If a Queenslander suffers an injury, they are entitled to pursue a compensation claim with no upfront costs. There are also laws which limit how much your lawyer can take from your payout.
Many people avoid claiming the compensation they're entitled to because they worry about the legal costs involved, but understanding how these fees actually work removes that barrier and helps you make an informed decision.
This handy guide will discuss everything you need to know about professional legal fees, disbursements, statutory refunds, the 50/50 rule and how No Win, No Fee works in practice.
Understanding Legal Fees, Disbursements and Statutory Refunds
What are the three types of costs in a Queensland compensation claim?
These three categories are all distinct, and getting them mixed up is a common mistake.
1. Professional Legal Fees. These are fees charged by your lawyer for their time and legal work. When it comes to Queensland personal injury claims, lawyers cannot charge a percentage of your settlement, so fees must be calculated on an itemised or time-based basis and include GST. The 50/50 rule caps these fees at no more than 50% of your net damages.
2. Disbursements. These encompass all out-of-pocket expenses paid to third parties in the process of building your case. Common examples include:
- Medical reports and IME assessments
- Barrister fees (if your case goes to court)
- Court filing fees (e.g., Statement of Claim)
- Expert witnesses (engineers, vocational assessors, etc.)
Disbursements are deducted from your settlement before the 50/50 rule is applied, and are not capped by the rule.
3. Statutory Refunds. If you were in receipt of government-funded benefits while injured, they must be repaid from your settlement. These refunds are also deducted before the 50/50 calculation. Examples include:
- Medicare: repayment of all treatment costs covered during your claim
- Centrelink: repayment of any income support received
- WorkCover Queensland: repayment of statutory benefits paid as part of a work injury claim
How the 50/50 Rule Works
What exactly is the 50/50 rule?
The 50/50 rule is a client protection which falls under section 347 of the Legal Profession Act 2007 (Qld). It is a cap on your lawyer's professional fees so that you always receive at least 50% of the net damages you are awarded.
The formula is:
Maximum Fees = (Gross Settlement − Statutory Refunds − Disbursements) ÷ 2
The result is your "net damages." Keep in mind that your lawyer's fees can never exceed half of that figure.
It could turn out that your lawyer's actual fees are actually lower than the cap. In a scenario such as this, Smith's Lawyers actual fees would be closer to $30,000 based on the work we’d normally perform, leaving you with approximately $50,000 (62.5% of the gross settlement).
The 50/50 rule does not apply to disbursements or statutory refunds, only to professional fees.
Your Rights and Entitlements
What you're entitled to:
- A written costs agreement before your lawyer begins working on your case. You have the right to be given the opportunity to read and fully understand it before signing
- Updated cost estimates if projected costs change by more than 10%
- A costs assessment if you dispute your final bill. If this happens, you have up to 12 months post-settlement to challenge fees through QCAT (for disputes under $25,000) or the courts
What you must do:
- Lodge your claim within 3 years of the injury date under the Limitation of Actions Act 1974 (Qld), don't wait
- Provide a Notice of Claim before commencing legal proceedings under the Personal Injuries Proceedings Act 2002 (Qld)
Key deadlines:
- 3 years from injury: this is the limitation period for most personal injury claims
- 2–6 years from disablement: this is the typical TPD claim window under superannuation policy terms
- 60 days after a failed compulsory conference: this is the deadline to file a Statement of Claim in court
Common Questions and Scenarios
Do I pay anything upfront?
Quick answer: Not under a genuine No Win, No Fee arrangement. You shouldn’t have to pay anything to start your claim under these circumstances.
Smith's Lawyers will fund all professional fees and disbursements throughout your claims process, and we will only recover costs (from the settlement proceeds) if your claim succeeds.
Can I see the costs agreement before I sign?
Quick answer: you can, and you should always insist on this.
Queensland law requires that your lawyer provides a costs disclosure document and written costs agreement before they begin working on your case. Ensure you read it carefully and ask questions about anything you don’t understand. Under no circumstances should you sign anything you don't understand.
What happens if my claim loses? Who pays the disbursements?
Quick answer: this will largely depend on the policy of the law firm you’re working with. It's a critical question to ask before engaging with anyone.
- Smith's Lawyers policy: in the event your claim is unsuccessful, Smith's Lawyers absorbs all disbursements and you will owe nothing.
Some other firms require their clients to repay disbursements even if the claim fails, which can leave you thousands of dollars out of pocket.
Always confirm your firm's policy on disbursements in a loss scenario before signing a costs agreement.
What if the other side is awarded costs against me?
Quick answer: it is possible for this to happen if your claim goes to trial and is unsuccessful, but it’s quite rare.
If a court decides in favour of the defendant, you may be liable for their legal costs. Most defendants in personal injury claims are typically insured (WorkCover, CTP insurers, public liability insurers), so their legal costs are covered by the insurer.
Your lawyer will advise you on the risk of this happening before proceeding to trial.
How does No Win, No Fee compare to other fee arrangements?
Step-by-Step: How Costs Flow Through Your Claim
- Free initial assessment: No cost, no obligation. Your lawyer will confirm if you have a viable claim before asking you to sign an agreement.
- Sign a costs agreement. Reviewed and signed before any work begins. This sets out how fees are calculated and what happens in the event your claim is unsuccessful.
- Disbursements funded by the firm. Smith's Lawyers will pay for all medical reports, experts and filing fees throughout your claim.
- Settlement negotiated. Statutory refunds, disbursements and legal fees are calculated and deducted from the gross settlement.
- 50/50 rule applied. Your lawyer's fees are capped at 50% of net damages, with the remaining balance paid out to you.
- You receive your payment. The remainder is transferred to you, typically within a few weeks of settlement.
Documents you'll need:
- Medical records and treatment invoices. These will be used to establish the nature and extent of your injuries, and can be gathered from all your treating practitioners.
- Evidence of lost income. Payslips, tax returns and employer statements. These are used to calculate your economic losses stemming from the injury.
- Incident reports or police reports. This will confirm the circumstances of your injury. You should request copies as early as possible because they may be harder to obtain later.
Legal Framework
- Primary legislation: the Legal Profession Act 2007 (Qld), s 347 sets the 50/50 cap on professional fees in personal injury claims
- What this means for you:
- Your lawyer cannot take more than half of your net compensation in fees
- Costs agreements are mandatory, and you can dispute your bill within 12 months of settlement if you’re unhappy
Red Flags and Warning Signs
You should act immediately if:
- A firm asks you to pay upfront fees or disbursements before your claim is assessed
- You're pressured to sign a costs agreement without being given time to properly read it
- The firm you’re speaking to cannot clearly explain what happens to disbursements if your claim fails
Common mistakes to avoid:
- Waiting too long to get advice: the 3-year limitation period can expire before you realise it
- Not reading the costs agreement: some firms charge disbursements back to clients if their claim isn’t successful, and this should be explicitly addressed before you sign
When to Seek Legal Advice
It’s always a good idea to seek legal advice as early as possible, especially if:
- You've been injured in a workplace accident, motor vehicle crash or public place incident in Queensland
- You're receiving WorkCover statutory benefits and want to know if you can make a common law claim
- You're unsure whether you have a viable claim or how long you have to act
Early advice is crucial because it allows you to:
- Understand your full rights and entitlements before time limits expire
- Access rehabilitation and support services sooner
- Protect your claim from common pitfalls like missing notice requirements
- Get expert guidance on whether a common law claim is worth pursuing alongside your statutory benefits
Key Takeaways
- Three separate deductions come out of your settlement: statutory refunds, disbursements and legal fees
- The 50/50 rule guarantees you at least half of your net damages
- No Win, No Fee means no upfront costs. At Smith's Lawyers, you will not be liable for disbursements if your claim is unsuccessful
- Always read your costs agreement before signing, and confirm what happens if your claim fails
- Time limits apply, and most Queensland personal injury claims must be commenced within 3 years of the injury date
Get Help Now
If you've suffered an injury and believe another party may be at fault, getting early legal advice helps you understand your rights, access the rehabilitation you need and protect your entitlements to compensation.
Smith's Lawyers operate on a No Win, No Fee, No Catch® basis, with no upfront costs, no disbursement liability if your claim is unsuccessful and full transparency on fees before you commit.
Contact Smith's Lawyers today:
- Call: 1800 960 482 for a free, no-obligation consultation
- No upfront costs: No Win, No Fee, No Catch®, fees only apply if your claim succeeds
Or request a call back: use the form below to have our team contact you at a time that suits you
