Executive Summary: Key Legal and Evidentiary Issues

• Two commercial clients asked the court to set aside retainer agreements covering a $12.5-million land sale and a $145-million refinancing.
   
• Fairness turned on whether the applicants understood and appreciated the fee terms before signing.
   
• Reasonableness turned on the scale, complexity, and risk of each transaction relative to the fee charged.
   
• Alleged misrepresentations about industry-standard rates were found unsupported by any evidence of falsity.
   
• Opinion evidence from a party to the proceeding and hearsay evidence from a bank employee were both excluded from consideration.
   
• Both retainer agreements were upheld as fair and reasonable, and the application was dismissed with no costs award.
   

Facts of the case

Hutterian Brethren Church of Hillcrest and five related corporate entities retained Procido LLP, along with lawyers Hannah Pasloski and Chad Eggerman, for two transactions. The first was the sale of 24 quarter-sections of farmland to Veripath Farmland LP for $12.5 million. The second was a refinancing with the Bank of Montreal for a $145-million loan, of which $97,950,000 was advanced at closing. Leonard Wollman signed the retainer agreement for the Veripath sale on May 26, 2025, and Ben Wollman signed the BMO retainer agreement on July 3, 2025. On the Veripath sale, the law firm charged a fee of $93,750.00, calculated at 0.75% of the purchase price, which was paid from the sale proceeds. On the BMO financing, the firm's invoice included a fee of $734,625.00, being 0.75% of the amount advanced at closing; the applicants did not pay this account, and the parties agreed the disbursements would be paid from trust funds while the fee remained unpaid pending these proceedings. The applicants brought an application asking the court to set aside both retainer agreements as unfair and unreasonable, to extend the time for assessment of the Veripath account, to conduct a quantum meruit assessment of both accounts, and to restrain the law firm from acting on the accounts pending determination of the proceedings.

Policy, legislative, and contractual provisions at issue

The applicants' challenge rested on sections 64 and 67 of The Legal Profession Act, 1990. Section 64 permits a lawyer to contract for remuneration on a basis other than fee-for-service, and allows a judge to determine whether such an agreement is fair and reasonable. Section 67 governs assessment of a lawyer's bill, including the 30-day window for a client to apply for assessment and the court's discretion to extend that window "if the court is satisfied that it is in the interests of justice to do so." The applicants also invoked Rule 3.6-1 of the Law Society of Saskatchewan's Code of Professional Conduct, which requires that a fee be fair and reasonable and disclosed in a timely fashion, along with its accompanying commentary listing factors relevant to reasonableness, including time and effort, complexity, results obtained, and any relevant agreement between lawyer and client. On the contractual side, the Veripath retainer agreement did not specify a fee amount or calculation method, while the BMO retainer agreement stated a rate of 0.75%, to be applied to the amount advanced at closing rather than the full loan amount.

Reasoning and analysis

Drawing on Zipchen v Bainbridge, 2008 SKCA 87, the court applied a two-part test: fairness depends on whether the client fully understood and appreciated the agreement without undue advantage being taken, while reasonableness depends on the fee relative to the work anticipated, the work done, the risk undertaken, and the circumstances of the case. On fairness, the court found that both Ben Wollman and Leonard Wollman had reviewed a preliminary statement of adjustments before signing the Veripath agreement, which set out the 0.75% rate and the resulting fee, and that this evidence from Ms. Pasloski was uncontroverted. Similar findings applied to the BMO agreement, where the applicants had negotiated the fee down from being calculated on the full $145 million to being calculated on the $97,950,000 advanced at closing, demonstrating their understanding of the fee structure. The applicants' allegations of misrepresentation, that the fee was falsely described as a "discount" and that other firms would supposedly charge 3%, were rejected because no evidence showed either statement to be untrue, inaccurate, or misleading, which the court held is required to establish a misrepresentation, citing Cattell v Lazar, 2024 SKKB 163. On reasonableness, the court accepted that larger, more complex transactions justify larger fees, and found that the scale of both transactions, the extensive work performed, and the risks assumed by the firm (including proceeding without an advance deposit) supported the fees charged. Two evidentiary issues affected this analysis. Mr. Eggerman's evidence about how other firms typically charge fees was ruled inadmissible opinion evidence because he was a party to the proceedings and lacked independence. Michael Fulton's affidavit, offered by the applicants to compare fees on other transactions, was disregarded in its entirety: his account of discussions with the applicants was irrelevant, his information about other lawyers' fees was inadmissible hearsay, and his reference to fees BMO paid its own lawyer was not comparable given the different role of that lawyer.

Ruling and overall outcome

The court granted the applicants' request to extend the time for assessment of the Veripath account under section 67(1)(a)(iii), finding no reason to refuse it given the law firm's tacit consent. The court declined to order a restraint against the law firm, finding it unnecessary since the firm had already undertaken to hold disputed funds in trust pending the outcome. On the central issues, the court concluded that both the Veripath retainer agreement and the BMO retainer agreement were fair and reasonable. The successful parties were the respondents, Procido LLP, Hannah Pasloski, and Chad Eggerman, whose retainer agreements were upheld in full. Because the application was dismissed, no quantum meruit assessment or adjustment to either fee was ordered. On costs, the law firm did not seek costs of the application, and the court directed that each party bear its own costs, meaning no monetary award was made in either direction.