Court File and Parties
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: JAGDIP K. BHOGAL, Applicant
AND:
MURRAY LAWSON LLP, Respondent
BEFORE: Parghi J.
COUNSEL: Karen Zvulony, for the Applicant
Erin Chaiton-Murray and Sydney Franzmann, for the Respondent
HEARD: April 14, 2026
Endorsement
1The plaintiff is a former client of the defendant family law firm. The parties are having a fee dispute. The plaintiff wants to have her fees assessed under the Solicitors Act, R.S.O. 1990, c. S.15. The defendant says all fee disputes are to be arbitrated, pursuant to an arbitration clause in the retainer agreement between it and the plaintiff.
2Both parties agree that section 7 of the Arbitration Act, 1991, S.O. 1991, c. 17 applies. Section 7 provides, in relevant part:
7 (1) If a party to an arbitration agreement commences a proceeding in respect of a matter to be submitted to arbitration under the agreement, the court in which the proceeding is commenced shall, on the motion of another party to the arbitration agreement, stay the proceeding.
(2) However, the court may refuse to stay the proceeding in any of the following cases: …
- The arbitration agreement is invalid.
3The plaintiff urges me to exercise my discretion not to stay her fee assessment proceeding, pursuant to section 7(2). She urges me to do this on the basis that the arbitration agreement is invalid, because it is unconscionable. There appear to be three strands to her argument: the arbitration provision was not explained to her, she signed the retainer agreement while in extreme distress, and the arbitration provision’s terms – namely, its requirements that the costs of arbitration be shared by the parties, and that the arbitrator be experienced, which means that the arbitrator will invariably be expensive – are oppressive.
4In determining whether to grant a stay under section 7 of the Act, I am to consider (1) whether there is an arbitration agreement, (2) what the subject matter of the dispute is, (3) what the scope of the arbitration agreement is, (4) whether the dispute arguably falls within the scope of the arbitration agreement, and (5) whether there are grounds on which I should refuse to stay the proceeding (Haas v. Gunasekaram, 2016 ONCA 744, at para. 17).
5The first four parts of this test are not in dispute before me. The record shows and neither party contests that there is an arbitration provision in the retainer agreement and that the subject matter of the dispute falls within the scope of the arbitration provision. The retainer agreement provides: “While we do not expect that there will be any dispute about your fees or our representation of you, if any arises it will be governed by the Alternate Dispute Resolution terms of Schedule ‘C’ to the Retainer Agreement which we ask you to review and sign.” Schedule “C” in turn provides, “any and all claims, disputes, allegations or issues arising out of or relating to this Retainer Agreement and Murray Lawson LLP’s representation of you shall be submitted to binding arbitration”.
6The issue before me is the fifth branch of the test: whether there are grounds on which to exercise my discretion to refuse to stay the plaintiff’s fee assessment proceeding. I may do so under section 7(2) of the Act.
7I conclude that the circumstances before me do not warrant exercising my discretion to refuse the stay.
8The leading Supreme Court of Canada authority on unconscionability is Uber Technologies Inc. v. Heller, 2020 SCC 16, [2020] 2 S.C.R. 118. The Court in Uber described unconscionability as a doctrine in equity that may be used to set aside unfair agreements that result from an inequality of bargaining power (at para. 54). It reasoned that a case may present “serious flaws in the contracting process that challenge the traditional paradigms of the common law of contract, such as faith in the capacity of the contracting parties to protect their own interests” (at para. 58).
9The Court held that, to demonstrate unconscionability, a party must show an inequality of bargaining power and a resulting improvident bargain (at para. 65). There is an inequality of bargaining power where one party cannot adequately protect their interests in the contracting process (at para. 66). If they are personally vulnerable or suffer from disadvantages specific to the contracting process, and are therefore unable to understand and appreciate the full impact of the contractual terms, this “cognitive asymmetry” may give rise to an inequality of bargaining power (at paras. 67-72). An improvident bargain is one that unduly advantages the stronger party or unduly disadvantages the more vulnerable party (at para. 74). In assessing the terms of the bargain, the courts should consider the surrounding circumstances at the time the contract was entered into, including the market price and the position of the parties (Uber, at para. 75).
10On the record before me, I am not persuaded that there was unequal bargaining power between the parties or a resulting improvident bargain.
11Having regard to unequal bargaining power, the plaintiff may well have been in distress when she needed a lawyer and when she signed the retainer agreement. But there is no evidence before me as to her level of distress, and certainly not any evidence that her distress rose to the level required to ground a finding of unequal bargaining power. That is, the record does not persuade me that her distress gave rise to a disadvantage specific to the contracting process that left her unable to understand and appreciate the full impact of the terms of the agreement.
12Nor do I see evidence of improper tactics or undue pressure by the defendant firm in respect of the retainer agreement. The arbitration provision is clearly laid out in the agreement. The plaintiff was given the opportunity to review the agreement and ask any questions she had about it prior to signing it. She asked no questions. She signed it. She signed the bottom of each page, next to a notation stating, “I have read and understood all of the terms set out in” that page. She signed Schedule “C” regarding arbitration twice. There is no evidence to suggest she was limited in her ability to review or understand the agreement or to have her questions about it answered. There is no evidence she was pressured to sign.
13Likewise there is no evidence of a resulting improvident bargain. Plaintiffs’ counsel submits that the arbitration provision is oppressive because it requires that the costs of arbitration be shared by the parties, and requires that the arbitrator be experienced, with the result that the arbitrator will invariably be expensive. I do not give effect to this submission. The arbitration provision in fact states the arbitrator may order costs to be allocated between the parties in some fashion other than a 50-50 split. In any event, the fact that the provision may impose a financial cost on the plaintiff does not on its own mean that it represents an improvident bargain.
14Plaintiff’s counsel further submits that her client has a right to have her fees assessed. The suggestion is that the plaintiff has a statutory right to assess legal fees through the court under the Solicitors Act, which prevails over the terms of the retainer agreement before me. Again, I cannot agree. While parties cannot contract out of the substantive statutory protections contained in the Solicitors Act, such as the right to have an independent assessment of fees by an independent assessor, parties can choose to have an arbitrator conduct the assessment rather than a judge (Jean Estate v. Wires Jolley LLP, 2009 ONCA 339, 310 D.L.R. (4th) 95, at paras. 73-74). Here, the arbitration provision does just that. The parties’ choice to resolve disputes through an arbitrator must be respected.
15I therefore stay the fee assessment proceedings commenced by the plaintiff and order that the dispute be addressed via arbitration.
Parghi J.
Date: April 17, 2026