Ilic v. Ducharme Fox LLP, 2025 ONSC 1648
ONTARIO
SUPERIOR COURT OF JUSTICE
IN THE MATTER OF THE SOLICITORS ACT AND IN THE MATTER OF DUCHARME FOX LLP
BETWEEN:
SLAVKO ILIC
Applicant (Moving Party)
– and –
DUCHARME FOX LLP
Respondent
Michael A. Jaeger, for the Applicant
Ciarán T. McGrath, for the Respondent
HEARD: March 6, 2025
REASONS FOR JUDGMENT
CALLAGHAN J.
1This is a motion, pursuant to Rule 54.09(2) of the Rules of Civil Procedure, addressing an assessment under the Solicitors Act, R.S.O. 1990, c. S. 15. The assessment was conducted by Assessment Officer Ittleman. The client opposes confirmation of the Report and Certificate of Assessment issued on March 21, 2023 (the “Report”).
2The assessment relates to accounts regarding the retainer of the lawyer, Mr. Ducharme (the “Lawyer”) in respect of a drug trafficking and possession case involving the client, Mr. Iliic (the “Client”). The retainer involved three accounts spanning September 2009 to February 2010.
3This assessment was commenced in 2010. An assessment was conducted over three days in 2015 and 2018. The Assessment Officer held that he did not have jurisdiction to proceed with the assessment. That finding was appealed and wound its way to the Court of Appeal which held the Assessment Officer had jurisdiction and the matter was remitted back for consideration on the merits. At that time in 2022, the Court commented on the “astonishingly desultory pace” of this assessment - it is now 3 years on from that comment: Ilic v. Ducharme Fox LLP (Ducharme Weber LLP), 2022 ONCA 463, at para. 12.
4The Assessment Officer reduced the accounts from $185,653.95 to $163,343.66. As the Client had already paid $160,719.81, he owes the remaining $2,623.85.
5The Client states that the Assessment Officer erred in not reducing the account based on a) excessive “research” costs; b) excessive travel charges; and c) the overall amount of the accounts is said to be excessive relative to the retainer. The Client says the accounts should be reduced to $60,000.
Standard of Review
6A motion such as this is not a hearing de novo. In this case, the assessment was conducted over three days and both the Client and the Lawyer testified. The task for this Court is to determine if the assessment officer erred as a matter of principle. As stated by the Court of Appeal in Samuel Eng and Associates v. Ho, 2009 ONCA 150, at para. 1:
It is settled law that on an appeal from an assessment officer, the court is only concerned with questions of principle not with questions of amount or how the assessment officer exercised his discretion unless the decision is so unreasonable as to amount to an error in principle.
7Where the error is alleged to have been the application of the legal principles to the facts, the palpable and overriding standard is to be applied. This standard requires deference to the fact finding of the Assessment Officer and the assessment may only be varied where the determination is either not supported by any facts or there is misapplication of a legal principle which is inextricably linked to the finding. The Supreme Court of Canada in Hydro-Quebec v. Matta, 2020 SCC 34, 450 D.L.R. (4th) 547, at para. 33 described the standard as follows:
Absent a palpable and overriding error, an appellate court must refrain from interfering with findings of mixed fact and law made by the trial judge: [cases omitted]. An error is palpable if it is plainly seen and if all the evidence need not be reconsidered in order to identify it and is overriding if it has affected the result: [cases omitted]. As Morisette J.A. so eloquently put it in J.G. v. Nadeau, 2016 QCCA 167, at para.77, [translation] “a palpable and overriding error is in the nature not of a needle in a haystack, but of a beam in the eye. And it is impossible to confuse these last two notions”: quoted in Benhaim, at para. 39. The beam in the eye metaphor not only illustrates the obviousness of a reviewable error, but also connotes a misreading of the case who impact on the decision is plain to see.
8The court may also intervene if the amount is “so grossly large or small as to be improper beyond all question”: RZCD Law Firm LLP v. Williams, 2016 ONSC 2122, at para. 46: Starkman Barristers v. Cardillo, 2017 ONSC 5530, at para. 61. As stated by the Divisional Court in RZCD Law Firm LLP v. Williams:
47On an appeal of a certificate of assessment, the court will not interfere with the exercise of discretion of the assessment officer where the dispute involves no matter of principle but only a question of amount, unless the amount in question is so grossly large or small as to be improper beyond all question: [cases omitted]
9While this case was not argued based on inadequate reasons, it is worth recalling that the reasons serve several functions but principally they are intended to “allow the appeal court to engage in a meaningful review of the substantive merits of the decision under appeal”: Farej v. Fellows, 2022 ONCA 254, at para. 42. The decision maker is not required to address every fact or resolve every factual dispute that may be raised by a party. An appeal is not an opportunity to reweigh the evidence. As the Supreme Court noted in R. v. G.F., 2021 SCC 20, [2021] 1 SCR 801, at para. 79:
Where ambiguities in a trial judge’s reasons are open to multiple interpretations, those that are consistent with the presumption of correct application must be preferred over those that suggest error…
10Credibility findings require particular deference, given that the trier of fact has had the advantage of hearing the evidence. In this instance, the Assessment Officers not only had the advantage of hearing the witnesses but did so as an expert in Solicitor Act assessments: Starkman Barristers v. Cardillo, 2017 ONSC 5530, at para. 61.
Analysis
11This assessment began with a dispute as to the nature of the retainer. The Lawyer testified that the retainer was to be a block fee of $200,000 but the retainer was not reduced to writing. There was some debate before the Assessment Officer on this point as the Lawyer had rendered interim accounts setting out his hourly rate and fees. The Assessment Officer, in the absence of a written retainer, held that the Lawyer failed to meet his onus of establishing the block fee retainer, although the Assessment Officer clearly accepted that a block fee was the Lawyer’s intent.
12In the absence of a written retainer, the Assessment Officer proceeded to conduct the assessment on a quantum meruit basis. No issue is taken with this determination, but it informs the nature of the assessment and the Assessment Officer’s reasoning.
13The Court of Appeal in Newell v. Sax, 2019 ONCA 455, at para. 3 described the general principles to be applied in conducting a quantum meruit assessment as follows:
A quantum meruit assessment is not a bookkeeping exercise or a mechanical calculation. Rather, a quantum meruit assessment is concerned with the reasonable value of services rendered and requires an assessment officer to undertake a nuanced, contextual approach having regard to all the relevant circumstances: [ cases omitted]
14The factors to be applied were set out in Cohen v. Kealey (1985), 10 O.A.C. 344 (C.A.), at p. 346. They include:
The time expended by the solicitor;
The legal complexity of the matter dealt with;
The degree of responsibility assumed by the solicitor;
The monetary value of the matters in issue;
The importance of the matter to the client;
The degree of skill and competence demonstrated by the solicitor;
The results achieved;
The ability of the client to pay; and
The reasonable expectation of the client as to the amount of fees.
15There is no issue that the Assessment Officer averted to the applicable principles for carrying out a quantum meruit assessment. The complaint is that he did not properly assess the evidence in accordance with those principles. The Client submits that I must assess the Assessment Officer’s findings against the evidence. The Client asserts the evidence does not support the findings of the Assessment Officer. In doing so, I am cognizant that my job is not to reweigh the evidence but rather I must determine if the Assessment Officer patently misapprehended the evidence to such an extent that the decision cannot stand. I am also alive to the fact that a palpable and overriding error should be plainly obvious and not require a reassessment of the all the evidence to identify the error.
16The first complaint is that the Lawyer charged $69,000 for what the Client says is research. This was an amount calculated by the Client’s Lawyer, Mr. Jaeger, who amalgamated certain of the Lawyer’s dockets that he claimed were legal research. The Client asserts that this amount of legal research was unnecessary. The Client states he was caught “red-handed” by the police. He argues there was little for the Lawyer to do other than to have the Client plead guilty – legal research was not required. He further asserts that the Lawyer is renowned for his expertise in criminal law, and he ought to have known the law. The subtext of the argument is that these dockets did not reflect real work. Finally, if the research was necessary, it ought to have been assigned to a junior Lawyer.
17The Lawyer disagrees with the characterization of the dockets as “research”. The Lawyer was of the view that this was a complex case. The Client was a person of interest in respect of another drug case which complicated matters. It was not a certainty that a plea would be accepted by the Crown. Moreover, the principles to be applied in sentencing were far from clear. These “research” dockets, in fact, reflected the Lawyer’s strategizing which was informed by his reading and digesting the facts in the voluminous Crown brief and the case law. Contrary to the Client’s assertion, the Lawyer was not educating himself but applying his skill and knowledge to the Client’s problem in accordance with his craft.
18In the end, the sentence was reduced on several grounds that saved the Client three or more years of incarceration and, ultimately, he was never charged in the other drug case under consideration.
19In considering these arguments, the Assessment Officer found that regardless of the ultimate plea, counsel was rightly preparing for a possible trial. He accepted that there was more to this case than simply a plea. He accepted there was a considerable amount of work related to sorting out the appropriate considerations for sentencing and the involvement of the Client in the other alleged drug offence. Further, he expressly accepted that the dockets reflected the real work of the Lawyer.
20The Assessment Officer made the following findings:
Similarly, I find that the time expended on what Mr. Jaeger characterizes as research was both necessary and reasonable. The "research," as described on Mr. Jaeger's summary, entailed the following: Identifying and reviewing case law with respect to sentences for trafficking cocaine, the impact of co-operation on sentencing, and drafting memoranda; review of the disclosure brief; preparation for trial and sentencing; reviewing Crown submissions; reviewing instructions from Client; and considering the possible impact of proposed new legislation. Mr. Ducharme disagreed with the labelling of all of the work on Mr. Jaeger's summary as "research." In my view, it matters not what this body of work is called because it advanced the Client's position and enabled Mr. Ducharme to provide him with effective and competent representation. No reduction in the fees relating to "research" is warranted.
21In my view, the Assessment Officer took the “nuanced, contextual approach” he was required to take on this matter. He had regard to the work undertaken and the fact that the work furthered the cause of the Client. He concluded that the work was necessary and of value to the Client. I do not see an error in this analysis. Frankly, the Client wishes me to reweigh and reassess the evidence, which is not appropriate and, in any event, not required. There is no error in principle and no palpable and overriding error.
22On the issue of travel time, the Lawyer docketed his travel time at 100% of his hourly rate. The evidence was that on many occasions the Lawyer’s wife, who worked in his practice, drove with him to the detention facility where the Client was detained. On those occasions, the wife would read the case brief and case law to him. The Crown brief alone was over 2,500 pages. The wife was called as a witness on the assessment and testified on this issue.
23The Assessment Officer dealt with this issue as follows:
Regarding travel time, I accept the evidence that much of Mr. Ducharme's travel by automobile was spent having briefs and other material read to him by Janice Ducharme, an employee of the firm who travelled with him on four to six occasions. Ms. Ducharme testified that, as Mr. Ducharme drove, she would read material to him and he would dictate notes that she would record in the margin or highlight portions pursuant to his directions. I did not hear evidence as to a similar practice by Ms. Santarossa. The general rule is that travel time billed at one-half of a Lawyer's usual rate is reasonable. In light of Mr. Ducharme using his travel time for a productive purpose on behalf of the Client, I am of the view that it would be reasonable to allow 75 percent of the fees for travel time. My review of the dockets discloses travel time of 42 hours, corresponding to fees of $27,300.00. A reduction of 25 percent equals $6,825.00. This results in the total fees being reduced to $146,238.0015.
24The Assessment Officer clearly addressed the issue of the travel time and reduced the request. In doing so, he accepted that some work was done while travelling and allowed 75% rather than his general rule of 50%. In my view, he weighed the evidence and applied a nuanced and contextual analysis. He had regard to the standard recovery of 50% for travel time which involved a Lawyer who travels but does no work. He increased it to 75% as he accepted the testimony of the Lawyer and his wife.
25It was argued by the Client that the evidence of the Lawyer was contradictory on whether his wife travelled with him. The Lawyer had at one stage indicated that his wife did not like to wait outside prisons. It was argued that I should find that the Lawyer was not credible on this issue. As already noted, issues of credibility are the domain of the trier of fact. From the outset, the Assessment Officer was alive that reliability and credibility were an issue. He commented that both the Lawyer and the Client had difficulty remembering certain details and the Client’s recollections tended to be selective. It is argued that the Assessment Officer did not specifically address the alleged inconsistencies in the Lawyer’s testimony. The Assessment Officer is not required to weigh each statement a witness makes or resolve every asserted inconsistency: Thompson v Ontario (Attorney General), 2016 ONCA 676 at para. 25. Rather, as an appellate judge, I need to satisfy myself that the decision maker was alive to the issue and that the decision is one that is supported by the evidence. The Assessment Officer expressly relied on the corroborative evidence of the wife. In my view, the Assessment Officer’s finding on the travel time is both reasoned and reasonable. I see no error in principle and no palpable and overriding error.
26The Client made an omnibus argument that the fee charged was too high because of the Assessment Officer’s misapplication of the principles in Cohen v. Kealy. Consistent with the case law, he did not take a mechanical approach: Newell v. Sax, at para. 41. Rather, in his reasons, the Assessment Officer went through each factor and weighed the totality of those factors in considering the appropriate fee. The Client now seeks me to reweigh the factors. Again, I am asked to examine the record and to determine if the amount awarded for fees is “so grossly large…as to be improper beyond all question”. The Client made arguments on each criterion. The criteria are not watertight compartments. As such, assessing the Assessment Officer’s analysis of each criterion merely addresses whether there was an error in the inputs to his calculation of the appropriate fee. I will briefly address the Client’s arguments on the criteria he seeks to have reconsidered.
27On the time expended by the Lawyer, as noted above, the Assessment Officer made an express finding that the Lawyer’s time dockets accurately reflected the work performed by the Lawyer. In doing so, the Assessment Officer turned his mind to the veracity of the Lawyer and accepted that he performed the work that he claimed to have performed. On this criterion, the Client again raises the issue of the research and travel time which was dealt with above. In my view, the Assessment Officer was entitled to make that finding and there was no error in the Assessment Officer’s consideration of this criteria.
28On the issue of legal complexity, as noted, the Client argues that this was not a complex matter because the Client was, as he asserts, caught “red-handed”. The Assessment Officer found the matter to be complex, including the issue of whether the Client would receive a reduction in his sentence for co-operation. The evidence bears out that this was a complex criminal case. For example, the Lawyer testified that the Client was the target of a multi-police force investigation with evidence suggesting the Client was the head of an international organization smuggling drugs into Canada. The Lawyer testified a significant amount of work was done to convince the prosecutor not to proceed in respect of other charges. In addition, the Lawyer spent time strategizing and reviewing case law to address how the court should address the co-operation of the Client in determining sentence, a point on which the sentencing judge commented there was a “paucity” of case authority.
29It is clear from the decision that the Assessment Officer accepted that this was a complex case requiring a senior counsel’s attention. He put the complexity this way in his decision:
This was a factually complex matter, involving serious criminal charges against Mr. Ilic and the corresponding risk of a lengthy period of incarceration resulting therefrom. Not only did this time serve the Solicitors well in preparing for the possibility of a trial, it also put Mr. Ducharme in a position where he could negotiate a plea bargain arrangement that was acceptable to Mr. Ilic and present effectively at the sentencing hearing.
30In my view, the record affirms this was a complex case requiring a deft legal hand. There was no error in the Assessment Officer’s consideration of this criterion.
31On the degree of responsibility, the Assessment Officer set out the factors in Mok v. Abbass [2013] O.J. No 5160. In doing so, he was critical of the Lawyer for not having a written retainer, for not clearly explaining the billing process and for not being as clear as he ought to have been on his dockets. He assessed a 10% reduction of the accounts on this basis.
32The Client asserts that there was more conduct that warranted a reduction. In particular, the Client states that more work ought to have been delegated to a junior Lawyer. Once again, the Assessment Officer found this to be a complex case. The Assessment Officer was alive to the fact that the Lawyer was very senior and found the work of the Lawyer to be reasonable and necessary to achieve the result. I do not see an error in the Assessment Officer’s consideration of this issue. The finding reasonably flows from the evidence.
33On the issue of degree of skill and result, the Client states that the Assessment Officer misapprehended the result. It is said that the Client received a sentence of 10 years reduced to 5 years for time served and other considerations. It is suggested that 10 years was at the high to mid-range of what was submitted by the parties as the appropriate sentence and that little skill was required to achieve this result. Notwithstanding this submission, the Client’s counsel was unable to articulate what the “other considerations” were that resulted in a reduction of the sentence of three or more years. This is an argument that would necessitate reassessing a great deal of evidence which itself foretells it is not a palpable and overriding error.
34The Assessment Officer found that the Lawyer achieved an “outstanding result”. The Assessment Officer explained the success in some detail:
53Mr. Ilic was charged with very serious criminal offences after having been audio- recorded on wiretaps and videotaped conducting drug transactions. According to Mr. Ducharme, a drug courier had identified Mr. Ilic as the "kingpin" of a drug importation operation.
54Early on, Mr. Ducharme was successful in convincing the Crown not to proceed against Mr. Ilic with certain charges relating to his interaction with the drug courier. Had Mr. Ilic been painted in this light before the Court and charged with conspiracy, the ramifications for him could have been considerably more serious. In addition, Mr. Ducharme was successful in having the charges against the Client severed from charges brought against co-conspirators involved in the same criminal enterprise. As a result of obtaining the Crown's agreement, it was not necessary to formalize the motion in this regard that the Solicitors had been working on. Similarly, obtaining the Crown's consent to unseal some information used to obtain warrants obviated the need to formalize a motion for this relief.
55Pending a resolution of the charges, Mr. Ilic was in custody. At one point in time, he was in danger of retribution while at the Maplehurst facility as a result of having been labelled a "rat." Mr. Ducharme was able to obtain an order from the Court to move the Client to another facility where he would not be in jeopardy.
56The charges that the Client faced carried with them a possible sentence of life imprisonment. As of October 21, 2008, the Crown was proposing a guilty plea and a sentence of twelve to fifteen years of incarceration, depending upon the conditions to be attached to the sentence. The Crown further advised that, if a trial date was set, the minimum they would seek would be eighteen years.
57Even after a plea bargain agreement was negotiated in September 2009, the Crown was seeking a sentence of eleven years' incarceration. Mr. Ilic was sentenced to a net period of incarceration of five years after consideration of mitigating factors, a sentence comparable to what was imposed on others in the enterprise who had been found in possession of less than one-tenth the quantity of 35 kilograms of cocaine that Mr. Ilic had been found with. In addition, Mr. Ilic was saved harmless in the agreement whereby he could not face further charges relating to the same drug operation even if he were subsequently identified by other individuals as having committed additional criminal offences. This outstanding result was reflective of a high degree of skill and competence demonstrated by Mr. Ducharme. No reduction in the fees is warranted under this factor.
35In my view the Assessment Officer’s findings are supported by the evidence and are entitled to deference. There was no error in principle and no palpable and overriding error in his consideration of the success achieved.
36On the issue of the Client’s expectation, the Client takes issue that the Assessment Officer accepted that the Lawyer advised the Client that the fee would be $200,000. It will be recalled that the assessment was conducted on a quantum meruit basis only because the Lawyer failed to document the block fee retainer. The Assessment Officer dealt with this directly when he found, “Mr. Ducharme informed Mr. Ilic at the outset that the matter would cost the client $200,000.00. I accept this testimony as credible.” He went on to point out the Client provided a retainer of $181,000 retainer which was consistent with an expected final account of $200,000.
37It is submitted that the Assessment Officer ought to have required corroboration before accepting the Lawyer’s version of this discussion. Absent very specific circumstances, the law does not require evidence to be corroborated; the evidence of one witness is legally capable of meeting the burden of proof in a civil proceeding: Brisco Estate v. Canadian Premier Life Insurance Company, 2012 ONCA 854, at para. 59. I was pointed to no case law or statutory authority that required the Lawyer’s evidence to be corroborated.
38In my view, the Assessment Officer was entitled to accept as credible the evidence of the Lawyer that he advised the Client to expect an account of $200,000. In this regard, I see no error in principle and no palpable and overriding error in the Assessment Officer accepting the Lawyer’s evidence or the conclusion drawn from that evidence.
39Having considered each criterion, I do not see any basis for this Court to interfere with the Assessment Officer’s conclusion as to the appropriate quantum of the fee. The Assessment Officer took a nuanced and contextual approach, and his conclusions were supported by the evidence. In my view, there was no error in principle or palpable and overriding error in the Assessment Officer’s quantum meruit assessment.
Conclusion
40This motion is dismissed. The Report and Certificate of Assessment issued on March 21, 2023, are hereby confirmed.
41The parties have agreed to partial indemnity costs of $21,500 subject to consideration of any rule 49 offers. If there is a rule 49 offer that impacts the cost award, the requesting party shall file no more than a 3 page submission within 7 days of the release of this decision. The responding party may file a responding submission within 4 days thereafter of 3 pages.
Callaghan J.