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Compensation Fund

The Compensation Fund helps those who have lost money because of the dishonesty of a lawyer or paralegal licensed by the Law Society of Ontario. It is funded by the fees that lawyers and paralegals pay annually. Over the years it has assisted many clients.

The Compensation Fund is the last resort. You must try to recover the loss from the lawyer or paralegal directly and from any other sources including insurance or others who may be responsible for the loss. See "What other steps can I take to try to recover the funds?".

You must notify the Law Society in writing about your loss within six months from the time you first learn of the loss. In some cases, the Law Society may decide to extend this six-month period up to two years, but the granting of an extension is not guaranteed and should not be relied upon.

  • Who can apply for reimbursement?

    You may apply if you have lost money due to your lawyer’s or paralegal's dishonesty, in connection with their law or legal services practice.

    Before you apply, read the information on this page about the kind of losses that are covered.

    Claimants need not be Canadian citizens. Eligible claimants include trusts and estates. The Compensation Fund does not pay grants to banks or financial institutions in the business of lending money.

    The fund only deals with claims involving the conduct of lawyers and paralegals licensed by the Law Society of Ontario. For example, if you gave money to a Winnipeg lawyer for the purchase of a home in Manitoba, you will need to apply to the Law Society of Manitoba for compensation.

  • What kinds of losses may be covered?

    If you have lost money due to a lawyer or paralegal's dishonesty, the Compensation Fund can reimburse you for all or part of your loss. Typically, the fund will pay for losses involving money from estates, from trust funds held for real estate closings and from settlements in legal actions.

    The loss must arise in connection with the lawyer's or paralegal's authorized practice. To qualify, claimants must be able to show that the money or property was transferred to the lawyer or paralegal.

    Fees paid to a lawyer or paralegal may be reimbursed only after it is determined that few or no useful services were provided and if there is evidence of dishonesty.

    If you believe that the fees charged by your lawyer or paralegal were too high, please refer to Complaints about legal fees.

  • What kinds of losses are not covered

    The Compensation Fund doesn't reimburse in cases dealing with negligence, except in special circumstances where a lawyer has intentionally:

    • failed to report a claim at all or in a timely fashion to the professional liability insurer (LAWPRO), or
    • failed to cooperate with LAWPRO in accordance with the insurance policy’s terms and conditions,


    with the intent of preventing you from obtaining compensation from LAWPRO, resulting in no insurance payment. In such cases, the lawyer’s conduct will be considered dishonest — thereby making the clients eligible to apply to the Compensation Fund for compensation.

    Note: paralegals are not insured by LAWPRO.

    Learn how to make a complaint regarding negligence and other matters. 

    Losses on mortgage investments caused by a decline in real estate values are not compensated.

    Losses arising out of a business venture between a lawyer or paralegal and a client are also not covered.
    The fund will not compensate clients in situations where the lawyer or paralegal has failed to repay a loan given by a client who knew it was for personal use.

    Reimbursement is limited to the actual amount taken by the lawyer or paralegal. It does not include damages, expenses incurred or lost interest. For example, if a lawyer or paralegal takes money that should have been used to prevent a foreclosure on a home, the fund can reimburse you for the lost money but not the lost house.

    The fund only deals with claims involving the conduct of lawyers and paralegals licensed by the Law Society of Ontario. For example, if you gave money to a Winnipeg lawyer for the purchase of a home in Manitoba, you will need to apply to the Law Society of Manitoba for compensation.

Making a Compensation Fund claim 

  • How do I file a claim?

    After reviewing the information above, if you think your claim is one that the Compensation Fund may consider, complete and submit a request form. 

    We will review your claim. If your claim appears to be the kind of loss that is covered by the fund, we will ask you to set up an account on LSO Connects, the Law Society’s secure communication channel.

    LSO Connects is where all communications pertaining to your claim will take place.

    You will be asked to provide further information and to upload documents that support your claim.

    There is no application fee and you do not need to be represented by a lawyer or paralegal, although many claimants choose to be, particularly in difficult or complicated claims.

  • What happens next?

    If your claim appears to be the kind of loss that is covered by the Compensation Fund, a lawyer from the Law Society will be assigned to the case. 

  • Who decides whether a claim will be paid?

    The Compensation Fund Sub-Committee is a standing committee of the Law Society's Board of Directors (Convocation). For claims under $5,000, Law Society staff will decide whether to pay the claim and how much to pay.

    The Sub-Committee considers claims over $5,000 and decides whether to pay the claim and how much to pay.

    To help guide their decisions, Law Society staff and the Compensation Fund Sub-Committee refer to a set of Claim Guidelines.

    You may find it helpful to read the guidelines as they include information about the prerequisites that must be met before a claim may be paid and factors that may affect the amount to be reimbursed.

  • How long does the claims process take?

    The entire process may take 12 to 24 months or more.

    There are several reasons why the review of a claim may be delayed.

    1. Reimbursement from the Compensation Fund depends on proof of dishonesty. This means that disciplinary proceedings taken against the lawyer or paralegal involved may need to be completed before a claim is considered.
    2. Some time is required to ensure that the client has explored all other reasonable avenues to recover the funds.
    3. Many applications are submitted to the fund without sufficient supporting documentation. This can result in delays while additional information is sought. It is important to include as much information as possible at the outset to assist the Law Society staff who are reviewing your claim.
    4. The number of claims that are being assessed at any given time and their degree of complexity. 
  • What other steps can I take to try to recover the funds?

    The Compensation Fund is the last resort. You must try to recover the loss from the lawyer or paralegal directly and from any other sources including insurance or the lawyer's or paralegal's partners.

    However, notice of a claim should be filed with the fund within the time limit. The Compensation Fund staff will determine whether all reasonable steps have been taken to recover the funds from other sources.

    If a claim suggests criminal conduct on the part of the lawyer or paralegal, the fund will require you to explain whether or not you have contacted the relevant police authority. Please refer to the process for reporting criminal or illegal activity.

    As the Law Society cannot provide legal advice, you may wish to consult another lawyer or paralegal. There are deadlines for starting legal actions, so it is best not to delay.

    If you have a complaint about a lawyer or paralegal, please refer to the Complaints section.

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