August 13, 2020

Withdrawal under a contingency fee agreement

August 13, 2020

If you are withdrawing as counsel of record in a matter, section 3.7 of the Code of Professional Conduct for British Columbia deals with the withdrawal process in detail, including numerous reminders to lawyers of their ongoing obligations to clients. Generally speaking, you must not withdraw except for good cause and on reasonable notice to your clients.

It is important to remember that special circumstances apply for a retainer that is pursuant to a contingency fee agreement.

Rule 3.6-2, commentary [2] provides:

[2] Although a lawyer is generally permitted to terminate the professional relationship with a client and withdraw services if there is justifiable cause as set out in rule 3.7-1, special circumstances apply when the retainer is pursuant to a contingency agreement. In such circumstances, the lawyer has impliedly undertaken the risk of not being paid in the event the suit is unsuccessful. Accordingly, a lawyer cannot withdraw from representation for reasons other than those set out in Rule 3.7-7 (Obligatory withdrawal) unless the written contingency contract specifically states that the lawyer has a right to do so and sets out the circumstances under which this may occur.

This means that where a contingency fee agreement is in place, you cannot withdraw from representation of a client unless you are discharged by the client; the client persists in instructing you to act contrary to professional ethics; or you are not competent to continue to handle a matter (see rule 3.7-7). The only exception to this restriction on withdrawal is if the written contingency contract specifically states that you have a right to do so and sets out the circumstances under which withdrawal may occur.

If you are acting under a contingency fee agreement, review your contract and include express termination clauses if you are concerned about potential limitations on your ability to withdraw.

Additional References

  • Discipline Advisory: Maintaining privilege and confidentiality when ending the solicitor-client relationship (July 13, 2017)