1. Barristers’ Cost Disclosure
“Law practices” (including barristers)
must make costs disclosures under
division 3 of part 3.4 of LPA .
These provisions have been force since
LPA commenced on 1 July 2007.
Non-compliance by a barrister may
have very significant adverse
2. To Whom Must Disclosure
The primary obligation is to make disclosure
to the “ client” .
“Client” probably means the person who has
retained the barrister’s instructing solicitor.
Disclosures must also be made to any
“associated third party payer”.
A barrister retained by a “law practice” has
only limited disclosure obligations.
3. What is a “law practice”?
Comprehends sole Does not comprehend a
practitioners and solicitor who is
partnerships of solicitors not carrying on practice
who in each case hold a on the solicitor’s own
current practising account, whether or not
certificate and practise the solicitor holds an
on their own account . unrestricted practising
4. A Barrister Retained by a
Need only give limited initial disclosure to
the law practice: s 309(2), 308, 313.
Need only give limited progress reports
where requested by the law practice: s
May have to give “the client” costs
information if the barrister negotiates
settlement of litigation: s 312(1), r 81 .
May have to make ongoing disclosure to
“the client”: s. 315.
5. Initial Disclosure
The solicitor must disclosure to the client the
barrister’s costs under s 309(1):
s 308 (1)(a): Whether any scale of
costs applies to any of the costs .
s 308(1)(a): The basis on which legal
costs will be calculated (including
details of any uplift fee: s 313(1) .
s 308(1) (c): An estimate of the total
legal costs if reasonably practicable.…
6. Initial Disclosure
The Solicitor must disclosure to the client the
barrister’s costs under s 309(1)
s 308(1)(c): If an estimate of the total
legal costs is not reasonably practicable
a range of estimates of the total legal
costs, and an explanation of the major
s 308(1)(d): Details of the intervals, if
any, at which the client will be billed.
7. Initial Disclosure
Under s 309(2), the barrister must
disclose to the instructing solicitor only
the information “necessary” to enable
the solicitor to disclose that s 309(1)
information about the barrister’s costs.
8. Initial Disclosure
In some cases, the only details required
of the barrister by s 309(2) may be the
barrister’s rates or standard fees
(including any uplift fee), terms relevant
to costs (e.g., any cancellation fee or
disbursements), and billing intervals .
9. Initial Disclosure
But barristers generally should give
their solicitors more rather than less
information about their costs .
10. Progress Reports
The barrister must respond to the instructing solicitor’s
request for information necessary to enable the solicitor to
comply with the client’s request for:
s 317(1)(a): A s 317(1)(b): A
written report of the written report of the
progress of the legal costs incurred
matter; and by the client since
the last bill .
11. Disclosure on Settlement
of Litigious Matters
Under s 312, the lawyer who negotiates
the settlement must disclose:
A reasonable estimate of the legal costs
payable by the client, including those of
another party payable by the client
A reasonable estimate of any
contributions towards those costs likely
to be received from another party
12. Disclosure on Settlement
of Litigous Matters
The barrister must disclose his or her
costs, and the instructing solicitor must
respond to the barrister’s request for the
other necessary information: LPR, s 81(2) –
Section 312 literally obliges the barrister
to disclose “to the client” all of the
The barrister should at least ensure that
the instructing solicitor provides all the
information to the client on the barrister’s
13. Ongoing Obligation to
Section 315 obliges a “law practice”
to disclose in writing “to the client”
any substantial change to anything
included in a previous disclosure.
It is unclear whether this applies to
a barrister retained by a law
The barrister should disclose in
writing to the instructing solicitor
any such change.
14. Exceptions for
A barrister retained on But if the barrister
behalf of a negotiates a settlement
“sophisticated client” by of a litigious matter for
a law practice is not a “sophisticated client”,
required to give initial the barrister must
disclosure, progress provide the s 312 costs
reports, or (if there was disclosure.
no initial disclosure) any
15. Exceptions for
A large range of “sophisticated clients”
is identified in ss 311(1)(c).
A “law practice” and an “Australian legal
practitioner” are “sophisticated clients”:
But a barrister’s instructing solicitor is
probably not a “client” and therefore
not a “sophisticated client”.
16. Barristers’ Cost Agreements
Costs agreements may be made between:
s 322(1)(a): “ a client and a law
practice retained by the client; or”
s 322(1)(b): “a client and a law
practice retained on behalf of the
client by another law practice; or”
17. Barristers’ Cost Agreements
s 322(1)(c): “a law practice and
another law practice that retained that
law practice on behalf of a client; or”.
s 322(1)(d): “ a law practice and an
associated third party payer” .
18. Barristers’ Cost Agreements
Barristers retained by a law practice ordinarily
should enter into a costs agreement with the
instructing solicitor under s 322(1)(c).
First, barristers will need to enter into a costs
agreement to become entitled to recover the
barrister’s agreed costs, instead of being
relegated to an assessor’s decision.
Secondly, barristers ordinarily need to ensure
that the instructing solicitor is personally
liable to pay the barrister’s costs.
19. Barristers’ Cost Agreements
The costs agreement should include at least:
The information the barrister is obliged
to disclose: s 309(2).
A provision rendering the instructing
solicitor personally liable for the fees,
regardless whether the client has put
the instructing solicitor in funds.
Terms of payment.
20. Barristers’ Cost Agreements
Other possible provisions include:
s 321 and regulation 82: Provision for interest on
s 303(1)(c)(i) and (2)(a), (3): A choice of law
clause – but these provisions contemplate such
clauses in agreements with “the client”.
s 344: A “sophisticated client” may contract out of
division 7, which concerns costs assessment,
including possible referral for disciplinary action for
excessive costs: s 343. It is unclear whether such a
clause in a barrister’s costs agreement with a solicitor
21. Barristers’ Cost Agreements
Some clauses are ineffective
s 322(5): Contracting out of costs
assessment under division 7, otherwise
than by sophisticated clients .
s 323(2): Conditional costs
agreements about criminal law or family
law matters …
22. Barristers’ Cost Agreements
s 324(4):Uplift fees exceeding 25% of
the legal costs excluding disbursements.
s 325: Contingency fees and the like.
s 347: (Ordinarily) provisions
exceeding the prescribed maximum
payment for speculative personal injury
A costs agreement must be either written or
evidenced in writing: s 322 (2).
That requirement is fulfilled (except for a
“conditional costs agreement”) by a written
offer that is accepted either in writing or by
other conduct, so long as the offer complies
with s 322(4) .
A conditional costs agreement ordinarily must
comply with the more detailed requirements
of s 323 (but see s 323(4)).
24. Void Costs Agreements
A costs agreement made in
contravention of division 5 is void.
Costs are then limited to the applicable
scale of costs or assessment: s 327.
If a costs agreement includes a
prohibited contingency fee no costs are
recoverable: s 327(5).
25. Setting Aside Costs Agreements
and Assessments of Costs
On application “by a client” or “associated third
party”, the Supreme Court may order that a costs
agreement be set aside if satisfied the agreement is
not fair or reasonable: ss 328(1), 322(6).
But a law practice which retained and made a costs
agreement with a barrister is not given any right to
apply for that agreement to be set aside.
Therefore, a barrister’s costs calculated pursuant to a
costs agreement made in conformity with LPA after
proper disclosure should be assessed by reference to
the costs agreement: ss 336, 340.