The cost of separation and divorce
Our research indicates that people considering separation / divorce think it will cost them $20K to $50K in legal costs. However, this range will only occur in a small number of cases due to complexity, etc. In our experience your legal costs will be significantly less than this and, because we have Family Law Fixed Fees TM, you have the certainty of knowing what it is going to cost you right from the beginning.
Introduction to Family Law Fixed Fees ™ with Ian Shann, National Practice Group Leader - Family Law
The following video is part of the Family Law Fixed Fee ™ video series, featuring accredited family law specialist and the national leader of family law at Slater & Gordon - Ian Shann. This video provides information about Slater & Gordon's service of fixed fees in family law.
Click below to understand more about our Family Law Fixed Fees ™.
What are fixed fees
Fixed fees are pretty simple. You and your lawyer discuss your matter, the work required and the amount to be paid for that work. You then discuss how you will pay for the agreed costs. If you all agree, you sign a contract and the lawyer gets working.
Nothing is done and no charges are incurred until the agreement is in place. Everyone knows exactly where they stand - and they know that from day one, not months later when the bills start arriving.
In most cases fixed fees provide a practical alternative to hourly billing, especially where you want to get matters settled quickly and at a cost that is both certain and proportionate to the work involved.
However, fixed legal fees may not be suitable in every situation. For instance, it is unlikely that fixed fees would be quoted if you have a complicated case with complex and uncertain legal issues or if you and your ex-partner are involved in a dispute with high levels of conflict.
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How fixed fees work
To arrive at a fixed fee agreement, the lawyer and the client have to carefully determine the facts, the legal issues involved and develop a plan how the matter is to be handled.
The lawyer then proposes a fixed legal fee that sets out the work that is to be included (and what might be excluded) and the fee which is to be paid.
The fixed fee proposal may involve all Stages of a matter or cover only part of the matters that might be involved. Sometimes it is not possible to quote a fixed fee for a later Stage until the earlier Stages have been completed (for instance, it is not possible to quote a price for preparing a matter for trial before the issues that are to be argued at the trial are known).
If you do not agree with the fixed fee proposal, the matter goes no further. It’s rather like buying a car or a house – unless the buyer and the seller agree, there is no deal.
The fixed fees arrangements form part of the Legal Costs Agreement that is the contract between client and lawyer.
No work is undertaken by the lawyer until the fee arrangements have been agreed and signed off by both parties.
The client will normally be asked to guarantee financial arrangements for the payment of each Stage of the work before it is done but the actual payment to the firm may not take place until after the Stage is completed.
Further Stages will be quoted as and when it is practicable (and necessary) to do so. Most matters in Family Law settle early in the piece and it is, therefore, a waste of everyone’s time and effort to quote for work which may never be done.
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How legal fees are calculated without fixed fees
Most lawyers who work in Family Law charges according to the amount of time they spend on your matter.
The fee you will be charged is calculated by multiplying the lawyer’s hourly rate by the amount of time they spend on your matter. So, if a lawyer (with a rate of $300 per hour) spends 10 hours working on your matter, you will be charged $3,000. If the lawyer had an hourly rate of $400, your bill for the same hours of work would be $4,000.
Comparing Fixed Fees with hourly rates
It is very difficult to compare a fixed fee with charges based on hourly rates – with hourly rates you don’t know until the matter has finished what the fee will be. With Family Law Fixed Fees ™ you know exactly what you are getting yourself into before you start the engagement. How much time your lawyer spends really does not concern you.
A fixed quote of, say, $2,500 to undertake to complete an agreed Stage in the process may appear to be a lot more expensive than $350 an hour (or, even, $500 an hour) for the same work. The point is that with an hourly rate you only know the outcome when it’s all over.
Although lawyers charge by the time they spend on your matter, it is important to know what is included in ‘chargeable time’ and what is not. As a rule, it is safe to assume that a lawyer can charge for the time spent doing almost anything on your matter, so long as it is ‘necessary’ and ’reasonable’, including telephone calls, e-mails, meetings, preparing letters and documents etc.
With Family Law Fixed Fees ™ there are no hidden costs and you do not pay for each six minutes spent by your lawyer on your matter.
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The advantages of fixed fees
Some of the advantages of fixed fee include:
- you know up front exactly what your costs will be.
- you can make realistic arrangements about how and when to pay your legal bills.
- you will pay a fee that equals the value you and your lawyer place on the work to be done, not the time it may take.
- your lawyer has a real incentive to get the work done and achieve results – because that’s how they get paid.
- you and your lawyer have the same goals and time frame – getting the matter resolved as quickly as possible.
- you won’t get any nasty surprises in the mail at the end of each month telling you how many hours you have to pay for.
- you won’t be charged for every minute your lawyer spends on the phone or every document that they copy or e-mail. You are charged only the agreed fee for the Stage of work that is being done.
Your lawyer receives payment only when a Stage of the fixed fee process has been successfully completed.
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What work is included in the fixed fee quote
The precise scope of the work to be undertaken is set out in the Legal Costs Agreement. It will normally include all legal and administrative work that is necessary to complete the particular Stage for which the fee was quoted. For instance, if we are to finalise settlement of a matter, that will include the drafting and execution of Court Orders and filing the Orders in the relevant Court.
The work includes preparing documents, dealing with correspondence, communicating with the other party and the Courts. Telephone, e-mail and fax communications will not be charged as separate items. You will not be charged for any time that we spend on your matter, except for Hearings and Conferences (which are set out below).
We include all of our operating costs quotation - like photocopying, telephone charges, faxes and e-mails - within the fixed fee.
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What work is NOT included in the fixed fee quote
The costs that we incur on your behalf in the conduct of your matter (known as ‘disbursements’) are not included in the fixed fee, although we will try to give you an estimate of what disbursements are anticipated in your case.
Work required for the enforcement or implementation of Orders is not included unless specifically specified in the fixed fee quote.
In special circumstances, there may also be specific exclusions which we would discuss with you and would be included in the Legal Cost Agreement.
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What are disbursements and why are they not included in the fixed fee quotations?
‘Disbursements’ are any costs we incur on your behalf. In most cases it is impossible to know at the beginning exactly what disbursements will be required.
We only incur a disbursement if you agree. We will require that you place money to meet any disbursements into our Trust Account so that the fees can be paid when the service is delivered.
Disbursements include expenses such as:
- Fees charged for work done by other professionals (barristers, experts, valuers, psychologists);
- Direct costs incurred in managing a matter such as courier fees; and
- Court fees.
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Frequently Asked Questions
Below we set out some of the questions that are raised about Family Law Fixed Fees ™.
Is the implementation of Orders included in any Stage?
No. It is not possible to know what implementation might be required until Orders are actually made by the Court. We will provide a fixed quote for implementation of Orders after they have been made and, if you agree, we will then proceed to do the specified implementation.
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Why are barristers sometimes engaged in Family Law matters
Barristers specialise in court appearances and in providing expert opinions about complex legal issues. We may engage a barrister for these purposes when we consider it to be in your best interests and that the benefits justify the cost.
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Do I have to pay for telephone calls, e-mails and faxes as well as reading letters or court documents?
No. With Fixed Fees you are charged a single amount for each Stage of your matter which covers all of the work we will undertake on your behalf. Of course, barristers and experts are additional to the fixed fees, but you won’t receive a bill for photocopying or sending letters to the other lawyers under fixed fees.
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Will the lawyer provide estimates of costs for future work that might be required?
We will give estimates of future work that might be required if this is practicable and sensible. It is difficult to know how a matter will proceed at the start and most Family Law matters settle quite early – especially if the parties and their lawyers are taking a constructive approach – and the future Stages may never be reached. Therefore, estimates are unnecessary and, in some cases, quite misleading.
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How far into the future will you provide fixed fees?
It is often not possible to quote for all Stages of a Family Law matter; it is also often quite unnecessary.
Most Family Law matters get resolved quite quickly and, in these circumstances, it would be a waste of everyone’s time and effort to prepare quotes for Stages that will never be reached.
Often it is impossible to quote for future Stages in any event – for instance, we are unable to give you a quote for “Trial Preparation” when the matter has barely started as we simply do not know what issues are to be argued at the Trial and what matters we will need to deal with at that time.
Before we start work on any Stage – and when we are aware of what is involved - you will be provided with a quote.
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What happens if my matter resolves before the work has been done?
If your matter settles before the work is completed for the Stage that has been quoted you will not have to pay the full fees for that Stage. We will advise you what work has been done and you will receive a refund for that part of work that has not been done.
Sometimes the matter will settle by the making of Orders in Court and we will quote you for the preparation and finalisation of Orders.
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How do you quote for Court Hearings & Conferences?
We provide an estimate up front of the fee for all Court Hearings and Conferences. This includes any travelling that we may have to undertake unless there is a separate agreement that you would pay for our travel time and costs.
No one can tell you how long a Court Hearing or Conference will take – sometimes they are quite quick, sometimes they take all day or even longer. So we provide you with a mid range estimate in the fixed fees quote but will charge fees according to whether the Hearing or Conference is short (less than 2 hours), average (between 2 and 4 hours) or long (over 4 hours). These fees are set out in the fixed fees agreement.
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What if I receive an Order that the other party pay my costs (or if I have to pay theirs)?
If the Court orders that the other party pay your costs you will receive those moneys in accordance with the Court Order.
Similarly, if the Court orders that you should pay any of the other party’s costs, you will be required to pay that money in addition to any fixed fees quote that we have given you. If you do not pay such Orders we will be unable to continue to represent you.
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What are the payment arrangements for fixed fees?
In normal circumstances (unless special arrangements have been agreed), the following arrangements will apply:
- before work commences on any Stage, you deposit the agreed fixed fees for that Stage into our Trust Account;
- we undertake the agreed work for that Stage;
- when we have completed the work the money is paid from the Trust Account to us;
- you then deposit the fixed fees for the next Stage into our Trust Account and the arrangements continue as above.
Sometimes, and provided you are able to put up appropriate security, we will agree to work prior to moneys being deposited to our Trust Account. But these circumstances will be exceptional.
You may also request a payment plan for the payment of your fixed fees, whereby you deposit a proportion of the fixed fees into our Trust Account on a monthly basis. We will allow this where there is a valid direct debit authority in place but in the event that a payment is not made, we reserve the right to cease work until the account is brought up to date or to terminate the agreement.
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How do I pay the amounts required for the fixed fee?
You may pay the agreed fixed fee in cash, by cheque or by direct debit authority.
It is possible that you may obtain a loan from a legal litigation funder.
These companies provide you with the funds to meet your legal expenses (and, sometimes, also to help with your living expenses). Fees will be payable to establish the loan and interest will be charged. The lender will also require security over a property in which you have an interest (to ensure that there is a source of payment if you cannot repay the loan at the end of the matter).
Usually you repay all of the loan plus the costs when all of the proceedings have been finalised.
What other credit arrangements might be available for the payment of the fixed fees ?
Using or obtaining a new credit card, arranging a guarantee or a loan facility from your bank are other options for the payment of your legal fees.
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Important Guidelines for Clients
The fixed fees arrangements work best when both you as the client and we as your lawyers are on the same page as to how best to conduct our relationship. Remember, we are trying to contain your costs by giving you a fixed fee and we want to be in a position to work on your matter efficiently and effectively. We are looking for the best outcome for you in a way that is consistent with our obligations and in accordance with your instructions.
So we ask that you consider the following carefully and respect our joint efforts to get results without undue delay.
Our philosophy and obligations
At Slater & Gordon our basic philosophy is to obtain the best results for our clients at the most economical fee. We strive to secure our clients’ best interests.
We also have an overriding obligation to the Courts to behave ethically and responsibly. It is important - especially in the emotional environment of Family Law - that our clients understand our obligations to the Courts.
The basic principle for the conduct of all Family Law matters is:
“to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case” (Family Law Rules 1.04).
We all have an obligation to:
- ensure that any orders we ask the Court to make are reasonable.
- disclose all relevant information.
- make sure we are ready for court events and meet all with time limits.
- identify the real issues that are in dispute.
- put only relevant and necessary information to the court.
As lawyers we also have an obligation to ensure that:
- we are familiar with your case; and
- we are in a position to deal with any issue likely to arise.
As Family Lawyers we adhere to the principles contained in the Best Practice Guidelines for Family Lawyers (produced by the Family Law Section of the Law Council of Australia). These include:
- being constructive and conciliatory
- narrowing the issues in dispute and looking for solutions
- supporting parties to find sensible and reasonable resolution of their differences
- ensuring that costs are not unreasonably incurred
- being objective and focussing on issues
- avoiding hostile and unnecessary exchanges
- protecting the best interests of children and not involving them in their parents’ disputes.
Family Law is not a battleground for parties to act out their conflicts and personal disputes. It is to get matters resolved as quickly and economically as possible.
We believe in being firm but we work for realistic and attainable outcomes. The best results in Family Law are ‘fair and reasonable’ conclusions for all parties.
Communications - letters, phone calls and e-mails
We understand that Family Law matters can be stressful and you need to be kept informed of progress in your matter. Part of the Family Law Fixed Fees ™ arrangement is that we won’t charge you on a 6 minute basis for phone calls and communications with you. However, please be aware that unnecessary and constant telephone or e-mail communication is counterproductive for everyone.
We will not contact you unnecessarily and we ask that you do the same.
We undertake to communicate with you as is necessary for the sensible conduct of your matter and we will keep you informed of any issues that are relevant.
We will copy all relevant documents to you, including correspondence and Court documents.
We will seek your agreement before making any offers to the other party or sending mail dealing with issues in dispute.
If you have a genuinely urgent issue to deal with we encourage you to contact us and advise of your concerns.
Accurate and complete instructions are absolutely vital to enable us to conduct your matter effectively.
Please ensure that you have advised us of all matters that might be relevant to your matter. If you are in doubt, it is better to say more than less.
Please make sure that what you instruct is accurate and complete. If you only tell us part of the story or the bits that are favourable, we can not conduct your matter properly or in your best interests
Please answer all questions we ask truthfully and completely
Please ensure that you fully disclose all information that is relevant in your matter – a complete disclosure of all financial information in your knowledge or possession is a fundamental requirement of the Family Law.
Return of information and responding to requests
The efficient flow of information and documents between us is an important factor in the effective handling of your matter by us.
Please respond promptly when we send documents to you for your approval. Apart from deadlines which might be set by the Courts, it is important that we maintain progress in your matter and things will really slow down if we don’t keep them moving.
If we seek your instructions on any issue, please respond promptly. If you are unsure or have difficulties in getting a response for whatever reason, call and tell us.
If we leave messages for you to call us, please treat the request as important. We won’t call you unless there is something happening (or needing to happen) in your matter.
Payment of fees - promptly and in accordance with the Agreement
Any Family Law Fixed Fee ™ relationship is two sided – we undertake to expedite your matter and to work for the outcomes we have agreed with you. Part of your obligation is to ensure that the fees we have agreed are paid promptly and in accordance with our agreement.
We don’t want to be arguing with you over fees – that’s why we fix them and agree them up front – and that includes arguments about payment.
All fixed fees must be paid in advance and money deposited in our Trust Account before any work will be done. Please understand that this is an essential condition of us starting work.
We will not draw your money from the Trust Account until we have finished the Stage of work which was agreed with you.
At the conclusion of each Stage we will advise you that the agreed fixed fees for that Stage is to be drawn down by us. If you have any difficulties with this please ensure we are advised well in advance so that we can discuss and resolve problems at an early Stage.
If fixed fees are not paid in accordance with an agreed payment plan or on a monthly basis, we will stop work on your matter. That is disruptive and may cause conflict in our relationship with you, which we wish to avoid. We want to be working on your matter and for you.
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