Lawyer's Fees

Methods of calculation

A lawyer may freely agree his fee with a client. The fee must be calculated in accordance with the manner and extent of effort, with the difficulty of the case, and with the amount in dispute (interest in the case). The lawyer must not demand the amount or object in dispute as a fee, neither as a whole nor in part, nor may he have that amount or object assigned or pledged to himself.

The Act on Tariffs for Lawyers and Legal Agents (Gesetz über den Tarif für Rechtsanwälte und Rechtsagenten) and the Fee Guidelines of the Liechtenstein Chamber of Lawyers (Honorarrichtlinien der Liechtensteinischen Rechtsanwaltskammer) provide information on the adequacy of a lawyer's fee.

Normally, a lawyer's fee is calculated pursuant to the lawyer's tariff laid down in the law. That tariff permits various methods of calculation.

For drawing up contracts, it is usual to agree on a percentage of the amount in dispute / the interest in the case (e.g. the purchase price, the value of a piece of real estate, etc.) as the fee.

In cases in which no sum can be put on the interest or amount in dispute, it is also possible to agree on an hourly fee. The hourly rate is variable and depends on the circumstances of the individual case.

Lawyers are not permitted to agree on a contingency fee.

Criteria for calculation

The amount of a fee is calculated by a number of criteria:

• amount in dispute or value of interest if the matter is not contentious
• time spent
• complexity of the matter

Out-of-pocket expenses and costs incurred (such as Xerox copies, postage, telephone and fax costs, cost of secretary depending on time spent, etc.) are added to the fee.

Calculation of fee towards the court

Liechtenstein procedural law provides for the refunding of costs in relation to the degree of success. This means that the party who loses a lawsuit must refund the other party's legal costs in relation to the percentage the lawsuit has been lost.

When awarding costs, the court uses the Lawyer's Tariff for calculation. That Tariff includes various tariff items (Tarifposten, TP) broken down by the amount in dispute. A so-called Standard Rate (Einheitssatz) of 40 % or 50 % is then added, which covers ancillary services such as talks with the client, telephone calls, correspondence, study of files and legal material etc. as a lump sum. The fee for briefs and hearings is calculated on the basis of the applicable tariff items plus the standard rate. This is the way the court determines what legal costs must be refunded.

Calculation of fee towards the client

In a lawsuit, a lawyer will frequently calculate the same fee to his client as to the opponent. However, he may charge his individual services instead of the mentioned lump-sum standard rate. There are separate tariff items for talks, telephone calls, letters, etc. Therefore, the fee charged to a client may be substantially higher than that awarded to the prevailing party by the court. It is therefore possible that a client has to pay an additional fee to his lawyer even though the lawsuit has been won.

If a lawyer calculates his fee by individual services, the reason for this is in most cases that the activities of the lawyer before the proceedings or out of court have been considerable, and that the standard rate would not offer sufficient compensation for the amount of work done.

Advance on costs and fee agreement

It is common in the legal profession to ask for an advance on costs from clients for the preliminary coverage of fees and out-of-pocket expenses. With long-term mandates, most lawyers will make a monthly account so that client and lawyer can keep an eye on the development of costs.

In any event, the question of the fee should be clarified when the mandate begins, and a fee should be agreed upon in order to avoid later conflict.

Opinion on a fee

If there is a dispute on the adequacy of a lawyer's fee, the Board of the Chamber of Lawyers may provide an expert's opinion if both parties (lawyer and client) ask for such an opinion. Adequate compensation must be paid for providing that opinion, which compensation will be calculated by the Board in accordance with the Fee Guidelines.