Court File and Parties

COURT FILE NO.: CV-14-00499833-0000 DATE: 20160506 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: QA CONSULTANTS, Applicant AND: HICKS MORLEY HAMILTON STEWART STORIE LLP, Respondent

BEFORE: R. F. Goldstein J.

HEARD: April 20, 2016

APPEARANCE: Alex Rodov, on his own behalf, for QA Consultants Joshua Concessao, for Hicks Morley

Endorsement

[1] In November 2012 QAC retained Hicks Morley to conduct an action against a company called Cloudpipe Inc. and its principals. During the course of the litigation, Hicks Morley conducted a motion and negotiated settlement on behalf of QAC.

[2] The settlement negotiations with Cloudpipe hinged, to a large degree, on the question of Hicks Morley’s legal fees. Mr. Rodov, the managing partner of QAC, who was instructing Hicks Morley, wanted Cloudpipe to compensate QAC for all its fees. The Cloudpipe principals agreed to pay $120,000.00 in fees.

[3] Allyson Fischer was the Hicks Morley partner conducting the litigation. Ms. Fischer estimated during late-night negotiations in April 2013 that Hicks Morley’s fees at that point were about $65,000.00 to $75,000.00. In fact the fees were about $87,000.00 to that point. Eventually the settlement agreement foundered.

[4] In May 2015 Mr. Rodov and Ms. Fischer exchanged a series of emails about the fees. They agreed to cap Hicks Morley’s fees at $75,000.00 plus HST and disbursements as of May 15 2013. That represented a reduction in Hicks Morley’s fees. QAC would continue to pay fees at the normal Hicks Morley rate going forward from that point.

[5] In October 2013 QAC terminated the retainer with Hicks Morley and retained Bennett Jones. Up to that point Hicks Morley had billed QAC $171,624.20. QAC sought to assess the fees. The parties have met with an assessment officer.

[6] The question now is which portion of the fees should be assessed. Sections 16-24 of the Solicitors Act deal with written fee agreements. Briefly, s. 16 permits written fee agreements. Section 18 permits an assessment officer to review an agreement but if the assessment officer finds that the agreement is not fair and reasonable, it may refer the dispute to the court pursuant to s. 23.

[7] Hicks Morley’s position is that only the fees after May 15 2013 should be assessed. The first $75,000 was a fair a reasonable fee agreement. Thus, only $81,029.07 should be assessed. I permitted Mr. Rodov leave to represented QAC although he is not a lawyer. QAC’s position is that all of the legal fees should be assessed. He says that it would be unfair to QAC to exempt the first $75,000.00 from assessment because he agreed to that amount, in essence, without really seeing the underlying dockets.

[8] I must respectfully disagree with Mr. Rodov. During the late night negotiations with Cloudpipe Ms. Fischer estimated that the fees were $65,000.00 to $75,000.00 but warned that it was only an estimate. In fact the fees were $87,000.00. His series of emails with Ms. Fischer obviously constituted a concession on Hicks Morley’s part recognizing that everyone thought that $75,000.00 was fair and reasonable up to that point. In my view, it is very obvious that Mr. Rodov and Hicks Morley reached a settlement agreement based on those emails.

[9] While I certainly do not question Mr. Rodov’s good faith or credibility, it seems to me that he is a sophisticated businessman who was very diligent about monitoring the fees. I have examined the emails between him and Ms. Fischer. The emails between him and Ms. Fischer demonstrate that he understood the nature of the agreement with Hicks Morley and understood the work that was done. I find that they had an agreement with regard to fees up to May 2013 for $75,000.00. I see nothing unfair or unreasonable about the agreement. Accordingly, Hicks Morley will be assessed on $81,029.07.

R. F. Goldstein J. Date: May 6, 2016