Court File and Parties

Court File No.: LS017/10
Date: 2012-12-11
SUPERIOR COURT OF JUSTICE - ONTARIO

RE: The Law Society of Upper Canada, Applicant
David Grant Isaac, Respondent

BEFORE: Madam Justice Darla A. Wilson

COUNSEL:
Nadia Musclow , Counsel for the Applicant
David Grant Isaac in person

HEARD: December 10, 2012

ENDORSEMENT

[ 1 ] The Applicant, The Law Society of Upper Canada [“LSUC”] brought this motion originally returnable June 12, 2012, for an order discharging the trusteeship which was made pursuant to the order of Justice Penny dated February 1, 2011. In order to put the motion before me in context, it is necessary to briefly review the history of this matter.

[ 2 ] The original order appointed the LSUC as Trustee to take possession of all files and other documents that were in the possession of the Respondent at his law practice for the purpose of preserving the property and/or winding up the professional business of the Respondent. The order provided that the Respondent or any person affected by the order could apply to the court pursuant to s. 49.51 of the Law Society Act to vary or discharge the order. That was not done.

[ 3 ] The LSUC attended at the office of the Respondent and took possession of some client files and other records. In accordance with paragraph 11 of the order of Penny J., the LSUC shredded some files that had been inactive for 10 years. The LSUC reported to the court on several occasions.

[ 4 ] The Respondent brought a motion for a declaration that the Order of Justice Penny was void. This motion was dismissed by Justice Stinson with written reasons. Of note, Mr. Isaac argued before Stinson J. that the Order of Justice Penny was made without jurisdiction. Justice Stinson rejected this argument and set out the reasons for this determination. Mr. Isaac also advanced the argument that the LSUC had no authority to shred client files that had been inactive for at least 10 years. In his written reasons, Justice Stinson dismissed these submissions noting that the Law Society Act provides for the winding up of a professional practice which includes making arrangements for the storage or destruction of client files, which was done in this case. Costs were ordered payable by the Respondent.

[ 5 ] Although Mr. Isaac served a notice of appeal of Justice Stinson’s decision, the appeal was not perfected and it was dismissed.

[ 6 ] On June 12, 2012, the LSUC brought a motion for discharge, having completed the administration of the trusteeship. This motion was adjourned by Lederer J. to permit Mr. Isaac to proceed with his appeal. I have read the transcript of the proceedings before Justice Lederer and note that many of the submissions made by Mr. Isaac before me today were exactly the same as were made to Justice Lederer 6 months ago on the original return date of the motion. In any event, the motion was further adjourned by Justice Whitaker on July 20, 2012 as the Respondent had only just filed his notice of motion with respect to his appeal.

[ 7 ] The Respondent’s motion to restore his appeal was heard and dismissed by Justice Juriansz on September 26, 2012. Mr. Isaac then served a motion to set aside Justice Juriansz’s decision. On October 16, 2012, the LSUC’s motion was adjourned a third time by Justice Chapnik to enable the Respondent to prepare his motion to set aside the Court of Appeal dismissal. At the time the LSUC’s motion was brought before me, there was no motion in the Court of Appeal brought by Mr. Isaac with respect to the order of Justice Juriansz.

[ 8 ] At the outset of the motion, the Respondent submitted that the counsel for the LSUC, Ms. Musclow, ought not to be permitted to argue the motion pursuant to s. 49(53) of the Law Society Act . However, I rejected this submission as Ms. Musclow has no involvement with the Discipline Department of the LSUC and in my view, this section has no applicability to the facts before me. There is no conflict of interest as alleged by Mr. Isaac. I therefore proceeded to hear the motion, noting that the Respondent had chosen not to file any material despite the various adjournments.

[ 9 ] In response to my inquiries of Mr. Isaac as to the basis for his objection to an order of discharge being made, he repeated the same arguments that he has made before other members of the court since December 2011. Specifically, he submitted that the initial order of trusteeship made by Justice Penny was made without any jurisdiction. I advised the Respondent that I would not hear further submissions on this point since a review of the initial order and its propriety must be made through an appeal and this issue had already been adjudicated upon.

[ 10 ] The Respondent argued that the LSUC destroyed files without any right to do so and he did not want to be blamed for this action. Again, I noted that Justice Stinson specifically dealt with this issue in his written reasons dismissing the Respondent’s motion. I advised Mr. Isaac on numerous occasions during his argument that I needed to hear the basis for his position that the order of discharge ought not to be made, but he failed to address this issue. He advised the court that it is his intention to commence a claim against the LSUC for damages for their actions.

[ 11 ] The undisputed evidence before me indicates that the LSUC recovered the sum of $21,752.44 from the trust account of the Respondent and that no distribution of monies has taken place. Further, the LSUC recovered 967 client files and 970 original wills, all of which have been indexed and stored with the LSUC. The LSUC has responded to various inquiries from clients or former clients of the Respondent.

[ 12 ] The affidavit of Lawrence Hadbavny sworn May 29, 2012 deposes that there are no outstanding matters that require the services of a trustee and it is an appropriate time to discharge the trusteeship. Costs are sought by the LSUC as well.

[ 13 ] In my view, the submissions made by the Respondent are entirely without merit. The order of Justice Penny has not been varied. The evidence before me indicates that there is no further need for the trusteeship and I therefore make an order that the trust be terminated and the trusteeship of the Applicant be discharged.

[ 14 ] This motion ought not to have been opposed, let alone adjourned 4 times due to the position taken by the Respondent. This conduct and refusal to deal with the motion on its merits only increased the costs and delayed the matter. I reject the submission of the Respondent that he is entitled to costs. It was the conduct of the Respondent that led to unnecessary expense and costs incurred by the Applicant and the LSUC is entitled to payment of its costs.

[ 15 ] In my view, a review of the history of this matter makes it abundantly clear that the order of Justice Penny was properly made based on the evidence before him. The Applicant acted pursuant to that order and is entitled to payment pursuant to s. 49.47(7) of the Law Society Act . I fix the compensation and costs of the LSUC as trustee in the sum of $31,694.42. The funds currently held in trust by the Applicant in the amount of $21,752.44 shall be paid to the LSUC in partial payment of its costs and compensation for this matter. The balance owing, namely $9,941.98, shall be paid by the Respondent to the Applicant forthwith.

[ 16 ] An order shall go that service of the motion materials on the Respondent constitutes good and sufficient service. Approval of this order and service of it on the Respondent is hereby dispensed with.

D.A. Wilson J.

Date: December 11, 2012