Thursday 19 September 2019

Warning for lawyers as new fee rules set to come into force

President of the High Court, Mr Justice Peter Kelly. Photo: Damien Eagers
President of the High Court, Mr Justice Peter Kelly. Photo: Damien Eagers
Shane Phelan

Shane Phelan

Lawyers have been warned they could face sanctions if they do not comply with long-awaited legal costs transparency rules being introduced next month.

The new rules are one of a number of reforms finally being introduced in the legal services area in October - almost four years after legislation allowing for them was signed into law.

Other changes are a new public complaints system and a new office to decide on legal costs disputes.

In a statement to the Irish Independent, the Department of Justice confirmed the new costs transparency obligations will apply from early next month and that the Legal Services Regulatory Authority (LSRA) plans to bring the complaints system into operation from October 7.

In recent weeks solicitors have been warned by the Law Society of the need to prepare for the new legal costs rules. In a guidance document for its members, the society said breaches of the regulations may constitute misconduct and lead to LSRA sanctions.

Obligations

It remains to be seen if the new rules will help drive down legal costs. At a minimum, it is hoped they will ensure clients make more informed choices and avoid being hit with unexpected bills.

The key change is that solicitors will face greater obligations to let clients know legal costs that can be incurred in any given matter. This must be done using what is known as a Section 150 notice.

According to the guidance document, the new rules go much further than previous obligations.

Solicitors will be required, as soon as reasonably practicable, to give the client a notice setting out the legal costs that will be incurred.

Where this is not possible at the outset, the notice must set out the basis on which costs will be calculated.

The society said many matters will require a minimum of two Section 150 notices and some will require many more.

If a solicitor becomes aware of a factor which would be likely to make the legal costs significantly higher than originally indicated, they will be required to provide the client with a new notice.

Meanwhile, the LSRA is seeking applications for lay membership of its complaints committee.

Although the authority came into being in October 2016, it first had to prioritise other areas of its remit before turning its attention to setting up a new complaints mechanism.

The committee will be made up of lawyers and lay members, but will always have a lay majority.

They will consider and investigate complaints against legal practitioners and can refer serious matters to a new Legal Practitioners Disciplinary Tribunal, which will sit in public.

This will see the gradual phasing out of the current system in which complaints are dealt with by the Law Society, the Solicitors Disciplinary Tribunal and the Barristers' Professional Conduct Tribunal.

According to the department, next month will also see the transition of the existing Office of the Taxing Master to that of the new Legal Costs Adjudicator. Unlike its predecessor, the new office will publish a register of its decisions.

It is hoped this will assist in consumer awareness of the going rate for certain types of legal work.

The changes are being introduced at a time when the cost of litigation is being considered as part of a wide-ranging review of civil justice led by the President of the High Court, Mr Justice Peter Kelly.

Last year he raised the prospect of a cap on fees, saying litigation in the High Court was potentially ruinous for someone on a middle-class salary.

He said one possible solution was for a judge to make an assessment that a trial should take no more than a certain number of days and that costs would not be allowed to exceed a specified amount.

Irish Independent

Editor's Choice

Also in Irish News