Court File and Parties

CITATION: Morse Shannon LLP v. Fancy Barristers P.C., 2017 ONSC 2135

COURT FILE NO.: DC-604/16

DATE: 20170410

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: MORSE SHANNON LLP, Plaintiff (Responding Party)

AND:

FANCY BARRISTERS P.C. and HASSAN FANCY, Defendants (Moving Parties)

BEFORE: MARROCCO A.C.J.S.C.

COUNSEL: Jerome R. Morse and David Trafford, for the Plaintiff (Responding Party) Hassan A. Fancy, for the Defendants (Moving Parties)

HEARD: IN WRITING

leave to appeal ENDORSEMENT

[1] The moving parties, Fancy Barristers P.C. and Hassan Fancy (collectively “Fancy”), move for an order granting leave to appeal the order of the Case Management Judge, dated January 9, 2017, dismissing Fancy’s motion that the Case Management Judge recuse herself and requiring Fancy to pay costs resulting from the dismissal of the recusal motion on a full indemnity scale, for reasons given December 6, 2016.

[2] Two minor plaintiffs contingently retained Fancy in two separate actions: a medical negligence action and a motor vehicle injury action. Fancy retained the services of the responding party, Morse Shannon LLP (“Morse Shannon”), to assist in prosecuting the two actions.

[3] Fancy, after some time, dismissed Morse Shannon and refused to reimburse or undertake to reimburse from any potential recovery Morse Shannon’s docketed time and disbursements. Morse Shannon applied for and obtained from the Case Management Judge pursuant to s. 34 of the Solicitors Act, R.S.O. 1990, c. S.15 two orders charging the funds recovered in each of the two actions. Morse Shannon also commenced two actions seeking payment of the disbursements and declarations of entitlement to certain amounts for fees, which actions continued to be case managed by the Case Management Judge following the granting of the charging orders.

[4] Fancy initiated an appeal of the Case Management Judge’s decision to issue the charging orders to the Court of Appeal. Fancy also submitted to the Case Management Judge that she was biased and requested that she recuse herself as the case management judge on the actions. The Case Management Judge viewed these allegations as groundless and dismissed the recusal motion brought by Fancy. Fancy also raised bias on the part of the Case Management Judge on the appeal of the charging orders to the Court of Appeal. The Court of Appeal dismissed Fancy’s appeal, on that and other grounds, and ordered Fancy to pay $14,000 in costs.

[5] The Case Management Judge’s decision refusing to recuse herself is an interlocutory decision. An appeal lies to the Divisional Court from an interlocutory order of a judge of the Superior Court, only with leave of a different judge of the Superior Court: see s. 19(1)(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43.

[6] The test for leave to appeal an interlocutory order is well known. Leave to appeal shall not be granted unless there is a conflicting decision and it is desirable that leave to appeal be granted or there is good reason to doubt the correctness of the order in question and the proposed appeal involves matters of such importance that leave to appeal should be granted. An appeal involves matters of such importance that leave to appeal should be granted if it raises questions of broad significance or general application that warrant resolution by a higher court, because they affect the development of the law and the administration of justice. See Rules of Civil Procedure, R.R.O. Reg. 194, Rule 62.02(04); Ash vs. Lloyd’s Corp. (1992), 8 O.R. (3d) 282, (Gen. Div.); Greslik v. Ontario Legal Aid Plan (1988), (ON SCDC), 65 O.R. (2d) 110, 30 O.A.C. 33 (Div. Ct.).

[7] There are no decision that conflict with the Case Management Judge’s decision.

[8] The Court of Appeal has confirmed that the claim of bias is unfounded, so the issue of bias cannot be a basis for finding that the proposed appeal is important. See Fancy Barristers P.C. v. Morse Shannon LLP, 2017 ONCA 82, [2017] O.J. No. 517. The Case Management Judge’s decision not to recuse herself is case-specific and does not have broad application, even if there were some question about the correctness of the recusal decision, which there is not.

[9] Accordingly, leave to appeal the Case Management Judge’s refusal to recuse herself is refused.

[10] Fancy also moves for leave to appeal the Case Management Judge’s order that Fancy pay $32,681.83 for costs of the unsuccessful recusal motion.

[11] An appeal to the Divisional Court in which the sole issue is a discretionary decision to award costs requires leave of a judge of the Divisional Court: Courts of Justice Act, s. 133(b). The Supreme Court of Canada has held that an appellate court should interfere with a discretionary costs order only where there is an error in principle or the costs award is plainly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 27. Accordingly, leave to appeal a costs order is granted only in cases where there are strong grounds to believe that the judge erred in principle or was plainly wrong in the exercise of his or her discretion. See McNaughton Automotive Limited v. Co-operators General Insurance Company, 2008 ONCA 597, 298 D.L.R. (4th) 86, at para. 23.

[12] The Case Management Judge set out the reasons for the costs award in a decision dated December 6, 2016. In those reasons, Her Honour indicated that she was aware of the factors in Rule 57.01 that should be considered when fixing the quantum of costs. Her Honour specifically commented that the motion for recusal was ill-conceived and ultimately unsubstantiated. That conclusion was available on the evidence or perhaps, more precisely, the lack of evidence. In addition, as the Case Management Judge mentioned, the issue of bias was not raised at the time that the Case Management Judge was appointed to manage the case, despite the fact Fancy claimed the evidence of bias related to conduct that had occurred in 2005 and of which he was aware at that time. In fact, bias was first put forward by Fancy after the Case Management Judge had issued and finalized the charging orders. The Court of Appeal decision conclusively confirms that the bias motion was meritless. The Case Management Judge was entitled to consider that Morse Shannon was required to respond to a meritless motion when considering how much Fancy should pay for bringing the motion.

[13] There is no error in principle in the Case Management Judge’s decision concerning costs.

[14] Further, the Case Management Judge was entitled to conclude that the hourly rates of and hours spent by Mr. Morse and Mr. Trafford were reasonable having regard to their experience at the Bar and the nature of the recusal motion. Accordingly, it has not been demonstrated that the costs award is plainly wrong.

[15] There is no basis for granting leave to appeal the Case Management Judge’s costs order.

[16] Accordingly, this motion for leave to appeal is dismissed in its entirety with costs.

[17] I am mindful that there is overlap between the issues on this unsuccessful leave to appeal motion and Fancy’s unsuccessful appeal to the Court of Appeal. Accordingly, Fancy Barristers P.C. and Hassan Fancy will pay Morse Shannon, forthwith, $5000 in total on account of costs inclusive of HST and disbursements. This costs obligation of Fancy Barristers P.C. and Hassan Fancy is joint and several.

MARROCCO A.C.J.S.C.

Date: 20170410