BarTalk February 2003
Volume 15, Number 1

BarTalk Vol. 14/No. 5 “What’s the right course in the Wirick case?”

I think it is unrealistic and unwise to implement any program that would entail unrestricted underwriting of lawyer’s undertakings.

The response of the legal profession to the Wirick matter must provide for protection of the public, while being prudent and fair to the legal profession.

We as lawyers have not in the past “stood behind” undertakings of lawyers, except insofar as a breach of an undertaking might consist of a misappropriation or wrongful conversion of trust funds, thereby attracting possible application of the special compensation fund of the Law Society. I think if we are to go further than that, it must be through a carefully considered and properly administered form of fidelity insurance. We cannot ask the legal profession to accept unlimited liability for undertakings. No reasonable person would do it. Even extremely rich people who subscribe to be “Lloyd’s names” face unlimited liability which is based upon carefully evaluated risks. And the financial rewards to the Lloyd’s investor is perceived by the investor to warrant the risk.

If I deposit money in the bank, I should be able to trust that the banker is not a thief and will not steal my money. Yet there is an insurance limit of only $60,000 pursuant to the Canada Deposit Insurance Corporation. There are limitations on the insurance. I think if one were to ask the directors of the Royal Bank whether they would be prepared to do away with that program, and provide an indemnity for all deposits at all Canadian banks, they would consider that proposal ludicrous.

The losses in the present case may be in the range of $20 to $40 million. What if, in a future case, the losses were 10 times bigger, or 100 times bigger?

It would be unfair to ask the legal profession as a whole to pay for, or to be liable for, insuring the “sanctity” of undertakings, when those undertakings are of primary importance to a segment of the legal profession only.

I think the only thing that makes sense is a transaction-based fidelity insurance program. Premiums would be payable in relation to the size of the transactions involved. The premium should be paid for by the lawyer engaged in the transaction, out of fees, and should not be allowed to be shown as a disbursement on the bill. The public is rightly offended by any scheme which would ask the public to pay for lawyer’s fidelity insurance. Given the rarity of these problems, I would expect that in time the premiums necessary would become very small. The program might be administered by the Law Society, as is currently done with our professional liability insurance.

Yours truly,
Frits Verhoeven

BarTalk Vol. 14/No. 6 “Tired of the Legal Aid Issue”

Racing to the end of the year I took a moment to review the BarTalk editorial on legal aid. After reading it I decided to take another moment to acknowledge its excellence.

Like most regular BarTalk readers I have come to expect good writing and a considered message in the editorials. The recent article surpasses that standard, providing a concise overview of many current issues relating to legal aid. It does so with a voice that accurately reflects the sentiments of the many lawyers who have been involved in the struggle to ensure people in B.C. have access to the legal services they require to protect their rights and resolve their legal problems.

Legal aid will survive in B.C. only with the ongoing involvement and commitment of the Bar and will prosper only if it has support in the broader community. The CBA’s commitment to preserving legal aid and advancing the debates around it are important to many and invaluable to the justice system itself. My thanks to all of you for engaging with this issue yet again.

Sincerely,
Mark Benton, Executive Director
Legal Services Society

BarTalk Vol. 14/No. 6 “So, what does CBABC do for members?”

I read with interest your article entitled “So, what does CBABC do for members?”

Over the years, I have been frustrated by people who suggested that the CBA does nothing for them. One thing that was not on your list of what the CBA does for its members, is a project that I have been involved with as the CBA’s representative for the last six years. It probably has touched the life of every CBA member, be it in a small way.

The BC Real Estate Association’s Standard Forms Committee (the “Committee”) is the group that has developed the standard form Contract of Purchase and Sale (the “Contract”) used in over 90 per cent of residential real estate transactions in British Columbia. As you know, the Contract is jointly copyrighted by the B.C. Real Estate Association and the CBA. Since 1986, the CBA has had a representative on the Committee, which drafted and revised the terms of the Contract. I have been that representative since 1996. For the 10 years before that, the CBA’s representative was Jane Purdie, QC.

The development of the Contract allows for efficient conveyancing practices. Once lawyers and paralegals have determined that they are dealing with the Contract, they need not to review the standard terms in detail, as it will only include terms that they are familiar with. Before the Contract was developed, every Real Estate Board and many real estate firms used their own form of contract of purchase and sale. This meant lawyers had to spend additional time reviewing “standard boilerplate.”

The Contract also benefits lawyers who never practise real estate law. Most lawyers will use the Contract when buying or selling their own home, whether they use the service of a realtor or not. The Contract makes for easier negotiation of deals, as parties generally feel more comfortable using a standard form document, and helps keep everyone’s conveyancing costs down.

Over the years, the Contract has been amended to address numerous issues that have arisen, including changes to reflect new conveyancing practices resulting from judicial decisions, changes to statutes and Land Title Office practices.

In addition, in my role as a member of the Committee and Past Chair of the Real Property Section, I developed the “CBA Standard Undertakings” which are incorporated by reference in the Contract. I spent many tens of hours drafting, circulating, and then seeking input on those undertakings. Those undertakings are being currently revised to address issues that arose from the Wirick/Gill matter. I am again involved in that process, spending many unpaid hours that will hopefully reduce the potential of a future Wirick/Gill affair.

This may be a small item but it is something that probably has touched the professional and private lives of more lawyers than any other service of the CBA. Over the years I have spent well over 200 hours on the Committee’s work. I think it is work that has served the profession and the public at large, well. I hope to see it on a future list.

Yours very truly,
Edward L. Wilson

These letters were published in the February 2003 issue of BarTalk.