---
title: "Disclosure of costs before a settlement is signed"
url: "https://ailawframework.com/precedents/costs-billing-and-litigation-funding/settlement-costs-disclosure"
type: "precedent"
site: "AI Law Framework"
id: "a42-settlement-costs-disclosure"
area_id: "A42"
kind: "letter"
ai_level: "yellow"
version: 1
task_ids: ["A42-PE20261022-23"]
law_stated_as_at: "2026-10-23"
---

# Disclosure of costs before a settlement is signed

> A letter giving the two costs estimates before a settlement of a litigious matter is signed, under the Uniform Law or the Queensland Act. The lawyer removes the statute that does not apply.

Canonical page: https://ailawframework.com/precedents/costs-billing-and-litigation-funding/settlement-costs-disclosure  
Law stated as at: 2026-10-23

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

## Key facts

- Kind: Letter. A letter or email you adapt and send.
- Practice area: [Costs, billing & litigation funding](https://ailawframework.com/precedents/costs-billing-and-litigation-funding.md)
- Jurisdictions: Victoria, Queensland, New South Wales
- AI level: Yellow. You and the tool draft together, with you directing. You check every statement you rely on.
- Law stated as at: 2026-10-23
- Status: Maintained. Checked on 2026-10-23 against the 4 authorities it cites, for Victoria, Queensland and New South Wales.

## When to use it

Use when a settlement of a litigious personal injury matter is about to be signed in Victoria, New South Wales or Queensland. Give it before the client signs. It is the costs disclosure. It is not the deed, and it is not the first costs agreement.

## Used for these tasks

- [Disclose the costs estimates before a settlement is executed](https://ailawframework.com/obligations/costs-billing-and-litigation-funding/disclose-the-costs-estimates-before-a-settlement-is-executed.md)

## How AI may be used

The tool may set out the two settlement estimates from figures the lawyer has already adopted, and it must not send the letter after the client has signed or invent a contribution from another party.

**AI may:**

- Place the lawyer's two adopted figures into the estimates and keep the assumptions beside them
- Name the statute the lawyer has selected and take out the other
- Record the date and time the letter was given, which must be before the client signs the settlement

**AI must not:**

- Must not state an estimate the lawyer has not adopted
- Must not describe this letter as the deed of release or as the sanction application
- Must not insert a Medicare, Centrelink or refund figure that is not in a document on the file
- Must not backdate the letter to a time after the settlement was signed

**The lawyer checks:**

- The letter is given before the settlement is executed, and the file shows when the client received it
- Estimate A includes any legal costs of another party that the client is to pay, as the section requires
- Estimate B is a reasonable estimate of contributions likely to be received, or it says that none are likely and why
- In Victoria or New South Wales, if this practice was retained by another practice, the lawyer confirms whether section 177(2) means the other practice gives the disclosure
- In Queensland, the lawyer checks whether a regulation under section 312(2) changes who discloses where more than one practice acts. The regulation was not opened
- The client signs the acknowledgement on this letter before signing the settlement. Health and settlement figures stay in the firm's system

## Authorities

- [Legal Profession Uniform Law (NSW) s 177(1) (before the settlement is executed: a reasonable estimate of legal costs payable by the client if the matter settles, including another party's costs the client is to pay, and a reasonable estimate of contributions likely to be received from another party)](https://classic.austlii.edu.au/au/legis/nsw/consol_act/lpul333/s177.html)
- [Legal Profession Uniform Law (NSW) s 177(2) (a practice retained by another practice need not disclose if the other practice discloses before execution)](https://classic.austlii.edu.au/au/legis/nsw/consol_act/lpul333/s177.html)
- [Legal Profession Act 2007 (Qld) s 312(1) (the same two estimates, before the settlement is executed)](https://classic.austlii.edu.au/au/legis/qld/consol_act/lpa2007179/s312.html)
- [Legal Profession Act 2007 (Qld) s 312(2) (a regulation may provide for subsection (1) where more than one law practice acts)](https://classic.austlii.edu.au/au/legis/qld/consol_act/lpa2007179/s312.html)

## Full text and drafting notes

The full text and the drafting notes are not part of this public page. Signed-in firm accounts can read them at https://ailawframework.com/precedents/costs-billing-and-litigation-funding/settlement-costs-disclosure and through the signed-in MCP connector https://ailawframework.com/mcp/firm.

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