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Sympathy for clients can sometimes be justified, but it can lead courts to impose on lawyers rather one-sided “contracts”. A vital topic for any contract for services is whether the fee will be a fixed amount, or will be based on other circumstances, such as how much labor later turns out to be required. For a legal retainer, it is the most important topic.

When the express agreement is that the fee will simply be $x per hour worked, barring anything different for results, often the client later asks for an “estimate”. Some clients then later claim that that was a ceiling. In a recent case, that happened. When the retainer was about a year old, the client asked for an “estimate” after the court had fixed the trial date. Having got the estimate, then the client ended by stating that he could not pay more than the estimate. The assessment officer held that that did not change the basic contract, but a King’s Bench justice reversed the officer. He did not cite a long appellate discussion about trying later to add restrictions to an existing contract for billing strictly on an hourly basis: Samson Cree N. v. O'Reilly 2014 ABCA 268, 580 AR 181. It is just possible that the facts in this recent case could justify upsetting the assessment officer. But the justice did not mention the strict but complicated standard of review and differing topics, on appeal.

Unfortunately, this recent King’s Bench decision devotes big parts to suggesting and emphasizing some apparently general propositions. In a dispute about the size of litigation fees, they are very surprising and extremely dubious.

This was not a contract to do solicitors’ work, or to apply to the court for something uncontested. At the outset, the client had retained this very experienced counsel for litigation. The opponent fully contested the matters, so this client either had to abandon his position, or run the full scheduled King’s Bench trial. Therefore, the estimate sought was for preparing for and running the trial.

Maybe the cost of some types of expert work (such as building a one-car garage or filing a caveat) can be reliably estimated. But the amount of work involved in a full trial rarely can be reliably predicted. By definition, the work consists of a fight between two or more opposing parties. Each party is free to choose how to run its case and oppose the other side. Even an attempt to go off into irrelevant or unpleaded avenues will often lead to lengthy procedural arguments and motions. Many other things can produce unexpected motions. Surprise witnesses are always possible. Some opposing counsel are brief and selective in their cross-examination; others take days with one witness. Some witnesses are succinct; others are talkative and will not concede even the obvious when cross-examined. Some opponents cite only relevant persuasive authorities. Others cite a great deal of law not really on point. Some opponents are ready for anything; others are ill-prepared, surprised by many things, and want adjournments. Some opposing counsel control their clients; others do whatever their client wishes. Some counsel are experienced in this type of litigation; others are not, and do not know how to prepare or be efficient.

And this was a “family law” trial. Such litigation is notoriously unpredictable, and often disproportionate. Sometimes it is emotional, even irrational. Here the disputed bill was only about 17% above the estimate, and during trial, counsel had warned the client that they were running over budget. Evidently the client then kept on with the fight. He seems to have paid counsel the required deposit somewhat closer to the trial date.

The justice suggests that it would be absurd for a lawyer to give a budget or hours to be spent and have no obligation to limit counsel’s services to those contemplated in the budget (¶ 23). But estimates and budgets are mere predictions of the future. No person, operation, or business ever ends up with a year’s expenses and revenue, exactly equal to what was budgeted. Unexpected work is very common. Business people know the difference between an estimate and a lump-sum contract. So does the Shorter Oxford English Dictionary. A budget is a periodic estimate, says that Dictionary.

But this justice has very different ideas. He suggests that counsel had entire control over the amount of work he did at trial, or who did the work, e.g. himself or a junior (¶ 20). But counsel could not stop attending the trial when the time estimate ran out. Nor could he from that point sit at counsel table reading a newspaper and doing nothing. The counsel retained was a very experienced counsel practising this type of litigation. He was not a junior inexperienced lawyer. Clearly, he could not in midstream drop out and substitute for himself a junior. Counsel running a trial have contractual and ethical obligations, enforced by the Law Society.

This decision by the justice even accuses the counsel of “wholly improper and illogical” conduct because he did not cease to act and then later billed more than the estimate (¶ 17). And it states that the estimate was just what counsel proposed and entirely within counsel’s control, to create a reasonable expectation (¶ 19). But it was not a proposal, nor a “fee quoted”. And what work would actually need to be done to prepare for and run the trial, was not within counsel’s full knowledge, nor at all within his control, for all the reasons given above. Probably counsel could not cease to act after the trial date was fixed by the court.

This recent decision is Howland v. Foster 2025 ABKB 586 (Oct 14).

– Hon. J.E. Côté

HOURLY RATE v. ESTIMATE