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BARRISTERS AND SOLICITORS - Compensation - Estimates

Friday, May 10, 2019 @ 8:36 AM  

Lexis Advance® Quicklaw®
Application by the client to extend the time limit to review 15 accounts for fees of $2,850,000 issued by the law firm. The client retained the law firm in 2015 after being sued for oil and gas patent infringement. Their retainer agreement provided legal fees would be based on time incurred on the file. The law firm agreed to apply a 15 per cent discount to its fees. The action against the client was high-profile, highly complex and had significant implications for all parties. The five-week trial occurred in 2017. The law firm issued 23 accounts between 2015 and 2017. The final account was sent in April 2017. The accounts were higher than estimates the law firm had provided the client. The client paid all the accounts. In April 2017, the client changed counsel. In November 2017, the client’s new counsel contacted the law firm advising it had been retained to assess the accounts. In December 2017, the trial judge in the infringement action ruled in the client’s favour.

HELD: Application allowed. The client did not explain its delay in putting the law firm on notice of its concerns regarding the accounts. The fact the litigation against the client was unresolved when it ended the retainer with the law firm did not excuse its delay in raising concerns about the accounts. The law firm would be inconvenienced and prejudiced by a review. The prejudice to the law firm was not inordinate. The significant difference between the law firm’s estimate of fees and its actual accounts weighed in favour of extending the time to review. The law firm’s accounts were neither transparent nor consistent. It was not evident on the face of the accounts that the law firm charged for services on an hourly basis and reduced all fees by 15 per cent to conform to the retainer agreement. The interests of justice would not be served by strictly enforcing the time limit for review.

Blake, Cassels & Graydon LLP v. Baker Hughes Canada Co., [2019] A.J. No. 410, Alberta Court of Queen's Bench, N. Dilts J., April 3, 2019. Digest No. TLD-May62019014