Legal Aid Commission Act Part 3

“(1) In this Part, application means an application for legal aid made to the Commission.

(2) In this Part, a reference:

(a) to an applicant for legal aid is a reference to a person on whose behalf legal aid is sought,

(c) to the ordinary professional cost of a legal service is a reference to the usual cost of the legal service if provided by a private legal practitioner, and

(d) in relation to an application, to a party to proceedings, includes a reference to a person who, in the opinion of the Commission, may become a party to proceedings”.

“(1) Except to such extent, if any, as the Commission may otherwise determine in accordance with subsection (2) or (4), legal aid shall be provided by the Commission in accordance with this Part.

(2) The Commission may, from time to time, determine that legal aid in respect of such matters or classes of matters as the Commission determines shall be provided by the Commission on such terms and conditions as the Commission determines, and that legal aid may be provided accordingly

(3) Without limiting the generality of subsection (2), the terms and conditions referred to in that subsection may include terms and conditions that the legal aid shall be provided without charge, without means tests or other tests and without the necessity for compliance with such formal or procedural requirements of this Part as the Commission may determine

(4) Where the Commission determines in accordance with subsection (2) to provide legal aid in the form of a grant of money for specified purposes, sections 34 (6)–(8), 41 and 47 do not apply to the provision of the legal aid if the Commission, in the terms and conditions on which that legal aid is provided, so determines”.

Provision of legal aid

Legal Aid NSW must provide legal aid in accordance with Part 3.

Section 30 enables Legal Aid NSW to attach terms and conditions to any grant of legal aid.

Lump sum grants

Sections 30(2) and (4) enable Legal Aid NSW to provide legal aid as a lump sum fee for specified purposes. Subsection (4) makes it possible for Legal Aid NSW to make a lump sum grant to assist a party to run a case.

Conditions of a lump sum grant of aid

If Legal Aid NSW determines to makes a lump sum grant of aid, in doing so, it may also determine whether s 34 (6)-(8),s41, or s47 will apply.

Legal Aid NSWs policy is to exclude the operation of these sections. However, the client must be notified of this in the letter when advising of the determination of the grant.

See Types of Grants of Aid chapter for policies in relation to lump sum grants.

See clause 4 of the Delegation Instrument for Legal Aid NSW officers authorised to make lump sum grants.

Departing from means and merit test in grants of legal aid

Subsection 30(3) of the Act gives Legal Aid NSW express discretion to not apply a means or merit test in certain applications for legal aid.

Legal Aid NSW Merit Test policy sets out the test for merit.

Legal Aid NSW Means Test policy sets out the policy for the means test.

“(1) A person may apply to the Commission for legal aid.

(2) Nothing in subsection (1) prevents a person from making an application on behalf of another person

(3) An application is to be made in the manner and form approved by the Commission”.

Anyone can make an application on behalf of another person.

Commentary

See clause 4 of the Delegation Instrument for Legal Aid NSW officers authorised to accept an application for legal aid which is not in the approved format.

A person shall not make an application knowing that it is false in any material particular.

Maximum penalty—50 penalty units or imprisonment for 6 months.

Commentary

There is a penalty under section 32 of the Act for making a false application in an application for a grant for legal aid.

This section only applies to false application it does not relate to failing to provide updated information.

Legal Aid NSW may undertake investigations and prosecutions for offences under this section of the Act.

(1) On receipt of an application, the Commission may—

(a) make such inquiries as it thinks fit as to the means and circumstances of the applicant and of each person who is associated with the applicant for the purposes of any means test under section 35,

(b) require the applicant to furnish such information, in addition to the information furnished in the application, and produce such books or documents as the Commission specifies,

(c) require the applicant to attend personally,

(d) refer the application or any matter relating to or arising from the application to a person (including a barrister or solicitor) nominated by the Commission for investigation, report or advice, and

(e) take such steps as may be necessary to conserve the interests of the applicant pending the determination of the application.

(f) (Repealed)

(2) The Commission may defray expenses incidental to any of the matters referred to in subsection (1) from money available to the Commission or require the applicant to meet those expenses. A requirement that the applicant meet those expenses may be imposed at any time after receipt of the application but not later than the making of a determination in respect of the person under section 46.

(3) An amount required to be paid under subsection (2) must be paid in such manner, and within such time, as the Commission directs.

(4) The Commission may recover an amount payable to it under subsection (2), and any interest payable in respect of the amount, as a debt in a court of competent jurisdiction.

Commentary

Section 33(1) of the Act authorises Legal Aid NSW to investigate a range of matters before it determines an application for legal aid.

On receipt of a legal aid application, prior to determining the application Legal Aid NSW may, under s 33 of the Act:

make such inquiries as it thinks fit as to the means and circumstances of the applicant, and each person who is associated with the applicant under the means test
require the applicant to furnish such information, in addition to the information furnished in the application, and produce such books or documents as Legal Aid NSW specifies
require the applicant to attend personally
refer the application or any matter relating to or arising from the application to a person (including a barrister or solicitor) nominated by Legal Aid NSW for investigation, report or advice, and
take such steps as may be necessary to protect the interests of the applicant pending the determination of their application.

Expenses incurred by Legal Aid NSW under s33

Legal Aid NSW under section 33(2) and (3) of the Act:

may pay, or
may require the applicant for legal aid to pay

for expenses incurred by Legal Aid NSW under s 33 of the Act.

Payment of expenses incurred under s 33 will only be required if legal aid is granted after these inquiries. Any legal practitioner's costs and disbursements incurred by Legal Aid NSW will normally be included in a s46 contribution or taken from any party/party costs paid to Legal Aid NSW.

Where expenses are incurred by Legal Aid NSW under s 33(1), Legal Aid NSW staff should notify the applicant's legal practitioner or the applicant, in writing that these deductions may be made.

Obtaining Counsel's advice

Under s 33 of the Act Legal Aid NSW frequently authorises the obtaining of counsel's opinion or further investigations, at the expense of Legal Aid NSW, before determining whether legal aid should be granted or refused.

If legal aid is granted after s 33 enquiries, any legal practitioner's fees, disbursements and Counsel's fees paid by Legal Aid NSW under s33 of the Act will then normally be deducted from:

any moneys paid to Legal Aid NSW under s 46 of the Act and/or
any party/party costs paid to Legal Aid NSW.

Section 33 authorisation is not a grant of legal aid

An authorisation to grant expenses under s 33 is not a grant of legal aid. The various sections of the Act which apply to grants of legal aid do not apply to section 33 authorisations. For example:

s 34(4) - giving written notice to the applicant of his/her right to appeal against a determination or
the benefits conferred by s 47 - payment of costs awarded against a legally assisted person.

Who can authorise a s33 payment

Legal Aid NSW officers authorised under clause 6 of the Delegation Instrument can authorise s 33 payments.

“(1) The Commission shall determine an application by granting the application unconditionally or subject to conditions or by refusing the application. The Commission may at any time redetermine an application that has been refused

(2) The Commission shall give notice to the applicant of the determination or redetermination of the application as soon as practicable (and in any case not later than 14 days) after the determination or redetermination is made

(3) A notice given under subsection (2), except where:

(a) the application relates to proceedings in a Local Court with respect to a criminal offence, or to such other proceedings as the Commission may from time to time determine, and is granted unconditionally, or

(b) the application relates to proceedings in a Local Court with respect to a criminal offence, or to such other proceedings as the Commission may from time to time determine, and is refused wholly or partly on the ground that the applicant fails to satisfy such means test as is determined by the Commission for the purposes of section 35 (1),shall be in writing.

(4) Where a person or committee acting in pursuance of a delegation or authorisation under section 69 grants an application subject to conditions or refuses an application, other than an application referred to in subsection (3) (b), the person or committee shall, in the notice given under subsection (2), inform the applicant that he or she has a right of appeal to a Legal Aid Review Committee against the determination or redetermination by the person or committee of the application.

(4A) Subsection (4) does not apply in respect of any condition of the kind referred to in section 56 (1AA) that is imposed on the grant.

(5) Where a person or committee referred to in subsection (4) grants an application subject to conditions or refuses an application, other than an application referred to in subsection (3) (b), the person or committee shall record the reasons for the determination or redetermination of the application

(6) As soon as practicable after the commencement of proceedings (not being proceedings with respect to a criminal offence), a solicitor acting on behalf of a legally assisted person shall give notice to the other parties, if any, to the proceedings of the fact that the solicitor is acting for a legally assisted person.

(7) Where the solicitor referred to in subsection (6) is a private legal practitioner, the solicitor shall advise the Commission in writing, within 7 days of giving notice under that subsection, that notice has been given.

(7A) If an application for legal aid is made after the commencement of the proceedings to which the application relates, the Commission may give notice to the other parties, if any, to the proceedings of the receipt of the application.

(8) A notice given under subsection (6) or (7A):

(a) shall be in writing,

(b) shall contain a reference to the effect of section 47, and

(c) may be given in any manner authorised for the service of process in the proceedings to which the notice relates”.

Commentary

Once an application is received, Legal Aid NSW must determine it in one of three ways:

it may grant the application in full,
grant it with conditions, or
refuse it.

Who can make a determination to grant legal aid?

Legal Aid NSW officers authorised under clause 9 of the Delegation Instrument can make determinations to grant legal aid.

Redetermining grants of aid

Legal Aid NSW can redetermine a legal aid application which has been refused. If an officer has a delegation to determine a legal aid application, that officer may redetermine the application if it is refused.

See clause 9 of the Delegation Instrument for who has the authority to make the redetermination concerning the same application.

Notifying applicant in writing

Under s 34(2) and (3) of the Act, Legal Aid NSW is required (except for matters under s 34(2)(a) and (b)) to give notice in writing to the applicant for legal aid about its determination or redetermination.

Applicant's right of appeal

If the determining officer refuses to grant legal aid or attaches conditions to the grant, the determining officer must advise the client in writing of their right to appeal except if it is a grant under s 34(2)(b) of the Act.

Exceptions to right of appeal

The applicant has no right of appeal against a condition of a grant of legal aid where the only condition involves legal assistance being provided in-house, by the Public defender or assigned to a private legal practitioner (subsection 4A ): See s56(1AA) of the Act.

See Representation chapter for policies relating to the allocation and assignment of legal work between in-house and private legal practitioners.

An applicant has no right of appeal against a determination:

if the condition of grant of aid is the payment of a contribution in a Local Court criminal matter: s56(1A)(b)
when the application has been refused partly or wholly on means where the applications is for a local court criminal offence,
the decision of Legal Aid NSW to assign the grant to an inhouse or private lawyer: s 56(1AA), or
against the provision of legal aid on a lump sum fee basis as this is neither a condition or variation of a grant of legal aid: s34C of the Act.

Record reason for decision

The person or committee who grants an application subject to conditions, or refuses an application (other than an application referred to in s 34(3) (b) of the Act) is obliged under s 34(5) of the Act to record its reasons.

Mandatory notifications under s34

The notices required under subsections 34(2), (6) and (7) are mandatory. The notice under subsection (7A) where Legal Aid NSW has received an application for legal aid after proceedings have commenced is discretionary.

Legal Aid NSW officers should give this notice if an application is received by Legal Aid NSW close to the hearing of the matter, or the other party/ies could be affected by section 47 if legal aid is subsequently granted.

Private legal practitioner must notify other parties if client legally assisted

A private legal practitioner must inform other parties in the proceedings that the client is legally assisted and advise Legal Aid NSW that notice under s34(6) has been given to the other parties in the proceedings within 7 days of giving the notice.

In Milat v Legal Aid Commission (1995) SC 30026/95 25 May 1995 Simpson J held that a letter outlining conditions of a proposed grant did not amount to a determination or notice of determination under section 34(1) or (2).

Notice of receipt of legal aid application

Under s 34(7A) of the Act, Legal Aid NSW has a discretion to give notice to other parties of the receipt of a legal aid application if proceedings have already commenced. The notice must be in writing and advise the parties of the affect of s47 of the Act. The Notice may be given in any manner authorised for service of process in the proceedings to which the notice relates.

Appeals to LARC

If there is an appeal to a Legal Aid Review Committee (LARC) against a determination to refuse legal aid and the officer preparing the report to LARC considers aid should be granted, that officer may grant aid. Any such determination is a redetermination of the original application, and may itself be subject to an appeal. An appeal to a LARC lapses if Legal Aid NSW grants the application on a redetermination.

If the officer preparing the report to a LARC considers that the refusal should stand, this does not amount to a redetermination and the original appeal still stands. Where LARC has upheld a Legal Aid NSW decision to refuse legal aid a redetermination is only to occur in exceptional circumstances.

See Appeal chapter for policy and guidelines on appeals to LARC.

“(1) The Commission may, when granting an application for legal aid, determine that the application shall be deemed to have been granted at any time on or after the date on which the request for legal aid was made, whether or not an application for legal aid was duly made on that date(2) The Commission shall be deemed always to have had the power conferred by this section”.

Commentary

Date of Grant of Aid

Under s34A(1) of the Act, Legal Aid NSW, at the time of granting legal aid, may determine that a grant of aid is deemed to have been granted on or after the date on which the request for aid was made whether or not the application was duly made on that day.

The date from which legal aid is to apply should be considered carefully particularly where legal aid is granted as a result of a redetermination as the date of grant may affect the legally assisted person's indemnity under s 47 of the Act.

The date of commencement of a redetermined grant may also affect expenses or fees requested by the private legal practitioner under s 41 of the Act.

See Types of Grants chapter for policies and guidelines on dating grants.

No retrospective grants

Legal Aid NSW does not have the power to make retrospective grants to cover an applicant's costs and liabilities before the date a request for legal aid was made.

The Legal Aid NSW policy is that the grant dates from the date of receipt of a written application or submitted in Grants Online or the date of request for an emergency grant.

Where a grant is determined following a LARC appeal the date will generally be the date of receipt of the original application. For circumstances in which Legal Aid NSW may determine a different date.

“(1) The power of the Commission to impose conditions on the grant or provision of legal aid to a person extends to authorise the imposition of a condition requiring the person:

(a) to provide, or to enter into an agreement to provide, security to the satisfaction of the Commission for the payment of amounts payable or which may become payable by the person to the Commission under this Act, and

(b) to pay any expenses incurred by the Commission by way of stamp duty, registration fees and other disbursements in connection with the provision of any such security or the entering into of any such agreement.

(2) The Commission is empowered to take such action as may be necessary or expedient for or in connection with the due enforcement of any such security or agreement

(3) If a condition is imposed under subsection (1) (b), the person must pay the required amount in such manner and within such time as the Commission directs and it may be recovered by the Commission from the person as a debt in a court of competent jurisdiction

(4) To remove any doubt, it is declared that the amounts payable by a person to the Commission under this Act include any interest payable in respect of those amounts under section 71A.

Commentary

Section 34B of the Act, confers on Legal Aid NSW the power to seek a charge over property of a legally assisted person as a security for payment of expenses.

See Contributions guideline at 6.4 for policies on securing contributions.

Security of costs

If Legal Aid NSW requires security for costs this would not of itself create a contractual relationship which would make Legal Aid NSW liable for proceedings in the Consumer, Trader and Tenancy Tribunal under consumer credit legislation.

Recovery of debts

Legal Aid NSW can take any reasonable action necessary to recover debts owed by a legally assisted person in relation to a grant of legal aid.

“(34C)The determination of a lump sum fixed amount as the amount to be paid to a private legal practitioner as fees for the legal services to be provided by the legal practitioner to a legally assisted person does not of itself constitute the imposition of a condition on, or a variation of, the grant of legal aid”.

Lump sum fixed amount

If Legal Aid NSW determines to pay the applicant's private practitioner a lump sum fixed amount as payment for legal services this is not to be treated as a condition of grant of aid for the purpose of ss 34(1) and 34(5) of the Act or 34B of the Act. There is no right of appeal to LARC against a decision under this section.

See Types of Grants chapter for policy on lump sum grants.

"(1)The Commission shall not, unless it is of the opinion that there are special circumstances relating to the property or means of the applicant or otherwise, grant an application unless the applicant, and each person who is associated with the applicant, satisfies such means test or other test as is determined by the Commission in respect of applicants generally or the class or description of applicants to which the applicant belongs and is applicable as at the date on which the application was made.

(2)A means test determined by the Commission for the purposes of subsection (1) is to be determined having regard to the ability of:

(a) applicants generally or applicants of the class or description of applicants in respect of whom the means test is determined, and

(b) persons associated with such applicants, to meet the ordinary professional cost of the legal services sought by the applicant.

(3)For the purposes of subsection (1), special circumstances may include:

(a) that the applicant is a party to proceedings as a member of an unincorporated association, or

(b) that the applicant is a party to:

(i) proceedings relating to environmental matters,

(ii) a relator suit, or

(iii) a test case.

(4)For the purposes of any means test determined under this section, a reference to a person who is associated with an applicant is a reference to such of the following persons or classes of persons as are specified by the means test as being associated with the applicant:

(a) the applicant's spouse or the applicant's de facto partner,

(b) any person who is financially responsible for, or who provides financial support to, the applicant,

(c) if the applicant is a corporation, any person whose financial interests will, in the opinion of the Commission, be directly and beneficially affected if the proceedings in respect of which legal aid is granted to the applicant are successful,

(d) if the applicant is applying as a member of an unincorporated association, any other member of the association whose financial interests will, in the opinion of the Commission, be directly and beneficially affected if the proceedings in respect of which legal aid is granted to the applicant are successful, and

(e) if the applicant is applying for legal aid in respect of proceedings under the Family Provision Act 1982, any other person whose interests will, in the opinion of the Commission, be beneficially affected if legal aid is granted to the applicant”.

Commentary

Legal Aid NSWs Means test takes into account the ability of an applicant and associated persons to meet the ordinary professional costs of the legal services sought by the applicant.

Means Test

Under s35(1) of the Act, Legal Aid NSW must apply the relevant means test when making a determination to grant legal aid unless Legal Aid NSW is satisfied there are special circumstances relating to the property or means of the applicant or otherwise. The test applied is the test available at the time of the application or request for legal aid was made.

Special circumstances are described in s35(3) of the Act and may include where the applicant is a party to:

proceedings as a member of an unincorporated association
proceedings relating to environmental matters
a relator suit, or
a test case.

Determinations about whether there are special circumstances under s35(1) of the Act can only be made by those authorised under clause 15 of the Delegation Instrument.

“Associated persons” is defined in s35(4) of the Act.

“(1) In granting an application, the Commission may do either or both of the following:

(a) impose a condition that requires the applicant to pay such amount to the Commission by way of contribution to the costs and expenses of the legal services sought by the applicant as the Commission determines,

(b) determine the maximum amount the applicant will, subject to section 47, be required to pay to the Commission towards the costs and expenses of a party to any proceedings brought by or against the applicant if, in relation to those proceedings, the party obtains an order for costs against the applicant.

(2) An amount required to be paid under subsection (1) shall be paid in such manner, and within such time, as the Commission directs.

(3) If a person who is or has been a legally assisted person fails to pay an amount payable under subsection (1), the Commission may recover the amount, and any interest payable in respect of the amount, from the person as a debt in a court of competent jurisdiction”.

Commentary

Under s 36 of the Act Legal Aid NSW may determine the initial amount a legally assisted person is to contribute to the costs and expenses of their legal matter. The amount of contribution to be paid is assessed through the Means Test.

Contribution towards an adverse cost order

Under s 36(1)(b) of the Act, Legal Aid NSW may determine the maximum amount a legally assisted person will be required to contribute towards costs paid by Legal Aid NSW under s47 of the Act in the event the applicant has an adverse costs order made against them.

See Contributions policies and Contributions guidelines for information on contributions.

Exempt matters

For matters exempt from initial contributions see the Contributions policy 6.2.4.

Notifying Clients

When granting legal aid Legal Aid NSW officers are to ensure that any contributions assessed under section 36(1) of ther Act are clearly set out in the grant letter and the timeframe in which the contribution is to be paid. This applies to both in-house and assigned matters.

Collecting s36 contribution

Contributions must be paid in the manner and within the time Legal Aid NSW determines. Legal Aid NSW can recover a contribution, with interest (s71A), in any court of competent jurisdiction.

Waiving or varying a contribution

Legal Aid NSW officers authorised under clause 17 of the Delegation Instrument can vary or waive an initial contribution.

The amount a Legal Aid NSW officer can vary a contribution is authorised under clause 18 of the Delegation Instrument.

“(1) Nothing prevents the Commission from granting an application made by:

(a) a party to proceedings where legal aid has been granted to another party to the same proceedings

(b) a corporation if the Commission is of the opinion that the legal aid granted will protect the interests of other persons who are eligible for legal aid,

(c) a person involved in an inquiry or investigation, being an inquiry or investigation established by or under an Act, an Imperial Act or an Act of the Parliament of the Commonwealth or by a Minister of the Crown for New South Wales or the Commonwealth, or

(d) a person whose interests are, or may be, adverse to the Crown in right of New South Wales or of the Commonwealth or a statutory body representing the Crown in right of New South Wales or of the Commonwealth.

(2) Where the Commission grants an application pursuant to subsection (1) (a), a solicitor employed by the Commission shall not act for more than one party to the same proceedings if to do so would create a conflict of interests”.

Commentary

Legal Aid NSW can grant legal aid to more than one party in the same proceedings.

“(1) The grant of legal aid to a person may, at any time, be varied by the Commission so as to

(a) terminate the provision of the legal aid,

(b) alter the nature or extent of the legal aid,

(c) make the provision of the legal aid subject to a condition or an additional condition (including a condition of the kind referred to in section 36 (1) (a)), or

(d) alter a condition (including a condition of the kind referred to in section 36 (1) (a)) to which the provision of the legal aid is subject.

(1AA) The Commission may at any time redetermine the variation of a grant that terminates the provision of legal aid.

(1A) In the exercise of its power to vary such a grant, the Commission may:

(a) make such inquiries as it thinks fit as to the means and circumstances of the legally assisted person and of each person who would be associated with the legally assisted person for the purposes of any means test under section 35 were the legally assisted person still an applicant for legal aid,

(b) require the legally assisted person to furnish such information, and to produce such books or documents, as the Commission specifies,

(c) require the legally assisted person to attend personally, and

(d) refer any matter relating to or arising from the legal services provided to the legally assisted person under the grant to a person (including a barrister or solicitor) nominated by the Commission for investigation, report or advice.

(2) Where a grant is varied under subsection (1), the Commission shall give notice, in writing, of the variation within 14 days after the variation is made to the person in respect of whom the variation is made and the solicitor acting on behalf of that person

(3) Where a grant is varied under subsection (1) so as to terminate the provision of legal aid to a person, the Commission shall, in addition to the requirements of subsection (2), give notice, in writing, of the variation within 35 days after the variation is made to each solicitor acting for each party to any proceedings to which that person is a party or, where no solicitor acts on behalf of a party, to the party

(4) Where a grant is varied under subsection (1) by a person or committee acting in pursuance of a delegation or authorisation under section 69 in a way which adversely affects the person in respect of whom the variation is made, the person or committee making the variation shall, in the notice given under subsection (2), inform the person in respect of whom the variation is made that he or she has a right of appeal to a Legal Aid Review Committee against the variation.

(5) Where a grant is varied as referred to in subsection (4), the person or committee making the variation shall record the reasons for the variation of the grant.

(6) If a grant is varied under subsection (1) (c) or (d) so as to impose or vary a condition of the kind referred to in section 36 (1) (a), the amount required to be paid must be paid in such manner, and within such time, as the Commission directs. The Commission may recover the amount, and any interest payable in respect of the amount, as a debt in a court of competent jurisdiction”.

Commentary

Under s 38 of the Act Legal Aid NSW may vary a grant of legal aid at any stage during the life of the grant of aid. This includes varying a condition or conditions, contributions required or even terminating the grant of legal aid.

Legal Aid NSW officers authorised under clause 20 of the Delegation Instrument can vary a grant of legal aid.

Investigative powers

In exercising its power to vary a grant of legal aid Legal Aid NSW may investigate as it sees fit, the means and circumstances of the legally assisted person and any associated person. Legal Aid NSW is entitled to ask the person to attend Legal Aid NSW personally, answer specific questions and produce documentation requested. Legal Aid NSW may also refer the matter to another person, including a barrister or solicitor for investigation, report or advice.

Notification of varying a grant of legal aid

Legal Aid NSW must notify the client in writing of its determination (within 14 days) of its decision to vary a grant of legal aid.

Section 38 (3) does not require Legal Aid NSW to give reasons to other parties for varying a grant: Wentworth v Rogers (No 12) (1987) 9 NSWLR 400

Recording reasons

Legal Aid NSW is not required to give reasons for varying or terminating a grant.

However, under s 59(3) of the Act a Legal Aid Review Committee determining an appeal in relation to a variation or termination must record its reasons.

Whilst Legal Aid NSW is not required to provide reasons for terminating a grant of aid the court held that by mot making the client aware of the material it was relying on to do so, or providing the client with an opportunity to be heard was a denial of natural justice: Automatic Ticket Research (Vic) PL v Legal Aid Commission (1991) 22 ALD 590.

Terminating a grant of legal aid

Legal Aid NSW officers authorised under clause 20 of the Delegation Instrument can terminate a grant of legal aid.

Once legal aid is granted a legally assisted person is in receipt of a benefit and has a legitimate expectation that the benefit will be continued.

Procedural fairness in terminating a grant of aid

Before legal aid is terminated the client must be told, in detail, the matters of concern to the determining officer and given appropriate time to respond to the concerns raised.

Termination can only be made on grounds indicated as being of concern: See Automatic Ticket Research (Vic) Pty Limited v. Legal Aid Commission (1991) 22 ALD 590 R.

Consideration given to impact of terminating grant

An officer making a determination to terminate a grant of legal aid must consider the impact of the termination and in particular the fact it may render a former legally assisted person liable to pay the whole of the opponent's costs, including party/party costs incurred for the period when legal aid was current.

Legal Aid NSW must notify in writing within 35 days after the termination of legal aid is made to each legal practitioner acting for each party to any proceedings to which that person is a party or, where no practitioner acts on behalf of a party, to the party.

Legal Aid NSW may, at any time redetermine the termination of grant of aid. See Appeal chapter for policy and guidelines on appeals

“(1) Where:

(a) a legally assisted person or a private legal practitioner representing a legally assisted person becomes aware of a change in the means or circumstances of the legally assisted person or in any other matter relating to the grant of legal aid to the legally assisted person, and

(b) the change is of such a nature that the legally assisted person or private legal practitioner, as the case may be, ought reasonably to suspect that the Commission might terminate the provision of legal aid or alter the nature or extent of the legal aid,

the legally assisted person or private legal practitioner, as the case may be, shall forthwith notify the Commission in writing of the change.

(2) Subsection (1) has effect notwithstanding any privilege that may arise from the relationship between a solicitor acting in a professional capacity and the solicitor's own client”.

Commentary

Under s 38A the legally assisted person and their legal practitioner is obliged to notify Legal Aid NSW in writing of any change in circumstances which may affect the grant of aid. It is not an offence however not to notify Legal Aid NSW.

Failure to notify of any changes which may affect the grant of legal aid.

If a private legal practitioner to whom legal aid work has been assigned fails to notify Legal Aid NSW of any changes it may amount to professional misconduct: See New South Wales Bar Association v LH (No 2) [2005] NSWADT 156.

A notice under s38A(1) of the Act has to be given notwithstanding any privilege that may arise from the relationship between a legal practitioner and a client.

“(1) The Commission shall determine the fees to be paid by it to private legal practitioners to whom work is assigned by the Commission

(2) In determining the fees referred to in subsection (1), the Commission shall consult with and take into account the views of:

(a) the Bar Association in respect of fees to be paid to barristers, and

(b) the Law Society in respect of fees to be paid to solicitors.

(3) The fees referred to in subsection (1) shall, so far as practicable, consist of fixed amounts determined in respect of particular legal services.

(4) A fee determined under subsection (1) in respect of a legal service shall be less than the ordinary professional cost of the legal service.

(5) In determining fees under subsection (1), the Commission is subject to the requirements of any agreement or arrangement under section 72A”.

Commentary

Under s39 of the Act Legal Aid NSW can determine the fees paid to private legal practitioners to whom work is assigned: seeAttorney General v Milat (1995) 37 NSWLR 370

Legal Aid NSW must consult with the Bar Association and Law Society when developing policy around fees to be paid to private legal practitioners. Where practical fees should be fixed amounts for particular legal services.

The fees scale determined by Legal Aid NSW should be less than commercial rates (s 39(4)).

Fees in criminal matters

The Court of Criminal Appeal confirmed Legal Aid NSWs power to determine the fees paid to legal practitioners for criminal matters: Attorney General v Milat (1995) 37 NSWLR 370.

See Costs and Fees chapter for policies and guidelines on costs and fees.

“(1) To assist in the determination of costs of which the Commission has agreed to pay a proportion to a private legal practitioner to whom work has been assigned by the Commission, the Commission has the same rights to require the private legal practitioner to have a bill of costs assessed or taxed in relation to that work as it would have if the Commission (and not the legally assisted person on whose behalf the work was done) were the client of the private legal practitioner.

(1A) In addition, a person who is required to pay an amount under section 46 (1) has the same rights to require the private legal practitioner who provided legal services to the person as a legally assisted person to have a bill of costs assessed or taxed in relation to the work done by the practitioner on behalf of that person as the person would have if the person were not a legally assisted person.

(2) No objection shall be made under this or any other Act or law to the assessment or taxation of a bill of costs relating to work done on behalf of a legally assisted person on the basis that the costs were not incurred by the legally assisted person but were incurred by another person on his or her behalf.

Legal Aid NSW has a right, under s40 of the Act, to require a private legal practitioner to whom work has been assigned by Legal Aid NSW to have a bill of costs assessed or taxed as if Legal Aid NSW and not the legally assisted person were the client of the legal practitioner.

Commission officers authorised under clause 22.1 of the Delegation Instrument can make a decision to have Bill of Costs assessed or taxed.

Rights of client to have Bill of Costs assessed and s46 contributions

Under s 40(1A) of the Act a legally assisted person who is required to make a s46 contribution has a right to have the costs of the private legal practitioner assessed or taxed.

Legal practitioner's Bill of Costs must be acceptable to client

If Legal Aid NSW is imposing a contribution under s 46 of the Act, the assigned legal practitioner is to obtain the legally assisted person's acknowledgement that the legal practitioner's bill is acceptable. The legal practitioner to whom the matter is assigned must confirm the client's satisfaction with the Bill of Costs prior to submitting the Bill to Legal Aid NSW.

The legal practitioner must provide Legal Aid NSW with a copy of the legally assisted person's response or advise that acknowledgment was sought but no response received from the client within the required 30 days.

“(1) Despite any Act or law to the contrary, a private legal practitioner is not entitled to charge or recover from a legally assisted person any amount:

(a) by way of costs in respect of work assigned by the Commission to the private legal practitioner on behalf of that person, or

(b) by way of disbursements incurred on behalf of that person in connection with that work, except with the approval of the Commission

(2) A provision of any agreement (whether in writing or not and whether entered into before or after the commencement of this section):

(a) under which the operation of this section is excluded, modified or restricted, or

(b) which has the effect of excluding, modifying or restricting the operation of this section, is void”.

Private legal practitioners to whom work is assigned are prohibited from charging or recovering legal fees from a legally assisted person.

The Legal Aid NSW may determine that s41 does not apply if a grant for lump sum amount is made under s30(2) or (4) of he Act.

A private legal practitioner cannot enter into any agreement with a client to undermine this provision and any such agreement is void.

See Costs and Fees chapter for policies and guidelines on costs and fees.

Breaches of s41

A breach of s 41 of the Act, no longer carries a specific penalty. However conduct by a legal practitioner that breaches the section may attract professional disciplinary penalties.

Reporting breaches

A Legal Aid NSW officer who becomes aware of possible breach of s 41 should report the matter to the Grants Division.

See Forman & Anor v Rattray [2006] NSWSC 260, for decision concerning s41 of the Act.

See costs and fees chapter for policies and guidelines in relation to s 41 of the Act.

“A court or tribunal which may order the payment of costs in proceedings before it shall, where a legally assisted person is a party to any such proceedings, make an order as to costs in respect of the legally assisted person as if he or she were not a legally assisted person”.

Commentary

This provision requires a court or tribunal in making a cost order to make an order for costs for or against a legally assisted person as though they were not legally assisted.

Section 42 has the effect of ensuring that Legal Aid NSW is not limited to recovering costs at the level of the contribution made by the legally assisted person.

“(1) A court or tribunal may, on the application of the Commission, order a person who is or was a legally assisted person to pay to the Commission any money paid or payable by the Commission as the costs and expenses of the legal services provided to the person as a legally assisted person (including the fees of the legal practitioner who acted for the person, party and party costs and expenses under section 33) if the court or tribunal is satisfied that:

(a) the legal aid was obtained by fraud or misrepresentation, or

(b) the legally assisted person has acted improperly in bringing, defending or conducting any proceedings with which the legal aid is concerned.

(2) Such an application can be made to the court or tribunal that is hearing or has heard any proceedings with which the legal aid is concerned or to any other court of competent jurisdiction either during or after the conclusion of the proceedings. However, an application can only be made to a court or tribunal that can make an order as to costs.

(3) When an order is made under this section, the costs are to be assessed as if the person ordered to pay them were not a legally assisted person”.

Commentary

Legal Aid NSW can apply to a court or tribunal to seek an order to have a legally assisted person pay to Legal Aid NSW any cost incurred by Legal Aid NSW in the provision of legal aid if legal aid was obtained by fraud or misrepresentation.

A court or tribunal may order a person who is or was a legally assisted person to pay to Legal Aid NSW the costs and expenses of the legally assisted person.

Who can apply to a court or tribunal?

Legal Aid NSW officers authorised under clause 22.3 the Delegation Instrument can make the applications to the court or tribunal.

See Costs and Fees chapter for policies on costs.

“(1) The Commission may defer payment of any fees payable by it to a private legal practitioner in connection with proceedings in respect of which legal aid has been granted

(a) until the Commission is satisfied that the practitioner has taken reasonable steps to recover any party and party costs to which the legally assisted person is entitled, or

(b) until the conclusion of any official investigation in relation to:

(i) any alleged breach of this Act or the regulations by the practitioner,

(ii) any alleged fraud or misrepresentation by the practitioner in relation to the provision of legal aid or any such fraud or misrepresentation to which the practitioner is a party, or

(iii) any alleged improper action by the practitioner in bringing, defending or conducting any proceedings in relation to which legal aid has been provided or any such action to which the practitioner is a party, or

(iv) any matter concerning the assignment of work to, or the performance of work by, the practitioner as a member of a panel established under Division 2 of Part 3, or

(c) until the completion of any criminal or disciplinary proceedings commenced against the practitioner in respect of a matter referred to in paragraph (b).

(1A) A reference in subsection (1) (b) to an official investigation includes a reference to an investigation conducted by or under the authority of the Commission, but only if the Commission has given written notice to the legal practitioner concerned that the investigation is to be or is being conducted.

(2) Without affecting any other power of the Commission to refuse payment of any fees, the Commission may refuse to make a payment of any fees to a private legal practitioner in connection with proceedings in respect of which legal aid has been granted if any allegation referred to in subsection (1) (b) against the practitioner is substantiated in any criminal or disciplinary proceedings.

(2A) The power of the Commission to defer="defer" or refuse to make a payment to a private legal practitioner under this section applies only to the payment of fees in connection with the proceedings in respect of which legal aid has been granted and to which subsection (1) relates.

(3) A private legal practitioner is a party to any fraud or misrepresentation or to any improper action if the practitioner becomes aware of any such fraud, misrepresentation or improper action and fails to notify the Commission promptly of that fact.

(4) The Commission may reduce an amount payable by the Commission to a private legal practitioner by an amount payable by the private legal practitioner to the Commission”.

Commentary

Deferring payment of fees

Legal Aid NSW can defer payment of fees to a private legal practitioner in the circumstances set out in s43A(1) of the Act. This power is in addition to any other power of Legal Aid NSW to refuse payment of any fees

What fees does it to?

The power to defer in s 43A(1) only relates to those fees in the matter subject to investigation (subsection 2A). It does not relate to other work that may have been assigned to the practitioner by Legal Aid NSW.

Refusing to pay legal practitioner's fees

Under s43A(2) of the Act Legal Aid NSW may refuse to pay any fees to a private legal practitioner for proceedings where legal aid has been granted, if any allegation referred to in s43(1)(b) of the Act against the practitioner is substantiated in any criminal or disciplinary proceedings.

Who can defer or refuse to pay fees?

Legal Aid NSW officers authorised under clauses 22.4 to 22.6 the Delegation Instrument can make a determination to defer payment of fees

See Costs and Fees chapter for policies on costs.

“(1) This section applies to a private legal practitioner against whom an allegation referred to in section 43A (1) (b) (i) or (ii) is substantiated in any criminal or disciplinary proceedings.

(2) A court or tribunal may, on the application of the Commission, order a private legal practitioner to repay to the Commission the whole, or part, of any money paid by the Commission to the practitioner in connection with proceedings for which legal aid has been granted and to which the allegation relates.

(3) Such an application can be made to the court or tribunal that is hearing or has heard any proceedings with which the legal aid is concerned or to any other court of competent jurisdiction either during or after the conclusion of the proceedings. However, an application can only be made to a court or tribunal that can make an order as to costs”.

Commentary

Legal Aid NSW can apply to a court or tribunal to seek an order to have a private legal practitioner repay Legal Aid NSW the whole or part of the money paid by Legal Aid NSW to the practitioner in relation to a grant of legal aid.

When can an application under s 43B be made?

Applications under s 43B are limited to allegations of fraud, misrepresentation or improper conduct under s 43A(1) that are substantiated in criminal or disciplinary proceedings.

Who can apply to a court or tribunal?

Legal Aid NSW officers authorised under 22.7 the Delegation Instrument can make the application.

See Cost and Fees chapter for policies on s43.

“(1) The Commission may, by notice in writing, direct a legally assisted person or a private legal practitioner acting for such a person to pay to the Commission the whole, or such part as is determined by the Commission and specified in the notice, of any money recovered by or on behalf of the person in any proceedings in respect of which legal aid was granted to the person.

(2) An amount required to be paid under subsection (1) must be paid in such manner, and within such time, as the Commission directs.

(3) The Commission shall account to a legally assisted person referred to in subsection (1) and any private legal practitioner so referred to in respect of money paid to it under subsection (1).

(4) The Commission may, in respect of money paid to it by a legally assisted person or a private legal practitioner under subsection (1):

(a) deduct any amount payable to it under this Act by the person, and

(b) offset the amount of any fees payable by it to any private legal practitioner in connection with the proceedings in which the money was recovered against any other money held by the practitioner in relation to the same proceedings.

(5) The Commission may recover an amount payable to it under subsection (1), and any interest payable in respect of the amount, as a debt in a court of competent jurisdiction.

(6) In this section, money includes a cheque”.

Commentary

Legal Aid NSW may by written notice direct a legally assisted person or their legal practitioner to pay Legal Aid NSW the whole or specified part of any money recovered by or on behalf of the legally assisted person in proceedings for which legal aid has been granted. private legal practitioner

Legal Aid NSW may deduct from the money any amount payable to it under the Act by the legally assisted person and offset the amount of any fees payable by it to any private legal practitioner in connection with the proceedings in which the money was recovered against any other money held by the practitioner for the same proceedings which may include for example an initial contribution.

Proceedings to recover money

Legal Aid NSW may take proceedings to recover money not paid under s 44 of the Act, and any interest, as a debt in a court of competent jurisdiction.

Who can direct payment?

Legal Aid NSW officers with authority under clause 22.8 of the Delegation Instrument can direct a client or private legal practitioner to pay.

See Costs and Fees chapter for policies on costs.

“(1) Where:

(a) a court or tribunal has made an order directing the payment of money (whether or not being or including an order as to costs) in favour of a legally assisted person, or

(b) money is otherwise recoverable by a legally assisted person (whether or not in a proceeding or by virtue of a settlement or compromise), and the person fails, within such time as the Commission thinks reasonable, to recover the money, the Commission may, by notice in writing, direct the person to assign his or her right to recover the money, or such part of it as is specified in the notice, to the Commission within a period of 21 days after the date of the notice.

(2) Where a legally assisted person fails to comply with a notice given to him or her under subsection (1), the person shall be deemed, at the expiration of the period referred to in subsection (1), to have assigned to the Commission the right to recover the money in respect of which the notice is given and the Commission may do and suffer all such things as the person could, but for this subsection, have been able to do or suffer in order to recover that money.

(3) The Commission must account to the legally assisted person in respect of money recovered by it under this section”.

Commentary

Legal Aid NSW may by written notice require a legally assisted person to assign their right to recover costs or other money recoverable as an award or settlement to Legal Aid NSW.

Failure to comply with a Notice to Assign

If the legally assisted person fails to comply with a notice after 21 days they will be deemed to have assigned their right to recover the moneys referred to in the notice to Legal Aid NSW and Legal Aid NSW has the power to take necessary recovery action

Assignment of costs not yet taxed (assessed)

Legal Aid NSW can request assignment of an untaxed costs order but cannot take further recovery action until the costs order had been assessed, notified to the grantee and filed.

Who can write a Notice to assignment?

Legal Aid NSW officers authorised under clause 22.9 the Delegation Instrument can request a legal assisted person to assign their right to recover costs.

“(1) When legal services have been provided to a legally assisted person, the Commission is to determine the amount, if any, payable to the Commission by the person in respect of the costs and expenses of those legal services (including expenses under section 33). More than one such determination can be made in respect of the person and can be made at or after the conclusion of the matter for which legal services were provided or, if legal aid is terminated during the course of the matter, at or after the termination. A determination can be varied by a later determination.

(2) The amount payable under subsection (1) shall not exceed the amount by which the sum of:

(a) the costs of the legal services provided, and

(b) any disbursements and out-of-pocket expenses incurred in or in connection with the provision of those services, exceeds any amount, or the sum of any amounts, paid by the legally assisted person to the Commission under section 36 (1) (a).

(2A) An amount required to be paid under subsection (1) must be paid in such manner, and within such time, as the Commission directs.

(3) The Commission may recover an amount payable to it under subsection (1), and any interest payable in respect of the amount, as a debt in a court of competent jurisdiction.

(4) For the purposes of subsection (2), a reference to costs is a reference to costs assessed as if the legally assisted person were not a legally assisted person.

Commentary

Once proceedings are concluded, Legal Aid NSW must assess the amount, if any of its costs and expenses in providing legal aid to the client and make a section 46 determination on the amount if any that the client should contribute.

See Contributions policy and Contributions guidelines for information on contributions.

When is a s46 determination made?

The section 46 determination can be made at or after the conclusion of proceedings or at or after the termination of the grant of legal aid. More than one determination can be made. A section 46 determination can be varied by a later determination.

Section 46 contributions should be distinguished from contributions to costs awarded against a client assessed under section 36(1)(b) of the Act.

Legal Aid NSW officers authorised under clause 23.2 of the Delegation Instrument can make or vary a s46 contribution.

Limit to the amount of a s46 contribution

A s46 contribution cannot exceed the costs of legal services provided including disbursements and out of pocket expenses.

When is payment of contribution due?

The amount payable to Legal Aid NSW must be paid within the timeframe and the manner Legal Aid NSW directs.

Proceedings to recover amount owed

Any amount payable or owed to Legal Aid NSW can be recovered as a debt in a court of competent jurisdiction.

Recovering s33 expenses

Subsection 46(1) confirms that s 33 expenses may be included in a s46 recovery and provides that a determination may be varied.

See Contributions chapter for policies on s 46 contributions.

“(1) Where a court or tribunal makes an order as to costs against a legally assisted person

(a) except as provided by subsections (2), (3), (3A), (4) and (4A), the Commission shall pay the whole of those costs, and

(b) except as provided by subsections (3), (3A), (4) and (4A), the legally assisted person shall not be liable for the payment of the whole or any part of those costs

(2) The Commission shall not pay an amount in excess of $5,000 (or such other amount as the Commission may from time to time determine)

(a) except as provided by paragraph (b), in respect of any one proceeding or

(b) in respect of each party in any one proceeding, being a party who has, in the opinion of the Commission, a separate interest in the proceeding

(3) The Commission shall not be liable to pay any costs incurred by or on behalf of a person in respect of a period during which that person was not a legally assisted person (even though those costs were ordered to be paid at a time when that person was a legally assisted person) and that person shall be liable for the payment of those costs

(3A) Where a court or tribunal makes an order as to costs against a legally assisted person in respect of proceedings for a criminal offence in which the legally assisted person was the accused person, the legally assisted person shall be liable for the payment of the whole of those costs

(4) Where a court or tribunal makes an order as to costs against a legally assisted person in respect of

(a) an appeal, or an application for a new trial, made on the ground that money awarded to the legally assisted person is inadequate,

(b) an action in which the legally assisted person is successful against one or more, but not all, of the other parties to the action,

(b1) an action in which the legally assisted person is successful after having been unsuccessful in interlocutory proceedings related to the action,

(c) an action heard and determined pursuant to an order under section 42 of the Civil Procedure Act 2005,

(d) an action brought under the Family Law Act 1975 of the Commonwealth or

(e) an action brought under the Child Support (Assessment) Act 1989 of the Commonwealth, the Commission may decline to pay the whole, or such part as it determines, of those costs and those costs or that part which the Commission has declined to pay shall be paid by the legally assisted person

(4A) If a court or tribunal makes an order as to costs against a legally assisted person on the basis that the person did not accept an offer of compromise made in proceedings (being an offer made in accordance with rules of court or an offer of a prescribed kind):

(a) the Commission may decline to pay the whole, or such part as it determines, of those costs to the extent that they are costs incurred by the party that made the offer after the day on which the offer was made, and

(b) the legally assisted person is liable for payment of any of those costs that the Commission has declined to pay.

(5) The Commission shall give notice, in writing, to a legally assisted person, the whole or part of whose costs it has, under subsection (4) or (4A), declined to pay, of the decision to decline payment of the costs within 14 days after the decision is made.

(6) Where a decision to decline to pay the whole or part of any costs is made by a person or committee acting in pursuance of a delegation or authorisation under section 69, the person or committee shall, in a notice given under subsection (5), inform the legally assisted person that he or she has a right of appeal to a The Commission Review Committee against the decision.

(7) Where a person or committee referred to in subsection (6) declines the payment of costs under subsection (4) or (4A), the person or committee shall record the reasons for the decision to decline the payment.

(8) Any amount paid by the Commission under this section shall be deemed to have been paid by the legally assisted person on whose behalf it is paid”.

Commentary

Section 47 provides that with some exceptions Legal Aid NSW is liable for the costs awarded against a legally aided person, but limits the amount of costs Legal Aid NSW is liable to pay to a maximum amount to be determined by Legal Aid NSW.

Current maximum amount paid by Legal Aid NSW

The current maximum amount is $15,000. The ceiling referred to in s47(2) may be raised without amending the Act. Legal Aid NSW does not raise the ceiling for particular matters. It will only raise the ceiling as a matter of policy to apply to all matters which come within the scope of s47.

Statutory protection against costs

Section 47 gives a statutory protection to the legally assisted person against paying costs awarded against them except in certain specified matters and in Federal Court proceedings.

Notification to other parties

The legal practitioner acting for the legally assisted person must notify the other parties to the proceedings of the effect of s 47 of the Act. See s 34(6) of the Act for notification procedures and requirements.

What if there is more than one party?

If there is more than one successful other party to the proceedings the monetary limit will be shared between the parties except where Legal Aid NSW is satisfied that the party has a separate interest, then a separate monetary limit will apply to that party.

See Costs and Fees chapter for policy on s 47 costs.

Where Legal Aid NSW can exercise discretion in matters where indemnity does not apply

Legal Aid NSW may exercise discretion to decline to pay the whole or part of the costs in the matters set out in subsections (4) and (4A).

Costs incurred under contractual obligations (Mortgages) or as a statutory obligation

Legal Aid NSW is not liable for cost which are incurred by the legally assisted person under contractual or statutory obligations(eg mortgages). Maher v Network Finance Ltd(1986) 4 NSWLR 694.

Accordingly Legal Aid NSW is not liable to pay:

costs incurred under
- a contractual obligation - (example - recovering costs under a covenant to a mortgage), or
- a statutory obligation (example - Supreme Court Rules Pt52 r65).

Costs that Legal Aid NSW will not pay under s47 of the Act

Costs incurred by or on behalf of a person for the period when that person was not a legally assisted person. This includes party/party costs which relate to work undertaken prior to the grant of legal aid.

Where a court or tribunal makes an order as to costs against a legally assisted person in relation to proceedings for a criminal offence in which the legally assisted person was the accused person.

Terminating a grant of aid and the effect of s47

Legal Aid NSW officers need to be aware of the effect that terminating legal aid may have in rendering a formerly legally assisted person liable for the whole of the other party/ies costs of the proceedings. This includes party/party costs incurred for the period when legal aid was current. Where possible the legally assisted person should be given the opportunity to conclude proceedings without incurring adverse cost orders. For requirements on terminating grants see s 38 of the Act.

Does the indemnity cover the Federal Court?

The indemnity under s47 of the Act does not cover Federal Court matters. Legal Aid NSW, however, may pay an amount towards costs awarded against a legally assisted person in a Federal Court matter up to the monetary limit set by section 47(2). The legally assisted person will be liable to pay any balance owing. Grant letters for Federal Court matters need to clearly notify the applicant of this.

In Woodlands & ors v Permanent Trustee Co (1996) 139 ALR 127 the full Federal Court held that:

“section 43 of the Federal Court Act overrode section 47 of the LAC Act”.

Librizzi v Flower Power P/L [2000] FCA 1500 is to similar effect.

The High Court in Bass v Permanent Trustee Co & Or [1999]overruled the full Federal Court in Woodland on the basis that no cost order had been made but gave obiter to the effect that s43 of the Federal Court of Australia Act 1976 (Cth) would prevail over s47 of the Legal Aid Commission Act (NSW).

In an interim decision in the Woodlands case (1995) 58 FCR 139, Wilcox J granted an application for fixing of maximum costs recoverable in the proceedings on a party and party basis, a process provided for by O62A of the Federal Court rules. The fact that the plaintiffs were legally aided was a factor in capping costs at $12,500, the then maximum section 47 amount.

In Minns v New South Wales (No 2) [2002] FMCA 197 the Federal Magistrates Court considered some factors which may be considered in deciding whether to cap party and party costs in a legally aided matter.

In Corcoran v Virgin Blue Airlines Pty Ltd [2008] FCA 864 the Federal Court more fully discussed the factors relevant to the exercise of discretion to make an order capping party and party costs.

Interlocutory proceedings and s47 indemnity

Under s 47(4)(b1) Legal Aid NSW may decline to pay the whole or part of costs awarded against a legally assisted party in interlocutory proceedings if the legally assisted party succeeds in the final proceedings. Accordingly, where possible, payment of costs in interlocutory proceedings should await the outcome of the final proceedings.

Case law and s47 of the Act

Section 47 of the Act does not prevent a court from making orders for security for costs against a legally assisted party, though it may influence whether such an order should be made Rajski & ors v Computer Manufacturing and Design P/L [1983] 2 NSWLR 122.

In Khoury & Anor v Hiar & Anor [2006] NSWCA 47 Legal Aid NSW succeeded in stopping Mr Hiar from enforcing the costs judgment against Ms Khoury. The Court of Appeal confirmed that a legally assisted person is not liable for an adverse cost order and Legal Aid NSWs liability for costs is limited by the operation of section 47 of the Act.

In Everingham v GIO CA 40718/94 13 April 1995, the claimant lost one legally aided claim against the opponent and won a claim that was not legally aided. The opponent then sought to set off the amount of the claimants cost award in the case he had won against the costs the opponent claimed in the legally aided case. The Court of Appeal overruled an order in the District Court setting off the amount of opponents costs on the grounds that they were covered by the section 47(1) exemption.

Re: Seghabi ex parte: GIO General Limited No. NP298 of 1994 FED No. 470/94, a Bankruptcy Petition was dismissed in part because the costs order on which it was based included costs for the period when the debtors were legally assisted and which they were not liable to pay under section 47(1). The creditor had not received notice of the grant of legal aid.

Who can authorise payment under s47(4) and (4A)?

Legal Aid NSW officers authorised under clause 25 of the Delegation Instrument can authorise payment under s47(4) and (4A).

Advising Clients in federal court and tribunal matters

Grant letters in proceedings in the federal courts and tribunals should include paragraphs which set out the risks where costs are awarded against the legally aided person.

Procedure for paying s47 costs

Before agreeing to pay the costs of the successful party under s47, Legal Aid NSW officers must examine the legal practitioner's account of costs, disbursements and counsel's fees.

“(1) To secure the payment of costs in respect of work done by the Chief Executive Officer or a member of staff of the Commission, and expenses incurred by the Commission, on behalf of a legally assisted person, the Commission has a lien on any document held by it in connection with proceedings conducted on behalf of the person by the Chief Executive Officer or member of staff.

(2) The law relating to the waiver of a solicitor's lien applies to the Commission's lien in the same manner as it would apply if the person in respect of whom the Commission's lien is exercised were not a legally assisted person”.

Commentary

Section 48(1) creates a statutory lien that applies only to documents.

Subsection (2) was introduced when a new section 48 was substituted by the Legal Aid Commission (Amendment) Act 1996, to take into account the Supreme Court's power to set aside liens under section 209C of the legal Profession Act 1987 (now section 728(1) of the Legal Profession Act 2004). It was also intended to ensure that Legal Aid NSW can obtain files from private practitioners that are subject to a lien, in return for undertaking to pay costs. The reference to the law relating to waiver should be treated as including Rules 29.4 and 29.5 of the Solicitors Professional Conduct and Practice Rules 1995.

Legal Aid NSW officers authorised under clause 34 of the Delegation Instrument can exercise a lien.

The Commission is to determine the procedure for engaging law practices for the provision of legal aid, which may relate to, without limitation—

(a) the eligibility criteria of law practices, or

(b) the matters for which a law practice may be engaged, which may include (but are not limited to)—

(i) matters generally, or matters of a particular type or class, or

(ii) matters in a specified jurisdiction, or

(iii) matters in a specified area of the State, or

(c) the manner in which work is to be distributed to law practices, having regard to the interests of the legally assisted person or any choice expressed by the legally assisted person for a particular law practice.

(2) A law practice that provides community legal services is not eligible to be engaged by the Commission for the provision of legal aid, unless the Commission otherwise determines.

(3) A law practice that has been engaged by the Commission for the provision of legal aid does not have an entitlement to be given work.

(1) The Commission may, in respect of any work assigned by the Commission to a law practice, carry out an audit of the law practice, or cause an audit to be carried out, in accordance with arrangements made between the Commission and the law practice when the law practice was engaged by the Commission for the provision of legal aid.

(2) For the purposes of an audit under subsection (1), the Commission, or a person appointed by the Commission, may—

(a) require a law practice to produce for inspection any files, records or documents relating to an assigned matter, and

(b) make copies of, or take extracts or notes from, any such files, records or documents, and

(c) require a law practice to provide the Commission, or person, with such assistance and facilities as may be reasonably necessary to enable the Commission, or person, to exercise the functions under this section, and

(d) require a law practice to give the Commission, or person, such other information as is reasonably necessary for the purposes of the audit.

(3) The relationship between a law practice and a legally assisted person does not operate to prevent or limit an audit conducted under this section.

(4) Except in proceedings under Chapter 5 of the Legal Profession Uniform Law (NSW), the production of a file, record, document or statement, or the giving of information, under this section does not subsequently affect any legal professional privilege to which, but for subsection (3), the file, record, document, statement or information would be subject.

(5) The regulations may make provision for or with respect to audits under this section.

(6) Nothing in section 12(i) or 25 prevents or restricts the carrying out of an audit under this section.

Repealed

repealed

“The Commission may establish one or more Legal Aid Review Committees:.

“(1) A Legal Aid Review Committee is to consist of 3 members appointed by the Board, of whom:

(a) one is to be a person nominated by the Minister, and

(b) one is to be a person nominated jointly by the Bar Association and the Law Society, and

(c) one is to be a person who is not a legal practitioner.

(2) One of the members is, in and by the relevant instrument of appointment or in and by a subsequent instrument, to be appointed as Chairperson of the Committee”.

Legal Aid NSW has established six Legal Aid Review Committees (LARC), including three specialist Family Law LARC.

See Appeal chapter for policies and guidelines on appealing to LARC.

See Appeal Guideline 6.8 for list of current members of LARC.

“(1) An applicant or legally assisted person dissatisfied with:

(a) the determination or redetermination, by a person or committee acting in pursuance of a delegation or authorisation under section 69, of an application under section 34 (1),

(b) the variation, by such a person or committee, of a grant of legal aid under section 38 (1),

(b1) the redetermination of a variation of a grant of legal aid, by such a person or committee, under section 38 (1AA), or

(c) a decision, by such a person or committee, to decline payment of the whole or any part of costs under section 47 (4) or (4A), may appeal to a Legal Aid Review Committee.

(1A) Such an appeal may not be made in respect of the determination or redetermination of an application under section 34 (1):

(a) if the application has been refused as referred to in section 34 (3) (b), or

(b) if the application relates to proceedings in a Local Court with respect to a criminal offence and the applicant is dissatisfied because he or she is required to pay a contribution towards the costs and expenses of the legal services sought by the applicant.

(1AA) Despite subsection (1), an appeal may not be made in respect of the imposition of a condition on a grant of legal aid (whether imposed by way of a determination or redetermination of an application for legal aid, or by way of a variation or redetermination of a variation of a grant of legal aid) if the condition is to the effect that the Commission is to provide the legal aid concerned by any of the following means:

(a) by making available the services of the Chief Executive Officer or members of the staff of the Commission, or

(b) by arranging for the services of the Public Defenders to be made available,

(c) by arranging for the services of private legal practitioners to be made available, wholly or partly at the expense of the Commission.

(1B) An appeal against the refusal of an application for legal aid lapses if, after the appeal is lodged, the Commission grants the application on a redetermination of the matter under section 34.

(1C) An appeal against the variation of a grant of legal aid that terminates the provision of legal aid lapses if, after the appeal is lodged, the Commission provides legal aid on a redetermination of the matter under section 38.

(2) An appeal shall be lodged with the Commission in writing in accordance, or substantially in accordance, with the form approved by the Commission for the purpose and shall be so lodged within:

(a) a period of 28 days after the date on which notice of the determination or redetermination of the application, variation or redetermination of the variation, or decision in respect of which the appeal is brought was given to the appellant, or

(b) such longer period as a Legal Aid Review Committee may, where it is of the opinion that there are special circumstances, allow”.

Commentary

Section 56 deals with appeals to Legal Aid Review Committees (LARC). Section 56(1) of the Act sets out the circumstances in which an applicant for legal aid can appeal a decision by Legal Aid NSW.

An applicant or legally assisted person may appeal to a Legal Aid Review Committee when dissatisfied with

a variation of a grant under s38(1) of the Act
a redetermination of a variation of a grant that terminates the provision of legal aid made under s38(1AA) of the Act
a decision to decline to pay the whole or part of costs under s47(4) or s47(4A) of the Act
the determination or redetermination of a legal aid application under s34(1)of the Act except as set out in the exceptions under 56(1A) and (1AA) of the Act

See Appeal chapter for policies in relation to appeals to LARC

When an applicant cannot appeal a determination

A legal aid applicant or legally assisted person cannot appeal certain determinations which are set out in subsections 561A and 1AA of the Act.

When does an appeal lapse?

An appeal lapses if after the appeal is lodged legal aid is granted under a redetermination under s34 of the Act.

Case law and appeals

In Bustard v Caldwell SC 14321 of 1987 October 1987 the Supreme Court held that there cannot be an appeal under s 56 and adjournment under section 57 until there has been a prior determination of an application for legal aid under s34 of the Act.

See Appeal chapter for policies on appeals to LARC.

“(1) Where it appears to a court or tribunal, on any information before it

(a) that a party to any proceedings before the court or tribunal:

(i) has appealed, in accordance with section 56, to a Legal Aid Review Committee and that the appeal has not been determined, or

(ii) intends to appeal, in accordance with section 56, to a Legal Aid Review Committee and that such an appeal is competent,

(b) that the appeal or intention to appeal is bona fide and not frivolous or vexatious or otherwise intended to improperly hinder or improperly delay the conduct of the proceedings, and

(c) that there are no special circumstances that prevent it from doing so,

the court or tribunal shall adjourn the proceedings to such date on such terms and conditions as it thinks fit”

Right to an adjournment

Section 57 of the Act imposes an obligation on a court or tribunal to adjourn proceedings to such date on such terms and conditions as it thinks fit where it appears to the court or tribunal:

that a party to any proceedings before the court or tribunal
has appealed under s56, to a Legal Aid Review Committee
or intends to appeal and the appeal is competent

and

that the appeal or intention to appeal is bona fide, and not frivolous or vexatious or otherwise intended to improperly hinder or improperly delay the conduct of the proceedings, and
there are no special circumstances that prevent it from doing so.

The language of s57 is mandatory: The Friends of the Glenreagh Dorrigo Line Incorporated & Ors v Jones & Ors [1994] NSWCA 101 per the Full Supreme Court. Prima facie the existence of an appeal or an intention to appeal requires an adjournment: Lewis v Spencer [2007] NSWSC 1383 at [11]. Once a court is satisfied that each of the requirements of the section is fulfilled, the court must adjourn proceedings: DPP v Emanuel [2009] NSWCA 42 at [35]-[36] per Full Court of Appeal. The court does not possess any residual discretion to decide whether or not to grant the adjournment: Waverly Council v Bobolas [2005] NSWLEC 577 at [14].

s57(1)(b): The appeal or intention to appeal is bona fide and not frivolous or vexatious or otherwise intended to improperly hinder or improperly delay the conduct of the proceedings

The bona fides of the appeal is determined by an analysis of whether the appeal is being pursued for genuine purposes. In other words, the section requires the court to determine whether the appeal is being lodged (or is intended to be lodged) for the purpose of causing the adjournment; not for purpose of obtaining legal aid: Lewis v Spencer [2007] NSWSC 1383 at [15].

Whether the appeal to the Legal Aid Review Committee was or will be successful does not determine the issue of whether the appeal is bona fides: Lewis v Spencer [2007] NSWSC 1383 at [15]. (Note, however, that the competency of the appeal is relevant to the requirements of s57(1)(a)(ii)).

Nor is the fact that witnesses will have to re-attend and the proceedings will have to be re-organised sufficient reason to find that there is an improper hindrance or delay in the proceeding or that the appeal or intention to appeal is not bona fide: Lewis v Spencer [2007] NSWSC 1383 at [18].

Even an unreasonable act by the appellant that caused the initial refusal or termination of legal aid may not, without more, be conclusive or relevant to the bona fides of an appeal: Lewis v Spencer [2007] NSWSC 1383 at [19].

For an example of a case in which an adjournment was refused because it was held the conditions set out in s57(b) were not met, see Duchesne v Master Education Services Pty Ltd [2008] NSWIRComm 233.

s57(1)(c): Special circumstances

The question of whether there are special circumstances involves the exercise of the Court's discretion: Bourke and Bourke v Beneficial Finance Corporation Limited (1993) 124 ALR 716 at [72] per the Full Federal Court.

In The Friends of the Glenreagh Dorrigo Line Incorporated & Ors v Jones & Ors [1994] NSWCA 101 the Full Supreme Court upheld an appeal against the dismissal of proceedings where a LARC appeal was under way because the judge, when determining that no adjournment should be given, did not identify the special circumstances which prevented such an adjournment having effect.

The application of s57 to Federal courts and tribunals

Section 57 applies to both state and federal courts and tribunals: Wilson v Alexander [2003] FCAFC 272 at [23] per the Full Federal Court.

This principle stated in Wilson was applied in Tsoi v Savransky [2004] FMCA 879 at [13] and Maslaukas v Qld Nursing Council (No.2) [2008] FMCA 236 at [7], where Barnes FM stated: “While there was previously some debate as to whether such a New South Wales legislative provision applied in the Federal Courts and proceedings under Federal law […] it is now clear that the [Federal] Court is bound by that legislation to adjourn the proceedings if the requirements of s57 are met save in special circumstances.”

Onus

The onus rests with the party opposing the adjournment to establish one or more of the relevant circumstances that would justify refusal: Fibre-Tek (Gold Coast) Pty Ltd v Sky Bennett [2006] NSWSC 1100 at [26]; Lewis v Spencer [2007] NSWSC 1383 at [17].

Seeking a court adjournment pending a LARC appeal

Legal practitioners assisting with an application and informing them of their right to appeal under s56 should also advise them on the procedure for applying for a court adjournment in the event that they lodge an appeal against any determination of the grant of aid.

“For the purposes of hearing and determining an appeal, a Legal Aid Review Committee

(a) has the functions and discretions that the person or body whose determination, variation or decision is the subject of the appeal had in respect of the matter the subject of the appeal, and

(b) is required to comply with any policy guidelines with which that person or body was required to comply in respect of the matter the subject of the appeal”.

Commentary

Section 58(a) requires LARC to exercise discretions of the officer making the original determination, including taking into account the responsibilities under s12 of the Act.

The policy for appeals and the guideline for procedures for preparing appeals to LARC are set out in the Appeal chapter and are based on the matters which LARC must consider under s 58 of the Act.

The determining officer preparing a report for LARC should include as supporting material extracts of all policies and all information that were relevant to determining the application.

See Appeal Guideline 6.2 for procedure on preparing reports for LARC.

Date of grant of aid following an appeal

Legal aid grants approved by LARC generally date from the date of the original request for an emergency grant or the date of receipt of the original legal aid application rather than the date on which the appeal is determined. See types of grants of aid for policies on dating grants.

“(1) A Legal Aid Review Committee shall determine an appeal made to it and in so doing may make such order with respect to the matter the subject of the appeal as it thinks fit.

(2) A Legal Aid Review Committee shall give notice, in writing, of its determination of an appeal to the appellant and to the Commission.

(3) A Legal Aid Review Committee shall record its reasons for the determination of an appeal”.

“(1) A determination or order of a Legal Aid Review Committee under section 59 in respect of an appeal shall be deemed to be the final decision of the person or body whose determination, variation or decision was the subject of the appeal and shall be given effect to accordingly.

(2) Nothing in subsection (1) prevents the assignment of work to a private legal practitioner in respect of an applicant whose appeal to a Legal Aid Review Committee has been upheld”.

Commentary

There is no right of appeal from a final decision of a LARC. Once a LARC has made a decision neither LARC nor Legal Aid NSW will review its merits.

However, in cases where new information is received after a LARC has decided an appeal there may be a further determination of an application under section 34 of the Act.

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Part 3 - Provision of legal aid

Section 29 - Definitions

Section 30 - Provision of legal aid

Provision of legal aid

Lump sum grants

Conditions of a lump sum grant of aid

Departing from means and merit test in grants of legal aid

Section 31 - Application for legal aid

Section 32 - False application

Section 33 - Powers of Commission in respect of application

Expenses incurred by Legal Aid NSW under s33

Obtaining Counsel's advice

Section 33 authorisation is not a grant of legal aid

Who can authorise a s33 payment

Section 34 - Determination of application

Who can make a determination to grant legal aid?

Redetermining grants of aid

Notifying applicant in writing

Applicant's right of appeal

Exceptions to right of appeal

An applicant has no right of appeal against a determination:

Record reason for decision

Mandatory notifications under s34

Private legal practitioner must notify other parties if client legally assisted

Notice of receipt of legal aid application

Appeals to LARC

Section 34A - Date on which legal aid is granted

No retrospective grants

Section 34B - Commission can require security for costs etc

Security of costs

Recovery of debts

Section 34C - Certain arrangements do not amount to imposition of condition, or variation, of legal aid

Lump sum fixed amount

Section 35 - Means test

Means Test

Section 36 - Monetary contribution by applicant

Contribution towards an adverse cost order

Exempt matters

Notifying Clients

Collecting s36 contribution

Waiving or varying a contribution

Section 37 - Applications by certain persons

Section 38 - Variation of grant of legal aid

Investigative powers

Notification of varying a grant of legal aid

Recording reasons

Terminating a grant of legal aid

Procedural fairness in terminating a grant of aid

Consideration given to impact of terminating grant

Section 38A - Notification of changes

Failure to notify of any changes which may affect the grant of legal aid.

Section 39 - Fees in respect of assigned matters

Fees in criminal matters

Section 40 - Assessment of costs

Rights of client to have Bill of Costs assessed and s46 contributions

Legal practitioner's Bill of Costs must be acceptable to client

Section 41 - Demand for or receipt of certain payments prohibited

Breaches of s41

Reporting breaches

Section 42 - Discretion of court or tribunal as to costs

Section 43 - Payment of costs in cases of fraud and improper behaviour

Who can apply to a court or tribunal?

Section 43A - Payment of costs to private legal practitioners

Commentary

Deferring payment of fees

What fees does it to?

Refusing to pay legal practitioner's fees

Who can defer or refuse to pay fees?

Section 43B - Payment of money by certain private legal practitioners

Section 44 - Direction as to payment of certain money to the Commission