1999: No. 2 March-April

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When the Law Society President offers congratulations on your call to the bar, it is a special moment – but even more so when the President is your father. Christopher Wilson accepts his certificate from a beaming Warren Wilson, Q.C. at the call ceremony in Vancouver on March 19. Christopher Wilson clerked for Mr. Justice Hugessen of the Federal Court of Canada and articled at Bull, Housser & Tupper where he now practises as an associate.

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Law Society will study limited liability partnerships for lawyers

Martin Linsley (left), a member of the Accountants’ Professional Liability Committee of the Institute of Chartered Accountants of B.C., and John Dawson (right), President of the Institute, along with Gary Powroznik, Chair of the Professional Liability Committee (not pictured), update the Benchers at their March meeting on the Institute’s work on limited liability partnerships.

In April the Benchers welcomed lawyer Rosemarie Wertschek of McCarthy Tétrault to discuss the issue in relation to the legal profession.

After considering a Futures Task Force discussion paper, the Benchers have decided that they wish to take a closer look at whether limited liability partnerships would be an appropriate practice structure for lawyers.

*    *    *

At their April meeting, the Benchers discussed a paper on limited liability partnerships prepared by the Futures Task Force and decided to take a closer look at whether this form of partnership might be an appropriate practice structure for B.C. lawyers. The Futures Task Force has been asked to probe this issue further and report back.

Professionals in Ontario received the right to practise in limited liability partnerships last year, in line with a trend in the United States that began in 1991.

As far as the personal liability of partners is concerned, the Task Force pointed out, limited liability partnerships fall midway between general partnerships and limited partnerships. Limited liability partners are only liable to lose their investment in partnership assets. Unless personally responsible for the loss, the partner faces no personal exposure beyond his or her interest in the partnership assets. If applied to a negligence claim against a law firm, only the assets of the partnership and the personal assets of the responsible partner would be available to satisfy the judgment.

While the Law Society strives to ensure the public is protected and well served by the legal profession, limiting liability need not compromise that objective.

The Task Force noted the following:

• It is in the public interest that lawyers join together in practice, to help ensure "best practices" within a firm and controls over trust accounts, limitations systems and conflicts checking.

• Business demands for professional expertise and the pressure partners place on each other ensure lawyer competence more effectively than the threat of personal exposure.

• While unlimited liability is intended to help ensure the public can recover losses from professional malpractice, mandatory liability insurance, such as exists for B.C. lawyers in private practice, already serves this purpose.

• Given the $1 million limit under the Lawyers Insurance Fund program, individual B.C. lawyers are unlikely to be financially liable for successful negligence claims, apart from the $5,000 deductible. While unlimited liability for malpractice constitutes a constraint against inappropriate practice, mandatory insurance makes the constraint largely theoretical.

• Inadequacy in insurance coverage is unlikely to be a problem, but to the extent it is considered an increased risk, lawyers could be obligated to carry adequate coverage relative to particular transactions

The Futures Task Force also noted that the question of limited liability partnerships was relevant to multidisciplinary partnerships, especially those large international firms for which a limited partnership structure is preferred.

Limited liability partnerships have been a pressing issue for the B.C. accounting profession for several years. This March the Benchers heard from representatives of the Institute of Chartered Accountants of B.C. — John Dawson, Martin Linsley and Gary Powroznik — explain their quest for legislation to allow accountants in the province to practisein this form of partnership.

The chartered accountants, certified management accountants and certified general accountants together formed a task force in 1994 to study the use of limited liability partnerships as a business structure. The task force was responding to growing volatility in markets and economies that has resulted in large increases in the magnitude of business failures, coupled with increased litigiousness.

Mr. Powroznik noted that the six large accounting firms now face claims in excess of $40 billion. This situation is creating a crisis in which well qualified people are leaving the accounting profession and it is increasingly difficult to attract new people. Concern over the increasing exposure to very large claims may result in the withdrawal of auditing services from some high risk businesses. Mr. Linsley said that it is not unsophisticated clients seeking the large damages but large, sophisticated companies seeking to recoup business losses.

The Institute of Chartered Accountants have asked government to develop legislation for the year 2000, with a number of safeguards to protect the public.

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President’s View

One of the most important challenges facing all lawyers is safeguarding the reputation of the justice system. I believe that we have the best justice system in the world. It is transparent — what you see is what you get. Our judges make independent decisions without fear of threat and without obtaining favour. In making their decisions, they must consider legal precedents and respect constitutional protections guaranteed to all Canadians. Sometimes, in upholding individual rights, judges make decisions that are unpopular. We should be thankful, however, for a system of justice that can give rise to an unpopular decision based on a constitutional protection, rather than a decision dictated by what the public finds popular today. Individual freedoms are a cornerstone of society as we know it.

As good as our justice system is, we must continue to improve it. The cost of court proceedings has affected the ability of the middle class to have their disputes heard. How often do we hear that only the very poor and the very rich can afford to go to court? All of us involved in the justice system — police, lawyers, judges, social workers and others — must be vigilant to ensure that everyone can resolve their differences affordably.

Our recent public opinion survey indicates that lawyers can do a much better job of educating their clients and meeting or managing clients’ expectations. Nearly one-half of all clients involved in disputes said their lawyers did not meet their expectations of good value for the fees paid, and more than one-third felt their lawyers were not sensitive to their needs. Much of this dissatisfaction is directly related to clients’ lack of understanding of the justice process, what options they have and what can realistically be achieved. As lawyers, we must explain the process, communicate effectively and ensure that clients realize what alternative dispute resolution mechanisms are available that may be less expensive and quicker than the full court process.

Recently, the Attorney General hosted a justice reform consultation involving many key players in the justice system. It was encouraging to see what initiatives have been adopted or tried in recent months. I encourage each lawyer to become involved. Here are a few things you can do:

1. Support the Law Courts Education Society, which does excellent work in explaining to the public, especially new Canadians, how our courts and justice system works, and also the People’s Law School, which provides a variety of public legal education classes taught primarily by lawyer volunteers.

2. Help the media understand justice issues and the court system.

3. Do pro bono work for those who do not qualify for legal aid but cannot afford to pay for a lawyer.

4. Keep an open mind about new court rules and case management procedures and help to make them work.

5. (For prosecutors and defence counsel) Work together with the courts to reduce the average number of appearances in court required in criminal matters and to develop an accessible process for early resolution.

*   *   *

In closing, I would like to express my regret at the passing of Life Benchers David W.H. Tupper, Q.C. and Jack Webster. These two men deserve our highest respect and admiration — not only for their professional achievements but for the personal examples they set. David Tupper practised as a partner at Bull, Housser & Tupper in Vancouver prior to his retirement. Following in the tradition of his father and of his grandfather who founded the firm, he served as a Bencher for Vancouver (1979-1987) and as Treasurer of the Society (1987). I am proud to have known him and will greatly miss him at our Life Benchers dinner this year. I will also miss journalist Jack Webster, who in 1988 became our first Lay Bencher and served in that role for more than eight years. Jack never failed to focus on the public interest, whatever the issue before the Law Society, and he never hesitated to take on the lawyer Benchers, with his usual wit and force of conviction. We owe him, and the other Lay Benchers, a debt of gratitude for their insights. To the families of David Tupper and Jack Webster, I offer my condolences and also my thanks for supporting the service contribution David and Jack made as Benchers.

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Credentials Committee moves forward on PLTC entrance exam

A PLTC class, with students hard at work. An entrance exam for the program is expected to ensure that students have a broad base of substantive knowledge and that the focus of PLTC remains on skills training.

Late last year the Benchers gave the Credentials Committee approval to continue work on an entrance examination for the Professional Legal Training Course (PLTC), an exam expected to be introduced in 2001.

The exam will be written by students after they have completed law school and before they attend PLTC.

Why a new examination?

The Law Society provides a general practice licence to B.C. lawyers and, as a professional regulatory body, has a responsibility to protect the public by ensuring that lawyers have certain minimum qualifications to offer a broad range of services. Because of this, and because so many areas of law interrelate, lawyers need a substantial base of legal knowledge on entry into the profession, even though many will at some point choose to limit their practice.

The Credentials Committee proposed a PLTC entrance examination as a way of ensuring that students possess the necessary substantive and procedural knowledge for practice, and to do so earlier in the process than is now the case. Currently, PLTC students write a qualification examination designed to test their legal knowledge at the end of the program, and students focus considerable effort on preparing for that exam during PLTC. The proposal to introduce an entrance exam, and to phase out the qualification exam, should allow PLTC faculty and students to better focus on skills training, which is the main reason for the program.

A PLTC entrance exam is also intended to:

• shift some of the responsibility for learning from the providers of PLTC to the students;
• allow PLTC to plan and teach on the basis that all students have a common body of knowledge;
• clarify the Law Society’s expectations of law students; and
• preserve the autonomy of law schools.

By the Law Society clarifying its expectations, law students should be better able to structure their law school education in a way that best prepares them for entry into the program and the practice of law. The Credentials Committee and staff expect that the qualification exam would be phased out and replaced with skills and transactions assessments.

What will the examination test?

Although details of the entrance examination will be developed over the coming months, it will test the ability of students to identify basic legal issues and apply the relevant law, engage in a reasoned analysis of the issues, and arrive at a logical and ethical solution.

The standard required for admission to the Law Society will be no higher, but it will be clearer. Students will gain the benefit of taking the examination before making an investment in PLTC and, in most cases, articles.

Although the Society will continue consultations in deciding the subject areas to be examined, the following are anticipated:

• commercial law
• company law,
• criminal procedure,
• family law,
• real estate law,
• wills and estates law,
• civil litigation,
• administrative law,
• ethics/professional responsibility (integrated aspects), and
• tax law (integrated aspects).

This list of courses was developed after consideration of the following:

• the areas in which newly called lawyers practise during their first five years;
• the skills and knowledge that lawyers are expected to need in the future;
• results of a 1994 Law Society survey of newly called lawyers;
• the subject areas that are currently tested in the qualification examinations;
• the PLTC practice materials, which are now available to support the examination;
• courses currently available to LL.B. students during law school;
• initial input from law students, law faculty and PLTC faculty; and
• those courses that other Canadian law societies now require in law school.

The Credentials Committee will consider whether the Society should make specific recommendations to law students about which law school courses would best prepare them for the entrance exam.

How will the examination be developed?

The content and form of the entrance examination will be developed by the Law Society in consultation with lawyers, professional legal trainers, academics and assessment experts. The Credentials Committee hopes that the examination will provide a model for other provinces.

When will the examination be introduced?

After initial consultations with law faculties across Canada, the Credentials Committee and staff have concluded that the faculties and students will need some lead time to adjust their curricula and course selection. The Committee anticipates introducing the PLTC entrance exam in two years, with the first sitting in 2001.

What about supporting materials?

Before the new examination is introduced, the Law Society will prepare study materials or outlines, with the assistance of lawyers and academics. It is anticipated that the materials will cover all examinable material in a self-study format. The volumes of PLTC practice materials that students currently use to prepare for the qualification exam will serve as the starting point for developing the new materials.

What about students who do not pass?

The Credentials Committee will consider what options, such as a remedial track, will be developed for students who do not pass one or more components of the entrance examination.

Any other questions?

If you have other questions about the new PLTC entrance examination, please contact:

Maureen F. Fitzgerald
Policy and Research Lawyer
The Law Society of British Columbia
845 Cambie Street
Vancouver, B.C. V6B 4Z9
mfitzgerald@lsbc.org

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Benchers discuss delegation by lawyers of tort claim negotiations

At their March meeting, the Benchers discussed a recommendation of the Ethics Committee to amend Chapter 12, Rule 8(d) of the Professional Conduct Handbook to allow lawyers to delegate to their legal assistants the negotiation of tort claims. Further discussion of the issue has been put over to a future Benchers agenda.

Rule 8(d) currently permits a lawyer to delegate to a legal assistant certain work in litigation matters, including the negotiation of claims where the amount involved does not justify the cost of a lawyer’s time. The rule, however, specifically prohibits the delegation of such negotiations in tort claims.

In the view of the Ethics Committee, the distinction between tort claims and other claims is not rational, and the Committee recommended eliminating the prohibition in relation to tort claims.

In speaking in favour of the motion, Ethics Chair Emily Reid, Q.C. noted that there are already safeguards in the Rules. A lawyer has an obligation to supervise a legal assistant adequately and remains responsible for the work. As well, it is clear that legal assistants may negotiate claims only when the amount involved does not justify a lawyer’s time. Another Bencher noted that lawyers must find ways of reducing the cost of legal services, which includes the appropriate use of legal assistants.

In speaking against dropping the prohibition, several Benchers pointed out that there is a critical difference between a legal assistant negotiating a liquidated claim as opposed to an unliquidated claim, which is likely to be more complex.

*   *   *

In March the Benchers looked at a formal mandate for the Ethics Committee and approved that recommended by the Committee.

Accordingly, the Committee has responsibility for:

• developing recommendations on policies concerning substantive matters of professional responsbility for consideration by the Benchers;

• identifying current issues of professional responsibility;

• interpreting existing rules and giving advice to individual lawyers and to lawyers at large on matters of professional responsibility;

• publishing Committee opinions of general interest to lawyers in the Benchers’ Bulletin.

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From the Ethics Committee

Acting for and against a client in unrelated matters: new rule proposed

The Ethics Committee is considering proposing to the Benchers changes to the Professional Conduct Handbook to permit a lawyer to act for a client on one matter, and against the same client on another matter, provided the matters are wholly unrelated and provided the clients affected give informed consent.

The Committee looked at this issue at the request of the Discipline Committee, and is now seeking comment from the profession.

Currently, Chapter 6, Rule 7 of the Handbook deals with lawyers acting against former clients. Rule 7 states:

Acting against a former client

7. A lawyer must not represent a client whose interests conflict with those of a former client, unless:

(a) the former client gives informed consent to the lawyer’s new representation,

(b) the new representation is wholly unrelated to the lawyer’s representation of the former client, and the lawyer does not possess confidential information arising from the representation of the former client that might reasonably affect the new representation, or

(c) the new representation is otherwise permitted under Rule 7.4.

It is common for some lawyers to act for and against government, large corporations and even the Law Society on different matters. While there is a rule prohibiting a lawyer from acting against a former client, there is no provision in the Handbook dealing with acting both for and against a current client. One arguable interpretation of the Handbook is that the principle behind Rule 7 would also prohibit a lawyer from acting both for and against current clients, even where the matters are unrelated.

Gavin MacKenzie, in Lawyers and Ethics, Thomson Canada Ltd. (1993) at p. 5-5, discusses the situation of a lawyer acting against current clients in unrelated litigation. He notes that there is an absence of Canadian authority on the issue. Some American courts have virtually prohibited lawyers from acting, while others have enjoined lawyers from acting only when there is a substantial relationship between the two matters.

MacKenzie argues that, in the absence of Canadian authority or rules of professional conduct, one is free to choose either of the American approaches.

Prince Edward Island, Newfoundland and New Brunswick all make use of the Canadian Bar Association 1987 Code of Professional Conduct. The CBA Code does not make express provision for a lawyer acting against a current client and neither do the codes of professional conduct of the Law Societies of Saskatchewan, Manitoba, Ontario and Nova Scotia. These codes have general provisions permitting a lawyer to argue that it is proper to act for and against a client on unrelated matters, provided clients give their informed consent to such representation.

Chapter 6, paragraph 3 of the Law Society of Alberta Professional Conduct Handbook allows a lawyer to act against a current client in some circumstances:

Except with the consent of the client or former client, a lawyer must not act against a client or former client if the lawyer has confidential information that could be used to that person’s disadvantage in the new representation.

The American Bar Association Model Rules of Professional Conduct permit a lawyer in some circumstances to act against a client the lawyer represents in some other matter. Rule 1.7 states:

(a) A lawyer shall not represent a client if the representation of that client will be directly adverse to another client, unless;

(1) the lawyer reasonably believes the representation will not adversely affect the relationship with the other client; and

(2) each client consents after consultation.

(b) A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer’s responsibilities to another client or to a third person, or by the lawyer’s own interests, unless:

(1) the lawyer reasonably believes the representation will not be adversely affected; and

(2) the client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved.

*   *   *

The Ethics Committee welcomes your comments on this issue and the proposal to revise the Handbook. Please contact Jack Olsen, Staff Lawyer – Ethics, by May 20, 1999 at:

Law Society of British Columbia
845 Cambie St.
Vancouver, BC V6B 4Z9
Telephone (604) 443-5711
Fax (604) 605-5399
E-mail: jolsen@lsbc.org

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From the Ethics Committee

Comment sought on proposed changes to marketing rules

In 1997 the Ethics Committee invited lawyers to express their views generally on the marketing rules in Chapter 14 of the Professional Conduct Handbook. The Committee considered the comments received and brought a number of issues before the Benchers last year.

In September and October, 1998, the Benchers expressed an interest in changing the marketing provisions in Chapter 14, Rules 4, 5 and 16. The Ethics Committee would now like to invite comment from the profession on the proposed rule changes before taking them back to the Benchers for final decision.

Rules 4 and 5 currently state:

4.  Any marketing activity undertaken or authorized by a lawyer must not be:

(a)  false,

(b)  inaccurate,

(c)  unverifiable,

(d)  reasonably capable of misleading the recipient or intended recipient, or

(e)  contrary to the best interests of the public or to the maintenance of a high standard of professionalism.

5.  For example, a marketing activity violates Rule 4 if it:

(a)  is calculated or likely to take advantage of the weakened state, either physical or emotional, of the recipient,

(b)  is likely to create in the mind of the recipient or intended recipient an unjustified expectation about the results which the lawyer can achieve,

(c)  implies that the lawyer can obtain results:

(i)  not achievable by other lawyers,

(ii)  by improperly influencing a court or other public body or official, or

(iii)  by any other improper means,

(d)  compares the quality of services provided with those provided by another lawyer, or

(e)  is conducted in unseemly circumstances such as by the offer of legal services at a courthouse where the services of duty counsel employed by the Legal Services Society are available.

Changes under consideration for Rules 4 and 5 are the following:

• adding a provision prohibiting the use of testimonials;

• adding a provision prohibiting the use of ads that imply a lawyer is aggressive;

• adding a provision prohibiting the use of ads that state the amount that a lawyer has recovered for clients; and

• removing the example in Rule 5(e).

The rationale for considering these changes is that lawyer advertising that offers testimonials regarding a lawyer’s services or success, that states the amount a lawyer has recovered or that suggests lawyers are particularly aggressive (through the use of fierce animals as logos, or through other means) offer no assistance to the public in choosing a lawyer. Such ads are either inherently misleading or unseemly and bring the legal profession into disrepute.

The rationale for removing the example in Rule 5(e) (the offer of legal services at a courthouse where the services of duty counsel employed by the Legal Services Society are available) is that it is too specific to be helpful. The offer of services by lawyers needs to be looked at in context when considering what are "unseemly circumstances."

Rule 16 currently states:

16.  A lawyer may state in any marketing activity a preference for practice in any one or more fields of law if the lawyer:

(a)  has been engaged in the practice of law for at least three years,

(b)  regularly practises in each field of law in respect of which the lawyer wishes to state a preference, and

(c)  has, during the most recent three-year period that the lawyer has practised, devoted at least 20% of his or her time to practising in each field of law in respect of which the lawyer wishes to state a preference.

The Ethics Committee and the Benchers are considering removing the requirement under Rule 16 that a lawyer must have been in practice for three years (or any other period of time) in order to state a preference. A requirement that the lawyer actually practise in the area for which a preference is stated would replace the time requirement.

A criticism of the current Rule 16 is that it prevents lawyers who practise in particular areas from giving factual information about their practices because they have not practised for the required three years. The Rule may have the unintended effect of inducing some lawyers to practise in areas in which they are inexperienced and would prefer not to venture.

*   *   *

If you would like to comment on the issues raised by these possible changes, please contact Jack Olsen, Staff Lawyer – Ethics, by May 20, 1999 at:

Law Society of British Columbia
845 Cambie Street
Vancouver, B.C. V6B 4Z9
Telephone (604) 443-5711
Fax (604) 605-5399
E-mail: jolsen@lsbc.org

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Ethical duties of Crown Counsel withdrawing services

An opinion of the Ethics Committee (March 3, 1999)

The Criminal Justice Branch of the Ministry of the Attorney General has asked this Committee for a review of the professional responsibilities of lawyers employed as Crown Counsel when engaged in a collective action to withdraw services. This follows on the announcement by the British Columbia Crown Counsel Association of a study session to take place on two consecutive days in March, 1999. The Committee has had the benefit of submissions on behalf of both the Association and the Branch. We were advised that the Association gave the Branch four weeks notice of the specific dates on which services would be withdrawn and three additional weeks notice that a withdrawal of services would take place.

In 1991 and in 1994, this Committee gave its opinion on whether there was any conflict between the ethical duties of legal aid lawyers and the collective action taken by them at that time. Those opinions were published in the April-May, 1991 and July-August, 1994 Benchers’ Bulletins. In 1998, the Ethics Committee was asked to reconsider its opinion and reaffirmed it in an opinion that was provided to the interested parties.

To the extent that those opinions apply in the current situation, they remain the opinions of the Committee.

1. Refusing new files

In 1991 and 1994, the Committee was unanimously of the view that it is not unethical for a lawyer to refuse to take a new case. The current situation is not the same in that there is an employment contract, which includes an agreement to accept new files as assigned by the employer. However, breach of that contract does not necessarily give rise to ethical issues.

2. Withdrawing from cases in progress

Chapter 10 of the Professional Conduct Handbook governs the occasions on which lawyers are permitted (or in some cases, required) to withdraw from matters in progress. These provisions apply to Crown Counsel as much as to lawyers in private practice.

The relevant parts of that chapter are:

Residual right to withdraw

3.  In situations not covered by Rules 1 and 2, a lawyer may sever the solicitor-client relationship or withdraw as counsel only if the severance or withdrawal:

(a)  will not be unfair to the client, and

(b)  is not done for an improper purpose.

4.  Unfairness to the client will depend on the circumstances of each case, but will normally include consideration of whether the severance or withdrawal will:

(a)  occur at a stage in the proceedings where the client will have to retain another lawyer to do the same work, or part of it, again,

(b)  leave the client with insufficient time to retain another lawyer, and

(c)  give the newly retained replacement lawyer insufficient time to prepare to represent the client.

5.  Impropriety will depend on the circumstances of each case, but will include severance or withdrawal in order to:

(a)  delay court proceedings, and

(b)  assist the client in effecting an improper purpose.

It is not the intention of the Ethics Committee to comment on the merits of the proposed withdrawal of services. For the purposes of this opinion, we assume that support of that withdrawal of services is not an improper purpose for withdrawing from representing a client, including the provincial Crown. It is the responsibility of each lawyer to ensure that he or she does not withdraw for an improper purpose.

In the context of a withdrawal of legal aid services, it was the Committee’s opinion that it is not permissible for a lawyer to withdraw from a matter in support of a collective withdrawal of services without the consent of the client, either as an express term of the retainer agreement or by informed consent freely given at the time of the withdrawal.

That was because, when the client is an individual legal aid client, that breach of contract would be unfair to the client, which is prohibited under Rule 3(a). When the client has the resources available to the Province of British Columbia, the result may be different. However, even in that case, there may be instances when no amount of notice would be sufficient to allow withdrawal.

It is the Committee’s view that the work that Crown Counsel perform is critical and that, in the context of a collective withdrawal of services, the question of when a lawyer may withdraw from a Crown Counsel commitment cannot be made without due regard for the interests of Crown, the courts, potential accused persons and others involved in the justice system.

The Committee concluded that a decision in this context that permitted lawyers to withdraw from a commitment to perform Crown Counsel services, by simply giving notice, did not give sufficient recognition to the essential role that Crown Counsel play in the justice system. It depends on the facts of individual cases whether it is unfair to the Crown and the other parties to the criminal justice system for Crown Counsel to withdraw on the notice given in the present circumstances.

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Practice Watch

Your Practice Standards Advisor Felicia S. Folk, the Law Society's Practice Standards Advisor, is available to discuss your practice concerns. All communications between Ms. Folk and lawyers are strictly confidential, except in cases of trust funds shortages. You are invited to call her at (604) 669-2533 or toll-free in B.C. 1-800-903-5300 at any time, or write to her at the Law Society office.

Sworn statements from witnesses

In Pierre v. Lil’Wat Nation, [1999] BCJ No. 17 (SC), Fraser, J. reminded counsel that it is improper to have a prospective witness provide a statement under oath, before trial, if there is no intention to use it as primary evidence. The Court said:

This is because of the overriding interest of the system (and of society) in hearing accurate and truthful evidence at trial.

Binding a witness to a statement made before trial by having it sworn compromises this interest by setting up serious consequences for a witness who wishes to testify truthfully, when the truth is in conflict with the statement. The threat to the fact-finding process is the more insidious when it is understood that if the testimony at trial is consistent with the sworn statement, the Court may never learn of the existence of the statement.

It is good and prudent practice to obtain a written statement from a prospective witness. However, be advised to resist the temptation to request a sworn statement, which the court considers an improper attempt to fetter the conscience of the witness.

Obtaining an affidavit from a witness is perfectly proper if the intention is to tender the affidavit as evidence, as opposed to having it available for impeachment.

Declining to take a file

Here are some statements frequently seen in lawyers’ letters responding to complaints made to the Law Society:

I was reluctant to take on this file, but ...

I agreed to take on the file to help out my friend, but ...

I had doubts about the merit of the action, but ...

I was aware that this was an aggressive and overly demanding client, but ...

In hindsight, I had taken on far more work than I could handle at that time. My practice was extremely busy, but ...

If you are taking on files when these statements apply, reconsider your approach and remember:

• not every lawyer suits every client;
• there are times in a lawyer’s life when taking on a new matter is a mistake;
• your instincts are probably correct.

Loss Prevention Seminar 1999

Choice of law clauses

Unless a choice of forum or choice of law clause gives exclusive jurisdiction to a particular court, there may be concurrent jurisdiction in another forum. In Old North State Brewing Co. v. Newlands Services Inc. (1998), 158 DLR (4th) 765 ( BCCA.), the defendant in B.C. failed to participate in proceedings in North Carolina and default judgment was taken. The plaintiff was successful in enforcing the U.S. judgment in B.C. despite the defendant’s assertion that the U.S. court had wrongfully assumed jurisdiction in the face of a clause in the contract providing that the contract would be governed by and interpreted in accordance with B.C. law.

The B.C. Court of Appeal found that there was a real and substantial connection between the plaintiff’s claim and the North Carolina jurisdiction. The Court concluded that the choice of forum clause in the contract did not give the B.C. court exclusive jurisdiction, but that the North Carolina court had concurrent jurisdiction. In the result, the foreign judgment could be enforced even though it was harsher than a B.C. court would have ordered.

The Court of Appeal observed that the parties could have used language that would have had the effect of making the B.C. court’s jurisdiction exclusive.

Use of documents for a collateral purpose may be contempt of court

In Sandbar Construction Limited v. Howon Industries Ltd., [1998] BCJ No. 1689 (S.C.), the defendant sought a determination that the plaintiff’s lawyer was in contempt of court for breach of the implied obligation not to use documents obtained during discovery for a collateral purpose. Without deciding that the facts in that matter actually constituted contempt, Quijano, J. concluded that breach of the implied obligation can give rise to contempt proceedings.

Timber reservations and root of title

When researching a title where the current title, if original Crown grant discloses a timber reservation in favour of the Crown, or if it is not readily apparent whether the timber reservation is still in force, it is important to check the root of title. You may seek direction from the Land Management Division of the British Columbia Assets and Land Corporation relative to timber ownership, stumpage requirements and the process for removing timber provisos when all the conditions of the covenant have been met. Copies of the original Crown grants are available from the Land Title Office, Ministry of the Attorney General or Crown Land Registry Services, Ministry of Environment, Lands and Parks.

Year 2000

It is hard to imagine that there is anybody still unaware of the Y2K problem. However, solutions to the problem seem to be less clear. Please read the article on Y2K written by the Lawyers Insurance Fund claims counsel in the April, 1999 Alert Bulletin.

Scams to watch for!

First warning: Be careful when you dispose of old letterhead. An Ontario law firm’s old letterhead is being used in what appears to be a mail fraud scheme operating from the Vancouver area, targeting United States residents.

Second warning: A member has provided the Law Society with a false invoice he received for over $900 from a company with a local address and phone number. The firm had neither ordered nor received any goods from the company and the address and phone number lead to dead ends. Because this lawyer and his staff were careful about their accounts payable, he was not defrauded.

Be careful when signing cheques payable to suppliers, particularly if you are having staff changes or have temporary staff who are not familiar with your usual suppliers.

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Government introduces B.C. Online transaction fee

The provincial government has announced that, beginning May 1, 1999, it will introduce a $1.50 service charge on B.C. OnLine transactions. The government has also reported that it is now completing negotiations with MacDonald Dettwiler and Associates as a potential private sector operating partner that would bring additional capital and commercial management to the service.

When the privatization of B.C. Online was first announced in 1997, the Law Society raised concerns about the need to protect the privacy of individuals and ensure the service remained affordable and accessible.

The Society recommended that fees be controlled by an independent body both for monitoring services and to promote continued affordability for all users, and that there be a public fee review process prior to any fee changes.

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Law Society AGM set for September 24

It is time to mark your calendars for the 1999 Annual General Meeting which takes place on Friday, September 24.

The main location for the meeting will be in Vancouver, with audioconference locations planned for Victoria, Prince George, Kelowna, Kamloops and Smithers. There will an additional audioconference site in Cariboo and also sites in Kootenay and Nanaimo districts, with city locations still to be decided.

Further details will follow.

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Downtown Vancouver firms to keep articling offers open to August 23

The Credentials Committee has announced that law firms with an office in the downtown core of Vancouver (west of Carrall Street and north of False Creek) must keep open all offers of articling positions they make this year until at least 12:00 noon on Monday, August 23, 1999.

This date is set each year pursuant to Rule 2-31 to ensure students have an opportunity to consider more than one firm’s offer in interviewing for articles. The rule applies to offers made to second-year law students or first-year law students, but not to offers to third-year law students or offers of summer positions (temporary articles).

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