Summary

Keywords

Civil procedure – Class actions – Certification – Law of professions – Barristers and solicitors – Costs – Legal fees – Contracts – Breach – Breach of fiduciary duty – Former client seeking to certify class action against law firm that represented her on contingency fee basis – Whether the Court of Appeal erred by dismissing the firm’s appeal and upholding the order of the Divisional Court certifying this case as a class proceedings – Whether the Court of Appeal erred by granting former client’s cross-appeal in part and certifying additional common issues relating to breach of fiduciary duty and punitive damages – Whether the proposed appeal raises issue of national importance about the court’s gatekeeper role in modern class actions practice across the country – Whether the Court of Appeal’s decision creates a conflict of appellate opinion as to the application of this Court’s jurisprudence regarding claims for breach of statute, the case being premised entirely on an alleged breach of a comprehensive statutory regime – Whether the Court of Appeal’s decision substantially expands the law of disgorgement, calling into question the right of lawyers to receive quantum meruit compensation for valuable work undertaken for their clients – Whether the Court of Appeal’s decision raises an important question as to whether a class proceeding can be the preferable procedure in circumstances where certification would compromise the substantive rights of absent class members, in this case solicitor-client-privilege – Whether the Court of Appeal erred by failing to afford deference to the certification judge, creating confusion on an important issue of appellate review – Solicitors Act, R.S.O. 1990, c. S. 15, ss. 28.1(8), (9), 33 – Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 5(1).

Summary

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Ms. Hodge was injured in a motor vehicle accident and retained the law firm Neinstein & Associates to represent her. The contingency fee agreement that Ms. Hodge signed with the law firm entitled the firm to a percentage of damages recovered on her behalf, costs and disbursements. Ms. Hodge’s accident benefits claim settled for $85,000. She received $66,089.49 from that amount, and the law firm deferred a portion of the fees due to be repaid from the settlement or judgment in the tort action. Ms. Hodge’s tort action settled for $150,000. She received $41,906.41 of that amount, after legal fees, costs and disbursements plus interest on disbursements.

Ms. Hodge brought a motion to certify a class proceeding against the law firm on behalf of all its contingency fee clients since October 2004. She sought a declaration that the contingency fee agreement and the amounts charged are in violation of ss. 28.1(8) and (9) and 33 of the Solicitors Act, R.S.O. 1990, c. S. 15. She further alleged a breach of fiduciary duty and a breach of contract, and sought an order that the firm repay any costs in addition to a percentage of damages.

Lower Court Rulings