Legal costs

Victorian couple agree on legal costs

This information relates to laws in Victoria, Australia.

The amount you pay for legal advice will depend on the type of problem you have and the experience of the lawyer you use.

Understanding how a lawyer charges

When you first meet with a lawyer you should ask what their fees are so there are no surprises.

A lawyer’s charges are made up of fees for professional services and disbursements. Disbursements are expenses paid for you by the lawyer, such as court fees for filing documents or paying a barrister’s fees.

In Victoria, lawyers must give you written information about costs if the fees are likely to be above $750. This is known as a costs disclosure statement. It explains their fees, and your rights as a client.

Even if the fees are under $750 you still have the right to request progress reports, reasonable information about costs and a bill.

If the total legal costs are likely to be more than $750, your lawyer must tell you how the legal fees will be calculated and give you an estimate of the total legal bill.

Where the legal costs are likely to be more than $750 but less than $3000, your lawyer can use a standard form to disclose them to you.

Your lawyer must always inform you about significant changes in costs.

What are costs agreements?

Some lawyers use a costs agreement. You have the right to request one. This is a contract with you about the fees you will be charged.

The costs of going to court

The cost of starting a court action and running a case can be high, even if you win. So, it is a good idea to try to sort the problem out without going to court.
See Mediation

Most courts have power to make orders saying who is to pay the legal costs of a case. They are known as cost orders.

If you lose a case you generally have to pay costs for both sides. But even if you win you will probably have to pay some, or all, of your legal costs.

Why do I have to pay legal costs if I win?

There are a number of reasons why it is likely that you will have to pay legal costs if you win:

1. If the court orders the other side to pay your costs, the amount you get back is worked out on scales of standard costs set by legislation. If your lawyer has done more work, or their rates are above the scale, you still only get back what the scale says. This means you will have to pay any gap.

2. In special circumstances the court can order indemnity costs. This means you get back all your costs as long as they are reasonable. But this only happens if the other side did something wrong during the case or if you made a reasonable offer early in the case and the other side did not accept it. Mostly you will not get an indemnity costs order.

3. If the person who lost the case has trouble paying, you might have to wait. But you still have to pay your own lawyer.

Before you settle a case your lawyer has to give you a reasonable estimate of all the costs you will have to pay.

Problems with lawyer’s fees

If you have concerns about your lawyer’s fees the best thing to do is to look at the costs disclosure or your costs agreement and then speak to your lawyer. It may be something that can be sorted out once the lawyer understands why you are not happy.

If the problem cannot be resolved or you feel you cannot speak to your lawyer, you can make a complaint to the Legal Services Commissioner.

1300 796 344
www.lsbc.vic.gov.au

For good information about legal costs and what you should ask a lawyer:

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This page was last updated on February 14, 2017