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Clients disputing out of time bills – are they really out of time?

Charles Galayini | Wednesday, July 12, 2017
Clients disputing out of time bills – are they really out of time?

The issue of out of time bills being subjected to Costs Assessments has again reared its ugly head. Despite clear guidelines that clients have a 12 month timeframe in which they must dispute a bill, the Supreme Court has yet again considered a request for an itemised bill well outside the prescribed timeframe in the recent case of Lukic v De Luca – Leonard (2017).

As in Markoviak v Hagipantelis and Le v Brydens Lawyers Pty Ltd, the Court decided that S.728 LPA 2004 applied to give the court a wide discretion to order that a bill of costs be provided to the client by the solicitor.

The facts were that the solicitor De Luca – Leonard received instructions from Lukic in May 2010 to run a worker’s compensation case resulting from alleged bullying. A costs agreement was signed on 14th March 2011. The client Lukic was assessed at 60% WPI entitling her to work injury damages. At mediation on 2 April 2014 the matter was successfully settled with the client receiving $300,000. On 22nd April 2014, the solicitor rendered a lump sum bill of $74,000 for costs and disbursements.

The client changed solicitors and on the 31 March 2016 sought to have a bill of costs prepared alleging overcharging.

After a 3 day trial, the court found in favour of the client ordering the solicitor to prepare a bill of costs and finding that the 2004 Act applied and therefore S.728 LPA 2004 applied.

The question of costs is yet to be resolved although the only issue will be whether the solicitor will be ordered to pay party/party costs or indemnity costs.

It is hard to envisage how much, if any, of the costs the solicitors recovered from a successful case finalised in 3 years earlier, will remain with her after Supreme Court Proceedings, orders for costs and the costs assessment have been completed. This of course will not take into account the trauma and aggravation those proceedings will have taken on the solicitor, not to mention the productive work she would have done rather than the time spent on defending the Supreme Court Proceedings.

By John Andriano, Andriano & Associates, Accredited Specialist Personal Injury Law

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