Liability limited by a scheme approved under professional standards legislation: where the line goes

If your practice participates in a professional standards scheme, one short sentence has to appear on much of what you send: Liability limited by a scheme approved under Professional Standards Legislation. It is easy to get slightly wrong, and the consequences of getting it wrong can include losing the protection the scheme exists to provide.

This guide explains what the disclosure is, where it goes, how to set it on stationery, and what else a law practice should and should not expect to see on its letterhead. It is general information, not legal advice. Your scheme association, law society or professional body is the authority on what your particular scheme requires.

What does a professional standards scheme do?

A professional standards scheme limits the civil liability of participating members of an approved occupational association, such as a law society or an accounting body. Each state and territory has professional standards legislation, for example the Professional Standards Act 1994 (NSW). Under it, an occupational association such as a law society or an accounting body can have a scheme approved that caps the civil liability of participating members, in exchange for insurance, risk management and complaints standards. The national body that administers the schemes is the Professional Standards Councils.

Law societies in most states run schemes for solicitors, and the accounting bodies (CA ANZ, CPA Australia and the IPA) run schemes for their members in public practice. Participation, the cap amounts and the scheme dates all come from your association. Accountants should also read our accounting firm letterhead guide.

What does the professional standards scheme disclosure require?

Professional standards legislation requires a participating member to disclose that their liability is limited. In NSW, section 33 of the Act requires a person whose liability is limited by a scheme to disclose that fact to clients and prospective clients in documents that promote or advertise the person or their occupation, including correspondence.

The Councils' guidance sets three practical rules:

1. The wording is fixed. The statement is "Liability limited by a scheme approved under Professional Standards Legislation." CA ANZ's guidance to its members is not to alter or add words to it.
2. There is a minimum size. The statement must be no smaller than the equivalent of Times New Roman 8 point.
3. It must be prominent enough to be read. Do not reverse it out of a busy image or set it in a pale tint that disappears on an office printer.

Failing to disclose can attract a penalty, and in some circumstances may affect whether the member has the benefit of the scheme for that work.

Where must the professional standards scheme line appear?

The Professional Standards Councils' disclosure factsheet applies the scheme line to material from letterhead and email to brochures, websites and print advertisements. In summary:

• letterhead and letters signed by or for the member
• fax cover sheets and email correspondence
• newsletters, brochures and promotional material
• websites
• print advertisements and directory listings.

Social media profiles and posts are treated differently in the Councils' guidance.

Business cards are the point of difference. The factsheet lists business cards. NSW legislation, by contrast, is reported to exclude business cards from the documents covered by section 33, and CA ANZ tells its members the disclaimer applies to business stationery but not to business cards. Ask your association which rule it wants you to follow. If you have room and want to remove doubt, including the line on the back of the card does no harm.

Logos. Some associations provide a scheme logo or badge. A logo does not replace the wording; if you use one, follow the association's artwork rules for size and clear space.

How should the scheme line be set on letterhead and stationery?

On stationery, the scheme line usually sits in the letterhead footer on the first page, at no smaller than 8 point, and also belongs on compliment slips, folders, brochures and email signatures. Some practical points from the print side:

• Letterhead. The footer is the usual home, on the first page. Continuation sheets usually omit it, because the letter as a whole already carries it, but check with your association if the continuation pages could be separated and sent alone.
• Compliment slips. A slip that accompanies documents is correspondence. Include the line.
• Presentation folders and brochures. These promote the practice. Include the line, usually on the back panel.
• Email signatures and templates. Put it in the signature block as live text, not as part of an image, so it remains legible when images are blocked.
• Size in practice. Eight point is the floor, not a target. A typeface with a small x-height looks smaller than Times at the same size, so set the line at around 8.5 or 9 point.
• Scheme changes. Schemes have fixed terms. When a scheme expires, or your firm stops participating, the line must come off. Council notices about expired schemes tell members to stop using the statement on letterhead and business documents. Remove it from digital templates the same day; do not keep printing old stock.

What else must a law practice letterhead include?

Lawyers often ask what the Legal Profession Uniform Law requires on letterhead. The short answer is that it does not set a general list of letterhead contents. The obligations that do shape a law firm's letterhead come from several places:

• Business structure. An incorporated legal practice is a company, so the Corporations Act rule applies: full company name and ACN, or an ABN that contains the ACN, on public documents such as letterhead. Our guide to what must be on a company letterhead covers this. The Victorian Legal Services Board notes that an incorporated legal practice must have at least one authorised principal and must notify the regulator before it starts to practise.
• Not misleading. The conduct rules for solicitors require that advertising and representations about the practice are not false, misleading or deceptive. In practice this governs names and titles: who is listed as a partner or principal, how staff without a practising certificate are described, and whether "specialist" appears without accreditation. The Queensland Law Society has published guidance on whose details can appear on letterhead, emails and business cards.
• Practising certificate numbers. These are not generally required on letterhead. Some practitioners include them, particularly on court documents, where court rules may set their own requirements.
• Scheme line. If the practice participates, as above.

Requirements vary between states, and Queensland, South Australia, Tasmania, the ACT and the Northern Territory are outside the Uniform Law. Check with your law society.

How does Proof & Print check the scheme line on a proof?

Point 9 of our written proof checklist is a check that sector details, such as an ABN or ACN or a professional standards scheme line, are present where you would expect them. If the line is missing, set below 8 point or worded differently from the prescribed text, your consultant will flag it before anything prints. We never rewrite it without asking, and it is not legal advice. Our letterheads start from $385 inc GST for 500 sheets of laser-safe 100gsm stock; see how they fit into a full law firm stationery suite, or read more about our work with legal and professional practices.