Federal Court of Appeal – litigation database privileged, no production based on balancing

On October 20th, the Federal Court of Appeal set aside an order that required the federal Crown to disclose the field names it had used in its litigation database along with the rules used to populate the fields. It held the order infringed the Crown’s litigation privilege.

The case management judge made the order in a residential schools abuse class action. The Crown had produced approximately 50,000 documents, with many more to come. The plaintiffs sought the fields and rules (and not the data in the fields) to facilitate their review. The case management judge, though acknowledging litigation privilege, judged the fields and rules as less revealing than the data in the fields and ordered production in the name of efficient procedure.

The Court of Appeal held that the case management judge erred because they “subordinated the Crown’s substantive right to litigation privilege to procedural rules and practice principles.” It also held, “a party attempting to defeat litigation privilege must identify an exception to litigation privilege and not simply urge the Court to engage in a balancing exercise on a case-by-case basis.”

Canada v. Tk’emlúps te Secwépemc First Nation, 2020 FCA 179 (CanLII).

FCA revives longstanding test for protective orders in IP disputes

On February 17th, the Federal Court of Appeal re-clarified that protective orders ought to be granted based on the test set out in AB Hassle – i.e., when “the moving party believes that its proprietary, commercial and scientific interests would be seriously harmed by producing information upon which those interests are based.” It held that the application of the more restrictive test for confidentiality orders set out in Sierra Club was not warranted.

Canadian National Railway Company v BNSF Railway Company, 2020 FCA 45 (CanLII).

NSCA issues principled judgement on relevance standard for production and proportionality

On February 28th, the Nova Scotia Court of Appeal held that a motor vehicle accident plaintiff was not entitled to production of her insurer’s policy documents merely because she had alleged bad faith. It held that these documents might be relevant, but the plaintiff failed to meet an evidentiary burden to establish relevance. Justice Farrar explained:

Although the pleadings are a factor to be taken into consideration in determining whether documents are relevant, they are not the only factor. If that were the case, adroit counsel could draft pleadings in such a manner to allow a party to embark on a fishing expedition. This is precisely what the Rules were intended to avoid when they were amended to move from the “semblance of relevance” test to relevancy. The motions judge’s decision, in my view, reverts to the “semblance of relevance” test. Allegations, no matter how specifically worded or drafted, which have no basis in the facts or the evidence without more, cannot be the basis for a production application. This is particularly true here, where there was a dearth of evidence before the motions judge.

Intact Insurance Company v. Malloy, 2020 NSCA 18 (CanLII).

FCA articulates standard for a counsel’s eyes only order

On October 22nd, the Federal Court of Appeal affirmed a counsel’s eyes only order, affirming that such orders are available in Federal Court (despite the impact on the solicitor-client relationship) when there is a “real and substantial risk that is grounded in the evidence.” It based its affirmation on the following analysis of the facts:

The judge noted that Mr. O’Hara was the sole employee of the appellant and the driving mind behind its product development and business decisions. The judge had a well-founded concern that it would be difficult, if not altogether artificial, to expect Mr. O’Hara to completely divorce his mind from that information. Given the small and highly competitive market in which the parties both operate, this would have obvious and significant consequences for the respondents.

Arkipelago Architecture Inc. v. Enghouse Systems Limited, 2018 FCA 192 (CanLII).

Surreptitious recording of IME warrants a re-do

On December 28th, Justice Sweeny ordered a plaintiff to submit to another medical examination because he surreptitiously recorded a prior examination, commenting:

The surreptitious recording of the examination was improper. The effect of this recording is the doctor would now, most likely, be subject to cross-examination on issues as to what exactly happened in the course of the examination. The evidence of the plaintiff is also relevant. Mr. Cruz may be examined or cross-examined on the transcript. If the doctor was aware of the recording, he may have conducted his examination a different way. He may have been clearer in the language used. He may have been more specific is instructions given to the plaintiff. Much of the communication that goes on is nonverbal. The doctor was denied an opportunity to ensure that his words and conduct were being accurately recorded.

Cruz and Cruz v. Saccucci, 2017 ONSC 7737.

Court sends matter back to arbitrator to consider redaction request

On September 13th, the Federal Court of Appeal held that the Public Service Labour Relations and Employment Board was not functus officio and ought to have entertained an employer’s request to redact witness names.

The employer claimed it made an unopposed request to obscure the identities of several non-union witnesses during the Board’s hearing. When the Board issued a decision that included full names, the employer wrote the Board and asked for a correction. The Board disagreed that the employer had made a request during the hearing and held it was functus officio. The employer brought an application for judicial review, compounding the problem by filing an un-redacted copy of the decision on the Court’s public record.

The Court accepted affidavit evidence from the employer and held that it had, in fact, made an unopposed request during the hearing. Alternatively, the Court held that the Board had the power to amend its decision based on section 43 of the Public Service Labour Relations Act. The Court also ordered that its record be treated as confidential and that the applicant file new materials with witness names replaced by initials, stating, “So doing provides little, if any, derogation to the open courts principle as [the witnesses’s] identities are not germane to the decisions.”

This is an unfortunate example of (a) rising sensitivities regarding the inclusion of personal information in judicial and administrative decisions and (b) the need to be careful about it. This affair (which shall continue) could have been avoided if the parties had asked the Board to make a formal order during course of the hearing. The employer also ought to have brought a motion for a sealing order at the outset of its judicial review application, before filing un-redacted materials (a point that the Court made in its decision).

Hat tip to Ian Mackenzie.

Canada (Attorney General) v Philps, 2017 FCA 178 (CanLII).

“Steep hill” to climb for defamation plaintiffs when suing on matters of public interest

On July 25th, the Ontario Superior Court of justice dismissed an action under a new provision of the Ontario Courts of Justice Act intended to dissuade persons from bringing “strategic lawsuits against public participation” – so called “SLAPP” suits.

The plaintiff is a company that operates a gravel pit. It sued a Stouffville teacher who made two postings to Facebook about a municipal approval that allowed an expansion of the company’s operation. The defendant made the posts without reading the engineering report the plaintiff had filed with the municipality or taking any other significant steps to inform herself of the issue. She said the defendant would profit significantly from the approval, the municipality would not, and the defendant “would potentially poison our children.” When the plaintiff demanded an apology, the defendant apologized. The plaintiff sued anyway.

The plaintiff agreed that the defendant’s expression related to a matter of public interest – leaving the plaintiff to establish that its proceeding had “substantial merit,” that the defendant had “no valid defence” and that it had suffered (or was likely to suffer) “sufficiently serious harm” in order to survive dismissal under the CJA’s anti-SLAPP provision. The Court held that none of these criteria were met, dismissed the action and awarded $7,500 in damages to the plaintiff (in part reflecting how the plaintiff conducted its proceeding and in part reflecting the defendant’s failure to adduce medical evidence in support of her damages claim).

The judgement means that the burden on a party seeking civil redress for statements made about a matter of public interest is high. In this case, for example, it did not matter that the plaintiff took few steps to inform herself of the issue or used the “unfortunate” word “poison”; informed or not, the Court said the plaintiff had a right to enter the public forum and use emphatic language in doing so without the risk of being sued. Justice Lederer explained:

I am inclined to the view that the legislature did more than just “tilt the balance somewhat”. Rather the legislature created a steep hill for the plaintiff to climb before an action like this one is to be permitted to proceed. The legislation directs that we place substantial value on the freedom of expression over defamation in the public sphere. To put it simply, those who act in the public realm need to realize that not everybody will accept what they wish to do or agree with what they say and may make statements that go beyond what may seem, to the recipient, to be appropriate.

United Soils Management Ltd. v. Mohammed, 2017 ONSC 4450.

NLCA holds that implied undertaking does not apply to medical report

On December 21st the Newfoundland and Labrador Court of Appeal held that the implied undertaking does not apply to a medical report produced in a related personal injury action.

The plaintiff was injured in a motor vehicle accident and submitted to an examination in his action against the driver. That action settled, but the plaintiff continued a separate action against his own insurer for disability benefits, which prompted the insurer to seek the report. The Court commented:

In this case, it is difficult to see how the implied undertaking rule is engaged. A medical report, being factual in nature, would be neutral insofar as encouraging the provision of complete and candid discovery, one of the rationales for the rule. Further, the proposition stated by Binnie J. [in Juman v Doucette] that “whatever is disclosed in the discovery room stays in the discovery room” loses its impact and relevance when considered in the context of the factual nature of medical reports and the operation of rules 31 and 34.

The Court also held that the undertaking – implicit rather than express in Newfoundland – is “overridden” by the provisions of the Newfoundland Rules of the Supreme Court that favour production of medical reports.

Unifund Assurance Company v Churchill, 2016 NLCA 73 (CanLII).

SCC says PIPEDA does not constrain a court’s procedural power

The Supreme Court of Canada decided the case of RBC v Trang this week. It held that the Personal Information Protection and Electronic Documents Act does not limit the procedural powers of a court. If a court, based on analysis that is not at all governed by PIPEDA, decides that an order to disclose personal information is warranted, it may issue the order. The order may be complied with notwithstanding PIPEDA.

Here is the ratio in Trang:

As a result of s. 7(3) , PIPEDA does not diminish the powers courts have to make orders, and does not interfere with rules of court relating to the production of records. In addition, PIPEDA does not interfere with disclosure that is for the purpose of collecting a debt owed by the individual to an organization, or disclosure that is required by law. In other words, the intention behind s. 7(3) is to ensure that legally required disclosures are not affected by PIPEDA.

All is right in the world again after the Ontario courts got quite twisted up on a very fundamental question about PIPEDA’s impact on the civil justice system.

The Court also held that debtors implicitly consent to the disclosure of mortgage status information (current balance) to judgement creditors who are seeking to recover a debt. This creates an opportunity for banks to assist judgement creditors without requiring them to obtain a court order. (Might the Court have had the burden of pro forma motions in mind?)

More generally, the Court supported a very flexible, fully-contextual implicit consent standard. This arguably erodes privacy protection and invites uncertainty, but also allows for just and sensible outcomes despite a consent rule in PIPEDA that is otherwise quite strict. Of course, this will feed the current dialogue about whether consent is a meaningful principle by which to govern the protection of personal privacy.

Royal Bank of Canada v. Trang, 2016 SCC 50 (CanLII).