Cassels Brock & Blackwell LLP can now feel some sense of security about recovering its legal costs in Mauldin v. Cassels Brock & Blackwell LLP after the Ontario Court of Appeal changed the terms of the cost orders in the investment fraud case.

Ontario Court of Appeal (Photo: Gail J. Cohen)

The case, which saw Toronto businessman Robert Hryniak convicted of civil fraud, was back in the appeal court this week for a decision on who should pick up the legal tabs.

Cassels Brock and its former partner Jack Peebles were named as co-defendants for allegedly allowing Hryniak to access to the firm’s trust accounts as he wished. But while Hryniak was found guilty in a summary judgment and ordered to pay $2 million, the court dismissed a summary judgment motion against Peebles and the law firm, deciding the allegations against them must go to trial.

Two groups of plaintiffs, known as the Mauldin group and the Bruno group, sued Hryniak. Both groups had originally won in a summary judgment, but later, an appellate court reversed the decision in the Bruno case, which it sent to trial.

In October 2010, a Superior Court judge had ordered Hryniak to pay Cassels Brock and Peebles for their costs in both motions. The judge had used the Sanderson model to order costs, which follows that the losing defendant pays the cost of the successful defendants.

One of Hryniak’s grounds of appeal was that he shouldn’t have to pay the legal costs of his co-defendants in the Bruno motion. Cassels Brock and Peebles agreed with this appeal, arguing the Sanderson order is inappropriate since Bruno was unsuccessful with all three defendants.

The law firm also said “it is not fair and equitable for it to continue to bear the risk of non-recovery of costs payable by Hryniak under the Sanderson order,” according to the decision.

This week, the appeal court agreed.

“Since Bruno’s motion failed against all three defendants, we set aside the motion judge’s Sanderson order in respect of the costs of the Bruno motion,” the appeal court said.

“The Sanderson order reduced Bruno’s obligation to pay the costs awarded to Cassels Brock and to Peebles by $21,212.27 and $4,545.45 respectively. Bruno is now responsible for payment of these amounts. Hryniak’s obligations to Cassels Brock and Peebles are reduced accordingly.”

When reached by Legal Feeds, a Cassels Brock spokeswoman said the firm would not comment on matters before the courts.

The Supreme Court of Canada has heard and reserved Hryniak’s appeal in relation to the summary judgment in Mauldin case.

Upadate: May 13. Fixed comment from Cassels Brock.

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In a long-standing battle with the Law Society of Upper Canada, former lawyer Harry Kopyto took his case all the way to the Supreme Court of Canada, and ultimately lost.

Harry Kopyto has been denied the chance to argue his case at the Supreme Court of Canada.

Today the SCC dismissed his application for leave to appeal.

Kopyto sought to be grandfathered as a paralegal in Ontario after he was disbarred as a lawyer in 1989 for overbilling legal aid. The law society initiated a good character hearing, which Kopyto used to challenge the LSUC’s jurisdiction to regulate paralegals, arguing it violates the Constitution and federal competition laws.

The law society began regulating paralegals in May 2007.

“It actually restricted access to justice by giving lawyers a monopoly for legal services and legal advice and eliminating the more affordable competition, the paralegals,” Kopyto told Law Times in February 2011.

“They claim they took over because paralegals were committing criminal acts and were incompetent. I want to see that evidence but I don’t think it exists. It was no worse with paralegals than it was with lawyers. The real reason they did it was to advance their own economic agenda.”

The case has been through three separate hearing panels, beginning in late 2009, after Kopyto made repeated accusations of bias.

Kopyto filed a motion to stay the good character hearing, claiming the regulatory regime was unconstitutional. The law society then sought to have the motion quashed, which was granted by the hearing panel on the basis that the panel wasn’t competent to hear constitutional challenges as they are better suited for the courts.

Kopyto sought judicial review of this decision, but the Divisional Court sided with the hearing panel. So Kopyto took his statement of claim to the Ontario Superior Court seeking five declarations:

• that bylaw 4 of the Law Society Act constituted an “anti-competitive act” as defined in the Competition Act;
• that the LSUC had abused its position by restricting access to justice due to its assumption of regulatory jurisdiction over paralegals;
• that the LSUC acted in bad faith and was in a conflict of interest by dealing with the paralegal profession;
• that bylaw 4 was not in the public interest because it restricted paralegals’ practice, contrary to the enabling statute; and
• that bylaw 4 violated the constitutional right of access to affordable justice.

The court ultimately ruled against him. In November, the Ontario Court of Appeal also dismissed Kopyto’s appeal.

“[W]e see no possibility that the appellant’s attack on the constitutionality of the legislation can succeed,” stated the appeal ruling. “It is plain and obvious that this claim, no matter how drafted, is doomed to fail.”

For more on this story, read “Kopyto’s long battle with LSUC."

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British Columbia’s attorney general is not required to be a lawyer, the province’s appeal court has ruled.

The B.C. Court of Appeal yesterday said it would uphold the B.C. Supreme Court’s decision in Askin v. Law Society of British Columbia.

The case was sparked after Shirley Bond was appointed as acting attorney general in August 2011, before becoming minister of justice and attorney general in February 2012. She is the first woman to hold these positions in B.C.

B.C. resident Lesslie Askin believed Bond was unqualified to hold the post and contacted the law society, which rejected her complaint on the grounds it lacked the necessary jurisdiction.

Askin took the case to court as a self-represented litigant, arguing that Bond’s appointment was statute barred due to her lack of legal training, and the LSBC was incorrect to say it lacked jurisdiction.

In a decision last June, Justice Stromberg-Stein said the LSBC was correct and Askin’s overall petition was “devoid of merit.”

She added: “To conclude that only persons entitled to practise law qualify for the appointment as attorney general would impermissibly constrain the Crown prerogative of ministerial appointment exercised by the lieutenant governor and the lieutenant governor in council.

“Many predecessor attorneys general have been non-lawyers and non-practising lawyers,” she said.

Askin appealed the decision, basing her argument on four provincial statutes: the Constitution Act, the Attorney General Act, the Queen’s Counsel Act, and the Legal Profession Act.

Cameron Ward, whose firm represented Askin in her appeal, says he argued at the April 29 hearing that: “Applying all the principles of statutory interpretation, the only conclusion one can draw is . . . that the attorney general must have practised for five years and be entitled to have membership at the Law Society of British Columbia.”

A transcript of the decision is not expected for another two weeks, but the court confirmed to Legal Feeds the appeal was dismissed.

LSBC chief legal officer Deborah Armour told Legal Feeds in an e-mailed statement: “The Law Society’s position has been that the relevant statutes in the province did not require the attorney general to be a practising member of the law society and the B.C. Supreme Court was in agreement. Now, the Court of Appeal has agreed that there is no requirement for the attorney general to be qualified to practise law. The law society is content to have the matter once again resolved and to have confirmation of our interpretation of the Legal Profession Act and other statutes.”

Ward has been instructed by Askin to file an appeal with the Supreme Court of Canada against the latest decision.

He says: “There are some important constitutional and policy implications surrounding this issue as to who may be qualified to hold this position.”

The “primary importance” of the case was highlighted by the attorney general’s counsel during the appeal, he adds.

Bond is the fourth attorney general in the history of British Columbia who has had no legal education or training; federally and in other provinces this has only happened in “exceptional” circumstances, according to Ward. Lawyers have served as attorneys general in the U.K. since 1461, he notes.

Update 3:15 pm: Comments from LSBC

A controversial motion seeking action to expand the scope of paralegal practice was withdrawn hours before the Law Society of Upper Canada’s annual general meeting tonight.

(Photo: Shutterstock)

After intensive discussions over the past week with the law society and the Canadian Bar Association, the 10 paralegals who proposed the motion have decided it’s best not to go head with it, says John Tzanis, president of the Paralegal Society of Ontario.

“We had assurances from the law society treasurer and staff that everything we’re asking for is being done,” Tzanis says, adding that the paralegal group has also heard from OBA president Morris Chochla.

The motion would have asked the law society to look into training programs for paralegals so they can practise fully in areas like family law and immigration law.

Law Times recently reported on the fierce debate the motion had stirred between paralegals, who say it’s time they practised with fewer limitations, and lawyers who argue only law school can prepare a person for the kind of work they do.

“Lawyers and paralegals should be colleagues, we should be working together on all of these issues . . . not in opposition or going to a battle,” Tzanis told Legal Feeds. “It doesn’t make any sense . . . if we’re both fighting for access to justice for the public, why are we battling each other like this?”

The withdrawal of the motion is also meant to thwart the animosity that was expected at tonight’s meeting, which had been moved to a larger venue in expectation of unprecedented attendance due to the controversy.

“We’ve done so much to help build bridges and the last thing we wanted was to create a war of words,” said Tzanis. “I thought there will be some paralegals who don’t represent the majority of us or there will be some lawyers who don’t represent the majority going out there and making some comments that will put us back here.”

Tzanis also said the law society promised to communicate more openly about its follow through with the 2012 Morris report, which recommended creating training programs for paralegals that will allow them to practise more broadly.

Response on Twitter to the motion’s withdrawal was swift with a number of lawyers commenting that if the reason taking it off the table was the moblization of the bar against the motion, it shows the inherent conflict of having one regulator for both lawyers and paralegals.

“If Ontario benchers/lawyers mobilized against it, that is a massive conflict for @LawsocietyLSUC,” tweeted Mitch Kowalski. “And exactly why @LawsocietyLSUC has no business regulating paralegals in the first place.”

“Follow your heart.”

This was one of the main messages from last night’s Diverse Careers for Women in Law panel discussion at the Law Society of Upper Canada.

(l to r) Panellists Susan Lightstone, Elizabeth Jordan, moderator Ronda Bessner, Senator Elaine McCoy, Marla Burstyn, and Justice Miriam Bloomenfeld discuss diverse careers for women in law. (Photo: Heather Gardiner)

Hosted by the Women’s Law Association of Ontario, the panellists at this annual event shared their thoughts on issues women face in the legal profession, such as finding your career path, mentorship, and leaving private practice.

Ontario Court Justice Miriam Bloomenfeld told the audience to “remain true to your inner compass.” As a shy student, she said she hated law school but stayed the course and ended up finding her calling as a Crown attorney.

When she was appointed to the bench in December 2005, she said it was difficult to find a place for herself and remain who she was in this new environment, but she persevered and now has great relationships with the other judges, especially other female judges with whom she has built personal connections.

“Don’t do anything because you think it’s something you should do,” said Bloomenfeld.

On the other hand, don’t be afraid to take chances, they advised.

“Just say yes,” said Senator Elaine McCoy. “It’s a great way to move forward in life.”

When McCoy was a young woman, she said she didn’t know what she wanted to be but an older male lawyer suggested she go to law school. So she enrolled and it was one of the best decisions of her life.

Elizabeth Jordan, director at RBC Capital Markets Compliance, encouraged women to get into business, adding that a legal degree provides so many transferable skills that can be applied to other industries.

The women had differing opinions on how to get a mentor, but they all agreed it’s important to have mentors for every stage of your career.

Susan Lightstone, the senior educational consultant at the Ontario Court of Justice, said mentors will help push your career forward but you have to earn the right to be mentored. Don’t complain to your mentor, she advised, instead come to them with focused questions about your career.

Jordan said you should be strategic about the way you ask someone to be your mentor.

The panellists also acknowledged that for many women, it’s difficult to maintain a work-life balance in private practice. Marla Burstyn, vice chairwoman of the Ontario Health Services Appeal and Review Board, said she left private practice after having two children because she wanted more flexibility.

When considering leaving private practice, she said it’s especially important to network.

“The only way to land on something is to know what’s out there, to know your options,” she said.

For women contemplating leaving the legal profession altogether, Lightstone said “Don’t do it!”

After having her second child, she could only get four months of maternity leave and was forced out of the law due to health issues. To make ends meet, she became a freelance legal writer. It’s hard to get back into the legal profession once you leave, she said. So rather than leaving the law, “think about how you can work as a lawyer in a different way,” she told the audience.

“I always thought of myself as a lawyer [and] I am damn glad I never gave it up,” said Lightstone.

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It’s one bullet point buried deep in the Ontario budget but it could have big implications for the class action bar.

On page 290 of last week’s budget, under a section regarding consultations with the Ontario Securities Commission, it’s noted the government “plans to propose further changes to update the Securities Act.” That may include, “if needed, following current court cases that the government is monitoring closely, suspending the operation of the secondary market civil liability limitation period while leave to proceed is being sought.”

“My assumption is that it’s speaking to the Timminco case,” says Jeremy Devereux, a partner with Norton Rose Canada LLP, referring to Sharma v. Timminco Ltd., which denied a class action based on limitation period.

Devereux notes there are also three major cases going before the five-judge panel of the Court of Appeal.

“The government wants the public to know it’s an issue they’re aware of and state their position, which seems to be that if it turns out the limitation period does expire in three years, even though leave is being sought, it seems this government’s is saying they are going to change that.”

The cases include Silver v. Imax, Trustees of the Millwright Regional Council of Ontario Pension Trust Fund v. Celesetica Inc., and Green v. Canadian Imperial Bank of Commerce.

“It looks like they’re waiting to see what happens with the cases currently before the Court of Appeal,” he says. “If the Court of Appeal finds a way of saying that the limitation period does expire in three years — provided you’re actually seeking leave to appeal from the court — even if it hasn’t been granted yet, I presume the government would say there is no longer a problem, we won’t do anything.

“But if the Court of Appeal says no, the limitation period does expire within three years, if you have not obtained leave, the government will intervene and amend the legislation to make it clear the limitation period stops running while leave is being sought.”

If a plaintiff intended to commence a securities class action, once they served the materials for leave under the Securities Act, then it would have the effect of stopping the limitation period from running.

Devereux notes that Justice Katherine van Rensburg in Imax and Justice Paul Perell in Celestica both found a way to allow the cases to continue even though leave had not been granted within the three year period.

Last July, in Green v. CIBC, Justice George Strathy took a different position and refused to certify based on expiration of the limitation period. In his view of the law, he wasn’t able to allow the case to continue. However, he noted in his decision that if it had not been “time-barred” he “. . .would have granted leave to pursue the statutory cause of action, and would have certified this action as a class proceeding for that purpose.”

Other items noted in the budget regarding the OSC indicate there is interest in updating the Securities Act including:

• expanding the insider-trading and self-dealing provisions, including in relation to their application to investment funds
• updating disclosure requirements for the exchange traded funds to provide plain-language, concise and comparable disclosure to investors that is more consistent with requirements that apply to mutual funds
• updating early-warning reporting and related requirements for take-over bids to provide more transparency to regulators and the public.

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