SUPERIOR COURT OF JUSTICE – ONTARIO

COURT FILE NO.: CV-10-416130
MOTION HEARD: 20111128
ENDORSEMENT RELEASED : 20120827

RE:

ALAN S. PRICE Plaintiff v. NIKOLOASO LAMBRINOS Defendant

BEFORE: MASTER D.E. SHORT

COUNSEL: Angela Assuras, Fax: 416-601-1462 ,
for the Defendant (moving party)

Alan S. Price , Fax: 416-214-5983
Plaintiff,

REASONS FOR DECISION

I. Action

[ 1 ] In December of 2010 Mr. Price sued his former client for $37,324.55 alleged to be owed in portions ranging from $131.00 TO $13,168.35 with respect to seven actions brought on behalf of Mr. Lambrinos against a variety of defendants and one action brought against him.

[ 2 ] Notwithstanding the amount claimed was well under $100,000 it does not appear that the action was brought by the former solicitor under the simplified procedure provisions of Rule 76. Rule 76.02(1) would appear to make the use of the simplified system mandatory as the plaintiff’s claim appears to be exclusively for “money”. In fact, if the claim was fully proven it would still be within the then current jurisdiction of the small claims court.

[ 3 ] Nevertheless, the case seems to have involved court resources not in keeping with what I would regard as "proportional" taking into account the direction of rule 1.04(1.1) which came into force eleven months prior to the commencement of this action.

II. Motion

[ 4 ] This motion was heard in November of 2011. The issue should have been relatively easy to address but a number of circumstances resulted in an inordinate delay in the delivery of these reasons. I express my regret to both sides in that respect.

[ 5 ] The plaintiff in this action is a solicitor. The relief sought by the defendant is principally made up of three items:

1. leave to amend the existing statement of defence in the feeds action and to add a counterclaim;

2. an order that the plaintiff deliver up his file on a specific matter, Lambrinos v. AGCO, and any other files in his possession which the plaintiff has previously been ordered to deliver up; and

3. an order that the plaintiff deliver up his file in the matter Lambrinos ats Seitag and any other file where there is no outstanding invoice with respect to each such matter.

[ 6 ] English is not their native tongue of the defendants a Lambrinos. He deposes to having a grade 4 elementary school education from Greece. When the original defence was delivered he was self represented. He is now represented in his new counsel seeks to amend a pleading by way of delivery of a Fresh as Amended Statement of Defence and Counterclaim.

[ 7 ] There was a prior motion in this matter, heard by Master Dash on March 2, 2011. At that time, he ordered the plaintiff to deliver up his file in the matter Lambrinos v. AGCO.

[ 8 ] Counsel for the defendant asserts that only part of the file was actually delivered. In particular, it is asserted that as of the month before the motion, the plaintiff continued to maintain an accordion folder labelled Lambrinos v. AGCO and refused to release its contents to the plaintiff.

[ 9 ] The defendant asserts that the folder contains correspondence and medical records and "other relevant documents".

[ 10 ] Apparently Mr. Price retained other files for matters involving Mr. Lambrinos, where it is admitted no outstanding fees are owed with respect to the specific files.

[ 11 ] The issue is whether or not, by virtue of an alleged solicitor’s lien on one matter, the solicitor can refuse to deliver up the documentation on the other matters, where those file materials remain in the solicitor’s possession.

III. Interim Order

[ 12 ] Following argument on the motion, I made an order with respect to part of the relief sought. That order provided that, on the agreement of the plaintiff during argument:

(a) counsel for the defendants could attend with materials already in the control of Mr. Lambrinos for the purposes of determining any "unproduced" material.

(b) with respect to correspondence files on all matters "still active", access to correspondence file shall be given and copies of any portions may be made at the client's cost.

(c) the Torgo file may be inspected and any useful material may be copied by counsel for the defendants;

(d) Mr. Price advises plaintiff's injuries in the Metro Police action were covered by same medicals as in then AGCO file material in his custody. These may be inspected and copies made if necessary.

[ 13 ] Following argument I took the balance of the matters sought in the motion under reserve pending delivery of these reasons.

[ 14 ] What remained were of the entitlement to the files, the question of leave to file an amended pleading and the costs of this entire exercise.

[ 15 ] In his materials filed on the motion, Mr. Price indicates he would have consented to the amendment of the statement of defence had he been asked to do so prior to the motion being brought. As a consequence leave to amend the pleading in the form found as Schedule “A” to the Notice of Motion, effective as of the date of the Notice, November 7, 2011, is hereby granted.

[ 16 ] For the purpose of responding to it that pleading, it shall be deemed to have been served on the plaintiff, seven days following the date of issuance of these reasons.

[ 17 ] With respect to the balance of the relief sought, it is necessary to consider the plaintiff's position in light of the existing case law.

IV. Caselaw Context

[ 18 ] More than thirty years ago, my current colleague Master David Sandler undertook a careful analysis of the appropriate approach to cases such as the one presently under consideration in Aggio v. Rosenberg, [1981] O.J. No. 2229 ; 24 C.P.C. 7 . He, in particular, considered the leading text at the time, Cordery, Law Relating to Solicitors (6th ed.) at pp. 118-119. Thereafter he set out his view as to the law of Ontario:

“15 As to what the law in Ontario is, I adopt the law as set out in Cordery , supra , as follows:

"D. AUTHORITY OVER DOCUMENTS ON TERMINATION OF RETAINER

Documents in existence before the retainer commences and sent to the solicitor by the client or by a third party during the currency of the retainer present no difficulty since their ownership must be readily apparent. The solicitor holds them as agent for and on behalf of the client or third party, and on the termination of the retainer must dispose of them (subject to any lien he may have for unpaid costs - see pp. 416 et seq., post) as the client or third party may direct.

Documents which only come into existence during the currency of the retainer and for the purpose of business transacted by the solicitor pursuant to the retainer, fall into four broad categories:

(i) Documents prepared by the solicitor for the benefit of the client and which may be said to have been paid for the client, belong to the client.

(ii) Documents prepared by the solicitor for his own benefit or protection, the preparation of which is not regarded as an item chargeable against the client, belong to the solicitor.

(iii) Documents sent by the client to the solicitor during the course of the retainer, the property in which was intended at the date of despatch to pass from the client to the solicitor, e.g., letters, belong to the solicitor.

(iv) Documents prepared by a third party during the course of the retainer and sent to the solicitor (other than at the solicitor's expense), e.g., letters, belong to the client."

16 From these broad categories, specific propositions are then laid down at p. 119 as follows:

"Cases, instructions and briefs prepared by the solicitor and delivered to counsel belong to the client within category (i).

Drafts and copies made by the solicitor of deeds or other documents in non-contentious business belong to the client within category (i).

Copies made by the solicitor of letters received by him, if paid for by the client belong to the client under category (i).

Copies made by the solicitor of letters received by him, if not paid for by the client belong to the solicitor under category (ii).

Copies made by the solicitor of letters written by him to third parties, if contained in the client's case file and used for the purpose of the client's business belong to the client under category (i).

Copies made by the solicitor of letters written by him to third parties, if contained only in a filing system of all letters written in the solicitor's office belong to the solicitor, under category (ii).

Entries of attendance, tape recordings of conversations, etc., inter-office memoranda partner to partner, partner to staff, entries in diaries, office journals and books of account belong to the solicitor under category (ii).

Letters and authorities and 'instructions written or given' by the client to his solicitors belong to the solicitor under category (iii).

Letters received by the solicitor from third parties belong to the client under category (iv).

Vouchers for disbursements made by the solicitor on behalf of his client belong to the client under category (iv)."

17 In (1981) 15 L.S.U.C. Gaz. 103, there is to be found a helpful article prepared and published at the suggestion of the Committee of Professional Conduct of the Law Society of Upper Canada entitled "A Lawyer's Authority over Documents on Termination of Retainer". The article opens with the following statement:

"The documents that should be handed over to a client who is in the process of changing lawyers is a matter of law (my emphasis) and not of professional conduct.

If a lawyer receives a direction that he forward all documents and correspondence relating to a client's affairs to another lawyer, he should, subject to the payment of fees do so as quickly as possible. The lawyer however, is obliged to deliver only those documents that are the property of the client."

18 The article then details what documents, letters, vouchers and notes are the property of the client and which are the property of the solicitor, following the law laid down in Cordery, supra.

19 In this case, the major documents in issue concern letters received by the defendant solicitors from third parties, and copies made by the said solicitors of letters written by them to third parties contained in the client's case file and used for the purpose of the client's business, and vouchers for disbursements made by the said solicitors on behalf of the client, all of which, until March 30th, 1981, the solicitors insisted belonged to them and not the client. This action was necessary in order for the client to have delivered up to her, her property. The documents that should be handed over "is a matter of law", and who better than a solicitor should know or be able to ascertain what the law is. In this case, the law was easily ascertainable by reading Cordery or other authorities.

20 I should say that the defendant firm was trying to act reasonably, although they were legally wrong in the position they took, and the duty of solicitors in his area is sufficiently unfamiliar so as to move the Law Society to publish the article they did, supra . Notwithstanding this, the plaintiff was legally correct and was obliged to institute this action to assert her rights and, in my view, is entitled to her costs of this action, including the cross-examination and this motion for judgment, forthwith after taxation.”

[my emphasis in the above paragraph]

[ 19 ] More recently Justice D.C. Shaw in Thunder Bay, in Bowman v. Rainy River (Town) [2007] O.J. No. 1235 ; 156 A.C.W.S. (3d) 563 , was dealing with a leave to appeal application which dealt in part with an alleged right to refuse to deliver a solicitor’s file to a former client. His reasons assist in the demarcation between those that may generally be retained and other materials to which the client is entitled:

[ 20 ] “33 On the issue of production and particulars I am not satisfied that the Town has established that there is good reason to doubt the correctness of the decision of Smith J. The law as stated in Tersigni, Spencer, Aggio and Cordery is, in my opinion, accurately characterized by Smith J. as "well-settled." While I am of the view that the statement of Smith J. that "documents that have been prepared by the solicitor are not the property of the client and not producible," is too wide, that statement does not affect the correctness of the decision on the issue before him. There are certain documents which are prepared by a solicitor which do in law belong to the client, as detailed in Cordery at. p. 119. However, the specific documents which were under review by Smith J. do not fall within those classic categories of documents producible to a client. The evidence of the nature of those documents was set out in the affidavits filed on behalf of WMN. They were solicitors' notes, time dockets, internal memoranda, internal emails and the firm's computer generated internal billing records. These documents belong to the solicitor. ”[my emphasis]

[ 21 ] Similarly in 2001, Master Haberman addressed related issues in Metrin Mechanical Contractors Ltd. v. Big H Construction Inc., 10 C.P.C. (5th) 302 ; 103 A.C.W.S. (3d) 1058 . There she considered a number of factors:

45 The case law in the area of solicitor's liens appears to deal with 2 distinct scenarios; cases where the client terminates the solicitor-client relationship and cases where the relationship ends at the behest of counsel. It is summed up succinctly by Quinn J. in Linauskas v. Linauskas (No. 2) , (1998), 38 O.R. (3d) 113 , at page 117, as follows:

Simply put, a general retaining lien allows an unpaid solicitor to hold personal property of the client that comes into the solicitor's possession in the course of representing the client. Obvious examples would be documents, photographs, videotapes, papers and the like. The lien is intended to stand as some security for the debt owed. And it would be naive not to acknowledge that the solicitor is well aware that the client may be somewhat inconvenienced by the lien; indeed, that is part of the effectiveness of the lien. If a dispute arises as to the legitimacy of the lien, the dispute is a question of law and can be resolved by a court.

Where a solicitor is discharged by the client without cause, the solicitor is entitled to a lien; and where a solicitor removes himself or herself from the record without cause, the lien is lost.

46 In that case, Quinn J. explored a situation where there was cause, as the solicitor had been constructively dismissed. There, he found the solicitor could avail himself of a lien over the file.

47 Counsel have directed me to no cases dealing with a situation akin to the case at bar, where it was the Court that terminated the relationship between the solicitor and the clients on the basis of an alleged conflict raised by another party to the action. As a result, it becomes necessary to explore in greater depth what it is that a solicitor's lien is intended to achieve. In this regard, the words of Steele J. in Appleton et al. v. Hawes et al. (1990), 46 C.P.C. (2d) 107 provide some assistance.

48 There, Steele J. dealt with, amongst other things, a motion by one party for the release of its file from its former counsel. Counsel had been removed from the record by court order, but the nature of the motion that led to the order is not revealed as the motion materials were sealed, also by court order.

49 Steele J. quotes from Hughes v. Hughes , [1958] 3 All E.R. 179 (C.A.) to support his approach. In Hughes, the Court states, at pp. 180-181, as follows:

It would be odd if he were, in effect, able to get solicitors' work done for nothing by the simple expedient of changing his solicitor as often as he chose, leaving a trail of unpaid costs in his wake and demanding the papers without payment when he had no just cause to complain of the conduct of the solicitors instructed and discarded

50 In Appleton , Steele J. stated, at page 111:

Rule 8.10 of the Rules of Professional Conduct provides that upon the discharge of a solicitor who has a lien "he shall have due regard to not unduly prejudicing his client's position." This is not binding upon the Court but must be taken into consideration as a professional ethic. In my opinion, the interests of the client must be given great weight. If the client merely moves from solicitor to solicitor to avoid paying fees, then obviously this weighty consideration would not apply. It is not clear that such is the present case.

51 It seems to me that the rationale behind a solicitor's lien is largely to prevent a party from "lawyer shopping" mid-way through a matter, after running up an account. Where a party, of his own volition, chooses to change counsel in a context which cannot objectively be viewed as counsel's fault , the latter should have some means to ensure that, at the end of the day, his account is paid. A solicitor's lien is the mechanism that has been devised to apply some pressure to the client who initiates such a process.

52 The focus, then, in assessing whether or not such a mechanism is available, is on whether or not the client voluntarily initiated the process. If that is the case, one then must continue by exploring whether the termination of services was justified from the client's perspective.

53 Here, the process was not initiated by the client. The motion was brought by another party to the action and the removal of the solicitor from the file, or files here, was the result of court order. In such circumstances, the mischief that a solicitor's lien is aimed at preventing was not present and there is no basis, in my view, for supporting its availability.

55 Accordingly, the files are to be returned to the clients, as set out in my endorsement of February 15, 2001. By way of addendum to paragraph 3 of that endorsement, in view of the outstanding assessment of the accounts the quantum of the charging order is to be modified as and when the accounts are assessed, to reflect the amounts at which they are assessed.”[my emphasis throughout]

[ 22 ] the plaintiff relied on two cases, Appleton v. Hawes 2 W.D.C.P. (2d) a 1990 judgment of Justice Steele and Green v. F.W. Woolworth Co.., a 1992 decision of Master Clark. . I did not find either case to be particularly helpful in the circumstances of this case.

[ 23 ] In the latter case the motion was brought on the eve of trial with respect to three actions. The Master directed the documents to be released on the condition that the proceeds from the actions would be paid in the court.

[ 24 ] That it was his "considered opinion." that:

“...an order requiring a solicitor to give up a clients file does not determine the solicitor’s right of property in the file. The solicitor has no such right of property, except to be paid for his work by giving up the file, the solicitor does not give up that right."

[ 25 ] The phrase also provided me with the 2007 version of the Law Society’s Article on Solicitors Liens and in the commentary on Rule 2 dealing with “Relationship to Clients”.

[ 26 ] Rule 2.09 Dealing with Withdrawal from Representation reads in part:

"Where upon the discharge or withdrawal of the lawyer, the question of a right of lien for unpaid fees and disbursements arises, the lawyer should have due regard effect of its enforcement upon the client's position. Generally speaking, the lawyer should not enforce the lien if to do so would prejudice materially the client's position in an uncompleted matter.”

[ 27 ] Here, the plaintiff asserts that he is retaining the documentation will not materially prejudice the client’s position. However, the only sworn evidence on the point is a lengthy affidavit from the client detailing a number of elements of possible prejudice. That alleged prejudice gave rise to an extended cross examination.

[ 28 ] The only evidence to the contrary before me was an affidavit from a legal assistant (not on information and belief) working in the offices of Mr. Price that deposes that a listed group of materials had been provided to the client after Mr. Lambrinos attended at Mr. Price's office and paid $2500 amount established pursuant to the order of Master Dash made earlier in the year.

[ 29 ] The legal assistant deposes that in her view;

"... This material was more than sufficient for counsel to continue to prosecute the claim and the delivery of the material was so as not to prejudice materially the Defendant’s position in any uncompleted matter."

[ 30 ] The affidavit concludes with the statement that:

“It is the Plaintiff's position that he has met all of his obligations under Rule 2.09 of the rules of Professional Conduct of the Law Society of Upper Canada and that he is entitled to maintain his solicitor’s lien rights on the balance of the material that remains in his possession."

V. Factual Context

[ 31 ] What to my mind distinguishes this case from predecessors is the real issue as to whether or not, in fact, any monies are owing, on a net basis, to the solicitor.

[ 32 ] The counterclaim addresses alleged claims for breach of the judiciary duty. In part the pleading reads:

21, ,,, The plaintiff by counterclaim has no knowledge of his rights and relied entirely upon the skill, judgment and advice (as IC) of the defendant by counterclaim, who held himself out as having knowledge and skill. For the defendant by counterclaim had a fiduciary duty to act in the best interest of the plaintiff by counterclaim.

22. In breach of his fiduciary duty, the defendant by counterclaim failed to recommend to the plaintiff by counterclaim that he seek out and retain a solicitor who practiced primarily in the area personal injury litigation respect to the personal injury claims the plaintiff by counterclaim. It is customary to personal injury lawyers assume carriage of personal injury litigation on a contingency basis. The defender by counterclaim assume carriage of two personal injury actions and rendered interim bills over the years to the plaintiff by counterclaim based on an hourly rate of $450, which later was increased to $600 without due and the plaintiff by counterclaim states that according to the ledger of the defendant by counterclaim, the plaintiff by counterclaim has paid the defendant by counterclaim the sum of $45,712.27 to prosecute the two personal injury actions when they could have been prosecuted by a personal injury lawyer on a contingency basis. Both personal injury actions have yet to be tried.

[ 33 ] The affidavit filed by Mr. Lambrinos further indicates that Mr. Price is seeking an additional $15,701.67 with respect to the two files.

[ 34 ] The material filed by Mr. Price does not address a further concern raised in the affidavit with respect to the validity of the AGCO action. This is a claim against the alcohol and gaming commission of Ontario, arising out of an alleged injury, which took place in a casino in Ontario.

[ 35 ] That paragraph reads in part;

“49. ...Mr. Price had incorrectly commenced the action against the AGCO when he should have commenced it against the Crown and he failed provide [sic] notice to the Crown under the Crown Proceedings Act, which led to the defendants stating that the action was statute barred.”

[ 36 ] Two affidavits by legal assistance in the office of Mr. Price were filed on the motion before me. Both were sworn in the month that the motion was heard. No affidavit was filed by Mr. Price personally. I see nothing in the material to refute the allegations set out in the paragraph above.

[ 37 ] Mr. Price of to examine is former client of the affidavits filed a transcript is 105 pages in length with over 450 questions being asked. For what I have concluded is largely a previously resolved issue of law, I find this to be an excessive examination and somewhat impressive.

[ 38 ] Where the conduct of the solicitor is put in issue with respect to the manner in which the file has been handled, there is a real question as to whether or not any funds are in fact, owned by the previous client. In such circumstances, the position of the former client ought to prevail.

[ 39 ] In balancing the question of material prejudice and taking into account both proportionality and the manner in which this litigation has been conducted to date. I am satisfied that less prejudice will be suffered if the order sought by the defendant is granted at this time.

[ 40 ] In my view, the law is clear and applying the new gloss of proportionality, I am even more convinced that in a case such as this, the client ought to be entitled to recover his property to permit the most effect of prosecution of his action to endeavour to recover compensation for his alleged damages.

[ 41 ] That being said, I do accept the limitation suggested by Justice Shaw with respect to production of documentation in cases such as this. As a consequence, the solicitor is not required to deliver up pursuant to this order, the “solicitors' notes, time dockets, internal memoranda, internal emails and the firm's computer generated internal billing records. These documents belong to the solicitor.”

[ 42 ] However, I do not purport to in any way restrict entitlement to production of all proper documentation within the normal discovery process in this continuing litigation.

VI. Disposition

[ 43 ] Based on upon the foregoing analysis in order will go:

(i) granting leave to amend the statement of defence and counterclaim in the form attached as schedule "A" to the notice of motion;

(ii) directing (subject to the limitation in paragraph 49 above) the plaintiff to deliver up his file in the matter Lambrinos v. AGCO in the possession of the plaintiff and any other files in his possession that the plaintiff has been ordered by the court to deliver up; and

(iii) directing the plaintiff deliver as well his files in the matter Lambrinos ats. Seitaj and any other files for which there is no outstanding invoice:

(iv) awarding the costs of this motion on a partial indemnity basis to the defendant payable within 45 days without setoff.

Master D. E. Short

DATE: August 27, 2012

DS/ E52

Supplementary Direction re Costs Submissions

If the issue of the quantum costs cannot be resolved on agreement between the parties, I order the following timetable for the delivery of written costs submissions:

from the party seeking costs, a costs outline, maximum three pages in length inclusive of schedules and appendices, shall be delivered by not later than fifteen days from the release date of the reasons on this motion.

responding costs submissions, maximum three pages in length inclusive of schedules and appendices, shall be delivered within 15 days of receipt of the above costs outline; and

a reply, if needed, maximum two pages in length inclusive of schedules and appendices, shall be delivered within 7 days of receipt of the responding submissions.

The party seeking costs shall deliver all written costs submissions in one complete package within 10 days following the delivery of the responding costs submissions, and in any event by no later than 45 days from the date of the reasons, directly to David Backes at the Case Management Office, 393 University Avenue, 6 th Floor, Toronto, Ontario.

In the event that I do not receive costs submission in accordance with the above timetable, there shall be no costs of the motion to either party.