Court File and Parties
DIVISIONAL COURT FILE NO.: 552/24
SUPERIOR COURT OF JUSTICE – ONTARIO
DIVISIONAL COURT
RE: THE LAW OFFICE OF SACK (Q.C.) AND BOGLE LAW PROFESSIONAL CORPORATION, Appellant
AND: amir fakroldin rahimi, Respondent
BEFORE: Matheson J.
COUNSEL: Self-represented Appellant
Gregory Govedaris, for the Respondent
HEARD at Toronto: March 24, 2025, by video-conference
ENDORSEMENT
[1]
Background
The appellant law firm appeals the decision of Associate Justice Jolley dated August 8, 2024 (the Decision), dismissing its motion for a charging order against the respondent/former client. The appellant had sought an order under s. 34 of the Solicitor’s Act, R.S.O. 1990, c. S.15. That section provides as follows:
34 (1) Where a solicitor has been employed to prosecute or defend a proceeding in the Superior Court of Justice, the court may, on motion, declare the solicitor to be entitled to a charge on the property recovered or preserved through the instrumentality of the solicitor for the solicitor’s fees, costs, charges and disbursements in the proceeding.
2The appellant had represented the respondent in a civil action alleging fraud against numerous defendants in connection with renovation work in the plaintiff’s home. The respondent was named as one of the many defendants in the civil action and was subject to an ex parte mareva injunction granted by Justice Merritt on March 10, 2023. That injunction froze each of the defendant’s assets on terms, including the respondent’s bank account referred to below.
3The respondent, represented by the appellant, took steps in the civil proceedings to lift the mareva injunction as against him. A series of orders were made regarding the mareva injunction. On this appeal, the appellant relies primarily on the March 31, 2023 order of Justice Papageorgiou. Justice Papageorgiou held that the respondent’s request to lift the injunction was premature. She ordered that the respondent could access $10,000 from his bank account for living expenses, legal advice and representation, as contemplated by the terms of the original mareva order. On May 12, 2023, Justice Koehnen again refused to lift the mareva as against the respondent.
4After May 12, the respondent switched counsel. The respondent settled with the plaintiff later in the year.
5The appellant rendered an account in July 2023, for services rendered, for more than $100,000. Before this Court, the appellant has made submissions about the positive work that was done for the respondent. The respondent strongly disagrees.
6The appellant moved for a charging order against the respondent’s bank account. The appellant submits that its efforts resulted in the unfreezing of the bank account even though the order replied on only permitted $10,000 for uses contemplated by the original mareva injunction.
7The motion judge considered the above submission and held that even if the bank account should be treated as funds recovered or preserved under s. 34, it was not recovered or preserved through the instrumentality of the appellant. The original mareva order had contemplated the release of funds for living expenses, legal advice and representation, and the respondent was given access to $10,000 in his bank account for those purposes. Further, the appellant did not create any funds (e.g., the respondent did not receive any funds as a result of the action). After the new counsel was retained, the action was dismissed as against him without costs.
8The motion judge declined to exercise her discretion to grant the charging order. She concluded that there were no funds created or recovered by the efforts of the appellant. The motion judge awarded the respondent – the successful party – $5,000 for costs of the motion.
9On this appeal, the appellant submits that the motion judge erred as follows:
(i) in her application of s. 34 of the Solicitor’s Act; and,
(ii) in awarding costs to the respondent on the motion.
[10]
Standard of Review
The appellate standard of review applies, as set out in Housen v. Nikolaisen, [2002] 2 S.C.R. 235, 2002 SCC 33.
[11]
Analysis
On the first issue, the appellant relies on case law, submitting that it shows principles that were not adequately considered by the motion judge. The appellant also relies on s. 34(3), which permits a solicitor’s bill to be paid directly from received or preserved property.
12On the requirements of s. 34, the appellant submits that the respondent’s bank account is the property they claim a charging order against. The key issue is instrumentality. In addition to the order permitting the release of $10,000 for uses contemplated in the original mareva injunction, the appellant submits that steps they took during their retainer assisted in the ultimate dismissal of the claim against the respondent afterward.
13The cases relied upon by the appellant underscore that s. 34 of the Act gives the court a broad discretion regarding whether or not to grant a charging order: e.g., Taylor v. Taylor, 2002 ONCA 44981. This general principle does not assist the appellant. The appellant submits that the cases also show that the court must balance the equities including the impact on the appellant’s ability to be paid.
14Having considered the appellant’s submissions and cases, I am not persuaded that the motion judge erred in the Decision, on the contrary. The motion judge considered the correct legal principles and declined to exercise her discretion to grant a charging order. With respect to the release of $10,000, the motion judge gave the appellant the benefit of the doubt regarding whether the bank account could be property under s. 34 and was still not prepared to exercise her discretion in favour of a charging order. On the submission about taking useful steps toward the ultimate dismissal of the claim, that dismissal did not result in the payment of funds to the appellant, as noted by the motion judge. This ground of appeal is unsuccessful.
[15]
Costs of the Motion
Although not the subject of oral submissions, the appellant also argues that the motion judge erred in her costs order. The appellant agrees that costs are discretionary but submits that the motion judge may not have sufficiently weighed the legal and factual disputes at issue on the motion. I do not find an error in the costs decision that results in a successful appeal on costs. The motion judge granted costs to the successful party and did not make a reviewable error in exercising her discretion to do so.
[16]
Disposition
This appeal is dismissed with costs fixed at the agreed amount of $5,000, all inclusive.
Matheson J.
Date: March 25, 2025