I Think My Spouse Owes Me An Equalization Payment; Can I Pay My Legal Fees When I Get That Money?: Contingency Fees and Family Law

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Written by Colin A. Steffler

There are numerous law firms advertising on television, radio, internet, and elsewhere that claim, “our lawyers only get paid when you get paid” or “no fees unless we win”, or otherwise offer some arrangement where the lawyer’s fees are taken out of any settlement or court judgment obtained. These fees are referred to as “contingency fees”, since the amount payable to the lawyer is “contingent” (that is, it depends) on winning and, typically, also on the size of the settlement or judgment (since contingency fees are often a percentage of the amount recovered). At one time, lawyers were prohibited from charging contingency fees in any case. However, this has changed over time so that contingency fees are now permitted in most areas of law, and contingency fee agreements have, understandably, become the norm in certain legal contexts, particularly personal injury matters and class action lawsuits.

In many personal injury matters, the injured person’s ability to work has been partially or completely impaired by his or her injuries. As such, without a contingency fee arrangement, that person may lack the means to hire a lawyer to seek the compensation needed to pay for treatment or replace income lost as a result of injuries. Similarly, in class actions, where the claim often relates to small wrongs committed against numerous people, the potential costs of hiring a lawyer are likely to far outweigh the value of any one person’s claim. In these contexts, contingency fee agreements allow individuals to seek compensation where it would otherwise be impossible, or wildly impractical, to do so.

There are, however, some contexts in which contingency fees are still not allowed. Specifically, Rule 3.6-2 of the Rules of Professional Conduct, established by the Law Society of Ontario, prohibits lawyers from entering into contingency fee agreements in criminal, quasi-criminal, or family law matters.

The reason for maintaining the prohibition of contingency fees in criminal and family law matters is that the dynamics in these types of cases are significantly different from other types of litigation. As the defendant (i.e. the person charged with an offence) in a criminal law matter, “winning” may simply not be possible and pleading guilty to an offence may be better trying to fight the charges at the risk of being found guilty of a more serious crime. Moreover, “winning” for a defendant in criminal law means being found not guilty and avoiding a loss of freedom; so, on a practical level, there is no financial settlement or payout from which contingency fees could be paid.

Similarly, while there are financial aspects to family law, there is often more at stake than just money, and the other party is not some arm’s-length corporate entity, such an insurance company, but, usually, a former spouse, with whom you may still have to have some interaction for the rest of your life (if you have children). As such, contingency fees in the family law context could be counterproductive, since they would create an incentive to “win” at any cost. In turn, that desire to “win” may lead to increased (and potentially long-term) conflict between the parties and prevent them from entering into a reasonable and timely settlement. So, in short, the answer to the question in the title of this article is “no”.

You can read more about contingency fees and contingency fee agreements on the Law Society’s website by following the link below:

Other Options and Resources Available

Although contingency fee arrangements are not permitted in the family law context, it is entirely understandable that you may be concerned about the cost of hiring a lawyer and may be looking for ways to reduce those costs. If that is the case, there are a few ways you may be able to obtain legal advice and assistance at a reduced cost.

Limited-Scope Retainers

Given the high costs involved in family litigation, many law firms have begun offering unbundled services through “limited-scope retainers”. This type of retainer allows clients to reduce their costs by determining the specific steps or aspects of their case with which they want assistance. For example, you may wish to retain a lawyer on a limited-scope basis to assist you only with the preparation of court documents, or to attend court with you, as your agent, for a particular step in the litigation process, while you maintain control over all other aspects of your case.

Legal Aid

If you’re income is low, you may qualify for assistance through Legal Aid Ontario (“LAO”). If eligible, LAO will provide you with a Legal Aid “Certificate” and will typically provide you with a list of lawyers in your area who take on Legal Aid matters. The lawyer will then be paid through Legal Aid for the work they do on your matter. Depending on your financial circumstances, you may be required to re-pay LAO from any funds received in the resolution of your case. You can contact LAO at 1-800-668-8258 and can find more information about their eligibility criteria at the link below:

Family Law Information Centre

There are Family Law Information Centre (“FLIC”) offices at many courthouses throughout Ontario. If you are looking for assistance with a family law matter, and you don’t have a lawyer, you can meet with a lawyer at the FLIC. That lawyer can provide some legal advice, provide any court forms needed for the next step in your case (as well as some guidance on how to fill them out), and may be able to provide referrals to Legal Aid or other community resources. Hours of operation vary between FLIC offices, with some only being open on certain days of the week, and most operate on a first-come, first-served basis. As such, you may wish to contact your local FLIC office to find out when they are open prior to attending. You can find more information and a list of all of the FLIC offices in Ontario at the link below:

Duty Counsel

If you cannot afford to hire a lawyer, but do not qualify for Legal Aid, you can still speak with Duty Counsel on the day of any court appearance. Depending on your financial circumstances, Duty Counsel may be able to go into court with you, or may only be able to provide summary legal advice. Even if your income exceeds LAO’s financial eligibility criteria, you are still entitled to speak to Duty Counsel to get some advice about your case.

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