[2] While a number of accounts were before the assessment officer, the only dispute that I am to deal with relates to an account dated October 17, 2009. This account was for services performed by Mr. Wilson for Ms. Edward relating to litigation with Allstate Insurance Company of Canada. The account in total, inclusive of fees and disbursements, was $336,626.13. After assessment, the account was reduced to $205,376.13.
[3] Mr. Wilson says that the assessment officer was wrong in that determination.
Background
[4] Ms. Edward retained Mr. Wilson with respect to her claim for motor vehicle accident benefits. He had taken over the file from an earlier lawyer. That lawyer had been able to obtain a proposed settlement from Allstate in the amount of $50,000 plus costs of $7,500 plus GST and disbursements. Ms. Edward responded to that offer advising “try to get more, otherwise we accept this offer”. That settlement did not proceed and Ms. Edward changed lawyers. After further extensive work carried out by Mr. Wilson, the matter was settled by Allstate paying $800,000 in addition to $252,000 for costs.
[5] Following the settlement, Mr. Wilson delivered a summary account in the amount of $300,000 plus GST of $15,000, plus a disbursement account of $20,632.46, plus GST for a total account of $336,626.13. In his evidence before the assessment officer, Mr. Wilson said that one part of that account was a $100,000 premium for significant success on his part.
[28] The only written document pertaining to fees was a May 5, 1997 letter sent to Ms. Edward’s spouse. At that time, Mr. Wilson was acting for both. In that letter he indicated that his fees were based on an hourly rate of $300.00 an hour, plus a correspondence fee of $20.00 per letter sent and $10.00 per letter received.
[29] With respect to this issue, the assessment officer said:
While a client may have a right to rely on the general terms of a retainer to continue to apply until a new agreement is reached or, at least, notice of a change is given, it would be unreasonable to believe that an hourly rate will continue to apply for 12 ½ hours. It might be argues that it was an error in principle to allow increases in an hourly rate where there has been no notice, even to the extent of escalating rates being disclosed in a series of interim bills. However, it would be patently unreasonable to find any client so naïve as to believe that an applicable hourly rate would not escalate over the passage of 149 months.
[30] The assessment officer went on, as set out above, to allow Mr. Wilson the rate of $500.00 per hour. In my view, he was not wrong in finding that to be a reasonable expectation of the client.
[31] It is clear that Mr. Wilson did not provide Ms. Edward with any assessment as to what the premium might be. The assessment officer did find that “for outstanding success”, $50,000.00 was the appropriate amount.
[32] That amount, to one surviving on public assistance, is a staggering premium. While it may be that Mr. Wilson would have a reasonable expectation of a $100,000 premium, that is not the test. If he expects such a premium, he has an obligation to bring that to the attention of the client, preferably in writing. For his own reasons, as set out in his evidence, he generally does not use a written retainer. That may be honourable, but it is bad business in these circumstances.
[33] I do accept the evidence of Mr. Wilson that a premium was discussed; the evidence of Ms. Edward and her spouse cannot be relied upon. Given that the assessment officer allowed for a premium, he too did not accept their evidence on this point. In light of the significant success, a premium of 10% of the recovery could be expected. See: Treyes v. Ontario Lottery and Gaming Corporation (2007) 49 C.P.C. (6th) 400 (Ont. S.C.J.). The premium is allowed at $100,000. Accordingly, the fee is determined to be $250,000.
[34] The report and certificate of the assessment officer dated April 24, 2014 is otherwise confirmed.