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Increased Frequency of Trust Audits

Under the authority of rule 5.10, the Law Society regularly performs investigations and audits on the financial management of each lawyer’s practice to determine compliance with the Rules and the Act. In certain circumstances, investigations and audits on a member’s accounts may be carried out more frequently. These circumstances are often related to other financial obligations of the lawyer. As such, members will be subject to an annual investigation or audit where the lawyer

  • is an undischarged bankrupt or has been discharged from bankruptcy for less than two years, or
  • has a judgment registered against him or her in the amount of $10,000 or more that has been outstanding for more than a year.

The increased frequency of investigations and audits under these circumstances are necessary to fulfill the Law Society’s duty to regulate the profession in the public interest. The duty of each lawyer and student under rule 5.13 as well as rules 9.29 to 9.31 to report the following to the Law Society also supports this mandate:

  • receipt of a petition, an assignment into bankruptcy or a proposal under the Bankruptcy and Insolvency Act,
  • a judgment becoming outstanding and remaining unsatisfied for a period of 30 days, whether or not an appeal has been taken,
  • a contempt order being made against the lawyer or student, and
  • an order for costs made personally against the lawyer or student under rule 55.14 of the Rules of the Supreme Court, 1986.

See rules 9.29 to 9.30 for further details.


Investigations and Audits: rule 5.10 (Law Society Rules)

Bankruptcy and Insolvency: rule 9.29 (Law Society Rules)

Judgment and Orders: rule 9.30 (Law Society Rules)

Duty to Report: rule 9.31 (Law Society Rules)

Bankruptcy and Insolvency: rule 5.13 (Law Society Rules)

Costs Arising from Misconduct or Neglect: rule 55.14 (Rules of the Supreme Court, 1986)

Related Topics:

Duty to Report: section 7.1-3 (Code of Professional Conduct)

Reporting Overdrafts: rule 5.06 (Law Society Rules)

Maintenance of Records: rule 5.02 (Law Society Rules)

Managing Money

Law Office Organization and Administration

Relationship with the Law Society

Reporting Obligations to the Law Society

Posted: June 12, 2020. Amended November 15, 2023