Wednesday, October 15, 2014

Costs awards when represented by a lawyer in the family

I noticed an interesting decision a few weeks back, Watkins v. Toronto Terminals Railway, involving a motion in an ongoing wrongful dismissal case where the plaintiff is represented by her husband.  The costs decision was just released, which has some interesting discussion.


The case is a wrongful dismissal case, involving allegations that the plaintiff was harassed.  She's being represented by her husband, Ryan Watkins.

Firstly, I should highlight that, unlike doctors, we lawyers aren't prohibited from rendering professional assistance to family members.  There are professionalism 'red flags' raised by such things in some contexts, but it's something that's not inherently improper.  In a wrongful dismissal context, for a lawyer to represent a spouse can certainly make sense.

However, there's another concern in such a context:  It isn't at all uncommon for a spouse to be a part of workplace interactions, particularly workplace social events, and there is a pretty strict prohibition on lawyers acting as witnesses.  That's how the motion in issue comes up:  The defendant alleged that Mr. Watkins is a potential witness, in part because he attended at least one social event with his wife and the alleged harasser.  Master Muir rejected this argument, however, on the basis that there are no controversial facts arising from that social event, and no "significant likelihood" of Mr. Watkins being called as a witness.

That seems a fair assessment.  It's likely that the defendant made the motion as a tactical matter:  If they could have Mr. Watkins removed from the case, Ms. Watkins would have to start incurring legal fees, and this would lead to pressure to settle.

But the costs decision is far more interesting.


Mr. Watkins does not appear to be charging his wife for work on the file.  This complicates a costs decision, as the primary purpose of a costs award is 'indemnity' - i.e. to compensate a party for the costs being incurred.

However, there are other purposes to costs awards - to deter frivolous litigation, and to discourage unnecessary steps that prolong litigation.

There's a growing body of 'pro bono' case law where a costs award is made even where the client isn't getting charged.  Presumably, this money will go to the lawyer, compensating him or her directly for the time incurred.

Watkins argued that this falls into the same framework.  Master Muir disagreed to some extent:  "the lawyer for the plaintiff is not handling this matter as part of the profession's commitment to ensuring access to justice.  It would appear that he is handling this matter in order to reduce his spouse's legal expenses."

That being said, it remains true that the opposing party should still have to consider, when evaluating what steps to take in the litigation, the risk of having to contribute to the plaintiff's costs if they're unsuccessful.  Therefore, the plaintiff was awarded costs of 25% of what she was seeking - $2,774.10 instead of $11,096.39.


I'm not sure how I feel about this.  I do agree that some costs are warranted, but I'm not sure about the arbitrary reduction.

It does bear noting that self-represented litigants, even lawyers, have a hard time obtaining costs awards at all.  The system does not particularly value the time and energy that self-represented litigants have to spend preparing their own case.

But Mr. Watkins is not the litigant.  He is a professional, rendering professional services for which he is licensed, to a client.  Unlike a self-represented litigant (for whom a license to practice is strictly irrelevant), his assistance to his client in this context requires a licence.  True that he is not charging that client, but I'm not sure I see a basis for devaluing his time on that basis:  The defendant forced him to incur dozens of hours of time to respond to this motion; the internal retainer arrangement between himself and his client would seem to be immaterial to the reasonable amount of costs that the defendant should have to bear for that.  Certainly, as a busy lawyer, he could be turning that time around into billable hours that would line his own pocket (or, rather, his firm's pocket, such that he would be in a better position to negotiate raises and bonuses).


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation. If you need legal assistance, please contact him for information on available services and billing.

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