Ontario court allows First Nations’ challenge of fees charged by their lawyers

Thursday, December 11, 2025

In its recent decision in Nootchtai v. Nahwegahbow Corbiere Genoodmagejig Barristers and Solicitors, the Ontario Superior Court of Justice disallowed a partial contingency fee arrangement for the lawyers in the Robinson-Huron Treaty annuities litigation. This arrangement would have paid the lawyers $510 million, or about 5% of the $10 billion settlement in that litigation.

In this blog post, we explore the Court’s decision by first explaining the different ways that lawyers may structure their fees, why the Court called the fee arrangement in this litigation “unusual” and disallowed it, and what First Nations can do if they have concerns about fee arrangements with their lawyers.

How lawyers structure their fees

Typically, lawyers structure their fees in one of the following ways:

Fixed fee arrangements. Lawyers charge their clients a fixed amount for doing certain work. This is normally used for routine tasks like drafting wills.
Contingency fees. Lawyers charge their clients no fees unless there is a win or a settlement. If that happens, the lawyers take a percentage of the winnings or settlement. Lawyers often work on contingency when the client is unable to pay for litigation but there is the potential for a significant damages award or settlement.
Hourly rates. This is the most common approach. Lawyers charge clients per hour at a fixed hourly rate.

Each fee structure involves different risks and rewards for the lawyer and the client.

In fixed fee arrangements, the lawyer bears the risk that the work may be more complex than anticipated. If that turns out to be the case, the lawyer will have to do more work than expected at the agreed price. The client, on the other hand, gets more complex work done for less money.

In contingency fee arrangements, the lawyers take on substantial risk since they will only get paid if the litigation is successful or if there is a settlement. If the litigation is unsuccessful or there is no settlement, the lawyer gets nothing for their work. Because no fees are charged throughout the litigation, these arrangements can be crucial for securing access to justice for First Nations with limited resources.

Payment at hourly rates shares the risks/rewards more evenly. The lawyers get paid their fees no matter the outcome of the litigation. But if the litigation results in a large damages award or settlement (as class actions often do), the lawyers do not share in that.

These types of fee arrangements are not unique to when lawyers work for First Nations. Fee arrangements between lawyers and any client, not just First Nations, are subject to review for whether they are fair and reasonable. That is because in any lawyer-client relationship, clients often rely on the lawyer’s advice.

The fee arrangement in the Robinson-Huron litigation and the legal challenge

The fee arrangement between the lawyers (the “Litigation Team”) and the First Nations in this litigation required the First Nations to pay the Litigation Team 50% of their fees throughout the litigation, plus a “Contingent Success Fee” equal to 5% of any winnings or settlement (the “Fee Agreement”).¹

This was “unusual,” remarked the Court, since lawyers usually get paid their hourly rate or a percentage of the winnings / settlement; not both.² And although this was the deal, in practice, the Litigation Team received closer to 75% of their fees because of how they structured their work (they billed $23 million over the decade plus of litigation and got paid that whole amount except for about $5.78 million).³

The Robinson-Huron litigation settled for about $10 billion. The Court pointed out that the 5% Contingent Success Fee ($510 million) that the Litigation Team would have received was more money than 15 of the 21 First Nations involved would receive from the settlement.⁴

Two out of the 21 participating Robinson-Huron First Nations challenged the reasonableness of the success fee in court and won. The Court found that the $510 million Contingent Success Fee “was neither fair nor reasonable.”⁵ The Court’s reasoning was detailed and technical, but it boiled down to three points:

The Litigation Team was in a conflict of interest because it encouraged the First Nations to accept the Contingent Success Fee;⁶
The Fee Agreement was not fair when it was signed in 2011 because the First Nations “did not fully appreciate the risks being undertaken” (in part because they did not receive independent legal advice at the time);⁷ and
The Fee Agreement was not reasonable because, among other things, the Litigation Team did not assume all that much risk compared to a normal contingency fee arrangement (since they got paid most of their fees).⁸

The Court therefore disallowed the Contingent Success Fee. However, the Court also acknowledged the extraordinary work done by and the outcome achieved by the Litigation Team and awarded them $40 million.⁹ The Litigation Team has said that they will appeal.

The takeaway: All clients have a right to know how their lawyers are getting paid

Clients have a right to know and understand how their lawyers are getting paid, and whether that fee structure is reasonable and fair. These protections and rules exist for anyone that hires a lawyer, not just First Nations.

In this case, the Court found that the fee structure was not fair and reasonable. The Litigation Team took on little financial risk, but the Fee Agreement gave them the right to a huge windfall if the litigation was successful.¹⁰ The Court also commented that the First Nations did not receive adequate legal advice about the fairness of the Fee Agreement, and, in fact, the Litigation Team discouraged them from getting that advice.¹¹ The Court took issue with this, since lawyers always have a duty to avoid situations that pit their financial interests against the interests of their clients.

While it is clear that the Court agreed that lawyers should be compensated fairly for the work they do, the clear takeaway is that any fee arrangement between a lawyer and their client must be fair and reasonable. First Nations that have doubts about the fairness of the fee arrangement with their lawyers should not hesitate to get a second opinion from another lawyer.

¹ Nootchtai v. Nahwegahbow Corbiere Genoodmagejig Barristers and Solicitors, 2025 ONSC 6071, paras. 43, 60 [Nootchtai]