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"Victorian Law Reform ... made by lawyers, for lawyers ..."

Details: Category: Victoria DHHS; Created: Tuesday, 12 November 2013 11:59; Written by Diarmuid Hannigan

Diarmuid Hannigan 2ab27 The review of our succession laws report has now been completed by a panel comprised wholly and solely of lawyers, (not one person to represent families or our community with so much wealth at stake. I wonder why). It should be noted that one of the members of this panel was a past president of The Law Institute of Victoria, (The lawyers union) and another member Richard Boaden, barrister from “Jarndyce Chambers.”

The terms of reference clearly state that the objective of the review is to ensure the law operates justly and fairly and in accordance with community expectations in relation to the way property is dealt with after a person dies.

Our current laws have provided the legal profession with an enormous feeding ground that extracts money from vulnerable families and benefits the pockets of lawyers. In Victoria approximately 40,000 people die each year leaving an average estate worth at least $500,000 an amount of $20 billion per annum. The legal industry is entrusted to transfer this wealth from the dead to the living. The current process is inefficient, expensive, unaccountable, and full of deceptive procedures that allow lawyers to hide important information from family members.

It is a system that has evolved through time that has been developed by the legal industry so as to obtain maximum benefit for themselves. At a ten per cent processing cost by the legal profession this amounts to an annual contribution of at least $2 billion per annum in revenue to the legal profession. There are 16,000 lawyers in Victoria about half would be employed in areas that would not share in this feast. If we say 8000 lawyers share in $2 billion that calculates out to $125,000 per lawyer per year, a significant component of the legal industry.

The new laws should address this [disgusting] situation, however the recommendations from this report do nothing of the sort. To appease the worst case and most obvious aspects of these unfair laws, the committee made up of lawyers has recommended that "lawyers who are acting as executors should be incorporated into the legal professional act which would allow the Legal Services Commissioner to investigate complaints by beneficiaries against their behaviour". Behaviour mind you, that can involve theft and fraud. We should all now feel safe as The Legal Services Commissioner receives 7000 telephone enquires about bad lawyers every year. They are able to discourage 5000 of those complaints over the phone and only receive 2200 written complaints. Of the written complaints they find about 2000 complaints have no merit and only investigate or prosecute 200 complaints. In other words we are going to use a broken system to fix a very broken system.

This recommendation is a furphy as lawyers who are executors should have always been bound by the Legal Professional Act of 2004 because if they were not bound they would be contravening the Trade Practices Act of 1974 by advertising their services to customers as lawyers when knowing full well that when acting as executors they would not be bound or regulated by the lawyers rules, in other word’s misleading and deceptive advertising of their services to naive consumers.

Amendments and Notations required to be inserted into this document :

7.10 It is therefore concerning that some legal practitioner executors have taken unfair

advantage of their position by:

• charging the estate without the informed consent of the will-maker or beneficiaries

• claiming excessive amounts

• receiving both commission and professional fees for the same services.3

Should also be inserted.

By lying to the children of the deceased about their parents’ wishes and hiding relevant documents so as to be able to increase their fees and charges against the estate.

7.11 In this chapter, the Commission considers a number of measures to reduce the incidence

of unethical and unlawful charging practices by legal practitioner executors. Its

recommendations aim to improve compliance by legal practitioner executors with their

ethical and legal obligations, and assist beneficiaries in understanding those obligations

and enforcing them when necessary. They also recognise that some of the problems

identified are not confined to the legal profession and need broader solutions.

There is no mention of criminal sanctions against this foul behaviour, there needs to be. It is hard for one lot of lawyers who protect the other lot to cll them criminals.

7.12 Decisions about whether specific rules for legal practitioners are necessary, and the form

they should take if they are, need to be made in the context of the existing regulatory

framework. The regulatory framework within which legal practitioner executors currently

operate is described briefly in the next section. The discussion then turns to the rules that

should apply.4

This is one of those legal gobbled de gook sentences that says we think that there is a need for some specific rules but we are not saying there is a need for them because we may be sued for our past negligence on the issue. It also says that if we do actually create some rules then they will be formed within the existing legal frame work which as we know already protects crooked lawyers.

The review has also recommended that the Law Institute of Victoria write the guidelines for these lawyers who are executors so as they can be incorporated into the legal professional act of 2004, a bit like asking Dracula to write the rules on how to manage the blood bank. At least they have admitted to their negligence.

There is nothing in this report about quality standards, making the process more efficient or incorporating the philosophy of human rights into the law. Family development and culture do not even rate a mention in this review, a review of our inheritance laws that will determine the way this nation develops. This review is indicative of a legal system that allows unaccountable lawyers to write the laws, and interpret and administer the laws for their benefit instead of for the development of our nation.

There is nothing in this review that mentions executors who are lawyer’s responsibilities to share important information with beneficiaries (family members) as is mentioned in the national review of unifying Australia`s Inheritance laws. Transparent communication between lawyer/ executor and family is an essential component for avoiding disagreement and reduces legal costs to the estate.

There is nothing about capping the legal costs on a deceased estate. After all is not rocket science.

61 The Law Institute of Victoria or other relevant body should make:

(a) uniform rules under the new uniform law that clarify the duties of legal

practitioners in providing executorial services and charging for those services

(b) in support of these rules, guidelines for legal practitioner executors on meeting

their fiduciary responsibilities.

The Law Institute of Victoria should have done this years ago getting them to do it now is akin to getting Dracula to write the rules for running the blood bank. We only need one rule which already exists but the regulators do not enforce it and that is that they comply with Australian Consumer Law.

The law reform Commission in its review of Succession laws could quite simply have stated that all lawyers who act as executors are obligated to Australian Consumer Law and that beneficiaries of deceased estates are consumers of their serves as should have always been the case after the Trade Practices Act of 1974 was enacted, instead of perverting the course of justice by running around the Legal Professional Act of 2004 which is just another smoke screen by the profession to avert their responsibilities to Australian Consumers of their services.

The reason this has occurred is because our legal system has grown from a convict settlement a settlement that was stripped of culture and had no recognition of family as the core and fundamental component of our society. Until the law reform process is changed and culture and families are given the positions of influence and power when law is constructed our nation will remain a prison that is controlled by greedy self-serving and unaccountable lawyers whose sole purpose in life is to feather their own nests.

At the beginning of this letter I mentioned two points about two members of the advisory committee. The first was that one of the members was an ex-president of the Law Institute of Victoria, The reason is obvious the legal profession needed one of their own to report back to its central committee to ensure that their income stream is well protected from any recommendations of law reform

The second related to Richard Boaden, barrister from “Jarndyce Chambers.”

Jarndyce vs Jardynce was the fictional name used by Dickens in Bleak House and is a description of the longest and most expensive wills case that ran for 120 years and eroded the whole estate in legal fees.

For any person who has been a victim of legal abuse in a deceased estate this is a pointer to the hubristic culture of the Victorian Legal Profession both by calling a barristers chambers by this name and worse still appointing a barrister from those chambers to sit on a review committee on succession law.

If as a responsible member of our community you do not believe in the she`l be right attitude (trust us) projected by our legal profession, stand up against this travesty and ensure that these recommendations by the review panel of Victoria’s Succession laws are seen for what they are, “She is wrong” and help influence the debate so as we do end up with succession laws that are representative of our community’s needs, expectations and culture, instead of meeting the needs of the legal profession, a profession who have become far too powerful and have proved time and again that they cannot be trusted with the shaping of our nation to benefit our culture and our families.

I have included links to my submissions to the Succession Law Reform Committee for your reference.

http://www.lawreform.vic.gov.au/sites/default/files/Submission_3b_Diarmuid_Hannigan.pdf

it is also connected to the initial submission link http://www.lawreform.vic.gov.au/sites/default/files/Submission_3a_Diarmuid_Hannigan.pdf

this is on the law reform commission web site link http://www.lawreform.vic.gov.au/projects/succession-laws/submissions/succession-laws-received-submissions

I trust you will see through the veneer of trust projected by the legal profession and use your influence to help protect the interests of Australian families.

We have a once in a hundred year opportunity to reshape our legal profession through Succession law reform and make them provide our community with a low cost efficient and accurate system that has a culture of collaboration, truth, transparency and trust incorporated into its structure, where culture and the input of community and family are very much participants in shaping our laws and where the legal system becomes accountable to Australian Consumers.

I have also included segments of the review on succession pertaining to the behaviour of lawyers who act as executors with my comments in italics for your benefit. I trust this information is helpful and look forward to your participation.

Best Regards

Diarmuid Hannigan

Executors’ costs and commission

Special rules for legal practitioner executors

35 There are cogent reasons why legal practitioners are appointed as executors, and it is in the

community’s interest that they continue to provide executorial services. Most act in the best

interests of will-makers and beneficiaries, as is their duty, but there is persistent concern that

legal practitioner executors who also provide legal services to the estate are charging twice

for some of the same services. The terms of reference ask the Commission to review whether

there should be special rules for these executors.

36 Although a will-maker may select a legal practitioner as executor because of their legal skills

and knowledge, the provision of executorial services is not regulated under the Legal Profession

Act 2004 (Vic), which regulates the provision of legal services by legal practitioners to their

clients. An executor has a duty to act in the interests of the beneficiaries, but a beneficiary

is not the executor’s client. Most of the safeguards, rights and avenues for dispute resolution

that are available to clients under the Legal Profession Act are not available to beneficiaries.

37 New uniform law for regulating the legal profession in New South Wales and Victoria is

expected to be introduced in 2013. The Commission has not seen the new legislation but

understands that the treatment of executorial services will be unchanged. The Commission

makes a series of recommendations that would:

• require legal practitioner executors to disclose to beneficiaries an estimate of what

they will charge the estate for executorial and legal services

• extend the jurisdiction of the Legal Services Commissioner to resolve disputes about

services provided by legal practitioner executors and charges of $25,000 or less for

executorial services

• allow a beneficiary to apply to the Costs Court for review of legal costs.

38 Some legal practitioner executors who are authorised by a will to be paid commission choose

instead to charge a fee for their executorial services, which may be a smaller amount. The

Commission has concluded that it would be useful for legal practitioners and beneficiaries

alike if there were a statutory provision that clearly permitted them to do this, and has

recommended accordingly.

39 The legal profession makes professional rules of conduct and associated guidelines. A failure

to comply with the rules may amount to unsatisfactory professional conduct or professional

misconduct. The current rules do not adequately address the need to obtain the informed

consent of the will-maker or the beneficiaries in order to be paid commission, or to otherwise

seek court authorisation. In any event, legal practitioners are not always referring to the

rules when administering estates. The Commission recommends new provisions in the

Administration and Probate Act to alert any professional executor (who may be a legal

practitioner, accountant, or financial adviser or other professional) to this requirement

Chapter 7 Executors’ costs and commission

Special rules for legal practitioner executors

51 The Law Institute of Victoria or other relevant body should revise the conduct and practice

rules that apply to legal practitioners who prepare a will or other instrument under which they

receive a benefit to expressly require the practitioner to obtain the client’s informed consent

to the payment of the benefit.

This means that lawyers have been writing themselves into clients wills without even telling the client they are doing so and it is legal, so we now have to change the law so as they can prove they have informed the client.

52 A new provision should be inserted into the Administration and Probate Act 1958 (Vic) to the

effect that a professional executor is unable to rely on a remuneration or commission clause

in a will unless the will-maker gave their informed written consent to the inclusion of the

clause, before the will was executed.

53 A new provision should be inserted into the Administration and Probate Act 1958 (Vic) to

the effect that an executor may receive commission from the assets of an estate provided

that the executor obtains the fully informed consent of all interested beneficiaries.

They will now have to get the consent of all of the beneficiaries, does this not open the door for another legal shit fight.

54 Legal practitioner executors should be required to disclose to beneficiaries details about their

charges to the estate for executorial and legal services, and associated information, along

the lines currently required by section 3.4.9 of the Legal Profession Act 2004 (Vic) in respect

of costs disclosure to clients. In particular:

(a) Costs disclosure to beneficiaries should be required:

(i) as soon as practicable after the law practice or legal practitioner commences

in the position of executor

(ii) as soon as practicable after the law practice or legal practitioner executor

becomes aware of any substantial change to anything included in a disclosure

already made to the beneficiary

(iii) in plain language, which may be in a language other than English if the

beneficiary is more familiar with that language

(iv) by spoken word to a beneficiary of legal capacity who is unable to read.

(b) Costs disclosure to beneficiaries should not be required:

(i) if disclosure in accordance with the obligations currently set out at sections

3.4.9–3.4.18 is made to a co-executor who is not a legal practitioner

(ii) to a beneficiary who is not legally competent

(iii) to a beneficiary whose entitlement under the will is unaffected by payment

from the estate for legal and executorial services.

be capable of constituting unsatisfactory professional conduct or professional

misconduct on the part of any legal practitioner involved in the failure, as currently

applies in respect of disclosure to clients.

What are the disclosure requirements and do they only relate to fees or do they also relate to information sharing I E TRANSPARENCY?

55 Costs disclosure to beneficiaries about their rights to receive information, seek costs review

and make a complaint should be possible by providing a written statement. As is currently

permitted in respect of cost disclosure to clients, the written statement should be prepared in

accordance with the regulations, and supplemented by fact sheets and documents prepared

by the Legal Services Commissioner in consultation with the profession

Why has this not already occurred it’s bloody obvious

56 A new provision should be inserted into the Administration and Probate Act 1958 (Vic) to

the effect that, where a will contains a provision authorising a professional executor to charge

commission, the professional executor may elect to charge fees for executorial work rather

than relying on the provision in the will. The ability to make an election would be subject

to conditions, including that the fees:

(a) do not exceed in total the amount to which the executor would have been entitled

if the executor had not made the election

(b) are calculated at a rate applicable for work that does not require the executor

to use their specialist professional skills

for professional services

(d) where the professional executor is a legal practitioner, are treated as legal costs

for the purposes of the rights of the beneficiaries to apply for costs review by

the Costs Court and make a civil complaint to the Legal Services Commissioner.

Why has this not already occurred it’s bloody obvious

Court review of costs and commission

57 The Supreme Court should have the power to review and vary commission, charges and

disbursements claimed by executors and administrators out of estates. A new provision of

the Administration and Probate Act 1958 (Vic), based on section 86A of the Probate and

Administration Act 1898 (NSW), should provide that:

(a) the court may review all or part of a commission or amount charged or proposed

to be charged in respect of any estate

(b) if it finds it is excessive, the court may reduce it even if it was authorised

by a provision in the will

by this provision should be brought within three months after the time that the

applicant beneficiary first knew, or ought to have known, of all commission,

charges and disbursements charged or proposed to be charged out of the estate.

Why was it not there beforehand and any way since they are useless with their reviews of lawyers charges I cannot see how they would be any different with Lawyer/ executor charges. Why have they not said that if the review finds they have overcharged then that should be a criminal matter in the form of theft?

Other regulatory reform

58 The Legal Services Commissioner should be given jurisdiction to resolve a dispute between

a legal practitioner and a beneficiary under a will about an amount charged to an estate for

executorial services, where the disputed amount does not exceed $25,000. The procedures

for resolving such a dispute would be essentially the same as those that currently apply to civil

disputes under Part 4.2 of the Legal Profession Act 2004 (Vic) and would specify that:

(a) a complaint that involves a dispute about an amount charged for executorial

services must be made within 60 days after the time that the applicant

beneficiary first knew, or ought to have known, of the amount charged

or proposed to be charged

Sixty days is useless

(b) the Legal Services Commissioner has discretion to provide more time as currently

permitted by section 4.2.7(4) of the Legal Profession Act 2004 (Vic) for complaints

that involve a dispute about legal costs

The Legal Services Commissioner is bias to lawyers so this unfairly favours lawyers.

involves a dispute about an amount charged for executorial services may not apply

for review by the court.

Why not?

59 The Legal Services Commissioner should be given jurisdiction to resolve a civil dispute between a legal practitioner and a beneficiary under a will or trust where the dispute relates to services provided by the legal practitioner to the estate in the capacity of executor or trustee. The

procedures for resolving such a dispute would be the same as those which currently apply

to civil disputes under Part 4.2 of the Legal Profession Act 2004 (Vic).

It is stating the obvious and why have they not been doing it and who will be charged with perverting the course of justice.

60 Review of legal costs by the Costs Court, as currently made available to clients and third party

payers by section 3.4.38 of the Legal Profession Act 2004 (Vic), should once again be made

available to a person interested in any property out of which a legal practitioner executor,

administrator or trustee may recover legal costs.

Why is this not already happening.

61 The Law Institute of Victoria or other relevant body should make:

(a) uniform rules under the new uniform law that clarify the duties of legal

practitioners in providing executorial services and charging for those services

(b) in support of these rules, guidelines for legal practitioner executors on meeting

their fiduciary responsibilities.

62 The Victoria Law Foundation should publish a guide, or series of guides, on making wills and

the role of the executor. The information should encompass the following topics and be made

available in community languages:

(a) questions and issues to consider when making a will, focusing on helping

will-makers avoid problems commonly identified in wills made without legal

advice and providing guidance about selecting an executor

(b) practical information for non-professional executors about what they need to

do in that position, focusing on resources that can help them in meeting their

responsibilities and identifying where they may obtain professional assistance

to the assets of a person after they die, focusing on what the executor needs

to do before the estate can be distributed and the basis on which the estate

might be charged for their services.

Why have they sat on their asses?

Appendix A: Advisory committee

The Commission formed a small committee of people recognised for their expertise in the

operation of succession laws to assist in identifying and exploring issues arising from the terms

of reference. Members were asked to contribute as individual experts and not as representatives

of any organisation with which they worked or were affiliated.

The committee met four times, on 2 July 2012, 16 July 2012, 2 August 2012 and 2 May 2013.

The following attended one or more meetings:

• Danny Barlow, director, Riordan Legal

• Richard Boaden, barrister

• Associate Professor Matthew Groves, Faculty of Law, Monash University

• Michael Halpin, Registrar of Probates

• Justin Hartnett, principal, Harwood Andrews

• Mark Maier, solicitor, McNab McNab & Starke

• Stewart McNab, barrister

• Richard Phillips, barrister

• Carol Stuart, community lawyer, Seniors Rights Victoria

• Michael Tsotsos, legal counsel, Perpetual

• Professor Prue Vines, Faculty of Law, University of New South Wales

• Kathy Wilson, special counsel, Aitken Partners

All lawyers not one person representing the community or families.

1.9 When conducting a review, the Commission usually publishes a consultation paper

addressing all of the issues arising from the terms of reference and seeking written

submissions on possible reforms. Because the terms of reference in this case covered

a range of disparate subjects, the Commission instead released six short consultation

papers. Each focussed on one or more key topics as follows:

• Wills—whether there is a need to revise the law on witnessing wills to better protect

elderly and vulnerable will-makers from undue influence; statutory wills;

and ademption.

• Family provision—whether the law is achieving its objective of ensuring that provision

is made for people for whom the deceased person had a responsibility to provide.

• Intestacy—whether the law is operating effectively to achieve just and equitable

outcomes.

• Executors—whether there should be special rules for legal practitioner executors

and whether a court should be able to review executors’ costs and commissions.

• Debts—whether the law governing how a deceased estate’s assets are ordered

to pay its debts can be simplified.

• Small estates—whether there are more efficient ways of dealing with small estates.

. Throughout the reference, and particularly after the consultation papers were released,

the Commission consulted widely. Meetings with legal practitioners were held in Colac,

Shepparton and Wodonga as well as in Melbourne. An open day was held to provide

an opportunity for members of the public to meet with Commission staff to discuss their response to the questions raised in the consultation papers. The Commission held a roundtable on wills, which was attended by representatives of community groups, legal practitioners, academics, State Trustees and the Victorian Civil and Administrative Tribunal. Meetings were held with members of the Law Institute of Victoria, judges and associate judges of the Supreme Court, judges of the County Court, and representatives of private trustee companies.

The feel good statement look we did consult the public we were forced to listen but we are trying hard to protect the interests of the legal profession.

Need for reform

1 This report contains 78 recommendations to reform the law and related practices that affect

what happens to the assets of Victorians after they die. The need for reform has long been

recognised. More than 20 years ago, the Standing Committee of Attorneys-General initiated

a project to develop uniform succession law and practice across Australia. The project was

led by a National Committee for Uniform Succession Laws. By 2009, the project had produced

a series of reports and model legislation.

2 Victoria’s legislation on wills was reviewed shortly before the national project began and the

Wills Act 1997 (Vic) closely aligns with the national model. The Administration and Probate

Act 1958 (Vic), which regulates the administration and distribution of estates, has never been

comprehensively reviewed.

3 Of course, a law that has not been reviewed does not necessarily need reform, and there may

be good reason not to adopt a provision contained in the model legislation. Although requiring

the Commission to have regard to the national uniform succession laws project, the terms of

reference for this review make clear that any reforms should have a sound policy basis:

The purpose of this reference is to:

(a) ensure that Victorian law operates justly, fairly and in accordance with community

expectations in relation to the way property is dealt with after a person dies

(b) ensure that the processes to resolve disputes about the distribution of such property

are efficient, effective and accessible

and practice following the recommendations of the National Committee for Uniform

Succession Laws established by the Standing Committee of Attorneys-General.

4 In conducting the review, the Commission has been mindful of changes in community

expectations arising from increasingly complex family structures, longer life spans and a more

accessible legal system. These changes have affected the operation of succession laws and

influenced the Commission’s recommendations.

Legal practitioner executors

7.9 There are cogent reasons why legal practitioners are appointed as executors, and it is in

the community’s interest that they continue to provide executorial services. Most legal

practitioners act in the best interests of will-makers and beneficiaries. Their duty to act

in their client’s interests is the cornerstone of the profession’s ethical standards and legal

obligations.