The Law Society of New Brunswick says there is isolated evidence that attorneys in the province are dismissing worthy cases due to the current contingent fee limit.
If attorneys accept contingency fee agreements, they are paid when the matter is resolved, either through a settlement or a court judgment.
Since 1997, New Brunswick legislation has limited these fees to 25 percent of the amount collected.
Moncton’s attorney Darren Blois chairs the committee that has been asked to look into how the agreements have worked and whether the rules need to be changed.
“The legal society became aware of this, particularly from attorneys who work in the medical practice,” said Blois.
Malpractice cases are expensive to perform and often highly competitive, Blois said. Experts have to be hired, there are a lot of upfront costs, and there is seldom a quick fix.
“And lawyers find that they can only approach such cases economically if they are very large or very simple – not with a contingency of 25 percent.”
Blois said the cap is also an issue in cases of minor motor vehicle accidents where the injured person may only view damage as high as $ 10,000.
“25 percent of that would be $ 2,500,” said Blois. “Which was not economical for many lawyers.”
Lawyers can apply for a higher contingent fee
Basil Alexander, associate professor of law at the University of New Brunswick, reviewed the committee’s report and found that attorneys can apply to an examining officer for a higher fee.
The report does not specify how often this happens, but 80 percent of these requests are for malpractice cases.
It also states that all but one of the applications have been approved and date back to 2012.
“So my question is this,” said Alexander. “If lawyers don’t have to go through this process, especially since it almost always seems to be yes, will it result in more people hearing their cases?”
He thinks it will be interesting to see if people will join the invitation to respond to the legal society in writing or by attending a video conference on March 25th.
He says lawyers take risks by accepting contingency fee agreements and clients benefit from knowing they’ll only pay at the end and know the percentage of what they’ll pay up front.
But he says the problems are complicated and potentially difficult to understand.
It would be informative to hear from attorneys who wished they could have taken cases but decided they couldn’t accept the risk.
The bar association says that privilege forces lawyers to say too much.
Prohibitions on contingent fees in criminal law and family law remain in place
The new rules do not change the existing ban on agreements on contingent fees.
They are not permitted in family or criminal cases.
Osgoode law professor Trevor Farrow says there are reasons for this.
“When it comes to cases involving children’s rights, the location of cohabitation arrangements, custody and access, money isn’t always at stake, which makes it harder to decide what percentage of the Profitable, “he said.
“Not to mention the somewhat awkward notion of a business model that assumes someone wins child custody or custody related to a close relationship with domestic violence. All of these are viewed as a different type of case.”
Trevor Farrow is a law professor at the University of Toronto’s Osgoode Hall Law School and chair of the Canadian Civil Justice Forum. (Martin Trainor / CBC)
As chairman of the Canadian Civil Justice Forum, Farrow says access to justice is increasingly an issue.
He says that most people have a legal problem in their life and many are financially unprepared.
“About 80 percent use other resources,” said Farrow. “Like the internet, a friend or family, like a trusted intermediary, a religious advisor, or something like a community worker.
“About 80 percent of people with legal problems have access to some other type of help than lawyers.
“And the main reason people deal with their own legal matters that they cite is usually cost,” he said.
“It’s just very expensive to get legal aid,” Farrow said.
The Law Society of New Brunswick says it has a role in protecting the public interest and wants to hear from the public whether they think the changes are a good idea or a bad idea.
“We want to give people the opportunity to represent whatever type of representation they want to do before we make a decision on whether to go through these reforms.”
Blois invites people to learn more about the rules on the Bar Association’s website. The public can also register there to take part in the discussion on Thursday.
The one-hour session in English starts at 6:30 p.m. and the French session starts at 8:00 p.m.