Guidelines for consideration of applications to be paid more than 50% of the net damages in a speculative personal injuries matter
Section 347(1) of the Legal Profession Act 2007 provides that the maximum amount of legal costs (inclusive of GST) that a law practice may charge and recover from a client for work done in relation to a speculative personal injury claim must be worked out under the costs agreement with the client for the claim or this Act but in no case can those legal costs be more than the amount worked out using the formula—
[E– (R+D) ] × 0.5
- means the amount to which the client is entitled under a judgment or settlement, including an amount the client is entitled to receive for costs under the judgment or settlement.
- means the total amount the client must, under an Act, a law of the Commonwealth or another jurisdiction, or otherwise, refund on receipt of the amount to which the client is entitled under the judgment or settlement.
- means the total amount of disbursements or expenses for which the client is liable if that liability is incurred by or on behalf of the client either by the law practice or on the advice or recommendation of the law practice, in obtaining goods or services (other than legal services from that law practice) for the purpose of investigating or progressing the client’s claim, regardless of how or by whom those disbursements or expenses are paid, but does not include interest on the disbursements or expenses.
Section 347(2) of the Act provides that If—
(a) the amount of legal costs that a law practice may charge and recover from a client is more than the amount calculated under subsection (1); and
(b) the law practice wishes to charge and recover the amount (the greater amount) from the client;
the law practice may apply under subsection (3) for approval to charge and recover the greater amount.
Applications to be paid a greater amount must be made in writing to the Society. Factors that will be taken into account by the Society when considering an application are set out in the policy document below.