BA Capital Inc. v. Focused Money Solutions Inc., 2012 ABQB 379

Court of Queen ’ s Bench of Alberta Citation: BA Capital Inc. v. Focused Money Solutions Inc., 2012 ABQB 379 Date: 20120607 Docket: 1001 04100, 1001 05493 Registry: Calgary Between: BA Capital Inc. and Art Agolli Plaintiffs - and - Focused Money Solutions Inc. and Victor Delaet Defendants And Between: Action No. 1001 05493 FM Energy Inc. Plaintiff - and - Art Agolli Defendant And Between: Art Agolli Plaintiff by Counterclaim

- and - FM Energy Inc. and Victor Delaet Defendants by Counterclaim _______________________________________________________ Memorandum of Decision of K.R. Laycock, Master in Chambers _______________________________________________________ [ 1 ] The Alberta Rules of Court provides a method for a review of the reasonableness of legal accounts.

Pursuant to Rule 10.10 (2) “A lawyer’s charges may not be reviewed if 6 months has passed after the date on which the account was sent to the client.” [ 2 ] The plaintiffs in this action are the applicants who request leave to have the accounts of their solicitors, Bennett Jones, reviewed after the passage of the 6 month period has passed. The grounds for the application are stated to be “overcharged, misled on legal strategy.

It was part of one file and the case was ongoing until a few months ago and did not want to jeopardize the case.” The applicant filed the application in the litigation giving rise to the legal bills rather than filing an originating document. The respondent law firm did not object to the process and the application proceeded. [ 3 ] In support of the application Mr. Agolli has sworn an affidavit which states: I requested the Master today to allow a review of the bills that were older than 6 months.

Master noted that since some bills were older than 2 years I need to serve the lawyers to let them know that I am requesting to review the bills that are older than two years old since it is one ongoing file.

Please see exhibit A that has the bills that want reviewed. [ 4 ] The account summaries are as follows: March 19, 2010 totals $3,008.10, April 7, 2010 totals $4,519.18, May 6, 2010 totals $2,510.14, August 6, 2010 totals $1,289.82, December 31, 2010 totals $18,323.63. [ 5 ] Counsel for the respondent advises that the last payment on this series of bills occurred on April 8, 2011. [ 6 ] The applicant advised in court that he always had a concern about the size of the legal accounts and at some point requested more junior counsel take over the file to reduce his fee exposure.

He expressed frustration that junior counsel continued to have the matter reviewed by senior counsel so that he ended up paying for two lawyers rather than one. He indicated that he had concern about the work being performed on his behalf but felt he could not change law firms because the firm had recommended, and was pursuing, a

summary judgment application. To change law firms would mean that the new firm would have to review the entire file in order to prepare for the

summary judgment application. When the

summary judgment application was lost, he terminated the legal services contract.

[7] The law firm has not filed in the affidavit and opposes any extension of time for a review of their legal accounts. [8] In this application the first consideration is whether or not the applicants can satisfy me that they have a reasonable excusefor failing to bring the disputed accounts before a Review Officer within six months of the bill being delivered. In the case of a series ofinterim accounts, it is the date of the delivery of the final bill that is material. See Baxandall v.

Peterson Hustwick Wetsch & Moffat(1994), (AB KB), 154 A.R. 353 (Q.B.). [9] In this case the applicant has provided no evidence in his affidavit to explain the 16 month delay following the final accountin bringing this application or when he became concerned about the size of the account or the performance of the law firm.

Anexplanation for his concern about the size of the account and the performance of the law firm was given during argument, but that is notevidence. [10] If a reasonable explanation is provided to the court to explain the delay in bringing the accounts to a Review Officer, then thecourt must consider whether or not there’s any evidence of prejudice to the law firm in bringing the matter forward. While there is noevidence of prejudice, the question of prejudice never arises in this matter because there is no explanation given for the delay in bringingthe accounts before the Review Officer. [11] In Twinn v.

Saw Ridge Band, 2012 ABQB 44 Justice Browne referred to the decision in P & S, Barristers & Solicitors v.Legal Aid Society, (AB KB), [1994] 164 AR 208 (QB) and concluded that the reasons for a solicitor bringing anaccount to taxation are fundamentally different than the reason for taxation by a client. At paragraph 38 Justice Browne stated: The six month time limit for client-initiated reviews make sense for many reasons. Clients will almost always be aware of any concernsthey may have about lawyer’s fees within six months of receiving the final account.

Client-initiated reviews put lawyers on notice that aclient has concerns. The time limit encourages clients to voice concerns close to the date they arise. This makes it easier for all parties(including the Review Officer) to resolve the disputes. This also allows lawyers to anticipate uncollectible receivables within areasonable period of time. [12] At a minimum, the evidence that an applicant must bring is why there was a delay in bringing the issue to a Review Officer.In many of the applications that we hear, the clients affidavit expresses a lack of knowledge of the process.

They have paid the accountand have no knowledge that the account can be reviewed. If the file is incomplete when the solicitor-client relationship terminates, it isoften the clients second law firm that advises the client of the right to have the account reviewed. [13] In Oilexco Inc. v. MacKimmie Matthews (AB KB), 1997 CarswellAlta 415, 203 A.R. 213, 12 C.P.C. (4th) 352, 52 L.R. (3rd) 412 a third party who, pursuant to an agreement, was liable for the payment of another’s legal account did notobtain copies of accounts until after the time for their review had passed.

Their explanation for the delay in bringing the applicationbefore the then Taxation Officer (now Review Officer) was accepted. Given the circumstances it was determined that there was noinordinate delay in bringing the matter forward. There was no evidence of prejudice to the law firm and the matter was allowed toproceed to taxation. [14] Since there is no adequate evidence explaining the delay, the application for leave to have the accounts reviewed isdismissed. Heard on the 10th day of May, 2012. Dated at the City of Calgary, Alberta this 7 day of June, 2012.

K.R. Laycock M.C.C.Q.B.A. Appearances: Art Agolli for the Applicants Kelsey J. Drozdowski Bennett Jones LLP for the Respondent