10.18: Reference to Court
10.7: Contingency fee agreement requirements
10.8: Lawyer’s non-compliance with contingency fee agreement
11.27: Validating service

Case Summary

An Assessment Officer referred a dispute about the interpretation, enforceability and application of a Contingency Fee Agreement to the Court pursuant to Rule 10.18. The Plaintiff, Niam, contended that the Defendant lawyer, Silverberg, could not collect fees under the contingency agreement because the requirements of the Rules of Court applicable to contingency fee agreements had not been satisfied. The Plaintiff argued that Rule 10.8 was applicable. The Rule provides that, when a lawyer does not comply with the contingency fee agreement requirements, the lawyer is only entitled to his or her fees under Rule 10.2, as if there was no contingency fee agreement.

The Plaintiff also argued that the contingency fee agreement contravened Rule 10.7(2)(d), claiming that the particulars in the agreement were not precise and understandable with respect to the event which would trigger payment of the lawyer’s fees. Brooker J. held that there was a clear contingent event which had occurred, and the contingent event had been precisely and understandably described in the contingency fee agreement in accordance with Rule 10.7(2)(d). Brooker J. also determined that, unlike most situations in which a client enters into a contingency fee agreement, the Plaintiff was represented by her own independent legal counsel at the time of the drafting of the agreement.

The Plaintiff also asserted that the Defendant had not served the agreement in strict accordance with Rule 10.7(4), which provides that a signed copy of the agreement must be served on the client within 10 days after the agreement was executed. The Defendant acknowledged that a signed copy of the Agreement was never formally served on the Plaintiff. However, the Plaintiff executed the agreement in the presence of a Notary Public and then emailed a copy of the executed document back to the Defendant. Brooker J. reviewed the authorities provided by both parties and concluded that only in rare circumstances will the Rules surrounding contingency fee agreements be relaxed. Brooker J. also found no indication that the Plaintiff was vulnerable or that there was a power imbalance between the Plaintiff and Defendant at the time the contingency fee agreement was executed. Justice Brooker noted that Rules surrounding the “cooling off period”; 10.7(2)(g) and 10.7(5), which allow a client to terminate a contingency fee agreement within five days of the executed agreement having been served on them, could be relaxed in this case, as the “cooling off period” could be easily determined from the date that the Plaintiff executed the Agreement in front of a Notary Public.

Given the exceptional circumstances, Brooker J. found that the contingency fee agreement was in compliance with the Rules. His Lordship also granted the Defendant’s Application to validate service of the Agreement on the Plaintiff pursuant to Rule 11.27. Justice Brooker held the Agreement enforceable and referred the dispute respecting the amount payable under the agreement back to the Assessment Officer.

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