What the Solicitors Act allows in a contingency fee

Permitted, in writing, with two exclusions

The Solicitors Act allows an agreement under which remuneration is contingent, wholly or partly, on the successful disposition or completion of the matter. It must be in writing — there is no oral contingency fee.

Two areas are excluded outright, and the exclusion is not a matter of judgment:

• Proceedings under the Criminal Code, and any other criminal or quasi-criminal proceeding.
• Family law matters.

The maximum, and the only way past it

Where the fee is a percentage of the amount or value of property recovered, the amount paid to the solicitor may not exceed the maximum percentage prescribed by regulation, however the amount or property is recovered. The figure lives in the regulation rather than the Act, so it is a number to look up rather than remember.

Exceeding it is possible but deliberately awkward. It requires a joint application by the solicitor and the client to the Superior Court, brought within 90 days after the agreement is executed, and the court considers the nature and complexity of the matter and the expense or risk involved.

Costs are treated separately, and deliberately

A court is not to reduce a costs award merely because the client's solicitor is being paid under a contingency fee agreement. And a client may recover the full amount of a costs order even where it exceeds what they owe their own solicitor under the agreement, provided the client is to use it to pay that solicitor.

Both provisions exist to stop the fee arrangement quietly reducing what the successful party recovers, which would make the arrangement worse for the client rather than better.

Two prohibitions that apply to every retainer

Sitting beside the contingency provisions are two limits worth knowing whatever the fee arrangement:

• A solicitor may not enter into an agreement purchasing all or part of the client's interest in the action or contentious proceeding they are to bring or maintain.
• A term relieving the solicitor from liability for negligence, or from any responsibility they would otherwise carry, is wholly void — not merely unenforceable against a sympathetic client.

Assessment

A client under an ordinary contingency fee agreement may apply to the Superior Court to assess the bill within 30 days after its delivery, or within one year after paying it. Where the agreement was one requiring court approval, the timing is set by regulation instead.

Thirty days is short. It is another reason for the bill to explain itself on its face rather than rely on a conversation the client may not remember having.