Fixed fee: time of work is important for reimbursement of attorney's fees – SC
The procedure for calculating the hourly fee differs from the fixed fee, which does not take into account the actual time spent. However, in both cases, they are taken into account when deciding on the reimbursement of legal aid expenses.
This was pointed out by the Commercial Court of Cassation of the Supreme Court in its additional resolution No. 910/12155/22 dated February 13, 2024, the text of which has recently appeared in the USRCD.
Having won the dispute in the cassation instance, the company asked the court to recover legal aid costs in the amount of UAH 18 thousand from its procedural opponent. The latter considered this amount to be excessive and filed a motion to reduce the legal fees to UAH 3 thousand.
Among the reasons for reducing the costs, he pointed out that the amount of costs was not commensurate with the complexity of the case and the work performed by the lawyers.
The high judges reminded that the main grounds and principles for reimbursement of legal aid costs are set out in paragraphs 7.1 - 7.9 of the resolution of the Supreme Court of Ukraine dated 05.07.2023 in case No. 911/3312/21. Also, the Supreme Court composed of judges of the Joint Chamber of the CGS considered the issue of expenses for the payment of attorney's fees in its resolutions of 02.02.2024 in case No. 910/9714/22 and of 03.11.2023 in case No. 914/2355/21.
According to part 4 of Art. 126 of the EPC, the amount of expenses for attorney's fees should be commensurate with:
1) the complexity of the case and the work performed by the attorney (services rendered);
2) the time spent by the advocate to perform the relevant work (services);
3) the scope of services rendered by the advocate and work performed;
4) the value of the claim and (or) the importance of the case for the party, including the impact of the case resolution on the reputation of the party or public interest in the case.
In case of non-compliance with these requirements, the court may, at the request of the other party, reduce the amount of costs. In this case the burden of proving disproportionality of expenses is on the party applying for their reduction.
In the case under consideration the fixed amount of the fee was established. In this case, the actual amount of time spent by the attorney in providing services to the client is not calculated. The amount of the fee is determined only by agreement between the advocate and the client, and the court has no right to interfere in these legal relations. At the same time, the obligations between the advocate and the client are not binding on the court in the context of deciding on the distribution of court costs.
Therefore, a party may prove the disproportionality of expenses, including, but not limited to, without specifying in the detailed description of the work (services rendered) information about the time spent on the provision of legal assistance. And taking into account the specific circumstances, the court may limit the amount, taking into account the reasonable necessity of court costs in the case.
Taking into account the disproportionality of the amount of the fixed fee to the complexity of the case, the price of the claim, the volume of materials in the case, the number of procedural documents prepared, and the number of meetings, the Supreme Court concluded that the claimed amount of compensation for expenses was excessive, and therefore awarded it partially in the amount of UAH 10 thousand.
Popular news
Guarantees of the practice of law
Impunity for public stigmatization of advocates violates the constitutional right to defense
The prohibition of identifying an advocate with a client is an international standard enshrined in the Law «On advocacy and legal practice». However, without accountability, this guarantee does not work, which poses a direct threat to the realization of the right to defense and the principle of adversarial proceedings.
Legislation
Inheritance of a share in joint property and more: advocates have made comments
In the event of the death of one of the subjects of joint shared ownership, the shares of each of the co-owners in the joint shared ownership shall be deemed equal, unless otherwise agreed between them, by law, or by a court decision.
Legislation
Implementation of the Roadmap: the composition of the working group ensures a high level of expertise
The composition of the Working Group on the implementation of the Roadmap on the rule of law in relation to advocacy demonstrates the high institutional level of the experts involved by the Ukrainian National Bar Association in the formation of a package of decisions.
Legislation
UNBA initiatives to implement the Roadmap were supported by international experts
International experts who participated in the inaugural meeting of the Working Group on the implementation of the Roadmap on the rule of law in advocacy and agreed to join it expressed their support for the initiative of the Ukrainian National Bar Association.
Legislation
How will the group responsible for implementing the Roadmap for advocacy operate?
The working group on the implementation of the Roadmap on the rule of law in the area of advocacy will operate at several levels: plenary meetings as a platform for adopting framework decisions, a coordination bureau for compiling documents and calendar control, and thematic subgroups for preparing norms and their justification. International experts will verify the results against European standards and «red lines».
Legislation
Advocacy is a responsible entity, not a critic of reform — V. Gvozdiy
The Roadmap on the Rule of Law is not a basis for restructuring the model of advocacy, but a framework for verifying and improving the already European-oriented system. At the same time, part of the work has already been done, so further progress should be made in the form of coordinated and practical decisions.
Legislation
Vatras on the implementation of the Roadmap: only advocates should create their own destiny
Work on implementing the Roadmap in relation to advocacy should be based on the participation of the professional community itself, and key tasks should be structured in such a way as to avoid mixing processes that differ in content and procedure.
Legislation
Lidiya Izovitova outlined the approach to implementing the Roadmap for advocacy
The general approach to working on the implementation of the Roadmap on the Rule of Law in terms of reforming advocacy should not be based on «slogans», but rather on gathering facts, comparing them with standards, consulting with the professional community, and formulating norms for which participants are prepared to take responsibility.
Publications
Volodymyr Matsko Extradition as a systemic form of rights violations
Victoria Yakusha, Law and Business The anti-corruption vertical cannot «take care» of the Bar as an institution, - acting head of the HQDCB
Censor.net Protecting advocates – protecting justice: addressing concerns about the new law
Ihor Kolesnykov A BRIEF SUMMARY REGARDING THE APPLICATION OF THE ORDER ON EXTENDED CONFISCATION IN LATVIA REGARDING FINANCIAL ASSETS OF…
Valentyn Gvozdiy WORKING IN A WAR ZONE
Lydia Izovitova Formula of perfection
Sergiy Vylkov Our judicial system is so built that courts do not trust advocates
Iryna Vasylyk Advocacy in the proclamation of Independence of Ukraine