Proposed changes to MAC Act costs regulations

23/06/2014

The Motor Accidents Authority (MAA) has provided the Bar Association with a draft set of amendments to the Costs Regulations applicable to claims under the Motor Accidents Compensation Act. The three critical features of the proposed changes are:

• A significant reduction in recoverable party/party costs under the regulations, with the maximum recoverable solicitor/client costs for professional fees to be capped at just over $20,000 in liability admitted cases and just over $30,000 in liability denied cases.

• The extension of the Costs Regulations to all claims, including exempt and litigated claims.

• Capping of solicitor/client costs at 50% of the regulated fee i.e. an additional $10,000 for liability admitted cases and an additional $15,000 for liability denied case. The net effect of the regulations is that the maximum that could be recovered for professional fees in any case, whether determined at CARS or in court, is just over $30,000 in liability admitted cases and just over $45,000 in liability denies cases.

There are additional allowances for medico-legal reports, some interlocutory disputes and appearance fees for CARS assessments and court hearings.

This represents a radical restructure of the current Costs Regulations. The Bar Association has serious concerns about the proposal, which cuts and restricts recoverable costs.

The removal of the capacity of lawyers to act for the injured will reduce access to justice and reduce the recovery of fair compensation for the injured.

The Bar Association is engaged in discussions with the MAA to express its opposition to these proposals. The document circulated is only a draft for discussion purposes. There is to be a further period of formal consultation with the association (as required under the Act) prior to any regulation being gazetted.

A link to the proposed regulation is here.