Dispute over personal injury referrals

A lawyer who has been a public face for a firm owned by two of his uncles is at the centre of an unusual contract dispute with another personal injury law firm that operates on the same floor of a Toronto office building.

Jeremy Diamond is facing allegations that he has been referring personal injury files to other law firms in breach of an exclusive professional services agreement between Diamond & Diamond and Bergmanis Preyra LLP. None of the allegations have been proven in court.

The legal action, which is now at the Ontario Divisional Court, has already seen Bergmanis Preyra enlisting friends to pose as potential clients in order to see which firms they received referrals to. Bergmanis Preyra then obtained an Anton Piller order to enter the premises of Diamond & Diamond and make copies of business records.

In response, Jeremy Diamond retained the high-powered firm of Paliare Roland Rosenberg Rothstein LLP, which managed to have the Anton Piller order set aside, while he testified that he was an independent contractor for Diamond & Diamond without his own trust account.

Bergmanis Preyra is now seeking leave to appeal the decision of Superior Court Justice Paul Perell on Oct. 11 that ordered an independent lawyer in possession of the copies of the records to return them to Jeremy Diamond. As the litigation continues, the actual role and legal practice of Jeremy Diamond is still unclear from what’s before the court.

The parties signed the professional services agreement that’s at issue in February 2007 while Jeremy Diamond was articling for his uncles. It required the firm controlled by David Diamond and James Diamond to refer all potential personal injury files to Bergmanis Preyra. If Bergmanis Preyra took on a referred client, the firm would send 30 per cent of its billings to Diamond & Diamond as a referral fee, according to court documents.

The parties struck the business arrangement in part because the Diamonds wanted to maintain the “goodwill and profile” of the firm until their sons graduated from law school and could take it over, states an affidavit sworn by Kurt Bergmanis. As well, Diamond & Diamond agreed to sublet space from Bergmanis Preyra on the same floor in a building near the Allen Expressway in Toronto.

The number of new referrals started to decline in the past couple years, said Bergmanis in the affidavit. “We appeared to gradually receive fewer large file referrals and increasing numbers of small and/or difficult file referrals during a time when we knew that the respondents were significantly increasing their advertising to the public and their media presence,” the affidavit states.

The firm then recruited two friends to contact Diamond & Diamond as potential clients with large claims. But a firm other than Bergmanis Preyra contacted both individuals, court documents state.

Superior Court Justice Darla Wilson granted an Anton Piller order on Sept. 12 that permitted Bergmanis Preyra to make copies of business records at Diamond & Diamond and from Alex Ragozzino, a legal assistant. The materials were turned over to an independent lawyer.

Jeremy Diamond and his assistant challenged the order on the basis that they’re not partners or associates of Diamond & Diamond nor are they parties to the professional services agreement.

During cross-examination on his affidavit, Jeremy Diamond indicated he was an independent contractor paid a fee of $700 per referral by David Diamond. There was no written agreement between the family members and Jeremy Diamond’s counsel instructed him not to answer several questions related to his role at the firm.

“Were you practising law in your relationship with Diamond & Diamond?” asked Alan Rachlin, a lawyer representing Bergmanis Preyra, during a private cross-examination of Jeremy Diamond on Oct. 9.

“That can — I mean, I’m — I don’t really understand that question,” replied Jeremy Diamond.

In setting aside the Anton Piller order, Perell accepted the arguments put forward by lawyer Linda Rothstein on behalf of Jeremy Diamond. “It cannot be said that Jeremy or Alex themselves breached a contract to which they are not parties and for which they received no consideration and for which there is no bargain or meeting of the minds whatsoever,” wrote Perell.

While the evidence before the Superior Court was that Jeremy Diamond was an independent contractor, he has a prominent public profile with the firm.

According to the Diamond & Diamond web site, Jeremy Diamond “joined the firm” as a lawyer after his call to the bar in Ontario in 2008 and is also its director of marketing. The web site shows pictures of two lawyers, David and Jeremy Diamond [James Diamond is no longer an active lawyer and doesn’t appear on the Law Society of Upper Canada’s directory. James F. Diamond, a partner at Levine Sherkin Boussidan in Toronto, is a different person].

Diamond & Diamond advertises widely in Toronto in both the media and on public transit. Jeremy Diamond appears on a regular segment called “Know your rights” on the CP24 news channel along with former Ontario Provincial Police officer Cam Woolley. Woolley describes him as a personal injury lawyer with the firm in the TV segments.

As recently as this September, a number of video ads about personal injury law appeared on YouTube. All of the advertisements prominently feature the Diamond & Diamond logo and phone number. In one, Jeremy Diamond states: “We have teams of professionals on call to deal with everything from the most severe to minor of injuries.” In another, he notes the team at Diamond & Diamond includes “doctors, physiotherapists, case managers, and other health professionals intent on helping you get better.”

Jeremy Diamond’s wife, Sandra Zisckind, hosts two of the YouTube videos. “I am a lawyer with Diamond & Diamond,” states Zisckind in the videos. She urges potential clients to call Diamond & Diamond. The law society lists Zisckind as practising with Grillo Barristers and she appears on that firm’s web site as one of its lawyers. A message left by Law Times on her office voicemail at Grillo seeking comment wasn’t returned.

A bid for a stay of Perell’s order landed at the Divisional Court on Oct. 29. Three days later, Justice Frances Kiteley ruled against granting a stay until the court hears the motion for leave to appeal. Kiteley noted Rothstein has undertaken to keep the documents at her office and said Jeremy Diamond has been unfairly “tainted” by the implication that he wouldn’t preserve the materials.

“Given the ongoing litigation, we do not intend to provide any public comments,” says Rothstein. Her client testified that as of Sept. 24, his uncle had terminated his services with Diamond & Diamond “for the time being.”

While he declined to speak about his nephew, David Diamond tells Law Times that there are two areas he wants to clarify. “First, the law firms of Bergmanis Preyra and Diamond & Diamond continue to be on excellent terms,” he says. As well, David Diamond adds that the law society has approved the disclaimer on the web site that explains how the firm is primarily a referral source and “initial screening assessment agent.”

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