Koopmans v Joseph, 2014 ABQB 721

Court of Queen ’ s Bench of Alberta Citation: Koopmans v Joseph, 2014 ABQB 721 Date: 20141127 Docket: 1303 10337 R egistry: Edmonton Between: Johannes Koopmans also known as Joe Koopmans Appellant/Respondent - and - Robert S. Joseph and Prowse Chowne LLP Respondents/Applicant ____________________________________________________ Reasons for Judgment of the Honourable Madam Justice S.J. Greckol ____________________________________________________ I. Introduction [ 1 ] Mr. Koopmans brought an appeal from the decision of the Small Claims Court judge who dismissed his Civil Claim against a lawyer and his law firm.

In my decision (“the judgment” 2014 ABQB 395 ), I concluded (at paras 124-129): [124] The appeal is allowed. The learned trial judge erred in the following ways: refusing to grant Mr. Koopmans an adjournment to find an expert witness to testify about the timeliness of the commencement of negotiations with Penn West, his analysis regarding whether a request to delay the decision of the ERCB would have been granted, and his analysis regarding the prospect of settlement in these circumstances, if any. He then found against Mr. Koopmans on the latter two grounds because of an absence of expert evidence.

Since this error goes to the heart of the judge’s decision, it cannot stand and the appeal is allowed.

[125] Legal services were not provided by the defendants in a timely and cost effective fashion given a contextual analysis of the facts. Mr. Koopmans sought damages consisting of the return of his legal fees in the amount of $4,254.23. Mr. Koopmans is awarded $4,254.23 in damages for negligence, in other words, the return of his legal fees charged by Mr. Joseph. [126] The Provincial Court Act, s 52 provides that this Court may make any order that it considers proper in respect of costs. Costs generally follow the cause. Although Mr. Koopmans was self-represented, he had counsel at the

summary judgment application and was successful. Therefore, he is entitled to the $500 ordered against the defendants by the judge who heard the

summary dismissal application. [127] Mr. Koopmans had the assistance of counsel in preparation for trial and appeal. Mr. Koopmans was directed to pay costs in the amount of $5,444.46 for the two-day trial of this action and that costs award is vacated. That amount is a measure of the appropriate costs of trial in provincial court. He is awarded $5,000 for the two day trial as he had legal assistance and an expert witness retained who was in attendance one day of the trial. [128] This appeal also took two days. I think it is fair to award Mr.

Koopmans $5,000 in costs for this appeal given the extensive amount of time he obviously spent in preparation with some assistance from counsel. [129] In

summary, Mr. Koopmans is entitled to $4,254.23 in damages for the return of legal fees. He is also entitled to $500 for the

summary judgment application that he has already been awarded, $5,000 for the trial and $5,000 for this appeal. In addition, just as the defendants were, he is entitled to any expenses he can authenticate, such as parking, costs of filing the notice, costs of the transcripts of trial and transcripts of the taxation hearing. [ 2 ] The Applicants (Respondents to the appeal) now apply for certain changes to the decision relying on Rules of Court 9.12 and 9.13. II. Issues [ 3 ] There are four issues raised in this application:

a) Is the application under Rule 9.13 timely?

b) Was the decision to return legal fees a collateral attack on the Review Officer`s decision to reduce the legal bill?

c) Is Mr. Koopmans, as a self-represented litigant, precluded from receiving a costs award?

d) Can the amount of the award for legal fees be reduced from $4,254.23 to $3,654.00 under Rule 9.12? III. Legislation – Alberta Rules of Court , AR 124/2010 A. Changing Judgments Before and After Entry [ 4 ] The following Rules bear on the issues in this application: 9.12 On application, the Court may correct a mistake or error in a judgment or order arising from an accident, slip or omission. 9.13 At any time before a judgment or order is entered, the Court may (

a) vary the judgment or order, or (

b) on application, and if the Court is satisfied there is good reason to do so, hear more evidence and change or modify its judgment or order or reasons for it. 9.5(1) Subject to subrule (2), every judgment and every order is entered by filing it with the court clerk, who must make a note in the Court file of the entry and the date of the entry. B.

Review Officer’s Powers Conducting a Review [ 5 ] A review under Rule 10.9 by a review officer involves the officer making a decision concerning a dispute between a lawyer and her client concerning an account, initiated by either the lawyer or the client: 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. 10.19(1) A review of a lawyer’s charges must take into consideration the factors described in rule 10.2 [Payment for lawyer’s services], except to the extent that a retainer agreement otherwise provides. 10.2(1) 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. C.

Assessment Officer’s Powers Conducting an Assessment [ 6 ] An assessment under Rule 10.36 involves an assessment by an assessment officer making a decision concerning a dispute between two litigants when it becomes the responsibility of one party to pay the costs of the other and there is a dispute as to the Bill of Costs: 10.36(1) After a judgment or order has been entered, an assessment officer, in accordance with any Court direction or order, may make an assessment of costs payable in accordance with 10.41 . . . 10.41(1) Subject to an order, if any, an assessment officer may, with respect to an assessment of costs payable, determine whether the costs that a party incurred to (

a) file an application, (

b) take proceedings, (

c) carry on an action, or (

d) participate in an action, application or proceeding, are reasonable and proper costs. . . .

(3) In making an assessment under subrule (1) and taking into account the conduct of the parties, the assessment officer . . . (

b) may disallow an item in a bill of costs that is improper, unnecessary, excessive or a mistake . . . (

f) may, in exceptional circumstances, reduce an amount, or allow a fraction of an amount, if the services were incomplete or limited. D. Costs for Self-Represented Litigants [ 7 ] Costs for self-represented litigants are permitted: 10.31(5) In appropriate circumstances, the Court may order, in a costs award, payment to a self-represented litigant of an amount or part of an amount equivalent to the fees specified in

Schedule C [ Tariff of Recoverable Fees ]. IV. Analysis A. Is the Application Under Rule 9.13 Timely? [ 8 ] The Applicants rely on Paniccia Estate v Toal , 2012 ABQB 11 , 521 AR 73, but do not make any submissions on how this case applies to their application. In Paniccia, Shelley J. identifies the benefits of Rule 9.13 and notes that it gives judges broad authority to vary judgments before entry. The Applicants claim that the judgment has not been entered. [ 9 ] Mr. Koopmans submits that the judgment was entered on June 26, 2014 when the written reasons were issued and filed.

Consequently, the Court cannot vary it under Rule 9.13. [ 10 ] In Paniccia , Shelley J. considered a Rule 9.13 application concerning a paragraph in her reasons for judgment. In considering the application, she noted that Rule 9.13 gives a broad authority to vary a judgment that did not exist under the old Rules. After noting the benefits of Rule 9.13(a), at para 39, Shelley J. stated: Here I act on my own authority, which I conclude is only restricted by the purpose of the Rules , as expressed in Rule 1.2.

If I conclude that paragraph 47 is incorrect, and that revision of that part of the Trial Decision meets the objectives of the Rules , then I am permitted, if not obliged, to revise the Trial Decision accordingly. She concluded that the paragraph in question contained an incorrect statement of law and used her authority under Rule 9.13(

a) to vary the paragraph. [ 11 ] In Lewis Estates Communities Inc v Brownlee LLP , 2013 ABQB 731 , [2013] AJ No 1394, Brown J. (as he then was) considered a Rule 9.13(

a) application. At paras 22-26, he explored the differences between Rule 9.13(

a) and (

b) and whether there is a difference between the “vary” of Rule 9.13(

a) and the “change or modify” of Rule 9.13(b), as he was concerned that Rule 9.13(

b) narrows the scope of what can be done under Rule 9.13(a). Without resolving this issue, Brown J. decided that even when an applicantmeets the threshold, judges reserve discretion to choose whether a judgment should be varied (at paras 29-33). [12] To complement the reasons Shelley J. provided for granting the Rule 9.13(

a) application in Paniccia, Brown J. pointed out inLewis Estates that to do so could undermine finality and certainty, and that the Rule 1.2 objectives of fairness and cost effectivenesscould just as easily weigh against granting a Rule 9.13(

a) application (at para 32). Rule 9.13(

a) should not be used to seek areconsideration of a judgment since the only remedy for that lies in an appeal (at para 33). To ward against this, Brown J. set a highthreshold for Rule 9.13(

a) applications at para 34: the evidence and law put before the Court ought to make an applicant’s case so compelling that the likelihood that it has correctlyidentified an error is very high. This is, I note, essentially the test for obtaining

summary judgment. In the end, Brown J. decided that the applicant had not supplied sufficiently compelling reasons for him to exercise his discretion to varyunder Rule 9.13(a). [13] In Chutskoff v Bonora, 2014 ABQB 628, [2014] AJ No 1159, the reasoning in Lewis Estates was adopted and applied todeny an application to vary. [14] Mr. Koopmans correctly points out that for Rule 9.13(

a) to be invoked, the judgment must not yet be “entered”. Rule 9.5seems to distinguish between “filing” and “entry” in that “entry” involves the actual act of the clerk making a note in the Court file. Inthis case, reasons for judgment were filed and entered on June 26, 2014. Here, the application was filed on July 21, 2014. If “judgment”in Rule 9.13 means “written reasons,” then Mr. Koopmans would be correct and the application to vary is not timely and cannot succeed. However, “judgment” in Rule 9.13 likely does not mean “written reasons,” but, rather, the formal judgment that must be filed within 3months after pronouncement under Rule 9.5(2). This is the

interpretation of the Rule provided by Graesser J. in Evans v The SportsCorporation, 2011 ABQB 478, 523 AR 80, where he said the following: The formal judgment had not been finalized and entered, and as a consequence I retain a broad jurisdiction over the matter. Myjurisdiction includes the correction of errors and extends beyond just typographical or calculation errors. [15] In Evans, written reasons had already been filed (see 2011 ABQB 244, 523 AR 22), yet Graesser J. retained jurisdiction underRule 9.13 to vary the judgment because the formal judgment had not been entered by the time the application was made.

Similarly in thiscase, the formal judgment roll has not been entered and so I retain authority under Rule 9.13 to consider this application on its merits. B. Was the Decision to Return Legal Fees a Collateral Attack on the ReviewOfficer’s Decision of October 23, 2012 to Reduce the Legal Bill? [16] The Applicants argue that an award of the return of legal fees is a collateral attack on an “Assessment Officer’s” order.

Insupport, the Applicants point to the old Rule 635, which gave the taxing officer authority to “refuse to allow the costs of all or any part ofproceedings that were. . . taken through over-caution, negligence or mistake.” [17] The Old Rule 635 provides: 635(1) The taxing officer may refuse to allow costs which are excessive having regard to the circumstances of the matter, including itsnature and the interests and amounts involved.

(2) The taxing officer may refuse to allow the costs of all or any part of proceedings that were (

a) improper, vexatious, prolix or unnecessary, or (

b) taken through over-caution, negligence or mistake. [18] The Applicants suggest that the New Rules reflect the same spirit concerning Reviews.

Under Rule 10.41(3)(b), the ReviewOfficer has the ability to “disallow an item in a bill of costs that is improper, unnecessary, excessive or a mistake” and in Rule 10.41(3)(f)to, “in exceptional circumstances, reduce an amount, or allow a fraction of an amount, if the services were incomplete or limited.” [19] The Applicants cite Wilson v Queen, (SCC), [1983] 2 SCR 594, at 604 for the definition of a collateralattack: “an order of a court which has not been set aside or varied on appeal may not be collaterally attacked and must receive full effectaccording to its terms.” They argue that the Review Officer already reviewed the legal bill and chose to reduce rather than eliminate it;this decision was not appealed.

Since the Review Officer was able to consider negligence in reducing the bill, and this Court’s decision toreturn legal fees to Mr. Koopmans concerns negligence, it is effectively a collateral attack and impermissible. The Applicants argue thatRule 9.13 should be used to vary the judgment in order to recognize that the issue of negligence as it relates to legal fees has already beendecided by the Review Officer. [20] Mr.

Koopmans submits that this argument must fail since the judgment addressed the Review Officer’s decision and foundthat the Officer decided only an issue of quantum, whereas the judgment decides an issue of negligence (at paras 50-54). Consequently,the decision to return legal fees is not a collateral attack on the earlier decision, which is intact and was not disturbed by the judgment.Mr.

Koopmans points out that the Applicants have not argued anything in their application that addresses or undermines the distinctiondrawn in the judgment between a Review Officer’s consideration of quantum and the issue of negligence on the appeal. [21] I agree with Mr. Koopmans that the judgment itself (at paras 50 – 54) distinguishes between the issue of negligenceconsidered on this appeal; and the issue of quantum of legal fees considered by the Review Officer. There are several problems with theApplicants’ argument.

[ 22 ] First, the Applicant points to Rule 10.36(1) and Rule 10.41 as the basis for the authority to conduct an assessment, but does not consider the distinction between an “Assessment” and a “Review” under the Rules. The Rules cited by the Applicant are only relevant for an Assessment of a taxable bill of costs – a procedure addressing a dispute between successful and unsuccessful parties. However, in this case, the October 23, 2012 decision by the Review Officer was based upon a review of a retainer agreement.

Such a review is conducted by a Review Officer under Rules 10.9, 10.19(1), and 10.2(1) and involves different considerations. None of these rules authorizes the Review Officer to make findings of negligence and, therefore, cannot properly concern the same subject matter as the question of negligence in the judgment. [ 23 ] The change in language between the Old and New Rules must be taken to have clarified that the Review Officer does not have authority to determine whether the case involves lawyer negligence in the formal legal sense of that term.

The decision in Repchuk v Silverberg , 2013 ABQB 305 at paras 29 and 82 , 563 AR 245, affirms that Review Officers have no authority to make findings of professional negligence, and Steinke v Hajduk Gibbs LLP , 2014 ABQB 34 at para 63 , 96 Alta LR (5th) 155, says that Reviews cannot be taken as an invitation to Review Officers to second guess counsel. [ 24 ] Second, it is clear the Review Officer did not actually consider or address lawyer negligence.

There has been no collateral attack of his decision in the judgment; it remains a review of the quantum of the legal fees whereas the judgment turns on a finding of lawyer negligence. [ 25 ] The decision in Lewis Estates sets out a threshold that the Applicants must meet in a Rule 9.13(

a) application. They have failed to meet this threshold: they have not shown a very high likelihood of error in the judgment. C. Costs for Self-Represented Litigants Can be Awarded [ 26 ] In the judgment, at paras 126-128, I ordered costs in the sum of $10,000.00 payable to Mr. Koopmans. The Applicants argue that such an award is prohibited by Hogarth v Rocky Mountain Slate Inc , 2013 ABCA 116 , 87 Alta LR (5 th ) 108.

The Court in Hogarth writes that “a self-represented litigant should generally not receive costs unless that would serve one of the policy reasons for which costs awards are made” (at para 9). [ 27 ] The Applicants suggest that Mr. Koopmans incurred only minimal expenses in this litigation because he did not have counsel at either the Provincial Court trial or at the Court of Queen’s Bench appeal and, therefore, the policy reasons mentioned in Hogarth do not apply.

Further, the costs award did not relate to a settlement offer, was not awarded to encourage litigation efficiency, and was not awarded for indemnity reasons – the primary purpose of cost awards. For these reasons, the Applicants argue that the costs award should be varied using Rule 9.13. [ 28 ] Mr. Koopmans submits that the costs award of $10,000 is entirely within this Court’s discretion and defends the award of costs. Mr. Koopmans agrees that the purpose of a costs award is to indemnify the successful party, and argues that he has incurred significant costs warranting indemnification. As evidence, Mr.

Koopmans submitted invoices from counsel with whom he consulted, amounting to $6,472.38. Mr. Koopmans requests a further costs award because he has now incurred more expense for this application. [ 29 ] Relying on LL v GB , 2009 ABQB 322 , 455 AR 388, Mr. Koopmans argues that it is appropriate to award costs to self- represented litigants to indemnify them for the time and effort exerted beyond what would have been incurred had counsel been retained for the entire matter. Mr. Koopmans submits that he has devoted countless such hours to this litigation and, consequently, the original award was appropriate. Mr.

Koopmans also points out that Mr. Joseph has placed a lien against his property. He asks that this Rule 9.13 application be resolved as soon as possible so that he can take steps to have the lien removed. [ 30 ] In LL , a mother applied successfully for retroactive child support. The unsuccessful party argued that she should not be entitled to costs because, as a self-represented litigant, she only incurred minor disbursements. Graesser J. noted at para 44 that costs are always in the discretion of the Court and discussed several cases dealing with costs for self-represented litigants (at paras 44-61).

At para 67, he provided a

summary of principles arising from the case law: 1. There is no automatic rule entitling a self-represented litigant to costs. While there is a presumption in favour of awarding costs on a party and party basis to a successful represented litigant, a self-represented litigant bears a stronger onus of establishing an entitlement to costs; 2. In determining entitlement, the Court should have regard to the factors set out in Dechant ; 3.

To achieve fairness, a self-represented party's time is a minor factor in the consideration of costs, and then only to the extent that the self-represented party has spent more time on the matter than one would expect a represented party to have spent. 4. The Court's discretion should be exercised after an analysis of the Dechant factors; 5. Only after the Court has exercised its discretion in favour of awarding cost to a self-represented litigant should the Court determine the quantum of costs; 6.

Schedule C is a guide to determining quantum, but the Court may exercise a discretion to award a lump sum, or all or a portion of

Schedule C costs; and 7. The Court should try to avoid turning the assessment of costs into a further trial. [ 31 ] At para 53, Graesser J. summarized the factors in Dechant v Law Society of Alberta , 2001 ABCA 81 , 277 AR 333: 1. Lost opportunities of the litigant as a result of self-representation, for example lost time from work (proof of the exact value

is not required, otherwise there would be another trial just on costs); 2. The particular facts of the case: a. Was the matter complicated? b. Was the work of good quality? c. Did self-representation cause delays? d. Did the self-represented litigant take up unreasonable amounts of time by the opposing parties or the courts? e. What is the lost opportunity of the self-represented litigant? f. Did the other side take advantage of the fact that the litigant was unrepresented by taking unnecessary or frivolous steps? g. Did the other side refuse to consider reasonable requests to discuss settlement? h.

What is an appropriate amount given the issues involved, including all the factors in R. 601? [ 32 ] In LL , the successful self-represented party spent countless hours on research, court attendances, preparing and reviewing documents and preparing her case. Applying the Dechant factors to her, Graesser J. awarded costs to her, but on a lump sum basis rather than full

Schedule C costs (at para 76). [ 33 ] The Court of Appeal considered costs for self-represented litigants in Hogarth . At para 8, the Court noted that the “primary purpose of a costs award is to partly indemnify the successful party for costs of the litigation.” Since self-represented litigants do not pay lawyers to represent them, a costs award will normally result in a windfall to them. Further, drawing on comments made in Dechant , the Court noted at para 9 that “self-represented litigants do not necessarily bear a greater personal burden” than litigants who have retained counsel.

These considerations led to the general rule relied upon by the Applicants that “a self-represented litigant should generally not receive costs unless that would serve one of the policy reasons for which costs awards are made” (at para 9). In Dechant , there was no indication that the self-represented litigant exercised any special skill or that he was burdened any more than a represented litigant (at para 10). Accordingly, costs were denied to the self-represented litigant even though he was successful. [ 34 ] The Applicants suggest that Hogarth precludes an awarding of costs to self-represented litigants.

However, Hogarth states only that generally, self-represented litigants will not be awarded costs. Ultimately, as both Hogarth and LL suggest, judges must make determinations on a case-by-case basis, applying the principles identified in Dechant . [ 35 ] Mr. Koopmans has provided a record of the invoices he has received and paid to lawyers who assisted him with the various applications, the trial, and the appeal. It is common knowledge that litigants often cannot afford legal fees for litigation.

Hence, there has developed a practice where legal services are unbundled so that lawyers provide only partial services to assist the litigant to advance the case. That is what occurred here; it is only fair to reimburse the litigant for those costs. [ 36 ] In addition to the legal work provided to Mr. Koopmans on a piecemeal basis, he spent hours preparing and arguing the case, a case that, as I noted many times during the hearing, was one that would likely have settled, had Mr. Koopmans’ concerns about the services rendered and the last account been addressed. The matter was not simple and Mr.

Koopmans worked hard to explain it thoroughly to the Courts. A great deal of time was required. In my view, this case falls within the principles established by Dechant and LL, and I am satisfied that the award of costs was warranted. Costs for self-represented litigants are specifically allowed by Rule 10.31(5). D. The Correct Amount of the Legal Bill [ 37 ] Finally, the Applicants argue that the correct amount of legal fees returned to Mr. Koopmans should be $3,654.00 and not $4,254.23 as indicated in the judgment. On October 23, 2012, a Review Officer reduced Mr.

Joseph’s legal bill to $3,150.00 (including GST). When combined with the remainder of the first retainer in the amount of $504.00, the correct amount of damages is $3,654.00. [ 38 ] Mr. Koopmans agrees with the Applicants that the return of legal fees should be for $3,654.00 and suggests that this change be made under Rule 9.12. I therefore direct that the amount of damages (based on cost of legal services) be reduced from $4,254.23 to $3,654.00 as agreed by the parties. VI.

Conclusion [ 39 ] In the final analysis, I conclude that the Applicants’ arguments amount to a request for reconsideration of my entire judgment. The Applicants have launched substantive arguments that contest the express conclusions drawn in the judgment in a way that cannot be properly addressed without a formal appeal. However, no appeal is available, and with good reasons: our Courts do not have the resources for the litigation of Small Claims Court cases beyond one level of appeal. [ 40 ] This application is not properly advanced under Rule 9.13 and is therefore dismissed. Additional costs incurred by Mr.

Koopmans for this application are already sufficiently recompensed by the existing costs award, so there is no additional order for costs. [ 41 ] The amount of damages as corrected is $3,654.00. Costs in favour of Mr. Koopmans are affirmed in the sum of $5,000.00 for the conduct of the trial and $5,000.00 for the conduct of the appeal, including the present application.

By written submissions filed July 21, 2014 and October 17, 2014. Dated at the City of Edmonton, Alberta this 26 th day of November, 2014. S.J. Greckol J.C.Q.B.A. Appearances: Johannes Koopmans Self-represented Party Derek Hopfner Emery Jamieson LLP for the Respondents/Applicant