Thompson v. Thompson et al., (2008) 323 Sask.R. 75 (QB)

• Judge: Allbright, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: October 01, 2008
• Jurisdiction: Saskatchewan
• Citations: (2008), 323 Sask.R. 75 (QB);2008 SKQB 395

Thompson v. Thompson (2008), 323 Sask.R. 75 (QB)

MLB headnote and full text

Temp. Cite: [2008] Sask.R. TBEd. OC.042

Darlene Thompson (Martin) (respondent/applicant) v. Merchant Law Group (appellant/respondent)

(1998 D.I.V. No. 47040441; 2008 SKQB 395)

Indexed As: Thompson v. Thompson et al.

Saskatchewan Court of Queen's Bench

Judicial Centre of Estevan

Allbright, J.

October 1, 2008.

Summary:

The plaintiff entered into a bonus fee agreement with the Merchant Law Group (Merchant) to represent her in a divorce. Three months after trial, the plaintiff applied for a declaration that the fee agreement was neither fair nor reasonable and for an order that the statement of account be referred to the local registrar for assessment.

The Saskatchewan Court of Queen's Bench, in a decision reported at (2005), 268 Sask.R. 111, held that the agreement was fair and reasonable but the agreement that Merchant receive taxable costs was unfair. The plaintiff was entitled to keep any costs awarded to her. The plaintiff's application for an order that the statement of account be referred for assessment was dismissed. Merchant filed an appeal. The Law Society of Saskatchewan applied for intervenor status in the appeal.

The Saskatchewan Court of Appeal, per Jackson, J.A., in a decision reported at (2007), 304 Sask.R. 227; 413 W.A.C. 227, allowed the application on a limited basis. The plaintiff cross-appealed and applied to admit fresh evidence on the appeal. The fresh evidence showed that the plaintiff's formal offer to settle in the divorce action had never been served.

The Saskatchewan Court of Appeal, in a decision reported at (2007), 302 Sask.R. 311; 411 W.A.C. 311, admitted the fresh evidence and, on the basis of that, determined that the fee agreement was unfair, premised, as it was, on the express understanding that a formal offer of settlement was to be immediately served. The agreement was void for unfairness. The appeal was dismissed and the cross-appeal was allowed to the extent of referring the bill for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis. The registrar set Merchant's fees, assessed on a quantum meruit basis, at $72,711.99, inclusive of taxes and disbursements. Merchant sought a review.

The Saskatchewan Court of Queen's Bench allowed the application to the limited extent of assessing an additional $5,000 for a pre-trial conference, increasing the amount assessed for 36 hours spent on the trial of the action from $10,000 to $14,040 (to reflect Merchant's hourly rate of $390) and correcting the registrar's error in calculating the total amount of disbursements and taxes. Beyond those limited instances, there was no basis for setting aside or varying the registrar's assessment.

Barristers and Solicitors - Topic 3241

Compensation - Taxation or assessment of accounts - General - A wife in a divorce action was successful in having a bonus fee agreement with her counsel, Merchant Law Group, set aside as unfair - The account was referred for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis - The registrar set Merchant's fees at $72,711.99, inclusive of taxes and disbursements - Merchant sought a review, asserting, inter alia, that the assessment process in Saskatchewan was inadequate to deal with findings of this significance - The Saskatchewan Court of Queen's Bench rejected the argument - While the litigation under scrutiny was complicated and of some duration, it was not unique in the province - The local registrar followed the process that had existed for a long time - If a new process was to be contemplated, it was not the registrar's obligation to structure it - There was no reason to set aside the assessment on that basis - See paragraphs 45 to 47.

Barristers and Solicitors - Topic 3303

Compensation - Measure of compensation - Relevant considerations - A wife in a divorce action was successful in having a bonus fee agreement with her counsel, Merchant Law Group, set aside as unfair - The account was referred for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis - The registrar set Merchant's fees at $72,711.99, inclusive of taxes and disbursements - Merchant sought a review, asserting, inter alia, that the registrar erred in law in applying dispositions by courts for different purposes to the assessment in question - In particular, Merchant referred to the registrar's reliance on an appeal decision and on McIntyre, J.'s, costs decision following the parties' divorce trial in which he disallowed any party and party costs flowing to the wife for an early unsuccessful pre-trial conference - Merchant asserted that while McIntyre, J., was entitled to assess the conference as being unproductive and unnecessary, it had occurred as a result of specific instructions from the wife and that, therefore, the wife should be required to pay counsel's reasonable fees - The Saskatchewan Court of Queen's Bench held that the registrar in his overall analysis was entitled to consider the previous decisions - This was not a basis for setting aside the assessment - The decisions were related to the litigation - While there was a principled difference between a party and party analysis and a solicitor/client analysis, this did not mean that the two judgments ought not to have been referred to or used by the registrar in considering the appropriate quantum meruit assessment - However, the court did agree that it was appropriate to award Merchant fees for the first pre-trial conference where it was solely occasioned by the wife's request and assessed an additional $5,000 - However, where Merchant undertook a similarly unsuccessful second pre-trial conference when unprepared, the same rationale did not apply - Those actions were appropriately examined on a quantum meruit basis - See paragraphs 48 to 53.

Barristers and Solicitors - Topic 3304

Compensation - Measure of compensation - Quantum meruit - Reasonable charges - A wife in a divorce action was successful in having a bonus fee agreement with her counsel, Merchant Law Group, set aside as unfair - The account was referred for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis - The registrar set Merchant's fees at $72,711.99, inclusive of taxes and disbursements - Merchant sought a review, asserting, inter alia, the registrar erred in not allowing a second counsel fee at trial as this did not reflect the degree of difficulty or the nature of the cause being tried - The Saskatchewan Court of Queen's Bench rejected the argument - The registrar found that the second counsel's involvement became necessary due to scheduling conflicts and that the resulting increase in fees should be borne by Merchant rather than passing them on to the wife - While Merchant had argued that the wife had agreed to two counsel, her expectation had been that one, Mr. Merchant, would be trial counsel - When he became unavailable, she was left with little alternative but to accept a second - There was no error in the registrar's assessment of this matter - It was not unreasonable to conclude that one counsel fee was allowable, which he valued at $10,000 based on 36 hours - The limited change that was appropriate was to allow a counsel fee for the 36 hours at the rate at which the wife would have expected to pay Mr. Merchant ($390 per hour) - The assessment was adjusted to reflect an increase from $10,000 to $14,040 - See paragraphs 55 to 60.

Barristers and Solicitors - Topic 3304

Compensation - Measure of compensation - Quantum meruit - Reasonable charges - [See Barristers and Solicitors - Topic 3303 ].

Barristers and Solicitors - Topic 3305

Compensation - Measure of compensation - Bonus - A wife in a divorce action was successful in having a bonus fee agreement with her counsel, Merchant Law Group, set aside as unfair - The account was referred for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis - The registrar set Merchant's fees at $72,711.99, inclusive of taxes and disbursements - Merchant sought a review, asserting, inter alia, the registrar erred in not allowing an increase or bonus fee for the work performed - The Saskatchewan Court of Queen's Bench rejected the argument - The court noted that Mr. Merchant's hourly rate of $390 was a significant fee, reflective of a high degree of experience and expertise - There was no suggestion that the wife had been charged a reduced hourly rate with the expectation of an increased fee for "success" in the action - However, the court did agree that Merchant had undertaken to their detriment to accept the non-payment of fees for a significant period of time - It was appropriate to allow a fee for that factor - The registrar's assessment was adjusted to include a $5,000 fee for the length of time in which Merchant carried the fees before payment - See paragraphs 69 to 76.

Barristers and Solicitors - Topic 3319

Compensation - Measure of compensation - Respecting unsuccessful services - [See Barristers and Solicitors - Topic 3303 ].

Barristers and Solicitors - Topic 3319

Compensation - Measure of compensation - Respecting unsuccessful services - A wife in a divorce action was successful in having a bonus fee agreement with her counsel, Merchant Law Group, set aside as unfair - The account was referred for taxation by the local registrar to determine a reasonable fee on a quantum meruit basis - The registrar set Merchant's fees at $72,711.99, inclusive of taxes and disbursements - Merchant sought a review, asserting, inter alia, the registrar had erred in assessing no value for unsuccessful chambers applications - The Saskatchewan Court of Queen's Bench rejected the argument - The unsuccessful chambers applications had been commented on by McIntyre, J., in his decision regarding costs of the parties' divorce trial - It would have been unreasonable for the registrar to ignore those comments during the assessment process - While counsel's primary obligation was to the client, nonetheless they were expected to exercise judgment and provide direction to a client to avoid incurring additional expenses both for the client and the opposite party - There was no error in the registrar's treatment of the chambers applications - See paragraphs 61 and 62.

Cases Noticed:

Sandstrom & Scott and United Chemicals Ltd., Re, [1989] 5 W.W.R. 690; 74 Sask.R. 59 (C.A.), refd to. [para. 3].

Thompson v. Thompson (2008), 310 Sask.R. 290; 2008 SKQB 116, refd to. [para. 9].

Wasylyshen v. Filipchuk (1988), 70 Sask.R. 199 (Q.B.), refd to. [para. 33].

Vilness v. Dallyn (1985), 44 Sask.R. 152 (Q.B.), refd to. [para. 34].

Kapoor v. Mulholland (1996), 148 Sask.R. 151; 134 W.A.C. 151 (C.A.), refd to. [para. 35].

Authors and Works Noticed:

McKeague, Neva R., and Voroney, Willa M.B., The Queen's Bench Rules of Saskatchewan: Annotated (1st Ed. 1985) (2000 Looseleaf Update, Release 1), rule 560 [para. 27].

Counsel:

E.F. Anthony Merchant, Q.C., and Drew R. Filyk, for the appellant/respondent, Merchant Law Group;

Daniel P. Kwochka, for the respondent/applicant, Darlene Thompson (Martin).

This application was heard by Allbright, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Estevan, who delivered the following judgment on October 1, 2008.