Today, lawyers get paid per filing and per hearing. This has made law a government job. Make contingent contracts legal; that’s it. No other reform is needed for the Indian judicial process. Pay your lawyer if and after he/she wins the case for you. There are millions of young confident lawyers today in India, who will challenge established old lawyers in court with a contingent contract in place. This will lead to faster judgements. For such a scenario to happen, the contingent contract with advocates has to be made legal by Parliament. Write to your MP.
By Debasish Roy, CEO, Royalle Corporation (www.royalle.in)
Today, lawyers in India get paid per filing and per hearing. This has made law a government job. Make contingent contracts legal; that’s it. No other reform is needed for the Indian judicial process. Pay your lawyer if and after he/she wins the case for you. There are millions of young confident lawyers today in India, who will challenge established old lawyers in court with a contingent contract in place. This will lead to faster judgements. For such a scenario to happen, the contingent contract with advocates has to be made legal by Parliament. Write to your Member of Parliament (MP).
The problem lies in the judicial system where all power goes out of the client’s hands once the case is filed. After that the power to decide, to delay and to destroy solely lies with the advocate who is either acting as lawyer or judge. The simple solution suggested by ROYALLE CORPORATION to the government is to make contingent contracts between advocates and their clients legal, as it is in the USA. This will ensure fast justice and no delays without any bribes. This one reform will change the judicial process in India, overnight.
You recently observed Sanjeev Sanyal, Honourable Member Economic Advisory Council to the Prime Minister that “the Indian judicial system is the biggest hurdle to the Viksit Bharat vision.” He added that “You can’t have a profession where you use words like ‘My Lord or a petition as ‘Prayer’. The judiciary is a public service like any other part of the state.”
Meanwhile, mediation is an oft touted solution to delay in litigation. Promoting mediation implies that the court and the state accept that litigation is useless. Why can’t litigation be achieved in one month instead of 20 years? The answer is not mediation but enforcing the contingent contract between advocates and their clients. This will speed up litigation, making it efficient, dispensing justice as a result.
Observations: The Indian judiciary is inefficient. It takes five years to wrap up a simple civil suit with little or no foundation, which ought to take 15 days. The current procedure was designed to shield Englishmen from criminal and civil suits, which Indians may have filed against them. This was a stalling technique. The very dictum that even if a score of guilty go free, but not one innocent person should be convicted, shows that the judicial system is ready to let scores of Englishmen or priviledged class go scot free. Currently, government servants and priviledged class in India have replaced imperialist Englishmen. Judges grant passovers and adjournments at the drop of a hat on reasons as flimsy as advocate is not ready, advocate is unwell, charge sheet or copy of summons is not legible and advocate does not have the file.
This procedure helps frustrate the law and not dispense it. Plaintiffs and defendants are charged by advocates per hearing rewarding this inefficiency. Lazy judges are in cahoots with the advocates to drag on the matter draining the client of money, achieving nothing.
Make contingency contracts between advocates and their clients legal. This will ensure that advocates get paid on performance and not on the clock. Therefore, advocates will push for early closure of the case and not drag it on. This will also allow young, intelligent advocates armed with contingent contracts with clients to challenge older, more experienced and well-entrenched advocates operating through large firms. Victory in court will ensure more money unlike the dispensation now which is win or lose you get paid a pretty packet. Following this, advocates will also push for abolition of the summer vacations at courts.
In India, the current law makes contingency contracts with advocates illegal through the Bar Council of India (BCI) rules and the Indian Contract Act, 1872. Rule 20 of the BCI prohibits advocates from stipulating for fees contingent on the outcome of litigation or sharing in the proceeds, while the Indian Contract Act renders such agreements void as being against public policy. The reasoning is that these contracts compromise the advocate’s independence, objectivity, and duty as an officer of the court. Such reasoning is archaic and obsolete. The world has changed, so has the economy, so has speed in communication. Removal of this SINGLE obstacle in making the legal process faster and more efficient will be welcome at all sections of society except with lazy and entitled law men and law women. In one fell swoop, this reform will transform the judiciary and the bar in India, overnight. This will solve, terms of address, summer vacations, unnecessary adjournments and lack of preparation by advocates during hearing.
A contingent contract with a lawyer, or more commonly known as a contingency fee agreement, is a contract where a lawyer’s fee depends on the successful outcome of the case. Under the Indian Contract Act, 1872, such agreements are generally considered void as they are against public policy and the ethical code of lawyers in India, though non-advocates are sometimes permitted to charge these fees.
- Success-Based Fee: The lawyer receives no fee if they lose the case. If they win, they take a pre-agreed percentage of the award or settlement amount.
- Uncertain Event: The “contingent” event is the successful outcome of the case, such as winning a lawsuit or securing a settlement.
Legality and Ethics in India
- Ethical Concerns: The Supreme Court of India has consistently held that contingency fee agreements are against public policy and professional ethics, as they can lead to the unethical practice of lawyers having a stake in the outcome of litigation.
- Advocates Act, 1961: The Advocates Act and the ethical conduct expected of lawyers prevent them from entering into such agreements.
- Exceptions: However, individuals who are not advocates under the Advocates Act, 1961, but are acting as “counsels” (such as paralegals), may be permitted to charge contingency fees.
Why They Are Used (in jurisdictions where permitted)
- Access to Justice: Contingency fees can provide crucial access to legal representation for individuals who might not otherwise be able to afford a lawyer.
- Risk Mitigation: The risk of paying a lawyer is shared between the client and the lawyer, as the lawyer’s payment is contingent on success.
- Alignment of Interests: Both the client and the lawyer are motivated to achieve the best possible outcome for the case.
Legal in the USA and many other countries
Contingent fee contracts are legal and common in the United States, Canada, South Korea, and some other countries including the United Kingdom, Australia, Brazil, Ireland, Japan, New Zealand, and France. However, they are illegal and prohibited by legal ethics in India, where they are considered against public policy. While the UK uses a different system called conditional fees, some European countries are increasingly adopting variations of contingent fees.
Yes, contingent fee arrangements are legal and widely used in the U.S.A for financing civil lawsuits, allowing attorneys to be paid a percentage of the client’s recovery if the case is successful. These agreements ensure lawyers only get paid for winning cases and are written, signed, and detail expenses and the fee calculation method. However, they are prohibited in domestic relations (divorce) and criminal defense cases.
What is a Contingent Contract?
A contingent contract with a lawyer, also known as a contingency fee arrangement, is a conditional agreement where the lawyer’s fee is paid only if the lawsuit is successful or results in a favorable settlement.
The fee is typically a percentage of the amount recovered for the client.
Why Are They Legal and Used?
Access to Justice: Contingent fees enable people with limited means to afford legal representation and pursue their civil rights, even if they couldn’t otherwise afford to sue.
Incentive for Success: Attorneys have a strong incentive to win for their clients because their payment depends on the outcome of the case.
Risk Shifting: Clients can shift the financial risk of litigation onto the lawyer.
Legal Requirements in the U.S.
Written Agreement: The agreement must be in writing and signed by both the client and the attorney.
Clear Disclosure: The agreement must state the method by which the fee is determined (e.g., a specific percentage) and clearly notify the client of any expenses they will be responsible for.
Post-Case Statement: At the conclusion of the case, the lawyer must provide the client with a written statement detailing the outcome.
What’s Not Allowed
Contingency fee agreements are prohibited in domestic relations matters (like divorce) and for the representation of a defendant in a criminal case.
Common Examples Personal injury cases, Medical malpractice cases, Commercial collection cases, and Intellectual property matters.
