December 6, 2024 from Angelica Dino via Law Times News
In a recent medical malpractice case involving a child left with cerebral palsy after a birth injury, the Ontario Superior Court of Justice reduced a law firm’s legal fee from the requested $4.1 million to $3.25 million. The court found the contingency fee arrangement lacked fairness, transparency, and essential legal disclosures.
The Background: A Devastating Birth Injury
The case stemmed from a 2009 delivery during which the child’s brain was deprived of oxygen, leading to a later diagnosis of cerebral palsy. In 2015, the family retained Almeda Wallbridge of Wallbridge, Wallbridge to pursue a lawsuit against the hospital and medical staff. The case ultimately settled in 2023 for $14 million, covering both damages and legal costs.
Fee Agreement Fails Legal Requirements
The firm sought approval for its fee under a 2018 contingency fee agreement (CFA) that promised one-third of the damages—totaling $4.1 million. Because the client was a minor, court approval was required. Upon review, the court found that the CFA failed to meet the standards under Ontario’s Solicitors Act, which governs legal fees and mandates clear client disclosures.
Key problems included:
- Lack of explanation about alternate fee options
- Missing details on client decision-making rights
- A power imbalance worsened by the family’s vulnerable position
The court noted that consumer protection was at the heart of CFA regulations, particularly when clients are inexperienced or under disability.
Billing Discrepancies Raise Doubts
The firm also submitted reconstructed time records showing over 3,000 hours of work—but without contemporaneous timekeeping. The court found the records unreliable and noted that the settlement amount was lower than initial damage estimates from both sides.
A Balanced Fee: $3.25 Million
In determining a fair fee, the court considered:
- Time and complexity involved
- Results achieved
- Risk assumed by the law firm
- The client’s long-term needs
The court emphasized that contingency fees must be fair in each individual case, not based on a lawyer’s overall practice. The adjusted fee aimed to preserve more of the settlement for the child’s lifelong care.
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