Case Report – NBCA says counsel can continue to act given nature of privileged records

On July 24th, the New Brunswick Court of Appeal affirmed an order that allowed counsel who received and read privileged communications to continue to act and affirmed the part of the order that stated that counsel was not precluded from establishing the facts underlying the privileged communications.

The defendants claimed that various written statements from a witness for an adjusting firm retained by legal counsel were subject to solicitor-client privilege after they were inadvertently disclosed to the plaintiff along with a draft affidavit of documents several days before examinations for discovery. The plaintiff had thoroughly reviewed and made notes of the written communications in question by the time its counsel showed up at the discovery and was told what he had read was privileged. The plaintiff eventually destroyed the written communications, though it kept its notes and made the point that its actions were taken without prejudice to its right use information contained in the communications now destroyed.

The defendants filed a motion to disqualify the plaintiff’s counsel, but only succeeded in obtaining a protective order that required the destruction of documents and notes and prohibited use of documents. The order also specifically stated that the plaintiff was not precluded from establishing the facts underlying the privileged communications. The defendants appealed, and the third-party defendants who had not participated in the motion for fear of gaining knowledge of privileged communications filed a cross-appeal, arguing that they were now at a relative disadvantage and deserved access to the facts underpinning the privileged communications.

In dismissing the appeal and cross-appeal, the Court of Appeal stressed that solicitor-client privilege only protects communications and not underlying facts. It said:

At the end of the day, one is driven to conclude that the inadvertent production of the Documents probably operated to do no more than this: it acquainted Canada Post and Cox & Palmer with information they would have acquired, sooner or later, as the litigation unfolded. The law would be in a sad state if accelerated acquaintance with non-privileged information, in circumstances such as those that avail here, sufficed to bring about the principled removal of a solicitor of record.

Though this statement may be valid on its own, the judgement was heavily swayed by the Court’s scepticism about the privilege claim. It did not review the impugned communications (nor did the motions judge), said the motions judge’s assumption that the communications were privileged was “questionable” and that, in any event, the documents were likely “fact-focussed.”

Euclide Cormier Plumbing and Heating Inc. v. Canada Post Corporation, 2008 NBCA 54 (CanLII).