Fee recovery assistance

02/02/2009

The Bar Association assists members with recovery from solicitors of unpaid fees which have been outstanding for more than three months but less than two years.� The association will only assist members who have complied with the fee disclosure requirements of the Legal Profession Act 1987 or the_ Legal Profession Act 2004_.

Where members were first instructed in a matter on or after 1 October 2005 (when the LPA 2004 commenced operation), the provisions of Part 3.2 of the LPA 2004 apply. Where members were first instructed in a matter before 1 October 2005, the provisions of Part 11 of the LPA 1987 apply. �

Members should be aware that the disclosure obligations under the LPA 2004 are more onerous than under the LPA 1987 and that infringement of the LPA 2004 provisions may amount to professional misconduct or unsatisfactory professional conduct. �

Part 9 of the Legal Profession Regulation 2005 contains a number of provisions concerning costs disclosure and assessment with which members should be familiar. These provisions supplement Part 3.2 of the _Legal Profession Act 2004. _

Failure to comply with disclosure obligations can also attract adverse consequences in the fees recovery process.� Members who have not complied with the fee disclosure requirements of the relevant Act (either in full or in part) will not be able to maintain an action for recovery of their fees in the absence of obtaining an assessment of fees and determination from a costs assessor.� The cost of any such assessment must be borne by the member and cannot be passed on to the instructing solicitor.

Assistance will be provided in the following manner:

a) on being satisfied of the member’s compliance with the relevant Act, the Association will write to the solicitors requesting payment;

b) members are advised in writing if the Association’s efforts have been unsuccessful and the Association is of the view that further correspondence with the solicitors will be fruitless;

c) in the event payment is not forthcoming, the Association will suggest to the member that he/she retain a solicitor to advise on the most appropriate action to take to recover the fees.

The member may retain a solicitor of his/her choice or alternatively may retain one of the firms of solicitors the Association has placed on a list of solicitors who have indicated a willingness to undertake fee recovery work on behalf of members.

Three firms of solicitors have provided information to the association as to the manner in which they will charge if retained by members. The rates charged differ between those firms and in particular depend on the seniority of the solicitor undertaking the work. Details of the rates charged have been made available to clerks and are also available from the Bar Association’s Professional Conduct Department on ph: (02) 9229 1727 or via e-mail: pcd@nswbar.asn.au

Members will be required to contract directly with any firm of solicitors ultimately engaged whether that firm is one of the three included in the list referred to above or a firm of the member’s own choice. The association will not be responsible for any legal fees incurred by members nor does the association give any assurance in respect of the quality of the advice or service provided.�

Receipt of trust money by barristers: clause 106A Legal Profession Regulation 2005

Members’ attention is drawn to clause 106A in Division 9 of Part 8 of the Legal Profession Regulation 2005, which took effect from 1 July 2007. Clause 106A effectively replaces the former clause 178 which has been repealed. That clause permitted barristers to receive costs in advance.

Clause 106A must be read in conjunction with s252 (in Part 3.1) of the Legal Profession Act 2004.

Section 252 provides:

_252�� � Barristers not to receive trust money

A barrister is not, in the course of practising as a barrister, to receive trust money._

Clause 106A provides:

_106A Receipt of trust money by barrister (section 252 of the Act)—exclusion under section 246 (3) of the Act

Part 3.1 of the Act does not apply to trust money received and held by a barrister if the money is received by the barrister on account of legal costs for legal services in advance of the provision by the barrister of the legal services, in the following circumstances:

(a)� the barrister is practising as a sole practitioner and the money is received in connection with instructions accepted by the barrister directly from a person who is not a solicitor,

(b)� the money is deposited, within a reasonable time, after the barrister receives the money, in an account maintained with an ADI in connection with the barrister’s law practice,

(c)� the money remains deposited in that or another account maintained with an ADI in connection with the barrister’s law practice until:

���� (i)� a bill is given to the client, or ���� (ii)� the money is refunded to the client, or ���� (iii)� the money is paid to a solicitor who is later engaged by the client in the matter._ ** 3 February 2009**

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