What Is The 50/50 Rule In Personal Injury Compensation Claims?
In essence the “50/50 Rule” sets a cap on the fees you may be charged for your claim.
To explain in more detail, in Queensland, the rule applies in cases where the award of damages (or settlement sum) is less than the legal professional fees that could be charged under the Costs Agreement between the parties.
Or this happens if the professional fees are so high, that the claimant would be left with very little in-hand from their settlement sum. The “50/50 Rule” can be found in section 347 of the Legal Profession Act 2007.
Questions on this? You’re welcome to just give us a call, chat with you, or send an email to us. We’ll be glad to help you. There is no cost for the call or to speak to our lawyers, and you’re under no obligation.
Can I Get Compensation For My Injury?
We're Here To Help You, And So Is The 50/50 Rule.
Put plainly a Queensland no win no fee personal injury firm cannot breach the 50/50 rule.
The purpose of this rule is therefore to ensure that you as an injured claimant or plaintiff always achieves a fair share of their recovered damages.
It’s rarely needed but no matter how much the damages recovered are, unless some special circumstances apply, a No Win No Fee Personal Injury firm cannot breach this 50/50 Rule.
How Does The 50/50 Rule Work In A Compensation Claim?
1. Firstly you take the total gross settlement amount to be received for your claim;
2. From this is deducted any Statutory Refunds to be paid from your settlement sum (Statutory Refunds are such things as Refunds due to Workcover Queensland, Medicare Australia, DEEWR (for vocational rehabilitation) and Centrelink), as well as all disbursements incurred in the running of your claim (e.g. Medical report fees, barrister fees, court filing fees etc);
3. After these deductions are made, the resulting sum is then divided by two (2);
4. The end result is the total amount that you can only be charged for professional costs for your claim (including GST).
Is There An Example Of How The 50/50 Rule Works In Queensland Personal Injury Compensation Claims?
Compensation claims we manage often settle for far more, but for example let’s say:
- Your injury compensation claim only settled for $50,000.
- Fees under the Costs Agreement were, say $25,000.
Then professional costs could only be charged under the 50/50 Rule as follows:
½ X ($50,000 less (statutory refunds of say $5,000 in total, plus, disbursements of say $7,500)
This is ½ X ($50,000 – $12,500) and equates to ½ of $37,500 = $18,750.
So, the total of professional costs that could only be charged would be $18,750 despite legal fees really being $25,000.
You can read more about the 50/50 Rule and estimating your legal costs for injury claims.
Again, you’re welcome if you have any questions to just give us a call, chat with you, or send an email to us.
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Frequently Asked Questions
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