A lawyer’s bill is in two parts.
- Professional services - a fee for performing the actual work.
- Other expenses - these are fees or other charges the lawyer may incur on your behalf. They are known in legal terms as disbursements. They may include, court filing, barrister’s fees and other expert’s fees, bank charges, travel expenses, stamp duty, courier’s fees, attendance fees (to serve or collect documents), photocopying fees and company or other search fees.
What will my lawyer cost?
Most lawyers charge an hourly rate based on the actual time they spend working on your legal problem. They must give you an estimate of their costs upfront if their total bill costs more than $750. You can negotiate your billing method (for example by asking for a fixed fee). You can also negotiate how often you will receive a bill from them before final payment is due.
Hourly rates are most commonly charged in six minute units. For example, the time charged for a 6 minute phone call will be six minutes and the time charged for an eight minute phone call will be 12 minutes.
Costs may also be charged according to a scale of costs or on a per item basis. The way your lawyer will charge you will be set out in your costs disclosure or costs agreement.
Your lawyer should record the time they spend working on your matter on your legal file. They keep this file in their office. Legal files can be paper-based, electronic or a combination of both.
Types of billing methods
A flat fee charged per hour of work. The amount charged may vary based on the seniority or experience of the lawyer. They must tell you what the rate is, and what work was done for each billing unit of six minute intervals. Some lawyers charge in 15 minute intervals.
A set fee can be paid at certain intervals for a specific scope of work. For example, a lawyer may offer their client a specified number of advice consultations per month for an agreed charge. It is particularly useful for clients that need small scale assistance on a range of high volume, but low level legal work - such as a small business.
A flat fee is charged per item of work. For example, issuing a summons, making a photocopy or preparing an affidavit. This way of charging is common in court cases.
Agreed pricing or fixed-fee pricing
An agreed amount is charged on the entire matter or each stage or milestone of work that is carried out. For example, to prepare a will or a property transfer or lodge a divorce application in court.
Conditional payments (including No-win, No-fee)
You pay your lawyer a set a fee based on certain conditions or outcomes being met in your legal matter. Examples include:
- You only pay if they achieve a successful outcome to your case
- If you lose your case you only pay for other expenses (such as court costs, medical expert report fees and barrister’s fees - not your lawyer’s professional fees)
However, you still may need to pay the other party’s legal costs - make sure your lawyer clearly explains what you could end up paying. Any conditional cost agreements must be made in writing and signed by both you and your lawyer. You should also make sure both you and your lawyer agree on what a 'successful outcome' means in your agreement.
These types of agreements are commonly used in personal injury cases and in some instances estate matters. They cannot be used in criminal or family law matters.
Sometimes law firms will seek payment from any monies that you could receive if they win your legal case. How much they will receive from any compensation or settlement amount should be set out in writing for you. You can then decide if this would be a good outcome for you. In Victoria this type of payment agreement is only allowed in class actions. In any other circumstances it is illegal to do so.
Baymos engages a No-win, No-fee law firm after he and several colleagues were injured when a wall collapsed at a building site. Baymos' lawyers commenced legal proceedings for pain and suffering compensation. Baymos settles the legal case with his employer for $500,000. His lawyer has assessed his legal fees will be $50,000 to be deducted from the total compensation payment.
You will need to pay your lawyer and if you go to court or a tribunal you may need to pay all or part of the other party’s legal costs.
The court or tribunal would make orders or directions. You may have part of your legal costs paid by the other party under the direction of the court or tribunal.
No-win, No-fee does not always mean ‘free’. You may need to pay the other party's legal costs if you are not successful with your case. Your lawyer may not ask for payment for their professional services, but they could charge you for other costs such as preparing papers for the court. They may charge an ‘uplift fee’ which is a fee on top of legal fees if you win your case. An uplift fee must not be any more than 25 percent of the professional fees they charge you (not including disbursements).
You must have a conditional costs agreement in writing and sign it for no-win, no-fee agreements. Be sure you understand the conditional costs agreement, particularly when you could be out of pocket and for how much. You should also seek independent legal advice before entering into the agreement if you are unsure.
If you need legal help, but cannot afford a lawyer you can contact Justice Connect, Victoria Legal Aid and other community legal support centres. Learn more on our Other ways to get help page.
You can search our register of lawyers. It lists all Victorian lawyers and law practices that offer legal services. It includes information about their special areas of interest, and other languages spoken.
We encourage you to shop around to find the right lawyer for your circumstances.