Court File and Parties

Court File No.: CV-25-0340-00
Date: 2025-02-26
Court: Ontario Superior Court of Justice

Between:
Alam Law Firm Professional Corporation
Applicant

and

Christine Roberts
Chubb Insurance Company of Canada
Respondents

Applicant Counsel: Sherzod Karimov (skarimov@thealamlaw.com)
Respondent Counsel: Tim Crljenica (for Chubb Insurance Company of Canada, tcrljenica@tgplawyers.com)
Christine Roberts: No representation

Heard: February 18, 2025, by video conference

Endorsement

LeMay J.

Introduction

[1] This is an Application by the Alam Law Firm Professional Corporation for a charging order against the Respondents. The Respondent Christine Roberts was a former client of the Applicant. The Respondent Chubb is an insurance company that provides Accident Benefits (“AB”) insurance for the Respondent Ms. Roberts.

[2] The Applicant was originally retained by Ms. Roberts in order to pursue both tort and accident benefits claims. There has been a breakdown of the solicitor-client relationship. According to the Applicant, Ms. Roberts is attempting to resolve her AB claim directly with Chubb. No tort claim has been commenced, and it does not appear likely that one will be commenced.

[3] For the reasons that follow, I have determined that the Applicant should not be entitled to a charging order as against Ms. Roberts. Given that the Applicant conceded in argument that it was not entitled to a charging order as against Chubb, the Application is dismissed.

Background

[4] In December of 2022, Ms. Roberts signed a retainer agreement with the Applicant. Under this agreement, the Applicant was to pursue her claim for benefits under the Statutory Accident Benefits Schedule (“SABS”). There was also an agreement between Ms. Roberts and the Applicant to potentially pursue a tort claim.

[5] Under both agreements, there was a provision that addressed disbursements as a first charge. That provision stated:

“We have the right to be reimbursed for these disbursements as a first charge on any amount you recover under an award of settlement of the matter.”

[6] There were also provisions in both agreements directing that funds received from the settlement of the matter had to be sent to the Applicant and placed in trust with them. In addition, the agreements also provided the Applicant with the right to recover disbursements and legal fees in the event that the retainer agreements were terminated before the case was concluded.

[7] Over the next year and a half, the Applicant retained experts and conducted investigations on behalf of Ms. Roberts. The Applicant incurred expenses on behalf of Ms. Roberts during this time period. However, in November of 2024, Ms. Roberts and the Applicant parted ways.

[8] A letter from the Applicant was sent to Ms. Roberts on November 1, 2024, confirming that there had been an irreconcilable breakdown in the solicitor-client relationship. It confirmed that the retainer agreement had been terminated, and advised that a bill for services rendered and disbursements would be provided.

[9] At the time when the retainer came to an end, there was no settlement with the Accident Benefit carrier. There was also no indication that there would be a settlement.

[10] The Applicant states that the total account amounts to $23,907.04, inclusive of HST and disbursements. However, they are prepared to reduce it to $18,869.36 inclusive of HST and disbursements.

[11] The Applicant seeks a first charge on the proceeds of settlement or any proceeds after judgment payable to Ms. Roberts. This charge is sought pursuant to section 34 of the Solicitors Act. They also seek an order directing Chubb to pay the first charge directly out of any settlement funds owing.

[12] Chubb attended at the motion and was opposed to any order being made against it. They took no position on whether or not the order should be granted as against Ms. Roberts. Counsel for the Applicant advised that he was not seeking an order as against Chubb at this point.

The Law

[13] The starting point is section 34 of the Solicitors Act, RSO 1990, c S.15, which states:

34 (1) Where a solicitor has been employed to prosecute or defend a proceeding in the Superior Court of Justice, the court may, on motion, declare the solicitor to be entitled to a charge on the property recovered or preserved through the instrumentality of the solicitor for the solicitor’s fees, costs, charges and disbursements in the proceeding.

[14] For a solicitor to be entitled to a lien under this section, there would have to be a superior court action that the solicitor had prosecuted or defended. By statute, the SABS claim must be brought before the Licence Appeal Tribunal (“LAT”). As a result, a SABS claim cannot be the subject of a charging order under the Solicitors Act: Ryan Naimark Professional Corporation v. Lilly, 2023 ONSC 1690, para 6.

[15] However, that conclusion does not end the matter for two reasons. First, the Court has a jurisdiction to grant a charging lien pursuant to its inherent jurisdiction. Second, there was both a SABS retainer and a tort retainer in this case. As a result, I need to consider whether a lien should be granted in this case.

[16] For a charging order under the Solicitors Act or a charging lien, the criteria are the same. Thomas Gold Pettinghill v. Ani-Wall Concrete Forming Inc., 2012 ONSC 2182, para 84, Lilly, supra at para. 8. Those criteria are:

a. The funds or property must be in existence at the time the charging order (or lien) is granted;
b. The property must have been “recovered or preserved” through the instrumentality of the solicitor; and
c. There must be some evidence that the client cannot or will not pay the solicitor’s fees.

[17] In addition, the Court has a discretion to grant or refuse a charging order even if the criteria for a charging order are otherwise met. Weenen v. Bidai, 2018 ONCA 288, para 15.

[18] In this case, I am not persuaded that the second criteria has been met. In that respect, the evidence does not demonstrate that the work of the Applicant has either improved the chances of the Client to obtain recovery in a tort action in Superior Court. In respect of the SABS claim, there is more evidence that the contingent value of this claim has been increased. However, it remains a contingent value. Specifically, the Applicant was involved in having Ms. Roberts moved to a different scale of benefits, which may have increased the amount of benefits she would be entitled to. However, I am not clear on how much this change would have benefitted Ms. Roberts.

[19] There was also some evidence that might have suggested that the Applicant had assisted Ms. Roberts in the recovery of some small additional amount of money in respect of a couple of expenses; it was an amount that was de minimis. Beyond that amount, there is no evidence to suggest that the work done by the Applicant resulted in the recovery or preservation of the property. As a result, the criteria for a lien are not met and one should not be granted.

[20] The Applicant relied on the Lilly decision. However, the facts in that case disclose that the offer obtained by the law firm in that case was “four times higher” than the offer originally made. In Lilly, the Court was satisfied that the law firm made a “substantial and integral” contribution to Mr. Lilly’s recovery (para. 21). That is different from the conclusion that I have reached in this case.

[21] I should also make one additional observation about discretion. One point that was not argued in Lilly relates to section 62 of the SABS. That section voids all assignments of benefits except in four circumstances:

a. An assignment to a tort defendant under section 267.8 of the Insurance Act;
b. An assignment to the Ministry of Community and Social Services;
c. An assignment to a delivery agent under the Ontario Disability Support Program Act, 1997 or the Ontario Works Act, 1997; or
d. An assignment to the Minister of Finance under subsection 6.1(4) of the Motor Vehicle Accident Claims Act.

[22] As a result, if there were an assignment of SABS benefits from Ms. Roberts to the Applicant, that assignment would be void. Therefore, even if I am wrong about whether the criteria for a charging lien has been met, I would exercise my discretion and refuse the request for the lien. The Court should not grant an equitable remedy that would circumvent the legislative intention to limit assignments of benefits. There are other remedies available to the Applicant to pursue its claims against Ms. Roberts.

Disposition

[23] For these reasons, the request for a charging order as against Ms. Roberts is dismissed.

[24] The Application originally sought a charging order as against Chubb as well. That relief was properly abandoned at the hearing of the motion, as there was no basis for it. That part of the application is also dismissed.

Conclusion

[25] For the foregoing reasons, the Application is dismissed.

[26] Ms. Roberts did not participate in this application and, as a result, is not entitled to costs. Chubb, on the other hand, may be entitled to costs. The parties, however, indicated that they were trying to work out the question of costs.

[27] To that end, if Chubb is seeking costs of this application, they may serve, file and upload costs submissions of no more than two (2) single-spaced pages, exclusive of bills of costs, offers to settle and case-law within ten (10) calendar days of the date of the release of these reasons. Copies are also to be sent to my judicial assistant electronically. Counsel will have received this decision by e-mail from her.

[28] The Applicant will then have ten (10) calendar days thereafter to serve, file and upload costs submissions of no more than two (2) single-spaced pages, exclusive of bills of costs, offers to settle and case-law. Copies are also to be sent to my judicial assistant electronically.

[29] There are to be no extensions on the time for serving costs submissions, even on consent, without my leave. If I do not receive costs submissions in accordance with this timetable, then there shall be no order as to costs.

[30] There shall be no reply submissions on costs, even on consent, without my leave.

Released: February 26, 2025

Robert LeMay