The agreement would have awarded the Montreal law firm Arsenault, Dufresne and Wee, representing the plaintiffs, more than $8 million in fees.

Justice Thomas M Davis wrote in a 4 July decision that those fees were "excessive" and not in the interest of the more than 375 sexual-abuse victims who were part of the class action.

Davis says the firm did "remarkable work" and expects a new agreement with reasonable fees can be reached and resubmitted to the court.

The suit against the Quebec-based Catholic religious order the Clerics of St-Viateur involved acts committed between 1935 and the present day at more than 20 establishments run by the group, including boarding schools.

Read More