GUIDELINES FOR TAXING COMMITTEE FOR THE ASSESSMENT OF NON LITIGIOUS FEES

Transcription

1 GUIDELINES FOR TAXING COMMITTEE FOR THE ASSESSMENT OF NON LITIGIOUS FEES 1. GENERAL APPLICATION OF THE GUIDELINES 1.1 The Council and members of the committees entrusted with the determination of fees will assess the fees, having due regard to Rule 15(b) of the Free State Law Society rules, namely:- 15(2)(b) With a view to affording the practitioner reasonable and adequate remuneration for the services rendered by him, the Council or the committee, as the case may be, shall, on every assessment, allow all such fees as appear to it to have been reasonable for the performance of the work concerned, and in so doing shall take cognisance of the following:- (i) the amount and importance of the work done; (ii) the complexity of the matter or the difficulty or novelty of the work or the questions raised; (iii) the skill, labour, specialised knowledge and responsibility involved on the part of the practitioner; (iv) the number and importance of the documents prepared or perused, without necessarily having regard to length; (v) the place where and circumstances in which the services or any part thereof were rendered; (vi) the time expanded by the practitioner; (vii) the importance of the matter to the client; (viii) the quality of the work done; (ix) the experience or seniority of the practitioner; (x) any guidelines of fees approved by the Society for the sole purpose of serving as a guide to practitioners; (xi) any tariff of fees prescribed by the Council in accordance with the provisions of section 69(d) of the Act; and (xii) whether the fees have been incurred or increased through over-caution, negligence or mistake on the part of the practitioner. 1.2 These guidelines shall not be applicable when a practitioner and the client enters into a written agreement regarding the fees and disbursements relating to any legal services rendered by the practitioner to its client. 1.3 The Council and members of the committees entrusted with the

2 determination of fees are of the opinion that members should be compensated at a tariff which has been determined according to the principles laid down and applied according to the time which should reasonably be taken up in the acceptance and execution of a particular mandate. 1.4 Committees which have to assess accounts must be enabled to: in respect of services rendered, determine a tariff for the work commensurate with the time basis; and to determine how much time would reasonable be expended in doing the work. 1.5 The Council proposes to its members that in these circumstances and in the execution of their duties, that they keep a note of the services rendered and in particular the time spent in rendering such service, notwithstanding the fact that they may be intending to render one account at the end of their services. Members must, when handing in specified accounts for taxation, clearly set out the hours, numbers of folios and particular work done in respect of each item of the account, to enable the Taxation Committee to make their calculations. 1.6 Members must bear in mind that the fees hereinafter set out include the costs of calculation and attendances on taxation of the accounts, which has been laid before the Taxation Committee. 1.7 Members must bear in mind that an attorney in general will not be permitted to increase his once off account at the time of taxation, unless the member, at the time of delivering the account, reserved the right to increase the amounts if permitted to do so by the Taxation Committee. 1.8 The relevant Taxation Committee shall, in determining a reasonable and fair fee, apply the guidelines applicable to research, appearances and consultations, drafting of written opinions and attendances which is considered by a particular committee as a reasonable parameter for the fees, but which is not binding on a lower or higher scale. 1.9 In regard to services reasonably rendered at the request of the client after hours, a surcharge of 50% on the fees will be allowed The Free State Law Society shall timeously give practitioners and complainants proper written notice of the date of the taxation. Practitioners, when requested to do so, are obliged to attend a Taxation of an account in matters which they attend to. If the specific

3 practitioner cannot attend same he must deputise a professional member of his firm who has knowledge of the matter to attend the Taxation in order to assist the Taxation Committee Should the practitioner not be able to attend the taxation when requested to do so, or should he or she fail to request a member or a candidate attorney of the firm who has knowledge of the matter to attend the Taxation, the Committee may refuse to tax the Account. If the member of the public is present at the taxation, the Taxing Committee has the discretion to tax the account in the absence of the member Members who require their disbursements to be taxed must furnish proof thereof and attach same to the Account The Council will only accept accounts drawn by the members and not by a Cost Consultant, except where the account is certified by the member When a specified account is filed for taxation, members must:- (a) file three copies of the specified account with the Council. Practitioners in Bloemfontein must furthermore lodge their files with the Council. Practitioners from the countryside must retain their file until requested for same by the Taxing Committee. (b) each item on the account must be numbered. (c) all times, numbers of folios or particulars of services rendered in respect of each item on the account must be specified. (d) the file must be available at the taxation and must be placed in date order. (e) ensure that any draft document etc is clearly marked, first draft, second draft, etc. (f) ensure that all amounts in respect of fees and disbursements are totaled on each page and carried forward to a final total. (g) lodge copies of all previous accounts which have been rendered in respect of the services set out in the account The Taxation Committee is entitled to return any accounts which do not comply with the above will be returned to the member to be drafted in accordance with the above requirements It is suggested that the following hourly tariffs serve as a guideline in respect of the items contained herein, namely:- Attorneys with 0-5 years experience: Attorneys with 5-10 years experience: R400,00/hour R800,00/hour

4 Attorneys more than 10 years experience: R1200,00/hour Research The hourly tariff set out in paragraph may serve as a guideline with the minimum time spent being 5 minutes or part thereof Appearances, consultations, attendances, drafting and perusal documents, traveling time and waiting time, subject to paragraph hereof: Formal attendances (e.g. service of a document by as attorney/master/magistrate R Attendances other than formal (per 15 minutes or part thereof) R Drafting of documents per page (minimum of 150 words): 4 pages per hour, subject to paragraph hereof Perusal per page (minimum of 150 words) R Correspondence formal letter per folio (including first copy) R Telephone attendances: formal : subject to paragraph hereof with the minimum time spent being 5 minutes or part thereof other than formal per 5 minutes or part thereof:- informal R Photo copies per page R Telefax and E Mail attendances (attendance to and over and above the drawing costs) R5,00 per page Traveling costs per kilometer R Traveling and waiting time R per 15 minutes or part thereof 1.17 The Council has resolved that the above guidelines are to be applied in the absence of an agreement to the contrary between the practitioner and the client in respect of all services rendered of a general nature such as:- Deeds of Sale Agreements for the sale of shares and members interest Lease contracts Applications to administrative bodies such as: The Liquor Board Local Road Transportation Board Valuation Court

5 Municipalities for Commercial Licenses Criminal work Deeds of Trust Services rendered in the Labour Court/the CCMA Arbitration matters. 2. COMPOSITE FEE For work which does not resort under 1 supra and for certain other work it may be more expedient and convenient to render a composite fee. Although these guidelines refer to such work, the Committees appointed to assess the calculation of accounts in certain instances follow the amounts set out in 1 in the Bills of Costs. 2.1 Registration of Companies A fee for the taking of instructions, including consultations, drawing the documents, preparation and comparing of company documents including an application for the issue of a certificate to commence business, but excluding disbursements and the costs of Pretoria attorneys: R Consultation fees are additional 2.2 Registration of Close Corporations Where applicable a separate consultation fee in accordance with the guidelines under 1 may be debited with: A fee for the taking of instructions, drawing, preparing and comparing all documents and attendances to register, excluding the drawing of an Association Agreement R In the event of an Association Agreement being required the members will be entitled to a fee, over and above their fee allowed in 2.2.1, for the drawing of such agreement in terms of the provisions of clause 1 above. 2.3 ADMINISTRATION OF TRUSTS Where a member is appointed as a Trustee or a Co Trustee, or acts for a Trustee: The fee may not exceed 1.5% of the value of the trust property A fee of 10% of the income recovered be collected but subject to negotiation The yearly fee on the capital assets of the Trust calculated at a fee of 2% on the value of the capital assets.

6 2.3.4 A reasonable collection fee, not to exceed 2% of the capital, at the termination of the Trust, or such other fee as directed from time to time by the Master of the High Court which will serve as remuneration of the Trustee at the termination of his Trusteeship, or as set out in the Trust Deed itself Over and above the monies referred to herein the Trustee will be entitled to his normal fee for all legal services rendered for and on behalf of the Trust. 2.4 DISTRIBUTION Taking of instructions and arranging distribution One to five creditors R More than five creditors R Distribution of monies A fee equal to 12% of the monies collected For each letter and enclosed cheque forwarded to creditors, provided however, that distributions do not take place more than once a quarter R COLLECTIONS 3.1 Rentals In regard to rentals for farms: 5% of the installment in respect of monies collected. Regarding any other rentals recovered a fee equal to between 7% and 10% of the payment recovered. 3.2 In regard to the purchase price of immovable property available in installments in terms of the Alienation of Land Act, 68 of 1981, or in circumstances where the Act is not applicable, as well as the collection of current interest on mortgage bonds, a fee equal to between 7 and 10% of the payment collected. 3.3 Collection of interest on mortgage bonds: A fee equal to between 7 and 10% of each installment. 3.4 ORDINARY DEBT COLLECTION Attorney and client monies: COLLECTION MAGISTRATES COURTS WORK The amounts set out herein are a guideline and practitioners are requested to consider whether the circumstances are fair and reasonable when debiting the fees concerned. Members are reminded that the collection commission referred to in hereunder is a maximum fee.

7 A member who has been requested to collect monies for any nature can, over and above their professional fees, (e.g. actions for the institution in a Court of law) are to debit the following attorneys and client fees: Instructions prior to judgment a fee of: (a) R35.00 for claims up to R (b) R75.00 for claims from R R (c) R for claims from R R (d) R for claims from R R (e) R for claims above R Instructions after judgment: (a) R50.00 for claims up to R (b) R95.00 for claims above R R30.00 for each necessary letter, telefax, received as well as for any necessary attendance (informal) For each consultation or telephonic attendance with a debtor, for 15 minutes or part thereof R Collection commission at a rate of 10% with a maximum of R per payment. 4. INSOLVENT ESTATES 4.1 Taking instructions to prove a claim, drawing a Special Power of Attorney, Resolution and Affidavit R Appearance fee at a meeting of creditors for 15 minutes or part thereof R POWER OF ATTORNEYS Drawing of a Special and General Powers of Attorney per page R ADMINISTRATION OF DECEASED ESTATES 6.1 The guidelines set out in this paragraph 6, is subject to the Administration of the Estates Act, Act 66 of 1965, as amended. 6.2 The minimum fee irrespective of the value of the Estate as prescribed by the Master of the High Court 6.3 Members must take note that in the absence of a special agreement with the Executor a statutory fee may not be exceeded. 6.4 When a member and appointed Co-Executor acts for and on behalf of an Executor, and no special arrangement has been made with regards to fees, such fee may not exceed the statutory Executors Fees chargeable. 6.5 When a member acts for an on behalf of the Executor, and such members mandate is terminated by the Executor, prior to the winding up of the Estate, the member shall be entitled to the fees whether an

8 agreement had been attained or not, to that portion of the agreed, or statutory fee, of the work which such member completed prior to termination of the mandate. General note: fees must be assessed in accordance with the tariff which was applicable at the time when the services were rendered. 7. CODE OF CONDUCT OF ATTORNEYS ATTENDING TO COLLECTIONS 7.1 At all times one must act in the interest of the Creditor but at the same time taking into account the interest and rights of the Debtor and especially also the image of the profession. 7.2 When a collection matter is defended then the tariff based on defended matters immediately becomes applicable and should any amounts in terms of paragraph of these guidelines have been debited then it must be accounted for at the defended tariff or at the agreed attorney and client tariff. 7.3 Collections commissions and attorney and client costs may only be charged to a debtor after judgment has been obtained therefore, or in the alternative in the event of an agreement being concluded with the debtor to this effect. Obviously an attorney who acts on behalf of a creditor will normally endeavour to obtain, in the interest of his client, an undertaking to pay the amount due together with the attorney and clients costs. When preparing such an agreement an attorney may not contract out of the guidelines as set out in paragraph Collection commission included all attendances and work done relating to the receipt of the funds and accounting thereof to the client in respect of such payment. 7.5 Certain necessary steps which are taken in an attorneys office in an endeavour to expedite the matter will not be accepted as attendances for the purposes of paragraph 3.4.3; for example the drawing of a file to attend to it (certain colleagues debit a fee on a regular basis to diarise and withdraw the file once a month,) the diarising of a file, the bookkeeping entries in respect of payments, the sending of monthly statements, the attendances on the payment of an account by client and the closing of the file. 7.6 A interest rate that mora interest may only be collected from the debtor if judgment has been given therefore or if it has been agreed to. The provisions of the Usury Act must at all times be adhered to. 7.7 An agreement relating to the estimated future attorney and clients costs is not acceptable. 7.8 As in the case of every other client, a collection s attorney must, within reasonable time after completion of the matter or at earlier termination of

9 the mandate, account to his client in writing. Please pay particular attention to the rules relating to the composition of the accounts. Accounting to the client is free to that client. 7.9 The balance due by a debtor must be given to him free of charge when reasonably requested to do so and if reasonable, a full statement setting out all the payments must also be given to him free of charge In collection matters an interim account can be given to client although such interim account may not have been agreed to beforehand Where an attorney accepts an instruction from a collection agent to act on behalf of the collection agent or his client, the provisions of Section 60 of Act 32 of 1944 must be taken into account an may not be transgressed by his client. The attorney must at all times ensure that he has the mandate A collection s attorney must guard against a conflict of interest where he is appointed as an administrator to do an administration or where he is doing a distribution on behalf of a client. It will usually be deemed to be conflict of interest where one of the creditors of an administration of distribution is also a client of the firm which is doing the distribution. The client (in this case the debtor as well as the creditor) can of course agree to this Where an attorney acts on behalf of more than one creditor against the same debtor one must guard against preferring one creditor above another, which is also a client, in negotiations and collecting of the amount due Only a once off attendance fee may be charged when an account if paid; for example, sheriff s and tracing agent s fees (some colleagues debit an attendance fee for the perusal of accounts and a separate fee for the drawing of a cheque. This is unacceptable to the Council The rules relating to the out maneuvering of a client of levying or exorbitant fees is mutatis mutandis applicable in the relationship between an attorney and a debtor.