Advertising and Fee Arrangements

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The Law Society’s Advertising and Fee Arrangements Issues Working Group is continuing to consider and develop regulatory responses to issues relating to advertising, referral fees, and contingency and other fee practices.

Contingency Fee Reforms Consultation

The Advertising and Fee Arrangements Issues Working Group would like to hear from lawyers, paralegals and the public about potential changes to the regulation of contingency fees.

The group has released a Consultation Document on its proposed:

  1. Mandatory Standard Contingency Fee Agreement
  2. Know Your Rights Guide for the Public
  3. Related rule amendments

For additional information, see the Working Group’s report to February Convocation.

- Deadline for submissions is March 20, 2018.
In order to be sent using the online submission form, your submission document must:

  • be a PDF, DOC or DOCX file
  • be no bigger than 5 MB

Submissions will be provided to the Advertising and Fee Arrangements Issues Working Group, Professional Regulation Committee and to Convocation and may be reproduced, and/or made publicly available by the Law Society, with attribution.
The Law Society reserves the right to redact submissions at its discretion, for reasons including the protection of confidentiality, copyright, and brevity.

If you prefer to send your written input by mail, please mail documents to the following address:

Advertising and Fee Arrangements Issues Working Group
The Law Society of Upper Canada
130 Queen Street West
Toronto, ON M5H 2N6

The Working Group’s call for comment on contingency fee reforms follows the approval by Convocation, in December 2017, of the seventh report of the Advertising and Fee Arrangements Issues Working Group, which focuses on plans to regulate contingency fees. The regulatory plans are designed to protect access to justice for the public, while ensuring protection from unscrupulous practices and unreasonable fees. On January 25, 2018, Convocation approved additional recommendations that expand on the recommendations approved in December. The Working Group’s recommendations regarding the regulation of contingency fees, follow an initial call for input in 2017.

Advertising Rule Amendments

New rules re: advertising residential real estate services – September 28, 2017
New rules for the advertising of fixed-price residential real estate services were approved to support transparency and ensure consumers may easily compare prices

Amendments to advertising rules – February 23, 2017
Convocation approved rule amendments to strengthen the rules governing the advertising of legal services , adding new public protection measures.

Referral Fee Resources and Information

On April 27, 2017, the Law Society set a cap on referral fees based on a percentage of the legal fee:15% for the first $50,000 of legal fees and 5% of all legal fees thereafter, to an absolute cap of $25,000.

Lawyers and paralegals are also required to use the following documents: 

  • Mandatory Referral Agreement (Revised June 2017) - Word – Fillable PDF  
  • Law Society Requirements for Referral Fees – What Clients Need to Know (PDF)

New Referral Fee Resources - To support licensees in understanding and complying with the new referral fee requirements, the Law Society has developed:

For more information on all referral fee requirements see the report to Convocation.

About the Advertising and Fee Arrangement Issues Working Group

The nature and volume of advertising for legal services is evolving rapidly, along with the legal services marketplace. The Law Society established the working group, in February 2016, to determine whether by-law and rule amendments may help ensure advertising and fee practices continue to be accurate, transparent and in the public interest.

The Working Group received a great deal of information about these issues, including advertising that may be false or misleading and fees that are not transparent and appear to have an impact on the way in which legal services are being provided, including:

It has received a great deal of information about these issues, including advertising that may be false or misleading and fees that are not transparent and appear to have an impact on the way in which legal services are being provided, such as:

  • Advertising for legal services with a view to obtaining referral fees
  • Use of endorsements and awards that are not objectively verifiable
  • Lack of clarity in “all-in” pricing for legal services
  • Disproportionate referral fees, both upfront and as a percentage of the result in a contingency fee matter
  • Lack of transparency in contingent and referral fee arrangements  
 

History


 


 

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2011 – 2014 – Concerns about advertising are growing. A specialized Investigations team is established to respond. Complaints grow from 115 to 141 complaints, including those initiated by the Law Society.
2015 – Professional Regulation Committee develops proposed amendments to Rules of Professional Conduct and conducts a  Call for Input.


 

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Nov 2015 - Professional Regulation Committee reviews input and determines further study is required before deciding on advertising and marketing rules.

Feb 2016 – Professional Regulation Committee establishes the Advertising and Fee Arrangements Working Group.

 

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March to May 2016 – The Working Group holds focus group meetings with legal organizations and the professions to gain better understanding of current practices and issues.
June 2016 – The Working Group reports overview of input to Professional Regulation Committee and Convocation. ( Working Group Report Tab 2.2.2)

 

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July 2016 – Call for Feedback to licensees about potential regulatory responses. ( Working Group Report Tab 2.2.1
Sept 2016 – Call for Feedback closes. The Working Group will review feedback received.

               

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Feb 2017 – The Working Group reports to the Professional Regulation Committee and Convocation.

April 2017 - Working Group recommends referral fee cap and other regulatory measures.

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June 2017 – Working Group launches consultation on contingency fees.

Sept. 2017 – Convocation approves new rules for advertising real estate legal services.

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Sept. 29 2017 – Final date to provide submissions on Contingency Fees.
November 10, 2017 – The Working Group publishes recommendations on Contingency Fees. 

 

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December 1, 2017   Convocation approves the seventh report of the Advertising and Fee Arrangements Issues Working Group, which focuses on contingency fees. 
January 25, 2018 – Convocation approves additional recommendations regarding contingency fees. 

 

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February 22, 2018   Consultation on contingency fee reforms launched.. 

Related Documents: