Doing business with a lawyer
Billing for a lawyer's services
The three main ways in which lawyers bill for their services:
1. Flat rate
The lawyer and the client agree on a lump sum the client will pay the lawyer for the work the lawyer performs. Ask the lawyer to indicate whether the lump sum includes disbursements such as the cost of photocopies, transportation, expert reports, and so on.
2. Hourly rate
This is the most common method. The lawyer bills the client based on the number of hours spent on the file (including the time spent on the phone and writing letters). The lawyer must set the hourly rate before beginning any work.
3. Percentage fee
The lawyer agrees to be compensated based on a percentage of the amount the client receives in the case. The lawyer and the client must also agree on what will happen if the client does not receive any money. They can agree that the lawyer will be paid based on merit, at his hourly rate, or that he will only be reimbursed for his disbursements. Percentage fees are often associated with proceedings claiming damages.
Sometimes, the client and the lawyer can agree on several billing methods, each of which will apply depending on the outcome or conduct of the case.
What makes up a lawyer's bill?
When you are a party to court proceedings, there are judicial costs (commonly referred to as legal costs), whose amount is set by the government by regulation and which consist of judicial disbursements. Their purpose is to pay for various services, such as the fees of stenographers or bailiffs, the cost of judicial stamps and so on. According to article 340 of the Code of Civil Procedure, it is the judge who determines who will have to pay them. They are generally awarded in favour of the lawyer whose client won the case and paid for by the losing party.
There are also extrajudicial costs, which are the costs that your lawyer bills you in accordance with the fee agreement between you and your lawyer. They are comprised of extrajudicial fees and disbursements.
Extrajudicial fees are determined in accordance with the various billing methods mentioned above. Extrajudicial disbursements are the expenses your lawyer incurs to handle your case. They may include the cost of transportation, photocopies and long distance calls, among other things. They can also include the cost of expert reports.
Regardless of the billing method you agree on, the lawyer can ask you for a fee advance before starting to work and, from time to time, as the case progresses.
Of course, you can ask your lawyer to explain his use of the advances.
Properly understanding your lawyer's invoice
If you don't understand the invoice you have received from your lawyer, ask for an explanation as soon as possible.
If you don't think the services he provided are worth what he has invoiced you or if you are unable to arrive at an agreement with him, contact the Barreau du Québec in order to use the conciliation or arbitration service. You must apply for this service within 45 calendar days (not business days) after receipt of the lawyer's invoice, otherwise you will lose the right to ask for conciliation or arbitration.