Client’s Rights and Lawyers Obligations Under New Costs Legislation

One of the most pressing concerns most clients have when they consult a lawyer for family law advice is – how much is this going to cost me?

Quite reasonably the amount of costs a client is likely to incur in resolving a dispute with his or her spouse or partner is something the client is often anxious about and is entitled to understand at the outset.

Providing a “quote” for costs however can be problematic for lawyers too, because at the initial meeting with a client it is not always possible to foresee how the matter will proceed and the costs that are likely to be incurred. There are a myriad of factors which are unforeseeable at that stage such as how the other party and his or her lawyer will conduct the proceedings, what disbursements are likely to be incurred such as fees for valuation reports of real estate and/or businesses in financial matters and family reports in parenting matters to name a few. Importantly it is impossible to foresee whether the matter will be resolved quickly or whether protracted court proceedings will ensue with all the associated implications such as interim hearings, mediation and a final judicial determination.

New legislation governing legal costs in Victoria was introduced in Schedule 1 of the Legal Profession Uniform Law Application Act 2014 which commenced operation on 1 July this year.

This new legislation addresses the rights of clients and the obligations on their lawyers with respect to legal costs. Legal costs must be fair and reasonable (and there are more stringent requirements than before to determine what is fair and reasonable), and every client must be provided with information disclosing the basis on which legal costs will be calculated as soon as possible after instructions are initially received including an estimate not only of costs at different stages of the proceedings but also of the total legal costs likely to be incurred if a judicial determination on all outstanding issues is required.

Ranges are no longer permitted.

Importantly, a lawyer must not exceed the cost estimate provided for different stages of work. In the event that this is likely to occur, the lawyer must provide the client with information disclosing the change in costs and explaining why there will be an increase over and above the initial estimate. This information must be provided before the costs exceed the initial estimate.

The legislation also requires that the client understands the costs information that is provided and gives consent to the proposed course of action for the conduct of their matter and the proposed costs to be incurred.

Essentially the new legislation increases protection for the client including stringent requirements with respect to fair and reasonable legal costs and full disclosure as to the costs likely to be incurred with regular review and updating of costs estimates throughout the course of the matter.

At Carew Counsel our costs information details the work to be done at each different stage of the proceedings, the level of skill, experience and seniority of the lawyers undertaking the work and the hourly rates a client will be charged for services.

We are at all times mindful that transparency with respect to costs is very important for our clients.

Carew Counsel is also moving towards quoting “a fixed fee” not only for simple matters but also for different stages of work in complex matters.

If you require further information as to how Carew Counsel operates with respect to costs please do not hesitate to contact us.

Susan Scott Mackenzie

Susan Scott Mackenzie

Senior Associate, Accredited Family Law Specialist

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