By Aaron Crangle of Crangle Law Professional Corporation. Aaron is a civil litigator in Toronto and is in his 26th year of practice. www.cranglelawfirm.com
Introduction:
As a civil litigation litigator, many of the cases I am involved with include a wide range of complex legal matters, such as breach of contract allegations, shareholder disputes, employment law cases, personal injury matters, and so on. For reasons I have never quite been able to figure out, I also get a lot of calls from people who have civil cases which intersect with criminal law.
Unlike a criminal lawyer who only defends people who are accused of crimes, I do not have to choose sides. Sometimes I act for the Plaintiff (which could be a person or company) who is a victim of a crime, and sometimes I act for the Defendant, who is accused of committing a crime.
In civil law cases which have a criminal law aspect to them, we are usually dealing with the monetary value of an alleged criminal act. Either chasing the money or defending it.
There is a wide variety of cases that I have done, which have a criminal aspect to them.
For example, there are many cases in the civil courts that involve allegations of fraud, such as investment fraud, mortgage fraud, fraud against an employer or business partner and so on. Sometimes I am suing to try to recoup money for the Plaintiff, and other times I am defending the person that is being sued for allegedly committing fraud. Regardless of which side I represent, it is always interesting and challenging.
Other types of cases that I am frequently retained on involve allegations of sexual assault or some other type of personal injury suffered as a result of a crime. I have represented victims of sexual assault by suing both the perpetrator and the company/organization that the perpetrator worked or volunteered with at the time of the alleged act, and I have also defended people who are being sued for sexual assault or other crimes involving personal injury.
In all civil cases, regardless of whether I am representing the Plaintiff or Defendant, the civil lawyer needs to assess both liability and potential damages. In sexual assault cases, there can be a wide range of potential damages based on the circumstances and severity of the case. This is true for any type of personal injury case. If someone has been assaulted and suffered an injury, such as a broken nose which required an operation to fix, then I need to research how much such an injury is worth in terms of damages. The potential damages may differ depending on what the person does for a living, the severity of the damage, their potential loss of income, etc. Personal injury lawyers review case law and damages charts that show the range of damages for certain types of injuries. This chart is crassly referred to as the ”meat chart” by some, but this is the type of research that civil lawyers do to assess the range of potential general damages.
Concurrent Criminal Case
There may or may not be a criminal prosecution going on concurrently with the civil case. When this happens and I am representing a Defendant, I always reach out to the criminal lawyer immediately to discuss the matter, brainstorm about how to best represent the client, offer any assistance or information that I may be able to provide, and keep up to date about the progress of the criminal case.
Sometimes they are being investigated by the police, but have not been charged yet. I always tell my clients not to speak with the police and provide them with the names of criminal lawyers that I trust. I recommend that they pre-emptively contact a criminal lawyer to speak about what they should and should not do.
When I act for a Plaintiff in a civil case where they are the victim in a criminal case, I obtain the investigating police officer and prosecutor’s contact information so that I can communicate with them to keep apprised of what is going on in the criminal case. If there is a conviction, then I order the conviction and sentencing transcripts.
While criminal cases are expected to go to trial within 18 months, it takes much longer in civil cases. Sometimes 5 years or more. It is said that only about 5% of civil cases actually go all the way to trial. The reason for this is probably because it is too expensive, time-consuming and risky to go to trial, so most of the cases settle before.
Use of Criminal Conviction in Civil Case
In Ontario, a criminal conviction is generally admissible in a civil case. The criminal conviction can be used as evidence to prove that a crime was committed, and the underlying facts of the conviction. If someone is convicted of a crime, but they deny committing the act in the civil case, then the civil lawyer can bring a motion for partial summary judgment to establish liability based on the criminal conviction, so the only remaining issue to be determined is damages.
Wagg Motion
In civil cases where there is an underlying criminal case, the Plaintiff’s lawyer will often bring what is called a Wagg Motion to access the documents and information from the criminal prosecution file. The information and witness statements contained therein may be very helpful to the Plaintiff in the civil case.
To obtain a criminal court file for a civil case, the moving party has to provide an Affidavit explaining the reasons for the request, demonstrating the relevance to the civil case and that the public interest in accessing the information outweighs the privacy interests at stake. In every civil case that I have been involved with where there is an underlying criminal case, a Wagg Motion has successfully been brought.
Expert Reports & Financial Risk
In sexual assault or personal injury lawsuits, the civil lawyer will usually retain various experts to deliver Expert Reports to increase the amount of damages. For example, a psychologist or psychiatrist may be retained to interview and assess the victim in order to prepare an Expert Report on how the crime impacted the person, both now and into the future.
A valuator will then be retained to prepare an Expert Report to assess the loss of income that is causally connected to the crime. This loss of income can be valued up to the victim’s expected year of retirement. A victim’s education, career trajectory and future income are often negatively impacted by the trauma that they experienced from being a victim of crime. This may sound like crystal ball gazing, because the valuator will include societal statistics and different scenarios about whether the victim is expected to complete high school or university, and whether they are expected to follow in the career footsteps of their parents, among other things. It may compare what their expected future income would have been had they not been a victim of crime, versus what their expected income will be as a result of the crime.
There will be an income loss calculation done for the rest of the victim’s expected working life. This Income Loss Report is added to the General Damages (which relates to the assault). In addition, there may be a Special Damages report to calculate the out-of-pocket expenses that the victim is expected to incur in the short, medium and long term as a result of the crime. Each case is different, so what type of Expert Reports that are obtained by the lawyer will depend on the case.
Retaining experts in a civil litigation case can be very expensive. Depending on the type of Expert Report that is required, it can cost at least $5,000.00 and up for each Expert Report. The disbursements incurred in the civil case can easily be $20,000.00 or more. Since sexual assault / personal injury cases are often done by the lawyer on contingency, the civil lawyer will usually pay all disbursements incurred in the case from their own pocket. We get reimbursed from out of the settlement or Judgement, but that can take years. Therefore, a civil lawyer needs to carefully consider whether they are willing to take a Plaintiff’s case on contingency. Unlike in criminal law, there are monetary risks to the civil lawyer if they take the case on contingency. If the case goes to trial and you lose, then you will not get paid at all, so the civil lawyer will have to make sure that it is both a strong prima facie case and also a collectible case.
Acting for a Minor
I have represented numerous minors who have been victims of crime. Typically, I will receive a call from a distraught parent who is inquiring about a potential lawsuit on behalf of their child. When acting for a minor under the age of 18, the Rules of Civil Procedure require that there be a Litigation Guardian for the minor. This will usually be a parent. The Litigation Guardian needs to sign an Affidavit confirming that they agree to be the Litigation Guardian, that they authorize me to represent the minor, and that in the event that the lawsuit is not successful, they understand
that the Litigation Guardian will be liable (not the minor) to the Defendant for legal fees, among other things. In civil cases that go to trial, the loser will typically have to pay a portion of the successful party’s legal fees. Therefore, there is a risk to the Litigation Guardian if the case does not settle and goes to trial. The parents may also be Plaintiffs in the civil lawsuit involving the minor, and they may be entitled to some damages under the Family Law Act for loss of guidance, care, companionship and support, as a result of the injury to the minor.
When a case involving a minor is settled, the civil lawyer for the minor is required to bring a Motion for approval of the settlement. In addition, the civil lawyer has to disclose the legal fees that they are charging, which the court has to approve before the lawyer gets paid. An affidavit needs to be filed by the Litigation Guardian to describe the case, the injuries, and the future prognosis of the minor, among other things. A Factum has to be filed to demonstrate to the court that the case was settled for an amount that is within the range of cases of a similar nature.
If the Judge does not agree that the case was settled for a reasonable amount in terms of how much money the minor will receive, then the court will not approve the settlement. This is to protect the minor from greedy or incompetent lawyers and parents. Thankfully, this has never happened to me. However, it can be a bit nerve-racking with respect to getting approval of the legal fees. If the Judge thinks the lawyer charged too much for the amount of work that was done, then the legal fees will be reduced to an amount that the Judge thinks is fair, and the minor will receive more funds. There are cases where the matter settled very quickly, and the Judge reduced the lawyer’s fees because they were considered excessive compared to the amount of work performed. So even if you had an agreement with the Litigation Guardian that clearly set out your fees, if the Judge later considers that unreasonable, your legal fees will be reduced. If you work on a case for years, this is the last thing that you want to happen.
Fraud Cases
When I act on civil files where there are allegations of fraud, I have noticed that in many of my cases, the police seem reluctant to bring criminal charges when the case is over money, even if it involves a lot of money. The line that I have heard over and over again is that when the victim of fraud goes to the police, they are told it is a civil matter, and they should retain a civil litigation lawyer.
I have seen cases of obvious fraud where the police would not lay any criminal charges. In one particular case, where my client was the victim of an investment fraud, he was not willing to accept that answer, so I introduced him to a colleague of mine who is a very good criminal lawyer, and he put a detailed brief together for the police, with tabbed documents attached, in order to make it easier for the police. I assisted the criminal lawyer in terms of explaining the case and providing the documents for him to put together in a way that the police might be more receptive to. In this case, the police did end up laying criminal charges, but if we had not put together the detailed brief for them, they would not have. This result was more satisfying to me
client than the civil case, where I obtained a Judgment for over one million dollars, but was unable to collect on it.
Mareva Injunction
In civil cases, the Plaintiff/victim of fraud will first file a Statement of Claim in a civil court. Before the Defendant is served with the Statement of Claim, the Plaintiff will bring a Motion, without notice, for a Mareva injunction to prevent the dissipation of the Defendant’s assets before trial. This is an extreme remedy for extreme circumstances.
Once the Plaintiff’s lawyer gets the Mareva injunction, the lawyer for the Plaintiff will immediately serve the Order for a Mareva Injunction on all the banks that they are aware of where the Defendant has an account. The Defendant will then be served with the Order freezing their bank accounts and all the court materials.
The Judge granting the Mareva order will typically stipulate that the Defendant is required to deliver an Affidavit listing the details of their worldwide assets within 5 days of being served with the Order. The Affidavit must contain the particulars of the Defendant’s bank accounts, such as the bank account numbers, what type of account it is (eg, sole account, joint account, savings account, chequing account, RRSP, etc.), the location of the bank branch, the balance in each account, etc. The list of assets must also include all other types of assets, such as real estate owned jointly or solely, an interest in a company, and assets held in the name of someone else.
The Order for a Mareva Injunction will also require that the Defendant be produced for cross-examination within a week of serving their Affidavit.
If the provision of any information is likely to incriminate the Defendant, then he may be entitled to refuse to provide it. However, wrongful refusal to provide the information about their worldwide assets is contempt of court and may render the Defendant liable to be imprisoned, fined, or have their assets seized. So that can be obviously tricky for a civil lawyer to navigate. The client has to tell the truth, comply with the disclosure order, but not if it incriminates the client criminally.
I usually receive a panicked call from a Defendant right after they get served with a Mareva injunction. When their bank accounts are frozen, they cannot pay any bills, such as their mortgage, car payments, or most importantly, their legal retainer. The case will return to court within 10 days of the Mareva order to permit the Defendant to bring a Motion to vary the Mareva so that they can pay their ordinary living expenses and legal fees. The Defendant will have to list their ordinary life expenses in an Affidavit to try to convince the court to vary the Order. Often, the lawyer for the Plaintiff will agree to a variation of the Order if they are satisfied that the variation is only being used for ordinary living expenses and legal fees. Judges are well aware that the legal fees for a Defendant in one of these cases will be substantial, and they will typically vary the Order to permit the Defendant’s lawyer to get paid from out of the accounts that are frozen, and for ordinary living expenses of the Defendant.
The Judge granting the Order for an interim Mareva injunction will require that the case come back before the court within 10 days of the Order in order to assess whether the interim Mareva injunction should continue or not. The lawyer for the Defendant may request a Motion to set aside the Mareva injunction if they have grounds to argue that it should not have been granted.
A Mareva injunction is considered a drastic, draconian remedy. The elements of the test for granting a Mareva injunction are well-known. The moving party must:
- Show a strong prima facie case;
- Make full and frank disclosure if the motion is brought without notice.
- Provide particulars of the claim.
- Provide grounds for believing the defendant has assets in the jurisdiction; e) provide grounds for believing there is a real risk of dissipation or removal of funds from the jurisdiction; and
- Undertake to abide by any order for damages if the injunction turns out to have been unwarranted.
See Sibley & Associates LP v. Ross, 2011 ONSC 2951, at paras. 11-12.
Bringing a Motion for a Mareva injunction is not cheap, so the funds at issue must be significant enough to justify the legal fees incurred in bringing such a motion.
Norwich Order
Sometimes an innocent third party may be ordered to produce documents in a civil case that has a criminal element to it. Norwich orders have been frequently granted where a bank is in receipt of funds that were allegedly obtained by fraud. A Norwich order would compel a bank to disclose the Defendant’s bank statements to the Plaintiff in order to trace the funds in dispute.
In the case that gave its name to this type of order, Norwich Pharmacal Co. v. Customs and Excise Commissioners [1974] A.C. 133 (H.L.) at 175, the court stated:
“A person who gets mixed up in the tortious acts of others so as to facilitate their wrongdoing…may incur no personal liability, but he comes under a duty to assist the person who has been wronged by giving him full information and disclosing the identity of the wrongdoers.”
The requirements to obtain a Norwich order for early or pre-action discovery are:
- 1. The plaintiff must have a bona fide claim against an alleged wrongdoer;
- The persons subject to the order must have a connection to the wrong beyond being a Witness;
- The persons subject to the order are the only practical sources of the information needed to prosecute the claim; and
- The balance of convenience favours the seeker of the order, including privacy and confidentiality, public interest, and interests of justice.
Carbone et al. v Boccia et al., 2023 ONSC 3625, at para. 26
A Norwich order can be sought in other types of cases as well, such as an intellectual property case to uncover the identities of infringers and the extent of the infringement, or in cryptocurrency cases to identify the anonymous hackers who stole cryptocurrency, etc.
Anton Pillar Order
An Anton Pillar order is another exceptionally powerful civil court order that is akin to a “civil search warrant” where the Plaintiff is trying to preserve critical evidence from destruction or concealment before trial. It permits a complainant to enter a property to search for and seize evidence, such as records, computers and equipment. This order can be obtained on an ex parte basis as well, whereby the Defendant does not have knowledge beforehand to prevent them from destroying the evidence.
If a Defendant refuses to permit entry in breach of the order, the Plaintiff cannot “force” entry. Rather, the remedy is a contempt of court motion whereby the Plaintiff can seek incarceration due to the contempt.
Anton Pillar orders have been used in a wide variety of cases, such as misappropriation of confidential information by a former employee, cases involving the sale of counterfeit goods, unauthorized use of trademarks, patent infringement matters, misappropriation of trade secrets, etc.
An Anton Pillar order can also be obtained against both parties and innocent non-parties to a litigation.
The requirements for obtaining an Anton Piller order are: (1) there must be an extremely strong prima facie case; (2) the damage, potential or actual, must be very serious for the plaintiff; (3) there must be convincing evidence that the defendant has in his or her possession incriminating documents or objects; and (4) there is a real possibility that the material may be destroyed or secreted before the parties may put their respective rights before the court. See: Bergmanis v. Diamond & Diamond, 2012 ONSC 5762; Celanese Canada Inc. v. Murray Demolition Corp., supra; Bell ExpressVu Limited Partnership v. Rodgers, [2007] O.J. No. 4569 (S.C.J.); Adobe Systems Inc. v. KLJ Computer Solutions Inc., [1999] F.C.J. (F.C.T.D.); Ontario
Realty Corp. v. P. Gabriele & Sons Ltd., (2000), 2000 CanLII 22697 (ON SC), 50 O.R. (3d) 539 (S.C.J.). The requirements to obtain a Norwich order for early or pre-action discovery are:
Due to the highly intrusive nature of all of these types of civil court orders, Plaintiffs can be held liable to pay damages in the event that the order turns out to be unwarranted, excessive or wrongfully executed.
Conclusion
Whether I am acting for a Plaintiff or Defendant, some of the most satisfying, challenging and interesting cases that I have acted on are civil cases that intersect with criminal law. I used to wonder what it would be like to be a criminal lawyer or a Crown Prosecutor; now I get a glimpse into that world. When my cell phone rings and I see it is from a criminal lawyer, I get excited because I am probably going to hear about one of their clients that have been sued. I know it will not be boring.