Convocation's adoption of the report of the Special Committee on Compensation Fund in January 1953 represented a pioneering effort by the entire legal profession of Ontario to accept responsibility for the illegal activities of a minority of its members.
The issue of defaulting solicitors had been discussed as early as 1933, when Convocation struck a special committee to investigate the subject. In that year, the committee concluded that a compensation scheme "neither would be wise or practicable." The committee cited several objections: such a plan would benefit the untrustworthy solicitor at the expense of those entitled to confidence; it would bring about the novel result that honest solicitors would pay for the defaults of the honest; and it would impose a burden on solicitors, particularly those starting in practice.
In 1951, the issue re-surfaced and a special committee was appointed with J.J. Robinette as chair. At its report to Convocation in Jan. 1953, the committee expressed the view that "the most effective method to protect the public and at the same time to advance the welfare of the profession lies in … the stern exclusion from membership in the Society of those who have proven themselves to be unworthy of confidence."
Nevertheless, the committee recommended "that the Society should adopt some method whereby members of the public may be compensated in some degree on those infrequent occasions when a client suffers actual monetary loss as the direct result of the dishonesty of a solicitor." The committee concluded that such a scheme would protect the public and advance the collective interests of the profession. The scheme adopted was modeled on an English fund that had been established in 1941.
Over the years the compensation fund has paid out millions of dollars to help clients who have lost money because of a lawyer's dishonesty.