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For now, such "no win, no fee" agreements will be permitted only in certain proceedings.
'No win, no fee' agreements for certain legal proceedings allowed from May 4
Selina Lum
Senior Law Correspondent
29.04.2022
SINGAPORE - From Wednesday (May 4), lawyers and clients in selected proceedings will be able to come to an agreement where the clients do not have to pay legal fees if they do not win the case.
The Law Ministry (MinLaw) said in a statement on Friday (April 29) that under Singapore's new conditional fee agreement framework, lawyers and clients in certain cases may enter into "no win, no fee", "no win, less fee", or "win, more fee" agreements.
The law was amended in January to allow conditional fee agreements (CFAs).
Such agreements - where a lawyer is paid his legal fees, or part of his fees, only in specified circumstances - were previously prohibited.
Second Minister for Law Edwin Tong had then said in Parliament that allowing such agreements helps to level the playing field for Singapore lawyers in certain practice areas, in relation to foreign lawyers who can offer such agreements.
For now, such agreements will be permitted only for international and domestic arbitration proceedings, some proceedings in the Singapore International Commercial Court, and related court and mediation proceedings.
These proceedings typically involve high-value commercial disputes.
MinLaw's statement on Friday said the CFA framework is part of ongoing efforts to enhance the Republic's litigation funding landscape to better support the needs of businesses and lawyers.
"It also builds on reforms in the litigation funding space and enhances Singapore's offerings as a dispute resolution hub."
To mitigate the risk of potential abuse, a lawyer is required to provide certain information to the client before they enter into such an agreement.
Among other things, lawyers have to tell clients about the nature and terms of the agreement and that the client continues to be liable for any costs orders that may be made against him by the court or arbitral tribunal.
The conditional fee agreement must also include certain prescribed terms, including the particulars of the specified circumstances in which remuneration and costs are payable to the lawyer and a cooling-off period of five days after an agreement is signed.
Lawyers will continue to be subject to existing professional conduct rules against overcharging, said MinLaw.
It added that the Law Society is preparing a guide on the new framework for firms and lawyers.
