All About Information

On November 30th, the Federal Court dismissed a federal Access to Information Act application about the application of the solicitor-client privilege exemption. Notably, Montigny J. made the following comment about the confidentiality of draft documents:

The Supreme Court also held in Blank, supra, that there is often a potential for overlap of legal advice privilege and litigation privilege in the litigation context. Legal advice privilege may continue to apply to material to which litigation privilege no longer attaches (Blank, at para. 49). I have found that there are several examples of this kind of overlap in the case at bar. This is true, in particular, of draft court documents or submissions. These draft documents remain protected by legal advice privilege under s. 23 of the Act even though the final version of these documents may have been released once the litigation privilege that applied to them had come to an end. Draft court documents, while being drafted, represent an interchange between solicitor and client, wherein the solicitor provides the client with direction or options as to the legal position to be taken in pending litigation. The client, in turn, comments on that legal advice, provides further instructions, and so forth. Draft court documents and submissions are, by their very nature, intended to be confidential. It is only the final version that is filed with, or submitted to, the court that is not so intended. The draft court documents or submissions clearly satisfy the three criteria set out in Solosky, supra, for legal advice privilege.

This reasoning has general significance to the law of solicitor-client privilege. It is also relevant to exemptions such as the government advice exemption in Ontario freedom of information legislation. The IPC/Ontario, I believe, has taken the position that draft records do not reveal “advice” and are therefore not exempt from public access.

Blank v. Canada, 2009 FC 1221.

On October 9th, the British Columbia Court of Appeal held that the privilege in section 517(5) of the Canada Elections Act is not a bar to production.

The section deems the fact that a person entered into a compliance agreement and any statement in a compliance agreement that admits responsibility for a violation of the Act to be inadmissible as evidence. The Court held that the provision only deems evidence to be inadmissible and does not bar production. It also held that the information, in the circumstances, was not subject to litigation privilege.

Ontario courts have read the statutory privilege governing an Ontario Student Record similarly. See, for example, the McNeil case.

Lougheed Estate v. Wilson, 2009 BCCA 438.

On September 3rd, the Ontario Superior Court of Justice dismissed a motion to disqualify counsel who received allegedly privileged e-mails and used them to amend its pleadings. It held that the privilege holder had waived privilege either knowingly or through the reckless conduct of its counsel.

The privilege dispute arose in the context of a wrongful dismissal claim and a counter-claim brought against a departing plaintiff. The plaintiff had communicated with her legal counsel by e-mail on her former employer’s system. The employer’s American counsel retrieved the e-mails and turned them over to its Canadian counsel, who produced twelve suspect e-mails to the plaintiff in September 2007 along with 135 other documents. The next day, the employer’s counsel wrote a one page letter to the plaintiff’s counsel to deal with a number of production issues and expressly took the position that privilege in the e-mails had been waived.

The plaintiff objected to the production in May 2009. This was after its counsel had responded to all points in the one page letter except the privilege issue and had sought a further and better affidavit of documents. It was also after the defendant retained new counsel who assumed the plaintiff had accepted its privilege waiver position and sought to amend its pleadings to refer to the solicitor-client communications in November 2007.

On these facts, Master Glustein held that the plaintiff had waived privilege. He also held that he would not have otherwise disqualified the defendant’s newly-retained counsel, who he said was blameless in proceeding with its understanding that privilege had been waived. Master Glustein did not consider whether the plaintiff waived privilege in her communications by using her employer’s e-mail system, but did comment:

I also find no “blame” in CPL going through Eisses and Fava’s emails at the outset. Even if the Emails are privileged, CPL’s counsel (Miller and Blakes) believed that the Emails were not privileged because they were the employer’s documents, and that as such, Eisses waived privilege. In any event, CPL and Blakes did the right thing by immediately and explicitly advising Colson, at the outset of the production process, that CPL had produced solicitor-client communications on which CPL claimed Eisses waived privilege.

This obiter statement is of some interest given the frequency with which employers find themselves in custody of their former employees’ solicitor-client communications. The case is otherwise driven by its facts.

Eisses v. CPL Systems Canada Inc., 2009 CanLII 45440 (ON S.C.).

On June 12th, the Divisional Court issued a decision in which it held that documents protected by settlement privilege are exempt from public access under the Ontario Freedom of Information and Protection of Privacy Act. This finding is of consequence itself, but the purpose-driven means by which the Divisional Court reached its secrecy-favouring finding are very significant.

The facts in the case are simple. The LCBO denied access to various records related to a mediated settlement of a number of civil proceedings between itself and a winery. The LCBO relied on the “solicitor-client privilege” exemption in section 19 of FIPPA. This exemption has two branches. Branch 1 exempts records that are subject to solicitor-client privilege and litigation privilege as these privileges are conceived at common law. Branch 2 exempts records that are “prepared by or for Crown counsel for use in giving legal advice or in contemplation or for use in litigation.”

The requester appealed to the Information and Privacy Commissioner/Ontario, who held that Branch 1 of section 19 does not exempt records that are subject to to settlement privilege from public access. The IPC also held that the LCBO did not prove that the records were exempt under Branch 2 of section 19 because, having not submitted affidavit evidence, the LCBO had not proved its stated intention to use the records in litigation should the mediation have failed.

The Divisional Court held that the records were exempt because they were subject to settlement privilege and because they fit within the Branch 2 exemption.

The first finding is very remarkable because the Court relied on FIPPA’s purpose provision rather than any one of the sixteen enumerated exemptions in FIPPA. In effect, the Court created an implied exemption from public access. It stated:

I conclude that the public policy interest in encouraging settlement as embodied in the common law concept of settlement privilege trumps the public policy interest in transparency of government action, in the circumstances of this case. I turn, then, to analyze this conclusion within the context of the indicators of legislative meaning proposed by professor Sullivan.

This interpretation is plausible because it complies with the legislated text (s. 1(a) of FIPPA) which provides for “necessary exemptions” that are “specific and limited.” The exemption is “necessary” to maintain confidentiality of negotiated settlements. The exemption is “specific” and “limited” in that i is specific to and limited by the circumstances of this case. A case-by-case analysis ensures settlement privilege will always be specific to and be limited by particular fact situations.

This interpretation is efficacious because it promotes the legislative purpose of creating exemptions where necessary, provided the exemptions are limited and specific.

This interpretation is acceptable because it leads to a conclusion that is both reasonable and just. As noted earlier in these reasons, no party would willingly entertain settlement discussions with a government institution if it knew its confidential settlement discussions would be made public. This is particularly so where admissions would be made and concessions offered that would be detrimental to that party. If required to discuss settlement by the Rules, those discussion would not, I suggest, be meaningful.

The Court also held that Branch 2 of section 19, interpreted purposely, ought to exempt materials otherwise subject to settlement privilege as a class. It said:

The LCBO asserted before the IPC that the mediation materials were intended for use in litigation should the mediation fail. The IPC refused to consider this because of a finding that there was no evidence to this effect. It is unnecessary for me to resolve this dispute, other than to say it is obvious that some materials used in any mediation will subsequently be used to prepare for trial and at the trial itself…

The wording of Branch 2 imposes no temporal limits on the protection provided nor limits it to particular types of litigation documents, nor specifies specific steps in the litigation. Nothing in the legislative text suggest that the term “litigation” should be given a different mening than that adopted by the courts and reflected in the Rules [of Civil Procedure]. Such an interpretation complies with the legislative text.

Such an interpretation of Branch 2 also promotes the purpose of FIPPA to provide transparency of government functioning “with exceptions where the interests of public knowledge are overbalanced by other concerns” (see Big Canoe (C.A.) above). To interpret Branch 2 in this manner recognizes that in the case of records prepared by or for Crown counsel for use in any aspect of litigation, the interests of the public in transparency are trumped by a more compelling public interest in encouraging the settlement of litigation.

The Court’s protective outlook is very atypical and will certainly be of great concern to the IPC and open government advocates. There’s also some dicta in the decision that reveals a significant subtext.

What flows from the IPC’s view of the law regarding settlement negotiations? First, the details of negotiations and settlement of any dispute between a government institution and a third party will be available to the world at large, following a request. Apparently, a Requester need but ask anonymously and the IPC will undertake the heavy lifting, as in this case. There is a delicious irony in this matter, whereby the IPC, in the name of transparency, labours for an anonymous Requester.

Ontario (Liquor Control Board) v. Magnotta Winery Corp., [2009] O.J. No. 2980 (Div. Ct.) (QL).

The British Columbia Court of Appeal has recently published a June 11th oral judgement on an implied waiver of privilege claim and a motion for production of non-party documents.

On the implied waiver claim, the Court held that a pleading by a plaintiff that alleged it would not have entered a settlement agreement had it known about certain fraudulent conduct did not give rise to an implied waiver of solicitor-client privilege in communications related to the settlement. It stressed that a mere allegation as to a state of affairs on which a party may have received legal advice does not warrant setting aside solicitor-client privilege.

On the affirming the chambers judge’s refusal to order production from a non-party, the Court stated, “A chambers judge has a discretion to refuse production of documents that are of marginal relevance where other documents relevant to the same issue have already been produced: see Peter Scherle Holdings Ltd. v. Gibson Pass Resort Inc., 2007 BCSC 770.”

Procon Mining & Tunnelling Ltd. v. McNeil, 2009 BCCA 281.

I presented at an OBA privacy conference back in early June but held off posting a short paper I wrote for it entitled, “Employer access to employee e-mails in Canada.” The paper argues that there are signs that the traditional “no expectation of privacy” approach to addressing employer access to employees’ stored communications is waning, leaving employers with a choice between giving clearer notice to employees or, alternatively, implementing purpose-based controls to protect employee privacy.

This is a hot topic north and south of the border, and was so even before the Superior Court of New Jersey Appellate Division issued its much discussed decision in Stengart v. Loving Care Agency on June 26th.

Stengart is about whether privilege is waived in solicitor-client communications that are stored on an employer’s system. Our own leading case on this issue is Daniel Potter, which suggests that privileged communications made by employees on employer systems deserve greater protection than other “private” employee communications. Despite this distinction, the reasoning in Stengart is very broad, very pro-privacy and is further reason for employers to pay heed to the issues I raise in my paper.

For a copy of the full paper, please click here. And please feel free to contact me or comment below with your feedback and ideas.

Today, the Ontario Court of Appeal allowed an appeal of a noteworthy case about breach of privilege by the Crown.

The case involves an investigation report prepared at the request of external legal counsel after a critical injury for which Occupational Health and Safety Act charges were ultimately laid. An employee who was given a draft of the report on the undertaking he destroy it gave a copy to the Crown. This was after the company had asserted privilege to the Ministry inspector, who had agreed not to order the report’s production.

When the Crown disclosed the report to the company in its Stinchcombe production the company immediately objected, and at trial moved before a justice of the peace for a declaration (that the report was privileged) and a stay. It initially succeeded in obtaining a declaration, a stay and an order for $38,000 in legal costs. On appeal to a judge, the Court overturned the stay and the costs order. It held that the proper remedy for breach of the defendants’ section 8 rights was an order excluding the report and that the motion for a stay based on prejudice to trial fairness was premature.

In allowing the appeal, the Court of Appeal started by minimizing a statement made by the justice of the peace about the reporting being “primarily informational.” It held the lower court had found the report was subject to solicitor-client privilege and that this point was not challenged in the appeal.

The Court of Appeal then held that the presumption of prejudice endorsed by a majority of the Supreme Court of Canada in Celanese applies when the Crown comes into possession of a defendant’s solicitor-client communications:

Counsel for the Crown in this court sought to distinguish Celanese on the basis that it was a civil case in which the appellants were “attempting to utilize a civil onus to achieve a criminal result”. I reject this submission. In my view, the above cases support the proposition that when the Crown comes into possession of a defence document that is protected by solicitor-client and litigation privilege, prejudice to the defence will be presumed. The presumption, however, is rebuttable.

On the facts, the Court of Appeal held that a stay was the appropriate remedy. The basis for the finding is narrow. It stressed that the justice of the peace had made a specific finding that the report set out items that could be used to the disadvantage and prejudice of the defendants and held that the Crown had not led any evidence about its distribution and use of the report to rebut the inference.

R v. Bruce Power, 2009 ONCA 573.

Here are my recent links of note from June 22nd.

If you’re interested in the law relating to corporate e-mail systems, be sure to check out Stengart v. Loving Care Agency Inc., linked through the fifth bullet below. It’s a New Jersey case about whether an employee waived privilege in solicitor-client communications by sending them through a personal internet-based e-mail account on a work computer. The e-mails were recovered by the employer, who claimed it could use them in post-employment litigation with the employee. The Court makes some extremely strong statements against employer control over “personal” communications on work systems – some of the strongest I’ve read.

I find the reasoning in Stengart troubling, but am withholding an opinion pending further thought. What’s immediately remarkable to me, however, is how value-laden these e-mail judgements are. Try reading the Alberta Court of Appeal’s recent Poliquin decision and Stengart back-to-back and you’ll see what I mean. This is not good in my view. As a management side advisor and advocate I’m not inclined to promote the enactment of privacy legislation, but if we are going to have enforceable privacy rights, enacting good and balanced privacy legislation might be a way to make such rights understandable. Without predictability, policy-making will be difficult and litigation of reasonable positions might be prohibited by risks that cannot be controlled. These thoughts to be continued at a later date.

• Liked Mike Fitzgibbon’s Summary Judgement in Employment Disputes: http://bit.ly/PHB7y
• RT @marciahofmann: Associated Press imposes strict social networking policy on staff. http://bit.ly/141mCZ (via @dmkravets) [Thank you!]
• Editing Tip: Spell Out Numbers One to Ten, and Don’t Repeat Them in Parentheses: http://bit.ly/6yVHD [Via @eschaeff]
• RT @sectorprivate Some Professors’ Jitters Over Twitter Are Easing http://tinyurl.com/ktxwrq [Thanks Greg!]
• RT @nggauthier The Perils and Promise of the New Jersey Workplace Privacy Ruling: http://bit.ly/U2Kif
• NYT editorial on college binge drinking: http://bit.ly/19J7N7
• RT @PrivacyLaw “Lawsuit against Jefferson County Public Schools” http://tinyurl.com/mf358p
• The Ann Arbour Chronicle argues for e-FOI:http://bit.ly/viW4J
• RT @PrivacyLaw: “Canadian gov’t: you have no expectation of privacy on the Internet” http://tinyurl.com/m5scnk

On a personal note, Seanna and I are new parents of Penelope Green Robinson. She was born two days ago and is very healthy. “Green” is from Joni Mitchell’s song “Little Green” – a lovely (though sad) song about a mother’s love for child. Here’s a pic of PG and her brother Bug, who has been very welcoming. As for me, I’m feeling very grateful for my family and for the wonders of life.

See ya!

Dan

I was at the Osgoode PDP Electronic Evidence seminar today. There were great presentations all around, and I’ve included my notes at this Twitter feed. I was very honoured to co-present with John Gregory, whose knowledge of electronic evidence issues is deep. Our presentation is really about the law of e-mail, with a mix of content on access to e-mail on corporate systems, e-mail production and e-mail admissibility and weight. Here are the slides.

We also provided a handout with case citations and a summary sheet on the CGSB Standard on Electronic Records as Documentary Evidence.

I hope this is useful!

I just read Universal Sales, Limited v. Edinburgh Assurance Co. Ltd., a November 2008 judgement of the Federal Court that deals with inadvertent disclosure of solicitor-client communications.

The case is about a transcript of a telephone conversation containing solicitor-client communications that was inadvertently produced to an opponent in litigation. The judgement has a nice summary of the law on inadvertent disclosure of privileged information:

As the Plaintiffs point out, the mere physical loss of custody of a privileged document does not automatically end privilege, especially in the context of modern litigation where large quantities of documents, such as the electronic production of a CD in this case, are exchanged between counsel and accidental disclosure is bound to occur from time to time.

In cases of inadvertent disclosure, the waiver question turns more on the conduct of the privilege holder after it discovers its disclosure and also on any special prejudice that might be faced by the recipient (e.g. by bona fide reliance that does not conflict with any professional duty to immediately seal the communication).

I found Universal Sales in preparing to make some comments on whether employees waive privilege when they communicate with their solicitors on employer e-mail systems at today’s Osgoode PDP program on electronic evidence. The question is whether the waiver is intentional as opposed to inadvertent and will turn on the facts. The most authoritative Canadian case on the issue is the Daniel Potter decision by Mr. Justice Scanlan of the Nova Scotia Supreme Court.

Scanlan J. found that the CEO of a company had not waived privilege by sending solicitor-client communications through his employer’s computer system. He did consider argument based on the employee privacy cases (see my last post), but held that solicitor-client communications deserve special treatment. He also noted, however, that Mr. Potter was CEO and had “day to day executive control over policies which may have threated his expectation of privacy.”

My view on the issue is (1) that Daniel Potter does not close the debate, (2) that Canadian courts will demand very special facts to find waiver because they are staunch defenders of solicitor-client privilege and (3) the occasions when it makes tactical sense to engage in a dispute over the waiver issue are likely rare.

Looking forward to speaking to this later this morning. I’ll live blog the event at #oseev and @michaluk_live.

See ya!