The West German Lawyers Association today called for rejection of proposed legislation that would allow court-appointed monitors to listen to private conversations between lawyers and their imprisoned clients who are convicted or suspected terrorists.

The proposal - which is supported by the conservative opposition parties and opposed by the ruling coalition government - reflects one more step in West Germany's uncertain efforts to combat legally the small but clever band of terrorists that has carried out a wave of still unresolved political murders here in the last several months.

In reaction to that terrorism, the Bonn government already has passed two new laws that also generated controversy abroad, but not much opposition here.

Earlier this year, Bonn approved the monitoring of all written communications with jailed terrorists. Last month, during the prolonged kidnaping of industrialist Hanns-Martin Schleyer, the Parliament also approved a law that allows the temporary isolation of jailed terrorists from all contact with each other and the outside world - including their lawyers - for renewable periods of 30 days in emergencies.

Bonn's legal actions are an outgrowth of the official view that a score of radical lawyers are in league with their jailed clients. One of these lawyers, Siegfried Haag, is already in jail facing complicity in murder charges, and another, Klaus Croissant, is under arrest in France.

The proposed new law was passed last week by the upper house, which is controlled by the conservative opposition Christian Democrats and the Christian Social Union. It will be taken up later this year in the crucial lower house, where the left-center coalition led by Chancellor Helmut Schmidt holds a slim majority.

When the bill to allow monitoring of written communications was passed earlier this year, the government succeeded in rejecting an attempt to include-monitoring of oral communications.

In the aftermath of the Schleyer killing, however, the newly submitted bill may stand a better chance. It would only take three or four defections from the government's coalition ranks to pass the bill. But that would also present a grave political crisis for Schmidt, and most observers believe he will be able to keep his supporters in line.

The statement by the 19,000-member lawyers association condemned the new proposal because it allows the courts to appoint people to listen in on conversations merely upon suspicion of conspiracy. The bill does not establish any specific guidelines under which judges may give such an order, and does not require evidence that would support the claim of suspicion.

"We utterly dislike this bilL," said the lawyers' executive secretary, Heinz Brangsch. Association spokesmen said they believed the overwhelming majority of their members oppose the proposal.

Beyond this proposal, there is a still more controversial one in the legislative pipeline.

The opposition has also introduced a bill - discussed in a lower-hous committee for the first time yesterday - that would allow keeping convicted terrorists in jail beyond expiration of their original sentence if there is evidence the prisoner will commit similar crimes.

Brangsch describes this proposal as "more than extraordinary," and also likely to draw opposition from the association if it gets further in the legislature.

Many of the roughly 100 terrorists now in jail are there under sentences of five years or less and hence are to be out reasonably soon.