Apr 18, 2016

Conflicted: Disqualification from acting in ICBC Personal Injury Cases | RTL |the goodfirm |

Hanlan v. Wilson, 2016 BCSC 372 (CanLII)

In Hanlan v. Wilson, 2016 BCSC 372, the British Columbia Supreme Court disqualified a lawyer from acting for a plaintiff in an ICBC personal injury case based on a conflict of interest. Mr. Justice MacKenzie’s analysis and application of the test for a conflict of interest in this case is particularly relevant for personal injury lawyers who often meet with couples injured in a car accident.

In Hanlan, Ms. W and her common law spouse, Mr. H, were struck by an unidentified motorist and suffered injuries as a result. The couple retained a lawyer to represent them in their suit against ICBC. The couple met with the lawyer four times to discuss the accident and additionally went to the scene of the accident to gather more information.

As Ms. W was the driver of the vehicle at the time of the accident, Mr. H’s action for damages was to be filed against Ms. W, with ICBC defending on her behalf. Because she was a named defendant in Mr. H’s action, the lawyer advised her that she would have to seek a new lawyer. Ms. W did agree that the lawyer could continue to represent her spouse, Mr. H., and a notice of civil claim was filed on behalf of Mr. H, naming Ms. W and the unidentified driver as defendants. Ms. W, with separate counsel, filed a notice of civil claim naming the unidentified driver and ICBC as defendants.

Defence counsel for ICBC stated that the lawyer for Mr. H was in a conflict of interest and brought an application to prevent the lawyer for continuing to act for Mr. H. Mr. H’s lawyer took the position that he had consent of Ms. W to act for her spouse, Mr. H, and thus there was no conflict.

In finding that the lawyer was disqualified from continuing to act for Mr. H, the court applied the legal frame work for determining whether a conflict of interest exists as set out by the Supreme Court of Canada in MacDonald Estate. The test from MacDonald Estate is whether a reasonably informed person would be satisfied that no use of confidential information would occur. In disqualifying a lawyer, the court must determine whether the lawyer received confidential information from a solicitor client relationship relevant to the matter at hand and whether there is a risk that it will be used to the prejudice of the client.

In applying this test, the Supreme Court places a heavy burden on a lawyer seeking to represent a client in these circumstances, stating that once it can be shown that there existed a previous relationship which is sufficiently related to the matter at hand, the court should infer that confidential information was imparted unless the lawyer satisfies the court that no information was imparted which could be considered relevant.

The lawyer for Mr. H argued against being disqualified on the grounds that he did not obtain any confidential information and that he had received the Ms. W’s consent in continuing to represent Mr. H. He took the position that he had never received any confidential information because he had always interviewed the Mr. H and Ms. W together and never met Ms. W on her own. The court found this did not mean that no confidential information about the accident was obtained.

Although the lawyer had obtained the consent of his former client to represent her spouse, Justice MacKenzie found that public interest in the administration of justice outweighs the Ms. W’s consent in that there would be legitimate concerns about the appearance of impropriety if the lawyer was permitted to pursue a claim against his former client, Ms. W. The court relied on the duty of loyalty owed by lawyers to former and current clients in holding that the confidential trust relationship between a lawyer and a client is considered a fundamental principle and a client has every right to be confident that a solicitor who has been retained will not subsequently take an adversarial position against the client on the same subject matter that they were retained on.

Although the lawyer argued that being disqualified would cause his client significant hardship in finding a new lawyer Justice MacKenzie did not find that difficulty in obtaining new counsel for trial warranted allowing the lawyer to continue to act.

In a tort, an action for damages is brought behalf on an injured party against the tortfeaser. In an ICBC personal injury case where a number of people are injured in the same car, the driver of the vehicle is often named as the tortfeaser, in order to trigger ICBC’s duty to defend the personal injury claim on behalf of the driver. The driver of the vehicle may be a spouse, child or family member of the injured party and they may seek legal advice together. To avoid a conflict of interest, lawyers should be aware when interviewing both or all parties, as the information obtained during the meetings may preclude them from acting for either party as the case progresses.