Sep 23, 2020

Searching a Member’s Home for Private Dishonesty

Law Society of Saskatchewan v Abrametz, 2016 SKQB 320 (CanLII)

It is rare for regulators to search a member’s home. However, in Law Society of Saskatchewan v Abrametz, 2016 SKQB 320 the Court held that a practitioner’s home is not sacrosanct. The Court said that “if [the member’s] argument were to prevail, it could lead to a perverse result. A member could simply insulate himself or herself from regulatory scrutiny by moving documents from the office to the home.”

In that case, the lawyer was being investigated for arranging partial payment of services outside of his firm’s accounting system as an apparent tax-avoidance scheme. The lawyer argued that the regulator had no business looking at his private financial affairs. The Court said: “the principle that regulatory jurisdiction does not stop at the office doors of the professional person in question and that a narrow view of jurisdiction is inconsistent with the broad purposive scope and mandate of the applicable self-governance legislation.”

The Court did identify two areas of possible caution for regulators. First, the Court commended the regulator in this case for giving prior notice of its intent to execute the search so that the member could challenge it first in court. Regulators may not always conclude that affording prior notice is prudent as this might provide opportunity for the tampering with evidence. Second, the Court deferred dealing with the constitutional issue of a provincial regulator enforcing a breach of a federal statute. The Court said that the disciplinary allegations, which had not yet been drafted, might involve issues of dishonesty and a lack of integrity that were different from a bare allegation of breaching a federal statute. For example, the allegations might relate to misleading the regulator or involving clients in a scheme to not declare income, which are different from an allegation of breaching the Income Tax Act.