Statutory deposit accounts
What is a statutory deposit account?
Law practices and approved clerks that are required to maintain a trust account in Victoria must deposit a specified amount of money with the Board, out of any trust money that has been received by the practice or clerk. The money is held by the Board and is repayable on demand.
The Board is required to maintain a statutory deposit account (SDA) into which it must deposit the monies. The account is maintained within the Public Purpose Fund held by the Board under Part 6.7 of the Legal Profession Act 2004 (Vic) (“the Act”).
Opening a statutory deposit account
When the Board receives a notification of a new trust account, the Board will request Westpac Bank to open an SDA to be linked to the trust account of the law practice or an approved clerk.
Requirement to deposit with the Board
A law practice or an approved clerk that is required to maintain a trust account must deposit money into the SDA, out of the trust money received by the practice or clerk.
The amount required to be deposited is calculated by the Board, in respect of each quarter, in accordance with a formula detailed in s 3.3.63 of the Act.
Failure by a law practice to deposit the required deposit amount may constitute unsatisfactory professional conduct or professional misconduct on the part of any principal of the law practice.
How to deposit into a statutory deposit account
To make a statutory deposit:
- Write out a cheque from your trust account payable to the ‘Legal Services Board – “name of law practice” statutory deposit account’.
- Attach the cheque to one of the pre-encoded deposit forms previously forwarded to you by the Board.
- Hand your cheque and deposit form to Westpac (there may be a fee if a deposit is made at any other bank).
- The bank will give you a receipt of your deposit.
- Your deposit will be credited to the SDA.
- The Board will send you a facsimile statement the following business day confirming the deposit and the total amount that you hold in the SDA.
- Please contact the Board if you have not received a facsimile statement by noon the following business day after your deposit.
Repayment by the Board
Amounts deposited with the Board into the SDA of a law practice or an approved clerk are repayable on demand to the practice’s or clerk’s trust account.
However, if an amount is repaid from the SDA to a law practice or an approved clerk and subsequently there is a sufficient amount in the practice’s or clerk’s trust account to cover the required deposit amount, the law practice or approved clerk must deposit the required deposit amount with the Board.
How to withdraw from a statutory deposit account
To withdraw monies from the SDA, please contact the Westpac Bank on (03) 9608 3883 to arrange telegraphic transfer into your Trust Account by 2:30pm on any business day. Requested monies will generally be available the next business day.
If you experience any problems in transferring the monies, please contact the Board on (03) 9679 8000.
Confirmation of transactions
After any statutory deposit or withdrawal is made, the Board will send a facsimile statement to the trust account holder the following business day confirming the total amount held in the SDA. A statement will also be forwarded at the end of any month in which a statutory deposit or withdrawal was made.
All trust account holders will receive SDA statements twice a year (May and November), regardless of whether a statutory deposit or withdrawal has been made.
Failure to adjust statutory deposit account
The Board is required to monitor trust account balances and will advise a law practice or an approved clerk when an adjustment to the required deposit amount into the SDA is required.
If there is a particular reason why an additional deposit cannot be made (e.g. insufficient funds, unpresented cheques), a law practice or clerk must nonetheless obtain an exemption from the Board.
Where there is a continual failure to deposit the required deposit amount into the SDA or to obtain an exemption from the Board, the Board may refer the matter to the Legal Services Commissioner who may investigate whether there has been unsatisfactory professional conduct or professional misconduct on the part of a legal practitioner.
Exemptions from statutory deposit provisions
If you are unable to deposit the required deposit amount into the SDA, you may apply for exemption by completing the exemption form below and faxing it to the Practitioner Information Team at the Board.
View the Board’s policy on statutory deposit account exemptions below.
Statutory deposit account forms
- Download the SDA quarterly deposit exemption application form (46KB PDF)
- Download the SDA Enduring exemption application for further deposit of $15,000 or less (153KB PDF)
- Download the SDA exemption policy (41KB PDF)