No shortcut for legal fees

By Harold Ayodo

Some investors in the lucrative real estate sub sector bargain with lawyers to charge lower fees for legal services. There are also people who buy homes running into millions of shillings but are reluctant to pay legal fees.

Consequently, the lawyer and client would end up in court as the advocate seeks orders to be paid the due professional fees.

For starters, avoiding services of a conveyancer (property lawyer) is impossible as they are the only ones mandated to oversee property transaction. Furthermore, purchasing land or a house entails a series of paper work that must be signed by a lawyer with a valid practising certificate.

Usually, property transactions involve two conveyancers — one acting for the seller and the other for the buyer. Unknown to some investors, the advantages of using a lawyer in the transactions far outweigh the disadvantages despite parting with legal fees. According to most clients who play hide and seek after getting legal services from lawyers, the learned friends charge ‘high’ fees and refuse to bargain. Most advocates would not bargain as under-cutting — charging lower fees is — illegal and amounts to professional misconduct.

Furthermore, the Advocates Act prescribes minimum legal fees that must be charged to clients per transaction. In daily practice, the cost of legal services is left to an agreement between the advocate and client following complexity of some transactions. Therefore, written agreements are the easiest way to avoid misunderstandings between the lawyer and investor.

Fee disputes

Most lawyers charge required fees as illegal or grossly excessive fees may attract the whip of the Advocates Disciplinary Committee (ADC). The Advocates Act also provides for written and invalid fee agreements and how disputes involving clients should be resolved. However, property transactions are not the same and there are factors that determine legal fees.

For instance, the amounts in proportion to the value of legal services performed as some transactions are too complex. The time and labour required and difficulty of a matter that would preclude other employment of the lawyer. Other factors may include fees customarily charged in the area for legal services of a comparable or similar nature.

According to the ADC representative David Majanja speaking at a Law Society of Kenya (LSK) last weekend in Nairobi, the experience of the lawyer is also a factor. Majanja who was addressing young advocates during an induction course said the reputation and ability of the lawyer also comes into play.

For instance, opening a file in a newly set up law firm would not cost the same with one that has been in practice for over 30 years. According to Majanja, time limitations either imposed by the client or circumstances of the representation have an effect.

Other factors could include the nature and length of the professional relationship with the client and the informed consent of the client.
The writer is an advocate of the High Court of Kenya.