Six tips for avoiding legal fee assessments
By Paul Russell, AdvocateDaily.com Contributor
“Be careful who you take on as a client,” says Upenieks, partner with Lawrence, Lawrence, Stevenson LLP. “Listen to your instincts. If your gut is telling you not to take the client on, don’t.”
Upenieks says that lawyers who work outside the courts, such as solicitors who handle real estate or corporate law, may never have fee disputes, as it is more prevalent with litigators, especially with those who deal with family law and personal injury cases.
“In family law, each side can burn through a great deal of their financial resources during the trial, as so much hinges on ultimate success,” he says. “It’s a very emotional thing.”
Clients who feel they were overcharged for legal services can ask for a Solicitors Act assessment, a review unique to the legal profession, he says.
“This piece of legislation dates back more than 100 years,” Upenieks says. “It has been amended very little since then, so it could really use some updating.”
He offers six tips to lawyers who want to avoid these assessments.
Watch for the red flags. “If a client has changed lawyers multiple times on the same file, maybe the lawyer is not the issue,” Upenieks says. “Also, beware of clients who have lodged complaints with the Law Society of Ontario. They are probably the type of person who will never be satisfied by the quality of legal services provided.”
Another red flag is someone who demands that every step of their case be completed on an urgent basis, but on a limited budget, he says.
“When it comes to price, quality and timeliness, no one can deliver on all three at the same time,” Upenieks says. “A client who demands that should be avoided.”
Have a retainer agreement specifying hourly rates. “Always get a retainer up front,” he says. “Even at Tim Hortons you have to pay first, and likewise, lawyers want the client paying the retainer up front, and then having it replenished as the file goes along.”
Monitor accounts receivable. “Stay on top of the billing, and don’t let it get out of hand,” Upenieks cautions. “Growing accounts receivable are sometimes an early indicator of a problem client, and often these are the clients who turn on the lawyer.”
Keep the client informed, and put everything in writing. “Advise the client, in writing, about risks, costs and likely outcome and do so on a regular basis,” he says. “If the client does not accept your recommendations and is insisting on a certain course of action, send a letter confirming your advice, their refusal to follow it, and have them sign off and return the letter to you.”
Don’t try to self-represent. If a lawyer is called for an assessment, Upenieks says that a person should seek the advice of someone who has done this type of hearing before, in the jurisdiction where it will be held. By their nature, he says these processes are different than most lawyers may be accustomed to, with unique practices and protocols.
Know the nine factors considered in an assessment. Upenieks says most Solicitors Act assessments are based on a 1985 Ontario Court of Appeal decision, which spells out nine factors to be considered.
“This case is referred to time and time again in determining what is a fair and reasonable fee,” he says, noting that the most important factor is the time appropriately expended by the solicitor. “Just because the lawyer docked 100 hours, doesn’t mean that they will be awarded their hourly rate times 100 hours,” he warns.
Upenieks says the second most crucial factor is the results achieved.
“When there is a fee dispute, you are often at opposite ends of the spectrum,” he says. “Lawyers will claim that the case was successful and that much was accomplished, despite significant hurdles and challenges, while clients will sometimes try to downplay the ultimate results, or suggest that their own contributions played a significant role in the case.
“Solicitors need to practise preventative maintenance. It’s always better to prevent the bus from falling over the cliff, than to try to fix the passengers afterwards,” Upenieks says.