In a comment on 6 December 2024, lawyer Jens Christian Riege makes a heartfelt complaint about what he describes as “attempts to avoid the limitation on legal costs in conciliation” – particularly in consumer disputes.
However, lawyer Riege does not mention the opportunities that exist here to safeguard consumers’ interests.
The practice
The practice described as an oddity by lawyer Riege is that in cases before the conciliation board “in addition to claims under section 6-13 of the Code of Civil Procedure, compensation is also claimed (often without further justification or specification) for legal fees before the conciliation board proceedings”. It is natural to understand Mr Riege as saying that this is something professional parties do, but not consumers. In my view, it is more natural to describe this as an opportunity for consumers, which professional parties often do not have.
Assistance prior to litigation
The Norwegian Disputes Act has rules on legal costs that basically contain an exhaustive regulation of what can be claimed as legal costs. At the same time, a breach of contract will usually give the party exposed to the breach of contract the right to claim compensation for costs incurred as a result of the breach. One possible item of compensation could then be expenses for legal assistance.
The distinction between legal costs regulated by the Dispute Act and claims for damages based on general principles of contract law and/or consumer law is not always clear. In Tore Schei et al. “Tvisteloven” (The Disputes Act), the latest electronic version of the comments to section 20-5 includes the following in note 3.2:
“There is a somewhat unclear interface between the procedural rules on legal costs and the substantive rules on compensation for the costs of legal assistance, cf. Rt-2000-441 on page 450… There is reason to believe that the grounds for liability have an overlapping field in a period prior to the summons. …
Procedurally, claims for coverage of costs for legal or other expert assistance based on tort law or procedural law must be regarded as different claims. There can be nothing to prevent the injured party, insofar as the grounds overlap, from claiming damages primarily on the substantive law basis, alternatively pursuant to Chapter 20 of the Dispute Act. However, the court must expressly take a stand on the basis even if the claim is successful.”
What can and should be done?
In the examples mentioned by Attorney Riege, it is the professional party that is claiming reimbursement of legal costs in excess of the limitations for legal costs. Such a claim must be based on the rules of tort law, as the rules of the Dispute Act do not provide a basis for coverage. However, the circumstance that a consumer has, for example, made a complaint prior to the proceedings in the conciliation council does not constitute a breach of contract towards the professional. The professional then has no basis for claiming compensation under the general rules of the law of damages and/or relevant legislation because the requirement for a basis for liability will not be met.
The consumer, on the other hand, has presumably received a defective and/or delayed product or service. Thus, the basic condition for being able to claim compensation from the professional party will in principle be met. At the same time, a consumer who makes a complaint will hope that this will resolve the matter. Thus, it will not be natural to count expenses for a lawyer in an initial phase as a legal cost, but instead as a loss item that can be claimed as caused by the professional’s breach of contract. In any case, you will be in the overlapping field where claims for reimbursement of legal expenses can be based on two different sets of rules.
In other words, consumers have a good legal basis for objecting to this type of claim made by professional counterparties, because the requirement for a basis for liability will not be met. At the same time, consumers often have grounds for claiming reimbursement of their actual legal expenses under general tort law rules, even if they are higher than the limitations that follow from the Dispute Act’s provisions on legal costs. If both of these grounds are actively used, it is not a given that it is consumer lawyers who should be most dissatisfied with the current legal situation.
This article was first published on rett24.no.