LLP legislation and rules in effect January 17
BC lawyers can opt for limited liability partnerships
The Partnership Amendment Act, 2004, SBC 2004, c. 38 permits the registration of limited liability partnerships (LLPs). Under consequential amendments to the Legal Profession Act, the Benchers have now passed rules to allow BC lawyers and law corporations to enter into LLPs under the new legislation.
For details, see the Partnership Amendment Act, 2004, the Legal Profession Act (sections 30, 83.1 and 84) and the Law Society Rules (9-12 through 9-20). The Legal Profession Act and Law Society Rules, as amended, are available on the Law Society website at www.lawsociety.bc.ca, and updated pages for the Member’s Manual are enclosed in this mailing.
Both the legislation and Law Society Rules on LLPs take effect on January 17, 2005.
For a law partnership or an extraprovincial LLP to register with the BC Registrar of Companies as an LLP under the Partnership Act, it must take the following steps:
1. submit to the Executive Director a copy of the registration statement that will be filed under the Partnership Act,
2. pay the LLP registration fee specified in Schedule 1 of the Law Society Rules ($250 plus $17.50 GST*), and
3. obtain a statement of approval of LLP registration from the Executive Director.
To issue a statement of approval of LLP registration, the Executive Director must first be satisfied that:
1. the intended name of the LLP complies with Rule 9-14 of the Law Society Rules, and
2. all partners in the partnership are members of the Society or a recognized legal profession in another jurisdiction.
A law firm can reserve a name through the Corporate Registry prior to applying for registration as an LLP. Please note, however, that the Law Society will not issue a statement of approval to register unless the Executive Director is satisfied that the name of the proposed LLP complies with Rule 9-14.
To receive a statement of approval from the Law Society as expeditiously as possible, you should ensure, when forwarding to the Society a copy of the registration you intend to file under the Partnership Act, that you also send a statement, certified to be correct by a partner of the firm, that all members of the partnership are members of the Law Society of BC or of a recognized legal profession in another jurisdiction.
Firms that register as LLPs should note their obligations under the Law Society Rules, including the requirement of Rule 9-17(2) to promptly take reasonable steps to notify in writing each existing client of the firm of the change and the effect of a limited liability partnership in respect of the liability of partners. Rule 9-17(3) sets out a form of statement to be included in this notice.
Likewise, Rule 9-17(4) requires that a law firm registered as an extraprovincial limited liability partnership must promptly take reasonable steps to notify in writing each existing client of the firm in British Columbia of the registration and any change, resulting from the registration, in the liability of the partners.