Citation: 2022 SKQB 158  
2022 06 30  
QBG 692 of 2018  
Judicial Centre: Saskatoon  
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Nicholas P. Conlon  
for the plaintiffs  
Randall M. Sandbeck, Q.C., and Elaine N. Selensky  
for the defendants  
June 30, 2022  
This matter involves competing summary judgment motions being heard  
In 1984, George Leffler and Gwen Leffler, collectively [Lefflers], began  
a landscaping and excavating business that would come to be known as Leffler  
Excavating Ltd. [Leffler Excavating]. Aaron Behiel [Behiel] represented the Lefflers  
in drafting a contract to formalize their negotiated sale of Leffler Excavating, which  
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included $300,000 in vendor financing. Issues arose with the repayment of the  
vendor-financed portion of the sale. Litigation was commenced to assist the Lefflers in  
realizing these payments; however, this was ultimately discontinued.  
The Lefflers now seek to recover the unrealized payments from Behiel,  
through allegations that he did not meet the standard of a reasonably competent lawyer.  
Behiel requests that the Lefflers’ claim against him be dismissed.  
For the reasons that follow, I conclude there is no genuine issue for trial  
and the evidentiary record allows me to achieve a fair and just determination on the  
merits of these competing summary judgment applications. I conclude that the Lefflers’  
application for summary judgment must be granted.  
1. The Negotiations  
In early 2014, the Lefflers began discussions with Cory Buckle [Buckle]  
to sell Leffler Excavating, and the parties agreed to a price of $1,000,000. Although the  
Lefflers thought this may be a low valuation, they decided to accept the offer. Buckle  
also introduced the Lefflers to Heath MacDonald [MacDonald]. The purchaser would  
be a separate company, Stony Lake Construction Ltd. [Stony Lake]. The Lefflers  
believed Buckle and MacDonald owned and operated Stony Lake. A draft agreement  
for the sale of assets was prepared by counsel for Stony Lake, Michael Hall [Hall].  
In May 2014, the Lefflers retained Behiel to assist in the sale of Leffler  
Excavating to Stony Lake. The Lefflers were familiar with Behiel as he had acted as  
their legal counsel previously, including estate planning and corporate matters. No  
formal retainer agreement was entered into.  
Behiel’s evidence is that in May 2014, he was contacted by George  
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Leffler and his accountant, Bill Riach [Riach] to assist with the sale of Leffler  
Excavating. George Leffler was consulting with Riach on the format of the sale. Behiel  
was not involved in the negotiations that took place between George Leffler and Buckle  
prior to May 6, 2014. However, Riach sent an email to Behiel on May 6, 2014, which  
confirms the Lefflerssecurity in the sale was still to be determined.  
Behiel avers at paragraph 8 of his affidavit sworn July 13, 2020 [Behiel  
Affidavit], that he was retained by the Lefflers to close the transaction but was “neither  
asked to nor retained to provide any legal services in relation to business decisions, nor  
to conduct any diligence searches in relation to the purchaser.”  
Buckle and the Lefflers continued to negotiate between themselves and  
engage the services of their accountants and lawyers as details of the transaction began  
to crystallize. It does not appear the Lefflers ever had any conversation with MacDonald  
about his perceptions of or input into the transaction; Buckle was their sole point of  
From the outset of these negotiations, it is apparent there was a need for  
the Lefflers to provide vendor financing of a portion of the purchase price. The  
arrangement was that Wells Fargo would finance $700,000 of the purchase price with  
the Lefflers financing the remaining $300,000. In his affidavit sworn June 3, 2020  
[Leffler Affidavit], George Leffler deposes that they raised concerns about the security  
of this vendor-financed portion with Behiel from the outset. The Lefflers suggest it was  
an immediate concern as Buckle initially stated he would pay the entire purchase price  
up front, and then later advised he would require vendor financing.  
It is uncontroverted that the Lefflers were concerned that the agreement  
needed to be structured to protect their interests and, particularly, their ability to collect  
the $300,000 they were financing.  
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Behiel avers that he explained the inherent risks of vendor financing to  
the Lefflers, including a suggestion to charge a higher interest rate to compensate for  
this risk. He also deposes that he recommended obtaining some sort of security. Behiel  
recalls discussing the different types of security that could be taken, such as guarantees  
or registering a security interest.  
On June 3, 2014, Wayne Paproski [Paproski], an accountant with MNP,  
copied Behiel on an email to the Lefflers regarding a corporate reorganization that was  
to occur prior to the close of the equipment transaction which effectively changed the  
nature of the sale from assets to shares. Behiel was not engaged to provide any legal  
advice to the Lefflers on Paproski’s proposed restructuring.  
It is clear the nature of the sale assets or shares was being determined  
between the Lefflers and their accountants without input from Behiel. While Behiel was  
attempting to reach an agreement with Hall, the Lefflers were receiving advice from  
other professionals in the background with respect to the nature of this transaction. For  
example, Paproski’s email of June 6, 2014, outlined the discussions occurring regarding  
the nature of the transaction with corresponding adjustments to the purchase details  
being requested based on accounting and tax advice.  
However, the intention between the Lefflers and the professionals they  
engaged remains the same: to structure the sale in the most beneficial manner to the  
Lefflers and to protect their interests. This was clearly set out in the email from Riach  
to Behiel on June 6, 2014, where Riach states:  
I had met with the lefflers and the buckles at my office in may - after  
which I’d sent you a note.  
The only deal we talked about was a share sale at that time and I do  
believe I had mentioned buckle should speak with his accountant  
about further tax planning on this.  
An appraisal was done at buckles request and the sale price came down  
and turned into an asset sale. George had mentioned buckle couldn’t  
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get financing for a share purchase and I had mnp wayne - forward  
information on how to accommodate this with little issue on buckles  
end and allow george better tax planning, a reasonable request given  
his already lowered price.  
The agreement referred to below was what buckle had drawn up, that  
is why you get to review it - to make sure george’s interests are looked  
after. [Emphasis added]  
[Behiel Affidavit, Exhibit 16]  
It is uncontroverted that on June 6, 2014, Behiel advised Hall that the  
Lefflers had the following conditions for the sale:  
I met with the Lefflers yesterday and for the most part they are good  
with the terms of the proposed sale on two conditions:  
1) The deal has to proceed as MNP has proposed or alternatively  
if only going to be an asset sale then they will need a greater  
sale price.  
2) They will want interest on the $300,000 being carried. It  
would subject to prime plus 5%, with annual interest  
3) They will want promissory notes of the shareholders of  
Stoney [sic] Lake.  
[Behiel Affidavit, Exhibit 13]  
[Leffler Affidavit, Exhibit 21]  
Hall’s response of June 6, 2014, suggests these revisions were being  
made well into the negotiations between the parties.  
I will forward your message to my client however:  
a) It is getting late in the fame for your client to change the deal by  
proposing only the MNP deal or a price increase. Your client  
should have had this figured out long ago;  
b) I don’t believe interest was part of the agreement;  
c) I don’t believe guarantees were part of the agreement.  
I will advise once my client has determined the tax consequences of  
the proposal by MNP.  
[Behiel Affidavit, Exhibit 13]  
[Leffler Affidavit, Exhibit 21]  
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Shortly after these conditions were proposed, Buckle visited the Lefflers  
to advise he was not proceeding with the purchase of Leffler Excavating. It appears that  
introducing issues of interest rates and promissory notes or guarantees were not  
contemplated or welcomed by Buckle; it is unclear whether MacDonald was ever made  
aware of this request, but there is no evidence that he ever discussed the equipment sale  
or the agreement terms with the Lefflers.  
On June 9, 2014, Hall notified Behiel that the parties did not have an  
agreement on the structure of this transaction. On June 10, 2014, Paproski notified  
Behiel that Buckle had called off the transaction and was pursuing other opportunities.  
On June 11, 2014, George Leffler contacted Behiel to advise that Buckle  
said the “deal is back on”. Behiel’s notes confirm he was advised that Buckle agreed to  
interest at prime plus 5% and to a “guarantee of shareholder”.  
On June 11, 2014, Behiel notified Riach and Paproski that the transaction  
was going ahead, that Buckle agreed to the terms the Lefflers had set out and that the  
parties wanted the transaction done quickly as Buckle was taking over Leffler  
Excavating’s work as of that Friday.  
On June 12, 2014, Behiel provided Hall with a “very draft” share sale  
agreement, which he acknowledged was put together quickly as the transaction was  
going ahead, in some way, the next day.  
Apparently, by this time, Buckle was using Leffler Excavating’s  
equipment to provide his own excavating services. Buckle was running the equipment  
and using it to make profit with the input costs largely being paid by Leffler Excavating.  
In fact, despite Leffler Excavating continuing to own the equipment, the invoices were  
not being sent out in their name; rather, Buckle was invoicing clients independent of  
Leffler Excavating.  
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Despite the parties wanting this transaction to finalize, there were delays  
with the substantive financing by Wells Fargo, who had not yet provided financing  
instructions. By July 25, 2014, Hall had not yet received financing instructions from  
Wells Fargo. Subsequent correspondence of July 28, 2014, confirmed that Wells Fargo  
was taking a security interest in the equipment.  
To complicate things further, the Lefflers contacted Behiel on July 28,  
2014, advising there had been a “shakeup on Friday” as “Cory [Buckle] has all  
equipment locked in compound”. While George Leffler recalls this event differently, I  
prefer the evidence of Behiel as recorded in his notes as this is the best record of what  
was communicated to Behiel on that date.  
2. The Agreement  
The Lefflers signed the Share Sale Agreement on August 8, 2014  
[Agreement]. The parties to the Agreement included Stony Lake (as the purchaser),  
Leffler Excavating, 101228286 Saskatchewan Ltd. (as the corporation who held the  
shares in Leffler Excavating) and the Lefflers who were individually named as “Vendor  
and Shareholder”. The Agreement included, inter alia, the following clause:  
2.3 Payment of Purchase Price. The Purchase Price will be paid as  
(a) Concurrently with the execution of this agreement, the Purchaser  
will pay to Behiel, Will & Biemans, Solicitors for the Vendors,  
in trust the sum of $700,000.00 to be applied firstly to the  
corporations [sic] indebtedness, and the balance toward the  
Vendor’s shares.  
(b) The remaining balance shall be paid by annual principal  
installments of $100,000.00 on June 15, 2015, 2016 and 2017.  
The said balance shall bear interest at the Royal Bank of Canada  
prime rate plus 5% until such time as the balance is paid in full.  
Each year at the time of the annual payment any interest accrued  
shall be paid. To better secure payment the shareholders of  
the Purchaser shall provide promissory notes for the  
outstanding balance. [Emphasis added]  
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Buckle and MacDonald were not named as parties to the Agreement.  
While Buckle signed on behalf of Stony Lake, there is no personal reference to him in  
the Agreement, nor did he sign in his personal capacity. MacDonald was not named  
anywhere in the Agreement, nor did he sign it in any capacity.  
At that time, the Lefflers and Behiel believed the shareholders of Stony  
Lake were Buckle and MacDonald. George Leffler avers that when they attended to  
sign the Agreement, Behiel assured them that if the vendor-financed portion of the  
Agreement was not paid, there was appropriate security in place against the  
shareholders of Stony Lake.  
On August 25, 2014, the transaction closed, and Hall provided Behiel  
with an executed copy of the Agreement, a promissory note on behalf of Stony Lake,  
and the non-vendor financed portion of the purchase price to be held in trust. No  
promissory notes or personal guarantees were included.  
Behiel contacted Hall, who advised Buckle and MacDonald were not  
prepared to sign personal guarantees. Behiel has no notes of this conversation, nor does  
he have notes of the subsequent discussion where he allegedly told the Lefflers that  
Buckle and MacDonald refused to provide personal guarantees. George Leffler denies  
that he was aware these promissory notes were not provided and deposes that it was not  
until the parties attended mediation when the Lefflers discovered there were no  
promissory notes in place for Buckle and MacDonald. However, for the purposes of the  
summary judgement application, the Lefflers indicate they will accept that this meeting  
occurred as set out by Behiel in the transcript of his questioning on January 25, 2017  
And during this review what did you say about the contents of  
the promissory note?  
What did I say about it? That there’s – probably wouldn’t have  
said much, there’s a promissory note of the company.  
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Okay. Did you say anything else about the significance of this  
promissory note?  
No, I did not say anything about the significance of the  
promissory note. I know we did have a discussion about having  
to potentially, if things went sideways, go back and sue on the  
terms of the agreement and the promise of the shareholders.  
But I don’t know when that discussion was.  
Okay, and what were the contents of that discussion?  
That we could go back and sue on the agreement to the  
You advised that they would be able to sue the individual  
shareholders based on this agreement?  
I said we could sue –  
the shareholders based on the agreement, yes.  
Okay, even though they didn’t have any promissory notes  
actually in place?  
I said we could go back and try and enforce the terms of the  
agreement, yes.  
Okay. With this particular promissory note, you discussed who it  
would be enforceable against, correct?  
I would believe so, but, again, I don’t recall that.  
[Transcript, page 70, line 8, to page 71, line 20]  
So it was your legal opinion that you could sue the individual  
shareholders of this agreement despite not having any promissory  
notes in place.  
That we could go back and pursue on the agreement, correct.  
[Transcript, page 77, lines 8-20]  
And we proceeded on the basis of the promissory note of the  
company and of me saying, yes, we could go back and sue them  
if we had to.  
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[Transcript, page 103, lines 11-14]  
[Leffler Affidavit, Exhibit 32]  
The Lefflers provided instructions to close the transaction. Both Behiel  
and the Lefflers remained under the belief that Buckle and MacDonald were  
shareholders of Stony Lake and would have personal liability for the vendor-financed  
portion of the Agreement.  
a. The First Payment  
On June 15, 2015, the first payment came due for the vendor financed  
portion of the Agreement. This payment was not received. On July 10, 2015, Behiel  
sent a demand letter to Hall, stating:  
Further to our telephone discussion and my various emails, and due to  
the fact that there has been no response or information forthcoming or  
any response to my recent question if you are able to accept service of  
the statement of claim or a demand letter. This letter will serve to  
confirm that I am sending a formal demand for payment pursuant to  
the promissory notes directed to Cory Buckle and Heath MacDonald  
and Stony Lake Construction [Emphasis added]  
[Behiel Affidavit, Exhibit 46]  
[Leffler Affidavit, Exhibit 38]  
On July 16, 2015, the first payment of $112,345.87 was deposited to  
Behiel’s trust account on trust conditions. The Lefflers took the position that the interest  
calculation was insufficient and initially did not accept the funds.  
Shortly after, rumours began to swirl that the assets which formerly  
belonged to Leffler Excavating were being sold off and that Stony Lake was being  
liquidated and dissolved. On August 18, 2015, Behiel emailed Hall, stating:  
Do you have any update for me?  
The story I am getting locally is that the business is being shut down.  
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All assets were sold at the auction.  
I haven’t started a statement of claim to sue on the debt. The agreement  
said personal guarantee of the shareholders so if I have to pursue it  
will be both of them personally.  
I would appreciate an update. [Emphasis added]  
[Behiel Affidavit, Exhibit 51]  
[Leffler Affidavit, Exhibit 43]  
On December 8, 2015, the payment of $112,345.87 was released to the  
3. The Fallout  
Despite the release of the first payment, the Lefflers maintained their  
position that there was additional interest owing at prime plus 5%, which was never  
paid. They appear to have become very nervous about the prospects of recovering the  
vendor-financed portion of this transaction.  
On January 14, 2016, Behiel served a statement of claim (QBG 1649 of  
2015, Judicial Centre of Saskatoon) on behalf of the Lefflers to force payment of the  
remaining purchase price of $200,000 plus interest as well as the outstanding interest  
on the June 1, 2015, payment. He named Stony Lake, Cory Buckle and Heath  
MacDonald as defendants. This statement of claim included the following paragraphs:  
3. The Defendants, Cory Buckle and Heath MacDonald, are  
individuals who are the primary shareholders of Stony Lake  
Construction Ltd.  
4. The Plaintiffs entered into an Agreement for Sale with the  
Defendant, Stony Lake Construction Ltd., for the sale of a  
5. Pursuant to the terms of the Agreement for Sale the Plaintiffs  
were to receive an initial payment, and further payments of  
$100,000.00 plus interest, at a rate of the Royal Bank of Canada  
prime rate plus 5%, payable by annual instalments on June 1,  
2015, June 1, 2016, and June 1, 2017.  
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6. The Agreement for Sale provided that the Defendants, Cory  
Buckle and Heath MacDonald, would provide personal  
guarantees to secure the outstanding payment owing.  
[Behiel Affidavit, Exhibit 58]  
[Leffler Affidavit, Exhibit 47]  
On February 3, 2016, Behiel again wrote to Hall requesting personal  
guarantees. This correspondence included the following:  
Also, are you [sic] clients prepared to now execute personal  
guarantees for the balance owing. This would help me greatly appease  
my client so that I can show him that your clients are serious about  
paying this and that there is minimal risk of them not completing? Or  
perhaps a settlement agreement stating that the action will be held in  
abeyance and if they miss (late) on next payment that we are able to  
Note for Default rather than a discontinuance right now?  
[Behiel Affidavit, Exhibit 60]  
[Leffler Affidavit, Exhibit 48]  
On the same date, Behiel emailed the Lefflers. While he advised that a  
number of possible solutions were proposed to Hall, he did not advise that he had  
included a request for personal guarantees from Buckle and MacDonald.  
On February 4, 2016, Hall provided a trust cheque in the amount of  
$8,814.39 for the interest owed on the first payment with the condition that a  
discontinuance was filed in QBG 1649 of 2015 and that the Lefflers withdrew their  
demand for full payment of the outstanding amount. On February 7, 2016, the Lefflers  
agreed to discontinue the action in QBG 1649 of 2015 on the following conditions:  
interest be paid to December 10, 2015; Stony Lake pay an outstanding materials invoice  
of $4,100.00 plus interest; Stony Lake pay the Lefflersaccounting invoice of  
$1,084.86; and Stony Lake pay the Lefflerslegal costs. Ultimately, this cheque was  
returned as the trust conditions were not accepted.  
On June 13, 2016, Stony Lake, Buckle and MacDonald filed their  
statement of defence and counterclaim in QBG 1649 of 2015, with the following denial:  
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11. The Defendants, Cory Buckle and Heath MacDonald, deny  
providing personal guarantees, or on any other basis being liable  
to the Plaintiffs, for the indebtedness of the Defendant, Stony  
Lake Construction Ltd., to the Plaintiffs, such indebtedness  
specifically denied.  
[Behiel Affidavit, Exhibit 70]  
[Leffler Affidavit, Exhibit 54]  
There is no indication in Behiel’s records that the statement of defence  
and counterclaim was provided to the Lefflers. The Lefflers deny being provided with  
a copy.  
On January 25, 2017, the Lefflers attended mediation with Behiel. The  
defendants in QBG 1649 of 2015 were now being represented by Donnon Revering  
[Revering]. It was at mediation where the Lefflers learned that the shareholders of  
Stony Lake were not Buckle and MacDonald but, rather, a holding company,  
C2 Holdings Inc. As confirmed in the Transcript, Behiel did not recall when he advised  
the Lefflers that Buckle and MacDonald were not actually the shareholders of Stony  
Lake (Transcript, page 107, lines 14-18 (Behiel Affidavit, Exhibit 56; Leffler Affidavit,  
Exhibit 57)).  
There was no resolution at mediation. Following the mediation, Revering  
sent a letter to Behiel on January 27, 2017, proposing a global resolution to the  
litigation. He confirmed Stony Lake had not operated since approximately August 2015  
and had sold the equipment to repay debt to another creditor. As the sale proceeds from  
the equipment were insufficient to pay this other creditor in full, MacDonald had  
stepped in to pay the balance. The correspondence concluded thus:  
You indicated the Agreement contemplates personal guarantees being  
executed by Mr. MacDonald and Mr. Buckle, however, the Agreement  
makes no reference to an obligation on the part of Heath MacDonald  
and/or Cory Buckle to provide personal guarantees. Nor does the  
correspondence between your office and our office contemplate  
guarantees being provided.  
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At this time, we note you have not returned our trust cheque in the  
amount of $8814.39, which was forwarded to you with our  
correspondence of February 23, 2016. The cheque was forwarded to  
your office on specific trust conditions which were not accepted by  
yourself. Please immediately return the cheque.  
Thank you for your cooperation at the mediation. This was an  
unfortunate circumstance for all the parties and we believed the parties  
executing mutual releases and discontinuances in relation to both the  
Claim and Counterclaim is in the best interest of all parties.  
[Behiel Affidavit, Exhibit 74]  
[Leffler Affidavit, Exhibit 58]  
Again, the Lefflers allege this correspondence was neither provided to  
nor discussed with them. At questioning, Behiel did not recall whether he specifically  
discussed this letter with the Lefflers.  
Behiel discontinued the Lefflers’ claim against Stony Lake, Buckle and  
MacDonald and returned the trust cheque. A discontinuance was executed by Behiel in  
QBG 1649 of 2015 on behalf of the Lefflers on May 17, 2017.  
The Lefflers allege this discontinuance was without their knowledge or  
consent. Behiel subsequently requested that they provide a signed release, which they  
The Lefflers issued a statement of claim on May 10, 2018, amended  
September 4, 2019, and June 28, 2020, which provides an overview of the Lefflers’  
version of events leading to their claim against Behiel.  
In his statement of defence, Behiel’s position is that he advised the  
Lefflers of their options and risks and that they chose to proceed anyway. Behiel’s  
position is that he exercised the care, skill, knowledge and diligence required in the  
performance of his duties as the Lefflerssolicitor.  
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In their application for summary judgment, filed June 9, 2020, the  
Lefflers seek the following:  
(a) Judgment, or in the alternative damages, in the amount of  
$300,000.00 less applicable payments thereon plus interest at the  
Royal Bank of Canada prime rate plus 5% per annum from  
August 25, 2014, until the date of judgment;  
(b) Post judgment interest thereon to the date of payment; and  
(c) Costs of this action payable forthwith.  
Behiel has also filed an application for summary judgment seeking an  
order dismissing the Lefflersclaim.  
While the defendant raises in his statement of defence a defence under  
The Limitations Act, SS 2004, c L-16.1, that does not form part of his application for  
summary judgment. Nor does a preliminary review of the relevant dates suggest this is  
a live issue.  
I have set out the following issues on these competing applications for  
summary judgment:  
1. Is summary judgment appropriate?  
2. What is the standard of care owed to the Lefflers?  
a. The reasonably competent lawyer  
b. The rules of expert evidence  
c. The expert reports  
3. Is the expert evidence admissible?  
a. Behiel’s position  
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b. The weight given to the expert evidence  
4. Did Behiel meet the standard of a reasonably competent lawyer?  
a. Mistaken assumption  
b. Action on the promise of the promissory notes  
c. Conclusion on the standard of care  
5. Is there a genuine issue requiring a trial?  
6. What damages did the Lefflers suffer?  
Issue 1: Is summary judgment appropriate?  
The Queen's Bench Rules set out the procedure for an application for  
summary judgment:  
7-2 A party may apply, with supporting affidavit material or other  
evidence, for summary judgment on all or some of the issues raised in  
the pleadings at any time after the defendant has filed a statement of  
defence but before the time and place for trial have been set.  
7-3 (1) A response to an application for summary judgment must not  
rely solely on the allegations or denials in the respondent's pleadings,  
but must set out, in affidavit material or other evidence, specific facts  
showing that there is a genuine issue requiring a trial.  
(2) The Court may draw an adverse inference from the failure of a  
party to cross-examine on an affidavit or to file responding or rebuttal  
(3) An affidavit for use on an application for summary judgment  
may be made on information and belief as provided in rule 13-30, but,  
on the hearing of the application, the Court may draw an adverse  
inference from the failure of a party to provide the evidence of any  
person having personal knowledge of contested facts.  
Rules 7-5(1) and (2) state when a court may grant a summary judgment:  
7-5(1) The Court may grant summary judgment if:  
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(a) the Court is satisfied that there is no genuine issue requiring  
a trial with respect to a claim or defence; or  
(b) the parties agree to have all or part of the claim determined  
by summary judgment and the Court is satisfied that it is  
appropriate to grant summary judgment.  
(2) In determining pursuant to clause (1)(a) whether there is a  
genuine issue requiring a trial, the Court:  
(a) shall consider the evidence submitted by the parties; and  
(b) may exercise any of the following powers for the purpose,  
unless it is in the interest of justice for those powers to be  
exercised only at a trial:  
(i) weighing the evidence;  
(ii) evaluating the credibility of a deponent;  
(iii) drawing any reasonable inference from the evidence.  
The evolution of the law in relation to summary judgments began with  
the Supreme Court's decision in Hryniak v Mauldin, 2014 SCC 7, [2014] 1 SCR 87  
[Hryniak], which made summary relief more readily accessible than it once was. The  
Supreme Court of Canada determined that summary judgment applications have a  
greater role to play in the administration of justice by simplifying pre-trial procedures  
and moving the emphasis away from conventional trials. At paragraph 49, the Court  
There will be no genuine issue requiring a trial when the judge  
is able to reach a fair and just determination on the merits on a motion  
for summary judgment. This will be the case when the process  
(1) allows the judge to make the necessary findings of fact, (2) allows  
the judge to apply the law to the facts, and (3) is a proportionate, more  
expeditious and less expensive means to achieve a just result.  
The decision of Barrington-Foote J. (as he then was) in Tchozewski v  
Lamontagne, 2014 SKQB 71, [2014] 7 WWR 397 [Tchozewski], elaborated on the  
decision in Hryniak. At paragraph 30 of Tchozewski, Justice Barrington-Foote sets out  
the key elements and principles on a summary judgment application, and I remain  
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mindful of the detailed considerations outlined in this decision. He notes that the central  
question is whether summary judgment will achieve a “fair process that results in a just  
adjudication of the dispute before the court.”  
In Saskatchewan Power Corporation v All Canada Crane Rental Corp.,  
2019 SKQB 61, Justice Layh addressed reciprocal summary judgment applications at  
paragraphs 3, 37 and 38:  
At once the court is faced with diametrically opposed  
summary judgment applications, one seeking dismissal of the claim  
and one seeking damages for the same claim: dismissal, because the  
claim is unsupported by law and no genuine issue of material fact  
requires a trial; damages, because the claim is securely anchored in  
law and no genuine issue of material fact requires a trial to award and  
assess damages. In this instance, the court must either find one party's  
position of little or no merit and the other party's position of sufficient  
merit to grant summary judgment, or find that neither party's position  
merits summary judgment and dismiss both applications and order the  
matter to proceed in the normal course.  
In this instance the defendants seek a summary judgment to  
dismiss the plaintiff's claim. Simultaneously, the plaintiff seeks a  
summary judgment for damages in negligence. Essentially, then, the  
party moving for summary judgment must show that its position is  
sufficiently straightforward, and the opposing party's position so  
correspondingly lacking, that no genuine issue requires a trial and if  
an issue requires a trial, that the court has the required evidentiary  
basis to avoid a trial and summarily resolve all issues before it.  
However, when opposing the other party's application for  
summary judgment, each party must show that, indeed, a genuine  
issue requires trial, and a trial cannot be avoided by using the new  
fact-finding rules.  
There is a narrow issue between the parties which is largely dependent on  
the facts and the application of well-established legal principles. Throughout my  
analysis, I remain mindful of the shifting burden in summary judgment applications.  
The facts in this case are largely undisputed, and the issue rests largely on the  
application of the law to the facts. Questioning has been conducted, which provides  
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additional context and detail to the issues in dispute. When the evidence is examined,  
it is doubtful that the evidence would differ or expand at trial. In my view, and on the  
evidentiary record before me, the issues between the parties are straightforward and  
well-suited for a summary judgment application.  
This is the kind of case that was described by Justice Karakatsanis in  
Hryniak, at para 4:  
... In my view, a trial is not required if a summary judgment  
motion can achieve a fair and just adjudication, if it provides a process  
that allows the judge to make the necessary findings of fact, apply the  
law to those facts, and is a proportionate, more expeditious and less  
expensive means to achieve a just result than going to trial.  
It is against this legal framework that the present application must be  
Issue 2: What is the standard of care owed to the Lefflers?  
[62] It is well established that a duty of care by a lawyer to a client or person  
in near proximity may arise by way of an actual or implied contract, the tort of  
negligence, or a fiduciary relationship between them. As noted in Piller v Schmidt, 2019  
SKQB 16 at para 48 [Piller], in a negligence claim, the plaintiff must establish that a  
duty of care existed, that the standard of care was breached and that the breach caused  
a loss.  
There is no dispute that a duty of care was owed by Behiel to the Lefflers.  
The issue is the standard of care, or what steps a reasonably competent lawyer would  
take in these circumstances, and whether that standard of care was breached.  
a. The reasonably competent lawyer  
The requisite standard was established by the Supreme Court of Canada  
in Central Trust Company v Rafuse, [1986] 2 SCR 147. There, the Court comments that  
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a lawyer is “required to bring reasonable care, skill and knowledge to the performance  
of the professional service which he has undertaken(page 208).  
In Piller, Tholl J. (as he then was) commented on the standard of care:  
Beginning with the standard of care, it is well established the  
standard of care for a lawyer in relation to their client is that of  
a reasonably competent lawyer, also referred to as an ordinarily  
competent lawyer or an ordinarily prudent lawyer, in the same  
circumstances (Central Trust Co. v Rafuse, [1986] 2 SCR 147 at  
para 66 (WL)). This standard has been determined to include the  
following requirements:  
(a) To be skilful and careful.  
(b) To advise his client on all matters relevant to his retainer, so  
far as may be reasonably necessary.  
(c) To protect the interests of his client.  
(d) To carry out the client's instructions by all proper means.  
(e) To consult with his client on all questions of doubt which do  
not fall within the express or implied discretion left to him.  
(f) To keep his client informed to such an extent as may be  
reasonably necessary, according to the same criteria.  
(Tiffin Holdings Ltd. v Millican (1964), 49 DLR (2d) 216 (Alta  
SC); Kopp v Halford, 2013 SKQB 128, at para 88, [2013] 11  
WWR 713 [Kopp])  
In Kopp v Halford, 2013 SKQB 128, [2013] 11 WWR 713 [Kopp],  
Barrington-Foote J. (as he then was) discussed these requirements and considered how  
they relate to the duty owed by a lawyer to a client:  
These obligations, which apply in relation to any retainer, give  
rise to a duty to warn the client of the risks of pursuing a particular  
course of action: see, for example, Gallop v. Abdoulah, supra, at paras.  
18-20, and Precision Remodeling Ltd. v. Soskin, Soskin & Potasky  
LLP, [2008] O.J. No. 2560 (QL) (Ont. Sup. Ct.), at para. 56. That  
obligation is nicely summarized in the following passage from the  
reasons of Goodman J. in Major v. Buchanan, (1975), 9 O.R. (2d) 491,  
61 D.L.R. (3d) 46 (Ont. H.C.J.), at para. 58:  
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58 ... a solicitor has the duty of warning a client of the risk  
involved in a course of action, contemplated by the client or by  
his solicitor on his behalf, and of exercising reasonable care and  
skill in advising him. If he fails to warn the client of the risk  
involved in the course of action and it appears probable that the  
client would not have taken the risk if he had been so warned, the  
solicitor will be liable. If he warns the client of the risk involved  
in the course of action, then he can only proceed to follow such  
course if the client instructs him so to do. If he fails to exercise  
reasonable care and skill in advising the client with respect to his  
risk and the client or solicitor on his behalf adopts a course of  
action which the client would probably not have taken or  
authorized if he had been properly advised, again, the solicitor will  
be liable if the client suffers a loss. ...  
See also Grover v. Weir, [1987] 3 W.W.R. 465, [1987] S.J. No. 105.  
In Hatch v Cooper, 2001 SKQB 491, [2002] 2 WWR 159, Klebuc J. (as  
he then was) commented on the level of knowledge a reasonably competent lawyer  
should have and the typical means to establish that standard:  
It is well established that in discharging her or his duty of care,  
a lawyer need exercise only a reasonable standard in order to avoid  
liability. Mr. Justice Le Dain in Central Trust Co. at p. 208 [S.C.C]  
succinctly articulated that standard of care as follows:  
A solicitor is required to bring reasonable care, skill and knowledge to  
the performance of the professional service which he has undertaken. ...  
The requisite standard of care has been variously referred to as that of  
the reasonably competent solicitor, the ordinary competent solicitor and  
the ordinary prudent solicitor. ...  
It follows that a lawyer is not required to know all law  
applicable to a retainer that he or she has undertaken but must have  
sufficient knowledge of the issues associated therewith, including the  
applicable principles, to the extent he or she appreciates that additional  
research is required and undertakes such research. Therefore, the issue  
often is not whether the lawyer made a mistake but whether the  
mistake was one that an ordinary competent lawyer would not have  
made. This standard is customarily determined through the testimony  
of other legal practitioners regarding the knowledge and procedures  
they apply in their practice in the same or similar areas of law.  
In Calyniuk Restaurants Inc. v Gabruch, 2007 SKQB 322, 301 Sask R  
199 [Gabruch], Laing C.J. (as he then was) commented on the risks inherent in  
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transferring a business without securing the full purchase price:  
Mr. William Hood, Q.C., a senior and experienced lawyer in  
the matter of commercial and real estate transactions, gave expert  
evidence on behalf of the plaintiffs. He was qualified as expert in the  
legal aspects of commercial transactions including the legal  
documentation required in such transactions, the appropriate use of  
solicitors trust conditions, financial structures involved in such  
transactions, risks, and solicitor's due diligence. Without reviewing  
Mr. Hoods evidence in detail, he offered the opinion that a reasonably  
competent Saskatchewan lawyer would explain the risks to his client  
of transferring title to land or the business without securing the  
payment of the purchase price. Normally this is accomplished by  
suitable trust conditions. He went on to state that a reasonably  
competent Saskatchewan lawyers obligation to his client is  
three-fold. First, to fully and plainly disclose all relevant facts in  
connection with the transaction to the client. Second, to advise the  
client of the legal consequences and the risks in connection with the  
transaction. Lastly, to obtain the clients instructions and complete the  
transaction pursuant to such instructions in a manner that minimizes  
the risks. He stated in his opinion, if the client was prepared to proceed  
in the face of risks identified by the lawyer, a reasonably competent  
lawyer would record, preferably by letter to the client, the facts and  
consequences of the clients instructions before embarking on any  
work to complete the transaction.  
These cases set out a well-established standard of care.  
b. The rules of expert evidence  
In PS International Canada Corp. v Palimar Farms Inc., 2016 SKQB  
232, Kalmakoff J. (as he then was) confirmed that expert opinion evidence, tendered  
by affidavit, is admissible on applications for summary judgment. Rules 5-37 and 5-39  
of The Queen’s Bench Rules govern the use of expert evidence in summary judgment  
applications and provide as follows:  
5-37(1) In giving an opinion to the Court, an expert appointed  
pursuant to this Division by one or more parties or by the Court has a  
duty to assist the Court and is not an advocate for any party.  
(2) The expert’s duty to assist the Court requires the expert to  
provide evidence in relation to the proceeding as follows:  
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(a) to provide opinion evidence that is objective and  
(b) to provide opinion evidence that is related only to matters  
that are within the expert’s area of expertise; and  
(c) to provide any additional assistance that the Court may  
reasonably require to determine a matter in issue.  
(3) If an expert is appointed pursuant to this Division by one or more  
parties or by the Court, the expert shall, in any report the expert  
prepares pursuant to this Division, certify that the expert:  
(a) is aware of the duty mentioned in subrules (1) and (2);  
(b) has made the report in conformity with that duty; and  
(c) will, if called on to give oral or written testimony, give that  
testimony in conformity with that duty.  
5-39(1) An expert’s report must:  
(a) contain, at a minimum, the following information or any  
modification agreed on by the parties:  
(i) the expert’s name, address and qualifications;  
(ii) the information and assumptions on which the expert’s  
opinion is based; and  
(iii) a summary of the expert’s opinion; and  
(b) be served as required by rule 5-40.  
(2) An expert’s report must be accompanied by a statement of the  
party tendering the expert, or that party’s lawyer, in Form 5-39  
identifying the area of expertise in which the expert is tendered to offer  
an opinion.  
In Piller, Justice Tholl discussed the importance of establishing an  
evidentiary basis when considering a claim of this nature:  
Simply stating this standard in terms of general principles,  
however, is insufficient for the inquiry that must be undertaken by a  
trial judge. A trial judge must be able to determine the content of the  
standard in order to apply the standard to the underlying facts of a  
specific case. There must be an evidentiary basis for the court to do  
so. It is generally necessary for a plaintiff to call expert evidence to  
provide this evidentiary foundation and the court must be cautious  
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about setting the standard absent expert evidence. (Kopp, at para 102;  
Mraz v Herman, 2016 ABCA 313, at paras 43 to 45, 42 Alta LR  
(6th) 1).  
The Lefflers have met these requirements and filed evidence from two  
lawyers, Jeffrey R. Burgess [Burgess] and David McKeague [McKeague], both of  
whom provide their opinion on the advice a reasonably competent lawyer would have  
provided the Lefflers in the sale of Leffler Excavating. Their assessments and opinions  
are contained in their individual reports, respectively the Burgess Report and the  
McKeague Report.  
c. The expert reports  
Due to the overlap between the Burgess Report and the McKeague  
Report, I will be addressing the Burgess Report. The opinion of Burgess, uncontradicted  
on the application for summary judgment, offers support for the Lefflersclaim that  
Behiel fell below the standard of care he owed them.  
Burgess provides his opinion on vendor-financed transactions. He  
references the Law Society of Saskatchewan’s Continuing Professional Development  
Seminar materials of Marie-France Menc, “Vendor Financing”, Buying and Selling a  
Business (Regina: Law Society of Saskatchewan, 2014), where the role of a lawyer  
acting for a vendor in a vendor-financed transaction was described as follows:  
The role of counsel is to advise on the legal implications of the vendor  
financing, since these terms have an effect on the face value of the  
purchase price agreed upon by the parties. For the vendor, it is a  
question of whether the vendor is adequately protected with respect to  
receiving the agreed upon purchase price. For the purchaser, it is a  
matter of whether the purchaser acquires the business it is expecting  
to purchase for the agreed upon price.  
In advising the vendor, counsel’s role is to advise on the risks of the  
proposed financing, and on the need for the payment terms to provide  
compensation to the vendor commensurate with those risks. A vendor  
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who is the founder of a business may have little or no experience in  
the business of lending and thus may not be aware of the implications  
of agreeing to defer payment of the purchase price. Counsel’s role is  
to explain these matters including the following:  
whether the vendor intends to monitor the loan, by requiring and  
reviewing (or engaging a qualified professional to review)  
financial statements and other management reports from the  
purchaser, in order to be informed of the financial condition and  
other affairs of the business on an ongoing basis and become  
aware of any warning signs of the purchaser’s inability to make  
future payments;  
what happens if the purchaser misses a payment, or advises the  
vendor that it will be unable to make any payment)(s) due to  
cash flow problems or if the purchase takes any action that is  
prohibited under the terms of the vendor financing, such as  
incurring additional debt that is prohibited under those terms;  
• the process for enforcing vendor’s rights under the security it  
holds, including the required notices, court procedures (for  
example, to foreclose under a mortgage), and time periods;  
the legal and practical limitations on enforcement of the  
vendor’s security under various scenarios, including the  
insolvency or bankruptcy of the individual or entity that granted  
the security; [Emphasis added]  
Burgess also references the text: Jennifer E. Babe and Jonathan Fleisher,  
Canadian Forms & Precedents Commercial Transactions Sale & Operation of a  
Business, loose-leaf (Rel 52, February 2020), 2d ed (Markham, Ont: LexisNexis, 2006)  
at §2.226:  
§2.226 It should be clear from the discussion that every aspect  
of an asset or share purchase agreement relates in some way to price.  
While lawyers generally do not, and should not, become involved in  
advising as to the appropriate price, they play a crucial role in ensuring  
that the purchaser receives what it has agreed to purchase at the price  
agreed upon and that the vendor receives the price it has agreed upon  
for the business it has agreed to sell. [Emphasis added]  
Burgess goes on to provide numerous options for security in  
vendor-financing transactions to minimize risk of loss in the event of default by the  
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purchaser, including security agreements or mortgages of a share pledge agreement. He  
also identifies registration of certain forms of security is preferred, such as through the  
Personal Property Registry or the Land Titles Registry.  
Burgess specifically comments on the objective of obtaining security:  
16. The objective of a reasonably competent lawyer acting for a  
vendor would be for the vendor to gave enough property of the  
purchaser secured so that, in the event of a default by the  
purchaser, the vendor would have the ability to ensure the  
repayment of the outstanding monies and enforcement costs  
incurred by enforcing its right under one or more security  
agreements and/or commencing a legal action pursuant to one or  
more guarantees.  
[Burgess Report, page 13]  
Burgess notes that a guarantee without a security agreement may help to  
minimize the risks assumed by a vendor by granting the right to bring a legal action  
against a guarantor upon default of the purchaser in a vendor’s effort to recover the  
purchase price. However, underlying all of these options is the need for due diligence  
as the vendor needs to know who is liable for the debt.  
The primary issue with this transaction is that there was no due diligence  
conducted to confirm the shareholders in Stony Lake. While the Lefflers operated on  
the assumption it was Buckle and MacDonald, this was for Behiel to confirm as part of  
his due diligence as it was central to the issue of security in the vendor-financed  
transaction and the foundation for the Lefflersconcerns related to getting paid the full  
negotiated amount for Leffler Excavating. In order to protect their interests and provide  
advice to the Lefflers, Behiel needed to determine who the shareholders in Stony Lake  
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Issue 3: Is the expert evidence admissible?  
a. Behiel’s position  
Counsel for Behiel admits that the expert reports provided by Burgess  
and McKeague are, at the threshold stage, logically relevant, necessary in assisting the  
trier of fact and not subject to an exclusionary rule. They do they not take issue with  
the personal qualifications of Burgess or McKeague, recognizing they are both  
experienced solicitors in the area of commercial litigation.  
However, counsel for Behiel objects to the tendering of these expert  
reports on other grounds. Behiel suggests that the relevant aspects of the Burgess Report  
are those related to due diligence and that any comments regarding documentation  
practices and note-taking are not in issue in this case, nor is Behiel’s file management  
related to the Lefflersclaims.  
Behiel argues that the facts and assumptions upon which Burgess based  
his opinion disregard the negotiations between the Lefflers and Buckle prior to Behiel  
being retained, do not consider the context in which Behiel was retained and do not  
contemplate that Wells Fargo took an interest in the equipment as security for their  
financing. Behiel argues it is significant that the Burgess Report does not reflect that  
the Lefflers had given Buckle control of the equipment. During his questioning,  
Burgess acknowledged these would change his opinion as it would make the  
negotiation of terms more challenging and impact the advice a lawyer could provide  
his client, including an inability to undo steps that may have been taken.  
Behiel asks that the Burgess Report is not admitted or, alternatively, that  
only those aspects which speak to due diligence should be admitted but that the weight  
assigned be limited given the concerns raised. At a minimum, he requests that  
limitations be placed on these opinions and asks the court to consider the weight  
assigned to this evidence. Counsel also raises objections to the McKeague Report based  
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on the duplication between it and the Burgess Report.  
In addition, counsel for Behiel raises concerns that both Burgess and  
McKeague were provided with the transcripts of cross-examination on the affidavits  
but were not provided the affidavits themselves. They suggest that the material provided  
for review raises concerns regarding independence, impartiality and bias. Notably,  
when questioning Burgess, he acknowledged his opinion may have been different in  
some respects if he considered the entire factual matrix.  
Behiel relies on Derby Holdings Ltd. v Wright Construction Western Inc.,  
2002 SKQB 247, [2002] 9 WWR 126, in which Baynton J. refused to admit expert  
evidence where the expert had been given the ability to read portions of the examination  
for discovery that were not read in at trial. His reasons reflected concerns with  
reviewing evidence which was not before the trier of fact and casting the expert in the  
role of an advocate, thereby jeopardizing their professional independence.  
It is a concern that Burgess and McKeague were not provided with the  
affidavits filed as evidence on the application as that is the evidence upon which the  
court will primarily rely in an application for summary judgment. However, I also note  
that an expert may be provided with information which is not necessarily borne out as  
evidence at trial. In this regard, taking the opportunity to question the proposed expert  
on their opinion will assist in ensuring the court understands the impact any different  
or additional information may have on their opinion. Questioning was conducted with  
Burgess; however, due to the timing of the McKeague Report, there was a limited  
opportunity to conduct questioning of McKeague.  
Counsel for Behiel objects to the admission of the McKeague Report.  
Again, they note that McKeague has relied on the transcripts from questioning which  
counsel suggests raises concern regarding impartiality, bias and independence. They  
note similar concerns with the absence of the Lefflersrole in negotiating the  
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transaction terms prior to engaging Behiel and also suggest McKeague makes factual  
findings, such as the sophistication level of the Lefflers. However, the most significant  
objection is with respect to necessity. They suggest that the McKeague Report is  
tendered simply to bolster Burgess’s opinion. They suggest that providing the  
McKeague Report is contrary to the Foundational Rules as well as the responsibilities  
of the parties to manage litigation in a timely and cost-effective way. They note the  
timing of the service and filing of the McKeague Report was after the parties agreed to  
proceed to summary judgment and that there was insufficient time to conduct  
b. The weight given to the expert reports  
I agree that Behiel’s file management, documentation practices and  
note-taking are not in issue in this application. As such, I disregard any commentary in  
the expert reports regarding these issues. However, with respect to the balance of the  
Burgess Report, I assess that the opinion set out speaks to the basic underlying  
principles in assisting a client in a commercial sale of a business with vendor-financing;  
security considerations in vendor-financed transactions; a legal summary outlining the  
distinction between promissory notes, personal guarantees and security agreements;  
and Burgess’s opinion on how this applies to the Agreement in question. I accept  
Burgess’s opinion on these issues.  
The assessments made in the McKeague Report are largely similar to the  
Burgess Report. In many ways, it is a duplication of the evidence provided in the  
Burgess Report. This is, of course, no fault of McKeague. In these circumstances, I find  
it unnecessary to assign significant weight to the McKeague Report.  
I also recognize that the timing of filing the McKeague Report may have  
impacted Behiel’s ability to cross-examine McKeague on his opinion. The affidavit of  
McKeague was filed on July 5, 2021. Case management occurred on July 28, 2020, and  
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was subsequently adjourned sine die on November 19, 2020. In my view, there was  
time to conduct cross-examination; however, I am also mindful of the need for  
proportionality and limiting costs in litigation as well as the Foundational Rules set out  
in Rule 1-3.  
In my view, even if I were to limit the weight of the expert evidence  
tendered, which I do not find is necessary, my conclusion in this matter would be the  
same. In Piller, Justice Tholl commented on the general requirement for expert  
evidence in the standard of care for lawyer negligence claims. He provided the  
following commentary on the when expert evidence is required in assessing whether a  
lawyer met the standard of a reasonably competent lawyer:  
Despite the general requirement for expert evidence regarding  
the standard of care, expert evidence is not always required in a lawyer  
negligence case. If the allegedly negligent conduct of a lawyer is so  
egregious that it is obvious the lawyers conduct has fallen below the  
standard of care, the court may determine the standard of care has been  
breached without expert evidence and without knowing the precise  
parameters of the standard. Even if the conduct is not egregious,  
conduct that can be readily determined to fall below that of  
a reasonably competent lawyer, because it is of a non-technical nature  
or falls within the knowledge of an ordinary person, does not require  
expert evidence on the standard of care. (Kopp, at paras 102 to 103;  
Krawchuk v Scherbak, 2011 ONCA 352, at paras 133 and 135, 332  
DLR (4th) 310.  
The court concludes expert evidence is generally required  
with regard to the standard of care in a lawyer negligence claim.  
Expert evidence is not required when the conduct is so egregious that  
it obviously falls below the standard of care. Such evidence is also not  
required when the conduct is of a nature that involves non-technical  
matters, consist of matters that an ordinary person can be expected to  
have knowledge of and the conduct can be readily determined to fall  
below that required of a reasonably competent lawyer.  
In circumstances where it is known that recovery may need to be extended  
beyond the corporation who is a party to an agreement, it is plain that you would need  
to know who you can seek recovery from and ensure they are legally connected to and  
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responsible for the debt.  
[93] Behiel was alive to the need to hold the shareholders liable for the debt;  
however, he overlooked the basic due diligence required to confirm who the  
shareholders were. In doing so, he acted on assumption and provided legal advice based  
on faulty facts. The Lefflers made decisions based on this advice and under the belief  
they had recourse against Buckle and MacDonald for the debt.  
Issue 4: Did Behiel meet the standard of a reasonably competent lawyer?  
There are two overarching issues that seriously impact the trajectory and  
outcome of this transaction. The first is that the Lefflers and Behiel were mistaken in  
their assumption that Buckle and MacDonald were the shareholders in Stony Lake. The  
second is that even when the documents were signed, Behiel knew there would not be  
promissory notes forthcoming from Buckle and MacDonald, even though they were  
still under the belief they are shareholders. At this point, it should have been apparent  
there would effectively be no security for the $300,000 that the Lefflers were financing.  
a. Mistaken assumption  
The mistaken assumption that Buckle and MacDonald are the  
shareholders of Stony Lake permeates throughout the transaction and impacts the  
validity of Behiel’s legal advice, particularly that there is an option to sue on the clause  
in the Agreement which required the shareholders to provide promissory notes.  
First, I would comment on the partiesrespective views as to what  
Behiel’s role was in this transaction.  
There is no dispute that the Lefflers negotiated many of the terms directly  
with Buckle. George Leffler avers that they relied on Behiel to conduct the required  
due diligence to protect their interests. They allege that Behiel did not perform any  
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searches for Stony Lake, Buckle or MacDonald which would assist in understanding  
the corporate structure or the financial stability of these parties. Behiel responds that  
this was not part of the retainer agreement, nor would it have made any difference as  
Stony Lake refused to provide any further promissory notes and the Lefflers had  
effectively concluded the sale before any agreement was signed.  
Further, the Lefflers allege that Behiel did not assess whether Stony Lake  
had any assets beyond the equipment being purchased from Leffler Excavating. Nor  
did he determine the corporate structure for Stony Lake by conducting a corporate  
profile report through the Province of Alberta, where it was registered.  
Behiel’s evidence is that he was retained by the Lefflers to “close the  
transaction”. He avers that he was “neither asked to nor retained to provide any legal  
services in relation to business decisions, nor to conduct any diligence searches in  
relation to the purchaser” (Behiel Affidavit, paragraph 8). However, he was not merely  
acting as a clerk to prepare the documents and facilitate signing. He was being engaged  
for his legal expertise and to provide advice to the Lefflers to assist, as best he could,  
in meeting their clearly stated goal of ensuring they were paid for the vendor-financed  
portion of the loan.  
However, even after Behiel knew no promissory notes or guarantees were  
forthcoming from Buckle and MacDonald, he continued to advise the Lefflers that  
Buckle and MacDonald would be liable under the Agreement. Unfortunately, this was  
not accurate. To reflect the comments of Laing C.J. in Gabruch, Behiel’s role as the  
Lefflerslawyer was to tell them they were effectively gambling $300,000.  
In my view, one of the primary reasons for this is that Behiel did not  
perform his due diligence to confirm the shareholders for Stony Lake. This left the  
vendor-financed portion of the transaction effectively unsecured. The advice he  
provided the Lefflers in this transaction relies heavily on the faulty assumption that the  
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shareholders in Stony Lake were Buckle and MacDonald. This assumption tainted his  
advice on who was liable for the vendor-financed portion of the sale and carried into  
subsequent efforts to recover the outstanding amount from the sale of Leffler  
Excavating. In this respect, he fell below the standard of a reasonably competent lawyer  
and was negligent in the service he provided to the Lefflers, which negligence directly  
caused the loss claimed by the Lefflers.  
Behiel’s position is that he explored multiple options to reduce the  
Lefflersrisk with the vendor financing, including explaining the risks, requesting a  
higher interest rate, requesting personal guarantees and seeking to use the equipment as  
security. However, Behiel quickly discovered that some of the options discussed were  
not available, and this limited his ability to secure the vendor-financed portion of the  
transaction. Behiel suggests that his efforts to obtain promissory notes as a security  
measure was one of the few options available given the circumstances.  
While there were certainly complications in this transaction, that does not  
diminish Behiel’s obligation to assist the Lefflers with explaining and understanding  
the risks of vendor financing and the security available to them to protect their interests.  
A basic requirement of providing informed advice is to know who the parties are.  
With respect to the terms of a retainer, Barrington-Foote J. commented in  
I do not agree that the principle that the clients evidence is to  
be preferred in a dispute over the terms of a retainer is or should be so  
limited. The applicable principle, and the foundation on which it rests,  
was summarized by Lord Denning in Griffiths v. Evans, [1953] All  
E.R. 1364 (C.A.), as follows:  
The duty of a solicitor depends, of course, very much on what he is  
employed to do. ... On this question of retainer, I would observe that  
where there is a difference between a solicitor and his client on it, the  
courts have said for the last hundred years or more that the word of the  
client is to be preferred to the word of the solicitor, or, at any rate, more  
weight is to be given to it; ...The reason is plain. It is because the client  
is ignorant and the solicitor is, or should be, learned. If the solicitor does  
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not take the precaution of getting a written retainer, he has only himself  
to thank for being at variance with his client over it and must take the  
As is the case here, where there is a dispute as to what Behiel was retained  
to do, that failure falls to him. There is no evidence to suggest that the scope of Behiel’s  
legal services was restricted or limited to anything other than that of a reasonably  
competent lawyer.  
Behiel also points to the decision of the British Columbia Court of Appeal  
in Sports Pool Distributors Inc. v Dangerfield, 2009 BCCA 483, 277 BCAC 257,  
which, in overturning the trial judge’s decision, commented on the distinction between  
a lawyer hired to negotiate terms and one who is instructed to incorporate agreed upon  
terms into an agreement:  
In the main, the judge found Mr. Dangerfield did not meet the  
standard of care of a reasonably competent solicitor in that he failed  
to structure the transaction in a manner that would ensure Sports Pool  
was in a position to give notice of the assignments and directions to  
pay to the subdistributors such that it did not have to rely on North  
American to do so. In my respectful view, Mr. Dangerfield cannot be  
said to have been negligent in structuring the transaction. It was not  
open to him to structure it as he saw fit. He was, as the judge said at  
the outset, retained to negotiate. He was to negotiate the terms of an  
agreement that would serve to structure the proposed transaction  
Mr. Murdoch and Mr. Clarance discussed before the solicitors became  
involved. The distinction is important.  
This is not a case where the parties had settled upon terms  
which a solicitor was then instructed to incorporate in an agreement  
and did so ineffectively. It is to be distinguished in this regard from  
cases of that kind like Zink v. Adrian, 2005 BCCA 93, 37 B.C.L.R.  
(4th) 389, to which the judge referred. There, in drafting an agreement  
to reflect terms that were acceptable to both parties, a solicitor drew a  
clause which could not be enforced and then failed to either give a  
required notice to a third party or advise her client to do so. Here, the  
terms of the agreement were not settled; Mr. Dangerfield was to  
negotiate them with Mr. Atkins.  
A solicitor who accepts instructions to negotiate an  
agreement, even where, as here, he is expressly instructed to maximize  
his client’s protection, cannot give any assurance the terms he will be  
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able to obtain will necessarily achieve the level of protection the client  
wishes to have. As Mr. Murdoch observed in his testimony,  
negotiations are by their nature always a matter of give and take. A  
solicitor can only attempt through his negotiating skill to minimize his  
client’s risk. But the extent to which he can do so will invariably  
depend on the terms he is able to obtain. Some solicitors are, of course,  
better negotiators than others.  
I do not consider a solicitor can be held to have been negligent  
in the conduct of negotiations because he did not obtain a term that, at  
a later time, is said may have been available. It is not necessary to  
consider what the solicitor’s position would have been here if the term  
had been available. The most that could be said is that Mr. Dangerfield  
may have been able to obtain North American’s agreement to give  
Sports Pool executed notices of assignment and directions to pay at  
the time the Guarantee Agreement was executed. Mr. Dangerfield  
acknowledged he knew of no reason that could not have been done,  
but there is, however, no evidence North American would have  
agreed. Indeed, Mr. Dangerfield was told by Mr. Clarance that North  
American had reservations about the subdistributors being directed to  
pay a third party like Sports Pool. It had not been done before in North  
American’s experience in dealing with the subdistributors and there  
was concern the subdistributors would become alarmed about not  
paying directly to North American.  
I consider the burden of the duty owed by a solicitor who  
undertakes the negotiation of an agreement lies in his ensuring the  
client understands the implications of the terms to be agreed to the  
extent necessary to enable the client to make an informed decision as  
to whether to proceed with the transaction. Of utmost importance is  
the client’s appreciation of the contractual risks and consequent  
financial exposure arising on the terms of the agreement, and of less  
risky alternatives that might be available. At least as a general  
proposition, a client who properly understands an exposure, and who  
proceeds with a transaction, cannot later be heard to complain his  
solicitor failed him in respect of the terms obtained in the negotiations  
the solicitor conducted. It is then a question of advice: did the solicitor  
meet the requisite standard of care in advising his client on the terms  
of the agreement?  
It follows that I do not consider Mr. Dangerfield can be said  
to have been negligent in failing to obtain terms that would have  
afforded Sports Pool better protection in respect of the risk inherent in  
clause 7.3 of the Guarantee Agreement. In my view, the judge’s  
conclusion was predicated on a misapprehension of Mr. Dangerfield’s  
function that is fundamental to the finding of negligence made in this  
- 36 -  
However, this was not a case where Behiel was negotiating the terms.  
Rather, it is a case where the lawyer ineffectively provided advice on the terms that  
were in the Agreement. While the Lefflers believed there was a security clause in place  
which would assist with recovery in the event of default, the reality is there was  
effectively no security. I am also mindful of a similar case from the British Columbia  
Court of Appeal, Zink v Adrian, 2005 BCCA 93, [2005] 4 WWR 420, where the court  
Counsel for Ms. Adrian has argued that the trial judge  
imposed an unrealistically high standard of care on a solicitor. In the  
appellant's view, a solicitors duty does not extend to ensuring or  
guaranteeing the expected results of the client nor to the extent of  
performing tasks beyond the solicitor's normal retainer without  
explicit instructions. With respect, I do not agree. The judge correctly  
applied the test as to what a reasonably competent solicitor would do  
having regard to the instructions and expectations of the client. In this  
case, it was clear that Ms. Zink wanted an enforceable security clause  
that would protect her interests. The judge found as a fact that Ms.  
Adrian failed to take the necessary steps to ensure that her client had  
a workable security clause in the agreement. He also found that Ms.  
Adrian failed to carry out her work with the care and skill expected  
from a solicitor in similar circumstances.  
Behiel points to decisions of this court such as Loubardeaus v W. (1984),  
33 Sask R 26, where Justice Noble states at paragraph 23:  
In addition, it has been frequently held that to comply with his  
professional duty to a client a lawyer is under an obligation to warn  
his client of any dangers inherent in a particular transaction which  
might cause him a loss. This flows from the fiduciary duty that a  
lawyer has to his client under the principle of Hedley Byrne & Co. v.  
Heller & Partners Ltd., [1964] A.C. 465 (H.L.). But aside from the  
fiduciary duty it has been held a solicitor is obliged as part of his  
retainer to alert his client of the risks that can be reasonably foreseen.  
In Major v. Buchanan (1975), 61 D.L.R. (3d) 46, Goodman, J., of the  
Ontario High Court put the principle as follows at p. 69:  
... that a solicitor has the duty of warning a client of the risk involved in  
a course of action, contemplated by the client or by his solicitor on his  
behalf, and of exercising reasonable care and skill in advising him. If  
he fails to warn the client of the risk involved in the course of action  
and it appears probable that the client would not have taken the risk if  
he had been so warned, the solicitor will be liable. If he warns the client  
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of the risk involved in the course of action, then he can only proceed to  
follow such course if the client instructs him so to do. If he fails to  
exercise reasonable care and skill in advising the client with respect to  
his risk and the client or solicitor on his behalf adopts a course of action  
which the client would probably not have taken or authorized if he had  
been properly advised, again, the solicitor will be liable if the client  
suffers a loss.  
But I ask, how can Behiel have provided the Lefflers with advice of the  
risk involved in a course of action if he did not know the facts underlying that advice?  
The issue is not that the Lefflers acted contrary to Behiel’s advice but, rather, that they  
relied on it. Behiel conducted himself as though Buckle and MacDonald were the  
shareholders. He represented that there was recourse against Buckle and MacDonald as  
“shareholders”. It was on this basis that Behiel commenced QBG 1649 of 2015 when  
Behiel attempted to recover the remaining payments under the Agreement. On behalf  
of the Lefflers, he commenced an action against Stony Lake as well as Buckle and  
MacDonald as shareholders of Stony Lake. This assumption impacted Behiel’s advice  
and actions until he was notified by opposing counsel that they were not, in fact,  
Regardless, it was both partiesunderstanding that the Lefflersprimary  
goal was to make sure they were paid what they were owed. What is clear is that the  
Lefflers believed Behiel was assisting them to provide some security for payment of  
the $300,000 they were financing. While the Lefflers accepted some risk that they may  
have to take steps to obtain the vendor-financed portion of the loan, they also believed  
they had a legal foundation to do so. They relied on Behiel’s advice and held the belief  
there was recourse for recovery when, in fact, there was none as there was no other  
party named in the Agreement, no other signatory to the Agreement, no provision that  
placed a clear obligation on any shareholder and no personal connection between  
Buckle or MacDonald and the debt.  
George Leffler avers that it was critical there was some form of security  
- 38 -  
against MacDonald and Buckle that they could fall back on if Stony Lake defaulted on  
these payments. In his questioning, Behiel recognized that MacDonald was the likely  
source for any funds to be recovered, as noted in the transcript of the cross-examination  
of Behiel at page 72, lines 1-8:  
A I know we talked once – again, I don’t know when – about whether  
or not [Buckle] had any assets.  
Q Mmhmm.  
A And I didn’t know [MacDonald], but we were told that he was a  
wealthy businessman, so we assumed that he would be the point  
of recovery if we ever had to recover –  
Q Yeah.  
A definitely, yeah.  
[Transcript, page 72, lines 1-10]  
[Leffler Affidavit, Exhibit 11]  
What is clear is that the Lefflers expected Behiel to protect their interests.  
They relied on his advice and believed there was some method to recover payment for  
the vendor-financed portion of the loan. This was well known to Behiel, and I note the  
following evidence found in the transcript of the cross-examination of Behiel at page  
25 line 23 to page 26 line 1; page 49 line 20 to page 50 line 11:  
Q Do you remember if George raised any concerns to you about the  
proposed purchase price not being paid?  
A Absolutely.  
[Transcript, page 25, line 23, to page 26, line 1]  
[Leffler Affidavit, Exhibit 10]  
A It would be the same as always. George was always clear. George  
has to get paid. I want my money. This is my yeah. That’s – no  
doubt about that.  
Q Mmhmm. And was George always clear on I have to get a  
guarantee of shareholder?  
- 39 -  
A George was always clear they had to get paid –  
Q Okay.  
A if I can put it that way.  
Q Was he always clear that he had to get prime plus 5 percent in  
A That was always the discussions, yeah.  
Q Okay. Was the guarantee of shareholder always in the  
A Well, that was in the discussions there definitely, yes.  
[Transcript, page 49, line 20, to page 50, line 11]  
[Leffler Affidavit, Exhibit 12]  
Behiel confirms that, at their meetings and in providing their instructions,  
the Lefflers were adamant that they needed to “get paid”. They were nervous about  
vendor financing and wanted to ensure the shareholders were personally responsible  
for the debt. Behiel’s advice and his assurances that the shareholders would be held  
responsible for the debt was of limited value without knowing who these shareholders  
were. Key in this understanding is that Behiel was doing what he could to ensure the  
Lefflers were paid for the vendor-financed portion of the sale. In order to do that, he  
clearly needed to know who the parties to the Agreement were, including the actual  
“shareholders” referenced therein.  
Behiel argues that his advice would not have changed even if he had  
obtained more information about the shareholders. His position is that he was left with  
extremely limited options for security given that Wells Fargo was taking security in the  
assets. He suggests that even if he had known C2 Holdings Inc. was the only  
shareholder in Stony Lake, this would not have changed his advice. Essentially, he  
suggests the only two options the Lefflers had would have been the same return the  
funds or go ahead with the sale and sue to enforce the Agreement.  
- 40 -  
However, the Lefflers were not aware that in suing to enforce the  
Agreement, Buckle and MacDonald had no legal responsibility for the debt. As such,  
the Lefflers did not know the full risks of the vendor-financed transaction they were  
entering. They could not knowingly assume that risk as they were under the mistaken  
belief that Buckle and MacDonald had personal liability through their negotiations and  
after they signed the Agreement.  
Behiel invites the court to accept that knowing the actual shareholders of  
Stony Lake would not have changed the situation as there was outright refusal to  
provide further promissory notes, other than the one from Stony Lake. As such, the only  
way to enforce the Agreement was to sue Stony Lake. However, in his affidavit, Behiel  
44. I spoke with the Lefflers after receiving Hall’s August 25, 2014  
letter. We spoke about the missing promissory notes from Stony  
Lake’s shareholders and the interest that Hall did not include.  
I recall discussing these issues with the Lefflers by phone. I told  
the Lefflers that they had options: they could choose not to close  
the transaction, the funds could be returned, or the transaction  
could close and they could sue on the promise in the [Agreement]  
to provide promissory notes from Stony Lake’s shareholders.  
59. At this time [July 10, 2015], I believed that Buckle and  
MacDonald were the shareholders of Stony Lake. As stated  
previously, I had spoken to Hall about the missing promissory  
notes from the Stony Lake shareholders after the Closing Funds  
arrived. At that time, the Lefflers instructed me to close the  
transaction despite the missing promissory notes. [Emphasis  
In fact, the following exchange arises in Behiel’s questioning:  
Q Okay, and prior to them signing it did you review the … 5-share  
purchase agreement with them?  
A Yes, we went through it.  
Q Okay, and what did you say about this agreement in your review?  
- 41 -  
A In what regard?  
Q I don’t know in what regard you reviewed it with them.  
A Well, we went through it. We went through the clauses, discussed  
the agreement.  
Q Okay, and did you discuss clause 2.3(b) of the agreement?  
A I don’t recall specifically – specifically discussing, but I’m sure  
we did would have because George , at every meeting, said he  
had to get paid, so we would have discussed the –  
Q Mmhmm.  
A security of the loan or the outstanding balance.  
Q And did you advise that he had a security in place to ensure he got  
A I would have said the agreement provided security, yes. [Emphasis  
[Transcript page 64, line 5, to page 65, line 5]  
[Behiel Affidavit, Exhibit 29]  
The advice with respect to suing on the promise in the Agreement to  
provide promissory notes relies on a faulty premise that Buckle and MacDonald are  
the shareholders in Stony Lake. The evidence satisfies me that both Behiel and the  
Lefflers clearly remained of the belief that Buckle and MacDonald were tied to the  
transaction and were a possible source of recovery in the event of default.  
If he advised the Lefflers that it was only Stony Lake who was legally  
responsible for the debt and they made an informed choice to proceed, that may well  
have resolved the issue. There was no absolute guarantee of payment. Vendor financing  
is fraught with risk. However, the evidence confirms that was not the advice provided.  
Behiel’s advice reflected a significant oversight and assumption that suggested there  
was a source of recovery which, in reality, was entirely unavailable in these  
- 42 -  
If a client makes unreasonable choices, then a lawyer will not be  
responsible. However, if a client has not been properly informed of its choices, then the  
lawyer may be negligent.  
b. Action on the promise of the promissory notes  
While Behiel attempted to pursue recovery against Buckle and  
MacDonald through QBG 1649 of 2015, it is undisputed that the Lefflers had no  
recourse against Buckle or MacDonald. Stony Lake sold all of the assets that had been  
purchased from Leffler Excavating and was no longer in operation. To continue the  
litigation against these parties would have only served to further expose the Lefflers to  
increased litigation costs, both on their own behalf and quite possibly ordered against  
The Lefflers assert that Behiel discontinued the claim in QBG 1649 of  
2015 on their behalf but without their consent, although they could not recall this with  
any certainty. It is unclear how this discontinuance transpired; however, for the  
purposes of this application, I am satisfied that I do not need to make a definitive  
determination on this point of fact. The reality is there was no legal basis to pursue  
Buckle and MacDonald for payment of the outstanding balance.  
In terms of attempting to determine Stony Lake’s shareholders, Behiel  
failed to request a copy of the corporate profile report for Stony Lake from the  
jurisdiction where the company was based, being the Province of Alberta, or to request  
any shareholder information from counsel for Stony Lake. Further, although it was  
assumed that MacDonald would be the “point of recovery” if recovery had to be made,  
Behiel did nothing to personally attach MacDonald to liability for the debt. Nor did  
Behiel make any effort to determine whether Stony Lake had any assets beyond those  
they were purchasing from Leffler Excavating.  
- 43 -  
c. Conclusion on the standard of care  
[124] Behiel failed to take the steps required to ensure there was a viable and  
enforceable security clause. Not only was he mistaken with respect to who the  
shareholders were, but he also was in error that any shareholder in Stony Lake would  
have legal responsibility for the debt under the vague reference to “shareholders” in the  
All of Behiel’s advice with respect to security and enforcement were  
compromised by the mistaken assumption that Buckle and MacDonald were the  
shareholders in Stony Lake. This assumption would have been easily dispelled either  
by conducting a search in the jurisdiction where Stony Lake was registered or by asking  
Hall for confirmation.  
Further, the Agreement drafted by Behiel made no mention of Buckle or  
MacDonald in their personal capacity nor did it seek to require them as signatories to  
the Agreement. It makes little sense to assume that a corporation, as a distinct entity,  
would bind its individual shareholders simply through a vague reference to  
“shareholders” in the Agreement, and especially so when the identity of the  
shareholders has not been confirmed. This is compounded by advising the Lefflers that  
this vague reference to unknown shareholders was somehow enforceable through  
litigation or that there was recourse against Buckle or MacDonald.  
Reluctantly, I must conclude that the standard of care expected of a  
reasonably competent solicitor in these circumstances was not met by Behiel. While he  
may otherwise be a perfectly capable solicitor, he failed to act to the level of reasonable  
care, skill and knowledge required in these circumstances.  
Issue 5: Is there a genuine issue requiring a trial?  
Summary judgment is appropriate where there is no genuine issue  
- 44 -  
requiring trial. However, the process must give a judge confidence in their conclusions.  
The assumption that Buckle and MacDonald were the shareholders  
permeated into Behiel’s subsequent advice, which was that the Lefflers could sue on  
the Agreement based on the provision that “the shareholders of [Stony Lake] shall  
provide promissory notes for the outstanding balance.” However, once again, this relied  
on Behiel’s assumption that Buckle and MacDonald were shareholders. Notably,  
neither Buckle nor MacDonald signed the Agreement in their personal capacity, nor  
were they specifically named in the Agreement.  
It is equally evident that Behiel remained under the misapprehension that  
Buckle and MacDonald were shareholders in Stony Lake up to the point of the  
mediation. He made demands and commenced action QBG 1649 of 2015 against them  
in their personal capacity in an effort to recover the payments owed to the Lefflers,  
which demonstrated he was under the belief that this could be done.  
The lack of due diligence to confirm the shareholders of Stony Lake  
rendered the advice Behiel provided to the Lefflers as uninformed and inaccurate. In  
my view, counsel must consider that a corporation may engage in complex structuring.  
To assume you know who the corporate shareholders are is a dangerous assumption to  
Without knowing who the shareholders actually were and operating on  
the incorrect assumption that it was Buckle and MacDonald, Behiel was not aware of  
the relevant facts and therefore he could not advise the Lefflers of the risks associated  
with the transaction or complete the transaction in a way that minimized the Lefflers’  
Effectively, Behiel did not take the steps required to ensure that the advice  
he was providing to the Lefflers was accurate based on the corporate structure of the  
- 45 -  
purchasing corporation, Stony Lake. As a result, he was unable to provide the advice  
the Lefflers required in order to ensure appropriate and reasonable steps were taken to  
secure the payment of the vendor financing. The effect was that the Lefflers were left  
without any security for the $300,000 which they financed. This was not their intention,  
but it was a logical outcome.  
There is no question that Behiel presented the Lefflers with their options  
on the signing of the Agreement with Stony Lake: not close on the sale and return the  
funds or close the transaction but risk having to sue to enforce the sale Agreement. At  
this point, all parties knew there were no additional promissory notes or personal  
guarantees forthcoming. Effectively, given the form of the Agreement, the $300,000  
was unsecured. But I do not see anywhere in the evidence that this advice was provided  
to the Lefflers. Instead, and despite not being signatories to the Agreement, Behiel’s  
advice suggests there was a method of recovery against Buckle and MacDonald. This  
arises from the mistaken belief that they were under an obligation to provide promissory  
notes by virtue of clause 2.3(b) in the Agreement. Again, the assumption that Buckle  
and MacDonald were the shareholders in Stony Lake permeates the advice given and  
misleads the Lefflers on the recourse available. Tying MacDonald to the debt was, as  
the evidence confirms, integral in the event of default.  
There is no question the Lefflers were aware of Buckle’s financial  
circumstances and the possibility that he would not repay the debt based on his financial  
history. The Lefflers and Behiel anticipated that if recovery had to be made, it would  
likely be MacDonald who would pay. From the evidence, it appears that MacDonald  
did have to inject cash in order to repay the secured portion of the loan when the  
equipment was sold. This confirms that MacDonald was the likely source of recovery  
in the event of default.  
Behiel’s belief that the Agreement provided security for the Lefflers is  
- 46 -  
demonstrated through his subsequent acts. Behiel’s actions in attempting to recover  
from Buckle and MacDonald reflect his ongoing mistaken assumption that they were a  
source of recovery in Behiel’s view. Had he known they were not shareholders in Stony  
Lake, his advice may well have changed.  
There is no question that the Lefflers decision to provide $300,000 in  
vendor financing was risky. But that risk could have been mitigated in some way. The  
issue I have is that Behiel did not fully appreciate the nature of the risk the Lefflers  
faced. As a result, he could not and did not provide accurate advice to the Lefflers.  
Before giving clients advice about the course of action to take in entering  
an agreement for the sale of a business with vendor financing and the security options  
available to the financing seller, an important early step for the reasonably competent  
lawyer is to determine the relevant legal principles that apply to the particular case  
before him and to know the legal entities involved in the transaction. A reasonably  
competent lawyer must determine the options available to a client in the event of  
default, including which parties can be pursued for recovery of the debt.  
There was also a point in the transaction that the Lefflers and Behiel knew  
that personal guarantees or promissory notes were not forthcoming. This was on  
August 24, 2014, when Hall returned the signed Agreement. At this point, the Lefflers  
could have backed out of the transaction and refused the trust cheque. Behiel argues  
that the Lefflersdealings with Buckle had proceeded to a point where they had  
effectively turned over the equipment and the deal was, in reality, done but for the  
signing of the Agreement. I pondered whether the Lefflers were, at that point, making  
a decision with the knowledge that they were effectively gambling the $300,000 they  
were personally financing.  
There is no question that the Lefflersapproach to negotiating the sale of  
their business presented Behiel with challenges. George Leffler had essentially  
- 47 -  
negotiated a number of terms of the Agreement without consultation with his lawyer.  
I agree that turning over control of the assets impacted the ability to negotiate the terms  
of the Agreement. However, while the Lefflers may have transferred control of the  
equipment, they did not transfer ownership. The transaction could be undone. Even if  
Buckle had locked the equipment into a compound, which is disputed by the Lefflers,  
there remained viable options available to the Lefflers prior to the transfer of ownership.  
The Lefflers still owned the equipment and could have taken steps to have it returned  
if the transaction fell apart. They lost that option after the sale concluded.  
Without knowing who the shareholders were, Behiel was unable to  
properly advise the Lefflers in the risks of the transaction or on how to obtain the  
security they required in order to ensure the required payments were made from one  
source or another.  
When I review the evidence, I am satisfied that the advice Behiel gave  
the Lefflers created the belief that they had recourse under the Agreement based on the  
provision that the shareholders “shall” provide promissory notes for the outstanding  
balance. Once again, the assumption that Buckle and MacDonald were the shareholders  
obligated to provide these promissory notes coloured the advice Behiel gave.  
It is another issue as to the strength of the promissory note as “security”  
in this transaction, and while the Burgess Report comments on the nature of a  
promissory note in a transaction of this nature, this is not the issue central to the  
application. To assess the types of security which may best serve the needs of a client,  
the factual foundation upon which that assessment is made must be accurate. As the  
factual foundation was flawed from the outset, all advice that flowed from it was  
As noted in Hryniuk, at para 49, there will be no genuine issue requiring  
a trial when the motions judge is able to reach a fair and just determination on the merits  
- 48 -  
on a motion for summary judgment. This will occur when the process (1) allows the  
judge to make the necessary findings of fact; (2) allows the judge to apply the law to  
the facts; and (3) is a proportionate, more expeditious and less expensive means to  
achieve a just result than a trial.  
There is a comprehensive record available which outlines the steps taken  
toward finalizing the Agreement. There has been extensive questioning, with relevant  
portions introduced into evidence. The issue of whether Behiel fell below the standard  
of care of a solicitor in the sale of a business and what, if any, damages should be  
awarded, can be fully resolved from the available evidence.  
In this case, the facts are largely undisputed, and the questioning  
conducted has assisted in providing the court with additional clarity and context for the  
underlying events leading to this action. The evidentiary record is highly detailed and  
allows the court to understand the significant events between the parties. While the  
parties’ respective interpretation of the facts may differ, I am comfortable in assessing  
the facts as provided or conceded for the purposes of the reciprocal summary judgment  
I am satisfied that I am able to make the necessary findings of fact, apply  
the facts to the law and that summary judgment would allow for a proportionate, more  
expeditious and less expensive means to achieve a just result. The law is relatively  
straightforward and readily applied to the facts before the court. There is no genuine  
issue for trial.  
I am satisfied that summary judgment is appropriate with respect to these  
In my view, Behiel’s application for summary judgment must fail as there  
is no basis upon which I would strike the statement of claim against him.  
- 49 -  
Conversely, the Lefflersapplication for summary judgment is granted.  
The facts that I have determined and the application of the law to those facts satisfies  
me that the standard of a reasonably competent lawyer was breached. I am able to reach  
a just result through proportionate, expeditious and less expensive means. Behiel has  
not refuted this evidence.  
Issue 6: What damages did the Lefflers suffer?  
The failure of Behiel to ascertain the shareholders of Stony Lake and  
subsequently provide advice on recovery from these shareholders effectively prevented  
the Lefflers from understanding or considering the true risks associated with providing  
vendor financing. In my view, this is particularly contradictory to the repeated  
statements of George Leffler, as acknowledged by Behiel, that he wanted to make sure  
he “got paid” the $300,000 that he financed as he “was not a bank”. Based on the  
Lefflers’ obvious nervousness with providing vendor financing, I seriously question if  
they would have proceeded with this transaction knowing there was no other party  
liable for the debt.  
There is no question the Lefflers knew they were taking on risk by  
accepting the responsibility of vendor financing for $300,000 of the purchase price.  
However, they were also mindful that there were options available to protect themselves  
in accepting this risk and relied on Behiel to ensure their interests were protected.  
Beyond the concerns with due diligence, I would also conclude that  
Behiel’s negligence extended to the legal advice he provided. Had Behiel advised the  
Lefflers that they were essentially gambling $300,000, I am of the opinion that the  
Lefflers would not have proceeded with the transaction. They were aware that Buckle  
had previous financial issues. They recognized that any recovery would likely come  
from MacDonald if Stony Lake defaulted. Had they known that MacDonald had no  
personal liability or legal connection to the transaction, it is highly doubtful they would  
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have taken such significant risks with the unpaid amount. As Behiel acknowledged,  
“George was always clear they had to get paid.”  
Behiel relies on the appraisal done by Ritchie Brothers to argue the  
Lefflers received more than what Leffler Excavating was worth at the time of sale.  
However, that appraisal does not take into account the entirety of the business including  
revenue, goodwill or additional equipment owned by Leffler Excavating. I reject this  
argument. Instead, I prefer the valuation inferred from the Agreement itself. The value  
assigned to the shares in Leffler Excavating was $1,000,000. This is the value  
negotiated between two armslength parties and the value that I assign to the company  
and the value which is owed to the Lefflers.  
An additional issue raised by Behiel is the non-competition clause in the  
Agreement, which relates to an ongoing contract for snow removal with the Potash  
Corporation of Saskatchewan [PCS]. George Leffler deposed that he believed Leffler  
Excavating remained under obligation to PCS to fulfill their existing contract. As such,  
he removed snow from their facility on one occasion in December 2014. George Leffler  
contacted PCS to explain the situation and ensure there would be no penalties for no  
longer providing snow removal. George Leffler also acknowledges that he provided  
free snow removal for a local church as they were low on funding. He also assisted a  
couple local farmers with excavating in exchange for what he owed when they seeded  
his crop. He derived no income from these services.  
When the claim in QBG 1649 of 2015 was commenced, Hall contacted  
Behiel and advanced the position that the Lefflers were in violation of the restrictive  
covenant. In my view, he performed this service to protect the reputation of the  
company which he had sold and to honour the contract which he had entered into prior  
to selling Leffler Excavating. While counsel for Behiel suggests issues of contributory  
negligence or the sophistication of the Lefflers in entering this transaction remain live  
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issues, these are peripheral issues which only arose after Behiel’s advice regarding the  
shareholders and liability for the debt.  
I do not view this as a significant issue in the claim or in the application  
for summary judgment. In my view, this was an issue raised solely for the purposes of  
Stony Lake, Buckle and MacDonald counterclaiming against the Lefflers in QBG 1649  
of 2015 and does not mitigate or reduce the purchase price for Leffler Excavating. The  
evidence of George Leffler clearly sets out the details of his limited snow removal and  
excavating work and the reasons for it. In my view, any damages assessed as a result of  
the potential breach of the restrictive covenant, if such breach were even found, would  
be nominal.  
Behiel suggests that based on the risk the Lefflers took in accepting the  
requirement for vendor financing, the absence of security interest available in the  
equipment and the need to rely on a promissory note from the shareholders, the Lefflers  
had only a chance for recovery in any event. I am not satisfied the circumstances of this  
case fall within the principles governing a “loss of chance”, as suggested by counsel for  
Behiel. Had the steps been taken to provide an improved level of security, the Lefflers  
would not have been relegated to a “chance” of repayment. The “chance” lost was  
significant, sufficiently real and rises above mere speculation.  
Damages should be assessed as if the Agreement was paid in full as it  
would have been if properly secured with guarantees by Buckle and MacDonald. This  
was the ongoing intention of both Behiel and the Lefflers. There is little question that  
MacDonald would have been the point of recovery, and the evidence confirms that any  
shortfall could have and would have been effected but for the negligence of the lawyer.  
As such, the vendor-financed portion of the Agreement which was not paid shall be  
borne by Behiel.  
In calculating this amount, I note that the amount of $300,000 was owed  
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through $100,000 payments on June 15 of 2015, 2016 and 2017, with payment of  
interest at Royal Bank prime plus 5%. One payment was made for $112,345.87 on  
December 5, 2015. This amount did not cover the entirety of the interest owed at that  
As such, the Lefflers are owed the remaining interest on this payment as  
well as the remaining payments totaling $200,000, plus interest contemplated under the  
Behiel’s application for summary judgment is dismissed. The Lefflers’  
application for summary judgment is granted.  
As such, I order:  
1. Judgment or damages in the amount of $300,000.00 less applicable  
payments thereon plus interest at the Royal Bank of Canada prime  
rate plus 5% per annum from August 25, 2014, until the date of  
2. Post-judgment interest thereon to the date of payment.  
3. Costs of this action payable forthwith to the Lefflers on the basis of  
Column 2 of the tariff. Such costs shall reflect the preparation of one  
expert report.  
“N.D. Crooks”  

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