• Bill 213 amendments to Solicitors Act authorize LGIC to prescribe maximum percentage that can be charged as contingency fee, and allow courts to endorse fees above maximum.
• Lawyers have general duty to render fair and reasonable account. Any account rendered by a lawyer is subject to review by the court or an assessment officer through a standard assessment process.
• B.C. is only Canadian jurisdiction that sets maximum percentages for contingency fees: 33 1/3% for personal injury or wrongful death in motor vehicle accident cases and 40% for other personal injury or wrongful death cases.

Option 1: Set a maximum percentage

Pros:

• provides further control on fees in addition to the assessment process
• maximum may reassure public that lawyers will not take unfair amount of clients' awards
• fewer clients may seek review of contingency fee contracts, lessening the burden on court resources

Cons:

• inconsistent with approach in most other Canadian jurisdictions
• arbitrary number may have no rational connection to work done by lawyer
• maximum percentage likely to become the norm
• if maximum percentage is set below market rate, lawyers unlikely to take cases on contingency basis
• client already protected by existing assessment process and "reasonableness" standard
• may increase court workload if many lawyers apply to court for fee increases in complex or high risk cases
• in Raphael case, percentage agreement was 15% of first million and 10% of subsequent million; percentage well below any maximum percentage that might be set, yet resulting figure owing to lawyer is high

Option 2: Do not set a maximum percentage

Pros:

• permits broadest freedom of contract between lawyers and clients
• client protected by assessment process and "reasonableness" standard
• consistent with most Canadian jurisdictions
• court resources will not be needed to deal with applications by lawyers for fee increase at outset of complex or high risk cases

Cons:

• absence of maximum percentage may be seen by public as inadequate protection of clients
• without maximum percentage as guide, more clients may seek reviews by courts to determine whether their contracts are fair and reasonable

Recommendation

It is recommended that any regulation not set a maximum percentage. Instead, it is recommended that other safeguards be put in place to protect the client.

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