Legal fees are often a major factor for parties considering pursuing legal proceedings. Even where their claim is meritorious, parties may find themselves unable to afford the costs required to vindicate their legal rights.
For some foreign jurisdictions, one method of addressing this gap and enhancing access to justice is conditional fee agreements (“CFAs“). CFAs are a type of lawyer-client arrangement whereby a lawyer receives payment of the whole or part of his or her legal fees only in specified circumstances, for example where the claim is successful. Prospective litigants with strong claims are therefore better able to pursue their claims in court without being hindered by a lack of funds.
Thus far, CFAs have been prohibited under Singapore law. However, following a favourably received public consultation on a proposed framework for CFAs held in August 2019, the Legal Profession (Amendment) Bill (“Bill“) was tabled for First Reading in Parliament on 1 November 2021. If passed, the Bill will create a framework to allow a statutory exception for CFAs for specific contentious proceedings.
While the exact categories of proceedings will be set out in future regulations, they are expected to include:
- international and domestic arbitration proceedings;
- certain proceedings in the Singapore International Commercial Court (“SICC“); and
- court and mediation proceedings related to the above.
In this Update, we look at features of the proposed CFA framework and its advantages to both prospective litigants and the legal landscape in Singapore.
For more information, click here to read the full Legal Update.
