Legal services panel – Exemption policy

Purpose

1. The Legal Services Panel (the Panel) contract is a State Purchase Contract that requires all departments and participating statutory agencies to procure all legal services from the law firms appointed to the Panel. The policy seeks to balance the need for client agencies to have their legal needs addressed and the integrity of the panel arrangements.
2. The Exemption Policy outlines the process and criteria for engaging a law firm that is either:
   1. not appointed to the Panel; or
   2. not appointed to a particular Area of Law for which the services are required.

Process

3. Subject to the thresholds imposed in paragraph 10, all requests for an exemption must be made in writing to the relevant Agency Contract Manager, and must address the relevant criterion (criteria) as outlined in paragraph 7 below. The Agency Contract Manager is responsible for assessing the merits of the exemption application against the below criteria, prior to providing a recommendation to the responsible delegate on the merits of the request.
4. Subject to the conditions imposed in paragraphs 9 to 11, the Agency Secretary / Chief Executive Officer or their nominee is the decision maker for approving exemption applications for their department or agency. A nominee must be either hold the role of Deputy Secretary (or equivalent) or the Chief Procurement Officer, and have the appropriate financial delegation to approve the exemption application.
5. If an exemption application is approved, the Agency Contract Manager must keep a record of the engagement, and report this information as part of the Panel’s quarterly reporting requirements.

Criteria

6. The Agency Contract Manager must ensure that the exemption application meets either one or more of the following criteria to qualify for an approved exemption:
   1. the Panel firms are all faced with a conflict of interest and unable to provide the required services;
   2. the Panel firms are all unable to provide the required legal services;
   3. the Panel firms do not have the necessary expertise to provide the services;
   4. the area of law is such that it was not contemplated within the arrangements and no panel firm has been appointed to provide such services;
   5. engaging a law firm identified in paragraphs 16 to 17 (supporting the engagement of regional and disadvantaged suppliers); and
   6. the Agency Contract Manager is satisfied that the legal services required are more effectively and efficiently provided by a firm not on the Panel taking into account the circumstances of the legal issue and matter.
7. In making a case under paragraph 6(f), the requesting department / statutory agency must be satisfied that the Panel firms appointed to the relevant Area of Law do not have the expertise to adequately provide the required legal services. Noting that all Panel firms participated in a rigorous evaluation process and assessed as being technically capable to provide legal services within the Areas of Law for which they were appointed.
8. The unavailability of a key person is not sufficient to satisfy the criteria, but may be taken into account under paragraph 6(f). Agency Contract Managers must be satisfied that the necessary expertise is not available from the Panel firms appointed to that Area of Law.

Conditions

9. Applications for exemption must be made on a case-by-case basis. Where an ongoing exemption is required, the request must be made in writing to the Contract Manager to assess the eligibility of the application. Where the Contract Manager is satisfied with the merits of an ongoing exemption application, the request will be forwarded to the Executive Contract Manager for final determination.
10. Engagements under the exemption must not exceed $100,000 per annum for those departments and agencies with a total annual legal fees of less than $1 million per annum, and $300,000 per annum for those with total legal fees of more than $1 million per annum, based on the last financial year.
11. Where the legal fees will (or is likely to) exceed these thresholds, the application for exemption must be made in writing to the Executive Contract Manager through the Contract Manager.

Requirements

12. Engagement of legal services from a non-Panel firm under the exemption policy must reflect core procurement principles. Value for money determined on a whole of procurement basis remains the primary criterion in the selection of non-panel firms. Normal procurement planning, tendering and contract management apply. This includes the Victorian Government Purchasing Board policies, procurement rules and thresholds.
13. Engagements under the exemption policy must comply with procurement requirements within the relevant department or Agency.
14. The Panel contract (terms and conditions) and legal services order where applicable, is to be used for any engagement.
15. The non-Panel firm must comply with the pro bono obligations and minimum service standards under the Panel contract. The pro bono rate of 15% is the default amount of the obligation and will only apply where the total amount of legal fees to the non-Panel firm exceeds $100,000 per matter. This obligation must be met by the non-Panel firm by 30 June after that financial year, and reported to the Contract Manager for assessment.

Exceptions

16. Panel clients are permitted to engage regional law firms without seeking an exemption if the following criteria are met:
    1. the total value of the matter is less than $50,000;
    2. the services are delivered outside the metropolitan area; and
    3. the regional provider offers the same or better value for money as Panel firms.
17. Panel clients are also permitted to engage other Victorian based law firms that are identified as either Indigenous, or belonging to an under-represented group for matters worth less than $50,000 without seeking an exemption. These suppliers must meet one of the following definitions (as defined in the Government’s Social Procurement Framework) to be eligible for engagement:
    1. an indigenous law firm is defined as being at least 50 per cent Indigenous owned, and verified by Kinaway or Supply Nation as an Indigenous business.
    2. an under-represented legal supplier is defined in the Social Procurement Framework, and includes those groups that are identified as being either disadvantaged or supports women’s equality in the workforce (that is, all female owned law firm).