Lawyers Nominee Companies

Lawyers Nominee Company Rules came into force on 1 August 2008, when the Lawyers and Conveyancers Act took effect. 

The new Rules differ in some respects from previous rules and all lawyers who operate Lawyers Nominee Companies need to familiarise themselves with them. Some important changes are:

  • A new form of constitution is prescribed. This is contained in Schedule 1 of the Rules. This new constitution must be adopted by all nominee companies.
  • The name of each nominee company must contain the words ‘Lawyers Nominee Company Limited’ or ‘Solicitors Nominee Company Limited’ (Rule 5.2). If the name of a nominee company does not comply with this requirement, immediate steps must be taken to change its name. The New Zealand Law Society must first approve the new name (Rule 5.1).
  • There is a new form of Specific Authority for Investment in Schedule 3.
  • The information to be given to investors has been changed and amplified – Schedule 4. The changes result from the position taken by the Securities Commission and Ministry of Justice officials. In particular, it is necessary to provide information about the basis on which the lawyer’s fee will be charged (clause 13(a)). All new advances must comply with these requirements.

The Law Society’s inspectors will routinely check that law firms who operate lawyers nominee companies have complied with these new requirements. 

Companion guidelines, approved by the Board on 12 December 2008, are available to help firms comply with the rules. These guidelines are also available in pdf format.

For further information contact: iain.watson@lawsociety.org.nz

© New Zealand Law Society 2008