By Lawyers are preparing for the Legal Profession Uniform Law in Western Australia
Legal Profession Uniform Law (LPUL) is due to commence in Western Australia on 1 January 2022.
By Lawyers guides and precedents will be updated so that subscribers in WA will be compliant from commencement.
The WA provisions are contained in the Legal Profession Uniform Law Application Bill 2020 (WA) which will replace the Legal Profession Act 2008 and the Law Society Public Purposes Trust Act 1985 on commencement.
Simplified and standardised regulations for WA legal practitioners will align with those in New South Wales and Victoria. The Uniform Law is governed by the Legal Services Council and the office of the Commissioner for Uniform Legal Services Regulation. Each participating jurisdiction has a representative on the council which sets the rules and policy underpinning the Uniform Law. The Commissioner oversees dispute resolution and compliance functions.
The WA Legal Services and Complaints Committee and the Legal Practice Board will continue to carry out complaint and investigation functions, the granting of practising certificates, and professional development.
Costs disclosure and billing under the LPUL
While the Uniform Law makes sweeping changes, those which impact day to day practice the most relate to costs disclosure and billing.
Written costs disclosure must be given when instructions are taken or as soon as reasonably practical after. It must include the basis on which costs will be calculated and an estimate of the total costs. It must be updated if there is any significant change.
The client must be informed of their rights to negotiate a costs agreement, receive a bill, request an itemised bill, negotiate the billing method and the availability of costs determination.
If a law practice fails to meet its disclosure obligations, then any cost agreement with the client is void and the client is not required to pay the legal costs. The firm cannot commence or maintain any proceedings for recovery of legal costs until they have been assessed, or the dispute is determined by the Legal Practice Board. A contravention can also result in disciplinary action.
Firms must take all reasonable steps to ensure the client has understood and given consent to the proposed conduct of the matter and the proposed costs.
Disclosure obligations vary depending on the estimated costs in a matter. Disclosure is not required if costs are not expected to exceed $750 excluding GST and disbursements. Where costs are not expected to exceed $3000 excluding GST and disbursements, the prescribed uniform standard disclosure form can be used.
Billing under the LPUL
A bill may be lump sum or itemised. A client who receives a lump sum bill may request an itemised bill. The request must be made within 30 days after the date on which the legal costs became payable and must be complied with within 21 days after receiving the request.
If the costs in an itemised bill are higher than the a lump sum bill, the additional costs will only be recoverable where the client was told that the costs in any itemised bill may be higher – and the additional costs are determined to be payable after a costs assessment or binding determination.
Each bill or a covering letter accompanying each bill must be signed by a principal of the firm, or nominate a principal as responsible for the bill.
A law practice must not charge for the preparation or delivery of a bill.
Each bill must include or be accompanied by a written statement setting out the options available to the client in the event of a dispute about the costs and any time limits which may apply.
Interest can be charged on costs unpaid 30 days or more after a complying bill has been given. Interest can only be charged where the bill contains a statement that interest will be payable and the rate chargeable. The maximum rate is prescribed; currently it is 2% above the cash rate target specified by the Reserve Bank of Australia at the time the bill was given.
The billing provisions of the Uniform Law do not apply if the client is a commercial or government authority
Cost assessment procedure
The Uniform Law does not change the procedure for party / party cost assessments in Western Australia. The procedure and form for an assessment of costs is set out at rule 4.7 of the Consolidated Practice Directions of the Supreme Court.
By Lawyers guides:
All WA specific By Lawyers guides will be amended to cover the Legal Profession Uniform Law. So too will the relevant WA commentary and precedents in Federal guides and reference materials.
The main changes will include:
- New LPUL compliant costs agreements and short form costs disclosure for all WA guides, Federal guides including Family Law, Employment Law, Companies, Trusts, Joint Ventures and Superannuation.
- Updates to the 101 Costs Answers reference manual, which will also include the LPUL compliant costs agreements.
- Updates to the ‘Example invoice incorporating notification of client’s rights’ and the stand-alone ‘Notification of client’s rights’ precedents available on all WA and Federal matter plans.
- Updates to the commentary on professional executor regulations in the Probate and Letters of Administration guides.
- Updates to the costs section in the Wills commentary including the ‘Conflicts concerning practitioner’s own interests’ section and the ‘Solicitors as executors’ section.
- Updates to the WA trust accounting section in the By Lawyers Practice Management guide.
- Updates to 101 Costs Answers.
- Updates to the ‘Solicitor mortgages’ section in the Mortgages commentary.