A British Columbia lawyer has been ordered to pay more than $2.75 million in special costs after encouraging clients to invest in two commercial real estate projects while he and his law firm were insolvent.
B.C. Supreme Court Justice Veronica Jackson issued the ruling on Sept. 3, ordering Lindsay Ross, his wife Joanne Ross, L.A.C. Ross Law Corporation and My Wee World Enterprises Inc. to pay the plaintiffs $2,750,125.28 jointly and severally.
The costs award follows a 50-day trial and earlier rulings in which Jackson found that Ross breached fiduciary duties he owed to his clients. In a December 2024 ruling, she also found that the defendants’ conduct during the litigation was “reprehensible” and warranted special costs.
According to the earlier court findings, Ross had encouraged clients to co-invest with him in a Travelodge Hotel in Sidney, B.C., and a Parkside complex in Victoria. The defendants valued the two real estate projects at more than $10 million.
Jackson previously found that Ross, his wife and his law firm were insolvent when the transactions closed in 2013, but Ross did not disclose those insolvencies or other material information to his clients. He represented that the participants in the projects were “wealthy, financially sound co-investors,” according to the decision.
Jackson also found that Ross structured the investments so that he and his wife received “superior holdings” without his clients’ knowledge.
After the deals closed and the clients learned about the arrangements, Ross gave an explanation involving an escrow agreement that Jackson found did not exist, according to the earlier findings.
Jackson found that Ross used his solicitor-client relationships in a manner that financially benefited himself and his wife. She also found that he did not adequately explain his conflicts of interest or provide his clients with sufficient information to obtain independent legal advice.
“Lawyers owe a duty of loyalty to their clients. This duty of loyalty is essential to the integrity of the administration of justice,” Jackson wrote. “Where the duty of loyalty is betrayed, public confidence suffers.”
Jackson also said Ross’s conduct led his clients to question their own understanding of the transactions he had promoted to them.
Special Costs
In the latest decision, Jackson considered whether she should assess the special costs herself or refer the matter to a court registrar.
The plaintiffs asked Jackson to assess the costs because she had presided over the trial and was familiar with the proceedings. The defendants opposed the request and argued that a registrar should determine the amount.
Jackson concluded that she should assess the costs herself because of her familiarity with the case and the parties’ conduct during the litigation.
She also said a registrar’s assessment could result in further delays because Victoria did not have a full-time associate judge. The court expected the assessment to take about seven days.
The defendants had an opportunity to challenge the reasonableness of the plaintiffs’ legal fees but took no steps to do so, Jackson said. They also did not cross-examine the plaintiffs about evidence concerning the costs.
Jackson said the defendants could prolong the assessment by seeking a detailed review of the legal services and attempting to delay the conclusion of the process.
She pointed to several actions and omissions that delayed the trial and increased the cost of the litigation. For example, the defendants produced some documents years after they should have disclosed them, increasing the time the plaintiffs’ lawyers needed to prepare the case.
Jackson also considered the scale and complexity of the litigation, which included a 50-day trial, a notice of claim exceeding 90 pages, and real estate assets that the defendants valued at more than $10 million.
She found that the plaintiffs’ lawyers billed a reasonable amount of time for handling the case.
Jackson also found that a contingent-fee arrangement between the plaintiffs and their lawyers was fair and reasonable. Under the arrangement, the lawyers billed half their normal rate during the litigation and would receive double that rate if the plaintiffs succeeded.
Jackson awarded the full amount requested in the plaintiffs’ Bill of Special Costs: $2,402,498.74 in legal fees, plus applicable GST and PST, and $59,326.69 in disbursements and GST, for a total of $2,750,125.28.
Jackson said special costs serve a punitive purpose and are intended to censure and deter litigation misconduct rather than simply compensate a successful plaintiff.
English (US) · 
Turkish (TR) · 