---
title: "Disclose the costs estimates before a settlement is executed"
url: "https://ailawframework.com/obligations/costs-billing-and-litigation-funding/disclose-the-costs-estimates-before-a-settlement-is-executed"
type: "task"
site: "AI Law Framework"
id: "A42-PE20261022-23"
practice_area: "Costs, billing & litigation funding"
tier: "yellow"
lawyer_review: "required"
last_reviewed: "2026-10-22"
---

# Disclose the costs estimates before a settlement is executed

> From the figures the lawyer supplies for a litigious matter, assemble a working note of a reasonable estimate of the legal costs payable by the client if the matter is settled, including any legal costs of another…

Canonical page: https://ailawframework.com/obligations/costs-billing-and-litigation-funding/disclose-the-costs-estimates-before-a-settlement-is-executed  
Last reviewed: 2026-10-22

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Costs, billing & litigation funding](https://ailawframework.com/obligations/costs-billing-and-litigation-funding.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | From the figures the lawyer supplies for a litigious matter, assemble a working note of a reasonable estimate of the legal costs payable by the client if the matter is settled, including any legal costs of another party that the client is to pay, and a reasonable estimate of any contributions towards those costs likely to be received from another party. Record that section 177 requires the disclosure before the settlement is executed. If the lawyer says this practice was retained by another law practice, record the exception and whether that other practice will make the disclosure. Do not draft the settlement. |
| What the lawyer must review | The lawyer decides the estimates, whether the matter is litigious, whether the exception applies, and makes the disclosure to the client before the settlement is executed. |
| Written for / versions | 1 jurisdiction versions below |

## Checking plan

**Source-by-source verification**

Trace relied-on content to independent sources and check for relevant material the output has missed.

- What the AI does: From the figures the lawyer supplies for a litigious matter, assemble a working note of a reasonable estimate of the legal costs payable by the client if the matter is settled, including any legal costs of another party that the client is to pay, and a reasonable estimate of any contributions towards those costs likely to be received from another party. Record that section 177 requires the disclosure before the settlement is executed. If the lawyer says this practice was retained by another law practice, record the exception and whether that other practice will make the disclosure. Do not draft the settlement.
- What the lawyer does: The lawyer decides the estimates, whether the matter is litigious, whether the exception applies, and makes the disclosure to the client before the settlement is executed.
- Who reviews: Responsible lawyer with competence in the matter
- Basis: Practical workflow informed by the linked primary sources; the traffic light and working checks are editorial guidance, not a court classification.
- Why: The level reflects what the work is, the consequence of an error, and how much of the output the lawyer must independently re-derive.

## Checks the lawyer makes

1. The note has both estimates: costs payable by the client if settled, including another party's costs the client is to pay, and contributions likely to be received.
2. The disclosure is timed before the settlement is executed.
3. The retained-by-another-practice exception is applied only where the lawyer says the other practice makes the disclosure.
4. The note does not draft the terms of settlement.

## Notes

- These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.

## Sources

- [Legal Profession Uniform Law (NSW) s 177, disclosure before settlement](https://classic.austlii.edu.au/au/legis/nsw/consol_act/lpul333/s177.html) (checked 2026-10-22)

## Jurisdiction versions

| Jurisdiction | Level |
| --- | --- |
| [United States](https://ailawframework.com/obligations/costs-billing-and-litigation-funding/disclose-the-costs-estimates-before-a-settlement-is-executed/united-states.md) | Yellow |

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*