Lawyer should have warned client about mounting costs

The Ontario Divisional Court has refused to allow the appeal of a disbarred Toronto lawyer who was found to have “churned” a family law file.

Lawyer Roderick Byrnes, who had previous professional misconduct convictions, should have warned his client about the “mounting costs” he was incurring while pursuing matters like divvying up household chattels and his preference to not have his spouse smoke in front of their children, Justice Janet Wilson ruled for the Divisional Court panel.

Byrnes received virtually all of his client’s share of proceeds from the sale of a matrimonial home to pay his account. Later, an assessment officer put the value of Byrnes’ work at zero and ordered him to return the funds to his client in addition to the cost of the assessment proceedings. With costs against him set at $48,586, Byrnes owed a total of $77,400 to his client. But the lawyer soon claimed bankruptcy and the client received nothing.

“The core criticism of Mr. Byrnes’ conduct is spending excessive amounts of time on matters that the client had no ability to pay for without adequate advice, information and direction from Mr. Byrnes,” Wilson wrote.

Even if his client wanted him to keep working on issues like the separation of household items — an issue that took 30 hours of work — Byrnes ought to have warned him about taking this “unwise course,” the court said.

There is no evidence that there were any discussions warning the client as to the mounting costs and that, notwithstanding the client’s desire to pursue the issue of division of chattels and the question of smoking in front of the children, that he risked losing his sole asset if he chose to pursue this unwise course.”

The term “churning,” — to deliberately charge fees that are not justified — is also used in the context of stockbrokers who trade clients’ shares not for sound investment reasons but solely to generate commission, explains Gavin MacKenzie, a lawyer at DLA Piper LLP.

The court’s references to the lawyer’s failure to warn his client are related to the finding of churning, says MacKenzie.

“A lawyer can’t charge a client of modest means large fees for spending time on issues such as these without warning the client how much it costs to do so, especially where, as here, the result is that the client’s share of the proceeds of sale of the matrimonial home, on which he is depending, are consumed by legal fees,” he adds.

Byrnes was ordered to pay $7,500 in costs for the appeal. His lawyer George Florea did not immediately respond to a request for comments.

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