Did you know the maximum per hearing fee permitted by SC is Rs 8000?

Late MC Setalvad is remembered as a stalwart advocate not only for his legal acumen but for his scrupulously adhering to the limit set by the Supreme Court Rules as well. Yes, the maximum he charged in his lifetime per hearing was Rs 1600. Ditto for the labor law giant M. K. Ramamurthy who in addition never appeared for managements. He took a principled stand---he couldn’t rant against the same management from which he had taken fees the next time he appeared for the labor. He preferred therefore to represent labor throughout his career.

Today top-notch advocates charge anything between Rs 10 lakh to Rs 1 crore and more per hearing, with Harish Salve proudly declaring in a Times Now show more than a year ago that he was the country’s highest charging advocate. Late Justice VR Krishna Iyer called Rs 25000 per hearing in those days as fancy. His head might squirm and spin uncomfortably in his grave if told about the current rate.

Representational image. AFP

Representational image. AFP

The Supreme Court Rules 2013 permit a maximum of Rs 8000 per hearing. Obviously the rule is practiced more in breach than in compliance. It is perhaps meant for those litigants who cannot afford top lawyers and settle for the ones available under the SC legal aid scheme. Why the indigent, not even the modestly rich can afford such mind boggling fees unless the stakes are very high.

Most of the clients who can afford are corporates with deep pockets. The Attorney General Mukul Rohatgi, himself a successful corporate lawyer till he suspended his ample private practice, is reportedly peeved by the dilatory tactics adopted by the legal eagles and prevailed upon the Apex Court to impose heavy fines on companies doing so and also those pursuing vexatious litigations. The result is the Supreme Court recently slapped a hefty penalty of Rs 50 lakh on a slew of companies including Star India and followed it up with Rs 25 lakh on another bunch of errant companies. The logic is if you can afford fancy fees to lawyers, you might as well cough up for legal aid. Fair enough.

But then how to rein in the lawyer fees? Should Parliament legislate on it? If it does, there would a howl of protest. Drug prices can be controlled but not professional fees would be the smug refrain. Can the super cine stars and IPL cricketers be asked to accept a government fixed fee? No way.

The market forces however can be depended upon to rein in the lawyer greed, as it were. In the USA, lawyers invariably take a percentage of the award amount in property suits and compensation claims. The Indian law prohibits both chartered accountants and lawyers from taking commission based remuneration. While that is in order for CAs who otherwise would see virtue in jacking up profits through clever if sharp accounting practices, there is no reason why lawyers should be so hamstrung.

In fact the law should actively encourage result oriented remuneration for lawyers. First, there is an incentive to work hard for the client. If you lose due to bad advocacy or facts being stacked up against you or both, you get nothing. Stella, the 79 year old woman whose thighs were scalded by piping hot McDonald coffee got whopping US $ 2.86 million compensation only because the sufficiently incentivized lawyers worked hard for it. There is nothing wrong or immoral in a tax lawyer taking Rs 10 lakh fee after he wins an Rs 1 crore tax refund claim.

It has indeed got everything going for it. Time taken would be less because the lawyers would not take adjournments at the drop of the hat. Per hearing fee makes them smug and infuses an element of self-interest in dragging on the case. What is more, even relatively less rich people can afford the services of quality, top-notch lawyers because the question of fees would arise only on winning the suit.

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Updated Date: May 12, 2016 17:00:45 IST

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