SCC Upholds Solicitor-Client, Litigation Privilege in Recent Rulings
November 28, 2016
In two decisions released on November 25, 2016, the Supreme Court of Canada (SCC) affirmed the fundamental importance of litigation privilege and solicitor-client privilege. In Lizotte v. Aviva Insurance Company of Canada (Lizotte), the SCC dealt with issues relating to the breadth of litigation privilege and confirmed that it exists as a stand-alone privilege under Quebec law, while in Alberta (Information and Privacy Commissioner) v. University of Calgary (Alberta), the SCC dealt with issues relating to the sanctity of solicitor-client privilege. In each case, the SCC emphasized that such privileges may be abrogated only by statute where there is clear, explicit and unequivocal language indicating that abrogation of the privilege was the legislative intent.
In the course of an inquiry into an insurance claims adjudicator, the assistant syndic of the Chambre de l’assurance de dommages (Chambre), the Quebec self-regulatory body that oversees the conduct of insurers, asked Aviva Insurance Company (Aviva) to produce a complete copy of the claim file with respect to an insured. This request was made pursuant to section 337 of the Act respecting the distribution of financial products and services (ADFPS), which creates an obligation for the insurer to produce any document concerning the activities of a representative whose professional conduct is being investigated by the Chambre. Aviva refused to produce certain documents on the basis of litigation privilege, given ongoing litigation involving the insured. The Chambre syndic brought a motion to obtain the documents on the basis that the production obligation set out in section 337 overrides litigation privilege. Before the motion was heard, the litigation between the insured and Aviva settled, and Aviva produced the documents. However, the syndic proceeded with its motion, and the Superior Court found this was a “genuine problem” worth deciding.
Both the Québec Superior Court and Court of Appeal ruled in Aviva’s favour, finding that litigation privilege cannot be abrogated absent an express provision.
The SCC agreed. Importantly, Justice C. Gascon for the SCC clarified that the differences between solicitor-client and litigation privilege identified in Blank v. Canada (Minister of Justice) have been adopted in Quebec law, and litigation privilege is not merely a subcategory of civil law professional secrecy but a stand-alone privilege. Justice Gascon went on to make three important comments about litigation privilege:
- Litigation privilege is a class privilege. As a class privilege, once the conditions for its application are met (namely, once a document has been created for the dominant purpose of litigation and the litigation in question is pending or may reasonably be apprehended), there is a presumption of non-disclosure.
- Although litigation privilege is subject to the same clearly defined exceptions as solicitor-client privilege, it is not subject to a case-by-case balancing test. The exercise of balancing competing interests is associated with case-by-case privileges, not class privileges. The SCC refused to define any new exceptions to litigation privilege in this case as it was not warranted on the facts.
- Litigation privilege can be asserted not just against parties to the litigation, but also as against third parties, including third-party investigators who have a duty of confidentiality. In arriving at this conclusion, Justice Gascon explained that the open court principle would apply to proceedings initiated by the syndic and that it is far from certain that privileged documents would remain protected in that context. Therefore, a duty of confidentiality on the part of the investigator does not sufficiently protect privileged documents. More generally, the SCC recognized a possible chilling effect if a party’s work could be used by the syndic to prepare for litigation, as this could discourage that party from committing preparatory work to writing.
In light of the above and the important purpose of litigation privilege, to ensure the efficacy of the adversarial process, Justice Gascon concluded that the legislature may abrogate litigation privilege by statute only with “clear, explicit and unequivocal language.” A statute simply requiring the production of any document is insufficient.
A former University of Calgary (University) employee made a request for access to information under Alberta’s Freedom of Information and Protection of Privacy Act (FOIPP). The University refused to produce certain documents on the basis of solicitor-client privilege. The former employee brought an application under FOIPP seeking production of the remaining records, and a delegate of the Information and Privacy Commissioner of Alberta (Commissioner) conducted an inquiry into the matter. In order to assess the claim of privilege, the Commissioner ordered the production of the documents pursuant to section 56(3) of FOIPP, which states that production to the Commissioner is required “despite any other enactment or any privilege of the law of evidence.”
The University refused to produce the documents and sought judicial review of the Commissioner’s order.
The Alberta Court of Queen’s Bench upheld the Commissioner’s decision, concluding that the approach established “a framework that interferes with the confidentiality and privilege only to the extent absolutely necessary.” However, the Court of Appeal overturned this decision. It concluded that the language of section 56(3) was not specific enough to demonstrate clear legislative intent to abrogate privilege.
The SCC agreed with the Court of Appeal. Justice S. Côté, for a majority of the SCC, began by reiterating the principle that “legislative language purporting to abrogate [solicitor-client privilege], set it aside or infringe it must be interpreted restrictively and must demonstrate a clear and unambiguous legislative intent to do so.” She clarified that this is not a renunciation of the modern approach to statutory interpretation and a return to the strict construction rule, but rather reflects the modern approach in that it recognizes legislative respect for fundamental values. Furthermore, while access to information is certainly important in a modern democratic society, requests for access to information are subject to exceptions and FOIPP does not grant unfettered access to documents. Finally, Justice Côté reiterated the important role of solicitor-client privilege, stating that “[i]t is indisputable that solicitor-client privilege is fundamental to the proper functioning of our legal system and a cornerstone of access to justice” and that “solicitor-client privilege must remain as close to absolute as possible and should not be interfered with unless absolutely necessary”. She concluded that section 56(3) of FOIPP is not “sufficiently clear and precise” to abrogate solicitor-client privilege, which is not only a rule of evidence but a rule of substance.
There were two minority decisions, concurring in the result but dissenting in the reasoning. Justice T.A. Cromwell held that the language and context of section 56(3) demonstrated that the legislature intended to lift solicitor-client privilege to permit the Commissioner to order production when necessary to determine the validity of a claim of privilege. Solicitor-client privilege is a substantive principle but also remains a rule of evidence. Justice Cromwell pointed out that the Commissioner would not be able to fulfill her statutory mandate without the power to review a claim of solicitor-client privilege. However, he agreed that the Commissioner made a reviewable error in ordering production in this case, as the affidavit evidence submitted by the University to support the claim of privilege was sufficient. Justice R.S. Abella disagreed with the majority’s finding that the appropriate standard of review was correctness, finding that it ought to be reasonableness. But she agreed that the Commissioner’s decision to order production was unreasonable, because the University provided adequate justification for the claim of privilege.
In both Lizotte and Alberta, the SCC reaffirmed the importance of the two main class privileges. Lizotte is notable for more clearly defining litigation privilege as a class privilege that is “central to the justice system”, even though it may not attract the same close-to-absolute protection of solicitor-client privilege. Alberta in particular creates a very high bar for statutory language that overrides solicitor-client privilege, even for production to an administrative tribunal that is adjudicating a claim of privilege. This means that that public bodies opposing access to records on the basis of privilege are less likely to have those claims tested. Both decisions will be of particular interest to those working within regulatory regimes with arguably ambiguous statutory language requiring production to the regulator.
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