Wednesday, July 03, 2013

When $800,000 can't buy you a defence for a $1.2 million fraud claim!

Ontario courts 'only open to the rich'

Judge's ruling describes 'unacceptable failure' of civil justice system with legal fees exhausting defendants' financial resources

By James Bradshaw
Wednesday, July 3, 2013

An Ontario judge has turned a routine decision into a scathing critique of the province's justice system warning courts are increasingly "only open to the rich."

Ontario Superior Court Justice David M. Brown made his pointed commentary in a ruling last week on a preliminary matter in a lawsuit York University launched against former Assistant Vice-President Michael Markicevic, accusing him of masterminding a $1.2 million fraud. The case is a year and a half old, accruing hundreds of thousands of dollars in legal costs, with no trial date in sight.

Justice Brown called the case a prime example of a national prblem that has exasperated some of the country's most senior judges, including Supreme Court of Canada Chief Justice Beverley McLachlin. More and mroe civil defendants, especially those of limited means, face the prospect of legal fees exhausting their financial resources before they even reach a trial.

"One cannot overstate the oppressive effect on judicial morale of the endless waves of cases which seem to be going nowhere in a civil justice system that is sinking." D. M. Brown Ontario Superior Court Justice

"Such a state of affairs reflects an unacceptable failure on the part of our civil justice system," Justice Brown wrote in his June 25 decision.

At the root of the problem is a belief that "trials are bad" and "mediation will solve all problems," which took hold in recent decades and sapped the will to move cases swiftly to trial, Justice Brown said.

"One cannot overstate the oppressive effect on judicial morale of the endless waves of cases which seem to be going nowhere in a civil justice system that is sinking," he wrote. "Why try to be creative when the system with a life of its own grinds relentlessly on and downward?"

Ontario's woes are common in other provinces, especially in larger cities. "It's definitely a national problem," said Melina Buckley, a Vancouver lawyer who chairs the Canadian Bar Association's Committee on Access to Justice.

Canada scores poorly on access to civil justice, ranking ninth out of 16 North American and Western European nations and 13th amoun the world's high-income countries, just ahead of Estonia according to the World Justice Project's Rule of Law Index for 2012-13.

Lengthy legal cases become untenable as defendants remortgage their homes and deplete their savings to pay mounting cousts. Lawyers for Mr. Markicevic, his daughter and her mother (who are co-defendants) bill between $250 and $850 per hour, meaning a 10-day trial with preparation time could coust them $425,000.

Speculating that the defendants' final legal bills might top $800,000, Justice Brown worries they could run out of money before a trial wraps up.

"If we have reached the point where $800,000 cannot buy you a defence to a $1.2 million fraud claim, then we may as sell throw up our collective hands and concede that out publ courts have failed and are now open to the rich," he writes.

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