No Costs Agreement

The Legal Advisory Council has prepared a fact sheet on cost agreements, which is available on its website. For any legal question, regardless of its value, you must have a cost agreement with your client. Even if the case is likely to be less than $750 and you don`t need to provide a full cost statement, you still need to have a cost agreement. If you change law firms as part of your claim, both law firms may charge you a lawyer`s fee. Usually, the company that acts first will disclose your file to the second company with an agreement from you or the second company to pay its fees once the matter is settled. If you think your customer has a good chance of success, you can also specify a condition to pay an «increase fee.» This is an additional payment for a positive result, which must not exceed 25% of the process costs (excluding payments). Your cost agreement should clearly state how the fee will be calculated, what you expect from the fee, and what factors may change the final fee calculation. There are strict rules on how to deal with cost agreements. If you do not follow these rules, the contract may become invalid even if your client has accepted it. «No Win – No Fee» agreements are a type of what the Legal Profession Act, 2007 (the Act) calls «contingency cost agreements.» The law defines contingency cost agreements as agreements that provide that «the payment of some or all of the legal fees depends on the successful decision of the case to which those costs relate.» (See section 323 of the Law on the Legal Profession). You cannot have a conditional cost agreement in a criminal or family law case. The Commission considers that the rule should limit the total costs that the client must pay to both (or all) law firms that have been active in this case. How this ceiling is distributed among these companies can be negotiated commercially between them.

In most cases, this would mean that the amount would be divided proportionally between them, depending on the amount of work done by each company. A «no-win — no-cost» cost agreement gives people with limited finances the opportunity to access legal services to hire a lawyer on their behalf. In these types of agreements, the lawyer is only paid if the case is successful or after the case has been settled or otherwise decided. If you are unsure whether it is a not-for-profit or no-fee agreement, or information provided by the Commission des services juridiques, you should seek independent advice. Law firms usually don`t offer profit – no fee conditions only in cases where money is available or likely to be available to pay the costs once the problem is resolved. Some companies pay the expenses with their own money and withdraw them from the customer once the business is closed – usually with additional interest charges. When an interest rate is calculated, the interest rate must be indicated in the cost agreement. A «cost agreement» is part of your obligations to disclose costs to your client. It is the formal agreement between your law firm and your client that governs how you structure the cost of your work.

Many lawyers and law firms enter into «no-win — no-fee» cost agreements and will perform legal work on behalf of their clients, which is sometimes referred to as «speculative» (or «specification»). You won`t be able to charge your customer if they haven`t agreed to your cost contract. Some cost agreements may be accepted in writing or in some other way that clearly states that they accept them. If you propose a «conditional cost agreement» (i.B no win-win agreement at no cost), it can only be accepted in writing. The fees charged under a «no-fee win-no fee» cost agreement may be higher than those of a standard cost agreement between a lawyer and a client. Indeed, the lawyer runs the risk that the case will not succeed and that he will not be paid for his services. Although a law firm runs the risk of not being able to bill its work under a no-cost agreement, it is usually entitled to reimburse all expenses. .