NSW Fines for Paid Referrals for Personal Injury Claims and Law Practices Must Refund Costs for Claim Farming

Claim Farming Practices Prohibition Bill 2025

6 May 2025: Passed by Parliament and signed off by the governor.

This bill kicks in: TBA

Legislative Assembly

Legislative Council

Assent

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Topics

claim farming claim solicitation consumer protection criminal penalties lawyer misconduct legal claims legal costs legal ethics legal professional conduct personal injury claims referral fees +6 more

Introduced by: Michael Daley MP (ALP); The Hon Daniel Mookhey MLC (ALP)

Links to official parliament websites

Official page: progress through parliament

Official page: bill text and explanatory notes

Effects of this bill

If this bill passes, it means that:

People cannot contact potential claimants to solicit or refer claims if they expect to be paid for doing so.
People cannot pay others to refer legal claims.
People can be fined up to 500 penalty units (2026: $55,000) for contacting someone to encourage them to make a personal injury claim if they are paid or expect to be paid for doing so.
People can be fined up to 500 penalty units (2026: $55,000) for referring someone to a service provider for a personal injury claim if they are paid or expect to be paid for the referral.
People can be fined up to 500 penalty units (2026: $55,000) for arranging for someone else to solicit personal injury claims or refer people to service providers for payment.
Anyone who pays, or agrees to pay, another person for a personal injury claim referral can be fined up to 500 penalty units (2026: $55,000).
Law practices convicted of these claim farming offences cannot charge legal costs for that claim and must immediately refund any costs already paid.
Lawyers who break these rules may be found guilty of professional misconduct, even if they are not convicted of a crime.
The Attorney-General must review how the law is working and report to Parliament about two years after the law starts.

The Debate

What different members said when this bill was debated:

Susan Carter LIB

“I speak on behalf of the Opposition about the Claim Farming Practices Prohibition Bill 2025. The bill will prohibit the practice commonly known as claim farming. This is an unethical practice engaged in by a very small number of legal practices and other persons to aggressively solicit persons to make compensation claims in tort.”

Official source →

Sue Higginson GRN

“On behalf of The Greens I indicate that we will not oppose the Claim Farming Practices Prohibition Bill 2025. It is important to acknowledge the significance of personal injury claims as a legal option for the victims and survivors of harm, including child abuse.”

Official source →

Rod Roberts IND

“I make a contribution to debate on the Claim Farming Practices Prohibition Bill 2025. I support the bill for the reasons already canvassed by many members. However, I do so with reservations.”

Official source →

Cameron Murphy ALP

“I contribute to debate on the Claim Farming Practices Prohibition Bill 2025. I listened intently to the contribution from Ms Sue Higginson. She raised concerns about the issues that potentially occur when we introduce legislation that might adversely impact victim-survivors. Many people hold that concern. Importantly, the bill is very narrow in its scope.”

Official source →

Jeremy Buckingham LCP

“On behalf of the Legalise Cannabis Party I support the Claim Farming Practices Prohibition Bill 2025.”

Official source →

Daniel Mookhey ALP

“The Claim Farming Practices Prohibition Bill 2025 will create a new Act to prohibit claim farming in relation to claims for personal injury damages, including those arising from intentional torts such as child abuse. In introducing this bill, the Government is acting to protect people who have suffered personal injury, including victim‑survivors of abuse, from being exploited by claim farmers.”

Official source →

News articles and press releases

Claim Farming Practices Prohibition Bill 2025

Mr MICHAEL DALEY, Attorney General — 2025-03-18

The bill will create a new Act to prohibit the practice of claim farming in relation to certain personal injury claims under the Civil Liability Act 2002, as well as personal injury claims arising from intentional torts. Specifically, the bill will prohibit a person from both contacting another person to encourage them to make a relevant claim with the expectation of receiving a fee or other benefit and from buying or selling a relevant claim referral. The bill will also amend the Legal Profession Uniform Law Application Act 2014 to impose additional consequences on legal practitioners who engage in the prohibited conduct.