Fraser Milner Casgrain LLP v. Kristof Financial Inc., 2012 ABQB 359

Court of Queen ’ s Bench of Alberta Citation: Fraser Milner Casgrain LLP v. Kristof Financial Inc., 2012 ABQB 359 Date: 20120529 Docket: 1101 05614 Registry: Calgary Between: Fraser Milner Casgrain LLP Appellant - and - Kristof Financial Inc. and Frederic Kristof Respondent _______________________________________________________ Reasons for the Decision of the Honourable Mr. Justice K.D. Yamauchi _______________________________________________________ I. Introduction [ 1 ] This matter comes before this Court as an appeal from a review officer’s decision (the “Taxation Decision”), pursuant to the Alberta Rules of Court , AR 124/2010 [“ Rules ”].

II. Facts [ 2 ] The Taxation Decision resulted from a review of the Appellant’s account that it rendered to its former clients, the Respondents. The hearing before the review officer took place on December 12, 2011. This was done at the Respondents’ request pursuant to Rules ,

Part 10, Subdivision 4. Following the review, the review officer issued a certificate that reduced the amount of the Appellant’s account. [ 3 ] Pursuant to Rules r 10.13(3), the Respondents filed the Appellant’s account and a copy of the retainer agreement between the Appellant and the Respondents dated March 18, 2011 (the “Agreement”). Pursuant to that rule, the Respondents filed no other materials. The Appellants filed no materials in preparation for the review. [ 4 ] A hearing was held and a transcript from that hearing was provided to this Court (“Transcript”). III.

Preliminary Matter [ 5 ] This matter came before Sullivan, J. in morning chambers on February 15, 2012. The Appellant takes the position that Sullivan, J. allowed the appeal and directed a re-hearing of the taxation in special chambers. There is no order on the file which indicates what Sullivan, J. ordered.

Appellant’s counsel advised this Court that Sullivan, J. would not allow this matter to be heard as a hearing de novo , with viva voce evidence. [ 6 ] It is difficult to imagine that Sullivan, J. would allow the appeal from the review officer in morning chambers, when he had before him the 59-page Transcript, an affidavit with 27 exhibits, and other materials. Although the Appellant’s counsel presented this Court with a transcript of the hearing before Sullivan, J., it did not direct this Court to the portion where Sullivan, J. apparently allowed the appeal.

It directed this Court to the portion where Sullivan, J. said that the parties could rely on other materials they chose to file. In preparation for the hearing before this Court, the Appellants filed four affidavits, two of which were extensive, and the Respondents filed one. [ 7 ] Beyond the practical reasons why Sullivan, J. could not deal with an appeal from a review officer’s decision in morning chambers, the argument that he permitted additional materials to be filed would have been beyond his jurisdiction.

An appeal from a review officer’s decision is an appeal on the record of the proceedings before the review officer: Rules r 10.26(2). Rules r 10.26(3) is very clear as to what constitutes the “record of proceedings,” when it says:

(3) The record of proceedings is (

a) Form 42 served under rule 10.13(2), (

b) the material the parties filed to support or oppose, or that was required for, the review, (

c) the transcript of the proceedings before the review officer, unless the judge waives this requirement, and (

d) the review officer’s certificate. Rules rr 10.26(4) and 10.26(5) permit the parties, as well, to serve on the other party a written argument.

[8] Appellant’s counsel candidly advised this Court that she did not draw Sullivan, J.’s attention to Rules r 10.26(3). Had shedone so, this Court has no doubt that Sullivan, J. would have asked the parties to comply with that rule. No rule permits either party toprovide further evidence or affidavit material. As Wachowich CJQB, as he then was, said in 509703 Alberta Ltd. v.

Witten Binder, 2000ABQB 729 at para 19 [“509703"], “The appeal of the decision of a taxing officer is generally not a hearing de novo but a true appeal ...”It is interesting to note that Wachowich CJQB was not dealing with an appeal of a decision of the taxing officer, but an application forleave to adduce viva voce evidence at a de novo hearing.

He concluded, at para 35: ... [T]he principles governing appeals of taxations must generally inform the decision whether to grant such leave in any given case.Given Rule 656 and the approach to taxation appeals taken by the courts, leave to adduce viva voce evidence must be viewed asextraordinary relief. Having examined the issues before the taxation officer and the reasons issued in this matter, the Court has not beenpersuaded that the taxation officer exceeded his jurisdiction, nor that he otherwise erred in principle or in law, such that a de novohearing with viva voce evidence is warranted.

In reaching this conclusion, the Court emphasizes the extraordinary nature of the reliefrequested, and confines its remarks to the question of leave ... [9] Under rule 656 of the Alberta Rules of Court, Alta Reg 360/68 [“Old Rules”], a court could allow the parties to rely onevidence beyond that which was before the taxing officer. That is the issue with which Rooke, J., as he then was, dealt preliminarily inPanther Petroleum Ltd v.

Code Hunter, 2002 ABQB 158 at para 3 [“Panther Petroleum”], where he said: Rule 656 provides: "Unless otherwise ordered, the appeal shall be confined to the items and grounds specified and shall be heard on theevidence before the taxing officer." Therefore, "[u]nless otherwise ordered", such an appeal is not a hearing de novo but rather a hearingon the record and, accordingly, a record is required. [Emphasis added.] [10] Rules r 10.26(3) does not give the court the opportunity to allow further materials to be presented to it for the purposes of theappeal. [11] Even if this Court (or Sullivan, J.) had the ability to allow the parties to tender new evidence, which in this Court’s view itdoes not, neither the Appellant nor the Respondents in this case have sought leave to tender new evidence by way of affidavit.

Had theymade that application, this Court would be guided by the principle set forth in R v. Palmer, (SCC), [1980] 1 SCR 759 at775, 106 DLR (3d) 212, where the Court said:

(1) The evidence should generally not be admitted if, by due diligence, it could have been adduced at trial provided that this generalprinciple will not be applied as strictly in a criminal case as in civil cases,

(2) The evidence must be relevant in the sense that it bears upon a decisive or potentially decisive issue in the trial,

(3) The evidence must be credible in the sense that it is reasonably capable of belief, and

(4) It must be such that if believed it could reasonably, when taken with the other evidence adduced at trial, be expected to haveaffected the result. The requirements are conjunctive, in the sense that if a party fails on one aspect, a court will not admit the new evidence. In this case, theparties fail on the first branch. All the evidence set forth in the affidavits could have been adduced at the hearing before the reviewofficer. This is a civil matter, so this Court must be stricter in its application of this branch of the test. [12] Rules r 6.14(3), which deals with appeals from a Master’s judgment or order provides:

(3) An appeal from a master’s judgment or order is an appeal on the record of proceedings before the master and may also be based on

additional evidence that is, in the opinion of the judge hearing the appeal, relevant and material. This rule specifically addresses the issue of admitting new evidence in an appeal of a Master’s decision. Although the Rules could havecontained a similar provision in relation to an appeal from a review officer’s decision, they do not. [13] Why does Rules r 10.26(3) exist?

The Alberta Law Reform Institute, Consultation Memorandum 12.17, “Rules of CourtProject: Costs and Sanctions” (February 2005) at 59 (“Consultation Memorandum 12.17") said, in rather blunt terms: In practice it is not uncommon for appellants to refer to, or file, new evidence in an appeal from the taxing officer. One reason is thatsome self-represented litigants understand the process more fully after the taxation hearing and realize that additional evidence willimprove their cases. However, some lawyers also engage in this practice. [14] The Rules are clear.

The parties must put their best case, including all materials on which they intend to rely, before thereview officer. If the parties feel that the review officer “exceeded his jurisdiction” or “that he otherwise erred in principle or in law,”they must make that argument, in written form, as permitted, or orally, on appeal, based on the “record of proceedings.” [15] Thus, this Court permitted the parties to argue this as an appeal of the review officer’s decision, using the record ofproceedings. IV.

Standard of Review [16] When one reviews the many cases that deal with appeals from decisions of review officers (or taxing officers, as they wereformerly known), there are certain principles that emerge. A review officer’s decision is entitled to curial deference: 509703 at para 11.Why? A review officer’s “duties commonly call for him to do this type of vetting because of the nature of his position and the expertisethat he gathers in carrying out those duties”: Carr & Co v. Markdale Ltd. (1996), (AB KB), 46 Alta LR (3d) 324 atpara 20 (QB) [“Carr & Company”]. See also McLennan Ross v.

Mercantile Bank of Canada (1988), 1988 ABCA 224 , 59Alta LR (2d) 369 at para 6 (CA) [“McLennan Ross”]. The Alberta Court of Appeal in McLennan Ross went on to say that, “the taxingofficer's function is a specialized one and he may have to bring his own experience and expertise to bear” (at para 12). [17] Curial deference, however, is not absolute.

A court hearing an appeal from a review officer’s decision may interfere if thereview officer “operated on a wrong principle and thereby fell into error”: McLennan Ross at para 6, citing Cape Breton Landowners v.Stora Kopparbergs Bergslags Aktiebolag (1983), (NS CA), 33 CPC 1, 146 DLR (3d) 369, 58 NSR (2d) 193, 123APR (NSCA); Petty v. Bishop & McKenzie (1977), 2 AR 241 at 243 (QB). An error in principle may include a situation where thequantum that the review officer awards is inordinately high or low: McLennan Ross ibid; 509703 at para 11.

Similarly, a court hearingan appeal from a review officer’s decision may interfere if the review officer makes an error concerning the scope of the retaineragreement under which the parties are operating: Brown v. Snyder & Associates, 2004 ABQB 899 at para 20 [“Brown”]. Finally, a courthearing an appeal from a review officer’s decision may find that the review officer made a finding of fact that is clearly in error: Carterv.

Blake (1982), 41 AR 418 at para 7 (NWTCA) [“Carter”]. [18] With respect to the latter point, a court hearing an appeal from a review officer’s decision must exercise caution, and must notstep too far into arena of gathering evidence and weighing that evidence. As the court said in McLennan Ross at paras 11-12: I do not read R. 657 as giving the judge sitting on appeal a power to reassess or reweigh the material before the taxing officer. There aresome matters of discretion open to a taxing officer and open for review by the judge hearing the appeal, but not the assessment of avalue.

In making his assessment the taxing officer is not exercising a discretion, any more than the judge who fixes general damages isexercising a discretion. There are practical grounds for not making the hearing before the reviewing judge a de novo hearing. In the first place, the taxing officerwill often hear evidence and examine material which gives rise to questions of credit or weight. A chambers judge cannot effectivelysubstitute his views on such questions.

This makes it clear that the parties must put forward their “best case” to the review officer; not to the court hearing the appeal. V. The Record of the Proceedings [ 19 ] The court hearing the appeal from a review officer’s decision will review the record of the proceedings. This includes the material the parties filed to support or oppose the review.

In this case, there were no additional materials that the parties filed. [ 20 ] In Brown , Acton J said, “the case law is clear that taxing officers are not required to give extensive reasons ... [However,] a complete lack of reasons may be grounds to refer a matter back to the taxing officer ...” (at para 25). Furthermore, the Transcript will help this Court determine the comprehensiveness of the review officer’s enunciation of the various considerations that went into his consideration in determining the appropriateness of the Appellant’s fees: Carr & Company at para 20.

In this case, the proceedings were recorded and the parties filed the Transcript. VI. The Review Officer ’s Review [ 21 ] Rules r 10.9 provides us with the scope of a review officer’s duties. It says: 10.9 The reasonableness of a retainer agreement and the reasonableness of a lawyer’s charges are subject to review by a review officer in accordance with these rules, despite any agreement to the contrary. [ 22 ] Of course, this requires the review officer to review the retainer agreement itself. Rules r 10.17(1) says that the review officer may: (

f) require details of a retainer agreement, or of the services provided, money collected and expended, disbursements or other charges claimed or any other matter necessary to understand the agreement or charges and decide whether the agreement or charges, or both, are reasonable; [ 23 ] If there is a question concerning the terms of the retainer agreement, the review officer “must” refer the question to the court for a decision and direction: Rules r 10.18(1)(a). [ 24 ] The Appellant argues that the review officer in this case erred when he accepted the unsworn evidence of the Respondents during the review hearing. Rules r 10.17(1)(

a) says: 10.17(1) For the purpose of conducting a review under this Division, a review officer may do all or any of the following: (

a) take evidence either by affidavit or orally under oath, or both; This rule is permissive, not mandatory. Thus, it was well within the review officer’s jurisdiction to accept unsworn representations when he was obtaining the information concerning the details of the Agreement and the services that the Appellant provided to the Respondents: Rules r 10.17(1)(f). Had the Appellants wished to present their lengthy affidavits to the review officer during the review hearing, they could have sought leave so to do. They did not, so the review officer was left with the information and the oral submissions that each of the parties made during the review hearing. Furthermore, Rules r 10.17(1)(

f) does not say that the review officer must obtain this information under oath. Had the Legislature wanted this to be the case, it could have said so. VII. The Agreement

[ 25 ] The Agreement that the Appellants sent to the corporate Respondent is very general in its terms. Its subject line reads as follows: Retainer with Fraser Milner Casgrain (“FMC”) as legal counsel to Kristof Financial Inc. in regard to matters pertaining to Kurdistan The actual retainer portion of the Agreement says, “You have retained us to act on your behalf in connection with the above captioned matter.” In other words, it is a very general retainer. [ 26 ] In McDonald-Crawford v.

Morrow , 2004 ABCA 150 at para 8 , 28 Alta LR (4 th ) 62 (CA), Berger JA, quoting from Mark M Orkin, The Law of Costs 2 nd ed. (Canada Law Book, 1978), said: In all cases of an agreement respecting remuneration, there is an onus on the solicitor to take care that the client thoroughly understands not merely the terms but also the effect of such an agreement, otherwise it will be unenforceable . . . [ 27 ] Berger, JA went on to say, at para 11: Rule 613 factors apply to the taxation of a solicitor’s account absent any agreement as to fees, or when an agreement invokes or can be interpreted to invoke the Rule.

If a solicitor and his or her client have not agreed beforehand on what the solicitor’s charges will be, the solicitor is entitled to reasonable compensation on a quantum meruit basis, to be measured by the factors listed in Rule 613. Both the solicitor and the client can marshall the recited factors in support of their respective positions.

The rule to which Berger, J. was referring is similar (but not exactly the same as) Rules r 10.2(1), which provides: Except to the extent that a retainer agreement otherwise provides, a lawyer is entitled to be paid a reasonable amount for the services the lawyer performs for a client considering (

a) the nature, importance and urgency of the matter, (

b) the client’s circumstances, (

c) the trust, estate or fund, if any, out of which the lawyer’s charges are to be paid, (

d) the manner in which the services are performed, (

e) the skill, work and responsibility involved, and (

f) any other factor that is appropriate to consider in the circumstances. [ 28 ] The Agreement outlined the hourly rates that each of the lawyer who might be involved in this matter might charge. However, the Agreement is vague as to what each lawyers’ level of involvement would be or, for that matter, the firm’s level of involvement in the “matters pertaining to Kurdistan.”

[ 29 ] Thus, the review officer would be acting within his jurisdiction if he were to consider the factors outlined in Rules r 10.2(1) in his consideration of the reasonable compensation to which the Appellant was entitled. VIII. The Hearing Before the Review Officer [ 30 ] The review officer’s decision is contained in the Transcript.

The Transcript contains the arguments that each of the parties presented to the review officer, and was rife with interruptions on the part of Kristof, where he tried to clarify what the Appellant’s counsel was saying. [ 31 ] It is important to note that the Appellant’s lead counsel in this matter was not present at the hearing before the review officer. Kristof noted this very early on in the proceedings when he said “[the Appellant’s counsel] won’t even know the background”: Transcript p. 6, l. 5.

That said, it is clear to this Court that Appellant’s counsel had prepared extensively for this hearing by reviewing the account, and speaking with the lead counsel. [ 32 ] Kristof acknowledged many times throughout the hearing that he must pay something for the services that the Appellant rendered: see eg Transcript pp. 6, l. 27; 8 ll. 40-41. His main complaint was with the quantum of the account.

He felt that some of the work was not legal work, but an attempt by lead counsel to assist him in obtaining funding for his project through one of the Appellant’s other clients, in which one of the other partners had an interest.

As well, he was under the impression that lead counsel would attempt to minimize his role, because of lead counsel’s billable rate. [ 33 ] The relationship began to dwindle when the Respondent provided a retainer cheque that was less than the amount for which the Appellant had asked, and that was post-dated; to the point where the lead counsel hung-up on Kristof during a telephone conversation with him. The Respondent explained to the review officer that he had to raise the money to cover the retainer cheque.

The Appellant explained that the lead counsel hung-up the telephone on Kristof because “he reached his boiling point when trying to get this money, his team’s been working on this file, there are tight time constraints, they’re working quite busily”: Transcript, p. 23, ll.15-17. [ 34 ] Kristof claimed that the only things he instructed the Appellant to do was to prepare a joint-venture agreement and review an expression of interest. This does not accord with his comment that he wanted the Appellant on “stand-by” during his discussions with potential overseas parties: Transcript, pp. 30, ll. 24-25; 33, ll. 8-9.

He later confirmed this by responding in the affirmative to the Appellant’s counsel when she asked, “it was full representation and we were your counsel in all this and we could act in a manner that we thought necessary in order to provide for, you know, proper legal services”: Transcript p. 16, ll. 29-33. [ 35 ] Kristof also confirmed (and later denied) that the work that the Appellants performed was done on an urgent basis: Transcript p. 20, ll. 31-37. [ 36 ] With respect to the retainer itself, the Appellant’s counsel said that “if it was supposed to be limited the retainer agreement would’ve provided for that”: Transcript, p. 29, ll. 7-8.

But Kristof said that “I didn’t ask him to do all this”: Transcript, p. 30, l.1. [ 37 ] During the hearing, the Appellant’s counsel said: Now you say that you feel as though you didn’t get $20,000 worth of work done ... [T]hat’s something that is close to subjective. I can’t argue with you on that point. All I can say is that the statement of account, you know, it’s very comprehensively delineated the work done. The retainer agreement reflects the rates of the lawyers.

They took on this work short time frame, so very hard to do: Transcript p. 31, ll. 27-31. [ 38 ] As for the type of work, Appellant’s counsel said:

... [T]he statement of account discloses that there were a number of other undertakings on this matter including and limited to a joint venture agreement, some drafting of a confidentiality agreement, a review and revision of the expression of interest, and it also appears that there was a significant amount with [lead counsel] in trying to facilitate this startup capital with LBD: Transcript, p. 43, ll. 35-39. [ 39 ] As mentioned earlier, Kristof does not dispute that the Respondents had to pay something for the work the Appellants completed.

His main concern was that he was not aware of the work that the Appellant was undertaking. He said: And again, the reason I hired you guys is to have you there for what I hoped would transpire in the future. ... Not to do all this work ahead of time. A lot of this I feel this sort of stuff that was just done I wasn’t aware that there - - all these meetings and so on were happening on my behalf. Its - - that’s what I’m contesting here.

You know, I understand that a certain amount of money has to be paid for the time to draft the joint venture agreement and review the [expression of interest] and maybe for a few other meetings here and there. Transcript, p. 33, ll. 8-18. [ 40 ] In response, the Appellant’s counsel said: ... [I]t’s the retainer agreement that allows FMC to perform the work that they, you know, that they in their expertise believe you require based on the discussions that you had: Transcript p. 49, ll. 36-37. IX. The Review Officer ’s Decision [ 41 ] The review officer in this case rendered his decision in two-parts. The first

part consisted of his “comments” and the second, his actual decision. [ 42 ] The most telling statement that the review officer makes is, “Here there’s what appears to me some communication or lack of communication issues with fees”: Transcript p. 42, ll. 10-11. In almost all of the cases that go to taxation at the instance of a lawyer or the lawyer’s client, it is the lack of communication between the lawyer and the client that causes the dispute in the first place.

Had there been an open, and frank, discussion at the outset of the fees that the lawyers’ activities would entail, the parties would not be before the review officer, or this Court, for that matter. [ 43 ] The review officer reduced the Appellant’s account from $21,008.93 (inclusive of goods and services tax) to $15,000 (inclusive of goods and services tax): Transcript, p. 57, ll. 10-11.

In so doing, the review officer was cognizant of, and made reference to, the following: - the retainer agreement was “unlimited”: Transcript, p. 39, l.15-16 - the retainer agreement contained no estimates or ranges of the work that the Appellant was going to do: Transcript, p. 39, ll. 16- 17, 36-38; p. 41 ll. 20-25 - lead counsel was going to be working with a “team” of more junior lawyers: Transcript, p. 39, ll. 36

- because he would be working with a “team,” lead counsel would minimize his time: Transcript, p. 39, ll. 40-41 - lead counsel’s time made up over 60% of the final invoice: Transcript, pp. 39, l. 41; 40 l. 1 - there was some urgency to the work that the Appellant had to provide to the Respondents: Transcript, pp. 40, l. 40; 41 ll. 27-28,37-39; 57 l.12 Thus, he considered the evidence and the representations that the parties made to him. The quantum at which he arrived was the result ofhis “balancing” these factors: Transcript, p. 57. [44] The Transcript supports these findings.

Thus, this Court will not disturb them, as the review officer did not commit an error inprinciple by making findings of fact that were clearly in error: Carter, supra. [45] Was he wrong to rely on unsworn evidence? Rules rr. 10.17(1)(

a) and 10.17(1)(

f) are permissive. Rules r 10.17(1)(

f) does notsay that the review officer must require him to seek details under oath of a retainer agreement, or of the services provided, to determinewhether the agreement or charges are reasonable. The Alberta legislature could have made this a requirement. In fact, it is interesting tonote that this provision did not exist in the former rules of court: Old Rules r 628. Under the Old Rules courts held that a taxation officer,as that position was then known, could, as part of their duties, “hear the evidence, examine material, make decisions on credibility andweight”: Condominium Plan No. 911945 (Owners) v.

Zavislake, 1998 ABQB 160 , 1998 CarswellAlta 141 at para 11, 215 AR355 (QB); 509703 at para 19. In Brown at para 17, Acton, J. found that the taxing officer was entitled to weigh the evidence and makefindings of credibility. The addition of Rules r 10.17(1)(

f) codifies what the courts had already found a review officer could do. [46] Rules r 10.17(1)(

a) does not conflict with this “entitlement.” It merely allows the review officer to take evidence by affidavitor under oath. It is not difficult to imagine when that might be required, such as when the parties are diametrically opposed with respectto certain aspects of the retainer. The whole idea behind the process of reviewing lawyers’ fees is to “give clients a simple andinexpensive procedure to have lawyers’ accounts assessed independently”: Consultation Memorandum 12.17 at 31.

A court-likeproceeding, with everything being placed before the review officer under oath does not lend itself to such a process. [47] Furthermore, the review officer, in this case, accepted unsworn evidence of both parties orally and based his findings on thatunsworn evidence. If the Appellants are arguing that the review officer made findings based on an incomplete record, they should havepresented that record before the review officer; not the court hearing the appeal. The lead counsel (or his subordinates) did not appear atthe hearing before the review officer.

It was a person from the Appellant’s litigation department, who had no information about thismatter, other than what she gleaned from the lead counsel. Many times throughout the hearing the Appellant’s counsel was surmising oncertain aspects of the retainer, with phrases such as “it seems to me,” “it appears,” “its strikes me” and similar phrases. These would nothave been suppositions had lead counsel (or at least one of his subordinates) been present at the hearing before the review officer.

Infact, Kristof drew this to counsel’s attention when he said “where I kind of have an issue is the specifics because you weren’t there [sic.]of what transpired”: Transcript p. 29, ll. 27-28. [48] The Appellants also argue that the review officer erred when he failed to “refer questions of the terms and scope of theRetainer Agreement to the Court.” It cites Rules r 10.18(1)(a). That provision says that a review officer “must refer any question arisingabout the terms of a retainer agreement to the Court for a decision or direction.” Unlike the option contained in Rules r 10.17(1), thisprovision is mandatory.

This provision is in keeping with cases such as Panther Petroleum at para 16, where Rooke J, as he then was,said that a taxing officer has “no jurisdiction to determine the terms of a retainer agreement.” It should be noted, as well, that Rules r10.18(1)(

a) does not refer to the “scope” of the retainer agreement; only its terms. “Scope” refers to the breadth of the retainer agreement, assuming that its terms are clear. The Concise Oxford Dictionary, 6th ed, sub verbo “term” defines “term” as meaning, amongother things, “conditions, stipulations.” Thus, if questions arise concerning the retainer agreement itself, or its contents, the reviewofficer must refer that question to the court.

The “scope” of the retainer might be included in a question, but not necessarily so. [49] The question in this case involves the review officer’s acceptance of Kristof’s evidence that he did not feel that he was payingfor certain meetings involving the lead counsel and one of the Appellant’s other clients. The Agreement provides: You acknowledge that [one of the Appellant’s partners] is a principle [sic.] of LBD Energy, and that LBD Energy is a client of FMC, and

that that nevertheless, you consent to our representation of you in connection with LDB Energy, provided that we do not advise LBD Energy in regard to this matter. Please obtain independent legal advice in this connection. [ 50 ] In the mind of the review officer, could there be a question arising out of this term in the Agreement, with which the Court could assist? The Appellant asked the Respondents to “consent to our representation of you in connection with LDB Energy.” Rules r 10.17(1)(

f) allows the review officer to “require details of ... any other matter necessary to understand the agreement or charges ...” The Appellant’s counsel and Kristof made submissions concerning the situation involving LBD: see eg Transcript pp. 43, ll. 38-39, 44, ll. 1- 9; 45, ll. 13-41, 46, ll. 1-24. In other words, the review officer was doing what Rules r 10.17(1)(

f) permitted him to do. The review officer obtained that information. He then said: ... Kristof feels it wasn’t, it wasn’t part of the legal services. It’s part of the work the [firm] did but it’s a bit odd here that apparently not only is the other company a client of the firm but one of the members of that LBD group is apparently a partner in the firm ... So when it’s actually a company that a member of the firm is personally involved in I guess I put a bit more weight on Mr. Kristof’s comment that he didn’t feel it was part of the billable legal work being provided Transcript, p. 40, ll.13-15, 24-26.

He then goes on: And there’s Mr. Kristof’s evidence that in his mind the work associated with LBD should not be characterized as billable as legal services. ... [T]he LBD entity is actually a client of the firm and has as a principal one of the partners in the firm. So it’s probably a little more understandable that in many situations that Mr.

Kristof might view that as a courtesy to him and not as billable legal service: Transcript p. 57, ll.19-24. [ 51 ] Thus, the review officer was doing what Acton, J. found that the taxing officer was entitled to do, which was to weigh the evidence and make findings of credibility: Brown at para 17 . [ 52 ] Another confusing part of that portion of the Agreement is the Appellant’s instruction to the Respondents to “obtain independent legal advice in this connection.” If, indeed, the Appellant was providing the Respondents with legal services, why would they have to obtain independent legal advice on this?

We must remember that the onus is on the solicitor to “take care that the client thoroughly understands not merely the terms but also the effect of such an agreement”: Morrow Crawford , supra . [ 53 ] In the end, the review officer was obtaining details of or, more accurately, clarifying the Agreement, or of the services provided under it. There was no question or direction he needed from the court and, accordingly, he did not err when he did not refer a question to the court. [ 54 ] Finally, this Court finds that the award that the review officer made was not inordinately high or low.

Accordingly, he did not commit an error on principle on that basis. X. Conclusion [ 55 ] This Court wants to make it clear that it is not criticizing the Appellant’s counsel concerning her presentation of the Appellant’s position at the hearing before the review officer. Quite the contrary. She did an excellent job of presenting argument with the information she had.

[ 56 ] This Court dismisses the Appellant’s appeal. Heard on the 22 nd day of May, 2012. Dated at the City of Calgary, Alberta this 29 th day of May, 2012. K.D. Yamauchi J.C.Q.B.A. Appearances: Heather Currie and Frank Alexander (Fraser Milner Casgrain LLP) for Appellant Frederic Kristof for himself and the corporate Respondent