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Law change caps legal fees

notice | 28/10/2016

The Motor Accidents Compensation Regulation 2015 has been amended to cap legal costs for CTP Green Slip claims made on or after 1 November 2016, regardless of a prior costs agreement.

The changes implement a proposal made by the Bar Association, Law Society and Australian Lawyers Alliance in March this year to reduce the cost of legally represented small claims to the CTP scheme.

The changes:

  1. Prohibit contracting out of maximum solicitor-client costs for claims for a settlement or award of not more than $50,000.
  2. Protect the first $50,000 of a settlement or award from solicitor-client costs. (This means that the maximum solicitor-client costs cannot be more than party-party costs plus the difference between the settlement/award and $50,000).
  3. Limit legal costs to $5,000 for claims made by children under 18 years of age where the settlement or award amount is not more than $25,000 or if the same legal practice is bringing a claim on behalf of another occupant of the same vehicle.
  4. Limit legal costs to $10,000 for claims made by children under 18 years of age where the settlement or award amount is between $25,000 and $50,000.