Costs Agreement voided due to deficient disclosure of uplift fee

Carter Capner Law v Clift & Ors [2020] QCA 125

PROFESSIONS AND TRADES – LAWYERS – REMUNERATION – COSTS AGREEMENTS – OTHER MATTERS

The Appellant Law firm appealed against the Orders of Bond J declaring the Costs Agreement entered between the Law firm and the Respondents to be void and that itemised accounts being prepared in respect to the matter. The Costs Agreement was entered in respect to a Personal Injuries Claim. While the Costs Agreement was a standard personal injuries Costs Agreement, the major contention was the treatment of Care and Consideration and uplift fee.

Costs Agreements

From the obiter it is difficult to establish what the court is referring to however the Costs Agreement appeared to contain clauses relating to Care and Consideration and the Uplift fee. Clause 25 stated that “In addition to an amount that is to be allowed under the above Items, a further proportion thereof to reflect the solicitor’s care, consideration, skill and conduct of a proceeding or transaction that is considered by an independent costs assessor to be reasonable having regard to the matter including, for example” which would be interpreted as Care and Consideration, however there was apparently an additional clause “PROVIDED THAT where a fee/cost payment deferral or no-win no-fee arrangement applies, the further allowance must be not less than 15% of the aggregate of all time based Items performed.” (In CCL’s costs agreements with the other respondents 20 per cent is specified instead of 15 per cent.)” which was interpreted to be an Uplift fee. The Court upheld Douglas J decision that the that the Costs Agreement was void as the Costs Agreement contained an uplift fee and that the breached section s 324(3) of the Legal Profession Act 2007 as it did not contain and an estimate of the uplift fee; nor a range of estimates of it together with the variables that might affect its calculation

Itemised Bill

The Appellant also appealed the decision of the it provide an itemised accounts. The major issue in contention was whether itemised accounts were requested in the first place. It is noted that the file was transferred from Appellant to the Respondent’s current Solicitors when the Solicitor who had conduct of the file change practices. As is normal practice the parties entered into a deed to transfer the file subject to the payment of fees at the conclusion of the matter.

The Respondent made a request to the Appellant for a Report on the progress of the matter and legal costs incurred to date under s317(1) of the Legal Profession Act 2007. The Court accepted the Appellant’s submissions that the request for a report was not a request for an itemised bill. The Appellant also contented that Report can not be provided as they can not provide a report as to the conduct of the claim as they no longer represent the Respondent . Accordingly no such report, neither an itemised bill was prepared. The Court also rejected the Respondent’s arguments that an itemised bill was required to settle the claims, nor that the preparation of same would be trivial exercise. Accordingly the Orders made requiring the Appellant to provide itemised accounts as overturned. The Court did not address the issue in respect to Fees being assessed on the Scale as the Costs Agreements were declared void.