Traffic Law Advocate v. Guo Yang, 2013 ONSC 2887
CITATION: Traffic Law Advocate v. Guo Yang, 2013 ONSC 2887
DIVISIONAL COURT FILE NO.: DC-14/12
DATE: 2013/05/22
SUPERIOR COURT OF JUSTICE – ONTARIO
DIVISIONAL COURT
RE: Traffic Law Advocate (E.D) Professional Corporation, Plaintiff (Respondent)
AND:
Guo Yang, Defendant (Appellant)
BEFORE: Herman J.
COUNSEL: Miguel Maruszki, for the Plaintiff/Respondent
Guo Yang, appearing in person
HEARD: May 15, 2013
ENDORSEMENT
[1] The appellant, Mr. Yang, appeals from the decision of Deputy Judge Prattas of the Small Claims Court, dated December 7, 2011. The Deputy Judge granted judgment to the respondent, Traffic Law Advocate (E.E) Professional Corporation (“TLA”) in the amount of $772.06 and dismissed Mr. Yang’s claim.
[2] Mr. Yang has appealed on two grounds: (i) the Deputy Judge erred when he allowed TLA to amend its pleading to add the cause of action of quantum meruit; and (ii) the Deputy Judge applied the wrong hourly rate when he determined the amount Mr. Yang owed TLA.
Standard of Review
[3] The Supreme Court of Canada articulated the standard of review on appeals in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at paras. 8, 10, 25 and 36:
(i) on questions of pure law, the standard is correctness;
(ii) on findings of fact, the standard is palpable and overriding error; and
(iii) matters of mixed fact and law lie along a spectrum. Where there is an application of an incorrect standard, a failure to consider a required element of a legal test or similar error in principle, it is subject to a standard of correctness. However, where the issue involves the trial judge’s interpretation of the evidence, the standard is palpable and overriding error.
Amendment of TLA’s claim
[4] The Deputy Judge concluded that the contingency agreement between TLA and Mr. Yang was illegal. He relied on the holding in Koliniotis v. Tri Level Claims Consultants Ltd., [2005] O.J. No. 3381 (C.A.) that contingency fee arrangements with paralegals are prohibited in the absence of regulation of paralegals.
[5] During final argument, TLA moved to amend its claim to include quantum meruit as an alternative cause of action. The Deputy Judge requested and the parties provided written submissions on the issue.
[6] Mr. Yang does not dispute that a pleading may be amended at any point in a proceeding, absent prejudice. He also does not dispute that it is open to the court to apply quantum meruit if the contract between the parties is not legal.
[7] However, Mr. Yang submits that the Deputy Judge erred when he concluded that Mr. Yang would not suffer prejudice if the amendment were granted at that stage of the proceeding. His argument is that, had he known about the quantum meruit claim during the course of the trial, he would have presented more evidence and called more witnesses to show that the amounts charged by TLA were not justified or were unreasonable.
[8] The Deputy Judge disagreed with Mr. Yang’s submission in this regard:
The defendant had an opportunity and did question rather effectively the plaintiff on its Statement of Account pointing out several inconsistencies and omissions. However, the defendant did accept the entries and the amounts in this Statement up to November 15, 2007, which is the bulk of the work purported to have been done by TLAI.
There were no undisclosed facts presented at trial nor was the defendant deprived of the opportunity to meet and rebut the facts and the case of the plaintiff. There were no surprises for the defendant. An opportunity was given to the defendant to file opposing material on the amendment issue, which he did.
The defendant further argued that he was not enriched by the Plaintiff’s services, as alleged by the defendant, and pointed to the distinction in Grover [Grover v. Hodgins and Dorans, 2011 ONCA 72] between unjust enrichment for money and unjust enrichment for the provision of services; and between an incontrovertible benefit and one that was not directly bestowed on the recipient.
The plaintiff submitted further that all the evidence substantiating quantum meruit had been adduced and that the defendant would suffer no prejudice by the amendment. The defendant objected, submitting that he would need to call more witnesses to show that the amounts charged by the plaintiff were not justified or were unreasonable. But, once again, he accepted the entries up to November 15, 2007.
Both parties are obligated to present their best case at trial. They are not allowed to try a case by instalments. The defendant accepted all of the plaintiff’s charges up to November 15, 2011, which formed the bulk of the work. To disallow the amendment for the remaining $331.25 would be both disproportionate and unfair to both sides…
In addition, the defendant had already paid over two thousand dollars to the plaintiff and was not seeking the return of this money back. He was content with its payment, as no claim has been made for its return.
[9] It is clear from the above that the Deputy Judge considered Mr. Yang’s submissions on prejudice and concluded that the addition of the claim did not deprive Mr. Yang of any opportunity to meet and rebut the facts and the case of the plaintiff. The fact that Mr. Yang did, indeed, object to certain charges and services during the course of the trial, supports the Deputy Judge’s conclusion.
[10] Most importantly, the Deputy Judge found that Mr. Yang had accepted the entries up to November 15, 2007. Mr. Yang submits that the Deputy Judge misunderstood his evidence. He says he did not accept the amount or he only accepted the amount on the basis that he believed the contingency agreement with TLA was legal. However, without a transcript of the trial, which was not ordered, I have no basis upon which to conclude that the Deputy Judge made a palpable and overriding error in finding that Mr. Yang had accepted the amount.
[11] In reaching his conclusion, the Deputy Judge applied the correct legal principles. While Mr. Yang disagrees with the Deputy Judge’s findings on prejudice, I cannot conclude that the Deputy Judge made a palpable and overriding error in finding that Mr. Yang had a full opportunity to challenge TLA’s charges at trial and that Mr. Yang had accepted the charges up to a certain date.
Assessment of a reasonable fee for services
[12] Having found that TLA was entitled to be compensated and recover on a quantum meruit basis, the Deputy Judge considered what a reasonable fee for TLA’s services would be.
[13] Mr. Yang submits that the Deputy Judge improperly used an hourly rate of $200 per hour. In his submission, the appropriate hourly rate would be $100 per hour. In the result, instead of Mr. Yang owing TLA $772.06, TLA would owe Mr. Yang $720.85.
[14] The Deputy Judge’s conclusions as to the amount are as follows:
- Therefore, taking into consideration all the circumstances in this case, I accept on a balance of probabilities as reasonable compensation for the plaintiff on a quantum meruit basis the amount of $2,985.83, being the amount acceptable by both parties up to November 15, 2007. Any compensation subsequent to this date is contentious and I will not express any opinion. On a balance of probabilities I also accept the amount of $2,213.77 as being the amount already paid by the defendant to the plaintiff. I would therefore award the difference of $772.06 between these two figures to the plaintiff.
[15] Mr. Yang submits that the Deputy Judge just accepted TLA’s amount. However, that is not the case. The Deputy Judge accepted Mr. Yang’s version as to how much he had already paid TLA, not TLA’s version. Furthermore, the Deputy Judge did not award compensation to TLA for services after November 15, 2007.
[16] Mr. Yang contends that the Deputy Judge erred in law by not considering the appropriate factors in conducting a quantum meruit assessment. He points, for example, to the decision of Zipchen v. Bainbridge, 2008 SKCA 87, [2008] S.J. No. 407 (Sask. C.A.) at para. 90. The Saskatchewan Court of Appeal listed nine factors the court should consider in conducting a quantum meruit assessment, including the time and effort expended by the solicitor, the complexity and importance of the matter, the charges of other solicitors of the same standing at the bar, the amount of money involved and the results obtained.
[17] However, there was no need for the Deputy Judge to consider these various factors in the face of Mr. Yang’s acceptance of the amount of $2,985.83. Mr. Yang now says he did not accept the amount or he only accepted this amount because he believed the contingency agreement was legal. However, as noted above, I cannot conclude that the Deputy Judge made a palpable and overriding error in finding that Mr. Yang had accepted this amount, on the basis of the record before me.
[18] Finally, Mr. Yang submits that the Deputy Judge erred in applying an hourly rate of $200 instead of an hourly rate of $100, as was applied in the case of Koliniotis, at para. 41.
[19] There are three difficulties with this submission. Firstly, although the amount awarded by the Court of Appeal in Koliniotis, when divided by the number of hours of work, amounts to an hourly rate of $100, the Court expressly stated that it was “not in a position to express an opinion as to an appropriate hourly rate for a paralegal”.
[20] Secondly, the determination of reasonable compensation is case-specific. What is reasonable in one case is not necessarily reasonable in another.
[21] Finally, the Deputy Judge did not arrive at the amount of compensation on the basis of an hourly rate. Rather, the Deputy Judge arrived at the amount on the basis that Mr. Yang had accepted the amount at trial.
Conclusion
[22] In view of the above, I cannot conclude that the Deputy Judge erred with respect to the legal principles he applied in allowing the amendment to TLA’s claim and assessing a reasonable fee for TLA’s services. I also cannot conclude that the Deputy Judge made any palpable and overriding error in his findings with respect to prejudice and the determination of a reasonable fee.
[23] The appeal is therefore dismissed.
[24] I would encourage the parties to resolve the issue of costs. If they are unable to do so, TLA may provide written cost submissions within 14 days. Mr. Yang has a further 14 days within which to provide responding submissions. The submissions should not exceed 3 pages in length, plus a costs outline.
Herman J.
Date: May 22, 2013