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The Australian Pro Bono Manual
Appendix 1: Precedents
LETTER OF ENGAGEMENT — COSTS AGREEMENT
GUIDANCE NOTE
This letter of engagement precedent takes the form of a costs agreement. It can be tailored for use in either non-
litigated matters (Option A) or litigated matters (Option B).
Key terms:
● In litigated matters, the firm can recover costs as awarded or agreed as part of a settlement, and the
agreement details the process of estimating costs that would be recovered. Estimates are provided of
costs likely to be awarded (if successful) or alternatively paid (if unsuccessful).
● In non-litigated matters, professional fees are not charged.
● Disbursements are charged to the client (unless approval is obtained to do otherwise).
Precedents in the Australian Pro Bono Manual are provided with the generous assistance of leading Australian
law firms, and have been developed to reflect best practice in pro bono.
There are two or more examples of each type of precedent to accommodate the various ways in which firms
coordinate their pro bono programs. Use the precedent that best reflects the firm’s size, structure, systems,
organisational culture and policies. Precedents should also be adapted as necessary to comply with the firm’s
house style and terminology.
The Centre welcomes feedback on the usefulness and ease of use of these precedents, especially from firms in
the early stages of developing a formal pro bono program.
LETTER OF ENGAGEMENT — COSTS AGREEMENT
Costs Agreement
Note: this agreement provides for disbursements to be charged to clients in all cases. If you do not plan to
charge disbursements (for example, if the client is a disadvantaged individual) please seek approval from the
pro bono coordinator first.
Details
Name
You, our client [ ]
ABN
[ ]
Address
[ ]
Contact: [name and title]
Name
Associated Third Party [ ]
Payer
ABN
[ ]
Address
[ ]
Contact: [name and title]
insert
The work we have been [ ]
asked to do
Name
Responsible contact at [ ]
[Firm]
date
This agreement starts on [ ]
Hourly rates These are given on page [insert] (Only for Option B — Litigated Matter)
insert
File name and number [ ]
Costs Note: select either Option A (Non Litigated Matter) or Option B (Litigated
Matter)
Option A — Non Litigated Matter
We have agreed to act for you in this matter on a pro bono basis.
This means that we will not charge you for our professional fees.
However, we will charge you for our disbursements.
Disbursements are expenses we incur on your behalf for services supplied
or payments charged by third parties. We will incur such disbursements as
agent for you and we will only recover from you the amount paid by us to
the third party (inclusive of any GST the third party has included in that
amount).
Set out below is a list of the likely disbursements you will incur in this
matter and an estimate of your total disbursements. However, this is only an
estimate and is not binding on us. We will let you know if the estimate
needs revising.
We will also obtain your approval and consent before we incur any
disbursements which are not listed in the table below.
1
GST exclusive GST amount GST inclusive
($) ($) ($)
Disbursements [amount] [amount] [amount]
(GST-free)
Disbursements [amount] [amount] [amount]
(not GST-free)
Cost [amount] [amount] [amount]
For litigious matters only Option B — Litigated Matter
We have agreed to act for you in this matter on a pro bono basis.
This means that we will not charge you for our professional fees unless the
work we perform for you results in an ‘Entitlement to Costs’ (as defined
below).
Regardless of whether or not the work we perform for you results in an
‘Entitlement to Costs’, we will charge you for our disbursements.
Disbursements are expenses we incur on your behalf for services supplied
or payments charged by third parties. We will incur such disbursements as
agent for you and we will only recover from you the amount paid by us to
the third party (inclusive of any GST the third party has included in that
amount).
The standard hourly rates that will apply in this matter are as follows:
Title Estimated number Rate
of hours
Partner
Special Counsel
Senior Associate
Solicitor
Paralegal
An estimate of the costs that may be payable, if you are successful or not, is
insert
given on page [ ].
As soon as practicable after there is any significant change to anything
previously disclosed to you, we will provide you with information disclosing
the change, including information about any significant change to legal costs
that will be payable by you.
Set out below is a list of the likely disbursements you will incur in this
matter and an estimate of your total disbursements. However, this is only an
estimate and is not binding on us. We will let you know if the estimate
needs revising.
We will obtain your approval and consent before we incur any
disbursements which are not listed in the table below.
GST exclusive GST amount GST inclusive
($) ($) ($)
Disbursements [amount] [amount] [amount]
(GST-free)
Disbursements [amount] [amount] [amount]
(not GST-free)
Cost [amount] [amount] [amount]
2
An ‘Entitlement to Costs’ means any of the following during or at the end
of the work performed for you:
(a) either of:
(i) a court or tribunal judgment, award or order for costs in your
favour; or
(ii) an agreement that our costs or disbursements or both be paid by
another party; and
(b) you are able to recover some or all of our standard hourly charges and
disbursements from the other party.
As soon as practicable after there is any significant change to anything previously disclosed to you, we will
provide you with information disclosing the change, including information about any significant change to
legal costs that will be payable by you.
Important
We are obliged to take all reasonable steps to satisfy ourselves that you have understood and given consent
to the proposed course of action for the conduct of the matter and the proposed costs. If you have any
questions in respect of any of the matters set out in this costs agreement, please contact us. We will
endeavour to provide answers to you in respect of any such questions.
Signing Page
Signed as an agreement.
Signed by on behalf of
Name
[ ]
sign (authorised person)
title (authorised person)
full name (authorised person)
Associated Third
Signed by [
Party Payer name (or use sign sign
alternative clause
for individuals)] in accordance office (director or secretary) office (director or secretary)
with the provisions of full name full name
s 127(1) of the Corporations
Act 2001 (Cth)
Signed on behalf of [Firm]
sign (authorised person)
Partner
title (authorised person)
full name (authorised person)
Agreement
1 Client
References in this agreement to you are references to you, our client. If there is more than one of you
then this binds each separately and you each need to consider obtaining independent advice.
In that case, we may report to and take instructions from any one of you on behalf of all. By acting for
more than one of you, we may be prevented from disclosing all relevant information which is within
our knowledge or giving advice to one, which is contrary to the interests of another. We may have to
cease to act for all if we would otherwise have to act in a manner contrary to the interests of one of
you. Further, if we decide to cease to act for you in such circumstances, you agree that we may decide
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