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Review of Contingency Agreements by the Alberta Courts

The Alberta Courts will at times review lawyers' Contingency Agreements. In the case of Tallcree First Nation v Rath & Company, 2022 ABCA 174, the Alberta Court of Appeal looked at this issue. The Court said at 58:

The reasonableness of a retainer agreement should be measured on an objective basis having regard to the risks, facts and prospects underlying of the retainer: Morrison at para. 27(a). Reasonableness is to be determined based on the circumstances that existed when the retainer agreement was entered into: R. 10.19(2). An unexpectedly high fee does not necessarily mean that the agreement was unreasonable. Clients should not routinely be able to walk away from agreements they have made with their lawyers. In determining “reasonableness”, consideration must be given to the interests and expectations of both the client and the lawyer: Morrison at para. 27. As the Review Officer noted, a client’s unhappiness often first manifests itself after the lawyer has done all the work and incurred all the risk.

The Court ultimately ended up allowing the review of the contingency fee agreed upon, with a dissent by Mr. Justice Wakeling. It will be interesting to see if this matter is further appealed.

If you have questions regarding this matter or any other please feel free to contact us.

The information contained in this article is not legal advice. No solicitor client relationship is formed through this article. The reader is encouraged to retain counsel for advice in these matters.

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