Retired Supreme Court of Canada justice Ian Binnie is leaving the cloistered world of Canada’s top court to return to a profession he barely recognizes and to practise law in a shifting legal landscape where costs are spiralling and the commercial courts are in danger of being less relevant.
“The profession has changed enormously in the 14 years that I have been away, there have been huge shifts,” he says, furrowing the brow of his thin, bird-like face into a deep frown.
His biggest concern is the “corporatization” of the country's major law firms, which are shifting the practice away from diverse partnerships to specialized partnerships filled with lawyers, politicians and other advisers focused on landing lucrative big business clients. The other potentially troubling change is the rapid growth in private arbitration of corporate contract disputes, a development which threatens to “impoverish” courts' access to important business cases.
After a mandatory six-month hiatus following his Supreme Court retirement in October, Mr. Binnie, who turns 73 this week, is joining Lenczner Slaght Royce Smith Griffin LLP, a Toronto litigation boutique founded by partners from his former firm, McCarthy Tétrault LLP.
He will split his time between Lenczner Slaght and work at a new Toronto arbitration centre. The second job teams him with four judges and litigation experts, including Yves Fortier and Tom Heintzman, who will preside over private corporate-contract disputes.
During a three-hour interview at his country home near Lindsay, Ont. – a session that begins with a root vegetable soup and roasted ham prepared by wife, Susan, and is interrupted by a steady queue of giggling grandchildren – Mr. Binnie gives notice that he very much wants back into a profession that now worries him.
While he is eager to return to the “adrenalin rush” of litigation that he missed during the “much greyer existence” of a Supreme Court judge, he is frankly dismayed by the “corporatization” of law firms.
These legal behemoths, he says, are “festooned like Christmas trees” with former politicians, specialized lawyers and other professionals who are fixated on “ingratiating themselves” with big business clients. Salaries and legal costs have become so outsized that lawyers now earn more than many of their clients, something he did not imagine when his career began in the 1960s.
“I don’t identify with the schmoozing aspect of law firms,” he says. “Big firms have evolved into something quite different than what I am used to, so I am voting with my feet by going [to Lenczner Slaght] They are survivors of an older era; all they do is advocacy.”
The paradox of Mr. Binnie’s latest career move is that he will have one foot in traditional litigation and the other in alternative dispute resolution, known as arbitration, an area that he worries could “balkanize” the legal system.
Businesses are flocking to arbitration because it sidesteps slow courts and generalist judges who are sometimes poorly informed about complex and specialized business issues such as patent, finance and other contract disputes. This judicial fast track is expensive, allows parties to hand-pick the arbitrators (often former judges and top-ranked lawyers) and results in rapid decisions that are seldom eligible for appeals to higher courts.
The problem with the swelling arbitration pipeline, Mr. Binnie says, is that disputes are settled privately, depriving the legal system of cases and decisions that feed the courts and the development of law.
“The movement to arbitration … becomes its own universe of legal thinking that slowly detaches itself from the court system,” he explains.
“One of the most interesting aspects of being on the Supreme Court was to see how quickly the law was changing under our feet. Issues were being decided with new approaches and the law is forever being modified. For that modification to take place, there has to be this steam of nutrients flowing up,” he says.
“When that stream is impaired – as it is by taking work out and giving it to alternative dispute resolution – then the work at the top suffers because the judges are not exposed to the same range of problems, with the same depth and the same frequency.”
Without timely and relevant cases, Mr. Binnie says, it becomes more difficult for judges to sculpt meaningful decisions. As an example, he cites his involvement in one of the most high-profile business disputes of the decade: the appeal by bondholders to stop the $35-billion takeover of BCE Inc. in 2008. At the heart of the case was a claim that BCE’s directors had breached their duties by approving a debt-heavy takeover that would sharply diminish bond values.
The Supreme Court’s decision, which went against bondholders and disappointed legal observers because of its limited clarity, “was built on a decision that had been handed down years before,” he says. The case dated back to 1994 when stakeholders claimed that the board of an insolvent retail chain, Peoples Department Stores Inc., had improperly favored the company’s founders.
The court system’s best hope for attracting more commercial cases, he says, is to speed up the notoriously slow pace. In the United States, judges at the leading corporate court, the Delaware Court of Chancery, and local district courts, have much tighter control of their case dockets, which makes it more difficult for plaintiffs and defendants to file frivolous motions.
“Delaware is famous for taking cases by the throat and banging them until they get a quick result. For that reason and a few others, businesses flock to Delaware.”
In Canada, lawyers can file motions to a variety of judges and magistrates, triggering delays, additional costs and “procedural injustices.” One British Columbia homicide case that went before the Supreme Court during his tenure had been bogged down by 130 pretrial motions.
“It is hard to see how you can spend 130 days before you can even get to trial,” he says. “Justices recognize that greater control has to be exercised over these disputes so that the effort and time is proportional to the dispute.”
Another challenge, Mr. Binnie says, is limited court resources. Although the federal government invested in computer systems and other technological advances at the Supreme Court to convert all factums and decisions into digital documents that are publicly available on the court’s website, most Canadian judges must sift through boxes of printed documents to study their cases.
“The justice system is always a bit of a poor cousin in the budget cycle. The justice program could be advanced enormously by a relatively small amount of money that it doesn’t get.”
THE OUTSPOKEN IAN BINNIE
On the early days of his career with Wright & McTaggart:
In the old days, clients had a marvellous inertia. You really had to mess up big time before you got fired. Now they will walk across the street because they get a slightly better deal on the rates.
On what he misses most about that time:
The Honeydew restaurant on Adelaide and York Streets. At 10 a.m. every morning, half the bar was having coffee and chatting. There were no issues about civility then because the person you were tempted to scream at today is the person you would be having coffee with tomorrow.
On the legal potential for a national securities regulator now that the Supreme Court has rejected the federal government’s bid:
I was part of the court that decided the securities reference. There is nothing I can add to what was said there, but my wish is that more commentators would actually read the decision instead of simply the outcome. They will find in that decision a large part of the answer to your question.
On the billion-dollar bets stock traders were making based on their interpretation of the questions Mr. Binnie was asking during a dispute between BCE and its bondholders:
I thought it was a product of a colossal lack of understanding of how the court works to think that, if a judge sounds aggressive, he must be leaning toward a defendant.
On how the Department of Justice has changed since 1986, his last year as associate deputy minister.
“Senior staff used to stay for decades, creating an institutional continuity that was phenomenal. Now the model is you bring young people in and they stay for a few years. … That is going to be an increasing problem because Ministers seem to have the view that all they have to do is phone Bay Street, send down the file and get an opinion. … Bay Street doesn't … have this vast amount of knowledge that was handed from lawyer to lawyer. In the end, the government is the big loser because they need that kind of objective, experienced viewpoint.”
Bachelor of arts, McGill University.
LL.B, Cambridge University, England.
LL.B, University of Toronto.
1967-1982: Wright & McTaggart
1982-1986: Associate deputy minister of justice, Canada.
1986-1998: McCarthy Tétrault.
1990: Special parliamentary counsel to joint Senate and House committee on Meech Lake Accord.
1998 to 2011: Justice, Supreme Court of Canada.