Nunavut court: Former Horne sex abuse victims sue their lawyers

Ed Horne leaves the Iqaluit courthouse after a January 2008 court appearance in relation to a series of charges for which he was eventually found not guilty. Though his sexual abuse of Nunavut children ended 30 years ago in 1985, Horne’s actions in the 1970s and 1980s continue to generate pay cheques for lawyers. (FILE PHOTO)

Thirty-two Nunavut Inuit who shared part of a $15.5 million compensation award for sexual abuse they suffered at the hands of the notorious ex-teacher, Ed Horne, are now suing the lawyers who won that settlement for them.

In a statement of claim filed this past Aug. 19 by their lawyer, Alan Regel, at the Nunavut Court of Justice in Iqaluit, the sexual abuse victims allege that lawyers Geoffrey Budden and Stuart Morris improperly withheld small amounts of settlement money from each of the 32 claimants.

None of the claims made in the lawsuit have been proven in court. Budden and Morris have yet to file a statement of defence.

The lawsuit does not specify how much money the claimants seek to recover and exactly how much they seek in punitive damages.

But they allege that even if Budden and Morris improperly withheld only small amounts from each individual client, the total amount — all 32 claimants added together — is large.

So while in each individual case, the amounts are too small to make it worthwhile to try to recover the money through individual court actions, grouping them all together creates a strong case for punitive action by the court, the statement of claim alleges.

“The Defendants, however, by taking [a] small amount from each member of such a large group acquired a significant financial gain that was unlikely to be recovered,” the statement of claim said.

To that end, the lawsuit seeks “significant punitive damages.”

That, the lawsuit said, is “to ensure others tempted by the lure of significant financial gain in similar circumstances do not engage in similar misconduct,” and that the court should “denounce and deter” such alleged actions.

The 32 plaintiffs are part of a group of 66 people who filed the second of two lawsuits against the governments of the Northwest Territories and Nunavut, claiming damages produced by Horne’s sexual molestation of young Inuit students, nearly all of whom were boys.

Budden and Morris filed the second Horne lawsuit, known as “Horne II,” in 2004.

The claimants in this lawsuit were not part of the first lawsuit filed against the GN and the GNWT for damages inflicted by Horne’s sexual abuse.

In that one, 82 men shared a $21.5 million settlement reached in October 2002 in an alternative dispute resolution process.

But in the second lawsuit, the GN and GNWT took a hard line, and it appeared as if the two territorial governments were willing to force Horne’s sexual abuse victims to testify in a trial.

At one point in 2009, Budden threatened to use documents that contained evidence — damaging to the reputations of various territorial education officials and teachers’ union officials — that is alleged to reveal attempts by government and union officials to cover up Horne’s sexual abuse of children in the 1970s and 1980s.

All this suggests the Horne II case took far more time and money to settle than Horne I.

In 2011, after difficult, protracted wrangling among lawyers in and out of court, the GNWT and the GN agreed to pay a $15.5 million settlement.

That money would have gone towards paying Budden and Morris’s legal fees and court costs, with the rest being divided among the 66 Horne II plaintiffs.

The funds intended for the sexual abuse victims were held in trust. Some received lump sum payments, while many opted for “structured settlements,” where money was invested for them to be paid out later.

The Horne II settlement agreement, and other documents related to the case, have been sealed by the court. That means the precise terms of the agreement are not available to the public.

However, the claimants allege that Budden and Morris agreed to be paid no more than 33.33 per cent of the proceeds from the settlement — but that they took more.

Those allegations include claims that:

• Budden and Morris did not replace lost or misplaced cheques;

• Budden and Morris charged their clients for things they weren’t supposed to, such as office overhead costs and law society membership fees;

• Budden and Morris withheld some payments to some of their clients; and,

• Budden and Morris failed to “fully and properly” account to their clients for money owed to them and refused to properly explain how the settlement money was disbursed and handled.

They also allege that Budden and Morris had each of their clients sign documents called “Contingency Fee Retainer Agreements,” or CFAs.

Those documents set out how the lawyers would be paid following a settlement agreement.

But the lawsuit alleges those agreements were incomprehensible to the former students and that Budden and Morris “took advantage of their superior knowledge of the English language and their legal knowledge, skill and ability to persuade the plaintiffs to sign the CFAs without fully understanding them.”

In his lawsuit, Regel also alleges that Budden and Morris did not file the CFAs, in breach of the rules of court.

For that, and other reasons, the CFAs are invalid, the lawsuit claims.

The 32 claimants are people who Budden and Morris would have visited in 2003 and 2004, after more of Horne’s alleged victims came forward to demand compensation and after the first settlement agreement was announced in 2002.