Legal costs adjudicated by new office reduced by 34% for litigants
New clearer and online procedures working to reduce time and costs.
First few months of process have seen a leap forward in modernisation process.
Welcome from Courts Service CEO for the work of modernisation of the Office of the Legal Cost Adjudicator
29th October 2020. The first annual report of the Office of the Legal Cost Adjudicator is published today. The report shows a big investment of time and effort in modernising the approach and procedures adopted in assessing disputed costs following court cases. The report also provides interesting statistics regarding the areas of law and litigation where these assessments of costs are typically sought.
Established in October 2019 the Office, in its first three months of operation, achieved much by :
- introducing online filing of applications for adjudications. A major time saver.
- establishing and publishing clearly laid out procedures and principles for how costs are adjudicated.
- holding information seminars to introduce its new approach and mechanisms to the professions – at which over 45 professionals attended. Staff training on the new systems also took place.
- modernising and extending the physical and IT infrastructure available to add to the efficiency and efficacy of the approach to adjudicating costs – including an extra hearing space, and online access.
- establishing a register of its determinations online, to allow an understanding of the approach of developing principles in relation to adjudicating legal costs.
- processing over 600 cases inherited at its establishment and has adjudicated costs in the region of €9 million
- settling 62% of cases costs, following processing by the office, 10% were adjudicated upon or are awaiting determination, and 28% remained adjourned
- reaching settlements in cost of €47.5 million, the office adjudicated in €9 million of costs, and €33 million remained adjourned.
- reducing costs - costs determined by the Adjudicator were reduced by 34% from €9 million to €5.9 million – a saving of €3.2 million to those involved in the cases.
- 64% of costs were allowed whilst 36% were altered.
Welcome and Praise for the Work new Office
Angela Denning, Chief Executive Officer of the Courts Service, welcomed the annual report 2019 and the strategic plan 2020-2023 of the Office of the Legal Costs Adjudicator, prepared by Mr. Paul Behan, Chief Legal Cost Adjudicator.
Ms. Denning said that “great credit is due to Mr. Paul Behan, Chief Legal Cost Adjudicator, and his staff, in setting up the new office and preparing these two important documents. Paul and his team have worked very hard to establish improved processes to replace the old taxing masters systems and they are now making a very significant contribution to providing clarity to litigants on the subject of legal fees. On behalf of the Courts Service, I would like to congratulate Paul and his team for their hard work and look forward to supporting them in their important roles in the future”.
Background
The Office of the Legal Costs Adjudicators was established on 7th October 2019 with the abolition of the Office of the Taxing Master, when Part 10 and Schedule 1 of the Legal Services Regulation Act, 2015 were commenced following the enactment of the Legal Services Regulation Act 2015 (Commencement of Certain Provisions) (No.2) Order 2019 (S.I. No. 502 of 2019).
The Office of the Legal Costs Adjudicators, in addition to having the previous powers of the Taxing Masters, deals with disputes on legal costs between parties involved in litigation in the Superior Courts and other matters, such as disputes relating to costs between a legal practitioner and their client.
The statutory powers, functions and duties of the Office, derived from the Legal Services Regulation Act, 2015, are underpinned by the Rules of the Superior Court (Costs) 2019, which came into effect on 3rd December 2019.
602 cases transitioned from the Office of the Taxing Master to the Office of the Legal Costs Adjudicator, and up to the end of 2019, 374 cases were settled, 60 were determined and 168 were adjourned. 26 determinations were published on the Register of Determinations during the reporting period.
Part of a More Transparent Legal Costs Regime
Following the commencement of the relevant provisions on 7th October 2019, a range of legal costs transparency and reform measures have come into operation under Part 10 of the Legal Services regulation Act 2015. These make extensive provision for a new and enhanced legal costs regime that will bring greater transparency to how legal costs are charged by legal practitioners.
- Legal practitioners, whether solicitors or barristers, are obliged to provide more detailed information about legal costs from the outset of their dealings with clients.
- This will be in the form of a Notice, written in clear language, which must be provided when a legal practitioner takes instructions (a Section 150 Notice).
- Among other things, the Notice must disclose the costs that are involved, or, where this is not known, the basis upon which such costs are to be calculated.
- A cooling-off period is to be allowed for the consideration of costs by the client.
When there are any significant developments in a case which give rise to further costs, the Act provides that a client must be duly updated and given the option of whether or not to proceed with the case in question.
In addition, it is no longer permissible for legal practitioners (i.e. solicitors or barristers) to set fees as a specified percentage or proportion of damages payable to a client from contentious business or for barristers to charge junior counsel fees as a specified percentage or proportion of Senior Counsel fees.
An aggrieved client also has the option of applying for the adjudication of disputed legal costs by the modernised Office of the Legal Costs Adjudicators.
The Act sets out, for the first time in legislation, a series of Legal Costs Principles that enumerate the various matters that shall be taken into account in the adjudication of disputed legal costs by the Adjudicators. The Act also provides for the establishment of a publicly accessible Register of Determinations which is now in operation and discloses the outcomes and reasons for decisions made by the Adjudicators. County Registrars will maintain a similar register.
The Act also introduced a system for processing more minor disputes about excessive costs, which will be the subject firstly of informal resolution attempts in conjunction with the Legal Services Regulatory Authority, but will then escalate to formal resolution where alternative dispute resolution may not succeed.
This can help avoid the monetary and other burdens on a consumer or enterprise which can otherwise arise under a formal taxation of costs procedure. The charging of legal fees that are grossly excessive will be considered a matter of professional misconduct.
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Both docs have been published in PDF format
Download the Annual Report 2019
Download the Strategic Plan 2020 - 2023