Court File and Parties

COURT FILE NO.: CV-11-422191 DATE: 20170331 ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N:

LANG MICHENER LLP Plaintiff/Counterclaim Defendant

- and -

GREGORY P. KING Defendant/Plaintiff by Counterclaim

COUNSEL: Gavin Tighe, for Plaintiff/Counterclaim Defendant Mr King, for himself, Defendant/Plaintiff by Counterclaim

DECISION

D.L. Corbett J.:

This decision should be read together with my decisions in King v. Giardina, 2017 ONSC 1588 and King v. O’Toole, 2017 ONSC 1915. Terms are defined in the Giardina decision for all three decisions.

PART 1 - INTRODUCTION

(a) King owes a judgment debt of more $2 million

[1] Gregory King is a lawyer. He practiced business law at Aylesworth Thompson LLP (“Aylesworth”), and subsequently at Gowling Lafleur Henderson LLP (“Gowling”).

[2] In the mid-1990’s, King acted in connection with a transaction involving an Italian company [Sincies Chiementin SpA (“Sincies”)], a Swiss company affiliated with Sincies [“HFM”], a Chinese-Canadian businessman [David Chan], and two Bahamian companies affiliated with Sincies and HFM [“Splendide” and “Splendide Nansha”]. The transaction was a new hotel to be built in Nansha, China. King received a 5% interest in the hotel and Aylesworth was to receive payment of fees for legal services in connection with the project.

[3] The transaction did not thrive. And neither did Sincies: it ended in bankruptcy proceedings in Italy.

[4] One Sincies asset was its US $600,000 deposit in the Nansha hotel project. Sincies’ trustee in bankruptcy learned that, apparently, this deposit had disappeared. The trustee inquired further, leading the trustee to make allegations against various persons connected to the venture, including King and Chan. These allegations were not resolved, and the trustee brought legal proceedings in Italy against King and Chan to try to recover the US $600,000 for Sincies’ creditors (the “Italian Proceedings”).

[5] King did not defend the Italian Proceedings. The case went ahead without King’s participation, and in 2001 the Italian court ruled against King for US $600,000. King did not pay the judgment, taking the position that the Italian court lacked jurisdiction over the claims against him.

[6] In 2007, Sincies’ trustee sued King in Ontario to enforce the Italian judgment. King defended and counterclaimed. The enforcement action was decided by Whalen J. after a four-day motion for summary judgment. Whalen J. found that the Italian court had acted with jurisdiction and that the Italian judgment ought to be enforced in Ontario. Venezia/Sincies v. King, 2010 ONSC 6453 (the “Ontario Trial Decision”). King appealed. The Ontario Court of Appeal dismissed King’s appeal. Sincies Chiementin S.p.A. v. King, 2012 ONCA 653 (the “Ontario Appellate Decision”). King sought leave to appeal to the Supreme Court of Canada, which was denied. King v. Sincies Chiementin S.p.A., 2013 SCCL 15622.

[7] By the end of the Ontario Enforcement Proceedings, King owed Sincies’ trustee the principal amount of the Italian judgment (US $600,000), costs in Italy and in the Ontario proceedings, plus interest since 2001. The current amount outstanding on the judgment is apparently more than $2 million.

(b) The Current Proceedings

[8] The proceedings now before the court arise out of the events that led to the Ontario judgment against King. King’s claims against Giardina and others arise from the conduct of the Italian Proceedings. Giardina and Sasson are Italian lawyers and Chiomenti Studio Legale is their law firm (the “Italian Defendants”). King alleges that the Italian Defendants acted in conflict of interest when they acted against him and that they breached duties they owed to him both (i) in acting against him, and (ii) in the way they conducted the Italian litigation against him.

[9] King’s proceedings against Gowling and O’Toole concern the events between King and his own law firm at the time that Sincies’ claims were asserted against King. King claims indemnity from his former law firm and claims against O’Toole in negligence on the basis of advice King alleges to have received from O’Toole about the Italian Proceedings.

[10] King’s proceedings against Lang Michener concern the conduct of the Ontario Enforcement Proceedings. King was represented by Lang Michener in those proceedings. King claims that those proceedings were defended negligently. In addition, King claims that Lang Michener gave him negligent advice as a result of which King failed to commence timely proceedings against his own insurer, Lawyers’ Professional Indemnity Company (“LawPro”). King’s proceedings against Lang Michener are counterclaims in response to Lang Michener’s main claim against King for payment for their services defending the Ontario Enforcement Proceedings.

(c) The Current Motions

[11] The defendants in all three actions move for judgment dismissing King’s claims against them.

[12] The Italian Defendants argue that the courts of Ontario have no jurisdiction over King’s claims against them, and, in the alternative, that Ontario is not a convenient forum for these claims. Factum of the Giardina Defendants, para. 1. I decide this motion in separate reasons (2017 ONSC 1588).

[13] Gowling and O’Toole argue that King’s claims against them are barred by limitations periods. Gowling also argues that there is no basis for King’s claim to indemnity for the Italian judgment: the events that gave rise to the Italian judgment all occurred while King was a member of Aylesworth, and not while King was a member of Gowling. Gowling Factum, paras. 1, 5-6. I decide this motion in separate reasons (2017 ONSC 1915).

[14] Lang Michener argues that:

(a) there is no issue requiring a trial in respect to King’s counterclaims that the Ontario Enforcement Proceedings were conducted negligently by Lang Michener because:

(i) the issues and arguments King alleges were not pursued by Lang Michener were, in fact, fully argued before and decided by Whalen J. in the Ontario Trial Decision, and

(ii) these allegations are collateral attacks on the Ontario Trial and Appellate Decisions, predicated as they must be on an argument that those decisions were decided wrongly and, but for the alleged negligence of Lang Michener, would have been decided in King’s favour. Lang Michener argues that this kind of collateral attack is an abuse of process and cannot raise a triable issue; and

(b) there is no issue requiring a trial in respect to King’s counterclaims that King was given negligent advice about the applicable limitation period for King to sue LawPro for refusing his claim to indemnity respecting the Italian judgment because:

(i) Lang Michener was not retained by King to advise on and did not advise on his claims against LawPro;

(ii) King had no valid claim against LawPro because:

a. the limitation period for King’s claims against LawPro had already long expired; and

b. King was not entitled to indemnity from LawPro for the Italian judgment in any event because that judgment did not arise from provision of legal services, but rather, it arose from fraud. Lang Michener Simplified Procedure Motion Form, pp. 5-6.

Thus, Lang Michener argues, it is clear that any claim King may have had against LawPro was doomed to fail by the time that Lang Michener was involved. Accordingly, Lang Michener argues, King has suffered no damages as a result of any advice Lang Michener may have given on this issue.

I decide the Lang Michener motion in these reasons. As will be seen by anyone who reads all three sets of reasons, the first 14 paragraphs of all three sets of reasons are substantially identical. In my reasons in King v. Giardina, 2017 ONSC 1588, I set out detailed background facts for all three motions, at paragraphs 22-35, which I incorporate here by reference.

(d) Summary and Disposition

[15] I find that there are no triable issues in King’s counterclaim against Lang Michener. The claim that Lang Michener was negligent in the defence of the summary judgment motion in the Ontario Enforcement Proceedings is a collateral attack on the decisions of Whalen J. and the Ontario Court of Appeal and cannot succeed. Further, on the record before me, the allegations of negligence against Lang Michener are devoid of substance. The claim that Lang Michener negligently advised in connection with timely commencement of proceedings against LawPro cannot succeed because, even if that negligence took place, it caused no damage: King’s claims against LawPro had already expired by the time he spoke with Lang Michener about them.

PART II – LEGAL PRINCIPLES

(a) Law of Summary Judgment

[16] Summary judgment is appropriate where there is no genuine issue requiring a trial. Rules of Civil Procedure, R.R.O. 1990, Reg. 194, R. 20.04(2). As stated by the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7,

[t]here will be no genuine issue requiring a trial when the written record (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts and (3) is a proportionate, more expeditious means to achieve a just result. Trotter v. Trotter, 2014 ONCA 841, para. 72.

[17] On a motion for summary judgment, each side must put its best foot forward with respect to the existence or non-existence of material issues to be tried. A party is not entitled to sit back and rely on the possibility that more favourable facts may develop at trial. See Danos v. BMW Group Financial Services Canada et al., 2014 ONSC 2060, aff’d 2014 ONCA 887, para. 21.

[18] The general approach prescribed in Hryniak is described in Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200 as follows:

As I read Hryniak, the court on a motion for summary judgment should undertake the following analysis:

1. The court will assume that the parties have placed before it, in some form, all of the evidence that will be available for trial;

2. On the basis of this record, the court decides whether it can make the necessary findings of fact, apply the law to the facts, and thereby achieve a fair and just adjudication of the case on the merits;

3. If the court cannot grant summary judgment on the motion, the court should:

a. Decide those issues that can be decided in accordance with the principles described in 2) above;

b. Identify the additional steps that will be required to complete the record to enable the court to decide any remaining issues;

c. In the absence of compelling reasons to the contrary, the court should seize itself of the further steps required to bring the matter to a conclusion. Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200, para. 33; aff’d 2014 ONCA 878; leave to appeal to SCC dismissed 2015 SCCL 39803.

(b) Law of Limitations

[19] The applicable limitation period is two years. Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, s.4.

[20] When a defendant pleads the expiry of the limitations period, the plaintiff has the burden of proving that the cause of action arose within the statutory limitations period. Soper v. Southcott, 1998 CarswellOnt 2906, para. 14 (CA). The cause of action arises when it is “discovered” within the meaning of the Limitations Act.

[21] Subsection 5(1) of the Limitations Act provides:

A claim is discovered on the earlier of,

(a) The day on which the person with the claim first knew,

(i) That the injury, loss or damage had occurred,

(ii) That the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) That the act or omission was that of the person against whom the claim is made, and

(iv) That, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek remedy; and

(b) The day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).

[22] Subsection 5(2) of the Limitations Act contains a rebuttable presumption:

A person with a claim shall be presumed to have known of the matters referred to in clause 1(a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.

PART III – ANALYSIS OF THE ISSUES ON THIS MOTION

(a) Lang Michener’s Alleged Negligence on the Summary Judgment Motion

[23] This action began as a collections claim by Lang Michener against King. On March 14, 2011, Lang Michener sued King for $70,258.77, the balance it claimed was owed for its services in the Ontario Enforcement Proceedings. King delivered a statement of defence and counterclaim dated May 5, 2011.

[24] In his statement of defence and counterclaim, King defends against Lang Michener’s claim for professional fees on the bases that:

(a) King was billed a total of $302,660.79 by Lang Michener, an amount King alleges is “excessive by any reasonable standard” and “out of proportion to what would constitute a fair fee.” [para. 5]

(b) The fees charged were inconsistent with fee agreements between King and Lang Michener. [paras. 32-39]

(c) Lang Michener focused on “technical” issues and failed to address the more important issue of Sincies’ trustee “knowingly withholding evidence” from the court, in breach of its obligations as officers of the court. [paras. 37-8, 48-50]

(d) As a result “[t]he motion judge arrived at numerous factual conclusions which were either unsupported by, or completely contrary to, the evidence.” [para. 45]

(e) Lang Michener gave King negligent advice about the limitations for suing LawPro on its denial of coverage. King alleges that, but for this negligent advice, he “would have been reimbursed for his defence costs and would be indemnified with respect to the judgment obtained by the trustee in bankruptcy.” [para. 51]

[25] King’s counterclaim seeks “judgment against [Lang Michener] for negligence and breach of the terms of the retainer agreement in an amount equal to the defendant’s liability to Sincies’ trustee in bankruptcy.” [para. 55] King does not allege any additional facts in the counterclaim and repeats and relies on his allegations in his defence to Lang Michener’s claim. [para. 56]

1. Impermissible Collateral Attack on the Decision of Whalen J.

[26] King had four opportunities to make his case during the Ontario Enforcement Proceedings:

(i) the summary judgment motion before Whalen J.;

(ii) a motion to vary and/or adduce fresh evidence before Whalen J. after the summary judgment motion;

(iii) the appeal at the Court of Appeal; and

(iv) a motion to adduce fresh evidence at the Court of Appeal.

[27] Litigation is not a reiterative process: there is one trial at which each party presents its entire case. Then there is a judgment, which finally decides the case, including all matters which were raised in, or could have been raised in, the case. Then there are appeal rights, which include a possible appeal based on the ineffective assistance of counsel at trial. Once the appeal has been decided, the case is over and the decision stands as the final disposition of the matters raised in the case, binding on the parties to the case. Overlaid on this process are limited rights to seek to reopen the evidence by way of motions to adduce fresh evidence.

[28] Whalen J. decided that the Italian court had jurisdiction and that the Italian Judgment should be enforced in Ontario. That decision is final and it is binding on King. King cannot now sue Lang Michener on the theory that Whalen J. was wrong.

[29] The negligence claim against Lang Michener for the conduct of the summary judgment motion is predicated on a theory that Whalen J.’s decision would have been different but for Lang Michener’s negligence. That basis for the claim, in turn, must flow from an argument that Whalen J. was wrong. And that finding can only be made if the correctness of Whalen J.’s decision is put in issue.

[30] The collateral attack rule rests on the need for court orders to be treated as final, binding and conclusive unless they are set aside or varied on appeal. Court orders may not be attacked collaterally. That is, a court order may not be attacked by a person bound by it in proceedings other than those whose specific object is the reversal, variation or nullification of the order. Indalex Limited (Re), 2011 ONCA 265, paras. 152-153.

[31] Further, the statement of defence and counterclaim in the proceeding at bar was delivered on May 5, 2011. It contained all of King’s allegations of negligence against Lang Michener. The hearing in the Ontario Court of Appeal was more than a year later, on September 24, 2012. Thus all of the allegations made in the statement of defence and counterclaim were known to King before the hearing in the Ontario Court of Appeal. All of them were available to him on appeal, as was an argument that he received the ineffective assistance of counsel at the hearing before Whalen J. The issues raised by King about matters argued before Whalen J. are definitively decided against King by the decision of the Ontario Court of Appeal.

[32] King’s claims of negligence in connection with the argument of the case before Whalen J. are barred by the collateral attack rule and must be dismissed for that reason.

2. Negligence Claim Against Kelly Fails on the Merits in any event

[33] Whalen J. summarized King’s position on the motion for summary judgment at the outset of his decision. That summary, at paragraph 2 of the Ontario Trial Decision, includes the following arguments made on King’s behalf:

• the [Italian] judgment was obtained by fraud as to jurisdiction
• the [Italian] judgment was obtained despite there being fraud on the merits that was undetectable by the [Italian] court
• [King] has issued a counterclaim alleging that [Sincies trustee] breached his duty as trustee in bankruptcy and as an officer of the court in that he knowingly asserted false claims against [King] before the Italian court and submitted evidence before the Italian court and this court that he knew to be false and by withholding evidence he knew or ought to have known would be material to the decision of either court.

[34] Whalen J. gave extensive reasons rejecting these arguments. They are summarized in my reasons in the Giardina decision and I do not repeat them here. The gist of the decision is this: the judgment of the Italian court was properly grounded on the evidence before that court. Giardina and his client had no obligation to put King’s case before the Italian court. Giardina and his client did not misrepresent the evidence that they had, and they were not bound to accept or further investigate the statements made by King in his letter to Giardina three weeks before the return date of the Italian proceedings. Giardina put King on notice that he would not be putting the Italian court on notice of King’s arguments, and advised King to obtain Italian counsel to put his case before the Italian court. King did not do this. The Italian proceedings were not ex parte, but by default, on notice to King, who chose not to appear. The result of the Italian proceedings might have been different if King had appeared and presented his evidence, but he did not do this and now must live with the result of his decision not to defend the proceedings against him. On balance, given everything that was before Whalen J., although His Honour cannot say the result would have been the same if King had presented his case in Italy, neither can he be certain that the result would have been different.

[35] Whalen J. expressly rejected the argument that Giardina and Sincies trustee knowingly asserted false claims against King. Rather, Whalen J. concluded that the trustee and his counsel were not obliged to accept King’s unsworn statements made without supporting documents (King’s letter of January 8, 1999), delivered almost a year after service of the Italian claim on King, and shortly before the return date of the Italian proceeding.

[36] Finally, I note that King’s argument on this point is not that Lang Michener failed to put material evidence before Whalen J. Nor is King’s argument that Lang Michener failed entirely to make the arguments he now says should have been made prominently. These arguments could not succeed given (a) King’s heavy involvement in and approval of the materials submitted on his behalf in writing; (b) Whalen J.’s reference to these arguments expressly in his decision. Rather, King’s argument is that Lang Michener emphasized technical arguments, at the expense of substantive arguments, and thus the proper weight was not given to arguments King thought were his strongest. All of the arguments were before Whalen J., and counsel’s tactical decisions as to which arguments to emphasize or not to emphasize in oral argument cannot be said to be “causes” of the court’s decision. Tactical choices of how to present arguments before Whalen J. would not affect the reception of those arguments by the Court of Appeal. There is simply no basis in fact available to King that any shortcomings in oral argument by Lang Michener could possibly have caused him any compensable damages.

[37] I am satisfied that Whalen J. was fully alive to the arguments that King alleges were not made properly by Lang Michener. The claim fails for this reason as well.

(a) Advice Not To Sue LawPro

[38] In his statement of defence and counterclaim, King makes the following allegations in respect to this issue:

29. On November 23, 2007, LawPro declined coverage in part because the Italian court specifically disavowed any jurisdiction to consider [King]’s professional claims and adjudged [King] liable on a finding of civil fraud.

30. [King] advised [Lang Michener] of LawPro’s decision and met with Mr Kelly in early January 2008 to discuss the conduct of the case. During that meeting [King] and [Kelly] discussed the denial of coverage, and [King’s] intention to contest this decision and recover his defence costs and indemnity from LawPro once the motion had been heard.

31 Mr Kelly failed to advise [King] that in order to successfully challenge the denial of coverage, a claim would have to be filed against LawPro within 2 years. Based on advice provided by Kelly during this discussion, [King] understood that it was not necessary for any steps to be taken to preserve his rights against LawPro until after the determination of the proceeding by the trustee to enforce the Italian judgment in Ontario.

As noted above, King alleges that, but for Lang Michener’s negligent advice on the need to commence proceedings against LawPro, he “would have been reimbursed for his defence costs and would be indemnified with respect to the judgment obtained by the trustee in bankruptcy.” [para. 51]

[39] The sequence of events was as follows:

(i) The Italian trustee served the Ontario proceedings on King on May 30, 2006; King Affidavit, paras. 71 and 77; King transcript, Q. 186.

(ii) King reported the claim to LawPro on August 7, 2007; King Affidavit, para. 79. Kelly Affidavit, para. 79, Exhibit “I”.

(iii) LawPro denied King’s claim on November 23, 2007;

(iv) King had a meeting with Kelly on January 11, 2008 during which King alleges Kelly gave him the impugned advice.

(v) King never commenced an action against LawPro in respect to these matters.

[40] King alleges that Kelly told him that the limitation period against LawPro would not start to run until the Ontario action was decided. King alleges that Kelly told him that there was “plenty of time to deal with this later” and that Kelly did not say that a claim would have to be started within two years of LawPro’s coverage denial. King Affidavit, paras. 97-99.

[41] Kelly has no recollection of precisely what was discussed at the meeting of January 11, 2008. He does recall that the purpose of the meeting to discuss matters related to the defence of the Ontario Enforcement Proceedings. Kelly did depose, however, that he would not have advised King that the limitation period would not have begun to run until the end of those proceedings. He also deposed that in 2008 and for the prior 35 years, as an experienced litigator, his standard practice was to recommend to clients to commence proceedings immediately, particularly if there was any uncertainty about when a limitation period started to run. Kelly was not cross-examined on this evidence. Kelly Affidavit, para. 37.

a. The Claim Was Much Too Late

[42] The applicable insurance policy, known as a “claims made” policy, contained the following coverage provision:

The insurance afforded by the POLICY covers CLAIMS made against the INSURED for the first time during the POLICY PERIOD, no matter when the actual or alleged error, omission or negligent act took place and so long as the INSURED shall: (i) report the CLAIM to the INSURER during the POLICY PERIOD; (ii) not know or ought to have known prior to the POLICY PERIOD of such CLAIM or the circumstances giving rise to such CLAIM…. Capitalized terms are defined in the policy. The “POLICY PERIOD” was January 1, 2007 to December 31, 2007.

[43] There is a good argument that King knew of “circumstances giving rise” to the claim when the Italian trustee first threatened legal proceedings against him. Certainly the service of a claim issued against him in the courts of Italy gave King knowledge of the claim against him. The definition of “claim” in the policy is not restricted to claims made in the courts of Ontario. I find that King knew of the claim when he was served with the Italian claim, by February 1998.

[44] Relief from forfeiture is generally not available for “claims made” policies; rather, the notice requirement is an integral part of the trigger for coverage in such policies. Stuart v. Hutchins; Peel Law Association v. Royal Insurance, 2013 ONSC 2312. However, in some cases an insured may be able to obtain relief from forfeiture for failure to give notice in some circumstances, though it is clear that relief from forfeiture will not be granted where prejudice to the insurer is established. Ideal Roofing Company v. Royal and Sunalliance Insurance Company; Minto Construction Ltd. v. Gerling General Global Insurance Co..

[45] In particular, relief from forfeiture will not be granted where, for example:

(i) the insurer was prevented from protecting its interests in the case;

(ii) the entry of an adverse judgment deprived the insurer of an opportunity to defend;

(iii) the reporting delay precluded the insurer’s investigation of the claim; and

(iv) the reporting delay precluded the possibility of an early settlement. Peel Law Association v. Royal Insurance, 2013 ONSC 45, para. 45. I have limited this list to the examples described in Peel Law Association that apply to the case at bar.

(v) By the time King made his claim to LawPro, all of these elements of prejudice had taken place. The delay had been almost a decade. King could not have succeeded in an application for relief from forfeiture in these circumstances.

King’s claim against LawPro had long expired by January 2008, when he claims to have discussed this issue with Lang Michener. Thus his failure to start a claim against LawPro at that time has not caused him any damages: he would have lost that claim in any event.

a. The Subject Matter of the Claim Was Not Covered

[46] The “coverage grant” under the insurance policy was as follows:

To pay on behalf of the INSURED, all sums which the INSURED shall become legally obligated to pay as DAMAGES arising out of a CLAIM, provided the liability of the INSURED is the result of an error, omission or negligent act in the performance of or the failure to perform PROFESSIONAL SERVICES for others.

[47] “PROFESSIONAL SERVICES” is defined in the insurance policy as “the practice of the law of Canada, its provinces or territories, and specifically those services performed, or which ought to have been performed, by or on behalf of an Insured in such Insured’s capacity as a lawyer and as a member of the Law Society of Upper Canada….”

[48] In its judgment, the Italian court specifically declined to take jurisdiction over King in relation to allegations of professional liability:

… to ascertain the professional liability of Mr King is certainly outside the scope of Italian jurisdiction, as it has been shown that the services performed by the defendant [King] did not take place in Italy. In summary, Italian jurisdiction exists only with regard to the extra-contractual action.

[49] The Italian court’s findings on the issue of “extra-contractual liability” were as follows:

Indeed, in light of the reconstruction of facts set forth above… Mr King and Mr Chan, as they agreed between themselves, as shown by the numerous contacts between them which left indisputable traces in the documents examined, acted in such a way as to defraud [Sincies], first by persuading it to undertake a significant financial commitment for a commercial transaction which, in fact, had never been initiated, and then by definitively preventing it from recovering the amount advanced.

[50] The insurance policy covered claims against King arising from his provision of professional services. It did not cover personal claims against King. Gertner v. Professional Indemnity Company, 2011 ONSC 6121. The judgment against King finds that he acted in concert with Chan to defraud Sincies of the US $600,000. The fraud arose in the context of a transaction in which King acted as solicitor and provided legal services, but it is not in respect to an “error, omission or negligent act” in those legal services.

[51] I appreciate King’s frustration on this point. He disagrees with the Italian judgment. He believes, with some justification, that if the Italian court had had all the evidence before it, it would not have decided as it did. All of those were matters to be raised with the Italian court. All of those matters were raised before Whalen J. in the Ontario enforcement action and failed.

[52] The Italian judgment sounds in fraud, not professional negligence, and coverage was not available for King from LawPro in respect to liability for fraud. Therefore, regardless of the advice that was given by Kelly, King has suffered no damages: he would have lost an action against LawPro, and so his failure to start such a lawsuit after LawPro denied coverage in November 1997 has cost him nothing.

PART IV – ORDER AND COSTS

[53] The motion is granted. Summary judgment is granted dismissing the counterclaim entirely. If the parties cannot agree on costs then Lang Michener shall deliver written costs submissions by April 21, 2017 and King shall deliver responding written costs submissions by May 12, 2017.

[54] This decision disposes of the allegations of professional negligence and breach of retainer that comprise the counterclaim. It does not decide issues relating to the value of Lang Michener’s services or any agreements that may have been made between King and Lang Michener governing Lang Michener’s fees and disbursements for their services.

[55] Scheduling of steps in the main action shall be addressed at the next case management conference.

D.L. Corbett J.

Released: March 31, 2017