The Legal Services Regulation Act 2015 makes extensive provision in Part 10 for a new and enhanced legal costs regime that will bring greater transparency to how legal costs are charged along with a better balance between the interests of legal practitioners and those of their clients whether they be private individuals or enterprise. The additional transparency requirements that will now apply with the forthcoming commencement of that Part of the 2015 Act are intended to complement those other measures being taken by the Government, with the support of the National Competitiveness Council and other key agencies, to keep legal and other transactional costs in the State at levels that can sustain or enhance our national competitiveness. It is also in the interests of legal service providers to maintain their cost attractiveness to clients at levels which will not place that sector at a competitive disadvantage. This is even more the case in an era when new business technologies and outsourcing are bypassing geographical location and other factors that would previously have sheltered some markets. At State level the Department of Public Expenditure and Reform and the Office of Government Procurement have also taken systemic steps to manage the major annual expenditure of State bodies on legal services.
All legal practitioners will be obliged, under the provisions of the new Legal Services Regulation Act, to provide more detailed information about legal costs from the outset of their dealings with clients. This will be in the form of a Notice, written in clear language, which must be provided when a legal practitioner takes instructions. Among other things, the Notice must disclose the costs that are involved, or, where this is not known, the basis upon which such costs are to be calculated. A cooling-off period is to be allowed for the consideration of costs by the client. When there are any significant developments in a case which give rise to further costs, the client must be duly updated and given the option of whether or not to proceed with proceedings. In addition, the Act sets out that it will not be permissible for legal practitioners to set fees as a specified percentage or proportion of damages payable to a client from contentious business and that it will no longer be permissible for barristers to charge junior counsel fees as a specified percentage or proportion of Senior Counsel fees.
An aggrieved client will also have the option of applying for the adjudication of disputed legal costs by the reformed and modernised Office of the Legal Costs Adjudicators, which is currently known as the Taxing-Masters' Office. The Act sets out, for the first time in legislation, a series of Legal Costs Principles. There will also be a publicly accessible Register of Determinations which will disclose the outcomes and reasons for decisions made by the Legal Costs Adjudicators. The Act will also introduce a system for processing complaints about excessive costs weighted towards the less costly option of informal resolution.
The 2015 Act sets out a clear path to new Legal Partnerships business models involving barrister/barrister partnerships and barrister/solicitor partnerships, which will allow for such partnerships to open for business in competition with the more traditional lawyer structures. The new Regulatory Authority will be carrying out public consultations and reporting with further legislative recommendations over its first four years in areas such as removing existing client money and direct access restrictions relating to barristers; examining entry and training requirements for the legal profession; unification of the two legal professions and the opening of the market to multi-disciplinary practices.
Overall, the 2015 Act seeks to achieve greater flexibility in the legal-services market, more competition and improved access to justice. Its combined measures will enable those availing of legal services, be they private consumers or enterprise, to identify costs more clearly, including in competition with other possible legal service providers. Both the Competition and Consumer Protection Commission and the Consumers Association will have members on the new Legal Services Regulatory Authority whose appointment is shortly to be considered for approval, as required under the 2015 Act, by a motion of both Houses.
The Mediation Bill, which is currently being drafted in the Office of Parliamentary Counsel, will also introduce an obligation on solicitors and barristers to advise any person intending to commence legal proceedings to give consideration to using mediation as an alternative means of resolving disputes. The Bill will also provide that a court may, following the commencement of any such proceedings, on its own initiative or at the request of a party to the proceedings, invite the parties to consider mediation as an alternative option and suspend the proceedings to facilitate that process. It is intended that the Mediation Bill will help to reduce recourse to the courts, as well as the costs and delays which may arise during court proceedings.
