Law Times

www.lawtimesnews.com Page 10 march 17/24, 2008 / Law Times Clients can assess accounts Limitations act doesn't override court's jurisdiction I f a client wants to assess your account, just consent to the assessment, no mat- ter how long it's been since you rendered the account. That appears to be the message to lawyers from the Ontario Court of Appeal in the recent case of Guillemette v. Doucet. "This was really a case in which we believed the limita- tion defence had legs," says James Morton of Toronto's Steinberg Morton Hope & Israel LLP. Morton represent- ed Peter Doucet of Timmins, Ont., whose account Laureine Guillemette sought to assess. Of course, the Court of Appeal, manifested in a three- member panel composed of jus- tices David Doherty, Stephen Goudge, and Susan Lang, didn't put the message quite that plain- ly or briefly. Instead, Doherty, who wrote the judgment, took 11 pages and 44 paragraphs to make the point. "As the court saw it, the issue was whether the Limitations Act overrode the court's inherent jurisdiction, and [it] came to the conclusion that it did not," says Sylvano Carlesso of Timmins' Carlesso Barazzutti, who with partner Lisa Barazzutti, acted for Guillemette. The case came to appeal after Superior Court Justice David Nadeau ruled special circum- stances warranted an assessment of Doucet's accounts, although almost three years had lapsed since she paid them. Guillemette retained Doucet in mid-December 2002 in a matrimonial dispute. He acted for her until June 2003. The lawyer billed $31,000 over the six months. All accounts were paid — the last before the end of June 2003. Still, Guillemette had complained regularly about the bills, withholding pay- ment on occasion until Doucet threatened to end his representation if she did not pay the accounts imme- diately. Soon after paying Doucet's last account, Guillemette saw another lawyer for assistance in assessing the bills, which she believed were much too high. The lawyer told her to hire someone in Cochrane, Ont., where Doucet's office was located at the time. However, Guillemette had been in bad health and was abusing pain medication dur- ing the period of the retainer. She ended up in hospital in September 2003 and testi- fied that it was almost a year before she could look after her affairs. She added that she was physically and emotionally unable to initiate the assessment until 2006. She, in fact, brought the application in March 2006, some 33 months after paying the last account. As Doherty saw it, the gov- erning issue was the applicabil- ity of the two-year limitation period in the Limitations Act to an application for an order directing the assessment of a solicitor's account pursuant to s. 4 of the Solicitors Act. Morton argued that the Limitations Act applied and that Guillemette's application was out of time. Nadeau disagreed and direct- ed an assessment. On appeal, Doherty upheld Nadeau's order, reasoning that the special-cir- cumstances exception in s. 4 of the Solicitors Act permitted an assessment beyond the two-year period in the Limitations Act. Section 4 prohibits an assess- ment more than 12 months after delivery of the account "except under special circumstances to be proved to the satisfaction of the court or judge to whom the application for the reference is made." Section 11 of the Solicitors Act adds that payment of a bill does not preclude an assessment "if the special circumstances of the case, in the opinion of the court, appear to require the assessment." The Limitations Act, which came into force Jan. 1, 2004, did not amend s. 4. But the act did provide that limitations found in individual statutes (with certain exceptions) were void if the claim at issue was one to which the Limitations Act applied. "Consequently, and subject to the transitional provisions in s. 24 of the Limitations Act, any limitation periods in the Solicitors Act do not apply to a claim to which the Limitations Act applies," Doherty wrote. Here, the Limitations Act did apply to Guillemette's claim. "I agree with the appellant's submission that the application brought by Guillemette falls within the phrase 'claims pur- sued in court proceedings' in s. 2 of the Limitations Act," Doherty concluded. However, s. 20 pro- vided that nothing in the Limitations Act affected a provision in another statute that extended, suspended, or otherwise varied the limita- tion period found in that other statute. As Doherty saw it, the "special circum- stances" qualifier was such a provision. "Consequently, while by virtue of s. 19 of the Limitations Act, the two-year limitation period in that act trumps the 12-month limita- tion period in s. 4, s. 20 of the Limitations Act preserves the 'special circumstances' exception set out in s. 4 of the Solicitors Act," Doherty concluded. Alternatively, because Guillemette's claim was based on acts occurring before Jan. 1, 2004, in respect of which no proceeding was commenced before that date, the transition provisions of the Limitations Act applied. Among other things, these provisions man- dated that "the former limita- tion period applies" if the claim was discovered before the effec- tive date of the statute. As Doherty saw it, the tran- sitional provisions foreclosed the operation of the two-year limitation period set out in s. 4 of the Limitations Act. "Guillemette's claim was dis- covered before Jan.1, 2004," Doherty wrote. "Under the terms of s. 24(5) any limitation period imposed on her action against Doucet had to be found in the Solicitors Act and not the Limitations Act. Section 4 of the Solicitors Act permitted the action assuming the judge found 'special circumstances' at any time after the accounts were delivered." In other words, Guillemette's claim was not time-barred. "I appreciate that my inter- pretation of the interaction of the Limitations Act and the Solicitors Act means that there is no absolute time bar against applications for the assessment of lawyers' accounts," Doherty wrote. "This may seem inconsistent with the purpose underlying the Limitations Act. "However, solicitors' accounts have always been treated differently than other debts and even other profes- sional accounts. A superior court has an inherent jurisdic- tion to review lawyers' accounts entirely apart from any statu- tory authority. That inherent jurisdiction was not subject to a time limit. My interpretation of the two acts preserves that status quo." While the passage of time would be a significant consid- eration in determining whether special considerations existed, time alone would not preclude review of lawyers' accounts where other circumstances compelled such a review. FOCUS James Morton says Laureine Guille- mette's case against limitations on getting an assessment of her lawyer's bills had legs. BY JULIUS MELNITZER For Law Times Law Times #MS07-06B – 7-7/8" x 4-7/8" Get Our Environmental Law Specialists on Your Team! Get Our Environmental Law Specialists * on Your Team! Our team of environmental lawyers includes 5 Environmental Law Specialists* We help you help your clients. Call us. 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