COURT FILE NO.: CV-14-503419 DATE: 20180723

ONTARIO SUPERIOR COURT OF JUSTICE

B E T W E E N :

NATHAN JACOBSON Plaintiff – and – STEVEN SKURKA Defendant

Nathan Jacobson representing himself William McDowell and Paul-Erik Veel for the Defendant HEARD: March 28, 2018

FAVREAU J. :

Introduction

[1] The plaintiff, Nathan Jacobson, has brought this action against his former lawyer, Steven Skurka, alleging that Mr. Skurka coerced him into accepting a guilty plea in relation to indictments by the United States Government, and that Mr. Skurka was negligent in other respects in his representation of Mr. Jacobson throughout the U.S. proceedings.

[2] Mr. Skurka seeks summary judgment and the dismissal of Mr. Jacobson's claim, arguing that Mr. Jacobson's action does not raise any triable issues. In particular, Mr. Skurka disputes that he coerced Mr. Jacobson into accepting the guilty plea or that he was otherwise negligent in representing Mr. Jacobson. Mr. Skurka asserts that, at all times, Mr. Jacobson was represented by competent U.S counsel, and that there was no negligence on Mr. Skurka's part in acting as an intermediary between Mr. Jacobson and his U.S. lawyers. Mr. Skurka also argues that Mr. Jacobson's claim is statute barred.

[3] For the reasons that follow, I am satisfied that Mr. Jacobson's action does not raise any triable issues and that it is just and fair to grant summary judgment in Mr. Skurka's favour.

Overview of the facts

[4] Mr. Jacobson is a Canadian businessman. In 2007, he was the principal of RX-Payments Ltd. ("RX-Payments), which at that time was in the business of processing online credit card payments.

[5] Mr. Skurka is a Canadian criminal defence lawyer, based in Toronto. He was called to the Bar in 1983.

Charges against Mr. Jacobson and retainer of Mr. Skurka

[6] On July 27, 2007, Mr. Jacobson was indicted by the United States Government on charges of money laundering, wire mail fraud, mail fraud, racketeering, and distributing and dispensing of controlled substances.

[7] The indictments related to an online pharmacy business referred to as the Affpower Enterprise ("Affpower"). The U.S. Government alleged that Affpower sold drugs online to customers without in-person physician consultations in violation of the laws and regulatory requirements of numerous U.S. States. The charges against Mr. Jacobson arose from RX-Payments' involvement in processing credit card payments for Affpower.

[8] Mr. Jacobson was one of seventeen people charged in the indictment.

[9] On August 3, 2007, Mr. Jacobson contacted Mr. Skurka, seeking his representation. As Mr. Jacobson did not reside in the U.S., but rather split his time between Canada and Israel, he had not yet been arrested by the U.S. Government and was facing potential extradition proceedings.

[10] Mr. Skurka's evidence is that he was retained by Mr. Jacobson to act as his lead counsel, which involved representing and providing advice to Mr. Jacobson on the extradition issues and retaining and overseeing U.S. counsel in relation to the criminal proceedings in the U.S.

[11] Mr. Skurka represented Mr. Jacobson from early January 2007 until 2011.

[12] Besides Mr. Skurka, a number of other lawyers acted for Mr. Jacobson during this time period. In some cases, they were retained by Mr. Skurka on Mr. Jacobson's behalf and in other cases Mr. Jacobson retained them directly:

a. David Elden, a criminal defence lawyer based in California: Mr. Skurka retained Mr. Elden in August 2007, soon after Mr. Jacobson retained him. Mr. Elden provided advice on a range of matters, including Mr. Jacobson's potential liability for the charges he was facing, procedural issues including Mr. Jacobson's entitlement to disclosure, the process for negotiating a plea bargain and the range of sentences Mr. Jacobson might face. Mr. Elden's retainer lasted until late April 2008.

b. Marie Heinen, a criminal defence lawyer based in Toronto: Ms. Heinen was retained later in August 2007, to assist Mr. Skurka with the extradition issues. Ms. Heinen worked with Mr. Skurka in providing advice to Mr. Jacobson leading up to the guilty plea in May 2008, after which her involvement essentially ended.

c. Patricia Holmes, a former Assistant U.S. Attorney and judge: In February 2008, Mr. Skurka initially retained Ms. Holmes to obtain a second opinion on sentencing issues relevant to the guilty plea. In late April 2008, when Mr. Elden’s retainer ended, Ms. Holmes and her firm took over as lead U.S. counsel representing Mr. Jacobson in the U.S. proceedings.

d. Joseph Rubin, U.S. lawyer: Before the indictments, Mr. Jacobson had retained Mr. Rubin to provide advice on the legality of Affpower's business model. In March 2008, Mr. Skurka obtained a follow up legal opinion from Mr. Rubin on the issue.

e. Dan Castleman, a criminal lawyer and Former Chief Assistant District Attorney in New York: Mr. Jacobson retained Mr. Castleman directly in 2009 to provide him with assistance and advice following the guilty plea, including on issues related to modifying or withdrawing the guilty plea.

f. Michael Gordner and Michael Attanasio: Criminal defence lawyers in the U.S. retained by Mr. Jacobson in 2012. They represented Mr. Jacobson in proceedings brought to withdraw Mr. Jacobson’s guilty.

U.S. proceedings and guilty plea

[13] Following a period of negotiation, on May 7, 2008, Mr. Jacobson pled guilty to a single count of money laundering.

[14] Mr. Skurka and the other lawyers representing Mr. Jacobson were involved in the following events leading to the guilty plea:

a. On August 15, 2007, Mr. Skurka and Mr. Elden met with Assistant United States Attorney Corbin Weiss. Mr. Skurka's evidence is that, during the course of the meeting, Mr. Weiss provided information about some of the evidence the U.S. Government had against Mr. Jacobson, and signaled an interest in having Mr. Jacobson plead guilty and cooperate with the U.S. Government.

b. In discussions following the meeting with Mr. Weiss, Mr. Jacobson advised Mr. Skurka that he had no intention of pleading guilty.

c. On August 22, 2007, Mr. Skurka and Mr. Elden met with Mr. Weiss again. Mr. Weiss gave them some information about the evidence the Government had against Mr. Jacobson, but advised that no discovery would be provided unless Mr. Jacobson surrendered to the U.S. authorities. Mr. Weiss again expressed an interest in Mr. Jacobson pleading guilty and co-operating, indicating that if Mr. Jacobson surrendered voluntarily, he would be released on bail.

d. Following this second meeting with Mr. Weiss, Mr. Jacobson maintained that he wanted to fight the charges and extradition.

e. On October 26, 2007, Mr. Skurka and Ms. Heinen met with Mr. Weiss in Washington D.C. Mr. Skurka's evidence is that Mr. Weiss provided additional information about the Affpower scheme and advised that two people had pleaded guilty and five more were expected to plead guilty. Mr. Weiss again raised the prospect of having Mr. Jacobson plead guilty and cooperate, in exchange for which he may not have to face jail time.

f. On October 30, 2007, Mr. Skurka and Ms. Heinen met again with Mr. Weiss in Washington. At that time, Mr. Weiss played a portion of a wiretap recording involving a discussion between Mr. Jacobson and David Glass, who operated an Affpower plant in Costa Rica and was cooperating with the U.S. Government. The contents suggested that Mr. Jacobson may have known that drugs sold by Affpower were being sold without an in-person medical consultation.

g. Throughout November 2007, Mr. Skurka spoke to Mr. Weiss on a number of other occasions, thereby obtaining more information about the Affpower scheme, including that some of the prescriptions were being prepared and approved by people who were not physicians.

h. On November 27, 2007, Mr. Skurka and Ms. Heinen traveled to California, to meet with Mr. Elden to discuss the case. Amongst other matters, Mr. Elden confirmed the position taken by Mr. Weiss, that because of Mr. Jacobson's status, he was not entitled to any disclosure from the Government.

i. In December 2007, Mr. Jacobson met with Mr. Skurka and Ms. Heinen. Mr. Skurka's evidence is that Mr. Jacobson maintained that he wanted to contest the charges, but he nevertheless instructed them to see if a satisfactory agreement could be reached.

j. On December 18, 2007, Mr. Jacobson, Mr. Skurka and Ms. Heinen met with Mr. Weiss and another U.S. official. During the meeting, Mr. Weiss advised Mr. Jacobson that an agreement could be reached on the basis of Mr. Jacobson pleading guilty to money laundering and Mr. Jacobson cooperating with the U.S. Government's investigation. As part of the agreement, the Government would expect an indefinite period of cooperation, documents related to the plea would be sealed during the period of cooperation thereby allowing Mr. Jacobson to travel and continue with his business interests, and at some point the period of cooperation would end and a sentence would be imposed. Mr. Weiss gave Mr. Jacobson until January 14, 2008 to accept the offer, failing which formal extradition proceedings would be commenced.

k. In early January, Mr. Jacobson notified Mr. Skurka that he did not intend to plead guilty to money laundering and that he wanted to explore other options for resolving the charges against him. Mr. Skurka and Ms. Heinen prepared a draft letter to be sent to Mr. Weiss, which was reviewed and approved by Mr. Jacobson.

l. Before the letter was sent, on January 15, 2008, Mr. Skurka spoke to Mr. Weiss, at which time Mr. Weiss expressed impatience with Mr. Jacobson for resisting the guilty plea, and indicated that he was ready to start extradition proceedings and that an Interpol "red notice" would be issued. This meant that Mr. Jacobson could be arrested and extradited to the U.S. while traveling to other countries.

m. Mr. Skurka let Mr. Jacobson know about this conversation and, later in the day on January 15, 2008, Mr. Skurka met with Mr. Jacobson and a friend of Mr. Jacobson's. What happened at that meeting is the subject of some controversy and is addressed more fully in the analysis below.

n. On the morning of January 16, 2008, Mr. Skurka contacted Mr. Weiss and advised that Mr. Jacobson was considering the guilty plea offer. Mr. Skurka's evidence is that he made the call to ensure that there was no Interpol "red notice" placed on Mr. Jacobson. The U.S. Government gave Mr. Jacobson until the end of the day to make a decision.

o. In the afternoon of January 16, 2008, Mr. Jacobson met with Mr. Skurka and Ms. Heinen to further discuss the guilty plea. They discussed the consequences of pleading guilty as compared to the consequences of not accepting the U.S. Government's offer. At the end of the meeting, Mr. Jacobson instructed his lawyers to advise Mr. Weiss that he intended to plead guilty to a single count of money laundering.

p. Between January 2008 and April 2008, Mr. Skurka reviewed drafts of the U.S. Government's proposed guilty plea. Initially, Ms. Heinen and Mr. Elden were also involved in reviewing and commenting on the drafts. In late February 2008, Mr. Skurka requested that Ms. Holmes join Mr. Jacobson's defence team to provide advice on the sentencing guidelines that would be applied to sentence Mr. Jacobson at the end of the cooperation period.

q. In March 2008, Mr. Skurka obtained an opinion from Mr. Rubin providing advice about the legality of Affpower's online pharmacy business. As part of the opinion, Mr. Rubin provided a list of over 40 U.S. States that require physicians to perform an in-person examination before making a prescription.

r. In mid-April, Mr. Elden expressed some reservations about the draft plea agreement. After some consultation between Mr. Skurka and Ms. Holmes and with Mr. Jacobson's approval, Mr. Elden was discharged and, on April 30, 2008, Ms. Holmes took over as Mr. Jacobson's lead U.S. counsel. After that, negotiations over the plea agreement continued.

s. On May 6, 2008, Mr. Jacobson and Mr. Skurka traveled together to San Diego, California, where the guilty plea was to be entered the following day. In the afternoon of May 6, 2008, Mr. Jacobson met with Mr. Skurka, Ms. Holmes and B.J. Pak, a partner in Ms. Holmes' firm, to review the procedure that would be followed in Court and to review the guilty plea.

t. As mentioned above, on May 7, 2008, Mr. Jacobson pleaded guilty to one count of money laundering. As Ms. Holmes was not available to attend Court with Mr. Jacobson, Mr. Pak appeared with Mr. Jacobson.

[15] As part of his agreement to plead guilty, Mr. Jacobson also agreed to forfeit U.S. $4.5 million to the U.S. Government and agreed to cooperate with the Government in relation to its investigation of the online pharmacy business and other matters relating to the international flow of money. In exchange, the U.S. Government agreed to seal the guilty plea, to allow Mr. Jacobson to continue to travel internationally and to defer sentencing until after the period of cooperation was completed. Depending on the outcome of the cooperation, the U.S. Government indicated that it may consider a sentence that would not include any custodial time.

[16] After the guilty plea, Mr. Skurka continued to represent Mr. Jacobson for some time, providing assistance on issues arising from his cooperation with the U.S. Government. By 2011, Mr. Jacobson owed Mr. Skurka over $200,000 in unpaid legal fees. Mr. Skurka’s evidence is that he terminated the retainer in 2011 due to the unpaid accounts.

Withdrawal of the guilty plea

[17] After his guilty plea, Mr. Jacobson cooperated with the U.S. Government for a number of years. His evidence is that he found the cooperation requirements to be increasingly onerous and challenging. Originally, the U.S. Government’s requests for cooperation focused on Mr. Jacobson’s knowledge of the online pharmacy business, but over time he was asked to assist with unrelated matters.

[18] Mr. Jacobson’s evidence is that, in early 2012, he was scheduled to return to the U.S. for sentencing. He was first required to attend a meeting with his probation officer who was to prepare a pre-sentencing report. Mr. Jacobson did not go to the U.S. and, instead, he sent a letter to the probation officer, in part making a number of serious allegations against Mr. Skurka, including that Mr. Skurka was being investigated criminally. A few months later, still having not returned to the U.S., Mr. Jacobson became aware that he was subject to an arrest warrant. Mr. Jacobson then retained Mr. Gordner and Mr. Attanasio. Amongst other matters, Mr. Jacobson’s new lawyers brought an application to withdraw Mr. Jacobson's guilty plea in part on the ground of ineffective counsel.

[19] The hearing proceeded in 2014, and Mr. Skurka appeared as a witness. Ultimately, the Court in the U.S. did not decide the issue. Rather, in September 2014, Mr. Jacobson reached and an agreement with the U.S. Government and the charges were dismissed on certain conditions.

Claim against Mr. Skurka

[20] On May 2, 2014, Mr. Jacobson commenced an action against Mr. Skurka. Around the same time, he commenced separate actions against Ms. Heinen and against Ms. Holmes and her law firm.

[21] In his action against Mr. Skurka, Mr. Jacobson claims $1,700,000 for the legal fees he paid to Mr. Skurka, $10,000,000 in general damages, $10,000,000 in special damages for loss of income and business opportunities, over $1,000,000 in damages for legal fees paid to lawyers subsequent to Mr. Skurka, and aggravated damages of $3,500,000 and punitive damages of $1,000,000.

[22] In his claim, Mr. Jacobson alleges that Mr. Skurka put undue pressure on him to plead guilty, and that he was negligent in his representation of Mr. Jacobson including in failing to get proper disclosure from the U.S. Government and by improperly giving Mr. Jacobson advice on U.S. law when he was not qualified to do so.

Procedural History

[23] The defendants in all three actions scheduled motions for summary judgment to be heard together. In advance of the motions, the defendants served their motion materials. Mr. Skurka’s motion materials include an affidavit he swore and an opinion from a U.S. lawyer on disclosure obligations in criminal proceedings in the U.S. Ms. Heinen swore an affidavit in support of her motion for summary judgment, and Ms. Holmes and Mr. Pak swore separate affidavits in support the motion for summary judgment brought by Ms. Holmes and her firm. In response, Mr. Jacobson's lawyer served a responding record containing an affidavit sworn by Mr. Jacobson.

[24] Before the motions proceeded, the actions against Ms. Heinen and Ms. Holmes were dismissed on consent. It was then agreed that Mr. Skurka’s motion for summary judgment would proceed on October 16, 2017, and that the evidence filed by Ms. Heinen and Ms. Holmes would form part of the record on the motion.

[25] In advance of the date of the motion, Mr. Jacobson's lawyer indicated that he intended to remove himself from the record. The parties then participated in a case management conference with Justice McEwen. At that time, it was suggested that the hearing dates could be used for in court cross-examinations, because cross-examinations on the parties’ affidavits had not yet taken place.

[26] The matter came before me on October 16, 2017. At the beginning of the hearing, Mr. Jacobson's lawyer formally removed himself from the record. Mr. Jacobson indicated that he hoped to retain new counsel, but he did not object to being cross-examined on his affidavit to allow the matter to move forward. Accordingly, his cross-examination was scheduled for the next day and was completed on a second attendance on November 14, 2017.

[27] Subsequently, I held a number of case conferences to deal with ongoing scheduling issues. Throughout, the objective was to give Mr. Jacobson an opportunity to retain counsel for the next steps in the motion for summary judgment, while ensuring that the matter moved forward. Ultimately, Mr. Jacobson did not retain counsel. He indicated that he was unable to do so because he was having difficulties getting the funds required for his new lawyer's retainer into Canada.

[28] Mr. Jacobson therefore represented himself at his own cross-examinations, at Mr. Skurka's cross-examination on March 7, 2018 (which was also conducted in court before me), and at the hearing of the argument on March 28, 2018. I note that, while Mr. Jacobson was given many opportunities to retain counsel between October 16, 2017 and March 2018, he did not request an adjournment at the hearing of the motion nor had he requested adjournments on the days when cross-examinations proceeded.

Positions of the parties

[29] Mr. Skurka argues that there is no genuine issue for trial, and that, on the record for the motion for summary judgment, it is evident that he did not coerce Mr. Jacobson to plead guilty and that he was not otherwise negligent in his representation of Mr. Jacobson. Mr. Skurka also argues that Mr. Jacobson's action is statute barred pursuant to the Limitations Act, 2002, S.O. 2002, c.24, Sched. B.

[30] In response to the motion, Mr. Jacobson focuses on four specific complaints against Mr. Skurka, which he argues give rise to genuine issues for trial, claiming that:

a. Mr. Skurka pressured him into accepting the guilty plea;

b. Mr. Skurka was negligent in accepting the U.S. Government's position that no further disclosure would be provided;

c. Mr. Skurka was not competent to practice U.S. law or to provide advice to Mr. Jacobson on U.S. law; and

d. Mr. Skurka was negligent in failing to consider Mr. Elden's reservations about the guilty plea.

Test on a motion for summary judgment

[31] Under subrule 20.04(2), summary judgment is to be granted if the Court is satisfied that there is no genuine issue requiring a trial.

[32] As set out in Hryniak v. Mauldin, 2014 SCC 7, at para. 49:

there will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits using the summary judgment process. This is the case when the process: "(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 and less expensive means to achieve a just result.”

[33] On a motion for summary judgment, the judge should first determine if there is a genuine issue requiring a trial based on the evidence before him or her without using the fact-finding powers in subrule 20.04(2.1). If there appears to be a genuine issue requiring a trial, Rule 20.04(2.1) permits the motion judge, at his or her discretion, to: (1) weigh the evidence, (2) evaluate the credibility of a deponent, or (3) draw any reasonable inference from the evidence unless it is in the "interest of justice" for these powers to be exercised only at trial: Hryniak, at para. 66. The motion judge is also permitted to use the expanded powers under Rule 20.04(2.2) to direct a procedure such as a mini-trial, rather than a full trial.

[34] The responding party may not rely on the prospect of additional evidence that may be tendered at trial; the respondent must put his or her best foot forward on the motion for summary judgment: Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200 (Ont. S.C.J.), at para. 26, aff'd 2014 ONCA 878 (Ont. C.A.), leave to appeal to SCC refused, [2015] S.C.C.A. No. 97 (S.C.C.).

[35] In Sanzone v. Schecter, 2016 ONCA 566, at paras. 21 and 22, the Court of Appeal addressed cases such as this one where a respondent on a motion for summary judgment is self-represented:

Fairness requires a judge to accommodate a self-represented party's unfamiliarity with the litigation process to enable her to present her case to the best of her ability: Davids v. Davids (1999), 125 O.A.C. 375 (C.A.), at para. 36 …

Of course, any accommodation made by a judge to a self-represented party must respect the rights of the other party: Davids, at para. 36. A defendant is entitled to expect that a claim of liability brought against it will be deciced [sic] by the same rules of evidence and substantive law whether the plaintiff is represented by counsel or self-represented.

Issues

[36] The issue to be decided on this motion is whether the following matters raise issues that require a trial:

a. Did Mr. Skurka coerce Mr. Jacobson into accepting the guilty plea?

b. Was Mr. Skurka otherwise negligent in his representation of Mr. Jacobson?

c. Is the action against Mr. Skurka statute barred?

Issue 1 - Did Mr. Skurka coerce Mr. Jacobson into accepting the guilty plea?

[37] Mr. Jacobson claims that he was coerced into accepting the guilty plea. In particular, he claims that at the meeting on the evening of January 15, 2008, Mr. Skurka scared him into accepting the guilty plea, and that he agreed to plead guilty although he has always maintained that he was innocent.

[38] Mr. Skurka disputes that he coerced Mr. Jacobson into accepting the guilty plea at the January 15, 2008 meeting or at any other time. He takes the position that Mr. Jacobson made the decision after receiving extensive advice on the pros and cons of pleading guilty, and that, once Mr. Jacobson made the decision to plead guilty, he did not change his mind until a few years later.

[39] Based on the record before me, I do not accept Mr. Jacobson's assertion that Mr. Skurka coerced him into pleading guilty.

[40] In support of his position, Mr. Jacobson relies primarily on his account of what happened at the meeting of January 15, 2008. Mr. Jacobson argues that the January 15, 2008, meeting was pivotal. He claims that it was in the context of that meeting that he decided to plead guilty, and that his decision was based on undue pressure Mr. Skurka placed on him.

[41] Mr. Jacobson's evidence about this meeting is that Mr. Skurka contacted him on the morning of January 15, 2007, to advise of his discussions with U.S. authorities earlier that day, including the warning that an Interpol red alert would be placed on Mr. Jacobson if he did not accept the plea bargain. Mr. Jacobson then contacted a trusted friend who was also a lawyer in Toronto, and they attended the meeting with Mr. Skurka later that evening. Mr. Jacobson claims that, during the meeting, Mr. Skurka told him that he was an expert in the American justice system, and that it would be impossible for him to get a fair trial. He claims Mr. Skurka said that, even if he was innocent and did not know what Affpower was doing, he would be “crushed like a walnut” and found guilty and sentenced to 27 years in jail. Mr. Jacobson also claims that Mr. Skurka made reference to his wife being sick, and said that if he went to jail it would kill his wife and leave his daughter homeless.

[42] Mr. Jacobson claims that he maintained that he was not guilty throughout the meeting with Mr. Skurka, and that, out of worry for his family, he ultimately told Mr. Skurka at the end of the meeting that he would he plead guilty even if he was innocent.

[43] Mr. Skurka's evidence about what occurred at the meeting is different from Mr. Jacobson's evidence. Mr. Skurka says that he did not provide any advice to Mr. Jacobson during the meeting but, rather, that he answered questions from Mr. Jacobson and his friend. Mr. Skurka claims that, by the end of the meeting, Mr. Jacobson was considering a guilty plea, and that he was particularly concerned about the prospect of an Interpol red notice, and that he was also concerned about the effect the prosecution would have on his family. Mr. Skurka adamantly denies coercing or pressuring Mr. Jacobson into pleading guilty at the meeting or at any other time.

[44] The issue of what happened at the meeting turns largely on credibility. On a motion for summary judgment, as provided in Rule 20.04(2.1) of the Rules of Civil Procedure, I have the power to make findings of credibility. In this case, I have the added benefit of having heard and seen the viva voce cross-examinations of Mr. Jacobson and Mr. Skurka.

[45] Based on the full record on the motion, I am confident that I can decide the issue of whether Mr. Jacobson was coerced into accepting the guilty plea at the January 15th meeting or at any other time.

[46] I find Mr. Jacobson's evidence about what happened at the January 15, 2007, meeting self-serving and not credible. He has not produced any evidence from the friend who was present at the meeting that supports his version of what happened. Mr. Jacobson has admitted to lying on other occasions. For example, on May 11, 2012, the email he sent to the U.S. probation officer falsely stated that there "is currently a criminal investigation into my Canadian Lawyer, Steven Skurka", that Mr. Skurka conspired with U.S. prosecutors so that he would get a percentage of the money forfeited by Mr. Jacobson, and that Mr. Skurka sold Mr. Jacobson's file to Ukranian organized crime organizations in order to defraud Mr. Jacobson. Mr. Jacobson has since acknowledged that these outlandish claims were false. In addition, given his current position that he was innocent of the charges against him in the U.S., he also admittedly lied to the Court at the time he entered his guilty plea or he is not telling the truth in these proceedings when he claims that he was innocent.

[47] Besides my assessment of Mr. Jacobson's credibility, in my view, there is extensive evidence, based on what happened after the meeting that Mr. Jacobson's guilty plea was voluntary and that he did not in fact maintain his innocence up to the time when he pled guilty.

[48] First, on January 16, 2008, following the January 15th meeting, Mr. Jacobson met with Mr. Skurka and Ms. Heinen before Mr. Jacobson's decision to plead guilty was communicated to the U.S. Government. During the course of the meeting, Mr. Skurka and Ms. Heinen reviewed the strengths and weaknesses of the case and the pros and cons of pleading guilty. Following the meeting, Ms. Heinen prepared a memo in which she memorialized what happened at the meeting, which included the following:

Further to Steven's meeting with Nathan yesterday evening, a further meeting was held to discuss the consequences of a plea of guilty with the client. In particular, the following issues were discussed: (1) the plea of guilty would be to the felony charge and money laundering. This means that Nathan is a convicted felon; (2) a plea to this charge would likely have an impact in Nathan's ability to travel particularly to the United States. He may be excluded from entering the United States as a result of his conviction; (3) a plea will likely also have significant consequences on his business. A conviction for money laundering could preclude him from taking his companies public, could impact on future business dealings, could impact on his future dealings with governments, and could cause Mastercard, VISA or any bank to refuse to deal with him; (4) although the plea record will be sealed pending his cooperation, at the end of his cooperation, if he were to testify in a proceeding, the fact of his plea could become public; (6) competitors can disseminate news of his indictment and any other rumors; (6) [sic] there is no guarantee that the plea will remain confidential for any period of time; (7) the nature of the cooperation is at the discretion of the US authorities; (8) the length of the cooperation is at the discretion of the authorities; (9) while the government indicated that it is entirely possible as a result of cooperation that they would recommend no incarceration, there is no guarantee of no incarceration and he may face a period of incarceration at the end of his cooperation; (10) the plea will involve monetary penalties which will be determined by the government; (11) he will have to work with various law enforcement agencies.

Nathan was advised of the fact that benefits of the plea are that (1) there would be certainty in the proceedings; (2) there is a better likelihood that he would not go to jail if the government so recommends; (3) the government indicated that they would advise the financial institutions of his cooperation in the hope they will continue to deal with Nathan.

Nathan was also advised that in our view, based on his prior assertions of innocence and based on the information we have seen to date, the case was defensible in a court of law. It was made clear that this opinion was expressed solely on the basis of the information we had received to date which was extremely limited and based on information from the prosecutor as well as Nathan's recollection. Nathan indicated that it is possible that he may have said something "reckless" that he can no longer recall.

At the end of the meeting, Nathan instructed that we communicate with the US government that he wished to proceed with a plea of guilty to one charge of money laundering. He advised that he did not wish to consider the matter further. Steven specifically advised Nathan that he could not plead guilty to an offence unless he was in fact guilty and so acknowledged…

[49] When cross-examined about this memo, Mr. Jacobson did not dispute Ms. Heinen's account of what happened at the meeting, with the exception of her statement that Mr. Jacobson was advised that he could not plead guilty if he was innocent. I accept Mr. Skurka and Ms. Heinen's account of what happened. Ms. Heinen's note was made immediately after the meeting, and it was reviewed by Mr. Skurka. In any event, in my view, not much turns on this issue. As reviewed below, it was made clear to Mr. Jacobson at the guilty plea hearing that he could not plead guilty unless he was guilty.

[50] As confirmation that he was satisfied with the January 16th meeting and with his decision to plead guilty, after the conclusion of the meeting, Mr. Jacobson sent Mr. Skurka and Ms. Heinen an email which opened: "Dear Steve and Marie, First, thank you for today. I think it was a very important day in this process." Mr. Skurka also has a diary entry from January 18th in which he records a conversation during which Mr. Jacobson stated that he had "no regrets over his decision to plead guilty and cooperate".

[51] Second, after the meeting of January 16, 2008, and after the U.S. Government was made aware of Mr. Jacobson's intention to plead guilty, the terms and wording of the plea agreement were negotiated over a period of a few months. During this period, Mr. Jacobson had an opportunity to review drafts of the plea agreement. Ultimately, the plea agreement signed by Mr. Jacobson contained a recitation of the facts acknowledged by Mr. Jacobson and the following terms:

DEFENDANT'S REPRESENTATION THAT GUILTY PLEA IS KNOWING AND VOLUNTARY Defendant represents that: Defendant has had a full opportunity to discuss all the facts and circumstances of this case with defence counsel, and has a clear understanding of the charges and the consequences of this plea; No one has made any promises or offered any rewards in return for this guilty plea, other than those contained in this plea agreement or otherwise disclosed to the court; No one has threatened defendant or defendant's family to induce this guilty plea; and Defendant is pleading guilty because in truth and in fact defendant is guilty and for no other reason.

DEFENDANT AND COUNSEL FULLY UNDERSTAND AGREEMENT By signing this plea agreement, defendant certifies that defendant has read it. Defendant has discussed the terms of this plea agreement with defence counsel and fully understands its meaning and effect.

DEFENDANT SATISFIED WITH COUNSEL Defendant has consulted with counsel and is satisfied with counsel's representation.

[52] Third, in advance of signing the guilty plea and attending the hearing, on May 6, 2008, Mr. Jacobson participated in a meeting in San Diego with Mr. Skurka, Ms. Holmes and Mr. Pak. All three lawyers have provided separate affidavit evidence about the meeting. Their evidence confirms that the meeting lasted several hours, during which they reviewed the plea agreement with Mr. Jacobson. Mr. Pak's evidence is that he told Mr. Jacobson that he still had the option to plead not guilty. However, both Ms. Holmes and Mr. Pak's evidence is that Mr. Jacobson acknowledged his guilt during the meeting and was definitive about wanting to plead guilty. While Mr. Jacobson asserts on this motion that, at the meeting, he said that it was "ridiculous" that he was pleading guilty when he was not guilty, as mentioned above, I do not find his evidence credible, and his evidence is contradicted by more than one witness who was present at the meeting.

[53] Fourth, at the hearing on May 8, 2008, under oath, Mr. Jacobson confirmed to the judge presiding at the hearing that he had had sufficient time to discuss the matter with his lawyer, that he was satisfied with Mr. Pak's services, that he understood that he was giving up his right to a trial, that no one had made any threats or forced him into pleading guilty and that he understood the penalties that he could face by pleading guilty. The judge at the hearing also went through all of the facts that formed the basis for the guilty plea, and Mr. Jacobson acknowledged knowing each of those facts as they were reviewed.

[54] Accordingly, based on the comprehensive record dealing with the circumstances under which Mr. Jacobson pled guilty to the charge of money laundering, I see no basis for his claim that Mr. Skurka coerced him into accepting the guilty plea. His evidence on this point is self-serving and after the fact evidence that flies in the face of a significant body of evidence that demonstrates that his guilty plea was made voluntarily, that he understood that he could not plead guilty if he was innocent, and that once he decided to plead guilty in mid-January 2008 he did not express any doubts about his decision or state that he was in fact innocent. I also note that Mr. Jacobson's focus on the January 15th meeting is misplaced; there is nothing that would have prevented him from changing his mind up until May 7, 2008, and he was advised of this on more than one occasion.

[55] In the context of criminal law decisions dealing with the voluntariness of guilty pleas, the courts have commented that the decision to plead guilty is necessarily a difficult and stressful one. For example, in R. v. Carty, 2010 ONCA 237, at para. 37, the Court of Appeal made the following observation:

That decision by its very nature must be made when individuals are under considerable pressure. That pressure is often the product of the grim realization that there is no viable alternative to a guilty plea, and that the consequences of a guilty plea will be immediate, serious and far-reaching. The pressures inherent in the nature and timing of the decision to plead guilty cannot in and of themselves invalidate a guilty plea on appeal. People are capable of deciding what is in their best interests even when they are under considerable pressure and none of the available options are attractive.

[56] I have no doubt that Mr. Jacobson's decision to plead guilty was a difficult and stressful one, and that he came to regret that decision. However, I do not see any basis for finding that Mr. Skurka placed undue pressure on him to plead guilty.

[57] I must address one final point before concluding on this issue. In support of his claim that he was coerced into accepting the guilty plea, Mr. Jacobson relies heavily on the fact he was later successful in withdrawing the plea. In my view, this fact has no relevance to the claim. While Mr. Jacobson applied to the Court in California to withdraw his guilty plea in part on the grounds of ineffective counsel, the Court did not make a decision on this issue. Rather, before the completion of the proceedings, on September 3, 2014, Mr. Jacobson and the U.S. Government entered into a Non-Prosecution Agreement, that provided inter alia for the dismissal of all charges against Mr. Jacobson. The Agreement does not set out the reason for the dismissal, but simply states that the agreement is made in the "interests of justice and to provide finality in this decade-long investigation and prosecution". The agreement also provides that the U.S. Government retains the right to reinstate certain charges and that the U.S. Government is to retain the forfeiture amount of $4.5 million. At the hearing held to approve the Non-Prosecution Agreement and the withdrawal of Mr. Jacobson's guilty plea, the Government lawyer suggested that the basis for the decision to withdraw the charges against Mr. Jacobson was tied to the outcome of the prosecutions against the other defendants named in the indictment, advising the Court that:

…the Government believes that at this point, in view of the disposition of the defendants that were in this case including the last round of dispositions, we believe this is in the interests of justice.

[58] Therefore, while Mr. Jacobson was ultimately able to withdraw his guilty plea, there was no finding by the Court in California that Mr. Skurka provided ineffective counsel leading up to the guilty plea, and therefore, in my view, the final outcome of the U.S. criminal proceedings is not relevant to determining the issue of whether Mr. Skurka put undue pressure on Mr. Jacobson to accept the guilty plea or was otherwise ineffective or negligent in his representation of Mr. Jacobson.

[59] During argument, Mr. Jacobson urged me to read the transcript from Mr. Skurka's examination from the hearing in California, and to make a determination about Mr. Skurka's conduct based on that transcript. However, as Mr. Skurka points out, in the context of the proceedings in Calirfornia, Mr. Jacobson had not waived solicitor client privilege, and therefore Mr. Skurka was somewhat limited in the answers he could provide. The evidence before me on this motion does not suffer from the same defect.

[60] Accordingly, based on my review of the comprehensive evidence regarding the events leading to the guilty plea, I am satisfied that Mr. Jacobson's claim that Mr. Skurka coerced him into pleading guilty does not raise a triable issue. On the record before me, I am confident that I can find that Mr. Skurka did not put undue pressure on Mr. Jacobson to plead guilty during the January 15, 2008, meeting or at any other time.

Issue 2 -- The negligence claims do not raise any triable issues

[61] Besides the claim of coercion, Mr. Jacobson alleges that Mr. Skurka was negligent in the following respects:

a. that Mr. Surka improperly practiced American criminal law when he was not competent to do so;

b. that Mr. Skurka was negligent in failing to obtain further disclosure, and in particular full disclosure of the wiretap evidence; and

c. that he was negligent in failing to heed Mr. Elden's advice regarding his reservations about the guilty plea.

[62] Again, I do not accept that these claims of negligence give rise to a triable issue.

[63] A lawyer is required to bring reasonable care, skill and knowledge to the performance of professional skills he or she undertakes. The standard by which his or her conduct is measured is a question of law and whether he or she has met these obligations is a question of fact: McNeil v. Kansa General International Insurance Co., [2000] O.J. No. 3309 (C.A.) at para. 11. Generally, the standard of care to which a professional will be held requires expert evidence: Krawchuck v. Scherbak, 2011 ONCA 352 at para. 130. There are some exceptions to this requirement. For example, in Krawchuk, at para. 133, the Court of Appeal held that one of those exceptions is when the court is faced with "non-technical matters or those of which an ordinary person may be expected to have knowledge"; see also Larizza v. Royal Bank of Canada, 2018 ONCA 632, at para. 37.

[64] In this case, neither party has filed expert evidence. Mr. Skurka argues that he does not require expert evidence because the burden of proving that he fell below the standard of care lies with Mr. Jacobson.

[65] For his part, Mr. Jacobson argues that he could not provide an expert report at this stage in the proceedings because of his current financial difficulties, but that he plans to have expert evidence available at trial.

[66] As reviewed above, in opposing a motion for summary judgment, the case law is clear that Mr. Jacobson must put his best foot forward and cannot rest on an argument that better evidence will be available at trial. Accordingly, while one might have sympathy for Mr. Jacobson's financial challenges, this is not a sufficient reason to relieve him from the obligation to put his best foot forward on this motion, especially when it is unclear if and when he may be in a better position to present expert evidence.

[67] Therefore, in the absence of expert evidence from Mr. Jacobson, there is no basis for finding that the allegations of negligence he makes against Mr. Skurka raise a triable issue.

[68] In any event, even if on a motion for summary judgment involving professional negligence the defendant's burden of showing that there is no triable issue required the defendant to adduce expert evidence, in my view, this is a situation in which the allegations made against Mr. Skurka can be disposed of without expert evidence as a matter of fact or common sense.

Mr. Skurka did not improperly provide advice on matters of U.S. law

[69] Mr. Jacobson alleges that Mr. Skurka provided him with advice and representations on matters of U.S. criminal law when he was not competent to do so.

[70] I do not accept this argument.

[71] As Mr. Skurka points out, it was appropriate for Canadian counsel to be involved in the case because Mr. Jacobson faced extradition proceedings. In addition, from the beginning of the retainer, and with Mr. Jacobson's agreement, Mr. Skurka retained U.S. counsel to assist and represent Mr. Jacobson in the U.S. Initially, Mr. Elden was retained, and then Ms. Holmes and Mr. Pak were retained. In addition, Mr. Skurka sought out an opinion from Mr. Rubin on the legality in the U.S. of the internet pharmacy scheme.

[72] While Mr. Skurka did attend a number of meetings with U.S. authorities, Mr. Jacobson’s U.S. lawyers were also often present. Even if they were not present, Mr. Skurka's evidence is that he consulted with them before and after such meetings or communications. For example, Mr. Skurka consulted with Mr. Elden immediately after the meeting in Washington D.C. where U.S. authorities presented the wiretap evidence. Similarly, Mr. Skurka spoke to Mr. Elden immediately after the January 15, 2008 call from Mr. Weiss.

[73] U.S. counsel were also actively involved throughout the negotiation of the guilty plea.

[74] Ultimately, Mr. Jacobson met with Ms. Holmes and Mr. Pak for several hours on the day before entering his guilty plea. He received direct advice from them about the consequences of pleading guilty.

[75] Finally, while Mr. Jacobson alleges that Mr. Skurka improperly provided advice on matters of U.S. law, he has not identified any specific issues on which Mr. Skurka provided incorrect advice or any evidence that Mr. Skurka's advice or services were incorrect or led to any losses.

Mr. Skurka was not negligent in failing to get full disclosure from the U.S. Government

[76] Mr. Jacobson maintains that Mr. Skurka failed to ensure that the U.S. Government provided full disclosure of the case against him. In particular, Mr. Jacobson focuses on the wiretap information that U.S. authorities shared with Mr. Jacobson and Ms. Heinen at the October 30, 2007 meeting, arguing that if they had obtained a transcription of the complete interaction it would have been evident to them that Mr. Jacobson was not guilty.

[77] Again, I do not accept that this aspect of Mr. Jacobson's claim raises a triable issue.

[78] Mr. Skurka asserts that, under U.S. law, Mr. Jacobson was not entitled to any disclosure as long as he remained outside of the U.S. and did not surrender to U.S. authorities. This was the advice Mr. Skurka received from Mr. Elden at the time he represented Mr. Jacobson.

[79] In addition, for the purpose of this motion, Mr. Skurka has produced an expert report on U.S. law that confirms this view. The evidence comes from David O'Neil, a criminal law lawyer who practices in Washington D.C. with the law firm Debevoise & Plimpton LLP. Mr. O'Neil's report contains the following summary of U.S. law:

U.S. law does not entitle an indicted foreign defendant to discovery when he remains outside the U.S., and under longstanding practice, federal prosecutors would refuse counsel's request for discovery unless and until the defendant returned to the U.S. to confront the charges against him.

[80] Mr. Jacobson has not provided a countervailing opinion.

[81] Accordingly, I do not find that Mr. Skurka was negligent in failing to pursue further disclosure from the U.S. Government and I find that this is not a triable issue.

Mr. Skurka was not negligent in assessing Mr. Elden's reservations about the guilty plea

[82] Mr. Jacobson relies on a memo prepared by Mr. Elden in April 2008, in which Mr. Elden expressed some reservations about Mr. Jacobson’s guilty plea.

[83] Again, I do not accept that this establishes any negligence on Mr. Skurka’s part.

[84] It is evident that, following receipt of the memo, Mr. Skurka consulted at length with Ms. Holmes, that she spoke directly to Mr. Elden, and that ultimately she did not have concerns that Mr. Elden’s reservations formed the basis for not proceeding with the guilty plea. Accordingly, Mr. Skurka did not disregard Mr. Elden’s reservations, but rather ensured that Mr. Jacobson had the benefit of advice from U.S. counsel on the issues.

[85] I am satisfied that Mr. Jacobson’s claims of negligence against Mr. Skurka do not raise a triable issue.

Issue 3 -- The action is not statute barred

[86] Mr. Skurka argues that Mr. Jacobson's claim is barred by the two year limitation period in the Limitations Act, 2002, which provides that "a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered".

[87] Section 5(1) of the Limitations Act, 2002, provides that a claim is discovered on the day that a person knew or reasonably ought to have known of the material facts giving rise to the cause of action. Section 5(2) provides that a person is presumed to have known about the facts giving rise to the cause of action on the day on which the act or omission on which the claim is based took place, unless the contrary is proven.

[88] Mr. Skurka argues that Mr. Jacobson ought to have known about his claim against Mr. Skurka when he pled guilty, on May 7, 2008.

[89] Mr. Jacobson's position is that he could not have known about his claims against Mr. Skurka before his guilty plea was rescinded and the charges against him were dismissed.

[90] I accept Mr. Jacobson's position. While I did not accept Mr. Jacobson's argument that the vacating of his guilty plea supports his claim against Mr. Skurka, he had nevertheless initiated the process on the basis of a claim of ineffective representation by Mr. Skurka. Under the circumstances, I accept his position that he could not have "discovered" his claim against Mr. Skurka until the guilty plea was vacated and the charges against him were dismissed. Otherwise, his action would likely amount to a collateral attack on the California Court's decision to accept his guilty plea.

[91] While I agree with Mr. Jacobson on this issue, it has no bearing on the outcome of this motion as I have found that his claim against Mr. Skurka does not raise any triable issues.

Conclusion

[92] For the reasons above, based on the record available on the motion for summary judgment, which included the viva voce cross-examinations of both Mr. Skurka and Mr. Jacobson and affidavit evidence from other lawyers involved in defending Mr. Jacobson in the U.S. proceedings, I am confident that I can make a fair and just determination in this case. Based on my review of all the evidence, I am satisfied that Mr. Jacobson's claim against Mr. Skurka does not raise any triable issues. Accordingly, the motion for summary judgment is granted and the claim against Mr. Skurka is dismissed.

[93] I would encourage Mr. Skurka and Mr. Jacobson to reach agreement on the issue of costs. If they are not able to do so, counsel for Mr. Skurka is to make submissions not exceeding five pages by no later than August 10, 2018, and Mr. Jacobson is to make submissions not exceeding 5 pages by no later than August 31, 2018. The submissions can be sent to my assistant's attention at Madalena.Filici@ontario.ca.

FAVREAU J.

RELEASED: July 23, 2018