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Reasonable Fee Factors

Validatum » Reasonable Fee Factors

The following table provides a ready reference comparison between the Principles of Charging as were historically contained in the Rules of Professional Conduct for Barristers and Solicitors promulgated by the New Zealand Law Society, and the Reasonable Fee Factors set out in the new Lawyers Conduct and Client Care Rules 2008.

Since the advent of hourly rates and time recording, the profession has fallen into the trap of attaching a degree of primacy to "time and labour expended", often accompanied by the subjugation or even total disregard for any other costing criteria that might be relevant. There is nothing in the Lawyers and Conveyancers Act 2006 or the new rules or their respective antecedents, that ever accorded primacy to "time and labour expended" in determining what constitutes a reasonable fee.

Moreover, the relative importance of each of the Reasonable Fee Factors will vary according to the particular circumstances of each transaction (Callinicos Gallagher v Dobson {1993} 3 NZLR 611). Although that case was decided under the Principles of Charging, I have no reason to think that a case decided in similar circumstances under the new Lawyers Conduct and Client Care Rules 2008 would be decided any differently, at least, on the "weighting" issue anyway.

	'Old' Principles of Charging	'New' Reasonable Fee Factors (Deletions & additions are shown in bold italics)

1	Time & labour expended	Time & labour expended *(no change)*

2	Skill, specialised knowledge & responsibility required	Skill, specialised knowledge & responsibility required *to perform the services properly*

3	Importance of the matter to the client & the results achieved	Importance of the matter to the client & the results achieved *(no change)*

4	The urgency and circumstances in which the business is transacted	The urgency and circumstances in which the *~~business is transacted~~* *matter is undertaken and any time limitations imposed, including those imposed by the client*

5	The value or amount of any property or money involved	*The degree of risk assumed by the lawyer in undertaking the services, including* the amount or value of any property *~~or money~~* involved

6	The complexity of the matter and the difficulty or novelty of the questions involved	The complexity of the matter and the difficulty or novelty of the questions involved *(no change)*

7	The number & importance of the documents prepared or perused	*~~The number & importance of the documents prepared or perused~~*

8	The reasonable cost of running the lawyers practise	The reasonable cost of running *a ~~the lawyers~~* practise

9		*The experience, reputation and ability of the lawyer*

10		*The possibility that the acceptance of the particular retainer will be preclude engagement of the lawyer by other clients*

11		*Whether the fee is fixed or conditional (whether in litigation or otherwise)*

12		*Any quote or estimate of fees given by the lawyer*

13		*Any fee agreement (including a conditional fee agreement) entered into between the lawyer and client*

14		*The fee customarily charged in the market and locality for similar legal service*

Validatum » Reasonable Fee Factors

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