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Privileged communications

Litigation privilege invoked by insurer could be asserted

Litigation privilege. Fire damaged residence and one of insurer’s claims adjusters investigated claim. Syndic of Chambre de l’assurance de dommages later received information to effect that adjuster had made certain errors in managing file. In course of her inquiry, syndic asked insurer to send her complete copy of its claim file. Insurer refused to do so on basis that some of requested documents were protected by litigation privilege. Syndic filed motion for declaratory judgment, arguing that s. 337 of Act respecting the distribution of financial products and services (Que.) created obligation to produce “any (…) document” concerning activities of representative whose professional conduct was being investigated. Syndic further argued that litigation privilege should be applied more flexibly than solicitor-client privilege as it was less important. Trial judge concluded that litigation privilege could not be abrogated absent express provision and syndic appealed. Court of Appeal upheld trial judge’s judgment. Syndic appealed before Supreme Court of Canada. Appeal dismissed. Litigation privilege is fundamental principle of administration of justice . It is class privilege that exempts communications and documents that fall within its scope from compulsory disclosure, except where one of limited exceptions to non-disclosure applies. Any legislative provision capable of interfering with litigation privilege should be read narrowly. Legislature may not abrogate that privilege by inference, but may only do so using clear, explicit and unequivocal language. Because s. 337 of Act provided only for production of “any (…) document” without further precision, it did not have effect of abrogating privilege. It followed that insurer was entitled to assert litigation privilege in this case and to refuse to provide syndic with documents that fell within scope of litigation privilege. None of exceptions to its application justified lifting privilege in this case. Therefore, courts below were right to hold that litigation privilege invoked by insurer could be asserted against syndic.
Lizotte c. Aviva Cie d’assurance du Canada (2016), 2016 CarswellQue 10692, 2016 CarswellQue 10693, 2016 SCC 52, 2016 CSC 52, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); affirmed (2015), 2015 CarswellQue 384, 2015 QCCA 152, Bich J.C.A., St-Pierre J.C.A., and Gagnon J.C.A. (C.A. Que.).

Criminal Law

Pre-trial procedure

Search without warrant

Totality of circumstances supported conclusion that arrest was lawful

Officer observed accused’s vehicle speeding and pulled him over. Officer saw police scanner above driver’s-side window visor and noticed that body of vehicle was higher than usual. When asked for his license and registration, accused checked his window visor and advised that he could not locate them. Officer requested that he check glove box, and while accused was leaning over saw money accused appeared to have been sitting on and unsheathed hunting knife next to driver-side door. Accused was arrested for possession of weapon dangerous to public peace and pat down search revealed bag of cocaine. Later strip search revealed more small bags of cocaine. voir dire was held on admissibility of evidence under section 8 and section 9 of the Canadian Charter of Rights and Freedoms. Evidence was admissible and accused was convicted of possession of cocaine for the purposes of trafficking and possession of a weapon dangerous to the public peace. Accused unsuccessfully appealed to Newfoundland and Labrador Court of Appeal, which found that arrest was lawful. Accused appealed. Appeal dismissed. Arrest was lawful since arresting officer had reasonable and probable grounds to believe that accused had committed indictable offence. Totality of the circumstances, not mere presence of knife, supported trial judge’s conclusion that arrest was lawful.

R. v. Diamond (2016), 2016 CarswellNfld 422, 2016 CarswellNfld 423, 2016 SCC 46, Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); affirmed (2015), 2015 CarswellNfld 518, 2015 NLCA 60, B.G. Welsh J.A., M.F. Harrington J.A., and C.W. White J.A. (N.L. C.A.).

Privacy and Freedom of Information

Collection of personal information

Mortgagee was compelled to disclose discharge statement

Creditor loaned homeowners $35,000. Homeowners defaulted on loan. Creditor obtained judgment against homeowners but required discharge statement (statement) from bank holding mortgage on homeowners’ property (mortgagee). Mortgagee refused to provide statement without homeowners’ consent under Personal Information Protection and Electronic Documents Act (PIPEDA). Creditor obtained orders to examine homeowners in aid of execution. Motion judge refused both of creditor’s motions to compel mortgagee to disclose statement, considering himself bound by 2011 appellate decision. Majority of Court of Appeal dismissed creditor’s appeal, holding that s. 7(3)(c) exception did not apply, that statement was “personal information” homeowners did not impliedly consent to disclosure of, and that creditor could obtain statement by obtaining examination order under R. 60.18(6)(a) of Rules of Civil Procedure. Dissenting judge would have ordered mortgagee to provide statement. Creditor appealed. Appeal allowed; statement was ordered disclosed. Order sought by creditor was “order made by court” under s. 7(3)(c), statement fell within s. 7(3)(b) exception to consent requirement, and homeowners impliedly consented to statement’s disclosure. PIPEDA did not interfere with courts’ ability to make orders or with rules regarding record production or debt collection disclosure. Requiring creditor to bring another motion flew in face of increasing concerns about access to justice. Judgment creditor who served debtor with motion to obtain disclosure was entitled to order for disclosure and should not be required to undergo further procedure to realize debt. Homeowners also impliedly consented to disclosure to creditor when they gave mortgage. Information in statement was less sensitive than other financial information and was generally available to public except that statement disclosed current balance at single point in time. In determining individual’s reasonable expectations under PIPEDA, whole context was important, including legitimate business interests of other creditors. Statement was not just private matter between mortgagee and mortgagor. Finally, disclosure to person requiring information to exercise established legal right was different from disclosure to curious party with no legal interest in property.
Royal Bank of Canada v. Trang (2016), 2016 CarswellOnt 18044, 2016 CarswellOnt 18045, 2016 SCC 50, 2016 CSC 50, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); reversed (2014), 2014 CarswellOnt 17254, 2014 ONCA 883, Alexandra Hoy A.C.J.O., John Laskin J.A., Robert J. Sharpe J.A., E.A. Cronk J.A., and R.A. Blair J.A. (Ont. C.A.).

Business Associations


Oppression claim was properly dismissed

R and M incorporated company but rarely complied with requirements of Canada Business Corporations Act. In May 2005, M resigned as officer and director of corporation. Corporation alleged M had also resigned as shareholder and accordingly transferred his shares to R. M applied for oppression remedy under s. 241 of Act, alleging he was still shareholder. Trial judge dismissed M’s claim, rejecting M’s version of events and finding that as of May 2005, M did not wish to be shareholder and asked to be removed. Court of Appeal dismissed M’s appeal. M appealed to Supreme Court of Canada. Appeal dismissed. Oppression claim was properly dismissed. Trial judge’s factual findings were not reviewable because no palpable and overriding error had been made. Fact that corporation fails to comply with requirements of Act does not, on its own, constitute oppression. M could have had no reasonable expectation of being treated as shareholder: he no longer was and expressly demanded not to be so treated. Corporation’s failure to observe corporate formalities in removing M as shareholder in accordance with his wishes could not be characterized as unfairly prejudicial to extent that omission deprived him of shareholder status.
Mennillo v. Intramodal inc (2016), 2016 CarswellQue 10615, 2016 CarswellQue 10616, 2016 SCC 51, 2016 CSC 51, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); affirmed (2014), 2014 CarswellQue 10625, 2014 QCCA 1515, Gagnon J.C.A., Vézina J.C.A., and St-Pierre J.C.A. (C.A. Que.).

Alternative Dispute Resolution

Question of law

Leave to appeal under arbitration legislation ought not to have been granted

Parties entered agreement by which petitioner, U Inc., leased fibre optic strands to BNS. By letter, BNS sought to exercise renewal option and requested that petitioner waive six months’ notice requirement. BNS did not include payment of $1.00 renewal fee. Petitioner later claimed that letter did not constitute valid exercise of option. Arbitrator found that BNS exercised option and that proposed modification of option was tendered only after making of new bilateral contract. Arbitrator found, in alternative, that if letter was not effective exercise of option, petitioner was estopped from relying on any defects in letter. Petitioner sought leave to appeal, and appealed. Leave was granted and appeal was allowed. Chambers judge found, in part, that arbitrator erred by failing to follow principle that qualified acceptance of offer constitutes counter-offer. Judge found, in part, that arbitrator erred by failing to accept parties’ agreement as to required consideration. Judge found, in part, that petitioner had no obligation to advise BNS that its purported exercise of option was defective. Judge ordered that award be amended to find that agreement required $1.00 as consideration for exercise of option; letter was qualified acceptance of option offer and was thus counter-offer extinguishing original offer; and, petitioner was not estopped from relying on defects in purported exercise of option. BNS appealed. Appeal was allowed, order was set aside, application for leave to appeal award was dismissed, and award was reinstated. Court of Appeal (C.A.) found that petitioner could not establish pure question of law arising from arbitrator’s interpretation of article of agreement and letter. C.A. found that threshold requirement for granting of leave to appeal under arbitration legislation was not met and leave to appeal ought not to have been granted. C.A. found that there was no consensus between parties on meaning of words in contractual documents. C.A. found that arbitrator had to determine true meaning of words in context and surrounding circumstances in which they were written. C.A. found that this engaged questions of mixed fact and law, which were not reviewable under statute provision. Petitioner appealed. Appeal dismissed. Court was of view that appeal should be dismissed substantially for reasons of C.A..
Urban Communications Inc v. BCNET Networking Society (2016), 2016 CarswellBC 3056, 2016 CarswellBC 3057, 2016 SCC 45, 2016 CSC 45, McLachlin C.J.C., Abella J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., Brown J., and Rowe J. (S.C.C.); affirmed (2015), 2015 CarswellBC 1785, 2015 BCCA 297, D. Smith J.A., Bennett J.A., and Willcock J.A. (B.C. C.A.).

Judges and courts

Justices, magistrates and provincial courts

Independent review of initial remuneration of judges appointed to new judicial office is necessary

In 2004, government of Quebec reformed its regime of justices of peace by creating two categories of justices of peace. Government set starting remuneration of new category well below the previous levels. In 2008, association of justices of peace and its individual members made application in Superior Court arguing that provisions relating to setting and review of remuneration violated financial security guarantee of judicial independence. Application judge dismissed application, holding that the government’s decision had been validated by a special committee and that candidates applied for the office with full knowledge of the situation. Court of Appeal dismissed appeal brought by association and its members . Court of Appeal considered level of remuneration that was fixed to be high enough to guarantee independence of new justices of the peace. Association and its members appealed. Appeal allowed in part. In order to adequately protect judicial independence, whenever new judicial office is created, independent review of initial remuneration of judges appointed to new office is always necessary. Review by remuneration committee should take place within reasonable time after appointment of the new judges. In present case, reform breached financial security guarantee of judicial independence because remuneration for 2004 to 2007 was not reviewed within reasonable time after new appointments. Indeed, the remuneration for that period has never been reviewed. Since Act created new judicial office, initial remuneration of all judges appointed to this office needed to be reviewed retroactively, within reasonable time after their appointment. As ss. 27, 30 and 32 of Act did not provide for retroactive committee review within reasonable time, these sections infringed institutional financial security guarantee of judicial independence, and were thus contrary to s. 11(d) of Canadian Charter of Rights and Freedoms and preamble to Constitution Act, 1867.
Conférence des juges de paix magistrats du Québec v. Quebec (Attorney General) (2016), 2016 CarswellQue 9318, 2016 CarswellQue 9319, 2016 SCC 39, 2016 CSC 39, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); reversed (2014), 2014 CarswellQue 14611, 2014 CarswellQue 9133, 2014 QCCA 1654, Bouchard J.C.A., Vauclair J.C.A., and Dalphond J.C.A. (C.A. Que.).

Civil Practice and Procedure

Class and representative proceedings

Class proceedings acts gave judges power to sit outside of province

Three separate class actions took place on behalf of individuals infected with hepatitis C, as result of tainted blood supply between 1986 and 1990. B.C. and Quebec courts oversaw actions involving those provinces’ residents, while Ontario action involved Ontario residents and those from all other provinces. Settlement agreement was made in 1999, authorizing three provincial courts to supervise claims and requiring agreement among courts for settlement to take effect. In 2012, class counsel made motions relating to settlement agreement, proposing that judges from all 3 provinces hear motion sitting in one location. Provincial governments opposed motion, stating that judges lacked jurisdiction to sit outside own province. On motions for directions, motions judges in all 3 provinces rules that they could sit outside province for purpose of settlement agreement motions. Ontario and B.C. appealed from judgment. Court of Appeal in both provinces found that it was permissible for provincial judges to conduct hearing, with use of video or telephone link. Representative plaintiffs appealed to Supreme Court, stating that link was not necessary for judges to hear matter outside of province. Ontario cross-appealed from judgment, claiming that there was no power for judges to hear matter outside of province. Parties agreed before Supreme Court hearing that judges had discretion to hear matter. Source of discretionary power and conditions of its use were still live issues. Appeal allowed; cross-appeal dismissed. Judge had discretion in national class action, to hold hearing in conjunction with other judges in related class actions. Discretion could be used as long as court’s coercive powers were not necessary, and hearing was not contrary to law of governing jurisdiction. Class proceedings acts in both Ontario and B.C. gave judges power to sit outside of province. Relevant law gave judges inherent jurisdiction to control own processes. Video link was not requirement. Court was to be guided by principles, including whether sitting outside province would impinge on sovereignty of another province. Court was to take into accounts benefits and costs of out-of-province proceeding. Court was to determine whether terms such as video link or extraordinary costs were necessary.
Endean v. British Columbia (2016), 2016 CarswellBC 2891, 2016 CarswellBC 2892, 2016 SCC 42, 2016 CSC 42, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); reversed (2014), 2014 CarswellBC 363, 2014 BCCA 61, Saunders J.A., Tysoe J.A., and Goepel J.A. (B.C. C.A.). (S.C.C.); reversed (2015), 2015 CarswellOnt 3336, 2015 ONCA 158, R.G. Juriansz J.A., H.S. LaForme J.A., and P. Lauwers J.A. (Ont. C.A.).

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An estate trustee who took an ‘egregious' position in litigation has been ordered to personally pay more than $140,000 in costs. Will this ruling serve as an appropriate caution to executors on how they conduct themselves in litigation?
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