berthahenson

Over-charging over over-charging Part 3

In Money, News Reports on October 16, 2014 at 8:45 am

I have got to say I found the Law Society’s letter to the ST Forum Page, Don’t equate reduction of costs with over-charging, pretty annoying.

It starts by talking about how “much ink has been spilled following recent claims of overcharging by lawyers representing the Singapore Medical Council’’. I wouldn’t call a grand total of two letters “much ink’’. I guess my definition of “much’’ isn’t quite the same as the Law Society’s.

It goes on to say: “Without commenting on specific cases before the court and the inquiry committee, it appears necessary to explain the process to the public.’’

(Thank you very much but could you drop the condescending tone? In any case, I don’t think the explanation was very full.)

It then explains the “taxation’’ process. In a nutshell, a lawyer charges a sum of money to a client. Say, he wins the case for his client, then his bill goes to the loser, who can challenge it.

The quantum determined by the court is an amount that the losing party ought reasonably to pay, and not what a lawyer may reasonably charge the client.’’

I am not sure what that means. I guess it is something like this: What a lawyer might charge a client, isn’t the same as what the losing party pays the client (winning party) to defray fees of the lawyer. So if your client has deep pockets, the lawyer is in luck. Because the loser pays whatever amount that is “taxed’’ and I suppose the client foots the rest of the bill.

Then it tells us that we shouldn’t be surprised if there is a difference: “The law actually intends that there will be an appreciable margin between what a losing party pays in taxed costs, and what a winning party has to pay its lawyers. It is an attempt to reach a fair balance between the victor and the vanquished. ‘’

The question then is what is an “appreciable margin’’ – 10 per cent? 20 per cent? 100 per cent? And does the law really intend to have an appreciable margin? I didn’t know that! Yes, yes, I am not a lawyer.

It goes on: “In practice, most bills of costs submitted for taxation are reduced. The winning party’s lawyers have a duty to seek the highest quantum reasonably arguable, and the losing party’s lawyers have a duty to seek the highest possible reduction of those claimed costs. The court will balance both views and decide. That a winning party’s bill of costs was reduced on taxation should not automatically be construed as overcharging.’’

What a strange bargaining process! Keeps the judges busy…But this only happens if the losing side disputes the bill and brings it up to the court no? And the loser needs a lawyer to argue the bill down? What then is the definition of over-charging? How much above the appreciable margin should this be to be construed as “overcharging’’.

According to Rule 38 of the Legal Profession (Professional Conduct) Rules on Gross Overcharging: An advocate and solicitor shall not render a bill (whether the bill is subject to taxation or otherwise) which amounts to such gross overcharging that will affect the integrity of the profession.

I would have thought the Law Society would have referred to the above in its letter as part of its explanation of the difference between fee taxed down and overcharging. It would have been educational. And give examples please.

It also goes on to say that “if a client is dissatisfied with his lawyer’s bill, he can also tax that bill in court’’.

So you hire another lawyer to bring down your original lawyer’s fees?  Wow! I wonder if this is common practice? (Is this what the Singapore Medical Council should have done in the Susan Lim case? Or did it think the fees of $1m plus charged twice is a reasonable fee for the SMC to pay? Ooops! Wrong of me to refer to specific cases…)

Final paragraph: “The Law Society does not condone overcharging by lawyers, and complaints about overcharging are subject to a statutory regime. Complaints made to the Law Society are referred to independent committees for investigation. These committees are not appointed by the Law Society, and it has no control over them.  The public can have every confidence that there are long-established safeguards in place to address overcharging, whether by one’s own lawyer or by an opposing lawyer.”

Isn’t that so odd? There is an independent committee, which the Law Society has no control over, to deal with complaints. Which makes you wonder why the Law Society is spilling ink at all. LawSoc could at least give more details on how these committees work or the results of its work.

Here’s my response to the Law Society letter:

Much ink has been spilled by the Law Society on the general process of taxation by the courts. Without commenting on specific cases before the court and the inquiry committee, it appears necessary for the Law Society to elaborate on the phrase “appreciable margin’’ and define the term “over-charging’’. It might also be appropriate to disclose statistics on complaints of over-charging (after taxation and not through fraud or other action) and how many were acted on. This is so as that the public can have every confidence that there are long-established safeguards in place to address overcharging, whether by one’s own lawyer or by an opposing lawyer.

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