283Conditional costs agreements

283 Conditional costs agreements (1) A costs agreement may provide that the payment of some or all of the legal costs is conditional on the successful outcome of the matter to which the costs relate. Note 1 This is a conditional costs agreement (see s 261, def conditional costs agreement). Note 2 The Civil Law (Wrongs) Act 2002, pt 14.1 (Maximum costs for certain personal injury damages claims) and pt 14.2 (Costs in damages claims if no reasonable prospects of success) contain limitations on legal costs. (2) A conditional costs agreement may relate to any matter, except a matter that involves a criminal proceeding or a proceeding under the Family Law Act 1975 (Cwlth). (3) A conditional costs agreement— (a) must set out the circumstances that constitute the successful outcome of the matter to which it relates; and (b) may provide for disbursements to be paid irrespective of the outcome of the matter; and (c) must be— (i) in writing; and (ii) in clear plain language; and (iii) signed by the client; and (d) must contain a statement that the client has been told of the client’s right to seek independent legal advice before entering into the agreement; and (e) must contain a cooling-off period of not less than 5 business days during which the client may, by written notice, terminate the agreement. (4) Subsection (3) (c) (iii), (d) and (e) do not apply to a conditional costs agreement made under section 282 (1) (c) (which are costs agreements between law practices). (5) Subsection (3) (c) (iii), (d) and (e) also do not apply to a conditional costs agreement made with a sophisticated client. (6) If a client terminates a conditional costs agreement within the period mentioned in subsection (3) (e), the law practice— (a) may recover only the legal costs in relation to legal services performed for the client before the termination that were performed on the instructions of the client and with the client’s knowledge that the legal services would be performed during the period; and (b) without limiting paragraph (a), may not recover the uplift fee (if any).