In June 2000 Convocation of the Law Society of Upper Canada approved a report recommending contingency fees for all litigation matters, except criminal and family law. A joint committee of the Law Society, the Canadian Bar Association and the Advocates’ Society prepared the report in consultation with the Ministry of the Attorney General.
Previously, contingency fees were only permitted in class actions in Ontario.
In March 2001 the Superior Court permitted a lawsuit that was not a class action, to proceed pursuant to a proposed contingency fee agreement with legal counsel. Following a Court of Appeal decision in this same case in the fall of 2002, the Law Society of Upper Canada approved a rule that permits lawyers to enter into contingency agreements with their clients.
Contingency fees help provide better access to justice as some clients who in the past could not afford to pursue certain claims may now be able to do so.
Contingency fee arrangements tie a lawyer’s fee to the outcome of a case.
If the client wins the case, the client pays his or her lawyer a percentage or other agreed upon portion of the settlement. If a client loses, the client doesn’t pay. The lawyer accepts the risk of not being paid when taking a case on a contingent basis.
In determining the percentage or amount of the contingency fees, the rule states that the lawyer and the client in each case should consider a number of factors, including the likelihood of success, the nature and complexity of a client’s claim, the expense and risk of pursuing it, and whether the lawyer or client is to receive an award of costs.
Contingency fees are regulated under the Solicitors Act, effective October 1, 2004. The regulation provides details as to the content of the Contingency Fee Agreement. Under the regulation it is the client who is entitled to receive the award of costs and who is also responsible for payment of disbursements to cover costs, such as expert witnesses, for example.
A contingency fee agreement may be arranged in suitable cases after we have had the opportunity to meet and review your case with you.