Further update, 15 February 2017: The Victorian Legal Services Commissioner has formally advised me, and authorised me to tell you, that he will treat the transitional provisions as meaning that where the solicitor’s retainer is governed by the 2004 Act, so too will barristers’ retainers by the solicitor be governed by that Act, even if the brief post-dates the 1 July 2015 commencement of the LPUL.
Update: The position of the post-1 July 2015 briefed barrister briefed by a solicitor retained pre-1 July 2015 is not as clear as I suggested below. So now it’s me who’s arguably been disseminating misinformation: my apologies. But it seems to me that there has plainly been a drafting error. Certain that I knew what the intention of the transitional provision was, I overlooked what the actual words of cl. 18(2) say:
‘If a law practice [read ‘barrister’] is retained by another law practice [read ‘solicitor’] on behalf of another client [read, I would suggest, ‘a client’] on or after [1 July 2015] in relation to a matter in which the other law practice [read ‘solicitor’] was retained by the client before [1 July 2015]—
(a) Part 4.3 of this Law does not apply in respect of the other law practice [as drafted, this must be a reference to the solicitor, and this is the error] in relation to that matter; and
(b) in that case the provisions of the old legislation relating to legal costs … continue to apply.’
As drafted, there is no point to the provision. It is otiose in the context of cl. 18(1), which is said to be subject to sub-clause (2). It is beyond doubt in my mind that what was intended was a provision cognate with the similar provision in the Legal Profession Act 2004, which is as follows:
‘(2) Part 3.4 of this Act does not apply in respect of a law practice that is retained by another law practice on behalf of a client on or after the commencement day in relation to a matter in which the other law practice was retained by the client before the commencement day and in that case Part 4 of the old Act continues to apply.’
If the transitional provision as enacted is given its literal meaning, which given the apparent absence of ambiguity might require sophisticated argument to avoid, then the absurd situation will arise where one part of the legal team is regulated by one Act and the other by another. This may well be a situation where the provision is read to mean something other than what it plainly seems to say in order to avoid an absurd result which parliament could not be taken to have intended. Nevertheless, the answer should lie in retrospective amendment, and I believe that this problem will now be raised urgently at the highest levels, so I will keep you posted.
Original post: Misinformation about the transitional provisions for the new law regulating legal practice set to commence on 1 July 2015 is circulating around the Bar. Most people seem to understand that the question of whether the Legal Profession Act 2004 continues to have operation to a solicitor’s retainer after its repeal or whether the Legal Profession Uniform Law applies is answered by working out when instructions were first taken in ‘the matter’. (Let me digress for a moment. What a ‘matter’ is is not defined in the new Law (or the old Act), and remains a mystery to the world of costs law, although some guidance may be found in Darkinjung Local Aboriginal Land Council v Darkinjung Pty Ltd  NSWSC 132. It is not clear that ‘matter’ and ‘retainer’ are co-extensive, and nor is it clear that a ‘matter’ is equivalent in scope to the scope of a ‘costs agreement’ which is applicable: that, I think we can say with some confidence. Generally, parties may agree as between themselves on what a statute is to be taken to mean. Those who take a sophisticated approach to handling costs disclosures under the new Law are likely to reduce the scope of their risk by carefully defining what a ‘matter’ is. More about that anon, perhaps, but the broader the retainer the more difficult the task of estimating total legal fees, and if the ‘matter’ in respect of which disclosure must be given may be attenuated by agreement, that would seem sensible from the lawyer’s point of view. Clients ought resist such an approach and actually ask what they want to know (e.g. how much might this litigation you’re proposing for me cost if the other side appeals all the way to the High Court and things go as pear shaped as can be imagined, and what are my chances of getting out of it without having to pay the other side’s costs at different points along the way?).)
What seems not to be appreciated is that which law applies to a barrister’s brief by a solicitor (as opposed to a direct access brief) depends on which law applies to the solicitor’s retainer. So a solicitor first instructed in relation to a matter prior to 1 July 2015 will continue to be governed by the old Act, and a barrister first briefed by that solicitor in that matter (or re-briefed in it for that matter) after 1 July 2015 will continue to be bound by the old Act too. The transitional provision is cl. 18 of Schedule 4 to the Legal Profession Uniform Law Application Act 2014 and sub-clause (2), apposite to barristers, is set out at the end of the post. Continue reading “Transitional arrangements for costs provisions of Legal Profession Uniform Law”