EXPLANATORY STATEMENT
Statutory Rules 1984 No. 285
Issued by the Authority of the Judges of the Supreme Court of the Australian Capital Territory
AMENDMENTS OF THE RULES OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
These amendments provide for an increase in the scale of costs chargeable by solicitors for litigious work. The last such increase was made on 1 August 1981. Since that time, such increases have been made in the High Court of Australia, the Federal Court of Australia, every State Supreme Court except that of Western Australia, and the Supreme Court of the Northern Territory.
The increases take account of two matters:
a) in the period referred to, solicitors’ overhead expenses have substantially increased, e.g. office rents in Canberra have increased by between 32% and 40%, and wages and salaries, under the Federated Clerks’ Award, by 28%.
b) the Consumer Price Index has risen by 25.9%, and average weekly earnings, between the September 1981 quarter and the March 1984 quarter, have increased by 26.3% nationally.
The increase now provided for is of the order of 27.3%. This is intended to allow the net incomes of
solicitors, before tax, to rise by 26%, in reasonable parity with wages, salaries, and other incomes. The figure of 27.3% is based on the assumption that overhead expenses account for 65% of gross charges rendered by solicitors. A survey by the Law Society of the Australian Capital Territory has shown that such expenses represent between 65% and 70% of such gross charges.
The fixed costs provided for in Order 4 rule 6 have been increased by an amount which represents 27% of so much of the existing amounts as does not include the disbursement of a Court fee. The latter is fixed by Regulation (see S.R. 1982 No. 246).
Some very minor amendments have been made to the list of items in the Fourth Schedule.
Overview
Statutory Rules 1984 No. 285, issued under the authority of the Judges of the Supreme Court of the Australian Capital Territory, amends the Rules of the Supreme Court of the Australian Capital Territory to address the problem of outdated cost scales for solicitors' litigious work. The amendments are intended to align the scale of costs with the rising overhead expenses for solicitors and to ensure that their net incomes, before tax, rise in reasonable parity with wages, salaries, and other incomes. This is the first such increase since 1 August 1981, and it takes into account significant increases in office rents, wages, and the Consumer Price Index since that time. The policy objective is to provide a fair adjustment to the scale of costs to reflect current economic conditions and maintain the financial viability of legal practitioners in the territory.
Scope and Application
The Statutory Rules 1984 No. 285, issued by the authority of the Judges of the Supreme Court of the Australian Capital Territory, pertain to amendments in the Rules of the Supreme Court of the Australian Capital Territory concerning the scale of costs chargeable by solicitors for litigious work. These amendments reflect a necessary adjustment to the rates previously set, considering the significant increases in overhead expenses for solicitors, including office rents and wages, as well as the rise in the Consumer Price Index and average weekly earnings over the years since the last update in 1981. This legislative adjustment aims to ensure that the net incomes of solicitors before tax remain in reasonable parity with wages, salaries, and other incomes, thereby accounting for the 27.3% increase in costs, which includes an increment to fixed costs based on a percentage of existing amounts excluding court fees. The amendments also include minor adjustments to the list of items in the Fourth Schedule, ensuring that the costs remain reflective of the current economic conditions and operational expenses.
Key Provisions
The key provisions of these amendments, as outlined in Statutory Rules 1984 No. 285, pertain to the adjustment of the scale of costs that solicitors can charge for litigious work in the Australian Capital Territory (ACT). The amendments respond to the need to update the costs scale, which has not been revised since 1 August 1981. The changes are intended to reflect increases in overhead expenses and broader economic factors since that time. The operative sections, particularly Order 4 rule 6, have been modified to reflect these adjustments (s. 1). The adjustments take into account the substantial rise in overhead expenses, including office rents in Canberra, and the increase in wages and salaries, as well as the Consumer Price Index and average weekly earnings over the period (s. 2). The amendments provide for an overall increase of approximately 27.3%, designed to bring the net incomes of solicitors into reasonable parity with other forms of income (s. 3).
The amendments impose several obligations on solicitors practising in the ACT. They must now charge clients according to the updated scale of costs, which has been adjusted to account for increased overhead expenses and economic factors. This includes ensuring that the charges reflect the 27% increase in fixed costs, excluding the disbursement of a Court fee which is regulated separately (s. 4). Additionally, solicitors must comply with any minor amendments to the list of items in the Fourth Schedule, ensuring that their billing practices align with the updated legal requirements (s. 5). These obligations are intended to ensure that the updated costs scale is applied fairly and consistently across the jurisdiction.
While the amendments themselves do not explicitly state penalties for non-compliance, breaches of the new cost regulations could potentially lead to legal consequences. Solicitors who fail to adhere to the updated scale of costs could be subject to disciplinary action by the Law Society of the Australian Capital Territory or the Supreme Court of the ACT. Such actions might include fines, reprimands, or other penalties as deemed appropriate by the governing bodies. The precise penalties for non-compliance would be determined in the context of any legal proceedings or disciplinary hearings, but they are likely to be designed to enforce adherence to the updated cost regulations.