Court File and Parties
COURT FILE NO.: CV-17-580296
RELEASED: 2018/06/15
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Michael Frank Kitchen, Plaintiff
AND:
Johnson McMaster Professional Corporation and Robert James McMaster, Defendants
BEFORE: Master Graham
COUNSEL: Joseph Figliomeni, counsel for the plaintiff
Gavin Tighe, counsel for the defendants (moving parties)
HEARD: May 10, 2018
REASONS FOR DECISION
(Defendants’ motion to remove plaintiff’s counsel)
[1] The plaintiff claims damages from his former lawyer and law firm, alleging negligence in their legal representation regarding a real estate purchase. The defendants now bring this motion to remove the plaintiff’s current counsel and law firm as his lawyers of record and for further production of documents. For the following reasons, I have concluded that Mr. Figliomeni should be removed as the plaintiff’s lawyer of record and I so order. I also order that the plaintiff produce the documents set out in paragraphs 40 and 41 below.
Factual background
[2] A review of the relationship between the plaintiff Kitchen and both his former lawyer McMaster and his current counsel Figliomeni is necessary to provide the context for the motion.
[3] In July, 2015, the plaintiff retained the defendant McMaster to advise him with respect to an agreement of purchase and sale (“the APS”) that he had signed for the purchase of a condominium townhouse from Silver Heights Developments Inc. (“Silver Heights”). Although the APS provided for an initial deposit of $1,000.00 followed by two more deposits, the plaintiff says that Silver Heights orally agreed to accept only two deposits totalling 5% of the purchase price. The APS was not amended to reflect this change.
[4] Construction delays led to delays in the closing date. On July 20, 2016, despite the oral agreement that only two deposits were required, the plaintiff was asked for a third deposit owing under the APS. On August 10, 2016, Silver Heights’ lawyer wrote to McMaster demanding payment of the third deposit from the plaintiff within five days. McMaster was on vacation at that time, did not see the letter, and did not provide a copy to the plaintiff. McMaster subsequently recommended that the plaintiff pay the additional deposit in accordance with the APS. On September 29, 2016, Silver Heights’ lawyer advised that Silver Heights did not wish to proceed with the transaction.
[5] McMaster then recommended that the plaintiff simply seek the return of his deposit, which the plaintiff agreed to. However, the plaintiff subsequently changed his position and provided the third deposit payment to McMaster, to be held in his trust account. McMaster informed the lawyer for Silver Heights that he had the plaintiff’s third deposit, and that the plaintiff wished to proceed with the APS.
[6] On January 9, 2017, Silver Heights offered the plaintiff a return of his deposit if he signed a mutual release; if the plaintiff commenced a legal proceeding, Silver Heights would use his deposit to pay for its legal fees. The plaintiff would not agree to return his deposit, informed Silver Heights that it never sent a demand letter notifying him that the third deposit was due, and indicated that he would pursue legal action if he could not complete the purchase. At this point, he was still not aware of Silver Heights’ August 10, 2016 letter to McMaster.
[7] Subsequent to January 9, 2017, the plaintiff sought the advice of a litigation lawyer. McMaster referred him to various lawyers but the plaintiff ultimately retained his current lawyer, Mr. Figliomeni, who was not one of those suggested by McMaster. On February 7, 2017, the plaintiff commenced an action for specific performance of the APS, being Kitchen v. Silver Heights Developments Inc., court file no. CV-17-569214 (“the Silver Heights action”).
[8] On February 14, 2017, at the return of the plaintiff’s motion for a certificate of pending litigation, counsel for Silver Heights presented a copy of the August 10, 2016 demand letter to the court, following which the plaintiff learned of it. McMaster acknowledged having received this letter and that he had inadvertently neglected to send Kitchen a copy or to discuss it with him. McMaster also apologized to Kitchen and promised that he would do whatever he had to do to “make things right”.
[9] Figliomeni then obtained instructions from the plaintiff to bring a summary judgment motion in the Silver Heights action. In this regard, Figliomeni prepared and McMaster swore an affidavit in which he acknowledged that he received the August 10, 2016 letter from Silver Heights’ lawyer, that he did not recall seeing it before the commencement of the Silver Heights action, and that through inadvertence, he failed to send a copy to the plaintiff.
[10] The Silver Heights action was dismissed by Taylor J. following the hearing of the summary judgment motion. In his Reasons, Taylor J. held that the APS entitled Silver Heights to take the position stated in the August 10, 2016 letter that if the plaintiff failed to provide the third deposit within five days, Silver Heights could terminate the transaction without further notice. Separate from his finding that Silver Heights was not liable to the plaintiff, Taylor J. assessed the plaintiff’s damages at $97,500.00, based primarily on the increased value of the condominium unit, ordered that the plaintiff’s initial deposit of $12,950.00 be forfeited to Silver Heights, and awarded Silver Heights $20,000.00 for the costs of the action.
[11] The plaintiff now brings this action against McMaster and his firm, claiming amounts for the damages as assessed by Taylor J., his forfeited deposit, and the costs ordered payable to Silver Heights. He also claims the fees paid to Figliomeni to prosecute the Silver Heights action.
[12] The defendants submit that Figliomeni, having acted for the plaintiff in the Silver Heights action, will inevitably be required to testify as a witness in this action, which should disqualify him from continuing to act as counsel. The plaintiff does not make any claim against Figliomeni, and wants him to continue representing him. The positions of the parties are set out in greater detail below.
The law
[13] The defendants’ motion to remove Figliomeni as plaintiff’s counsel is based on their submission that the issues in the case will require him to give evidence. The case law on the issue of when a lawyer should be precluded from acting for a party because he will also be a witness in the same proceeding was summarized thoroughly by Master Glustein (as he then was) in Mazinani v. Bindoo, 2013 ONSC 4744 at paragraphs 60 and 61:
60 I adopt the following principles as the applicable law on a motion to remove a lawyer of record who may be a witness at trial:
(i) The court has inherent jurisdiction to remove a lawyer from the record who has a conflict of interest. The inherent jurisdiction "stems from the fact that lawyers are officers of the court and their conduct in legal proceedings which may affect the administration of justice is subject to this supervisory jurisdiction" (MacDonald Estate v. Martin, 1990 32 (SCC), [1990] 3 S.C.R. 1235 ("MacDonald Estate"), at para. 18);
(ii) The inherent jurisdiction extends to removing a lawyer who may be a witness in a case in which the lawyer acts as counsel (Ontario Realty Corp v. P. Gabriele & Sons Limited et al, [2006] O.J. No. 4497, 2006 37844 (Ont. S.C.J.) ("Ontario Realty"), at para. 16);
(iii) The court on a motion to remove a lawyer of record who may be a witness at trial must consider "(a) the maintenance of high standards of the legal profession and the integrity of our system of justice and (b) the right of a litigant to its choice of counsel, which he or she should not be deprived of without good cause" (Ontario Realty, at para. 17, citing MacDonald Estate, at para. 13);
(iv) The test to be applied on a motion to remove a lawyer from the record who may be a witness is whether a fair-minded reasonably informed member of the public would conclude that the proper administration of justice requires the removal of the lawyer. This determination is objective, fact-specific and based on an examination of all factors in the case (Karas v. Ontario, 2011 ONSC 5181 (S.C.J. - Mast.) ("Karas") at para. 26; Ontario Realty, at para. 20);
(v) The court's concern of a lawyer appearing as a witness is that (i) there may be a conflict of interest between the lawyer and client and (ii) the administration of justice can be impaired by a conflict between the lawyer's obligations of objectivity and detachment which are owed to the court and the lawyer's obligation to his or her client to present evidence in as favourable a light as possible. In Urquhart v. Allen Estate, [1999] O.J. No. 4816 (S.C.J.) ("Urquhart"), Gillese J. (as she then was) held (Urquhart, at paras. 27-28):
When counsel appears as a witness on a contentious matter, it causes two problems. First, it may result in a conflict of interest between counsel and his client. That conflict may be waived by the client, as indeed, was done in this case. The second problem relates to the administration of justice. The dual roles serve to create a conflict between counsel's obligations of objectivity and detachment, which are owed to the court, and his obligations to his client to present evidence in as favourable a light as possible. This is a conflict that cannot be waived by the client as the conflict is between counsel and the court/justice system.
Counsel are independent officers of the court. The trial judge must be able to rely upon plaintiffs' counsel for a high degree of objectivity. The overriding value, in these circumstances, is concern for the proper administration of justice. A distinction must be drawn between the role of counsel as an independent officer of the court and the role of a witness whose objectivity and credibility are subject to challenge.
(See also Karas, at para. 27);
(vi) The integrity of a lawyer's role as an advocate is also undermined if the lawyer was a witness to a critical meeting. In Young-Tangjerd v. Official Board of Cavalry United Church, [2006] O.J. No. 2161, 2006 17946 (Ont. S.C.J.) ("Young-Tangjerd"), Hockin J. held (Young-Tangjerd, at paras. 6-7):
The material fact on the motion and the fact which raised the possibility that the solicitor might be called as a witness at trial is this. The solicitor was present at a meeting at which the plaintiff was present with members of the defendant church. He was there as a member of the church not as solicitor. The plaintiff alleges that she was dismissed from her employment constructively during the course of the meeting or because of the meeting. The reasons of the motion judge posit that in this circumstance, the solicitor's disqualification is not automatic and that it could be left to another judge by motion (presumably on the eve of trial) to quash his subpoena or to the trial judge to determine whether he could act as trial counsel if he was to be called as a witness.
In my view, the issue is not the lawyer's position as a witness but his position as advocate. I doubt whether any party or a witness may be cross-examined by a lawyer who could cross-examine not on the basis of his brief but on the basis of his participation in the event or transaction cross-examined on. Any question, leading or not, once posed by the lawyer is unfair to the witness and carries with it the appearance of an unsworn offer of the advocate's version of the facts. In addition, questions put in cross-examination by the lawyer witness would create the uneasy feeling in the mind of the plaintiff in this case that the measure of his credibility could be based not on the basis of the evidence but the unsworn declaration of a judicial participant in the proceeding, the defendant's lawyer. It goes without saying that the lawyer cannot compartmentalize his or her mind to exclude actual knowledge of the event. As well, the court should ensure no conflict in the lawyer's duty as advocate and as an officer of the court. For example, what is the lawyer to do if his memory of the event differs from the evidence in-chief he hears from his witnesses. [Italics in original.]
(vii) Rule 4.02(2) of the Rules of Professional Conduct of the Law Society of Upper Canada provides that "Subject to any contrary provisions of the law or the discretion of the tribunal before which a lawyer is appearing, a lawyer who appears as advocate shall not testify before the tribunal unless permitted to do so by the rules of court or the rules of procedure of the tribunal, or unless the matter is purely formal or uncontroverted";
(viii) The commentary to Rule 4.02(2) sets out the concern that a lawyer who puts personal beliefs into issue acts contrary to the lawyer's role as an objective advocate and puts the lawyer's credibility at issue. The commentary provides:
"A lawyer should not express personal opinions or beliefs or assert as a fact anything that is properly subject to legal proof, cross-examination or challenge. The lawyer should not in effect appear as an unsworn witness or put the lawyer's own credibility in issue. The lawyer who is a necessary witness should testify and entrust the conduct of the case to another lawyer".
(ix) Rules of Professional Conduct are not binding on a court, but are persuasive as an important statement of public policy (MacDonald Estate, at paras. 16 and 18; Karas, at para. 29);
(x) Courts should be reluctant to make what may be premature orders preventing lawyers from continuing to act. If the evidence does not necessarily have to come from the lawyer and may be obtained through admissions or documentary productions, a removal order will be premature (Essa (Township) v. Guergis; Membery v. Hill, 1993 8756 (ON SCDC), [1993] O.J. No. 2581 (Div. Ct.) ("Essa"), at para. 43); Lesniowski v. H.B. Group Insurance Management Ltd., [2002] O.J. No. 3194 (S.C.J. - Mast.) ("Lesniowski"), at para. 15);
(xi) If there is some doubt or "merely a potential" that a lawyer will be called as a witness at trial, the courts should be more generous in allowing the lawyer to remain on the record and deferring the matter until after discoveries or leaving the matter to the trial judge (George S. Szeto Investments Ltd. et al v. Ott, [2006] O.J. No. 1174, 2006 9307 (Ont. S.C.J. - Mast.) ("George S. Szeto"), at para. 13);
(xii) "In view of the expense of litigation and the enormous waste of time and money and the substantial delay which can result from an order removing solicitors, courts should only do so in clear cases" (Essa, at para. 43);
(xiii) "[A] court should be slow to interfere with the litigant's right to choose his or her counsel. ... When a litigant is deprived of the services of a lawyer whom she has chosen, there will be some hardship imposed on her. The imposition of such hardship can only be justified if it is done to prevent the imposition of a more serious injustice. It follows that the removal of counsel should be only to relieve the risk of real mischief and not a mere perception of mischief" (Urquhart, at para. 19);
(xiv) Certainty that a lawyer will be called as a witness is not required. Rather, the court must consider the likelihood of the lawyer being called as a witness (Ontario Realty, at para. 33);
(xv) "It is not sufficient for a moving party to suggest opposing counsel is a potential witness or allege only that he or she might provide material evidence. Rather, it must be established that there is a real basis to believe counsel can likely, or probably, provide material evidence" (Graham v. Ontario, [2006] O.J. No. 763 (S.C.J.) ("Graham"), at para. 35; Ontario Realty, at paras. 34-35);
(xvi) "While courts have acknowledged that the freedom to choose counsel is an important interest to protect, it is not an absolute right. The right to be represented by counsel of choice can be outweighed when the administration of justice would be detrimentally affected" (Karas, at para. 45; George S. Szeto, at para. 21; Urquhart, at paras. 21 and 28); and
(xvii) The court should approach a motion to remove a lawyer of record who may be a witness at trial by following a flexible approach and consider each case on its own merits (Essa, at para. 48). . . .
61 Given the above law, the Divisional Court in Essa set out "a variety of factors" to be considered on a motion to remove a lawyer of record who may be a witness at trial. Those factors are (Essa, at para. 48) (quoted verbatim):
(i) the stage of the proceedings,
(ii) the likelihood that the witness will be called,
(iii) the good faith (or otherwise) of the party making the application,
(iv) the significance of the evidence to be led,
(v) the impact of removing counsel on the party's right to be represented by counsel of choice,
(vi) whether trial is by judge or jury,
(vii) who will call the witness if, for example, there is a probability counsel will be in a position to cross-examine a favourable witness, a trial judge may rule to prevent that unfair advantage arising, and
(viii) the connection or relationship between counsel, the prospective witness and the parties involved in the litigation.
[14] As set out below, one of the issues on this motion is whether Figliomeni will be required to testify at trial with respect to the fees in the Silver Heights action that the plaintiff is trying to recover in this action. In this regard, the plaintiff and Figliomeni rely on Little v. Ottawa (City), 2003 43081 (ON SC), [2003] O.J. No. 5075 in which Smith J. declined to remove the lawyers of record for a plaintiff who was trying to recover legal fees charged by that lawyer. Smith J. held (at paragraph 25):
25 I find that the Defendants would suffer minimal prejudice, if any, by conducting an assessment of [plaintiff’s counsel’s] invoices, if they so desired, rather than having to cross-examine [plaintiff’s counsel] at trial.
[15] On the same issue, the plaintiff and Figliomeni rely on Dupuis-Bissonnette v. Helmutz Interlock, 2011 ONSC 2914 in which Hambly J. cited Little v. Ottawa and held (at paragraph 10):
10 [I]f the trial judge was of the view that whether these fees [claimed as damages from the defendant] were reasonable was a live issue, the trial judge could order that the fees be assessed. An experienced assessment officer whose function is to asses lawyers’ bills of costs would be in a better position to determine if these costs were fair and reasonable than the trial judge. [The lawyer whose fees were claimed as damages] would have to testify before the assessment officer, but this is not a reason for removing him as the lawyer for [the plaintiffs] at the trial.
Issue on the removal motion
[16] Based on the applicable law, the issue on the removal motion is whether Figliomeni’s involvement as plaintiff’s counsel in the Silver Heights action creates a sufficient likelihood that he will be a witness in this action to warrant removing him as counsel, notwithstanding the plaintiff’s desire to have him continue to act.
Submissions of the defendants
[17] The thrust of the plaintiff’s action is that he sustained damages as a result of McMaster’s failure to send a copy of Silver Heights’ August 10, 2016 demand letter to him or to discuss the contents of that letter with him. The statement of claim sets out the history of the plaintiff’s efforts to purchase a condominium townhouse from Silver Heights (see paragraphs 2-6 above), McMaster’s failure to inform him of the August 10, 2016 demand letter, McMaster’s swearing of his affidavit acknowledging the error, and Taylor J.’s dismissal of the summary judgment motion.
[18] The defendants submit that the issues raised in the pleadings and the evidence on this motion support the removal of Figliomeni as plaintiff’s counsel on the basis that he will inevitably be a witness at the trial of the action.
[19] The defendants rely on the following passages in the statement of claim:
The plaintiff alleges that “according to the advice and counsel he received from McMaster” he was legally entitled to proceed with the closing of the subject transaction (paragraph 24).
The plaintiff pleads that Taylor J., in his Reasons with respect to the summary judgment motion, found that Silver Heights was entitled to take the position in its August 10, 2016 letter that the plaintiff provide the third deposit within five days failing which Silver Heights could terminate the APS, and that the plaintiff was in breach of the APS by failing to do so (paragraph 29).
The plaintiff pleads as particulars of McMaster’s breach of contract and negligence that he failed to protect his interests by advising of his rights and obligations under the APS, and that he failed to notify him of the August 10, 2016 demand letter (paragraph 34).
The plaintiff claims as damages costs of the Silver Heights action (statement of claim paragraphs 1(f) and 38), which includes both the $20,000.00 in costs awarded against him in Taylor J.’s decision on the summary judgment motion and the legal fees paid to Figliomeni with respect to that action (Kitchen cross-examination, Q 14).
[20] The statement of defence includes the following pleadings:
The plaintiff, on the advice of his current counsel, proceeded with the Silver Heights action for specific performance of the APS, which had no reasonable chance of success (paragraph 18).
The plaintiff now seeks to make the defendants a guarantor for “ill-advised, unreasonable and unsuccessful litigation”, with respect to which he relied on the advice of his current counsel. The defendants rely on the “doctrine of identification” and plead that the plaintiff is identified at law with the negligence of his agents (i.e. Figliomeni) acting on his behalf (paragraph 20).
[21] The defendants’ evidence is contained in the affidavit of the defendant McMaster sworn March 28, 2018 and includes the following:
McMaster first met with the plaintiff Michael Kitchen to review the APS on July 10, 2015, at which time Kitchen had already executed the APS (paragraph 3).
The APS included an Entire Agreement clause to the effect that the vendor (Silver Heights) and purchaser (Kitchen) agreed that there were no conditions affecting the agreement “other than as expressed herein in writing” (paragraph 5).
The APS included a term that in the event that Kitchen is in default under the agreement, and fails to remedy it, if such default is a monetary default then Silver Heights may unilaterally declare the APS to be terminated (paragraph 6).
At the July 10, 2015 meeting, Kitchen at no point advised that he had made an oral agreement with Silver Heights that he would not be required to pay the third deposit under the terms of the APS (paragraph 8).
On July 20, 2016, Kitchen’s real estate agent informed him in writing that a third deposit was required (paragraph 9).
McMaster acknowledges that his office received the August 10, 2016 letter from Silver Heights demanding payment of the third deposit and that he failed to send a copy of it to Kitchen (paragraph 10).
On August 31, 2016, McMaster informed Kitchen by email of his concern that “the vendor is correct that the contract does provide for a further deposit, and there isn’t any way I can undo that” (paragraph 12 and exhibit D).
On September 29, 2016, McMaster sent an email to Kitchen in which he reported that, based on a conversation with Silver Heights’ lawyer, Silver Heights did not want to proceed with the sale. McMaster informed Kitchen that “my best advice to you is to aim to get the deposit back and move on”, and recommended against “a costly law suit that will drain you financially and emotionally” (paragraph 13 and exhibit E).
McMaster provided Figliomeni with a copy of his files for the purpose of the Silver Heights litigation. He was not informed of Figliomeni’s strategy for this action, nor was he informed of the defences raised to it. He acknowledges swearing the affidavit referred to in paragraph [9] above (paragraph 22).
The plaintiff’s affidavit of documents contains no notes, correspondence, accounts or other documents from Figliomeni’s file for the Silver Heights action.
[22] The defendants also rely on evidence given by Kitchen on the cross-examination on his affidavit sworn April 14, 2018 in response to this motion, as follows:
Kitchen initially denied that his decision to make a claim against Silver Heights was based on advice and recommendations from Figliomeni (Q 21).
Kitchen did not retain either of the litigation lawyers to whom he was referred by McMaster but rather, retained Figliomeni (Qs 41-42).
Only Figliomeni acted for the plaintiff in the Silver Heights action (Q 48) and he drafted the statement of claim in that action (Q 44).
The bringing of the summary judgment motion in the Silver Heights action was based on advice received from Figliomeni, who recommended that he bring the motion, prepared the motion material, and argued the summary judgment motion (Qs 56-58 and 66-67). However, McMaster “supported and knew what we were doing in those efforts” (Qs 63-64).
[23] The defendants submit that the main liability issue in the action against them is whether there was any negligence or other breach of duty on the part of McMaster that resulted in the failure of the plaintiff’s action for specific performance against Silver Heights. Their defence is essentially that, regardless of the failure on McMaster’s part to provide Kitchen with Silver Heights’ August 10, 2016 demand letter, the APS required Kitchen to pay the third deposit, which he failed to do. More significantly for the purpose of this motion, part of their defence is that the plaintiff relied on Figliomeni’s advice in electing to proceed with the Silver Heights action and accordingly, any losses arising from the failure of that action are his fault and not theirs. Figliomeni will therefore be required to testify with respect to his advice given to the plaintiff to proceed with the Silver Heights action.
[24] With respect to damages, the defendants submit that, because the plaintiff’s damages include the amounts paid to Figliomeni to prosecute the Silver Heights action, Figliomeni will be required to testify to substantiate the quantum of those claims.
[25] The defendants submit that based on Urquhart v. Allen Estate, supra, (cited at paragraph 60(v) of Mazinani, supra), the fact that Figliomeni will inevitably be required to testify at the trial of this action with respect to these two issues should disqualify him from continuing as counsel.
Submissions of the plaintiff
[26] The plaintiff relies on various passages from Mazinani, supra, including the factors to be considered from Essa v. Guergis, supra (paragraph 61 of Mazinani quoted at paragraph [13] above). The parties do not disagree on the applicable law.
[27] The plaintiff opposes the motion on the following grounds:
He does not intend to rely on Figliomeni to give evidence (paragraph 67 of the Kitchen affidavit).
He trusts Figliomeni’s ability to represent him and wants him to continue to act (paragraph 69).
He cannot afford the additional cost of retaining a new lawyer who is unfamiliar with his case (paragraph 69).
[28] Kitchen also deposes that “there is no reason why Figliomeni’s evidence is necessary to determine the issues of liability and damages in this action” (paragraph 67). I note that this is simply a bald statement of opinion and does not constitute evidence of the truth of the statement.
[29] The plaintiff submits that this is not a clear case in which the integrity of the justice system would be compromised if Figliomeni continues to act for him, particularly considering the additional expense to him were his lawyer removed. He reiterates that he does not intend to call Figliomeni as a witness and points out that there is no evidence from McMaster that he intends to call him. He relies on the passage at paragraph 60(xi) of Mazinani that “If there is some doubt or “merely a potential” that a lawyer will be called as a witness at trail, the courts should be more generous in allowing the lawyer to remain on the record and deferring the matter until after discoveries or leaving the matter to the trial judge”.
[30] The plaintiff also relies on the findings of Taylor J. on the summary judgment motion in the Silver Heights action, and submits that McMaster’s pleading that Figliomeni caused his damages is not substantiated by any evidence or by the court’s findings in that action. However, the findings of the court in the Silver Heights action are not determinative of the issue of whether Figliomeni’s advice to Kitchen in that action may have contributed to his losses. The soundness of Figliomeni’s advice in that action was not an issue before the court. Further, McMaster could not be bound in this action by any apparent finding in an action to which he was not a party. The fact that Taylor J. commended counsel for having the Silver Heights action resolved by a summary judgment motion simply means that he agreed that a trial was not warranted; the comment was not directed to whether or not the action should have been brought in the first place.
[31] Kitchen also relies on Salyani v. Bank of Nova Scotia, 2017 ONSC 955 (Master). The plaintiff in that case sued the defendant bank, her employer, alleging that it prepared a false report regarding a slip and fall accident in which she was involved on the bank’s premises. The defendant brought a motion to remove the plaintiff’s lawyer on the basis that the lawyer would be required to give evidence about communications he had with the defendant concerning the incident report and the settlement of an earlier slip and fall action in which the report formed part of the liability evidence. Master Muir dismissed the motion on the basis that it was not clear to him that the plaintiff’s lawyer’s evidence would likely be necessary at trial. He also acknowledged that if he granted the removal order, the plaintiff would be forced to retain a new lawyer who was unfamiliar with the case, and the plaintiff’s limited means may interfere with her doing so. Master Muir also commented, consistent with the case law reviewed above, that an order removing opposing counsel “should not be made lightly and only in clear cases” (paragraph 20).
Analysis and decision
[32] The Divisional Court in Essa (Township) v. Guergis, supra (see paragraph 61 of Mazinani, supra) set out a list of factors to be considered on a motion to remove a lawyer of record who may be a witness at trial. My review of those factors is as follows:
(i) The stage of the proceedings:
The action is currently at the pre-discovery stage, with the parties having exchanged pleadings. Kitchen has delivered an affidavit of documents and the issue of whether Kitchen must produce further documents is before the court as part of this motion. The affidavit evidence of both Kitchen and McMaster and the cross-examination of Kitchen fully canvass the extent of Figliomeni’s involvement in the Silver Heights action. The issue of Figliomeni having to be a witness in this action was raised by McMaster’s counsel in a timely manner (see below) so there can be no suggestion of delay by the defendants in raising the issue. The fact that this motion is brought at this early stage means that any financial burden on Kitchen arising from a removal order has been minimized to the extent possible. This factor is more favourable to the moving party.
(ii) The likelihood that the witness will be called:
Kitchen has deposed that he does not intend to “rely on Figliomeni to give evidence”. Although Figliomeni submits that there is no evidence that McMaster would call him to testify, the defendants state in their factum that given Kitchen’s position that he will not be calling Figliomeni, “it will be McMaster who will need to call Mr. Figliomeni as a witness to obtain his evidence”. The fact that McMaster has not stated in evidence that he would call Figliomeni is not a bar to the court accepting his counsel’s statement that he will call him. Kitchen and Figliomeni also submit that McMaster’s contention that Figliomeni will be a witness at trial is mere speculation that does not warrant his removal. Given the pleadings and evidence reviewed above with respect to Figliomeni’s involvement in the decision to commence the Silver Heights action, particularly in the context of McMaster’s advice to Kitchen to “avoid a costly lawsuit”, there is a significant likelihood that he has relevant evidence to give on matters in issue and that he will be called as a witness. This factor therefore strongly favours the removal of Figliomeni as counsel.
(iii) The good faith (or otherwise) of the party making the application:
Kitchen submits that the motion to remove his counsel is tactical and that “McMaster’s lawyers have a history of bringing these types of disqualification motions” against Figliomeni’s former law firm and a former colleague. The plaintiff relies on the unrelated matter of Karn v. 1528008 Ontario Inc., 2014 ONSC 3299, in which defendants’ counsel in this case unsuccessfully moved to remove Figliomeni’s former colleague Mr. Sternberg from the record. However, that case is distinguishable from this one on the basis that the presiding judge, Ramsay J., concluded that there was “no prospect that Mr. Sternberg will have material evidence to give, let alone evidence that is material and necessary”.
The issue of Figliomeni having to be a witness in this action was first raised on September 20, 2017 by Mr. Bennett, McMaster’s previous lawyer, when he served the statement of defence. Accordingly, the issue was raised at the first reasonable opportunity, and before current defence counsel was ever involved in the matter. In addition, unlike Ramsay J. in Karn, I have concluded that Figliomeni does have evidence to give that is both relevant and material to the issues of whether the Silver Heights action should have been prosecuted, and of the reasonableness of his legal fees claimed as damages. I therefore accept that the motion in this case was brought in good faith.
(iv) The significance of the evidence to be led:
Kitchen’s action against McMaster is fundamentally based on the allegation that he sustained losses because McMaster failed to provide him with Silver Heights’ August 10, 2016 demand letter. McMaster’s position is that Kitchen was already in default of the payment of the third deposit before McMaster was retained and the demand letter sent. Further, Kitchen was ill-advised to proceed with the Silver Heights action in the face of the terms of the APS, particularly where he had the opportunity to be refunded his first two deposits, and McMaster had advised against litigation. As concluded with respect to factor (ii) above, Figliomeni has evidence to give on the issue of Kitchen’s decision to proceed with the Silver Heights action, which is directly relevant to the liability issue, and therefore significant. This factor strongly favours Figliomeni’s removal as counsel.
Figliomeni can also give relevant evidence on the issue of the damages attributable to his legal fees. However, I accept that the issue of the quantum of Figliomeni’s account may be addressed by way of an assessment, as in Little v. Ottawa and Dupuis-Bissonnette v. Helmutz Interlock, supra, so the fact that these damages are in issue would not in itself be grounds to remove Figliomeni as plaintiff’s counsel.
(v) The impact of removing counsel on the party's right to be represented by counsel of choice:
Kitchen submits that, if Figliomeni were removed as his lawyer, he would not be able to afford the additional cost of retaining a new lawyer. McMaster submits that if the plaintiff wants to rely on financial hardship to oppose the motion, he must provide detailed evidence of his financial circumstances, similar to the obligation on a party who alleges impecuniosity in response to a security for costs motion. Even absent detailed financial evidence, I accept that having to retain another lawyer, who will have to spend time learning what Figliomeni already knows, will result in additional expense to the plaintiff. I also accept that any such additional expense is not easily absorbed by people of average means, so an order removing Figliomeni will likely have a financial impact on the plaintiff. I therefore accept that there will be some negative financial impact on Kitchen if Figliomeni is removed as his lawyer.
(vi) Whether trial is by judge or jury:
The action will be tried by judge alone. This factor is neutral with respect to the outcome of this removal motion.
(vii) Who will call the witness if, for example, there is a probability counsel will be in a position to cross-examine a favourable witness, a trial judge may rule to prevent that unfair advantage arising:
The plaintiff has already stated on this motion that he will not be calling Figliomeni to give evidence. Accordingly, if his evidence is required, then the defendants will have to call him which will give the plaintiff the advantage of being able to cross-examine his own lawyer. The fact that the wording in the decision is that “a trial judge may rule” does not prevent the court on this motion from considering the unfair advantage that would arise if Figliomeni is permitted to continue as counsel until trial, and then the plaintiff, presumably through other counsel, is permitted to cross-examine him. This is precisely the unfair advantage that this factor seeks to address and favours removal in these circumstances.
(viii) The connection or relationship between counsel, the prospective witness and the parties involved in the litigation:
As reviewed above, the defendant McMaster is the former solicitor for the plaintiff Kitchen with respect to the APS that he entered into with Silver Heights. The prospective witness Figliomeni acted for Kitchen in the Silver Heights action and continues to act for him in this action against McMaster and his firm. In this action, Kitchen alleges that McMaster is responsible for his losses arising from the aborted purchase from Silver Heights, including his lost deposit, costs payable to Silver Heights, and fees paid to his lawyer. McMaster alleges that Figliomeni’s actions in advising Kitchen to pursue the Silver Heights action caused or contributed to Kitchen’s loss of his deposit and loss of the costs ordered payable to Silver Heights, and resulted in him incurring the fees paid to Figliomeni for his work on the Silver Heights action. The fact that Kitchen’s relationship with Figliomeni raises an issue that could affect the outcome of his action arising from his relationship with McMaster favours the removal of Figliomeni as his counsel.
[33] A review of the factors set out in Essa (Township) v. Guergis reveals that they predominantly favour removal of Figliomeni as Kitchen’s lawyer. The only factor that militates against removal is the likely additional financial burden on Kitchen in the event of Figliomeni’s removal.
[34] It appears clear that Figliomeni’s evidence with respect to Kitchen’s decision to proceed with the Silver Heights action will be necessary to address the issue of whether any losses arising from that action resulted from McMaster’s conduct in failing to forward the August 10, 2016 demand letter or from Figliomeni’s advice to proceed with the Silver Heights action. Although Figliomeni submits that this evidence may be led through the plaintiff Kitchen, the fact that it will be Figliomeni’s conduct and advice that will be challenged makes it inevitable that his own testimony will be required. Even if he were not to testify, he would be in the untenable position of having both to advance the plaintiff’s claim and defend himself against allegations of negligent advice.
[35] As noted above, in the Salyani decision relied on by the plaintiff, the court found that it was unclear whether the lawyer whose removal was sought would be required to give evidence and on that basis dismissed the removal motion. Although it is clearer in this case that Figliomeni’s evidence will be required, the question still arises as to whether the issue should be left to the trial judge. The later in the action a removal order is made, the greater the adverse impact on the party whose lawyer is removed, owing to the greater amount of additional material that a new lawyer will have to review to become familiar with the case. An additional danger in leaving the issue to the trial judge is that a removal order at that stage could very well delay the trial so that the plaintiff can seek new counsel.
[36] The court’s primary mandate on a removal motion is to balance the prohibition against counsel in an action also being a witness against a litigant’s right to choice of counsel. Given the likelihood that Figliomeni’s evidence will be required at trial, it is preferable to remove him as counsel now, than to risk both the increased expense that would arise from removing him at a later date and the postponement of a scheduled trial in the event of his removal by the trial judge. I have acknowledged above that removing Figliomeni as counsel would plausibly result in an increased financial burden on Kitchen. However, given the apparent inevitability of Figliomeni testifying at trial and his attendant removal as counsel, it is preferable to make the decision now and at least mitigate any additional expense to the plaintiff.
[37] I therefore order that Joseph Figliomeni and Lawrence, Lawrence, Stevenson LLP be removed as lawyers of record for the plaintiff Michael Kitchen in this action.
Motion for further production
[38] In addition to the removal of plaintiff’s counsel, the defendants seek an order for production of unredacted copies of Figliomeni’s file with respect to the Silver Heights litigation and unredacted copies of his accounts delivered to Kitchen in that litigation. The contents of Figliomeni’s Silver Heights litigation file was first requested by McMaster’s former counsel in October, 2017.
[39] The defendants submit that Figliomeni’s litigation file in the Silver Heights matter, to which Kitchen is entitled to access, is relevant to the issue (reviewed at length above) of whether some of Kitchen’s losses resulted from McMaster’s failure to provide him with Silver Heights’ August 10, 2016 demand letter, or from Figliomeni’s advice to proceed with the Silver Heights action. As Figliomeni’s litigation file will plausibly contain documents relating to the advice that he gave to Kitchen in this regard, it is relevant. The fact that the documents would be subject to solicitor-client privilege was addressed by Master Dash in Kota v. Raphael, [2003] O.J. No. 3003, at paragraph 16:
16 . . . There is a deemed waiver of solicitor-client privilege when the plaintiffs put into issue the nature of the legal advice they received. In my view there was a deemed waiver over [the current solicitor’s] file as the plaintiffs alleged reliance on [the former solicitor’s] advice to their detriment, and the defendants [i.e. the former solicitors] denied reliance alleging that the plaintiffs relied on other legal advice (i.e. that of [the current solicitor]). It would be unfair to deny to the defendants access to documents that might shed light on the plainitffs’ instructions and state of mind and about delineation of responsibility between the law firms. See Woodglen & Co. v. Owens (1995), 1995 7070 (ON SC), 24 O.R.(3d) 261 (Ont. Gen. Div.).
[40] I accept that, similar to the circumstances in Kota, as Kitchen has put into issue the conduct of his former counsel McMaster, and McMaster alleges that at least a portion of Kitchen’s losses resulted from his reliance on the advice of his current counsel Figliomeni, Kitchen is deemed to have waived solicitor-client privilege on Figliomeni’s advice in respect of the Silver Heights action. Kitchen shall therefore produce any documents from Figliomeni’s file relevant to the advice given to him by Figliomeni with respect to the initiation and conduct of the Silver Heights action.
[41] Further, Figliomeni’s accounts to Kitchen with respect to the prosecution of the Silver Heights action are relevant to Kitchen’s claim for damages, which includes the amount of those accounts, regardless of whether those damages are assessed by the trial judge or by an assessment officer at the trial judge’s direction. Accordingly, Kitchen shall produce those accounts, subject only to redaction of any entries relating to advice given regarding this action brought by Kitchen against McMaster and his law firm.
[42] The documents ordered produced shall be produced to the defendants within 45 days of the release of these reasons.
[43] Finally, the defendants, in their notice of motion, also seek an order granting leave to examine Figliomeni as a non-party witness. Neither the defendants nor the plaintiff addressed this issue in their factums and there was no case law provided with respect to discovery of a non-party under rule 31.10. My notes indicate that the issue was raised only briefly by McMaster’s counsel in oral argument. As the issue was not fully argued, the motion for this relief is dismissed without prejudice to a renewed motion on complete material.
Costs
[44] Counsel have filed costs outlines. If they cannot agree to the disposition of the costs of the motion, they may make written submissions, the defendants within 30 days and the plaintiff within 20 days thereafter. For the assistance of counsel in resolving the issue, my current inclination is to order that the costs of the motion, in an amount agreed to or fixed by the court, be payable to the defendants in the cause, such that they recover the costs only at the conclusion of the action and only in the event that they are successful in achieving a dismissal of the action as a whole.
MASTER GRAHAM
Date: June 15, 2018