Contingency Fees Explained: What Ontario Motorcycle Injury Victims Need to Know

Personal injury cases can leave victims facing mounting costs, from medical bills and lost income to damage to their motorcycle. If you live in Bowmanville or anywhere in Ontario and have suffered a motorcycle injury, you may wonder whether you can afford legal representation. Contingency fee arrangements offer an accessible and effective solution. Here is an in-depth look at how these agreements work, what to know before hiring a lawyer on a contingency basis, and a key Ontario case that sheds light on their proper use.

What Is a Contingency Fee?

A contingency fee means you only pay legal fees if your lawyer recovers compensation for you, either through a settlement or court judgment. Instead of hourly or fixed fees, your lawyer receives a percentage of the recovery, allowing access to justice without any upfront cost.

This model aligns your interests with your lawyer’s. If your case succeeds, they are compensated; if not, you owe no legal fees, however you may still be responsible for disbursements which are out of pocket expenses incurred on your behalf by your lawyer.  

Ontario’s Contingency Fee Rules

The Law Society of Ontario oversees contingency fee agreements under the Solicitors Act and Ontario Regulation 563/20. Key rules include:

• Fee caps: A lawyer cannot recover more in fees than the client’s total award or settlement (including costs but excluding disbursements and HST).

• Excluding disbursements: Any disbursements awarded by the court are excluded from the contingency fee calculation. 

• Trust payment: A client must direct that funds be paid into the lawyer’s trust account, with fees, costs, taxes, and disbursements drawn out accordingly.

• Assessment window: Either the client or lawyer has six months after delivery of their bill to request a Superior Court assessment.

In 2021, new rules introduced mandatory standard form contingency agreements, emphasizing transparency and protecting clients.

The Advantages of Choosing a Contingency Fee Lawyer

1. Access to representation: You can hire a skilled motorcycle injury lawyer in Bowmanville without upfront costs.

2. Aligned interests: Lawyers are incentivized to pursue strong settlements or favourable verdicts because their payment depends on success.

3. Risk management: If your case fails, you pay no legal fees; only possibly disbursements depending on your agreement and lawyer.

What to Watch For

• Transparency: Your lawyer must clearly disclose percentage rates, disbursement handling, and how the fee is calculated.

• Standard form agreement: All contingency arrangements must use approved forms and include required information such as termination rights, fee percentages, and insurance or legal aid disclaimers.

• Court assessment: You can ask the court to review your lawyer’s bill within six months of receiving it to ensure fees are reasonable.

Case Highlight: Bellama V. Trafalgar Insurance, 2023 ONSC 172 (CanLII)

In Bellama v. Trafalgar Insurance, the Ontario Superior Court of Justice addressed a contingency agreement related to statutory accident benefits. The plaintiff had two contingency agreements— one from 2012 for the tort claim and one from 2018 for the accident benefits claim. The 2018 agreement provided for a 20 percent fee plus HST, excluding costs.

By the time settlement reached the court for approval, concerns arose over capacity, settlement fairness, and whether the contingency agreement met statutory requirements. The court found the agreement did not follow the required statutory form. As a result, it rejected the agreement and determined a fair fee by reference to the risk and complexity of the benefits claims. This case underscores that a contingency arrangement must follow the correct format and be reasonable. It also shows that courts will intervene to protect clients if agreements do not comply.

Why Bellama Matters to Ontario Motorcycle Victims

If you suffered a motorcycle injury in Bowmanville, your case may involve both tort damages (against another driver) and statutory accident benefits. It is essential that any contingency fee agreement:

• Uses the Law Society’s mandatory standard form.

• Clearly states the contingency percentage (e.g., 30 percent).

• Separate fees from disbursements.

• Acknowledges your right to a court assessment.

As Bellama v. Trafalgar Insurance shows, courts will look closely at both the fee structure and the protection of client interests.

Choosing the Right Lawyer

When researching a motorcycle injury lawyer in Bowmanville, ask each prospective lawyer:

1. What percentage do you charge? Ensure it is appropriate for a motorcycle injury case.

2. How are disbursements handled? Confirm whether these are advanced by the firm and when or if they are reimbursed. 

3. Can I see a standard form agreement? This helps you assess its clarity and compliance.

4. What is your experience with motorcycle injury cases? Different cases present different challenges, and experience matters for fair outcomes.

Key Takeaways for Ontario Motorcycle Injury Victims

Contingency fee agreements empower Ontario motorcycle injury victims by offering experienced legal representation at no upfront cost. They align lawyer incentives with client outcomes and reduce financial risk. However, they must follow strict regulations. Bellama v. Trafalgar illustrates that failing to use proper forms or setting unreasonable fees can lead the court to review or reject the agreement.

If you were injured in a motorcycle accident in Bowmanville or anywhere in the Durham Region, consider speaking to an experienced personal injury lawyer. Ask about their contingency percentage, disbursement practices, and standard agreement. A properly structured contingency arrangement can help you focus on recovery while your lawyer fights for maximum compensation.

If you would like to explore how Oshawa Lawyers handle contingency agreements in motorcycle injury cases, or to get a free consultation, contact us today!