Citation: 2012 TCC 53
Date: 20120220
Docket: 2009-3634(IT)G
BETWEEN:
JACQUES POISSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR ORDER
D’Auray J.
[1]
In this case, I issued
an order dated November 16, 2011, allowing the motion by counsel for the
respondent to dismiss the appeal.
[2]
Neither the appellant
nor his counsel appeared for the hearing of the motion to dismiss the appeal.
[3]
At the hearing, counsel
for the respondent requested that I order costs in excess of the Tariff under section
147 of the Tax Court of Canada Rules (General Procedure) (Rules).
[4]
Counsel for the
respondent also argued that section 152 of the Rules allows this Court to
direct a counsel to reimburse the counsel’s client for any costs that the
client has been ordered to pay to any other party, where a counsel for a party
has caused costs to be incurred improperly or without reasonable cause or to be
wasted by undue delay, misconduct or other default.
[5]
Subsection 152(2) of
the Rules provides that no such direction shall be made unless the counsel is
given a reasonable opportunity to make representations to the Court.
[6]
I therefore asked
counsel for the appellant and counsel for the respondent for written submissions
on costs and particularly on the application of subsection 152(2) of the Rules.
[7]
Written submissions
were filed by both parties.
[8]
Counsel for the
appellant submits that the costs in this case should be limited to Schedule II,
Tariff B, under Class A, that is, $350 for the preparation of a motion for
dismissal of the appeal. According to counsel for the appellant, the amount of
$2,000 sought by counsel for the respondent is much too high, having
regard to the work done in this case.
[9]
In addition, he submits
that he cannot be held liable for costs in this case because his client, Mr.
Poisson, did not provide him with any instructions; therefore, he could not
inform counsel for the respondent of his client’s intentions.
[10]
The submissions of counsel
for the appellant also indicate that his client withdrew his mandate as soon as
the time for appealing the decision of the Court of Québec expired, that is, on
August 15, 2011.
[11]
The day before the
hearing, November 3, 2011, the law firm of counsel for the appellant sent a letter
to counsel for the respondent indicating to him that he had no mandate from the
client to oppose the motion to dismiss the appeal. This Court did not receive a
copy of this correspondence.
[12]
Counsel for the
appellant did not attend at the hearing on November 4, 2011, as he believed that
his presence was unnecessary.
[13]
However, the motion to
dismiss the appeal was duly served upon him. Furthermore, counsel for the
appellant was still the counsel of record under sections 31 to 34 of the Rules.
[14]
An analysis of the
facts in this case shows that it was on the application of counsel for the
appellant that the case in this Court was held in abeyance. Counsel for the
appellant made a commitment to this Court that the present case would be linked
to the judgment rendered by the Court of Québec. The judgment of the Court of
Québec was rendered on July 15, 2011, and it dismissed the
originating motion of Mr. Poisson. Neither this Court nor counsel
for the respondent was notified that a judgment had been rendered. Counsel for
the respondent found out about it from counsel for the Deputy Minister of Revenue
of Quebec on July 25, 2011.
[15]
On July, 25, 2011, counsel
for the respondent attempted unsuccessfully to communicate with counsel for the
appellant.
[16]
On July 28, 2011, counsel
for the respondent sent a letter to counsel for the appellant asking him to inform
him of his intentions with regard to pursuing the case.
[17]
On August 25, 2011, after
several attempts at communicating with counsel for the appellant, counsel for
the respondent served a second letter, asking him again about his intentions
with regard to pursuing the case. In this letter, counsel for the respondent indicated
that the appellant had until September 2, 2011, to discontinue the appeal
without incurring liability for costs, otherwise a motion to dismiss the appeal
would be filed.
[18]
On September 6, 2011, counsel
for the respondent served a motion to dismiss the appeal on counsel for the
appellant.
[19]
On September 7, 2011, the
respondent’s motion to dismiss the appeal and the proofs of service were filed
with this Court.
[20]
The hearing of the
motion was set down for November 4, 2011, before this Court in Sherbrooke.
[21]
In addition, by letter dated
November 3, 2011, counsel for the respondent confirmed to counsel for the
appellant his attendance at the hearing. See Exhibit I‑1.
[22]
This is a Class A
proceeding because the amount of tax in dispute for each of the 2003 and 2004
taxation years is less than $50,000. Tariff B of Schedule II provides that
costs awarded for the preparation and filing of a motion in a Class A proceeding
are $350.
[23]
Counsel for the
respondent argues that this amount is insufficient considering that the case
had to continue to be managed and that all the necessary steps for obtaining the
dismissal of the appeal were taken because of counsel’s failure to honour his undertakings
to this Court and the respondent.
[24]
Counsel for the
respondent relies on paragraphs 147(3)(a), 147(3)(e), 147(3)(g)
and subparagraph 147(3)(i)(i) of the Rules.
147(3)(a) - the result of the proceeding
[25]
The motion to dismiss
the appeal was allowed. According to counsel for the respondent, no justification
was provided by counsel for the appellant for the conduct he was accused of.
147(3)(e) – the volume of work
[26]
Counsel for the
respondent was forced to spend time on attempting to reach counsel for the
appellant by telephone and by mail and on the preparation of the motion.
147(3)(g) - the conduct of any party that tended to lengthen
unnecessarily the duration of the proceeding
[27]
The respondent argues
that the conduct of counsel for the appellant had the effect of lengthening
unnecessarily the duration of the proceeding.
147(3)(i)(i) - whether any stage in the proceedings was
improper, vexatious, or unnecessary
[28]
The respondent argues
that pursuant to the agreement of counsel for the appellant to link this appeal
to the judgment rendered in the Court of Québec, counsel for the appellant
should have discontinued the appeal in a timely fashion, which would have saved
unnecessary costs for both the Court and the respondent.
[29]
Two issues arise in the
present case:
−
Whether costs in excess
of the Tariff should be awarded.
− Whether counsel for the appellant must be
held liable for costs.
Whether costs in excess of the Tariff should be
awarded
[30]
Most of the decisions dealing
with costs indicate that absent special circumstances or, as stated by Justice
Mainville of the Federal Court of Appeal, where the
circumstances so warrant,
costs awarded should be in accordance with the Tariff.
[31]
In the present case, the
respondent argues that she was successful on the motion to dismiss the appeal
and that, in view of the conduct of counsel for the appellant, she had to
continue to manage the case and had to prepare a motion to dismiss the appeal. The
conduct of counsel for the appellant lengthened unnecessarily the duration of
the proceeding when both the procedures relating to the motion and the hearing
of that motion could have been avoided.
[32]
I agree with the submissions
of counsel for the respondent. Counsel for the appellant made the commitment to
link this appeal to the judgment of the Court of Québec. Accordingly, as soon
as the time for appealing expired, counsel for the appellant should have filed a
discontinuance. Furthermore, counsel for the appellant had been aware since the
end of August 2011 that his client did not wish to continue. He chose to ignore
the telephone calls and correspondence of his colleague. He also chose not to file
a notice of withdrawal as counsel and to ignore the Court by failing to advise
it of his intentions and by not appearing at the hearing.
[33]
In addition, it was not
until the day before the hearing that his firm advised counsel for the
respondent that his client had not given him a mandate to oppose the motion to
dismiss the appeal, but it did not indicate that he would not be appearing
before this Court for the hearing of November 4, 2011. The letter was sent
to counsel for the respondent, and not to this Court, when counsel for the
respondent was already on his way to Sherbrooke.
[34]
I find that in light of
the facts of the case, there are circumstances that justify awarding costs in
excess of the Tariff. It is clear that if counsel for the appellant had notified
his colleague and the Court of his intentions, counsel for the respondent would
not have had to manage the case, prepare a motion and appear before this Court.
A hearing would not have been necessary. The mandate of counsel for the
appellant was withdrawn by his client when the time for appealing expired, that
is, on August 15, 2011. He had ample time to notify the Court and his colleague
of this prior to the hearing of November 4, 2011. A brief telephone call to his
colleague and this Court to inform them that his client did not wish to pursue his
appeal would have sufficed. A discontinuance or a motion to withdraw as counsel
could have been filed.
[35]
Counsel for the
respondent is seeking $2,000 in costs. He did not, however, indicate on
what basis he came to that figure. I find the amount of $2,000 high. In
light of the facts of the case and paragraphs 147(3)(a), 147(3)(e),
147(3)(g), subparagraph 147(3)(i)(i) and subsection 147(4) of the
Rules, I order costs in the amount of $650 plus disbursements.
Whether counsel for the appellant must be held liable
for costs
[36]
Counsel for the
appellant maintains that he was shocked to learn that his client was
withdrawing his mandate because he was to file for bankruptcy the following day.
According to him, he cannot be held liable for his client’s laxity.
[37]
Counsel for the
appellant does not, however, explain in his written submissions why
−
he did not inform his colleague
and the Court that his client had decided not to pursue his appeal at the end
of August 2011, when the time for filing an appeal with the Quebec Court of Appeal
had expired;
−
he did not file a discontinuance
or a motion to withdraw as counsel although he had made a commitment to link
this appeal to the judgment rendered by the Court of Québec;
−
he never contacted counsel
for the respondent, despite telephone calls and correspondence from him
concerning the pursuit of the matter;
−
he did not advise this Court
that he would not be attending at the hearing although he was still the counsel
of record.
[38]
The written submissions
and conduct of counsel for the appellant in this case are most disappointing. It
is clear that if counsel for the appellant had acted diligently and courteously
toward his colleague and the Court, the preparation, the service, the filing
and the hearing of the motion to dismiss the appeal could have been avoided as could
the management of this case by the Court and by counsel for the respondent.
[39]
Section 152 of the Rules
provides as follows:
152. (1) Where
a counsel for a party has caused costs to be incurred improperly or without
reasonable cause or to be wasted by undue delay, misconduct or other default,
the Court may make a direction,
(a) disallowing some or all of the costs as
between the counsel and the client,
(b) directing the
counsel to reimburse the client for any costs that the client has been ordered
to pay to any other party, and
(c) requiring the counsel to indemnify any
other party against costs payable by that party.
(2) A direction under
subsection (1) may be made by the Court on its own initiative or on the motion
of any party to the proceeding, but no such direction shall be made unless the
counsel is given a reasonable opportunity to make representations to the Court.
(3) The
Court may direct that notice of a direction against a counsel under subsection
(1) be given to the client in the manner specified in the direction.
[40]
I adopt Justice Boyle’s
analysis of section 152 of the Rules in Dacosta v. The Queen,
2008 TCC 136, at paragraphs 23 to 28. It is important to state the principle he
sets out at paragraph 23 respecting section 152 of the Rules:
23 The common law inherent jurisdiction requirement that there
be a finding of bad faith clearly does not constitute a prerequisite under Rule
152. The words of Rule 152 should be given their ordinary meaning. There is no
requirement that the lawyer’s conduct be abusive, negligent or in bad faith.
See, for example, the recent Ontario decisions in Walsh v.
1124660 Ontario Ltd. et al., [2007] O.J. No. 639 and Standard Life Assurance Co. v. Elliott et al., [2007] O.J.
No. 2031.
[41]
In this case, I find that the conduct
of counsel for the appellant is caught by section 152 of the Rules. His conduct
has caused costs to be
incurred improperly or without reasonable cause. His conduct reflects a lack of
courtesy towards the Court and counsel for the respondent.
[42]
The Court orders by way of a direction that
the costs awarded to the respondent and payable by the appellant, in the amount
of $650 plus disbursements, be reimbursed in full by counsel for the
appellant under paragraph 152(1)(b) of the Rules, and the Court orders counsel
for the appellant, under subsection 152(3) of the Rules, to provide the
appellant with the Order herein and these Reasons for Order.
Signed at Ottawa, Canada, this 20th day of February 2012.
“Johanne D’Auray”
Translation
certified true
on this 16th day
of September 2014.
Erich Klein, Revisor
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