New cost provisions and you!

New legislation, known as the “Legal Profession Uniform Law 2014” (LPUL) will help ensure all clients make informed choices about the legal services they access and the costs involved.

In our experience, clients want to know three things:

  1. How much will it cost?
  2. What are they going to get for their money?
  3. The possible outcomes: This can only be based on our instructions and the documents produced to us in support of their case.

Assessing proper expectations enables a realistic assessment of possible costs.  As at June 2016, you should expect to spend:

  • A minimum of $3,000 preparing for any day in court;
  • Up to $7,000 for each day spent in court or a tribunal. This figure may include some or all of the $3,000 spent in preparation.

The new Legal Profession Uniform Law 2014 is discussed in the article “The Empowered Client” featured in the August 2015 edition of the “Law Institute Journal of Victoria” (LIJV) by Naomi Murray and Les Harris.

 

“Fair, reasonable and proportionate costs”

The article explains that a practitioner can only charge costs that are “no more than fair and reasonable in all the circumstances.”

Legal costs must be:

  • Proportionate and reasonably incurred; and
  • Proportionately and reasonable in amount.

 

Providing cost estimates

The response that clients may get to asking how much legal costs would be is, “How long is a piece of string?” The LPUL now requires lawyers to provide an estimate of total legal costs. However, in many instances this approach is unrealistic, and arguably unhelpful for a client.

At the outset of litigation, it can be very difficult to assess the likely costs, as they will depend on factors such as the strength of the client’s case, the negotiating position adopted by the other side, and even the strategic approach adopted by an opposing lawyer or a self-represented litigant.

Given that an estimate is to be provided to a client at or arguably prior to the time of a formal retainer, and this is often before the practitioner has obtained full instructions and documentation and may need to research and discuss possible options with the client, the ability to give a single estimate is very difficult, and requires assumptions to be made regarding the likely conduct of the matter without much information at all.

One option may be to provide a range of estimates as part of the discussion with the client about the proposed course of action (which is likely to include an exploration of the alternatives), the likely costs of each alternative, with the estimate of total costs being detailed as the estimate of costs for the agreed course of conduct.

We are finalising further information on this issue and it will be uploaded to our website for future reference.

 

Some material reference from: The Empowered Client, Naomi Murray & Liz Harris. Law Institute Journal, August 2015.

 

This article provides information that is general in nature and is not a substitute for legal advice.