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Uniform costs

Uniform costs

By Steven Sapountsis

Practice & Procedure 

On the first anniversary of the introduction of the Legal Profession Uniform Law (Uniform Law), and prompted by questions recently posed by practitioners, it might be timely to highlight the difference between cost disclosure and costs agreements. Where it is likely that costs in a matter will exceed $750, and unless the client is a government or commercial client, a solicitor must make disclosure of certain matters to the client “when or as soon as practicable after instructions are initially given”. The LIV website has considerable information and precedents on what matters must be disclosed. Relevant for present purposes, the disclosure must include information about a client’s rights to negotiate a costs agreement with the solicitor. The disclosure statement, which must be in writing, is not a costs agreement. The solicitor’s entitlement to charge and recover costs, and the client’s obligation to pay costs, will be determined by the costs agreement between them. The Uniform Law requires: a costs agreement to be in writing or evidenced in writing the charging of costs that are fair and reasonable, and proportionate and reasonable in amount. A costs agreement may be void for a number of reasons, including the failure to make a disclosure in accordance with the Uniform Law. Under the Legal Profession Act 2004, if a costs agreement was set aside, the solicitor could recover costs in accordance with the applicable practitioner remuneration order or scale of costs, or if no scale was applicable, then in accordance with “the fair and reasonable value of the legal services provided”. The Uniform Law does not have the same default provision for recovery of costs under a void costs agreement, although s199 allows the Costs Court to “determine the legal costs (if any) that are to be payable”. It is anticipated that the Costs Court will have reference to any applicable scale on any such assessment.

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