Most people think Legal Aid Ontario (LAO) is “free”, in the sense that clients with Legal Aid Certificates do not pay the legal fees out of their own pockets.
However, there are several exceptions to this rule. LAO routinely recovers costs and contributions from clients with contribution agreements, property liens, and settlement funds.
For clients whose income is higher than the financial eligibility, LAO from time to time issues Certificates with contribution agreements. The lawyer accepting the certificate will perform the services at the prescribed rate and collect money from LAO. At the same time, the client agrees to pay back part or all of the lawyer’s bill through a payment plan. This is a win-win situation in the sense that LAO can recover the cost and be accountable for the taxpayers money, while the clients are able to proceed with their matters expediently.
If a client meets the financial eligibility requirement on his or her income but owns real property, LAO may require the client to agree to a lien on the property. This lien is authorized by the statute. The client may remove the lien by paying back the amount owing to LAO, or LAO may recover the amount throughthe lien when the property is sold or transferred.
With respect to settlement funds by law LAO is entitled to recover part or all of the cost if the matter is settled and the client receives settlement funds. Hence, most settlement funds are paid to the lawyer handling the case in trust.
In some cases LAO may consider a waiver to recovery. These cases are rare. Generally, LAO will only waive the statutory charges against the client if failure to do so will cause hardship. As such, clients with a contribution agreement or a property lien are generally not qualified.