



CITATION: Cookish v. Paul Lee Associates Professional
    Corporation,

2013 ONCA 278

DATE: 20130430

DOCKET: C55638

Doherty, Laskin and
    Blair JJ.A.

BETWEEN

Kathleen Cookish

Applicant (Respondent)

and

Paul Lee Associates
    Professional Corporation

Respondent (Appellant)

Tanya A. Pagliaroli, for the
    appellant

David S. Wilson, for the
    respondent

Heard: January 14, 2013

On appeal from the order of
    Justice Kevin W. Whitaker of the Superior Court of Justice dated May 25, 2012,
    with reasons reported at 2012 ONSC 3084.

R.A. Blair J.A.:

Overview

[1]

Paul Lee Associates Professional Corporation delivered an account to Ms.
    Cookish for services rendered under what it says is a contingency fee
    agreement.  Ms. Cookish contested the account, and obtained an order from
    Corrick J. on consent referring it to the assessment officer in Toronto for
    assessment.

[2]

As it turns out, however, there is a dispute about the nature of the
    retainer agreement entered into between the parties.  Is it, or is it not, a
    valid contingency fee agreement, as contemplated by the
Solicitors Act
,
    R.S.O 1990, c. S.15 (the Act)?  If the answer is no  as Ms. Cookish contends 
    then the account may be assessed as to amount on a
quantum meruit
basis.  If the answer is yes  as the solicitors contend  then effect must be
    given to the formula set out in the agreement in determining the amount.

[3]

On this appeal, the issue is whether the assessment officer can, or
    should, determine such a dispute.  More precisely, the issue is whether an
    assessment officer has, or may be given, the jurisdiction to assess a
    solicitors account where there is an underlying dispute between the solicitor
    and the client about the nature and validity of the retainer agreement.

[4]

An assessment officer has no inherent jurisdiction.  For the reasons
    that follow, I conclude that, while there may be circumstances in which it is
    appropriate for a judge, when referring a solicitors bill for assessment, to
    delegate such decisions to an assessment officer pursuant to the reference
    powers under Rule 54 of the
Rules of Civil Procedure
, R.R.O. 1990,
    Reg. 194, the preferable procedure is for a judge to make those determinations.

[5]

For that reason, and also because it appears that the order of Corrick
    J. referring the appellants bill for assessment was made and consented to on
    the premise that only the quantum of the bill was in dispute, I am satisfied
    that her order should have been set aside, and that Whitaker J. erred in
    declining to do so.  I would therefore allow the appeal, set aside the orders
    below, and remit the matter to the Superior Court of Justice for
    reconsideration.

Factual Background

[6]

Ms. Cookish retained the appellant solicitors to represent her in
    pursuing a claim against her insurer arising out of the denial of long term
    disability (LTD) benefits.  She signed what the solicitors refer to as their
    standard contingency fee retainer agreement for LTD claims.

[7]

On March 3, 2009, the claim for LTD benefits was settled at mediation
    for the sum of $285,000 plus $44,000 on account of costs and disbursements. 
    Ms. Cookish signed a full and final release reflecting the terms of the
    settlement and, after the retainer amount was deducted from the award, received
    a net recovery of $237,120.

[8]

Almost a year later, on February 3, 2010, she advised the solicitors
    through another lawyer that she intended to seek an assessment of their
    account.  The application was not launched until August 30, 2010, however.
[1]
In the Notice of Application, Ms. Cookish stated: [t]he client disputes the
    amount of the account and wishes to have the same assessed.  She did not
    contest the validity, enforceability or nature of the retainer agreement as a
    contingency fee agreement.

[9]

The appellant contends that, on the understanding Ms. Cookish was
    expressly disputing only the amount of the account, it consented to an order
    directing the assessment.  Corrick J. made the order on December 1, 2010.

[10]

Before
    the scheduled assessment was to take place (in November, 2011), the appellant retained
    its present counsel, who raised the argument that the assessment officer did
    not have jurisdiction to deal with the matter because at the heart of the
    dispute was a difference of opinion over the validity of the retainer agreement
    as a valid contingency fee agreement.  The appellant sought to have the matter
    referred back to the Superior Court of Justice, but Ms. Cookish refused to
    agree.  She argued that she was entitled to a
quantum meruit
assessment
    of the account.  In response, the appellant took the position that a
quantum
    meruit
assessment was not applicable because the retainer was a
    contingency fee agreement and further, that since the client was disputing the
    validity of the agreement, the assessment officer did not have jurisdiction to
    decide that issue.

[11]

Faced
    with this dispute, the assessment officer adjourned the hearing.  The appellant
    then applied for an order setting aside the consent order of Corrick J. directing
    the assessment.  Whitaker J. heard the motion and refused to set aside the
    order.

[12]

The
    appellant seeks to set aside both orders.  It does not oppose the assessment of
    the account or the determination of the validity and enforceability of the
    retainer agreement in the proper forum.  The appellant asserts, however, that a
    hearing before an assessment officer is not the proper forum.

Analysis

[13]

In
    summary, the appellant submits:

a)

that an assessment officer has
    no jurisdiction to conduct an assessment where there is a dispute with respect
    to the solicitors retainer or the terms of that retainer;

b)

in any event, that an assessment
    officer has no jurisdiction to assess, examine, enforce or cancel contingency
    fee agreements because the
Solicitors Act
has reserved that power to a
    judge; and

c)

that the motion judge erred in
    failing to find that the interests of justice required the consent order of
    Corrick J. to be set aside.

[14]

In
    determining these issues, it is helpful to keep in mind that where a
    solicitors bill has been rendered, a client may have the bill assessed in a
    number of ways, and in different circumstances.  They all involve an order of
    the court referring the matter to the assessment officer.  In one circumstance
    only, that order may be obtained on requisition to the registrar.  In all other
    cases, the reference is made by a judge.  The various options are:

a)

a requisition
to the registrar within one month following
    delivery of the bill, provided the retainer is not disputed and there are no
    special circumstances: s. 3 of the Act;

b)

an application
to a judge for an order directing the bill for
    assessment,

(i) within 12 months following delivery of the bill: an
    application founded on the inherent jurisdiction of the court;
[2]

(ii)  after 12 months following delivery of the bill: s.
    4(1);
[3]

(iii)  following payment of the bill: s. 11;

(iv) within 12 months following payment: inherent
    jurisdiction of the court; and

(v) where the retainer agreement is a contingency fee
    agreement: s. 28.1(11).

See, generally, Mark M. Orkin,
The Law of Costs,
loose-leaf, 2nd ed. (Aurora: Canada Law Book, 1987), at ch. 3.


[15]

Here,
    the request for an assessment arises either under (b)(ii) above (i.e., by way
    of an application made more than 12 months following delivery of the solicitors
    bill, pursuant to s. 4(1) of the Act), or under (b)(v) (by way of application
    for the assessment of an account rendered under a contingency fee agreement).

a) Does An Assessment Officer Have Jurisdiction to
    Determine a Dispute Concerning A Retainer Agreement in General?

[16]

Ms.
    Pagliaroli submits on behalf of the appellant that an assessment officer does
    not have the authority in any circumstances to deal with disputes concerning
    the retainer, other than disputes regarding quantum alone. In my view, while
    that is true where an order is obtained on requisition under s. 3(1), it is not
    accurate to say that such authority may never be given to an assessment officer. 
    However, the preferable procedure is for a judge to determine these issues. 
    Once they have been resolved, the bill may then be referred to the assessment
    officer for a determination of the proper quantum, if necessary.

[17]

I
    arrive at this conclusion for the following reasons.

[18]

An
    assessment officer has no inherent jurisdiction and must therefore find his or
    her authority in some statutory source or in the
Rules of Civil Procedure
.
     This principle has been applied to masters and, by extension, registrars
    charged with issuing orders for assessment: see
Davies, Ward & Beck v.
    Union Industries Inc.
(2000), 48 O.R. (3d) 794 (C.A.), at para. 13;
Crooks
    v. Clement
, [1997] O.J. No. 5436 (Gen. Div.), at para. 11.  By further
    extension, this principle also applies to assessment officers.

[19]

The
    position of assessment officer is created by s. 90 of the
Courts of Justice
    Act
, R.S.O. 1990. c. C.43, but it is questionable whether that section
    itself provides an assessment officer with authority to assess a solicitors
    bill
vis-à-vis
a client.  While s. 90(3) provides jurisdiction to
    assess costs in a proceeding in any court, that provision more likely provides
    authority for the assessment of costs as between litigants in a proceeding rather
    than for the assessment of a solicitors bill as between the solicitor and the
    client.  In the latter situation, an assessment officers authority is rooted
    either in the
Solicitors Act
or in reference provisions found in Rule
    54 of the
Rules of Civil Procedure
, in my view.

[20]

Subsection
    3(1) of the Act and the jurisprudence relating to it make it clear that an
    assessment officer has no jurisdiction to determine disputes relating to the
    existence, nature, terms or extent of a retainer agreement where the order is
    obtained on
requisition.
There are only two exceptions to this
    proposition: (i) where there is really no legitimate dispute regarding the
    retainer; or (ii) where the dispute relates only to the quantum of the bill: see
Paoletti v. Gibson
, 2009 ONCA 71, 308 D.L.R. (4
th
) 179, at
    paras. 28-30; and
Park v. Perrier
(2005), 200 O.A.C. 377 (Div. Ct.),
    at para. 66.

[21]

While
    an assessment officer is expressly
excluded
from exercising the
    authority to resolve disputes regarding the retainer where the assessment order
    is obtained on requisition under s. 3(1), there is nothing in the Act that
    expressly
grants
an assessment officer the authority to do so in any
    other circumstances.  The route to that authority  to the extent it should be
    exercised  lies in the reference procedure provided in the Rules, in my view.

[22]

Rule
    54.01 applies Rules 54 and 55 to references directed under a statute, subject
    to the provisions of the statute.  I have no doubt the drafters of the
Solicitors
    Act
intended that the reference procedure would provide the mechanism by
    which the assessment of solicitors accounts would proceed.  Apart from s. 3 (where
    the assessment order is obtained on requisition to the registrar), the remaining
    options for a client to attack a solicitors bill (or for a solicitor to seek
    to enforce it), as outlined earlier in these reasons, all involve an
    application to the court for a reference.  Section 6 of the Act makes it clear
    that the reference power is indeed the vehicle by which solicitors accounts
    are to come before the assessment officer: s. 6(4) precludes a solicitor from
    commencing or prosecuting an action for payment pending the reference without
    leave; and s. 6(5) adopts the confirmation procedure from the reference rules
    for finalization of the assessment officers report.

[23]

These
    provisions operate as a sort of gateway between the portions of the Act dealing
    with assessments and the reference proceedings under the Rules.  But it does
    not follow that every issue regarding assessment should pass through that
    gateway.

[24]

Two
    primary considerations lead me to this conclusion.

[25]

First
    is the language of s. 23 of the Act.  Section 23 is the provision that
    addresses the determination of disputes under a retainer agreement (including a
    contingency fee agreement) in general.  Its relevant parts state:

No action shall be brought upon [a retainer] agreement,
but
    every question respecting the validity or effect of it may be examined and
    determined
, and it may be enforced or set aside without action
on the
    application
of any person [who is entitled to apply as set out in the
    section],
by the court
in which the business or any part of it was
    done or a judge thereof, or, if the business was not done in any court, by the
    Superior Court of Justice. [Emphasis added.]

[26]

While
    this language does not explicitly prohibit the court from referring matters
    respecting the validity or effect of a retainer agreement to an assessment
    officer, it clearly signals the legislatures intention that matters of that
    nature are to be determined by the court or a judge thereof.  This does not
    include an assessment officer, for the following reasons.

[27]

The
    term court is not defined in either the
Solicitors Act
or the
Courts
    of Justice Act
.  However, it is defined in the Rules to mean:

[T]he court in which a proceeding is pending and, in the case
    of a proceeding in the Superior Court of Justice, includes,

(a) a master having jurisdiction to
    hear motions under Rule 37, and

(b) a case management master

[4]

[28]

Because
    masters are included in the meaning of court, the Rules and various statutes
    draw a distinction between the court and a judge thereof.  Assessment
    officers are creatures of s. 90 of the
Courts of Justice Act
. They are
    not masters (although all masters are assessment officers: s. 90(2)).  The
Solicitors
    Act
itself provides further confirmation that assessment officers are not
    considered to be included in the word court by drawing a clear distinction
    between the two, for example in ss. 18, 26, 27, and 30.

[29]

All
    of this strongly suggests that when the legislature says in s. 23 of the Act that
    every question respecting the validity or effect of a retainer agreement may
    be examined and determined by the court or a judge thereof, the legislature
    intended that as a general rule, (notwithstanding the reference power) a judge
    or other member of the court will perform that function  not an assessment
    officer.

[30]

This
    is consistent with the nature of a judges power to direct a reference under
    the provisions of rule 54.02.  A review of those provisions reveals that the
    power is somewhat circumscribed.  Absent consent, it may not be exercised in
    every proceeding or with respect to every issue coming before the court.  This
    is the second consideration that leads me to the above conclusion.

[31]

In
    its entirety, rule 54.02 states:

(1)  Subject to any right to have an issue tried by a
    jury, a judge may at any time in a proceeding direct a reference of the whole
    proceeding or a reference to determine an issue where,

(a) all affected parties consent;

(b) a prolonged examination of documents or an investigation
    is required that, in the opinion of the judge, cannot conveniently be made at
    trial; or

(c) a substantial issue in dispute requires the taking of
    accounts.

[32]

Undoubtedly,
    a judge is given broad discretion to refer matters to others for determination
    where the requirements of rule 54.02 are met.  He or she may direct a
    reference
of the whole proceeding
or a reference
to determine any
    issue
 at any time in a proceeding.  This language itself has a limitless
    ring to it.  However, absent the consent of the parties, the circumstances in
    which that broad power may be exercised are not unlimited.  The rule itself puts
    boundaries around its exercise.

[33]

A
    consideration of the parameters of the rule in the context of this appeal
    suggests that the discretion may only be invoked on the basis that a prolonged
    examination of documents or an investigation is required that, in the opinion
    of the judge, cannot conveniently be made at trial or that the proceedings
    involve a contest that calls for the taking of accounts.  Disputes concerning
    the validity or effect of a retainer agreement do not readily fall into those
    categories, although a straight reference for the assessment of the amount
    owing under a solicitors account more readily does.  The other circumstances
    in the rule invoking the judges exercise of discretion (proceedings relating
    to the conduct of a sale, the appointment of guardians, the conduct of
    guardianships or receiverships, or the enforcement of orders) all serve to
    underscore the somewhat limited range of circumstances where, absent consent, a
    judge may direct a reference.

[34]

This,
    too, is consistent with the view that, in general, disputes regarding the
    validity or effect of a retainer agreement should be determined by a judge. 
    Absent the consent of the parties, the judge hearing an application for
    referral of a solicitors bill for assessment should give careful consideration
    to whether it is appropriate to incorporate the resolution of issues regarding
    a disputed retainer in the order for referral being made.

b) Does an Assessment Officer Have Jurisdiction Over
    Contingency Fee Agreements?

[35]

The
    appellant submits, in addition, that contingency fee agreements are treated
    differently, and because the retainer agreement here is that kind of agreement,
    s. 28.1 of the
Solicitors Act
ousts the jurisdiction of an assessment
    officer to construe or enforce it, entirely apart from the foregoing
    considerations. On a review of the Act as a whole, I am not persuaded that the
    ouster is as complete as the appellant argues.  I do not think the fact that
    the agreement in question may be a contingency fee agreement alters the above
    analysis in any material way.  Rather, all of the considerations referred to
    above, together with some additional considerations, lead to a similar
    conclusion.

[36]

Subsection
    28.1(1) authorizes solicitors to enter into contingency fee agreements with
    clients in accordance with this section.  In the section and the regulations
    enacted under it, the legislature sets out the parameters governing such
    agreements: what is permitted and required in terms of their contents; certain
    exceptions where contingency fees are not permitted (criminal proceedings and
    family law matters); maximum percentages; approval procedures for amounts
    exceeding the maximum percentages; enforceability; and assessment of
    contingency fees.

[37]

Subsection
    28.1(11) addresses the assessment of contingency fees:

(11)  For purposes of assessment, if a contingency fee agreement,

(a) is not one to which subsection (6) or (8)
    applies, the client may apply to the Superior Court of Justice for an
    assessment of the solicitors bill within 30 days after its delivery or within
    one year after its payment; or

(b) is one to which subsection (6) or (8) applies,
    the client or the solicitor may apply to the Superior Court of Justice for an
    assessment within the time prescribed by regulation made under this section.
[5]

[38]

The
    appellant argues that s. 28.1(11) confers exclusive jurisdiction on Superior
    Court judges to assess a solicitors bill based on a contingency fee
    agreement.  I do not read s. 28 quite as exclusively, however.  I see no
    material difference between the right to apply to the Superior Court of
    Justice for an assessment under s. 28.1(11) and the right to apply to the
    court or a judge for an assessment in relation to any other retainer agreement. 
    All routes theoretically leave open the potential for a judge to resort to the
    reference procedure under the Rules and to delegate an issue to the assessment
    officer.

[39]

Nonetheless,
    for the same reasons that I have articulated above, I conclude that, as a
    general rule, questions involving the nature, validity or effect of a
    contingency fee agreement should be resolved by judges.  Indeed, there may be
    stronger arguments for such a proposition in the case of contingency fee
    agreements.

[40]

The
    acceptance of contingency fee agreements as a legitimate way for lawyers and
    their clients to structure lawyers remuneration has evolved in recent years. 
    At common law, such agreements were long held to be champertous, and therefore
    unenforceable: see e.g.
Solicitor (Re)
(1907), 14 O.L.R. 464 (H.C.),
    at p. 465;
Robinson v. Cooney
, [1999] O.J. No. 1341 (S.C.); and
Bergel
    & Edson v. Wolf
(2000), 50 O.R. (3d) 777 (S.C.).  Over time, however,
    the courts began to recognize the advantages to the administration of justice,
    in the form of increased access to justice, from properly regulated contingency
    fee agreements:
Raphael Partners v. Lam
(2002), 61 O.R. (3d) 417
    (C.A.), at para. 54;
McIntyre Estate v. Ontario (Attorney General)
(2002), 61 O.R. (3d) 257 (C.A.), at para. 72.

[41]

In
    the result, the
Solicitors
Act
was amended, effective October 1, 2004, to recognize the validity of such
    arrangements when entered into in compliance with the terms of that legislation.
     On October 28, 2004, the Law Society of Upper Canada amended its
Rules of Professional
    Conduct
to govern the conduct of solicitors in relation to contingency fee
    arrangements. Section 28.1 and its related amendments to the Act are the
    progeny of that evolution.

[42]

However,
    contingency fee agreements remain the subject of careful scrutiny by the
    court.  That scrutiny is provided by judges (or masters).  Only the court is
    entitled to determine whether such an agreement is in all respects fair and
    reasonable between the parties (s. 24).  While s. 18 grants an assessment
    officer that power in relation to retainer agreements in general  subject to
    the discretionary ability to refer the issue to the court, if it is in doubt  s.
    28.1(10) stipulates that ss. 17-19 do not apply to contingency fee agreements.
    The authority to determine whether an agreement is fair and reasonable is therefore
    expressly stripped from the assessment officer when it comes to contingency fee
    agreements.

[43]

Contingency
    fee agreements may only be enforced if they are fair and reasonable, as these
    qualities form the heart of their legitimacy.  Only where such an agreement is
    not fair and reasonable may it be declared void or be cancelled or disregarded:
Henricks-Hunter (Litigation Guardian of) v. 814888 Ontario Inc. (c.o.b.
    Phoenix Concert Theatre)
, 2012 ONCA 496, 294 O.A.C. 333, at para. 13.  The
    assessment officer is deprived of the authority to make that call by the terms
    of s. 28.1(10).

[44]

Given
    this lack of authority regarding the essential characteristics that make a
    contingency fee agreement enforceable or unenforceable, there would be little
    point in delegating to an assessment officer, by means of the reference power,
    the authority to determine disputes involving the nature of the agreement
    itself or the scope of its terms (except to the extent they may relate to
    quantum alone), as these disputes would most often go to issues of
    reasonableness and fairness in any event.

[45]

Presumably,
    the appellants contention that s. 28.1 ousts the jurisdiction of the assessment
    officer would go so far as to suggest that none of the other avenues for
    contesting (or enforcing) a solicitors bill are available when it comes to the
    assessment of a bill rendered pursuant to a contingency fee agreement.  This
    would theoretically include the requisition procedure where the retainer is not
    in dispute, or resort to the courts inherent jurisdiction where the assessment
    is sought within a year after the bill is delivered, or resort to s. 4 (where
    the assessment is sought more than 12 months after the bill is rendered), or resort
    to s. 11 (where the assessment is sought after the bill has been paid).

[46]

It
    is not necessary for purposes of this appeal to resolve that particular
    contention.  I observe, however, that there would appear to be some force in
    it.  Subsection 28.1(11) appears to embrace all contingency fee agreements
    (those to which subsection (6) and (8) apply and those to which they do not). That
    being the case, it would make sense that access to other general assessment
    provisions of the Act would not be available for bills rendered under a
    contingency fee agreement.

[47]

This
    does not alter the proper disposition of this case, however.  If the
    appellants bill has been rendered pursuant to a contingency fee agreement, s.
    28.1(11) applies; if not, s. 4(1) does. The ultimate conclusion is unaffected:
    the court or the judges thereof should generally resolve any issue other than
    the amount owing under the agreement. Having regard both to the careful
    scrutiny to which the courts subject contingency fee agreements, and to the
    more limited role that assessment officers are afforded with respect to such
    agreements,  this view may be even more forceful when it comes to the
    assessment and enforcement of amounts owing under such agreements.

c) Should the Consent Order of Corrick J. Have Been
    Set Aside?

[48]

I
    turn, then, to the failure of the motion judge to set aside the consent order
    of Corrick J.  Was it an error not to do so?

[49]

There
    is a real question, in my view, as to whether the order of Corrick J. should
    have, or was intended to clothe the assessment officer with the jurisdiction to
    determine the dispute regarding the validity, nature and extent of the appellants
    retainer.  I am satisfied she did not intend it to do so.

[50]

The
    materials upon which the order was based raised only the issue of the quantum
    of the bill.  Indeed, the respondent does not contest this or suggest that she
    was raising a dispute regarding the enforceability, validity or the terms of
    the retainer on the application.  Arguably, the solicitors provided their
    consent to the order on the basis of the materials supporting the application
    (notwithstanding the several exchanges of correspondence between counsel, each
    setting out their own view as to the nature of the retainer).

[51]

Given
    the preference signalled by the legislature that these matters are to be
    determined by judges, I think it unwise to assume that an order providing
    simply that the solicitors bill be referred to the Assessment Officer at
    Toronto for assessment  as Corrick J.s order did  is sufficient as a matter
    of law to vest in the assessment officer the jurisdiction to determine disputes
    regarding the retainer itself.  The language used in the order is the language
    of quantum. Moreover, such an assumption would work against the grain of all of
    the jurisprudence suggesting that an assessment officer only has that type of
    jurisdiction where it is specifically provided.

[52]

In
    this respect, the jurisprudence under s. 3 of the
Solicitors Act
is
    instructive.  The courts have been assiduous in declaring that assessment
    officers do not have authority to address genuine disagreements regarding the
    solicitors retainer (except for quantum) when assessing a bill pursuant to an
    order obtained on requisition.  It is a prerequisite of s. 3 that the retainer
    not be in dispute, and if it turns out to be the case that it is in dispute,
    the order obtained on requisition must be set aside: see
Paoletti v. Gibson
;
Park v. Perrier;

Re Solicitor
(1964), 49 D.L.R. (2d) 505
    (Ont. H.C.);
Roach, Schwartz & Associates v. Pinnock
, 2004 CanLII
    18719 (Ont. S.C.);
Penonzek v. Cerra
, 2001 ABQB 272, 287 A.R. 57, at
    paras. 15-17; and
Solicitor (Re)
, [1940] 4 D.L.R. 712 (Ont. H.C.),
    affd without reasons [1940] 4 D.L.R. 821 (Ont. C.A.).  Apart from the clear
    wording to that effect in the section, the rationale for this approach was
    explained by Rose C.J.H.C. in the latter case, at para. 7:

On the contrary, since the statute gives power to the
    registrars to issue the orders on praecipe only in cases in which the retainer
    is not disputed and there are no special circumstances,
the Court ought to
    see to it that no advantage can be gained by applying on praecipe in a case in
    which the condition precedent to the exercise of the registrars authority to
    issue the order does not exist
.  In other words, persons taking these
    orders on praecipe ought to be held to do so at the risk of having them set
    aside if it turns out that there is in fact a dispute as to the retainer or any
    special circumstance.
[6]
[Emphasis added.]

[53]

This
    rationale suggests that courts have been careful to ensure that assessment
    officers do not deal with retainer disputes (except quantum) unless they are
    specifically authorized to do so and that courts and judges should instead have
    that responsibility.  As Rouleau J.A. noted in
Paoletti
, at para. 27,
    once it appears that the retainer is disputed, the assessment officer cannot
    proceed with the assessment and the matter must proceed before a judge by way
    of an action or application.  It makes no sense for the courts to be concerned
    about clients or solicitors jumping the queue  gaining an advantage while
    applying by requisition  if a simple order directing that the accounts be
    referred to the assessment officer  for assessment were enough to accomplish
    the same thing, without a judge applying his or her mind to whether the
    retainer dispute should be resolved by the court (the preferred default
    position on my analysis) or by the assessment officer.

[54]

For
    these reasons I am satisfied that, unless there is something specific in the
    order or the reasons of the judge referring the bill for assessment indicating
    that more is to be decided than simply the quantum to be approved, an order simply
    referring a solicitors bill for assessment should not be interpreted as
    conveying to the assessment officer the authority to resolve questions
    surrounding the disputed retainer.  There is nothing in either the reasons of
    Corrick J. (which dealt only with the question of costs on the application) or
    in her order that would satisfy those conditions  not a surprising turn of
    events since, as noted above, the entire application was presented to her on
    the basis that only the quantum of the bill was being contested.

[55]

In
    my respectful view, the motion judge, who was asked to set aside Corrick J.s
    consent order, erred in failing to recognize the foregoing factors and in
    failing to recognize that the heart of the dispute between the appellant and
    the solicitors revolved around the nature, validity and terms of the retainer
    agreement  an issue that had to be determined before quantum could be
    settled.  It was an error to conclude that [t]he Assessment Officer need only
    determine the quantum.

[56]

Whether
    the consent order should be set aside must be considered in that light.  Courts
    are cautious about setting aside consent orders, of course, but will where it
    is necessary in the interests of justice to do so: see
Stoughton Trailers
    Canada Corp. v. James Expedite Transport Inc.,
2008 ONCA 817, adopting the
    principles set out in
Beetown Honey Products Inc. (Re)
(2003), 67 O.R.
    (3d) 511 (S.C.), affd without comment on this issue, 3 C.B.R. (5th) 204 (Ont. C.A.).

[57]

The
    interests of justice require that the order of Corrick J. be set aside, in my
    opinion.  But for the motion judges error in failing to give effect to the
    jurisprudential preference for judicial determination of disputes regarding the
    nature, validity and effect of a retainer agreement  absent a clear direction
    to the contrary  and but for his error in concluding that the only issue to be
    determined by the assessment officer here was quantum, the motion judge may
    well have come to a different conclusion.  Justice Corrick did not know that
    the retainer was in dispute and she might well have made a different order 
    or, at least, may have been more specific in her direction  if she had.

[58]

In
    those circumstances, I conclude that the order of Corrick J. should have been
    set aside, and that the motion judge erred in failing to so order.

Disposition

[59]

For
    all of the foregoing reasons, I would allow the appeal, set aside the orders of
    the motion judge and of Corrick J., and remit the matter to a judge of the
    Superior Court of Justice to hear the application for an assessment.

[60]

On
    that application, the judge will have to determine whether he or she will
    resolve the dispute between the parties over the nature, validity and effect of
    the retainer agreement entered into between the appellant and the respondent,
    or whether this is one of those rare cases where it may be appropriate to refer
    that dispute to the assessment officer as part of the assessment process
    pursuant to the reference powers found in rule 54.02.

[61]

The
    appellant is entitled to its costs of the appeal. I do not think there should
    be any costs of the motion before Whitaker J. in the circumstances.

[62]

If
    the parties cannot agree on the costs of this appeal, they may make brief
    written submissions, not to exceed six pages, in that regard.  The appellants
    submissions shall be filed within 30 days of the date of this order, and the
    respondents within 15 days thereafter.

[63]

It
    follows from the setting aside of the order of Corrick J. that the costs order
    made by her against the appellant must also be set aside.

[64]

In
    addition, the appellant asks for costs thrown away in relation to the aborted
    assessment hearing.  I would not make such an order at this stage.  I prefer to
    leave that issue to the judge or assessment officer ultimately disposing of the
    assessment.

R.A. Blair J.A.

I agree D. Doherty
    J.A.

I agree John Laskin
    J.A.

Released: April 30, 2013





[1]
The application was necessary because the appellant was out of time for seeking
    an assessment as of right under the
Solicitors Act
.



[2]
As the Court noted in
Fellowes, McNeil v. Kansa Canadian Management Services
    Inc.
(1997), 34 O.R. (3d) 301 (C.A.), at para. 6:

The
Solicitors
    Act
also does not provide for the referral to assessment of unpaid accounts
    rendered between one and twelve months prior to the application.  However, here
    too, the court has an inherent jurisdiction.  In the usual circumstances,
    little is required for that jurisdiction to be exercised.



[3]
This Court has said that the 2-year limitation in the
Limitations Act
,
    S.O. 2002, c. 24, Sch. B (in force and effect January 1, 2004) trumps the
    12-month provision in s. 4(1) of the
Solicitors Act
: see
Echo Energy
    Canada Inc. v. Lenczner Slaght Royce Smith Griffin LLP
, 2010 ONCA 709, 325
    D.L.R. (4
th
) 518, at para. 49; and
Guillemette v. Doucet
, 2007
    ONCA 743, 287 D.L.R. (4
th
) 522, at para. 33.  Whether the 12-month
    periods referred to above are to be read as 12 months or as 24 months is
    not relevant to the issues arising on this appeal.  I will refer to the
    12-month terminology in the statute.



[4]
Rule 1.03(1).



[5]
The time prescribed by the regulation is within six months after [the bills]
    delivery: O. Reg. 195/04, s. 10.  Subsections (6) and (8) are not relevant to
    the issues on this appeal.  Subsection (6) requires early court approval of a
    contingency fee agreement that provides for an amount to be paid in excess of
    the maximum percentage provided by regulation.  Subsection (8) provides that,
    save in exceptional situations and as approved by the court, a contingency fee
    agreement shall not include in the fee payable to the solicitor, in addition to
    the fee payable under the agreement, any amount recovered by way of costs in
    the proceeding.



[6]
Assessment officers are the present-day equivalent of registrars in this sense,
    and the modern substitution for the word praecipe is requisition.


