Judgments

[1994] 1 F.C. 692

T-2116-93

International Business Machines Corporation, IBM Canada Limited and Lexmark International, Inc. (Plaintiffs)

v.

Printech Ribbons Inc., Riyaz Jamal, Karim Jamal and Stalwart Trading Corporation (Defendants)

Indexed as: International Business Machines Corp. v. Printech Ribbons Inc. (T.D.)

Trial Division, Nadon J.—Montréal, November 8; Ottawa, November 26, 1993.

Barristers and Solicitors — Partner in law firm representing plaintiffs signing affidavit filed in record — Whether law firm should be “disqualified” as attorney of record for plaintiffs — Policy on practice: avoid creating impression of impropriety and placing counsel in conflict of interest — Premature to order removal of law firm from entirety of proceedings as not yet certain partner will be required to testify — Upon motion to strike, plaintiffs given choice: change solicitors or file affidavit of another in lieu of partner’s.

In preparation for a trade mark infringement action, Robert A. MacDonald, a partner in the plaintiffs’ law firm, attended the premises of defendant Printech with three other persons. He then filed an affidavit explaining the purpose of the visit and responding to the defendants’ application to strike out paragraphs of the statement of claim. The matters raised in the affidavit were material to the motion to strike. This was an application to “disqualify” the plaintiffs’ law firm as attorney of record for the plaintiffs.

Held, the law firm cannot act in connection with the motion to strike, but the application is premature with respect to the main proceedings.

It is well established that it is improper for counsel to swear affidavits in support of applications which that counsel intends to argue before the Court. The reason is that counsel can avoid cross-examination thereon by invoking solicitor-client privilege.

The dispute here, however, related to whether the law firm could act or continue to act as attorney of record on behalf of the plaintiffs in a case where a lawyer of that firm had sworn an affidavit as to matters relevant to that case. Although the Canadian Bar Association’s Code of Professional Conduct does not permit that practice, the rules of professional conduct of the Law Society of Upper Canada do not prohibit any member of the law firm from appearing as counsel even though evidence from a partner of that firm is before the Court and is relied upon. Nevertheless, the policy in this regard should be as enunciated by Ferguson J. in Heck v. Royal Bank of Canada (1993), 12 O.R. 111 (Gen. Div.): “the practice should generally not be permitted because it may create an impression of impropriety and unfairness in the mind of the public and because it places counsel in an unacceptable conflict of interest where counsel’s duty to the court conflicts with counsel’s duty of loyalty and protection to the witness who is a business associate and counsel’s duty to provide objective advice and representation to the client.”

However, this policy must be tempered by the fact that an order restraining a law firm from representing a client will deprive the client of his fundamental right to the counsel and law firm of his choice. So a motion, brought at an early stage of proceedings, to have an entire law firm removed as counsel of record will not be granted unless the Court is satisfied that the attorney from that firm is certain or very likely to testify.

In the present case, the Court could not, at this stage of the proceedings, order the removal of the law firm from the entirety of the proceedings in this litigation. It was not clear that the attorney’s evidence was relevant or would be relevant to the issues that would have to be determined by the trial judge.

With respect to the motion to strike, since the evidence related to a point of substance relevant to the motion, in order to ensure the independence of counsel, should MacDonald’s evidence be relied upon, the law firm could not be permitted to act at all in connection with it, including on the cross-examination of the affidavits. The plaintiffs were given 15 days to appoint solicitors to represent them for the purpose of the motion to strike or to file an affidavit in lieu of MacDonald’s (three other persons witnessed the events referred to in the affidavit and could swear an affidavit regarding those events).

STATUTES AND REGULATIONS JUDICIALLY CONSIDERED

Trade Marks Act, R.S.C. 1970, c. T-10, s. 56(1).

CASES JUDICIALLY CONSIDERED

APPLIED:

Heck v. Royal Bank of Canada (1993), 12 O.R. (3d) 111; supplementary reasons (1993), 15 O.R. (3d) 127 (Gen. Div.); Brasserie O’Keefe Ltée c. Lauzon, [1988] R.J.Q. 2833 (Sup. Ct.); Carlson v. Loraas Disposal Services Ltd. (1988), 30 C.P.C. (2d) 181; 70 Sask. R. 161 (Q.B.).

CONSIDERED:

Lex Tex Canada Ltd. v. Duratex Inc., [1979] 2 F.C. 722; (1979), 13 C.P.C. 153; 42 C.P.R. (2d) 185 (T.D.); College Marketing and Research Canada (CMRC) Corporation et al. v. Volkswagenwerk Aktiengesellschaft (1980), 53 C.P.R. (2d) 37 (F.C.T.D.); Canada (Director of Investigation and Research) v. Irving Equipment, [1988] 1 F.C. 27; (1986), 39 D.L.R. (4th) 341; 33 C.C.C. (3d) 447; 16 C.P.R. (3d) 26; 27 C.R.R. 78; 8 F.T.R. 107 (T.D.); Planned Insurance Portfolios Co. v. Crown Life Insurance Co. (1989), 68 O.R. (2d) 271; 58 D.L.R. (4th) 106; 36 C.P.C. (2d) 218 (H.C.); Enerchem Ship Management Inc. v. Coastal Canada (The), [1988] 3 F.C. 421; (1988), 83 N.R. 256 (C.A.).

AUTHORS CITED

Canadian Bar Association. Code of Professional Conduct. Ottawa: Canadian Bar Association, 1974.

Law Society of Upper Canada. Professional Conduct Handbook. Toronto: L.S.U.C., January, 1987.

APPLICATION to disqualify law firm as attorney of record for the plaintiffs because a partner had signed an affidavit which the plaintiffs filed in the record. Application allowed with respect to the motion to strike but considered premature with respect to the main proceedings.

COUNSEL:

Robert A. MacDonald for plaintiffs.

Louis Linteau for defendants.

SOLICITORS:

Gowling, Strathy & Henderson, Ottawa, for plaintiffs.

Legault, Longtin, Laurin, Halpin, Montréal, for defendants.

The following are the reasons for order rendered in English by

Nadon J.: This is an application by the defendants Printech Ribbons Inc. (“Printech”), Riyaz Jamal and Karim Jamal (“the defendants”) to “disqualify” Messrs. Gowling, Strathy & Henderson (“the law firm”) as attorneys of record for the plaintiffs.

Specifically, the defendants submit that the law firm should be disqualified because Robert A. MacDonald, a partner in the law firm, signed an affidavit which the plaintiffs filed in the record.

The grounds for the application, as they appear in the defendants’ application, are as follows:

a)   On September 22, 1993, Defendants Printech Ribbons Inc., Riyaz Jamal and Karim Jamal served unto Gowling, Strathy & Henderson a Notice of Motion for Security for Costs, a Notice of Motion for Conditional Appearance and a Notice of Motion to Strike out Allegations, the whole as appears from the Court record;

b)   In reply to these Motions, Mr. Robert A. MacDonald of the firm Gowling, Strathy & Henderson filed, on October 13, 1993, in the Court record, an Affidavit bearing the date of October 12, 1993;

c)   Mr. Robert A. MacDonald is a partner in the law firm of Gowling, Strathy& Henderson, as he so declares in article one of his Affidavit;

d)   Mr. Robert A. MacDonald, in his Affidavit, testifies on facts that relate directly to a material contested aspect this case;

e)   The wilful decision of Gowling, Strathy & Henderson to enter this case as witness disqualifies it to act as attorneys for the Plaintiffs;

In support of their motion to strike, the defendants filed the affidavits of Karim Jamal, a director of defendant Printech, and of Nazir Jetha, the manager for development of new products for defendant Printech. Mr. MacDonald’s affidavit is in response to these affidavits. As appears from the three affidavits, Mr. MacDonald and three other persons attended the premises of defendant Printech on June 29, 1993. At paragraph 5 of his affidavit, Mr. MacDonald explains the purpose of his visit thereat as follows:

5. The Plaintiffs decided to visit Printech, unannounced, on June 29, 1993 to meet with Karim Jamal, one of the principals of the company, to seek assurances that Printech would:

(a)  immediately stop shipping counterfeit IBM® ‘930 printer ribbons;

(b)  permit immediate taking of inventory of all IBM® products on hand and deliver up to any counterfeit products and samples or other IBM® products in inventory;

(c)  permit immediate access to, and duplication of, all documents pertaining to the purchase and sale of all counterfeit IBM® products and all IBM® products that were purchased from the supplier of any counterfeit products;

(d)  cooperate in any investigation and prosecution of those who are selling or offering to sell counterfeit IBM® products; and,

(e)  pay to the Plaintiffs the gross profits earned on the sale of counterfeit IBM products.

Paragraphs 4 to 24 of Mr. MacDonald’s affidavit respond to the defendants’ application to strike out paragraphs 36, 37 and 38 of the plaintiffs’ statement of claim. These paragraphs reply directly to paragraphs 4 through 13 of the motion to strike and the affidavits in support thereof signed by Messrs. Jamal and Jetha.

To put it mildly, Mr. MacDonald’s version of the events of June 29, 1993 is not in agreement with that of Messrs. Jamal and Jetha.

The defendants argue that the matters raised in the affidavits, including that of Mr. MacDonald, are material to the allegations which appear in paragraphs 36, 37 and 38 of the statement of claim, which read as follows:

36. The Plaintiffs have requested that the Defendants cease all use of the IBM trade-marks and the IBM trade dress and such request has been refused.

37. Unless restrained by this Honourable Court, the Defendants threaten to continue the activities complained of herein.

38. By reason of the aforesaid acts of the Defendants, the Plaintiffs have suffered damage and the Defendants have made and continue to make a profit.

Thus, the defendants submit, Mr. MacDonald cannot continue to act as an attorney of record. The defendants further submit that the law firm itself cannot continue to act.

Before I go any further, I wish to make it clear that I have not been seized with the defendants’ motion to strike. Rather, I am being asked to decide whether the law firm can continue to represent the plaintiffs in this case and, in particular, whether the law firm can represent the plaintiffs in connection with the defendants’ application to strike.

The defendants rely primarily on two decisions, namely Heck v. Royal Bank of Canada (1993), 12 O.R. (3d) 111¹ (Gen. Div.)[1] and Brasserie O’Keefe Ltée c. Lauzon, [1988] R.J.Q. 2833 (Sup. Ct.). The defendants also refer to three (3) decisions rendered by this Court, namely Lex Tex Canada Ltd. v. Duratex Inc., [1979] 2 F.C. 722; College Marketing and Research Canada (CMRC) Corporation et al. v. Volkswagenwerk Aktiengesellschaft (1980), 53 C.P.R. (2d) 37 and Canada (Director of Investigation and Research) v. Irving Equipment, [1988] 1 F.C. 27.

In Lex Tex, the defendant filed an application to strike the plaintiff’s statement of claim and in support thereof, the solicitor of record signed an affidavit. The solicitor was cross-examined on his affidavit and “repeatedly refused to answer many of the questions put to him on the grounds of solicitor-and-client privilege.” In view of this, Addy J. rejected the evidence contained in the solicitor’s affidavit. In so doing, Addy J. wrote as follows, at pages 723-724:

The present case illustrates clearly and dramatically the impropriety of having the solicitor of any party to a legal proceeding take an affidavit or testify orally on behalf of his client regarding any cause or issue as to which he has been consulted. The rule has long been recognized by common law courts but of late, seems to have fallen into disuse to some extent, in interlocutory matters in any event, largely because it is so much more convenient for the solicitor to take such affidavits.

Whatever might be the motive for doing so, it is completely improper and unacceptable for a solicitor to take an affidavit even in an interlocutory matter where he attests to matters of substance and might therefore expose himself to being cross-examined on matters covered by solicitor-and-client privilege. In the case at bar, counsel for the defendant quite candidly stated that it was precisely in order to avoid answering questions on certain aspects of the case as to which any other representative of the defendant might be cross-examined, that a decision was made to have the affidavit taken by the solicitor. This, of course, brings into focus all the more clearly the fundamental injustice which might result from the practice.

In College Marketing, Cattanach J. was faced with an application for leave to file a notice of appeal beyond the time prescribed by subsection 56(1) of the Trade Marks Act, R.S.C. 1970, c. T-10. The affidavit of L. C. Cohen, a barrister and solicitor was filed on behalf of the applicant. In addressing the issue before him, Cattanach J. states, at page 40, that:

On the other hand he is the affiant to the allegations in the supporting affidavit. He there describes himself as the president and director of the applicants and then proceeds to swear to matters of substance. If he is acting as the solicitor for the applicants then he is not competent to swear this affidavit. A solicitor is not competent to conduct litigation in which he is a witness.

Cattanach J. then goes on to say that he agrees entirely with the decision rendered by Addy J. in Lex Tex, supra.

In Director of Investigation and Research, Muldoon J. was concerned with a motion for an order of confidential retention of information, with limited access, unless and until a charge be laid against the respondents. The motion was supported by the affidavit of the counsel of record. Muldoon J. began his discussion of the issue by stating that “[t]o purport to be both counsel and witness in one and the same litigious matter is bad practice in this Court and, as well, objectively” (page 33).

Muldoon J. then went on to state that “[t]here are at least three good reasons for rejecting affidavits sworn by solicitors and counsel for a party.” At pages 33 and 34, he wrote as follows:

First, everyone including the speaker has the right and obligation to be perfectly clear about whether he or she speaks as a witness or as a professional adviser. Second is the possibility of conflict with professional responsibility. Affidavits like oral testimony are expressed solemnly upon oath or the legal (if not moral) equivalent thereof. No counsel or solicitor, who is, after all, an officer of the Court, ought even to place himself or herself into the quandary or risking a conflict of interest between remunerative (but yet honourable) advocacy and possibly unpalatable truth sworn on oath. See subsection 11(3) of the Federal Court Act [R.S.C. 1970 (2nd Supp.), c. 10]. No witness can deal objectively with the weight or credibility of his own testimony. Lawyers for opposing parties ought not to be exigible to cross-examination by each other, for fear of sacrifice of one role for the other, or the lamentable appearance of such sacrifice. Third, unless the solicitor or counsel obtain the previous blanket absolution of the client, then he or she will be obliged to assert the client’s solicitor-and-client privilege mentally when formulating the affidavit and, of course, orally only when being cross-examined on it.

Because of special circumstances, Muldoon J. accepted in evidence the affidavit sworn to by the solicitor. However, he concluded that part of his judgment by saying, at page 34:

So be it, on this one occasion only, but never again, without the most compellingly persuasive reasons which can hardly be imagined.

In these three (3) cases, the issue which the Court had to decide was whether the affidavits sworn to by a lawyer could be introduced as evidence in support of the applications before the Court for which that particular lawyer intended to argue. The cases stand for the proposition that save for special circumstances, such affidavits should not be admitted into evidence. In these cases, there may be found no discussion of the issue which is before me, i.e., whether other lawyers of the same firm as the lawyer signing the affidavit can argue the case.

I now turn to Brasserie and Heck which are cases where the precise issue before me has been considered. I begin with Brasserie. At a hearing concerning a labour grievance, an objection to evidence sought to be introduced by the employer was maintained by a labour tribunal. The employer launched a judicial review application, claiming that the labour tribunal had exceeded its jurisdiction when it rejected the employer’s proof. In support of its application, the employer filed a detailed affidavit signed by its attorney of record. This proof was countered by affidavits signed by the three (3) members of the labour tribunal. Prior to the hearing of the judicial review application, the Union applied to the Court for an order rejecting the affidavit signed by the employer’s attorney of record and declaring that neither the said attorney, nor any member of his firm, could continue to act for the employer.

After reviewing the case law and the relevant codes of professional conduct, Tessier J. of the Quebec Superior Court held that the employer’s attorney’s evidence was admissible, but that neither the attorney of record, nor any member of his firm, could continue to represent the client. Tessier J. then stated that the attorney and his firm, should they wish to remain attorneys of record, had no choice but to withdraw the affidavit. Failing the withdrawal of the affidavit, the employer would have to appoint new attorneys. In arriving at this conclusion, Tessier J. emphasized the fact that the affidavit signed by the employer’s attorney dealt with a point of substance. At page 2841, the learned Judge writes as follows:

[translation] The facts reported in the affidavit could not be initially disputed. However, they were subsequently challenged! If Mr. Perron had appeared at the hearing to testify the Court could have checked with counsel for the mis-en-cause whether the possible content of his testimony was in dispute. The answer is now clear: the matter was in dispute. Similarly, the affidavit does not concern a question of form and good evidence is offered to contradict it. Moreover, the applicant found it to contain a basis for challenging the respondent’s jurisdiction.

In support of his decision that neither the attorney nor any other member of his firm could act, the learned Judge found support in the Canadian Bar Association’s Code of Professional Conduct adopted in 1974 [the edition quoted from] and revised in 1987. At chapter 8 thereof, under the title “The Lawyer As Advocate”, commentary no. 3 reads as follows:

3. The lawyer should not submit his own affidavit to or testify before a tribunal in any proceedings in which he appears as advocate, save as permitted by local rules or practice or as to purely formal or uncontroverted matters. This also applies to the lawyer’s partners and associates: generally speaking they should not testify in such proceedings except as to merely formal matters. Nor should the lawyer express his personal opinions or beliefs, or assert as fact anything that is properly subject to legal proof, cross-examination or challenge. He must not make himself in effect an unsworn witness or put his own credibility in issue. If the lawyer is a necessary witness he should testify and the conduct of the case should be entrusted to another lawyer. The lawyer who was a witness in the proceedings should not appear as advocate in any appeal from the decision in those proceedings. There are no restrictions upon the advocate’s right to cross-examine a fellow lawyer, and the lawyer who does appear as a witness should not expect to receive special treatment by reason of his professional status.

This case stands for the proposition that neither the attorney of record nor any member of his firm, should they wish to testify viva voce or by way of affidavit evidence on a point of substance, can act at a hearing or trial where the evidence in question is used or relied upon.

I now turn to Heck. In that case, prior to trial, the likelihood that lawyers from the law firms which represented the plaintiff and the defendant might have to testify at the trial became apparent. This matter was raised before Ferguson J. at a pre-trial conference. Ferguson J. wrote, at page 115:

These potential lawyer witnesses would testify as [sic] the history and as to the reasonableness of the manner in which the bank conducted the mortgage litigation. There will be a serious dispute as to whether the counsel representing the bank conducted the “mortgage actions” with reasonable care and dispatch and in a manner which fulfilled any duty owed by the bank to the plaintiff.

After hearing representations from both sides, Ferguson J. ordered that the attorneys who might be called upon as witnesses, or who were present or former members of the same law firm as the potential lawyer witnesses, should not act as counsel at trial.

In reaching this decision, Ferguson J. reviewed the relevant case law and authorities with respect to evidence to be given by lawyers in a case where they are acting, or where a member of their firm is acting, as attorney of record. Ferguson J. discussed three (3) possible scenarios, namely:

1) where the counsel is to be a witness at the hearing;

2) where the counsel has previously given evidence by swearing an affidavit or by testifying at an earlier stage of the proceeding; and finally

3) where a witness will be called who is a current or former member of the same law firm as counsel.

There is no doubt that the facts of this case closely resemble those of the second scenario. In respect thereto, Ferguson J. stated as follows, at page 118 [as am. by (1993), 15 O.R. (3d) 127, at page 127]:

The cases on this issue are consistently of the view that a lawyer cannot appear as counsel on a motion, at trial or on appeal in a case where he or she has earlier given evidence which is going to be used on that motion, trial or appeal.

There is no dispute between the parties, or at least I believe there is none, that Mr. MacDonald himself cannot act if his evidence is used or will be used. The dispute relates to whether the law firm can act or continue to act on behalf of the plaintiffs under such circumstances.

Mr. Linteau, for the defendants, argued that Mr. MacDonald’s evidence goes to an issue of substance which will not only be relevant at the hearing of the motion to strike, but will be relevant at trial as well. It is Mr. Linteau’s submission that Mr. MacDonald’s evidence goes to the heart of the plaintiffs’ claim that it is entitled to an injunction. Thus, his submission that the law firm must withdraw from the record, or be ordered to withdraw.

Among the cases referred to by Ferguson J. in Heck was the decision of the Ontario High Court in Planned Insurance Portfolios Co. v. Crown Life Insurance Co. (1989), 68 O.R. (2d) 271. In that case, Rosenberg J. allowed the testimony (at trial) of a lawyer associated with the attorney of record’s firm. In the course of his decision, Rosenberg J. commented upon the practice of lawyers appearing at a hearing where their evidence was before the Court and was relied upon. Ferguson J., at page 120, summarized Rosenberg J.’s comments as follows:

1.   He noted that the codes of professional conduct of the Canadian Bar Association and the Law Society are not binding on the court;

2.   He found that the Law Society rules appear to deliberately delete the reference to this practice which is prohibited in the C.B.A. Code.

3.   He observed that it is the practice in Ontario for counsel to appear on motions where their partners have sworn affidavits even on controversial matters;

4.   He noted that the C.B.A. Code specifically states that it is subject to local rules;

5.   He concluded that in his case, the court should defer to the party’s wishes in selecting counsel;

6.   He concluded that his was not a case of possible mischief because there was no conflict of interest on the part of counsel;

7.   This was not a jury trial.

At page 127 of his judgment, Ferguson J. reviewed Rosenberg J.’s comments “to consider what weight should be given when the issue arises before trial.” He reviewed the comments by referring to the paragraph numbers used previously in his summary of Rosenberg J.’s comments. Ferguson J., at page 127, wrote as follows:

1. and 2.—While the Codes are useful as guides they are not determinative because the issue is one for the court to decide in its discretion to control the proceedings before it.

3.—While the practice he notes is commonplace, it is, in my experience, restricted to interlocutory proceedings and is not a common practice at trial. I think that the practice in interlocutory proceedings is distinguishable because the practice on motions is well established, because of the economics of the practice, because the “related” lawyers are giving evidence on interlocutory facts and not the main issues relating to the cause of action and the defence, and because hearing [sic] in such matters are not typically observed by the public and therefore are less likely to create any improper impression in the minds of the public. I believe these are sufficient reasons to consider this practice acceptable as an exception.

4.—I know of no established local rule or practice except in interlocutory proceedings.

5.—I do not think the interest of the client is the paramount consideration especially when the issue is dealt with before trial when it need not affect the conduct or timing of the trial.

6.—I do not think it is the proper test because of the subsequent ruling in MacDonald Estate v. Martin, supra. Further, I believe there is a conflict between the duties owed by counsel to the court as contrasted with those owed to the witness (as a business associate) and to the client.

7.—The presence or absence of a jury could be a significant factor when the issue arises at trial. However, the basic consideration here is the possible impression the practice may have on the public. The public does not consist only of the jury but of the public at large, including everyone in court and the media. The opposite party in the litigation is a member of the public and one can well imagine that party watching a gowned counsel call the counsel’s partner as a witness and thinking “they have the counsel’s partner on their side!” That party and the public might well believe that this would influence the decision of the judge or the jury.

Rosenberg J. commented in Planned Insurance, that it is the practice in Ontario for counsel to appear on motions where their partners (or other members of the firm) have sworn affidavits, even on controversial matters. Ferguson J., while not agreeing entirely with Rosenberg J., stated that such a practice during interlocutory proceedings is “less likely to create an improper impression in the minds of the public. I believe these are sufficient reasons to consider the practice acceptable as an exception.”

Mr. Creber, for the plaintiffs, submits that the law firm should not be removed as solicitors of record for the entire litigation. Mr. Creber also submits that the present case falls within the interlocutory proceedings exception and that therefore the law firm can act on the motion to strike.

In support of his first argument, Mr. Creber submits that the Rules of Professional Conduct of the Law Society of Upper Canada (“the Ontario rules”) do not prohibit any member of the law firm from appearing as counsel even though evidence from a partner of that firm is before the Court and is relied upon. In response to this, Mr. Linteau urges me to look to the Canadian Bar Association’s Code of Professional Conduct which does not permit the practice which the Ontario rules seem to permit. Thus, were I to apply the Ontario rules, any member of the law firm could appear as counsel at the motion to strike and at trial, in the event that Mr. MacDonald’s evidence was relied upon, either by way of affidavit or by viva voce evidence. For the sake of clarity, I quote Rule 10, commentary 16(a), (b), (c) of the Ontario rules which reads as follows:

16. (a) The lawyer who appears as advocate should not submit the lawyer’s own affidavit to the tribunal.

(b) The lawyer who appears as advocate should not testify before the tribunal save as may be permitted by the Rules of Civil Procedure or as to purely formal or uncontroverted matters. Nor should the lawyer express personal opinions or beliefs, or assert as a fact anything that is properly subject to legal proof, cross-examination or challenge. The lawyer must not in effect appear as an unsworn witness or put the lawyer’s own credibility in issue. The lawyer who is a necessary witness should testify and entrust the conduct of the case to another lawyer. The lawyer who was a witness in the proceedings should not appear as advocate in any appeal from the decision in those proceedings. There are no restrictions on the advocate’s right to cross-examine another lawyer, however, and the lawyer who does appear as a witness should not expect to receive special treatment because of professional status.

(c) The requirements of this paragraph are at all times subject to any contrary provisions of the law or the discretion of the tribunal before which the lawyer is appearing.

Commentary 16(c) makes it clear that the Law Society did not intend its Professional Conduct Handbook to be binding upon the Courts, nor could it so intend. The commentary makes it clear that the requirements of the paragraph are subject to “any contrary provisions of the law or the discretion of the tribunal before which the lawyer is appearing”.

On the other hand, Mr. Linteau urges me to accept the policy enunciated by Ferguson J. in Heck, where, at pages 129 and 130, he writes:

I conclude that this practice should generally not be permitted because it may create an impression of impropriety and unfairness in the mind of the public and because it places counsel in an unacceptable conflict of interest where counsel’s duty to the court conflicts with counsel’s duty of loyalty and protection to the witness who is a business associate and counsel’s duty to provide objective advice and representation to the client. When any counsel’s business associate’s skill, judgment, veracity or integrity is challenged that counsel would have difficulty being objective.

Where counsel has a connection to a witness who will testify on issues where factual or expert credibility is at issue there is a risk and a possible perception that counsel may be inappropriately influenced by that relationship to the detriment of counsel’s duties to the court and the client.

The role of counsel of record in our system requires the assumption of an independent position from which the counsel can represent the client with objectivity and fulfil counsel’s duties to the court from a position of detachment. When a counsel calls as a witness a close relative or someone with whom counsel has an employment relationship, the client, the public and the presiding judge will not be assured that counsel will act with that degree of objectivity required by our adversary system.

This is not an issue which should turn on the wishes of the client or the witness because their acceptance of the practice could not eliminate the conflict with the duty of counsel to the court and could not eliminate any appearance of impropriety in the eyes of the public.

Indeed, I am doubtful that counsel could properly advise a client as to whether it should consent to counsel’s calling a business associate as a witness. Could counsel be relied upon to give an objective assessment of that witness’s evidence and of the impact of such a step on the court and the public? Would counsel not be susceptible to being influenced by the risk that the counsel would be removed from the case, and even perhaps lose future business from that client, if the client decides it did not want counsel to act?

It is of great value to the court to have independent counsel. When a party appears in person or a counsel becomes emotionally involved because he or she identifies too closely with a party or a witness, the party and counsel tend to “enter the fray” and make it difficult for the court to conduct its process and to receive the assistance it expects from counsel or officers of the court.

Notwithstanding the Ontario rules, I believe that the policy as enunciated by Ferguson J. should be followed by this Court even where Ontario lawyers are involved.

However, this policy must be, in my view, tempered by the fact that an order restraining a law firm from representing a client will deprive the client of his fundamental right to the counsel (hence the law firm) of his choice. I thereby adopt Marceau J.A.’s dissenting judgment in Enerchem Ship Management Inc. v. Coastal Canada (The), [1988] 3 F.C. 421 (C.A.). In that case before the Federal Court of Appeal, the plaintiffs were seeking an order from the Court restraining a law firm from acting on behalf of the defendants on the ground of confidentiality. Although this is not the issue before me, the following words of Marceau J.A., at page 428, are nonetheless appropriate:

What the motion asks is clear and simple. It invites the Court to use its control over its proceedings and refuse to allow Campbell, Godfrey & Lewtas to represent the respondents in the action because the proper administration of justice would be jeopardized by their participation. The exceptional gravity of the motion, when reduced to its most simple terms, is striking. The Court is called upon to intervene and deny, not only the normal right of a party to retain the solicitor of its choice, but also the right of a lawyer to practice his profession and carry on his business as he sees fit (so long, of course, as he does it honestly and according to the rules), on the sole basis that the proper administration of justice requires that it be so. I suppose it need not be emphasized that for a motion of this gravity to succeed, the grounds alleged in support thereof must be serious indeed.

In my view, the grounds alleged by an applicant who is seeking, at an early stage in the proceedings, to have an entire law firm removed as counsel of record will not be “serious” unless the Court is satisfied that the attorney from that firm is certain to testify or is very likely to testify. Failing that, it is my view that such an application should not be granted.

In the present case, the issue has arisen at a very early stage of the proceedings. No defence has yet been filed and no discoveries have yet been conducted. In Carlson v. Loraas Disposal Services Ltd. (1988), 30 C.P.C. (2d) 181, the Saskatchewan Court of Queen’s Bench faced a similar situation. The plaintiff, after filing its defence but prior to examinations on discovery, applied to the Court for an order removing the defendant’s attorneys as solicitors of record by reason of the fact that a member of the law firm representing the defendant “will in all likelihood be a required witness”, thus contravening By-law No. 4 of the Law Society of Saskatchewan. Walker J. refused to make the order sought by the plaintiff on the ground that it was premature. Walker J. writes, at page 186 that:

This is the rule as it is sought to be applied to this application:

“The lawyer should not … testify before a tribunal in any proceedings in which he appears as advocate …. This also applies to the lawyer’s partners and associates: generally speaking, they should not testify in such proceedings.

If the lawyer is a necessary witness, he should testify, and the conduct of the case should be entrusted to another lawyer.

The words at the heart are “testify before a tribunal, in any proceeding”, “appears as advocate” and “a necessary witness”. It is testimony which triggers the problem. It is “advocacy” and its nature and extent upon which the applicant relies in particular.

The point at which the rule is to be applied is of the essence. If the order is granted early on, as requested here, the respondent may, regardless of how the matter develops and the necessity for the order, be, once and for all, deprived of a basic right of counsel of his choice. It may develop not to have been necessary but it will have been done. If the order is not granted early on, there is time and opportunity, if the situation develops as to require it, for the applicant to apply again in the clearer circumstances, with the applicant’s cost a special consideration, or the law firm to withdraw (1) voluntarily or (2) on the request of the respondent. This is not to say that there will not be cases in which, at an early point, the consideration of “necessary witness”, as in the rule, will lead to an order early on. Nonetheless, timing may be of the essence.

Walker J. then goes on to write, at pages 189-190 that:

This is one of those rare cases where a Court is asked to rule on professional conduct in order to exercise due control over its own process. I would not like to see too wide a door opened to applications of this sort at this stage in an action. One limitation which I see involves a consideration of the stage at which the action has arrived and the extent to which, without unfairness to the applicant, it might be dealt with at a later point when the status of the advocate and potential witness as a witness has become clearer, with costs very much in mind. Will there be, eventually, a breach of the rule? Many authorities see the trial Judge as the one to deal with the problem as opposed to dealing in advance on a motion for restraint on the law firm. There may be something to be said for that approach. Be that as it may, in this jurisdiction authorities have found jurisdiction for such an application and I am content to follow them, notwithstanding the cases seem few which have vested a discretion in the trial Judge or Court to oblige the lawyer to elect in advance his role as counsel or witness.

Walker J. goes on to state that many of the authorities are to the effect that such an issue should be dealt with by the trial judge. I agree with that view unless, as I have stated before, it can be demonstrated to the satisfaction of the Court, prior to the trial, that the attorney or attorneys will certainly or in all likelihood testify at the trial.

I am therefore of the view that I cannot, at this stage of the proceedings, make the order requested by the defendants, i.e., to remove the law firm from the entirety of the proceedings in this litigation. In any event, it is not clear to me that Mr. MacDonald’s evidence is relevant or will be relevant to the issues that will have to be determined by the trial judge.

This does not however, resolve the problem in so far as it relates to the motion to strike. As the matter now stands, Mr. MacDonald’s affidavit is before the Court and will no doubt be relied upon by the plaintiffs in defending the defendants’ motion to strike.

Whether the issue arises at trial, or shortly before trial as in Heck, or at a preliminary stage in the proceedings, as in the case at bar is, in my view, irrelevant. In all instances, the independence of counsel is paramount. Exceptions should not lightly be permitted.

In the present case, Mr. MacDonald was one of four people who could have sworn an affidavit regarding the events of June 29, 1993. Thus, in the circumstances of this case, Mr. MacDonald’s evidence was not necessary. His evidence relates to a point of substance relevant to the motion to strike and thus, in order to ensure the independence of counsel, the law firm cannot be permitted to act at all in connection with the motion to strike, including on the cross-examination of the affidavits.

In view of my decision that the law firm cannot act in connection with the motion to strike should Mr. MacDonald’s evidence be relied upon, I shall allow the plaintiffs fifteen (15) days from the date of this decision to:

(a) appoint solicitors to represent them for the purpose of the motion to strike; or

(b) file an affidavit in lieu of that of Mr. MacDonald’s.

Costs shall be in favour of the defendants in any event.

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