In a recent decision, an Ontario court ordered a plaintiff’s lawyer to provide more information to the court before approving a settlement. The case arose out of injuries that a 7 year girl suffered at birth, leaving her with severe cerebral palsy. She sued the hospital, nurses and doctors who were responsible for her delivery. The girl’s lawyer settled with the hospital. In accordance with the requirements set out in the Rules of Civil Procedure, the girl’s lawyer brought a motion to have the court approve the settlement and the fees being charged by her lawyer. The settlement was reached at a mediation without examinations for discovery or a trial.
The court was not satisfied with the the evidence before it and indicated that it would conduct a hearing to consider the adequacy of the settlement and the claimed contingency fee. The judge ordered that the girl’s lawyer file provide the following material regarding the settlement approval:
(a) I require an explanation of the breakdown of the settlement amount relating to the minor, B.C., as to general damages, pecuniary damages and fees. What amounts are attributed to future income loss and future care costs and what assumptions underlay these amounts (i.e. life expectancy, future care arrangements, level of dependent care).
(b) Please file the experts reports that have been served that address liability. Was there a liability discount in this settlement?
The judge also noted that the contingency fee agreement did not apply on its wording and fees were likely to be fixed on a quantum meruit basis. As a result, he asked the girl’s lawyer to file dockets, billing rates, details of fees being protected, and the degree of risk faced at the outset.