CITATION: The Law Society of Ontario v. Diamond, 2019 ONSC 3228
DIVISIONAL COURT FILE NO.: 544/18
DATE: 20190529
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Sachs, Linhares De Sousa and Thorburn JJ.
BETWEEN:
The Law Society of Ontario
Respondent
– and –
Jeremy Dov Diamond
Appellant
Leslie Maunder, for the Respondent
Brian H. Greenspan and Naomi M. Lutes, for the Appellant
HEARD: April 23, 2019
H. SACHS J.:
Introduction
[1] Mr. Diamond, the Appellant, appeals the decision of the Law Society Tribunal Appeal Division (the "Appeal Division") dated August 1, 2018, in which it upheld the decision of the Law Society Tribunal Hearing Division (the "Hearing Division") dated September 21, 2017. In its decision, the Hearing Division found that Mr. Diamond had failed to co-operate with a Law Society investigation into his firm's referral practices. The failure to co-operate was due to Mr. Diamond's delay in providing various financial records to the Law Society. Ultimately, all of the requested records were provided. Pursuant to a joint submission on penalty, the Hearing Division ordered that Mr. Diamond be reprimanded and pay $25,000 in costs to the Law Society.
[2] Under the Law Society's Rules of Professional Conduct, lawyers are required to act in good faith to reply promptly and completely to the Law Society. This appeal raises the issue of what constitutes acting in "good faith". According to the Appellant, the Appeal Division construed the concept too narrowly and in doing so unreasonably punished a licensee who at all times expressed a willingness to provide the requested information and only delayed doing so because of confusion and misunderstanding. According to the Respondent, the Appeal Division's approach to the question of good faith and failure to co-operate was a straightforward application of the existing jurisprudence and an assessment of the Hearing Division's factual conclusions. The task was within its expertise and the decision was reasonable.
[3] For the reasons that follow, I would dismiss the appeal.
Background
[4] In a letter dated October 17, 2016, the Law Society informed Mr. Diamond that it was investigating his firm's structure and referral fee practices. The Law Society investigator requested that Mr. Diamond provide various documents and responses, including financial records, bank records, journals, cancelled cheques, and files relating to specific client matters. The investigator was trying to find out what referral fees were being paid to the Appellant and by whom.
The Disclosure at Issue
[5] Mr. Diamond produced a significant amount of requested material fully and promptly. However, the Law Society alleged that Mr. Diamond failed to co-operate in producing six categories of records:
(i) General Receipts Journal
(ii) General Disbursements Journal
(iii) General Monthly Bank Statements (TD and CIBC)
(iv) Cancelled Cheques from 2013 to 2016 (TD and CIBC)
(v) Deposit Slips
(vi) Various File Documents relating to referrals
[6] The Hearing Division found that the manner in which the Various File Documents were provided did not represent a failure to co-operate. Only Mr. Diamond's cooperation in relation to the first five categories is at issue.
Categories 1 and 2: The General Receipts and Disbursements Journals
[7] Counsel for Mr. Diamond responded to the Law Society's initial request for documents by letter dated November 28, 2016. This letter addressed every regulatory issue raised by the Law Society, attached numerous documents, and explained which documents were still forthcoming. With respect to the general receipts journal, counsel advised that the firm did not have one "per se". Mr. Diamond's counsel encouraged the Law Society to let him know if the information provided was insufficient and what, if any, specific further information it might require. He also welcomed the Law Society to attend at the firm's offices if this would help make sure that it got the information it needed.
[8] Still seeking to find out what referral fees Mr. Diamond's firm received, and from whom and when, the Law Society repeated its request for a general receipts journal, as well as other documentation and information, by letter dated December 13, 2016. In its letter the Law Society specifically referenced section 18(5) of Bylaw 9, which requires all licensees to keep a general receipts journal and defines and describes what that record is. On December 15, 2016, the Law Society sent Mr. Diamond's counsel a document that described a general receipts/disbursements journal as follows: "A book of original entry showing all money (other than trust funds) received/disbursed, including date, method, amount and person received from/disbursed to." Mr. Diamond's counsel responded by letter dated December 28, 2016, advising that Mr. Diamond did not have a general receipts journal.
[9] On February 14, 2017, the Law Society requested the general receipts journal again. The Law Society also requested Mr. Diamond's general disbursements journal and other documentation. Mr. Diamond's lawyer and the Law Society investigator spoke on the phone on February 23, 2017 about the request, and Mr. Diamond's lawyer sent an email attaching various documentation the next day. He sent another email giving an update on progress with respect to efforts to gather documentation on March 2, 2017.
[10] On March 10, 2017, Mr. Diamond's counsel sent other documents, but again advised that Mr. Diamond did not have a general receipts or disbursements journal. He stated that bank statements and deposit slips would be provided that would essentially provide the information. The Law Society responded on March 28, 2017, asking again for the journals, as well as Excel spreadsheets containing the dates and amounts of all referral fees for specific time periods.
[11] The Law Society investigator interviewed Mr. Diamond on March 30, 2017. At this point, Mr. Diamond told the Law Society investigator that he did in fact keep a record of referral fees received from other lawyers, using an accounting software called QuickBooks.
[12] On April 3, 2017, the investigator informed Mr. Diamond that he was being investigated for not keeping proper books and records. Mr. Diamond responded through counsel on April 17, 2017, stating that he complied with his record-keeping requirements through the records he kept in QuickBooks. With regard to the disbursements journal, counsel questioned whether it was necessary to provide those records. Mr. Diamond did not provide the QuickBooks records at this time. Counsel stated that the volume of records would be enormous, and suggested that a sample of the records could be produced instead.
[13] On June 22, 2017, Mr. Diamond provided the investigator with the QuickBooks records identified during his interview on March 30, 2017. The investigator inferred that the QuickBooks software could likely generate reports that would meet the criteria for general receipts and disbursements journals. The investigator arranged a meeting with Mr. Diamond and his bookkeeper on July 4, 2017 and assisted his bookkeeper in generating the appropriate format for the journals from QuickBooks. These records were then produced to the Law Society.
Category 3: The General Monthly Bank Statements
[14] Mr. Diamond had bank accounts at two financial institutions: a CIBC account which was the principal account into which referral fees were deposited and a line of credit account at TD that had much less activity.
[15] The Law Society requested general account statements in its initial letter of October 17, 2016. Mr. Diamond's counsel advised that he was compiling the statements and would provide them in his responding letter dated November 28, 2016.
[16] Although the majority of the general account statements were provided by December 29, 2016, the Law Society advised by letter dated February 14, 2017 that it was still missing some bank statements for the TD account. The letter also, mistakenly, advised that some CIBC account statements were missing - they had already been provided.
[17] On February 24, 2017, Mr. Diamond's lawyer advised that the TD account was a line of credit and that he was awaiting confirmation from the bank as to whether there were any further statements in existence. On March 2, 2017, he confirmed that he would be providing the remaining TD statements shortly. By letter of March 10, 2017, counsel confirmed, mistakenly, that all bank statements had been provided.
[18] The Law Society renewed its request for the TD statements by letter dated March 28, 2017. By email dated April 7, 2017, Mr. Diamond's lawyer advised that the statements had been ordered and would be provided, and provided an Excel spreadsheet setting out the account activity. On June 22, 2017, all remaining TD statements were provided.
Category 4: The Cancelled Cheques
[19] The Law Society first requested cancelled cheques for Mr. Diamond's general accounts on February 14, 2017, in an effort to obtain the referral fee information in the absence of the general receipts journal. On March 2, 2017, Mr. Diamond's counsel advised that he would provide them in short order. On March 10, 2017 he stated that he had requested the cancelled cheques from the bank.
[20] The Law Society again requested the cancelled cheques on March 28, 2017. Counsel learned that there would be a significant cost associated with obtaining the cancelled cheques. Counsel discussed this with the investigator during a phone call on April 7, 2017, attempting to narrow the Law Society's request to avoid some of the costs. Counsel also suggested that it could provide the Law Society with authorizations to obtain the cancelled cheques it desired (at its own cost), and indeed did provide this authorization. The Law Society advised that it would seek instructions. The Law Society never got back to Mr. Diamond on this point.
[21] On May 29, 2017 the Law Society requested the cheques again. Following a pre-hearing conference on June 12, 2017, counsel for the Law Society advised that the Society was prepared to provide a list of specific cheques to be produced. However, Mr. Diamond had already obtained all cancelled cheques by this time. On June 22, 2017, Mr. Diamond's counsel confirmed that the request for all cancelled cheques had been abandoned by the Law Society and indicated that Mr. Diamond would produce any cancelled cheques upon request.
Category 5: The Deposit Slips
[22] The Law Society first requested the deposit slips on February 14, 2017. Mr. Diamond initially responded, on March 10, 2017, that he did not retain deposit slips and therefore they could not be provided. Through subsequent discussions with his bookkeeper in June 2017, he discovered that this was not the case. The deposit slips were provided on June 22, 2017.
The Decisions Below
[23] The Hearing Division found Mr. Diamond had committed professional misconduct through his failure to co-operate with the Law Society's investigation. It found that Mr. Diamond must have known that he had the records containing the information required by Bylaw 9, and that the communications between Mr. Diamond and the Law Society amounted to a "cat and mouse game". It further found that the documents requested are routine documents that are required to be kept or which should be available from institutions on short notice, and Mr. Diamond should have been able to provide them more promptly.-
[24] The Appeal Division held that these findings were reasonable. It found that it was reasonable to conclude that there had been a lack of good faith given the passage of time, the numerous explanations provided by the Law Society as to what was required, and the fact that licensees are required to have such information readily available. The Appeal Division further found that any confusion or mistaken beliefs on the part of Mr. Diamond did not relieve him from his failure to co-operate, as "[l]icensees must understand their obligations and comply with them; a confused licensee who has not taken the time and effort to be aware of those obligations may be found to have engaged in misconduct."
Issues Raised
[25] The Appellant raised the following issues on this appeal:
(a) Did the Appeal Division err in law by interpreting the concept of good faith too narrowly?
(b) Did the Appeal Division err in law by conflating the test for failing to co-operate with the positive obligation on a lawyer to keep certain records?
(c) Did the Appeal Division come to an unreasonable conclusion?
Jurisdiction and Standard of Review
[26] Section 49.38(b) of the Law Society Act, R.S.O. 1990, c. L.8 provides for an appeal to the Divisional Court from a final order of the Appeal Division under s. 34 (as in this case).
[27] In his factum, the Appellant asserted that the applicable standard of review with respect to the questions of law raised on this appeal was correctness. In oral argument he changed his position and conceded (appropriately) that it was reasonableness.
[28] Only questions of law that are outside the expertise of the Appeal Division and of central importance to the legal system are reviewable on the correctness standard. The questions raised on this appeal relate to the Appeal Division's interpretation of its home statute using legal concepts closely related to it and that are well within its expertise. It is entitled to deference in these areas and the Divisional Court should only intervene if the Appeal Division's decision is unreasonable (Groia v. Law Society of Upper Canada, 2018 SCC 27, [2018] 1 S.C.R. 772 at paras. 43-48).
Analysis
(a) Was the Appeal Division's Application of the Concept of Good Faith Unreasonable?
The Appeal Divison's Analysis of the Concept of Good Faith
[29] Rule 7.1-1 of the Rules of Professional Conduct provides that "A lawyer shall reply promptly and completely to any communication from the Law Society in which a response is requested."
[30] Section 18 of By-Law 9 made pursuant to the Law Society Act requires all lawyers to keep certain records. Sections 21 and 22 of the same by-law make it clear that these records are to be kept current and kept in a form where they can be produced promptly at the Society's request. All of the records the Law Society requested from the Appellant were records that he was required to keep under s. 18 of By-Law 9.
[31] The Appeal Division reviewed the purpose of Rule 7.1-1, the duty to co-operate, and referred to its jurisprudence (Law Society of Upper Canada v. Baker, 2006 ONLSHP 21) to find that the purpose of the Rule relates directly to the Law Society's primary mandate - to govern the legal profession in the public interest. As put by the Appeal Division at para. 6:
When a licensee fails to respond promptly and completely, it leads to costs to the Law Society, delay and diminished respect for the legal profession and their self-governance.
[32] The Appeal Division then made the following points about the duty to co-operate and the role that the concept of "good faith" plays in assessing whether a lawyer has failed to fulfill that duty:
(i) Assessing whether a licensee has breached the duty to co-operate requires evaluating whether the licensee was sent correspondence requesting a reply and then acted in good faith in providing a complete and prompt response.
(ii) Determining whether a response was complete and prompt depends on the circumstances. Deadlines set by the investigator do not end the issue; the issue is one for the panel (as authority for these points the Appeal Division cited Law Society of Upper Canada v. Ghobrial, 2014 ONLSHP 5 at para. 8).
(iii) Good faith is more than an absence of bad faith. "To act in good faith, the licensee must be honest, open and helpful to the Law Society in fulfilling its regulatory functions, considering all the circumstances" (Law Society of Upper Canada v. Boissonneault, unreported, quoted in the Hearing Division's reasons at para. 20). "The licensee must take positive steps to ensure that the Law Society quickly obtains what it needs." (Appeal Division Reasons, para. 8)
(iv) To establish a breach of the Rule the Law Society "is not required to establish an intention to frustrate or hamper an investigation. In most circumstances, the panel can draw an inference from the delay itself." (Appeal Division Reasons, para. 9)
(v) The words "good faith" are included in the test to "recognize that there is not misconduct merely because the licensee did not provide the documents quickly. If factors beyond the licensee's control (for example, mental health issues or computer problems) resulted in an inability to respond, there may not be a finding of misconduct." (Appeal Division Reasons, para. 9)
(vi) Evaluating the context requires looking at the nature of the requests, including whether the requests were for documents that the licensee is required to maintain in a form that can be promptly provided to the Society. "It would be inconsistent with the purpose of the duty to co-operate to find that a licensee's failure to comply with or be aware of their recordkeeping obligations was a good faith explanation for the delay." (Appeal Division Reasons, para. 10)
The Appellant's Submission with Respect to Good Faith
[33] According to the Appellant, the Appeal Division significantly narrowed the concept of good faith by limiting it to circumstances beyond the lawyer's control, such as mental health or computer problems. The definition of good faith is, in the submission of the Appellant, more robust than this. It requires looking at all of the conduct of the licensee and then assessing whether it was "honest, open and helpful". This does not require perfect compliance or compliance on a purely objective standard. A finding of professional misconduct should not be based on an error of judgment, but on a significant departure from the standards expected of the profession.
[34] In support of his position the Appellant cites the majority judgment in Groia, supra, where at para. 94, the majority of the Court states that "[t]he 'good faith' inquiry asks what the lawyer actually believed when making the allegations. The reasonableness of the lawyer's legal mistake is one piece of circumstantial evidence that may help a law society in this exercise. However, it is not determinative. Even the most unreasonable mistakes can be sincerely held." The Appellant swore an Affidavit in which he deposed that he made every effort to respond to the Law Society's requests and that any delay was due to confusion and lack of understanding. Thus, there is uncontradicted evidence from the Appellant that he genuinely believed that he was making every effort to co-operate. On the basis of Groia, the Appellant argues, it is clear that there is an important subjective component to the good faith analysis that the Appeal Division failed to consider.
[35] According to the Appellant, the Appeal Division consistently looked to the mere fact of delay and the fact that the Appellant ought to have provided or been able to provide what was requested. This amounted to putting the burden on the Appellant to disprove the allegation of professional misconduct. At all times the burden remained on the Law Society to prove a lack of good faith effort to co-operate.
Analysis
[36] In Groia, supra, the debate between the majority and the minority was a narrowly focused one. The issue the Court grappled with was whether a lawyer can be found guilty of professional misconduct when they have made a genuine mistake about the law. The Appeal Division of the Law Society in that case had held that where allegations of impropriety made against counsel stem from a mistake of law, the mistake must be both honest and reasonable in order to avoid a finding of professional misconduct on account of incivility. The majority of the Supreme Court of Canada disagreed, finding at para. 91 that subjecting a lawyer's sincerely held but mistaken belief about a legal position to a reasonableness analysis could have a profound effect on the administration of justice by "discourage[ing] lawyers from raising these allegations, frustrating the duty of resolute advocacy and the client's right to make full answer and defence."
[37] None of the countervailing policy considerations cited by the majority in Groia are present when it comes to the duty to co-operate. It is consistent with the purpose of the Rule respecting that duty and the positive obligation it imposes on lawyers, that it is not sufficient for a lawyer to have genuine or honest belief that they are fulfilling their duty to co-operate. The efforts to co-operate must be measured against the objective standard of reasonableness. As put by the Appeal Division at para. 17:
Even if he was confused, this would not be inconsistent with a finding that he failed to act in good faith to obtain and provide what he was required to have available to the Law Society. Licensees must understand their obligations and comply with them; a confused licensee who has not taken the time and effort to be aware of those obligations may be found to have engaged in misconduct.
[38] To find otherwise would allow a lawyer who has not taken the time or made reasonable efforts to understand and comply with their obligations to be immunized from regulation by the Law Society. This would be contrary to the public interest. As noted in Ghobrial, supra, at para. 9, when it comes to the licensee's duty to respond to Law Society requests for information completely and promptly "it is essential that the licensee treat the response as a priority."
[39] Consistent with its jurisprudence, the Appeal Division found that, in the context of the duty to co-operate, "good faith" is not the same as an absence of "bad faith". To understand this distinction it is useful to refer to some of the Charter jurisprudence from the Supreme Court of Canada. One of the factors that a court must consider in deciding whether to admit evidence that was obtained in a manner that violated the Charter is the seriousness of the Charter-infringing state conduct. Evidence that the police were acting in "good faith" may "reduce the need for the court to disassociate itself from the police conduct." (R. v. Grant, 2009 SCC 32, [2009] 2 S.C.R. 353 at para. 75). However, the court also made it clear that ignorance of Charter standards or negligence cannot be equated with good faith. Similarly, in the duty to co-operate context, a lawyer cannot be found to have acted in good faith to provide a complete and prompt response when the basis for their delay is their ignorance of their professional obligations or their negligence in making the efforts they are required to make to provide the requested information promptly. This reasoning is the basis for the Appeal Division's finding at para. 10 that "[i]t would be inconsistent with the purpose of the duty to co-operate to find that a licensee's failure to comply with or to be aware of their recordkeeping obligations was a good faith explanation for a delay."
[40] There is nothing unreasonable about the Appeal Division's analysis of the concept of "good faith". It does not hold lawyers to a standard of perfection. It imposes a duty on them to make every reasonable effort to comply with their obligations. This is consistent with the purpose of the Rule and the well-established jurisprudence concerning that Rule.
(b) Did the Appeal Division Improperly Conflate the Duty to Keep Records and the Duty to Co-operate?
[41] The Applicant submits that throughout its judgment the Appeal Division found that his failure to co-operate was supported by evidence of the mere fact that he had failed to maintain certain books and records. The requirement to co-operate and the requirement to keep books and records are two separate obligations. In his case, the Appeal Division was required to determine whether the Appellant had failed to co-operate. There was no longer any allegation that he had failed to maintain proper books and records.
[42] There is no question that in assessing whether the Appellant acted in good faith to provide a complete and prompt response the Appeal Division relied on the fact that the records the Appellant failed to produce upon request were records that he was required to keep.
[43] There was nothing unreasonable about the Appeal Division considering the obligatory nature of the records in assessing the good faith of his responses. The Appellant's professional obligation to keep certain records necessarily and properly informed the assessment of the Appellant's good faith efforts.
[44] As noted above, a good faith belief that one is co-operating cannot be unreasonable or based in ignorance. Negligence and wilful blindness are not good faith. A failure to abide by well-established professional obligations may be the basis for a finding of an absence of good faith.
(c) Were The Conclusions of the Appeal Division Unreasonable?
[45] According to the Appellant, taking the record as a whole, and subjecting it to a "somewhat probing examination", there is no reasonable route from the evidence to a finding of professional misconduct.
[46] I will deal with this submission by examining the Appeal Division's rationale for its finding of a failure to co-operate with respect to each of the four general categories of requests.
Categories 1 and 2: The General Receipts and Disbursements Journals
[47] The Appeal Division reviewed the sequence of events that unfolded with respect to these records from the time of the first request (October 17, 2016) until the date the necessary records were generated (July 4, 2017). According to the Appeal Division:
[15] It was open to the Vice-Chair to draw the inference that there was a lack of good faith openness and helpfulness as required by Rule 7.1-1, given the passage of time, the numerous explanations about what the Law Society was looking for and, most importantly, the fact that licensees are required to have such information readily available in case of an inquiry.
[16] Mr. Diamond argues, in essence, that the only reasonable explanation for these facts is that there was "confusion" about what had been asked for. We disagree. It was reasonably open to the Vice-Chair to conclude, as he did: 1) that the Law Society had proven that Mr. Diamond should not have been confused about the records he was required to keep, tracking money going into and out of his practice; and 2) that the time that had passed showed that Mr. Diamond had not made sufficient good faith efforts to locate and provide documents that are required to be readily available.
[48] Given the evidence that by the end of December of 2016 the Appellant had received a clear and simple explanation of the information the Law Society was seeking, that the Appellant had this information all along in his QuickBooks records and that the Appellant did not produce the QuickBooks records until June 22, 2017 ( eight months after the request was made), the Appeal Division's findings as articulated above were reasonable.
Bank Statements
[49] As the Appeal Division summarized, the Law Society asked for the Appellant's general account bank statements on October 17, 2016. The Appellant had two such accounts - one with the CIBC and the other a TD line of credit. The CIBC statements were provided in late December 2016/ early January 2017. The TD statements were not fully provided until June 22, 2017. Over that period the Law Society made four requests for the statements.
[50] The Appellant argued before the Appeal Division, as he did before us, that:
[21]…it is clear from the documentary evidence that counsel believed that the bulk of the Law Society's request had been fulfilled by December 28, 2016, and also believed that any outstanding statements were provided on February 24, 2017. He says that in all the circumstances, there was a timely provision of the accounts and that the real delay was because of misunderstandings about what had and had not been provided. He argues there is no rational path to the conclusion that Mr. Diamond failed to act in good faith to fulfil this request promptly and completely.
[51] The Appeal Division found as follows:
[22] It is not our role to reweigh the findings of fact and inferences the Vice-Chair drew. They are not unreasonable. Mr. Diamond's arguments ignore that such records are specifically required by By-Law 9 to be readily available, the number of times the requests were repeated (including in March 2017), and the two and one-half months that passed after they were requested again in March 2017 before they were received. The conclusion that Mr. Diamond did not fulfill his duties to be open, honest and helpful is reasonable.
[52] There is nothing unreasonable about the Appeal Division's conclusion. In this regard it is important to remember that the jurisprudence requires that in responding to requests from the Law Society the member must be "honest, open and helpful", take positive steps to make sure that the Society obtains what it needs and treat the response as a priority. In this case, the Appellant did not disclose the existence of the TD line of credit until the Law Society, in December of 2016, asked for a complete list of the bank accounts that the Appellant used at his firm. Further it took two more requests and another six months for the statements (which the Appellant was obliged to have readily available) to be provided.
Cancelled Cheques
[53] The Law Society asked for cancelled cheques on February 14, 2017. Another request was made on March 28, 2017. On April 7, 2017 the Appellant requested that the Society pay the costs of obtaining the cheques from the bank. The Society investigator said she would get instructions, but then moved to a new position at the Society and did not get back to the Appellant's counsel concerning this request. The Appellant's counsel never reiterated this request. At the end of May 2017, the Society investigator made another request for the cancelled cheques, which Mr. Diamond then ordered on June 12, 2017 and had available to produce on June 22, 2017.
[54] The Hearing Division found that by April 7, 2017 the Appellant had already breached his obligation to provide his cancelled cheques promptly and completely. Thus, the unanswered request for the Law Society to pay for these cheques was irrelevant. Further, the Appellant should never have made this request since it was his obligation under the by-laws to maintain cancelled cheques.
[55] The Appellant submitted before us, as he did before the Appeal Division, that this was unreasonable. A member is entitled to make suggestions about how a request should be fulfilled or to question the breadth of a request.
[56] The Appeal Division found as follows:
[27] The Vice-Chair's conclusions are reasonable. Under the By-Law, cancelled cheques must be kept and be available promptly. As later events showed, once the request was actually made of the bank, cheques were available within 10 days. In these circumstances, it was not unreasonable to conclude that Mr. Diamond had already violated his professional obligations to respond promptly by the time his counsel asked if the Law Society would pay, nearly two months after the request was made.
[57] The Appeal Division's finding was reasonable. Promptness and good faith must be assessed in context. In this case the cancelled cheques were only requested because the Appellant had not provided the bank statements or journals that the Society was seeking. The cheques should have been available immediately as the Appellant was required to maintain this information. It took almost four months for the Appellant to make the information available to be produced. According to the evidence, if the Appellant had made and followed through with his request to the bank for the cheques, the bank could have produced them in 10 days (well within the first deadline set by the Society of March 3, 2017).
Deposit Slips
[58] On February 14, 2017 the Law Society requested the deposit slips. In March Mr. Diamond advised the Society that he did not keep such slips. In June of 2017 he discussed the matter with his bookkeeper and discovered that he did in fact have deposit slips, which were provided to the Society on June 22, 2017 (over four months after the request was made).
[59] The Appeal Division found as follows with respect to the deposit slips:
[29] Mr. Diamond argues that his error and lack of knowledge that the slips were kept makes a finding of failure to respond promptly unreasonable. We disagree. These are documents that Mr. Diamond was required to keep and to have available. His lack of awareness of his professional obligations to keep deposit slips, his firm's practices, and his apparent failure to ask his bookkeeper until several months after the Law Society made its request, do not and cannot establish good faith co-operation with the investigation.
[60] Again, this conclusion is a reasonable one. Good faith is more than an absence of bad faith. Ignorance of one's obligations and a lack of reasonable efforts to fulfill those obligations (such as talking to one's bookkeeper) cannot constitute good faith.
Conclusion
[61] For these reasons the appeal is dismissed. As agreed by the parties, the Appellant is to pay the Law Society its costs of the appeal, fixed in the amount of $5,000, all-inclusive.
Sachs J.
I agree _______________________________
Linhares De Sousa J.
I agree _______________________________
Thorburn J.
Released:
CITATION: The Law Society of Ontario v. Diamond, 2019 ONSC 3228
DIVISIONAL COURT FILE NO.: 544/18
DATE: 20190529
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Sachs, Linhares De Sousa and Thorburn JJ.
BETWEEN:
The Law Society of Ontario
Respondent
– and –
Jeremy Dov Diamond
Appellant
REASONS FOR JUDGMENT
Sachs J.
Released: May 29, 2019