SUPERIOR COURT OF JUSTICE – ONTARIO
RE: ADEL ABOBAKER, Applicant
AND:
HALA NASIF MAKKI also known as HALA NASSIK MAKKI, Respondent
BEFORE: Justice Irving André
COUNSEL: Matthew Kim, counsel for the Moving Party, Landy Marr Kats LLP.
Philip Underwood, counsel for the Respondent
HEARD: April 13, 2021, via video conference
ENDORSEMENT
1The former counsel for the Applicant, Landy Marr Kats LLP (“LMK”) brings a motion for a charging order in its favour pursuant to s. 34 of the Solicitors Act, on any judgment, settlement funds or proceeds of sale obtained by the Applicant in the action against the Respondent, Hala Nasif Makki. The Applicant opposes the motion on the ground that the moving party has adduced no evidence to justify the order sought.
BACKGROUND
2The Applicant, Adel Abobaker, and Respondent were married and currently reside in California.
3Following the breakdown of their marriage the parties initiated court actions in California to determine their entitlement to various Canadian properties acquired during the course of their marriage including five properties they owned in Mississauga, Burlington and Oakville.
4On September 22, 2020 a California court ruled that the “most sensible division awards the properties to one party, who shall buy out the other party’s interest”. The Applicant was required to pay Ms. Makki $875,929 in exchange for ownership of the properties on or before October 5, 2020, failing which the properties would be listed for sale and the net sale proceeds divided equally. One of the properties has been sold as a result of a Power of Sale.
5On March 23, 2021, Bielby J. made an order removing LMK and Matthew J. Kim as lawyers of record for Adel Abobaker. Bielby J. adjourned the balance of the motion brought by LMK to April 13, 2021, “to allow the plaintiff time to retain counsel and/or obtain legal advice in regard to solicitor’s liens.”
ANALYSIS
6This motion raises the following issue: Should the court grant the motion brought by LMK for a charging order on any judgment, settlement funds or proceeds of sale obtained by Adel Abobaker in the subject properties?
THE LAW
7Section 34 of the Solicitors Act provides as follows:
- (1) Where a solicitor has been employed to prosecute or defend a proceeding in the Superior Court of Justice, the court may, on motion, declare the solicitor to be entitled to a charge on the property recovered or preserved through the instrumentality of the solicitor for the solicitor’s fees, costs, charges and disbursements in the proceeding.
8In order to obtain a charging order or a lien on monies owed by a former client, the onus is on the solicitor to demonstrate that a charging order or lien is warranted: see Weenen v. Biadi, 2018 ONCA 288, at para. 14. The Court of Appeal in that case, set out, at para. 15, the following test for a charging order under s. 34:
The test for a charging order under s. 34 is clear. To obtain a s. 34 charging order a solicitor must demonstrate that:
i. the fund or property is in existence at the time the order is granted: Langston v. Landen, [2008] O. J. No 4936 (Ont. S.C.J.), at paras. 28-29;
ii. the property was “recovered or preserved” through the instrumentality of the solicitor; Kushnir v. Lowry, [2003] O.J. No. 4093 (C.A.), at para. 2;
iii. there must be some evidence that the client cannot or will not pay the lawyer’s fees; Kushnir, at para. 2; see also Guergis v. Hamilton, 2016 ONSC 4428, at para. 6; Thomas Gold Pettinghill LLP, at para. 88; Foley, at p. 202.
9In Taylor v. Taylor (2002), 2002 CanLII 44981 (ON CA), 60 O.R. (3d) 138 (C.A.), [2002] O.J. No. 2313, the Court noted at para. 28 that s. 34 codifies the court’s “inherent jurisdiction in equity to declare a lien on the proceeds of judgment where there appears to be good reason to believe that the solicitor would otherwise be deprived of his or her costs.”
ANALYSIS
Is the fund or property in existence at the time the order is granted?
10Counsel for the moving party indicates that some of the subject Canadian properties are still partially or wholly owned by Mr. Abobaker and that they may be sold before the court deals with the issue of a charging order.
11Opposing counsel submits that I should not rely on the documentary evidence submitted in camera proving that Mr. Abobaker retained the law firm of LMK to act as his counsel in the legal proceedings against Ms. Makki. Stacey Found, LMK’s law clerk, deposed that Mr. Abobaker owes LMK $20,237.48 and “has failed to pay outstanding accounts and to provide further financial retainer towards next steps in the matter”. The exchange of correspondence between the law firm and Mr. Abobaker attached to Ms. Found’s affidavit dated March 9, 2021, clearly shows that Mr. Abobaker is very much aware of the amount claimed by LMK for services rendered.
12In these circumstances, the moving party should be allowed to rely on this evidence to demonstrate that a charging order is warranted. Mr. Abobaker is aware of the amount claimed by his former counsel for services rendered. He cannot successfully oppose the granting of a charging order on the ground that there is no evidentiary basis for the court to exercise its discretion to granting such an order. In my view, in deciding whether or not to grant the request for the order I am obliged, as the court stated in Taylor¸ at para. 34, to “balance the circumstances and equities of each case and client”.
Was the property “recovered” or “preserved” through the instrumentality of the solicitor?
13In my view, it was. Mr. Abobaker retained LMK. in his application against Ms. Makki with respect to the five subject properties. LMK was involved in motions brought on November 4 and 20, 2020 and January 5, 2021 resulting in court orders granting leave to issue Certificates of Pending Litigation. To that extent, Mr. Abobaker’s ability to recover the subject property has been preserved “through the instrumentality of LMK”. Accordingly, this condition has been met.
Is there some evidence that Mr. Abobaker cannot or will not pay LMK’s fees?
14There is. He has not paid the outstanding amounts despite repeated requests. He vehemently opposes the motion for the granting of a charging order. He clearly has no intention of paying any amount owed to LMK. This is not a situation, as existed in Keenan, where the client contested the amount owed to the law firm or paid a substantial portion of the outstanding debt. Mr. Abobaker has not acknowledged the indebtedness and is unwilling to pay. To that extent, this condition has been met.
CONCLUSION
15I am prepared, in the circumstances of this case, to exercise my discretion to grant the requested charging order. The motion is therefore allowed.
COSTS
16LMK seeks costs in the amount of $1,500 on a partial indemnity basis while Mr. Abobaker seeks costs in the amount of $1,700 on a similar basis.
17In considering what quantum of costs is fair and reasonable in this matter, I consider the following factors:
a. LMK was substantially successful in this motion;
b. The issue was moderately complex and involved some preparation, including the preparation of affidavits.
18Order to go that Mr. Abobaker pays costs fixed in the amount of $1,500 inclusive, to Landy Marr Kats LLP within sixty (60) days of today’s date.
André J.
Date: April 21, 2021