ICBC Law

Two decisions were released this week by the BC Supreme Court dealing with the issue of litigation privilege in BC personal injury lawsuits.  The first case stressed the importance of lawyers properly identifying and listing documents, the second dealt with evidence gathered by an insurance company during the “investigative stage” following a motor vehicle collision.

In the first case (Craig v. Smith) the Plaintiff was injured in a 2006 motor vehicle collision.   The Defendant claimed privilege over various documents and the Plaintiff brought a motion to produce these.   The parties worked out many of their respective differences before the Court gave judgment but prior to resolving the issues Master Caldwell gave the following guidance stressing the importance of lawyers properly disclosing relevant documents:

[5] It is counsel’s duty to determine relevance and claims of privilege; see G.W.L. Properties Ltd. v. W.R Grace & Co., [1992] B.C.J. No. 2387. There is an obligation to describe documents in sufficient detail to enable other parties to assess the validity of the claim of litigation privilege; see Hetherington v. Loo et al, 2007 BCSC 129 and Nanaimo Shipyard Ltd. v. Keith et al, 2007 BCSC 9. The dominant purpose test is still the appropriate test to be applied in determining litigation privilege but is “more compatible with the contemporary trend favouring increased …mutual and reciprocal disclosure which is the hallmark of the judicial process”; see Blank v. Canada (Minister of Justice), 2006 SCC 39.  This is all well settled law.

In the second case (Pshelensky v. Dion) the Plaintiff was involved in a 2006 collision.  Within a week of the crash the Plaintiff hired a personal injury lawyer to represent her.  Shortly after this the Defendant’s insurance company obtained a statement from the Defendant and witnesses to the crash.  After the lawsuit started the Defendant refused to produce a copy of the statement arguing that since the Plaintiff hired a lawyer a lawsuit was reasonably contemplated when the statements were taken and they were protected by ”litigation privilege“.

Master Taylor disagreed and ordered that the Defendant produce the statements. In doing so the Court provided the following reasons:

[18]         I take the view that the two statements taken from the driver and passenger of the defendant motor vehicle were essentially taken to determine the cause of the accident and, of course, to determine who might be at fault.

[19]         In my view the defendants rely upon the fact that the plaintiff retained counsel early on in these proceedings or shortly after the accident to suggest that litigation was contemplated.  I do not agree with this proposition for in my view it was far too early in the proceedings to make a final determination as to whether or not litigation would be inevitable.

[20]         I further take the view that the statements taken from Badr and Dion were so close to the time of the accident that they were very early in the continuum before the dominant purpose became one of furthering the course of litigation.  Accordingly I find that both statements are not privileged and should be released to the plaintiff applicant.

This is just one in a series of recent cases making it clear that when an insurance company is investigating why a crash happened it will be very difficult to keep statements from the Plaintiff in a subsequent lawsuit.  You can click here to read my archived posts further dealing with the issue of litigation privilege in the context of BC personal injury lawsuits.

As I’ve previously written, litigation privilege is a principle which allows parties in a law suit to keep evidence from the other side.  In order to successfully take advantage of litigation privilege the document not only has to have been created in the reasonable contemplation of a lawsuit but also for the ‘dominant purpose‘ of use in such a lawsuit.

If a document was made for multiple reasons (ie - investigating a potential claim and defending against a potential claim) the law will likely require disclosure.  Today the BC Court of Appeal released useful reasons summarizing this area of law.

In today’s case (Mathew v. Delta School District #37) the Plaintiff ’slipped and fell on some ice at a school’.  Shortly after the incident the school’s principal, a teaching assistant and a custodian made notes documenting what occurred.  The Plaintiff started a lawsuit and asked for these.  The Defendant refused to produce these claiming they were privileged.  The dispute made it all the way to the BC Court of Appeal who found that the documents were not privileged as they were made during the ‘investigatory stage‘.  The BC High Court provided the following very useful reasons:

[11] The investigatory stage to which the master referred is well recognized in the authorities. In Hamalainen at para. 24, the following was quoted from a speech in Waugh v. British Railways Board, [1980] A.C. 521 at 541, attributing it to what Lord Denning had said in that case:

If material comes into being for a dual purpose – one to find out the cause of the accident – the other to furnish information to the solicitor – it should be disclosed, because it is not then “wholly or mainly” for litigation. On this basis all the reports and inquiries into accidents – which are made shortly after the accident – should be disclosed on discovery and made available in evidence at the trial.

[12]         The investigatory stage was discussed in Hamalainen as follows:

[26]      Even in cases where litigation is in reasonable prospect from the time a claim first arises, there is bound to be a preliminary period during which the parties are attempting to discover the cause of the accident on which it is based. At some point in the information gathering process the focus of such an inquiry will shift such that its dominant purpose will become that of preparing the party for whom it was conducted for the anticipated litigation. In other words, there is a continuum which begins with the incident giving rise to the claim and during which the focus of the inquiry changes. At what point the dominant purpose becomes that of furthering the course of litigation will necessarily fall to be determined by the facts peculiar to each case.

[13]         It was, on the evidence, open to the master to regard the notes as being made in the investigatory stage as opposed to the later litigation stage. They were made directly following Mr. Mathew’s accident. I recognize it may be argued that, in the circumstances, there was little in the way of an investigatory stage here. But that is a matter to be determined on the peculiar facts of each case and I am unable to accept that the evidence foreclosed the significance the master appears to have attached to the notes being made as quickly as they were in relation to the incident.

Further to my recent post on this topic, often after serious motor vehicle collisions ICBC sends adjusters out to collect statements from the parties and known witnesses to the event.

When a lawsuit for compensation is brought by an injured party ICBC sometimes does not disclose the witness statements to the Plaintiff on the basis of ‘litigation privilege‘.   Being a monopoly insurer, ICBC investigates claims and our Courts have consistently held that if the statements were obtained during the ‘investigation‘ stage ICBC’s claim of ‘litigation privilege‘ will fail and the documents will have to be disclosed.  Reasons for judgement were released this week with helpful comments addressing this area of the law.

In this week’s case (Sauve v. ICBC) the Plaintiff was injured in 2008 motor vehicle collision.   After the collision ICBC hired an independent adjuster who obtained witness statements and also provided ICBC a report in which she sized up the various witnesses.  In describing the report the adjuster deposed that she “used my expertise and experience as an Insurance Adjuster to describe each of the Witnesses, including their physical appearance, demeanor and presentation. I also provided an analysis as to the likely performance of each witness in court. I further provided analysis of the commonalities between various witness accounts for the purpose of assessing credibility and preparing the case of the Defendant, ICBC should litigation occur”

ICBC provided the Plaintiff with the witness statements but refused to provide the report claiming the protection of litigation privilege.  The Plaintiff brought a motion to force disclosure.  Ultimately Mr. Justice Joyce held that the reports were privileged and ICBC did not have to disclose them to the Plaintiff.  Before reaching this conclusion the Court provided helpful reasons addressing the difficulty ICBC may face in claiming privilege over witness statements obtained in the immediate aftermath of a collision.  Mr. Justice Joyce reasoned as follows:

[34] I turn to the second part of the test: were the documents created for the dominant purpose of assisting the defendant in the conduct of the anticipated litigation by Ms. Sauvé?

[35] Once again in answering that question, it is important to focus on when the reports were created and to consider them separate from any consideration of whether the witness statements and photographs would meet the dominant purpose test. I can certainly accept that the witness statements and photographs may well have come into existence for two purposes:

(1)       to investigate the circumstances of the accident, and

(2)       to assist in the conduct of litigation.

[36] Therefore, whether those documents would satisfy the second part of the test might have been a difficult question to answer. The defendant might not have been able to meet the test for the first group of documents on a balance of probabilities, but that is not the question that I have to decide.

[37] In my view, when deciding whether the reports were prepared for the dominant purpose of litigation I have to consider not only what was known by Mr. Taylor and communicated to Ms. Webber; I also have to consider what Ms. Webber knew when she prepared the reports, as well as the nature of the reports. Ms. Webber has deposed that when she prepared the reports, she believed that the dominant purpose for their creation was litigation. She came to that conclusion being aware of the information that the witnesses could give with respect to the circumstances of the accident. According to Ms. Webber, the reports consist of her descriptions of the witness, her impressions or opinions concerning their credibility and her own analysis of how the evidence of the various witnesses matched or conflicted. While it might be possible that such information might assist ICBC at the investigation stage, I am of the view that any such use of the documents would clearly be secondary to their use in assisting counsel in the conduct of the action. I am, therefore, satisfied that the reports were created for the dominant purpose of litigation and attracted litigation privilege.

In addition to the above this case contains a useful analysis of the law of waiver of privilege and ‘common interest’ privilege and is worth reviewing in full for anyone interested in these topics.

As I’ve previously written, litigation privilege is a principle which allows parties not to share relevant documents with the other side in a lawsuit in limited circumstances.  Despite this principle, the BC Courts seem to be favouring the trend of disclosure making it more difficult for parties not to disclose documents after lawsuits get underway.  Reasons for judgement were released last week demonstrating this trend.

In last week’s case (Beer v. Nickerson) the Plaintiff was injured in 2008 as a result of a slip and fall incident at a Pharmasave in Victoria, BC.  The Plaintiff alleged the fall occurred as a result of the Defendant’s “negligent operation of her scooter in the store“.

The Defendant contacted her insurance company after the incident.  The insurance company conducted an investigation and in the process of this obtained a statement from the Defendant, a drawing of the store prepared by the Defendants daughter, and photographs of the location of the incident.

After the lawsuit started the Defendant’s lawyer refused to provide these documents arguing they were protected by “litigation privilege“.   Master Bouck of the BC Supreme Court disagreed and ordered that these documents be produced.  In reaching this conclusion the Court reasoned that the documents were not privileged because a lawsuit was not a ‘reasonable prospect‘ when these documents were created and further that they were not created for the ‘dominant purpose‘ of use in a lawsuit.  Before reaching her verdict Master Bouck provided the following useful summary of the law:

[17] The legal principles to be applied on this application are well-settled and set out in Hamalainen (Committee of) v. Sippola (1991), 62 B.C.L.R. (2d) 254, and Stevanovic v. Petrovic, supra. Those principles are as follows:

1.  The party withholding disclosure bears the onus of establishing a claim for privilege over a document.

2.  The test for considering whether litigation privilege is established is two-fold:

(a)  Was litigation a reasonable prospect at the time the document in dispute was created?

(b)  If so, was the dominant purpose of the document’s creation for use in litigation? (commonly known as the “dominant purpose” test.)

3.  Litigation can properly be said to be in reasonable prospect when a reasonable person, possessed of all the pertinent information including that particular to one party or the other, would conclude that it is unlikely that the claim for loss will be resolved without it.

4.  However, the prospect of litigation alone is not sufficient to meet the claim of privilege. Nor does the denial of liability alone mean that all documents produced thereafter are subject to a claim for privilege. As stated by the court in Hamalainen v. Sippola:

Even in cases where litigation is in reasonable prospect from the time a claim first arises, there is bound to be a preliminary period during which the parties are attempting to discover the cause of the accident on which it is based. At some point in the information gathering process the focus of such an inquiry will shift such that its dominant purpose will become that of preparing the party for whom it was conducted for the anticipated litigation. In other words, there is a continuum which begins with the incident giving rise to the claim and during which the focus of the inquiry changes. At what point the dominant purpose becomes that of furthering the course of litigation will necessarily fall to be determined by the facts peculiar to each case.

6.  It is not incumbent upon the court to accept without question the opinion of either deponent on one of the very issues that is to be decided. Whether or not litigation was a reasonable prospect is a matter for the court to decide on all the evidence.

[18] To these principles I would add that the dominant purpose test is consistent with “the more contemporary trend favouring increased disclosure”: Blank v. Canada (Department of Justice), 2006 SCC 39 at paras. 60-61.

This case is helpful in permitting Plaintiffs to obtain more fulsome disclosure early in a lawsuit.  Our Courts have made it clear that if documents are gathered by an insurance company for the purpose of investigating a claim (as opposed to defending a potential lawsuit) then these documents will have to be disclosed under the BC Supreme Court Rules.

Further to my previous posts on the topic of ICBC Claims and Privilege, reasons for judgement were released yesterday by the BC Supreme Court, New Westminster Registry, demonstrating that a party seeking to withhold documents on the basis of ‘litigation privilege’ may face an uphill battle.

In yesterday’s case (Celli v. White) the Plaintiff was a pedestrian who was struck by a vehicle.  The Plaintiff was injured and eventually sued for damages.  In the course of the lawsuit the Defendants refused to produce a number of documents relevant to the Plaintiff’s Claim on the basis that they were protected by ‘litigation privilege‘.

The Plaintiff obtained legal advice almost immediately after the accident.  As a result of this the defence lawyers argued that “litigation was inevitable from the outset.”  On this basis the Defendant refused to produce a number of documents which were gathered by the Defendant’s insurer in the immediate aftermath of this collision.

The Plaintiff applied to Court for production of a number of the allegedly privileged documents.  The Plaintiff was largely successful and the Defendants were ordered to produce a number of documents which were gathered by the Defendants insurer in the 6 months following the collision.  In reaching this decision Master Caldwell summarized the law of litigation privilege in the context of BC Injury Claims as follows:

[8] The leading case in this subject area is Hamalainen v. Sippola (1991), 62 B.C.L.R. (2d) 254 [Hamalainen].  In that case the Court of Appeal held that two factual determinations were required in order to uphold a claim of litigation privilege:

(1)        Was litigation in reasonable prospect at the time the document was produced,

(2)        If so, what was the dominant purpose for its production?

[9] The court indicated that while the first of these requirements would not likely be overly difficult to establish, the second would be more challenging:

22.       I am not aware of any case in which the meaning of “in reasonable prospect” has been considered by this Court. Common sense suggests that it must mean something more than a mere possibility, for such possibility must necessarily exist in every claim for loss due to injury whether that claim be advanced in tort or in contract. On the other hand, a reasonable prospect clearly does not mean a certainty, which could hardly ever be established unless a writ had actually issued. In my view litigation can properly be said to be in reasonable prospect when a reasonable person, possessed of all pertinent information including that peculiar to one party or the other, would conclude it is unlikely that the claim for loss will be resolved without it. The test is not one that will be particularly difficult to meet. I am satisfied it was met in this case in connection with all of the documents in issue. The circumstances of this accident, and the nature of Mr. Hamalainen’s injuries, were such that litigation was clearly a reasonable prospect from the time the claim was first reported on December 1st, 1986.

(b)        What was the dominant purpose for which the documents were produced?

23.       A more difficult question to resolve is whether the dominant purpose of the author, or the person under whose direction each document was prepared, was “… [to use] it or its contents in order to obtain legal advice or to conduct or aid in the conduct of litigation …”.

24.       When this Court adopted the dominant purpose test, it did so in response to a similar move by the House of Lords in Waugh v. British Railways Board, [1980] A.C. 521. In that case the majority opinion is to be found in the speech of Lord Wilberforce, who agreed “in substance” with the dissenting judgment of Lord Denning M.R. in the Court below. While the Court of Appeal judgments do not appear to have been reported, some excerpts from Lord Denning’s opinion are to be found in the speech of Lord Edmund-Davies, including the following at p. 541 of the report:

If material comes into being for a dual purpose - one to find out the cause of the accident - the other to furnish information to the solicitor - it should be disclosed, because it is not then “wholly or mainly” for litigation. On this basis all the reports and inquiries into accidents - which are made shortly after the accident - should be disclosed on discovery and made available in evidence at the trial.

25.       At the heart of the issue in the British Railways Board case was the fact that there was more than one identifiable purpose for the production of the report for which privilege was claimed. The result of the decision was to reject both the substantial purpose test previously adhered to by the English Court of Appeal and the sole purpose test which by then had been adopted by the majority of the Australian High Court in Grant v. Downs.

26.       Even in cases where litigation is in reasonable prospect from the time a claim first arises, there is bound to be a preliminary period during which the parties are attempting to discover the cause of the accident on which it is based. At some point in the information gathering process the focus of such an inquiry will shift such that its dominant purpose will become that of preparing the party for whom it was conducted for the anticipated litigation. In other words, there is a continuum which begins with the incident giving rise to the claim and during which the focus of the inquiry changes. At what point the dominant purpose becomes that of furthering the course of litigation will necessarily fall to be determined by the facts peculiar to each case.

27.       In that sense there is obviously no absolute rule that the decision to deny liability in such a claim must mark the point in which the conduct of litigation becomes the dominant purpose underlying the production of each and every document of the sort for which privilege was claimed in this case. But I do not read the master’s reasons as invoking any such absolute rule. He was faced with affidavit material filed by the party claiming privilege which was deficient in a number of respects. As already noted it failed to draw any distinction between the purpose underlying the production of individual documents. The risk inherent in that approach was pointed out by Mr. Justice Esson in the Shaughnessy Golf case at p. 319 of the report:

Privilege was claimed for a large number of documents. The grounds for it had to be established in respect of each one. By trying to extend to the whole list the considerations which confer privilege on most of the documents, the plaintiff has confused the issue and created the risk that, because it did not make in its evidence the distinctions that could have been made, it must be held not to have established privilege for any.

28.       Furthermore, the affidavit material concentrated on the repetitious assertion by each deponent of his belief that litigation in the case was inevitable, from which fact the dominant purpose underlying the production of all documents was apparently assumed. As already pointed out that approach to the onus facing the deponent on this question represented a mistaken view of the law.

[10] Gray J. echoed this sentiment at paragraphs 97 and 98 of Keefer Laundry Ltd. v. Pellerin Milnor Corp., 2006 BCSC 1180 as follows:

97.       The first requirement will not usually be difficult to meet.  Litigation can be said to be reasonably contemplated when a reasonable person, with the same knowledge of the situation as one or both of the parties, would find it unlikely that the dispute will be resolved without it. (Hamalainen v. Sippola, supra.)

98.       To establish “dominant purpose”, the party asserting the privilege will have to present evidence of the circumstances surrounding the creation of the communication or document in question, including evidence with respect to when it was created, who created it, who authorized it, and what use was or could be made of it. Care must be taken to limit the extent of the information that is revealed in the process of establishing “dominant purpose” to avoid accidental or implied waiver of the privilege that is being claimed.

[11] This dominant purpose test was also confirmed by Fish J. in the case of Blank v. Canada (Minister of Justice), 2006 SCC 39 at paragraphs 60 and 61:

60. I see no reason to depart from the dominant purpose test. Though it provides narrower protection than would a substantial purpose test, the dominant purpose standard appears to me consistent with the notion that the litigation privilege should be viewed as a limited exception to the principle of full disclosure and not as an equal partner of the broadly interpreted solicitor-client privilege. The dominant purpose test is more compatible with the contemporary trend favouring increased disclosure. As Royer has noted, it is hardly surprising that modern legislation and case law

[TRANSLATION] which increasingly attenuate the purely accusatory and adversarial nature of the civil trial, tend to limit the scope of this privilege [that is, the litigation privilege]. [para. 1139]

Or, as Carthy J.A. stated in Chrusz:

The modern trend is in the direction of complete discovery and there is no apparent reason to inhibit that trend so long as counsel is left with sufficient flexibility to adequately serve the litigation client. [p. 331]

61. While the solicitor-client privilege has been strengthened, reaffirmed and elevated in recent years, the litigation privilege has had, on the contrary, to weather the trend toward mutual and reciprocal disclosure which is the hallmark of the judicial process. In this context, it would be incongruous to reverse that trend and revert to a substantial purpose test.

In ordering that the Defendants produce the relevant documents the Court held that the dominant purpose of much of the defendants insurer’s early investigations was due to ‘adjusting‘ the potential claims as opposed to in response to anticipated ‘litigation‘.

Since ICBC is a monopoly insurer in British Columbia the analysis of the ‘adjusting‘ phase vs. the ‘litigation‘ stage will be triggered in most multi-party motor vehicle collisions.  The lesson to be learned is that many documents which are gathered by ICBC in the early stages which may prove harmful to a Defendant if disclosed may not be protected by privilege if they were gathered by for the dominant purpose of determining how a collision occurred.

Further to my many posts on the topic of discovery, when parties are involved in a lawsuit in the BC Supreme Court the Rules of Court require the parties to disclose certain information to the opposing side.  Generally all relevant information needs to be disclosed however there are exceptions to this and one such exception is ‘privilege‘.

Generally speaking (this is not an exhaustive list), privileged documents are documents that were created with an expectation of confidentiality between a party and his/her lawyer or documents that were created with the dominant purpose of advancing the parties interests in court.

The purpose behind the privilege exception to disclosure is to permit individuals to freely discuss their legal matters and work with their lawyers to advance their interests without the fear that these conversations/actions can come back to hurt the individuals interests later on.

The law recognizes an extension of privilege between one client and their lawyer to multiple people and that lawyer if the conversations took place in anticipation of a lawsuit and the multiple parties have a common interest.  This type of privilege is sensibly called ‘common interest privilege‘.  Reasons for judgement were released today discussing this area of law and highlighting some of the limitations of common interest privilege.

In today’s case (Peters v. Paterson) the Plaintiff was seriously injured while windsurfing when he was involved in a collision with a motorboat.  He eventually sued multiple parties including the people alleged to have been operating the boat (the “Motorboat Defendants”) and the people alleged to have rented the boat to the Motorboat Defendants (the “Renter Defendants”).

Before the lawsuit started one of the Renter Defendants apparently feared a potential lawsuit and retained the services of a lawyer.  That lawyer retained an adjuster who immediately took statements from a handful of people including the people who would later turn out to be the Motorboat Defendants.

After all the Defendants were sued by the Plaintiff the Renter Defendant who initially hired the lawyer issued a Third Party Notice against the Motorboat Defendants (a Third Party Notice is a document which alleges that if a certain defendant is found at fault and has to pay that the Third Party has to indemnify that defendant for the judgement).

The Plaintiff then asked for the statements of the Motorboat Defendants to be produced.  The Lawyer for the Renter Defendants refused citing ‘common interest privilege‘.  Ultimately an application was brought to court to force disclosure and the application succeeded.  Master Taylor of the BC Supreme Court, Vancouver Registry, held that the Third Party Notice took away any claim to common interest privilege.  The key reasons were as follows:

[13] Common interest privilege is said to be an extension of the privilege against disclosure of solicitor-client communications.  As Wigmore defines it:

The chief instance occurs when the same attorney acts for two parties having a common interest, and each party communicates with him.  Here the communications are clearly privileged from disclosure at the instance of a third person.  Yet they are not privileged in a controversy between the two original parties, inasmuch as the common interest and employment forbade concealment by either from the other.  (Wigmore’s emphasis)

[14] The defendants take the position that the statements in this case are covered by common interest privilege, which, they submit, applies to an exchange of confidential information between individuals who have a common interest in anticipated litigation.  The defendants cite Buttes Gas and Oil Co. v. Hammer (No. 3), [1980] 3 All E. R. 475 (C.A) in support of their position where Lord Denning says:

There is a privilege which may be called a “common interest” privilege.  That is a privilege in aid of anticipated litigation in which several persons have a common interest.  It often happens in litigation that a plaintiff or defendant has other persons standing alongside him – who have the self-same interest as he – and who have consulted lawyers on the self-same points as he – but these others have not been made parties to the action…All exchange counsel’s opinions.  All collect information for the purpose of litigation.  All make copies.  All await the outcome with the same anxious anticipation – because it affects each as much as it does the others.

[15] The defendants maintain that common interest privilege can apply to witness statements and in fact has been so applied in a number of Canadian cases.

[16] On the other hand, the plaintiff asserts that the case at bar is distinguishable from other cases in that there is no suggestion by the defendant or their counsel that counsel has ever worked in conjunction with the motorboat defendants to jointly advance the interests of all the defendants.  As well, the plaintiff maintains, there has not been any evidence led to indicate the motorboat defendants understood the reason for giving their statements, the uses their information would be put to, or that their statements would be kept privileged from the plaintiff.  In fact, in the instant case, two of the motorboat defendants have signed authorizations to release their statements to the plaintiff.

[17] In the recent decision in Maximum Ventures Inc. v. De Graaf, 2007 BCCA 510, Mr. Justice Mackenzie discussed the test for maintaining privilege between parties at paragraph 14:

Recent jurisprudence has generally placed an increased emphasis on the protection from disclosure of solicitor-client communications, including those shared in furtherance of a common commercial interest.  In the instant case the [solicitor’s] draft was produced within the recognized solicitor-client privileged relationship.  The common interest privilege issues arise in response to a plea of waiver of that privilege.  The common interest privileges is an extension of the privilege attached to that relationship.  The issue turns on whether the disclosures were intended to be in confidence and the third parties involved had a sufficient common interest with the client to support extension of the privilege to disclosure to them….Where legal opinions are shared by parties with mutual interests in commercial transactions, there is a sufficient interest in common to extend the common interest privilege to disclosure of opinions obtained by one of them to the others within the group, even in circumstances where no litigation is in existence or contemplated.

[18] And, at paragraph 16, Mackenzie, J.A. made the following finding:

The interests of the clients of the three solicitors were not identical but they were common to the extent that financing of the Western exploration of the Mongolian properties was beneficial to all of them.  They also shared an interest in assessing the invalidity of Maximum’s claims.

[19] The defendants maintain that even though two of the defendants have signed authorizations addressed to counsel for the defendants directing that their statements be released to counsel for the plaintiff, they cannot, in these circumstances, create a waiver over the common interest privilege by so doing.

[20] In my view, that argument begs the question for two reasons.  Firstly, were the persons from whom the statements taken to request copies of their statements, surely they would be entitled to receive copies of them as no privilege attaches to one’s own statement in the hands of a third party?  It would then be open to each of those parties to deliver a copy of their statements directly to the plaintiff.  Secondly, the defendant, Paterson, has issued third party proceedings against the four individual motorboat defendants for which he seeks judgment against the motorboat defendants, or indemnity from them in the event a judgment is rendered against Paterson.

[21] The Third Party Notice contains the following allegations:

a. The plaintiff’s windsurfer struck the port side of the motorboat;

b. The motorboat defendants represented that Arvinder Kaler would be the person operating the motorboat;

c. While Paterson does not know who was operating the boat at the time of the accident, it has been represented to Paterson that Sukhbir Brar was operating the motorboat at the time of the accident; and

d. the accident was caused solely by the negligence of the operators of the motorboat.

[22] In the circumstances, two things are apparent.  One, that the allegations made in the Third Party Notice are likely the result of information gleaned from the motorboat defendants, and, two, the defendant, Paterson, alleges the accident was caused solely by the negligence of the motorboat defendants, which creates the question: where is the commonality of interest between the renter defendants and the motorboat defendants such that a privilege continues to exist over the statements taken from the motorboat defendants?

[23] In my view, by the very nature of the Third Party Notice and the allegations made in it, there has been a severing of the commonality of interest of the defendants.  In the result, therefore, there is no common interest privilege which can be maintained, and, accordingly, the statements taken from the four motorboat defendants are no longer privileged and must be turned over to the plaintiff.

Further to my previous posts on Litigation Privilege in British Columbia, reasons for judgement were released today adding further clarity to this area of the law.

In today’s case (Shooting Star Amusements Ltd. v. Prince George Agricultural and Historical Association) the Plaintiff brought an application for the production of certain documents which the Defendant refused to produce on the grounds of Litigation Privilege.   Madam Justice Bruce ordered that the documents be produced.  The Defendant appealed.  In dismissing the appeal the BC Court of Appeal made it clear that when asserting a claim for privilege the party must offer evidence in support of this claim.  Specifically the Court held that:

it is only common sense that where a claim of privilege is contested, a court would normally require something more than counsel’s opinion offered in the course of argument.  As Mr. Cassie argued on behalf of the plaintiff, it has been clear at least since this court decidedHamalainen (Committee of) v. Sippola (1991) 62 B.C.L.R. (2d) 254, 3 C.P.C. (3d) 297 that the party asserting privilege in respect of a document bears the onus of establishing the privilege.

The defendant argued that the order for production would cause irreparable harm because the materials ordered to be disclosed would provide details of settlement discussions and legal advice.  The Court noted that such evidence was not before the trial judge.  Interestingly, the court stated that just because a claim for litigation privilege fails in a document production application the party is free to raise the claim again at trial and the trial judge will need to consider whether the documents can stay out of evidence for grounds privilege.  Specifically Madam Justice Newbury stated

I note that although the defendant was ordered to disclose the minutes, unredacted, to the plaintiff, this does not mean they, or the information they contain, will be admissible at trial.  A claim of privilege can still be asserted by the defendants if and when the plaintiff seeks to introduce the minutes into evidence and it will be for the trial judge to determine whether any kind of privilege does indeed attach.

Useful reasons for judgement were released today by the BC Supreme Court dealing with the records that need to be disclosed to opposing counsel following an Independent Medico-Legal Exam.

In today’s case (Gulamani v. Chandra) the Plaintiff was involved in 2 motor vehicle accidents approximately one decade apart. In the course of the lawsuits she attended various medico-legal appointments at the request of the Defence Lawyers under Rule 30 of the BC Supreme Court Rules.

Following these the Plaintiff’s lawyer brought an application that  these doctors deliver “copies of their examining notes or any other recording generated by or on behalf of the said doctors that record any history given to them by the plaintiff on the examination, and any notes that record the doctor’s observations or findings on physical examination together with copies of any tests, questionnaires, or other documents completed by or on behalf of the plaintiff including scoring documents prepared by the examiner“.

The Defence lawyers opposed this motion and argued that the sought materials “constitute the doctors’ working papers and underlying materials that are privileged and part of the solicitor’s brief until the doctor testifies in court, at which point the privilege is waived. ”

Madam Justice Arnold-Bailey rejected the defence position and noted that “solicitor’s brief privilege can be trumped when it comes to the bare facts” and that “there is no property in a witness of fact”.  In ordering production of the sought records the Court extensively canvassed the law in this area and summarized its position as follows:

[24]         Stainer and Traynor clearly indicate that any notes, annotations, recordings, or working papers that reveal an examining doctor’s confidential opinion or advice to counsel will, generally, be privileged.  Even things as small as question marks or exclamation marks added to raw test data could fall into this category and would potentially need to be redacted:Traynor, at para. 21.

[25]         However, the cases also illustrate that notes or recordings that capture the factual history given by the plaintiff to an examining doctor, as well as raw test data and results, are outside the scope of solicitor-client privilege and are subject to production.  I agree with the conclusion reached by the learned master in McLeod as one that follows these basic principles and extends them to circumstances outside the scope of a Rule 30 order. General principles are indeed just that - general principles - and not principles that are only to be applied in making a Rule 30 order or only to be applied when such an order is made.  As Master Caldwell opined in McLeod, the timing of the request for disclosure and whether a court order triggered the examination are factors which do not override the application of Rule 1(5) and the court’s role to “secure the just, speedy and inexpensive determination of every proceeding on its merits”.  I share this view.

[26]         I do not disagree with the submission by counsel for the Chandra defendants, in line with S. & K. Processors and Vancouver Community College, that an expert’s working papers remain privileged until that expert takes the witness stand.  As I understand the jurisprudence, however, there is a clear distinction between an expert’s working papers, which contain opinions, or which may be prepared for the sole purpose of advising counsel, and the facts underlying those opinions or advice.  In the case at bar, the plaintiff is not asking for the type of documents that were at issue in those cases, and those cases reaffirm that the factual material the plaintiff seeks is indeed subject to production.

[27]         The Sutherland case is perhaps, at first blush, most problematic for the plaintiff, in that it appears to imply that the only factual material requiring disclosure will be that which is not already adequately set out in the written statement accompanying the expert report (in the context of Rule 40A).  As I have indicated above, however, upon further analysis I do not believe the case stands for this point.  The court in Sutherland could not find that giving notice under Rule 40A meant that everything underlying the report was suddenly subject to production before the witness took the stand, because a pre-existing privilege existed over the documents, and was not entirely waived simply by virtue of giving notice under Rule 40A.  The court therefore only ordered production of the raw data from among the requested general “rubric of clinical records” – material that was clearly factual in nature and did not involve opinion or advice.

[28]         On that note, the question that may remain after reviewing many of these cases is whether, prior to notice being given under Rule 40A, there is any privilege over the examining doctors’ materials, specifically over anything factual in nature reported by the client and not involving opinion or advice.

[29]         I am of the view that this is not so in the circumstances of the case at bar.  The passages from Stainer cited above reaffirm that even the solicitors’ brief privilege can be trumped when it comes to the bare facts, since it is well settled that “there can be no property in a witness of fact”.  Further, regardless of the way any of the cases cited in these reasons unfolded, including applications under Rule 30, outside of Rule 30, under Rule 26, pursuant to Rule 40A, and under s. 11 of the Evidence Act, and both before a report has been put into evidence and before a report has even been created, I fail to see any examples where a court has declined to order production of the factual underpinnings of an expert’s report, as reported by the plaintiff and recorded in notes, annotations and test data.

[30]         The facts of the present matter are also such that it is the plaintiff who has applied for the information in question, and it was of course the plaintiff herself who provided that information and raw data to the doctors in question.  Further, as I appreciate the circumstances of the present application, it is the non-party doctors who have the information in their hands, and not counsel for the Chandra defendants, who presumably have not been privy to the underpinnings of the reports.  As such, I fail to see how, in these circumstances, there is any doctor-client privilege or solicitor-client privilege to assert, or any strong argument to be made about non-party rights in the context of Rule 26(11)…

[36] In conclusion on this issue, I therefore order that the defendants and Doctors Hawkins, Hepburn, Weeks, Magrega, and Munro deliver to the solicitor for the plaintiff copies of their examining notes or any other recording generated by or on behalf of said doctors that records any history given to them by the plaintiff on the examination and any notes that record the doctor’s observations or findings on physical examination together with copies of any tests, questionnaires, or other documents completed by or on behalf of the plaintiff, including scoring documents prepared by the examiner, except any documents containing the doctors’ opinions or advice, within 14 days of the pronouncement of this order.

In addition to the above, the Plaintiff’s lawyer also brought a motion for production of records documenting the extent of MSP Billings that one of the Defence Doctor’s had with respect to Thoracic Outlet Syndrome. In partially granting this order Madam Justice Arnold-Bailey held as follows with respect to the relevance of such a request:

[44] I agree with plaintiff’s counsel’s that the expertise of Dr. Munro is an issue, albeit ancillary, to this matter and that the information has been properly sought pursuant to Rule 26(11).  The information sought is relevant because, to use the wording in Peruvian Guano, it may allow the requesting party to damage the case of its adversary.  After all, to properly cross-examine Dr. Munro on his qualifications at trial will require counsel to be prepared with the relevant information to be able to do so, and as I understand it, acquiring the information at that later stage would interrupt the trial given the time it takes to receive it from Health Services.  To be clear, I find that Dr. Munro’s opinion and expertise is important as it relates to the plaintiff’s injury claims, particularly because it conflicts with the opinion of another medical expert.

In BC Lawsuits one of the primary goals of the Rules of Court is to require document disclosure to put the parties on a level playing field with respect to the facts and to prevent trial by ambush.

Disclosure requirements, however, need to compete with the equally compelling doctrine of privilege which permits parties to lawsuits the right to refuse production of certain classes of otherwise relevant documents. Two categories of privileged documents which are not always clearly understood by litigants are those of ‘solicitor client privilege‘ and ‘litigation privilege’.

Today the BC Supreme Court released reasons for judgement explaining the difference between these classes of privileged documents.

In today’s case (Lougheed Estate v. Wilson) the Plaintiff sought access to certain documents which the Defendant refused to produce on the basis on litigation privilege.  In ordering that the documents be produced Mr. Justice Grauer did a great job in explaining the difference between solicitor-client and litigation privilege.  I reproduce this summary below:

(b) Solicitor-client privilege

[26] Solicitor-client privilege, or “legal advice privilege”, is conceptually different from litigation privilege.  One of the important differences is that solicitor-client privilege applies only to confidential communications between the client and his or her solicitor: Blank v. Canada, [2006] S.C.R. 319, 2006 SCC 39 at para. 28, citing with approval Professor R.J. Sharpe (now Sharpe, J.A.):  “Claiming Privilege in the Discovery Process”, in Special Lectures of the Law Society of Upper Canada (1984), 163, at pp. 164-65.

[27] The documents over which Mr. Wilson asserts privilege that are at issue before me consist solely of correspondence between Mr. Wilson’s solicitor and counsel for Elections Canada.  They do not consist of confidential communications between Mr. Wilson and his solicitor.  Accordingly, I find that they are not eligible for the protection of solicitor-client privilege.

(c) Litigation privilege

[28] The nature of litigation privilege was thoroughly discussed by the Supreme Court of Canada in the Blank case, where Fish J. quoted further from Prof. Sharpe’s article as follows (loc. cit. supra):

Litigation privilege, on the other hand, is geared directly to the process of litigation.  Its purpose is not explained adequately by the protection afforded lawyer-client communications deemed necessary to allow clients to obtain legal advice, the interest protected by solicitor-client privilege.  Its purpose is more particularly related to the needs of the adversarial trial process.  Litigation privilege is based upon the need for a protected area to facilitate investigation and preparation of the case for trial by the adversarial advocate.  In other words, litigation privilege aims to facilitate a process (namely, the adversary process), while solicitor-client privilege aims to protect the relationship (namely, the confidential relationship between a lawyer and the client).

[29] Fish J. then went on to explore the limits of the privilege:

34        The purpose of the litigation privilege, I repeat, is to create a “zone of privacy” in relation to pending or apprehended litigation.  Once the litigation has ended, the privilege to which it gave rise has lost his specific and concrete purpose – and therefore its justification.  But to borrow a phrase, the litigation is not over until it is over.  It cannot be said to have “terminated”, in any meaningful sense of that term, where litigants or related parties remain locked in what is essentially the same legal combat.

35        Except where such related litigation persists, there is no need and no reason to protect from discovery anything that would have been subject to compellable disclosure but for the pending or apprehended proceedings which provided its shield….

36        I therefore agree with the majority in the Federal Court of Appeal and others who share their view that the common-law litigation privilege comes to an end, absent closely related proceedings, upon the termination of the litigation that gave rise to the privilege [citations omitted].

37        Thus, the principal “once privileged always privileged”, so vital to the solicitor-client privilege, is foreign to the litigation privilege.  The litigation privilege, unlike the solicitor-client privilege, is neither absolute in scope nor permanent in duration.

38        As mentioned earlier, however, the privilege may retain its purpose – and, therefore, its effect – where the litigation that gave rise to the privilege has ended, but related litigation remains pending or may reasonably be apprehended….

39        At a minimum, it seems to me, this enlarged definition of “litigation” includes separate proceedings that involve the same or related parties and arise from the same or related cause of action (or “juridical source”).  Proceedings that raise issues common to the initial action and share its essential purpose would in my view qualify as well.

40        As a matter of principle, the boundaries of this extended meaning of “litigation” are limited by the purpose for which litigation privilege is granted, namely, as mentioned, “the need for a protected area to facilitate investigation and preparation of the case for trial by the adversarial advocates” (Sharpe, at p. 165).

It is common for lawyers involved in personal injury claims to retain the services of expert witnesses.  The most common expert witnesses are medical doctors but often engineers, economists, and other specialists are brought into the fray.

Experts are typically retained to be involved in two common roles.  The first role is to provide expert opinions to assist the judge or jury to understand the evidence called at trial.  The second is to assist counsel in preparing the case for trial.  When experts are retained to assist counsel to prepare for trial the communications between the expert and the lawyer are confidential and subject to litigation privilege.

When an expert takes the stand and gives opinion evidence they are subject to a cross-examination that is quite wide in scope.  Does this permit the opposing side to ask questions about the confidential opinions and advice the expert gave the lawyer that retained him prior to trial?  Not necessarily.  Reasons for judgement were transcribed today by the BC Supreme Court, Vancouver Registry, dealing with this issue.

In today’s case (McLaren v. Rice) the Defendants to a car accident claim hired an engineer who was qualified to give expert opinion evidence regarding accident reconstruction and speed and speed changes.  During cross examination the lawyer for the Plaintiff asked whether the defence lawyer sought his opinion with respect to a vehicle’s tie-rod and ball-joint assembly.  The Defence lawyer objected to the question claiming it addressed matters that were protected by litigation privilege.  Mr. Justice Brooke upheld the objection and in doing so summarized and applied the law as follows:

[4] In the recent decision of Madam Justice Satanove in Lax Kw’alaams, 2007 BCSC 909, the nature and extent of litigation privilege was considered.  At paragraph 9, Justice Satanove referred to the decision in Delgamuukw where it was said that litigation privilege was waived when the expert witness was called, but that that waiver was to be narrowly construed and privilege maintained when it was fair to do so.

[5] In Vancouver Community College v. Phillips, Barratt (1987), 20 B.C.L.R. (2d) at 289 (S.C.), Justice Finch, as he then was, recognized that even where an expert is called as a witness he may remain a confidential advisor to the party who called him at least in regard to advising on cross-examination of the other side’s witnesses, including the other side’s expert witnesses.

[6] In Lax Kw’alaams as well as in Barratt, the issue was the production and cross-examination on documents that had been prepared by the witness.  As I understand it, here all privileged documents are set out in part 3 of the document disclosure of the defendant and there is no suggestion that there are undisclosed documents.

[7] What the plaintiff wishes to cross-examine upon is not documents, but oral advice or opinions or commentary concerning the tie-rod assembly and ball joint, an area which the report of Mr. Brown does not pretend to address.

[8] I find, if Mr. Brown was asked questions out of court regarding the tie-rod and ball-joint assembly it was to assist the defendant in its defence of the plaintiff’s claim and specifically the allegation that the collapse of the tie-rod and ball-joint assembly caused the accident in which the plaintiff sustained devastating injuries.

[9] In my opinion, it would not be fair to require Mr. Brown to answer questions directed to matters outside the scope of his report because it could give the plaintiff an advantage not available to the defendant.  Here I refer to paragraph 29 of Barratt.  Moreover, to permit such cross-examination would cast a chill over the ability of counsel for both plaintiffs and defendants to properly prepare their client’s case and also to answer the other party’s case.  In the result, the objection of the defendant is sustained.