Costs Revision Procedure Guidelines
Otago District Law Society
Introduction
This pamphlet has been published by the Otago District Law Society (ODLS) to provide information on the provisions of the Law Practitioners Act 1982 regarding formal revision by the Law Society of costs charged by a legal practitioner (lawyer).
If you have any queries about a bill of costs received from your lawyer then you should speak to them and discuss your queries and concerns.
If the bill is not detailed enough, or there are items in it which you are unsure of or unhappy about, then a discussion with your lawyer or with the office manager of the law firm which acts for you may assist in resolving matters.
Alternatively, you might wish to write to the law firm asking for a breakdown of the bill and setting out your queries and concerns.
Formal revision of a bill of costs from your lawyer
If however you do not wish to discuss the matter directly with your lawyer, or have discussed the bill with them or written to the firm about it and not received a satisfactory explanation for the amount of the bill or any items on it, then you may wish to consider making an application to the ODLS to have the bill formally revised under the Law Practitioners Act 1982.
This pamphlet sets out how to go about making an application to the ODLS for the formal revision of a bill of costs, and what that revision will involve.
Lawyers Bill of Costs
Formal revision of a bill of costs from your lawyer
Your lawyer is required to provide you with a written bill for any work done by them on your behalf.
If the lawyer holds funds on your behalf in their trust account, then they are entitled to deduct the amount of the bill from those funds, but if they do so they must provide you with a written statement setting out the bill of costs and showing that the amount of the bill has been deducted from trust account funds.
What the bill includes:
Costs
There is nothing set down by law governing how much lawyers can charge for their services however the New Zealand Law Society does prescribe Rules of professional Conduct for Barristers and Solicitors.
Rule 3.01 states as follows:
The charges by practitioners for all professional wok done shall be calculated to give a fair and reasonable return for services rendered, having regard to the interests of both client and practitioner. Such charges shall take account of all relevant factors and in particular:
The relative importance of the factors set out above will vary according to the particular circumstances of each transaction.
Disbursements
In addition to the lawyers costs the bill should set out in detail the disbursements paid by the lawyer on your behalf.
Disbursements include things such as Land Registry Office registration fees (charged by the Government for registering documents), Stamp Duty (charged by the IRD), filing fees (charged by the Court), postage and courier costs, toll and fax fees, Agency fees (fees charged by another lawyer for work done on your behalf, at your own lawyers request) and mileage.
Formal Revision of a Lawyers Bill of Costs
The purpose of a revision is for the ODLS to determine on your behalf whether the costs which you have been charged by your lawyer are fair and reasonable for the work done.
The Law Society carries out cost revisions free of charge, but note that in the event that a Revisions Hearing is required, costs may be awarded against either party.
Limitations on the formal revision of bills
The Law Practitioners Act 1982 ("the Act"), part VIII, sets out a procedure by which a lawyers bill of costs may be reviewed.
It also sets time limits within which a review may be applied for, and so it is important that any application to the ODLS for review of a bill of costs is made as soon as possible after the bill of costs is received.
The following is a summary of the limitations which the Act places upon the revision of bills by the ODLS:-
* A bill of costs can be revised by the ODLS automatically if:
a) it is less than 6 months since it was received by you, and
b) it has not been paid, or
c) it has been paid by way of a deduction of money held on your behalf in the lawyers trust account, or set-off against other money owed to you by the lawyer. (see Section 145 Law Practitioners Act)
* A bill of costs can be revised at the discretion of the ODLS if:
a) it is more than 6 months but less than 12 months since it was received by you, and
b) it has not been paid, or
c) it has been paid by deduction or set-off.
In order to have the ODLS exercise their discretion to allow the bill to be revised, you will need to write to the ODLS and satisfy them that there is a good reason for the delay in seeking the formal revision.
For example, the discretion may be exercised in you favour if you are able to show that the delay is as a direct result of you trying to resolve matters directly with your lawyer. (see Section 144 Law Practitioners Act)
* A bill of costs can be revised if the lawyer concerned agrees, where:
a) it is more than 6 months, but less than 12 months since the bill was received by you, and
b) the bill has not been paid, except by deduction or set-off (see Section 145(2)
* A bill of costs cannot be revised except by court order if
a) it is more than 12 months since the bill was received by you, and/or
b) it has been paid (unless by deduction or set-off) (see Section 146 Law Practitioners Act)
Note: If the bill is for any reason unable to be revised under the Law Practitioners Act, other remedies may still be available under the Consumer Guarantees Act, or the Disputes Tribunal.
Requesting a Formal Revision
Any request for a formal revision must be made in writing and addressed to:-
The Executive Director
Otago District Law Society
Private Bag 1901
Dunedin.
Your letter should set out the following:-
* the instructions which you gave to your lawyer
* the work that you understand to have been done by your lawyer for you
* the outcome of that work
* the reasons why you are disputing the bill
* details of any discussions that you have had with the lawyer concerning the bill
You should include with your letter:-
* a copy of the bill of costs
* copies of any letters you have written or received from the lawyer
Revision Procedure
Commencing the revision
When your request for revision is received by the ODLS, the Executive Director will write to you confirming this, and seeking any further details that the ODLS might need in order to start the Revision procedure.
If your request is subject to any of the limitations referred to above, and requires the consent of the lawyer concerned, the exercise of the discretion of the ODLS or a Court order, you will be advised of this and the Executive Director will explain the procedure which will be followed for such requests.
If your request for revision is one which can be dealt with automatically, when it is received the ODLS will write to the lawyer concerned advising of your request. The lawyer will be told the reasons for your request and may be asked to explain the amount of the bill. If the bill which you are querying is not a detailed one, the lawyer may be asked to provide an itemised bill of costs. Any comments which the lawyer makes in reply will then be sent to you together with the itemised bill of costs.
At this stage you may be contacted by the Convenor of revisions, who is an independent lawyer appointed by the ODLS to co-ordinate all requests for cost revision received by the Society. The Convenor may discuss the request with you with a view to getting further details of your concerns, and may also discuss these further with the lawyer.
If once you have received and considered the explanation and/or the itemised bill; you have discussed your concerns further with the Convenor of revisions, and you are satisfied that the bill is fair and reasonable, you should advise the Convenor and your request for formal revision will be discontinued.
If, however, at this stage you remain dissatisfied with the bill, then the revision will proceed to a formal hearing before a revisions panel.
Revisions Panel
The task of revising bills is delegated by he ODLS Council to independent members of the Society who will be lawyers experienced in the type of work which is the subject of the bill of costs being revised.
The Convenor of revisions will appoint a panel of two Revisers to conduct your revision hearing, and one of the two panellists will be appointed Chairperson of the panel. The Chairperson will write to you advising of the names of the two revisers, and of the time, date and place at which the revision hearing will be held. You are entitled to object to either of the revisers if they are known to you or you have other good reasons for doing so, and if the hearing date or time is unsuitable to you then it may be altered if this is necessary.
Attendance at the Revisions Hearing
Both you and the lawyer should appear at the Hearing, and bring with you ALL of the documents which you have which relate to the request for revision.
Whilst it is not compulsory, it is advisable for you to attend the hearing in order that you can hear what is said by the lawyer in relation to the bill, and so that you can ask and answer questions.
If you do not wish to, or are unable to attend, you may forward written submissions to be considered at the Hearing.
You may, if you wish, be represented by another lawyer at the Hearing. You are also entitled to bring someone else along for moral support, but please note that this person will not automatically have the right to speak on your behalf unless the Chairperson allows them to do so.
Procedure at the Revision Hearing
Note that the Hearing will be conducted in quite a formal manner, and that any questions that you have or matters that you wish to raise in the course of the Hearing will be required to be put through the Chairperson.
The following is the procedure which will be followed in most cases:-
Introductions
The Chairperson will introduce all parties, confirm that neither you nor the lawyer have any objections to the Revisors, and explain the procedure that will be followed in the course of the Hearing.
Submissions by Client
If you have forwarded written submissions, whether or not you are at the Hearing these will be considered at this time.
If you attend the hearing you will be asked to make any oral submissions you have at this time, including the reasons for your request for revision.
At this stage you should also submit any documents which you have brought with you that are additional to what is already on file.
At the conclusion of your submissions you should ask any questions that you might have to ask either the lawyer, or the Revisers.
Submissions by Lawyer
The same procedure is now followed as for the client above.
The lawyer makes their submissions, in addition to which they have the opportunity to reply to any new matters which were raised by the client in the course of their submissions.
Reply by Client
The client responds to the lawyers submissions.
Queries by Revisions Panel
The Revisers raise any additional queries that they might have after hearing the submissions.
Costs
Section 153 of the Act provides for the Revisers to make an order against either the lawyer or the client requiring them to pay all or part of the costs of the revision, as the reviser/s consider reasonable. (see Section 153 of the Act for further details regarding costs where the Revision is ordered by the Court)
Decision
The decision of the Revisions Panel may be either oral, given immediately after the conclusion of the Hearing, or written.
In most cases a written decision will be given by the Revisions Panel after the Hearing has concluded and they have given the matter further consideration.
You will receive this in the mail as soon as possible after the Hearing, and it will be accompanied by a letter from the Executive Director of ODLS certifying the amount which the Revisions Panel have decided is owing.
The Revisions Panel may order that the original bill of costs should remain unchanged, that it should be reduced, or that it should be completely disallowed.
The decision of the Revisions Panel is binding on both you, and the lawyer, and once you have received the decision you are obliged to pay the amount owing under the revised bill, if any.
Appeal
If you are dissatisfied with the decision you have the right to appeal the decision in the High Court.
If you want to appeal, you must do so by filing a written notice of appeal with the Registrar of the High Court within 14 days of the date of the decision.
The Registrar may allow an extension to the 14 day appeal period in certain circumstances. You will need to send a copy of the notice of appeal to the lawyer, and there will be a fee payable to the Court for filing the notice.
If you wish to consider filing an appeal, it is recommended that you contact the Registrar of the High Court in Dunedin (Ph (03) 477 8740) who will advise you of the procedure to be followed, and the filing fees that you will be required to pay.
Further Information
This pamphlet is intended as a general guide only, if you wish to know further details of the Law Practitioners Act 1982 it is recommended that you either take legal advice, or obtain a copy of the Act, which is available at any Bennetts Government Bookshop.
If you need more information about how the Cost Revisions procedure operates, you may write to or telephone the Executive Director of ODLS.