The B.C Court of Appeal in Vancouver, British ColumbiaBen Nelms/The Globe and Mail
A B.C. lawyer who employed a convicted murderer on parole to help with the paperwork for abused former residents of Indian residential schools seeking government compensation has avoided being sanctioned for professional misconduct.
Justice Brenda Brown chose not to remove Stephen Bronstein of Vancouver and his firm from the Independent Assessment Process through which individuals make claims for residential-school compensation because that could disrupt the process for more than 150 clients with outstanding applications.
Mr. Bronstein had dismissed complaints from clients that his employee Ivon Johnny was demanding money from them, according to a B.C. Supreme Court ruling released this week. The decision also addressed concerns Mr. Bronstein was lending some clients money in violation of federal law and the rules of residential schools compensation agreements.
"The evidence leads me to the conclusion that Mr. Bronstein has failed to meet the standards expected of a legal professional owing fiduciary duties to his or her clients," the justice wrote.
"However, the issue is not whether Bronstein's conduct was improper and blameworthy. It was. The issue is whether its conduct was so improper that it is necessary to remove it from participation in the [Independent Assessment Process]."
She has concluded it was not.
Mr. Bronstein and his firm are now on the right track in managing these files, Justice Brown wrote in a ruling that caps a two-year investigation by a court-appointed monitor.
"However, this is no exoneration of Bronstein," Justice Brown writes, noting that the legal firm would not have reached "acceptable standards" without intervention.
The justice ordered Mr. Bronstein to pay "reasonable costs" associated with the investigation into the matter by the court monitor.
The key issue addressed in the ruling was the professional relationship between Mr. Bronstein and Mr. Johnny, who worked at helping to process claims after his own claim was resolved. From 2008 until 2012, Mr. Bronstein paid Mr. Johnny about $180,000 for his work. However, there were various complaints that Mr. Johnny was demanding money from clients. Throughout, Mr. Bronstein was, according to the ruling, skeptical about the claims.
In 2012, Mr. Johnny was arrested and imprisoned for his conduct with clients and his parole was eventually revoked, the ruling says. In 2013, Mr. Bronstein agreed to facilitate an investigation into his practice and to submit to a review, says the ruling, which notes that the court has barred Mr. Johnny from further participation in the claims process.
Another issue was Mr. Bronstein's practice of extending clients loans secured against their compensation awards. Between 2009 and 2011, according to the ruling, he extended $212,250 in loans, largely in the range of $1,000 to $2,000.
Mr. Bronstein did not charge interest, but did, on three occasions, charge a $50 administration fee. "In Mr. Bronstein's view, he provided these loans to help his clients," Justice Brown wrote.
There were also allegations addressed in the ruling Mr. Bronstein was working with third-party lender Fargo Bond Inc., which provided loans to four of his clients, but Mr. Bronstein denied any arrangement.
Since September, 2014, more than 100 files have been brought to settlement-claim hearings "and the evidence regarding the remaining files suggests they are progressing as well," the justice wrote.
"The court cannot deny that Bronstein has revised its practice and that this has likely resulted in beneficial effects for its clients."
Mr. Bronstein and his lawyers did not respond, by deadline, to calls and e-mails from The Globe and Mail seeking comment on the ruling.