“It's a very poorly designed deed because if the client has got a reversionary nomination in place and three or four years down the track [they then want] a BDBN, and you don’t have your eye on the ball, that reversionary nomination will take precedence over that BDBN,” Mr Butler explained.

Mr Butler said the deed should instead expressly state that the BDBN will override a reversionary nomination to the extent of any inconsistency.

Deeds that have the reversionary nomination as the priority, he said, are “poor practice” and “dangerous for both SMSF professionals and their clients”.

“For you as an adviser, it’s a very dangerous practice, because if you [set up] a pension, that [then becomes] legal work because you are upsetting the BDBN and that’s affecting a legal right,” he explained.

“That could be in breach of the legal practice legislation, that could be loss of professional indemnity insurance and there could be consequences for your client because you haven't brought that to account when you were doing the BDBN or when you're doing the reversionary nomination. You haven't realised that you're now affecting the BDBN. It's dangerous territory,” he explained.

Mr Butler said there are currently a number of lawyers working to crack down on some of the poorly constructed legal documents being offered by certain suppliers, including those for SMSFs.

“They are focusing on supply operations that don’t operate through law firms, supply their documents through the web, don’t check anything but make out that its signed off by a lawyer [when its not],” he said.

John Morgan, a barrister from the Victorian Bar has also previously warned SMSF accountants and advisers on some of the risks with supplying legal documents, particularly in certain jurisdictions.

“I would caution tax agents from using non-lawyer services to supply supposedly ‘standard form’ documents. The origin and quality of these standard documents is uncertain and neither the tax agent, nor the client, is in a position to assess the quality of the document, much less whether it suits the client’s circumstances,” he told SMSF Adviser.

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