The National Tax Tribunal has ruled in favour of Bachmann/Partners Law Firm in a case concerning cost reimbursement. The case concerned a demand for repayment of reimbursed costs in a matter that the Ministry of Taxation had brought before the courts.
The case concerned an underlying matter that the Ministry of Taxation had brought before the courts, which had been referred to the Western High Court. The attorney handling the case for the client had informed the client in their agreement that the client did not need to pay the issued invoices, but only had to sign the reimbursement forms. The Danish Tax Agency interpreted this to mean that the client was not liable for the attorney’s fees, which would otherwise be covered under the rules on full reimbursement.
The National Tax Tribunal found that the attorney’s wording could only be regarded as an attempt to meet the general duty to inform under the ethical rules for attorneys. The attorney had not waived the right to charge fees in the agreement with the client, and therefore, in the Tribunal’s view, the expenses were eligible for reimbursement and the Danish Tax Agency was obliged to reimburse them fully.
Despite the favourable outcome before the National Tax Tribunal on this point, it is advisable in engagement letters and similar documents to emphasize that the client remains fully liable for payment, even if reimbursement may be sought.
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