Court File and Parties
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: D’SHAY KNIGHTS-WRIGHT, a minor under the age of 18 years by His Litigation Guardian, INGRID NATALIE KNIGHTS and INGRID NATALIE KNIGHTS, in her personal capacity, Plaintiffs
AND:
110 PARKWAY FOREST DRIVE LIMITED, TIMBERCREEK PROPERTY SERVICES INC. (operating as Timbercreek Communities) and JOHN DOE CONTRACTOR, Defendants
BEFORE: Justice A.P. Ramsay
COUNSEL: Tina D. Radimisis for the Plaintiffs
HEARD: In Writing
ENDORSEMENT
1The plaintiffs bring this motion in writing under r. 37.12.1(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for court approval of the settlement of the claims of the minor plaintiff, D’Shay Knights-Wright (the “minor plaintiff”), pursuant to r. 7.08 of the Rules of Civil Procedure. The plaintiffs also seek an order dispensing with service of the Notice of Motion on the Children’s Lawyer under r. 7.08 of the Rules of Civil Procedure, and approval of the legal fees of Jewell Radimisis Jorge LLP (JRJ).
2On December 26, 2017, the minor plaintiff was playing with a friend in a parking garage when he slipped on ice and fractured his left tibia. He was thirteen and in grade seven at the time of the incident; he is now seventeen years old.
3To decide whether the settlement was fair and reasonable and determine whether the contingency fee agreement should be approved, I requested additional information from counsel. The supplementary materials include an opinion from a physician on the minor plaintiff’s status and prognosis, evidence regarding his performance in school, information on liability and the lawyer’s assessment, and the recommendations of the in-home assessment. A consent by the minor plaintiff, who is over sixteen, has also now been filed in accordance with r. 7.08(4).
The Settlement
4The court was initially asked to approve a lump sum settlement of $110,000 inclusive of prejudgment interest, OHIP subrogated interest, disbursements, and costs. A breakdown of the heads of damages was requested. The lack of a breakdown precluded the court from determining whether the amounts for the various heads of damages, net of liability, were fair and reasonable. It was also not clear if OHIP’s subrogated interest was reduced, correspondingly, by any apportionment of liability on account of the contributory negligence of the minor plaintiff.
5The supplementary material provides the breakdown of the settlement as follows:
General Damages inclusive of interest $60,000.00
Special Damages (housekeeping/attendant care) $27,942.20
Loss of Competitive Advantage $0.00
OHIP’s Subrogated Interest $1,787.47
FLA NIL
Total Damages $89,729.67
Disbursements $5,061.15
Legal fees $15,209.18
$110,000.00
6Ms. Radimisis deposes that the net recovery to be approved on behalf of the minor plaintiff would be $72,733.02 after considering OHIP’s subrogated interest and the legal fees of JRJ in the amount of $30,418.36.
7For the reasons below, I have approved the settlement of $110,000.00, but have not approved the Contingency Fee Agreement. Rather, I have determined the legal fees based on what is fair and reasonable in the circumstances.
Liability
8The plaintiffs commenced this action against the defendants, 110 Parkway Forest Drive Limited, Timbercreek Properties Services Inc. (operating as Timbercreek Communities), and John Doe Contractors on the basis that the defendants breached their duty imposed by s. 3(1) of the Occupier’s Liability Act, R.S.O. 1990, c. O.2, “to take such care as in all the circumstances of the case is reasonable to see that persons entering on the premises, and the persons brought on the premises by those persons are reasonably safe while on the premises”. The plaintiffs maintain that snow and/or ice had accumulated on the defendants’ premises and presented a danger to all patrons entering and exiting the premises.
9There is no evidence before me as to any system of maintenance carried out by any of the defendants. Whether or not the defendants took steps to ensure that the premises were reasonably safe will be assessed in all the circumstances of the case: Kerr v. Loblaws Inc., 2007 ONCA 371, 224 O.A.C. 56, at para. 28.
10Counsel suggests that the defence available under s. 4(1) of the Occupier’s Liability Act may be available to the defendants. I do not agree. Section 4(1) of the Act governs situations where the risks are known to the plaintiff and willingly assumed by the plaintiff.
11From the photos in evidence, the incident occurred in the vicinity of a building and close to a door. The lawyer deposes in her supplementary affidavit that the incident occurred “in a vestibule type uncovered pathway between the parking garage and the residential building”. The area was exposed to the elements. The incident occurred in the winter. The photos filed show ice and snow on the ground. The apartment building is visible as is a door and I am inferring from the photo evidence that patrons would enter and exit the building. On the evidence before me, this would be an area where there was pedestrian traffic including from the occupants of the building. There is no evidence before me to show the area posed an unusual danger which was made known to persons such as the plaintiff. There is no evidence that the area was off limits. The Supreme Court of Canada made it clear that s. 4(1) provides a narrow exception, and that it would be a rare case where a visitor would have full knowledge of and accept the risks of an occupier’s non-compliance with the statute.
12The Court stated in Waldick v. Malcolm, 1991 71 (SCC), [1991] 2 S.C.R. 456, at p. 479 that:
In my view, the Legislature’s intention in enacting s. 4(1) of the Act was to carve out a very narrow exception to the class of visitors to whom the occupier’s statutory duty of care is owed. This exception shares the same logical basis as the premise that underlies Volenti, i.e., “that no wrong is done to one who consents. By agreeing to assume the risk the plaintiff absolves the defendant of all responsibility for it”: per Wilson J. in Crocker [v. Sundance Northwest Resorts Ltd., 1988 45 (SCC), [1988] 1 S.C.R. 1186], at p. 1201. Rare may be the case where a visitor who enters on premises will fully know of and accept the risks resulting from the occupier’s non-compliance with the statute.
13As for the apportionment of any contributory negligence on the part of the plaintiff, at the time of the incident, the minor plaintiff was wearing running shoes which were well worn with no tread on much of the soles of his shoes as depicted in the photos. As the minor plaintiff was playing with his friend, he had been running. He slipped on some ice and when he landed, his left leg hit either a wall or a door.
14Counsel for the plaintiff has taken contributory negligence of 20% into account for the purpose of the settlement, which, in my view, is reasonable given the range is anywhere from 0% to 30%. While footwear is but one factor to be considered in determining whether there was contributory negligence on the part of the minor plaintiff, the court has previously noted that running shoes are not appropriate winter footwear: Bramer v. City of Hamilton, 2015 ONSC 713, at para. 89; Hawman v. Regina Exhibition Association Ltd., 1999 SKQB 123, 186 Sask. R. 225; Lear v. London (City), 1999 CarswellOnt. 2990. While the defendant’s position on liability is not known, I am satisfied that, on the evidence, the shoes of the minor plaintiff were not appropriate having regard to the worn or non-existent tread and the snow and ice on the ground. In my view, the fact that the minor plaintiff had also been running may be a factor in apportioning some degree of fault or negligence to him for the incident.
15An apportionment of 20% contributory negligence was reasonable in the circumstances.
Damages
16The minor plaintiff was a twelve-year-old grade seven student at the time of the fall in December 2017. He sustained a fracture to his left tibia. He appeared to have been a very active basketball player. The hospital records indicate: “pt was running in basement parking garage when he slipped on ice land on his buttocks and left leg struck wall. 0 LOC.” “Narrative indicate no headache no neuro deficits, no visual disturbances, no dizziness, no LOC, no pain radiating, no vomiting, no fever, no nausea, [and] no SOB”. There was no open wound and his injury was treated conservatively. He was placed in a cast, which was removed on January 23, 2018.
17The minor plaintiff had a brief course of rehabilitation. He returned to school a month after the fall. His treating orthopedic surgeon, Dr. Christopher Peskun (“Dr. Peskun”), discharged him in April 2018. Dr. Peskun noted at that time that the minor plaintiff was doing well and had a minimal limp. According to Dr. Peskun’s note: “[h]e is back doing some play, as well as some running and jumping.” At that same visit, Dr. Peskun noted that “he has very little residual symptomatology”.
18The supplementary materials also include a note from his family doctor, Dr. Naimer, dated February 22, 2022, which indicates that the minor plaintiff had recovered fully from his left tibial fracture. Dr. Naimer noted that he “has no ongoing impairments or injuries related to the incident and is living his life as he did prior to the injury.” The affidavit of the litigation guardian did not address the questions to be answered for the court, but rather, the evidence regarding whether the minor is still limping, how he is doing in school, and whether any further treatment was contemplated came from the lawyer’s affidavit. Such evidence ought to come from the litigation guardian. However, I am satisfied that I am able to decide whether the settlement is in the best interest of the minor plaintiff based on all of the evidence as a whole before me.
19An In-Home Assessment Care Needs Report completed by occupational therapist Varun Madan was commissioned by the plaintiffs in July 2019. Ms. Madan concluded that the minor plaintiff required time-limited attendant care and housekeeping assistance for approximately nine months. She noted that he was independent in his attendant care and housekeeping tasks thereafter. He required no further assistance or assistive devices. At the time of the assessment, the assessor noted that he “appeared cognitively oriented, aware and alert”. He had reportedly resumed participation in previously enjoyed activities. This dovetails with the evidence of his physician, which noted that the minor plaintiff has returned to his pre-injury recreational and sporting activities. The lawyer also deposes that the minor plaintiff will be going to college in the United States to play basketball.
20Counsel for the plaintiff has also now provided me with cases with a range of general damages awards between $40,000 and $60,000.00. I am satisfied that the amount of the settlement for general damages for a fractured tibia, without complication, in the amount of $60,000.00 inclusive of interest, is a very good result. While counsel did not provide what the gross amount would be, this figure appears to represent gross general damages of approximately $65,000.00, or $52,000.00 net of contributory negligence of twenty percent (20%), plus interest (approximately 15%) of $7,800.00.
21As noted above, housekeeping and attendant care services were time limited (less than one year), and in the result, the amount of $27,942.20 to settle the minor plaintiff’s miscellaneous special damages is a very good result. On the evidence before me, there are no out-of-pocket expenses. While I assume the amount allocated to the special damages is net of liability of 20% on account of contributory negligence ($34,940.00 gross), I have not attributed the amount to a past loss.
22As for any loss of income claim, while it would be appropriate for the litigation guardian to provide evidence as to how the minor plaintiff is doing in school, I am prepared to accept that he has resumed his schooling and is doing well and will be going to the United States to play basketball. I accept the evidence of his family doctor that the minor plaintiff has returned to his pre-accident activities, and therefore, on the evidence, it does not appear that he would have any potential income loss claim.
OHIP Subrogated Claim
23The Ministry of Health and Long-Term Care’s subrogated interest amounts to $2,533.53. Counsel has managed a reduction of 30% (10% more than the percentage of contributory negligence apportioned to the minor plaintiff) of OHIP’s subrogated interest which results in a net of $1,787.47, which is a good result.
24In my view the settlement is fair and reasonable and in the best interest of the minor plaintiff.
Legal Fees and Disbursements
25The litigation guardian signed a Contingency Fee Agreement on January 26, 2018 (“CFA”). Under the agreement, JRJ would recover 33% of any award for damages plus taxes. The lawyers are prepared to reduce their contingency fee to 30% of damages recovered, plus H.S.T., or $30,418.36.
26On a motion to approve a settlement on behalf of a person under disability, a contingency agreement has no force and effect unless approved by a judge: Marcoccia v. Gill, 2007 33 (Ont. S.C.); Sonny v. Sonnylal, 2007 6923 (Ont. S.C.); Rivera v. LeBond, 2007 7396 (Ont. S.C.).
27The Ontario Court of Appeal has noted that the court must carefully consider the relevant materials to assess the fairness and reasonableness of the proposed fees, and to ensure that the settlement, including provision for legal costs, is in the best interests of the person under disability for his or her benefit: Krukowski v. Aviva Insurance Company of Canada, 2020 ONCA 631 at para. 24.
28Since the litigation guardian signed the CFA in January 2018, the Solicitors Act, R.S.O. 1990, c. S.15 and O. Reg. 195/04 would apply. In Henricks-Hunter v. 814888 Ontario Inc. (Phoenix Concert Theatre), 2012 ONCA 496, 294 O.A.C. 333, the Ontario Court of Appeal indicated that a lawyer seeking to enter into an enforceable contingency fee agreement with a party under a disability must comply with s. 5(1) of O. Reg. 195/04 under the Solicitors Act.
29Section 5(1) of O. Reg. 195/04 provides that:
- (1) A solicitor for a person under disability represented by a litigation guardian with whom the solicitor is entering into a contingency fee agreement shall,
(a) apply to a judge for approval of the agreement before the agreement is finalized; or
(b) include the agreement as part of the motion or application for approval of a settlement or a consent judgment under rule 7.08 of the Rules of Civil Procedure.
30The CFA not having been approved by a judge before it was finalized, the court is now being asked to approve it as part of the proceeding to approve the settlement.
31The regulation mandates that the contingency fee agreement must be signed by both the lawyer and the client, and the signatures must be witnessed. Only the litigation guardian signed the agreement.
32The court must assess both the fairness and the reasonableness of the CFA. The CFA must be fair at the time it was signed, and the fees must be reasonable at the time of the settlement: Raphael v. Lam (2002), 2002 45078 (ON CA), 61 O.R. (3d) 417 (C.A.). The fairness of a CFA is assessed in the circumstances surrounding the making of the agreement and whether the client fully understood and appreciated the nature of the agreement: Raphael.
33The affidavit of the litigation guardian is silent as to the circumstances surrounding the making of the agreement which would have been especially important given the date the lawyer met with the litigation guardian and the date the litigation guardian signed the CFA are nine days apart.
34The onus is on the lawyer to show that the way the agreement was obtained is fair to the client: Raphael, at para. 37. The litigation guardian says nothing about whether she fully understood and appreciated the nature of the agreement. As for the lawyer’s affidavit, the information in the affidavit is at odds with the relevant provision of the CFA. At paragraph 14 of the affidavit, the lawyer deposes that she met with the litigation guardian on January 17, 2018, to discuss the CFA “in detail, noting that my firm will charge 33% of the settlement award exclusive of taxes on the legal fees and disbursements and applicable taxes on the disbursements.”
35Clause 5 of the CFA provides as follows:
The Contingency Fee:
- The following is the contingency fee and the manner in which it is calculated:
TORT
It is agreed that JRJ's compensation shall be 33 % plus applicable taxes of the total amount of the recovery of the CLIENT'S claim for General Damages, Special Damages, Family Law Act Damages, and Prejudgment Interest, whether by settlement or judgment, exclusive of legal costs and applicable taxes and exclusive of disbursements and any applicable taxes on the disbursements [emphasis added],
36A CFA can be declared void if the court determines that it is either unfair or unreasonable: Henricks-Hunter. I am not prepared to enforce the CFA for three reasons: i) the clause in the CFA is at odds with the lawyer’s evidence in her affidavit; ii) there is a dearth of evidence before me as to the circumstances surrounding the signing of the CFA by the litigation guardian and whether she fully understood and appreciated the nature of the agreement; and iii) the CFA is not signed by the lawyer as required by the regulation. I find that the CFA was not fair and is therefore null and void.
37Where a contingency fee agreement is found to be unenforceable, the court may nonetheless assess a lawyer’s legal fees “in the ordinary manner”, that is, by determining what is reasonable in all the circumstances: see Raphael at paras. 30-33 and 49-50; Henricks-Hunter.
38In assessing whether the fees are reasonable, the factors initially established by the Ontario Court of Appeal include the time expended by the solicitor, the legal complexity of the matter, the results achieved by the lawyer, as well as the risk assumed, including the risk of non-payment because of a real risk of an adverse finding on the issue of liability: Cohen v. Kealey & Blaney (1985), 10 O.A.C. 344; Desmoulin v. Blair (1994), 1994 333 (ON CA), 21 O.R. (3d) 217, 120 D.L.R. (4th) 700 (C.A.); Raphael, at para. 50.
39In determining the lawyer’s legal fees, the court must determine an amount that is reasonable, proportionate to the amount recovered by the plaintiff under disability and “reflective of the value of the work performed as it has advanced and benefited the interests of the plaintiff under a disability: Marrocco, at para. 61, per Wilkins J. In the affidavit of the lawyer, 56 hours is docketed by various timekeepers, including 26 hours by legal assistants. The time expended by legal assistants are part of overhead, and effectively only 30 hours would be assessable. The materials do not address the legal and factual complexity of the matter, the risk assumed by the lawyer, or the stage of the litigation at which the case settled. It appears from the computer-generated pre-bill that, aside from settlement negotiations, no other significant step was completed. The overall fees, inclusive of HST, associated with the docketed time of all timekeepers, which unfortunately includes the docketed time by legal assistants, is $19,032.00. It is impossible to determine what the fee is exclusive of their time. This is not a complex case. There is no evidence before me to establish that there was a significant liability risk or that the lawyers bore that risk.
40In my view, a reasonable fee is 20% of the damages, or $17,945, plus HST of $2,333, which would be proportionate to the amount recovered by the person under disability.
41I have no issue regarding the disbursements in the amount of $5,061.15, which I have allowed.
DISPOSITION
42In the result, I make the following order:
i. The settlement of $110,000 is approved.
ii. The contingency fee agreement is not approved and is not enforceable.
iii. The lawyer’s legal fees of $20,278.00, inclusive of HST, are approved.
iv. The disbursements of $5,061.15, as claimed, are approved.
v. OHIP’s Subrogated claim in the amount of $1,787.47 is approved in exchange for a release.
vi. Service of the Notice of Motion on the Children’s Lawyers is dispensed with.
vii. The amount of $82,873.38 for the benefit of the minor plaintiff shall be paid into court in accordance with r. 7.09 of the Rules of Civil Procedure.
A.P. Ramsay J.
Date: September 12, 2022