Legal Practitioners (Solicitors Costs) Report and Determination 2009 (WA)
!200900175GG!
WESTERN 3883 AUSTRALIAN GOVERNMENT
ISSN 1448-949X PRINT POST APPROVED PP665002/00041
| PERTH, WEDNESDAY, 30 SEPTEMBER 2009 | No. 175 SPECIAL |
PUBLISHED BY AUTHORITY JOHN A. STRIJK, GOVERNMENT PRINTER AT 3.30 PM
© STATE OF WESTERN AUSTRALIA
LEGAL PROFESSION ACT 2008
_________
LEGAL PRACTITIONERS
(SOLICITORS COSTS)
REPORT AND
DETERMINATION
30 September 2009 GOVERNMENT GAZETTE, WA 3885 LEGAL PROFESSION ACT 2008 LEGAL PRACTITIONERS (SOLICITORS COSTS) REPORT 2009
Made by the Legal Costs Committee under section 277 of the Act.
PART 1—PRELIMINARY
Citation
1. (1) This report may be cited as the Legal Practitioners (Solicitors Costs) Report 2009.
(2) The determination set out in the Schedule to this report is referred to in this report as theSolicitors Costs Determination 2009.
PART 2—NOTICE AND ENQUIRIES
Notice under section 278 of the Act
2. The Legal Costs Committee has complied with the notice provisions of section 278 of the Act.
Enquiries and submissions under section 277 of the Act3. Before making the Solicitors Costs Determination 2009, the Legal Costs Committee—
(a)
reviewed the submission of the Law Society of Western Australia Inc received as a result of the notice given under section 277 of the Act; and
(b)
reviewed the impact of movements in the Consumer Price Index and Labour Price Index for the period between June 2007 to June 2009 (inclusive).
PART 3—REPORT OF COMMITTEE’S CONCLUSIONS
Maximum hourly rates changed—scale of costs amended
4. (1) As a result of its inquiries and the submission described in clause 3, the Legal Costs Committee is satisfied it is appropriate to continue to adopt hourly rates charged by practitioners as the basis for the rates used in the Solicitors Costs Determination 2009 subject to clause 4(2). It is also considered appropriate to retain a system of instruction fees as set out in items 1 to 5 of the Table to clause 6 of the Solicitors Costs Determination 2009 subject to clause 4(3).
(2) The Legal Costs Committee decided that it is no longer necessary to retain the categories of legal services providers described in Items 701 to 704 (inclusive) of the Solicitors Costs Determination 2007, given the provisions of the Legal Profession Act 2008 and the categories of fee earners described in more recent Reports and Determinations published by the Legal Costs Committee and the new legislation governing the legal profession.
This change is not intended to exclude from remuneration the work of any person whose work was
remunerated under the Solicitors Costs Determination 2007 and its predecessors.
(3) The Legal Costs Committee has accepted the recommendation of the Law Society of Western
Australia that Item 4 of the Table to clause 6 in the Determination should be amended to include
references to Sub-Leases and Assignments of Lease.
The Legal Costs Committee also considers that the likelihood of transactions under $25,000.00
occurring has diminished significantly and that the first line item in Items 501 and 502 of Item 5 of
the Table to clause 6 should now read “1—150,000”.
(4) It is the recommendation of the Legal Costs Committee as a result of the inquiries and
submissions described in clause 3 that the hourly rates referred to in subclause 4 (1) are varied from
the hourly rates used in the Solicitors Costs Determination 2007 published in the Government Gazette
on27 September 2007 pp 4855-4861 . Those rates are set out in the Table to clause 6 of the Solicitors
Costs Determination 2009.(5) The recommendations of the Legal Costs Committee are not intended to override the entitlement of a practitioner to make a written agreement as to costs with a client under the Legal Profession Act 2008.
TED SHARP, Chairman.
ANGELA GAFFNEY, Member.
CLARE THOMPSON, Member.
MARCUS COCKER, Member.
JANICE DUDLEY, Member.
MATTHEW CURWOOD, Member.
————
Schedule
LEGAL PROFESSION ACT 2008
Solicitors Costs Determination 2009
Made by the Legal Costs Committee under section 275 of the Act.
Citation
1. This determination may be cited as the Solicitors Costs Determination 2009.
Commencement
2. This determination comes into operation on 1 October 2009.
3886 GOVERNMENT GAZETTE, WA 30 September 2009 The Solicitors Costs Determination 2007
3. The determination cited as the Solicitors Costs Determination 2007 published in the Government Gazette on 27
September 2007 pp 4855-4861 does not apply to business carried out by practitioners after the commencement
of this determination.
Interpretation
4. In this determination—“clause” means a clause in this determination;
“document” includes a document in electronic form;“instruction fee” means the fee set out in the column headed ‘Amount’ in the Table, in relation
to the matter specified next to that fee in the Table;
“instructions” in relation to items 1 to 5 includes the initial attendance when instructions are taken, and all subsequent attendances at which instructions are taken which ought properly to have been taken at the initial attendance;
“item” means an item in the Table;“mortgagee” includes the grantee of a security and, in relation to a hire-purchase agreement,
means the owner;
“mortgagor” includes the grantor of a security and, in relation to a hire-purchase agreement, means the hirer;
“prepare” includes considering searches, researching matters of law, negotiating, settling and drafting the provisions of and producing a document;
“security” includes a mortgage, hire-purchase agreement, debenture or charge or a bill of sale or assignment by way of security, or any other form of security granted by a person;
“sheet” means one side of a single A4 page, with no less than 25 lines of print with a minimum of a 10 point font;“Table” means the Table to this determination.
Application
5. (1) This determination applies to the maximum remuneration of practitioners in respect of any work carried out by a practitioner not being of a contentious nature and which is not governed by any other determination of the Legal Costs Committee under section 275 of the Legal Profession Act 2008. (2) This determination does not apply to the remuneration of practitioners based on a written agreement as to costs with a client under the Legal Profession Act 2008.
(3) This determination does not apply to the remuneration of practitioners based on costs incurredbefore the commencement of the determination.
Costs
6. Unless a practitioner has made a written agreement as to costs with a client under the provisions of the Legal Profession Act 2008, the costs payable by the client to the client’s practitioner shall not exceed an amount that is reasonable in the circumstances, that amount to be calculated on the basis of—
(a) the instruction fees and other fees for specific items set out in items 1 to 6 of the Table; and (b)
the time reasonably taken to perform the work referred to in item 7, charged at an hourly rate that does not exceed the hourly rates set out in that item; or
(c)
where clause 14 applies, the skill, urgency or complexity required to perform the work, together with the time reasonably taken to do so.
Instruction fee when acting for both parties to a transaction
7. Subject to clauses 8 and 9, where a practitioner properly acts for both parties to a transaction, thepractitioner is entitled to charge each party the relevant instruction fee relating to that transaction.
Instruction fees for related transactions
8. (1) Subject to this clause, where a practitioner acts for either a purchaser-mortgagor or for a vendor-mortgagee, the practitioner may charge either the instruction fee fixed in relation to the sale or the instruction fee fixed in relation to the security, but not both.
(2) Where a practitioner acts for a vendor in circumstances to which item 5 applies, and the consideration or part thereof is secured by a security prepared by the same practitioner and executed by the purchaser in favour of the vendor, the practitioner shall be entitled to charge in respect of the sale the fee set out in item 5 reduced by 20%, and for instructions in respect of the security the instruction fee calculated in accordance with item 3 on the basis of the sum secured.
(3) Where, in respect of one and the same transaction, a practitioner properly acts for both apurchaser-mortgagor and a vendor-mortgagee—
(a)
if all the costs are to be paid by only one of the parties, the practitioner is entitled to charge the instruction fee in relation to the sale, calculated on the basis that the practitioner was acting for the purchaser, but is not entitled to charge an instruction fee in relation to the security;
(b)
if each party is to pay their own instruction fee, the practitioner is entitled to charge each party such an amount so that the aggregate of the amounts payable by each is no greater than the instruction fee in relation to the sale, calculated on the basis that the practitioner was acting for the purchaser.
30 September 2009 GOVERNMENT GAZETTE, WA 3887 (4) Where, in one and the same transaction, a practitioner properly acts for both the vendor and the purchaser or for both the mortgagor and the mortgagee, the practitioner is not entitled to charge in respect of the instructions any amount which is greater in the aggregate than the instruction fee in relation to the sale or the security, calculated on the basis that the practitioner was acting for the purchaser or the mortgagor, as the case may be.
(5) Where a practitioner acts for the mortgagee on instructions to extend the term of the security, the practitioner is entitled to charge, for instructions, an amount not exceeding 40% of the instruction fee that would be payable in relation to an original security for the same amount as that secured by the security as extended.
Instruction fees for leases
9. (1) Where a practitioner properly acts for both the lessor and the lessee in respect of a lease or an extension of lease, the practitioner is entitled to charge for instructions only the instruction fee set out in item 4 in relation to a lessor.
(2) For the purposes of calculating the instructions fees set out in item 4—
(a)
where a term of a lease exceeds 12 years but does not exceed 26 years—the instruction fee shall be calculated on the basis of the rent payable during the first 12 years of the lease;
(b)
where the term of the lease exceeds 26 years—the instruction fee shall be calculated on the basis of the rent payable during the first 15 years of the lease,
and for this purpose the term “rent”—
(c) includes any moneys payable as a premium for the granting of the lease; (d) does not include any moneys payable or reserved under or by the lease in respect of— (i) rates and taxes whether by way of reimbursement of the lessor or otherwise; or
(ii) expenditure incurred by the lessor in the conduct or management of the lease and premises or of any other property of which the leased premises forms part.
Limitations on instruction fee in item 3
10. In relation to an instruction fee set out in item 3—
(a)
any amount secured by an existing collateral security prepared by the same practitioner within one year prior to the instructions shall be deducted from the amount to be secured before calculating the instruction fee; and
(b)
where the security is for an annuity and the term during which the annuity is to be paid is a period exceeding 12 years or for life—the instruction fee shall be calculated on the basis that the amount secured is 12 times either the annual payment or the average of the first 12 payments.
Uncompleted business
11. Where any business is not completed the instruction fee payable shall be such proportion of the
relevant instruction fee payable under this determination as is reasonable in the circumstances.
Services related to item 5
12. (1) The fees set out in item 5 are the remuneration payable in respect of acting on instructions for the completion by transfer of an executed contract for the sale of land registered under the Transfer of Land Act 1893 and include the fees for all services usually performed in respect of the transaction and in particular—
(a) the investigation of title;
(b) enquiries of and advice to all rating and taxing authorities of change of ownership; (c) the adjustment of rates and taxes;
(d) preparation, execution, stamping and the registration of the transfer; and (e)
the arrangements for and attendances on settlement including the discharge of encumbrances,
but the remuneration does not include the fees for—
(f) any service performed or rendered in respect of an amendment to the contract of sale; (g) the perusal of any document other than the contract of sale; (h) the preparation of any document other than the transfer;
(i) requisitions on title or answers thereto;
(j) correspondence or attendances as may be rendered necessary by the amendment to, or the preparation of, any document other than the transfer; (k) correspondence or attendances not usually involved in respect of completion of the contract of sale including interpretation of or enforcement of the contract of sale; or (l) any costs or expenses properly incurred due to the distance of the practitioner from the place of settlement or from an office of the Western Australian Land Information Authority. (2) Where a practitioner acting on instructions to which item 5 applies is obliged to perform additional services which are not services to which item 5 applies, the practitioner is entitled to charge for those additional services at the rate set out in item 7.
3888 GOVERNMENT GAZETTE, WA 30 September 2009 Preparing documents and copies for execution, photocopying, facsimile and electronic transmissions (item 6)
13. The fees set out in items 601 and 602 are fees in addition to time taken to prepare documents
(including amendments to drafts or standard documents) and—
(a)
In the case of item 601—’Documents which could economically be a standard precedent’—the fee is intended to recognize the cost to, and time taken by, a practitioner in the preparation and maintenance of standard precedents—by way of example, a standard office lease, shop lease, assignment of lease, extension of lease and mortgage;
(b)
in the case of item 602, the fee is intended to recognize the cost to, and time taken by, a practitioner in the preparation, availability and maintenance of a document which is not a standard precedent within item 601, and the skill, cost of preparation and maintenance of having such a document available.
Complex matters, and matters involving a high degree of skill or urgency
14. Where a practitioner acts on instructions or performs a service in respect of a matter—
(a) in relation to which a fee or rate of remuneration is set out under items 1 to 6, that is complex, or involves a high degree of skill or urgency; or (b) that is not referred to in any of items 1 to 6, then, notwithstanding the rates in item 7, the practitioner is entitled to charge a fee, or charge at a rate (as the case requires) that is greater than one that is set out in an item, if it is reasonable in the circumstances.
Effect on costs of Goods and Services Tax (GST)
15. The hourly rates and the calculation of fees under each of the items in the Table are intended to
be inclusive of GST.
Table (Clause 6)
ITEM 1—INSTRUCTION TO ACT ON A SALE OR OTHER DISPOSITION FOR VALUABLE
CONSIDERATION OF PROPERTY
Maximum
Ref
Party
Consideration ($)
Amount (as a %)
101 Purchaser 1—100,000 0.45% 100,001—7,500,000 0.25% 7,500,001 or more 0.03% 102 Vendor 1—100,000 0.35% 100,001—7,500,000 0.17% 7,500,001 or more 0.02% ITEM 2—INSTRUCTIONS TO ACT ON A GIFT OF REAL OR PERSONAL PROPERTY OR BOTH
WHERE VALUE ASCERTAINABLE
Maximum
Ref
Party
Value ($)
Amount (as a %)
201 Donor 1—100,000 0.45% 100,001—7,500,000 0.25% 7,500,001 or more 0.03% 202 Donee 1—100,000 0.35% 100,001—7,500,000 0.17% 7,500,001 or more 0.02% ITEM 3—INSTRUCTIONS TO ACT ON SECURITY
Maximum
Ref
Party
Consideration ($)
Amount (as a %)
301 Mortgagee 1—100,000 0.45% 302 Mortgagor 100,001—7,500,000 0.25% 7,500,001 or more 0.03% 1—100,000 0.23% 100,001—7,500,000 0.13% 7,500,001 or more 0.013%
30 September 2009 GOVERNMENT GAZETTE, WA 3889 ITEM 4—INSTRUCTIONS TO ACT ON A LEASE, SUB-LEASE, ASSIGNMENT OF LEASE OR
EXTENSION OF LEASE OF PROPERTY (REAL OR PERSONAL OR BOTH)
Maximum
Ref
Party
Consideration ($)
Amount (as a %)
401 Lessor/Sub-Lessor 1—20,000 0.80% 20,001 or more 0.40% 402 Lessee/Sub-Lessee 1—20,000 0.40% 20,001 or more 0.20% 403 Assignor/Assignee 1-20,000 0.40% 20,001 or more 0.20% ITEM 5—THE SETTLEMENT OF A CONTRACT FOR THE SALE OF LAND UNDER THE
TRANSFER OF LAND ACT 1893
Maximum
Ref Party Consideration ($) Amount or % 501 Purchaser* 1-150,000 $847 150,001—500,000 $847 plus 0.22% of any amount in excess of $150,000 500,001—1,000,000 $1617 plus 0.165% of any amount in excess of $500,000 1,000,001 or more
$2442 plus 0.11% of any amount in excess of $1,000,000
502 Vendor* 1-150,000 $572 150,001—500,000 $572 plus 0.143% of any amount in excess of $150,000 500,001—1,000,000 $1023 plus 0.11% of any amount in excess of $500,000 1,000,001 or more
$1628 plus 0.077% of any amount in excess of $1,000,000
*If the contract for sale is for a Strata Title, add $55.00 if acting for the Vendor, and $110.00 if acting
for the Purchaser.
ITEM 6—PREPARE DOCUMENTS AND COPIES FOR EXECUTION, PHOTOCOPYING,
FACSIMILE AND ELECTRONIC TRANSMISSIONS
Maximum
Ref Description of task Amount Preparation of documents
601 Documents which could economically be a standard $11.00 per sheet precedent 602 Documents which could not economically be a standard $44.00 per sheet precedent All copies for execution and cost of binding
603 Each document for execution $3.00 per page Photocopying (other than item 603)
604 Each page $1.00 per page Facsimile and Electronic Transmissions
605 Each page sent $3.00 per page Ref Practitioner Maximum Rate
701 Practitioner (admitted 5 years or more) $418 per hour 702 Practitioner (admitted less than 5 years) $297 per hour 703 Clerk/Paralegal $198 per hour Note: The reference to practitioner in this determination includes all legal practitioners even if the services were rendered in another State or Territory. Where a local legal practitioner has held an interstate practice certificate, the length of admission in that other jurisdiction is to be counted in assessing that practitioner’s years of admission for the purposes of this Determination. Travel 704 Travel is to be calculated in the same manner as items 701 to 703,
with a maximum of 8 hours in any one dayAttendances and performance work where items 1–6 do not apply, and travel, and including time otherwise necessarily spent where no other charges apply
Made by the Legal Costs Committee on 22 September 2009.
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