Legal Aid NSW Policy Online
Document Type: Policy
Chapter:11. Contributions


11.1. Initial Contributions

Introduction

Legal Aid NSW has the power to determine an initial contribution amount and a contribution to legal costs.

Legal Aid NSW imposes an initial contribution in most legally aided matters. Initial contributions are not voluntary and payment of the contribution is a condition of the grant of legal aid. This means a legally aided person must pay the contribution amount imposed unless it has been waived. The power to determine an initial contribution is under s.36 of the Legal Aid Commission Act 1979 (NSW). The initial contribution is based on a person’s income and assets at the time legal aid is granted.

Initial contributions are payments that go towards the costs of providing the legal service to the legally aided client. It is important that we collect contributions from clients who can afford to pay. Initial contributions are an integral part of the revenue of Legal Aid NSW, and as such, ensure we can continue to provide legal representation to socially and economically disadvantaged people across New South Wales.

All legally aided persons need to be aware at the time aid is granted that the initial contribution must be paid, unless it has been waived.

Legal Aid NSW must make a determination under s.46 of the Legal Aid Commission Act 1979 (NSW) in every matter. This is called a contribution to legal costs. These contributions are imposed either at the end of a matter or if legal aid is terminated.

Legal Aid NSW also has the power to defray expenses incurred under s.33 of the Legal Aid Commission Act 1979 (NSW).

11.1 Initial contributions

Initial contributions are contributions determined under s.36 of the Legal Aid Commission Act 1979 (NSW).

Legal Aid NSW will determine an initial contribution in every matter unless it is an exempted matter.

The initial contribution is a contribution requested at the beginning of a grant of legal aid and payment of the contribution by the due date is a condition of the grant of legal aid.

See Contributions Guideline 5.1.1.

11.1.1 Initial contribution calculated by the Means Test

Initial contributions are calculated using the Means Test.

The Means Test:

See Means Test policy 7.8 for scale on calculating contribution on the applicant’s net assessable income.

See Means Test policy 7.13 for scale on calculating contributions on the applicant’s net assessable assets.

See also Contributions Guideline 5.1.

11.1.2 Exercising a discretion under the Means Test to vary the initial contribution

Legal Aid NSW can exercise discretion to vary the initial contribution amount by increasing or reducing the amount calculated under the Means Test at the time legal aid is granted.

See Means Test Policy 7.10.2 for what needs to be taken into account when exercising the discretion to reduce a contribution amount so an applicant is eligible for legal aid.

See Contributions Guideline 5.1.5 on paying by instalments.

See Contributions Guideline 5.1.6 on payment methods available.

11.1.3 Once imposed, can an initial contribution be reduced?

Once imposed, an initial contribution can only be reduced where Legal Aid NSW is satisfied that there are exceptional circumstances.

See Contributions Guideline 5.2 on exercising discretion.

Only Legal Aid NSW officers authorised under the Delegation Instrument can reduce the contribution.

11.1.4 Once imposed can an initial contribution be increased?

Once imposed an initial contribution can be increased in circumstances where Legal Aid NSW is satisfied the legally aided person’s financial circumstances have changed.

See Means Test 7.8 for scale on calculating contribution on the applicant’s net assessable income.

See Means Test 7.13 for scale on calculating contributions on the applicant’s net assessable assets.

11.1.5 Can a legally aided person appeal against an initial contribution?

A legally aided person can appeal to the Legal Aid Review Committee (LARC) against the amount of the initial contribution imposed except in Local Court criminal matters.

There is no right of appeal to LARC against the decision to impose an initial contribution or the amount of the contribution in Local Court criminal matters.

For all other appeals see Policy on Legal Aid Review Committee Appeals.

See Contributions Guideline 5.2 on exercising discretion to reduce or waive an initial contribution.

11.1.6 Can initial contributions be refunded?

The only time a legally aided person will be entitled to a refund is where the contribution amount paid exceeds the costs and expense of providing the legal service (calculated at the appropriate Legal Aid fee scale).

The refund amount will be the difference between the amount that has been paid and the costs of providing the legal service.
Note: the minimum $75 contribution will never be refunded.

What if the client pleads guilty in a Local Court defended matter?

Where a legally aided person has paid a minimum contribution for a Local Court defended hearing and subsequently pleads guilty, that client will not be entitled to have the contribution refunded.

11.1.7 Can legal aid be terminated for failure to pay the initial contribution?

A contribution is a condition of the grant of legal aid.

Legal aid will only be terminated where the legally aided person fails to pay an assessed initial contribution amount of $1000 or more.

See Termination Policy on terminating legal aid where a legally aided person fails to pay the initial contribution.




Date Last Published: 01/07/2019

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11.2. Can contributions be secured upfront?

11.2 Can contributions be secured upfront?

Under s 34B of the Legal Aid Commission Act 1979 (NSW), Legal Aid NSW has the power to require a legally aided person to provide security for the costs of providing the legal service by requesting an equitable charge over real property.

A legally aided person will be required to give a charge over real property as a condition of the grant of legal aid:

to secure the total costs and expense of providing the legal service determined under s.46 of the Legal Aid Commission Act 1979 (NSW), unless it is an exempted matter.

See Contributions Policy 11.3 on final contributions.

See Contributions Guideline 5.4 on securing contributions with a charge over real property.

Note: There is discretion not to take a charge where Legal id NSW is satisfied there are exceptional circumstances. Directors have the delegation to exercise this discretion.

Note: The requirement for the legally aided person to give a charge over real property also applies to any financially associated person. See the Means Test 7.3: Whose means are considered when applying the Means Test?. See also Policy 7.6.2 for Asset test in all other matters.

Date published 1/7/2019

11.3. What is a contribution to legal costs?

A contribution to legal costs is a determination made under s.46 of the Legal Aid Commission Act 1979 (NSW) (the Act) and is a contribution imposed on a legally aided person at the end of a grant of legal aid.

Legal Aid NSW must make a determination under s.46 of the Act in every matter where a grant of legal aid is made. In deciding whether the legally aided person will be required to pay a final contribution amount and the amount of that contribution, Legal Aid NSW will take into account whether:

See Contributions Policy 11.3.3 for calculating the contribution where a person owns real property.

See Contributions Policy 11.3.4 for calculating the contribution where a person’s financial circumstances have changed.

See Contributions Policy 11.3.5 for calculating the contribution where a person recovers or retains an interest in property or money.

See Contributions Policy 11.3.7 for calculating the contribution where costs have been awarded in favour of the legally aided person.

11.3.1  When is the contribution to legal costs to be determined?

Legal Aid NSW will make a determination under s46 of the Act:

See Contributions Guideline 5.5 on making a determination under s46 of the Act.

11.3.2  When should a legally aided person be notified that a contribution to legal costs determination will be made?

The legally aided person and their lawyer must be advised in writing at the time aid is granted that a determination under s46 of the Act will made at the end of the grant of aid and that the client may be required to make a contribution under s46 of the Act.

11.3.3  Calculating the contribution to legal costs where the legally aided person owns real property

Where the legally aided person owns real property, unless it is an exempted matter, Legal Aid NSW will determine that the contribution to legal costs will be equal to the total costs and expense of providing the legal service.

Note: The total costs and expenses will include costs incurred under s.33 of the Act.

Note: This policy does not apply to grants of aid made prior to 1 June 2015 where a charge was not required as a condition of the grant.

See Contributions Guideline 5.5.1 for calculating a contribution where a person owns real property.

Note: There is discretion to reduce the contribution to legal cost where Legal Aid NSW is satisfied there are exceptional circumstances. Only Directors have the delegation to reduce the final contribution.

Note: Where legal aid is granted under Family Law Policy 5.6: property settlement after separation the determining officer must consider Family Law Guideline 2.19 Significant Financial Benefit Test before calculating the client’s contribution to legal costs.

11.3.4 Calculating the contribution to legal costs where the legally aided person's financial circumstances have changed

Where Legal Aid NSW is satisfied the legally aided person's financial circumstances have changed, when calculating the amount of the final contribution, Legal Aid NSW will:

Note: This policy does not apply to matters under Part II of the Veterans' Entitlements Act 1988 (Cth) or under the Military Rehabilitation and Compensation Act 2004 (Cth) where the means test is not applied.

Note: The total costs and expenses will include costs incurred under s.33 of the Act.

See Contributions Guideline 5.5.2 for guidance on calculating a contribution where the person’s financial circumstances have changed.

Note: There is discretion to reduce the contribution to legal cost where Legal Aid NSW is satisfied there are exceptional circumstances. Only Directors have the delegation to reduce the final contribution.

11.3.5 Calculating the contribution to legal costs where the legally aided person recovers money

Centrelink and Child Support back payments

Legal Aid NSW will not take into account any money received by way of back payment in social security matters or lump sum amounts received in child support matters when calculating the contribution to legal costs.

Where a legally aided person recovers $5,000 or less

Legal Aid NSW will not take into account any money recovered up to $5,000 when calculating the contribution to legal costs.

How will Legal Aid NSW calculate the contribution to legal costs where a person recovers more than $5,000?

The total costs of providing the legal service will be imposed on any amount recovered over $5,000.

Note: There is discretion to reduce the contribution to legal cost where Legal Aid NSW is satisfied there are exceptional circumstances. Only Directors have the delegation to reduce the final contribution.

See Contributions Guideline 5.5.3 on calculating the contribution amount.

Note: Where legal aid is granted under Family Law Policy 5.6: property settlement after separation the determining officer must consider Family Law Guideline 2.19 Significant Financial Benefit Test before calculating the client’s contribution to legal costs.

11.3.6 Calculating the contribution to legal costs where the legally aided person retains or recovers an interest in real property

Where Legal Aid NSW is satisfied that the legally aided person has recovered or retained an interest in real property, Legal Aid NSW will determine that the final contribution amount payable will be equal to the total costs and expense of providing the legal service.

The calculated amount can be secured by a charge and registered caveat against the real property.

Any initial contribution that has been paid by the legally aided person will be deducted from the final amount calculated under s46 of the Act.

Note: The total costs and expenses will include costs incurred under s.33 of the Act.

See Contributions Guideline 5.5 on calculating the contribution amount.

Note: There is discretion to reduce the contribution to legal cost where Legal Aid NSW is satisfied there are exceptional circumstances. Only Directors have the delegation to reduce the final contribution.

11.3.7  Calculating the contribution to legal costs where legal aid is terminated

When calculating the contribution to legal costs where:

Legal Aid NSW will determine that the contribution to legal costs will be equal to the total costs and expense of providing the legal service.

In all other circumstances, Legal Aid NSW will impose the contribution in accordance with Contributions Policy 11.3.3, 11.3.4 or 11.3.5.

Note: The total costs and expenses will include costs incurred under s.33 of the Act.

See Contributions Guideline 5.5.5 on collecting contributions when legal aid is terminated.


11.3.8 Calculating the contribution to legal cost where costs are awarded to the legally aided person

Where costs are awarded by a court or tribunal in favour of the legally aided person all of these costs must be paid directly to Legal Aid NSW. The lawyer representing the legally aided person is responsible for recovering costs awarded to the legally aided person.

Calculating the contribution to legal costs

Where the legally aided person is awarded costs by a court or tribunal, or if the terms of settlement include costs payable to the legally aided person, when calculating the final contribution amount, Legal Aid NSW will take into account:
whether:
See Contributions Policy 11.3.3 where the legally aided person owns real property and the final contribution amount has been secured by way of an equitable charge over the real property.

See Contributions Policy 11.3.4 for calculating the contribution amount where a legally aided person’s financial circumstances have changed.

See Contributions Policy 11.3.5 for calculating the contribution amount where a legally aided person has recovered money.
See Contributions Policy 11.3.6 for calculating the contribution amount where a legally aided person has recovered or retains an interest in property.

Note: In circumstances where the legally aided person fails to instruct their lawyer to recover the costs, Legal Aid NSW can obtain an assignment of the right of the legally aided person to recover such monies under s45 of the Act.

See Contributions Guideline 5.9 for guidance on how and when an assignment of the right of the legally aided person to recover such monies should be sought.

11.3.9 Notifying the legally aided person that a contribution to legal costs has been imposed

Legal Aid NSW must notify the legally aided person within a reasonable timeframe that a contribution under s.46 of the Act has been imposed, and:

Note: The timeframe for payment is forty-two (42) days unless specific arrangements for payment have been entered into between the legally aided person and Legal Aid NSW.

11.3.10 Right to have costs of private lawyer assessed

Where a legally aided person is required to pay a final contribution, they are entitled to have the costs of a private lawyer assessed or taxed.

See Contributions Guideline 5.7 on having the legally aided person's costs assessed.

11.3.11 Can a contribution to legal costs be varied?

A contribution to legal costs amount can be varied by a later determination to increase or decrease the calculated amount where Legal Aid NSW is satisfied that the original amount was not imposed in accordance with the Contribution Policy.

The only circumstance in which a contribution amount that has been paid by a legally aided person can be refunded is where the original amount paid was incorrect.

See Contributions Guideline 5.8.1 on what may be taken into consideration when reducing the calculated contribution in these circumstances.

Reducing the calculated contribution amount after it has been imposed

Note: There is discretion to reduce the contribution to legal cost where Legal Aid NSW is satisfied there are exceptional circumstances. Only Directors have the delegation to reduce the final contribution.

Note: A contribution to legal costs can only be varied (either by reducing or increasing the amount) up to six months after it has been imposed.

11.3.12 Can a contribution amount be refunded once it has been paid?

The only circumstance in which a contribution amount that has been paid by a legally aided person can be refunded is where the original amount paid was incorrect.

Section 64 of the Act sets out the circumstances in which money can be paid out of the Legal Aid Fund. These provisions do not cover payments to a legally aided person unless it is money owed under s.44 of the Act.  As such the power to make payments from the Legal Aid Fund is limited by s.64 of the Act.

See Contributions Guideline 5.10 on refunding a final contribution.

11.3.13 Can a legally aided person appeal to the Legal Aid Review Committee against the amount of a contribution to legal costs

There is no right of appeal to the Legal Aid Review Committee against the decision to impose a contribution to legal cost or the amount of the contribution.


Date Last Published: 9/7/2019

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11.4. Exempted matters - where an applicant is not required to pay an initial contribution

11.4 Exempted matters – where an applicant is not required to pay an initial contribution

These are matters that are exempted from an initial contribution imposed under s.36(1)(a) of the Legal Aid Commission Act 1979 and matters that are non means tested.

Criminal

Family

Civil

Last date published 1/7/2019

11.5. Exempted matters - where an applicant for legal aid owns real property

Criminal

Family

Civil

Note: A legally aided person who received a grant of aid prior to 1 June 2015 is not be required to give a charge over real property they own as a condition of the grant.

Note: A legally aided person acting as a guardian ad litem is not required to give a charge over real property they own as a condition of the grant.

Last date published 1/7/2019