Stevenson v O’Byrne, 2018 SKCA 88

Court of Appeal for Saskatchewan Docket: CACV3028 Citation: Stevenson v O’Byrne , 2018 SKCA 88 Date: 2018-11-15 Between: Robert L. Stevenson Appellant (Applicant/Respondent) And Ronald Lewis O’Byrne Respondent (Respondent/Applicant) And RBC Life Insurance Company Non-Party (Defendant) Before: Ottenbreit, Ryan-Froslie and Schwann JJ.A. Disposition: Appeal dismissed Written reasons by: The Honourable Mr.

Justice Ottenbreit In concurrence: The Honourable Madam Justice Ryan-Froslie The Honourable Madam Justice Schwann On Appeal From: 2017 SKQB 16 , Saskatoon Appeal Heard: September 12, 2018 Counsel: John Benesh for the Appellant Ronald O’Byrne appearing on his own behalf Ottenbreit J.A. [ 1 ] Robert L. Stevenson appeals the decision of a Queen’s Bench Chambers judge dated January 16, 2017, dismissing his appeal of an assessment by the Judicial Centre of Saskatoon Local Registrar of legal accounts rendered to Ronald Lewis O’Byrne. For the reasons hereinafter set forth, the appeal is dismissed. [ 2 ] In 2010, Mr.

Stevenson filed a claim against RBC Life Insurance Company on behalf of Mr. O’Byrne claiming RBC had prematurely terminated disability benefits to which Mr. O’Byrne was entitled pursuant to a group policy. The claim was defended by RBC, which denied the allegations. Mr. Stevenson continued to represent Mr. O’Byrne on the matter until September 2015 when Mr. O’Byrne accepted a settlement from RBC at a pretrial conference. Mr. O’Byrne was unhappy with the accounts rendered to him by Mr. Stevenson in the matter and applied for an assessment of whether they were fair and reasonable. [ 3 ] Mr.

O’Byrne ultimately obtained an order for assessment of three accounts of Mr. Stevenson that were dated October 3, 2014, July 13, 2015, and September 15, 2015. The assessment was conducted before the Local Registrar at the Judicial Centre of Saskatoon in the presence of both parties. The matter proceeded on the basis of affidavit evidence, briefs and oral submissions. [ 4 ] In due course, the Local Registrar, in an eleven-page decision, provided his certificate of assessment dated September 6, 2016, as to whether the accounts were fair and reasonable pursuant to Rule 11-23 of The Queen’s Bench Rules .

In his certificate, he made a number of factual findings. [ 5 ] The Local Registrar found that the solicitor-client relationship between Mr. O’Byrne and Mr. Stevenson, although starting amicably, deteriorated in the months leading up to the pretrial conference. He determined Mr. O’Byrne became concerned in October 2014 that he was being billed for services that were duplicated and that he considered retaining new legal counsel. He found, despite Mr. O’Byrne’s concerns and despite that he had received a verbal second opinion that he was being overcharged for legal services, Mr. O’Byrne chose to continue with Mr.

Stevenson as his legal counsel. This was mainly because Mr. O’Byrne was worried that retaining new counsel would result in added costs for a new lawyer to familiarize him or herself with the file. [ 6 ] The Local Registrar found that the solicitor-client relationship came to an end at the pretrial conference. At the pretrial conference, Mr. O’Byrne accepted a settlement of a lump-sum payment of $35,000 in addition to reinstatement of monthly disability benefits until the age of 65. The Local Registrar determined Mr. O’Byrne agreed to the settlement against Mr.

Stevenson’s advice. [ 7 ] The Local Registrar also found that Mr. Stevenson was competent and knowledgeable about the issues in the case and that he was fully invested in obtaining the best possible outcome for Mr. O’Byrne. [ 8 ] In his certificate, the Local Registrar acknowledged the principles governing assessments.

He referred to Queen’s Bench Rule 11-23, the Law Society’s Code of Professional Conduct Rule 2.06(1) commentary that sets out the factors and criteria to be considered by the assessment officer, and The Queen’s Bench Rules regarding pretrial conferences and pretrial briefs, as well as relevant case law. [ 9 ] In the context of those principles, he instructed himself that the fee should reflect time expended and work done, the value to the client of the results achieved, the complexity of the issues involved, the degree of competence and ability demonstrated by the lawyer, and the extent of responsibility assumed by him.

[ 10 ] He noted that Mr. Stevenson had provided detailed and itemized hourly billing information. [ 11 ] The Local Registrar also noted the parties had agreed on certain facts: (

a) Mr. Stevenson’s hourly rate of $400 per hour was disclosed by him to Mr. O’Byrne at the outset; (

b) a retainer agreement was not signed by Mr. O’Byrne; (

c) an estimate of costs was not discussed or provided to Mr. O’Byrne; (

d) tariff items, fees and disbursements were not in issue; and (

e) the value of the final settlement, including the reinstatement of monthly benefits until the age of 65 for Mr.

O’Byrne, totalled $466,381.76 in addition to a $35,000 lump-sum payment. [ 12 ] After review of the three accounts, the Local Registrar concluded the account dated October 3, 2014, in the amount of $4,752.00 was fair and reasonable. [ 13 ] With respect to the account dated July 13, 2015, in the amount of $15,397.82, he concluded that it should be reduced to $10,557.81 on the basis there had been some errors in adding the number of hours for which legal services were billed and that the number of hours billed for research was excessive. [ 14 ] The third account, dated September 15, 2015, in the amount of $31,835.46, covered primarily Mr.

Stevenson’s work leading up to the pretrial settlement. The Local Registrar observed that Mr. Stevenson had provided a courtesy reduction of this bill, which reduced it to $25,000, that sum having been paid by Mr. O’Byrne out of the proceeds of the settlement. He concluded that Mr. Stevenson could not, for the purposes of the assessment, resile from that reduction and that it was binding on Mr. Stevenson. [ 15 ] The Local Registrar reviewed the pretrial brief submitted by Mr. Stevenson and noted that it contained the elements prescribed in The Queen’s Bench Rules , including a

summary of facts, legal argument and the settlement position. He noted, however, that it was not a large document and the time required to put the material together should have been minimal. Mr. Stevenson was counsel of record from the start of the action and would have been familiar with the facts and issues well before the pretrial conference. After all considerations, he concluded the research and preparation time billed was excessive and made a reduction of the time spent on the brief.

Accordingly, he reduced the account to $23,035.46. [ 16 ] The three accounts in question were accordingly assessed at $38,345.27 in total. He directed that Mr. Stevenson refund Mr. O’Byrne the amount of $13,640.01. [ 17 ] Mr. Stevenson appealed the certificate of assessment to the Chambers judge. The Chambers judge noted that considerable deference must be shown to the decision of the Local Registrar where, as in this case, he was alive to the legal and factual issues associated with the assessment.

The Chambers judge found the Local Registrar had properly and accurately characterized the legal action as a claim in which the defendant prematurely terminated disability benefits. [ 18 ] He concluded that the Local Registrar did not make a mistake in principle or fail to exercise his discretion in a reasonable manner with respect to the July 13, 2015, account when he reduced the number of hours. [ 19 ] The Chambers judge then turned to the September 15, 2015, account. He dealt first with Mr. Stevenson’s attempt to resile from the reduction of this account to $25,000.

He did not accept his argument that the reduction was in fact conditional on Mr. O’Byrne not applying for an assessment of this bill. He determined that any condition preventing assessment of the account would have been contrary to law and public policy. He was not satisfied that Mr. O’Byrne would have appreciated the nuances of conditional accounts while dealing with pretrial settlement considerations. He agreed with the Local Registrar’s decision that the account reduction was binding on Mr. Stevenson.

After noting the Local Registrar’s reduction of the account for excessive research and preparation time for the pretrial brief, he concluded that the Local Registrar did not make a mistake in principle in how he approached the account nor did he exercise his discretion unreasonably. [ 20 ] The Chambers judge determined that the appeal of the assessment was without merit and dismissed Mr. Stevenson’s application. He assessed net costs against Mr. Stevenson in the sum of $200. [ 21 ] Mr.

Stevenson, on appeal to this Court, argues that the Chambers judge erred in law by disregarding relevant facts and misinterpreting facts in determining whether the statements of account were fair and reasonable. He argues that the Local Registrar failed to take into account the mandatory factors as set out in the commentary to Rule 2.06(1) of the Code of Professional Conduct referenced in Rule 11-23 of The Queen’s Bench Rules . He argues that the Local Registrar referred to one factor only – the time required and spent in providing legal services but disregarded relevant facts concerning Mr.

O’Byrne’s knowledge of and consent to the fee in advance of his decision to accept the amount of the settlement at pretrial. [ 22 ] Mr. Stevenson argues that the Rule 2.06(1) commentary specifically states what is fair and reasonable and includes such factors as the relevant agreement between the lawyer and the client, the estimate and range of fees given by the lawyer and the client’s prior consent to the fee. Mr. Stevenson submits that on September 1, 2015, he met with Mr. and Mrs.

O’Byrne prior to attending the pretrial settlement conference scheduled for the next day and discussed the value of potential settlement amounts, the legal costs to date, additional unbilled amounts and the net amount of the settlement after allowing for legal expenses. He argues that he had provided a settlement value sheet to Mr. O’Byrne that set out paid fees and unbilled fees. He submits Mr. O’Byrne had signed a direction to pay his account of $25,000 out of the settlement proceeds. In short, he argues that Mr.

O’Byrne agreed to pay the account and that factor should have been determinative of what was fair and reasonable or at least should have been given greater weight. [ 23 ] The law governing the taxation of a solicitor’s account is set forth in Phillips Legal Professional Corporation v Vo , 2017

SKCA 58 , [2017] 12 WWR 779 [ Phillips ]. The scheme for taxation of a solicitor’s account under The Queen’s Bench Rules must be interpreted in the context of The Legal Profession Act, 1990 , SS 1990-91, c L-10.1 [ LPA ], as part of the regulation of lawyers and as sharing the LPA ’s general object of public protection ( Phillips at paras 53–56 ). The rendering of legal services is not simply a matter of contract between client and lawyer ( Phillips at para 55 ). [ 24 ] The court will intervene where necessary to protect the client’s right to a fair procedure for the assessment of a solicitor’s bill.

Where there is no specific contract between the solicitor and his client, the general custom and practice of solicitors is to be the guide. If there is no custom, the value of the services rendered is to be estimated on a quantum meruit basis. In determining what is fair and reasonable, the factors set out in the Code of Professional Conduct Rule 2.06(1) commentary are to be used ( Phillips at para 59 ).

What is fair and reasonable is left to the discretion of the assessment officer who applies his or her knowledge and experience in the process, relying on general or special expertise ( Phillips at para 61 ). [ 25 ] The onus of proving that an account is fair and reasonable is always on the solicitor ( Phillips at para 66 ). [ 26 ] The applicable standard of review governing a Chambers judge dealing with a local registrar’s assessment is deferential.

The judge must not retry the matter and substitute his or her opinion for that of the assessment officer where there is no error in principle and no palpable and overriding error in the assessment officer’s assessment of the evidence and material placed before him ( Phillips at para 69 ). The Chambers judge must review the assessment officer’s decision and consider whether the officer duly applied the principles that inform the assessment, deferring on matters within the officer’s discretion.

For the purposes of the appeal, the determination of the value of services by the assessment officer is a question of fact ( Phillips at para 72 ). [ 27 ] Applying the governing law, and looking at the Local Registrar’s decision as a whole, it is clear that the Local Registrar took into account all appropriate factors to arrive at the assessment he did, namely time and effort required and spent, the difficulty of the matter, the importance of the matter to the client, Mr.

Stevenson’s experience and ability and his special skill and services, the results obtained, the estimate or range of fees given and the relationship generally between the parties. [ 28 ] Mr. Stevenson argues there was no basis to find that the relationship with Mr. O’Byrne had broken down. However, it is clear from the findings of fact set out in the Local Registrar’s certificate that the relationship immediately prior to the acceptance of the settlement was strained and this is confirmed upon a reading of the affidavit of Mr. Stevenson dated January 5, 2016. [ 29 ] The settlement value sheet reviewed with Mr.

O’Byrne prior to the pretrial conference and the direction to pay signed by him reflecting a fee of $25,000 cannot be construed as consent by Mr. O’Byrne that the account was fair and reasonable. In the context of this case these documents are not determinative. [ 30 ] On the basis of the governing principles enunciated earlier, I conclude the Chambers judge made no error in determining that the Local Registrar’s certificate must stand. He identified and applied the correct standard of review. The Chambers judge was cognizant of the principles governing the Local Registrar in his assessment.

He correctly determined that the Local Registrar properly applied the germane principles in the assessment of Mr. Stevenson’s accounts. [ 31 ] I am satisfied that the Chambers judge made no error in dismissing Mr. Stevenson’s appeal. [ 32 ] Before I conclude, I want to address the comments of Mr. O’Byrne made during his oral submissions, which could be construed as casting aspersions on the conduct of Mr. Stevenson in this matter. I see no indication that Mr. Stevenson conducted himself in any way other than in good faith and with integrity. [ 33 ] The appeal is dismissed. Mr.

O’Byrne shall have his costs in the usual manner. “Ottenbreit J.A.” Ottenbreit J.A. I concur. “Ryan-Froslie J.A.” Ryan-Froslie J.A. I concur. “Schwann J.A.” Schwann J.A.