A grossly unfair allocation amounts to an error of principle in an assessment of a lawyer's account

Merovitz-Potechin LLP v. Middleton, 2011 ONSC 1214 is a very current statement of the law regarding an appeal from an assessment officer:

[11]           Both counsel in their clear and concise submissions agreed on the applicable standard of review.  On an appeal from the taxing officer, the Court is only concerned with questions of principle and not with mere questions of amount, or the manner in which the taxing officer has exercised his discretion, unless the amounts are so inappropriate or the taxing officer's decision so unreasonable as to suggest an error in principle. 
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[19]           There is no doubt that the thrust of this appeal is on the quantum of the reduction applied to the solicitor's account by the Officer.  The principle applicable in this type of situation was well put by E. MacDonald J. of the Ontario Court of Justice (General Division) in the case of Dical Investments Ltd. v. Morrison (1993 CarswellOnt 378, 13 C.P.C. (3d) 305).  At paras. 30 to 32 of that decision the following appears:

30.  Perhaps most importantly in respect of this appeal is the principle that a certificate from an assessment officer on a question of quantum should only be interfered with at the appellate level if it can be shown that the amounts allowed were grossly unfair against conscience or constitute the grossest kind of mistake.  The mere fact that the appellate court might have arrived at different amounts if it had been assessing the bill does not matter and does not constitute sufficient grounds for interference:  Willowrun Investment Corp. v. Greenway Homes Ltd. (1987), 21 C.P.C. (2d) 129 (Ont. H.C.) at 142.
 
31.  The overall approach taken by the registrar in my view was proper and reasonable and does not constitute gross mistake with the result that it is not appropriate for this court to interfere with the rulings of the registrar in respect of the quantum of accounts.
 
32.  On an appeal from an assessment the appellate court must only be concerned with questions of principle and not with questions of the amount or the manner in which the assessment officer exercises his discretion.  The appellate court possesses a general jurisdiction over the assessment officer to prevent wrong to the parties, but where there is no mistake in principle and where the sum awarded is not so grossly large or small as to be beyond all question improper, the appellate court must not interfere with the discretion of the assessment officer.  See Willowrun Investment Corp. v. Greenway Homes Ltd. referred to supra, at p. 130.  This court finds no error in principle that should be corrected nor does this court find anything which would constitute valid grounds for referring the matter back to the assessment officer for rehearing.
 
 
[20]           It is my view that while the Hearings Officer was correct in apportioning responsibility for the abundance of time spent on this case, apportioning so much of the responsibility to the solicitor on the facts was grossly unfair.  As outlined above, the Officer quite properly found that there were failings by both the client and the Respondent that led to the ultimate situation.  He then, however, penalizes the solicitor by reducing his account by almost sixty-five percent.  That in my view was not proportionate to the competing behaviours as outlined in the evidence and in his Reasons.  It is also relevant that the client, because the $50,000 in costs awarded after the Trial is a credit against the assessment of fees in the amount of $70,000, is left to pay a net amount of $20,000 plus GST and disbursements, while the solicitor's loss on the basis of the present assessment reduces his account by $126,000.