COURT OF APPEAL FOR ONTARIO
CITATION: Speciale Law Professional Corporation v. Shrader Canada Limited, 2015 ONCA 856
DATE: 2015-12-07
DOCKET: C60537
Laskin, Pardu and Miller JJ.A.
BETWEEN
Speciale Law Professional Corporation and Anthony M. Speciale Solicitors (Appellants)
and
Shrader Canada Limited Client (Respondent)
John Gray, for the appellants
Rosemary Fisher, for the respondents
Heard: November 24, 2015
On appeal from the order of Justice Turnbull of the Superior Court of Justice, dated May 27 2015.
By the Court:
A. Background
[1] This appeal arises out of assessment proceedings taken by the client, Shrader Canada Limited, against its lawyer Anthony Speciale and his professional corporation Speciale Law Professional Corporation (SLPC).
[2] From 1979 to 2013 Speciale or SLPC acted as counsel to Shrader and rendered accounts to it. From 2009 to 2013 Speciale was also the president and Chief Executive Officer of Shrader. Fifty-one accounts are in issue in these proceedings. All accounts are on the letterhead of SLPC, and signed by Speciale. All accounts have been paid.
[3] In July 2013 Shrader obtained on requisition a Registrar’s order and appointment to assess the Solicitor’s accounts. The order was obtained under s. 3 of the Solicitors Act, R.S.O. 1990 c. S-15, without notice to Speciale or SLPC.
[4] In October 2013, Speciale’s counsel told Shrader he intended to bring a motion to challenge and set aside the order for the assessment. That motion was not brought until late May 2015. In the meantime, in January 2014, Speciale went to a mediation in the assessment proceedings, and when the mediation did not settle the matter, in September 2014 attended the Assessment Scheduling Court.
[5] The assessment was scheduled to begin on June 1, 2015 and be continued in July. On May 26, Speciale brought an urgent motion to adjourn or stay the assessment and to quash the Registrar’s order for the assessment. Turnbull J. dismissed the motion. Speciale and SLPC appeal from his order.
[6] On its face, Turnbull J.’s order is interlocutory. But, as his reasons show, he decided issues that could have deprived Speciale and SLPC of substantive defences, we have treated the order as final for the purpose of appeal.
[7] The assessment has now taken place. Thus the appeal from Turnbull J.’s refusal to adjourn or stay the assessment proceedings is moot. But whether the Registrar’s order for assessment should be quashed remains a live issue, as Speciale and SLPC have opposed confirmation of the assessment report.
B. Discussion
[8] In dismissing their motion, the appellants Speciale and SLPC submit that Turnbull J. made the following five errors.
He erred by failing to quash the assessment proceedings against Speciale personally as none of the accounts were rendered by him.
He erred by failing to hold that 43 of the 51 accounts were for management and administration services, and therefore the assessment officer had no jurisdiction to assess these accounts.
He erred by failing to hold that the retainer was in dispute, and for that reason the order for assessment must be set aside.
He erred by failing to find special circumstances sufficient to justify setting aside the order for assessment.
He erred by failing to find that the requisition for assessment was not timely.
[9] We will address each of these alleged errors.
(1) Speciale and SLPC
[10] The appellants submit the assessment should be quashed against Speciale personally as he did not render any of the 51 accounts in question. Turnbull J. did not explicitly address this issue, but we decline to give effect to the appellants’ submission.
[11] Admittedly, each of the accounts was on the letterhead of SLPC. But Speciale signed each of the accounts. And, importantly, the appellants led no evidence to show that SLPC included other lawyers or was anything other than the professional corporation of Speciale alone. On the record before Turnbull J., to give effect to the appellants’ submission would be unseemly and unjustified.
(2) Management accounts and legal accounts
[12] As we have said, the appellants claim that 43 of the 51 accounts were for management or administrative services and ought not the have been assessed under the Solicitors Act.
[13] The appellants contend that the Re line on each account distinguishes accounts for management services from accounts for legal services. For example, they say all accounts with the Re line Shrader Canada Limited are accounts for management services, while an account with the Re line referring to a litigious matter is an account for legal services. They also point to internal accounting documents that appear to distinguish the two types of accounts.
[14] Turnbull J. considered this issue, reviewed the accounts and concluded that they were all legal accounts. At para. 20 of his reasons he said:
I have had the opportunity to review the accounts which has been submitted. They are found as exhibit H to Mr. Speciale’s affidavit sworn May 24, 2015. The accounts attached thereto are all rendered on the letterhead of Speciale Law Professional Corporation. The preamble specifies in each account, that the account is for interim fees for services rendered for the period covered by the bill. Each account is broken down into lawyer time and docketing time for a law clerk. The account is signed by Anthony M. Speciale, Barrister & Solicitor. They are clearly legal accounts rendered to Shrader Canada. Counsel for the responding party Shrader has referred me to the Law of Costs, Second Editions Volume 2 by Mark M. Orkin, particularly to page 373, paragraph 316 dealing with nonprofessional services. There the learned author wrote:
“The fact that the services in question might equally well have been rendered by a lay agent does not, however, eliminate the need for compliance with requirements of the Solicitor’s Act if the employment is so connected with the professional character of the solicitor as to afford the presumption that it formed the ground of employment by the client.”
[15] We agree with Turnbull J.’s conclusion and his reasons.
(3) The Retainer
[16] If the retainer is in dispute, a client may not obtain an order on requisition under s. 3 of the Solicitors Act. The appellants submit that their retainer was in dispute because Shrader never executed a retainer agreement, and Speciale’s rates were never approved by the Shrader board.
[17] We do not agree with this submission. Although Shrader did not sign a written retainer agreement, the retainer itself, which was in place for many years, was never in dispute. And that Speciale’s rates were never approved was simply a matter that went to the amount of his fees, and was properly within the jurisdiction of the assessment officer to determine.
[18] Turnbull J. addressed this issue at paras. 23-24 of his reasons:
Mr. Yellin, on behalf of his client, Ms. Malcolm, stated that there is no denying the existence of the retainer. The comments made by his client and the assessment involved in this matter is an attack on the quantum of the bills and work done. The retainer is not in dispute.
Hence, on that basis I am satisfied that the retainer of this solicitor is not disputed within the meaning of Section 3 of the Act. As Mr. Yellin indicated, this is not a case where a lawyer acted without instructions.
We agree.
(4) Special circumstances
[19] A client may also not obtain an order on requisition if “special circumstances” exist. Special circumstances are “any circumstances of an exceptional nature” that a court ought to consider before an order for assessment is made. See Davies, Ward & Beck v. Union Industries, Inc., 2000 CanLII 5722 (ON CA), [2000] O.J. No. 1769 at para. 22.
[20] Here, the appellants submit two circumstances are “special”: most of the accounts were for management services, and all of the accounts have been paid. Turnbull J. rejected this submission and so do we.
[21] We have already concluded that all 51 accounts were legal accounts, properly subject to assessment. The payment of accounts is a factor to be considered in deciding whether special circumstances exist, but it is not a determinative factor. As Labrosse J.A. said in the Davies, Ward & Beck case at para. 21: “The totality of the circumstances must be considered.” In this case, the totality of circumstances includes the appellants’ participation in the assessment proceedings, which led Turnbull J. to conclude that no “special circumstances” exist. We agree with him.
(5) Timeliness of the Requisition
[22] Under s. 3(b) of the Solicitors Act, a client may obtain an order on requisition for the assessment of a bill already delivered, within one month of its delivery. Under s. 4 of the Solicitors Act, no order on requisition may be obtained after 12 months from the time the bill was delivered unless special circumstances exist. The appellants submit that Shrader has not met either of these time requirements. We do not accept this submission.
[23] All 51 bills were delivered. Their delivery is not disputed. The last account was dated May 15, 2013. Thus the 30 day period under s. 3(b) of the Act expired on June 15, 2013. The order was not obtained until July 31, 2015.
[24] All the accounts are stated to be interim accounts, and the appellants accept that when a solicitor delivers a series of interim accounts, the 30-day period under s. 3(b) does not begin to run until the last account is delivered. See Farlinger v. Maurice Neirinck, [2008] O.J. No. 88. The appellants contend, however, that the order on requisition was still out of time by a month and a half. Turnbull J. rejected this contention for either of two reasons:
I find in the circumstances, that though there may have been a technical irregularity with respect to the issuance of the order, Mr. Speciale has attorned to the jurisdiction of the assessment order. The test for whether the steps taken by a party in a proceeding amount to attornment was recently considered by the Court of Appeal in Wolfe v. Pickar, 2011 ONCA 347 at para. 44:
“… when a party to an action appears in court and goes beyond challenging the jurisdiction of the court based on jurisdiction simpliciter and forum non conveniens, the party will be regarded as appearing voluntarily, thus giving the court consent-based jurisdiction”.
[25] And:
If I am wrong in this respect, this court has inherent jurisdiction remedy any perceived defect in the issuance of the original order for assessment and I would have done so nunc pro tunc and ordered that the assessment proceed as scheduled on June 1, 2015.
[26] We are not persuaded that his reasons reflect any error warranting our intervention.
[27] Some of the accounts in question were delivered over a year before Shrader obtained the order for assessment. Turnbull J. found that because all the accounts were stated to be interim accounts, this very fact amounted to “special circumstances”, that met the requirement in s. 4 of the Act. We agree.
[28] In effect, as Himel J. said in Farlinger: “The overlapping and interrelationship of accounts constituted special circumstances.” And, “the client could not be expected to have objected to and taken out orders of assessment after each account was rendered.” Also, as Turnbull J. noted, Speciale was the president and Chief Executive Officer of Shrader for part of the time when his accounts were delivered and paid. Only when Shrader obtained outside legal advice did it decide to assess the accounts.
C. Conclusion
[29] For these brief reasons we conclude that Turnbull J. did not err in refusing to quash the order for assessment. The appeal is therefore dismissed with costs fixed at $15,000 inclusive of disbursements and applicable taxes.
Released: December 7, 2015 (“G.P.”)
“John Laskin J.A.”
“G. Pardu J.A.”
“B.W. Miller J.A.”