Legal Fees Basics in Family Court
The term "legal fees" is used throughout the legal profession to identify the actual costs associated with having a lawyer act on behalf of an individual, whether it be at court or for the preparation of any document. Basically, legal fees are the lawyers way of saying: "I want to be paid for my time".
Further, an individual is often asked to prepare a retainer (or deposit) against which any legal fees will be charged. It is rare to have all legal fees paid before work is begun, and so practically, the payment of a retainer provides security for both the client and the lawyer.
Individuals are entitled to know the approximate legal fees they will be required to pay, but this amount can be difficult to predict. The costs generally vary depending on the complexity of the case and the amount of work involved. The hourly legal fee could be $150 per hour, $200 per hour, or much higher, and I have even seen some lawyers bill at rates above $500 per hour. The reason it becomes difficult to predict the amount of legal fees is that every case is unique and can require very different levels of advocacy.
In my experience, particularly in Family Court, legal fees tend to be more expensive than individuals expect. However, it is easier to determine the costs of having a lawyer act on behalf of an individual where there is generally a predetermined result and timeline (for example, an uncontested divorce or separation agreement).
Family Law is complicated, and each case is unique. Without a crystal ball, it is almost impossible to estimate the cost of Family Law litigation in Family Court. Many judges say that 80% of cases should be resolved by mediation or negotiation to save legal costs. In general , going to court is extremely expensive and time consuming.
It would be nice if family law matters were simple and could be resolved in short periods of time, but the reality is that for most parents, the issues are simply too contentious to mediate. For some parents, the fight is in their blood, and they simply cannot avoid a trial, regardless of the legal fees involved. Even if the matter is not high conflict, going to court generally means that both parties have to take significant time off work to attend trips to court.
A family with children, where there is a conflict, can easily spend $20,000 to $30,000 on legal fees spending more time in court than should have been necessary.
I would say the median family law case takes about two years from start to finish and costs anywhere from $16,000 to $25,000 in legal fees. There are things you can do to get through a family law matter in a cost effective manner, including simply focusing on what is best for your children. The more conflict at the centre of your case, the more expensive it will become.
A client retaining my services recently observed: "lawyers don’t seem to help; they only litigate!" In this age of the internet and self help legal literature, there are actually few cases that require litigation. I regularly tell clients: "we can work this out amicably, or we can go to court. Your choice." In my experience, it is almost always in the parties best interest to avoid family court and the danger of a judge making decisions for you, rather than making them yourself. This is particularly true in a population as diverse as we are in Toronto.
Criteria for Awarding Legal Fees
Legal fees can be claimed in Family Court in certain circumstances. There is a general presumption in family law cases that each party will bear their own costs. The Family Law Rules provide arbitrarily that the successful party will not be entitled to claim their costs. This presumption is subjective (and rebuttable) and it implicit in the Rules themselves. There are still occasions when legal fees can be claimed. They can be claimed under the following circumstances. 1. There is intentional egregious misconduct. 2. There is hopeless litigation. 3. Obtaining or defending an interim order. 4. Superior negotiating position. 5. Non-disclosure of relevant facts. 6. Claims in tort or equity. 7. Significant asset hiding. 8. Ability to pay. There are two laws in Ontario that families can apply to for their legal fees; the Family Law Act (FLA) and the Solicitors Act (SA); both in Schedule B of the FLA or as a result of case law. When determining costs in family law cases, the judge may permit costs to be awarded in accordance with section 131 of the Family Law Act or section 3 of the Solicitors Act. The favourite approach of most judges is cost awards through case law and not through the Family Law Rules themselves.
Typical Circumstances for Awarding Fees
There are a number of circumstances where one party could be ordered to pay the legal fees of the other. As mentioned above, these fees can be awarded during a case or after its conclusion. Here are the most common situations where that ruling would apply:
- Financial disparity – If the parties have unequal access to marital funds or income, a court could order the higher-earner to pay fees for his or her spouse. For example, if one party has been a stay-at-home parent while the other has consistently grown his or her business or career, the lower earner would not control available resources. A legal fee award would allow both parties to pay for their own counsel, which is especially important in high-asset cases.
- Bad faith – If one party is purposefully dragging his or her feet or otherwise acting against the best interests of the case, such as by refusing to cooperate with the production of documents or discovery, the court could order them to pay the fees incurred by the other party in trying to get an answer. This is often used to weed out meritless objections and delay tactics.
- Overreaching – A court may find that a party’s legal assertions or demands are completely ludicrous, and therefore must be met with legal action, which leads to unnecessary expenses for the other side.
- Award with child support – In some cases, a court will award the other party legal fees when awarding child support. For instance, if a court finds that a mother is earning significantly less than her husband, even financial parity should not come into play when fashioning child support, and the father should foot the difference between the parties’ incomes. When that is an issue, the court may decide that since the father is going to be paying a greater percentage of the family’s living expenses, it should also bear the cost of his wife’s legal fees.
How to File a Claim for Fees
A claim for legal fees is made in a sworn statement called an Affidavit of Legal Fees. A competent family law lawyer should be able to prepare the Affidavit for you.
The lawyer needs to provide certain information based on their retainer agreement and the records they keep about their work and the disbursements incurred. Specific information is required, such as, the hourly rate of the lawyer and the rate charged for other people in their office, and a copy of any written retainer agreement given to the other party or other solicitors.
The Affidavit of Legal Fees should also include a copy of the bill sent to the client for fees and disbursements (at least in part, to protect accounting information that should not be disclosed) . If there are disbursements such as filing fees, process server fees, or fees to pay a doctor to prepare a report, these should be included, or at least set out in a schedule to the Affidavit.
Finally, a calculation must be done to show how much money is owing at the time the Affidavit of Legal Fees is prepared.
It is important to be aware that if Court Approval is given to pay legal fees, the amount may be subtracted from the division of property by a Court Order. For example, if you were awarded insurance benefits from a fire then the money may be distributed in the following manner:
Obstacles and Considerations
There are a number of considerations that a person interested in making a claim will want to appreciate. First, such claims, all other things being equal, are usually at least somewhat successful. Thus, in most cases, obviously no small consideration, is simply the probability of success. A person will rather reasonably be interested in their chances of success before making the claim or agreeing to pay one. That said, other considerations will also come into play. Do people make claims for costs against one another in family law cases? To a large extent, not really. Thus, one person making a claim can look like they are attempting to "stick it" to the other for no reason. That may not actually be the case, but the other person may well react to the claim in such a manner. Another factor in that regard is that such claims require litigation. Many clients would prefer not to engage in litigation if they can avoid it. Costs claims thus require litigation, an additional expenditure of legal fees and, almost invariably, have to be dealt with by most lawyers in the form of an additional and unreimbursed item of "disbursement". Simply put, "lawyer’s fees are one thing, but, by the way …", disbursements can be a huge amount of money. Not everybody wants to spend a large amount of unreimbursed money on a claim that may or may not succeed, with the corresponding allocation of judicial resources, when they could make a "go away offer" for much less. In large part, that consideration will depend on the parties’ positions. The more intransigent a party is, the more likely the other party will feel compelled to make the claim. In other words, if one party feels put upon by the other, it is more likely to make such a claim itself and attempt to recover its costs. If, on the other hand, a party is relatively willing to pay its own way within some tolerance, the other party may be more likely to withdraw the claim. There is also a need to review, considering a number of factors, one’s quantum and likelihood of success. If the matter is really not likely to succeed, the claim may not be worth the trouble or expense. Also, the parties may have a variety of issues that, not having been aired in such a context, they may be amenable to wind up given due consideration without the threat of expensive litigation out there in the shadows. In such cases, the parties discuss issues and settle them without trial or the public airing of a great deal of detail, other than on the basic points required for any settlement documents – the parties will often resolve all of the collateral issues, pursuant to a Settlement Agreement that has to be prepared after the fact.
Case Law Examples and Precedents
Case Study: Kurbasi v. Kurbasi, 2014 ONSC 3945 (CanLII)
In this case, the wife was ordered to pay the husband’s legal fees because she had delayed a trial by two years and caused him additional costs. This award was for a partial indemnity, which is a lower costs award than would be looked at in motions court, but it illustrates that the court is willing to issue costs awards against parties even where family law practices are taken into account.
From the Decision:
"[4] In short, there is nothing in the recent jurisprudence which suggests that the factors in determining costs in a family law litigation are any different than those under the former Costs Act. Neither linea nor family are ‘specialized’ categories for costs awards. As discussed above, there is simply no evidence to suggest that the parties in this case are unable to pay their own costs on a full indemnity basis, as based on their standard of living during the course of the marriage.
[5] As well, while the principle of fairness and the concept of access to justice are taken into consideration in determining costs, this does not mean that a costs award must be limited in its application and restricted to full indemnity costs or no costs at all. In family law cases, as in other types of cases, it is within the discretion of the Judge whether it is appropriate to award full or partial indemnity costs, and the determination of whether costs awarded are on a full indemnity basis, a partial indemnity basis, or no costs at all is not subject to review except in a patently unreasonable case. As well, the fact that the relationship between the parties is over will not preclude a costs award. Second, while the fact that parties may face disincentives to pursuing an action may be relevant in determining if it is appropriate to award costs , that is not the only factor to be considered. Third, costs awards can be made for the purpose of punishing misconduct and willful or egregious conduct.
[7] Parties cannot use costs awards as a type of settlement currency and judge their likelihood of success both on the substantive issues and the costs awards to be made against them. Finally, the potential for future costs awards should not be used as a reason to slow down or prevent litigation. There are already built-in legislative (Family Law Rules) and procedural (Traditional costs approach and a simplified procedure) cost control mechanisms available in order to ensure cost-effective access to justice without restricting the right to litigate. These mechanisms balance the interests of access to justice with the need to prevent abuse."
A similar case was In Panakoit v. Beힷ 2013 (CanLII), where the Court found:
"[32] A full indemnity costs award is reserved for unusual or special circumstances, and the general rule in the Family Law Rules is that costs awards are made on a partial indemnity basis. Whether the full or partial indemnity costs principles will apply in a family law proceeding appears to be within the discretion of the presiding judge. The factors considered in assessing whether a full indemnity or partial indemnity award is warranted appear to be the same in family law and civil proceedings [see Fero v. Hill, 2010 ONSC 463 (CanLII); 2010 ONCA 521 (CanLII).] Consistent with this body of jurisprudence, the award sought by the applicant is beyond the range of costs on a full indemnity basis, absent unusual or special circumstances. Ordinarily, in family law matters, costs awards made on a full indemnity basis arise out of extreme and exceptional circumstances."