(1)  A costs agreement may be made –

(a) between a client and a law practice retained by the client; or

(b) between a client and a law practice retained on behalf of the client by another law practice; or

(c) between a law practice and another law practice that retained that law practice on behalf of a client; or

(d) between a law practice and an associated third party payer.

(2)  A costs agreement must be written or evidenced in writing.

(3)  A costs agreement may consist of a written offer in accordance with subsection (4) that is accepted in writing or by other conduct.

Note. Acceptance by other conduct is not permitted for conditional costs agreements – see section 307(3)(c)(i) .

(4)  The offer must clearly state –

(a) that it is an offer to enter a costs agreement; and

(b) that the offer can be accepted in writing or by other conduct; and

(c) the type of conduct that will constitute acceptance.

(5)  Except as provided by section 338 (Contracting out of Division by sophisticated clients), a costs agreement cannot provide that the legal costs to which it relates are not subject to costs assessment under Division 7 .

Note. If it attempts to do so, the costs agreement will be void – see section 311(1) .

(6)  A reference in section 312 (Setting aside costs agreements) and in any prescribed provisions of this Part to a client is, in relation to a costs agreement that is entered into between a law practice and an associated third party payer as referred to in subsection (1)(d) and to which a client of the law practice is not a party, a reference to the associated third party payer.