Earlier in this blog, a new series was introduced that takes a closer look at some of the categories of allegations of serious wrongdoing committed by the defendant lawyers Megan McMahon, Taryn Burnett, and their law firm Gowlings, that resulted in legal action being taken against them.
This is Part 1 in the series and focuses on the defendant lawyers' Fraudulent Misrepresentations and Perpetration of Fraud upon the Court.
This information is contained within the plaintiff's legal brief which can be read here, and the plaintiff's proposed amended statement of claims against the defendants which can be read here.
It is highly significant that the defendants cross-examined the plaintiff's supporting affidavit evidence filed June 5, 2018 for these allegations, and the defendants were unable to dispute this evidence. The defendants were unable to dispute the plaintiff's affidavit evidence because it is undeniable as to the defendants' egregious fraud and fraud upon the court, in addition to their extensive other serious wrongdoing.
The defendant lawyers' fraud and fraud upon the court is largely related to the fraudulent bill of costs prepared by the defendant lawyers in the underlying medical malpractice lawsuit against Dr. Peter Whidden. That underlying lawsuit is still in progress within the channels of the Canadian court system.
First, it will be helpful to review some background in the underlying medical malpractice lawsuit, which the plaintiff brought after suffering injury by Dr. Peter Whidden, causing the plaintiff to undergo multiple corrective surgeries. McMahon and Burnett were the sometimes lawyers for Dr. Peter Whidden in that lawsuit. The plaintiff was successful in defeating the summary judgment application in that medical malpractice matter. The subsequent trial in that matter was adjudicated by Justice Charlene S. Anderson, who made very serious trial errors including that she:
a) unfairly refused the plaintiff her right to rely on her treating physicians’ evidence supporting her medical malpractice claim, including critical treating physicians’ medical evidence specifically stating the injuries the plaintiff suffered resulted from the surgery by Dr. Peter Whidden which caused the plaintiff to undergo multiple corrective surgeries,
b) unfairly refused the plaintiff her right to have trial reasonably scheduled to a date when both of her treating physicians could attend, and instead only allowed one to attend with the requirement that he would have testify the same day he returned to the country without opportunity to prepare, and refusing to allow opportunity for her other treating physician to testify at all,
c) misstated the testimony of Dr. Whidden who was shown to be responsible for the tort of medical battery, among other wrongdoing, and was repeatedly impeached on cross-examination,
e) misstated the evidence of Dr. Whidden's “expert” B.C. Dr. Denis Morris who admitted under cross-examination that his expert report was erroneous and contained hearsay, and;
f) unfairly failed to uphold the self-represented plaintiff’s access to justice rights, among many additional serious trial errors by Justice Charlene Anderson.To be clear, these trial issues are not the subject of the lawsuit against the defendants McMahon, Burnett and Gowlings and are provided here for the purpose of context.
The fraudulent bill of costs prepared by the defendants McMahon, Burnett and Gowlings, among other issues, egregiously claimed costs for applications for which the plaintiff was the successful party, application costs which were reversed in the plaintiff’s favour, costs for applications which the defendant was not awarded any costs, costs for fabricated applications and application dates that do not exist, and duplicated costs items.
The plaintiff requested, both prior to the trial costs hearing in 2014 and prior to the trial costs appeal in 2015, that the defendants provide her with supporting documentation, receipts, and court orders to substantiate their bill of costs. Despite the plaintiff’s requests for this information on multiple occasions the defendants failed to provide it.
The defendants refused to provide the plaintiff the supporting documentation, receipts and orders she requested because the defendants knew that the bill of costs contained egregious fraudulent misrepresentations and could not be supported.
The defendant McMahon’s failure to provide this information resulted in the Court never dealing with the specific costs items that were fraudulently misrepresented in the bill of costs.
At the July 29, 2014 trial costs hearing, the defendant McMahon made further false representations orally with the intent to deceive the Court and procure a fraudulent costs judgment. When the plaintiff said she wanted to respond to the representations of the defendant McMahon, Justice Charlene Anderson refused to allow the plaintiff to respond to them and told her to “sit down”, as shown in the passage below from the July 29, 2014 transcript at p. 23:
22 THE COURT: Okay, sit down, please, Ms. Carbone.Justice Charlene Anderson’s style of adjudication with self-represented people, including in unrelated cases, is clearly a concern. However, this is not the subject in the present action against the defendant McMahon concerning her false statements she made knowing them to be false and knowing that the Court would rely on her statements as an officer of the court, causing the costs judgment to be fraudulently procured. Contrary to the suggestion in the defendants’ brief, a lawyer is not off the hook for fraud because she manages to deceive the court.
23
24 MS. CARBONE: I-- no, I have several --
25
26 THE COURT: Sit down.
27
28 MS. CARBONE: --I have -- I would like to respond to what she
29 said.
30
31 Ruling (Costs)
32
33 THE COURT: Sit down.
The costs decision portion of the July 29, 2014 trial costs transcript shows that Justice Anderson made no ruling on the individual costs, having relied on the egregious and fraudulent misrepresentations of the defendant McMahon as an officer of the court who is expected to act with honesty and integrity before the court.
When the plaintiff again requested from the defendants the supporting documentation, receipts and orders for the bill of costs prior to the costs appeal hearing, on two occasions as shown by the evidence, Gowlings lawyer James Peacock responded in email correspondence dated June 3, 2015, stating: "Further to your email message last week and the two messages from you today, we have no intention of providing this information as it is not relevant to any of the issues under appeal." [Plaintiff Affidavit – June 5, 2018, Exhibit “14”]
As a result of the defendants’ refusal to provide the plaintiff with this information for the appeal hearing, the individual costs items fraudulently claimed were again not dealt with. The appeal decision clearly shows the Court did not deal with the specific costs issues, which is owing to the defendants’ sharp practice in refusing to provide the information.
The costs fraudulently claimed by the defendant McMahon in the June 19, 2014 bill of costs [Plaintiff’s Affidavit – June 5, 2018, Exhibit “12”] include:
a) March 4, 2008 - $1500
The Defendant McMahon claimed this cost despite that the master's order for this amount on this date was later set aside by a subsequent order by a justice upon the Plaintiff’s appeal based on the Defendant Burnett having obtained an order ex-parte before the master and admitting she did not have an affidavit of service for that application and failing to serve the application on the Plaintiff with proper notice resulting in the Plaintiff being unable to attend. The justice's appeal order dated May 9, 2008 in the Plaintiff’s favour specifically states this cost was set aside.
b) April 7, 2008 - $1500
The Defendant McMahon claimed this cost despite that this hearing date before the justice relates to the Plaintiff’s successful appeal before him for the matter referred to in (a) in which the Defendant Burnett obtained an order through her misconduct. This appeal matter was first before the justice on April 7, 2008 at which time he ordered costs will be addressed and upon this appeal matter being finalized before him on May 9, 2008 the justice granted the Plaintiff’s appeal and ordered that the March 4, 2008 order of the master and related costs were set aside.
c) April 21, 2009 - $1500
This costs item is entirely fabricated. No hearing or application occurred on this date and no such costs were awarded.
d) December 11, 2013 - $1500
This costs item is entirely fabricated. No hearing or application occurred on this date and no such costs were awarded.
e) June 3, 2013 - $1500
The Plaintiff was successful on this application in which she was granted leave to file materials on this date. The Defendant McMahon had refused to consent to this remedy in her prior email correspondence, resulting in this unnecessary hearing.
f) August 29, 2013 - $1500
The Defendant McMahon's application for costs forthwith to set a trial date, the purpose of the application on this date, was denied by the Court. A Court does not award a party costs for routine setting of a trial date.
g) October 1, 2013 - $1500
This application was for setting a timetable for exchange of expert reports, routine for a trial. The Defendant McMahon's request for costs was not granted.
h) June 23, 2009 - $2500
Both parties prepared briefs seeking undertakings from the other party. Success was divided and no costs were granted.
i) November 26, 2009 - $2500
On this date, the Plaintiff was successful in, among other relief, obtaining an order compelling the Whidden Defendant to attend for questioning for discovery on the further amendments, which he had repeatedly refused to attend. Costs items related to this application were specifically set out in this order for court reporter sitting fee and discovery attendance, and no costs for this application I was successful on were awarded to the Defendant as the bill of costs falsely claims.
j) February 23, 2010 - $1250
There is no such purported application with a costs award.
k) December 11, 2009 - $800
This costs item is entirely fabricated. No hearing or application occurred on this date and no such costs were awarded.
l) June 17, 18 2013; August 1, 2013 – Summary judgment application the Plaintiff was successful on. Omitted costs of $3750 are payable to the Plaintiff. The Plaintiff was successful in defeating the Whidden summary judgment application, with reasons issued by this Honourable Court on August 1, 2013. The decision shows the Plaintiff was successful on the main issues and that the parties could speak to costs and yet the Defendant McMahon’s bill of costs falsely claimed there were no costs for this application. The parties had not come to agreement on costs by the time of trial and the Defendant McMahon was not at liberty to make up the false statement that there were no costs for this application.
m) Court of Appeal matters - $12,100
No such Court of Appeal costs may be sought in a bill of costs for a Court of Queen's Bench trial, yet the Defendant McMahon even specified double costs for this. Further, the Defendant McMahon included in this category a costs item of $2500 for an appeal restoral matter on January 14, 2010 for which the Plaintiff was the successful party and which a fee of $200, not $2500 to the defendant, was assessed for the restoral fee.
n) The bill of costs duplicates costs items for February 28, 2014, June 23, 2009, and November 26, 2009, again including for applications in which the Plaintiff was successful and for which no costs were awarded to either party.
o) The Defendant McMahon deceitfully mislead the trial judge to believe that the judges presiding for the applications permitted costs for the applications for which no costs were awarded, which is false as the orders stated whether costs were awarded or not.
p) The Defendant McMahon was caught on some of her misrepresentations with the bill of costs items during the trial costs proceeding on July 29, 2014, which reduced the costs judgment by $839.80.
It is also significant that the defendant McMahon was restricted from involvement in the costs issues further to the direction of the Alberta Court of Appeal.
Further details of the defendants' fraudulent conduct can be read in the plaintiff's brief and proposed amended statement of claims, and her affidavit filed June 5, 2018.
Case law supports the plaintiff’s pleadings for the defendants’ defrauding of the plaintiff and fraud upon the Court and makes clear that there are legal consequences for lawyers who commit fraud in the course of litigation and that a lawyer’s position as opposing lawyer does not insulate that lawyer from a claim of fraud and other intentional torts. Binding Supreme Court of Canada law states that fraud and dishonesty vitiate all judgments and that courts have the jurisdiction to vacate an order obtained by fraud, including in another action and, further, that fraud and dishonesty are factors by which related matters may be adjudicated by the court.
Some of this case law relied on is as follows. Additional supporting case law is in the plaintiff's brief.
In Hillier v. Hutchens, 2012 ONSC 5988, the Court stated that a lawyer’s position as opposing lawyer does not insulate that lawyer from a claim of fraud and other intentional torts, and declined to strike the pleadings. The Court ruled:
...absolute privilege usually applies to counsel’s conduct in judicial proceedings…The exception is where malice and bad faith are properly pleaded…Immunity cannot extend to counsel acting in a legal proceeding that was brought to suppress information about a fraud to which that counsel was a party as is alleged in this case. I would, accordingly, not strike these allegations.In the Ontario Court of Appeal decision Lawrence v. Peel Regional Police Force, 2005 CanLII 3934 (ON CA), the Court ruled that pleadings of intentional and malicious conduct by lawyers are arguable and should not be struck:
The appellant pleads intentional and malicious conduct precisely directed at him by the respondent. In my view, those facts are at least arguably capable of implicating the respondent in several intentional torts, including false imprisonment, malicious prosecution, abuse of process, and civil conspiracy. These intentional torts, unlike negligence, are not defeated by the rule that a lawyer owes no duty to the opposing party in litigation...Here, the appellant alleges the malicious commission of intentional torts, a claim that does not depend upon the professional rules of conduct governing lawyers.In another Ontario Court of Appeal decision, Khan v. Krylov & Company LLP, 2017 ONCA 625, the Court allowed a self-represented plaintiff’s appeal and set aside the motion court’s dismissal of his action, which is based in allegations of fraud and dishonesty against law firms, including the defendant law firm which acted as opposing defence counsel in the plaintiff’s underlying motor vehicle accident case. The Ontario Court of Appeal found that the motion court erred in dismissing the case under Rule 2.1 as frivolous, vexatious or otherwise an abuse of the process of the court. The Court further asserted that discernible causes of action must be allowed to proceed and can not be considered frivolous, vexatious or an abuse of process, regardless of how unpleasant a law firm finds allegations against itself. The Court ruled:
In other words, the pleading alleges that the law firms conspired to defraud the appellant. As distasteful as this allegation might be, it is not entirely implausible... Rule 2.1 [similar to a striking application in Alberta] is not meant to be an easily accessible alternative to a pleadings motion, a motion for summary judgment, or a trial...We are unable to conclude that the appellant’s statement of claim asserts a claim that is frivolous, vexatious or an abuse of the court’s process... rule 2.1 is not appropriate as a means for bringing the action to an early end. The motion judge erred in truncating the normal process.The present case against the defendants McMahon, Burnett and Gowlings is similar to the Khan case and should be treated the same. The relevant facts and principles that are similar include:
- In a separate action, the self-represented plaintiff sued opposing defence counsel in the underlying injury case.
- Allegations against opposing defence counsel include fraud and dishonesty by misappropriating monies.
- Pleadings are discernible and plausible, and can not be deemed frivolous, vexatious or abuse of process, regardless of how unpleasant they are for a law firm.
- Well-settled jurisprudence affirms pleadings must be read generously, including for self-represented plaintiffs with actions against opposing counsel.
As ruled by the Supreme Court of Canada in Danyluk v. Ainsworth Technologies, 2001 SCC 44, collateral attack is not made out where issues have not been distinctly put in issue and directly determined or where there are different causes of action, as with the within claims against the defendants McMahon, Burnett and Gowlings. The Supreme Court further affirmed that even if there is collateral attack, which is not present in the within action, the most important factor to consider is potential injustice of not hearing the claims. The Supreme Court stated at paras. 24, 80, and 81:
When a question is litigated, the judgment of the Court is a final determination as between the parties and their privies. Any right, question, or fact distinctly put in issue and directly determined by a Court of competent jurisdiction as a ground of recovery, or as an answer to a claim set up, cannot be re-tried in a subsequent suit between the same parties or their privies, though for a different cause of action. The right, question, or fact, once determined, must, as between them, be taken to be conclusively established so long as the judgment remains.
As a final and most important factor, the Court should stand back and, taking into account the entirety of the circumstances, consider whether application of issue estoppel in the particular case would work an injustice… Whatever the appellant’s various procedural mistakes in this case, the stubborn fact remains that her claim to commissions worth $300,000 has simply never been properly considered and adjudicated. On considering the cumulative effect of the foregoing factors it is my view that the Court in its discretion should refuse to apply issue estoppel in this case.
There may be instances where relitigation will enhance, rather than impeach, the integrity of the judicial system, for example: (1) when the first proceeding is tainted by fraud or dishonesty; (2) when fresh, new evidence, previously unavailable, conclusively impeaches the original results; or (3) when fairness dictates that the original result should not be binding in the new context. This was stated unequivocally by this Court in Danyluk, supra, at para. 80.
In the Supreme Court of Canada decision Landreville v. Town of Boucherville, [1978] 2 S.C.R. 801, the Supreme Court affirmed that fraud, dishonesty and bad faith vitiates and nullifies all judgments, contracts and transactions whatsoever. At p. 814:
Fraud, dishonesty, bad faith, extortion and bribery form a special category of causes of nullity, which transends all others. Fraud unravels everything…once it is proved, it vitiates judgments, contracts and all transactions whatsoever…
