Newsreal Archives/Critic' Corners

The following article is a matter that we have posted on this site several months ago, wherein Tony Merchant referred to as Merchant-izing Misery, is now being investigated by the BC Law Society.

We would encourage you to read the Globe's article and to know more about Merchant-izing Misery click on:

Merchant-izing Misery

Lawyer fined for 'abusive' act


From Thursday', March 8, 2007, Globe and Mail

One of Canada's most aggressive class-action lawyers is being investigated by the Law Society of British Columbia after a provincial court ordered his law firm to pay $300,000 in damages to a Vancouver Island couple for "outrageous and scandalous" conduct.

Mr. Justice Barry Davies of the Supreme Court of B.C. ordered Merchant Law Group, a Regina-based firm founded by controversial lawyer and former Liberal politician Tony Merchant, to pay the damages because of "duplicitous" actions by him and an associate. The judge found that Mr. Merchant and Earl Shaw, a former lawyer employed by the firm, improperly claimed about $250,000 in fees from injured truck driver Clifford Chudy and his wife, Linda, after they received an $860,000 settlement from insurers in 2002.

The judge's decision included a rare award against a lawyer of $50,000 in punitive damages to "denounce" the conduct of Mr. Merchant and Mr. Shaw as a deterrent against further "abusive action."

Darren Williams, a lawyer for Mr. Merchant, said he plans to appeal the decision.

Spokesman for the Law Society of B.C. said the Supreme Court's decision has "raised enough concerns" to prompt an investigation.

Victor Dietz, president of the Law Society of Saskatchewan, said it is reviewing Mr. Merchant's conduct "with the likelihood that there will be an investigation."

Mr. Merchant began attracting controversy shortly after he began practising law in Saskatchewan in 1968.

The Law Society of Saskatchewan has rebuked, fined or suspended him five times since 1972 for a variety of concerns, including his legal commentaries on radio broadcasts and what they described as misleading solicitation letters to potential clients.

Mr. Merchant has appealed a two-week suspension handed down by the law society last year after he was convicted of unbecoming conduct related to the withdrawal of a client's trust funds.

In recent weeks he has come under fire for a $25-million to $40-million fee payment he stands to receive for representing native survivors of abuse in the federal government's $5-billion residential school settlement.

Last month, a small group of aboriginals staged a protest against the fees outside Mr. Merchant's Regina office.

Mr. Merchant, who grew up in Saskatoon, is also a high-profile political figure in the province. He is a former federal and provincial politician and a leading western backer of former prime minister Jean Chrétien. His wife, Pana Pappas Merchant, was appointed a federal senator in 2002.

"He is a unique book," said Saskatoon lawyer Douglas Richardson, a fellow Liberal supporter who has known Mr. Merchant for more than 20 years.

"There's no doubt about it. There's only one Tony. There's no mould, before or since."

Outside Saskatchewan, Mr. Merchant is known as an aggressive litigator who has launched several high-profile class actions against such embattled companies as Hollinger Inc. and a variety of drug makers.

For the Chudys, the court decision against Mr. Merchant's law firm marks the final leg of a legal and personal odyssey that began in 1995 in northern Alberta, when Mr. Chudy was seriously injured after his tractor trailer hit a bad patch of road and crashed into a ditch.

Initially the Chudys hired Mr. Shaw to represent them in a lawsuit against the province of Alberta for poor road conditions, but the case shifted to Mr. Merchant's firm in 2001 after Mr. Shaw lost his licence, declared bankruptcy and was hired as a paralegal by the Saskatchewan law firm.

After the Chudys received their settlement from insurers in 2002, Judge Davies found that Mr. Shaw and Mr. Merchant breached their duty by "misrepresenting" to the couple that they owed a $230,000 contingency fee to Merchant Law, which had very little involvement in the case.

The Chudys paid the fee, but when they began questioning the payment and asked for their legal file, Mr. Merchant responded by sending a letter demanding a fee of $16,000 for sending the file.

Judge Davies ruled that Mr. Merchant's demand was "a disingenuous attempt to cover up the fact that he did not want the plaintiffs to have the file and he was prepared to go to unethical lengths to avoid delivering it."

Mrs. Chudy said she and her husband are "enormously grateful" for the decision. "It has restored our faith in the justice system." She said she was also discouraged about the legal profession after several other lawyers declined to represent them in their suit against the pair because "they did not want to muddy their hands."

Veteran Vancouver lawyer Irwin Nathanson said he agreed to represent the Chudys because "I thought people should not think that this is how the legal profession performs on behalf of clients. I wanted to show them how lawyers ought to act."