How Culture, Economics and Politics Shape Collective Litigation
Edited by Deborah R. Hensler, Christopher Hodges and Ianika Tzankova
Chapter 11: The engine that drives: Fees, costs and the Canadian class action
There are certain fundamental truths about civil justice for victims of mass harm in Canada. Litigation is the predominant mechanism for obtaining redress. Litigation is prohibitively expensive. Those who are harmed cannot afford to pay for legal representation. Lawyers cannot afford to work on a no win, no fee basis unless there is the possibility of recovering their fees at a premium to compensate for their time and expertise. For these reasons, class proceedings statutes in all Canadian provinces provide for contingency fees and multipliers, and thus create financial incentives for lawyers to pursue litigation that otherwise would not be economical for individual litigants to advance. ‘This is the entrepreneurial aspect of class proceedings legislation that enhances “access to justice”.’ While not an end in itself, the creation of a profit-centered litigation bar is the accepted means to achieve the ‘access to justice’ objectives of class proceedings in Canada. Entrepreneurial plaintiffs’ lawyers, therefore, are the engine that drives class action litigation. This simple truth gives rise to complex consequences. Tensions arise between the economic incentives inherent in class actions and a legal culture still firmly rooted in traditional professional norms. For instance, although it is inevitable that lawyers for the class have a far greater financial stake in the litigation than any one class member, many judges remain ambivalent about—if not altogether uncomfortable with—the large fee awards sought by counsel at the conclusion of a case.
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