6Claim referrals for consideration prohibited

6 Claim referrals for consideration prohibited

6 Claim referrals for consideration prohibited

(1) A person must not—

(a) receive consideration for referring a claim to another person, or

(b) agree to receive consideration for referring a claim to another person, or

(c) arrange for a third party to receive consideration for the person referring a claim to another person.

Maximum penalty—500 penalty units.

(2) A person (the payer) must not—

(a) provide consideration to another person for the referral of a claim, or

(b) agree to provide consideration to another person for the referral of a claim, or

(c) arrange for a third party to provide consideration to another person for the referral of a claim.

Maximum penalty—500 penalty units.

(3) Subsection (2) applies whether a claim is referred for the purpose of—

(a) the payer providing a service in relation to the claim, or

(b) someone else providing a service for the claimant.

(4) This section does not apply—

(a) if, in acting for a claimant, a law practice refers a matter relating to a claim to another person to provide a service in relation to the claim, or

(b) if all or part of a law practice is being sold to a purchasing law practice and—

(i) the referral, including details of the consideration, is disclosed to the claimant, and

(ii) the consideration provided by the purchasing law practice is not more than the unbilled legal costs of the claimant at the time of the sale of all or part of the practice, and

(iii) the claimant is advised the referral may be refused, and

(iv) the claimant approves the referral.

(5) Subsection (4) places an evidential burden on the accused.

(6) In this section—

claimant includes a potential claimant.