Firm-wide obligation
Costs, billing & litigation fundingCosts, billing and litigation funding
Base costs and billing on the agreed terms, work actually performed and applicable requirements. Independently verify disclosure obligations, calculations and the allocation of checking or correction work.
Key facts
- Tasks covered
- 6
- Tasks with a step-by-step checklist
- 2
- Local differences
- 2 jurisdictions where this area changes
Jurisdiction
Tasks
GreenLawyer reviewYellowClose supervisionRedLawyer-led
| Task | How AI is used | Human involvement | What the lawyer must review |
|---|---|---|---|
| Draft a costs disclosure from the matter scope and the scale or estimate | Produce a first-draft disclosure from the scope, the estimate or scale the lawyer has named, and the firm's precedent, listing figures that still need an instruction. | YellowClose supervision |
|
| Bill time actually worked, including where a tool shortened the task | From the time file and the tool logs the lawyer supplies, list tasks where elapsed time and billed time may diverge. | YellowClose supervision |
|
| Draft a fee estimate that reflects generative-AI use | List the tasks the firm proposes to do with a tool and the tasks that remain timed lawyer work. | YellowClose supervision |
|
| Compare a funding, uplift or common-fund agreement to the current rules | Extract fees, success, control, termination and recovery terms into a table against the funding or contingency rules the lawyer has named. | RedLawyer-led |
|
| Build a draft bill from the time records and the disclosure | Turn the time entries into a draft bill grouped by task, with entries that sit outside the disclosed scope flagged. | YellowClose supervision |
|
| Compare a draft bill to the last costs disclosure and any updates | Line the bill up against the disclosure and list work, rates or totals that were not disclosed or updated. | YellowClose supervision |
|
| Draft an offer of compromise or without-prejudice costs letter from the approved figures | Produce a first-draft offer letter from the lawyer's approved figure, the costs-rule heading and the deadline. | YellowClose supervision |
|
| Review a bill for AI-assisted work | List items where AI reduced time and compare to charged time. | YellowClose supervision | Ensure costs are fair and reasonable (LPUL ss 172-173; ASCR r 12.2). |
What changes in New Zealand
| Topic | What changes |
|---|---|
| Fee rules | Chapters 3 and 9 of the Conduct and Client Care Rules, including the reasonable-fee factors. |
| AI and time billing | The Law Society asks you to review time-and-attendance billing if a tool now does work that used to be timed. |
| Not Australian law | No Australian costs-assessment scale or Federal Court scale. |
| Litigation funding | Check the FMCA if the arrangement is a financial product. |
What changes in United States
Known here as: Costs, billing and litigation funding
| Topic | What changes |
|---|---|
| Reasonable fees | Rule 1.5. Formal Opinion 512, Florida 24-1 and California's guidance: bill time actually spent, not time the tool saved. |
| AI overhead | Do not mark up general AI overhead without the agreement the local rule requires. |
| Funding | Contingency and litigation-funding arrangements are state law. No national scale of costs. |
- ABA Model Rule 1.5, Fees · 2026-09-23
- ABA Formal Opinion 512, Generative Artificial Intelligence Tools (29 July 2024) · 2026-09-23
- Florida Bar Ethics Opinion 24-1 · 2026-09-23
- State Bar of California, Practical Guidance for the Use of Generative Artificial Intelligence in the Practice of Law (2026) · 2026-09-23
Precedents for this area
- Uniform Law standard costs disclosure form (matters likely to cost $750 to $3,000): completion guide (Form, AI use Yellow). Links to the prescribed Uniform Law standard costs disclosure form (Form 1) and explains how to complete each part, when it may be used instead of a full disclosure, and what to do when the estimate grows.
- Costs disclosure and costs agreement letter (Uniform Law ss 174 and 180) (Letter, AI use Yellow). Full written costs disclosure for Uniform Law matters likely to exceed $3,000, which also operates as the costs agreement when accepted. Covers scope, basis of charging, estimate, billing, AI use and the client's statutory rights.
- Engagement and costs agreement clauses: AI use, client consent and charging for AI-assisted work (Clause, AI use Yellow). Clauses for engagement letters and costs agreements that tell the client how the firm uses AI, record consent or restrictions, and state how AI-assisted work and tool costs are charged.
- Billing and time-recording policy for AI-assisted work (Policy, AI use Yellow). Firm policy on recording time and billing for work done with AI tools, so bills reflect real legal work, efficiencies reach the client, and verification or rework does not inflate costs.
- Notice to client of a significant change in legal costs (Uniform Law s 174(1)(b)) (Letter, AI use Yellow). Letter that updates the client in writing when the scope, basis or likely total of legal costs changes significantly, explains the impact, sets out options and seeks instructions and consent.
- Litigation funding agreement review checklist (including class actions) (Checklist, AI use Red). Checklist for reviewing a third-party litigation funding agreement and the related costs agreement: commission, control, termination, adverse costs, conflicts, court disclosure and the contingency fee prohibition.
All precedents for Costs, billing & litigation funding. Signed-in accounts can read the full text.