Three-judge panel remits case to Law Society of B.C. rather than letting chambers judge ruling stand
The Court of Appeal for British Columbia has ruled that the Law Society of B.C.’s decision to publicly name a lawyer who received a citation for professional misconduct was “unreasonable” because the process was not transparent and adequately explained.
However, the three-judge panel ruled the matter should be remitted to the regulatory body rather than letting stand a chambers judge ruling that quashes the society’s decision to name the lawyer.
“The decision [to deny a request to issue an anonymous citation] was unreasonable as it failed to demonstrate justification and transparency,” Justice Bruce Butler wrote in a decision released in late March.
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Butler, writing on behalf the panel, also ruled that a chambers judge who had quashed the law society’s decision to name the lawyer “erred in failing to remit the matter to the law society for determination.”
“The legislature has delegated responsibility for developing processes and policies for the regulation of the profession to the law society, including those regarding anonymization of citations,” the judge wrote.
The law society had issued a citation against the lawyer for misconduct by taking “unreasonably high” fees from a trust fund without entitlement. The lawyer applied to the society’s executive director, requesting the citation not to name the lawyer.
The lawyer “takes the position that he intends to defend against the allegations set out in the citation,” Butler wrote. He suggested that publication of his name and the citation would have a “ruinous” impact on his professional reputation and livelihood. Further, “publication would also have implications for employees and other lawyers associated with [the lawyer’s] law firm.”
The executive director at the law society dismissed the request, saying in a June 2019 decision that he had the discretion to anonymize the citation. He said he also followed the established practice of previous executive directors of not doing so “except in rare and exceptional cases” that would outweigh the public interest.
The details of this case did not meet that standard, the executive director ruled. The public is entitled to know the name of a cited lawyer so that they can make an informed choice when considering whether to retain that lawyer.
This decision prompted the lawyer to seek judicial review through the Supreme Court of British Columbia. The chambers judge quashed the executive director’s decision and issued an order of mandamus restraining the law society from publishing the lawyer’s name. The judge said it was more expeditious to substitute her own decision than send the matter back to the law society for reconsideration.
She reasoned that the law society rules distinguish between pre-hearing and post-hearing publication of a lawyer’s name. Different tests should be applied depending on the stage of the disciplinary proceedings. She also reasoned a lawyer has a right to be presumed innocent and that the post-conviction test should not be applied “by rote” at an earlier stage.
The chambers judge ruled that reputation and privacy are significant concerns. She added the executive director failed to meaningfully address the risk of irreparable damage to the petitioner’s reputation should the citation be published.
Following this ruling, the law society applied to the appeal court to uphold the executive director’s original decision. It argued that the chambers judge erred in her application of the reasonableness standard of review and “failed to show any meaningful deference to the [law society’s] decision.”
By dictating the internal standard to be applied by the law society, the society argued the judge went beyond the exercise of its purely supervisory role. It said it was not the judge’s role to decide how to balance lawyers’ private interests in their reputations against competing public interests when a citation is issued. Instead, her role was merely to determine whether the balance struck by the law society was reasonable.
The lawyer facing the citation has practised in British Columbia since 1978. He has a well‑established real estate and trust practice and trustee or a co-trustee of various private trusts with approximately $100 million in assets.
The conduct in question relates to the lawyer’s involvement with an estate plan established in 2007 for his client, a woman with “assets of some significance.” The estate plan included creating an Alter Ego Trust under which she was the sole beneficiary during her lifetime and was also the initial trustee. The lawyer was to act as the successor trustee in the event of the client’s death or that she be declared mentally incompetent. He also had an enduring power of attorney.
In 2008, the client moved into a care home. At that time, the lawyer received a medical opinion from a treating physician stating she could not manage her affairs and care decisions. Acting under the enduring power of attorney, or as trustee, the lawyer “undertook all personal and financial responsibilities for the client, the trust and its assets.”
He charged the client an hourly rate for managing and administering her affairs. Up to the date of the law society’s involvement, the lawyer had taken approximately $475,000 in fees from the trust.
After the client died in 2016, the law society began an investigation into the lawyer’s actions. On April 4, 2019, the society’s discipline committee directed the executive director to issue the citation.
The citation alleges the lawyer committed professional misconduct between 2011 and 2019 by taking fees from the trust when he was not entitled to those fees and taking payments unreasonably high or not correctly charged to the client.
The lawyer’s position on the citation’s merits is that the trust terms did not require him to obtain court approval before taking the fees in question, nor did the law. Further, the terms of the trust permitted him to use his discretion to determine the amount of his fees as trustee.
The lawyer argued the law society’s position “was based on an incorrect view of the law and that the question as to the correct legal position must be decided by the court.”
He also petitioned the B.C. Supreme Court seeking directions on the laws according to the Trustee Act’s provisions. On January 22, 2021, the court upheld the lawyer’s view of the law.
The judge in that application “concluded that the lawyer was permitted to take fees from the trust without seeking court approval in advance,” Justice Butler wrote. However, “the question as to the reasonableness of fees charged to the trust was referred to the registrar for assessment.”
Justice Butler wrote that this decision might have an impact on how this case proceeds. “It appears to me that the court’s ruling is a factor that will have to be taken into account in deciding whether to publish the citation without anonymization.”
After that decision, the law society agreed it would refrain from publishing the citation until the lawyer has had a reasonable opportunity to apply to the society’s discipline committee to rescind the citation.
Justice Butler pointed to the law society’s decision last May to amend their rules to codify the practice of publication of names and when anonymization is appropriate. Under the amended policy, the executive director must publish a citation, subject to a member’s right to apply to the president of the law society to order that the member not be identified.
Noel Semple, associate professor at the University of Windsor’s faculty of law, says the B.C. case demonstrates the importance of having “a clear policy that is understood by lawyers.”
He adds, “it’s unfortunate, just as a matter of procedure, that there have been so many hearings and decisions on this one case — clearer guidelines would help.”
Andrew Flavelle Martin, assistant professor at the Schulich School of Law at Dalhousie University, notes the practice of issuing public citations for lawyers facing allegations developed in recent years as a move towards greater transparency.
It is especially important because the legal profession is regulated. “if there is anything particular about lawyers that favours the argument of publicly naming them in citations, it is because they are in a position of trust.”
However, the “big question,” he says, is how to balance the impact on a lawyer’s reputation against the public’s right to choose what lawyer to use based on access to critical information.
Semple agrees, saying a lawyer’s reputation is “their bread and butter,” but at the same time, “if the law society has good reason to believe something is seriously wrong, it would be damaging to keep that under wraps until the entire process is completed.”