In recent weeks, the issue of contingency fee agreements in family law has received media attention. Ontario is presently the only jurisdiction in Canada that prohibits contingency fee agreements in family law cases. A few weeks ago, a group of 11 GTA family lawyers wrote a letter petitioning the provincial government to legalize contingency fees in family law matters.
A contingency fee is a fee charged for a lawyer’s services only if the lawsuit is successful or settled in the client’s favour outside of court. Contingency fees are usually calculated as a percentage of a client’s settlement amount. If the lawsuit is not successful or does not settle in the client’s favour, the client does not have to pay for the lawyer’s services. Contingency fee agreements are also prohibited in criminal law, but are common in personal injury or class action lawsuits. The most common alternative to a contingency fee is an hourly rate, whereby a client pays for the time the lawyer spends working on the case. The set fee approach is another alternative, which involves paying a flat rate for a specific legal service.
One of the strongest arguments in support of contingency fees is that it allows people to pursue their civil rights regardless of their socio-economic status. Hiring a lawyer is expensive, and can be unaffordable for the average person. In a contingency fee arrangement, a person interested in commencing a lawsuit does not need to pay money upfront to a lawyer, and the risk of the lawsuit and potential trial is borne by the lawyer or law firm.
In their letter to the provincial government, the GTA family lawyers stated that the prohibition forces many people, mostly women, to represent themselves in family cases. Women are often stay-at-home mothers whose husbands control the family finances and may not have an independent source of income to be able to afford to hire a lawyer. The letter states that the billable hour method “exacerbates the feminization of poverty. … Despite improvements made to our legislation over the past decades, women continue to be more likely to suffer the adverse economic consequences of marriage breakdown.”
But while some lawyers think that allowing contingency fee agreements would increase access to justice, others think legalization would lead to ethical and practical problems. Contingency fee arrangements are often referred to as “no win no fee”, but in family law it is often difficult to determine who “wins”. In addition, some family cases do not involve finances at all, adding further complications to the determination of winners and losers.
Among the ethical considerations raised is that the funds involved in a family dispute are the family resources. Critics contend that contingency fee arrangements would take money away from the children or spouses who are depending on it.
One thing that remains clear, is that the number of unrepresented litigants in family court is problematic. Court procedures and documents can be complex and overwhelming to the average person, and self-represented litigants are at a huge disadvantage when facing experienced counsel. Change is imperative, and increased access to justice should be a priority in family law cases.
For more information and to speak to an experienced family lawyer, contact Jason P. Howie online or at 519.973.1500.