Executive Summary: Key Legal and Evidentiary Issues

• The Court of Appeal for Saskatchewan dismissed Birch Narrows Dene Nation's appeal from a Chambers decision fixing legal fees owed to Duboff Edwards Schachter Law Corporation at $4 million.
   
• Admissibility of expert opinion evidence from a former Chief Justice of the Manitoba Court of Appeal, tendered on the fairness and reasonableness of the counsel fee, was upheld as meeting the Mohan and White Burgess threshold requirements.
   
• Two separate retainers were found to exist between the appellants and DES, with the second retainer including an additional counsel fee over and above hourly billings.
   
• Application of the Yule–Zipchen–McLean factors on a quantum meruit basis was found appropriate given the existence of a retainer providing for a fee beyond hourly rates.
   
• An unenforceable oral agreement regarding a counsel fee could nonetheless be considered as one factor in the fairness and reasonableness assessment.
   
• No palpable and overriding error was found in the Chambers judge's factual findings regarding risk, complexity, results achieved, or the quality of counsel's work.
   

Facts of the case

Birch Narrows Dene Nation and Buffalo River Dene Nation retained Duboff Edwards Schachter Law Corporation (DES) in connection with a long-running claim against Canada alleging infringement of treaty and Aboriginal rights arising from the establishment of the Cold Lake Air Weapons Range in approximately 1952. The action was commenced in 1996 with Bruce Slusar as lead counsel. Harley Schachter of DES was brought in to assist in 2013 to resist an application by Canada to strike the claim for want of prosecution, initially billing at $375 per hour under a limited retainer. Mr. Slusar's services were terminated [the source gives two dates for this: para 197 of the Chambers Decision states Slusar was terminated in May 2014, while the background section states the termination was formalized by band council resolution in early 2015], after which DES was retained as sole counsel; there was no written retainer agreement for this second engagement, though DES continued to render monthly statements at the same hourly rates for Mr. Schachter and associate Kaitlyn Lewis, who billed at $215 per hour.

DES took substantial steps to advance the claim, including amending pleadings, adding a constitutional claim, gathering evidence, and preparing for trial. Settlement negotiations with Canada progressed from an initial offer of $65 million to a final global settlement expressed as $87,650,000 [the Chambers Decision's own findings of fact, at para 203, instead describe Canada's accepted settlement offer as $86.5 million; the source does not reconcile these two figures], which included non-monetary benefits such as reserve land, hunting access, and funds for memorialization and feasts, along with a later additional payment of $982,700 for delayed implementation. Before DES issued its final invoice of $5,185,334.21 on April 26, 2021, a separate dispute between the two First Nations over allocation of the settlement funds made Birch Narrows responsible for all outstanding legal fees owed to DES. Birch Narrows disputed and did not pay the final account, leading DES to apply to the Court of King's Bench under sections 64 and 67 of The Legal Professions Act, 1990 to have the fees confirmed or fixed.

Policy and legislative provisions at issue

The application turned on sections 64, 65, and 67 of The Legal Professions Act, 1990. Section 64 permits a member to contract in writing for remuneration on a basis other than fee-for-service and allows an application for a determination of whether such an agreement is fair and reasonable. Section 65 preserves the courts' powers to revise or assess a bill of costs, and section 67 allows a bill of fees to be assessed on application to the court. Rule 11-23 of The King's Bench Rules and the commentary to Rule 3.6-1 of the Code of Professional Conduct for Lawyers of the Law Society of Saskatchewan set out non-exhaustive factors relevant to assessing a lawyer's fees, articulated by the Chambers judge as results achieved, risk undertaken, time expended, complexity of the issues, importance of the litigation, degree of responsibility assumed, quality and skill of counsel, any relevant agreement between lawyer and client, and fees charged in similar cases — factors drawn from Yule v Saskatoon (City), Zipchen v Bainbridge, and McLean v Canada. Section 64(1) also required that any contingency fee agreement be in writing to be enforceable, which was relevant to the parties' dispute over an oral understanding regarding an additional counsel fee.

Reasoning and analysis

The Court of Appeal addressed four grounds of appeal. On the admissibility of the expert evidence of Richard J. Scott, K.C., a former Chief Justice of the Court of Appeal for Manitoba, the panel held that the Chambers judge correctly applied the two-step Mohan and White Burgess framework and did not err in finding Mr. Scott properly qualified, despite his lack of experience specifically in Aboriginal law, since fairness and reasonableness of legal fees does not turn on the area of law involved. On the quantum meruit issue, the panel held that a Yule–Zipchen analysis was appropriate because the Chambers judge had found, without palpable and overriding error, that a second retainer arose when DES took sole carriage of the claim and that this retainer contemplated an additional counsel fee beyond the hourly billings. Regarding the oral agreement to pay a counsel fee, the panel confirmed that while such an agreement was unenforceable as a stand-alone contract under section 64(1) of the LPA, it could still properly be weighed as one of the Yule–Zipchen factors in assessing fairness and reasonableness. Finally, on the quantum of the fee, the panel found the Chambers judge's assessment of each factor — including the risk undertaken by DES, the results achieved, the complexity and importance of the claim, and the degree of skill and responsibility shown by counsel — was well supported by the evidence, and that Birch Narrows had not established any error warranting appellate interference.

Ruling and overall outcome

The Court of Appeal for Saskatchewan dismissed the appeal in full, upholding the Chambers judge's determination that a fair and reasonable counsel fee of $4 million was owed by Birch Narrows Dene Nation to Duboff Edwards Schachter Law Corporation, an amount already reduced from the $5,013,461.18 sought in the originating application. Costs of the appeal were ordered payable by Birch Narrows to DES, calculated on column 4 of the Tariff of Costs, with no costs awarded in relation to Buffalo River Dene Nation, which had taken no position on the appeal.