Miles Davison LLP v Rennich, 2021 ABQB 1019

Court of Queen’s Bench of Alberta Citation: Miles Davison LLP v Rennich, 2021 ABQB 1019 Date: 20211222 Docket: 2001 11108, 2001 11794 Registry: Calgary Between: Miles Davison LLP Applicant - and - Laurel Christine Rennich Respondent 2001 11794 And between: Laurel Christine Rennich Applicant/ Respondent on Appeal -and Peter Leveque, Lauren Turnquist and Miles Davison LLP Respondents/ Appellants on Appeal

_______________________________________________________ Memorandum of Decision of the Honourable Madam Justice C.L. Kenny _______________________________________________________ Appeal from Taxation Decision by D.M. Ellery on January 6, 2021 Introduction [ 1 ] This is an appeal of a Review Officer’s Decision. Laurel Christine Rennich (Ms. Rennich), made an appointment for the Review of a Retainer Agreement/Lawyer’s Charges with respect to an account rendered by the Appellants herein.

The Appointment was filed October 1, 2020, in action number 2001-11794. [ 2 ] The Appellants filed an Amended Appointment for Review of Lawyer’s Charges on October 21, 2020, in action number 2001-11108. [ 3 ] The same retainer agreement and legal fees are under assessment in both actions. [ 4 ] On October 29, 2020, Ms. Rennich filed a new action against the Appellants raising issues of negligence in their legal representation of her interests: action number 2001-13143. [ 5 ] The Review Officer heard the matter on January 6, 2021.

He determined that the review process could not go ahead until the issues of negligence, raised in the Statement of Claim, had been dealt with either by trial or by resolution. [ 6 ] The Appellants seek an order:

i) Referring the matter back to the Review Officer; ii) Referring the assessment to another review officer; or iii) Requesting a Justice to substitute their own decision for the Review Officer’s assessment. Background [ 7 ] On March 1, 2015, the Respondent Ms. Rennich, retained the Appellants to provide various litigation related services in action number FL01-21880, in which Ms. Rennich was the Plaintiff. The Respondent signed a Contingency Fee Agreement wherein the Appellants would accept a contingency fee of 33 1/3 – 40%.

The Agreement also provided that the Appellants may withdraw from representing the Respondent and may charge her on an hourly basis in the event that a proposed settlement is recommended by the Appellants and refused by the Respondent. [ 8 ] Between May 3, 2016, and August 14, 2020, the Appellants performed various services for the Respondent. On July 22, 2020, Justice Tilleman issued a final decision in a binding Judicial Dispute Resolution regarding FL01-21880. Counsel for the Defendant in that action proposed a different Settlement Offer which the Appellants recommended to the Respondent.

She refused; Justice Tilleman’s decision became binding and the Appellants filed a Notice of Withdrawal of Lawyer of Record as the Respondent had refused the Settlement Offer. [ 9 ] On August 24, 2020, the Appellants issued invoice #109172 for their legal fees. In the circumstances, the legal fees were charged on an hourly basis rather than a contingency basis, as provided for in the Agreement. Issue [ 10 ] Should the Review Officer have made an assessment and subsequently referred the questions relating to the Appellant’s negligence to a Justice?

Law [ 11 ] Rules 10.26 and 10.27 of the Alberta Rules of Court , Alta Reg 124/2010 , prescribe what a Justice may do on appeal from a Review Officer’s decision. Specifically, a Justice may:

i) Confirm, vary or revoke the decision; ii) Revoke the decision and substitute a decision; iii) Revoke all or part of the decision and refer the matter back to the review officer or to anther review officer; or iv) Make any other Order the Justice considers appropriate. [ 12 ] A review officer’s decision can be challenged on the following grounds, as outlined in Repchuk v Silverberg , 2013 ABQB 305 at para 38 :

i) Erring in fact , for which a party must demonstrate that the fact as found is “clearly in error”; ii) Erring in principle (law) , which will be shown if a party can demonstrate that the review officer proceeded on an erroneous principle, failed to apply a required principle or that the award of the review officer is so high or low as to betray an error of principle; iii) Erring in true questions of jurisdiction (law) , for which a standard of correctness will apply; and iv) Failing to provide a hearing that is procedurally fair , for which a standard of correctness will apply. (emphasis in original) [ 13 ] A review officer can only deal with questions related to quantum.

They cannot deal with other issues between the parties; all other issues must be referred to the court for determination: MacKimmie Mathews v Hector , 1998 ABCA 278 at para 7 . [ 14 ] A review officer is considered to be an expert in their field. They are the most qualified to determine whether the value of legal services is fair and reasonable, after consideration of the principles relevant to assessing legal fees. Argument [ 15 ] Both parties wanted, and set, the appointment for the review.

It was only when the Review Officer was faced with a newly filed Statement of Claim, alleging negligence of the lawyers involved, that he determined the matter could not be dealt with at that time. In particular, he indicated that the review process could not go ahead until a judge had made a determination on the issues raised in the Statement of Claim.

He was concerned that if he made a finding on the review, it may have affected the lawsuit, it may have affected the firm’s ability to defend, or it may have affected the Respondent’s ability to raise issues if he had already commented on the issue or made some determination. Therefore, the Review Officer adjourned the review sine die until the negligence action was concluded. [ 16 ] The Appellants argue that the Review Officer erred on the question of his jurisdiction. The Review Officer only deals with reasonableness of the account and the quantum.

The review should, therefore, have proceeded, especially since both parties requested it. The issue of negligence is a very different determination than that of the reasonableness of the account. [ 17 ] The Appellants further argue that failure to deal with the review of the account leaves them in limbo indefinitely, never knowing when the litigation will conclude. If claims of negligence are unfounded, the Appellants have been placed on hold before they can collect on their account.

If the claims of negligence are established, then the Respondent would be able to set off any payments on the account against the award in the negligence action. The law firm would be obligated to pay any award against it. Decision [ 18 ] I am satisfied that the Review Officer had the jurisdiction to review the lawyer’s charges and should not have adjourned the matter sine die . Both parties wanted the review done. [ 19 ] The difficulty in adjourning the matter sine die is that the Appellants have very little control over when the negligence action is resolved. It is in the hands of the Respondent.

Given delays in the court system, it could be years before the matter is concluded. [ 20 ] The matters are also distinct. The expertise of the Review Officer is to review the account and determine whether it is fair and reasonable within the principles which guide review decisions. The Review Officer cannot consider or opine on questions of negligence; that is for the Court of Queen’s Bench. The Court of Queen’s Bench will determine whether the Appellants were negligent in their handling of the Respondent’s affairs. The Court is not bound by any decision of the Review Officer in reviewing the account.

If, at the end of the litigation, the Respondent is awarded damages against the Appellants for negligence, the Respondent can set those damages off against the balance of the account and/or be entitled to a Judgment against the Appellants. [ 21 ] In this matter, there is a Contingency Fee Agreement. There is no issue with respect to the Agreement. Specifically, it provides for a percentage fee, at para 5, as follows:

i) From the date of this agreement until a Request to

Schedule a Trial Date is filed and the matter booked for trial- Thirty-three and one third (33 1/3%) per cent, and

ii) After a Request to

Schedule a Trial Date is filed and the matter is booked for trial to the conclusion of trial- Forty (40%) per cent. [ 22 ] The matter was scheduled for trial. The parties elected to proceed, instead, by way of a binding Judicial Dispute Resolution. A binding decision was rendered by Justice Tilleman. [ 23 ] The Appellants rendered an invoice on an hourly fee basis as they were entitled to do under the Contingency Fee Agreement. [ 24 ] If the Appellants are relying only on the Contingency Fee Agreement and not on an hourly basis, the Court would be prepared to substitute a decision for that of the Review Officer.

Specifically, the Court finds that the Appellants are entitled to a fee of 40% of the benefit accruing to the Client by Settlement or Judgment and the collection of funds pursuant to the Settlement or Judgment. [ 25 ] If the Appellants are relying on the hourly basis charged in the account, then the matter is remitted back to the Review Officer for a determination. Costs [ 26 ] There shall be no costs to either party as a result of this appeal. Both parties wanted the review. It was a decision of the Review Officer that the review would not proceed. Heard on the 29 th day of October, 2021.

Dated at the City of Calgary, Alberta this 22nd day of December, 2021. C.L. Kenny J.C.Q.B.A. Appearances: Terry Czechowskyj for the Appellants, Miles Davison LLP, Peter Leveque and Laurie Turnquist Laurel Christie Rennich Self-Represented Respondent