An upcoming lawsuit in the British Columbia Supreme Court may serve as a crash course for lawyers about the problems that can arise when practising outside a formal partnership.
The trial, which is set to begin on Nov. 17, centres around whether or not the plaintiffs, a pair of lawyers who practised together but were not partners, are owed legal fees by the defendants, their former clients.
“In this action, the plaintiffs said that they provided legal services to the defendants in connection with a successful lawsuit and want to be paid. If only it were that simple,” wrote Master Peter Keighley in a recent pre-trial judgment concerning amendment applications brought by the two parties.
And indeed, the civil claim is far from simple.
The plaintiffs in the case, Ronald Josephson Law Corp. and Alexander S. Angus Personal Law Corp., were independent legal entities. Josephson and Angus practised law together, but did not have a partnership agreement. Instead, they had a cost-sharing agreement, working as independent business but and practising together under the name Josephson Angus Barristers.
Lori Bradshaw and John Bradshaw, who is now deceased, hired Angus, but not Josephson, in 2006 to represent them in a litigation. Angus and the Bradshaws never had a written retainer agreement.
Angus, who was experiencing some health problems at the time, asked Josephson to assist with the case, which he did. However, Angus still did the vast majority of the work.
During the litigation, Angus sent the Bradshaws a number of bills, which they paid. But in 2008, Angus stopped sending bills to the Bradshaws.
The Bradshaws allege it wasn’t until part-way through the actual trial in 2008 that Josephson sent them a number of letters stating Angus and Josephson were owed money and Angus would stop representing the Bradshaws if they didn’t pay. The Bradshaws eventually paid Angus more money and retained him as their counsel.
Angus eventually fell behind on his cost-sharing agreement with Josephson. Josephson got a judgment against Angus for nearly $180,000, and on April 26, 2010, the two entered into an agreement that Angus would pay back the money through fees earned from the Bradshaw case. Neither of them told the Bradshaws about the agreement until years later.
The Bradshaws were largely successful in their litigation, which ended Oct. 1, 2010.
The Bradshaws entered into a fee agreement with Josephson Angus Barristers on July 10, 2010, which has become the central tension in the case. The fee agreement included two draft bills totaling $389,006.15.
The Bradshaws claim that fee agreement is unenforceable for a number of reasons, including the claim they never received a final bill and Josephson Angus Barristers is not a formal legal entity.
“Josephson Angus Barristers is not entitled to a payment order or charging order becaue it is not a lawyer and because it was not retained by the Bradshaws to prosecute or defend a proceeding in which property was recovered,” reads an amended response to the civil claim.
The plaintiffs disputed that notion, arguing that a judge earlier in the litigation had recognized that “Josephson Angus Barristers” is a “trade name for the two law corporations acting in association.”
In a pre-trial hearing, Keighley allowed the defendants to make a number of amendments to their response to the civil claim. The trial is expected to last 10 days.