{"id":6211,"date":"2021-09-29T13:41:19","date_gmt":"2021-09-29T02:41:19","guid":{"rendered":"https:\/\/insight.thomsonreuters.com.au\/legal\/?p=6211"},"modified":"2022-08-03T16:03:31","modified_gmt":"2022-08-03T05:03:31","slug":"best-practice-disclosure-for-australian-based-lawyers","status":"publish","type":"post","link":"https:\/\/insight.thomsonreuters.com.au\/legal\/posts\/best-practice-disclosure-for-australian-based-lawyers","title":{"rendered":"Best-Practice Disclosure for Australian-Based Lawyers"},"content":{"rendered":"\n<h4 class=\"wp-block-heading\">Some lawyers appear to have difficulty in seeing the opportunity disclosure gives to shape and perform legal services collaboratively and successfully.<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Within <a href=\"https:\/\/legal.thomsonreuters.com.au\/quick-on-costs\/productdetail\/52031\"><em>Quick on Costs<\/em><\/a>, published by Thomson Reuters, the Chapter \u201cDisclosure\u201d takes lawyers through a recommended disclosure checklist which can clear up any uncertainties surrounding these issues. In this article, I\u2019ll outline some of the key considerations that lawyers handling disclosure ought to be mindful of.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Disclosure FAQs<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">1. What is disclosure and why do we need it?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Disclosure is the action of making new or secret information known.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The move towards disclosure may be traced to the fact that consumers of legal services have become more sophisticated and have a greater awareness and appreciation of their rights than appears to have been the case previously.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. Costs disclosure and bill disclosure between lawyer and client<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">In the States and Territories (other than New South Wales and Victoria) the governing laws are the Legal Profession Acts (the LPAs) and Regulations. In New South Wales and Victoria, the laws are the Legal Profession Uniform Law (the LPUL) and Regulations. Both have disclosure but are different in their design, drafting and possible effects.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. Disclosure Documents, Retainers and Costs Agreements<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The prospect of costs disputes can be avoided by a transparent disclosure of what requires to be disclosed, as well as clearly drafted retainers and costs agreements.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A retainer is the contract essential to the creation of any relationship between lawyer and client, entitling the lawyer to charge legal costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A costs agreement is a second contract about the payment and quantification of the legal costs flowing from a retainer. The LPAs define and regulate costs agreements but not retainers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Costs disclosure is neither a retainer nor a costs agreement. Legislation makes it quite clear that a costs disclosure should precede a costs agreement. This is the first of several reasons why there should be a separate disclosure document\/ checklist rather than the single \u201cone size fits all\u201d document repeatedly offered up to potential clients.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Two separate disclosure regimes exist: costs disclosure and bill disclosure.&nbsp;Non-compliance with each can trigger different consequences.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Costs disclosure<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With some exceptions, lawyers have initial obligations to give clear, written costs estimates and other information before being retained, or as soon as reasonably practicable thereafter. Under the LPAs, these estimates and information need not be given to sophisticated clients and under LPUL need not be given to commercial or government clients. &nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Lawyers also have ongoing obligations to make disclosures relating to costs during the progress of work under a retainer, for example, in litigation upon briefing counsel and upon settlement of litigation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Bill disclosure<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The disclosures required to be part of a bill are about the options for challenging the fees to which the bill relates, the time limits for exercising them and rules requiring a statement of the interest to be charged for late payment. There are prescribed forms relating to these to which a disclosure document \/ checklist can refer which help avoid having to confront common \u201cend of engagement\u201d problems such as having to give an itemised bill if the client seeks one or to re-render a conforming bill when deciding to sue or not.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">The effects of failures in Costs Disclosure or Bill Disclosure<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Costs disclosure<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If there is a serious breach of the lawyer\u2019s costs disclosure obligations, possible effects include:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">a) the client need not pay the legal costs, and the lawyer cannot maintain proceedings for recovery of the legal costs until they have been assessed. Because of the breach, the costs of the assessment will generally also be payable by the lawyer; and<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">b) lawyers involved in the breach may be investigated for unsatisfactory professional conduct or professional misconduct<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4. The consequences of non-disclosure in the lawyer and client relationship<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Costs disclosure <\/em><em><\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The effects of non-disclosure of Costs Disclosure differ between the LPAs and LPUL. The LPAs provide for reductions of costs but LPUL made void the costs agreement until an about face in an \u201canti-voiding\u201d regulation in March 2016 allowed an opportunity to rectify failures in disclosure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Bill disclosure<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The lawyer may not commence proceedings to recover fees until a specified time after a bill conforming with the statutory requirements has been given.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Minimising the risk of client disputes<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The prospect of costs disputes can be avoided by clear retainers and costs agreements and clear disclosure of what requires to be disclosed when required. What needs to be done to deal with disclosure is the preparation of the disclosure statement and checklist suggested.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">What is the great difficulty that lawyers seem to have in seeing the opportunity disclosure gives to shape and perform legal services collaboratively and successfully? It will not have escaped the careful reader that disclosure opens the possibilities of collaborative success in three of the five billing fundamentals introduced in the insider article<a href=\"https:\/\/insight.thomsonreuters.com.au\/legal\/posts\/is-the-market-changing-faster-than-your-firm-5-billing-fundamentals\">:<em> Is Your Market changing faster than your Business? 5 Billing Fundamentals<\/em><\/a>,<em> <\/em>namely alternative fee arrangements, legal project management and costs budgeting\/costs management.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The author of Quick on Costs outlines some of the key considerations that lawyers handling disclosure ought to be mindful of.<\/p>\n","protected":false},"author":229,"featured_media":6225,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[642,576,1325],"tags":[1659,1657,1658],"insight_job_role":[604,614,619],"insight_practice_area":[],"class_list":["entry","author-rogerquick","has-excerpt","post-6211","post","type-post","status-publish","format-standard","has-post-thumbnail","category-billing-and-invoicing","category-business-management","category-legal","tag-costs-agreements","tag-disclosure","tag-retainers","insight_job_role-knowledge-manager","insight_job_role-partner","insight_job_role-practice-manager","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Best-Practice Disclosure for Australian-Based Lawyers<\/title>\n<meta name=\"description\" content=\"The author of Quick on Costs outlines 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