Judge raps law firm for delay

A judge has awarded costs against a Toronto-area law firm for holding up an application for an assessment of accounts by a former client unhappy with the service she received.

In an endorsement earlier this month, Justice Thomas Lederer awarded the applicant almost $7,000 in costs and scolded Heydary Hamilton PC for failing to respond to the application in a reasonable time and then attempting to have proceedings adjourned on short notice.

“Lawyers and judges do not act in a vacuum,” Lederer wrote. “They function within a society. The actions they take and decisions they make should bear in mind the public impact of what they are.

Parties who wish to question accounts should not be prevented from doing so by the cost of the process of assessment. This is especially so where costs are occasioned by the firm failing to respond or move with reasonable speed.”

The endorsement is an important one for lawyers, says Bruce Baron, a lawyer with Miller Canfield Paddock and Stone who represented the applicant.

“With the costs of litigation being so expensive, it’s so easy to allow costs of the litigation to quickly exceed the benefit of that litigation, and in the context of an assessment hearing, that is extremely true. It sends a message that we need to put our clients first at all times.”

Heydary Hamilton didn’t respond to a request for comment before going to print.
The applicant, Elisa Kennedy, retained Heydary Hamilton and paid the firm almost $29,000 in retainers.

She received 13 accounts totalling $27,000, which came out of the retainer, but Kennedy was unhappy with the firm’s work on her case. She wanted court proceedings started more quickly and thought time was wasted on futile settlement talks.

Kennedy eventually retained a new lawyer and in February applied for an assessment of accounts. When the firm refused to consent, material for the application was served in mid-March.

Almost two months passed before a Heydary Hamilton lawyer responded, saying the lawyer concerned had left the firm and that she would be unable to attend court on the date set for the application, just over two weeks from the letter’s date.

The firm asked for an adjournment, which Baron refused. Eventually, a junior counsel appearing in the lawyer's place told the court she couldn’t argue the motion.

“One wonders what significance the firm is giving this matter when it fails to respond until it was impractical to prepare, seeks to oppose the motion on the basis that it wishes to have the merits of the assessment adjudicated by the court, and then effectively assumes an adjournment will be granted by sending a lawyer who cannot argue it,” Lederer said in his endorsement.

“To grant this adjournment would be to place greater value to the failings of the firm than the reasonable expectations of its former client that she can obtain an assessment of the accounts at a reasonable cost with a reasonable time.”

Lederer allowed the application for assessment, ruling that since the payments were made in retainers, they were not made in response to accounts for work done, and Kennedy should have a chance to set the payment against the service.

Baron says Heydary Hamilton’s approach to the application wouldn’t raise an eyebrow in conventional litigation. But in this case, he argues that the power imbalance between a law firm and a former client demands a different standard of conduct.

“I think there’s a serious distinction between how law firms should respond to litigation in the conventional context where they’re dealing with individual clients versus when they are dealing with a former client and representing themselves.

I think Justice Lederer was very mindful of protecting the administration of justice and the environment of fair play between a law firm and its former client.” 

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