Litigants may be interested to know that there are circumstances in which a lawyer may be liable for legal costs incurred in connection with a matter.

Section 99 of the Civil Procedure Act 2005 (NSW) (“Act”) provides that a legal practitioner may be required to pay costs:

1)         … if it appears to the Court that costs have been incurred:

(a)        by the serious neglect, serious incompetence or serious misconduct of a legal practitioner, or

(b)        improperly, or without reasonable cause, in circumstances for which a legal practitioner is responsible

 

However, in White Industries (Queensland) Pty Limited v Flower & Hart [1998] FCA 806 the Federal Court of Australia articulated that a legal practitioner who pursues for their client a claim or defence which is likely to fail does not (without more) fall foul of section 99 of the Act.

Liability under section 99 of the Act requires an act or omission where the costs incurred have been a result of serious neglect, serious incompetence, or serious misconduct by the legal practitioner.

Examples include, but are not limited to, the following instances:

  • A legal practitioner’s failure to determine whether there are reasonable prospects of success.
  • A legal practitioner who pleads a defence for the sole purpose of delaying proceedings.
  • A legal practitioner who acts on a claim which appears to be a clear abuse of process.
  • A party’s non-compliance with Court orders being solely attributable to the conduct of that party’s solicitor.

Implications

Although the threshold is relatively high, if you feel that you have been severely disadvantaged by a solicitor’s conduct, you may have the option to pursue costs against that legal practitioner personally.