[1995] OLRB Rep. May 627
3317-94-U; 3680-94-R Laundry and Linen Drivers and Industrial Workers, Local 847 Affiliated With the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Applicant v. Careful Hand Laundry and Dry Cleaners Limited, Kirlin Leasing Limited, Responding Parties; Laundry and Linen Drivers and Industrial Workers, Local 847 Affiliated With the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Applicant v. Careful Hand Laundry and Dry Cleaners Limited and/or 531715 Ontario Limited c.o.b. as Atripco Delivery Service and/or Gopher Express Delivery Limited, Kirlin Leasing Limited, Responding Parties
BEFORE: Lee Shouldice, Vice-Chair, and Board Members J. A. Ronson and P. R. Seville.
APPEARANCES: Susan Philpott, Dan Serbin and others for the applicant; C. E. Humphrey, K. J. Murray and others for the responding party Careful Hand Laundry and Dry Cleaning Limited; no one appearing for 531715 Ontario Limited c.o.b. as Atripco Delivery Service and/or Gopher Express Delivery Service.
DECISION OF THE BOARD; May 31, 1995
These Board files are, first, an unfair labour practice application asserting a violation of sections 65 and 67 of the Act, and, second, an application pursuant to sections 64 and 1(4) of the Labour Relations Act in which the applicant (hereinafter "the union") asserts that the responding parties participated in the sale of all or part of a business, or, alternatively, are related employers for the purposes of the Labour Relations Act (hereinafter "the Act").
These matters first came on for hearing on April 11, 1995. At that time, the parties engaged in discussions relating to the production of documents and the possibility of settlement. To the extent that the discussions revolved around settlement, they were unsuccessful, and the matters proceeded before this panel of the Board on April 12, 1995.
At the outset of the hearing, counsel for the applicant advised the Board that the parties had agreed to adjourn the sale of a business/related employer application pending the determination of the unfair labour practice complaint. In order to expedite the hearing of the latter complaint, the parties had agreed, for the purposes of that proceeding only, to the accuracy of certain factual allegations contained in the response to the sale of a business/related employer proceeding filed by 531715 Ontario Limited c.o.b. as Atripco Delivery Service and/or Gopher Express Delivery Limited (hereinafter "Atripco"). Counsel advised the Board of those factual allegations which had been agreed to for the purpose of the unfair labour practice complaint and, thereafter, counsel for the responding party Careful Hand Laundry and Dry Cleaning Limited (hereinafter "Careful") called his first witness.
During the cross-examination of Careful's first witness, an objection was raised by counsel for Careful regarding a certain line of questions to be raised by counsel for the union. Due to the significance of the line of questions desired to be put to the witness (the substance of which will be elaborated upon below), the Board adjourned the hearing until the next day, in order to allow counsel to prepare argument on the matter. Full argument was entertained by the Board the next day on the issue in dispute. Our decision and reasons follow.
In order to appreciate the significance of the issue argued before the Board, it is important that the background to the complaint be described, at least to some extent. The union alleges that Careful violated sections 65 and 67 of the Act, in part, by laying off certain drivers because of their membership in the union. Certain other allegations of impropriety are also raised but are not immediately relevant to the procedural ruling in dispute. In response to the union's allegations, Careful states that its decision to lay off its drivers (and, at the same time, contract out that work to a third party) was due to economic circumstances and was entirely devoid of any anti-union animus.
The first witness called by Careful was Mr. Keith Murray, a barrister and solicitor employed at all relevant times by the solicitors acting for Careful, Stringer, Brisbin, Humphrey. It would appear that throughout the events leading to the union's decision to bring the unfair labour practice complaint, Mr. Murray acted as the solicitor for Careful. His testimony to date establishes that he had no involvement with Careful until September, 1994, at which time he returned a telephone call made to the law firm from one David Klegerman, Careful's General Manager. It would appear, from the evidence before the Board to date, that at that point he commenced his relationship with Careful, providing them with advice in his capacity as a barrister and solicitor.
Mr. Murray testified before the Board regarding a number of events and incidents relevant to this proceeding which occurred between November 8, 1994 and approximately December 15, 1994. In particular, Mr. Murray gave testimony about a meeting that had occurred on November 8, 1994, involving himself, Mr. Sidney Cheisky (the principal of Careful) and Mr. Klegerman, on the one hand, and Mr. Dan Serbin and one other individual who attended on behalf of the union, on the other. Notes that were prepared by Mr. Murray prior to the meeting were entered into evidence on consent of the parties. Mr. Murray testified that he had, in essence, read from the notes at the meeting. The thrust of Mr. Murray's testimony is that he advised the union at the meeting that Careful had decided to contract out the delivery functions effective January 1, 1995, and of the reasons for the decision. Other testimony respecting the course of that meeting was also tendered by Mr. Murray.
Thereafter, Mr. Murray testified as to telephone discussions he had with Mr. Ron Davis, a barrister and solicitor currently employed by Koskie and Minsky, the solicitors acting for the union. Mr. Murray also identified certain correspondence which passed between the two solicitors. As well, Mr. Murray gave evidence about a meeting which was arranged for (and, in fact, took place on) November 24, 1994 in order to negotiate an adjustment plan respecting the drivers. The evidence of Mr. Murray respecting that meeting focused on the discussions held with those in attendance, as well as a private conversation that he had with Mr. Serbin in the lobby of the building where the meeting was held. Much of Mr. Murray's testimony touched on his response (both at the meeting and subsequently) to the union's request for financial information, and for the identity of the company to which Careful would be contracting out its delivery services.
Mr. Murray also testified in some detail to his knowledge of a meeting held between Mr. Cheisky and Mr. Serbin on December 5, 1994. Mr. Murray testified that Mr. Chelsky had indicated to him on that same date that Mr. Serbin had advised Mr. Cheisky that the purpose of this meeting was to "settle their problems or something to that effect". Mr. Murray amplified his testimony on this point, advising the Board of his client's comments to him respecting Mr. Chelsky's discussions with Mr. Serbin, both prior to and at the lunch meeting. The testimony of Mr. Murray was to the effect that certain offers to settle the matters in dispute were made at this luncheon, and that, in a subsequent telephone discussion with Mr. Cheisky, he advised Mr. Chelsky not to settle the matter on the terms said to have been offered by Mr. Serbin.
In cross-examination, counsel for the union asked Mr. Murray about his initial involvement with Careful as a client. Mr. Murray described the circumstances surrounding his return of Mr. Kiegerman's telephone call. Mr. Murray, in response to a question posed to him, acknowledged that he had made a note of that telephone call, and that it was in the hearing room. Counsel then requested that Mr. Murray produce the note, which request brought an immediate objection from counsel for Careful. During the discussion that followed the objection, counsel for the union indicated that she desired to cross-examine Mr. Murray on his discussions with his client during the time frame of September, 1994 to the date that the unfair labour practice proceeding was commenced, in order to establish whether his client had a "plan" respecting the contracting out of delivery services and/or the bargaining of an adjustment plan which violated the Act in the manner alleged by her client. The Board directed the parties to address the propriety of this line of questioning at the start of the next hearing date.
Counsel for Careful, in his submissions, noted that the instant situation involved one of direct solicitor-client communications, and asserted that the concept of solicitor-client privilege applied to the entire scope of those communications, whether they were in the anticipation of litigation or not. The privilege is one of substantive law and not procedure; its purpose is to ensure that both legal counsel and his or her client can maintain the confidentiality of their discussions, so as to encourage citizens to seek the advice of their solicitors and to be entirely open with counsel regarding the factual circumstances in question.
Counsel also addressed the issue of the possible waiver of the privilege. Counsel noted that the testimony of Mr. Murray respecting the advice given to Mr. Chelsky was limited to his discussion with Mr. Chelsky on December 5, 1994. Furthermore, the purpose of the testimony given was not to establish the advice given but, instead, to buttress the credibility of his client relative to that of Mr. Serbin (which issue would seem to a live one, in light of the pleadings before the Board). Counsel submitted that the advice given by Mr. Murray to Mr. Chelsky was related only to the propriety of entering into the settlement proposed by Mr. Serbin, and was separate and distinct from any advice given regarding the contracting out of delivery services, or other matters. Accordingly, counsel asserted that all of the advice provided to Mr. Chelsky by Mr. Murray went beyond proper cross-examination and offended the principles upon which the solicitor-client privilege is based. During argument, counsel referred to the following authorities: Manes, R.D. and M. Silver, Solicitor-Client Privilege in Canadian Law (Butterworths); Solosky v. R. (1979), 1979 CanLII 9 (SCC), 50 C.C.C. (2d) 495 (S.C.C.); Power Consolidated Pulp Inc. v. British Columbia Resources In vestment Corp. 1988 CanLII 3214 (BC CA), [1989] 2 W.W.R. 679 (B.C.C.A.); and Re Director of Investigation and Research and Shell Canada (1975), 1975 CanLII 2217 (FCA), 55 D.L.R. 713 (F.C.A.).
Counsel for the applicant, in her submissions, conceded that opposing counsel's characterization of the law was accurate - that the privilege respecting solicitor-client communications is a wide one and that it covers almost all communications between solicitors and their clients. She asserted, however, that there were some exceptions and that the circumstances before the Board fell into one or more of those exceptions.
Counsel relied, first, upon the concept of waiver. It was acknowledged that the solicitor-client privilege was the client's to waive, and not the lawyer's. However, counsel relied upon the principle that legal counsel can, by placing himself or herself on the witness stand, reflect the ostensible authority of his or her client to waive the privilege which would otherwise attach to certain information. Counsel noted that the proceeding here is largely focused upon the conduct of Careful. Mr. Murray has been involved since September, 1994 with this client of his firm and, perhaps, was involved before then, when the union organized the drivers. Mr. Murray clearly was involved with all conduct of the employer subsequent to September, 1994. Counsel asserted that Careful, presumably, acted upon the advice given by Mr. Murray. On the basis of Mr. Murray's testimony, Mr. Chelsky did act on his advice regarding the rejection of Mr. Serbin's purported offer to settle the matter. In these circumstances, it was asserted, Careful "has brought us to the edge of a precipice". By putting Mr. Murray on the stand as a witness, Careful has raised issues upon which the union wishes to cross-examine. Careful has, it was submitted, put forth its counsel as an important witness. Having started down that road, it was asserted that Careful cannot now seek to shelter all of the communications between the solicitor and his client since September, 1994. Cited as authority during argument were Land v. Kaufman (1991), 1 C.P.C. (3d) 234 (Ont. Ct. Justice, Gen Div.), Lloyd's Bank Canada v. Canada Life Assurance Co. et al (1991) 47 C.P.C. (2d) 157 (Ont. Ct. Justice, Gen. Div.), and Sopinka, J, and S. Lederman and A. Bryant, The Law of Evidence in Canada (Butterworths).
Counsel for the union also relied upon the principle that the solicitor-client privilege is waived when the communication relates to "unlawful conduct". Counsel asserted that if the communications between solicitor and client reflect an intention to commit a breach of the Act, they are no longer protected by the privilege. Relied upon by counsel as authority was Sopinka et al., The Law of Evidence in Canada (Butterworths), supra.
Having considered carefully all of the arguments raised by counsel, we are in substantial agreement with the position put forward by counsel for Careful. We are of this view for the following reasons.
It is important to keep in mind, at the outset, that the privilege which attaches to communications between a solicitor and his or her client is a privilege which dates back to Elizabethan times, and is one which ought not to be impinged upon except in the most narrowest of circumstances. In Solosky v. The Queen, supra, the Supreme Court of Canada described the concept of privileged communications between a solicitor and his or her client as having long been recognized as "fundamental to the due administration of justice" and as "a fundamental civil and legal right" (see also Descoteaux v. Mierzwinski (1982), 1982 CanLII 22 (SCC), 141 D.L.R. (3d) 590, at p.601 (S.C.C.)). The rationale of the privilege was described by Manes and Silver, in Solicitor-Client Privilege in Canadian Law, supra, at p. 5:
Although privilege may act as a fetter on the discovery of truth, its continued existence demonstrates the priority given to the inviolability of solicitor-client communications. The client must be assured that what the client confides to his solicitor is protected from disclosure, otherwise the client will be restrained in what the client chooses to disclose, and as a result, the solicitor's advice will be flawed.
Our society is a complex one; for some individuals the need to seek legal advice from solicitors on a wide range of issues arises on an almost daily basis. Advice respecting labour relations matters falls squarely within the scope of the solicitor-client privilege; indeed, circumstances in which legal advice respecting labour relations matters is sought can be as complex as in any other area of law. The privilege which is attached by the courts to legal advice provided by solicitors to their clients ensures that any advice given to the client is based upon all of the relevant facts known to the client, and the law has developed in a manner to ensure that the client is not in any way inhibited in raising with his or her legal counsel certain propositions or factual matters for fear that they will, at a later date, be disclosed by the solicitor, except with the permission of the client. There is no reason why these same principles ought not to apply to solicitor's advice given respecting labour relations matters.
As is noted in a number of the authorities provided to the Board by counsel, there are a number of narrow exceptions to the privilege. A number of these were discussed by the Supreme Court of Canada in Solosky v. The Queen, supra, at page 507. None of the exceptions enumerated therein were said by counsel for the union to have any applicability to the circumstances before us, save and except one relating to communications "in order to facilitate the commission of a crime or a fraud", which will be discussed in more detail below. As noted above, however, counsel did rely upon the concept of waiver for the proposition that she could examine Mr. Murray on the advice given to Careful during the fall of 1994.
There is no doubt that the solicitor-client privilege can be lost by way of waiver; that is, the client can, either expressly, or by implication, waive the privilege normally attached to communications with his or her solicitor (see, for example, John Kohut [1991] OLRB Rep. Dec. 1367, at para. 16, where a client expressly waived such privilege in the context of a duty of fair representation complaint). It would appear to the Board that, to the extent that Mr. Murray's testimony regarding the December 5, 1994 discussion with Mr. Chelsky did abrogate the solicitor-client privilege, Careful had at the very least implicitly waived any privilege respecting that discussion.
Counsel for the applicant, however, asks the Board to go further. Counsel asserts that, by implication, Careful has waived any privilege that protected any of its communications with its solicitors. Counsel referred the Board to the following excerpt from The Law of Evidence in Canada, supra, at pages 666 and 667:
As to what constitutes waiver by implication, Wigmore said:
Judicial decision gives no clear answer to this question. In deciding it, regard must be had to the double elements that are predicated in every waiver, i.e. not only the element of implied intention, but also the element of fairness and consistency. A privileged person would seldom be found to waive, if his intention not to abandon could alone control the situation. There is always also the objective consideration that when his conduct touches a certain point of disclosure, fairness requires that his privilege shall cease whether he intended that result or not. He cannot be allowed, after disclosing as much as he pleases, to withhold the remainder. He may elect to withhold or to disclose, but after a certain point his election must remain final.
Whether intended or not, waiver may occur when fairness requires it, for example, if a party had taken positions which would make it inconsistent to maintain the privilege..
The notion of fairness has also been invoked as a basis for waiver when the party directly raises in a pleading or proceeding the legal advice that he or she received, thereby putting that advice in issue. ...
We accept as accurate the statement of the law which is contained in The Law of Evidence in Canada, set out immediately above. There may well be circumstances raised before the Board in which one party, by calling certain otherwise privileged testimony from a solicitor (or, for that matter, from someone with direct knowledge of the advice given by a solicitor to that party), may implicitly place the entire extent of the advice given into issue. The essence of the above excerpt is that one party ought not be able to voluntarily introduce part of the privileged advice given by a solicitor to bolster his or her case without providing an opposing party the opportunity to probe all of that advice in cross-examination. We have no difficulty with that proposition. However, we fail to see how it can apply to the facts before us, except in a very limited way.
Mr. Murray testified to the advice given to Mr. Chelsky during his December 5, 1994 telephone discussion. By doing so, Careful has waived any solicitor-client privilege that attached to this particular advice; that is, it would be unfair to allow Careful to rely upon this testimony without providing the union an opportunity to probe the testimony given by Mr. Murray respecting his advice given on that occasion. However, at no other time did Mr. Murray testify regarding legal advice given to Mr. Chelsky or, for that matter, any other official of Careful. Except to the limited extent described above, Careful does not, by way of the pleadings filed before the Board, or through Mr. Murray's testimony, seek to rely on any of the advice provided to Careful from September, 1994 to date. Accordingly, it is difficult, if not impossible, to identify any "element of fairness or consistency" compelling the Board to conclude that Careful had, in some way, implicitly waived its solicitor-client privilege respecting the advice given by Mr. Murray, if any, during the fall of 1994. The waiver by Careful of the privilege attached to the December 5, 1994 discussion between Mr. Chelsky and Mr. Murray does not provide the union with "carte blanche" to probe any other privileged discussions in order to discover whether there is any substance to its allegations.
With respect to the second exception to the concept of solicitor-client privilege relied upon by counsel for the union, it was asserted that there is no privilege attached to solicitor-client communications if their purpose is to facilitate a breach of the Act. No case authority was provided to the Board, and very little argument was put forward in support of the submission.
In Solosky v. The Queen, supra, Dickson J. made the following observation:
... if a client seeks guidance from a lawyer in order to facilitate the commission of a crime or a fraud, the communication will not be privileged and it is immaterial whether the lawyer is an unwitting dupe or knowing participant. The classic case is R. v. Cox and Railton (1884), 14 Q.B.D. 153, in which Stephen, I., had this to say (p. 167): "A communication in furtherance of a criminal purpose does not 'come in the ordinary scope of professional employment'."
The authors of The Law of Evidence in Canada, supra, make reference at p. 644 of the text that "there is no reason why this exception to the solicitor-client privilege should not also include those communications made with a view to perpetrating tortuous conduct which may not become the subject of criminal proceedings". Authority is cited both in favour of and against the proposition made in the text. In Ontario, the case of R. v. Church of Scientology (No.2), (1984), 1984 CanLII 2141 (ON HCJ), 44 C.P.C. 87 (Ont. H.C.J.) is cited in support of the proposition; Rocking Chair Plaza (Bramalea) Ltd. v. City of Brampton (1988), 29 C.P.C. (2d) 82 (Ont. H.C.J.) is cited as authority for the contrary. Both cases stand for the propositions cited; the latter decision rejects the approach adopted in the former.
We have reviewed the above decisions. We are not prepared to establish the exception to solicitor-client privilege proposed by counsel for the union. The above authorities indicate quite clearly that there is no consensus in Ontario courts as to whether the "crime or fraud" exception to solicitor-client privilege extends beyond those types of communications. In the absence of any authority conclusively determining this issue, we are of the view that no such broader exception exists at law.
Accordingly, for the reasons set out above, we uphold the objection of counsel for Careful. To the extent that questions are to be put to Mr. Murray respecting advice given by him to Careful, counsel for the applicant will be limited to putting questions to Mr. Murray respecting his advice to Mr. Cheisky given on or about December 5,1994 relating to the offer of settlement alleged to have been made by Mr. Serbin.
The unfair labour practice proceeding before the Board is scheduled to come on for hearing for seven more days, commencing on September 18, 1995. This panel is seized of that matter. The sale of a business/related employer proceeding before the Board is hereby adjourned sine die, until the disposition of this proceeding, as requested by the parties.