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					                SUBMISSIONS

                   TO THE

   IMPLEMENTATION ADVISORY GROUP


on the “Report of the Legal Costs Working Group”




             THE BAR COUNCIL



                  10th May, 2006




                                                   1
CHAPTER ONE                 INTRODUCTION ..................................................................... 4

CHAPTER TWO                 GUIDELINES ............................................................................ 6

   A.      Proposed “guidelines” .................................................................................... 6
        (i) Scope of recommendation.......................................................................... 6
        (ii)   Effect of proposed guidelines ................................................................ 8
        (iii) Formulation of proposed “guidelines” ................................................. 22
        (iv)   Implementation of proposed “guidelines” ........................................... 27

   B       Submissions on proposed “guidelines” ........................................................ 27
        (i) Assessment of work done ........................................................................ 27
        (ii)   Criterion of time spent ......................................................................... 30
        (iii) Value of claim ...................................................................................... 39
        (iv)   Other factors......................................................................................... 40
        (v)    Updating guidelines ............................................................................. 48

CHAPTER THREE                    LITIGATION REFORM................................................... 50

   A.      Delay ............................................................................................................ 50
   B.      Pre-trial costs ............................................................................................... 52
   C.      Estimates of costs ......................................................................................... 52
   D.      Jurisdictional limits ...................................................................................... 53
   E.      Mediation ..................................................................................................... 53
   F.      Civil legal aid ............................................................................................... 53
   G.      Court fees ..................................................................................................... 55
   H.       Court reform................................................................................................ 55

CHAPTER FOUR                  INFORMATION .................................................................... 57

CHAPTER FIVE                 COUNSEL FEES .................................................................... 60

   A.      Proportion of costs between junior and senior counsel ............................... 60
   B.      Number of counsel ....................................................................................... 62
   C.      Brief fees ...................................................................................................... 63
   D.      Work actually done ...................................................................................... 65

CHAPTER SIX                   ASSESSMENT OF COSTS .................................................. 67

CHAPTER SEVEN                  LEGAL COSTS REGULATORY BODY ......................... 70

CHAPTER EIGHT                   PROPOSALS FOR REFORM ........................................... 73

   A.      Disclosure of information on costs .............................................................. 74
        (a)     Disclosure to solicitor .......................................................................... 81
        (b)     Content of letter of disclosure .............................................................. 81
        (c)     Timing of letter of disclosure ............................................................... 82



                                                                                                                              2
         (d)         Updates ................................................................................................ 83
         (e)         Exceptions ............................................................................................ 83
         (f)         Effect of letter of disclosure ................................................................. 83
         (g)         Professional Practices Committee........................................................ 84

    B.        Costs Agreements ........................................................................................ 85

         C.      “Brief fee” ................................................................................................ 86

    D.        Fee notes ...................................................................................................... 87

    E.        Guidelines .................................................................................................... 88


CHAPTER NINE                   SUMMARY OF SUBMISSIONS ........................................... 92



 APPENDIX A ....................................................................................................... 100
 DISCLOSURE OF LEGAL COSTS AND COSTS AGREEMENT ........................ 100
 BETWEEN A BARRISTER AND A SOLICITOR ................................................. 100




                                                                                                                               3
CHAPTER ONE                   INTRODUCTION




1.01   The Bar Council makes these Submissions to the Implementation Advisory
       Group to present its views on the Report of the Legal Costs Working Group.
       These Submissions also illustrate certain recommendations of the Legal Costs
       Working Group (“the Working Group”) in respect of which the Bar Council
       considers clarification or additional information to be necessary before such
       views can be expressed.


1.02   These Submissions are divided into nine chapters, which address the
       recommendations contained in the Working Group’s Report under various
       headings. The second chapter analyses the recommendation for the
       introduction of guidelines to govern recoverable costs. The third chapter deals
       with litigation reform and considers some of the proposals in the Working
       Group’s Report for rendering the court system more expeditious, and other
       related recommendations. The fourth chapter concerns the provision of
       information regarding legal costs and analyses the potential role of a barrister
       in that context. The fifth chapter addresses specifically the issue of counsel
       costs, including such matters as brief fees. Chapters six and seven concern the
       recommendations for the establishment of a Legal Costs Assessment Office
       and a Legal Costs Regulatory Body, respectively. Chapter eight sets out the
       Bar Council’s suggestions for means of reforming the rules and procedures
       governing legal costs. Finally, Chapter Nine sets out the submissions which
       have been made in the course of the preceding eight chapters.


1.03   In each of these chapters, the Bar Council focuses upon those
       recommendations in relation to which it has a particular interest or insight.
       However, these Submissions also address any recommendations with which
       the Bar Council considers it may be of assistance. However, these
       Submissions do not purport to address every recommendation of the Working



                                                                                          4
       Group. In the event that more detailed information becomes available
       regarding the recommendations contained in the Working Group’s Report, the
       Bar Council would welcome the opportunity to provide further submissions.


1.04   In making the Submissions set out in the ensuing eight chapters, the Bar
       Council is highly conscious of the fact that the implementation of any system
       for the formulation, implementation and assessment of rules governing legal
       costs will necessitate very considerable changes to the system which is
       presently in place. The inadequacies of the litigation regime in Ireland,
       inadequacies highlighted to some extent by the Working Group in Chapter
       Eight of its Report, need first to be addressed. Addressing these inadequacies
       and establishing the system which must, it is submitted, be in place before the
       introduction of the changes proposed by the Working Group, will require the
       deployment of considerable resources. These resources will be needed to
       establish the entities, rules and employ and train the requisite staff and
       personnel to ensure that there is a body of qualified persons to ensure the
       accurate designation and implementation of any changes to the rules
       governing legal costs. In other jurisdictions, as addressed in Chapters Two
       and Eight of these Submissions, the introduction of rules governing legal
       costs, particularly those which involved any attempt to fix the levels of costs,
       have been preceded and accompanied by wide ranging structural reform of the
       legal systems in question. For this reason, as well as other reasons elaborated
       upon elsewhere in these Submissions, the Bar Council submits that it is not
       feasible and would not be workable to attempt to implement far-reaching
       reform of the law and rules governing legal costs in Ireland unless and until
       such reforms have taken place.




                                                                                          5
CHAPTER TWO                         GUIDELINES




2.01     The Working Group has recommended the establishment of a Legal Costs
         Regulatory Group (“the proposed Regulatory Group”). Among the
         responsibilities of this Group will be the setting of “guidelines” for the amount
         of recoverable costs. The Bar Council has a number of submissions to make
         regarding the content and effect of any such guidelines. However, there are
         certain preliminary points that need to be raised.


A.       Proposed “guidelines”


(i)      Scope of recommendation


2.02     The Working Group’s recommendations in relation to guidelines for legal
         costs refer to “recoverable costs”.1 This term, as it is used in the context of
         legal costs, is typically taken to refer to the costs, which the successful party to
         litigation may recover from the losing party. These costs are also referred to as
         “party and party costs”.2 The Bar Council makes these Submissions to the
         Implementation Advisory Group on the assumption that the Working Group’s
         recommendations in relation to the formulation of guidelines are confined to
         such costs as are recoverable between the parties to litigation.3 This
         interpretation is supported by the statement of paragraph 7.16 of the Report
         that, “The regulatory body could, if it was considered appropriate, also
         regulate costs in relation to noncontentious business.”4




1
  See Report of the Legal Costs Working Group (November 2005) at Chapter Five.
2
  See Report of the Legal Costs Working Group (November 2005) at para 3.4.
3
  This interpretation is supported by references to “recoverable costs” in the context of payment of
costs by the losing party to the winning party in litigation, throughout the Report of the Legal Costs
Working Group. See for example, paras 5.9, 5.10, 5.11, 5.17.
4
  See Report of the Legal Costs Working Group (November 2005) at para 7.16.



                                                                                                         6
2.03     The effect of this interpretation of the Working Group’s Report is that the
         recommended “guidelines” are directed neither at solicitor and client costs, as
         defined in paragraph 3.4 of the Report, nor costs incurred in relation to non-
         contentious business. The Bar Council’s understanding of the Working
         Group’s recommendations is therefore that, insofar as such work is concerned,
         the “guidelines” will not apply.5


2.04     The fact that the proposed “guidelines” will restrict the costs that are
         “recoverable” between parties to civil proceedings, has the effect that the
         successful party to proceedings may be left with outstanding liability for legal
         costs incurred in the course of the proceedings. This risk is particularly real if
         the guidelines governing the level of “recoverable” costs are fixed objectively
         and do not allow account to be taken of all of the factors which are relevant to
         the level of costs incurred in a particular case.


2.05     This could have the consequence that a person who has fully vindicated his
         position in civil proceedings, and incurred reasonable costs in that regard,
         would nonetheless face a bill for legal costs. This bill would not necessarily
         be confined to such costs as solicitor and client costs that are typically beyond
         the scope of recoverable costs.


2.06     The Bar Council has welcomed the Working Group’s support for the
         indemnity principle and the rule that “costs follow the event”.6 However, the
         Bar Council is concerned that guidelines which govern “recoverable costs”
         restrictively, will have the effect of abrogating the principle of indemnity. The
         Bar Council submits that this would be to the detriment of litigants and the
         Irish legal system and would be in conflict with the Working Group’s own
         support for the principle of “costs following the event” and the principle that




5
  This is subject to the caveat that the Report does provide that, “The regulatory body could, if it was
considered appropriate, also regulate costs in relation to noncontentious business” (para 7.16). Such
regulation, if adopted, could impact on costs incurred in the discharge of a barrister’s work in non-
contentious matters.
6
  See further Chapter One above.



                                                                                                           7
           “a person who wins an action should not suffer a financial penalty in
           vindicating their rights.”7


2.07       A further consequence of the fact that the guidelines address only “recoverable
           costs” is that parties may not be in an equal position in litigation. If the costs
           which a litigant can recover in the event of a successful outcome are limited
           excessively and on the basis of objective criteria, and he lacks the means to
           bear legal costs in excess of this level, he may be at a disadvantage as
           compared to a more well resourced opponent, who is willing to incur legal
           costs beyond those set by guidelines.


Submission 1


2.08       The Bar Council submits that the Implementation Advisory Group should be
           vigilant to ensure the principle that “costs follow the event”, the importance
           of which is recognised by the Working Group, is not undermined by
           excessively restrictive guidelines. The Bar Council also submits that the
           principle of equality of arms should be carefully guarded and protected in the
           formulation and implementation of the proposed guidelines.




(ii)       Effect of proposed guidelines


2.09       The effect of the guidelines for recoverable legal costs as proposed by the
           Legal Costs Working Group, need to be considered carefully. The Working
           Group “does not recommend the introduction of scales containing fixed costs
           beyond which costs are not recoverable.”8 The Bar Council wholly welcomes
           the recommendation that there should be no fixed scales of costs, a position
           which is also favoured by the experience of other jurisdictions, as explored
           below.    In particular, the Bar Council welcomes the statement in the Working
           Group’s Report that “a fixed scale may not comprehend the totality and
           complexity of the range of legal proceedings that emerge” and the Working

7
    Report of the Legal Costs Working Group at paras 5.15 and 5.17.



                                                                                                8
        Group’s concern that “it might not be realistic to have a ‘one price fits all’
        fee.”9


2.10    However, the Bar Council is concerned that certain descriptions of the effect
        of the “guidelines” in the Working Group’s Report indicate that they may not
        be entirely dissimilar in effect to fixed scales of costs.         First, the Working
        Group recommends that while “costs could be allowed in excess of those set
        out by the costs body… the onus should be on a party seeking costs higher
        than those prescribed to show why, in the particular circumstances of the case,
        the higher amount claimed should be paid”10. This recommendation suggests
        that the so-called “guidelines” are mandatory, and that there must be
        justifications for any deviation from the “guidelines”. This is more akin to the
        effect of fixed scales of costs, than that of “guidelines”, a fact that is
        confirmed by the experience of other jurisdictions, as will be seen below.


2.11    Secondly, the Working Group describes the proposed guidelines as
        “prescribed guidelines” and indicates that, “the guidelines would replace many
        of the individual items currently prescribed in Appendix W”.11 Appendix W
        does contain a scale of fixed costs. This was clear from an earlier stage of the
        Report, in which the Working Group described Appendix W as follows: “the
        fee prescribed in Appendix W may be a fixed amount, a scale or expressed as
        being at the discretion of the Taxing Master”.12


2.12    Thirdly, the Working Group’s Report cites the system of costs’ recovery that
        has been adopted in New Zealand as a model of “how a system of prescribed
        guidelines might be framed”.13 However, the system of recovery of costs in
        New Zealand purports to fix fee scales for recoverable costs and not just to
        furnish guidelines for such costs. This is apparent from the Working Group’s
        Report which states at paragraph 5.19, under the heading of “Fixed Fees” that,
        “New Zealand has a sophisticated model to determine the scale fee applicable

8
  Report of the Legal Costs Working Group (November 2005) at para 5.21.
9
  Report of the Legal Costs Working Group (November 2005) at para 5.20.
10
   Report of the Legal Costs Working Group (November 2005) at para 5.23.
11
   Report of the Legal Costs Working Group (November 2005) at para 5.27.
12
   Report of the Legal Costs Working Group (November 2005) at para 3.9.
13
   Report of the Legal Costs Working Group (November 2005) at para 5.25.



                                                                                                9
         to the various stages of a proceeding”. The fact that the Working Group cites
         the model of New Zealand as a model for the proposed guidelines gives the
         Bar Council further cause for concern as to the intended effect and true
         character of the so-called “guidelines”.


2.13     The Bar Council accordingly wishes to express its concern that, while the
         Working Group has decided against the introduction of fixed scales, for strong
         and unassailable reasons, the effect of the guidelines may not be very different
         in all but name. This concern is heightened by the fact that the experience of
         Ireland, and other jurisdictions, has demonstrated that, unless the scope of
         rules governing fixed scales is limited and contained, such rules suffer from
         numerous shortcomings.


England


2.14     In England, the “Interim Report on Access to Justice” (June 1995) and the
         “Final Report on Access to Justice” (July 1996) recommended the introduction
         of fixed costs for “fast track” cases. This has only been done in limited
         categories of cases, such as certain motor vehicle cases in which the claim is
         worth less than £10,000. The Civil Procedure Rules do however fix the costs
         for the trial of cases that are allocated to the “fast track”. These fixed costs do
         not relate to, or affect, pre-trial costs.14 The costs are fixed as follows:15


    For claims worth up to £3,000, the court can award fast track trial costs of £350;


    For claims worth between £3,000 and £10,000, the court can award £500;


    For claims worth more than £10,000, the court can award £750.


2.15     The court may apportion the costs awarded between the parties in accordance
         with their respective success at trial. Where the claim is for money only, there


14
   The rule which introduces this regime, Rule 46, applies to the costs of an advocate for preparing for
and appearing at the trial of a claim in the fast track but does not include disbursements or value added
tax. Rule 46.1(2).
15
   Civil Procedure Rules, Rule 46.2(1).



                                                                                                       10
         are particular rules for quantifying the value of a claim for the purpose of
         computing the fast track costs.16 Where the claim is for a remedy other than
         the payment of money, the value of the claim is deemed to be between £3,000
         and £10,000, unless the court orders otherwise.17 The court may generally not
         award more or less than the fixed costs indicated above.18


2.16     The system of fixed costs is not without exceptions. For example, the court
         has a discretion regarding the award of fast track costs based on the conduct of
         the parties. In particular, the court can award less than the fast track costs
         where the court believes that the party to whom the costs are to be awarded
         has behaved unreasonably or improperly during the trial.19 Conversely, if the
         court considers that that party who is liable to pay the fast track costs has
         behaved improperly during the trial, the court can award additional amounts to
         the other party as it considers appropriate.20 Moreover, the court can decide
         not to award fast track costs.21


2.17     The Bar Council notes that, if fast track costs are awarded and the court
         considers the attendance of a legal representative (typically a solicitor) to have
         been necessary to assist the advocate (such as a barrister), the court can award
         an additional £250 in respect of the attendance of that legal representative at
         the trial.22


2.18     The Judicial Studies Board has examined the operation of these cost rules and
         noted that,




16
   Civil Procedure Rules, Rule 46.2(3) These rules are as follows: “(a) for the purpose of quantifying
fast track trial costs awarded to a claimant, the value of the claim is the total amount of the judgment
excluding – (i) Interest and costs; and (ii) any reduction made for contributory negligence. (b) for the
purpose of the quantifying fast track trial costs awarded to a defendant, the value of the claim is – (i)
the amount specified in the claim form (excluding interest and costs); (ii) if no amount is specified, the
maximum amount which the claimant reasonably expected to recover according to the statement of
value included in the claim form… ; or (iii) more than £10,000, if the claim form states that that
claimant cannot reasonably say how much he expects to recover.”
17
   Civil Procedure Rules, Rule 46.2(4).
18
   There are a number of exceptions contained in Rule 46.3, not all of which are addressed here.
19
   Civil Procedure Rules, Rule 46.3(7).
20
   Civil Procedure Rules, Rule 46.3(8).
21
   Civil Procedure Rules, Rule 46.2(2).
22
   Civil Procedure Rules, Rule 46.3(2).



                                                                                                        11
      “The amounts specified for fixed trial costs include the advocate’s preparation
      for trial, getting to and from court, and conducting the trial, and are not capable
      of being increased if the hearing goes beyond the first day. Nor can the fixed
      trial costs be reduced if the hearing is brief. This remains the position even if the
      start of a fast track trial is delayed because an emergency application had to be
      dealt with, or the advocates in the trial requested and were granted time, in
      either situation causing it to run over into a second day.”23


2.19       The Judicial Studies Board also noted, “You have no need to concern yourself
           with ascertaining a brief fee, and indeed should not do so even if invited to
           make enquiry. The amount being paid to the receiving party’s advocate is
           irrelevant, the fixed trial costs prevailing.” This point was reiterated as
           follows:


      “Sometimes it may be disclosed at conclusion of a fast track trial that counsel
      for the receiving party has appeared for a brief fee of less than the fixed trial
      costs provided for by Rule 46.2(1), the paying party arguing that in the
      circumstances the costs awarded should be limited to the amount on the brief.
      You should reject any submission inviting you to proceed in this way. It is no
      concern of the paying party or the court what the advocate is paid, the amount to
      be allowed is the appropriate sum in the table of fixed trial costs.”24


2.20       With regard to the provision for additional payment for the attendance of a
           legal representative to assist the advocate, the Judicial Studies Board made
           the following observations:


      “At first sight this provision appears straightforward. As a general rule fast track
      trials will not require more than one legal representative to be in court, namely
      the advocate. However, although the position should change quite soon, at
      December 2000, if the advocate is attended by another person from the
      instructing solicitors’ office, the court is bound to accept that the person was
      ‘necessary’. This is because the Law Society’s Rules of Conduct require


23
     Judicial Studies Board, “ Civil Bench Book: Costs” at para 8.37.
24
     Judicial Studies Board, “ Civil Bench Book: Costs” at para 8.38.



                                                                                              12
  counsel be attended, and the Court of Appeal in Hughes v Kingston Upon Hull
  City Council [1992] 2 All ER 49 held that the Rules of Conduct have statutory
  effect. At the request of the Head of Civil Justice, the Law Society have
  amended the Rule, but until it has been through a prolonged approval process
  the revision cannot take effect. Upon implementation, the revised Rule will have
  the following effect.


  ‘126. Attendance on counsel will normally be dispensed with in fast track and
  small claims track civil cases except:

  (a) where the case is more complex than a typical small claims or fast track
       case;
  (b) where the determination of costs at the conclusion of proceedings requires
       the presence of the solicitor;
  (c) where one of the parties in the case is a child;
  (d) where the client is unable to understand the proceedings or give adequate
       instructions to counsel because of inadequate knowledge of English, mental
       illness or other mental or physical disability;
  (e) where counsel is representing more than one party;
  (f) where the client is likely to disrupt the proceedings if counsel were to appear
       alone;
  (g) where there are any issues likely to arise which question the client’s
       character or the solicitor’s conduct of the case;
  (h) where there is any other exceptional circumstance which makes it desirable
       that counsel be attended.’”

2.21   The introduction of fixed costs for fast track trials in England are part of a full
       procedural review and have been introduced only in relation to a limited
       category of cases. The above analysis of that system, demonstrates the
       difficulties and complexities which are inherent in any attempt to fix the costs
       of litigation. It is also clear that there are significant procedural and structural
       differences between the Irish and English legal systems, which make any
       direct comparisons and guidance difficult to draw. However, the Bar Council
       notes that, even in the limited contexts in which fixed costs have been
       introduced in England, they allow of exceptions.


                                                                                          13
2.22     The Bar Council considers that the effect of “fixed costs” in England, subject,
         as they are, to the exceptions out-lined above, is quite similar to the effect of
         the “guidelines” as they are proposed by the Working Group. The Bar
         Council submits that, before a system governing costs, and resembling the
         mandatory effect of a fixed costs’ regime, could be introduced, it is necessary
         to conduct a thorough analysis of the experience of other jurisdictions, the
         costs and benefits of such a system and the risks which are inherent in any
         attempt to fix legal costs directly.


New Zealand


2.23     The New Zealand Law Commission analysed the system of fixed recoverable
         costs as follows:-


     “In New Zealand, the use of scales to set lawyers’ fees, even non-compulsory
     benchmark scales, has been and remains controversial. In the case of fixed fee
     scales, there is concern that these can become inflexible and may not reflect
     market rates unless reviewed regularly. They can place a “floor” under market
     prices – holding prices up – and reduce competition… It is not clear if New
     Zealand’s cost recovery rules influence the actual fees lawyers charge.
     Anecdotally, there seems to be little direct connection between the fees lawyers
     charge and the amount of costs awarded under the cost recovery rules.”25


2.24     The New Zealand Law Commission also noted that a system of fixed costs is
         “inflexible and does not recognise the wide variety of work undertaken by
         lawyers. There is a danger that infrequent amendment of fixed scales will
         either fail to keep up with market prices, or will place a floor under market
         prices and keep fees unrealistically high.”26




25
   New Zealand Law Commission, Seeking Solutions: Options for Change to the New Zealand Court
System (Preliminary Paper 52, December 2002).
26
   New Zealand Law Commission, “Delivering Justice for All: A Vision for New Zealand Courts and
Tribunals (Report 85, March 2004), Part 2, “Access to Courts”.



                                                                                              14
New South Wales


2.25      In New South Wales legal costs were formerly regulated by means of fixed
          scales. This system was found to have curtailed competition and to have kept
          costs at an artificially high level. In particular, there was a perception that
          “scales of fees had become base fees and stifled competition”.27 The scales
          were also criticised as being “highly complex and administratively
          cumbersome.”28 The scales were therefore removed in 1994, and replaced by
          a system which focused on disclosure rather than fixed costs. This so-called
          deregulation was generally agreed to have been successful and to have
          enhanced competition.29


Australia (Federal Courts)


2.26      While the Australian federal courts do have fixed scales for party and party
          legal costs, the Australian Attorney General’s Department has examined the
          merits of this system and identified a number of weaknesses with the system,
          including the following:-


     “(i) the present scales are expected to serve too many policy goals;
     (ii) the present scales create uncertainty;
     (iii) the present scales create a disincentive to settle and the incentive to prolong
     litigation;
     (iv) the present scales encourage wastage of resources; and
     (v) the present scales bias expenditure towards certain inputs and away from
     others.”30




27
   New South Wales’ Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper,
November 2004) at para 1.3.
28
   New South Wales’ Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper,
November 2004) at para 1.2.
29
   See New South Wales, Office of the Attorney General, Legislation and Policy Division, “Review of
the Legal Profession Act Final Report”.
30
   Attorney General’s Department, Report of the Review of Scales of Legal Professional Fees in
Federal Jurisdictions (March 31, 1998) at para 2.15 (Australia).



                                                                                                 15
Ontario

2.27       The Rules of Civil Procedure in Ontario originally set out general factors that
           were to be used in assessing costs.31 This provision was substantially
           amended in 2002 by the introduction of a costs grid, which created a formula
           for determining hourly rates for lawyers based on years of experience. The
           objective of the grid was to make costs more predictable, uniform and
           consistent.


2.28       This costs grid was perceived as being overly generous and leading to higher
           costs. The courts and taxing masters therefore began to treat the grid as a
           ceiling for fees and exercised their discretion to award costs below the level
           fixed by the grid. The following dicta of the Ontario Court of Appeal was
           cited in a paper by Nordheimer J.:-


             “1.    The fixing of costs is not simply a mechanical exercise. In
             particular the fixing of costs does not begin and end with a
             calculation of hours times rates. That result is but one factor in the
             assessment process, together with the other factors in Rule 57.01.
             2.     While it is appropriate to do the costs grid calculation it is also
             necessary to step back and consider the result produced and question
             whether, in all the circumstances, the result is fair and reasonable.
             3.     In deciding what is fair and reasonable … the expectation of
             the parties concerning the quantum of a costs award is a relevant
             factor.”32


2.29       This approach reduced the predictability and consistency for which the grid
           was designed. The grid was therefore removed in 2005 and replaced by a
           system of assessment of costs based on the discretionary factors set out in
           Rule 57.01 of the Civil Procedure Rules.




31
     Civil Procedure Rules, Rule 57.01 (Ontario).



                                                                                            16
Ireland


2.30      The weaknesses of a system of fixed costs have also been seen in Ireland, and
          in particular, in the operation of Appendix W to the Rules of the Superior
          Courts.33 The Competition Authority has also expressed disapproval of a
          system of fixed costs, stating that, “The setting of fees by regulation is harmful
          to competition.”34


Submission 2


2.31      In light of the criticisms and failures of fixed scales systems in Ireland and
          elsewhere, the Bar Council strongly endorses the Working Group’s
          recommendation that such fixed scales should not be introduced. The Bar
          Council submits that fixed scales are anti-competitive and are neither
          desirable nor workable as a means of determining legal costs. The Bar
          Council accordingly submits that the guidelines that are proposed by the
          Working Group should not have the same, or a similar effect, as fixed scales of
          legal costs. For this reason, the Bar Council submits that the Implementation
          Advisory Group should ensure that the proposed guidelines do not directly or
          indirectly have the same effect as fixed scales for recoverable legal costs.


2.32      If the proposed guidelines will be truly flexible and adaptable and not
          equivalent to fixed scales, there are other concerns that need to be addressed.
          In particular, the Bar Council notes that where such guidelines have been
          introduced, the experience does not appear to have been wholly positive.


2.33      The example of New Zealand may be cited. In New Zealand, the High Court
          Rules contain rules for the determination of recoverable costs, which fix a
          daily recovery rate, based on an objective assessment of both the complexity
          of the case and the time it requires. While these scales appear to have been

32
   Paper by Justice Ian Nordheimer “Civil Law Update – Costs” (Spring Education Seminar, May 4,
2005.), quoting decision in Boucher v. Public Accountants Council for the State of Ontario (2004) 71
O.R. 3d 291.
33
   See Report of the Legal Costs Working Group (November 2005) at para 2.20.
34
   Competition Authority, “Study of Competition in Legal Services” (Preliminary Report, February 24,
2005) at para 12.22.



                                                                                                  17
           intended to guide the costs charged beyond the scope of their direct
           application, there appears to be widespread ignorance of these rules in New
           Zealand and it has been recorded by the New Zealand Law Reform
           Commission that the amounts allowed do not reflect the true level of legal
           costs being charged, that they fail to fully compensate successful litigants and
           that, despite being updated regularly, the sums allowed are at times
           “derisory”.35 The Bar Council submits that the failings of the system that was
           introduced in New Zealand should be borne in mind by the Implementation
           Advisory Group in giving effect to the recommendations contained in the
           Report of the Legal Costs Working Group.


2.34       Another system which may be regarded as bearing similarity to the
           “guidelines” recommended by the Working Group, was introduced recently in
           England. Since the introduction of “fast track” cases in England for certain
           categories of cases, and the necessity of “summary assessment” of legal costs,
           there have been guidelines introduced in that jurisdiction to assist judges in the
           assessment of costs. It should be noted that the categories of cases to which
           these guidelines apply are very particular and limited. However, despite the
           limited scope of the costs guides, the Supreme Court Costs Office, which has
           drawn up these “guides”, states clearly that,


      “As to the standing of the Guide it is, as it makes clear, no more than a guide
      and a starting point for Judges carrying out summary assessment. The figures
      set out in Appendix 2 to the Guide are broad approximations only. The Guide is
      intended to be of help and assistance to Judges but is not intended as a substitute
      for the proper exercise of their discretion having heard argument on the issues to
      be decided.”36


2.35       The Office further clarified that, in relation to solicitors’ legal costs, “The
           guideline rates are not scale figures: they are broad approximations only.”37



35
     See further above.
36
     Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004).
37
     Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004).



                                                                                                 18
2.36     The guidelines for counsel’s fees were described as follows:


     “A proper measure for Counsels' fees is to estimate what fee a hypothetical
     Counsel, capable of conducting the case effectively, but unable or unwilling to
     insist on the higher fees sometimes demanded by Counsel of pre-eminent
     reputation, would be content to take on the brief: but there is no precise standard
     of measurement and the judge must, using his or her knowledge and experience,
     determine the proper figure. (Per Pennycuick J in Simpsons Motor Sales
     (London) Ltd. v Hendon Borough Council [1965] 1 WLR 112.)”38


2.37     The Supreme Court Costs Office further clarified that the table of counsel’s
         fees which was drawn up for “proceedings in run of the mill cases in the
         Queen’s Bench and Chancery Divisions and in the Administrative Court… are
         not recommended rates but it is hoped that Judges may find the figures of
         some help when they are called upon to assess Counsel’s fees.” In this regard
         it was noted that, “It has not been possible to publish more specific guideline
         figures because of lack of sufficient data” and that “The figures… are based
         upon figures supplied by the Bar and in broad terms the figures are averages
         based on the information supplied.”39


2.38     The Costs Office proceeded to state that the figures for recommended brief
         fees may be reduced for less experienced counsel and increased for more
         experienced counsel, as the “guideline figures are a starting point only and the
         Court has the discretion to allow fees appropriate to the particular
         circumstances of the appeal.”40


2.39     The Bar Council submits that the effect of the guides drawn up in England is
         not the same or similar to scales of costs and may be used as a model for the
         proposed guidelines recommended by the Working Group in this jurisdiction.
         In particular, the Bar Council draws the Implementation Advisory Group’s

38
   Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004) at
para 47.
39
   Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004) at
paras 48-49.
40
   Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004) at
paras 70.



                                                                                                 19
        attention to the fact that the guides which have been promulgated (and
        periodicially updated) in England expressly refuse to impinge upon the
        discretion of the court regarding costs. The guides as to costs are merely
        starting points, and are not recommended rates. Moreover, the Bar Council
        notes that the it was not considered appropriate to fix hourly rates for counsel
        as the Supreme Court Costs Office considered that this would “reward the
        indolent and penalise the expeditious”.41


2.40    The Bar Council is mindful of the fact that it was only in “fast track” cases or
        cases the trial of which lasted less than one day, that it was considered
        appropriate to issue guidance in relation to the level of costs. This is a fact
        which must be borne in mind by the Implementation Advisory Group.


Submission 3


2.41    The Bar Council submits that, while the context within which the cost guides
        were formulated in England is very particular and must be born in mind in
        assessing that costs’ system, the costs guidelines of that jurisdiction appear to
        truly have the effect of guidelines rather than scales of costs. The Bar Council
        therefore submits that the effect (if not necessarily the content) of the English
        costs’ guidelines should be considered as a useful model by the
        Implementation Advisory Group.


2.42    A further point regarding the effect of the proposed guidelines, is that the
        Working Group, at paragraph 7.17 of the Report, recommends that the “cost
        recovery guidelines… would inform billing and assessment.” The Bar
        Council considers that this recommendation reflects the appropriate weight to
        attach to the proposed guidelines. It is submitted that guidelines with a more
        direct effect than “informing” the level of legal costs, would effectively
        constitute scales of costs. The Bar Council reiterates that the proposed
        guidelines should only be of relevance as a guide and a means of “informing”



41
  Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004) at
paras 70.



                                                                                                20
           the appropriate level of legal costs and should not have the same, or a similar
           effect, as scales of fixed costs.


Submission 4


2.43       The Bar Council reiterates that the proposed guidelines should only be of
           relevance as a guide and a means of “informing” the appropriate level of
           legal costs and should not have the same, or a similar, effect as scales of fixed
           costs.


2.44       A final point to note about the effect of the Working Group’s proposed
           guidelines for recoverable costs, is that there is one reference in the Report to
           “limits” on costs. At paragraph 7.18, the Working Group recommends the
           establishment of a legal costs regulatory body which would exercise “new
           powers to set guidelines and limits in respect of costs” (emphasis added). This
           is the sole reference in the Report to limits being imposed on recoverable costs
           and there is no elaboration or explanation regarding the formulation or
           imposition, of such “limits”.


2.45       The Bar Council is concerned that imposing “limits” on recoverable costs is a
           step further than the “guidelines” recommended and considered throughout the
           Working Group’s Report. In the absence of more detailed information, the
           Bar Council does not propose to make submissions in relation to this single
           reference to the imposition of “limits” on recoverable costs. However, the Bar
           Council would draw the attention of the Implementation Advisory Group to
           the fact that the Working Group’s Report does not favour “fixed scales” and
           that it expressly recommends that costs can be allowed in excess of those set
           out in the proposed guidelines.42 The Bar Council would also draw the
           attention of the Implementation Advisory Group to the negative reception and
           experience of “caps” on legal costs in other jurisdictions.


2.46       The Civil Justice Council in England noted a judicial determination to the
           effect that,

42
     See Report of the Legal Costs Working Group at paras 5.21 and 5.23.



                                                                                           21
     “…a prospective costs capping order should only be contemplated where there
     are grounds for believing that a party may incur excessive or disproportionate
     legal costs and where the risk that excessive legal costs are being incurred
     unnecessarily will not be picked up by the court when exercising case
     management functions, or when conducting a detailed assessment of costs after
     the trial. Costs capping was a relatively dramatic course to take and would only
     be ordered on cogent evidence."43


2.47     The Civil Justice Council proceeded to recommend that “in non personal
         injury fast track and multi track cases below a value of £1m costs
         capping/budgeting should not apply unless the Court orders otherwise.”44


Submission 5


2.48     The Bar Council requests clarification in relation to the “limits” referred to at
         paragraph 7.18 of the Report and would welcome the opportunity to make
         such further submissions as may be appropriate, upon receipt of the requested
         clarification


(iii)    Formulation of proposed “guidelines”
2.49     The Working Group recommends the establishment of a Legal Costs
         Regulatory Group with responsibility for drawing up guidelines for the
         quantification of recoverable costs. It is necessary to examine the content of
         this proposal. In this regard, there appear to be certain inconsistencies and
         ambiguities in the various descriptions of the proposed guidelines in the
         Report itself. It is therefore proposed to consider the areas of apparent
         uncertainty in relation to the proposed guidelines, and then to address the
         various possibilities and alternatives for the formulation of the guidelines, in
         the ensuing submissions.




43
   Civil Justice Council “Improving Access to Justice: Funding Options and Proportionate Costs”
(August 2005) at para 13, citing Sayers v SmithKline Beecham [2004] EWHC 1899 (QB) Keith J.
44
   Civil Justice Council “Improving Access to Justice: Funding Options and Proportionate Costs”
(August 2005) at para 13.



                                                                                                  22
2.50    The Working Group variously described these guidelines in the following
        language:-


     (a) “cost guidelines… based on an assessment of the amount and nature of work
        required to be done in such a case and comprehend such elements as:


             the appropriate hours expended by the various persons to be
                 remunerated,


             the complexity of the proceedings and the stages therein, and


             the level of the court in which the case is heard;”45


     (b) “While some cognisance should be given to the financial value of the claim or
        counterclaim in dispute and the complexity of the case,… costs should be
        primarily assessed by reference to work actually and appropriately done and
        … the level of recoverable costs should not be proportionate to that value nor
        should it be the main determinant of the amount of costs recoverable;”46


     (c) “the amounts of legal costs that normally can be expected to be recovered in
        respect of particular types of proceedings or steps within proceedings for each
        jurisdiction;”47


     (d) “guidelines on amounts deemed reasonable with reference to the time that
        would generally be expended on the task;”48


     (e) “the recoverable costs set by the body would encompass a financial amount
        measured against a timeframe;”49




45
   Report of the Legal Costs Working Group (November 2005) at para 2.3.
46
   Report of the Legal Costs Working Group (November 2005) at para 2.6.
47
   Report of the Legal Costs Working Group (November 2005) at para 5.22.
48
   Report of the Legal Costs Working Group (November 2005) at para 5.22.
49
   Report of the Legal Costs Working Group (November 2005) at para 5.22.



                                                                                        23
       (f) “a set of fee guidelines for each aspect of work done adjusted to take into
           consideration the time taken in conducting the action, its complexity and the
           jurisdictional level of the action;”50


       (g) “recoverable costs should only be for work actually and appropriately done
           with reference to the time that might reasonably be expended on the identified
           task by a competent lawyer;”51 and


       (h) “set ranges for the maximum number of hours which may be normally
           recoverable as party and party costs for particular types of proceedings or
           steps within proceedings.”52


2.51       These descriptions and recommendations are not wholly consistent with each
           other. On the contrary, there are some significant variations in the
           descriptions of the mechanisms and criteria to be used in the formulation and
           application of the proposed guidelines. First, the proposed guidelines for
           recoverable costs involve an objective assessment of the work for which the
           legal costs are due, according to (a), (c), (d) and (h) above. However, the
           description of these guidelines at (b), (f) and (g) suggests that the appropriate
           legal costs should be measured by reference to the work actually done. This is
           an important distinction and the Bar Council makes submissions in this regard
           below.


2.52       A second inconsistency in the description of the proposed guidelines in the
           Working Group’s Report relates to the quantification of the time for which the
           legal costs should be payable. This criterion for assessing the appropriate
           level of legal costs is variously described as the “appropriate hours expended
           by the various persons to be remunerated” ((a) above); the “time that would
           generally be expended” ((d) above); “the time taken in conducting the action”
           ((f) above); the “time that might reasonably be expended… by a competent
           lawyer” ((g) above) and “set ranges for the maximum number of hours which
           may be normally recoverable” ((h) above).



50
     Report of the Legal Costs Working Group (November 2005) at para 5.24.



                                                                                           24
2.53       This list includes both objective and subjective means of quantifying the time
           on which the proposed guidelines should be based and contains different
           objective standards for such quantification. By way of illustration, the
           guidelines, according to the Report, could be based on the time that would
           generally be expended, the time that would reasonably be expended, the
           maximum number of hours that would normally be expended or the time that
           was actually expended. The Bar Council makes submissions on this point
           below.


2.54       A third aspect of the proposed guidelines which is not entirely clear in the
           Working Group’s Report, relates to the factors which should be considered in
           setting such guidelines. At paragraph 2.2 of the Report, the Working Group
           recommends that the guidelines take account of “the complexity of the
           proceedings and the stages therein”. The complexity of the proceedings is not
           referred to in other descriptions of the proposed guidelines. In the
           recommendations quoted at (a) to (h) above, only two of the formulations of
           the proposed guidelines envisage consideration being given to the complexity
           of the proceedings.


2.55       Another factor that is included in some formulations of the proposed
           guidelines is the jurisdictional level of the proceedings. This is mentioned as
           a relevant criterion in three places in the Report (see (a), (c) and (f) above), but
           not in the other descriptions of the proposed guidelines. A further factor that
           may be relevant to the level of legal costs, according to the Working Group, is
           the value of the claim. The Working Group recommends that “some
           cognizance should be given to the financial value of the claim or counterclaim
           in dispute” (see (b) above) but does not expressly include this criterion in the
           description of the proposed guidelines for setting recoverable costs.


2.56       A final point that may be noted, is that the Working Group’s recommendations
           regarding the elements that may be encompassed in the proposed guidelines,
           do not purport to be exhaustive. On the contrary, the Working Group states

51
     Report of the Legal Costs Working Group (November 2005) at para 5.24. See also para 5.32.
52
     Report of the Legal Costs Working Group (November 2005) at para 7.17.



                                                                                                 25
           that the guidelines should “comprehend such elements as” those listed in the
           Report.53 The Bar Council makes submissions below in relation to the factors
           that should be taken into account in setting guidelines for recoverable legal
           costs.


2.57       A fourth area of inconsistency in relation to the proposed guidelines for the
           assessment of recoverable costs is the mechanism to be used to assess costs.
           There are various alternative means of fixing costs guidelines, ranging from
           rigid scales stipulating the costs payable for defined tasks, to guidelines based
           on a subjective assessment of the work done. The Working Group in its
           Report, recommends a number of different means of setting guidelines for
           legal costs. These recommendations include the recommendation that the
           guidelines be based on the work actually done (see (g) and (h) above), and the
           recommendation that the guidelines be based on the costs that are objectively
           reasonable or normal (see (c) and (d) above). The Report also recommends
           that no fixed scales be adopted,54 while recommending the introduction of “set
           ranges for the maximum number of hours which may be normally
           recoverable” (see (h) above) and a “financial amount measured against a
           timeframe” (see (e) above). These means of formulating the guidelines for
           recoverable costs, as well as the approaches that have been adopted in other
           jurisdictions, are addressed in the Bar Council’s submissions below.


Submission 6


2.58       The Bar Council submits to the Implementation Advisory Group that the
           Working Group’s Report refers to a number of different possible means of
           formulating and implementing the proposed “guidelines”, not all of which are
           consistent with each other. While the Bar Council attempts to make
           submissions in relation to the guidelines proposed by the Working Group, the
           ambiguities and inconsistencies in relation to this aspect of the Report, make it
           difficult to furnish definitive submissions. The Bar Council therefore hopes
           that it will have the opportunity to make more informed and concrete

53
     Report of the Legal Costs Working Group (November 2005) at para 2.3.
54
     See Report of the Legal Costs Working Group (November 2005) at para 2.5.



                                                                                           26
           submissions, when the content, scope and effect of the proposed guidelines
           have been further clarified.


(iv)       Implementation of proposed “guidelines”


2.59       The Working Group does not make any specific recommendations regarding
           when and by whom the proposed “guidelines” would be applied. The Bar
           Council welcomes further clarification in this regard and would welcome the
           opportunity to make additional submissions upon receipt of such clarification.



B          Submissions on proposed “guidelines”


       (i) Assessment of work done


2.60       The description of the proposed guidelines in the Working Group’s Report
           refers to both objective and subjective means of assessing the work done.
           There are models for the objective assessment of legal work in other
           jurisdictions. By way of example, the Bar Council is aware that New Zealand
           has adopted a system for the recovery of costs that involves the designation of
           cases into one of three categories depending upon its complexity and
           significance and one of three categories depending upon the time which is
           considered to be reasonably required for the work in question.55 According to
           these rules, the legal costs that are recoverable are not defined by the actual
           costs incurred.


2.61       The Law Commission of New Zealand has considered these rules governing
           recoverable costs. In its report, “Delivering Justice for All: A Vision for New
           Zealand Courts and Tribunals,”56 the Law Commission made a number of
           observations and recorded a number of findings that were critical of the
           system of objective calculation of recoverable legal costs.



55
     See High Court Rules, Rules 46, 47 and 48 (New Zealand).
56
     New Zealand Law Commission, Report 85, March 2004.



                                                                                             27
2.62     The first criticism was the rules were complex and difficult to understand.
         The Law Commission stated:


     “They are designed for use by lawyers who know more or less how much work
     a particular matter might demand, and for judges in making costs orders, and are
     not written in a way that will easily inform a non-lawyer. Indeed, since the High
     Court Rules foresee that cost recovery will represent two-thirds of the daily rate
     considered reasonable in relation to the work, the rules may in fact be
     misleading as a guide on fee levels.”57


2.63     A second criticism was that the rules were not widely applied. The Law
         Commission made the important observation that, “In New Zealand
         information about these rules, or even the fact that they exist, is poor and in
         reality, lawyers’ fees bear little relationship to the rules.”58


2.64     A further criticism was that successful parties to litigation rarely recover their
         costs in full. The Law Commission noted in this regard that, under the High
         Court Rules referred to above, and described at paragraph 5.19 of the Working
         Group’s Report, “A complex assessment is carried out for each proceeding,
         but successful parties seldom recover costs in full.”


2.65     Finally, it is of significant interest to note that the Law Commission of New
         Zealand regarded the costs which were awarded under the High Court Rules
         described above, did not reflect the true legal costs and were inadequate. The
         Law Commission noted,


     “The Buddle Findlay survey of leading New Zealand companies commented
     that costs awarded under the High Court Rules bear little relationship to the real
     costs incurred in major commercial litigation and are often regarded as
     ‘derisory’.”59



57
   New Zealand Law Commission, Report 85, March 2004, para. 141.
58
   New Zealand Law Commission, Report 85, March 2004, para. 137.
59
   New Zealand Law Commission, Seeking Solutions: Options for Change to the New Zealand Court
System (Preliminary Paper 52, December 2002), Part 2, “Access to Courts” at p 94.



                                                                                            28
2.66     It is particularly interesting to note this latter apparent failing of the New
         Zealand costs recovery system, when one considers that the scales of
         recoverable costs are regularly updated in New Zealand60, and yet still fail to
         reflect the true costs incurred in certain forms of litigation.


2.67     From a review of the rules governing the recoverable legal costs in New
         Zealand and the experience of that system, as documented by the New
         Zealand Law Commission, the Bar Council is concerned that a system which
         attempts to quantify legal costs on the basis of an objective assessment of the
         matter in question and the time and work required, as was attempted in New
         Zealand, will find it difficult to avoid the following shortcomings:61


        The formulation of any rule for the objective assessment of work required,
         will either have to be highly complex, and subject to extensive exceptions and
         qualifications, or it will not be workable;


        A complex set of rules and systems for the determination of recoverable legal
         costs on the basis of objective criteria will not be easily understood by
         consumers;


        If the objective means of assessing recoverable legal costs is not compulsory,
         it is likely that it will not be applied in practice, as has been experienced in
         New Zealand;


        There is a significant danger that any attempt to fix guidelines for costs on an
         objective basis will not accurately reflect the costs that have been incurred (the
         experience in New Zealand where, despite the scales being updated regularly,
         the costs are regarded as derisory, heightens this concern);




60
   See, for example, High Court Amendment Rules (No. 2) 2003, which increased the “daily recovery
rates” with effect from January 1, 2004.
61
   These concerns are supplemental to the broader concerns of the Bar Council in relation to a system
of fixed costs guidelines, which are addressed in more detail below.



                                                                                                    29
          If an objective assessment of work required is undertaken, for the purpose of
           computing recoverable legal costs, a successful litigant will be unlikely to
           recover the full legal costs incurred and will thereby be prejudiced;


          The necessity to categorise a case and the work objectively involved in such a
           case, will create additional costs.


2.68       As has been seen, the Working Group’s Report envisages the possibility that
           the proposed guidelines for recoverable costs could take account of both
           objective and subjective assessments of the work done. It is the Bar Council’s
           submission to the Implementation Advisory Group that it is more accurate,
           more workable, and more realistic, to formulate the guidelines in a manner
           which encompasses the work actually done in a particular case, rather than
           relying on an objective assessment of that work.


Submission 7


2.69       It is the Bar Council submission to the Implementation Advisory Group that it
           is more accurate, more workable, and more realistic, to formulate the
           guidelines in a manner which encompasses the work actually done in a
           particular case, rather than relying on an objective assessment of that work.


(ii)       Criterion of time spent


2.70       The Working Group recommends that the guidelines on costs be fixed
           according to the time spent on the work in question. As noted above, the
           Working Group’s Report contains various description of this criterion, ranging
           from references to the time that would generally be expended, the time that
           would reasonably be expended, the maximum number of hours that would
           normally be expended or the time that was actually expended. It therefore
           leaves open the possibility of employing either an objective assessment of the
           time required or a subjective assessment of the time actually spent on the work
           in question.




                                                                                           30
2.71   The Bar Council notes at the outset that it is not the established practice of
       Irish barristers to charge fees on the basis of time expended. The Bar Council
       is concerned that the introduction of a system of costs assessment based
       strictly on time expended will encourage inefficiency, will lead to extra
       categories of legal costs being incurred, and will not be to the benefit of
       clients, among other weaknesses.


2.72   The Bar Council has considered the debate in other jurisdictions regarding
       time-based billing. In New South Wales, Chief Justice Spigelman
       commented at the Opening of the Law Term Dinner on the 2nd February, 2004,
       that,


  “One thing that has occurred over that period of ten years is that time based
  charging has become almost universal. I do not believe that this is sustainable. I
  note that last year, your past President, Robert Benjamin, published in the Law
  Society Journal a thoughtful piece on the tyranny of the billable hour. As I and
  my predecessor, Chief Justice Gleeson, have often said over the years, it is
  difficult to justify a system in which inefficiency is rewarded with higher
  remuneration. The difficulty of course is that the person providing the service,
  namely the legal practitioner, does not have a financial incentive to do the
  service as quickly as possible.”


2.73   A Legal Fees Review Panel was subsequently established, which issued a
       discussion paper on “Lawyers Costs and Time Billing” in November, 2004.
       This Discussion Paper considered some of the negative consequences of the
       time-based billing, such as inflated fees; unethical billing practices; damage to
       the lawyer-client relationship; rewards for inefficiency; the lack of any
       connection between the outcome of the matter and the fee charged; among
       others. The Review Panel quoted the following list of criticisms of the
       practice of hourly billing:


      “Total legal expense to clients is too high;

      There is little incentive for efficiency and early resolution of matters;




                                                                                        31
        Risk-sharing between lawyer and client is absent;

        The effective, efficient lawyer is not fairly compensated;

        The cost-effectiveness and benefits of systems and technology are not
         recognised;

        The value of the services rendered to the client may not be fairly measured;
         and

        Nobody can predict with certainty what the fee will be.”62




2.74     The Legal Fees Review Panel noted that,


     “[i]t appears that clients under the present system of hourly billing are not in a
     position to freely communicate with their lawyer about their matter or the bills
     of costs they receive because of the pressure to incur the minimum expenses.
     Anecdotal comment… suggests the legal profession see the final bill as a
     ‘bottom line’ and clients would prefer their issues were dealt with in the
     minimum time possible than have longer and more detailed consultations.”63


2.75     The Review Panel described the negative effect of hourly billing on the
         lawyer-client relationship as follows:


     “It is not just overcharging however that is of concern to the critics of hourly
     billing, the effects on the lawyer/client relationship have had an equally
     devastating effect. The unfortunate consequence in focusing on billing as many
     hours as is physically possible has meant that lawyers no longer take the time to
     sit down and communicate with their client about the fees involved or discuss
     the progress of the matter. The factory environment of the law firm reinforces




62
   Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper, November, 2004) at
para 3.6.
63
   Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper, November 2004) at
para 2.56.



                                                                                               32
     the ethos that time is money and one cannot waste time on tasks that cannot be
     billed.”64


2.76     The Panel concluded that,


     “It is important to consider whether the entrenching of time billing in the legal
     profession is leading to systemic breakdown in the solicitor-client relationship
     by virtue of the fact the structural assumptions on which time billing is built
     puts it in opposition to principles of good communication.”65


2.77     The Review Panel considered the appropriateness of hourly billing from the
         perspective of the quality and value of the work required to be done, noting
         that,


     “ Hourly billing penalises the efficient and productive lawyer who is able to
      complete a matter in less time than his lazy counterpart. Critics of hourly
      billing argue that the number of hours it takes to complete a task does not
      necessarily correlate to the value of that particular task to the client. As
      Professor Hornstein states: ‘One thousand plodding hours may be far less
      productive than one imaginative brilliant hour. A surgeon who skilfully
      performs an appendectomy in seven minutes is entitled to no smaller fee than
      one who takes an hour; many a patient would think he is entitled to more. The
      dubious value of the time factor as a standard for legal services has been
      recognized by many courts: The value of a lawyer’s services is not measured
      by time or labour merely…Another factor to be borne in mind is that when
      hours become a criterion, economy of time may cease to be a virtue.
      Inexperience, inefficiency, even incompetence will be rewarded. Expeditious
      termination of litigation will be discouraged           - to the great cost of all
      concerned’.”66



64
   Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper, November, 2004) at
para 3.20.
65
   Legal Fees Review Panel, “Lawyers Costs and Time Billing” (Discussion Paper, November 2004) at
para 2.57.
66
   Legal Fees Review Panel, “Lawyers costs and Time Billing” (Discussion Paper, November 2004) at
para 3.12, quoting, ‘Legal Therapeutics: The ‘Salvage’ Factor in Counsel Fee Awards 69 Harvard Law



                                                                                               33
2.78    In the United States, the American Bar Association has also criticised hourly
        billing on the following grounds, among others:-


       discourages taking on pro bono work

          does not encourage project or case planning

       provides no predictability of cost for client

       may not reflect value to the client

       penalizes the efficient and productive lawyer

       discourages communication between lawyer and client

       encourages skipping steps

       fails to discourage excessive layering and duplication of effort

          fails to promote a risk/benefit analysis

       does not reward the lawyer for productive use of technology

       puts client’s interests in conflict with lawyer’s interests

       client runs the risk of paying for:

             — the lawyer’s incompetency or inefficiency

             — associate training

             — associate turnover

             — padding of timesheets

          results in itemized bills that tend to report mechanical functions, not value of
        progress

       results in lawyers competing based on hourly rates.67



2.79    In England, the Supreme Court Costs Office introduced costs guides for use in
        summary assessments and in relation to proceedings in the Court of Appeal,


Review 658(1956) at p. 660 cited by George Russell Meurer, ‘Value Billing: A Valid Alternative to
Time Billing?’ 55(7) Texas Bar Journal 719(1992).
67
   ABA Commission Report on Billable Hours (2001-2002).



                                                                                                    34
         stated that, “Counsel’s fees depend upon the seniority of Counsel which it was
         reasonable to instruct and the market price for the item of work in question”.
         The Costs Office moreover notably stated that


     “It is not appropriate to specify an hourly rate for Counsel and to remunerate
     them at a multiple of that rate according to the number of hours reasonably
     spent. Such an approach would reward the indolent and penalise the
     expeditious.”68


2.80     Other jurisdictions have considered, and some have implemented, alternative
         means of quantifying costs, in place of time-based billing systems. Among the
         systems for determining legal costs which have found favour are so-called
         “event based billing” and “value billing”. The Australian Law Reform
         Commission (“ALRC”) made submissions to the New South Wales’ Legal
         Fees Review Panel in December 2004. The submissions of the ALRC
         included the submission that item and time based billing, as it operated in the
         federal courts of Australia at that time, “have been criticised as badly
         structured; creating uncertainty about the amount a successful litigant will
         recover; promoting litigation (rather than settling or controlling expenditure);
         and rewarding outmoded work practices”.69


2.81     The ALRC supported the criticisms in the Review Panel’s Discussion Paper of
         the system of hourly billing and encouraged “reforms that will place greater
         emphasis on value billing. Event-based fees would provide a greater certainty
         about costs for clients, and also enhance the development of practice
         techniques based on quality and efficiency rather than the time spent on a
         matter.”70


2.82     The Bar Council submits that a system for determining the appropriate level of
         recoverable legal costs, which is based on time expended, will be problematic

68
   Supreme Court Costs Office, Guide to the Summary Assessment of Costs (December 21, 2004) at
paras 69.
69
   Australian Law Reform Commission, Submissions to the New South Wales’ Legal Fees Review
Panel (December 2004) at para 4.
70
   Australian Law Reform Commission, Submissions to the New South Wales’ Legal Fees Review
Panel (December 2004) at para 9.



                                                                                                 35
       in the context of the practice of an Irish barrister. In addition to the problems
       with hourly billing which were identified in other jurisdictions and outlined
       above, there are additional features of the practice of an Irish barrister which,
       the Bar Council submits, render time-based billing inappropriate.


2.83   First, a barrister receives instructions from a solicitor and a client does not
       have direct control or influence over the precise instructions and pattern of
       events that are relevant to the barrister’s discharge of his tasks. Secondly, as
       the work of barrister is primarily contentious, there will be other parties,
       whose conduct will directly affect the number of hours which a barrister is
       obliged to spend on the matter. Therefore, by contrast with certain other areas
       of legal practice, litigation is highly unpredictable and the hours that a
       barrister must expend on a particular matter are often beyond the control of an
       individual litigant and his legal representatives. The fairness of penalising the
       litigant for the time that is spent on the matter, may be questioned.


2.84   Thirdly, a barrister does not typically charge for disbursements, such as
       photocopying, postage, telephone calls, research expenses, travel and
       accommodation expenses. However, if a time-based billing system is
       advocated, a barrister will have to recoup these expenses separately, which
       will in turn involve higher administration costs and ultimately, higher costs for
       clients.


2.85   Fourthly, many aspects of a barrister’s work are not presently charged to a
       client, such as appearances in court in lists to fix dates, call-overs, or for such
       matters as uncontested adjournments. However, if time-based billing is to be
       introduced, each of these events, among many others, will have to be
       separately recorded and invoiced. This will increase the administrative
       expense involved and will increase the costs to clients. Fifthly, a barrister may
       discharge tasks related to a number of different cases in the same forum, such
       as setting a number of cases down for hearing in a single list to fix dates. If
       this work is to be billed on the basis of time, it will be very difficult to divide
       up the costs between the various matters dealt with. Similarly, a barrister will
       often engage in important discussions with counterparts and with instructing



                                                                                         36
         solicitors in contexts that do not strictly relate to a particular client’s case. By
         way of example, a barrister and solicitor who are acting together for a number
         of different clients, would often discuss those various matters in the course of
         a single conversation. If each such discussion is to be become billable
         according to time spent, this will have an impact on the fees ultimately
         charged.


2.86     It is the Bar Council’s submission to the Implementation Advisory Group that
         the amount of time expended on a matter is one factor to be taken into account
         in assessing the appropriate level of legal costs, and is so reflected in the Code
         of Conduct of the Bar of Ireland, but that it should only be one of the factors to
         be weighed.71 The Bar Council submits that extreme caution should be
         exercised before introducing guidelines for the determination of recoverable
         legal costs, on the basis of the time spent on the matter in question. In other
         jurisdictions in which time-based billing has become the practice, this system
         of billing has received sustained and virulent criticism. Moreover, such a
         system of billing would be singularly unsuitable for assessing the work of a
         barrister, as explained above. Finally, the Bar Council reiterates, as stated by
         Professor Hornstein and quoted by the New South Wales Legal Fees Review
         Panel,


     “‘One thousand plodding hours may be far less productive than one imaginative
     brilliant hour. A surgeon who skilfully performs an appendectomy in seven
     minutes is entitled to no smaller fee than one who takes an hour; many a patient
     would think he is entitled to more. The dubious value of the time factor as a
     standard for legal services has been recognized by many courts: The value of a
     lawyer’s services is not measured by time or labour merely…Another factor to
     be borne in mind is that when hours become a criterion, economy of time may
     cease to be a virtue. Inexperience, inefficiency, even incompetence will be
     rewarded. Expeditious termination of litigation will be discouraged - to the
     great cost of all concerned’.”72


71
  Code of Conduct of the Bar of Ireland (March 13, 2006), Rule 12(1)(a). See further below.
72
  Legal Fees Review Panel, “Lawyers costs and Time Billing” (Discussion Paper, November 2004) at
para 3.12, quoting, ‘Legal Therapeutics: The ‘Salvage’ Factor in Counsel Fee Awards 69 Harvard Law



                                                                                               37
Submission 8


2.87    It is the Bar Council’s submission to the Implementation Advisory Group
        that the amount of time expended on a matter is one factor to be taken into
        account in assessing the appropriate level of legal costs, and is so reflected
        in the Code of Conduct of the Bar of Ireland, but that it should only be one
        of the factors to be weighed.73 The Bar Council submits that extreme
        caution should be exercised before introducing guidelines for the
        determination of recoverable legal costs, on the basis of the time spent on
        the matter in question.       In other jurisdictions in which time-based billing
        has become the practice, this system of billing has received sustained and
        virulent criticism. Moreover, such a system of billing would be singularly
        unsuitable for assessing the work of a barrister.


2.88    The Bar Council notes that there are certain formulations of the criterion of
        time spent in the Working Group’s Report which suggest an objective
        assessment of the time required should be conducted. The Bar Council
        considers that there are many issues regarding the allocation of judicial
        resources, the organisation of courts lists, delays in any litigation, among
        other matters, which make the objective quantification of time required for
        particular steps in proceedings extremely difficult, if not impossible.


2.89    The Bar Council notes the recommendations in Chapter Eight of the
        Working Group’s Report that are designed to reduce delays and increase
        the predictability of litigation.        These recommendations are welcomed.
        However, until such recommendations are implemented, and the delays and
        uncertainties of litigation are addressed, it is not realistic to attempt to
        assign objective timeframes to designed tasks.




Review 658(1956) at p. 660 cited by George Russell Meurer, ‘Value Billing: A Valid Alternative to
Time Billing?’ 55(7) Texas Bar Journal 719(1992).
73
   Code of Conduct of the Bar of Ireland (March 13, 2006), Rule 12(1)(a). See further below.



                                                                                                    38
Submission 9


2.90       The Bar Council submits that until the structural and procedural factors
           that inhibit the efficiency and predictability of the litigation process are
           addressed, and the recommendations of the Working Group towards this
           end are implemented, it is not realistic to attempt to assign objective
           timeframes to particular tasks and steps within the litigation process.


(iii)      Value of claim


2.91       The Working Group recommends that,


      “Consideration should be given, where the type of action renders this
      appropriate, to the value of the claim or counterclaim involved. The question as
      to how cognisance of the value of the case may be taken into account should
      also be considered. However, in no event should the level of recoverable costs
      be directly proportionate to the value of the case.”74


2.92       The Bar Council welcomes this recommendation and refers the
           Implementation Advisory Group to the following rule of the Code of Conduct
           for the Bar of Ireland: “Barristers may not accept instructions on condition
           that payment will be subsequently fixed as a percentage or other proportion of
           the amount awarded.”75


Submission 10


2.93       The Bar Council submission to the Advisory Implementation Group is that,
           while legal costs should not be fixed as a direct proportion of the value of a
           claim, the value of a case and its importance are factors that should be taken
           into account in determining a reasonable level of legal costs.




74
     Report of the Legal Costs Working Group (November 2005) at para 5.23.
75
     Code of Conduct for the Bar of Ireland (March 13, 2006), Rule 12.1(e).



                                                                                            39
(iv)     Other factors


2.94     The Bar Council has examined the approaches of a number of other
         jurisdictions in relation to the criteria that should be taken into account in
         assessing the appropriate level of legal costs.


2.95     The American Bar Association (“ABA”) Model Rules of Professional
         Conduct state that a reasonable fee should be assessed having regard to the
         following factors:


     “(1) the time and labor required, the novelty and difficulty of the questions
     involved, and the skill requisite to perform the legal service properly;

     (2) the likelihood, if apparent to the client, that the acceptance of the particular
     employment will preclude other employment by the lawyer;

     (3) the fee customarily charged in the locality for similar legal services;

     (4) the amount involved and the results obtained;

     (5) the time limitations imposed by the client or by the circumstances;

     (6) the nature and length of the professional relationship with the client;

     (7) the experience, reputation, and ability of the lawyer or lawyers performing
     the services; and

     (8) whether the fee is fixed or contingent.”76




2.96     The Australian Law Reform Commission conducted an extensive survey of
         other jurisdictions’ approaches to the issue of legal costs and concluded that
         legal professional rules should provide criteria for determining reasonable fees
         and that these criteria should use as a guide, the ABA’s Model Rules of




76
 American Bar Association, Center for Professional Responsibility, Model Rules of Professional
Conduct, Rule 1.5(a).



                                                                                                 40
         Professional Conduct.77 The Australian Law Reform Commission listed
         precisely the same factors as the ABA, as listed above.


2.97     The Standing Committee of Attorney Generals of Australia subsequently
         promulgated model provisions for the regulation of Australia’s legal
         profession.78 These included a provision that, on a review of legal costs, the
         following criteria, among others, could be taken into account in determining
         whether the costs were fair and reasonable:


     “…(d) any relevant costs agreement;

     (e) the skill, labour and responsibility displayed on the part of the Australian
     legal practitioner or Australian-registered foreign lawyer responsible for the
     matter;

     (f) the retainer and whether the work done was within the scope of the retainer;

     (g) the complexity, novelty or difficulty of the matter;

     (h) the quality of the work done;

     (i) the place where, and circumstances in which, the legal services were
     provided;

     (j) the time within which the work was required to be done;

     (k) any other relevant matter.”79




2.98     In New South Wales, the Legal Profession Act 2004, provides that the
         following factors may be considered in assessing legal costs:


                 “…(d) the skill, labour and responsibility displayed on the

           part of the Australian legal practitioner or Australian-


77
   See ALRC “Managing Justice: A Review of the Federal Civil Justice System” (ALRC 89, 2000) at
paras 4.48 to 4.50. The Law Reform Commission recommended that “these factors are not intended to
be exhaustive of prescriptive, but indicative of the matters to be taken into account” (para 4.49). The
Australian Government, in its Response to the ALRC supported this recommendation.
78
   Standing Committee of Attorneys-General, Model Provisions (August 7, 2003).
79
   Standing Committee of Attorneys-General, Model Provisions (August 7, 2003), section 1041.



                                                                                                    41
             registered foreign lawyer responsible for the matter,

             (e) the retainer and whether the work done was within the

             scope of the retainer,

             (f) the complexity, novelty or difficulty of the matter,

             (g) the quality of the work done,

             (h) the place where, and circumstances in which, the work

             was done,

             (i) the time within which the work was required to be done,

             (j) any other relevant matter.”80




2.99       The Rules of Professional Conduct which govern barristers and solicitors in
           New Zealand require that, “A practitioner shall charge a client no more than a
           fee which is fair and reasonable for the work done, having regard to the
           interests of both client and practitioner.”81


2.100 The Commentary which is attached to the Rules of Professional Conduct
           states that,


      “Charges must be fair and reasonable in all the circumstances. Practitioners are
      referred to the Society's Conveyancing Practice Guidelines. The ‘Principles of
      Charging’ set out in the guidelines include:

      Charges by a lawyer for professional work shall be calculated to give a fair and
      reasonable return for the services rendered, having regard to the interests of both
      client and lawyer. Charges shall take account of all relevant factors, including:

      (a) the skill, specialised knowledge, and responsibility required

      (b) the importance of the matter to the client and the results achieved

      (c) the urgency and circumstances in which the business is transacted


80
     Legal Profession Act 2004 (in force October 1, 2005), sections 328(7) and 363(2).
81
     Rules of Professional Conduct for Barristers and Solicitors (7 th Ed., 2006), Rule 3.01 (New Zealand).



                                                                                                        42
  (d) the value or amount of any property or money involved

  (e) the complexity of the matter and the difficulty or novelty of the questions
  involved

  (f) the number and importance of the documents prepared or perused

  (g) the time and labour expended

  (h) the reasonable costs of running a practice.

  The relative importance of the factors set out above will vary according to the
  particular circumstances of each transaction.”



2.101 In England, the Civil Procedure Rules provide that a court should take account
       of the following criteria in determining the appropriate legal costs:


  “(a) the conduct of all the parties…

  (b) the amount or value of any money or property involved;

  (c) the importance of the matter to all the parties;

  (d) the particular complexity of the matter or the difficulty or novelty of the
  questions raised;

  (e) the skill, effort, specialised knowledge and responsibility involved;

  (f) the time spent on the case; and

  (g) the place where and the circumstances in which work or any part of it was
  done.82




2.102 The General Council of the Bar in England has listed the following guidance
       to barrister in fixing fees:


  “ When a brief fee has not been agreed and is claimed by Counsel in a sum
  greater than the product of an hourly rate and the number of hours actually
  worked in preparation of the brief, this should be recorded in a note to be




                                                                                    43
     submitted with the fee note. Details in the supplementary note should include,
     but are not limited to:


             (i)             The seniority, reputation and relevant expertise of Counsel;

             (ii)            The complexity of the case;

             (iii)           The amount of preparation required in advance of the hearing;

             (iv)            Counsel’s commitment to a fixed hearing date, if any;

             (v)             The expected length of the case and, therefore, the time reserved
                            for it in Counsel’s diary;

             (vi)            The urgency of the matter when Counsel was briefed;

             (vii)           The amount of work required out of Court and in the preparation
                            of any kind of written submission during the hearing;

             (viii)          The importance of the case to the parties or any of them, or to
                            the public interest.”83



2.103 The Code of Conduct of the Bar of Northern Ireland84 provides as follows:


     “A barrister is entitled and obliged to mark a proper and reasonable fee in
     respect of each brief and item of work for which instructions have been
     accepted and the barrister is entitled to take into account when marking or
     nominating such fee all features of the instructions which bear upon the
     commitment which is thereby undertaken including:-


                     (i)        the complexity of the issues or subject matter.

                     (ii)       the length and venue of any trial or hearing.

                     (iii)      the amount or value of any claim or subject matter in issue.

                     (iv)       the time within which the work is required to be undertaken.

                     (v)        any other special feature of the case.”85

82
   Civil Procedure Rules, Rule 44.5(3).
83
   See Bar Council, “Guidance on Counsel’s Fee Notes” at www.barcouncil.org.uk.
84
   Code of Conduct of the Bar of Northern Ireland as adopted on March 6, 2003.



                                                                                                 44
2.104 In Ireland, the Solicitors’ Remuneration General Order 1960 provided
             guidance on the computation of instruction fees. Section 5 of that Order
             provides that an instruction fee shall be:


      “Such fee as may be fair and reasonable having regard to all the circumstances
      of the case, including:—


                             (a)      the complexity, importance, difficulty, rarity or
                                      urgency of the questions raised;

                             (b)      where money or property is involved, its amount or
                                      value;

                             (c)      the importance of the matter to the client;

                             (d)      the skill, labour, and responsibility involved therein
                                      and any specialised knowledge given or applied on
                                      the part of the solicitor;

                             (e)      the number and importance of any documents
                                      perused;

                             (f)      the place where and the circumstances in which the
                                      business or any part thereof is transacted; and

                             (g)      the time reasonably expended thereon.



2.105 In Crotty v. An Taoiseach,86 Barr J. considered the following factors to be
             relevant to the computation of legal costs (solicitors’ instruction fees in that
             instance):

       (a)      the magnitude of the case;

       (b)      the unique and complex nature of the case;

       (c)      the importance of the case;


85
     Code of Conduct of the Bar of Northern Ireland as adopted on March 6, 2003, section 31.11.
86
     [1987] I.L.R.M. 400; [1990] I.L.R.M. 617.



                                                                                                  45
       (d)      time spent on the case;

       (e)      the skill and experience of the solicitors;

       (f)      the speed of the work done;

       (g)      the pressure exerted on the solicitor;

       (h)      the nature and volume of documentation involved;

       (i)      assistance from the client and/or counsel.




2.106 The Code of Conduct for the Bar of Ireland87 provides as follows:


      “Barristers’ fees are based upon work done. Barristers are entitled to charge for
      any work undertaken or to be undertaken by them (whether or not it involves an
      appearance in court) on any basis or by any method they think fit, provided that
      such basis or method is permitted by law and a barrister is entitled to take into
      account when marking or nominating such fee, all features of the instructions
      which bear upon the commitment which is thereby undertaken or has been
      undertaken by them including:

      -the complexity of the issue or subject matter;

      -the length and venue of any trial or hearing;

      -The amount or value of any claim or subject matter in issue provided, however,
      that the level of fee should not be calculated solely on the basis of the value of
      the case or on a basis directly proportionate to the value of the case;

      -the time within which the work is or was required to be undertaken;

      -any other special feature of the case.”88



2.107 From a review of the criteria used for determining the reasonableness and
             appropriateness of legal costs in the jurisdictions surveyed above, there are a
             number of recurring factors. These include the following:


87
     Code of the Conduct for the Bar of Ireland, adopted March 13, 2006.
88
     Code of the Conduct for the Bar of Ireland, adopted March 13, 2006, Rule 12.1(a).



                                                                                           46
      The time spent on the matter;

      The labour and effort involved;

      The skill, responsibility, and specialised knowledge involved;

      The complexity, novelty or difficulty of the issues;

      The value of the claim or subject matter;

      The importance of the case to the client or in the public interest;

      The quality of the work done;

      The place and circumstances in which the work is done;

      Any time limitations imposed on the lawyers by the client or the
       circumstances;

      The seniority, experience, reputation and ability of the lawyer.




2.108 The Bar Council considers that each of these factors is relevant and important
       in assessing the appropriate level of legal costs. The Bar Council is concerned
       that, if all of the relevant considerations are not taken into account in setting
       guidelines for recovery of legal costs, the guidelines will neither accurately
       reflect the appropriate level of legal costs nor allow accommodation of the
       various matters which can affect the cost of legal proceedings.


2.109 The Bar Council considers that the recommendation at paragraph 2.3 of the
       Working Group’s Report that the proposed guidelines should encompass such
       elements as the appropriate hours expended, the complexity of the proceedings
       and the level of the court, is too limited. While it is clear that this list is not
       exhaustive, the Bar Council is aware of no reason for curtailing the list of
       factors that have hitherto been taken into account in Ireland, as well as in
       many other comparable jurisdictions, in determining the appropriate level of
       legal costs.




                                                                                             47
Submission 11


2.110 It is the Bar Council’s submission to the Implementation Advisory Group that
           the factors that should be taken into account in setting (or applying)
           guidelines for recoverable legal costs should encompass, or at least allow
           accommodation of, the following:

          The time spent on the matter;

          The labour and effort involved;

          The skill, responsibility, and specialised knowledge involved;

          The complexity, novelty or difficulty of the issues;

          The value of the claim or subject matter;

          The importance of the case to the client or in the public interest;

          The quality of the work done;

          The place and circumstances in which the work is done;

          Any time limitations imposed on the lawyers by the client or the
           circumstances; and

          The seniority, experience, reputation and ability of the lawyer.



(v)        Updating guidelines


2.111 The Working Group recommends that the proposed guidelines should be
           regularly updated.89 The Bar Council considers this recommendation to be of
           the utmost importance. The failure to update the terms of Appendix W was
           identified by the Working Group as having “serious adverse consequences…
           on the system of costs recovery”.90 In other jurisdictions, such as New South
           Wales and New Zealand, a failure to adequately amend and update scales of
           costs was similarly the subject of significant criticism. The Bar Council is
           mindful of the fact that the amendment of any guidelines regarding costs is

89
     Report of the Legal Costs Working Group (November 2005) at para 7.17.
90
     Report of the Legal Costs Working Group (November 2005) at para 2.20.



                                                                                          48
       necessary not just to ensure that the amounts are in keeping with market rates,
       but also to ensure that the guidelines are not treated as base costs, thereby
       encouraging higher costs than those which would otherwise be levied. The
       latter danger was identified and materialised, to some extent, in New South
       Wales, prior to the deregulation of costs in that jurisdiction. On the other
       hand, lawyers in New Zealand have been heavily critical of the level of
       recoverable costs, which has been described as “derisory” in some instances.


2.112 The Bar Council submits that the timeframes within which the guidelines
       should be updated must be flexible to take account of changes in rules,
       procedures and law, as well as economic factors, which may affect the
       appropriate level of costs’ guidelines. The Bar Council notes that in New
       Zealand and in England, the scales of costs, and the cost guidance,
       respectively, are regularly updated and amended. The Bar Council also notes
       that any amendments to the suggested or scaled costs are made in consultation
       with, and on the basis of information received from, the legal professions.


2.113 The Bar Council submits that the Implementation Advisory Group should
       ensure that the proposed guidelines are updated periodically, and that there is
       adequate flexibility and resources to ensure that the guidelines may be
       changed more regularly, to reflect any changes that affect the level of legal
       costs, such as changes in court rules, procedures, laws or other factors.


Submission 12


2.114 The Bar Council submits that any amendment to the proposed guidelines must
       be preceded by a process of consultation with the Council of the Bar of
       Ireland and the Law Society of Ireland and must involve the input and
       participation of both the Bar and the Law Society.




                                                                                       49
CHAPTER THREE                                 LITIGATION REFORM



A.       Delay

3.01     The Working Group has identified delays in litigation as one of the factors that
         increases the scale of legal costs in Ireland. The Working Group’s Report
         therefore contains a number of recommendations that are designed to reduce
         such delay. These include the following recommendations:


        The more vigilant enforcement of existing time limits;91


        Imposition of sanctions for delay in proceedings;92


        Restraining the level of adjournments;93


        Increasing the use of peremptory adjournments;


        The introduction of a rule of interpretation which requires courts “to allot to
         individual cases an appropriate share of the court’s resources, while
         considering the needs of other cases… the rights of access of individual
         litigants to justice must, in reality, be reconciled with the rights of access of
         parties to other cases;”94




91
   Report of the Legal Costs Working Group (November 2005) at para 8.4 (the Working Group
commented that, “time limits in practice are often ignored as there is not any realistic likelihood that
the delaying party will suffer any penalty for his or her delay.”)
92
   Report of the Legal Costs Working Group (November 2005) at paras 8.10 (referring to Order 33,
Rule 33 and noting that, “this provision does not appear to have been relied upon in recent times, if in
fact it ever has been.”) and 8.12 and 8.40 (regarding costs penalties on solicitors).
93
   Report of the Legal Costs Working Group (November 2005) at para 8.25.
94
   Report of the Legal Costs Working Group (November 2005) at para 8.32.



                                                                                                       50
        The introduction of rules of court facilitating the supervision of the pace of
         litigation and sanctioning delay;95


        Encouraging more just, expeditious, and less costly, disposal of cases;96 and


        Increased use of “unless orders” in respect of court directions.97


3.02     The Bar Council has no specific submissions to make in relation to these
         recommendations. The Bar Council, in its submissions to the Working Group,
         emphasised certain inefficiencies that exist in the procedures currently
         prevailing before the Irish courts and welcomes any amendments which may
         make the system more efficient and more expeditious.


3.03     In this regard, the only reservation which the Bar Council wishes to express to
         the Implementation Advisory Group is that certain procedural changes will
         increase the steps required, the time pressures and therefore, the costs of
         litigation. By way of example, as noted in the submissions to the Working
         Group, while the Rules of the Commercial Court do reduce delay in
         proceedings, they also place very considerable pressures on barristers and
         frequently inhibit counsel’s ability to undertake and discharge other legal
         work. The Bar Council submits that the Implementation Advisory Group
         should be mindful of the practical, and cost, implications of imposing extra
         burdens and compliance requirements on practitioners.


Submission 13


3.04     The Bar Council welcomes any recommendations that have the objective of
         making court systems and procedures more efficient and expeditious.
         However, the Bar Council also submits that the Implementation Advisory
         Group should be mindful of the practical, and cost, implications of imposing
         extra burdens and compliance requirements on practitioners.



95
   Report of the Legal Costs Working Group (November 2005) at para 8.33.
96
   Report of the Legal Costs Working Group (November 2005) at para 8.22.
97
   Report of the Legal Costs Working Group (November 2005) at para 8.34.



                                                                                          51
B.      Pre-trial costs
3.05    The Working Group examined the rules and practice governing the award of
        costs for interlocutory applications. In this regard, the Group noted that courts
        rarely fix the costs of interlocutory applications and that, “a party who have
        succeeded on a pre-trial application necessitated by a default on the part of the
        other party may ultimately fail to recover the costs of that application in the
        event that the defaulting party succeeds on the main issue at trial.”98


3.06    The Working Group has therefore recommended that the procedure in the
        Commercial Court for determining the liability for the costs of pre-trial
        applications should be extended to all proceedings. The Working Group
        recommends that the costs of pre-trial motions should be awarded to the
        successful party.99 The Bar Council notes that this recommendation is
        consistent with the following submission of the Bar Council to the Working
        Group: “costs orders at interlocutory or motion stage should not be reserved
        but should be awarded and payable by the party in default”.100


C.      Estimates of costs
3.07    The Working Group recommends that the court should be empowered to
        require parties to produce and exchange estimates of costs incurred at any
        stage of the proceedings.101 A similar requirement has been introduced in
        England, but only in relation to cases on the “multi-track”. The Bar Council
        submits that a careful analysis of comparable jurisdictions and the effect of the
        requirement to produce costs’ estimates in such jurisdictions, should be
        conducted, before introducing such a requirement in this jurisdiction.




98
   Report of the Legal Costs Working Group (November 2005) at para 8.17.
99
   Report of the Legal Costs Working Group (November 2005) at para 8.37
100
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 13.1(w).
101
    Report of the Legal Costs Working Group (November 2005) at para 8.41.



                                                                                                     52
D.      Jurisdictional limits
3.08    The Working Group recommends that “the jurisdictional limits of the courts
        be progressively increased and adjusted regularly thereafter, save for personal
        injuries cases where the status quo should be maintained for a further period
        until a more complete understanding of the dynamics of the Government’s
        insurance reform programme is available.”102 The Working Group also
        recommends that “consideration should be given to a substantial increase in
        the jurisdictional limit of the Small Claims Procedure and that the range of
        cases dealt with by means of this procedure should be expanded.”103


E.      Mediation
3.09    The Working Group’s Report recommends that the use of mediation should be
        encouraged but that the “capacity to enforce mediation may be open to
        doubt.”104 The Working Group noted that, “The question of how mediation
        can be introduced more widely into the Irish system deserves thought and
        discussion, especially in the courts of lower jurisdiction given the tendency of
        costs to become disproportionate there.”105


3.10    This position is entirely consistent with the submission made by the Bar
        Council to the Working Group that “mediation is probably only appropriate
        where both of the parties are receptive to it. Enforced mediation will simply
        add another layer of costs to the legal process. Enforced mediation would also
        be contrary to the spirit and underlying rationale of mediation.”106


F.      Civil legal aid
3.11    The Working Group notes in its Report that a departure from the principle that
        “costs follow the event” would undermine the “no foal no fee” system and




102
    Report of the Legal Costs Working Group (November 2005) at para 5.41.
103
    Report of the Legal Costs Working Group (November 2005) at para 5.43.
104
    Report of the Legal Costs Working Group (November 2005) at para 5.35.
105
    Report of the Legal Costs Working Group (November 2005) at para 5.37.
106
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 13.1(u).



                                                                                                     53
          would result in “pressure for the introduction of a better resourced system of
          civil legal aid.”107


3.12      The Working Group also comments,


      “The Group is of the view that the Government might give further consideration
      to the operation of the free legal aid system to ensure that those without
      adequate means are not effectively excluded from using the civil legal system to
      vindicate their rights. The Group was strongly of the view that the ‘no foal, no
      fee’ system may not adequately address the need for legal services across the
      spectrum of issues requiring resolution in the courts.”108


3.13      The Bar Council, in its submissions to the Working Group, suggested that,


      “the Legal Aid System should be expanded properly and comprehensively. As
      an interim measure pending that development, the Attorney General’s Scheme
      should be revamped and should be properly resourced. While there have been
      improvements in terms of the backlog and size of barristers’ fees, it remains a
      fact that fees recoverable under the Attorney General Scheme are inadequate
      and take too long to arrive; the Legal Aid System should be expanded properly
      and comprehensively. As an interim measure pending that development, the
      Attorney General’s Scheme should be revamped and should be properly
      resourced.”109


Submission 14


3.14      The Bar Council welcomes the Working Group’s call for an improved system
          of civil legal aid across the spectrum of issues which require resolution in the
          courts.




107
    Report of the Legal Costs Working Group (November 2005) at para 5.16.
108
    Report of the Legal Costs Working Group (November 2005) at para 5.51.
109
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 13.1(x).



                                                                                                     54
G.         Court fees
3.15       The Working Group considered the issue of court fees and the possibility of
           charging for court time.110 In this regard, the Bar Council wishes to draw the
           attention of the Implementation Advisory Group to the importance of the
           constitutional right of access to justice and submits that any system of fees that
           proposes to impede this right must be very carefully and thoroughly
           considered. The Bar Council would welcome the opportunity to make
           submissions in the event of the formulation of any proposal to charge litigants
           for court time or to introduce similar levels of court fees.


H.          Court reform
3.16       The Bar Council considers that there are a number of inefficiencies in the
           present court system. The Bar Council wishes to repeat and emphasise the
           following submissions, which are designed to enhance expedition and
           efficiency in the court system. The Bar Council is of the view that such
           changes are necessary before any predictable and fair system of legal costs can
           be devised.


                    “(a)    in the first place, it is clearly essential that additional judges
                            should be appointed. The State of Ontario in Canada has a
                            population similar to Ireland. It has a similar legal system (a
                            common law system). However, in that State, there are 64
                            High Court judges. That is approximately double the number
                            of High Court judges in Ireland. The Bar Council believes that
                            the number of High Court judges should be doubled.            An
                            increase in the number of judges is the only way in which
                            wasted costs of the type discussed above can be eradicated.
                            There need to be enough judges available to hear cases;


                    (b)     the Bar Council makes a similar recommendation in relation to
                            Circuit Court judges. There are significant delays in country
                            circuits. In country areas, circuit judges often have to sit very

110
      Report of the Legal Costs Working Group (November 2005) at para 5.52.



                                                                                           55
                          late at night to get through their lists. In such circumstances,
                          judges are understandably driven to urging parties and their
                          counsel to confine the evidence as much as possible. However,
                          this can lead to a perception by clients that they have not got a
                          full and fair hearing. In order to provide a fully comprehensive
                          Circuit Court system, the Bar Council believes that the number
                          of Circuit judges should be doubled;


                 (c)      the listing system needs to be substantially overhauled. There
                          is no reason why the allocation of dates should require the
                          attendance of large numbers of solicitor and counsel or why it
                          should occupy so much court time. The listing of cases could
                          surely be undertaken in the relevant court offices;


                 (d)      furthermore, not more than one case should be listed before any
                          judge for hearing on any day (unless it is known in advance
                          that the cases are sufficiently short to enable all cases listed
                          before a practitioner judge can be dealt with by that judge).
                          However, this system would only work in the even that there
                          are sufficient numbers of judges to deal with the number of
                          cases requiring hearings.        That is why it is so essential to
                          appoint a significant number of additional judges.”111


Submission 15


3.17    The Bar Council submits to the Implementation Advisory Group that certain
        changes to the manner in which judicial resources are allocated and cases are
        handled and listed before the courts, are essential before any predictability of
        costs can be guaranteed and before a comprehensive and workable system of
        guidelines for costs can be introduced.




111
   Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 8.9.



                                                                                                    56
CHAPTER FOUR                      INFORMATION


4.01    The Working Group’s Report emphasises the importance of ensuring that
        clients get complete and up-to-date information regarding the cost
        implications of their cases.112 The Bar Council concurs entirely with this
        objective.


4.02    The Working Group makes detailed recommendations for the introduction of a
        revised and expanded client engagement letter, and for the imposition of
        effective sanctions for failing to furnish such a letter.113 The responsibility for
        furnishing the proposed client engagement letter, as well as the letter currently
        required by section 68 of the Solicitors’ (Amendment) Act 1994, lies primarily
        on the client’s solicitor.


4.03    With regard to barristers, the Working Group did state that it welcomed the
        fact that, “increasingly, solicitors ‘shop around’ in relation to engaging
        barristers on behalf of their clients. The Group welcomes this development
        and sees merit in solicitors obtaining quotations, where appropriate, from
        barristers and other professionals before engaging them.”114


4.04    This recommendation is consistent with the Bar Council’s submissions to the
        Working Group, in which it stated, “before retaining counsel, clients and
        solicitors should be encouraged to approach a number of barristers to provide
        a quotation before deciding which barrister to retain for any particular
        purpose.”115


4.05    The Bar Council also refers to Rule 12.6 of the Code of Conduct for the Bar of
        Ireland.




112
    Report of the Legal Costs Working Group (November 2005) at paras 6.11 – 6.15.
113
    Report of the Legal Costs Working Group (November 2005) at para 6.11.
114
    Report of the Legal Costs Working Group (November 2005) at para 5.33.



                                                                                         57
“On the taking of instructions to provide legal services, or as soon as practicable
thereafter, a barrister shall on request, provide to an instructing solicitor, or the client
in the case of access under the Direct Professional Access Scheme, with particulars in
writing confirming:-


          (a)      the actual charges, or


          (b)      where the provision of particulars of the actual charges is not in the
                   circumstances possible or practicable, an estimate (as near as may be)
                   of the charges, or


          (c)      where the provision of particulars of the actual charges or an estimate
                   of such charges is not in the circumstances possible or practicable, the
                   basis on which the charges are to be made.”116


4.06      The Bar Council notes that litigation is an area of practice in which it is often
          difficult to predict costs with accuracy. There are many variables, which can
          affect the conduct of the litigation, and the work, time and effort required.
          The Competition Authority acknowledged this fact in its “Study of
          Competition in Legal Services” as follows:


      “For contentious matters, it may not always be possible for a barrister to
      provide an exact fixed figure in advance. However, he should be able to give
      some indication of an hourly rate and the amount of work the case might
      involve. A client should know what a barrister is likely to charge before a
      solicitor briefs that barrister on the client’s behalf.”117


4.07      It is important to draw particular attention to the concession in the Working
          Group’s Report, that in particular cases, it may not be possible for barristers to
          furnish quotations. The Working Group cites, as an example of a case in


115
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 13.1 (a).
116
    Code of Conduct for the Bar of Ireland (March 13, 2006), Rule 12.12.
117
   Report of the Competition Authority “Study of Competition in Legal Services”
(Preliminary report, Feb 24, 2005) at para 12.2.


                                                                                                     58
         which such quotations may not be possible, cases where a barrister with a
         highly specialised expertise is required.118


4.08     The Working Group also acknowledges that, “given the nature of legal work
         in the area of contentious business, some degree of uncertainty as to the
         precise amount which will ultimately be chargeable in respect of a legal
         dispute is inevitable.”119


4.09     A final point regarding the provision of information on legal costs, is that
         barristers generally furnish any such information to solicitors, rather than to
         clients directly (with the exception of clients being represented under the
         Direct Professional Access Scheme). In other jurisdictions in which there is
         detailed regulation of the disclosure of costs to clients, such as New South
         Wales, the general approach is that the barrister must furnish the information
         to the solicitors, and the solicitors may then incorporate this information into
         the costs disclosure which is made to the client. The Bar Council considers
         that it is important that this fact be reflected in the formulation of any costs
         disclosure obligations. In particular, the Bar Council considers that it is
         important that the fact that barristers do not exercise direct control over, and
         responsibility for, the provision of information regarding costs to clients,
         should be reflected in any rules governing the disclosure of legal costs.120


Submission 16


4.10     The Bar Council submission to the Implementation Advisory Group is that,
         while the Bar Council is fully aware of the importance of the provision of
         information regarding legal costs to clients, and the role of barristers in that
         regard, the formulation of any rules governing such information should reflect
         the fact that it is often difficult for a barrister to provide an exact estimate of
         legal costs and that such information will generally be furnished to a solicitor,
         rather than to the client directly.

118
    Report of the Legal Costs Working Group (November 2005) at para 5.33.
119
    Report of the Legal Costs Working Group (November 2005) at para 7.6.
120
    See further Chapter Eight below, where detailed proposals regarding the disclosure of costs by
barristers are advanced.



                                                                                                     59
CHAPTER FIVE                              COUNSEL FEES


5.01    The Report of the Legal Costs Working Group contains certain specific
        recommendations regarding counsel’s fees. These recommendations may be
        summarised as follows. First, the Working Group recommends that there is no
        justification for a rule that a junior counsel should receive two thirds of the fee
        that is paid to a senior counsel. Secondly, the Working Group recommends
        that the number of counsel retained should be flexible and that there should be
        no requirement to retain both junior and senior counsel for cases in the High
        Court.


5.02    Thirdly, the Working Group recommends that brief fees should be broken
        down into more detailed components in accordance with the proposed
        guidelines. Fourthly, the Working Group recommends that barristers should
        only be remunerated for work actually and appropriately done. Finally, the
        Working Group makes certain recommendations for the formulation of
        guidelines and the factors which should be taken into account, which do not
        include the grade or seniority of the legal practitioner. The latter
        recommendations were addressed in Chapter Two of these submissions above.


A.      Proportion of costs between junior and senior counsel
5.03    The Working Group states in its Report that “it is established practice that
        Junior Counsel will, in the vast majority of cases, charge two-thirds of the fee
        marked by Senior Counsel on a case.”121 The Working Group further states
        that, “No justifiable rationale for this practice appears to exist”122 and that it is
        “unacceptable and unfair given its arbitrary nature.”123




121
    Report of the Legal Costs Working Group (November 2005) at para 3.19.
122
    Report of the Legal Costs Working Group (Novemeber 2005) at para 3.19.
123
    Report of the Legal Costs Working Group (Novemeber 2005) at para 2.7.




                                                                                           60
5.04       The Working Group notes that, “its recommendations for a system of
           recoverable cost guidelines on the basis of work done will address the cost
           implications arising from the present grading structure. For example,… in
           circumstances where the Junior Counsel carries out most of the work in a case
           where a Senior is also engaged, the Junior could recover higher fees than the
           Senior.”124


5.05       The Bar Council, in its previous submissions to the Working Group, set out in
           detail the work of a barrister in different areas of practice and the tasks,
           responsibilities and functions for which a client may incur barristers’ fees.
           The Bar Council wholly agrees with the recommendations of the Working
           Group that barristers should be remunerated for all work done. In this regard,
           the Bar Council refers to Rule 12.1(a) of the Code of Conduct for the Bar of
           Ireland, which provides as follows:


      “Barristers’ fees are based upon work done. Barristers are entitled to charge for
      any work undertaken or to be undertaken by them (whether or not it involves an
      appearance in court) on any basis or by any method they think fit, provided that
      such basis or method is permitted by law and a barrister is entitled to take into
      account when marking or nominating such fee, all features of the instructions
      which bear upon the commitment which is thereby undertaken or has been
      undertaken by them including:

      -the complexity of the issue or subject matter;

      -the length and venue of any trial or hearing;

      -The amount or value of any claim or subject matter in issue provided, however,
      that the level of fee should not be calculated solely on the basis of the value of
      the case or on a basis directly proportionate to the value of the case;

      -the time within which the work is or was required to be undertaken;

      -any other special feature of the case.”125




124
      Report of the Legal Costs Working Group (November 2005) at para 5.29.
125
      Code of the Conduct for the Bar of Ireland, adopted March 13, 2006, Rule 12.1(a).



                                                                                           61
B.      Number of counsel

5.06    The Working Group states in its Report that “a Senior Counsel does not
        usually appear in a High Court case without a Junior Counsel. A client, in
        engaging, through their solicitor, the services of a counsel of one level to
        conduct proceedings, may in practice also be required to engage a counsel of
        the other level.”126


5.07    The Working Group further expresses its concern “that practice and
        precedence determine in many cases the number and type of counsel required
        rather than the work required to be done.”127 Among the Working Group’s
        recommendations in this regard is the following: “a well experienced and
        expert Junior might be employed for a full High Court action and recover the
        fee that a Senior would traditionally have expected.”128


5.08    The Bar Council refers to Rule 11.3 of the Code of Conduct for the Bar of
        Ireland, which provides,


“Clients are never required to retain the services of a Senior Counsel. It is for the
instructing solicitor to decide whether it is necessary or desirable in the interests of his
or her client to brief Senior Counsel and to decide the number of Counsel to be
retained in a case.”129


Submission 17


5.09    The Bar Council submission to the Implementation Advisory Group is that
        there is never a requirement that a client must retain the services of a senior
        counsel. It is a matter for an instructing solicitor, and the client, to determine
        whether to instruct a senior counsel in a matter, and the number of counsel to
        instruct in any matter.



126
    Report of the Legal Costs Working Group (November 2005) at para 5.28.
127
    Report of the Legal Costs Working Group (November 2005) at para 5.31.
128
    Report of the Legal Costs Working Group (November 2005) at para 5.29.
129
    Code of the Conduct for the Bar of Ireland, adopted March 13, 2006, Rule 11.3.




                                                                                          62
C.         Brief fees

5.10       The Working Group recommends that counsel’s brief fee “be abandoned and
           be replaced by the guidelines on recoverable costs, deconstructing the fee into
           a set of charges for work actually and appropriately done in respect of steps
           within a case’s progression.”130


5.11       The Bar Council refers to the inconsistencies and ambiguities in the
           description and effect of the proposed “guidelines”, which were considered in
           detail in Chapter Two of these Submissions. The recommendation for the
           replacement of a brief fee with “guidelines… deconstructing the fee into a set
           of charges for work actually and appropriately done in respect of steps within
           a case’s progression” is a further variation on the formulation of the proposed
           guidelines.


5.12       The Bar Council refers to alternative formulations of the proposed guidelines
           in the Working Group’s Report based on an objective quantification of the
           time required, such as the proposal that the guidelines would “set ranges for
           the maximum number of hours which may be normally recoverable as party
           and party costs for particular types of proceedings or steps within
           proceedings.”131


5.13       The Bar Council also refers to the analysis conducted in Chapter Two of these
           Submissions of the shortcomings and difficulties of any time-based billing
           system, particularly in the context of the practice of a barrister. The Bar
           Council further refers to the authorities cited in Chapter Two which favour so-
           called “event based billing” rather than “time-based billing”.


5.14       In its submissions to the Working Group, the Bar Council described a
           barrister’s brief fee as follows: “Although a brief fee is charged as of the first
           day of the hearing, it is not designed to remunerate the barristers solely for the
           work done by them on that day. It is more particularly designed to remunerate


130
      Report of the Legal Costs Working Group (November 2005) at para 5.32.
131
      Report of the Legal Costs Working Group (November 2005) at para 7.17.



                                                                                            63
        barristers for all of their preparation for the hearing (including their legal
        research, their review of all of the papers, the preparation of their strategy for
        the examination of witnesses and cross-examination of witnesses, and other
        work done by the in the preceding months or years in preparation for the
        trial.)”132


5.15    A brief fee may therefore be regarded as an example of “event-based” billing,
        which is measured according to the work done, rather than strictly according
        to the time spent.


5.16    In England, the introduction of guides for legal fees, included guideline
        figures for the summary assessment of brief fees for “fast track” cases in the
        Court of Appeal. The guides issued by the Supreme Court Costs Office
        further allowed a degree of flexibility in relation to the guides furnished, to
        accommodate the relative experience and expertise of the particular barrister.


5.17    The Bar Council submission to the Implementation Advisory Group is that
        brief fees are a means of charging legal fees for work done in preparation for a
        trial and at the first day of hearing, which encompass the various factors that
        are relevant to determining a reasonable fee, such as the time spent, the
        complexity, novelty or difficulty of the matter, the expertise of the
        practitioner, the time within which the work was required to be done, among
        the other factors listed at Chapter Two above.


5.18    The Bar Council submits that a barrister’s brief fee is not the same as a
        solicitor’s instruction fee and that brief fees have not been subject to the
        difficulties and criticisms to which instructions fees have been subject. A
        brief fee is a form of “event-based” billing and is a more efficient and
        beneficial means of quantifying a barrister’s work in preparation for, and at
        the first day of hearing of, a trial, than a system based on time assessment.




132
   Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 2.6.



                                                                                                    64
Submission 18


5.19     The Bar Council submits that, in the interests of transparency, consideration
         could be given to including a requirement in practice ruling to be issued by
         the Professional Practices Committee of the Bar of Ireland that, in marking a
         brief fee, a barrister should identify and enumerate the work undertaken in
         preparation for the hearing of the matter, such as the legal research
         conducted, the procedural matters considered, all papers that were reviewed,
         discovery and background material that were examined and considered, the
         preparation of strategies, the planning of witness examinations, the outlining
         and drafting of legal submissions and factual background documents, and
         other such work done by the in the preceding months or years in preparation
         for the trial.


D.       Work actually done
5.19     The Working Group recommends that legal costs should only be incurred for
         work actually and appropriately done. This is consistent with the Code of
         Conduct for the Bar of Ireland, which provides in Rule 12.1(a) that
         “Barristers’ fees are based upon work done.”


5.20     There is one qualification to this, which is reflected in Rule 12.2 of the Code
         of Conduct for the Bar of Ireland as follows:


     “In cases where barristers have actually been briefed for the hearing then such
     barrister shall, in the event of a settlement resulting from negotiations, be
     entitled to charge a brief fee.”


5.21     This rule reflects the fact that, if a barrister is briefed for the hearing of a
         matter, he will typically undertake all necessary research, analysis and other
         preparation, before any settlement is reached. In most cases, the barrister will
         therefore have done most of the work to which the brief fee relates, before
         settlement. In these circumstances, it is entirely appropriate and just that legal
         fees be charged for the research and other preparatory work which a barrister
         has actually and appropriately undertaken in anticipation of the hearing.


                                                                                            65
5.22      Upon being briefed for the hearing of a matter, a barrister will moreover set
          aside the time to attend to the hearing of the matter, turning down alternative
          work, if necessary. It is therefore appropriate that a barrister be remunerated
          for this time.


5.23      Cancellation fees are a feature of many walks of life and cancellation fees for
          barristers have been considered in other jurisdictions. In New South Wales,
          the Legal Fees Review Panel stated that, “Some barristers charge a
          cancellation fee when a matter settles prior to or during the trial in which the
          barrister is briefed to appear.”133 The Panel did not recommend the abolition
          of such fees, but rather recommended that,


      “Guidelines whereby the interests of barristers, who have perhaps refused other
      briefs in the reasonable expectation that they will be occupied for the entire
      period set down for hearing, are balanced against the interests of clients, who
      reasonably expect to pay for work performed, could be developed.”134


Submission 19


5.24      The Bar Council submission to the Advisory Implementation Group is that,
          when a barrister has been briefed and prepared for the hearing of a matter
          which settles before the commencement of the hearing, the barrister is entitled
          to remuneration for all of the preparatory work that was actually and
          appropriately done and for the time which was dedicated to represent the
          client at that hearing.




133
    New South Wales’ Legal Fees Review Panel, “Lawyers Costs and Time Billing” (November 2004)
at para 2.37.
134
    New South Wales’ Legal Fees Review Panel, “Lawyers Costs and Time Billing” (November 2004)
at para 2.37.



                                                                                            66
CHAPTER SIX                        ASSESSMENT OF COSTS


6.01    In its submissions to the Working Group, the Bar Council highlighted a
        number of difficulties with the system of taxation of costs as it exists at
        present. First, the Bar Council indicated that “the current system of taxation is
        quite convoluted and often cumbersome”135. Second, the Bar Council noted
        that the system of taxation can be costly and that the court fees constitute a
        “very significant additional burden” on a party seeking taxation.136 Third, the
        Bar Council referred to the fact that no simple procedure exists for the
        resolution of disputes regarding individual items in a bill of costs.137


6.02    Fourth, the Bar Council suggested that an oral hearing is not necessary for
        every case in which costs are referred to taxation. Fifth, the Bar Council drew
        attention to the anomaly that an objection to the decision of a taxing master is
        heard by the same taxing master. Sixth, the Bar Council criticised the fact that
        there are too few taxing masters. Finally, the Bar Council noted that the
        process of taxation of costs is too lengthy and time-consuming.138


6.03    The Bar Council made certain submissions to the Working Group regarding
        the system of taxation of costs, including that more taxing masters should be
        appointed; alternatively, that there should be a single costs assessment body;
        that there should be periodic review of the rules governing taxation; that the
        process of taxation should be simplified; that taxing masters should not review
        their own decisions; that there should be a simplified procedure where a small




135
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 4.5.
136
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 4.7.
137
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 4.7.
138
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
para 4.7.



                                                                                                     67
          number of items are in dispute; and that oral hearings are not necessary in
          every case.139


6.04      Working Group’s Report adopts many of these submissions. In particular, the
          Working Group recommends the following:


         The establishment of a legal costs assessment group;140

         Assessments by way of written procedures;141

         A more simple and transparent system for assessment of costs;142

         Only the items in dispute should be assessed;143

         Reduction of the fees associated with taxation;144 and

         The appointment of an appeals adjudicator to conduct assessment appeals.145


6.05      The Working Group also notes that,


      “No express set of taxation policies or guidelines exists to indicate how the
      criteria mentioned earlier as governing the exercise of discretion by the Taxing
      Master (e.g. complexity, skill required, importance of case to client, value of
      claim, etc.) should be applied for particular types of action or application. The
      absence of such guidance hampers solicitors in advising clients on the extent of
      their likely exposure to costs and renders the process of predicting or settling
      costs as an alternative to taxation more difficult. These disadvantages outweigh
      any benefit which the current very flexible approach to exercise of judgment
      may confer in an individual case.”146




139
    Council of the Bar of Ireland, Submissions to the Legal Costs Working Group (February 2005) at
paras 13.1 (h), 13.1(i), 13.1(j), 13.1(k).
140
    Report of the Legal Costs Working Group (November 2005) at paras 2.15 and 7.16.
141
    Report of the Legal Costs Working Group (November 2005) at para 2.15 and 7.16.
142
    Report of the Legal Costs Working Group (November 2005) at para 2.15.
143
    Report of the Legal Costs Working Group (November 2005) at para 2.16 and 7.21 – 7.24.
144
    Report of the Legal Costs Working Group (November 2005) at para 2.17 and 7.25.
145
    Report of the Legal Costs Working Group (November 2005) at para 2.23.
146
    Report of the Legal Costs Working Group (November 2005) at para 7.7.



                                                                                                     68
6.06             The Bar Council welcomes the changes to the system of taxation of costs
             that are recommended by the Legal Costs Working Group. However, the Bar
             Council notes the dangers inherent in any attempt to render the assessment of
             costs predictable. In this regard, the Bar Council refers the Implementation
             Advisory Group to the following statement of the Competition Authority:


             “The system of taxation has negative effects on competition. It operates as a
             form of specific price regulation for certain services. It can provide a focal point
             around which fees may be indirectly fixed, and so reduce fee competition.
             Unless the system of awarding costs is reformed, it is not obvious that these
             effects can be totally eliminated.”147


       Submission 20


       6.07      The Bar Council submission is that, while certainty and predictability of costs
                 are desirable objectives, these objectives must not be pursued at the expense
                 of competition, and the Implementation Advisory Group must therefore be
                 cautious in implementing any guidelines for the assessment of costs.




       147
         Competition Authority, “Study of Competition in Legal Services” (Preliminary Report, February 24,
       2005) at para 12.20.



                                                                                                       69
CHAPTER SEVEN

LEGAL COSTS REGULATORY BODY


7.01    The Working Group recommends the establishment of a “legal costs
        regulatory body”, whose responsibilities will include setting and updating the
        proposed guidelines. The Working Group does not indicate the composition
        or structure of this “Regulatory Body”.


7.02    The Bar Council notes that similar responsibilities have been imposed on
        bodies in other jurisdictions. In England, the Supreme Court Costs Office
        drew up the guides for legal costs to be employed in the summary assessment
        of costs.


7.03    In relation to counsel’s costs, the Costs Office noted that, “It has not been
        possible to publish more specific guideline figures because of lack of
        sufficient data” and that “The figures… are based upon figures supplied by the
        Bar and in broad terms the figures are averages based on the information
        supplied.” This indicates the importance of the involvement of the Bar in any
        attempt to formulate guidance in relation to barrister’s fees.


7.04    In New Zealand, the rates that are allowed for a day’s work, for the purpose of
        the scales for recoverable costs, were arrived at in consultation with the New
        Zealand Law Society and the New Zealand Bar Assocation. It was intended
        that the same consultation and review process would take place every year.148


7.05    In New South Wales, the possibility of introducing guidance as to fair and
        reasonable costs which may be allowed in a cost assessment was considered.
        The Legislation and Policy Division of the Attorney General’s office of NSW

148
  See Paper by Justice Robert Fisher, “The New High Court Costs Regime” (November 9, 1999)
(New Zealand).



                                                                                             70
          considered the costs assessment scheme and noted that there was no such
          guidance.149 It was suggested that, “guidelines should be regularly published
          by assessors in order to educate both parties to assessments, the profession and
          the public about the fair and reasonable costs in a matter. The guidelines
          would be based on the market rates which generally applied to work
          performed in certain kinds of matters, and could be developed for different
          geographical areas.”


7.06      The Attorney General’s Legislation and Policy Division went on to consider
          the appropriate body to draw up such guidelines and concluded,


      “A mechanism for setting and reviewing guideline fees could be the
      appointment of a panel, consisting of both solicitor and barrister members and
      lay members. Neither assessors, nor solicitors or barristers, would be bound by
      the guidelines and could vary the amount allowed in any assessment, having
      regard to the factors already set out in the Act, including the skills, labour and
      responsibility of the practitioners; the complexity, novelty or difficulty of the
      matter; the quality of the work done; the place where and circumstances in
      which the work was done; and the outcome of the matter.”150


7.07      One example of such guidance may be seen in the Local Court Civil Practice
          Note 1 of 2000, which contains guidelines for legal costs.151 It is of note that
          these guidelines provide that the guideline amount for counsel fees is “As
          disclosed, in a reasonable amount, and as reasonably incurred.” The Bar
          Council particularly wishes to draw the attention of the Implementation
          Advisory Group to the fact that the guidelines were drawn up jointly by the
          Local Courts and by the Law Society of New South Wales.




149
    New South Wales Attorney General Legislation and Policy Division, Review of the Legal
Profession Act Final Report: Costs (June 1999)
150
    New South Wales Attorney General Legislation and Policy Division, Review of the Legal
Profession Act Final Report: Costs (June 1999)
151
    See Local Court Civil Practice Note 1 of 2000 (“Legal Costs”)(22 May 2000) (New South Wales).
These guidelines expressly state, “Legal costs always remain at the discretion of the Court, and the
guideline figures which follow do not diminish that discretion”.



                                                                                                   71
7.08   The Bar Council notes that other jurisdictions, which have attempted to
       formulate guidelines on legal costs, have required the direct input of the legal
       professions. The Bar Council submits that any attempt to fix costs guidelines
       in this jurisdiction will require the involvement of the Bar of Ireland.


7.09   The Bar Council moreover notes that the diversity of areas of legal practice in
       Ireland, and the differing stages, complexity and issues, relevant to legal costs,
       that may arise within each, necessitates the representation on any body
       regulating legal costs, of legal professionals from across the spectrum of areas
       of legal practice. The Bar Council moreover is of the view that such a body
       must include among its members legal professionals who are versed and
       experienced in the law and practice governing legal costs in the various areas
       of legal practice.


7.10   It is the submission of the Bar Council that the proposed “Legal Costs
       Regulatory Body” should have a majority of legal professionals among its
       members, reflecting the broad diversity of areas of legal practice, and must
       rely on figures and data gathered from persons engaged in the practice of law
       in order to ensure the accuracy and efficacy of the proposed guidelines.

Submission 21

7.11   The Bar Council submits that any attempt to fix costs guidelines in this
       jurisdiction will require the participation of legal practitioners. It is the
       submission of the Bar Council that the proposed “Legal Costs Regulatory
       Body” should have a majority of legal professionals among its members,
       reflecting the broad diversity of areas of legal practice, and must rely on
       figures and data gathered from persons engaged in the practice of law in
       order to ensure the accuracy and efficacy of the proposed guidelines. The
       Legal Costs Regulatory Body should moreover include among its members
       legal professionals who are versed and experienced in the law and practice
       governing legal costs in the various areas of legal practice.




                                                                                       72
CHAPTER EIGHT                         PROPOSALS FOR REFORM


8.01   In this Chapter, the Bar Council advances some final suggestions for the
       implementation of the Working Group’s Report. These suggestions, as well as
       the submissions made above, are within the scope of the recommendations
       contained in the Working Group’s Report and are in furtherance of the
       Group’s stated objectives. However, in formulating these models for the
       reform of legal costs, the Bar Council is also mindful of, and seeks to avoid
       and overcome, the weaknesses and shortcomings identified in previous
       chapters of these Submissions.

8.02   The suggestions for reform that are advanced in this Chapter are heavily
       influenced by the Bar Council’s view that the provision of information
       regarding legal costs to clients and prospective clients should form a central
       role in any reform of the law governing legal costs. The Bar Council
       considers that transparency is crucial to any successful reform of the rules and
       laws governing legal costs.

8.03   The Bar Council recalls the statement by Lord Woolf in the Interim Report on
       Access to Justice to the effect that, “[i]f a client knows the basis on which his
       own lawyers are charging him, he is in a better position to exercise control
       over the costs”.

8.04   The Bar Council also recalls the recommendation by the New Zealand Law
       Commission to the effect that,

  “Instead of price regulation we suggest a better response is to seek to remove
  some of the existing barriers to the efficient operation of the market… By
  making more information available to the public generally and to prospective
  users of legal services in particular, consumers would be in a better position to
  know the costs involved in taking a case to court. They could also be better
  informed about the steps required in going to court and the procedure




                                                                                        73
      involved.”152


8.05      The Bar Council wholly agrees with these statements and with the Working
          Group’s recommendation that,


      “the consumer, the individual litigant, should have a central role to play in
      controlling costs. Empowering the litigant to have a better understanding of
      what is involved in civil litigation and decision processes of a case, and to be
      actively involved in this regard – particularly with regard to cost – is an
      essential factor in ensuring the effective control of legal costs”.153


8.06      With the objectives of transparency and enhanced information in mind, the
          Bar Council makes the following suggestions for the reform of the rules,
          laws and procedures, governing legal costs in Ireland. These suggestions
          are supplemental to the other submissions that are summarised in Chapter
          Nine of these Submissions.


      A. Disclosure of information on costs

8.07      The Working Group makes certain recommendations for the amendment of
          the content and effect of the letter which solicitors are currently obliged to
          furnish to clients pursuant to section 68 of the Solicitors’ (Amendment) Act
          1994.154


8.08      The Bar Council considers that barristers also have an important role to play in
          the provision of information on legal costs. The Bar Council therefore
          proposes a model for the provision of information regarding legal costs by
          barristers, which is designed to advance the Working Group’s objectives of
          empowering the client. In formulating a suggested model for the imposition
          of disclosure obligations on barristers, the Bar Council is mindful of the
          experience of other jurisdictions.

152
    New Zealand Law Commission, Report 85, March 2004, paras. 121 and 122. See further below
regarding provision of information and recommendations made by the Law Commission in that regard.
153
    Report of the Legal Costs Working Group (November 2005) at para 6.1.



                                                                                              74
New South Wales


8.09     In New South Wales, the previous system of regulation of legal costs by
         means of fixed scales was replaced by a system based primarily on disclosure
         of legal costs. The disclosure requirements were originally introduced by the
         Legal Profession Reform Act 1993, amending the Legal Profession Act
         1987.155 This Act was amended and the disclosure requirements considerably
         augmented when the Legal Profession Act 2004 came into force on the
         October 1, 2005. The disclosure requirements which are now imposed on
         lawyers in New South Wales include an obligation to disclose to the client the
         basis on which the costs will be charged, the intervals for billing, and any
         fixed costs that apply.


8.10     A lawyer in New South Wales must also provide, “an estimate of the total
         legal costs if reasonably practicable or, if it is not reasonably practicable to
         estimate the total legal costs, a range of estimates of the total legal costs and
         an explanation of the major variables that will affect the calculation of those
         costs”.156


8.11     If the matter in question is contentious, the Legal Profession Act 2004 requires
         a lawyer in New South Wales to also disclose an estimate of “the range of
         costs that may be recovered if the client or prospective client is successful in
         the litigation, and… the range of costs the client or prospective client may be
         ordered to pay if the client or prospective client is unsuccessful.”157


8.12     A further matter which must be included in the costs disclosure, is the basis of
         charging, and an estimate of, the legal costs of a barrister, if the solicitor



154
    Report of the Legal Costs Working Group (November 2005), Chapter Six.
155
     Difficulties with, and criticisms of, the original disclosure requirements, such as widespread non-
compliance and unfettered rights to review the estimates upwards, were set out in the “Review of the
Legal Profession Act Final Report” (Legislation and Policy Division, Attorney General’s Department,
June 1999).
156
    Legal Profession Act 2004, s 309(1)(c) (New South Wales).
157
    Legal Profession Act 2004, s 309(1)(f) (New South Wales).



                                                                                                      75
         intends to retain the services of a barrister.158 The Bar Council notes that the
         barrister is not obliged to disclose costs to the client directly, but must furnish
         sufficient information to the solicitor to enable the necessary disclosure to be
         made.159


8.13     The form of the disclosure which must be furnished by lawyers in New South
         Wales is also governed by the Legal Profession Act 2004. Section 315
         provides that the requisite disclosure must be in writing, in clear plain
         language, and, if necessary, translated into a language other than English.


8.14     Section 316 of the Legal Profession Act 2004 is an important provision, which
         requires that, “A law practice must notify the client in writing of any
         substantial change to anything included in a disclosure under this Division as
         soon as is reasonably practicable after the law practice becomes aware of that
         change.” This is designed to counter the criticism that was made of the regime
         in place under the Legal Profession Act 1994, pursuant to which a lawyer was
         free to revise the original estimate of costs without making any additional
         disclosure to the client.


8.15     There are certain exceptions to the disclosure obligations imposed on lawyers
         in New South Wales. By way of example, disclosure is not necessary if the
         total costs (excluding disbursements) are likely to amount to less than $750; if
         the client is a law firm; if the client is a government minister acting in his
         capacity as such; if the client has agreed in writing to waive the right to
         disclosure; if the client will not be required to pay the legal costs (such as
         where the lawyer acts on a pro bono basis), among other exceptions.160


8.16     In New South Wales, if a lawyer fails to comply with the disclosure
         obligations, the client is not obliged to pay legal costs, and the lawyer may not
         sue to recover such costs, until the costs have been subject to assessment, and

158
   Legal Profession Act 2004, s 310(1) (New South Wales).
159
   Legal Profession Act 2004, s 310(2) (New South Wales). This rule that barristers are not obliged to
make the disclosure to clients directly, but must furnish the requisite information to the instructing
solicitors, appears in other Australian jurisdictions which have enacted similar disclosure obligations.
See, for example, the Victoria Legal Profession Act 2004, s 3.4.10.



                                                                                                     76
          the lawyer must discharge the cost of that assessment process.161 In addition,
          a lawyer’s failure to comply with the disclosure requirements “is capable of
          being unsatisfactory professional conduct or professional misconduct”.162


8.17      The Bar Council notes that the introduction of the system of costs disclosure
          in New South Wales had a significant effect on the number of complaints
          arising from legal costs. The New Zealand Law Commission considered the
          effect of the disclosure regime in New South Wales and commented that,


      “Even if cost does not reduce, consumer understanding and satisfaction should
      improve. The New South Wales Law Society reported that compulsory cost
      disclosure has led to a reduction in complaints about overcharging from 304 in
      1995/96, to four in 1997/98.”163


England and Wales


8.18      In England, the Practice Direction about Costs, Supplementing Parts 43 to 48
          of the Civil Procedure Rules (“the Practice Direction”) refers to the duty of
          solicitors to make disclosure regarding costs. Section 6 of the Practice
          Direction “sets out certain steps which parties and their legal representatives
          must take in order to keep the parties informed about their potential liability in
          respect of costs and in order to assist the court to decide what, if any, order to
          make about costs and about case management.”164 In addition, Practice Rule
          15, of the Solicitor’s Practice Rules 1990, states that solicitors shall, “…give
          information about costs and other, matters… in accordance with a Solicitors'
          Costs Information and Client Care Code.”


8.19      The Solicitors’ Costs Information and Client Care Code 1999 contains detailed
          provisions regarding the duty of solicitors’ to inform clients about costs,
          including the following:-

160
    Legal Profession Act 2004, s 312 (New South Wales).
161
    Legal Profession Act 2004, s 317(1) (New South Wales).
162
    Legal Profession Act 2004, s 317(4) (New South Wales).
163
    New Zealand Law Commission, “Delivering Justice for All” (March 2004) at para 123.
164
    Practice Direction, section 6.1.



                                                                                            77
      “(a) The solicitor should give the client the best information possible about the
      likely overall costs, including a breakdown between fees, VAT and
      disbursements.
      (b) The solicitor should explain clearly to the client the time likely to be spent in
      dealing with a matter, if time spent is a factor in the calculation of the fees.
      (c) Giving "the best information possible" includes:
      (i) agreeing a fixed fee; or
      (ii) giving a realistic estimate; or
      (iii) giving a forecast within a possible range of costs; or
      (iv) explaining to the client the reasons why it is not possible to fix, or give a
      realistic estimate or forecast of, the overall costs, and giving instead the best
      information possible about the cost of the next stage of the matter.
      (d) The solicitor should, in an appropriate case, explain to a privately paying
      client that the client may set an upper limit on the firm's costs for which the
      client may be liable without further authority. Solicitors should not exceed an
      agreed limit without first obtaining the client's consent.
      …(f) The solicitor should also explain to the client how the firm's fees are
      calculated except where the overall costs are fixed or clear. If the basis of
      charging is an hourly charging rate, that must be made clear.
      (g) The client should be told if charging rates may be increased.
      (h) The solicitor should explain what reasonably foreseeable payments a client
      may have to make either to the solicitor or to a third party and when those
      payments are likely to be needed.
      (i) The solicitor should explain to the client the arrangements for updating the
      costs information as set out in paragraph 6.”165


8.20       The Solicitors’ Costs Information and Client Care Code 1999 moreover
           provides that solicitors must keep the client properly informed about costs as a
           matter progresses.166




165
      Solicitors' Costs Information and Client Care Code 1999 at para 3.
166
      Solicitors’ Costs Information and Client Care Code 1999 (as of March 9, 2004) at para 6.



                                                                                                 78
8.21    There appears to be no specific obligations in the Code of Conduct for
        barristers to furnish information regarding legal costs in England and Wales.


New Zealand


8.22    In the report on “Delivering Justice for All: A Vision for New Zealand Courts
        and Tribunals,”167 the Law Commission focused on the importance of the
        dissemination and provision of information regarding legal costs. The
        Commission emphasised that the “more informed users of legal services are
        about the costs involved, the better able they will be to make informed
        decisions.”168 The Commission was heavily critical of the lack of obligations
        on lawyers to make disclosure about legal costs, noting that, “Currently,
        lawyers are not required to provide detailed information about how much their
        services will cost.” 169


8.23    The Commission made a number of recommendations regarding the provision
        of information about legal costs, including the recommendation that the Rules
        of Professional Conduct be amended to place specific requirements on lawyers
        in this regard. The Law Commission recommended that lawyers should be
        required to provide details of the method of billing, a written estimate of costs,
        or a forecast within a possible range of estimates.170 It was also recommended
        that lawyers should be required to explain the possible outcomes of the matter
        and their likely effect on cost and updates and interim bills as the matter
        progresses.


8.24    The Law Commission did acknowledge in this regard that, “The extent to
        which this would be appropriate will depend on the level of the claim – the


167
    New Zealand Law Commission, Report 85, March 2004.
168
    New Zealand Law Commission, Report 85, March 2004, para. 142. The Commission also
commented that if there was enhanced information available, “Even if cost does not reduce, consumer
understanding and satisfaction should improve” (para. 123).
169
    New Zealand Law Commission, Report 85, March 2004, para. 124. The Commission did also note
that, “Many lawyers in New Zealand do provide good information to clients, and the Law Commission
is convinced that all lawyers could, at little extra cost and inconvenience, give more information to
potential clients” (para. 132.)
170
    New Zealand Law Commission, “Delivering Justice for All” (Report 85, March 2004)
(Recommendation 16).



                                                                                                   79
        amount of time preparing bills should not be disproportionate nor increase cost
        for the client.”171 The Law Commission recommended that “Failure to adhere
        to these standards should lead to censure of the practitioner in question, and
        should be capable of amounting to misconduct or conduct unbecoming a
        barrister or solicitor.”172


8.25    In its response to the Law Commission Report, the Government of New
        Zealand referred to the Lawyers and Conveyancers Bill (now the Lawyers and
        Conveyancers Act 2006, having been enacted on March 20, 2006). The
        Government noted that the Bill provided for a Disciplinary Tribunal to hear
        charges against lawyers for matters including misconduct and unsatisfactory
        conduct and that a failure to adhere to any fees disclosure requirements in
        professional practice rules would be capable of amounting to unsatisfactory
        conduct or misconduct.173


8.26    The Government did not agree with the recommendation that the existing
        Rules of Professional Conduct should be amended to provide for specific
        disclosure requirements on lawyers. The Government stated, “This would be
        inconsistent with the general approach of the Bill. The Bill provides the NZLS
        with the flexibility to make prescriptive disclosure rules.”174 Section 94(j) of
        the Lawyers and Conveyancers Act 2006 (20 March 2006) provides that the
        New Zealand Law Society must have rules that include a requirement that
        practitioners provide clients in advance with information regarding the “basis
        on which fees will be charged”. The Code of Professional Conduct does not
        yet appear to have been amended in compliance with this requirement.


Suggestions for reform


8.27    The Bar Council submits that a rule could be introduced requiring barristers to
        disclose certain information regarding costs at the time of, or as soon as

171
    New Zealand Law Commission, “Delivering Justice for All” (Report 85, March 2004)
(Recommendation 16).
172
    New Zealand Law Commission, “Delivering Justice for All” (Report 85, March 2004)
(Recommendation 17).
173
    New Zealand Government Response to Law Commission Report 85, para 103.



                                                                                         80
        practicable after, accepting instructions to act in a matter. The following is a
        model which could be adopted for such a disclosure obligation.



(a)     Disclosure to solicitor


8.28    The Bar Council suggests that the costs disclosure obligation would require a
        barrister to make the necessary costs disclosure to the instructing solicitor,
        who would then bear responsibility for conveying this disclosure to the
        client.175 A barrister cannot be directly responsible for the communication of
        the costs disclosure to the client. Once a barrister has made the requisite costs
        disclosure to the solicitor, he will have discharged his responsibility in relation
        to the initial disclosure of costs.



(b)     Content of letter of disclosure


(i)     Description of work

8.29    The letter of disclosure should contain a description of the work that is
        expected to be required for the matter in question. This description should list
        the steps that it is anticipated will be necessary in the litigation, such as the
        type of proceedings that will need to be issued; any injunctions that may need
        to be sought; such applications for discovery, interrogatories or other
        interlocutory reliefs as may be necessary; and any other anticipated steps that
        may be required.


8.30    Within each of these steps, the tasks that will need to be undertaken should be
        set out. This will include a list of the documents that will need to be drafted,
        and the court appearances, opinion work, consultations and any other tasks
        that are anticipated to be necessary.



174
  New Zealand Government Response to Law Commission Report 85, para 105.
175
  This is in accordance with the rules considered above which have been introduced in New South
Wales and other Australian jurisdictions such as Victoria. See Legal Profession Act 2004, s 310(2)
(New South Wales) and Legal Profession Act 2004, s 3.4.10 (Victoria).



                                                                                                     81
(ii)    Estimate of costs

8.31    The letter of disclosure should include an estimate of the overall costs that can
        expect to be incurred. If this is not possible, an estimate of the range within
        which the costs may fall should be furnished. This estimated range of costs
        should include an explanation of the factors which may affect the point within
        the range at which the costs will ultimately be set. In this regard, the
        disclosure can draw upon the factors referred to in Submission 11 above and
        indicate which of these factors may have an impact on the ultimate costs
        incurred.


(iii)   Allocation of costs

8.32    The Bar Council considers that the disclosure of legal costs should include a
        statement regarding the possibility of an award of costs being made at the
        culmination, or in the course, of the case. This statement should endeavour to
        assess the prospect of recovery of legal costs from the other party or parties to
        the litigation and, conversely, the prospect of an order of costs being made
        against the client. The statement regarding recovery of costs should moreover
        attempt to explain the circumstances and events which may affect the
        allocation of costs.



(c)     Timing of letter of disclosure


8.33    The disclosure of the expected legal costs should be made before the barrister
        receives instructions, or at the earliest possible opportunity thereafter. There
        must be accommodation of the fact that in urgent cases, such as cases in which
        interim injunction are sought, it will not be possible for the necessary
        disclosure to be made before taking instructions.


8.34    Except where it is not possible to do so, due to the urgency of the
        circumstances, the solicitor, and client, should have a “cooling off” period to
        determine whether to accept the estimate of costs contained in the letter of
        disclosure. Solicitors should moreover be encouraged to “shop around” and


                                                                                          82
              obtain estimates from a number of barristers, a practice of which the Bar
              Council has already expressed its support.176



(d)           Updates


8.35          The Bar Council submits that the obligation to make costs disclosure should
              include an obligation to provide updates. The Bar Council submits that, in the
              interests of empowering the client and ensuring they are kept informed, and in
              control, in relation to legal costs, a barrister should send a supplemental
              disclosure letter in the following circumstances:


       (i)        If something occurs within the context of the litigation which has a
                  significant effect on the costs estimated in the disclosure letter, or upon the
                  possible allocation of costs;
       (ii)       If no such event occurs, a barrister should provide costs letters at periodic
                  intervals, such as every 12 months, to inform the client of the status of the
                  estimate furnished at the outset.



(e)           Exceptions


8.36          A letter of disclosure should not be necessary in every circumstance. By way
              of example, if the matter is of a low value (such as matters within the
              jurisdiction of the District Court) or if the client agrees in writing, it should not
              be necessary to provide a letter of disclosure. The Bar Council welcomes the
              views of the Implementation Advisory Group regarding any additional
              exceptions which may be appropriate.



(f)           Effect of letter of disclosure


8.37          The Bar Council, having considered the systems that have been analysed,
              recommended and introduced in other jurisdictions, suggests that a failure to

176
      Bar Council Submissions to the Legal Costs Working Group (February 2005) at para 13.1(a).



                                                                                                  83
       furnish the letter of disclosure, should be relevant to the ability to recover the
       costs incurred. This could be achieved by means of a provision in a practice
       ruling of the Professional Practice Committee to the effect that costs which
       were not disclosed in accordance with the recommendations contained in these
       Submissions, should not be recoverable, unless the costs were assessed to have
       been reasonable by a costs assessor, court or taxing master, as appropriate.


8.38   This sanction should not however apply, if the barrister can demonstrate that
       he did make the requisite disclosure to the solicitor and the solicitor failed to
       convey the information to the client. In addition, a failure to make the
       requisite disclosure may be taken into account in the taxation (or assessment,
       as appropriate) of costs.



(g)    Professional Practices Committee


8.39   The Bar Council is very conscious of the fact that any rules requiring
       disclosure of costs information should be easy to understand, apply and
       enforce. The experience of other jurisdictions (such as that of New South
       Wales before the introduction of the Legal Profession Act 2004), demonstrate
       that it is important that obligations of disclosure should not be overly complex
       and should be readily capable of reform.


8.40   In accordance with the approach proposed in New Zealand and that which is
       in place in England, the Bar Council proposes that rules for the disclosure of
       information on legal costs should be in included in a practice ruling to be
       issued by the Professional Practices Committee of the Bar of Ireland. This
       would be mandatory and binding upon every barrister, in accordance with the
       Code of Conduct for the Bar of Ireland. In this regard, the Bar Council notes
       that in New South Wales where the rules governing disclosure were enacted in
       legislation, it became apparent that the rules required amendment and it was
       necessary to amend the legislation accordingly. The Bar Council therefore
       submits that rules governing the obligation to make disclosure of legal costs
       should be contained in a practice ruling to be issued by the Professional



                                                                                        84
           Practices Committee of the Bar of Ireland and, if amendments prove necessary
           to ensure the efficacy of the disclosure system, this can be achieved by
           amendment of such rulings, rather than necessitating the enactment of
           amending legislation.



B.         Costs Agreements

8.41       The Bar Council notes that the Working Group does not purport to limit the
           right of clients and their legal representatives to form agreements regarding
           legal costs. The Code of Conduct for the Bar of Ireland provides that, “In all
           cases the number of barristers to be briefed and the fees to be charged by each
           such barrister shall be a matter for agreement between each such barrister and
           the instructing solicitor.”177 According to section 4 of the Attorneys’ and
           Solicitors’ Act 1870, solicitors can enter costs agreements with their clients in
           contentious matters.


8.42       The Bar Council considers that the formation of costs agreements at the time
           of, or shortly after, the acceptance of instructions to act in a matter, should be
           encouraged. The view of the Bar Council is that costs agreements advance the
           objectives of empowering the client, and favour transparency and
           predictability in relation to legal costs, objectives which are advocated
           strongly by the Working Group.


8.43       The Bar Council notes that in jurisdictions in which disclosure of costs is
           obligatory, the costs disclosure can also form the basis for cost agreements.
           By way of example, in Victoria, the document containing the prescribed
           information on costs will often also constitute an agreement as to costs. The
           Law Society of Victoria has drafted a document entitled “Disclosure of Legal
           Costs and Costs Agreement, between a Barrister and Solicitor”, which may
           form a precedent for use by practitioners.




177
      Code of Conduct for the Bar of Ireland (March 13, 2006), Rule 12.3.



                                                                                            85
8.44     The effect of this approach is that the disclosure of costs to a solicitor,
         followed by acceptance by the solicitor and the client, in writing or by
         conduct, (such as the furnishing of instructions to act in the matter) of that
         disclosure, may be subsequently relied upon by the barrister and solicitor as a
         costs agreement.


8.45     The Bar Council considers that the formation of agreements regarding costs at
         the outset is a practice that should be encouraged. The Bar Council therefore
         advances a draft document which may be used by barristers and solicitors to
         fulfil the dual function of providing information on legal costs and constituting
         an agreement as to legal costs. This document is attached to this Chapter as
         Appendix A.


8.46     The Bar Council proposes that, where such an agreement is formed, it should
         govern the costs between the parties and should not be displaced unless the
         agreement is challenged by the client and a court or legal costs assessor (or
         taxing master, as the case may be) determine the agreement to be unfair and
         unreasonable.178



C.       “Brief fee”


8.47     The Bar Council repeats the Submissions made in Chapter Five and, in
         particular, the following submission at paragraph 5.19 above:-


     “The Bar Council submits that, in the interests of transparency, a rule could be
     included in a practice ruling to be issued by the Professional Practices
     Committee of the Bar of Ireland requiring that, in marking a brief fee, a barrister
     should identify and enumerate the work undertaken in preparation for the
     hearing of the matter, such as the legal research conducted, the procedural
     matters considered, all papers that were reviewed, discovery and background
     material that were examined and considered, the preparation of strategies, the




                                                                                           86
      planning of witness examinations, the outlining and drafting of legal
      submissions and factual background documents, and other such work done by
      the barrister in the preceding months or years in preparation for the trial.”


8.48      The Bar Council moreover submits that use of the term “brief fee” which
          appears to have been misleadingly associated with the “instructions fee”
          charged by solicitors, should be discontinued. The Bar Council considers that
          it may be appropriate to refer to the work conducted in preparation for, and in
          the first day of, the hearing of a matter could be appropriately described as a
          “case fee”.

D.        Fee notes

8.49      The Bar Council submits that it is appropriate, and in the interests of
          transparency, that a fee note which a barrister sends to a solicitor should
          include a description of the work done, and the costs associated with such
          work.


8.50      The Bar Council is mindful of the Working Group’s concern that the “lumping
          together” that occurs in relation to instructions fees “seriously inhibits
          transparency and openness”.179 The Bar Council considers that it may be
          appropriate to include a requirement in a practice ruling to be issued by the
          Professional Practices Committee of the Bar of Ireland to the effect that the
          fee note should include a description of the work done and tasks undertaken
          and the fees charged for such work and tasks.


8.51      As noted at Submission 11 above, the Bar Council considers that there are a
          number of factors that should be taken into account in setting any guidelines
          regarding legal costs and in any assessment of legal costs. The Bar Council
          submits that it is equally appropriate that barristers should take these factors
          into account in determining the level of fees to charge in an individual case.


178
    See, as an example of a similar approach, section 328(1) of the Legal Profession Act 2004 (New
South Wales, which provides that, “On application by a client, a costs assessor may order that a costs
agreement be set aside if satisfied that the agreement is not fair or reasonable.”
179
    Report of the Legal Costs Working Group (November 2005) at para 2.4.



                                                                                                     87
8.52    In determining the reasonable fee to charge in an individual case, a barrister
        should therefore take account of the following factors:-
       The time spent on the matter;
       The labour and effort involved;
       The skill, responsibility, and specialised knowledge involved;
       The complexity, novelty or difficulty of the issues;
       The value of the claim or subject matter;
       The importance of the case to the client or in the public interest;
       The quality of the work done;
       The place and circumstances in which the work is done;
       Any time limitations imposed on the lawyers by the client or the
       circumstances; and
       The seniority, experience, reputation and ability of the lawyer.


8.53    The Bar Council further submits that the fee notes issued by a barrister should
        mirror the factors set out in the disclosure that will be required to be issued at
        the time of, or as soon as practicable after, accepting instructions to act in a
        matter. It will be necessary for the fee note to set out the factors and
        considerations which caused a deviation, if any, from the fees estimated in
        such fee disclosure.


E.      Guidelines

8.54    The Bar Council repeats its concerns and misgivings regarding the
        “guidelines” proposed in the Working Group’s Report, and the inconsistencies
        and ambiguities in the formulation of those “guidelines” in the Report.180


8.55    The Bar Council is concerned that, until the reform of the litigation system
        recommended by the Working Group has been given effect to, and the
        changes and developments sought in Chapter 8 and elsewhere in the Report
        have taken place, it is not feasible to assess the costs of litigation on an




                                                                                           88
        objective basis. The Bar Council recalls the recommendation at paragraph
        2.11 of the Working Group’s Report that,


         “the Government should ensure that the level of judicial resources required
         to carry out the work of each bench effectively and efficiently is provided.
         However, the issue of resources cannot be separated from other relevant
         factors impinging on judicial effectiveness such as organisation of
         districts/circuits, management of judicial resources and working practices.”


8.56    The Bar Council considers that, while it is true that the issue of resources
        cannot be separated from other factors which affect judicial effectiveness, it is
        absolutely undeniable that these matters, as well as the overall problems with
        delay identified elsewhere in the Working Group’s Report, cannot be
        separated from the legal costs which are incurred in litigating within this
        judicial system.


8.57    The Bar Council is moreover conscious of the fact that, when other
        jurisdictions have introduced elaborate rules governing costs, they have done
        so as part of a protracted and complex process of review of overall access to
        justice. By way of example, the Woolf Reports181 were the starting points for
        the reform process which is still ongoing in England and Wales and the reform
        of the law governing the legal profession has been ongoing in New South
        Wales since 1987, necessitating numerous legislative amendments.182


8.58    While Ireland can take guidance from other jurisdictions, it must be firmly
        borne in mind that these jurisdictions went through extensive and protracted
        processes of review of the overall legal landscape. The reform of legal costs
        was therefore largely conducted against the background of more extensive
        procedural and structural changes within the court systems.



180
    See Submissions 1 to 20, as summarised in Chapter Eight of these Submissions.
181
    The Interim Report on Access to Justice (June 1995) and the Final Report on Access to Justice (July
1996).
182
    See, for example, the Legal Profession Act 1987; the Legal Profession Reform Act 1993; the Legal
Profession Act 2004.



                                                                                                    89
8.59     It must moreover be borne in mind that, if the proposed “guidelines” are to
         have an effect similar to fixed scales of costs, a concern addressed in Chapter
         Two of these Submissions, the experience of other jurisdictions which have
         adopted this approach has been mixed, with some reversing the approach
         entirely and others limiting the scope of such scales very considerably.183


8.60     These reservations, and the others expressed earlier in these Submissions,
         notwithstanding, the Bar Council is aware of the merit of increased
         predictability and transparency in legal costs. It is for this reason that the Bar
         Council submits the above model for the disclosure of legal costs, the
         formation of legal costs agreements and the provision of detailed information
         in fee notes, setting out the factors which are relevant to the costs incurred.


8.61     The Bar Council recalls its submission that any guidelines for the calculation
         of legal costs must take into account each of the factors listed in Submission
         11 above. The Bar Council moreover considers that the fact that each of these
         factors will be reflected in the estimate of costs contained in the proposed
         letter of disclosure and in the costs ultimately detailed in the fee note, ensures
         that these guidelines will be taken into account.


8.62     Finally, the Bar Council submits that the model proposed in this Chapter for
         the disclosure and setting of costs, guided by the factors set out in Submission
         11 above, is wholly in line with the recommendation of the Working Group
         for the establishment of “fee guidelines for each aspect of work done adjusted
         to take into consideration the time taken in conducting the action, its
         complexity and the jurisdictional level of the action.”184




183
    In England and Wales, for example, while the Woolf Reports recommended that fixed costs be
introduced in a broad range of cases, fixed costs were actually only introduced in tightly defined,
limited categories of cases, such as road traffic accidents of a value below £10,000 in which only costs
were at issue.
184
    Report of the Legal Costs Working Group (November 2005) at para 5.24.



                                                                                                      90
Submission 26


8.63   The Bar Council submits that implementation of costs’ guidelines in the
       disclosure of costs and fee notes, taking account of all of the relevant factors
       and allowing a subjective application of the guidelines to the facts of each
       individual case, will achieve the objectives of certainty, predictability and
       transparency more effectively than any fixed or quasi-fixed scales of costs and
       is the same in formulation, function and effect as the guidelines proposed by
       the Working Group.




                                                                                       91
CHAPTER NINE                   SUMMARY OF SUBMISSIONS


Submission 1


The Bar Council submits that the Implementation Advisory Group should be vigilant
to ensure the principle that “costs follow the event”, the importance of which is
recognised by the Working Group, is not undermined by excessively restrictive
guidelines. The Bar Council also submits that the principle of equality of arms should
be carefully guarded and protected in the formulation and implementation of the
proposed guidelines. [paragraph 2.08]


Submission 2


In light of the criticisms and failures of fixed scales systems in Ireland and elsewhere,
the Bar Council strongly endorses the Working Group’s recommendation that such
fixed scales should not be introduced. The Bar Council submits that fixed scales are
anti-competitive and are neither desirable nor workable as a means of determining
legal costs. The Bar Council accordingly submits that the guidelines that are
proposed by the Working Group should not have the same, or a similar effect, as fixed
scales of legal costs. For this reason, the Bar Council submits that the Implementation
Advisory Group should ensure that the proposed guidelines do not directly or
indirectly have the same effect as fixed scales for recoverable legal costs. [paragraph
2.31]


Submission 3


The Bar Council submits that, while the context within which the cost guides were
formulated in England is very particular and must be born in mind in assessing that
costs’ system, the costs guidelines of that jurisdiction appear to truly have the effect
of guidelines rather than scales of costs. The Bar Council therefore submits that the
effect (if not necessarily the content) of the English costs’ guidelines should be



                                                                                           92
considered as a useful model by the Implementation Advisory Group. [paragraph
2.41]


Submission 4


The Bar Council reiterates that the proposed guidelines should only be of relevance as
a guide and a means of “informing” the appropriate level of legal costs and should not
have the same, or a similar, effect as scales of fixed costs. [paragraph 2.43]


Submission 5


The Bar Council requests clarification in relation to the “limits” referred to at
paragraph 7.18 of the Report and would welcome the opportunity to make such
further submissions as may be appropriate, upon receipt of the requested clarification.
[paragraph 2.48]


Submission 6


The Bar Council submits to the Implementation Advisory Group that the Working
Group’s Report refers to a number of different possible means of formulating and
implementing the proposed “guidelines”, not all of which are consistent with each
other. While the Bar Council attempts to make submissions in relation to the
guidelines proposed by the Working Group, the ambiguities and inconsistencies in
relation to this aspect of the Report, make it difficult to furnish definitive submissions.
The Bar Council therefore hopes that it will have the opportunity to make more
informed and concrete submissions, when the content, scope and effect of the
proposed guidelines have been further clarified. [paragraph 2.58]


Submission 7


It is the Bar Council submission to the Implementation Advisory Group that it is more
accurate, more workable, and more realistic, to formulate the guidelines in a manner
which encompasses the work actually done in a particular case, rather than relying on
an objective assessment of that work. [paragraph 2.69]


                                                                                        93
Submission 8


It is the Bar Council’s submission to the Implementation Advisory Group that the
amount of time expended on a matter is one factor to be taken into account in
assessing the appropriate level of legal costs, and is so reflected in the Code of
Conduct of the Bar of Ireland, but that it should only be one of the factors to be
weighed. The Bar Council submits that extreme caution should be exercised before
introducing guidelines for the determination of recoverable legal costs, on the basis of
the time spent on the matter in question. In other jurisdictions in which time-based
billing has become the practice, this system of billing has received sustained and
virulent criticism. Moreover, such a system of billing would be singularly unsuitable
for assessing the work of a barrister. [paragraph 2.87]


Submission 9


The Bar Council submits that until the structural and procedural factors that inhibit
the efficiency and predictability of the litigation process are addressed, and the
recommendations of the Working Group towards this end are implemented, it is not
realistic to attempt to assign objective timeframes to particular tasks and steps within
the litigation process. [paragraph 2.90]


Submission 10


The Bar Council submission to the Advisory Implementation Group is that, while
legal costs should not be fixed as a direct proportion of the value of a claim, the value
of a case and its importance are factors that should be taken into account in
determining a reasonable level of legal costs. [paragraph 2.93]




Submission 11


It is the Bar Council’s submission to the Implementation Advisory Group that the
factors that should be taken into account in setting (or applying) guidelines for


                                                                                       94
recoverable legal costs should encompass, or at least allow accommodation of, the
following:
      The time spent on the matter;
      The labour and effort involved;
      The skill, responsibility, and specialised knowledge involved;
      The complexity, novelty or difficulty of the issues;
      The value of the claim or subject matter;
      The importance of the case to the client or in the public interest;
      The quality of the work done;
      The place and circumstances in which the work is done;
      Any time limitations imposed on the lawyers by the client or the
      circumstances; and
      The seniority, experience, reputation and ability of the lawyer.
      [paragraph 2.110]




Submission 12


The Bar Council submits that any amendment to the proposed guidelines must be
preceded by a process of consultation with the Council of the Bar of Ireland and the
Law Society of Ireland and must involve the input and participation of both the Bar
and the Law Society. [paragraph 2.114]



Submission 13


The Bar Council welcomes any recommendations that have the objective of making
court systems and procedures more efficient and expeditious. However, the Bar
Council also submits that the Implementation Advisory Group should be mindful of
the practical, and cost, implications of imposing extra burdens and compliance
requirements on practitioners. [paragraph 3.04]




                                                                                       95
Submission 14


The Bar Council welcomes the Working Group’s call for an improved system of civil
legal aid across the spectrum of issues which require resolution in the courts.
[paragraph 3.14]


Submission 15


The Bar Council submits to the Implementation Advisory Group that certain changes
to the manner in which judicial resources are allocated and cases are handled and
listed before the courts, are essential before any predictability of costs can be
guaranteed and before a comprehensive and workable system of guidelines for costs
can be introduced. [paragraph 3.17]


Submission 16


The Bar Council submission to the Implementation Advisory Group is that, while the
Bar Council is fully aware of the importance of the provision of information regarding
legal costs to clients, and the role of barristers in that regard, the formulation of any
rules governing such information should reflect the fact that it is often difficult for a
barrister to provide an exact estimate of legal costs and that such information will
generally be furnished to a solicitor, rather than to the client directly. [paragraph 4.10]


Submission 17


The Bar Council submission to the Implementation Advisory Group is that there is
never a requirement that a client must retain the services of a senior counsel. It is a
matter for an instructing solicitor, and the client, to determine whether to instruct a
senior counsel in a matter, and the number of counsel to instruct in any matter.
[paragraph 5.09]




                                                                                        96
Submission 18


The Bar Council submits that, in the interests of transparency, consideration could be
given to including a requirement in a practice ruling to be issued by the Professional
Practices Committee of the Bar of Ireland that, in marking a brief fee, a barrister
should identify and enumerate the work undertaken in preparation for the hearing of
the matter, such as the legal research conducted, the procedural matters considered, all
papers that were reviewed, discovery and background material that were examined
and considered, the preparation of strategies, the planning of witness examinations,
the outlining and drafting of legal submissions and factual background documents,
and other such work done by barristers in the preceding months or years in
preparation for the trial. [paragraph 5.19]


Submission 19


The Bar Council submission to the Advisory Implementation Group is that, when a
barrister has been briefed and prepared for the hearing of a matter which settles before
the commencement of the hearing, the barrister is entitled to remuneration for all of
the preparatory work that was actually and appropriately done and for the time which
was dedicated to represent the client at that hearing. [paragraph 5.24]


Submission 20


The Bar Council submission is that, while certainty and predictability of costs are
desirable objectives, these objectives must not be pursued at the expense of
competition, and the Implementation Advisory Group must therefore be cautious in
implementing any guidelines for the assessment of costs. [paragraph 6.07]


Submission 21


The Bar Council submits that any attempt to fix costs guidelines in this jurisdiction
will require the participation of legal practitioners. It is the submission of the Bar
Council that the proposed “Legal Costs Regulatory Body” should have a majority of



                                                                                         97
legal professionals among its members, reflecting the broad diversity of areas of legal
practice, and must rely on figures and data gathered from persons engaged in the
practice of law in order to ensure the accuracy and efficacy of the proposed
guidelines. The Legal Costs Regulatory Body should moreover include among its
members legal professionals who are versed and experienced in the law and practice
governing legal costs in the various areas of legal practice. [paragraph 7.11]




Submission 22


The Bar Council submits that consideration should be given to the introduction of a
rule in a practice ruling to be issued by the Professional Practices Committee of the
Bar of Ireland requiring barristers to disclose certain information regarding costs to
the instructing solicitor at the time of, or as soon as practicable after, receiving
instructions to act in a matter. The information would include a description of the
steps that are anticipated to be necessary in the litigation (such as the issue of
proceedings, interlocutory applications); the tasks that are expected to be necessary
within each such step (such as drafting, opinions, consultations, court appearances);
an estimate of the costs, or a range of costs; and a statement regarding the possible
allocation of liability for costs during and at the culmination of, the case. The solicitor
and client should have a “cooling off” period within which to consider this estimate
and solicitors should be encouraged to obtain quotes from other barristers. The
disclosure statement would need to be updated in the event of a significant change in
the estimate or, alternatively, at defined periodic intervals. [paragraphs 8.30 to 8.41]


Submission 23


The Bar Council considers that the formation of costs agreements at the time of, or
shortly after, accepting instructions to act in a matter, should be encouraged. Towards
this end, the Bar Council suggests that the disclosure of costs to a solicitor, followed
by acceptance by the solicitor and the client, in writing or by conduct, of that
disclosure, may be subsequently relied upon by the barrister and solicitor as a costs
agreement. The Bar Council advances the document attached at Appendix A as a



                                                                                         98
model for such a costs disclosure and costs agreement between a barrister and a
solicitor. The Bar Council proposes that such an agreement should be of binding
effect unless a court, costs assessor or taxing master (as applicable) determines it to be
unfair and unreasonable. [paragraphs 8.46 to 8.47]



Submission 24

The Bar Council suggests that a rule could be included in a practice ruling of the
Professional Practices Committee of the Bar of Ireland requiring that, in marking a
“case fee”, a barrister should identify and enumerate the work undertaken in
preparation for the hearing of the matter and should set out detailed information
explaining, by reference to the relevant factors, any difference between the estimate
contained in the letter of disclosure and fee marked. This Submission is detailed at
paragraph 5.19 in these Submissions. [paragraph 8.49]


Submission 25


The Bar Council considers that it may be appropriate to include a requirement in a
practice ruling to be issued by the Professional Practices Committee of the Bar of
Ireland to the effect that a barrister’s fee note should enumerate the work done and
tasks undertaken and the fees charged for such work and tasks. In marking the fee
note, a barrister should take account of, and explain the relevance of, the factors listed
in Submission 11 of these Submissions. Any deviations between the estimate
contained in the letter of disclosure and the fees contained in the fee note, should be
explained by reference to the relevant factors and criteria. [paragraphs 8.50 to 8.54]


Submission 26


The Bar Council submits that implementation of costs’ guidelines in the disclosure of
costs and fee notes, taking account of all of the relevant factors and allowing a
subjective application of the guidelines to the facts of each individual case, will
achieve the objectives of certainty, predictability and transparency more effectively
than any fixed or quasi-fixed scales of costs and is the same in formulation, function
and effect as the guidelines proposed by the Working Group. [paragraph 8.64]



                                                                                          99
                APPENDIX A



DISCLOSURE OF LEGAL COSTS AND COSTS AGREEMENT

     BETWEEN A BARRISTER AND A SOLICITOR




    (Draft Model Disclosure and Agreement)




                                                100
              DISCLOSURE OF LEGAL COSTS AND COSTS AGREEMENT
                   BETWEEN A BARRISTER AND A SOLICITOR



This Agreement is made between [INSERT name of barrister] and [INSERT name
of solicitor] this [INSERT day] of [INSERT month] in the year [INSERT year] in
relation to the matter(s) of [INSERT name of matter(s)] (“the Matter”).

Rule ____ of the Code of Conduct for the Bar of Ireland (“the Code of Conduct”)
requires that I (barrister) disclose certain information to you (solicitor) regarding the
legal costs I will charge in relation to the Matter. The Code of Conduct also provides
that we may enter into a costs agreement which sets out the terms on which I offer to
undertake work for you.

If, having read the disclosure information in part A hereof, you agree to the terms on
which I offer to undertake work for you, you can accept my offer in this costs
agreement by either signing the enclosed copy of this agreement and returning it to
me or by continuing to provide me with instructions in the Matter.

A.     DISCLOSURE OF LEGAL COSTS

       Pursuant to Rule ____       of the Code of Conduct, I disclose the following
       information relating to my legal costs in the Matter.

1.     Estimated work required

       Based on the instructions and documents with which I am presently briefed, I
       consider that the following steps may be required in this Matter:

       (a)     Issue   of________     proceedings     in   _____     Court   (drafting    of
       proceedings, opinion regarding Matter, consultation);

       (b)     Application for_____________ [injunctive relief] (drafting; [insert
       number] court appearances; consultation; possible opinion);

       (c)     Application for ____________ [other interlocutory relief] (drafting;
               [insert number] court appearances; consultation; possible opinion);

       (d)     [Any other steps that may be required].

2.     Estimated legal costs



                                                                                         101
Based on the instructions and documents with which I am presently briefed, I
estimate my legal costs will be [INSERT]. This estimate reflects the following
factors:

(a)     [Complexity, novelty or difficulty, if applicable];

(b)     [Value or importance of matter, if applicable];

(c)     [Time that will be required];

(d)     [Urgency of the matter, if applicable];

(e)     [Any particular skill, expertise, seniority, experience, knowledge as
        may be necessary];

(f)     [Any other relevant factors which affect the level of the estimate].

The above estimate is based on the work required as I am presently
instructed and it is disclosed to enable you to comply with your disclosure
requirements under the Solicitors’ Amendment Act 1994 [or insert other
legislation as appropriate]. I advise that this estimate is given as an indication
only and I am not bound by it.

Should the scope or nature of my work, or the factors listed above, change in
light of any further instructions I may receive from you or developments within
the Matter, the above estimate may need to be revised.

-OR-

As I am presently instructed, it is not reasonably practicable for me to
estimate my total legal costs. I estimate that the range of estimates of my
total legal costs in the Matter is between [INSERT] and [INSERT]. The major
factors that will affect the calculation of my legal costs are as follows:

(a) [Complexity, novelty or difficulty, if applicable];

(b) [Value or importance of matter, if applicable];

(c) [Time that will be required];

(d) [Urgency of the matter, if applicable];




                                                                               102
        (e) [Any particular skill, expertise, seniority, experience, knowledge as may
              be necessary];

        (f) [Any other relevant factors which affect the level of the estimate].

3.      Revisions to estimate

        In the event of any events occurring within the litigation, which have a
        significant effect on the costs estimated above, I will forward to you an update
        of the above estimate.

        Subject to any further instructions I receive from you which have the effect of
        varying the nature or the scope of the work in the Matter, I will forward to you
        an account for work done at the following intervals:

        (a)      once the work set out above has been competed; or

        (b)      at the end of [the appropriate period needs to be determined and
                 inserted here].




4.      Allocation of costs

        Based on the instructions and documents with which I am presently briefed, I
        consider that there is a [insert statement regarding the possibility of recovery
        of legal costs from the other party in the Matter and the possibility of an order
        for costs being made against the client].




B.      COSTS AGREEMENT

     1. Work to be undertaken

        As presently instructed you have engaged me to [INSERT scope of retainer]
        (“Work”).

        An estimate of the nature of the Work (and the value of the Work) to be
        undertaken by me is set out in A(1) above. The scope of Work may vary
        depending on any further instructions I receive from you and other
        developments within the Matter.



                                                                                      103
2.   Fees

     I offer to undertake the Work in accordance with the estimate set out in
     paragraph A(2) above. You should indicate your acceptance of my rates by
     either signing the document below and retuning a signed copy to me. You
     may also indicate your acceptance of my rates by continuing to provide me
     with instructions in the Matter.

3.   Agreement

     By signing and returning a copy of this document you agree to be bound by
     the terms in it. You may also agree to the terms herein by continuing to
     provide me with instructions in the Matter.




SIGNED            BY                           SIGNED BY SOLICITOR:
BARRISTER
                                               PRINT NAME:
PRINT NAME:
                                               DATE:
DATE:




                                                   SIGNED BY CLIENT

                                                   PRINT NAME:

                                                   DATE:




                                                                                104

				
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