Hean Wylie Peach de Stefanis, Re, (2005) 210 B.C.A.C. 171 (CA)

• Judge: Rowles, Ryan and Mackenzie, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: February 02, 2005
• Jurisdiction: British Columbia
• Citations: (2005), 210 B.C.A.C. 171 (CA);2005 BCCA 156

Hean Wylie Peach de Stefanis, Re (2005), 210 B.C.A.C. 171 (CA);

    348 W.A.C. 171

MLB headnote and full text

Temp. Cite: [2005] B.C.A.C. TBEd. MR.046

In The Matter Of the Legal Profession Act, S.B.C. 1998, Chapter 9

And In The Matter Of Furio Giorgio de Stefanis and Thomas Peach practicing law under the name and style of Hean Wylie Peach de Stefanis

Law Society of British Columbia and Bruce A. Thompson, Custodian of the Law Practice of Furio de Stefanis and Thomas Peach (appellants/applicants) v. Royal Bank of Canada and Attorney General of Canada (respondents/respondents)

(CA031587; 2005 BCCA 156)

Indexed As: Hean Wylie Peach de Stefanis, Re

British Columbia Court of Appeal

Rowles, Ryan and Mackenzie, JJ.A.

March 21, 2005.

Summary:

The Law Society of British Columbia obtained an order appointing Thompson custodian of the law practice of Hean Wylie Peach de Stefanis. The Law Society applied for an order for an administrative charge to secure the custodian's fees and costs.

The British Columbia Supreme Court, in a decision reported at [2004] B.C.T.C. 10, dismissed the application. The Law Society and Thompson appealed.

The British Columbia Court of Appeal dismissed the appeal.

Barristers and Solicitors - Topic 7706

Regulation - Custodian - Appointment of - Authority respecting lawyer's property - [See second Barristers and Solicitors - Topic 7709 ].

Barristers and Solicitors - Topic 7709

Regulation - Custodian - Appointment of - Costs and fees (incl. administrative charge) - The Law Society of British Columbia obtained an order appointing Thompson custodian of the law practice of Hean Wylie Peach de Stefanis - The Law Society applied for an order for an administrative charge to secure the custodian's fees and costs - The Chambers judge dismissed the application - The Law Society and Thompson appealed - The British Columbia Court of Appeal dismissed the appeal - Section 56(3) of the Legal Profession Act stated that "unless the court otherwise orders, the lawyer or the estate of the deceased lawyer must pay to the society the fees, expenses and disbursements ..." - The court rejected the argument that the phrase "unless the court otherwise orders" opened the door to granting a priority to the custodian - The court held that the wording indicated a legislative intent to reserve to the court some measure of discretion in determining whether the lawyer had to pay to the Law Society the fees, expenses and disbursements of the custodian - See paragraph 31.

Barristers and Solicitors - Topic 7709

Regulation - Custodian - Appointment of - Costs and fees (incl. administrative charge) - The Law Society of British Columbia obtained an order appointing Thompson custodian of the law practice of Hean Wylie Peach de Stefanis - The Law Society applied for an order for an administrative charge to secure the custodian's fees and costs - The Chambers judge dismissed the application - The Law Society and Thompson appealed - The British Columbia Court of Appeal dismissed the appeal - Section 56(3) of the Legal Profession Act stated that "unless the court otherwise orders, the lawyer or the estate of the deceased lawyer must pay to the society the fees, expenses and disbursements ..." - The court rejected the argument that the phrase "unless the court otherwise orders" opened the door to granting a priority to the custodian - The court held the reimbursement provision in s. 56(3) provided an in personam remedy against the lawyer for the custodian's fees and disbursements - That section did not purport to grant the Law Society security over the property of the lawyer, nor did it give the Law Society's claim for costs priority over secured creditors - See paragraph 32.

Barristers and Solicitors - Topic 7710

Regulation - Custodian - Appointment of - Duties of custodian to lawyer's clients - The Law Society of British Columbia obtained an order appointing Thompson custodian of the law practice of Hean Wylie Peach de Stefanis - The Law Society applied for an order for an administrative charge to secure the custodian's fees and costs - The Chambers judge dismissed the application - The Law Society and Thompson appealed - The British Columbia Court of Appeal dismissed the appeal - Section 51(h) of the Legal Profession Act stated that the custodian could "deal with the assets and liabilities of the lawyer's practice to the extent necessary to protect the interest of the clients and subject to the interest of the clients (i) pay all or part of the expenses and disbursements of and incidental to any acts done or proceedings taken under [Part 7 of the Act]" - The effect of granting a priority to the custodian would not be in accord with the objects of the statute - The primary concern of the custodian was the interest of the clients - That was a significant difference from a receivership or a monitor appointed under the Companies' Creditors Arrangement Act, whose concern was the creditors - Accordingly, a custodian could not act as a de facto receiver and have an administrative charge - See paragraphs 37 to 39.

Cases Noticed:

United Used Auto & Truck Parts Ltd., Re (2000), 135 B.C.A.C. 96; 221 W.A.C. 96; 16 C.B.R.(4th) 141 (C.A.), dist. [para. 5].

Kennedy, Re (1997), 213 A.R. 120; 18 C.P.C.(4th) 81 (Q.B.), refd to. [para. 33].

Statutes Noticed:

Legal Profession Act, S.B.C. 1998, c. 9, sect. 51(h) [para. 28]; sect. 56(3) [para. 23].

Counsel:

K.S. Campbell, for the appellants;

J.P. Mockler, for the respondent, Royal Bank of Canada;

D.G. Nygard and J.S. Leslie, for the respondent, Attorney General of Canada.

This appeal was heard on February 2, 2005, at Vancouver, British Columbia, before Rowles, Ryan and Mackenzie, JJ.A., of the British Columbia Court of Appeal. The following decision of the Court of Appeal was delivered by Rowles, J.A., on March 21, 2005.