Law Times

June 23, 2008

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Law Times Earlug Ad 1/16/08 4:06 titleplus.ca 416-598-5899 1-800-410-1013 McKELLAR STRUCTURED SETTLEMENTS INC. www.mckellar.com 1-800-265-8381 www.mckellar.com ckellar_LT_Jan14_08.indd 1 $3.55 • Vol. 19, No. 21 1/8/08 3:03:02 PM Covering Ontario's Legal Scene BCE case 'gruelling' for lawyers Supreme Court fast-tracks appeal BY ROBERT TODD Law Times A top court dealt with questions surrounding the largest corporate transaction in Canadian history, stretched them to the brink. "Sleep, meals, children, and wife had to be pushed aside," says Markus Koehnen, a McMillan Binch Mendelsohn LLP lawyer who represented BCE bondholders. "The one thing you probably need for dvocates who worked on the BCE case at the Supreme Court of Canada say the expedited appeal, in which the like Koehnen, who says at least 24 lawyers and law students at his firm, along with two law clerks, were involved with the BCE file, which was received last October. "For everyone, it was probably one of the That put extreme pressure on top lawyers this, more than anything else, is just relentless tenacity. That's far more important than any particular legal background," he says. The Supreme Court agreed on May 26 to fast-track BCE Inc.'s application to appeal a May 21 Quebec Court of Appeal judgment that overturned a March 7 Superior Court decision. The appeal court ruling threatened a $52-billion buyout offer led by the Ontario Teachers' Pen- sion Plan. A response to that offer — which is considered the largest private-equity takeover to date — is due by June 30. At press time the top court had not rendered its decision. The appeal court overturned a trial judge's decision and found BCE's board of directors failed to take into account the interests of all the company's stakeholders when studying the bid. Jill Copeland, executive legal officer for the Supreme Court, says the court expedites leave applications "with some regularity," and notes that expedited cases are considered those in which a decision is rendered within two months of the application's filing, versus the three to four months it usually takes. 'When you have a $52-billion transaction — the biggest corporate transaction in Canadian history — and you have three days to do a factum, that's pretty tough,' says Markus Koehnen. be "dramatically expedited," says Copeland in an e-mail. For BCE, the court agreed on May 26 to accelerate the matter, granted leave to appeal on June 2, and heard the appeal June 17. However, in cases like BCE, applications can Court of Appeal, which also expedited the case. That stage was the easiest, he says, because lawyers at least had two or three weeks to focus solely on preparing their factums. Politics threatens federal judges' raises BY TIM NAUMETZ For Law Times OTTAWA — The system for fix- ing federal judicial salaries will be tainted with politics and "back to square one" if Ottawa rejects the latest report from an independent commission that urged a pay hike to $304,000 by 2011, says the Ca- nadian Bar Association. Justice Minister Rob Nicholson has until Nov. 30 to respond to the position of the Judicial Compen- sation and Benefits Commission, tasked with settling what may be the most contentious round of qua- si-bargaining since the commission was established nearly 10 years ago. After months of submissions and counter-submissions from both sides, the gap remained large by the time the commission sub- mitted its report to the govern- ment at the end of May. The recommendation for salary incoming president of the CBA. "If the government doesn't act that surfaced during the submis- sion process are any indication, the system established to take politics out of the equation may be in dan- ger of collapsing, says Guy Joubert, increases and indexing over a three- year period was only $3,000 less than the salary requested in a joint submission from the Canadian Ju- dicial Council and the Canadian Superior Courts Judges Association — but $17,000 more than they would get under the government's proposed formula. Puisne judges now earn $260,000 annually, following a 3.2 per cent hike last April 1, based on an industrial aggregate of salary in- creases in Canada. If the acrimonious positions on these recommendations it essen- tially nullifies the whole process," Joubert tells Law Times. "It's politi- cized and it brings it back to square one, which the parties have been trying to avoid all along." He noted the government's decision to base part of its argu- ment on fiscal limits caused by economic and social priorities that were part of the 2006 election campaign contradicts the criteria established by the Judges Act. Section 26(1.1) of the act states the commission must consider the prevailing economic conditions in Canada, financial security for judges to ensure judicial inde- pendence, salaries that will attract "outstanding" candidates, and "any other objective criteria" the commission deems relevant. "The whole purpose is to remove these salary disputes from an other- wise public forum that could be a highly charged, highly politicized process," says Joubert. The commission agreed with a CBA argument, contained in a submission it presented during hear- ings, that it would be dangerous to accept the Justice Department's position that political priorities of the government, taken from an election campaign platform, should be taken into account. "The government's contention that the commission must consider the economic and social priorities of the government's mandate in recommending judicial compensa- tion would add a constitutionally questionable political dimension more time to prepare than people had to pre- pare for this case." He notes that his team re- ceived BCE's written legal arguments, which ran 400 pages in length, during the trial and had no more than two weeks to respond. "We needed to tool up and decommission people on a regular basis," he says, adding that many lawyers had to be pulled off of other files to prepare modules of information for the BCE case, which the trial team had to condense. The tight timelines continued at the Quebec most gruelling cases they've ever worked on," he says. "People really needed to amass very large teams internally, to break things down among a large group of people." He says the case presented rare obstacles ever since the claim began on Oct. 10, 2007, with a trial getting underway at Quebec Superior Court on Dec. 3. Between those dates, his team received about 15 affidavits with exhibits "running into the thousands and thousands of pages." During the trial, the lawyers continued conducting out-of-court cross-examinations, and prepared written arguments, while at the same time dealing with issues of production "at a very late stage in the trial." Koehnen says, "Small claims court files get TitlePLUS title insurance and you, together we make real estate real simple. June 23, 2008 Inside This Issue 4 Beware 'Junk Science' 6 Double-Dipping 9 Focus On Family Law Quote of the week "If this tends to spark a round of companies saying, 'OK, it's cost-effective to sue individuals,' you may see a lot more of these lawsuits happen," — Susan Beaubien See 'Kudos', page 5 lawyer, Macera & Jarzyna LLP see Copyright, page 3 See Neutral, page 4 www.lawtimesnews.com

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