Motion to dismiss denied as claims not frivolous, vexatious or abuse of process

Plaintiff client was represented by defendant law firm K Co. in his claim for damages arising from motor vehicle accident (MVA). Defendant law firm D LLP represented other party in MVA action. Client settled MVA action for much less than his lawyer had assured him he would get. Client brought action against both law firms on basis that law firms misappropriated funds to provide client with smaller settlement. Motion judge granted law firms’ motion and dismissed action under R. 2.1.01 of Rules of Civil Procedure as being frivolous, vexatious or abuse of process. Judge found that statement of claim provided no particulars of breaches of fiduciary duty, negligence, fraud, misappropriation and dishonesty. Client appealed. Appeal allowed. Pleading alleged that law firms conspired to defraud client, which was distasteful but not entirely implausible. Rule 2.1 of Rules was reserved for clearest of cases. There was nothing on face of statement of claim that showed client to be vexatious litigant. There was no suggestion that client would abuse process of court. Law firms’ motion was premature. Statement of claim did not assert claim that was frivolous, vexatious or abuse of court’s process.

Khan v. Krylov & Company LLP (2017), 2017 CarswellOnt 16235, 2017 ONCA 625, S.E. Pepall J.A., P. Lauwers J.A., and Grant Huscroft J.A. (Ont. C.A.).