Is the Amount of Fees Billed by a Lawyer Protected by Lawyer-Client Privilege? The Latest Twist in the Kalogerakis Case

The issue of whether or not the amount of legal fees incurred by a party is privileged, which seem rather straightforward, has sparked a great deal of debate over the last few years, most recently before the Quebec Court of Appeal in the matter of Kalogerakis v. Commission scolaire des Patriotes¹. 

Factual context and procedural history 

This appeal involved two cases, joined together, that had initially been heard by Quebec’s access to information commission (the “Commission”). 

In the first case, the plaintiff sought to learn the amount of legal fees incurred by the respondent school boards in defending against a class action involving screening measures for dyslexia and teaching methods adapted for students with learning disorders. In the second case, a private citizen wanted to find out the amount of legal fees paid by a municipality in defending against a civil liability lawsuit involving police ethics that he himself had instituted against it. 

Both cases were based on the Act respecting access to Documents Held by Public Bodies and the Protection of Personal Information² and involved situations where the applicant’s request for information was denied on the grounds that the amount of billed legal fees was protected by solicitor-client privilege. 

In 2012 the Commission decided that a lawyer’s accounts for services rendered were part of the solicitor-client relationship and were thus covered by solicitor-client privilege. Its decision was however overturned in May 2014 by the Court of Québec, which held that the solicitor-client privilege did not apply in these instances³. 

However, the matter did not end there, as the applicants applied to the Quebec Superior Court for judicial review of the Court of Québec’s decision. In October 2015 the Superior Court overturned that decision and reinstated the Commission’s decisions to the effect that the amount of professional fees billed by lawyers is covered by professional secrecy⁴. 

The decision and reasoning of the Court of Appeal 

In the latest development in the proceedings, the Quebec Court of Appeal rendered a decision in the matter on August 22, 2017. It overturned the judgment of the Superior Court and reinstated that of the Court of Québec, concluding that the solicitor-client privilege does not apply to the amount of lawyers’ fees. 

The Court stated in its decision that each case is unique and requires an analysis of the facts specific to it. The Court then proceeded to make that analysis using the following two-step test for deciding questions involving professional secrecy: 

1. Determine the scope of the professional secrecy privilege in order to ascertain whether the information sought to be obtained is covered by it. In this regard the Court stressed both the fundamental nature of the privilege as enshrined in Quebec’s Charter of Human Rights and Freedoms⁵, and the Supreme Court of Canada’s decision in Foster Wheeler⁶ to the effect that not every aspect of an attorney-client relationship is necessarily privileged.
2. If the first step indicates that the information is covered by the privilege, determine whether the instant case is one of those rare instances where lifting the privilege and disclosing the otherwise protected information is justified.  

The Court of Appeal’s analysis of the relevant case law and of the previous decisions in this matter makes it easier to understand how four adjudicative bodies managed to arrive at different results in this case. The Court first of all decided that the “correctness” standard of judicial review applied to the decision of the Commission⁷. That being said, what really attracted our attention was the requirement to use a step-by-step approach. The Court stated that the first step consisted of determining what are the elements covered by professional secrecy as it pertains to the presumption of confidentiality associated with the solicitor-client relationship, and not to proceed to the next step of deciding whether there are exceptional aspects of the case that would justify an exemption from the general rule unless those elements are present. The Court pointed out that, to the extent that professional secrecy is not at issue, there is no need to consider the exceptions to the solicitor-client privilege.⁸

While the Court of Appeal’s contextual analysis concerned the application of the professional secrecy of a lawyer to the specific and limited case of the amount of legal fees incurred by a party, it nevertheless remains that the Court’s reasoning will undoubtedly serve as a precedent for several other pending cases⁹. We also note an important distinction in this instance, namely that what was at issue were legal fees paid by public bodies, which are accountable towards those they serve¹⁰. 

Given the number of ruling reversals and the divergent positions of the various levels of adjudicative authority having heard this case, it will be interesting to see whether the parties file an appeal of this latest decision before the Supreme Court of Canada. 

The authors would like to thank the Honourable Paul-Arthur Gendreau, Counsel, for his contribution to the preparation of this article.