COURT FILE NO.: CV-20-649263
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: YEBIT LIM, by her Litigation Guardian, HYUN JIN CHO
AND:
DANIEL JENNINGS and JENNIFER SLAUENWHITE
BEFORE: Mr. Justice Chalmers
COUNSEL: Z. Bergman, for the Applicant
HEARD: In writing
ENDORSEMENT
1By endorsement dated January 9, 2021, I adjourned this Application seeking court approval of the proposed settlement of Yebit Lim’s tort claim, for 20 days to allow the Applicant to deliver additional material. On January 28, 2021, I received updated photographs showing the area of injury to Yebit’s face. I also received a copy of the retainer agreement and the dockets/accounts of the Applicant’s solicitor.
2On May 31, 2019, Yebit was bit on the face by the dog owned by the Respondents. According to the hospital records he had a 1.5 x 0.8 cm laceration on his right cheek. He had 3 lacerations to his right eyebrow. The Applicant provided a photograph of Yebit’s face which was taken on May 28, 2020. There is no apparent mark on Yebit’s face where he was bit by the dog. Yebit’s mother, Hyun Jin Cho is his Litigation Guardian. Counsel, Zev Bergman and Ms. Cho swore affidavits in which they stated that Yebit has experienced improvement and required limited medical care. There is no evidence of any emotional issues. Fortunately, Yebit made a good recovery from the dog bite. I am satisfied that the amount of the settlement is fair and reasonable in the circumstances.
3Ms. Cho retained Zev Bergman at Diamond and Diamond Lawyers LLP to pursue a tort claim on behalf of Yebit. On June 21, 2019, she entered into a retainer agreement with the firm which included a contingency fee arrangement. She agreed to pay 33% of the total damages from settlement or judgment to the firm for legal services rendered plus HST. The contingency fee/retainer agreement provides that the fee is based on all amounts recovered for claims. The fee is not calculated on the amount received in settlement for the disbursements.
4The retainer/contingency fee agreement is not binding on the party under disability. Contingency fee agreements are subject to careful scrutiny by courts. Only the court is entitled to determine whether the contingency fee agreement is fair and reasonable as between the parties: Jorisch v. Toronto Catholic School Board, 2017 ONSC 784, at para. 48. In determining whether the agreement is fair and reasonable, the court is to follow a two-step process. First, the fairness of the agreement is assessed as of the date it was entered into. The second step is to determine the reasonableness of the agreement as of the date of the hearing: Henricks-Hunter v. 81488 Ontario Inc. (Phoenix Concert Theatre), 2012 ONCA 496 at para. 20. The onus is on the solicitor to establish that the agreement is fair and reasonable.
5In determining whether the agreement is fair, the court must review the circumstances surrounding the making of the agreement. The contingency fee agreed upon was 33%. Ms. Cho was able to fully understand and appreciate the agreement. I am of the view that the contingency fee agreement was fair at the time it was entered into.
6In determining the reasonableness of the agreement at the time of the hearing, the court may consider the following:
a) The time expended by the lawyer;
b) The legal complexity of the matter at issue;
c) The results achieved; and
d) The risk assumed by the lawyer: Henricks-Hunter v. 81488 Ontario Inc. (Phoenix Concert Theatre), at para. 50; and Khokhar v. Aviva Insurance Company, 2020 ONSC 2464, at para. 46.
7On June 3, 2020, the parties reached an agreement to settle the claim on a full and final basis for $155,000, all inclusive. The Applicant’s solicitor agreed to reduce the contingency fee from 33% to 25% of the all-inclusive settlement less the OHIP claim and disbursements. The proposed fee is in the amount of $37,601.68 plus HST and disbursements. Zev Bergman was called to the bar in 2007. His hourly rate is $700.00. Assisting him was Simon Mariani who was called to the bar in 2014. His hourly rate is $550.00. Also assisting was Hayden Cantor who was called to the bar in 2020. His hourly rate was $150.00 as an articling student and was $250.00 after he was called to the bar. In addition, Kellie Pearce, a law clerk and Michah Ryu, an articling student assisted with the file. The value of the docketed time is $14,803.75. The proposed counsel fee is $37,601.68. This represents a premium of $22,797.93.
8The legal issues involved in this matter were not overly complex. There was no significant issue of liability given the fact that the dog owners are strictly liable to the Applicant. The only injury was the dog bite. There was no issue with respect to causation. Counsel for the Applicant notes that the proposed settlement was reached after protracted negotiations.
9I am satisfied that the lawyer achieved a good result for his client. The settlement was in the amount of $155,000 all-inclusive. After deduction of the proposed fee, Yebit will receive $107,916.84.
10With respect to the risk assumed, counsel argues that he was required to carry the disbursements and would not recover the payment of the disbursements or the time incurred in prosecuting the action if unsuccessful. I acknowledge that every matter subject to litigation is accompanied by risk. I am of the view that in this case, however the risk was not significant. Yebit was bit by the Respondents’ dog. There was no issue of causation. As a result, the issue was not whether the Applicant would be successful in recovering damages, but the amount of the damages.
11The objective of providing access to justice for injured persons, including persons under disability is an additional factor which is to be considered when assessing the reasonableness of the fee: Cogan, Re (2007), 2007 CanLII 50281 (ON SC), 88 O.R. (3d) 38 (Ont. S.C.J.). Here, counsel states that his firm agreed to represent the minor Applicant and to fund the action at the firm’s sole expense. Counsel argues that the achievement of the social objective of providing access to justice for injured parties is an important feature in determining the reasonableness of fees payable to solicitors on the settlement of the claims of persons under a disability: Adler, by his Litigation Guardian, Adler. v. State Farm Mutual Automobile Insurance Company, 2008 CanLII 32809 (ON SC), at para. 43. The goal of providing access to justice must be considered in light of the other factors. Particularly risky and contentious matters may require a higher contingency fee to achieve access to justice than matters in which the plaintiff sustained significant injuries and liability is not seriously in dispute. Here, the case was not particularly risky or contentious and counsel agreed to lower the contingency fee from 33% to 25%.
12After reviewing the factors set out above, I am of the view that the proposed fee is fair and reasonable. I take particular note of the fact that the contingency fee promotes the social objective of providing access to justice. I also note that counsel achieved a very good result for his client and agreed to reduce the contingency fee from 33% to 25%.
13I approve the proposed settlement. Pursuant to R. 7.09, the money payable to Yebit is to be paid into court unless the court orders otherwise. In the draft Judgment filed with this Application, it is proposed that the payment be made to the Litigation Guardian in trust for the benefit of Yebit, subject to further order of the Court. No reasons have been provided as to why I should make an order that the funds be paid to the Litigation Guardian instead of into court. If there are valid reasons for the payment to be made to the Litigation Guardian as opposed to being paid into court, counsel is to file further material within 7 days of the date of this endorsement. Otherwise I will amend paragraph 1(a)(i) of the draft Judgment to provide that the amount of $107,916.84 shall be disbursed to the Accountant of the Ontario Superior Court of Justice, to be held for the benefit of Yebit Lim who was born on February 15, 2011 and currently resides with his mother, Hyun Jin Cho, at 250 Heath Street West, Toronto, Ontario M5P 3L4 until his 18th birthday at which time the principal and interest shall be paid to him, subject to any order the Superior Court of Justice may make in the meantime.
DATE: FEBRUARY 1, 2021