Neutral Citation: 2010 ONFSCDRS 24 FSCO A08-001332

BETWEEN:

ANDREW J. PUNWASIE Applicant

and

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY Insurer

DECISION ON A MOTION

Before: Arbitrator John Wilson Heard: October 25, 2009, by teleconference

Appearances: Mr. Punwasie on his own behalf Rameshwer Sangha for himself as moving party Darrell March for State Farm Mutual Automobile Insurance Company

Issues:

The Applicant, Andrew J. Punwasie, was injured in a motor vehicle accident on October 10, 2003. He applied for and received statutory accident benefits from State Farm Mutual Automobile Insurance Company (“State Farm”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Mr. Punwasie applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

Mr. Punwasie’s claims went to an arbitration hearing on February 20, 2009. In a decision dated April 14, 2009, I found that Mr. Punwasie was barred from proceeding to a hearing on his substantive claims by reason of an inordinate delay that went beyond the statutory limitation contained in section 51(1) of the Schedule.

Subsequent to the delivery of the decision in this matter, but prior to any decision on the issue of expenses, Mr. Sangha advised that he wished to be removed as solicitor of record.

The issue to be decided is:

Is Mr Sangha permitted to withdraw as counsel of record for Mr. Punwasie?

Result:

Mr. Sangha is permitted to withdraw as counsel of record.

EVIDENCE AND ANALYSIS:

This is a scenario that repeats itself not infrequently in this forum, and one that raises challenges both for the integrity of the arbitration process, and the protection of the confidences arising from the solicitor-client relationship.

Mr. Sangha, who shepherded Mr. Punwasie’s claim through the hearing process now wants out, alleging that there is no longer a requisite level of trust and confidence between solicitor and client. Mr. Punwasie, quite understandably wants Mr. Sangha to finish up the process and remain on the file long enough to deal with the remaining expense issue.

Mr. March, on behalf of his insurer client, has a limited interest in whether or not Mr. Sangha remains as counsel, if only from the point of view of avoiding further delay in completing the last part of the hearing process. I note, specifically that State Farm has never put Mr. Sangha on notice that it would hold him responsible for all or part of any award of expenses incurred in the arbitration process.

The withdrawal of counsel as solicitor of record in an arbitration is framed both by the common law, the ethical obligations of a solicitor to his client, and in the case of this arbitration by procedural rules contained in the Dispute Resolution Practice Code (the “Code”).

Rule 9.8 of the Code provides:

Where the party represented provides written consent to the representative’s request for withdrawal, the Registrar or an adjudicator shall permit the representative’s withdrawal. Otherwise, an adjudicator may permit the representative to withdraw, subject to such terms as the adjudicator considers just.

Although the Code does not deal directly with the circumstances in which a representative should be permitted to withdraw, both the common law and the Rules of Professional Conduct (“Rules”) issued by the Law Society of Upper Canada provide some guidance.

While most jurisprudence relating to solicitors of record comes out of the criminal sphere, there is no reason that the fundamental principles in those cases may not be applied to civil matters. Fish J.A., speaking for the Quebec Court of Appeal, considered some of the policy questions involved in the withdrawal of counsel during a proceeding:

Permission to withdraw at the outset or in the course of a trial is not lightly granted by the courts. Withdrawal will normally be permitted only where counsel and client are irreconcilable. So fundamental is the disagreement, that counsel is presumed incapable of properly representing the accused.²

Likewise in Ontario, the Courts have observed:

The mantle of solicitor of record may not be discarded except in accordance with the Rules of Civil Procedure. The client may deliver a notice of intention to act in person, pursuant to rule 15.03(3), or a notice of change of solicitors, pursuant to rule 15.03(1), or the solicitor of record may move under rule 15.04 for an order removing him as solicitor of record. Until a notice permitted by rule 15.03(1) or (3) is delivered, the responsibility remains with the solicitor of record. While the solicitor of record may expect to be served with one of the two notices, it is up to him to monitor the situation and, in the absence of such a notice, to move for an order in a timely fashion.³

In civil matters, as opposed to criminal matters, Rule 2.09 of the Law Society’s Rules of Professional Conduct makes it clear that a lawyer may withdraw from representing a client for just cause. The rule includes as justifiable cause a loss of confidence, deception by the client, the failure to pay fees, or the refusal of a client to accept and act upon the lawyer’s advice on a significant point.

The Commentary on Rule 2.09 states:

No hard and fast rules can be laid down about what will constitute reasonable notice before withdrawal. Where the matter is covered by statutory provisions or rules of court, these will govern. In other situations, the governing principle is that the lawyer should protect the client’s interests to the best of the lawyer’s ability and should not desert the client at a critical stage of a matter or at a time when withdrawal would put the client in a position of disadvantage or peril.

While the lawyer should protect the client’s interests, it is not at all clear that a refusal to grant an order removing Mr. Sangha as counsel, as urged by Mr. Punwasie, would be an appropriate way of addressing this problem. Granted, Mr. Punwasie wants Mr. Sangha to remain, presumably to finish this matter promptly and avoid appearing unrepresented at the expense hearing yet to come in this matter. Notwithstanding Mr. Punwasie’s expressed wish, it is clear even from his own comments that there is now an element of anger and distrust affecting his relations with Mr. Sangha. Master Dash commented in a similar situation:

The test is not whether the client wants the solicitor to continue to act for him. The test is whether there has been such loss of confidence that justifies the solicitor’s withdrawal. In my view it is obvious that the solicitor-client relationship has broken down. Mr. Nicolardi does not have confidence in Davis’s competence, integrity or opinion. It was reasonable for Davis to ask to withdraw. It is asking the impossible of the solicitor to continue to represent a client in light of such criticism about the services that he has provided.⁴

In R. v. Leask⁵, the British Columbia Supreme Court was asked for an order prohibiting a provincial court judge from ordering a lawyer to continue as counsel in a criminal matter. McKay, J. in his decision stated unequivocally:

The issue is whether a trial judge has any right in law to order counsel to continue in the defence of an accused after counsel advises that he has decided that he will no longer represent the accused. In my view the law is clear that he cannot make such an order. I had never heard it suggested otherwise until I read the remarks of Judge Cronin. A judge can, of course, urge counsel to reconsider and to try to reconcile any differences with his client — but if counsel stands firm then he cannot be prevented from withdrawing. It follows that counsel cannot properly be cited for contempt for refusing to comply with that unlawful order.

In R. v. Zukerman⁶, MacDonnell Prov. Div. J. examined the approach taken in Leask and other cases:

Mr. Gans also made reference to the decision of the Quebec Court of Appeal in R. v. Steele (1991), 1991 CanLII 3882 (QC CA), 63 C.C.C. (3d) 149. In that case, counsel for an accused charged with murder applied at the outset of trial for leave to withdraw on the basis that he had been discharged by his client. The trial judge allowed him to withdraw as counsel, but ordered him to remain to "assist" the accused during the trial. The Court of Appeal held that the trial judge erred in making that order. The facts of R. v. Steele were quite unlike those of the present application, but one comment made by Fish J.A., speaking for the Court of Appeal, is directly relevant to this case. He stated at p. 160:

Permission to withdraw at the outset or in the course of a trial is not lightly granted by the courts. Withdrawal will normally be permitted only where counsel and client are irreconcilable. So fundamental is the disagreement, that counsel is presumed incapable of properly representing the accused.

Unlike McKay J. in Leask, the Quebec Court of Appeal considered that a trial judge has a role to play in determining whether counsel should be permitted to withdraw at the outset or in the midst of a trial. The jurisprudence in Ontario leans towards the view expressed by Fish J. and rejects the position taken by McKay J. in Leask, supra.

Hill J. in R. v. Downey⁷, while accepting some elements of Leask, summarized the law in Ontario on the removal of counsel as follows:

A client can discharge counsel at any time and defend him or herself…A lawyer, once retained, does not enjoy the same freedom of action:

The court entertains supervisory jurisdiction, apart from rules of court, as an aspect of its inherent jurisdiction to control its own process and to deal with officers of the court in matters affecting the administration of justice. Counsel appearing before the court owes duties to the court quite apart from any duty owed to a client or the profession or the public:

Rules 2.09(2) and 2.09(7) of the Rules of the Law Society of Upper Canada; Rule 25 of the Rules Respecting Criminal Proceedings in the Superior Court of Justice; suggest that counsel, once retained in a criminal case, and having appeared before the court is obligated to the court to continue to do so unless, after notice to the client, the court permits counsel to withdraw for cause or by reason of the client’s termination of the relationship. In other words there is no absolute right to withdraw.⁸ This obligation to the court is independent of his obligations to others including the client.

Fish, J. A. in Steel (supra) specifically relied upon the comments of the court in R. c. Poulin (C.A.Q. 200-10-000220-884, which viewed such an order as a violation of the constitutional rights of an accused. The court in Poulin stated:

La décision du juge a eu pour effet d’imposer à l’appelant un avocat qu’il avait désavoué. Elle a eu pour effet aussi d’obliger l’avocat à agir contre son gré, sachant qu’il avait des motifs raisonnables de se retirer.⁹

In this matter, of course it is the party who wishes to keep his lawyer. He does not want to change horses in mid stream. He simply wants him to finish the job, and have competent legal assistance in addressing the remaining expense issue.

While the majority of the cases discussed in relation to the discharge of counsel involve the actions of counsel in criminal matters where the absence of counsel can affect the liberty of an individual, it is not at all clear that the same general principles cannot also be transposed to other tribunals where issues of great importance to an individual are being decided.

In this context it is important to note that the principle expressed in the Rules of Professional Conduct that a lawyer: “should not desert the client at a critical stage of a matter or at a time when withdrawal would put the client in a position of disadvantage or peril” is not restricted to the criminal sphere. In this matter Mr. Punwasie, having lost on the preliminary issue is at risk of a serious expense award.

I agree with P. Tetley J. that a judge or an adjudicator who has control of a process has authority under certain circumstances to make an order that counsel remain on the record, and that the hard line taken in the British Columbia cases does not extend to Ontario.

Even in Circumstances involving considerations of mandatory withdrawal, trial judges in Ontario may, in the appropriate case, decline to accept the unilateral determination of a lawyer that he or she should withdraw from the case, particularly when that request arises during the course of a trial: See Justice MacDonnell’s comments at page 5 of the R. v. Zuckerman [1992] O.J. No. 2303 (Ont. Prov. Ct.) decision, Justice Hill’s commentary on the same issue referenced in pages 22 to 28 in the Downey case, and the distinguishing of the case submitted on behalf of Mr. Irving by Mr. Searles, the British Columbia Supreme Court decision of Justice McKay in R. v. Leask and Cronin (1985), 1985 CanLII 586 (BC SC), 18 C.C.C. (3d) 315 (BCSC). I am content, based on the law as I understand it to have been applied and interpreted in Ontario, particularly by the decision of Justice Hill which is binding on me, that Leask and Cronin is distinguished, and not applicable in Ontario.¹⁰

While it is not always evident that arbitrators, as quasi-judicial adjudicators may exercise all the powers of a judge, I note that the withdrawal of counsel during the hearing process has been characterized as having elements of contempt.¹¹

Even without such an extreme characterization, the change of counsel, especially during the hearing of a matter can have serious effects on the process. It can result in serious delays while a party seeks replacement counsel. It can cause wasted preparation time, and cause confusion with the availability of witnesses. If not done for solid, unavoidable reasons, it can be unfair to parties, and potentially negatively impact the arbitration process.

The power to control abuse of process is a “power which any court of justice must possess to prevent misuse of its procedure in a way which, although not inconsistent with the literal application of its procedural rules, would nonetheless be manifestly unfair to a party to litigation before it, or would otherwise bring the administration of justice into disrepute among right-thinking people.”¹²

The legislative foundation for an adjudicator’s control of the process is found in section 23(1) of the Statutory Powers Procedure Act which provides that: “A tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes.” The improper withdrawal of counsel during a process could be just one such abuse.¹³

While there is a discretion in arbitrators to regulate the withdrawal of counsel of record in an arbitration proceeding before them, in this matter I am not convinced that it is a discretion that should be exercised.

It is clear that Mr. Sangha’s withdrawal at this stage in the arbitration has delayed somewhat the final stage of the arbitration, leaving Mr. Punwasie either to search for new counsel or to complete the arbitration process as an unrepresented party. That, in itself is not enough to justify ordering Mr. Sangha to stay.

Having witnessed the interactions between Mr. Punwasie and his former counsel, I am not convinced that any good can come of ordering Mr. Sangha to stay the course and remain as counsel.

It is apparent that for whatever reason that there is no mutual confidence, nor much trust remaining between Mr. Sangha and Mr. Punwasie. To order counsel under those circumstances to continue to represent a client who has little confidence in the lawyer, would make a mockery of the balance of the arbitration process. Even were Mr. Sangha to comport himself respectably in the balance of the arbitration, the appearances would remain unsettling.

Consequently, I accept that Mr. Sangha should be allowed to withdraw as counsel of record for Mr. Punwasie, and I so order. Since no specific conditions have been requested as a consequence of the withdrawal, I make the order without conditions. The order however is prospective. While Mr. Sangha is no longer responsible for the carriage of Mr. Punwasie’s action, it goes without saying that my order does not affect any responsibility Mr. Sangha may have for his actions as counsel until such time as he was discharged.

Mr. Punwasie may wish some further time to retain alternative counsel, in which case he should, immediately, write to the Commission with details of that request . Otherwise, State Farm may now proceed to request a date to deal with the balance of the expense issue.

EXPENSES:

Given the circumstances leading to this order, I decline to make any expense order relating to this motion.

March 4, 2010

John Wilson Arbitrator

Financial Services Commission of Ontario