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Winners turned to losers by itemised billing

Winners turned to losers by itemised billing

By Karin Derkley


Itemised billing is a time-consuming and costly process that has the potential to undermine maximum costs recovery, says costs law accredited specialist Cate Dealehr. Ms Dealehr, the founder Australian Legal Costing Group (ALCG), will present on the future of itemised billing at the LIV's National Costs Law Conference on Wednesday March 21. In the case of party-party litigation, itemised billing is a way of verifying the costs of the winning party where negotiation has failed. It involves a line by line itemisation of every cost involved in the litigation, with reference to the relevant scale. The paying party then examines the bill and determines whether they believe the costs claimed are reasonable. That can be a laborious process. It can also become a way the loser (paying party) can wear down the winner (receiving party), Ms Dealehr suggests. "The power has gone from the winner to the loser. The paying party can make a really low offer for costs and you're stymied. They love you to do a detailed bill because they know how much it will cost you and that you might not recover it on taxation." Only in Victoria does the 15% rule apply, which works unfairly in most occasions against a winning party, Ms Dealehr says. "You go through this very painstaking process of drawing a bill on behalf of the party who won the case including costs. It's causing a concern that we are becoming an expensive part of the file which the Cost Court won’t allow even if the paying party is being unreasonable." Ms Dealehr says she has seen bills where the costs of drawing the bill itself amounted to 30 per cent of the professional costs in small to medium matters. "We have had clients who come to us because they’ve received a low offer and we tell them they may be better off accepting it”. Different jurisdictions in Australia approach itemised billing and taxing differently, and the session panel will provide the opportunity to learn from the experience of those operating in other states. Therese Tonkin, the general manager/costs lawyer at Blackstone Legal Costing will talk about the situation in Queensland, and Alyson Ashe, principal at Alyson Ashe & Associates will talk about New South Wales. Ms Dealehr has also spent time recently in the United Kingdom and will share her experience of that jurisdiction’s attempt to rationalise costing processes. "It will be very helpful to learn from other jurisdictions and the brains trust in the room about the kinds of problems they are experiencing and what kinds of strategies they’re using to maximise recovery for their lawyers," Ms Dealehr says “It’s really important that we can find a better system for Victoria. The system we have now is very inefficient and the only thing we can change at the moment are our practices and we are hoping to spark innovation in this area at the conference”. Also at the conference, Supreme Court Justice Kate McMillan will give a keynote address considering the management of legal costs from a judge’s perspective, and there will also be sessions on expert report writing techniques, preparing compelling submissions, and the ways in which technology and innovation is changing the way legal work is undertaken in Australia. For more information about the conference and to book, go to the LIV conference website here.

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