Todorovska v Brydens Lawyers Pty Ltd

The applicant, Ms. Todorovska, sought leave to appeal from a decision of the District Court of New South Wales concerning legal costs. The dispute arose from a personal injury claim where the legal costs incurred by Brydens Lawyers Pty Ltd, the respondent, amounted to approximately two-thirds of the judgment amount awarded to Ms. Todorovska. This raised questions about the regulation of dealings between legal practitioners and their clients, particularly in relation to statutory caps on costs.

The central legal issues before the Court of Appeal were whether the District Court had erred in its assessment of the costs, specifically concerning the application of the *Legal Profession Act 2004* (NSW) and the *Legal Profession Regulation 2005* (NSW). The court was required to determine whether the removal of a statutory cap on solicitor-client costs, through a costs agreement, had been effected in compliance with the disclosure requirements intended to protect clients. This involved considering whether Ms. Todorovska had been adequately informed of the statutory protection she was foregoing and the implications of the costs agreement.

The Court of Appeal found that the District Court had erred in its approach to the costs agreement and the associated disclosure requirements. The court emphasised that disclosures made to give effect to the statutory purpose must ensure the client is fully informed of the statutory protection and the effect of entering into a costs agreement that removes such protection. The court held that these disclosures must be read in the context of all documents provided to the client, and that the importance of independent legal advice in such circumstances could not be overstated.

Consequently, the Court of Appeal granted leave to appeal, set aside the relevant order of the District Court, and ordered that the respondent pay to the applicant the sum of $26,200 plus interest and costs. The respondent was also ordered to pay the applicant’s costs of the application for leave to appeal and the appeal itself.