Client Care and Costs

Question 1

Client Care:

The Code of Conduct for Solicitors sets out the …… standards of service and competence
that a client can expect to receive. This links to Principle 7: a solicitor must act in the …..
……. of each client. This includes providing a proper standard of service. More generally,
the Code provides that a solicitor must not abuse their position by taking …… of clients
(Paragraph 1.2) or mislead or attempt to mislead a client either by their own acts or omissions
or allowing or being complicit in the acts or omissions of others (Paragraph 1.4).

The Code is not ….. on how a solicitor should comply with the obligations relating to
a standard of service, as different types of legal services providers will have in place differing
client care systems. Also, the introduction to the Code of Conduct for Solicitors makes clear
that a solicitor must exercise their own …… in applying the standards, bearing in mind
the solicitor’s areas of practice and the nature of the solicitor’s clients. So, for example, a
client providing instructions on a conveyancing matter is unlikely to need the same information
as a sophisticated commercial client who instructs the solicitor on a regular basis.

Answer 1

Minimum

Best interest

Advantage

Mislead

Prescriptive

Judgement

Question 2

Client Care:

A solicitor must give clients information in a way they can understand and ensure that clients
are in a position to make …… …… about the services they need, how their matter
will be handled and the options available to them (Paragraph 8.6).

Answer 2

Informed decision

Question 3

Level of Service:

The service provided by a solicitor must be ……. and delivered in a timely manner
(Paragraph 3.2).
A solicitor must maintain their competence to carry out their …. and keep
their professional knowledge and skills up to date (Paragraph 3.3).

In seeking to achieve a competent level of service, the solicitor must consider and take
account of the client’s attributes, needs and circumstances (Paragraph 3.4).

For example, in terms of the type and frequency of communications with a client during the matter, some
clients may want to be updated in writing on a regular basis, whilst some may want to hear nothing from a solicitor until a certain stage of a transaction has been reached.

Answer 3

competent

role

Question 4

The term ‘costs’ is defined in the SRA Glossary as meaning the solicitor’s …. and …….
Care must be taken in providing an accurate costs estimate. Aside from the professional
conduct implications, it may be the case that the solicitor will be held to the estimate:

Reynolds v Stone Rowe Brewer [2008] EWHC 497

A solicitor is obliged to provide clients with the best possible information about how their
matter will be …. and, both at the time of engagement and when appropriate as their
matter progresses, about the likely overall ….. of a matter and any costs incurred (Paragraph
8.7).

Answer 4

Fees and disbursements

Priced

Cost

Question 5

It will often be impossible to provide an accurate …… of the overall ….. of a matter at the start. However, just providing the client with details of the solicitor’s charge- out rate will rarely be …….. For example, if the only information the solicitor provides to a client is that the solicitor’s charge- out rate will be £200 per hour, the client will not know whether they will have to pay £200 for the matter to be finished (if the solicitor puts in one hour’s work) or £20,000 (if the solicitor puts in 100 hours’ work).

If a …… figure is not possible, it will often be prudent for the solicitor to explain why the ……. figure cannot be given and agree either:
(a) a ceiling figure, above which the solicitor’s costs cannot go, without the client’s
permission; or
(b) a review date when the parties will revisit the costs position.

The solicitor must not forget expressly to include ….. in any hourly rate or quote. For example,
a solicitor may quote the hourly rate as £200 plus VAT. If the solicitor fails to quote with VAT,
the price the client pays will be deemed to include VAT. Accordingly, if a solicitor were to say
that their charge- out rate was £200 per hour that is all that the client would be liable to pay.
The solicitor would have to pay the VAT element to HM Revenue and Customs from this £200,
and would therefore lose out.

Answer 5

estimate

cost

sufficient

precise x 2

VAT

Question 6

Where the solicitor wishes to charge the client for any such ……, the solicitor must have entered into a …. ….. with the client to that effect
(see Civil Procedure Rules, r 48.8(1A)).

The client will also remain liable to pay their solicitor’s costs where the losing party is unable
to meet the costs order. Again, it would be good practice for this to be made clear to the
client prior to starting any litigious proceedings.

Answer 6

Excess

Written Agreement

Question 7

There is a good deal of client care information which will need to be communicated to the client at the start of the matter. Some of this information is prescribed by the …… .. ……. for Solicitors (eg information on costs and complaints), some by other rules and regulations
(eg the Consumer Contract Regulations 2013) and some simply as a matter of …… ………

It is prudent for a solicitor to provide the necessary client care information to a client in ……, and traditionally this has been done in the form of a letter sent out to the client after
the first interview, known as the ‘…… ….. …..’.

Answer 7

Code of conduct

Good practice

writing

Client care letter

Question 8

Consumer Contracts Regulation 2013

The Regulations distinguish between ‘..-…….’ and ‘………’
contracts. Whilst most contracts will be concluded between a solicitor and the client
at the solicitor’s place of business (‘..-……..’), there may be situations which will result in the contract falling within the definition of an ‘off- premises’ contract, for example where a
solicitor visits a client at home and the client offers to engage the solicitor to carry out legal
work. Even if the offer is accepted by the solicitor telephoning the client from the solicitor’s
office the next day, this would be considered an ‘…….- premises’ contract.

Answer 8

On-Premises

Off-premises

Question 9

Consumer Contracts Regulation 2013

For example, where a
client has agreed to an ‘..-…….’ contract, the client must additionally be informed that
they have the right to cancel it without giving any reason or incurring any liability during the
cancellation period (which in most cases is .. days beginning on the date after the contract
is entered into). Failure to do so is an offence under the Regulations. For this reason, solicitors
need to ensure that if they are likely to enter into contracts in different types of circumstances,
their standard letters contain any ……. information required under the Regulations. Legal
aid contracts do not fall within the Regulations.

Answer 9

Off-premises

14

Additional

Question 10

Contentious legal work relates to a …… between two or more parties, which could involve ……., mediation or ……. (amongst others). Non-contentious legal work does not involve a ……. It could either be transactional, for example advising a party on the sale of their business or the grant of a tenancy, or it could be advisory, such as providing tax planning advice.

Accordingly, contentious business is work done in relation to ……. However, contentious business starts only once proceedings have been issued.

Answer 10

Dispute

Litigation

Arbitration

Dispute

Proceedings

Question 11

Three types of options available for solicitor’s fees:

Answer 11

Hourly rate
Fixed fee
Variable fees E.g. Contingency fee Agreement (Conditional)

Question 12

Agreements which are permitted by law are ……. fee agreements (CFAs) and …….. -based
agreements (DBAs).

Answer 12

Conditional

Damages

Question 13

s 58 Courts and Legal Services Act 1990 (see also the Conditional Fee Agreements Order 2013 (SI 2013/ 689)).

An example of a conditional fee agreement is the ‘no win, no fee’ basis of charging that is popular in areas of work such as personal injury. Under such an
agreement, the solicitor may agree to charge ….. if the client loses, but will charge their fees plus an agreed ‘…..’ (or ‘success fee’, for example an extra 20%) in the event of success.

For example, the agreement must be in ……, ……. by both the solicitor and the client, and, where a success fee is to be paid, specify the ……. of the success fee.

The success fee cannot exceed a percentage specified by the Lord Chancellor (currently 100% uplift in the normal hourly charge rate, with the exception
of personal injury cases where the ….. is 25% of general damages recovered)

Answer 13

Nothing

Uplift

Writing

Signed

Percentage

cap

Question 14

A DBA (defined by s 58AA(3)(a) Courts and Legal Services Act 1990 and covered by the
Damages- Based Agreements Regulations 2013 (SI 2013/ 609)) provides that, if the client
recovers damages, the solicitor’s fee is an …… ……. of those damages.

The DBA must not provide for a payment ….. an amount which, including VAT, is equal to 50% of the
sums ultimately recovered by the client. Also, personal injury cases are subject to a cap of 25% of the general damages recovered. The points made above in respect of combining a CFA with after- the- event insurance cover (or before- the- event insurance cover) apply equally to a …….

Answer 14

Agreed percentage

Above

DBA

Question 15

money on account means:

In contentious business, a solicitor may require a client to pay a reasonable sum to the solicitor on account of costs. If the client does not pay this money within a reasonable time, the solicitor may …… the retainer (Solicitors Act 1974, s 65(2)).
There is no such statutory right in …-……. business. Accordingly, where the solicitor
requires money on account before starting a matter, the solicitor should make this a
requirement of the retainer.

Answer 15

Paying upfront- At the start of the transaction.

Terminate

Non-contentious

Question 16

The Solicitors Bill

For a solicitor to be able to obtain …. from the client, certain formalities need to be complied with in respect of the solicitor’s bill. These matters include (but are not limited to) the following:
(a) The bill must contain enough …… for the client to be satisfied that the bill is
reasonable, and also provide details of the period to which the bill relates.
(b) The bill must be ….. by the solicitor or on the solicitor’s behalf by an employee authorised to do so. Alternatively, the solicitor/ authorised employee may sign a covering letter which refers to the bill (Solicitors Act 1974, s 69(2A)).
(c) The bill must be ……. by hand to the client, by post to the client’s home, business
address or last known address, or by email if the client has agreed to this method and provided an appropriate email address (Solicitors Act 1974, s 69(2C)).

Answer 16

Payment

Information

Signed

Delivered

Question 17

What are interim bills and when is it requested?

Answer 17

To bill the client for work done on the client’s file before the matter has completed. This will particularly be the case where the client’s matter is likely to go
on for some months, such as protracted litigation

Question 18

Two types of interim bills:

Answer 18

Statute bills and Bill on account

Question 19

An advantage of this type of interim bill is that it does not need to represent the …. figure for costs in respect of the work covered by it, so that when preparing
the statute bill at the end of the matter the solicitor can assess a fair ….. costs figure for all of the work done since the start of the retainer.

However, unlike with an interim statute bill, a
solicitor is unable to … the client for non- payment of such a bill, and the client cannot apply to have the bill assessed. If the client does not pay the bill on account within a reasonable
time then in contentious business the solicitor may terminate the retainer under s 65(2) Solicitors Act 1974. In the event that the client regards the amount of the bill as excessive, the client can request that the solicitor issues a …. bill which the client may then apply to have assessed by the court.

Answer 19

Final

Overall

Sue

Statute

Question 20

In a non- contentious matter a solicitor may charge interest on the whole or the outstanding part of an unpaid bill with effect from ….. month after delivery of the bill, provided that the client has been given notice of their right to challenge the bill. The rate of interest chargeable
must not exceed that which is payable on judgment debts.
At the time of writing the rate is currently 8%.

In contentious business, the Law Society’s guidance provides that a solicitor may charge interest on an unpaid bill where the solicitor expressly reserves this right in the …., or the client later agrees for a ‘contractual consideration’ to pay interest.

Alternatively, where a
solicitor sues the client for non- payment of fees, the court has the power to award the solicitor interest on the debt under s 35A of the Senior Courts Act 1981 or s 69 of the County Courts
Act 1984.

The rate of interest will be the rate payable for judgment debts unless the solicitor and client
expressly agree a different rate.

Answer 20

One

Retainer

Question 21

Enforcement of Solicitor’s Bill

Subject to certain exceptions, a solicitor may not commence any claim to recover any costs
due to the solicitor (such as suing the client) until …. month has passed since the solicitor delivered their bill (Solicitors Act 1974, s 69).

The bill must also be in the proper form.

However, the High Court has the power under s 69 to allow the solicitor to commence such a claim against the client within this one- month period where the court is satisfied that the client is about to leave the ….., be declared …… (or enter into a composition with their
creditors), or do anything else which would prevent or delay the solicitor obtaining their fees.

Answer 21

One

Country

Bankrupt

Question 22

The Client’s right to challenge the bill:

Assessment by the court

A client may apply to have the bill …… by the court in both contentious and non contentious proceedings. This is sometimes referred to as a bill being ‘….’.
The client must apply to have the bill assessed within …. month from the date of delivery.

Where no application is made within this month, the client may still apply within 12 months of delivery, but will require the ….. of the court for the bill to be assessed (Solicitors Act
1974, s 70).

The costs will be assessed by a judge or district judge sitting as a ‘…. …..’. The costs
officer has the power to assess the fees and disbursements of the solicitor.

Answer 22

Assessed

Taxed

One

Leave

Cost officer

Question 23

The Client’s right to challenge the bill:

Using the firm’s complaints procedure

Solicitors must ensure that clients are informed in ….. at the time of engagement about their right to complain about the service provided by them and their charges (Paragraph 8.3).

If the client is not satisfied with the firm’s response, the solicitor must inform the client in writing of any right the client has to complain to the …. …… (Paragraph 8.4).

The Legal Ombudsman may then limit the solicitor’s fees by, for example, directing the solicitor to refund
all or part of any amount paid, or to remit all or part of the fees (see 1.5).

Answer 23

Writing

Legal Ombudsman

Question 24

Non-contentious business agreements

A solicitor and client may enter into a non- contentious business agreement in respect of the solicitor’s …… for any non- contentious work.

Under this agreement the solicitor may be remunerated by a gross sum, commission, a percentage, a salary, or otherwise.
To be enforceable, the agreement must comply with s 57 Solicitors Act 1974.

For example, the
agreement must:
(a) be in .....;
(b) be ..... by the client;
(c) contain all the ..... of the agreement (including whether disbursements and VAT are
included in the agreed remuneration).

Where the relevant provisions have been complied with, the client will be unable to apply to
have the bill assessed by the court. However, the court may set the agreement aside if the
amount charged by the solicitor is …. or …….

Answer 24

Remuneration

Writing

Signed

Terms

Unfair

Unreasonable

Question 25

Contentious business agreements

A solicitor may enter into a contentious business agreement in respect of their remuneration for contentious work completed on behalf of the client (Solicitors Act 1974, ss 59– 63).

The agreement may provide for the solicitor to be remunerated by reference to a gross sum,
an hourly rate, a salary or otherwise. However, the solicitor may not be remunerated by a
……. fee.

In order to be enforceable, the agreement must comply with certain requirements, including:

(a) the agreement must …. it is a contentious business agreement;
(b) the agreement must be in ….;
(c) the agreement must be …… by the client; and
(d) the agreement must contain …. the terms.

Where the contentious business agreement is enforceable, the client will be unable to apply
to court for an assessment of costs (except where the agreement provides that the solicitor is to be remunerated by reference to an hourly rate).

However, the court may set aside the
agreement if it is unfair or unreasonable.

Answer 25

Contingency fee (conditional fee)

State

Writing

Signed

All

Question 26

“I note, for example, that the Law Society’s model form CFA for personal injury and clinical negligence cases contains a specific clause providing that the agreement is not a …… ……. …….. within the terms of the 1974 Act.

Answer 26

Contentious business agreement