Here is our view on a recent WA case that mentioned Cleardocs - the outcome is "business as usual".
In forming our view, we've worked closely with our lawyers, Maddocks.
You can also read the view of the Institute of Chartered Accountants in Australia in the "Court case raises issues about preparation of legal documents" article.
Below we outline the case - which has some curious facts.
The SMSF deed in the case is not a Cleardocs deed. In fact:
The first Cleardocs heard about the case was in legal updates provided by law publishers etc.
Cleardocs has never been contacted by any of the accounting firm, its principals, the lawyers in the case or the Legal Practice Board of Western Australia.
The accountant was not a Cleardocs customer - and did not use the Cleardocs system
The firm in the case was not a Cleardocs customer. It did not use the Cleardocs system. It did not use a Cleardocs deed.
If the deed in the case had been based on a Cleardocs deed, then we believe the way the accounting firm apparently created the deed would have been in breach of the Cleardocs terms and conditions.
At Cleardocs, customers order documents online and buy a one-off license to use the documents delivered. Yet the deed involved in the case appears to have been created in the accountant's offices by copying an old deed the firm had on file.
The Cleardocs terms and conditions make very clear that Cleardocs documents are not available as pro-forma documents. Instead, the Cleardocs system and the assurances we give in our terms and conditions are valid only if the user arranges the relevant document package through Cleardocs on a pay-per-use basis. If the accounting firm had really done what the judgment describes (that is, copying a Cleardocs deed which it had on file), then we believe the firm would have been in breach both of the Cleardocs terms and conditions and of the Copyright Act.
Cleardocs', together with its lawyers Maddocks, has gone to considerable lengths in order to gain a full understanding of the background and relevant facts in the WA Case - including by inspecting the court file and examining all relevant transcripts of proceedings. Having been through that process, Cleardocs' position is that:
The fact is, accountants and others have been using shelf-company and trust providers in Australia for 20 years or so.
Cleardocs is not able to give legal advice. You or your firm (or both) must reach their own conclusions, in consultation with their own advisers, about using Cleardocs.
Cleardocs will continue to monitor relevant developments.
If you have any questions, please call us on 1300 307 343.
Paul is a Senior Associate in the Maddocks Commercial team with particular expertise in commercial agreements for the supply of goods and/or services, the Personal Property Securities Act 2009, the National Consumer Credit Protection Act 2009 and the National Credit Code and the Australian Consumer Law.
Paul's key areas of practice include:
Before joining Maddocks, Paul was employed for 13 years with the Victorian Department of Justice, principally as a Deputy Registrar in the Victorian Magistrate's Court, but also as a legislation, policy and project officer for the Department.
The legal information and commentary on this site is general only. Documents ordered through Cleardocs affect the user's legal rights and liabilities. To assess their suitability for the user, legal accounting and financial advice must be obtained.
For more information, contact Maddocks on (03) 9258 3555 and ask to speak to a member of their team.