CITATION: Bulloch-MacIntosh et al. v. Browne et al. 2015 ONSC 1622
COURT FILE NO.: 96-CU-114450CM
DATE: 20150318
SUPERIOR COURT OF JUSTICE
BETWEEN:
WENDY MARGARET BULLOCH-MACINTOSH and WENDY MARGARET BULLOCH-MACINTOSH, ESTATE TRUSTEE FOR THE ESTATE OF JAMES MACINTOSH,
Plaintiffs (Moving Parties)
– and –
GRAEME BROWNE and RICHARD EMERY
Defendants (Respondents)
John Legge and David Steeves, for the Plaintiffs
Jamie Macdonald, for the Defendant Richard Emery
James Newland and Neil Wilson for the Ontario Health Insurance Program
Graeme Browne, In Person
Craig O’Brien, for Norton Rose
HEARD: March 2, 2015
REASONS FOR DECISION
firestone j.
[1] The trial of this matter was scheduled for March 2, 2015. Prior to the commencement of trial I heard the plaintiff’s motion for an order that, among other things, Norton Rose Fulbright (“Norton”), the current solicitors of record for Dr. Emery (“Emery”), be removed as a result of a disqualifying conflict of interest arising from their prior representation of the co-defendant Dr. Graeme Browne (“Browne”). On this motion, I heard oral submissions and in addition requested and received subsequent written submissions.
BACKGROUND
[2] On November 19, 1996, the plaintiffs commenced a lawsuit in which they alleged negligence against a number of defendants which included the two defendant oral surgeons, Browne and Emery. The action has been dismissed or discontinued against all defendants except Browne and Emery. Both doctors performed surgeries in 1977 and 1978 in which the plaintiff Wendy Margaret Bulloch-MacIntosh was implanted with bilateral silastic temporomandibular joint devices. After performing the original surgery, Browne left Canada in 1977 and ceased to be involved in the plaintiff’s care. Emery continued to care for the plaintiff from 1978 until 1996. The plaintiffs allege negligence with regard to the initial surgical procedure performed by Browne as well as the subsequent care provided by Emery from 1978 to 1996.
[3] Ogilvy Renault LLP (“Ogilvy”), which merged with Norton in June 2011, was retained by Browne in 1999 to defend him in the action. Ogilvy also jointly represented and continues to represent Emery. On June 2, 2011, after representing Browne for 12 years, Norton obtained an order removing the firm as lawyers of record for Browne. Browne resides in the U.S. He did not retain new Ontario counsel. He continues to represent himself with the assistance of his U.S. attorney, Mr. Strothman (“Strothman”) who has been assisting him from the outset.
[4] At the outset of this litigation, Strothman advised Ogilvy in correspondence dated March 25, 1999 that Browne understands there could be a future conflict with Emery and that if such a conflict arises such that Ogilvy could no longer act for him, he consents in advance to their withdrawal from representation of him and accepts that they may continue to act for Emery. Strothman stated as follows:
Dr. Browne understands that there may be a potential future conflict with Dr. Emery should evidence arrive somewhere, somehow that suggests there is such a conflict. He will rely on your determination in that regard which can be made at any time. If you do ascertain such a conflict exists such that you can no longer represent Dr. Browne, he is consenting in advance to your withdrawing at that time from representation of him and accepts that you can continue to act for Dr. Emery. He also understands that conceptually, you might obtain information during your representation of him which could be used against him. He places no constraints upon you in that regard. (As I have indicated, he doesn’t have any files or records so such information is going to come from another source, if it exists, and therefore, your representation of Dr. Browne should not lead to its discovery).
[5] In that correspondence Browne through Strothman gave his consent in advance for his former solicitors to act against him in the same matter in which confidential information was obtained.
[6] This agreement changed in or around the time Norton removed itself as lawyers of record in 2011. An email from Strothman to Norton dated October 31, 2014 states in part:
Dr. Browne has requested that I remind your firm at the time of its withdrawal from representing Dr. Browne it assured Dr. Browne that it could not and would not in any way be adverse to him in the Bulloch litigation. If Dr. Browne’s summary judgment motion does not result in his full and final dismissal from this litigation, Dr. Brown’s cross-claim will remain if leave to amend in that fashion is granted. If leave is not granted the claim of Dr. Browne does not go away. He assumes that Norton Rose will not defend Dr. Emery against Dr. Browne’s claim since that would be acting adverse to Dr. Browne. Please confirm that Norton Rose will not act in any way adverse to Dr. Browne.
[7] Norton acknowledges in its factum that, at the time it was removed as lawyers of record for Browne in 2011, it agreed that it could not, and would not, act in a manner adverse to Browne’s immediate interests. This agreement in my view modifies and/or overrides the initial waiver of any conflict arising from Norton’s joint representation of both doctors as contained in Strothman letter dated March 25, 1999.
[8] Browne alleges he learned for the first time at his discovery in September 2014 of the potential adversity of interest between himself and Emery. Following this revelation, in October 2014 Browne obtained leave to file an amended Statement of Defence and Cross-claim against Emery. In this Cross-claim, Browne specifically states that:
For the purposes of this Cross claim only, Dr. Browne adopts and repeats the allegations asserted by the Plaintiffs against the Defendant Richard Emery as set out in their Fresh as Amended Statement of Claim to the extent as may be supported by the Plaintiff Bulloch in this litigation.
[9] At the preliminary pre-trial motion before me on March 2, 2015, Browne was called on consent to give viva voce evidence. He testified that he did not impart any relevant verbal or documentary confidential information to Ogilvy or Norton which has not yet been produced in this litigation. In a later memorandum to the Court, Browne clarified that he did not believe any of the information in Norton’s possession was confidential such that it should be held back from the Court or himself.
[10] It appears that Browne misunderstood the question when he was asked whether Norton possessed any relevant confidential information. The basis of Brown’s alleged conflict was that Norton should have advanced a defense on his behalf on the basis of the Statute of Limitations; that other doctors were released from the action but he was not; and that there was a financial conflict because Norton had requested an additional $10,000 retainer in 2011. Browne’s concerns seem primarily directed at events during Norton’s representation of him.
ISSUE FOR DETERMINATION
[11] The issue on this motion is whether Norton should be removed due to a conflict given the agreement that Norton could not and would not act in a manner adverse to Browne.
POSITIONS OF THE PARTIES
[12] The moving party plaintiffs ask that Norton be disqualified from representing Emery. The plaintiffs contend they are not raising the conflict issue tactically but that they have repeatedly raised the potential conflict since the plaintiffs say it first manifested in August 1999. At that time, the plaintiffs could and did not know what consents or waivers were in place between Norton and the doctors. There is nothing before me to suggest a conflict then in any event. When the potential conflict crystallized in October 2014, the plaintiffs amplified their objection. The plaintiffs also contend that they are substantively and irretrievably prejudiced by the conflict because of the likelihood of a mistrial.
[13] OHIP, whose subrogated claim is being advanced, takes the position that Emery and Browne are adverse in interest and the continued representation of Emery by Norton would compromise the fairness of the trial and risk bringing the administration of justice into disrepute. Any procedural orders that may attempt to regulate the trial to avoid the adversity between Browne and Emery would be difficult to implement.
[14] The defendant Emery and Norton argue that the motion to remove Norton as counsel of record for Emery is an attempt by the plaintiffs to gain an undeserved tactical advantage on false pretenses. Removing Norton as counsel would prejudice Emery and have significant adverse cost consequences to him as new counsel are brought up to speed. Moreover, Norton can continue to represent Emery because, as Emery is not defending the cross-claim, Emery is not taking a position adverse in interest to Browne.
ANALYSIS
Conflicts of Interest and the Duty of Loyalty
Rules of Professional Conduct
[15] The Law Society of Upper Canada’s Rules of Professional Conduct provide guidance for the courts on the question of disqualifying conflicts of interest. As the Supreme Court of Canada recognized in Canadian National Railway Co. v. McKercher LLP, 2013 SCC 39, [2013] 2 S.C.R. 649, at para. 16, courts and law societies are both involved in resolving issues relating to conflicts of interest and may have regard to each other’s views. Courts are not “bound by the letter of law society rules, although ‘an expression of a professional standard in a code of ethics … should be considered an important statement of public policy’: Martin, at p. 1246.”
[16] The Rules of Professional Conduct are clear that, absent consent, a lawyer shall not act against a former client in the same or a related matter. Rule 3.4-10 states:
Unless the former client consents, a lawyer shall not act against a former client in
(a) the same matter,
(b) any related matter, or
(c) save as provided by rule 3.4-11, any other matter if the lawyer has relevant confidential information arising from the representation of their former client that may prejudice the client.
[17] In its Commentary on this section, the Law Society writes:
[R]ules 3.4.10 and 3.4-11 address conflicts where the lawyer acts against a former client. Rule 3.4-10 guards against the misuse of confidential information from a previous retainer and ensures that a lawyer does not attack the legal work done during a previous retainer or undermine the client’s position on a matter that was central to a previous retainer.
[18] The Rules of Professional Conduct also allow that parties may consent to be jointly represented or may waive any conflict that could arise between them. Rule 3.4-2 reads:
A lawyer shall not represent a client in a matter when there is a conflict of interest unless there is an express or implied consent from all clients and it is reasonable for the lawyer to conclude that he or she is able to represent each client without having a material adverse effect upon the representation of or loyalty to the other client.
[19] As noted above, Norton did initially obtain Browne’s clear consent and waiver of the conflict of interest and the litigation proceeded on that basis. However, this agreement was modified by Browne in Strothman’s email dated October 31, 2014 and confirmed by Norton’s later statement that it “could not, and would not, act in a manner adverse to Dr. Browne’s immediate interests.” The primary issue is whether, realistically, such adversity can be avoided given the factual matrix of this case. Norton’s position is that such adversity can be avoided given the following: Emery has not defended Browns cross-claim for contribution and indemnity; Emery has not cross-claimed against Browne; and Emery’s overall position that the action should be dismissed against Browne.
[20] Historically, the law on disqualifying conflicts of interest has focused on the use and misuse of confidential information a lawyer may have obtained from his former client. In Martin v. Macdonald Estate (Gray), 1990 32 (SCC), [1990] 3 S.C.R. 1235, at para. 48, Sopinka J. articulated the test for determining whether there is a disqualifying conflict of interest in acting against a former client: (1) Did the lawyer receive confidential information attributable to a solicitor and client relationship relevant to the matter at hand? (2) Is there a risk that it will be used to the prejudice of the client?
[21] In the present case, there remain some issues between Browne and Norton concerning whether any confidential information was received by Norton from Browne and if so whether it has been disclosed. Norton says it is not in possession of any confidential information from Browne. Browne suggests that there is confusion as to what records were withheld from him.
[22] In any event, it is well established that an important element of a lawyer’s obligation to avoid conflicts of interest is the duty of loyalty, which goes beyond the duty not to disclose confidential information. In R. v. Neil, 2002 SCC 70, [2002] 3 S.C.R. 631, the Court wrote in the context of current clients at para. 17:
While the Court is most often preoccupied with uses and abuses of confidential information in cases where it is sought to disqualify a lawyer from further acting in a matter, as in Macdonald Estates, supra, the duty of loyalty to current clients includes a much broader principle of avoidance of conflicts of interest, in which confidential information may or may not play a role.
[23] In R. v. Neil, the Court explained the basis for the duty of loyalty by quoting Wilson J.A.’s judgment in Davey v. Wooley, Hames, Dale & Dingwall (1982), 1982 1787 (ON CA), 35 O.R. (2d) 599 (C.A.), at p. 602:
Human nature being what it is, the solicitor cannot give his exclusive, undivided attention to the interests of his client if he is torn between his client’s interests and his own or his client’s interests and those of another client to whom he owes the self-same duty of loyalty, dedication, and good faith.
[24] R. v. Neil was concerned with the duty of loyalty owed by a lawyer to his or her “current clients,” which would prohibit that lawyer from representing two current clients in matters where they may be adverse in immediate legal interest. However, the courts also have recognized a duty of loyalty owed to “former clients.” According to Justice D.M. Brown (as he then was) in Hames v. Greenberg, 2013 ONSC 4410, at para. 10, “provincial appellate court jurisprudence has concluded that a lawyer may be disqualified from acting against a former client even when the new retainer does not put at risk the former client’s confidences.” This “second dimension of the duty of loyalty to clients” involves the public’s confidence in the administration of justice.
[25] The Ontario Court of Appeal in Consulate Ventures Inc. v. Amico Contracting & Engineering (1992) Inc., 2010 ONCA 788, at paras. 30-31, stated it this way, quoting with approval Cromwell J.A.’s words in Brookville Carriers Flat Bed GP Inc. v. Blackjack Transport Ltd. (2008), 2008 NSCA 22, 263 N.S.R. (2d) 272 (C.A.):
Cromwell J.A. reviewed the case law, including Speid and the authoritative texts at length. He concluded that lawyers had a duty of loyalty to former clients that was rooted both in confidentiality concerns and the need to foster and maintain public confidence in the client/solicitor relationship and the due administration of justice. He said at para. 51:
This broader continuing duty of loyalty to former clients is based on the need to protect and promote public confidence in the legal profession and the administration of justice. What is of concern is the specter of a lawyer attacking or undermining in a subsequent retainer the legal work which the lawyer did for the former client or of a lawyer effectively changing sides by taking an adversarial position against a former client with respect to a matter that was central to the previous retainer.
[26] In the result, the Court of Appeal in Consulate Ventures concluded at para. 36:
I agree with the priority given to the preservation of the integrity of the process. In my view, that goal finds expression in the Rules of Professional Conduct cited above and in the controlling jurisprudence. A lawyer’s obligation, whether described as a duty of loyalty owed to a former client, or as a professional obligation to promote public confidence in the legal profession and the administration of justice dictates that Mr. Lenczner cannot act on this appeal against the respondent, his former client.
[27] If, in defending Emery at trial, Norton acts in a manner that is “adverse” to Browne’s interests, then Norton would be prevented both by its agreement with Browne as well as by its duty of loyalty to Browne and Emery from continuing to act for Emery. Even if no confidential information is at stake, public confidence in the legal profession and the administration of justice requires that the duty of loyalty to Norton’s former and current clients not be compromised. The issue is whether this can be accomplished at trial given that Norton is not defending the cross-claim and will not directly be attacking Browne’s actions.
[28] Notwithstanding Norton’s unequivocal good faith intentions to comply with the agreement not to act in a manner adverse to Browne, in my view it would be difficult, if not impossible, to actually conduct this trial in a fair manner without a substantial risk of a compromised trial process and possible mistrial resulting from disagreements over whether Norton, in defending Emery’s interests, has acted in a manner adverse to Browne’s interests. This is a real risk which exists notwithstanding Norton’s best intentions and good faith efforts to avoid it. Not defending the cross-claim is not, with respect, sufficient to accomplish this goal given that Browne remains a defendant in this action.
[29] In this medical malpractice lawsuit there are liability issues, including both the standard of care and causation, being advanced by the plaintiffs against Emery and Browne. Browne in his cross-claim repeats and relies upon the allegations of negligence by the plaintiffs against Emery. At trial, in addition to the parties, various liability experts will be called. Norton will invariably conduct an examination or cross-examination of some or all of these witnesses. The practical reality is that Court could not fairly police the proceedings and determine at what point such examinations crosses the line from a compliant examination to one that is adverse to Browne. This is especially so given that Browne is self-represented. Can Norton realistically be expected to avoid such adversity if it cross-examines Browne or the other witness called on the issue of liability? Does not the very exercise of providing a full and complete defence to Emery potentially increase Brown’s liability exposure?
[30] There is no order that could be crafted which would fairly and justly alleviate these concerns and which would not unduly restrict both Emery and Browne in their defence of this action. There is no procedural order which would prevent or safeguard against such adversity which would be fair to all parties given the complex nature of the liability issues in this case.
[31] While it is absolutely clear that Norton has acted in good faith and with the best intentions, the reality is that, in light of the agreement and duty of loyalty to both Emery and Browne, Norton must be removed as solicitors of record for Emery in order to ensure a fair trial to all parties and public confidence in the administration of justice.
[32] I am cognizant a litigant should not be deprived of counsel of its choice without good cause. In Best v. Cox, 2013 ONCA 695, at para. 8, Feldman J.A. reiterated the principle that the court will grant a removal motion only in rare cases, citing Cronk J.A. in Kaiser, Re, 2011 ONCA 713, at para. 21 as follows:
As the motion judge properly noted, “A litigant should not be deprived of counsel of his choice without good cause.” … For this reason, Canadian courts exercise the highest level of restraint before interfering with a party’s choice of counsel. Where such discretionary, equitable relief is involved, there must be a possibility of real mischief should a removal order be refused. The test is whether a fair-minded and reasonably informed member of the public would conclude that council’s removal is necessary for the proper administration of justice…
[33] For the reasons given, there is in my view a possibility of real mischief which requires removal in order to ensure the proper administration of justice.
[34] This motion was not brought in a timely way. I am, however, not satisfied that this motion was brought for tactical reasons despite the fact that plaintiff’s counsel raised a potential conflict issue long ago but did nothing about it until now. Based on the unique factual matrix of this case the delay and prejudice to Emery do not outweigh the benefits and necessity of granting the removal order. There is no prejudice that cannot be compensated for by costs and/or an adjournment.
DISPOSITION
[35] I order that Norton be removed as lawyers of record for Emery. Emery is to appoint new counsel within the next 60 days following which a new trial date is to be fixed. A trial management conference is to be arranged with me to take place on an expedited basis immediately following the appointment of new counsel.
[36] If the parties are unable to agree on the costs of this motion, I may be contacted in order to set a timetable for the delivery of cost submissions.
Firestone J.
Released: March 18, 2015
CITATION: Bulloch-MacIntosh et al. v. Browne et al. 2015 ONSC 1622
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
WENDY MARGARET BULLOCH-MACINTOSH and WENDY MARGARET BULLOCH-MACINTOSH, ESTATE TRUSTEE FOR THE ESTATE OF JAMES MACINTOSH,
Plaintiffs (Moving Parties)
– and –
GRAEME BROWNE and RICHARD EMERY
Defendants (Respondents)
REASONS FOR DECISION
Firestone J.
Released: March 18, 2015