Harper v. Cox, 2016 ONSC 3567
CITATION: Harper v. Cox, 2016 ONSC 3567
COURT FILE NO.: 2398/14
DATE: 20160602
CORRECTED: 20160616
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Jane Harper, Client
– and –
John C. Cox, Solicitor
COUNSEL:
Robert Schipper Solicitor for the Client
Gary Joseph and Alex Ward Solicitor for the Solicitor
HEARD: May 17, 2016
REASONS FOR JUDGMENT
CORRECTED DECISION
Corrected Decision: The text of the original judgment dated June 2, 2016 was amended on June 16, 2016 and the description of the amendment is as follows:
Paragraph 37, ‘I observe that in the relevant period, Mr. Cox was not represented by his current counsel, Mr. Joseph.’
Woollcombe J.
A. INTRODUCTION
[1] On April 28, 2008, Jane Harper retained John C. Cox as her family law lawyer in respect of all matrimonial and financial issues between her and her former husband, Paul Brian Harper. Mr. Cox acted for Ms. Harper in this capacity for almost six years. During which time he sent her 37 accounts, which she paid. On March 20, 2014, Mr. Cox was removed as counsel of record. Mr. Cox then sent a final account to Ms. Harper.
[2] Mr. Cox’s accounts over this period were for a total sum of $445,734.98. The matrimonial dispute had not yet gone to trial.
[3] Ms. Harper proceeded, within 30 days of receiving Mr. Cox’s final account, to obtain an Order for Assessment under s. 3(b) of the Solicitor’s Act, R.S.O. 1990 c. S.15 for 38 accounts (the 37 initial accounts and the final account) provided to her by Mr. Cox. That assessment has not yet take place.
[4] The Harper family matrimonial issues proceeded to trial beginning in April 2015 before Justice Gibson (Harper v. Harper, 31030/08). Counsel’s written submissions following the trial were provided to the trial judge on August 31, 2015. His decision remains under reserve.
[5] The assessment of Mr. Cox’s accounts is scheduled to take place on June 27-30, and September 19, 21 and 23, 2016.
[6] While each of the parties has brought motions, the argument before me proceeded on the basis of Mr. Cox’s motion. He seeks:
a) A stay or adjournment of the assessment pending a decision on both the substantive issues and the costs in the matrimonial case before Justice Gibson;
b) An order restricting the scope of the assessment of Mr. Cox’s account to the final account of March 20, 2014, which is for $63,129.00; and
c) Production of material from Ms. Harper said to be relevant to the assessment.
[7] Ms. Harper’s motion is for the Order for Assessment to be varied, if necessary, to include all 38 of Mr. Cox’s accounts in the assessment. Her motion relates to the identical issue raised in Mr. Cox’s second argument about the proper scope of the assessment. Accordingly, in these reasons I will address the three issues advanced in Mr. Cox’s motion.
[8] In response to the first issue raised by Mr. Cox, Ms. Harper’s position is that Mr. Cox has successfully delayed and frustrated the assessment process for more than two years and that he is seeking to do so again. She submits that there is no reason to delay the assessment until after Justice Gibson has released his judgment on the substantive matrimonial issues and his ruling on the costs.
[9] In relation to the appropriate scope of the assessment Ms. Harper says that there is no basis to set aside the Order for Assessment, and that I ought to order that the assessment include all 38 accounts.
[10] Ms. Harper resists the production of documents sought from her by Mr. Cox on the basis that they are not relevant to the assessment.
B. ISSUES TO BE DETERMINED
i) Should the assessment be delayed pending the trial judge’s decision on both the substantive matrimonial issues and costs in those proceedings?
The Positions of the Parties
[11] Mr. Cox’s position is that the assessment should be stayed or adjourned until after the trial judge releases both his substantive decision in the matrimonial case and his decision as to costs in that case.
[12] First, Mr. Cox says that without knowing the results in the trial, he will be unable to make submissions before the assessment officer about the contribution of his efforts to the result. By way of example, Mr. Cox asserts that disclosure was an important issue in the matrimonial case and that while he was counsel, he assisted Ms. Harper in obtaining important disclosure. The value of that work will be impossible to accurately assess until the trial judge decides the relevance of that disclosure in the outcome of the case.
[13] Second, Mr. Cox submits that the assessment needs to proceed after Justice Gibson addresses the issue of costs as otherwise, there is a potential for Ms. Harper to have an unjustified windfall. As I understand his position, this could occur if Ms. Harper is successful in the matrimonial case, is awarded costs based on Mr. Cox’s accounts, and then has those accounts that she has paid reduced by the assessment officer, resulting in her costs award exceeding what she actually paid.
[14] Ms. Harper’s position is that there is no need to delay the assessment. She argues that she is entitled to the assessment and that the assessment officer will be able to assess the results achieved by Mr. Cox based on the results he achieved while he was counsel.
The Legal Principles
[15] Under s. 106 of the Courts of Justice Act, R.S.O., c. C43, s. 106, the court has jurisdiction to stay “any proceedings on such terms as are considered just”. Section 107 of the same Act sets out that when two or more proceedings are pending in two or more different courts, and the proceedings (a) have questions of fact or law in common, (b) claim relief arising out of the same transaction or occurrence or series of actions or transactions or (c) for any other reason ought to be the subject of an order under this section, an order may be made staying one proceeding until the determination of any other of them. Rule 6.01(1)(e) of the Rules of Civil Procedure similarly authorizes a court to stay one of the proceedings until after the determination of another.
[16] While the court has the power to stay proceedings, it is a discretionary power, dependent on the particular facts, to be exercised sparingly and only when special circumstances exist to justify it. In Gowling Lafleur Henderson LLP v. Meredith, 2011 ONSC 2586, Master Dash summarized the principles applicable to whether a stay should be granted at paras. 17-18:
17 Therefore the general principles to be applied on a motion for a stay appear to be:
(1) A court may grant a stay when just and convenient to do so in order to control its process or prevent an abuse of that process.
(2) The discretion to grant a stay is highly dependent on the facts of each particular case.
(2) The discretion must be exercised sparingly and only in special circumstances.
(3) The balance of convenience must weigh heavily in favour of a stay.
(4) The court will be reluctant to grant a stay if it will deny a party's access to the courts or substantially delay or impair his rights to have his case heard.
18 In appropriate cases the court may also consider one or more of the following:
(5) The court will be more inclined to grant a stay if continuation of the action may work an injustice because it is oppressive, vexatious or an abuse of process.
(6) The court will be more inclined to grant a stay if it would not cause an injustice to the responding party.
(7) If there are two or more proceedings with common facts or issues, one action may be stayed if it would avoid a multiplicity of proceedings.
(8) A stay may be ordered where privileged documents obtained in one proceeding may be used in another proceeding if it would result in unfairness or prejudice to the party asserting the privilege.
[17] The authority to adjourn a trial is found in Rule 52.02 of the Rules of Civil Procedure. I note that Rule 1.01(1) states that: “These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.”
[18] While the assessment officer would certainly have the authority to stay or adjourn the proceedings, both counsel accept that I also have the jurisdiction to make either of the orders sought by Mr. Cox. (Loreto v. Little, [2010] ONSC 4764 (S.C.J.). The real issue before me is not whether I am able to stay or adjourn the assessment, but whether I should exercise my discretion to do so in this case.
Analysis
[19] The starting point for my consideration of this issue is Justice Sharpe’s comments in Price v. Sonsini, [2002] O.J. No. 2607 (C.A.) at para. 19 where he discussed the approach to be taken when clients seek to assess their lawyers’ accounts:
Public confidence in the administration of justice requires the court to intervene where necessary to protect the client’s right to a fair procedure for the assessment of the solicitor’s bill. As a general matter, if a client objects to a solicitor’s account, the solicitor should facilitate the assessment process, rather than frustrating the process.
[20] As the Court of Appeal subsequently held in Kulidjan & Associates v. Gareene Homes Inc., 2011 ONCA 224 at paras. 1-2, the words in Price “sound the purpose behind the assessment provisions in the Solicitor’s Act”.
[21] Bearing that purpose in mind, I accept the importance of Ms. Harper being able to move ahead with the assessment of Mr. Cox’s accounts, a process that she is entitled to pursue, and which the court should facilitate.
[22] However, I am concerned about the assessment of Mr. Cox’s accounts proceeding before the trial judge renders his judgment in the matrimonial matter.
[23] The factors that are to be considered by the assessment officer were set by the Court of Appeal in Cohen v. Kealey & Blaney, [1985] O.J. No. 160 (C.A.) as follows:
The taxing officer properly listed the considerations normally applicable to the taxation of a solicitor's account, namely, the time expended by the solicitor, the legal complexity of the matters to be dealt with, the degree of responsibility assumed by the solicitor, the monetary value of the matters in issue, the importance of the matter to the client, the degree of skill and competence demonstrated by the solicitor, the results achieved, the ability of the client to pay and the client's expectation as to the amount of the fee [emphasis added].
[24] In my view, there is no way for an assessment officer to determine, prior to the release of Justice Gibson’s judgment with respect to the matrimonial issues, what “results” were actually achieved by Mr. Cox’s work. While one could say that the results Mr. Cox obtained are evidenced by the results of the motions that he argued, I think that a fairer determination of his skill and competence and the results he achieved in this case requires knowing the results of Ms. Harper’s trial, despite the fact that Mr. Cox’s retainer was over by the time of trial. There may be a great deal of work that was done by Mr. Cox that, while it did not bear fruit at the pre-trial stage, yielded evidence that will be relied upon by the trial judge. By contrast, there may have been hours spent by Mr. Cox on issues that the trial judge will ultimately conclude were unimportant or irrelevant. Only the written reasons of the trial judge will assist in this assessment. Accordingly, I conclude that the assessment should not proceed until after the trial judge releases his decision in the matrimonial trial.
[25] I take a different view on the importance of the trial releasing his decision with respect to costs in the matrimonial matter. In my view, it is not necessary for the issue of costs to be resolved before the assessment can take place. As the Court of Appeal explained in Bosanac v. Bosanac, [2002] O.J. No. 4 (C.A.), different interests are engaged when costs are fixed at the conclusion of proceedings and on an assessment of accounts. In that case, the Court held that a client’s entitlement to an assessment was unchanged by the fact that the assessment officer could award costs that were less than an award of costs made at trial, but noted that in such circumstances, the client would be obligated to refund some of the amount that had been paid as a result of the assessment.
[26] The Court of Appeal has held that there is nothing improper about a client having accounts assessed after costs have been awarded, given the different objectives and considerations arising in the two contexts (Ghaeinizadeh v. Bennett Jones, 2014 ONCA 267). I am of the view that there is equally nothing improper about having an assessment conducted before costs at the trial are fixed, given the different interests engaged by two processes.
[27] It is difficult to predict how the timing will unfold as between the assessment and the fixing of costs following a decision on the matrimonial issues. But, Ms. Harper is a party to both proceedings and will be able to ensure that the two adjudicators are aware of the status of the other hearing. I decline to order that the assessment await the trial judge’s decision as to costs.
ii) Should the scope of the assessment be restricted to the March 20, 2014 account?
The Positions of the Parties
[28] Mr. Cox’s position is that all of the accounts issued to Ms. Harper over the course of their six year solicitor-client relationship were final accounts. He relies, in part, on what he characterizes as the bifurcated terms of the retainer agreement. He also says that the accounts were issued when there were “natural breaks” in the litigation, and that Ms. Harper would have realized from reviewing the accounts that they were final as for the most part, they were timed around the completion of particular steps in the litigation. It is Mr. Cox’s position that Ms. Harper was very happy with his services, as evidence by the fact that she paid all of his accounts. Further, he says that in those instances when Ms. Harper was dissatisfied with what she had been charged, she freely raised her concerns with him and, on a number of occasions, her accounts were reduced.
[29] In response, Ms. Harper’s first position is that Rule 2.02(b) of the Rules of Civil Procedure limits the right of a party to attack a proceeding or step for irregularity if the party has taken a further step in the proceeding after obtaining knowledge of the irregularity. Ms. Harper also argues that Mr. Cox, after learning that the Registrar had ordered an assessment of all 38 accounts, did not move “forthwith” as required by Rule 37.14(1)(c) to set aside the order, and so should be foreclosed from bringing this application.
[30] On the merits of the question as to whether the accounts were interim or final, Ms. Harper says that she was never advised by Mr. Cox that his accounts were final. She says that she relied on the fact that the covering letters she received with the accounts, and the accounts themselves, all describing the accounts “interim”. Had she been told that they were final, she says that she would asked for an explanation as to the significance of this and what it meant for her ability to challenge the account at a later point.
The Relevant Legislation and Legal Principles
[31] The Solicitor’s Act, provides for the assessment of lawyer’s accounts by an assessment officer. Its relevant provisions include:
s. 3 Where the retainer of the solicitor is not disputed and there are no special circumstances, an order may be obtained on requisition from a local registrar of the Superior Court of Justice,
(b) by the client, for the assessment of a bill already delivered, within one month from delivery;
s. 4 (1) No such reference shall be directed upon an application made by the party chargeable with such bill after a verdict or judgment has been obtained, or after twelve months from the time such bill was delivered, sent or left as aforesaid, except under special circumstances to be proved to the satisfaction of the court or judge to whom the application for the reference is made.
s. 11 The payment of a bill does not preclude the court from referring it for assessment if the special circumstances of the case, in the opinion of the court, appear to require the assessment.
[32] In Price, the Court of Appeal settled the issue as to when the one month limitation period begins if the situation is one in which a lawyer provides a client with interim accounts. The Court explained, at para. 16 that:
A rule that required clients to move for immediate assessment of interim accounts would force clients into the invidious position of straining, if not rupturing, the solicitor-client relationship before the retainer has ended. Clients should not be forced to choose between harming the solicitor-client relationship and foregoing the right to have an interim account assessed. Rather, under s. 3, clients should be entitled to move for an assessment of an interim account within one month of delivery of the final account.
[33] Thus, as Justice Perell observed in Fiset v. Falconer, [2005] O.J. No. 4023 (S.C.J.) at para. 25, “much turns on whether an account is final or interim”. If it is properly characterized as interim, then a client has until one month after the final account to obtain an assessment order of all accounts. If, however, it is final, and the client does not move for an assessment within a month of delivery of that account, there is no automatic assessment order made under s. 3(b). In these circumstances, if the account has been paid, a client would have to establish “special circumstances” under s. 11 in order to obtain an assessment.
[34] The question as to whether an account is to be treated as a final account or as an interim account for the purposes of the limitation period for seeking an assessment is a question of fact: Re Fellowes, McNeil v. Kansa Management Services Inc. (1997), 34 O.R. (3d) 301 (C.A.).
[35] The distinction between an interim account and a final account is important. Periodic accounts may be final. But, they are only final if it was the “clear intention of both parties that the bill be final, the bill itself was one to which the solicitor has committed himself or herself and was one that can be assessed”: Enterprise Rent-a-Car Co. v. Shapiro, [1998] O.J. No. 727 (C.A.) at para. 13.
Analysis
[36] For the reasons that follow, it is my view that Mr. Cox’s first 37 accounts were all interim accounts. Accordingly, the assessment should go ahead as ordered by the Registrar and will include all 38 accounts.
[37] I am sympathetic to Ms. Harper’s arguments both that Mr Cox took fresh steps after learning of the Registrar’s Order and that he failed to move to set aside the Registrar’s Order “forthwith”, and so should not be able to advance the arguments he seeks to make on this motion. I observe that in the relevant period, Mr. Cox was not represented by his current counsel, Mr. Joseph.
[38] The Order for Assessment was made on April 29, 2014. In her affidavit, Ms. Harper says that the issue of whether the first 37 accounts were interim or final was not raised at the preliminary appointment with the Assessment Officer on June 12, 2014. Indeed, she says that it was not raised at all until a letter was sent to her counsel by Mr Cox’s former counsel on September 18, 2015. In that letter, counsel indicated that he intended to bring a motion to restrict the assessment to the final account.
[39] Mr. Cox has filed a responding affidavit in which he says that he discussed the issue of restricting the accounts with his former solicitor on June 12, 2014. Mr. Cox also says that he has been advised that counsel raised this issue at the Mediation. Mediation, of course, did not take place until April 8, 2015.
[40] I am not going to preclude Mr. Cox from raising this issue on either basis argued by Ms. Harper. As a result, I need not decide whether and when Mr. Cox raised the issue of the scope of the assessment. Suffice it to say that despite the affidavit evidence from Mr. Cox, I do not think this issue was raised in any meaningful manner in a timely way.
[41] I say this for two reasons. First, when the assessment was scheduled on June 12, 2014, it was set for ten days in October 2015. Surely if Mr. Cox’s counsel had thought the assessment should be restricted to the last account, and planned to bring the sort of motion now before me, he would not have thought ten days necessary for the assessment. Second, it seems that if Mr. Cox truly wished to raise this issue, there would be something in the record in the months between June 2014 and September 2015 that would reflect this. There is nothing. I say this particularly because there was mediation scheduled for October 29, 2014 and, when that was adjourned at Mr. Cox’s request, for January 14, 2015. One would think that Mr. Cox’s counsel would have raised this issue at the times the mediation was adjourned.
[42] It does not appear to me that Mr. Cox or his counsel pursued this matter on a timely basis. But, the Court of Appeal in 1196158 Ontario v. 6274013 Canada Ltd., 2012 ONCA 544 at para. 19 said the following about the application of time lines in the Rules of Civil Procedure:
We should strive to avoid a purely formalistic and mechanical application of time lines that would penalize parties for technical non-compliance and frustrate the fundamental goal of resolving disputes on their merits. As Laskin J.A. stated in Finlay v. VanPaasen 2010 ONCA 204 at para, 14, “the Rules and procedural orders are construed in a way that advances the interests of justice, and ordinarily permits the parties to get to the real merits of their dispute.”
[43] Given this very clear direction to avoid formalism in the application of the Rules, I am not prepared to foreclose Mr. Cox from raising the important issue as to whether his accounts were interim or final before me, despite what I see as a lack of diligence.
[44] I will now address why I say that Mr. Cox’s accounts were all interim.
[45] I begin by considering the retainer agreement itself. Mr. Cox says that the agreement has several features suggestive of the fact that there would be final accounts throughout the retainer. To start with he characterizes this as a “bifurcated retainer” agreement and says that it clearly sets out that if the matter goes to trial, a new retainer will be required. The agreement also makes clear that accounts are to be paid in thirty days. As well, Ms. Harper agreed to the term that she advise Mr. Cox, in writing, of any concerns or discrepancies in the account within thirty days, failing which she may be presumed to accept the account and waive any right she may have to dispute it.
[46] While I have carefully reviewed the retainer agreement and the aspects of it upon which Mr. Cox places reliance, I cannot infer from it that the accounts he sent to Ms. Harper were final. I see nothing in the retainer agreement that makes clear that accounts rendered during the retainer were to be considered final, as opposed to interim. While there is an agreement that there will be a new retainer if the matter goes to trial, nothing is said about the fact that all accounts up to that point are final. While I accept that Ms. Harper agreed to raise her concerns with Mr. Cox, this cannot be understood as effectively contracting out of the provisions in the Solicitor’s Act.
[47] Furthermore, I am concerned that the following provision in the retainer agreement, a premium billing arrangement, strongly suggests that interim accounts are not final, and may be adjusted when a final account is fixed:
I understand that in addition to the fees charged in interim accounts, there will be a final account in which the complexity of the issues and the result obtained will also be taken into consideration in fixing the amount of the final fee which may include a premium for the result retained.
[48] I also note that there is nothing in the retainer agreement that sets out Ms. Harper’s rights of assessment. Nor is there any evidence of there being any discussion about this issue between her and Mr. Cox.
[49] Mr. Cox submits that Ms. Harper was not shy about raising issues with his accounts and that on four occasions, when she raised concerns, her accounts were adjusted. In total, Ms. Harper’s accounts were reduced by $26,928.28. Mr. Cox says that Ms. Harper was content for him to continue doing high quality work and that she effectively “lay in the weeds” and ambushed him by seeking the assessment.
[50] In my view, little can be made of the fact that Ms. Harper paid her accounts with Mr. Cox and chose to raise concerns on only four occasions. I do not see these factors as assisting in the determination as to whether the parties intended the accounts to be interim or final or whether they are properly understood as final. I am mindful of the Court of Appeal’s comments in Price about the risk of jeopardizing the solicitor-client relationship if a client is compelled to move to assess accounts during the currency of the retainer.
[51] I turn next the letters sent to Ms. Harper with the accounts and to the accounts themselves. In each of the cover letters that were sent by Mr. Cox, he began by saying, ”Enclosed please find my interim account for services rendered…” and then filled in the relevant time period. The accounts that he attached all had a heading “Interim”. Below Mr. Cox’s signature at the end of each letter is the following passage:
This interim account does not necessarily represent the value of services rendered to date but only a payment towards the final account.
[52] Mr. Cox points out that in each of these cover letters, he told Ms. Harper that if she had any questions or concerns regarding he accounts, she should not hesitate to contact him.
[53] In my view, the communications sent by Mr. Cox to Ms. Harper through these letters and accounts would have led her to believe, reasonably, that the accounts were all interim and not final. There is nothing to suggest that they were final. This finding is consistent with Ms. Harper’s affidavit evidence that:
At no time did Mr. Cox ever advise me that any of his accounts were final. Had he done so, I would have asked him to explain what he meant by that term and the impact of same on my right to challenge the account should I wish to do so at that time or at a later date.
[54] Mr. Cox also submits that there were “natural breaks” in the litigation, and that he sent accounts after each of these natural breaks, indicating that he treated the accounts as final. He says that Ms. Harper, who knew that she was being asked to pay for the completion of a stage of the litigation, would have realized that the accounts were final.
[55] I accept Mr. Cox’s position that in many, but not all instances, his accounts appear to have been sent at a point when a particular phase of the litigation was completed. However, this fact, standing alone, does not make the accounts final accounts, even if, as he says, he believed them to be so. Moreover, I am not persuaded that there was the sort of breaks in the on-going matrimonial litigation that necessarily rendered the accounts final, in the absence of any articulation by Mr. Cox that this was his intention.
[56] I would take a different view if Mr. Cox had, at the time he provided his accounts to Ms. Harper at what he says were natural breaks in the litigation, told her that he was providing her with a final account in relation to a specific aspect of the litigation, and that, should she wish to have that final account assessed, she must do so in the thirty day period.
[57] But this is not what happened. Instead:
a) The retainer agreement did not set out clearly that all accounts would be final or clarify which accounts would be final or how Ms. Harper would know;
b) Ms. Harper was provided with accounts that purported to be interim accounts, with cover letters that described them as interim accounts;
c) There was nothing about the accounts themselves that indicated that they were final;
d) Ms. Harper was expressly told that the interim accounts were subject to a final account;
e) All of the accounts were rendered during one piece of litigation, a continuous matrimonial matter;
f) Ms. Harper knew from the retainer agreement that that ultimately there would be a final bill, in which she might be premium billed, at the end of the litigation;
g) Ms. Harper was never told what her rights of assessment were.
[58] In all of these circumstances, I conclude that Mr. Cox’s 37 accounts were interim (Teplitsky v. Daniels, (O.SC.J.) at para. 4; Brusby v. Flak, 2011 ONSC 4917 at para 13; Andrew Feldstein & Associates Professional Corp. v. Keramidopoulos, [2007] O.J. No. 3683 (S.C.J.), Enterprise Rent-a-Car, at para. 14).
[59] In the alternative, even if Mr. Cox’s accounts are properly understood as final accounts, I would conclude that there exist special circumstances that justify the court ordering an assessment of all of Mr. Cox’s accounts pursuant the Solicitor’s Act. I find that the special circumstances that either undermine the presumption that the account was accepted as proper or show that the account was excessive and unwarranted here include:
a) The size of the account, which in this case amounts to $454,734.98 for a matrimonial case before it went to trial;
b) The fact that the retainer related to one matrimonial dispute that was not completed by Mr. Cox;
c) The fact that Ms. Harper was never told the meaning of an account being final, as opposed to interim, and was repeatedly provided with accounts that purported to be interim;
d) The fact that Ms. Harper made it known as soon as she received the final bill that she wished it assessed;
e) There was judicial concern raised during the proceedings about the size of Mr. Cox’s bills (See for example, Justice Miller’s Costs Endorsement of March 9, 2010 and Justice Murray’s Costs Endorsement of November 13, 2013);
[60] I conclude that all of Mr. Cox’s 38 accounts should be referred for assessment.
iii) Should the material sought by Mr. Cox be produced for the assessment?
[61] There are two areas of production or disclosure sought by Mr. Cox. I will address them separately.
The Material sought in relation to Roger Campbell
[62] First, Mr. Cox seeks production of any and all notes, memorandum, dockets, emails, and accounts rendered by Roger Campbell to Ms. Harper.
[63] Mr. Campbell was a corporate solicitor independently retained by Ms. Harper, on the recommendation of Mr. Cox. Mr. Campbell conducted three days of questioning of Mr. Harper during the matrimonial proceedings. He communicated regularly with Ms. Harper, sometimes directly and sometimes including Mr. Cox in the communications. He also attended as co-counsel with Mr. Cox at the settlement conference in January 2011 and attended mediation as co-counsel for two days in April 2012.
[64] Ms. Harper takes the position that her communications with Mr. Campbell are privileged and that she is not prepared to waive her privilege. In her affidavit she says that she has paid Mr. Campbell legal fees, disbursements and taxes in excess of $200,000.00. His accounts are not under assessment.
[65] Mr. Cox submits that Ms. Harper has implicitly waived her privilege by virtue of the fact that Mr. Cox and Mr. Campbell regularly discussed the issues in the matrimonial litigation with each other. He says that it is inconceivable that Ms. Harper would not have recognized that the two of them discussed her case. He says that the material sought is relevant because Mr. Cox is entitled to know what Ms. Harper was billed by Mr. Campbell and what she paid to him. As I understand his position it is that Ms. Harper has implicitly confirmed the reasonableness of Mr. Campbell’s accounts, and that this may rebut her argument that Mr. Cox’s accounts were unreasonable.
[66] Ms. Harper responds that Mr. Campbell had a separate limited retainer agreement with her and that there was never a joint retainer with Mr. Cox. Mr. Campbell billed her separately and he communicated with her separately. While she agrees that the two lawyers were retained on the same file and that she expected them to communicate, she says that Mr. Cox never asked her to waive the privilege that attached to her communications with Mr. Campbell, and that she has not done so.
[67] I am not satisfied that there is anything relevant to the assessment in the documents that are sought from Ms. Harper in relation to Mr. Campbell. I reject the suggestion by Mr. Cox that he could rely on Mr. Campbell’s unchallenged accounts as a basis to say that his accounts were reasonable. They were retained separately, for separate purposes, and performed separate services, although they would have worked collaboratively for Ms. Harper. Further, I find that the documents are protected by solicitor-client privilege, which has not been waived by Ms. Harper. I decline to order the production sought.
The Material sought in relation to Ms. Harper’s tax returns
[68] Mr. Cox also seeks production of Ms. Harper’s tax returns and notices of assessment for the years 2008 to 2013 inclusive, as well as the accompanying tax letters written on behalf of Ms. Harper by Mr. Cox.
[69] As I understand Mr. Cox’s position, it is that the assessment officer should be able to consider Ms. Harper’s reliance on the payments of the accounts as her implicit acceptance of these accounts. Mr. Cox would like to know how much Ms. Harper claimed for her legal fees when she filed her tax returns and whether these amounts were accepted by the Canada Revenue Agency (“CRA”). This is said by Mr. Cox to be one of the relevant factors set out in Cohen.
[70] I do not accept Mr. Cox’s position that Ms. Harper’s tax documents are relevant to the assessment. The assessor will have evidence as to the extent of the accounts that Ms. Harper has paid. In my view, neither the payment of accounts by Ms. Harper, nor the reporting of accounts paid by her to the CRA, implies that she accepted the accounts as reasonable. The view of the CRA as to the legitimacy of Mr. Cox’s accounts for Ms. Harper’s income tax purposes is, in my view, irrelevant to the assessment. I find that Mr. Cox has no legitimate basis to obtain Ms. Harper’s tax information for the assessment and I decline to make the production order sought.
C. CONCLUSION
[71] As I have indicated, I have concluded that the assessment of Mr. Cox’s accounts cannot properly be conducted without the parties having Justice Gibson’s judgment on the matrimonial issues. However, it is premature to stay the assessment and to cancel the late June assessment dates. Accordingly, I direct that if Justice Gibson’s judgment remains outstanding at 5:00 on June 13, 2016, two weeks before the assessment is scheduled, a stay of the assessment shall be granted, pending the release of the trial judgment. At that time, the June dates for the assessment should be vacated. The parties should schedule replacement dates for the assessment in the fall of 2016.
[72] The parties should keep the September dates booked pending the release of the decision. Those dates should not be vacated before September 6, 2016. If, at 5:00 pm on September 6, 2016, the judgment remains outstanding, the September assessment dates should be vacated.
[73] The assessment shall proceed on the basis of all 38 of Mr. Cox’s accounts in accordance with the existing Assessment Order.
[74] Mr. Cox’s motion for production is dismissed.
[75] If the parties are unable to agree as to the costs of this motion, they may make written submissions of not more than three pages, in addition to any bills of costs and caselaw. While each party has had some success on this motion, I view Ms. Harper as the more successful party. Accordingly, counsel for Ms. Harper shall have two weeks from the release of this decision to make submissions as to costs. Counsel for Mr. Cox shall have ten days from receipt of Ms. Harper’s submissions to respond. There will be no reply without my permission.
Woollcombe J.
Date: June 2, 2016
Corrected: June 16, 2016
CITATION: Harper v. Cox, 2016 ONSC 3567
COURT FILE NO.: 2398/14
DATE: 20160602
CORRECTED: 20160616
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Jane Harper, Client
– and –
John C. Cox, Solicitor
REASONS FOR JUDGMENT
Woollcombe J.
Released: June 2, 2016
Corrected: June 16, 2016