Terms and Conditions of Appointment for Domestic Legal Agents
14. Submission of Accounts
14.1 Billing Period
The legal agent must, at a minimum, bill the Department on a quarterly basis.
The federal government fiscal year is from April 1st to March 31st of the next calendar year. The legal agent must only bill for services rendered and disbursement costs incurred during one fiscal year, and must submit all accounts (interim and final) no later than April 10th of each new fiscal year for work performed in previous fiscal year, even if the work on the file is not yet complete.
14.2 Claiming Fees
The legal agent must submit an itemized account to instructing counsel for verification. The account should provide a detailed description of activities performed and time spent in chronological order. Each account must refer to one file or piece of work assigned.
The portion of the account for professional fees should be structured so that the Department and the client can easily identify:
- the description of work performed;
- which member of the agent legal team performed the work;
- the hourly billable rate of that member of the agent legal team;
- how many hours (expressed in 0.1 hour increments) were spent on the work;
- on what date the work was performed;
- total fees claimed plus GST, HST and/or PST, as applicable; and,
- evidence that pre-approval was obtained, if applicable.
14.3 Claiming Disbursements
The legal agent must itemize and record all disbursements against the appropriate file on which the cost was incurred, and must structure the disbursements so that the Department and the client can easily identify:
- total taxable disbursements claimed plus GST, HST and/or PST, as applicable;
- total non-taxable disbursements claimed;
- the nature of the disbursement;
- the purpose of the disbursement; and,
- on what date the disbursement was incurred.
Unless otherwise specified, the Department requires that individually-itemized claims for disbursements in excess of $50.00 be supported by proof of payment. The legal agent must ensure that all receipts related to expenditures less than $50.00 are kept on file in the event they are required by the Department.
The legal agent must submit accounts together with any reports or documents required by instructing counsel.
14.4 Case and Billing Numbers
The legal agent must ensure that the case and billing numbers set out in the letter of appointment are referenced in all accounts. If the case number and billing number are omitted or used incorrectly, the processing of the account may be delayed, or the Department will return the account to the legal agent for correction.
14.5 Taxes
Federal government departments and agencies are required to pay applicable taxes. The rate of tax to charge for a supply is determined by the province or territory in which the supply is made, referred to as the place of supply, and is dependent on the type of supply. This is governed by the place of supply rules, available at: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-place-supply.html
In participating provinces, the Goods and Services Tax (GST) and the Provincial Sales Tax (PSTPST) have been replaced by the Harmonized Sales Tax (HST). In the remaining provinces and territories, GST is imposed on taxable goods and services. There may also be a provincial sales tax or a retail sales tax in place for which the government may or may not be exempt. For the list of participating provinces, and the current GST or HST rates for each province and territory, the legal agent should refer to https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-which-rate.html. For additional information, the legal agent should consult https://www.canada.ca/en/revenue-agency/corporate/contact-information.html.
It is the sole responsibility of the legal agent to charge taxes in accordance with applicable legislation.
15. Review of Agent Accounts
The Department is responsible for taxing all legal agent accounts before payment is made. Taxation involves examining the account to ensure that it is accurate and complete, and ensure that fees and disbursements are reasonable for the services rendered and billed in accordance with the mandate, the letter of appointment, and these Terms and Conditions.
Where the Department identifies problems with the services or the account, instructing counsel will notify the legal agent as soon as possible upon receipt of the account, advising what amounts need to be corrected, adjusted or placed on hold pending clarification or supporting information from the legal agent, and the reasons.
16. Payment
16.1 Thirty Day Payment Period
As stipulated in the Treasury Board Directive on Payments, Canada’s standard payment period is thirty (30) days. The payment period is measured from the date an agent account is received in acceptable form and content. A payment is considered overdue on the 31st day following that date and interest will be paid automatically in accordance with Section 16.2, below. Where the legal agent account requires correction, adjustment or supporting information, the 30-day payment period re-commences upon receipt of the revised account or the replacement or corrected work.
16.2 Interest on Overdue Accounts
Canada will pay to the legal agent simple interest at the Average Rate plus 3 percent per year on any amount that is overdue, from the date that amount becomes overdue until the day before the date of payment, inclusive. The legal agent is not required to provide notice to the Department for interest to be payable.
Canada will pay interest in accordance with this section only if Canada is responsible for the delay in paying the legal agent.
For the purpose of this section:
- "Average Rate" means the simple arithmetic mean of the Bank Rates in effect at 4:00 p.m. Eastern Time each day during the calendar month immediately before the calendar month in which payment is made;
- "Bank Rate" means the rate of interest established from time to time by the Bank of Canada as the minimum rate at which the Bank of Canada makes short term advances to members of the Canadian Payments Association;
- "date of payment" means the date of the negotiable instrument drawn by the Receiver General for Canada to pay any amount under the letter of appointment; and,
- "overdue" means when an amount is unpaid on the first day following the day on which it is due and payable according to these terms and conditions.
16.3 Overdue Accounts
The legal agent must direct any inquiries regarding the status of payment of an account to the instructing counsel.
17. Legal Agent Performance
17.1 Performance Assessment
The Department may conduct periodic performance assessments of the legal agent’s activities. The review may have an influence on the continuation of an existing appointment as well as on opportunities to be considered for prospective appointments. The instructing counsel or another representative of the Department may communicate periodically with the legal agent to discuss performance, seek details and clarification that relate to satisfaction with service, price and results.
The Department may define specific assessment criteria in the letter of appointment and/or statement of work, or through instructions provided during the tenure of the appointment.
18. Terminating the Appointment
A legal agent appointment is at the pleasure of the AGC. It can be terminated at any time without prior notice.
If the legal agent made a false declaration in its submission or makes a false declaration under the appointment, such false declaration may result in a termination under these Terms and Conditions. If the legal agent becomes bankrupt or insolvent, the Department may immediately terminate the appointment.
Where the Department chooses to terminate the appointment due to the legal agent’s performance, the Department may reduce or disallow an account, initiate a complaint before the appropriate Law Society, or initiate a civil action against the legal agent, depending on the circumstances.
Upon termination of the appointment, instructing counsel may require the legal agent to deliver to the Department, in the manner and to the extent directed by the instructing counsel, any completed parts of the work, not delivered before the termination notice was received.
19. Audits
19.1 Audit of Compliance
The Department may conduct audits of all records created and maintained by the legal agent in the course of the appointment to monitor compliance with the letter of appointment and these Terms and Conditions. The legal agent must comply fully with any audits.
19.2 Financial Audits
The legal agent must keep proper accounts and records of the cost of performing the work and of all expenditures or commitments made by the legal agent in connection with the work, including all accounts, receipts and vouchers.
If the terms of appointment include payment for time spent by the legal agent, its employees, representatives, or subcontractors performing the work, the legal agent must keep a record of the actual time spent each day by each individual performing any part of the work.
Unless the Department has consented in writing to its disposal, the legal agent must retain all the information described in this section for six (6) years after it receives the final payment under the appointment, or until the settlement of all outstanding claims and disputes, whichever is later.
During this time, the legal agent must make this information available for audit, inspection and examination by the representatives of Canada, who may make copies and take extracts. The legal agent must provide all reasonably required facilities for any audit and inspection and must furnish all the information as the representatives of Canada may from time to time require to perform a complete audit.
The amount claimed under the appointment, calculated in accordance with the remuneration provisions in the letter of appointment, is subject to government audit both before and after payment is made. If an audit is performed after payment, the legal agent agrees to repay any overpayment immediately on demand by Canada. Canada may hold back, deduct and set off any credits owing and unpaid under this section from any money that Canada owes to the legal agent at any time (including under other appointments). If Canada does not choose to exercise this right at any given time, Canada does not lose this right.
20. Dispute Resolution
In the event of a disagreement regarding any aspect of the work, any instructions given under the appointment, any contractual issues or any billings, the parties agree to attempt to resolve the dispute through negotiations or other mutually agreeable dispute resolution process.
All information exchanged during the negotiations or any subsequent dispute resolution process will be regarded as ‘without prejudice’ communications for the purpose of settlement negotiations and must be treated as confidential by the parties and their representatives, unless otherwise required by law. However, evidence that is independently admissible or discoverable will not be rendered inadmissible or non-discoverable by virtue of its use during the negotiations or other dispute resolution process.
21. Notice
Any notice under the appointment must be in writing and may be delivered by hand, courier, mail, facsimile or other electronic method that provides a paper record of the text of the notice. It must be sent to the party for whom it is intended at the address stated in the letter of appointment. Any notice must be effective on the day it is received at that address. Any notice to Canada must be delivered to the instructing counsel.
22. Survival
All the parties’ obligations of confidentiality, representations and warranties set out in the letter of appointment and these Terms and Conditions as well as the provisions, which by the nature of the rights or obligations might reasonably be expected to survive, will survive the expiry or termination of the appointment.
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