Rates
There are no fixed rates in the legal profession. There are no price agreements and, as a result, the cost of legal assistance in Aruba may differ widely. How much an attorney at law will set you back as a client will depend on a number of things. Very much depends, for example, on the extent and complexity of your legal problem, as well as on the financial interest, the urgency, and the expertise and experience of the attorney at law in question. It is useful to make agreements with your attorney at law about the cost of your case in advance, to determine who will get to keep the legal costs, if awarded, and to put these agreements down in writing. To the extent possible, your attorney at law will give you an estimate of the total cost at an early stage and inform you on the financial consequences of handling your case.
It is customary for an attorney at law to notify his client well in advance of any new developments in the case that may lead to extra work, which, after all, may affect the total cost.
A bill is usually composed of the attorney fee, out-of-pocket expenses, and sales tax (BBO). The attorney fee is the amount charged by the attorney at law as reward for his work. The attorney fee includes overheads such as staff costs and office expenses. As a rule, your attorney at law will charge a fixed percentage or a fixed amount for office expenses.
Out-of-pocket expenses are expenses made by the attorney at law in connection with the case, such as court registry fees, bailiff fees, travel and accommodation expenses, docket fees, and stamp duties. Out-of-pocket expenses are divided into expenses that are subject to sales tax (BBO) and expenses that are untaxed. The main untaxed expenses are court registry fees (administrative charges that must be paid to the court clerk for the legal proceedings) and certain bailiff fees. Sales tax (BBO) is always due on the attorney fee. Attorneys at law have different ways of billing.
If you win a case, the other party is normally ordered to reimburse you for any legal fees you have paid in connection with the case; this is the so-called cost award. The awarded costs will include any court registry fees and stamp duties you have paid, bailiff fees, expenses related to any conservatory attachments levied, and, finally, the attorney fee. All these costs will, in principle, be included in their entirety in the cost award, except for the attorney fee, which is awarded as compensation for (read: contribution towards) the attorney fees you have paid. However, the amount of attorney fees awarded by the court is based on a so-called liquidation rate, which is substantially lower than the rates currently applied by attorneys at law. As a rule, this will mean that the fee you actually have to pay your attorney at law is not completely covered in case of a cost award, and that you will therefore have to pay part of this fee yourself, even if you win your case.
Attorneys at law have different ways of billing
Hourly rate
This is the system most commonly used. The number of hours an attorney at law spends on a case is multiplied by his hourly rate. A law firm may apply a fixed hourly rate or use different hourly rates for each type of attorney at law, depending on the attorney at law’s experience. The hourly rate may further depend on factors like urgency, the expertise required for the case, and the nature and interest of the case. When setting the hourly rate, it is also possible to take into account the client’s financial capacity, or even the result: a lower rate may be charged if the goal is not achieved while a higher rate will apply if it is. The hourly rates of the different law firms in Aruba are, on average, between 250 and 600 florins per hour. Smaller law firms, with one or two attorneys at law, often apply hourly rates that are somewhat lower than those of larger law firms with more attorneys at law. Among other reasons, this is because a small firm will, in principle, have lower overheads. Larger firms, on the other hand, may have people with more expertise who will need to spend fewer hours on a case.
Fixed amount
The attorney at law and the client agree in advance on a single total amount for the entire legal assistance.
Annual contract/framework agreement
In this case the client, often an entrepreneur, makes agreements with the attorney at law about bills to be issued in cases to be handled. Such agreements may include rates and possible factors based on experiences gained from previous cases. Special factors may also be considered here, such as urgency, expert knowledge, or the interest and nature of the case.
Collection rate
Cases that are about collecting debts are called collection cases. Particularly when several different collection cases are handled simultaneously by the same attorney at law, it is customary to apply the collection rate, which will usually be a percentage of the debt to be collected.
No cure, no pay
This means that the client will not pay any attorney fees, but that the fees will consist of a percentage of whatever is gained from the case. If the case is lost, the attorney at law will receive nothing. In some countries, like the Netherlands, this system is not allowed, because it gives the attorney at law a personal financial interest in winning the case, which may jeopardize his necessary independence. In Aruba, however, this system is allowed.
A combination of the above methods is also possible. In such case, the client may agree in advance with the attorney at law on a fee that is equal to a percentage of the claim, comparable to the collection rate, though not, for example, based on “no cure, no pay”, but with a minimum (fixed) bottom amount or an adjusted hourly rate. This method is sometimes used in cases in which compensation is claimed for bodily injury and/or immaterial damage.
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