IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20120611

Docket: S115568

Registry:
Vancouver

Between:

Ron Perrick Law
Corporation 

Solicitor

And

Sandra McKeachie

Client

Before:
Master MacNaughton

(Sitting
as Registrar)

Reasons for Decision

The Application

[1]            
Sandra McKeachie applied under the Legal Profession Act, S.B.C. 1998,
c. 9 (“LPA”) for a review of a June 10, 2011 account from the Ron
Perrick Law Corporation (“RPCL”).

[2]            
Mr. Perrick, through his professional services corporation RPCL, represented
Ms. McKeachie, and her daughter, with respect two motor vehicle accidents, the
first in 2002 and the second in 2004. In these reasons, I will refer to these
motor vehicle accidents as MVA #1 and MVA #2.

[3]            
The account in question was paid out of $25,226.19 settlement proceeds
received from the Insurance Corporation of British Columbia (“ICBC”) for Ms.
McKeachie’s claims with respect to MVA #1. The total account was for $5,226.19.
The fee portion of it totals $4,331 representing fees of $3,866.96 plus
applicable PST and GST of $464.04. Ms. McKeachie accepts that, on her behalf,
Mr. Perrick incurred taxable and non-taxable disbursements totalling $895.19
and does not dispute that portion of the account.

The Parties General Positions

[4]            
It is Ms. McKeachie’s position that, as a result of Mr. Perrick’s
neglect of her claims, and the conflict of interest he found himself in when
recommending that Ms. McKeachie accept ICBC’s settlement offer for MVA #1, he
should be denied any fee. In particular, she submits that her claim was worth
considerably more than what she settled for and that she only accepted the
settlement offer after Mr. Perrick told her that if she did not do so, there
was a chance she might get nothing.

[5]            
Mr. Perrick denies that he neglected Ms. McKeachie’s claims and believes
that the settlement which was offered for MVA #1 was fair in all the
circumstances. In addition, he says that Ms. McKeachie is still able to pursue
her claim for MVA #2, an action which he commenced, and it is open to her seek
damages in that action including those arising from her continued inability to
work. As will become apparent, that is a key point in issue between these
parties.

[6]            
Before turning to the facts giving rise to this dispute, I make some
general observations. I was advised during the submissions that Ms. McKeachie
has also commenced a negligence action against Mr. Perrick and RPCL. There was
no application to stay these proceedings pending the outcome of the negligence
action even after I raised that possibility with them. Mr. Perrick did suggest
an adjournment but did not pursue it.

[7]            
My role on a LPA review of a solicitor’s account is not to determine
whether the solicitor was negligent in his conduct of the client’s legal
matters. It is solely to determine the reasonableness and propriety of the
steps taken and to assess the value of the legal services provided. However, in
reaching a conclusion about the necessity and propriety of the work performed in
this case, as well as of the quality and value of that work, Ms. McKeachie’s
specific complaints make it necessary, to an appropriately limited extent, to
examine Mr. Perrick’s conduct of the litigation.

[8]            
Ms. McKeachie filed an affidavit and testified about her involvement
with Mr. Perrick. In response, Mr. Perrick testified and filed two affidavits
from his legal assistant which served the primary purpose of attaching relevant
documents. Neither party called any expert evidence.

The facts giving rise to the retainer

[9]            
Ms. McKeachie and her daughter were involved in two motor vehicle
accidents; MVA #1 on April 9, 2002 and MVA #2 on December 2, 2004. In both
accidents, Ms. McKeachie’s vehicle was rear-ended and liability was admitted. She
and her daughter suffered soft tissue injuries in both accidents.

[10]        
I will deal first with the injuries which resulted from MVA #1. Ms.
McKeachie said that she experienced neck and lower back injuries. While she
acknowledges that her neck pain resolved, she testified that the pain in her
lower back did not and that she suffered, and continues to suffer, disabling
chronic back pain which has prevented her from working.

[11]        
At the time of MVA #1, Ms. McKeachie was employed as an office worker
with BC Children and Women’s Hospital working 35 hours a week. She had only
relatively recently returned to the workforce after staying at home with her
children and working intermittently.

[12]        
Following MVA #1, Ms. McKeachie testified that she was off work until
early 2003 when she returned to work despite continuing and considerable pain. She
testified that her employer modified her job duties to accommodate her
difficulties but she went off work again in September of 2003 because she felt
unable to cope with the pain and fatigue. Ms. McKeachie testified that, apart
from some attempts to return to work, and temporary work for Elections Canada
and Elections BC, she has been unable to work at any job since MVA #1.

[13]        
Initially, Ms. McKeachie dealt directly with the ICBC adjusters. In September
2003, she decided to retain Mr. Perrick with respect to claims arising from MVA
#1.

[14]        
Mr. Perrick had earlier represented Ms. McKeachie with respect to a 1996
accident. His name had been given to her by her husband who knew Mr. Perrick
professionally. A settlement of that case was reached in May 1999 and Ms.
McKeachie was satisfied with the relationship and the outcome.

[15]        
Ms. McKeachie did not meet Mr. Perrick at any time during this initial
retainer. Nor did she meet Mr. Perrick with respect to the retainer for MVAs #1
or 2. In fact, she testified, and Mr. Perrick did not dispute, that apart from
the two appearances on this LPA assessment, and one other occasion when
they met incidentally, Ms. McKeachie had never met Mr. Perrick. This fact will
become important later in these reasons.

[16]        
Ms. McKeachie testified that, when she contacted Mr. Perrick in
September 2003, she told him that she had been unable to work and that her back
was still sore. She was attending her doctor frequently and was receiving
various ongoing treatments including massage therapy, acupuncture and
physiotherapy. She had also attended the Back Institute. She advised Mr.
Perrick that ICBC had offered her a settlement of $25,000 and expenses for her
medical treatments. She testified that Mr. Perrick told her that she had a “six
figure” claim, or used words to that effect, and that he would take the case on
a contingency fee basis. She testified that they did not discuss fees and she
did not sign a contingency fee agreement. None was in evidence and the account
does not reflect a contingency fee arrangement.

[17]        
Mr. Perrick denies that he told Ms. McKeachie that she had a significant
claim and said that when she first contacted him, ICBC’s offer was only for
$3,500. In addition, Mr. Perrick testified that Ms. McKeachie said either that
she did not wish to return to work or that she was not interested in working
any longer. Mr. Perrick also testified that Ms. McKeachie indicated that she
wished to continue to deal with ICBC directly. Mr. Perrick did not produce any
notes of his initial conversation with Ms. McKeachie and he did not write to
her to confirm their discussions or his retainer.

[18]        
Mr. Perrick’s understanding of his limited retainer is confirmed to a
certain extent by his March 25, 2004 letter to ICBC’s assigned adjuster. He
confirmed that, to protect Ms. McKeachie’s and her daughter’s claims, he would issue
a Writ on their behalf but would not do anything else because Ms. McKeachie and
her daughter wished to continue to communicate directly with ICBC with respect
to their recovery progress and settlement.

[19]        
I accept Ms. McKeachie’s evidence that she believed from her discussions
with Mr. Perrick that she had a significant claim.

[20]        
I do not accept that Ms. McKeachie told Mr. Perrick that she did not wish
to return to work. I prefer Ms. McKeachie’s evidence in this regard. It is more
likely that, as she said in her evidence, she told Mr. Perrick that she wished
to return to work but was unable to do so. It is apparent from her earnings
history that in the year following MVA #1, Ms. McKeachie did in fact attempt to
return to work. Those efforts are inconsistent with a stated desire not to
return to the workforce. Further, if that was her advice to Mr. Perrick, because
of its importance to any recovery for loss of past or future income, I would
have expected it to be recorded somewhere in Mr. Perrick’s file or to have been
the subject of correspondence between them explaining her obligation to
mitigate any loss of income claim and the impact her failure to do so would
have on such claims.  Mr. Perrick has not produced any file notes from his
initial communications with Ms. McKeachie in September 2003.

[21]        
Ms. McKeachie testified that she advised Mr. Perrick that she wanted to
find out the “maximum” offer she could get from ICBC to determine a “base
amount” and so she would know if Mr. Perrick could obtain a better offer for
her. She testified that she never told Mr. Perrick that she wished to
exclusively continue to deal with ICBC. This misunderstanding of what Ms.
McKeachie intended and what Mr. Perrick understood of the nature of his
retainer could have been cleared up if he had confirmed her instructions in
writing at the time of the initial retainer, if they had met in person, or if
Mr. Perrick’s March 25, 2004 letter to the ICBC adjuster had been copied to Ms.
McKeachie. The letter does not indicate that it was so copied and Mr. Perrick
did not say that it was.

[22]        
In her affidavit and her evidence, Ms. McKeachie complains that she
heard very little from Mr. Perrick about her claims from MVA #1. She did not
receive any correspondence or copies of correspondence. Mr. Perrick’s file,
which was produced on this assessment, does not indicate ongoing communication
with Ms. McKeachie.

[23]        
Mr. Perrick issued a writ of summons with respect MVA #1 on March 31,
2004. It is not clear from the evidence when the writ was served but, in any
event, on December 15, 2004, the defendants filed a statement of defence.

[24]        
In September 2004, Ms. McKeachie attended a defence medical examination
with Dr. Bernard Tessler, a neurologist. The record and the evidence do not
indicate how the examination was arranged.

[25]        
Dr. Tessler’s medical report indicated that Ms. McKeachie’s neck pain
had subsided by July or August 2002 but that her low back pain persisted. The
report also indicated that Ms. McKeachie missed the first six weeks of work
after MVA #1 and then returned to work on lighter duties. Dr. Tessler recorded
that she continued to miss a few days depending on her work schedule. Her
injuries affected her ability to do house work and gardening. She described
discomfort at night when turning and that sometimes the pain would awaken her. In
his conclusions, Dr. Tessler said:

As a result of the motor vehicle accident on April 9, 2002
the patient sustained the following injuries:

1. Soft tissue cervical strain injury which resulted in
cervical discomfort and some headaches arising from the cervical structures. There
was no evidence of nerve root or spinal cord injury.

2. Soft tissue ligamentous or myofascial injury of the lumbar
spine. There is no evidence of nerve root irritation or compression.

The symptoms of the cervical spine had resolved by July or
August 2002. She still has persistent discomfort in the lumbar area. It is
aggravated if she is sitting for a prolonged period of time or standing for prolonged
periods of time. She finds that she is not able to do as much sustained
physical activity as she could previously, but still is capable of the
gardening and house cleaning. She is able to do lifting. Her injury resulted in
not being able to work for six weeks, but she did return back to work, but in a
more clerical type of position.

I anticipate that the symptoms in the lumbar area will
gradually dissipate.

She had a period of temporary
disability of approximately six weeks and partial impairment but no disability
at this time.

[26]        
It is not disputed that in October 2004, Ms. McKeachie’s daughter
settled her claim arising from MVA #1 for $6,000. Ms. McKeachie agreed that the
settlement had been arranged by her daughter directly with ICBC. Mr. Perrick
testified that he had very little involvement in this settlement.

[27]        
As set out above, in December 2004, Ms. McKeachie and her daughter were
involved in MVA #2. Ms. McKeachie asked Mr. Perrick to also represent them with
respect to it.

[28]        
On December 9, ICBC issued a formal demand for discovery of documents
and notice to produce with respect to MVA #1.

[29]        
On December 14, and again on March 3 and April 4, 2005, ICBC’s counsel
wrote to Mr. Perrick with respect to MVA #1 requesting a statement of claim,
Ms. McKeachie’s list of documents, and to arrange dates for examinations for discovery
and trial.

[30]        
Mr. Perrick testified that on March 2, 2005, Ms. McKeachie called him
and advised him that the ICBC adjuster was discussing an all-inclusive
settlement offer in the range of $25,000 including a wage loss component. He
next spoke to Ms. McKeachie on April 4, 2005 when she called him and told him
that she had received Dr. Tessler’s report which concluded that there was
nothing wrong with her. Shortly thereafter, Mr. Perrick received a copy of Dr.
Tessler’s report and an MRI from Ms. McKeachie.

[31]        
On July 8, Mr. Perrick prepared a statement of claim on Ms. McKeachie’s
behalf.

[32]        
On October 14, counsel for ICBC again wrote to Mr. Perrick with respect
to MVA #1 asking for Ms. McKeachie’s list of documents and to set up mutually
convenient dates for examinations for discovery and trial. The letter also
invited a settlement proposal from Ms. McKeachie. Mr. Perrick did not produce
any file records which indicated that he discussed ICBC’s invitation with Ms.
McKeachie and he did not testify about any such discussion. Ms. McKeachie did
not make a settlement proposal.

[33]        
On November 3, an ICBC adjuster wrote to Mr. Perrick indicating that
voice mail messages had been left with his office on October 24 and 27 inquiring
whether Mr. Perrick was representing Ms. McKeachie with respect to MVA #1 and indicating
that if it did not hear within ten days, ICBC would deal directly with Ms.
McKeachie.

[34]        
Mr. Perrick testified that he responded ICBC that he would be
representing Ms. McKeachie. On December 8, ICBC confirmed that advice and again
requested a list of documents and dates for examinations for discovery and
trial. The letter advised that if these matters had not been dealt with by the
end of the year, ICBC would seek a court order and would set unilateral dates.

[35]        
Ms. McKeachie testified that she was not aware of any of this
correspondence and only learned of it when she filed this appointment to assess
of Mr. Perrick’s account. Mr. Perrick did not say that he copied Ms. McKeachie
with the correspondence and there are no letters indicating that he did so. I
find that Ms. McKeachie was not aware of the correspondence from ICBC.

[36]        
On December 28, Ms. McKeachie advised Mr. Perrick that her daughter had
been involved in another accident and ICBC was holding her daughter totally responsible
for it. Mr. Perrick contacted ICBC and negotiated at 50-50 split of liability
with respect to that accident. Ms. McKeachie agreed that he had done so. There
appears to have been no further action of Ms. McKeachie’s claims until April
2006.

[37]        
On April 3, 2006, ICBC sent Mr. Perrick a formal offer to settle the
claims arising from MVA #1 for $25,000 plus costs. Mr. Perrick testified that,
on receipt of it, he discussed ICBC’s offer with Ms. McKeachie but she disputes
this. There is no letter from Mr. Perrick conveying the settlement offer to Ms.
McKeachie nor did he produce any file notes of a conversation with her about it.
I accept Ms. McKeachie’s evidence that she was not aware of the formal offer to
settle.

[38]        
Mr. Perrick said that in July 2006, Ms. McKeachie advised him that her
daughter, who was in need of the money, wanted to settle her claim with respect
to MVA #2 and that he was not involved with that settlement.

[39]        
On July 11, 2006, ICBC delivered a notice to mediate with respect to MVA
#1. Mediation never occurred.

[40]        
On September 26, 2006, ICBC wrote to Mr. Perrick setting out the history
of the processing of the MVA #1 claim. ICBC indicated that:

…due to the lack of attention
to this matter, as well as your lack of cooperation in moving this matter
forward in an expeditious manner, we have no choice but to bring on an
application to dismiss this matter for want of prosecution.

[41]        
ICBC did not then apply to dismiss Ms. McKeachie’s claim.

[42]        
In late November 2006, Mr. Perrick issued a writ with respect to MVA #2.

[43]        
In February 2007, ICBC wrote to Mr. Perrick expressing their frustration
that they had not been able to contact him to schedule mediation. He was
advised that if a mediation date was not scheduled within the next 21 days,
ICBC would apply to dismiss the action. No such steps were taken by ICBC.

[44]        
There then appears to be a further gap in the processing of Ms.
McKeachie’s claims. In early August 2008, ICBC scheduled a mediation for September
22. That mediation did not proceed.

[45]        
The evidence did not disclose when the MVA #2 writ was served but, on
October 2, 2008, ICBC filed an appearance on behalf of the defendant.

[46]        
On November 8, 2008, counsel for ICBC wrote asking for February 2009 dates
for examination for discovery of Ms. McKeachie in both actions and requesting a
list of documents with respect to MVA #1. The letter threatened that if it did
not receive a list by November 15, 2008, it would apply to compel one. The
letter enclosed a demand for discovery of documents and notice to produce with
respect to MVA #2 and requested particulars of lost income and special damages.

[47]        
On November 25, 2008, in both actions, ICBC demanded particulars of Ms.
McKeachie’s special damages and past income loss from April 9, 2002 to November
19, 2008.

[48]        
On January 29, 2009, ICBC served a February 5, 2009 appointment to
examine Ms. McKeachie for discovery with respect to both accidents and a demand
for particulars. As ICBC did not receive a response to its letter, on February
2, 2009, counsel sent Mr. Perrick a fax asking whether he wished to reschedule
the discovery. As conduct money had not been delivered with the appointment,
ICBC rescheduled the discovery for February 23, 2009.

[49]        
On February 4, 2009, ICBC applied to dismiss Ms. McKeachie’s claims with
respect to both accidents. With respect to MVA #1, it also sought a list of
documents. ICBC sought special costs payable by Ms. McKeachie in any event of
the cause. With respect to both actions, ICBC’s affidavits in support
chronicled all of the various requests for examinations for discovery and
documents that are set out above.

[50]        
The February 23 examination for discovery did not proceed. That day, ICBC’s
counsel spoke to Mr. Perrick who indicated that he thought the discovery had
been cancelled because he had left a message that he was in trial. Mr. Perrick
indicated that his office had moved and that he had not received ICBC’s
dismissal application materials.

[51]        
Ms. McKeachie testified that she was never made aware of the various requests
for documents and that she be examined for discovery nor was she advised of
ICBC’s threats to apply to dismiss her claims.

[52]        
On April 27, 2009, counsel for ICBC again requested new dates for the
examination for discovery of Ms. McKeachie and that Mr. Perrick provide answers
to ICBC’s numerous requests for particulars and file a statement of claim in
MVA #2. On July 15, 2009, Mr. Perrick left two numbers at which he could be
reached but, according to the affidavit filed in support of ICBC’s next
application to dismiss Ms. McKeachie’s claim, counsel never spoke.

[53]        
Mr. Perrick testified that, on August 12, 2009, he spoke to Ms.
McKeachie about her loss of income claim with respect to MVA #1 and advised her
that they would have a difficult time making a claim for income loss. He said
that, between 1998 and 2003, her best earning year had been 2003, the year
following the accident. Mr. Perrick said that Ms. McKeachie said that she
really wasn’t too interested in working. A copy of the only file note in
evidence from Mr. Perrick’s file indicates that between August and September
2003 Ms. McKeachie: “had shifts scheduled – had to sit for 8 hours/day” it then
goes on to say “couldn’t do! – tried to do – couldn’t do them!”  There is no
reference in that note to Ms. McKeachie indicating that she was not interested
in working.

[54]        
On August 14, 2009, Mr. Perrick filed a statement of claim with respect
to MVA #2.

[55]        
Ms. McKeachie testified that in September 2009, Mr. Perrick telephoned
her and told her that with respect to MVA #1, ICBC had made an offer of $25,000
and that their lawyers were “up to some funny business” and that she had better
take the $25,000 or she might end up with nothing. She said that she was
startled and confused. She could not understand how her claim for an accident,
which was not her fault, and which had cost her so much in suffering and loss
of income, could be in jeopardy and resolved for so little. She said that she reluctantly
agreed to the settlement and then heard nothing from Mr. Perrick. Her calls to
his office were not returned. I accept her evidence that when discussing the
settlement, Ms. McKeachie did not understand the nature of the “funny business”
Mr. Perrick said ICBC’s lawyers were up to. Certainly there was no
correspondence from Mr. Perrick explaining the circumstances or his
recommendation that she accept the settlement.

[56]        
Mr. Perrick testified that he was pleased to learn that ICBC’s formal
offer to settle, which Ms. McKeachie accepted, only related to MVA #1 because,
in his view, it remains open to Ms. McKeachie to argue that any continuing loss
of income was as a result of an exacerbation of her injuries in MVA #2.

[57]        
On September 17, 2009, Mr. Perrick and counsel for ICBC appeared before
Master Taylor who, with respect to MVA #2, ordered that Ms. McKeachie prepare a
list of documents within 7 days and allowed ICBC to reset its application to
dismiss the action. ICBC’s claim for special costs was reserved for the next
application date.

[58]        
On September 21, 2009, counsel for ICBC wrote to Mr. Perrick confirming
Ms. McKeachie’s acceptance of the formal offer to settle with respect to MVA #1.
ICBC took the position that it was seeking costs and disbursements from Ms.
McKeachie from April 3, 2006, the original date of the offer, and September 18,
2009, the date of acceptance. ICBC acknowledged that the applicable rules had
changed but raised the prospect of claiming double costs, at least with respect
to certain steps taken in the action. ICBC indicated that the costs and
disbursements would be significant. ICBC indicated that it understood from Mr.
Perrick that Ms. McKeachie would consider an offer to settle both actions and
indicated that it was prepared to offer $25,500 in settlement of both actions,
inclusive of all costs and disbursements. There is no indication in the
evidence or the materials of whether this position was ever discussed with Ms.
McKeachie or that she understood that she might be at risk for significant
costs.

[59]        
On September 23, 2009, Mr. Perrick served Ms. McKeachie’s list of documents
for MVA #2. Copies of those documents were delivered on October 22, 2009.

[60]        
On June 8, 2010, Mr. Perrick demanded payment of the settlement sum for
MVA #1 forthwith and argued that Ms. McKeachie was entitled to her costs up to
April 3, 2006. Mr. Perrick indicated that his instructions were to apply for an
order for payment if the funds were not received within 10 days. Mr. Perrick
did not testify about how he obtained those instructions. In any event, no
application was brought.

[61]        
On December 10, 2010, Mr. Perrick wrote to ICBC’s counsel enclosing an
invoice for a particular disbursement and confirming that Ms. McKeachie was
prepared to set off all costs, other than this disbursement, and to explore a
possible settlement of MVA #2 after she received her settlement funds for MVA #1.
There was no evidence about any discussions between Mr. Perrick and Ms.
McKeachie in this regard.

[62]        
On February 2, 2011, Mr. Perrick wrote to Ms. McKeachie enclosing
correspondence to ICBC. He indicated that he thought the matter had been
resolved in December but he was considering applying to court to force ICBC to
pay the settlement. This letter suggests that despite his June 8, 2010 letter, he
did not have earlier instructions to bring such an application.

[63]        
On May 4, 2011, Mr. Perrick forwarded the ICBC form of release to Ms.
McKeachie and indicated that he would draft an account for discussion purposes.
She signed and returned the release on May 25, 2011.

[64]        
On June 10, 2011, Mr. Perrick sent Ms. McKeachie his trust cheque in the
amount of $20,000 and his proposed form of account. Although it is referred to
a “proposed account”, in fact, the account had been paid in full from the
settlement funds. In his letter conveying the trust cheque, he referred to their
discussion in August 2009 about her income both before and after the accidents
and said that it became apparent that she would have a “tough row to hoe” with
respect to future and present income loss. He indicated that he had prepared a
summary of this and said “we can discuss it again after you’ve had an
opportunity to consider the content of this letter”. I presume Mr. Perrick was
referring to his handwritten notes about Ms. McKeachie’s annual income between
1998 and 2003 as no other summary was in evidence before me. Mr. Perrick also wrote
that ICBC was prepared to pay her $10,000 for MVA #2 but he was not sure what
they could negotiate in terms of an all-inclusive settlement. He indicated that
they now had Dr. Greenwood’s clinical records and that they could “try and
present [ICBC] with a proposal with respect to some income loss”.

[65]        
Ms. McKeachie deposed in her affidavit and testified that until she
retrieved her file from Mr. Perrick, she was not aware of the level to which it
had been neglected and that in September 2009, when Mr. Perrick recommended the
settlement in MVA #1, he did not tell her about the defendants’ pending
applications to strike out her claims. She said that if she had known the truth
of the situation, she would have sought a second opinion before accepting the
settlement.

Applying s. 71 of the LPA to the circumstances of this case

[66]        
A review of a lawyer’s account is undertaken pursuant to the provisions
of the LPA. On such a review, a registrar is to allow the solicitor to
charge such fees, charges and disbursements as she considers reasonably
necessary and proper to conduct the proceeding or business to which they
relate. She is also to consider all of the circumstances of the matter
including these factors set out in s. 71(4):

(a)  the complexity, difficulty or
novelty of the issues involved,

(b)  the skill, specialized
knowledge and responsibility required of the lawyer,

(c)  the lawyer’s character and
standing in the profession,

(d)  the amount involved,

(e)  the time reasonably spent,

(f)   if there has been an
agreement that sets a fee rate that is based on an amount per unit of time
spent by the lawyer, whether the rate was reasonable,

(g)  the importance of the matter
to the client whose bill is being reviewed, and

(h)  the result obtained.

[67]        
Before turning to the specific considerations on review of a solicitor’s
account under s. 71(4) of the LPA, there are a number of general
conclusions that I can make as they relate to the necessity and propriety of
the steps taken by Mr. Perrick in furtherance of Ms. McKeachie’s retainer.

[68]        
First, Mr. Perrick never met Ms. McKeachie during the more than seven
years during which he represented her with respect to MVAs #1 and 2. Despite
his evidence that his initial retainer was limited in scope, there was no
written retainer agreement or letter to Ms. McKeachie confirming their
arrangements. There was no agreement on an hourly rate or on a contingency fee.
In fact, the account does not set out an hourly rate. It indicates that a total
of 66 hours was spent on Ms. McKeachie’s behalf and that the fee for those
hours is $3,866.96. On an hourly basis that is a rate of $58.59. One is left to
conclude that the account was set at an amount to ensure that Ms. McKeachie
received $20,000 from the total settlement proceeds from ICBC which were
$25,226.19. Out of that $20,000, more than $5,000 represented Ms. McKeachie’s
special expenses and 16 days of lost wages as reflected in Ms. McKeachie’s
handwritten notes which were sent to Mr. Perrick and filed in evidence.

[69]        
Second, it is apparent from the chronological record of the processing
of Ms. McKeachie’s claims that there were a number of significant delays. These
included delays in issuing a statement of claim with respect to MVA #1 and to providing
a list of documents and setting dates for mediation, discovery and trial. In
addition, there were periods in which there was no activity at all. The
numerous letters from ICBC’s adjusters and counsel, which expressed increasing
frustration with the lack of action on the file, were not copied to Ms.
McKeachie and do not appear to have been responded to by Mr. Perrick. Mr.
Perrick took very few steps which could be classified as advancing Ms.
McKeachie’s claims.

[70]        
Third, although Mr. Perrick says that he advised Ms. McKeachie in 2006 that
he had received a formal offer to settle her claims arising MVA #1, there is no
letter to her to that effect; he did not meet with her to discuss the
settlement offer, either in person or by telephone; and his bill, which appears
to be in chronological order, does not reflect either a phone call or a letter
to her at that time.

[71]        
Fourth, when Mr. Perrick recommended that Ms. McKeachie accept ICBC’s
$25,000 settlement offer for MVA #1, there were outstanding applications to
dismiss both of Ms. McKeachie’s actions. Mr. Perrick says he advised Ms.
McKeachie of the applications but was not concerned about them because “they
never succeed”. While Mr. Perrick discounted the risk of success of those
applications, the fact that they were outstanding was significant and Ms.
McKeachie was entitled to a full understanding of how they had come about and
to reach her own conclusion with respect to whether her actions were at risk. This
might include obtaining independent legal advice. Mr. Perrick did not send Ms.
McKeachie to obtain independent legal advice before she accepted ICBC’s offer.

[72]        
Fifth, when he recommended acceptance of the settlement offer, he did
not have Ms. McKeachie’s medical records from her family practitioner or any of
the various therapists who treated her. The only medical records that he had
were ICBC’s defence medical report from Dr. Tessler indicating that he thought
Ms. McKeachie’s lower back difficulties would resolve but they had not done so
more than two years after the accident. Five years later, Ms. McKeachie was
reporting that she was still experiencing back pain but Mr. Perrick did not
obtain current medical information.

[73]        
In fact, Mr. Perrick did not obtain Ms. McKeachie’s family doctor’s
reports until after the settlement. He therefore had no up to date medical
information on which to assess the value of her claim. Indeed, he had no more
medical information than had been available to him when ICBC first made its
offer in 2005. Further, while he had received and reviewed her income tax records
with respect to her wage loss between 1998 and 2003, there was no new
information here either and there is no explanation as to why that could not
have been done in 2006 when he first received ICBC’s offer. Finally, while he
had one hand written note from Ms. McKeachie about her out of pocket expenses
and wage loss claim, he did not confirm that he had up to date information in
that regard.

[74]        
Sixth, a review of the account indicates that Mr. Perrick billed for
numerous telephone discussions and correspondence with ICBC’s adjusters and lawyers
over time. A review of that correspondence indicates that ICBC believed that
Mr. Perrick was not being responsive to it. On the evidence before me, the only
correspondence on the file for most of the solicitor/client relationship is incoming
correspondence from various individuals on behalf of ICBC attempting to move
Ms. McKeachie’s actions forward. A fair reading of the correspondence indicates
that Mr. Perrick was merely reacting to steps taken by ICBC and not proactively
advancing Ms. McKeachie’s claims. Mr. Perrick’s file records are surprisingly
sparse for a retainer that lasted more than seven years.

[75]        
Seventh, the account refers to the following matters:

…

Receiving Notices of Motion and
supporting Affidavits in both actions for orders to deliver List[s] of
Documents and Particulars;

Preparing and filing Responses and
Affidavits in opposition to claims set out in the said motions;

Receiving Notices of Hearing on
September 11, 2009 setting matters down for hearing in Supreme Court on
September 17, 2009;

…

Preparing for and attending on
Motions at Supreme Court on September 17, 2009;

…

Receiving, reviewing and amending proposed form of Master Taylor’s
Order made September 17, 2009.

[76]        
I conclude based on the evidence, both documentary and oral, that none
of that work would have been necessary had Mr. Perrick proactively pursued Ms.
McKeachie’s claims and responded in a timely way to the numerous requests from
ICBC to move the actions forward. In the circumstances, I conclude that this
was work was not necessary and appropriate. Rather, it was work necessitated by
Mr. Perrick’s lack of attention to Ms. McKeachie’s claims. Ms. McKeachie should
not be required to pay for it.

[77]        
In assessing the work that was necessary and proper, I accept that time
spent in preparing and serving the writs and statements of claim falls in this
category as does receiving and reviewing appearances and statements of defence filed
on behalf of the defendants by ICBC. Apart from that work, I see very little
work in this file which was undertaken to advance Ms. McKeachie’s interests.

[78]        
Turning now to the specific factors in s. 71(4) of the LPA.

[79]        
Ms. McKeachie’s legal claims were not novel, complex or difficult and
did not require any particular skill or specialized knowledge from Mr. Perrick.
Liability for both accidents and been admitted, the only issue was the quantum
of Ms. McKeachie’s pecuniary and non-pecuniary losses. The amounts involved
were not significant although the matters were of significance to Ms.
McKeachie.

[80]        
There was no agreement between Mr. Perrick and Ms. McKeachie as to an
hourly rate. If there had been, I suspect it would have been at a rate higher
than the effective rate in this account.

[81]        
Ms. McKeachie took no issue with Mr. Perrick’s character and standing in
the legal profession.

[82]        
That leaves for consideration the result obtained. Counsel for Ms. McKeachie
urged me to find that Mr. Perrick’s actions have prejudiced her claims with
respect to MVA #2 and opened up the possibility that ICBC will argue that any
future loss of income arose from MVA #1 which has been settled. Counsel also
urged me to find that Mr. Perrick gave Ms. McKeachie incorrect advice. I have
concluded that those arguments are more appropriately considered in the
negligence action.

[83]        
For assessment purposes, it is sufficient for me to conclude that the
result that was achieved in June 2011, when Ms. McKeachie finally received the
ICBC settlement funds, was one that could have been achieved in April 2006 when
ICBC first made its offer. No information came to light between the date of the
offer, its date of acceptance and its date of payment. As a result, Ms. McKeachie
waited five years to recover an amount that was available to her in April 2006
and perhaps earlier if Mr. Perrick had responded to ICBC’s invitation to have
Ms. McKeachie make a settlement proposal.

[84]        
In all of these circumstances, I determine that Mr. Perrick is entitled
to a fee of $500 plus HST and to the undisputed disbursements of $895.19 for a
total amount of $1,455.19. That amount fairly reflects the necessary and proper
steps which, in this case, amounted to little more than issuing two writs and
pro forma statements of claim, to receiving and reviewing appearances and
statements of defence which admitted liability, and to negotiating on behalf of
Ms. McKeachie’s daughter with respect to her liability for her later accident.

[85]        
Because I have reduced Mr. Perrick’s fees by more than one-sixth, Ms. McKeachie
is entitled to her costs of this review under s. 72 of the LPA. If the
parties are unable to agree on Ms. McKeachie’s costs, she may take out an
appointment to have them assessed before any registrar of the court.

[86]        
Further, as this decision results in a refund of fees already paid by
Ms. McKeachie, she is entitled to pre-judgment interest pursuant to s. 73(4) of
the LPA on the difference between the amount I have assessed as owing,
and the amount paid by Ms. McKeachie by deduction from the ICBC settlement,
from the date of that deduction to the date of these reasons.

“Master MacNaughton”