LAW SOCIETY TRIBUNAL
HEARING DIVISION
Tribunal File No.: 23H-061
BETWEEN:
Law Society of Ontario
Applicant
- and -
Monica Neeraj Goyal
Respondent
Before: Lubomir Poliacik (chair), Murray Klippenstein, Geneviève Painchaud
Heard: In writing
Appearances:
Sean Dewart, for the applicant
John A. Dent, for the respondent
Summary:
GOYAL – Costs – Having earlier determined that the Lawyer engaged in professional misconduct for her conduct in syndicated mortgage transactions, the panel considered the issue of costs – The panel noted the special consideration it gave to reducing the costs due to the responsible and co-operative conduct of the Lawyer and her counsel in the process – The parties agreed to an ASF and it, and other documents, was provided well in advance of the hearing – The panel was of the view that the effort and co-operation by the Lawyer should be recognized in a costs award significantly reduced from what it otherwise would be – The panel reduced the costs award from the $60,000 sought by the Law Society to $25,000.
REASONS FOR DECISION ON COSTS
1Murray Klippenstein (for the panel):– In our earlier reasons for decision in Law Society of Ontario v Goyal, 2025 ONLSTH 78, we found that the respondent Monica Neeraj Goyal (the Lawyer) engaged in professional misconduct in a matter involving a property redevelopment project funded by a syndicated mortgage. In that matter she represented 59 lenders who became her clients in the syndicated mortgage arrangement. All of the Lawyer’s lender clients lost their entire investment, totalling approximately $3,500,000, when the development plan eventually collapsed.
2The Lawyer had never previously acted on a syndicated mortgage transaction and was not familiar with such arrangements. We found that the Lawyer had comprehensively failed, in many ways, to serve her clients to the standard of a competent lawyer, although we found that the Lawyer’s conduct did not involve dishonesty.
3In our decision on penalty, we ordered a suspension of the Lawyer’s licence for six months; that the Lawyer refund the fees she had billed to her client lenders, in the sum of $50,000, as well as disbursements; that she take an additional 10 hours of Continuing Professional Development training in 2025 and 2026 in topics of ethics or professionalism; and that she be subject to a permanent practice restriction regarding syndicated mortgage matters.
4In those reasons we invited written submissions on the issue of costs, which were received. This is our order and reasons on costs.
5In particular, we note at the outset that we give special consideration below to reducing the costs award against the Lawyer from what the costs would otherwise have been, specifically due to the responsible and co-operative conduct of the Lawyer (and her counsel) in this process, which in the words used by a leading Tribunal decision on costs, “tended to shorten … the duration of the proceeding”: Law Society of Ontario v Perrelli, 2018 ONLSTH 80 at para 31. This is a factor that has long been a part of the Tribunal’s costs decisions, but it may be useful to highlight our application of that costs reduction principle in this case for the benefit of other future licensees who may be able to save themselves potentially significant amounts of costs at the end of the hearing by adopting various efficiency or co-operative measures early on in the process.
PRINCIPLES ON COSTS AWARDS AT THE TRIBUNAL
Authority to make costs awards
6The Law Society Act, RSO 1990, c L.8, provides that, subject to the rules of practice and procedure, costs are in the discretion of the Hearing Division.
7The Tribunal’s Rules of Practice and Procedure provide that costs may be awarded against a licensee, amongst other reasons, where a determination adverse to the licensee has been made.
Membership as a whole should not generally bear all disciplinary costs
8The leading and oft-cited authority on the rights of a regulatory body such as the Law Society Tribunal authorized by legislation to make disciplinary cost awards is the 2002 case of Aronov v Royal College of Dental Surgeons of Ontario, [2002] O.J. No. 5973. In that case the Discipline Committee of the College ordered a dental surgeon found guilty of professional misconduct to pay $21,000 in costs for the discipline hearing. On review, the Divisional Court quoted the Discipline Committee’s rationale and upheld the award:
The College had to prepare its case, prosecute Dr. Aronov and conduct the hearing regarding those allegations. It was agreed by the panel that there indeed is a cost associated with self-regulation, but that the membership should not have to bear all the costs associated with protecting the public interest against practitioners who choose not to adhere to the basic and fundamental precepts that are established by the teaching institutions and by the regulatory bodies to guide members of the profession and protect the public interest.
In the result, the Committee awarded about one-third of the costs claimed by the College. I can see no basis for interfering with the exercise of its discretion in this regard.
9That approach and general rationale was adopted by this Tribunal in Law Society of Upper Canada v Baker, 2006 ONLSHP 21, which states at para 12 that, “The financial burden for the prosecution of a member should not rest on the profession generally.”
10That approach has subsequently been repeatedly upheld by Ontario courts. The Ontario Court of Appeal in 2016 in Groia v The Law Society of Upper Canada, 2016 ONCA 471 at para 234 endorsed “the general rule that the reasonable costs of investigating and conducting a disciplinary proceeding should not be borne by the profession as a whole where a determination adverse to the defending lawyer has been made.” In Reid v College of Chiropractors of Ontario, 2016 ONCA 770, at para 24, citing Aronov, the Court of Appeal again endorsed the idea that such costs awards by a professional regulator “protect its members from the weight of the expense of protracted disciplinary hearings.”
11Similarly, in Walia v College of Veterinarians of Ontario, 2021 ONSC 4023 at para 31, the Divisional Court ruled:
… [A] factor in the award of costs is that the College must fund its expenses from the collection of fees from its membership. If the guilty party does not pay those costs, they must be recovered from the membership at large.
12However, while this principle has been repeatedly affirmed in Ontario, the Alberta Court of Appeal has adopted a different approach, stating that there is no presumption that costs of disciplinary proceedings should generally be borne by the overall membership of a profession or by the individual licensee in the proceeding: Charkhandeh v College of Dental Surgeons of Alberta, 2025 ABCA 258 at para 136.
13The Charkhandeh approach was recently put to the Tribunal’s Appeal Division in Law Society of Ontario v Guiste, 2025 ONLSTA 29, and rejected. In that case the licensee raised the recent Alberta cases, but the Appeal Division reaffirmed the traditional Ontario approach, referred to Groia, and stated at paras 29-30:
What is proposed by Mr. Guiste is a complete departure from the current criteria for assessing costs that licensees should pay where a finding of misconduct is made … This general rule has consistently been applied by this Tribunal. No compelling grounds were provided for abandoning this Tribunal’s longstanding jurisprudence in determining the appropriate costs ….
Costs paid by the disciplined licensee versus costs paid by the general membership
14The principle as originally stated in Baker in 2006 is expressed in general language that would appear to mean that the wayward licensee should bear all the costs of the discipline proceeding, and the general membership should bear none of the costs. The wording from Baker has been quoted many times by the Tribunal, exactly as stated. However, a slight clarification may be in order.
15In fact, a “full costs” order, as would appear to be implied on a straightforward reading of the wording in Baker, is rarely sought by the Law Society and is rarely made by the Tribunal. Instead, it is recognized that there are various factors at play and that a panel has discretion, taking those factors into account, to come to its own costs award, which will frequently be, and usually is, less than the full costs incurred in the preceding.
16As stated by the appeal panel in Law Society of Upper Canada v Kazman, 2008 ONLSAP 7 at para 80:
With respect to the costs award, it is our view that the licensees at large should not have to bear all the costs of the investigation, counsel and hearing time generated by a licensee found to have engaged in professional misconduct. [emphasis added] On the other hand, the costs can reach stratospheric levels. We recognize that the licensees at large benefit from the diligent work of the Law Society in ferreting out on their behalf the few licensees who engage in professional misconduct. For that reason, it is not improper for all licensees, in the guise of the Law Society, to sometimes bear some of the costs. [emphasis in original]
17A necessary result of this existing general practice (of not awarding full costs) is that, since such costs are a zero-sum situation, the members of the professions generally do in fact bear some of the cost of disciplining their fellow members. As has been noted by the Appeal Division in Law Society of Upper Canada v Dyment, 2014 ONLSTA 41 at para 4, “… the Tribunal must recognize that the Law Society’s costs in a Tribunal proceeding that are not compensated by a costs award will be borne by the profession as a whole.” In the Dyment case, as an example, the Law Society sought $38,000 in costs, the licensee argued for $10,000, and the Tribunal awarded $25,000.
18It has been said, as alluded to above, that dispersing such costs to the general membership is a fair price for the privilege of being a member of a self-governing profession. It has also been noted that the system of adjudicative disciplining of members of the legal professions is not a direct cost to the public, as is the case for example in the general court system which is funded by taxes.
19Ontario courts have, through their decisions, approved regulatory bodies’ costs orders that awarded only part, not all, of the regulator’s actual costs of the disciplinary proceedings. The end result of this was that the general membership, in each of those cases, did in fact, with the approval of the court, end up bearing the part of the actual costs not covered by the costs award: Aronov at para 54, Groia at paras 233, 235, and Walia, at paras 29-30.
20It has been often noted that such costs awards are not, and should not be treated as, an additional penalty for the licensee. They are a form of cost recovery and indemnification, of the Law Society at first instance, and more indirectly, of the membership at large who fund the process with their professional dues paid to the Law Society.
21An implication of the above costs principles and practices is that there is, in practice, a presumption or starting point in all discipline cases that a licensee who is found to have been offside will pay a costs award, in addition to bearing any actual penalty imposed.
22It thus behooves a licensee, when first contacted by the Law Society with concerns about his or her professional behaviour, to keep in mind that quite aside from potential penalties, they may well have to deal with a costs award at the end. At the same time, as will be described below, the Tribunal’s jurisprudence allows a member who has run into trouble to reduce the consequential costs awards against them, depending on how they conduct themselves in the discipline process.
Costs factors
23The various factors that a panel can usefully take into account in its costs decision were first extensively set out by the Hearing Panel in 2008 in Law Society of Upper Canada v Winton, 2008 ONLSHP 36, and adopted by the Appeal Panel in Law Society of Upper Canada v Kay, 2008 ONLSAP 8.
24Subsequent updating and consolidation of the factors potentially to be considered occurred in Gold v Law Society of Upper Canada, 2012 ONLSAP 16, Law Society of Upper Canada v Dyment, 2014 ONLSTA 41, Law Society of Upper Canada v Kivisto, 2016 ONLSTA 11, and Law Society of Ontario v Adams, 2018 ONLSTH 91. We note that reference is sometimes made to Law Society of Ontario v Lee, 2019 ONLSTA 4. Lee was issued shortly after the leading case of Perrelli, discussed below, but Lee does not refer to Perrelli or take Perrelli into account, and some points in Perrelli are missing from Lee, so we prefer referring directly to Perrelli.
25In the leading case of Perrelli, then Tribunal Chair Wright created a useful summing up of the factors potentially to be considered in a costs award:
the amount involved in the proceeding;
the complexity of the proceeding;
the importance of the issues;
the duration of the hearing;
the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;
whether any step in the proceeding was improper, vexatious or unnecessary, or taken through mistake or excessive caution;
the ability of the party to pay a costs award;
the reasonable expectations of the parties;
the costs awarded in other cases;
the principle of proportionality; and
the circumstances of the proceeding.
26It has always been clear that these specific itemized factors may be relevant and helpful in particular cases, but that these are not a checklist that needs to be explicitly discussed one by one in every case. It is also recognized that there may be other factors to be taken into account, and that this list does not limit the Tribunal’s general broad discretion as to costs.
27In Perrelli then Chair Wright offered several other important observations about costs:
In my view licensees should not be paying dramatically different amounts depending on the approach to costs of a particular panel or Law Society representative. I suggest that a greater focus on the costs awarded in cases that proceeded in a procedurally similar manner would help bring more coherence to this Tribunal’s jurisprudence. (para 4).
Mr. Dent [the licensee’s counsel], who regularly represents licensees before this Tribunal, submitted that while the principle that the professions should not be responsible for costs of prosecutions is legitimate, his clients often find the amounts sought by the Law Society very high. From their point of view, costs feel like an additional penalty, and can be a barrier to re-establishing a practice after suspension. He submitted that Costs awards should remain flexible and be an incentive to proceeding with a Tribunal hearing in an efficient way.
On behalf of the Law Society, Mr. Pelletier … emphasized that “Where the Law Society has incurred additional costs because of the failure of the licensee to co-operate; this triggers additional steps and work...” (para 34)
Costs are necessarily discretionary; they must be flexible and take into account individual circumstances. But discretion should be exercised in a broadly consistent way. Cases that proceed similarly with licensees in a similar circumstance should result in similar costs awards.” (para 35)
We know what should make a costs award higher or lower, but what amount is the starting point? … The analysis typically starts from the bill of costs put forward by the Law Society based on the tariff …. (para 36-37)
Various factors that can make the Law Society’s bill of costs vary considerably, with the result that the Law Society’s bill of costs is not always the best starting point. (para 37-38)
Chair Wright then states one of his central points: “While there is wide variation in how litigation proceeds before the Tribunal, there are some common patterns. In my view, how the litigation proceeded should be the starting point for costs awards, and similar patterns should lead to similar awards.” (emphasis added)
Beginning the analysis of costs by looking at how the litigation proceeded before the Tribunal and comparing it to other cases that were litigated in a similar way takes into account several factors set out in the jurisprudence: reasonable expectation of the parties, circumstances of the proceedings, costs awards in other cases, and proportionality. (para 44)
Reducing costs awards in recognition of conduct that reduces hearing time
28While we take into account all the factors relevant to costs in this particular case, we believe it is useful to bring special attention to the “costs reduction” factor, which has been in the list of factors since it was first created in Winton in 2008, and was adopted by the Appeal Division in Kay in 2008 and again in Perrelli in 2018. That is factor number 5: “The conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding”. In particular we focus on conduct of a party “that tended to shorten the duration of the proceeding”.
29In doing so, we apply one of the key principles of Perrelli, that is, to look at how the litigation proceeded.
30Put simply, we will reduce the costs award in this case from what it otherwise would be because of conduct or various actions of the Lawyer (and her counsel) in the overall course of the proceeding which clearly shortened the duration of the hearing.
31The case of Winton, which first formulated the list of factors to be considered, is an example where actions by the licensee shortened the proceedings, which resulted in a reduced costs award by the panel. In Winton, the licensee:
Entered into an agreed statement of facts, in which the lawyer admitted the particulars contained in the Law Society’s notice of application.
Admitted that the particulars constituted professional misconduct.
Co-operated fully with the Law Society, both throughout the investigation and the hearing.
32As a result of this co-operative conduct by the licensee, the hearing in Winton required only two separate half-days, the second half-day dealing only with argument on penalty.
33In recognition of the licensee’s conduct in the hearing, the panel ordered no costs. Winton is thus an example of the financial benefits a licensee can achieve by intelligently co-operating in the hearing process.
34The Tribunal has reduced costs awards in recognition of how the licensee’s co-operation has reduced hearing time or otherwise made the process more efficient in many other cases: Law Society of Ontario v Adams, 2018 ONLSTH 91 at para 22, Law Society of Ontario v Ceponis, 2023 ONLSTH 93 at paras 66 and 71, Law Society of Ontario v Rogerson, 2024 ONLSTH 12 at para 28, Law Society of Ontario v Owodunni, 2024 ONLSTH 34 at para 136, and Law Society of Ontario v Bastien, 2025 ONLSTH 53 at paras 87, 90, 91.
35This is of course not to take anything from a licensee’s right to make full answer and defence. But it is a recognition that the Law Society’s robust legal powers of investigation, such as the request to admit, the active investigation staff, the power to obtain records, and much more, can be formidable, perhaps more so than many self-represented licensees in the process are at first fully aware of. It is simply to make clear that there are procedural alternatives to all-out resistance available to a licensee that can result in benefits compared to the alternatives.
36At the same time, we would note that measures which shorten hearings, and which may tend to potentially benefit the individual respondent through possible reduced costs awards, also may have broader important benefits. Such measures, such as an agreed statement of facts, also enhance the quality and integrity of the hearing process itself, to the benefit of the legal professions generally and the public. For example, when the parties in a disciplinary matter have agreed upon the foundational facts, the panel can devote its attention to the genuinely contested issues, confident that the background factual record is accurate, relatively complete, and not burdened by unnecessary disputes. This provides a more reliable and coherent evidentiary framework, which in turn supports a more accurate, more fair, more transparent, and more carefully reasoned decision, in a way that is hopefully likely to contribute to the maintenance of more ethical and more competent legal professions generally.
37We make a point of highlighting the possibility of a licensee reducing a potential costs award because many licensees who appear before the Tribunal are self-represented and often appear to adopt representation approaches evidently not based on an awareness that certain approaches can be quite financially beneficial to them in the end (as well as the converse). Again, this is not to take away from the principle of full answer and defence, but their options for benefiting their own long-term financial interests with a careful approach in the matter are not always immediately evident.
Application of jurisprudence to this case
38Applying then Chair Wright’s observation that the starting point for costs awards should be “how the litigation proceeded” can be best approached in this particular case by looking at the length of the hearing, which was a total of three days. This offers a summary and clue about the overall hearing process. As will be described below, three days of hearing time was short for a case of this nature (it could well have gone on for considerably longer), and that relatively short hearing time tells us much about how this litigation proceeded and how that should potentially affect the costs award.
39Three days of hearing time was short in the circumstances of this case considering:
The amount involved: This case involved a loss of $3.5 million as loaned by 59 clients. This is a very serious matter in terms of the financial loss to many innocent clients, and dealing with such a serious loss could easily require much hearing time.
The complexity of the proceedings: The matter involved fairly complex commercial transaction documentation, both in terms of the validity or otherwise of the legal documents, and in terms of the progress of the proposed development until its collapse. While not on the extreme end of complexity, the matters involved were considerably complex.
The importance of the issues: The case involved, on the one hand, the key question of whether ordinary people could invest, in some cases their life savings, in an apparently legitimate development, which was given legitimacy and validation by the involvement of a lawyer. It also involved, on the other hand, a lawyer who entered into a complex and high-stakes legal arrangement about which she knew little, tempted by the possibility of low-effort remuneration and future work – a situation often tempting for early-career lawyers trying to build a practice – but who now risked losing her future career. The stakes were high on both sides.
40In that circumstance, the litigation could have resulted in an aggressive defence by the Lawyer, requiring many live witnesses, extensive cross-examination, slow elucidation of countless details, aggressive attacks and counterattacks, expert witnesses, and ongoing uncertainty about contested facts. This could have taken many days, even weeks, and left us to sort out many issues in hot dispute.
41However, that did not happen. Instead, we benefitted from various steps taken by both parties, including the Lawyer and her counsel, which “tended to shorten … the duration of the proceeding”.
42Specifically, we were presented before the hearing with a 33-page detailed agreed statement of facts (ASF) which set out in easily understandable form a meticulous chronology of events, understandable explanations of the complicated transactions, and many admissions by the Lawyer of key facts that were not favorable to her. Furthermore, the ASF was completed several weeks before the hearing, not in a rush the day before.
43The ASF was the product of very considerable efforts by both counsel and the Lawyer, and it was of immense assistance to us.
44Each side filed a thorough book of documents; the Law Society’s was over 300 pages; the Lawyer’s was over 700 pages. Both were completed well before the hearing date.
45The Lawyer’s document book contained her own detailed 20-page affidavit, which was clear, easy to understand, and contained many obviously painful admissions on key points.
46Each of these resource books could easily and quickly be entered into evidence at the beginning of the hearing, on consent, as collective exhibits, rather than through a time-consuming piecemeal process. These served as convenient and important clarification references throughout.
47The result of all these materials was that the proceedings were able to proceed quickly and efficiently, with pointed but focused and efficient arguments, and based on a clear and undisputed factual foundation.
48In that context, the Law Society presented a bill of costs totaling $66,937.65 but asked for a reduced amount of $60,000. The Law Society noted that much of its costs had been “front-loaded”; that is, considerable effort had been put into preparing the various materials beforehand, which then produced a shortened hearing. We do not doubt the legitimacy of those amounts and those efforts.
49Counsel for the Lawyer noted that the underlying conduct allegations had been admitted to by the Lawyer early on, and that all the relevant facts were included in the ASF, which meant that no expert evidence was required and that the hearing itself could be narrowly focused on the issue of penalty. The Lawyer’s counsel argued that “The Respondent significantly reduced the duration of the proceeding by, from the first PHC, agreeing to admit to every allegation for which there was an evidentiary foundation. This was ultimately every allegation except particular 1(d), which was withdrawn”. He described his client as “highly co-operative”.
50Counsel for the Lawyer submitted that “it is a reasonable expectation of the Respondent that, where a licensee admits the allegations and agrees to a comprehensive ASF”, such factors will be taken into account towards reducing costs. We agree in the context of the Tribunal’s pre-existing jurisprudence that that is a reasonable expectation of the parties, and indeed, that such co-operation on the part of the licensee should bring significant benefits in the form of a significant reduction in costs from what they otherwise would be.
51Licensee’s counsel submitted that an appropriate costs award would be in the range of $25,000.
CONCLUSION
52We are of the view that the work and co-operation from counsel and the Lawyer produced a better result for both parties, and for the legal professions and the public generally. We are also of the view that that effort and co-operation by the Lawyer, which was often of course difficult and even painful for her, should be recognized in a costs award that is significantly reduced from what it otherwise would be.
53Such a reduced costs award is entirely separate from the penalty already earlier imposed, and is not an endorsement of the Lawyer’s conduct as set out in our earlier reasons, but is specifically recognizing the efficient and co-operative manner in which the Lawyer participated in the hearing.
54While such a costs award reduction inevitably means that the legal professions generally bear more of the costs of this discipline proceeding, we are of the view that that cost has offsetting benefits. Without such co-operation in this case by the Lawyer and her counsel, this hearing would inevitably have taken much more time, at greater end cost to the professions generally than this costs reduction represents.
55Part of those benefits may lie in the possibility that licensees who in the future find themselves in these difficult and unfortunate straits are able to realize early on in the process that they themselves may benefit from providing a real degree of co-operation in the process.
56Given the degree of co-operative efforts by the Lawyer and her counsel, we believe that a costs award in the amount suggested by the Lawyer’s counsel is appropriate, and we set costs at $25,000.
57This is not to take anything away from the diligent pre-hearing efforts of Law Society counsel and staff, which helped produce the meticulous and comprehensive and highly valuable documentation, and which were equally key to an efficient hearing. It should also be noted that other Tribunal members greatly assisted the process with case management hearings along the way.
58We therefore order:
The Lawyer shall pay costs to the Law Society in the amount of $25,000 on or before December 31, 2027.
Interest shall accrue on any overdue part of these costs at a rate of 4% per year.