You have just received a legal bill that you cannot understand. How do you know if your legal fees are fair?
Whenever someone needs a lawyer, one of their most important concerns is the amount of legal fees that they are going to be charged. This is a very legitimate concern bearing in mind that for the average person hiring a lawyer is one of the most expensive services they may ever engage.
So what do you do if you find yourself in this situation and don’t know whether or not the legal fees you have just been charged are fair and reasonable?
A very good tip is to ask your lawyer whether or not their legal fees are determined entirely by them or whether they engage the services of an independent cost assessor. If the latter, the legal cost assessor will ensure you are charged only for work appropriate to the progress of your legal matter.
Also, if your lawyer issues you with a bill that you think is excessive, you have the right to ask the lawyer to have the bill assessed by an independent cost assessor. Bear in mind however, that you may end up paying the independent legal cost assessor’s fees if the assessor deems the law firm’s legal bill to be fair and reasonable.
How are fees calculated?
Prior to the conclusion of your matter, your law firm will calculate their fees which will include costs for professional services and expenses (often called ‘disbursements’ or ‘outlays’).
Disbursements cover external expenses including medical reports and court fees. The law firm will also charge for phone calls, faxes, photocopies, emails, postage etc.
Law firms often charge for their time in 6 minute units, so it is important to note that if your lawyer says he or she charges $300 per hour, and they charge in 6 minute units this amounts to $30 per unit of time. Therefore, even if a telephone conversation with your lawyer lasted only 2 minutes, you will be charged for a 6 minute unit. Whilst this may seem unfair, this is to cover the additional time of the lawyer retrieving and returning your file and completing a file note of the conversation between you and your lawyer.
For certain matters, your lawyer may charge a fixed fee e.g. Conveyancing, or drafting a will or a power of attorney. So remember to ask your lawyer at your very first consultation how they charge.