Before you instruct any lawyer, there must be a very clear agreement as to:
- What you want the lawyer to do for you;
- What the work will cost;
- Who the lawyer is acting for (in most cases the name of client will be obvious but occasionally, someone will be seeking advice on behalf of someone else eg a person with a disability or an association or other group of people).
What will it Cost
Most lawyers charge a fee based on the time taken to complete a task. A lawyer’s time is valued at a certain rate per hour. Hourly rates vary.
Some lawyers use other billing methods such as “no win no fee” or fixed fee pricing which means that the lawyer offers to complete the entire matter for a negotiated fixed fee.
The Legal Profession Conduct Rules provide that a lawyer must not charge costs which are more than reasonable for the practitioner’s services having regard to the following;
- The complexity of the matter;
- The time and skill involved in dealing with the matter;
- Any scale of costs eg for court related matters, that might be applicable to the matter;
- Any agreement as to costs between the practitioner and the client.
There are several options for charging including;
- “Scale Fees” A statutory Costs Determination regulates the fees payable for the particular task eg representation in a District Court personal injuries claim. Costs determinations (mostly referred to a “scale fees“) are made from time to time by a Costs Committee established pursuant to Division 9 of the Legal Profession Act. The determinations are published on line and may prescribe a range of fees payable for work undertaken in various area of the law; or
- Above Scale; A written costs agreement made pursuant to Division 6 of the Legal Profession Act, will provide for the payment of hourly rates in excess of the relevant scale prescribed by the statutory costs determination applying to the work; or
- If neither of these applies, according to the fair and reasonable value of the legal services provided, as assessed by the Supreme Court.
In relation to workers compensation matters, there is a Costs Determination but it only applies to;
- disputes which are determined using WorkCover’s conciliation and arbitration service;
- settlements concluded by means of a statutory Memorandum of Agreement to be registered at WorkCover.
Most workers compensation claims involve a range of other legal services including;
• General advice concerning the statutory workers compensation scheme, the persons entitlement to statutory benefits and the overall the management of the claim;
• Corresponding with the employer and its employers indemnity insurer concerning the claim, reviewing the medical evidence and obtaining whatever further medical evidence is required, correspondence with a rehabilitation provider, Medicare, the persons private health insurer, Centrelink and all other correspondence as required;
• Advice on potential claims for common law damages (negligence), whole person impairment impairment thresholds, time limits and statutory election procedures and if so instructed, the recovery of common law damages from the employer (or some other party) including representation in the District Court;
• Advice on any entitlement to income protection and/or total and permanent disability benefits, advice on policy wording and interpretation, assisting with completing the claim forms and correspondence with the insurer, trustee, medical attendant and rehabilitation consultant.
These services are not covered by WorkCover’s Costs Determination and are not usually recoverable from the employer as part of any settlement. It is therefore important that your costs liability is clearly understood before any work is commenced.
Otherwise, the basis on which we charge for the services we provide is usually determined by the relevant costs determination or scale applying to the work we are instructed to carry out. The relevant scale and other important on costs, can be accessed here. Lawyers fees can be negotiated depending on the nature of the work and other matters but persons in need of legal services should understand that for example, the scale rates for litigated matters range from as much as $495 per hour for District and Supreme court matters to $418 per hour for workers compensation/WorkCover matters. It is important that to avoid disappointment, clients should understand their potential costs liability before any work of substance is undertaken.
Section 260 of the Legal Profession Act, requires a lawyer to disclose the following important information to a client in writing, as soon as practicable after the lawyer is retained by the person.
(a) the basis on which legal costs will be calculated, including whether a costs determination applies to any of the legal costs;
(b) the client’s right to —
(i) negotiate a costs agreement with the law practice;
(ii) receive a bill from the law practice;
(iii) request an itemised bill after receipt of a lump sum bill;
(iv) be notified under section 267 of any substantial change to the matters disclosed under this section;
(c) an estimate of the total legal costs if reasonably practicable or, if that is not reasonably practicable —
(i) a range of estimates of the total legal costs; and
(ii) an explanation of the major variables that will affect the calculation of those costs;
(d) details of the intervals (if any) at which the client will be billed;
(e) the rate of interest (if any) that the law practice charges on overdue legal costs, whether that rate is a specific rate of interest or is a benchmark rate of interest (as referred to in subsection (2));
(f) if the matter is a litigious matter, an estimate of —
(i) the range of costs that may be recovered if the client is successful in the litigation; and
(ii) the range of costs the client may be ordered to pay if the client is unsuccessful;
(a) a statement that an order by a court for the payment of costs in favour of the client will not necessarily cover the whole of the client’s legal costs; and
(b) if applicable, a statement that disbursements may be payable by the client even if the client enters into a conditional costs agreement.
(g) the client’s right to progress reports in accordance with section 269; and
(h) details of the person whom the client may contact to discuss the legal costs; and
(i) the following avenues that are open to the client in the event of a dispute in relation to legal costs —
(i) costs assessment under Division 8;
(ii) the setting aside of a costs agreement under section 288;
(iii) making a complaint under Part 13;
(j) any time limits that apply to the taking of any action referred to in paragraph (h); and
(k) that the law of this jurisdiction applies to legal costs in relation to the matter; and
(l) information about the client’s right —
(i) to accept under a corresponding law a written offer to enter into an agreement with the law practice that the corresponding provisions of the corresponding law apply to the matter; and
(ii) to notify under a corresponding law (and within the time allowed by the corresponding law) the law practice in writing that the client requires the corresponding provisions of the corresponding law to apply to the matter.
In litigated matters, it is very often the case that settlement offers are negotiated. Section 264 of the Legal Profession Act requires the lawyer to disclose to the client, before any settlement takes place
(a) a reasonable estimate of the amount of legal costs payable by the client if the matter is settled (including any legal costs of another party that the client is to pay); and
(b) a reasonable estimate of any contributions towards those costs likely to be received from another party.
It is illegal for a lawyer to charge a “contingency fee” ie a fee “calculated by reference to the amount of any award or settlement or the value of any property that may be recovered in any proceedings to which the agreement relates”.
In relation to District Court matters which progress to a pre trail conference, Order 36 of the District Court Rules, requires a lawyer for a party to provide certain information to a client before the conference. That information is;
(a) the approximate legal costs and disbursements of the party up to and including giving the notice;
(b) the estimated future legal costs and disbursements of the party up to but not including the trial;
(c) the estimated length of the trial and the legal costs and disbursements associated with it;
(d) the estimated legal costs and disbursements that the party would have to pay to another party if the party were to lose the case.
Before we agree to act for you, we will provide you with a written Offer to Provide Legal Services which sets out the above information and importantly, identifies the precise nature of the work you want us to undertake.
All clients are encouraged to read the standard form Offer and discuss any issues with us at any time.