TSBK Ontario PCLaw Bookkeeping: A bi-weekly blog written for small law firms and solo-lawyers practicing in Ontario, and their bookkeepers. While some topics will be of general interest, the target audience are those who use the PCLaw on a regular basis. The focus will be the practical use of PCLaw, especially in relation to the Law Society of Upper Canada's Bookkeeping Guide, trust transactions, and spot audits. Your host: Clyde McDonald - The Satellite Bookkeeper
Contingency fees have been formally allowed by the LSUC since Rule 2.08 was amended, which came into force on October 30, 2002, plus amendments to various acts by the Ontario Legislature.
For contingency matters you are required to have a written agreement. Among the factors to be considered are: the likelihood of success; the nature and complexity of the claim; the expense and risk of pursuing it; the amount of the expected recovery. However, despite your written agreement, your fees are still subject to assessment.
Using PCLaw to track all of your time and expenditures can go a long way towards helping you justify your fees at the assessment hearing. As previously mentioned, Sylvia Loyens has written a very good article which explains why you should be tracking all of the time you spend working in your practice. Here is the link to her article:
Create new matters for contingency files, then track your time normally. You might want to design a custom billing template that shows only hours, and therefore does not show the dollar values.
When the Final Bill is prepared for the client, there will probably be an A/R balance for disbursements, etc. Just bill this client normally until you reach the Billing Information window. Click the contingency button on the right side – enter settlement amount – percentage rate i.e. 30.0 – PCLaw will calculate fees – you can split the contingency fees between lawyers - there is room to add an explanation code and notes - OK. Enter the total owing in Trust Balance window to transfer the funds, OK.
As always, I invite your comments and suggestions for future posting topics. Next week – Accounts Receivable.