HOW MUCH WILL A LAWYER COST?
In the event you find yourself in legal trouble you may be concerned that consulting a lawyer will mean spending a fortune on legal costs.
However, that’s not usually the case and often legal services are more affordable than you anticipate. Many legal services, especially common ones related to things like traffic offences, contracts, probate and property, are very competitively priced. Here’s some information about how lawyers charge to assist you when seeking legal advice.
A lawyer should at all times be transparent about what they’re going to charge you for legal services. They should also offer you a ‘costs agreement’ upfront, and answer any questions you have about the nature of the costs and when fees must be paid.
In the legal profession, the term ‘costs’ generally refers to the fees and other expenses a solicitor charges a client for their expertise and other payments that arise out of the provision of legal services, such as court fees.
Costs are one of the most heavily regulated aspects of practising law. Solicitors owe many duties to their clients, such as the duty to disclose and to ensure that legal costs are fair and reasonable.
When it comes to how lawyers charge, there are a couple of options. The most common way is for lawyers to charge by the hour. If this is how your lawyer proposes to charge, it’s in your interest that they work fast while at the same time maintaining high standards.
This way of charging is often called, in lawyer-speak, billable hours. The billable hour system is the traditional method of charging in the legal industry and is still the most popular today.
In simple terms, it describes a charging method by which a lawyer records how they spend every minute of their working day to determine how much they bill the client. Traditionally, many firms have insisted that lawyers record their billable hours as six-minute increments.
Under this method, junior lawyers bill a less than senior counterparts at a firm whether it’s for formal legal advice or behind-the-scenes tasks that are undertaken. Either way, for a lawyer to bill you for their time, the work must be directly related to your matter.
Lawyers can also charge using a fixed-fee structure and this is becoming more common. The upside of a fixed fee agreement versus the hourly billing method is that you have more certainty about what you’ll end up paying. For that reason it’s increasingly popular for ‘off-the-shelf’ legal services such as wills, divorce applications, lease agreements and contracts.
Fixed fee arrangements are less common in the context of litigation because of the uncertainties related to durations of proceedings. For instance, in litigation the parties may ultimately resolve a dispute via mediation or a settlement, or take the matter to a trial.
When it comes to the structure that’s used some lawyers will get you to pay the entire fee upfront, while others may allow you to pay in stages. If you go down this path it’s a good idea to make sure there’s a cap on the total amount payable.
Disputes about legal fees
In the event that you don’t agree with what your lawyer has charged, you should ask for an itemised bill then attempt to negotiate a lower price if you still disagree.
If you are unable to resolve the dispute informally and still want to contest the bill you can seek to get it assessed in NSW via the Office of the Legal Services Commissioner.
More information about costs agreements for readers in NSW can be found here.