CANADA Law and Practice Contributed by: Craig Ferris, Marko Vesely, Shannon Hayes and Catherine Whitehead, Lawson Lundell LLP
ever, plaintiffs may have more options as to funding arrangements as the third-party funder’s return is typi- cally driven by a successful damages award. 2.4 Minimum and Maximum Amounts of Third-Party Funding For general commercial matters, there is no maximum or minimum amount. If court approval of the funding agreement is required, in assessing the fairness and reasonableness of the bargain in the class action con- text, the court’s decision may be informed by the caps imposed for lawyer contingency fee arrangements. 2.5 Types of Costs Considered Under Third- Party Funding Funding may be provided to pay for disbursements and expenses, all or a portion of legal fees, adverse cost awards and security for costs. 2.6 Contingency Fees The rules of procedure and rules of the law society in each province govern contingency arrangements between clients and their lawyers. The content of the agreements may be regulated, including the termina- tion rights, and the lawyer may be required to provide the client with certain information regarding contin- gency arrangements. Some jurisdictions in Canada impose caps on the contingency percentage, restrict the claims for which contingency arrangements may be permitted or require court approval of the agree- ment. 2.7 Time Limit for Obtaining Third-Party Funding As this area is largely unregulated, there are no time limits for when the funding must be in place.
so, unless the particular cause of action requires some form of prior demand. 3.2 Statutes of Limitations Most common law jurisdictions in Canada have a shorter basic limitation period that applies to most actions, which is largely dependent on when the plain- tiff discovered (or ought to have discovered) certain facts regarding the claim that suggest that litigation ought to be pursued. These jurisdictions also have a longer ultimate limitation period, which typically runs from the date of the act or omission giving rise to the claim. Some common law jurisdictions in Canada have dif- ferent limitation periods based on the type of cause of action. All statutory regimes have rules regarding when limitation periods will be extended or suspend- ed. 3.3 Jurisdictional Requirements for a Defendant Whether a defendant is subject to the jurisdiction of the courts is based on whether there is a “real and sub- stantial” connection between the jurisdiction and the facts on which a claim is based. Some facts include whether the claim relates to a business operated in the jurisdiction, real property located in the jurisdiction, a contract governed by the law of the jurisdiction, a tort committed in the jurisdiction or a trust administered in the jurisdiction. Where a defendant disagrees that they are subject to the court’s jurisdiction, they may apply to the court to dispute jurisdiction. Additionally, even where a court has jurisdiction, a defendant may apply to the court alleging that another jurisdiction is the more appropri- ate forum (forum non conveniens). If the court agrees, a stay of proceedings will be entered. 3.4 Initial Complaint The name of the commencement document that must be filed depends on the jurisdiction’s rules of procedure. For claims requiring a trial, the commence- ment document may be called a “statement of claim”, “notice of civil claim” or “notice of action”. For claims that may not require trial or are less procedurally com- plex, a different document called an “originating appli-
3. Initiating a Lawsuit 3.1 Rules on Pre-Action Conduct
There are some optional legal steps that can be taken before an action is commenced, such as sending a demand letter to the opposing side regarding a pos- sible claim and allowing time for response or negotia- tion. However, there is no legal obligation to do so or consequences imposed by the court for failing to do
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