Court File and Parties
Court File No.: CV-18-76004 Date: 2024/06/26 Ontario Superior Court of Justice
Between: Jayson Andrew Hopkins, Plaintiff – and – Patrick Neil Murphy and Beament Green LLP, Defendants
Counsel: Richard Campbell, for the Plaintiff Stephen Cavanagh and Robin S. Brown, for the Defendants
Heard: March 4 – 21, 2024
Reasons for Decision
R. Smith J.
[1] The plaintiff, Jayson Hopkins (“Hopkins”), seeks damages of approximately $3 million from his former lawyer, Patrick Murphy, and the law firm of Beament Green (collectively referred to as “Murphy”) for negligently advising him to settle his lawsuit in 2008. Hopkins submits that the amount of $127,900 that he settled for general damages and for loss of income was too low.
[2] Hopkins suffered serious injuries in a motor vehicle accident, which occurred on November 11, 2003, when he drove his vehicle into the rear of a tractor-trailer stopped off the travelled portion of the highway on the shoulder of the Anderson Road on-ramp to Highway 417. Hopkins alleges that Murphy was negligent and breached his contract when he recommended that Hopkins settle his action for $127,900.
[3] The plaintiff alleges that Murphy failed to meet the standard of a reasonably prudent solicitor practising law in Ontario and prosecuting a tort claim, namely that he failed to negotiate a fair and reasonable settlement of Hopkins’ tort claim, he failed to adequately investigate the facts related to the accident, and failed to conduct discoveries before recommending the settlement.
[4] Hopkins also submits that the court should apply the doctrine of “loss of chance” to determine liability and damages in this case, and should not apply the case law that has developed for “improvident settlement” cases.
[5] Murphy denies that he was negligent or breached his retainer agreement. He submits that he met the standard of a prudent solicitor in this case and that the settlement was reasonable in the circumstances of this motor vehicle accident. He submits that he conducted an adequate investigation of the accident in order to recommend the settlement, including reviewing the police report, speaking with the independent witness to ascertain his observations, reviewing the medical records, obtaining an expert medical report, obtaining an income loss report from an experienced actuary, speaking with an experienced accident reconstruction expert on two occasions for his advice and opinion, personally visiting the accident scene, and researching the case law that applied to rear-end collisions.
[6] Murphy submits that Hopkins alleges that he recommended an improvident settlement. As a result, the procedure to be followed in improvident settlement cases as set out in the case law should be followed. Murphy argues that to prove Hopkins’ claim of an improvident settlement, Hopkins was required to conduct a “trial within a trial”, unless this was impossible. Murphy further submits that the loss of chance approach is inappropriate in these circumstances. The plaintiff did not conduct a trial within a trial and did not call any evidence to demonstrate that this was impossible. As a result, Murphy submits that Hopkins’ claim should be dismissed.
[7] The defendant further argues that even if the loss of chance approach was followed, the plaintiff’s claim should still be dismissed because he has failed to meet the first criteria set out in the Ontario Court of Appeal’s decision of Folland v. Reardon (2005), 74 O.R. (3d) 688 (C.A.). Namely, the plaintiff has failed to prove on a balance of probabilities that “but for” Murphy’s wrongful conduct the plaintiff had a chance to obtain a benefit. In this case, the plaintiff failed to call any evidence to support a finding that Murphy failed to meet the required standard of care or that his outcome could have been improved, either by further negotiations or after a trial.
[8] Finally, the defendant submits that Hopkins failed to call any expert evidence to establish Murphy’s professional negligence, which is required, as a general rule, according to the Court of Appeal’s decision in Krawchuk v. Scherbak, 2011 ONCA 352, 106 O.R. (3d) 598, leave to appeal refused [2011] S.C.C.A. No. 319. Hopkins also failed to call any evidence to establish that either of the two exceptions to calling expert evidence of the standard of care applied in this case.
Issues
[9] The following issues must be decided:
a. Issue #1 - Has the plaintiff proven on a balance of probabilities that Murphy was negligent or breached his contract with Hopkins when he recommended that Hopkins accept the settlement amount?
b. Issue #2 - Should the court apply the doctrine of loss of chance to determine liability and damages in these circumstances?
Factual Background
[10] Hopkins suffered serious injuries in a motor vehicle accident, which occurred on November 11, 2003 at 1:05 a.m. Hopkins was travelling eastbound on Highway 417 when he drove his vehicle into the rear of a transport truck, stopped on the shoulder of the on-ramp from Anderson Road to Highway 417. The transport truck was stopped approximately one metre off the travelled highway with all of its lights on, including its four-way flashers on the rear of the truck, at the time of the accident.
[11] Hopkin’s vehicle was wedged completely under the tractor-trailer and his insurance determined that his vehicle was completely destroyed. Hopkins was not wearing a seatbelt at the time of the accident.
[12] Hopkins suffered serious injuries including a traumatic brain injury and has no memory of the accident or anything that occurred on the day before or the day after the accident. He testified that, based on the three movie tickets that he found in his coat pocket, he believed that he had watched three movies at the Kanata Theatre on the night of the accident.
[13] Hopkins initially retained the lawyer William Garay to represent him with all matters related to the injuries he suffered in the motor vehicle accident. Mr. Garay issued a statement of claim on November 10, 2005 on Hopkin’s behalf. Mr. Garay passed away shortly thereafter and his law firm was closed on March 31, 2006.
[14] On December 6, 2006, approximately three years after the accident occurred, Hopkins retained Murphy to represent him for all matters arising out of the accident. He signed a contingency agreement with Murphy, wherein Murphy agreed that he would prosecute all appropriate tort claims in the circumstances.
[15] On July 20, 2007, Mark Charron, the solicitor for the defendants Jean-Paul Groulx (the driver of the tractor-trailer) and Excel Global Logistics (the owner of the tractor-trailer and 163679 Canada Ltd.) filed a statement of defence. The owner of the leased trailer, Ryder Truck Rental, did not file a statement of defence before the settlement was reached at mediation.
[16] On August 11, 2008, the parties attended a mediation before Stephen Kelly at which the parties negotiated a full and final settlement of the tort claim for the all-inclusive amount of $127,900. The parties signed minutes of settlement and full and final releases on August 24, 2008.
[17] The Family Law Act, R.S.O. 1990, c. F.3, claim for the plaintiff’s two children was subsequently approved by the court at $5,000 based on affidavit evidence, including that of the plaintiff.
Issue #1 – Has the plaintiff proven on a balance of probabilities that Murphy was negligent or breached his contract with Hopkins when he recommended that Hopkins accept the settlement amount?
[18] The parties disagree about the nature of the plaintiff’s claim. The plaintiff submits that the court should determine the issue of negligence, breach of contract, and damages by applying the doctrine of “lost chance”. The defendant argues that where the plaintiff alleges that a solicitor was negligent in recommending a settlement amount, as in this case, it must be dealt with as an improvident settlement, which requires that a trial within a trial be held, unless this is shown to be impossible.
[19] At para. 20 of his statement of claim, the plaintiff sets out his allegations of negligence against Murphy. In addition to alleging that Murphy failed to meet the standard of a prudent solicitor, at paragraphs 20 (b) and (c) he specifically claims that Murphy settled the plaintiff’s claim for a nominal amount and failed to negotiate a fair and reasonable settlement. The plaintiff then sets out sets out a number of steps that Murphy allegedly failed to take before recommending the settlement. All of the other allegations relate to Hopkins’ claim that Murphy failed to negotiate a fair and reasonable settlement of his tort claim as a result of his negligence and breach of contract. The essence of the plaintiff’s claim is that he did not receive a fair and reasonable amount of damages when he followed his solicitor’s advice and agreed to the settlement.
Law on Solicitor’s Negligence Involving Settlements
[20] In Folland, at paras. 40-41, the Court of Appeal stated that the standard to be applied in cases of allegations of negligence arising out of the conduct of litigation is a reasonableness standard.
[21] In Basandra v. Guerette, 2018 ONSC 582, 76 C.C.L.I. (5th) 335, at para. 8, the court set out the standard as “whether [the] advice was ‘outside the range of reasonable choices’” and stated as follows:
[8] The question that this claim raises is not whether Guerette [the lawyer] was right or wrong in advising the Plaintiff [the client] the way he did. Rather, the question is whether this advice was “outside the range of reasonable choices that could have been made by a competent member of the profession”: Di Martino v. Delisio, 2008 CarswellOnt 4275, at para 54. This standard “does not call for an assessment of the sagacity of a lawyer. The standard demands that the lawyer bring to the exercise of his or her judgment the effort, knowledge and insight of a reasonably competent lawyer”: Folland, at para 40-41.
[22] The American text by Ronald E. Mallen, Legal Malpractice (St. Paul: Thomson Reuters, 2024) (loose-leaf updated 2024), sets out the general common law principles for cases involving alleged improvident settlements as follows:
a. “Even skillful and experienced negotiators do not know whether they received the maximum settlement or paid out the minimum acceptable. Thus, the goal of a lawyer is to achieve a ‘reasonable’ settlement, a concept that involves a wide spectrum of considerations and broad discretion”: Mallen, at §33:89.
b. “The standard should be whether the settlement is within the realm of reasonable conclusions, not whether the client could have received more or paid less. No lawyer has the ability to obtain for each client the best possible compromise but only a reasonable one”: Mallen, at §33:90.
c. “Causation, the opportunity to have achieved a better settlement must be establish[ed]”: Mallen, at §33:91.
d. “Usually, the plaintiff’s attorney is not liable for an inadequate settlement if the client would not have prevailed. Typically, the issue is resolved by the ‘trial-within-a-trial’ methodology” (footnote omitted): Mallen, at §33:91.
e. “When the client, as a former plaintiff, is entitled to base a damage claim on an inadequate settlement, then the client must establish not only that concluding such a settlement fell outside the standard of care, but also what would have been a reasonable settlement and that such sums would have been agreed to and could have and would have been paid” (footnotes omitted): Mallen, at §33:91.
[23] The Defendant cited California and British cases which, while not binding on this court, set out the common law principles that are followed in those jurisdictions. One of the above principles is that in addition to establishing that the solicitor failed to meet the standard of care of a reasonable, prudent solicitor, the plaintiff must also prove what would have been a reasonable settlement. In this case, Hopkins has not presented any evidence of what a reasonable settlement would have been, other than his submission that he should be awarded a higher amount than the settlement reached.
[24] The plaintiff also failed to comply with his undertaking, given at discoveries, to provide particulars of “what would have been a reasonable settlement”. The plaintiff has not done so and has not called any evidence at trial to establish what a reasonable settlement would have been.
[25] In Jarbeau v. McLean, 2017 ONCA 115, 410 D.L.R. (4th) 246, at para. 20, the Ontario Court of Appeal discussed the possibility of using the loss of chance approach. The Court of Appeal, at para. 29, cited with approval the British Columbia Court of Appeal decision of Nichols v. Warner, Scarborough, Herman & Harvey, 2009 BCCA 277, 95 B.C.L.R.(4th) 133, leave to appeal refused, [2009] S.C.C.A. No. 355, where that court, in turn, quoted the following passage from Fisher v. Knibbe, 1992 ABCA 121, 3 Alta. L.R. (3d) 97, at para. 12:
After conducting the “trial within a trial” to determine what damages, if any, a negligent solicitor is liable for missing a limitation period, three results are possible. First, the trial judge could find that had the case gone to trial the plaintiff would have been successful and in such case 100 per cent of the lost damages would be awarded against the solicitor. Second, the trial judge could find that the plaintiff would not have been successful therefore only nominal damages may be awarded against the solicitor. Finally, where time has passed to such an extent that a “trial within a trial” would be impossible, then the court must to the best of its ability calculate the value of the opportunity lost to the plaintiff and award damages against the solicitor on that basis. [Emphasis added.]
[26] In Jarbeau, the Ontario Court of Appeal held that the defendant lawyer could not rely on a loss of chance approach, but stated that courts have allowed a plaintiff to advance a claim for loss of the chance to recover where it was impossible to determine what would have happened. The Court of Appeal, at para. 20, stated as follows: “In some cases of solicitor’s negligence, where it is practically impossible to determine what would have happened but for the solicitor’s negligent conduct, courts have allowed a plaintiff to advance a claim for loss of chance to recover”.
[27] The Jarbeaus had purchased a home with a leaky basement that did not meet the standard set by Ontario’s building code. The engineer retained by the builder had negligently certified that the design and construction of the home met the applicable building standards. The lawyer hired by the Jarbeaus to seek damages from those responsible for selling them a defective home negligently advised them that they did not have a cause of action against the engineer because they did not have a contract with him. As a result, they failed to sue the engineer within the limitation period.
[28] The Jarbeaus sued their former solicitor for damages suffered as a result of his negligent advice. A trial within a trial was conducted and the jury found in the Jarbeaus’ favour. In the Jarbeaus’ situation, the defendant solicitor had admitted negligence.
[29] In Jarbeau, the Ontario Court of Appeal held that in cases of solicitor’s negligence, the plaintiff must establish on a balance of probabilities that the solicitor was negligent. At para. 17, the Court of Appeal quoted the following from Clements v. Clements, 2012 SCC 32, [2012] 2 S.C.R. 181, at para. 8: “The plaintiff must show on a balance of probabilities that ‘but for’ the defendant’s negligent act, the injury would not have occurred. Inherent in the phrase ‘but for’ is the requirement that the defendant’s negligence was necessary to bring about the injury … If the plaintiff does not establish this on a balance of probabilities … [the action] fails.”
[30] To summarize, in lawyer’s negligence cases that allege an improvident settlement, the procedure to be followed is to conduct a trial within a trial, unless it is practically impossible to determine what would have happened “but for” the lawyer’s negligence. If it is impossible to conduct a trial within a trial, then the plaintiff may resort to the loss of chance approach.
[31] The plaintiff referred to the English case of Kitchen v. Royal Air Force Association, [1958] 2 All E.R. 241 (C.A.), which involved a missed limitation period and was not an improvident settlement case. However, in Jarbeau, at para. 22, the court indicated that there had been a trial within a trial in that case to determine what would have happened if the plaintiff had been able to sue.
[32] The court in Kitchen did not accept that it must be “always all for the plaintiff or nothing” (at p. 250) and set out three possible scenarios as follows, at pp. 250-51:
a. Where “it is plain that an action could have been brought, and, that if it had been brought, it must have succeeded”. In such a case “[t]he damaged plaintiff then would recover the full amount of the damages lost by the failure to bring the action originally.”
b. “[I]f it be made clear that the plaintiff never had a cause of action, that there was no case which the plaintiff could reasonably ever have formulated, then it is equally plain that she can get nothing save nominal damages for the solicitors’ negligence.”
c. There may be cases where it would be quite impossible to try “the action within the action”, as counsel asks:
It may be that for one reason or another the action for negligence is not brought until, say, twenty years after the event, and in the process of time the material witnesses, or many of them, may have died or become quite out of reach for the purpose of being called to give evidence. In my judgment, assuming that the plaintiff has established negligence, what the court has to do in such a case … is to determine what the plaintiff has lost by that negligence. The question is: Has the plaintiff lost some right of value, some chose in action of reality and substance? In such a case it may be that its value is not easy to determine, but it is the duty of the court to determine that value as best it can.
[33] In Kitchen, it was possible to conduct a trial within a trial and this was done. This case does not stand for the proposition that the plaintiff gets to choose whether to conduct a trial within a trial or to apply the loss of chance doctrine. The Jarbeau situation would have fallen within the first category set out in Kitchen, namely that “it [was] plain that an action could have been brought against the engineer and would have succeeded”: Jarbeau, at para. 38.
[34] The plaintiff also referred to the case of Henderson v. Hagblom, 2003 SKCA 40, 232 Sask. R. 81, leave to appeal refused, [2003] S.C.C.A. No. 278, a decision of the Saskatchewan Court of Appeal where leave to appeal was denied by the Supreme Court of Canada. Henderson involved an allegation of negligent defence of a construction deficiency claim. It was not an improvident settlement case and as a result is distinguishable, and a trial within a trial did in fact take place. The Saskatchewan Court of Appeal overturned the trial judge and followed a loss of chance analysis and applied a probability of 75 percent rather than a legal certainty.
[35] In Beldycki Estate v. Jaipargas, 2012 ONCA 537, 295 O.A.C. 100, a medical malpractice case, the Ontario Court of Appeal stated, at para. 84, as follows:
[84] Third, the argument advanced by the appellant is based on flawed reasoning. Once it was established on a balance of probabilities that the appellant’s negligent failure to detect the liver lesion caused the metastasis of the colon cancer, no principle of law entitled the appellant to a discount from the full measure of the [sic] Adam Beldycki’s damages to reflect the chance that, even given prompt treatment after deduction [sic], the colon cancer might well still have metastasized…
[36] In Jarbeau, at para. 31, the court came to the same conclusion as Beldycki and stated the following: “Where a plaintiff advances a tort claim for damages founded on the ‘but for’ causation test, Folland does not support Mr. McLean’s argument that some degree of probability between 50% and 100% should reduce a defendant’s liability.” As a result, the principle set out in Henderson of applying a degree of probability when the “but for” test has been met is not the law in Ontario.
[37] In the Alberta case of Adeshina v. Litwiniuk & Company, 2010 ABQB 80, 24 Alta. L.R. (5th) 67, Justice Sheilah Martin, now of the Supreme Court of Canada, outlined the law applicable to claims against lawyers following the settlement of their client’s claim. This case involved a collision between a passenger car and a tractor-trailer where the plaintiff’s claim was settled before trial. Liability was admitted.
[38] Justice Martin stated that the procedure to follow in a case alleging professional malpractice is the conduct of a trial within a trial. At para. 4 of Adeshina, Martin J. stated as follows:
[4] In Alberta, the practice of courts hearing a professional malpractice action is, when necessary, to conduct a “trial within a trial” to ascertain the loss, if any, caused by the lawyer’s breach of duty. It calls for a determination of the merits, as can be best accomplished, of the underlying action which in the case at bar is Mr. Adeshina’s personal injury claim. A “trial within a trial” requires a judge to try the hypothetical action that the plaintiff would have had against the original defendant but for the negligence of the professional, including issues of liability, causation and damages.
[39] At para. 503, Martin J. set out how damages should be determined when a plaintiff alleges that a lawyer recommended a settlement that was too low, and she stated as follows:
[503] In a case where the allegation is that the lawyer has settled for too low an amount, damages should be assessed as the “difference between the amount a reasonably competent solicitor would have recommended as a settlement figure considering all the circumstances existing at that time and what the defendant solicitor recommended as an appropriate settlement”. An appropriate settlement figure might be less than the amount that counsel would estimate as an appropriate award had the matter gone to trial, since settlements usually involve compromises.
[40] In Adeshina, Martin J. dismissed the plaintiff’s claim, finding that the settlement was “well within the range that could have been expected”: at para. 365.
[41] Based on the above case law, I conclude that to determine liability and damages in a solicitor’s negligence case alleging an improvident settlement, the court must conduct a trial within a trial to determine liability and the amount of damages the plaintiff would have received following a trial. The court must then determine if the difference between the amount settled for and what the plaintiff would have received after a trial is within a reasonable range of possible choices that could have been made by a competent member of the profession. If it is impossible to conduct a trial within a trial, courts have allowed a plaintiff to advance a claim for loss of the chance to recover.
[42] In the case before me, Hopkins has not conducted a trial within a trial and has not called any evidence to establish why it was not possible to conduct a trial within a trial. Hopkins does not have any memory of the accident. No evidence was called about the availability of the independent witness; the original investigating officer who prepared the police report; Mr. Martel, the income loss expert retained on behalf of the plaintiff; or Mr. Williamson, the accident reconstruction expert Murphy consulted.
[43] The plaintiff submitted that due to the passing of approximately 20 years, a trial within a trial was impossible and therefore argued that the court should follow a loss of chance approach. However, the plaintiff did not call any evidence. I disagree with this submission and find that in such a situation, the plaintiff has the onus to prove on a balance of probabilities that a trial within a trial was not possible. The plaintiff has failed to call any evidence to meet this onus.
Alleged Negligence and Breach of Contract by Mr. Murphy
[44] The plaintiff made allegations of negligence and breach of contract by Murphy, many of which speculate about what might have been discovered and are as follows:
a. He failed to negotiate a fair and reasonable settlement. However, this would have required a trial within a trial to determine. The plaintiff failed to conduct a trial within a trial or to present evidence to prove that this was impossible.
b. He failed to adequately investigate the facts and liability. However, Murphy took the following steps:
i. He obtained and reviewed approximately three years of medical records and reviewed the medical reports from a psychiatrist and an orthopedic surgeon.
ii. He obtained a loss of income report from a qualified actuary who assessed Hopkins’ loss of future income at approximately $1.4 million as of November 11, 2003. The plaintiff called an expert economist who assessed the plaintiff’s loss of future income as of March 4, 2024 at approximately $1.7 million. In the decision of Rose v. Mitton (1994), 1994 NSCA 19, 128 N.S.R. (2d) 99 (C.A.), the Nova Scotia Court of Appeal held that the date on which damages of an improvident settlement crystallize is the date of the alleged negligence of the lawyer settling the claim, which would be August 7, 2008. The plaintiff’s expert used the wrong date to calculate damages as he should have used August 7, 2008 or the anticipated date of trial instead of March 4, 2024. As a result, the plaintiff’s expert’s evidence on loss of income is not given any weight. The amounts are in the same range in any event even though the plaintiff’s expert used the wrong date.
iii. He failed to examine Hopkins’ damaged vehicle. The police report summary was admitted as a business record and stated that Hopkins’ vehicle was completely destroyed. Murphy was retained on December 6, 2006, approximately three years after the accident occurred. No evidence was introduced about the chances of locating Hopkins’ destroyed vehicle at a wrecking yard or the chances of being able to examine his wrecked vehicle after December 2006. Murphy’s failure to attempt to locate and examine the destroyed vehicle to possibly discover a mechanical failure, which might have caused Hopkins to lose control of his vehicle without him being negligent, is pure speculation and not evidence of negligence or breach of contract.
iv. He failed to obtain an accident reconstruction report. Murphy spoke with Mr. Williams, a recognized accident reconstruction expert, on two occasions to discuss obtaining an accident reconstruction report. Mr. Williams advised Murphy that he did not want to receive such a report from him because it would not help his client. If Murphy obtained an unfavourable accident reconstruction report, he would have to disclose its existence in his affidavit of documents. In addition, how the accident occurred was not in dispute, as the police report clearly indicated that Hopkins “drove off road and struck the rear of V2” (the tractor-trailer). The police report also showed that the tractor-trailer was parked off the travelled portion of the highway, approximately one metre onto the shoulder of the on-ramp to Highway 417 from Anderson Road. Murphy also spoke to the independent witness who was driving behind Hopkins’ vehicle at the time of the accident, who told him that Hopkins drove his vehicle off the highway into the rear of the tractor-trailer. The independent witness also stated that the tractor-trailer’s lights, including the rear flashing lights, were on at the time of the accident. Murphy failed to make notes of his conversation with the independent witness, but this had no effect on the outcome and Murphy’s evidence of what he was told was not contradicted in any way. Murphy also personally visited the accident scene and did not observe any “no parking” signs in the area where the tractor-trailer was stopped. His evidence was not contradicted. The tractor-trailer was stopped and not parked in any event, as the tractor-trailer driver stated in his statement to the insurance adjuster that he had stopped to check his brake hoses. Murphy was aware of all of this information.
v. He failed to investigate the legal liability. Murphy instructed a junior lawyer at his law firm to research the liability issue and was informed after the junior lawyer reviewed the case law that Hopkins was presumed to be responsible for causing the accident because he struck the rear of the tractor-trailer, which was stopped off the highway. Murphy was aware of the case law stating that Hopkins was presumptively 100 percent liable for the accident. He was also aware that flares or warning signs were not required because the transport truck was not stopped on the travelled portion of the highway.
vi. He failed to conduct discoveries before recommending a settlement at mediation. The plaintiff argues that if discoveries had been conducted, Murphy would have been able to determine a number of facts, such as whether the driver of the transport truck had exceeded the number of hours he was allowed to drive. This is true but is speculative and the truck was legally stopped on the shoulder of the ramp and was not a causation factor. Whether the transport truck driver stopped to check his brake hoses, as stated to the insurance adjuster, or stopped to relieve himself is not relevant to causation of the accident. Murphy would have been able to review the maintenance records of the transport trailer. Again, this is correct but this is also speculative as the tractor-trailer drove away from the accident scene and was not in a disabled condition.
[45] The plaintiff has not presented any evidence to establish negligence or causation of the accident by the driver of the tractor-trailer, nor has he presented any evidence to refute the presumption of his own negligence. The plaintiff offers speculation that some evidence of the driver of the tractor-trailer’s negligence might have been discovered or that some evidence might have been discovered to disprove the presumption that he was fully responsible for causing the accident. In these circumstances, a court cannot take judicial notice of any negligence on the part of the transport truck driver or take judicial notice that Hopkins was not fully responsible for causing the accident.
[46] In Krawchuk, at para. 132, the Ontario Court of Appeal stated that, as a general rule, it will not be possible to determine professional negligence without the benefit of expert evidence, subject to two exemptions. The first exception is where it is possible to reliably determine the standard of care without the assistance of expert evidence. This will be the case when the court is faced with “nontechnical matters or those of which an ordinary person may be expected to have knowledge”: Krawchuk, at para. 133, quoting Zink v. Adrian, 2005 BCCA 93, [2005] 4 W.W.R. 420. The second exception applies where the “actions of the defendant are so egregious that it is obvious that his or her conduct has fallen short of the standard of care, even without knowing precisely the parameters of that standard”: Krawchuk, at para. 135.
[47] In this case, where Hopkins is alleging that Murphy recommended an improvident settlement, the question is whether his advice was “outside the range of reasonable choices that could have been made by a competent member of the profession”. The appropriate standard applicable to a personal injury motor vehicle lawyer in the circumstances of this case is not a “non-technical matter” that an ordinary person would have knowledge nor were Murphy’s actions or failure to take additional steps so egregious that it is obvious to an ordinary person that his conduct fell short of the required standard of care. As a result, I conclude that expert evidence was required to determine whether Murphy met or failed to meet the standard of care of a prudent solicitor in these circumstances, and that neither of the two exceptions set out in Krawchuk apply in this case.
[48] The plaintiff simply made submissions that Murphy was negligent for failing to make a number of possible additional inquiries, including failing to conduct discoveries before settling at mediation and failing to obtain an accident reconstruction expert report. The plaintiff argues that he lost the chance to obtain a greater settlement amount or a greater amount after trial. In any settlement, the plaintiff loses the chance to obtain a greater amount after trial but also removes the risk of obtaining a lesser amount or being completely unsuccessful.
[49] The court does not have any evidence of what would have occurred if a trial within a trial had been held and has not received any evidence to support a finding that it was impossible to conduct a trial within a trial in this case. The plaintiff also failed to answer his undertaking to advise what would have been a reasonable amount for settlement. The plaintiff simply seeks to recover damages for 100 percent liability against the tractor-trailer driver or some lower amount based on the probability that he would have been successful in attributing a percentage of liability against the tractor-trailer driver that exceeded the settlement amount.
[50] The plaintiff also argued that in this case I should apply s. 4 of the Negligence Act, R.S.O. 1990, c. N.1, and apportion liability equally between the driver of the tractor-trailer and Hopkins if I am unable to determine with precision the respective degrees of fault or negligence between them.
[51] Section 4 of the Negligence Act reads as follows:
If it is not practicable to determine the respective degree of fault or negligence as between any parties to an action, such parties shall be deemed to be equally at fault or negligent.
[52] Section 4 of the Negligence Act could only have possible application if the plaintiff had conducted a trial within a trial, but he has not done so and is instead arguing for a loss of chance analysis. There is no evidence before me to show that “it is not practicable to determine the respective degree of fault or negligence” because the plaintiff chose not to conduct a trial within a trial where such evidence might have been called. Finally, the Negligence Act does not apply to a breach of contract claim.
[53] In Martin v. Listowel Memorial Hospital (2000), 51 OR (3d) 384 (C.A.), at paras. 22, 24, the Ontario Court of Appeal stated that s. 4 is only intended to apply when it is fair to apportion responsibility equally. At para. 24, the Court of Appeal stated as follows: “When the section speaks of impracticability, it refers to the difficulty in making a quantifiable distinction between the degrees of fault because they appear to be very close, not because it is always difficult to assign a number to something which is not precise or calculable.”
[54] The only evidence the plaintiff presented on the issue of liability was the police report. The police report indicates that Hopkins drove his vehicle into the rear of the tractor-trailer while it was stopped on the shoulder of the on-ramp. The plaintiff has not called any evidence to rebut the presumption that he was solely responsible for causing the accident and the evidence does not point to negligence on the part of anyone but the plaintiff himself. In these circumstances, the evidence of the respective degrees of negligence between Mr. Groulx and Hopkins is not close, with a much greater degree of if not total responsibility on Hopkins. As a result, I find that s. 4 of the Negligence Act is not applicable in the circumstances for the above reasons.
Disposition of Issue #1
[55] For the above reasons I find that the plaintiff has failed to prove on a balance of probabilities that Murphy was negligent or breached his contract with Hopkins as he failed to present any expert evidence, as required by Krawchuk, that Murphy’s advice was outside the range of reasonable choices that could have been made by a competent member of the profession. The plaintiff has also failed to conduct a trial within a trial as required in improvident settlement cases to allow the court to determine negligence, causation, and to determine the damages caused by the negligent act. The plaintiff also failed to call any evidence of what a reasonable settlement amount was in the circumstances of this case.
Issue #2 - Should the court apply the doctrine of loss of chance to determine liability and damages?
[56] I have held that the plaintiff has failed to prove that Murphy was negligent or breached his contract when he recommended that Hopkins accept the settlement amount. I have also held that the plaintiff failed to prove that Murphy recommended an improvident settlement as he failed to conduct a trial within a trial or to call evidence to establish that it was impossible to conduct a trial within a trial in the circumstances. If I am mistaken about this, I will consider the plaintiff’s claim on a loss of chance approach.
[57] In Jarbeau, at paras. 26-28, Pardu J. summarized the principles of a cause of action for breach of contract based on a solicitor’s negligence. At para. 27, she stated as follows:
Where a plaintiff in a tort action arising out of solicitor’s negligence can establish on the balance of probabilities that but for the negligence he or she would have avoided the loss, he or she should be fully compensated for that loss.
[58] At para. 28, Pardu J. stated as follows: “Where a plaintiff can only establish that but for the solicitor’s negligence he or she lost a chance to avoid a loss, a claim for breach of contract may permit recovery for the value of that chance.”
[59] In Folland, the Court of Appeal outlined the elements of a cause of action for breach of contract based on solicitor’s negligence.
[60] Justice Pardu summarized these principles in Jarbeau, at para. 26, where she stated that “lost chance is well recognized as a basis for assessing damages in contract. In contract, proof of damage is not part of the liability inquiry. If a defendant breaches his contract with the plaintiff and as a result the plaintiff loses the opportunity to gain a benefit or avoid harm, that lost opportunity may be compensable.”
[61] At para. 26 of Jarbeau, the Court of Appeal set out criteria that had to be met to recover damages for lost chance in an action for breach of contract as follows:
a. The plaintiff must establish on the balance of probabilities that but for the defendant’s wrongful conduct, the plaintiff had a chance to obtain a benefit or avoid a loss.
b. The plaintiff must show that the chance lost was sufficiently real and significant to rise above mere speculation.
c. The plaintiff must demonstrate that the outcome, that is, whether the plaintiff would have avoided the loss or made the gain, depended on someone or something other than the plaintiff himself or herself.
d. The plaintiff must show that the lost chance had some practical value.
[62] The plaintiff’s first obligation is to prove on a balance of probabilities that Murphy was negligent or breached his contract (retainer) with Hopkins. I have found under Issue #1 that the plaintiff failed to prove that Murphy was negligent or that “but for” Murphy’s alleged wrongful conduct (i.e., breach of contract), Hopkins had a chance to obtain a benefit of a greater settlement. The plaintiff failed to present any expert evidence to establish on a balance of probabilities that Murphy failed to meet the standard of care or breached the terms of his contract when he recommended the settlement or that it was outside the range of reasonable choices that could have been made by a competent member of the profession.
[63] I found under Issue #1 that the plaintiff did not fall within one of the exceptions to the general rule that expert evidence was required to establish the required standard of care in cases of professional negligence as set out in Krawchuk. The range of reasonable choices that could have been made by a competent member of the profession is not a simple matter as it involves actuarial evidence of future lost income and assessing contributory negligence, if any in a rear-end collision. The court can not take judicial notice of the standard of care required in the circumstances of this case.
[64] In paras. 44-49, above, I have set out reasons why I have concluded that the plaintiff failed to establish that Murphy was negligent and failed to meet the required standard of care when recommending that Hopkins agree to the settlement. The same findings support a conclusion that the plaintiff also failed to establish on a balance of probabilities any wrongful conduct (i.e., breach of contract) on Murphy’s part when recommending the settlement to the plaintiff.
[65] The procedure for a loss of chance claim is a two-stage process involving causation and quantum, as set out by the Ontario Court of Appeal in Berry v. Pulley, 2015 ONCA 449, 335 O.A.C. 176, at para. 70. The causation analysis to be conducted at the first stage is a “but for”, which is a negligence concept. In Berry, the Court of Appeal held that the plaintiff had to establish all of the four Folland factors at the first stage of the loss of chance analysis (causation). In the present case, the plaintiff’s claim fails on the first of the Folland factors, as I have found above that the plaintiff has failed to prove on a balance of probabilities that Murphy was negligent or failed to meet the standard of care of a prudent solicitor.
[66] In Waters v. Furlong et. Al., 2023 ONSC 3908, at para. 120, Justice Carole Brown stated as follows:
[120] To establish loss of chance, the plaintiff must prove on a balance of probabilities that the defendant’s wrongful act caused him to lose a substantially real and significant chance to obtain a benefit. The action must be dismissed if the plaintiff fails at that first stage.
[67] Both the Berry and Folland decisions have established the required probability for “a substantially real and significant chance” at 15 percent or higher. The plaintiff has failed to show that the lost chance to have obtained a greater settlement amount was 15 percent or greater.
[68] To determine the value of the plaintiff’s loss of chance, the court would have to apportion liability between Groulx, the driver of the tractor-trailer, and Hopkins, and this would require conducting a trial within a trial.
[69] In Beaumont v. Ruddy, [1932] O.R. 441 (C.A.), at p. 442, the Ontario Court of Appeal stated as follows: “Generally speaking when one car runs into another from behind, the fault is in the driving of the rear car, and the driver of the rear car must satisfy the Court that the collision did not occur as a result of his negligence”. In order to rebut the inference, the plaintiff must adduce evidence to rebut the presumption that he was negligent. In this case, Hopkins has failed to do so. So, the onus rests on Hopkins to satisfy me that the collision did not occur as a result of his presumed negligence and he has failed to do so.
Disposition of Issue #2
[70] If the loss of chance approach was used, I find that the plaintiff would be unsuccessful because he failed to prove at the first stage, on a balance of probabilities, that Murphy was negligent by failing to meet the standard of care of a competent member of the profession.
[71] For the above reasons, I also find that the plaintiff was required to conduct a trial within a trial to determine whether the advice Murphy gave to settle for the amount offered was outside the range of reasonable choices that could have been made by a competent member of the profession. As a result, I conclude that the court should not apply the doctrine of loss of chance to determine liability and damages in the circumstances of this case.
Costs
[72] The defendants shall have 15 days to make submissions on costs, the plaintiff shall have 15 days to respond, and the defendants shall have 10 days to reply. Submissions are not to exceed 10 pages.
Justice Robert Smith
Released: June 26, 2024