Skip to content

Increase in hourly rates recoverable – Update to the CARC Guidelines

Legal costs

The Cost Assessment Rules Committee (CARC) have published the first and long-awaited update to the Guideline – Costs Payable Between Parties Under Court Orders (“Ordered Costs” Or “Party Party Costs”).

The Guidelines, first published in May 2016, are intended to provide guidance for Costs Assessors, in order to promote consistency and predictability in party party costs. They are not binding on Assessors. They are intended as a guidance as to what will usually be appropriate in ordinary cases, and they recognise that there will be unusual circumstances and extraordinary cases which will fall outside them. They are intended to apply to assessments on the ordinary (not the indemnity) basis.

Significant changes

The significant changes in the Guidelines relate to hourly rates for professional staff and counsel, the definition of paralegals and clerks/secretaries and the recoverability of photocopying, document production and other office overheads.

Hourly rates

The range of hourly rates are now detailed as such:

Service providerRange $
Senior partner/partner/specialist (10+ years) (hourly)540-900
Senior associate (5 years plus) (hourly)360-600
Employed solicitor / junior associate (1-4 years) (hourly)240-480
Senior counsel, where the assessor considers that it is fair and reasonable to have briefed senior counsel (daily)6,000-10,000
Senior counsel (hourly)600-1,000
Junior counsel (daily)2,400-5,600
Junior counsel (hourly)240-560
Paralegals(hourly)135-300
Clerks/secretaries 11 (hourly)90-180

This results in a 20% increase for law practices and slightly less for Counsel.

Definitions

The update introduces definitions for both paralegals and clerks/secretaries as:

Paralegal: This category is intended to cover employees not admitted to practice but holding a law degree or diploma, or equivalent experience.

Clerks/secretaries: This category is intended to cover unqualified employees.

Both definitions retain the caveat that such staff should not be allowed if the hourly rate of the relevant legal practitioner is such that it should be regarded as incorporating those services.

It will be interesting to see how the definition of “equivalent experience” evolves in relation to paralegals noting the sizable difference in the ranges allowed between them and Clerks/secretaries.

Photocopying, document production and other office overheads

The old guidelines allowed for photocopying/printing and document production to be allowed as a professional charge at 0.50c per page up to 50 pages, thereafter $0.20c per page.  If in colour, where reasonable, at $1.00 per page up to 20 pages, thereafter 50c per page.

Other office overheads such as scanning, electronic lodgement, telephone and faxes were generally allowed unless the hourly rate of the relevant legal service provider was such that it should be regarded as incorporating overheads.

The updated Guidelines state that office overhead costs such as photocopying, printing, document production, scanning, electronic lodgement, telephone, emails and faxes will generally be covered by the hourly rates of the lawyers and such costs would generally not be allowed either as a professional cost or as a disbursement, when undertaken in house by the lawyer or law practice.

However, the update states that on occasion it be reasonable for a lawyer or other staff member to carry out such activities (for instance extreme urgency or confidentiality), in which case a claim for the task at the hourly rate of that person may be allowed.

Allowances will be made as a disbursement for commercial printers to carry out reasonable printing or production of material such as evidence or court books.

Summary

No doubt the update will be welcomed by the profession and their clients with the benefit of cost orders.

The allowance for law practices is over the CPI increase for the relevant period but, in the writer’s experience, broadly in line with the market. One may, however, question whether the increase in allowances for Counsel are sufficient.

Should you require a legal costs consultant, costs expert or be involved in a costs dispute, contact the team at Pattison Hardman.

 

Charles Ackroyd

Principal