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Proportionality and Cost Escalation

Lessons from Hartnett TAS Hartnett Lawyers v Bell [2023] NSWCA 244

Published: 11 July 2024 | Reviewed: 15 February 2026
(2-minute read)

Overview

In Hartnett v Bell [2023] NSWCA 244, the New South Wales Court of Appeal examined a costs dispute arising from enforcement of a $30,000 mortgage.

Over time, legal fees approached approximately $300,000.

The Court ultimately ordered repayment of over $250,000.

The decision is frequently cited in discussions of proportionality, uplift fees, and judicial oversight of legal costs.

Why the Case Matters

The matter began as enforcement of a relatively modest mortgage.
Over several years, invoices accumulated, including a 25% uplift fee.

The Court considered:

  • the proportionality of the fees relative to the underlying debt

  • whether the work performed justified the scale of billing

  • the appropriateness of the uplift

  • the adequacy of disclosure and itemisation

The Court concluded that substantial sums were excessive and ordered repayment.

The Structural Insight

The decision does not condemn litigation practice generally.

It illustrates a broader reality:

Where one practitioner controls:

  • strategy

  • scope

  • timing

  • billing

cost visibility may weaken over time.

Escalation is rarely dramatic.
It often develops incrementally.

The Court’s intervention occurred years later, after substantial costs had already been incurred.

Proportionality in Practice

The case reinforces enduring principles:

  • Legal costs must remain proportionate to the dispute.

  • Uplift arrangements require careful scrutiny.

  • Disclosure obligations matter.

  • Courts retain supervisory authority over excessive charging.

However, judicial correction is retrospective.

It occurs after drift has already taken place.

A Broader Lesson

Most legal matters are not complex at the outset.
Yet complexity can develop.

The decision demonstrates:

  • how estimates may evolve

  • how disputes over itemisation can arise

  • how difficult it can be for clients to assess necessity mid-matter

The structural question becomes:

What mechanisms exist to maintain visibility before escalation occurs?

For Readers Interested in Structural Safeguards

Clean Law publishes several explanatory resources on:

These materials are available in the “How the Model Works” section.

By Nicky Wang
Principal Solicitor
Legal Liaison Ltd (trading as Clean Law)

Prepared in accordance with public-interest governance, annual Law Society trust-account audits, and ACNC-reported standards.

Disclaimer: General information only. Not legal advice.