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Special

The basic limitation period is now two years. The limitation period for the assessment of a solicitor’s account is 12 months, subject to extension for special circumstances. What happens when a client attempts to assess a solicitor’s account after two years? Does the court still have to review special circumstances or is the client out-of-luck? Does the Limitations Act, 2002 trump the Solicitors Act? These questions were answered in Guillemette v. Doucet [2007] O.J. No. 4172 (C.A.).

Circumstances

The solicitor rendered several accounts, in the aggregate of $31,000, in a family law matter. The client paid these accounts, but complained about them. The last account was in June 2003 and, shortly after paying it, the client obtained other legal advice and concluded that the accounts were too high. In September 2003, the client was hospitalised for various physical ailments and for the abuse of pain medication. The client brought her application to assess the solicitor’s accounts more than three years later. 

The client claimed that she was not physically or emotionally able to commence the application any earlier. Based on the evidence before him, the motions judge, in the exercise of his discretion, decided that the client had shown special circumstances.

Solicitors Act

Section 4(1) of the Solicitors Act states that an application to assess an account must be made within 12 months from the delivery of the account, unless there are special circumstances. Section 11 of the Act was amended as of January 1, 2004. It now states that the payment of an account does not preclude an assessment, if the special circumstances of the case appear to require the assessment. Before the amendment, there was a necessity, once the account was paid, to bring the application within 12 months and to demonstrate special circumstances. However, the Ontario Court of Appeal had, in prior decisions, interpreted section 11 to ignore the 12-month limitation and just focussed on the special circumstances. Accordingly, the changes to the Act only confirmed in statutory form what the Court of Appeal had already decided.

Limitations

The Limitations Act, 2002 sets out a basic 2-year limitation period. However, it applies only to “claims pursued in court proceedings.” Is an application for leave to assess a solicitor’s account a court proceeding. The Court of Appeal said yes.

The Limitations Act, 2002 also sets out orders of precedence with other statutes. Under section 19, it states, as a general rule, that the limitation periods contained within it trump any other limitation provisions. However, it indicates that any limitation period in a statute referenced in Schedule A to the Act still applies. Accordingly, the next question the Court asked was whether the Solicitors Act is listed in Schedule A to the Limitations Act. The answer was no.

That, however, did not end the enquiry. Section 20 of the Limitations Act, 2002 states that the Act “does not affect the extension, suspension or other variation of a limitation period or other time limit by or under another Act.” The court decided that the “special circumstances” qualifier under the Solicitors Act fell within section 20. Accordingly, although the basic two-year period under the Limitations Act, 2002 governs over the 12-month period in section 4 of the Solicitors Act, section 20 of the Limitations Act, 2002 preserves the special circumstances exception set out in sections 4 and 11 of the Solicitors Act.

Applying this rule of law to the case, the client had to show special circumstances in two aspects: first, because she had actually paid the account (section 11) and second, because more than 2 years had elapsed from its delivery (i.e. the 12-month period in section 4 was extended to 2 years because of the Limitations Act, 2002).

More

The Court noted that special circumstances for purposes of section 4 were not necessarily special circumstances for purposes of section 11. “For example, the fact that an account was paid under a mistake may be relevant to the ‘special circumstances’ required by s.11 of the Solicitors Act, but not to the ‘special circumstances’ required in s.4. Similarly, a disabling illness suffered after the payment of the account may constitute a ‘special circumstance’ under s.4 of the Solicitors Act, but have no relevance to the ‘special circumstance’ enquiry under s.11.”

The motions judge had found that there were special circumstances. The Court did not feel that there was an error in principle or a clearly unreasonable result and therefore did not interfere with that finding.

Transition

We have not mentioned the transition rules. The Court did, but only as an after-thought because it wished to establish go-forward rules. The Court determined that the client knew in 2003 that the account might be unreasonable and therefore the old Limitations Act applied. Since that old Limitations Act applied, it was subject to the previous version of the Solicitors Act. However, the previous version of the Solicitors Act had been interpreted such that sections 4 and 11 had a 12-month limitation period subject to special circumstances. Since there were special circumstances, the client was still successful.

Result

The Court stated “my interpretation of the Limitations Act and the Solicitors Act means that there is no absolute time bar against applications for the assessment of lawyers’ accounts.” Too bad (our summary of the reasons on this issue)! Although the passage of time will be a significant consideration in exercising the special circumstances discretion in both sections 4 and 11, time alone will not preclude an assessment if other circumstances compel a review of the accounts.