Victorian Consolidated Legislation

Legal Profession Act 2004 - SECT 3.4.32.

Setting aside costs agreements

3.4.32. Setting aside costs agreements



(1) On application by a client, the Tribunal may order that a costs agreement
be set aside if satisfied that the agreement is not fair or reasonable.

(2) In determining whether or not a costs agreement is fair or reasonable, the
Tribunal may have regard to any or all of the following matters-

   (a)  whether the client was induced to enter into the agreement by the
        fraud or misrepresentation of the law practice or of any
        representative of the law practice;



   (b)  whether any Australian legal practitioner or Australian-registered
        foreign lawyer acting on behalf of the law practice has been found
        guilty of unsatisfactory professional conduct or professional
        misconduct in relation to the provision of legal services to which the
        agreement relates;

   (c)  whether the law practice failed to make any of the disclosures
        required under Division 3;

   (d)  the circumstances and conduct of the parties before and when the
        agreement was made;

   (e)  the circumstances and the conduct of the parties in the matters after
        the agreement was made;

   (f)  whether and how the agreement addresses the effect on costs of matters
        and changed circumstances that might foreseeably arise and affect the
        extent and nature of legal services provided under the agreement;

   (g)  whether and how billing under the agreement addresses changed
        circumstances affecting the extent and nature of legal services
        provided under the agreement.

(3) The Tribunal may adjourn the hearing of an application under this section
pending the completion of any investigation or determination of any charge in
relation to the conduct of any Australian legal practitioner or
Australian-registered foreign lawyer.

(4) If the Tribunal orders that a costs agreement be set aside, it may make an
order in relation to the payment of legal costs the subject of the agreement.



(5) In making an order under subsection (4)-

   (a)  the Tribunal must apply the applicable scale of costs or practitioner
        remuneration order (if any); or

   (b)  if there is no applicable scale of costs or practitioner remuneration
        order-the Tribunal must determine the fair and reasonable legal costs
        in relation to the work to which the agreement related, taking into
        account-

   (i)  the seriousness of the conduct of the law practice or any Australian
        legal practitioner or Australian-registered foreign lawyer acting on
        its behalf; and

   (ii) whether or not it was reasonable to carry out the work; and

   (iii) whether or not the work was carried out in a reasonable manner.

(6) In making an order under subsection (4), the Tribunal may not order the
payment of an amount in excess of the amount that the law practice would have
been entitled to recover if the costs agreement had not been set aside.

(7) For the purposes of subsection (5)(b), the Tribunal may have regard to any
or all of the following matters-

   (a)  whether the law practice and any Australian legal practitioner or
        Australian-registered foreign lawyer acting on its behalf complied
        with this Act, the regulations or the legal profession rules;

   (b)  any disclosures made by the law practice under Division 3, or the
        failure to make any disclosures required under that Division;



   (c)  any relevant advertisement as to-

   (i)  the law practice's costs; or

   (ii) the skills of the law practice or of any Australian legal practitioner
        or Australian-registered foreign lawyer acting on its behalf;

   (d)  the skill, labour and responsibility displayed on the part of the
        Australian legal practitioner or Australian-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.

(8) The Tribunal may determine whether or not a costs agreement exists.

(9) The Tribunal may order the payment of the costs of and incidental to a
hearing under this section.

(10) In this section-

client means a person to whom or for whom legal services are or have been
provided. Note See also section 3.4.26(6) which extends the application of
this section to associated third party payers.



Division 6-Billing