Prior to 2013 the Bar operated under non-contractual default Terms of Work. Barristers did not generally opt to use contractual terms and in those circumstances it was not possible for barristers to sue for their fees. Their only remedy in the event of non-payment was through the Bar Council’s Fees Collection Scheme. See http://www.barcouncil.org.uk/supporting-the-bar/fees-collection/.
Barristers are now advised to establish clear contractual arrangements for their work. Guidance is provided on the Bar Council website at http://www.barcouncil.org.uk/practice-ethics/professional-practice-and-ethics/contractual-terms/.
Whether or not you will be entitled to sue for your fees if payment is delayed and how long you will have to wait before you can do so will vary depending on who is paying you and the contractual arrangements you have arrived at.
Privately paid work and work done for the GLD
- In the case of work done for large insurance companies and for the government via the Government Legal Department civil panel counsel fees are, usually, paid fairly promptly.
- If your work is under the Bar Contractual Terms then clauses 12.4-12.6 provide that the invoice must be paid within 30 days of delivery, without any set off. See https://www.barstandardsboard.org.uk/regulatory-requirements/the-old-code-of-conduct/annexes-to-the-code/annexe-t-the-(new)-standard-contractual-terms-for-the-supply-of-legal-services-by-barristers-to-authorised-persons-2012/. Failure to pay within that time will entitle the barrister to charge interest in accordance with the Late Payment of Commercial Debts (Interest) Act 1998 and/or sue for payment. In addition, you are entitled to refuse to do any further work on the case unless payment for further work is made in advance (subject to your obligations to the Court and other BSB Handbook provisions).
- If you are doing the work on the COMBAR and City of London Law Society terms then clause 9 provides for payment and billing arrangements – see http://www.combar.com/about-us/combar-clls-contract-terms/ and associated links. There are four different bases for payment: Basis A – solicitor should pay within 30 days of receipt of the invoice irrespective of whether the solicitor has been paid by the lay client; Basis B – solicitor is liable to pay the fees, but only when the solicitor has received the fees from the lay client; Bases C and D, the lay client is expected to pay the barrister and the solicitor is not responsible. Anecdotally, those who operate the COMBAR terms mostly use Basis B. Bases C and D differ slightly in that the solicitor is involved in agreeing counsel’s fee with the lay client in the former, but not the latter, but both suffer from the weakness that the solicitor plays no role in the billing of fees and does not chase payment on counsel’s behalf.
In reality even with the contractual provisions you may have to wait several months until you are paid. You should allow for a cash flow that is approximately 2-3 months ‘out’ from when you are billing.
Publicly funded work
The position in relation to publicly funded payments is significantly different.
In Legal Aid cases, because the money is coming from government, most barristers do not use contractual terms. However, the Bar Council has produced a clause that barristers can use in civil Legal Aid cases to give them contractual protection. See http://www.barcouncil.org.uk/practice-ethics/professional-practice-and-ethics/remuneration-guidance/funding-publicly-funded-civil-work/.
Legal Aid fees are paid by the Legal Aid Agency. The fee schemes and payment arrangements are complex and vary between the different fee schemes. The various regulations are in different places on the LAA website, but your clerks will be the first port of call and guidance.
In criminal cases in the Crown Court the average time for payment is around 3-5 weeks from the submission of a claim at the end of a case. The Legal Aid Agency will send an ‘assessed return’ and then payment. However, if there is a lack of records (such as a missing indictment or page count) this can delay payment. For Magistrates’ Court work in crime, regrettably, payment for counsel depends on when the solicitor bills the case, when they receive payment and when they pay your fees. If you are having consistent problems with a firm of solicitors not paying you for Magistrates’ Court cases talk to your fees clerks or contact the Bar Council’s Fees Collection Service (http://www.barcouncil.org.uk/supporting-the-bar/fees-collection/ or email Fees@BarCouncil.org.uk) or ethical enquiries/remuneration enquiry service (http://www.barcouncil.org.uk/supporting-the-bar/ethical-enquiries-service/, email Ethics@BarCouncil.org.uk or telephone 0207 611 1307).
Edna Hackman, Fees Clerk at Landmark Chambers explains the regime for payments in publicly funded civil cases:
Excluding family work, the three main types of Civil Legal Aid are Full Public Funding (also known as Certificated Work), Controlled Legal Representation (CLR) (for representation at mental health tribunals or asylum and immigration cases in the First Tier Tribunal), and Legal Help (advice and help with negotiating but not court work). Each of these types of funding is billed and paid differently, and has a different hourly rate. It is worth noting that there are sub-divisions for each funding type. Time frames given below are guidelines only: in reality the various processes involved in claiming fees can be significantly longer.
CLR and Legal Help
Fees for cases funded under CLR or Legal Help are payable by the solicitors and will only be paid once the case has completely finished. Solicitors submit a bill to the Legal Aid Agency covering their own fees, counsel’s fees and any disbursements. Payment is commonly received 3 to 6 months after the case is finished. It is not possible to make a claim for payment on account.
Legal Aid Certificated Cases
When a Legal Aid Certificate in place, payment is made directly to counsel by the Legal Aid Agency.
The date the certificate was issued dictates counsel’s hourly rate. How the fees are reconciled will depend on whether the certificate has been applied for via the LAA’s online Client Costs Management System (CCMS) or on paper.
Enhancements on final claims and payments on account can be requested on fees for work done under certificates granted on or after 02 December 2013.
Applications for payments on account are submitted directly to the LAA by Chambers. Payments will be made of:
- 12 months have elapsed since the certificate was issued;
- A payment on account has already been made and a further period of 12 months (or 24 months, if there have been 2 payments) has elapsed;
- The proceedings to which the certificate relates have continued for more than 12 months and it appears unlikely that an order will be made for the costs of the case to be assessed within the next 12 months and delay in the assessment of costs will cause hardship to counsel; or
- The proceedings to which the certificate relates have concluded or counsel is otherwise entitled to have the costs of the case assessed or paid but has not been paid for at least six months since first becoming entitled.
An application under (a) or (b) must be made within the period beginning two months before and ending four months after the event specified in the section.
So, for example, an application can be made:
- 10 – 16 months after issue of the certificate
- 22 – 28 months after issue of the certificate
- 34 – 40 months after issue of the certificate
This means that if you are instructed in a case where the legal aid certificate was issued on 2 January 2012 the window for applying for a payment on account is between 2 November 2012 and 2 May 2013. If the case then goes on it will be for the same period but the following year i.e. between 2 November 2013 and 2 May 2014. Counsel is only entitled to claim one payment on account annually. Payments are often processed within 6 weeks of submitting a claim.
The LAA will pay a maximum of 75% of the amount claimed and will take into consideration what is reasonable, any previous payments on account, the certificate cost limit and sometimes the scope of the certificate.
Further Payments on Account can be applied for but payment is at the discretion of the LAA.
At the end of the case if no order for costs has been granted against the other side the legally aided party is entitled to have costs paid by the LAA. The final fee note at Legal Aid rates should be sent to the solicitor to be included with their bill.
The LAA assesses bills under £2,500 (exc. VAT). Bills in excess of £2,500 are assessed by the Senior Courts Costs Office (SCCO).
Assessment by the SCCO can take 3-6+ months, and counsel’s fees can be assessed down. Counsel can appeal the amounts allowed regardless of whether the solicitor is appealing their profit costs and vice versa. No amount will be paid until all the costs are agreed.
If no appeal is lodged, or when fees are agreed, a certificate will be sent to the court for sealing (6+ weeks) and then the bill submitted to the LAA for payment (6 – 12+ weeks).
If counsel has been overpaid the LAA will recoup any monies owed from counsel; the LAA will not make any payments until there is a credit balance on the LAA system.
Should a costs order be awarded against the other side, the solicitor will submit a bill at inter partes rates to the other side. It is the solicitor’s responsibility to submit a Claim 2 informing there will be no claim against the LAA fund and that the certificate should be discharged. The LAA will then recoup any payments on account made to counsel and the solicitor.
The Family Legal Aid costs regime is significantly different.
Family Legal Aid: A Young Practitioner’s Guide
As someone just starting on their feet as a family barrister, you will quickly have to come to terms with one particular issue: legal aid.
Family barristers who practice solely in children work will be predominantly working for local authorities and for legally aided clients, be it children or parents. The one key thing to do in order to ensure that you are paid for legally aided work can be summed up in one word: “Billing”.
Legal aid work is billed using FAS forms (FAS = Family Advocacy Scheme). FAS forms need to be completed by you and signed by the judge or legal adviser after each hearing is completed – you need to ensure that the times are initialed as well as any “ticks”. There are a number of boxes on the forms that can be ticked depending on whether you qualify for those uplifts in each case (for example ticks for the size of the court bundle in pages). There is guidance on the back of the FAS forms as to the tick box criteria and this merits careful reading.
In order to successfully bill a hearing you will need to supply your clerks with the following:
- Fully completed, sealed and signed FAS form (do not forget to get the court usher/clerk to seal it using the family court stamp)
- A copy of the order listing the hearing with attendance times set out in the directions
- If it is a final hearing you will need a sealed copy of the final order (if the hearing is effective)
- A copy of your instructions, signed and endorsed
- A copy of the legal aid certificate (obtained from your instructing solicitors)
You may find that your billing clerks will obtain documents such as the legal aid certificate but this always merits checking.
If you follow the process set out above, you should be paid reasonably swiftly.
Conditional Fee Agreements
In some cases, you will be asked to work on a Conditional Fee Agreement (CFA) or Damages Based Agreement (DBA). The Bar Council publishes a guidance document explaining the range of different agreements possible. See http://www.barcouncil.org.uk/practice-ethics/professional-practice-and-ethics/remuneration-guidance/funding-privately-funded-civil-litigation/.
While many chambers do not expect pupils to undertake work on a CFA basis, you may be asked to accept particularly Personal Injury work on a CFA basis from early on in tenancy. Although you are entitled to seek an uplift under a CFA out of the client’s damages, anecdotally we have found that most solicitors expect counsel to accept work on a 0% uplift CFA or not at all. Remember that CFAs are an exception to the cab rank rule and you are entitled to refuse a case on a CFA basis for any reason (see BSB Handbook rC30.9.c).
Under a CFA, work will be billed immediately but you do not get paid unless and until the solicitors win or settle the case, so you may wait several years before either receiving or being asked to accept a reduction in fees. It is important to make sure that your clerks (or you) get regular (every six months or so) updates on the progress of the case so that you know when the case is due to come to trial or settle.
In addition to the above, you may be asked to agree to take work on a ‘deferred fee’ basis. This work is paid on a private basis (so you get the fees whether the case wins or loses), but you agree not to be paid until either the conclusion of the case or when the solicitor receives costs. This will mean that you may wait several months or even years for the fees (although in reality, you may not wait any longer for fees on a deferred basis than you would have if the solicitor was paying on the issue of fee notes). As with CFAs, it is important to make sure that your clerk keeps in touch with the solicitor to track the progress of the case so that your fees clerk knows when the case has concluded and when to start chasing for your fees.