“If you are in a dispute with someone, as soon as you go through a lawyer’s door you have grabbed a tiger by the tail,” Federal Attorney-General Robert McClelland told a no-doubt startled audience of lawyers in Perth last Friday.

McClelland’s speech drew a predictably negative response from the industry leaders. But the reality of life in Australia today is that despite almost two decades of chanting the mantra about reducing the cost of justice, if you are not a mega corporation or a low-income individual lucky enough to qualify for legal aid then the cost of legal services is literally a drain on the finances that cannot be sustained.

There is a dearth of statistics on the cost to business — and therefore the consumer who pays through increased prices — of legal services each year. But one survey, conducted in 2008 by the Australian Corporate Lawyers Association and its New Zealand counterpart of more than  125 in-house legal departments across 30 industries found that about 75% spent more than $1 million on in-house legal costs annually. “In Australia, a third had spent less than $700,000; more than 60% had spent more than $1 million; and 15%, more than $5 million,” the report noted. Add to this the use of external legal advisers and the average spend is likely to be more than $1.2 million.

At the other end of the scale is the average middle-class person who, if they want to access the court system, will face prohibitive court fees as well as lawyers’ costs. To file for a divorce in the Family Court, for example, a simple process, means handing over $482 to the court registry. If you want a lawyer to chase up a debt owing to you of say $10,000 in the Magistrates’ Court in Victoria, that court’s latest costs scale says it will set you back $507. Photocopying is a dollar per page, and if you ring your lawyer even for two minutes to check progress of the matter it could cost $38.

McClelland’s office told Crikey that he cannot tell the courts to reduce their fees because that would tread on judicial independence — a fair point.

Then there is the cost of delay — waiting for years to resolve disputes. A case decided last Friday in the Supreme Court of Tasmania in which a businessman sued a firm of lawyers for negligent advice given in 1991, took 17 years to resolve. In criminal cases, individuals and their families regularly have to endure emotional and financial stress of a significant kind for anywhere between 12 months and four years after they are charged with an offence.

It is not all the fault of the lawyers. The knee-jerk response of governments of all persuasions today to regulate every nook and cranny of business and community life means that legal disputes are inevitable.

We need to think about how we actually resolve disputes. Why do we have expensive criminal trial processes that have changed little in 100 years? Is it necessary to produce volumes of documents in a commercial dispute when the facts of the matter could be reduced to a few pages if the parties put their minds to it? Traffic matters and drink-driving charges, which take up so much court time could be dealt with by administrative means if there is no contest about the facts, surely.

McClelland has set the cat among the pigeons in his excoriation of lawyers last week. But he and his fellow AGs around Australia need to pull apart the structures and systems that stem from ancient times but which are operating well past their used by date.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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