Monday, 10 October 2011

Costs Against Counsel: A Problem of Privilege

A lawyer's duty to provide "zealous representation" is circumscribed by professional and ethical obligations.  A failure to achieve a balance between the two may result in disciplinary proceedings or an award of costs against lawyer personally under R. 14-1(33).

One situation where a court may award costs against a lawyer personally is where the lawyer goes off "on a frolic of his own" and effectively "highjacks" the client's action.  The threshold for success on such an application is particularly high because, in most cases, it will be difficult to prove this without breaching solicitor client privilege, which the courts are loath to do.  Indeed, this was the case in Jampolsky v. Shattler, 2010 BCSC 408, a decision of Justice Greyell.  In that case, although Justice Greyell expressed a severe disapproval of the plaintiff's lawyer's actions in bringing contempt proceedings against defence counsel (which proceedings he found to be an abuse of process), he also found that he simply could not conclude that in doing so the lawyer went off on a frolic of his own without intruding on solicitor client privilege, which he refused to do.  He ordered special costs against the client, but not the lawyer personally.

Emboldened by his success, the lawyer brought an application for special costs, arguing that the application for costs against him personally was brought recklessly and without an evidentiary foundation.
 In recently released additional reasons (2011 BCSC 1327), Justice Greyell denied the lawyer's application and demonstrated that, even when the evidentiary threshold of awarding costs against a lawyer personally is not met, the court has other ways rebuke counsel for his or her behaviour:
[35] One of the bases for awarding costs against a non-party is that such party has engaged in conduct which constitutes an abuse of the court’s process (International, at para. 54). In my Reasons for Judgment for the contempt respondents’ application for special costs, I stated that it was my view that the contempt application was an abuse of court’s process (see 2010 BCSC 408 at para. 19).
[36] Admittedly, the contempt respondents would not have had the benefit of my Reasons at the time they proceeded with the special costs application. However, my conclusion that Mr. Harding’s actions were an abuse of process indicates that there was evidence prior to the application on which the contempt respondents could base a belief that they might be successful against Mr. Harding, even though he was not a party to the action.
[37] In short, the motion brought by Mr. Harding on behalf of his clients was an abuse of the court’s processes, heavy handed and disreputable. In my view, such conduct needs to be deterred. This is a case that warrants the use of my judicial discretion to deny Mr. Harding’s application for special costs and costs, despite him being the successful party.
In short, don't do it.  Don't go off on a frolic of your own with your client's action.  Don't bring applications abuse the court's process (may be easier said than done).  And, most importantly, if the court found that you likely have done the above, and you escaped R. 14-1(33) costs by the skin of your teeth, do not ask for costs against the applicants.