emerged urging people to contact personal injury hotlines or websites.The companies involved would sign up potential claimants and refer them to plaintiff lawyers for a commission.Last year's prohibition - outlined in regulations governing the Legal Profession Act - has been challenged in the High Court and a decision is expected shortly.The Legal Services Commissioner, Steve Mark, has said he has more than 40 potential prosecutions pending the outcome and is concerned the hotlines were circumventing the law.The latest regulation, which was gazetted on Wednesday, seeks control over non-lawyers and bans advertising which involves "an arrangement for the referral of persons to a lawyer for the provision of legal services for the recovery of money". But Mr Mark only has authority to prosecute legal practitioners, leaving hotline companies - such as the Australian Injury Helpline - out of the reach of his office.The Attorney-General, Bob Debus, said in a statement yesterday the maximum penalty had been increased from $1100 to $22,000. His spokesman conceded Mr Mark had no power over non-lawyers but said the NSW Law Society or Crown Law Office could launch prosecutions. During the High Court challenge, several judges expressed concern the ban would stop community legal centres telling people about their rights. The new regulation addresses the problem by giving exemptions to "services provided by community legal centres in connection with domestic violence or discrimination", legal aid offices and industrial organisations.
© 2005 Sydney Morning Herald
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