Document Disclosure and Litigation Privilege – A Potentially Difficult Test to Meet
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:
 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?
 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,  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.
 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.
 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.
Adjusting Stage, bc injury law, Celli v. White, disclosure, discovery, document disclosure, Dominant Purpose, litigation privilege, Master Caldwell, privilege
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