Court File and Parties
COURT FILE NO.: FS-20-105-00S DATE: 2022 02 24 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Virginia Mary Pyke, Applicant AND: Barry Logan, Respondent
BEFORE: Doi J.
COUNSEL: Ravi Sawhney, for the Moving Respondent Clarissa D’Avella, for the Applicant
HEARD: February 17, 2022
Endorsement
Overview
[1] On this motion, the Respondent is seeking to remove Ms. D’Avella and her law firm from acting as counsel for the Applicant at a focussed hearing to address the validity of a separation agreement. The Respondent claims that the removal is necessary due to a conflict of interest arising from the Applicant’s intention to call her previous counsel, Ms. Cebulak, as a witness at the hearing. Both Ms. D’Avella and Ms. Cebulak practice at the same law firm.
[2] For the reasons that follow, I find that the Respondent’s motion should be dismissed.
Background
[3] The Respondent is seeking to set aside the parties’ separation agreement dated January 26, 2017 (the “Separation Agreement”). The Applicant is seeking to enforce its terms.
[4] The underlying dispute regarding the Separation Agreement centres on whether there was sufficient financial disclosure before the agreement was executed, whether the agreement was formally witnessed, and whether the agreement should be vitiated due to duress or undue influence, among other things.
[5] The Applicant’s former counsel of record, Ms. Cebulak, prepared a draft version of the Settlement Agreement which the parties signed on January 26, 2017. Ms. Cebulak was not present when the terms of the agreement were negotiated as the parties conducted their own negotiations between themselves without counsel. Ms. Cebulak’s only involvement with the Respondent was seeing him at two case conferences which she attended as the Applicant’s counsel.
[6] Around March 2, 2021, the Applicant delivered a notice of change in representation and became a self-represented litigant in this proceeding. On May 31, 2021, Ms. Cebulak advised Respondent’s counsel, Mr. Sawhney, that she would be the Applicant’s agent at an upcoming case conference on June 25, 2021.
[7] At the June 25, 2021 case conference, a two (2) day focussed hearing was scheduled to start the week of February 14, 2022 to address whether the Separation Agreement is valid and enforceable. During the conference, Ms. Cebulak advised that she would be a witness for the Applicant and not act as her counsel at the focussed hearing. Although the Respondent apparently raised a concern with Ms. Cebulak’s impending role as a witness, it seems that he was not granted leave at the conference to bring a motion to have Applicant’s counsel removed before the hearing.
[8] Thereafter, the Applicant remained a self-represented litigant but engaged Ms. D’Avella as her agent for the focussed hearing.
[9] On February 16, 2022, the focussed hearing came before me. At the outset of the hearing, the Respondent objected to Ms. D’Avella acting for the Applicant due to a conflict of interest from Ms. Cebulak’s anticipated testimony. When asked, the Respondent could not recall whether a notice of motion for the objection had previously been delivered. The Respondent also late-served a factum for his objection the day prior. In the circumstances, I directed the Respondent to deliver a notice of motion to confirm the nature of the objection and adjourned the hearing to the next day to allow the Applicant some time to consider the objection and prepare a response.
[10] Further to my direction, the Respondent served and filed a notice of motion on February 16, 2022 to have Applicant’s counsel removed. The following day, he also filed a notice of motion dated September 30, 2021 that, among other things, sought the removal of Ms. Cebulak and her firm as the Applicant’s counsel. According to the Respondent, the September 30, 2021 notice of motion had been served in anticipation of the motion being argued at the return of the hearing in February 2022. However, the court has no record of the notice of motion dated September 30, 2021 being filed until February 17, 2022 when the Respondent e-filed a copy with proof of service.
Legal Principles
[11] The court’s inherent jurisdiction to remove counsel for a conflict of interest stems from its supervisory jurisdiction to safeguard the proper administration of justice: MacDonald Estate v. Martin, [1990] 3 SCR 1235 at 1263; Talisman Resort v. Keyser, Usling et al., 2013 ONSC 1901 at para 13, citing Puhl v. Katz Group Canada Ltd, [2006] OJ No 4596 (SCJ) at para 23.
[12] On a motion to remove counsel for a conflict of interest, the moving party must show on a balance of probabilities that a fair-minded and reasonably informed member of the public would conclude that the removal of counsel is necessary for the proper administration of justice: MacDonald Estate at p. 1263; Talisman at paras. 14 and 49.
[13] The difficulties that can arise from a lawyer serving as counsel to a party in a proceeding and also appearing as a witness were set out by Gillese J. (as she then was) in Urquhart v. Allen Estate, [1999] OJ No 4816 (SCJ) at paras 27 and 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 plaintiff’s 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. The dual roles that [counsel] intends to fulfill compromises the integrity of the system. As I can see no way to alter the process that respects the rights of both parties, fulfills the needs for due process and maintains regard for the dictates of the proper administration of justice, in these circumstances plaintiffs’ counsel cannot be permitted to continue. I note that even if I were to exercise my discretion and permit him to continue, procedural problems may very well arise. If they did so, it is likely that it would require me to abort the trial at that time. Such a course of events would result in more prejudice to the plaintiff than does dealing with the issue now. [Emphasis added]
[14] A lawyer is not absolutely prohibited from acting as counsel for a client when another lawyer in the same firm is a witness in the case. On this point, O’Brien J. writing for the Divisional Court in Essa (Township) v. Guergis (1993), 15 OR (3d) 573 (Div Ct) at para 45 stated:
I do not accept the argument that when a lawyer is compelled to testify against the “other” side in a lawsuit the lawyer’s firm must always be prevented from acting in the lawsuit. There are a variety of scenarios which might develop at, or during, trial.
… In the course of litigation an honest witness is often compelled to give evidence which will assist a party that witness feels is “opposite”. I do not agree that such a possible conflict requires removal in all cases. There may be some where it does. I am not persuaded that decision should be made at this pre-trial stage of the proceedings in this case. [Emphasis added]
[15] O’Brien J. further held in Essa at para 48 that the court should take a flexible approach on an application to remove counsel for a conflict of interest and decide each case on its own merits by considering several factors, including:
a. The stage of the proceedings; b. The likelihood that the witness will be called; c. The good faith (or otherwise) of the party making the application; d. The significance of the evidence to be led; e. The impact of removing counsel on the party’s right to be represented by counsel of choice; f. Whether the trial is by judge or jury; g. The likelihood of a real conflict arising or that the evidence will be “tainted”; h. Who will call the witness if, for example, there is a probability counsel will be in a position to cross-examine a favourable witness, which may require the trial judge to prevent that unfair advantage from arising; and i. The connection or relationship between counsel, the prospective witness and the parties involved in the litigation.
[16] In considering the Essa factors, the court should endeavour to balance the need to maintain the high standards of the legal profession and the integrity of our justice system with the principle that a litigant has a right to choose its counsel which should not be interfered with lightly: MacDonald Estate at p. 1243 and 1270; Talisman at para. 15. In this regard, the most important factor is to preserve the integrity of our system of justice: MacDonald Estate at p. 1265; Puhl at paras. 19-20. In addition, the court should consider not only whether there is an actual conflict of interest but also whether a conflict of interest could be reasonably perceived in all of the circumstances: MacDonald Estate at p. 1258; Puhl at para. 18; Talisman at para. 16.
[17] On a removal motion such as this, the court may consider applicable rules of professional conduct, which are not binding but are persuasive as an important statement of public policy: MacDonald Estate at p. 1244; Urquhart at para. 16. Nothing in the Law Society of Ontario’s Rules of Professional Conduct prohibits a lawyer from acting as counsel for a client when another lawyer in the same firm is a witness in the matter. What is generally prohibited is a lawyer as advocate also testifying before a court or tribunal, with some exceptions: Urquhart at para. 15; Talisman at para. 18; Rule 5.2-1 of the Rules of Professional Conduct. [^1] In Ontario, there is no jurisprudential authority for the proposition that a lawyer who appears as an advocate before a court or tribunal is precluded from tendering evidence from a law partner or associate, whether by affidavit or oral evidence. Instead, as set out above, the matter is discretionary and calls for a flexible approach on a case-by-case basis: Essa at para. 48; Talisman at para. 21.
Analysis
[18] Having regard to the Essa factors, I am not persuaded that the Respondent has shown that the removal of Ms. D’Avella and her law firm as counsel for the Applicant is necessary for the proper administration of justice.
[19] Despite some ambiguity in the record, I accept that the Respondent raised his concern with Applicant’s counsel at the June 25, 2021 case conference and later served a notice of motion dated September 30, 2021 for Ms. Cebulak and her law firm to be removed as Applicant’s counsel. Accordingly, I am satisfied that the Applicant had notice of the Respondent’s intention to object to her counsel at the focussed hearing. As the Respondent apparently did not obtain leave to bring a removal motion before the focussed hearing, I am satisfied that it was not improper for him to raise his objection at this stage of the proceeding. In addition, I accept that Ms. D’Avella has a degree of familiarity with this case because she prepared to argue the focussed hearing.
[20] It is clear from the record that the Applicant intends to call Ms. Cebulak as a witness at the focussed hearing. However, this is simply one of several factors for the court to consider and does not necessarily favour the removal of counsel without more: Teltscher v. PTC Accounting, 2006 ONSC 29284 at para 13; Talisman at para 34.
[21] I am not persuaded that the Respondent acted in bad faith by objecting to Applicant’s counsel. As a general proposition, I accept that a party seeking to remove opposing counsel for a conflict of interest should pursue this relief promptly after the conflict is identified and ideally before the return of a contested hearing on the merits to avoid others incurring unnecessary preparation time and costs: Talisman at para. 35. Despite some delay in seeking the removal, the Respondent conferenced the conflict issue, served a notice of motion for the removal, and raised his objection to Applicant’s counsel at the focussed hearing as leave to bring a motion beforehand was not granted. In view of this, I see no basis to find that the Respondent acted improperly.
[22] In my view, the nature of Ms. Cebulak’s evidence leans in favour of dismissing the motion. From the evidentiary record, it seems unlikely that her evidence will be overly controversial. On this type of motion, I accept that the court should not inquire too far into the significance of the anticipated evidence as it relates to the dispute: Yellow Cedar v. Di Torio, 2020 ONSC 5915 at para. 39. That being said, Ms. Cebulak’s will-say statement indicates that her anticipated evidence will address her work to prepare and finalize drafts of the Separation Agreement, and explain the chronology of events that unfolded. Her evidence is not expected to address her advice or other privileged matters as the Applicant is not waiving solicitor-client privilege. In addition, as stated earlier, Ms. Cebulak was not involved in the parties’ negotiations leading up to the executed Separation Agreement which further limits the scope of her anticipated evidence. Taking this all into account, I accept that Ms. Cebulak’s evidence will likely not be overly controversial to the central issues going to the validity of the Separation Agreement. In light of this, I am not persuaded that the Respondent has shown a real basis to believe that Ms. Cebulak will likely, or probably, give material evidence that implicates a conflict to justify Applicant’s counsel and law firm being removed from the case: Ontario Realty Corp. v. P. Gabriele & Sons Ltd., [2006] OJ No 4497 (SCJ) at para. 34; Graham v. Ontario (2006), 26 CPC (6th) 238 (SCJ) at para. 35.
[23] The jurisprudence is clear that a party’s choice of counsel is a significant factor and should not be interfered with lightly: MacDonald Estate at p. 1243 and 1270; Talisman at para. 15; Yellow Cedar at para. 40. The courts in Canada exercise the highest level of restraint before interfering with a party’s choice of counsel: Kaiser (Re), [2011] OJ No. 6223 (CA) at para. 21. In this case, the Applicant has built some continuity with her counsel and firm, albeit through limited retainers for specific matters which is an increasingly common way that family law litigants are engaging counsel. Having prepared for the focussed hearing, Ms. D’Avella is now familiar with the case and could put her knowledge and preparations to good use at the hearing.
[24] The focussed hearing will be heard by a judge. In the circumstances, I am persuaded that this factor favours dismissing the motion as any prejudice that may arise from having lawyers from the same law firm as counsel and a witness can be lessened by the judge’s ability to separate and manage the issues in a way that is fair to both parties: Yellow Cedar at para. 42.
[25] In my view, Ms. Cebulak’s evidence is unlikely to be more or less tainted regardless of whether the Applicant is represented by Ms. D’Avella or new counsel. Ms. Cebulak’s evidence is not expected to be overly controversial. She had no direct involvement in the parties’ negotiations before the Separation Agreement was executed, and she is not expected to disclose any advice as the Applicant does not intend to waive solicitor-client privilege. As a result, I am satisfied that the potential for a real conflict of interest or tainting of her evidence is remote given the limited nature of her anticipated testimony.
[26] Ms. Cebulak will be called as a witness by the Applicant who has undertaken to not cross-examine her to remove any unfair advantages associated with that mode of questioning, which is a significant mitigating factor: Yellow Cedar at para. 44. It follows that any unfairness is unlikely to arise from the Applicant’s questioning of her. Nevertheless, while having counsel question another lawyer from the same firm in direct examination is preferable to having the same questioning occur in cross-examination, I accept that adducing evidence this way is not ideal: Talisman at para. 39.
[27] The last Essa factor is the relationship between Ms. D’Avella, Ms. Cebulak and the parties in the litigation. Emphasizing this factor, the Respondent submits that the removal of Applicant’s counsel and her firm is necessary to ensure the proper administration of justice given the actual or perceived conflict of interest or tainting by having Applicant’s counsel call her client’s former counsel, who is another lawyer at the same law firm, to testify as her witness at the focussed hearing. The Respondent asserts that Ms. Cebulak is too closely connected to the Applicant, which raises a conflict between her loyalty to her former client and her obligation to the court to give fair and proper evidence. This factor must be weighed along with the others in determining the motion.
[28] Having regard to the entire evidentiary record and all of the relevant factors set out above, I have no difficulty finding that a fair-minded and reasonably informed member of the public would not believe that the proper administration of justice requires the removal of Ms. D’Avella and her law firm. As set out earlier, Ms. Cebulak’s evidence is unlikely to be overly controversial. In my view, the potential for an actual conflict to impact or taint her evidence seems fairly low given the limited nature and scope of her evidence, the measures proposed by the Applicant to mitigate the concerns, the trial judge’s ability to manage the hearing in a way that is fair to both parties, and the nature of the Respondent’s concern that is based heavily on perceptions. Taking this all into account, I find that the potential for Ms. Cebulak’s testimony to implicate the sort of mischief that would justify removing Applicant’s counsel is remote, and certainly not likely. The Applicant’s choice of counsel is a significant consideration on this motion. The courts are slow to interfere with a litigant’s right to choose their own counsel: Kaiser at para. 21. Depriving a litigant of the lawyer of their choice will impose hardship that is only justified if the imposition avoids a more serious injustice: Urquhart at para 19. Removing counsel should only be ordered to relieve the risk of real mischief and not a mere perception of mischief: Ibid; Chapman et al. v. 3M Canada Inc. et al., [1995] OJ No 2628 (Gen Div) at para. 19. Ultimately, after balancing all of the relevant factors, I am confident that a reasonably informed member of the public would share my view that a removal of the Applicant’s counsel of choice is not justified in the particular circumstances of this case.
Outcome
[29] Accordingly, the motion is dismissed. Ms. D’Avella and her law firm may continue to act for the Applicant.
[30] If the parties are unable resolve the issue of costs for this motion, the Applicant may deliver written costs submissions of up to 2 pages (excluding her costs outline or any offer(s) to settle) within 20 days, and the Respondent may deliver responding submissions on the same terms within a further 20 days. Reply submissions may not be delivered without leave.
[31] The parties shall promptly contact the trial office to reschedule the focussed hearing, which may proceed before any available judge.
Doi J. Date: February 24, 2022
[^1]: Rule 5.2-1 of the Law Society of Ontario’s Rules of Professional Conduct largely mirrors the corresponding guidance found at Rule 5.2-1 of the Federation of Law Societies of Canada’s Model Code of Professional Conduct.