Legal fee proposal
Legal fee proposal with fixed stage fees and costs disclosure
A legal fee proposal tells the client how they will be charged, what the whole matter is likely to cost, and what rights they have about those costs. This example from a Melbourne practice acting on the sale of a cafe sets three fixed stage fees totalling $6,400 plus GST, shows disbursements separately, and includes the costs disclosure a client is entitled to under the Uniform Law.
The proposal, page by page
Every page as the client sees it and as it prints, pricing table included.
The pricing, line by line
- Stage 1: Terms and due diligence
- 1 × $1,800.00
- Stage 2: Contract and lease assignment
- 1 × $3,200.00
- Stage 3: Settlement
- 1 × $1,400.00
- Searches and certificates
- 1 × $180.00
- Landlord's legal costs on the assignment (optional)
- 1 × $950.00
- Tax
- $735.00
- Total
- $8,265.00
- Deposit due on acceptance
- $1,980.00
Section by section
- Cover
- A contract cover naming the matter, a fixed fee basis and the principal.
- About us
- The practice, its focus on small business sales, and who runs the matter.
- Understanding your needs
- A sale with agreed terms, equipment, goodwill and a lease assignment needing consent, settling by January.
- Our approach
- Check the terms, contract and consent, settle.
- Deliverables and timeline
- Advice, the contract, the lease assignment and settlement, across four months.
- Investment
- Three fixed stage fees, searches at cost with no GST, and the landlord's estimated costs.
- Costs disclosure
- The total estimate, how changes are notified, and four rights the client has about costs.
- Terms
- A fixed deposit for stage 1, changes to the matter, ending the engagement, documents and a 21 day validity.
- Next steps and acceptance
- E-sign by the client after an email code, countersigned by the principal.
What makes a legal fee proposal different
In Victoria, New South Wales and Western Australia the Legal Profession Uniform Law requires a law practice to disclose its costs to a client in writing, generally before or as soon as practicable after being retained, unless the legal costs are not likely to exceed $750. The disclosure must explain how costs will be calculated, give an estimate of the total legal costs, and tell the client about their rights. A fee proposal is a natural place to do it, because the client reads it before deciding. This example adds a Costs disclosure section after the pricing table rather than burying the information in the terms, so the estimate and the rights sit right next to the numbers they relate to. Check the current requirements with the regulator in your state before relying on this layout.
How the fees and disbursements are shown
The three stages are fixed at $1,800, $3,200 and $1,400, which is the $6,400 legal costs estimate. Searches and certificates are estimated at $180 and carry no GST, which the line says. The landlord's legal costs are estimated at $950 and are selected by default but optional, because the client may have negotiated them away in the heads of agreement. With both, the subtotal is $7,530 and the total is $8,265, which includes $735 of GST: $640 on the legal fees and $95 on the landlord costs. The deposit is fixed at $1,980, exactly stage 1 with GST, so the client pays for the first stage up front and the rest as each stage is finished.
How to adapt this proposal
Price by stage where the work divides naturally, as a business sale does, and put each stage's output in the deliverables. If you charge hourly, state the rates for each person and estimate the hours per stage instead. Keep government fees and third party costs as separate lines with the right tax treatment. Write the rights in plain language. If your client is a large company that counts as a commercial client under the Uniform Law, the disclosure obligations differ, so check which apply. And keep the promise to update the estimate in writing, because that is also an obligation, not just good manners.
What makes this proposal work
The estimate is one figure
The costs disclosure section states a single total estimate of $6,400 plus GST for legal costs, made of three fixed stage fees, with disbursements estimated separately in the table. The Victorian regulator's guidance asks for a total estimate a client can rely on.
Rights are written in plain words
Four bullets tell the client she can negotiate the agreement and billing, ask for an itemised bill, ask for progress reports, and contact the regulator about a costs dispute. A client who reads them is more likely to trust the fees, not less.
Third party costs are not a surprise
The landlord's legal costs on the lease assignment are a separate line, estimated at $950, selected by default because most leases make the tenant pay them. The client sees the real cost of selling, not just the firm's fee.
Questions people ask
What should a legal fee proposal include?
The matter and its stages, what you will deliver, a timeline, how fees are calculated, an estimate of total legal costs, disbursements and third party costs, payment terms, the client's rights about costs, how the engagement ends and how to accept. This example puts all of it in a few pages, with a separate costs disclosure section.
Do lawyers have to disclose their fees in advance?
Under the Legal Profession Uniform Law, which applies in Victoria, New South Wales and Western Australia, a law practice must generally disclose in writing how costs are calculated and an estimate of total legal costs, unless they are not likely to exceed $750. Between $750 and $3,000 a standard short form may be used.
What rights does a client have about legal costs?
The Victorian regulator's guidance lists the right to negotiate a costs agreement and the billing method, to receive a bill and request an itemised one, and to seek the Victorian Legal Services Commissioner's help in a costs dispute. This proposal lists those rights in its costs disclosure section, alongside a right to ask for progress reports.
Are disbursements included in a fixed legal fee?
Usually not. Disbursements such as search fees are passed on at cost, and this example lists them separately: $180 of searches with no GST, and an estimated $950 for the landlord's legal costs that the lease makes the tenant pay. Showing them in the table keeps the fixed fee honest.
Can a legal fee proposal be signed electronically?
This one is. The client signs first after confirming a code sent to her email, then the principal countersigns, and only then is the first invoice issued. The signed PDF is stored with the acceptance. Check whether any document in your matter has its own execution requirements before relying on electronic signing for it.
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