Adjudication Commencement

Table of Contents

New Adjudication System

New rules were published in 2019 to provide for the transition from the former taxation of costs system to the legal costs adjudication system provided for under the Legal Services Regulation Act. Matters pending for taxation at the date the rules commenced may be referred to legal adjudication. As well as changing the system for ascertaining costs the rules contain some important new principles in relation to costs.

The Legal Costs Adjudicator may adjudicate on a range of costs matters including those arising out of

court decisions,
arbitration tribunal’s
receivers costs in any proceedings on the application of the receiver
of registering judgement as mortgages
of obtaining grant of probate and letters of administration
of satisfying judgement in the application unilateral application of the party concerned

The costs between legal practitioner (solicitor) and client may be adjudicated on the application of the client. The client shall give a written undertaking to pay any balance which may be payable on the determination and certification of the Legal Costs Adjudicator.

The costs of adjudication are awarded in accordance with the relevant event. This reflects the general rule in principle that the successful party is entitled to costs.

Adjudicator’s Organisation

The Chief Legal Costs Adjudicator may specify the form of documents required for the purposes of this Part as he or she considers appropriate. A form specified, or specified in rules of court, shall be completed in accordance with such directions and instructions as are specified in the form, accompanied by such documents as are specified in the form, and if the completed form is required to be provided to—

the Chief Legal Costs Adjudicator,
another person on behalf of the Chief Legal Costs Adjudicator, or
any other person, so provided in the manner, if any, specified in the form.

Bills of costs lodged are dealt with in accordance with the lists. The bill of costs is lodged with the Legal Costs Adjudicator’s office. It must be accompanied by a memorandum by the legal practitioner stating whether there has been any previous adjudication taxation of costs in the same matter. It may be lodged in electronic form.

Notice of Application

A notice of application for adjudication shall give 14 days notice of the original return date ( i.e. the date on which it is first considered.) In an urgent case shorter notice may be given with the consent of the adjudicator.

It is not necessary to serve the opposing party with a copy of any document or item which accompanied the notice filed in the Office of the Legal Costs Adjudicators which has been previously served on or sent to the opposing party or which has been provided to the party effecting service by the opposing party.

A bill of costs lodged for adjudication shall have the name and registered place of business of any legal practitioner by or for whom it is so lodged. Where value added tax is claimed in a bill of costs the tax number of a person registered for VAT must appear in a prominent place on every bill of costs, account or voucher, as appropriate, on which value added tax is claimed or chargeable.

Application Issues

The notice of application may be restricted so as to seek the adjudication of only one or more matters or items in the bill of costs. Any such notice shall specify precisely the matters or items on which adjudication is sought on the matters that have been agreed. The Legal Costs Adjudicator shall review the relevant part of the bill only in this case.

The application for adjudication is in a prescribed form depending on whether it is party and party or legal practitioner or client. The application is to be accompanied by

a bill of costs in the prescribed form
vouchers, invoices and/or receipts in respect of any disbursement which has not been agreed;
any other records on which the applicant relies in support of the costs claimed, separately indexed and paginated; and

Time Records

Where the applicant relies on time records in support of the costs claimed, the occasion is to be accompanied by those time records, separately indexed and paginated; showing –

each legal practitioner or other person concerned;
the hourly rate(s) applicable;
the date(s) on which the relevant work was undertaken and the actual hours, or portions of hours, expended thereon;
a total of the hours, or portions of hours, expended thereon, and
where any such time is estimated, a statement that such time has been estimated;
in the case of a party and party application ordered by a court it is to be accompanied by

Documents with Application

Where the adjudication has been the subject of a court order the application is to be accompanied by

a true copy of the order of the Court, award of the arbitrator or other order or instrument by which the costs have been awarded or allowed, and
in the case of a party and party adjudication applied for by the person the subject of the order to pay the costs, a certificate that the person has complied with the obligation to attempt to agree costs in advance of reference.

In the case of a Legal practitioner and client application it is to be accompanied the above documents together with by

a true copy of each legal costs notice notice provided by the legal practitioner concerned to the client in accordance with his obligations under the legal services regulation act or a specific agreement on costs
a copy of the required notice given by the client within 21 days of the bill of costs been provided disputing the cost and setting out the nature of the dispute
a true copy of any opinion of the legal practitioner in relation to having made reasonable attempts to resolve the dispute and having failed to do so
a true copy of any demand for payment.

Lodgment & Service

In the case of an application for legal practitioner and client adjudication, the applicant shall serve copies of the issued notice of application including the return date and the documents lodged therewith on the client or, as the case may be, the legal practitioner concerned.

In the case of an application for party and party adjudication, the applicant shall serve copies of the issued notice of application including the return date and the documents lodged on the legal practitioner or, as the case may be, the person who is the subject of the order to pay the costs.

Where the bill of costs or notices have to be served, details of the service is to be endorsed on them, specifying the person served, the time, place and mode of service, and the person serving, and the documents so indorsed shall be produced on

No addition or alteration shall be made in a bill of costs after it is lodged except by permission or direction of the Legal Costs Adjudicator.

Fixed Agreed Costs

Where an agreement has been made between the legal practitioner and client regarding the amount of payment and the manner of payment it is to be annexed to the bill of costs.

Where it covers all the legal costs that are to be paid an invoice prepared by the legal practitioner containing a summary of the costs and outlays pursuant to the agreement together with a copy of the agreement constitutes the bill of costs. Where the agreement concerns part of the legal costs that are payable it shall apply to that part.

Application by Client

A client of a legal practitioner may apply for the adjudication of costs by issuing a notice of application and serving such notice on the legal practitioner. In the case of an application for legal practitioner and client adjudication by the person liable for the costs, the applicant is not required to have the bill of costs in the form prescribed by these Rules.

He or she may lodge the bill of costs, memorandum of costs or account for costs, in whatever form it was received from the legal practitioner, and in default of such the applicant may set down a written statement of the relevant facts in lieu thereof.

A Legal Costs Adjudicator may, if he considers it just and convenient, direct the legal practitioner, at no cost or expense to the client, to revise a bill of costs to the client to ensure that the bill of costs is prepared in accordance with the 2015 Act.

Acceptance with Omissions

Where a Legal Costs Adjudicator so directs, a bill of costs may be accepted for adjudication notwithstanding that it does not comply with the prescribed form, provided that the Legal Costs Adjudicator is satisfied that the bill of costs:

is in the Legal Costs Adjudicator’s opinion sufficient, when read together with the documents served and filed together with that bill, to enable the paying party to assess and dispute or oppose the work undertaken and disbursements incurred in respect of which charges are claimed, and
is in the Legal Costs Adjudicator’s opinion sufficient, when read together with the documents served and filed together with that bill, to enable the Legal Costs Adjudicator to adjudicate the matters and items in dispute in accordance with the 2015 Act.
has the basic information required under the LSRA act for a bill furnished by a legal practitioner to a client,
a summary of legal services provided to the client in connection with the matter concerned;
an itemised statement of the amounts in respect of the legal costs in connection with the legal services;
the registration number of the legal practitioner for the purposes of value-added tax, and the amount of value-added tax chargeable
where time is a factor in the calculation of the legal costs concerned, the time spent in dealing with the matter;
the amount, where known to the legal practitioner, of any damages or other moneys that are recovered by, or payable to, the client and that arose from the matter in respect of which the legal services were provided;
the amount of any legal costs recovered by or payable to the legal practitioner concerned on behalf of the client, including costs recovered from another party, or an insurer on behalf of another party, to the matter concerned.

Where a bill of costs which does not conform to the prescribed form and is not sufficient to satisfy the requirements the Legal Costs Adjudicator may:

adjourn the adjudication and direct the service and lodgment of a new bill of costs, or of an amended bill of costs;
adjourn the adjudication and direct the service and lodgment of further information or documents in respect of matters or items in the bill of costs;
strike out the application for adjudication without prejudice to the right of the moving party to make a further application.