The Estate of Mahandeep Gakhal et al. v. Khan et al.

DATE: 2022-06-02

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: THE ESTATE OF MAHANDEEP GAKHAL, KAMALJIT GAKHAL, PRABHKARAN GAKHAL, THE ESTATE OF SARWAN GAKHAL, LOVELEEN SANDAHAWALIA and GURLEEN GAKHAL, Minor by her Litigation Guardian, KAMALJIT GAKHAL Plaintiffs

AND:

MOHAMED K. KHAN, A-TEAM TRUCKING LTD., CHETKARAN S. GAKHAL, 3960285 CANADA INC. JAYESH B. SOLANKY, TRAVELLERS INSURANCE COMPANY OF CANADA, and AVIVA GENERAL INSURANCE COMPANY OF CANADA Defendants

BEFORE: J. WILSON J.

COUNSEL: Ryan Naimark for the Plaintiff

HEARD: In Writing

ENDORSEMENT

[1] This is an ex parte motion brought pursuant to Rule 7.08 of Rules of Civil Procedure to approve the proposed infant settlement and to approve Contingency Agreement to pay 30% of the recovery in the tort claim as legal fees.

[2] The proposed recovery to the Plaintiff for the loss of her father is $77,500.00 plus costs and disbursements including HST resulting in an overall settlement figure of $92,548.78. The law firm proposes that legal fees be payable in the amount of $22,475.00 representing 29% of the settlement, plus HST and disbursements in the amount of $2,912.53

[3] This was yet another case of having to dig to get information for me to fairly assess the appropriateness of the settlement proposed and the fees. Even now, after delays and exchanges of information the facts are not all clearly before me.

[4] To guide counsel in the future, and to ensure that matters submitted for consideration of the court are complete I include a copy of my standard letter that I have developed to ensure that counsel provide me with the materials I need to make an informed decision that is fair to both the client and to counsel:

SUPERIOR COURT OF JUSTICE

Court House 361 University Avenue TORONTO, ONTARIO M5G 1T3 Tel: (416) 327-5284 Fax: (416) 327-5417

Dear Counsel,

Re: Style and Court File Number

Your file has been assigned to Justice Janet Wilson to review the status of a proposed settlement for the infant / person under disability pursuant to rule 7.08 of the Rules of Civil Procedure.

Before reviewing your file, Her Honour requires you to ensure that all the required material is uploaded to CaseLines with the Index and Affidavit hyperlinked within the next 15 days.

This letter has been prepared to avoid the necessity of delays and various back and forth communication if the materials filed are deficient. Ensuring that the materials include the following will enhance fairness to both the Plaintiff and counsel alike.

The following must be included in your materials:

1. Affidavit of counsel – exhibits including all of the relevant expert reports to be indicated but filed at the end of the affidavit and hyperlinked (see below). The Affidavit of counsel and associated exhibits should include the following:

a. A description of the accident.

b. The Plaintiff’s background – age, education, lifestyle, work history (if a person under disability), etc.

c. An outline of the Plaintiff’s injuries and issues initially and currently, with pertinent excerpts from expert reports filed as exhibits (please note it is generally not necessary to file hospital records). It is important to include the treatment records of family doctors, as well as any treating doctors, as well as the Rule 53 or accident benefits experts. The full expert reports should be filed as per instructions below.

d. An outline of the circumstances when the contingency agreement was signed confirming the fairness of the agreement at time it was signed.

e. An outline of the steps taken in the proceeding.

f. An outline of the proposed substantive settlement (including settlements of other parties if applicable) and an outline of the proposed fees and disbursements to be charged to the Plaintiff and if applicable to other co-Plaintiffs.

g. An outline from the solicitor why he or she is recommending the settlement as fair and reasonable in the present circumstances. Counsel should refer to issues in the case including questions of liability and likely outcomes and ranges of damages.

h. If a structured settlement is being considered, what options were canvassed and why was the structure chosen. Please illustrate how the suggested structured settlement meets the Plaintiff’s future needs.

i. It is not appropriate to simply recommend that the capital sums be paid into court. For a minor I will now approve a capital payout at age 18. The litigation guardian needs to set up a separate trust account, with periodic accounting, to access capital funds for the Plaintiff’s needs, with a proposed plan. Generally, I approve access to these funds for the purpose of education, programs or treatment. For a minor any remaining capital should not be paid out until age 25.

j. Information and status of the companion action – i.e., tort or accident benefits claim as well as copies of any prior order made and breakdown of any settlement in the companion action.

k. Copies of all dockets to be filed for both tort and accident benefits claim and a list of all disbursements.

l. Disclosure of fees and disbursements paid in any companion action as well as summary of time docketed, and fees or disbursements already paid in the matter before the court.

m. Copy of any retainer agreement.

n. An outline from the solicitor why he or she submits that the proposed fee is reasonable and fair having regard to the applicable factors including risk assumed, degree of difficulty of the case, stage when proceeding resolved, time spent, result, and any other factors that the solicitor views as relevant.

2. Affidavit of the Litigation Guardian with exhibits to be indicated but filed separately at the end of the affidavits hyperlinked (see below). The Affidavit of the Litigation Guardian and associated exhibits should include the following:

a. Description of the Plaintiff’s present circumstances.

b. Description of the Litigation Guardian’s relationship to the Plaintiff and his or her background (age, education, etc.)

c. The Litigation Guardian’s views on the proposed settlement and proposed fees requested by counsel referring to the elements of the two-part test that the solicitor must meet of reasonableness and fairness at the time any contingency agreement is signed, as well as at the time the quantum of fees is considered.

d. A confirmation that the affiant understands that just because a contingency fee agreement has been signed, that it is not determinative of the fees to be charged.

e. An up-to-date and clear management plan for the infant or person under disability and explanation of how the proposed settlement fulfills the management plan.

f. In complex cases a case manager should provide a management plan and ongoing case management services with a budget illustrating that the Plaintiff’s needs will be met by the proposed settlement, and that appropriate supervision will be provided.

g. Structured settlements should be considered and any quotations received should be provided as an exhibit. If a structured settlement is being considered, what options were canvassed and why was the structure chosen. Please illustrate how the suggested structured settlement meets the Plaintiff’s present and future needs.

h. It is not appropriate to simply recommend that the capital sums be paid into court. For a minor I will not approve a capital payout at age 18. The litigation guardian needs to set up a separate trust account, with periodic accounting, to access capital funds for the Plaintiff’s needs, with a proposed plan. Generally, I approve access to these funds for the purpose of education, programs or treatment. For a minor any remaining capital should not be paid out until age 25.

i. The affiant needs to understand his or her duties to the Plaintiff, and that the funds must be held in a separate trust account, subject to an accounting to the court if the settlement funds are not structured.

The exhibits attached to each Affidavit are to be organized separately for ease of access with an index, including hyperlinks and pages within each tab numbered.

Please upload the requested information to CaseLines within 15 days and confirm when the materials have been uploaded, to allow this matter to be dealt with promptly and efficiently.

Yours very truly,

[5] Counsel seeks the above noted approval of a settlement for the infant child Gurleen who was 11 years old at the time of the motor vehicle accident in 2017. Her father died as a consequence of the accident some time after the accident in 2018. She suffered a variety of psychological problems and did receive some counselling. There is very little information in the file about how Gurleen is doing now and the effect of the loss of a father on her life.

[6] Buried in the materials in an exchange of correspondence is the fact that the global settlement for 4 plaintiffs was in the total amount of $419,439.20.

[7] I located the breakdown of the settlement in the materials. The wife is to receive $208,561.11 including costs, the son $65,993,78 including costs, and the sister a surprising $52,335.53.

[8] There is no breakdown of the proposed settlement and no explanation why Gurleen, the infant daughter of the deceased, only 11 years old at the time of the accident did not receive at least an equal one quarter share of the settlement proceeds. The other plaintiffs are paying costs based upon a contingency agreement in the amount of 29% of the recovery.

[9] In the supplementary materials filed producing some time dockets a total of 143 hours have been docketed on the file for all of the four plaintiffs. Plaintiffs’ counsel will be amply paid well in excess of time spent based upon the contingency agreement with the adult plaintiffs.

[10] The settlement is not remarkable, but I am prepared to approve it as the Plaintiff and her family have been through a lot.

[11] Counsel has produced the actual docket entries that they have allocated to this plaintiff only. The firm has purported to divide the dockets in 4 as there were 4 Plaintiffs as justification of the account. In those docket entries counsel allocates 25% of all time expended on the file to the minor, such as discovery. I note that the child did not participate in the discovery. The firm has also docketed time in excess of $5,750.00 plus disbursements for preparation of the material to approve the settlement. In spite of the heavy dockets, the materials were still deficient.

[12] A contingency agreement may be enforced as against a party under disability only if the evidence establishes that the agreement was fair at the time it was made, and that the fees are reasonable under the circumstances at the time the question of costs is addressed. The onus is upon the solicitor to provide proof that the dual test is met: Henricks-Hunter v. 814888 Ontario Inc. (Phoenix Concert Theatre), 2012 ONCA 496, 294 O.A.C. 333, at paras. 17, 20, 22.

Question 1: Does the Evidence Establish that the Agreement was Fair at the Time It Was Made on July 19, 2019?

[13] I have no evidence to the contrary or concerns that the agreement was reasonable at the time it was filed. The solicitor has met this first onus.

Question 2: Are the Proposed Fees Reasonable as of This Date When I Consider the Question of Costs?

[14] Counsel for the Plaintiff seeks payment in the amount of $22,475.00 plus HST and disbursements relying on the 30% contingency agreement signed by the Plaintiff. The proposed fee is 29.2% of the tort damages proposed settlement.

[15] In determining the reasonableness of a contingency fee arrangement and the proposed fee to be charged, the factors to consider as outlined in Henricks-Hunter, at paras. 17, 20, 22, are:

• The results achieved

• The time expended on the file

• The complexity of the case

• The risk assumed by the solicitor in accepting the file

[16] The results achieved for this 11-year-old girl for the loss of her father are modest. The time expended on the file has been divided in 4 ways, when this Plaintiff did not receive 25% of the total settlement. The file is of medium complexity. There was no risk to the counsel assuming this fatality file when there was no viable issue as to liability.

[17] In these circumstances I fix costs that are reasonable to the Plaintiff and to counsel in the amount of $17,000 plus HST of 2,210, and disbursement as requested in the amount of $2,912.78, for a total of $22,122.53 for fees and disbursements in this modest case.

Use of the funds

[18] Counsel suggested that the funds be paid into court and paid out to the Plaintiff when she turns 18. Respectfully this is an irresponsible suggestion. No 18-year-old should be given a capital amount of money, unless it is for a specific purpose such as education.

[19] The Plaintiff may need access to these funds now, until she reaches the age of majority, and the funds should be available for treatment, programs or education in her best interests.

[20] The balance of the funds in the amount of $70,426.25 shall be set up in a separate trust account in trust for the Plaintiff to be used only for her treatment, education and activities that are not available through other funding until age 25.

[21] If there is a balance left of these funds at age 25 these would be payable to the Plaintiff at that time. These funds are only for the Plaintiff and are not to be used for any other family purpose.

J. Wilson J.

Date: June 2, 2022