Queensland
Queensland law requires that all clients of law firms enter into a written client or cost agreement with the firm. This agreement clearly defines what the law firm will do for you and what it expects of you. Before you engage a lawyer, ask them to provide you with a copy of the agreement to review in advance, so you can check it in your own time. Remember that the law firm will be unable to progress your matter until it has the agreement signed.
In a ‘no win ‐ no fee’ costs agreement, a lawyer agrees with a client not to charge any fees for their services unless and until the client ‘wins’ their case. The lawyer agrees to take the risk that the client may lose their case and if this happens, the lawyer does not charge any fees. The client agrees to pay the lawyer if the case succeeds (typically, but not always, out of the money recovered from the other party).
This is what is known as operating on a ‘speculative’ or ‘spec’ basis. ‘No win ‐ no fee’ agreements are one type of what the Legal Profession Act 2007 (the Act) calls ‘conditional costs agreements’
However, remember that:
• the law firm is still entitled to recover their expenses (also known as outlays or disbursements) and usually interest on such expenses.
These are monies the law firm has spent in pursuing the claim and include court filing fees, the cost of expert reports and barristers’ fees.
• While a lawyer may carry the risk for their own fees, it is highly unusual for them to carry any risk for the other party’s legal costs.
Typically, if you lose your case it is you who must pay the other side’s legal costs, irrespective of whether or not you have a ‘no win ‐ no fee’ costs agreement with your own lawyer.
Too often, it has been claimed that the legal system is only for those rich enough to afford it. In many circumstances this may indeed be the case. The advent of law firms willing to operate on a ‘No Win No Fee’ basis is therefore most welcome in Australia, although it is often limited to personal injury claims, where there is a reasonable prospect of recovering money in the form of damages from the defendant’s insurance company.
There is no doubt that a ‘no win ‐ no fee’ costs agreement gives people with limited finances access to justice. For people who can’t afford to pay their legal costs up‐front or on a ‘pay as you go’ basis, this type of arrangement enables them to engage a lawyer to help them pursue their legal rights. They pay the lawyer only after their case is settled or otherwise decided, and only if they are successful.
This ensures that no injured person is denied justice because they can’t afford legal representation.
When can you ask for a ‘no win ‐ no fee’ costs agreement?
Lawyers and their clients can enter into this type of arrangement in any case except criminal matters or family law matters.
However, law firms typically offer ‘no win ‐ no fee’ terms only in cases where
there is, or is likely to be, money available to pay the costs after the case is won or a matter is settled, such as personal injury claims and some types of deceased estate matters.
Ask your lawyer up‐front if they are prepared to enter into a ‘no win‐ no fee’ costs agreement.
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