QCAT finds no fault with disputed costs agreement

In a recent decision of the Queensland Civil and Administrative Tribunal, an application to have a costs agreement set aside under s328(1) Legal Profession Act (LPA) was dismissed.

In Ashney v Pippa Colman & Associates Law Practice Pty Ltd [2022] QCAT 281, the tribunal was not satisfied that the costs agreement was not fair and/or reasonable.

Facts

The applicant was a former client of Pippa Colman & Associates in a family law matter. A cost estimate of $5000 to $10,000 was provided to the client initially, and the client deposited $10,000 into the firm’s trust account at the commencement of the matter.

Services were provided pursuant to the costs agreement, and the practitioner issued an invoice for $10,805.33 for the period of April to May. The practitioner then subsequently issued three invoices¹ in the months that followed, which were disputed by the applicant.

The client alleged she was induced to enter the costs agreement and had not received adequate costs disclosures.

The costs agreement specified:

• an estimate of anticipated fees and costs of between $5000 and $10,000
• that the respondent would charge legal fees on a “blended scale”, including government set fees and a time basis for meetings in accordance with hourly rates
• the scope of work “so far” included representing the applicant in court proceedings, up to the first interim hearing and representing the applicant in negotiations with the other parent and their lawyer up to and prior to the directions hearing
• the basis upon which the agreement could be terminated, including that the applicant would be required to pay the respondent’s professional fees and costs up to the date of termination.²

Findings

The tribunal determined:

• The communications from the practitioner adequately addressed changes in circumstances.
• The costs agreement and “revised estimate” letters provided detailed information consistent with the respondent’s obligations under the LPA provisions for costs disclosure.
• The approach of the practitioner in advising in the costs agreement of the process of engaging a costs assessor, and then following that course at no extra cost to the client³ prior to provision of the itemised bill, was appropriate.⁴

Orders

The tribunal was not satisfied the costs agreement, as supplemented by the revised fee estimate letters, was not fair and/or reasonable to the applicant. The application was dismissed.

Practitioner’s comments

The practitioner noted the following:

• her position was supported by taking thorough file notes during the first interview with the client
• she was very specific and detailed in the scope of work
• she kept revising the scope of work and costs estimates with the client
• litigating with a client is an arduous process both in terms of lost billable hours and stress.

Grace van Baarle is the Manager and an Ethics Solicitor in the QLS Ethics and Practice Centre Sarah Millar is a Law Clerk in the QLS Ethics and Practice Centre.

Footnotes
¹ Ashney v Pippa Colman & Associates Law Practice Pty Ltd [2022] QCAT 281, [9].
² Ibid, [6].
³ Ibid, [220].
⁴ Ibid, [203]-[206].