NSW Supreme Court affirms hourly rates allowed for law firm employee

Cost assessment and review

A costs assessor permitted the work of an employee of the law practice, who was not a qualified legal practitioner, at a specific hourly rate. In a determination dated 9 December 2024, the review panel allowed the work at higher hourly rates. 

Appeal to New South Wales Supreme Court

Before the NSW Supreme Court, the client wanted to challenge the review panel’s allowance of the employee’s work at higher rates. 

Through a summons dated 9 January 2026, the client appealed against the determination under s 89(1)(b) of the Legal Profession Uniform Law Application Act 2014, which gave a right to appeal from a review panel decision if the disputed costs were $100k or more. 

As the disputed amount was under $100k, the client needed and requested leave to appeal on two grounds. Specifically, he alleged that the review panel erred in: 

• allowing the employee’s hourly rate at $380 until 20 August 2022, at $395 up to 11 November 2022, and at $410 thereafter 
• considering the fact that the client did not lodge objections relating to all of the employee’s work when he obviously meant to confine the assessment to bigger cost items and limit the assessment costs 

The law practice objected to the client’s request for leave to appeal. 

NSW Supreme Court denies leave to appeal

The NSW Supreme Court dismissed the summons dated 9 January 2026. Thus, the court ordered the plaintiff client to pay the defendant law practice’s costs as agreed or assessed. 

First ground of appeal

In relation to his first ground of appeal, the client asserted errors in: 

• exercising discretion because the bulk of the employee’s work was legal work, not financial analysis work, and so elevating her work above the firm’s paralegals, senior law clerks, and even lawyers would be unreasonable 
• failing to adopt an hourly rate for the employee that aligned with the Costs Assessment Rules Committee’s guideline on “Costs Payable Between Parties Under Court Orders” 
• failing to consider the employee’s rate as against the “relative” rates charged by others handling the matter 

Upon considering the client’s arguments, the NSW Supreme Court saw no error of principle, no matter of public importance, and no injustice to justify granting leave. 

Second ground of appeal

The NSW Supreme Court explained that the client’s inconsistent approach could be a relevant matter within the scope of review, such that the review panel could consider that approach an implicit acceptance of the rate’s fairness and reasonableness on some occasions when the law practice had charged the employee’s work at that rate. 

Prior NSW Supreme Court cases

Here are some recent decisions by the Supreme Court of New South Wales. 

In a dispute involving the costs of a solicitor who acted in a personal injury proceeding, the NSW Supreme Court’s Court of Appeal issued a 28 August 2026 decision remitting the consideration of whether the costs were fair and reasonable to the District Court. 

The NSW Supreme Court’s appeal court made a 20 August 2026 decision dismissing an appeal against a decision of the NSW Civil and Administrative Tribunal confirming that a solicitor failed to meet the standard of competence and diligence expected of a reasonably competent lawyer. 

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