COURT FILE NO.: 19-68402 MOTION HEARD: 20191217 SEALED DOCUMENTS FILED: 20200117 REASONS RELEASED: April 15, 2020

SUPERIOR COURT OF JUSTICE – ONTARIO

BETWEEN:

MICHAEL WHITELL by his Litigation Guardian, KAREN LYNNE WHITELL Applicant

• and-

ROBERT ALLAN WHITELL Respondent

BEFORE: MASTER M.P. McGRAW

COUNSEL: S. Nash Email: snash@georgestreetlaw.ca -for the Applicant, Michael Whitell by his Litigation Guardian, Karen Lynne Whitell

R.R. Housen and R.L. Housen Email: richard@housenlaw.ca -for the Respondent, Robert Allan Whitell

Reasons For Endorsement

I. Introduction

[1] This is a motion by the Applicant, Michael Whitell (“Michael”) seeking an order compelling the Respondent Robert Allan Whitell (“Robert”) to produce 65 documents over which Robert claims solicitor-client and/or litigation privilege.

[2] This motion arises from refusals on Robert’s cross-examination held on July 30, 2019 on his affidavit sworn March 28, 2019. Robert’s affidavit was filed in response to Michael’s Application for, among other things, an order removing Robert as trustee of a trust established for Michael’s benefit by his late grandfather and declaring that Robert breached his duties as trustee.

[3] Like many family disputes, this matter has a contentious history, in this case between Robert and Michael’s mother and Litigation Guardian, Karen Lynne Whitell (“Karen”). This motion requires a balancing between a trustee’s right to assert privilege and a beneficiary’s right to receive communications related to legal advice obtained by a trustee.

II. The Parties, the Trust and the Applications

[4] Michael is 13-years old and suffers from autism and apraxia. He lives with his mother Karen who was appointed Litigation Guardian on February 2, 2019. Robert is Michael’s uncle and Karen’s brother. Robert Lorne Whitell was Michael’s grandfather and Robert’s and Karen’s father.

[5] Robert Lorne Whitell passed away on April 18, 2016. Robert was appointed trustee for his father’s estate (the “Estate”) pursuant to the Certificate of Appointment as Estate Trustee dated October 11, 2016. Pursuant to the Last Will and Testament of Robert Lorne Whitell dated June 20, 2014 (the “Will”) a special trust in the amount of $250,000 was established for Michael’s benefit (the “Trust”) and Robert was appointed trustee (the “Trustee”).

[6] The disputes between Karen and Robert began in 2014 when their parents were unable to manage their property. After the death of their mother, Irene Whitell, on September 15, 2014, Robert and Karen both held a continuing power of attorney for their father’s property. Karen requested access to her father’s property to support her and Michael. Robert refused to consent.

[7] On March 2, 2015, Karen brought an Application against Robert pursuant to the Substitute Decisions Act (Ontario) seeking support for her and Michael (the “SDA Application”). The SDA Application was resolved by mediation and a subsequent arbitration of the mediated settlement pursuant to an Arbitration Award dated July 18, 2016 (the “Arbitration Award”).

[8] In April 2016, after their father’s death, Robert retained Richard Housen as legal counsel with respect to the Estate. On September 21, 2016, Mr. Housen wrote to Karen and advised her that she was a beneficiary of the Estate and enclosed a copy of the Will. On October 13, 2016, Fareen Jamal, Karen’s litigation counsel in the SDA Application, wrote to Robert’s litigation counsel, Paul Veugelers, proposing certain terms to resolve outstanding issues regarding the SDA Application and the Arbitration Award. These terms included Robert’s removal as Trustee and the appointment of Karen in his place. Robert agreed to all terms except his removal.

[9] Ms. Jamal next wrote to Mr. Housen on November 8, 2016 confirming Robert’s terms to settle the SDA Application and the Arbitration Award. She also inquired into the status of the Trust and requested reimbursement for Michael’s tuition and activities. She did not raise Robert’s removal as Trustee. On November 10, 2016, Mr. Housen advised that he had received the Certificate of Appointment, would begin collecting and distributing Estate assets and would advise when the Trust was set up. By reply email that day, Ms. Jamal asked when Karen could expect to receive payment. Mr. Housen advised that day that he would be in a better position to respond after meeting with Robert later that week to discuss the administration of the Estate.

[10] By email dated November 23, 2016, Mr. Housen requested receipts for the reimbursements Karen requested and inquired into the obligations of Michael’s father to pay for a share of these expenses. Mr. Housen also advised that he and Robert were in the process of gathering the Estate assets and anticipated the Trust would be set up early in 2017.

[11] On April 7, 2017, Mr. Housen transferred $250,000 to Robert to set up the Trust. Later that month, Robert retained a financial advisor at CIBC Investor Services Inc. (“CIBC”) where the trust funds are held. By Engagement Letter dated August 3, 2017 (the “Engagement Letter”), Robert retained Mr. Housen to represent him with respect to the Trust.

[12] On December 1, 2017, Karen’s family lawyer, Fulvio Delibato wrote to Mr. Housen requesting information regarding disbursements and the value of the Trust’s assets. After numerous follow-ups, Mr. Housen advised by email on March 26, 2018 that the Trust had been set up and requested certain information regarding Michael. On March 29, 2018, Karen emailed Mr. Housen some information regarding Michael and asked for particulars of the Trust including the investment plan, an accounting and its value. She requested a response by April 10, 2018.

[13] Karen did not receive a response and retained her current counsel. On April 13, 2018, new counsel Alyson Sweetlove wrote to Mr. Housen requesting, among other things, a statement of accounting, an investment plan and an explanation why no payments had been made for Michael’s benefit. After another follow-up, Ms. Sweetlove received a response from Mr. Housen on April 26, 2018 requesting receipts, a budget and any child support orders for amounts payable by Michael’s father. By letter dated May 14, 2018, Ms. Sweetlove provided receipts and requested reimbursement for Michal’s tuition and particulars of the Trust including investments. Mr. Housen advised that day that he would seek instructions. Ms. Sweetlove did not receive a response and followed up again on May 28, 2018. Mr. Housen emailed her on May 29, 2018 and advised that he would respond shortly. Ms. Sweetlove followed up again on June 18, 2018 requesting a response including Robert’s position on Karen’s proposal to enroll Michael in public school and hire a private tutor. By email that day, Mr. Housen apologized for the delay and advised that he would provide Robert’s response the next day. No response was received.

[14] On July 4, 2018, Ms. Sweetlove wrote to Mr. Housen and advised that she would refer the matter to her firm’s litigation department if a response was not received by July 13, 2018. On July 17, 2018, Mr. Housen emailed numerous investment and bank statements which he claimed was a complete accounting for the Trust. Ms. Sweetlove responded by letter dated July 30, 2018 advising that these statements were not a proper accounting and that an actual statement of accounting was required. Counsel continued to exchange correspondence intermittently, disputing and discussing the reimbursement of expenses, supporting receipts and the disclosure of information and documentation regarding the Trust.

[15] This Application was commenced on February 15, 2019. In his Amended Notice of Application, Michael seeks an order removing Robert as Trustee and appointing Don Lato, requiring Robert to provide a copy of the entirety of his solicitor’s file related to the Trust, an informal accounting from May 1, 2018 and the return of the $5,000 retainer and additional legal fees of $22,000 paid to Mr. Housen.

III. The Law and Analysis

Generally

[16] On his cross-examination, Robert refused to produce the entirety of Mr. Housen’s files with respect to the Trust. All of the disputed documents are included in Mr. Housen’s files and were created between April 18, 2016 and July 4, 2018 (the “Disputed Documents”). Michael concedes that any documents prepared after July 4, 2018 are subject to litigation privilege.

[17] Robert asserts both solicitor-client and litigation privilege over 64 Disputed Documents and solicitor-client privilege only over 1 Disputed Document. The number of documents at issue was reduced by discussions between counsel prior to the motion and some case management upon their attendance. The Disputed Documents were not available at the return of the motion and were filed under seal on January 17, 2020.

Solicitor-Client Privilege

[18] Solicitor-client privilege attaches to communications between a lawyer and client for the purpose of seeking or giving legal advice which is intended by the parties to be confidential (*Skysolar (Canada) Ltd. v. Economical Mutual Insurance Co.*, 2015 ONSC 4714 at para. 78). This privilege is fundamental to the proper functioning of the legal system and should only be set aside when absolutely necessary (*Alberta (Information and Privacy Commissioner) v. University of Calgary*, 2016 SCC 53 at paras. 26 and 34). The party asserting privilege bears the onus of establishing an evidentiary basis for its privilege claim on a balance of probabilities (Sky Solar at para. 73).

[19] It is a long-held principle that a trustee cannot claim solicitor-client privilege as against a beneficiary over any documents related to advice sought and obtained with respect to the administration of the trust (*Ballard Estate (Re)* (1994), 20 O.R. (3d) 50 (Gen. Div.) at paras. 2-4). A trustee and a beneficiary have a joint interest in the administration of the trust and legal advice sought by the trustee furthers the interests of the beneficiary (*Ballard Estate* at para. 19; *Wells (Estate) v. The Society for Pastoral Counselling Research*, 2014 ONSC 347 at paras. 12-13; *Chang v. Lai*, 2014 BCSC 128 at para. 16). Lederman J. explained this principle in Ballard Estate:

“Both counsel recognized the principle that communications passing between an executor or trustee and a solicitor are not privileged as against beneficiaries who are claiming under the will or trust. The rationale was set out in the classic statement of Lord Wrenbury in O'Rourke v. Darbishire, [1920] A.C. 581 at pp. 626-27, [1920] All E.R. Rep. 1 (H.L.), as follows:

If the plaintiff is right in saying that he is a beneficiary, and if the documents are documents belonging to the executors as executors, he has a right to access to the documents which he desires to inspect upon what has been called in the judgments in this case a proprietary right. The beneficiary is entitled to see all trust documents because they are trust documents and because he is a beneficiary. They are in this sense his own. Action or no action, he is entitled to access to them. This has nothing to do with discovery. The right to discovery is a right to see someone else's documents. The proprietary right is a right to access to documents which are your own. No question of professional privilege arises in such a case. Documents containing professional advice taken by the executors as trustees contain advice taken by trustees for their cestuis que trust, and the beneficiaries are entitled to see them because they are beneficiaries.

This principle was extended by the Supreme Court of Canada in the Goodman Estate v. Geffen case to the validity of a trust agreement after the death of the settlor. Wilson J. explained the reason for so doing as follows at p. 387 S.C.R., p. 235 D.L.R.:

In my view, the considerations which support the admissibility of communications between solicitor and client in the wills context apply with equal force to the present case. The general policy which supports privileging such communications is not violated. The interests of the now deceased client are furthered in the sense that the purpose of allowing the evidence to be admitted is precisely to ascertain what her true intentions were.

Similar considerations come into play when the issue is the disclosure of legal opinions obtained by a trustee. He or she is duty-bound to act in the best interests of the beneficiaries and the legal advice that the trustee sought and obtained from the lawyer was for the purpose of furthering their interests. In Talbot v. Marshfield (1883), 2 Dr. & Sm. 549, 62 E.R. 728, the court stated at p. 729:

[Counsel's opinion were] taken by the [trustees] to guide them in the exercise of a power delegated to them by the trusts of the will, and which, if exercised, would affect the interests of the other cestui que trust. The opinion was taken before proceedings were commenced or threatened, and in relation to the trust. Under these circumstances it appears to me that all the cestui que trust have a right to see that case and opinion. It was contended that it was not taken for the benefit of all the cestui que trust; but all the cestui que trust have an interest in the due administration of the trust and in the sense it was for the benefit of all, as it was for the guidance of the trustees in their execution of their trust.

Thus, there is no need to protect the solicitor-client communication from disclosure to those very persons who are claiming under the estate. The communications remain privileged as against third parties who are strangers or are in conflict with the estate, but as was stated in Stewart v. Walker, supra, not those who are claiming under the estate. And that is because the trustee and beneficiary have a joint interest in the advice as Phipson has suggested:

No privilege attaches to communications between solicitor and client as against persons having a joint interest with the client in the subject matter of the communication, e.g. as between . . . trustee and cestui que trust. (Phipson on Evidence, 14th ed. (London: Sweet & Maxwell, 1990)

Similarly, in Solicitor Client Privilege in Canadian Law (Markham: Butterworths, 1993) by R.D. Manes and M.P. Silver, the authors after recognizing that there can be no privilege asserted against beneficiaries of a trust over communications between a trustee and a trustee's solicitors with respect to the business and affairs of the trust, go on to state at pp. 62-63:

This rule is consistent with the principle underlying privileged communications between co-parties or joint clients, that the privilege does not maintain between them.

This "joint interest" basis for concluding that no privilege can be advanced by trustees as against beneficiaries is in keeping with the Supreme Court of Canada's recent principled approach to the law of evidence generally. …

There may well be appropriate exceptions to this "joint interest" rule, as in the case of Re Londonderry's Settlement, [1964] 3 All E.R. 855, [1965] Ch. 918 (C.A.), where it was more important to preserve the confidentiality of deliberations with respect to the trustees' exercise of discretion in deciding which beneficiaries were to take. Danckwerts L.J. explained the policy reasons for this exception at p. 861 as follows:

It seems to me that there must be cases in which documents in the hands of trustees ought not to be disclosed to any of the beneficiaries who desire to see them, and I think the point was a good one which was taken in the affidavit of Lord Nathan, that to disclose such documents might cause infinite trouble in the family, out of all proportion to the benefit which might be received from the inspection of the same. It seems to me that, where trustees are given discretionary trusts which involve a decision on matters between beneficiaries, viewing the merits and other rights to benefit under such a trust, the trustees are given a confidential role and they cannot properly exercise that confidential role if at any moment there is likely to be an investigation for the purpose of seeing whether they have exercised their discretion in the best possible manner.” (*Ballard Estate* at paras. 2-4, 11-19, 21-22)

[20] As the passage above makes clear, a beneficiary’s entitlement to obtain communications between a trustee and the trustee’s counsel is not unlimited. The court will not allow the production of any documents related to a separate and distinct matter in which a beneficiary and a trustee are in an adversarial relationship (*Wells* at para. 15; *Chang* at para. 17). Where the beneficiary and the trustee are adverse in interest, there is no joint interest that compels the disclosure of communications that would normally be protected by solicitor-client privilege (*Ballard Estate* at para. 15; *Chang* at para. 17). This exception was summarized in *Haydu v. Nagy*, 2012 BCSC 1870, cited in Wells:

“…a distinction must be drawn between opinions procured by the trustee for its own protection in relation to claims made against it and opinions received in the course of determining the proper distribution of the trust. A beneficiary is entitled to the latter, but not to the former.” (*Haydu* at para. 25; *Wells* at paras. 15).

[21] There is a further qualification. In Ballard Estate, Lederman J. held that in proceedings where a beneficiary is alleging lack of good faith or breach of fiduciary duty, documents relevant to those claims are to be made available to the beneficiary:

“Moreover, the cases have stated that, whatever approach to the claim of privilege is taken, in actions where the beneficiary is alleging lack of good faith or breach of fiduciary duty, this information is to be made available to him or her. In Froese v. Montreal Trust Co. of Canada, [1993] B.C.J. No. 1529 (B.C. Master), leave to appeal refused [1993] B.C.J. No. 1847, the Master put it this way at para. 27:

I am of the opinion that in the context of litigation in which the plaintiff alleges breach of duty in the administration of a trust and the documents which are sought to be examined are relevant to that issue the plaintiff may succeed on the basis of proprietary right if he makes out a prima facie case that he is a beneficiary of the trust and establishes that the documents are documents obtained or prepared by the trustee in the administration of the trust and in the course of the trustee carrying out his duties as trustee. In my view, to require the plaintiff to pursue and complete an action to determine this preliminary issue before documents relevant to the issue of the breach of the alleged trust can be produced would not promote the economical and expeditious resolution of disputes and would not be in the interests of justice.” (*Ballard Estate* at paras. 27-28)

[22] Michael submits that since he is the beneficiary of the Trust, Robert, as Trustee, cannot assert solicitor-client privilege as against him over any of the Disputed Documents. Robert argues that given his previous disputes with Karen dating back to the SDA Application, the Arbitration Award and their parents’ property, he and Karen, and by extension Michael, were adverse in interest when the Disputed Documents were created such that solicitor-client privilege attaches to all of the Disputed Documents. In my view, the parties’ submissions are overreaching and ignore the qualifications in the case law and the circumstances in which the Disputed Documents were created. While the parties’ respective positions may apply to some of the Disputed Documents, they do not, as the parties assert, apply to all of them. In order to determine if solicitor-client privilege attaches to the Disputed Documents, it is necessary to review the surrounding circumstances to draw some broader conclusions which, as below, can then be applied to an inspection of the Disputed Documents.

[23] Turning to a consideration of these broader conclusions, there is no dispute that Michael is the beneficiary of the Trust. In his affidavits and on cross-examination, consistent with the Engagement Letter, Robert states that he retained Mr. Housen because he required legal advice regarding the administration and operation of the Trust. He also states that he did so for his own protection due to his belief that Karen would eventually take further steps to have him removed as Trustee to gain control of the Trust. To the extent to which Robert’s communications with Mr. Housen relate to the administration of the Trust, Michael has a joint interest and proprietary right in and to such advice and Robert cannot assert solicitor-client privilege as against Michael. However, this is subject to a consideration of whether Robert and Michael were in an adversarial relationship at any time, if litigation privilege applies and if the communications relate to Michael’s allegations that Robert breached his duties as Trustee.

[24] I reject Robert’s assertion that the administration of the Trust was concluded by April 1, 2017 when Mr. Housen transferred the trust funds to him so that he could set up the Trust. It is implausible that the administration of the Trust could have been concluded before it was even set up. Receiving the funds and setting up the bank accounts were initial tasks in Robert’s administration of the Trust. His subsequent consideration of Karen’s requests for reimbursement and disclosure, his requests for receipts and information and other issues addressed in the correspondence were also part of his ordinary course duties in the administration of the Trust for Michael’s benefit.

[25] Robert also submits that since the Trust is a discretionary trust which provides him with absolute discretion to favour one beneficiary over another, Michael is not entitled to receive the Disputed Documents as it would intrude on Robert’s ability to exercise his discretion in this confidential role (*Ballard Estate* at para. 22). Consistent with the Will and the record, Robert admitted on cross-examination that the Trust is for Michael’s benefit and welfare in particular to provide assistance related to his disabilities (Cross-Examination, Q. 47). There are no other beneficiaries of the Trust for Robert to consider. Accordingly, I reject Robert’s suggestion that any communications with Mr. Housen regarding the Trust should be protected by solicitor-client privilege on the basis that Robert is required as Trustee to exercise his discretion to favour one beneficiary over another.

[26] I also do not accept Robert’s submission that he and Michael were in an adversarial relationship during the entire period when the Disputed Documents were created. For the purpose of my analysis, I am satisfied that even though Karen was not appointed Litigation Guardian until February 2, 2019, as Michael’s mother, she was representing his interests as the beneficiary of the Trust during the relevant period. Robert argues that due to the SDA Application, the resulting Arbitration Award and Karen’s proposal that he be removed as Trustee on October 13, 2016, all of the Disputed Documents were created while Michael and Robert were adverse in interest. However, Robert rejected his proposed removal as a term of resolving this previous litigation and there is no evidence that it was raised again until after the Disputed Documents were created. When Ms. Jamal next wrote to Mr. Housen on November 9, 2016, she confirmed the other settlement terms and requested reimbursement for Michael’s expenses. She did not mention Robert’s removal. Substantially all of the correspondence between Karen, her various counsel and Mr. Housen after that time is related to issues regarding the administration of the Trust. In my view, there is a distinction between the remaining issues regarding the SDA Application and the Arbitration Award when Robert’s removal was raised and those related to the administration of the Trust. Therefore, in these circumstances, the previous disputes between Karen and Robert including the SDA Application and the Arbitration Award, do not create an adversarial relationship for the entirety of the relevant period.

[27] Robert also submits that he and Michael were adverse in interest because the correspondence from Karen and her counsel was aggressive. Even if I were to accept Robert’s characterization of the correspondence as aggressive, it is insufficient in light of the circumstances described above. To the extent to which the correspondence may have adopted a more contentious tone at certain times, Robert’s numerous extended delays in responding was a significant contributing factor.

[28] However, I am prepared to accept that Karen and Robert were adverse in interest at certain limited times. This includes when Karen or her counsel raised issues with respect to the SDA Application and the Arbitration Award. These are separate and distinct matters not related to Robert’s administration of the Trust. This is sufficient to establish that Karen and Robert were adverse in interest at these specific times and with respect to these distinct issues which I have considered below in my inspection of the Disputed Documents.

Litigation Privilege

[29] G.P. DiTomaso J. set out the test for litigation privilege in *Sky Solar (Canada) Ltd. v. Economical Mutual Insurance Co.*, 2015 ONSC 4714 at para. 80:

“ As for litigation privilege, once again, the onus rests on the party seeking litigation privilege. That party is required to establish two elements: (a) that litigation was contemplated; and (b) that the documents for which privilege is sought were created for the dominant purpose of litigation. This is a conjunctive test. As such, courts have refused to accept the claim of litigation privilege over the documents prepared after the time of litigation was contemplated, where there was no evidence that the subject documents were prepared for the dominant purpose of litigation .”

[30] More recently, the Supreme Court provided the following guidance in *Lizotte v. Aviva Insurance Company of Canada*, 2016 SCC 52 at para. 53:

“In my opinion, litigation privilege is a class privilege. Once the conditions for its application are met, that is, once there is a document created for "the dominant purpose of litigation" (Blank, at para. 59) and the litigation in question or related litigation is pending "or may reasonably be apprehended" (para. 38), there is a " prima facie presumption of inadmissibility" in the sense intended by Lamer C.J. in *R. v. Gruenke*, [1991] 3 S.C.R. 263:

The parties have tended to distinguish between two categories: a "blanket", prima facie, common law, or "class" privilege on the one hand, and a "case-by-case" privilege on the other. The first four terms are used to refer to a privilege which was recognized at common law and one for which there is a prima facie presumption of inadmissibility (once it has been established that the relationship fits within the class) unless the party urging admission can show why the communications should not be privileged (i.e., why they should be admitted into evidence as an exception to the general rule). [Emphasis deleted; p. 286]”

[31] Previously, in *Blank v. Canada (Minister of Justice)*, 2006 SCC 39, the Supreme Court held that litigation privilege is a fundamental principle of the administration of justice which serves an overriding public interest to ensure the efficacy of the adversarial process by protecting communications and documents created for the dominant purpose of use in, or advice concerning, actual, anticipated or contemplated litigation (*Blank* at paras. 4 and 27-28; *Barclays Bank PLC v. Devonshire Trust (Trustee of)*, 2010 ONSC 5519 at para. 8). To achieve this purpose, parties to litigation must be left to prepare their contending positions in private without adversarial interference or fear of premature disclosure by creating a “zone of privacy”, a protected area to facilitate investigation and preparation of their case for trial (*Blank* at paras. 27-28, 34 and 40; Barclays at para. 8). Litigation privilege is a limited exception to the principle of full disclosure which is narrower than solicitor-client privilege, the boundaries of which are limited to the purpose for which the exception is granted (*Blank* at paras. 40, 60-61).

[32] It is not necessary for the party asserting litigation privilege to establish that documents or communications were created for the sole purpose of pending or apprehended litigation. In *Mamaca (Litigation Guardian of) v. Coseco Insurance Co.*, [2007] O.J. No. 4899, J. MacDonald J. held as follows at para. 6:

“ If an investigation and the reports about it have a dual purpose, one of which is to assist in anticipated litigation, the duality of purpose does not mean that litigation privilege cannot exist. A document may be prepared for a multitude of purposes and, if the dominant purpose is to assist in anticipated litigation, then litigation privilege applies to the document: Waugh v. British Railways Board [1979] 2 AII E.R. 1169 (H.L.) at pp. 1173-74. ”

[33] Robert again bears the onus of establishing an evidentiary basis for his claims of litigation privilege on a balance of probabilities (Sky Solar at para. 73). Blanket claims and bald assertions of litigation privilege or merely asserting that the privilege attaches are insufficient (SkySolar at paras. 73-75). This evidentiary burden was explained by Master Dash in *Mamaca (Litigation Guardian of) v. Coseco Insurance Co.*, [2007] O.J. No. 1190 at paragraph 15, reversed on other grounds, *Mamaca (Litigation Guardian of) v. Coseco Insurance Co.*, [2007] O.J. No. 4899; leave to appeal to Div. Ct. denied, [2008] O.J. 2508 (Div. Ct.):

“ The onus is on the party claiming litigation privilege to lay an evidentiary foundation for that privilege. The best evidence would be an affidavit from the claims handler as to when she reasonably anticipated that litigation was likely and why and that her ongoing investigation and document creation was to assist in the defence of that litigation. It would however not be sufficient evidence for the adjuster to make general assertions that all documents created after litigation was reasonably anticipated were prepared for purposes of that litigation. The evidence must be specific and speak to the content of each document. The court could also look to the circumstances and the chronology of events to help in determining the dominant purpose for creation of the documents. It may also "inspect the document for the purpose of determining ... the validity of a claim of privilege" pursuant to Rule 30.06(d) of the *Rules of Civil Procedure*.”

[34] For the reasons that follow, I conclude that litigation privilege does not attach to any of the Disputed Documents.

[35] The parties’ submissions with respect to when actual or potential litigation could have been reasonably contemplated are similar to their arguments above regarding whether there was an adversarial relationship. Robert argues that due to the SDA Application, the Arbitration Award and the history of disputes with Karen, he reasonably contemplated litigation throughout the entire period when the Disputed Documents were created. This includes Karen’s proposal that he be removed as Trustee in the context of resolving issues with respect to the SDA Application and the Arbitration Award. In my view, this is insufficient to establish a reasonable contemplation of litigation during the period in question.

[36] Litigation privilege may continue in a separate proceeding that involves the same or related parties and arises from the same or related cause of action and shares its essential purpose (*Blank* at para. 39). However, just because Karen proposed Robert’s removal as Trustee when settling the SDA Application and the Arbitration Award does not establish that it was reasonable for Robert to contemplate litigation when the Disputed Documents were created. Karen proposed Robert’s removal in the context of settling the previous proceedings, however, there is no mention of his removal after correspondence regarding the administration of the Trust began. Further, the disputed issues in the SDA Application and the Arbitration Award involve separate and distinct issues related to support for Karen and Michael while this Application is limited to issues related to the Trust, a specific instrument established for Michael’s benefit. As I concluded above, I accept that certain separate specific issues, including Robert’s removal as Trustee, were raised in the process of resolving the previous litigation. However, a review of the correspondence does not support Robert’s contention that it was reasonable to contemplate litigation at any point during the creation of the Disputed Documents. Any effect of these specific issues is more appropriately considered in the context of whether the parties were adverse in interest for the purposes of solicitor-client privilege.

[37] Having considered all of the relevant factors and circumstances, I conclude that litigation could not have been reasonably contemplated until July 4, 2018 when Ms. Sweetlove wrote Mr. Housen and advised that she would refer the matter to her litigation group if Mr. Housen did not respond by July 13, 2018. This is the first time that litigation was raised regarding the Trust. Given my conclusions regarding the second part of the test, dominant purpose, my conclusions on the contemplation of litigation are moot in any event.

[38] Even if I held that it was reasonable for Robert to contemplate litigation at any time, I cannot conclude that he has established on a balance of probabilities that any of the Disputed Documents were created for the dominant purpose of litigation. I arrive at this conclusion based on my inspection of the Disputed Documents below and my consideration of the circumstances surrounding their creation. As set out below, substantially all of the Disputed Documents relate to the administration of the Trust. Even if it could be said that litigation was one purpose for creating any of the Disputed Documents, it was not the dominant one. At best, there was a dual purpose or multiple purposes. This is consistent with Robert’s evidence that the purpose of retaining Mr. Housen was to both assist with the administration of the Trust and for his own protection.

Inspection of the Disputed Documents

[39] It is appropriate in the circumstances and consistent with Rule 30.06(d) of the *Rules of Civil Procedure* and the relevant case law for me to inspect the Disputed Documents in order to determine if solicitor-client and/or litigation privilege attaches (*Guelph (City) v. Super Blue Box Recycling Corp.*, [2004] O.J. No. 4468; *University of Guelph Central Student Assn. v. University of Guelph*, 2016 ONSC 3189; *Whitty v. Wells*, 2016 ONSC 7716; *Atomic Energy of Canada Ltd. v. Allianz Global Risks US Insurance Co.*, [2019] O.J. No. 453). The parties do not oppose my inspection.

[40] Disputed Document 2 - This is an email thread dated October 24-27, 2016 between Robert and Mr. Veugelers, his litigation counsel in the SDA Application over which Robert asserts solicitor-client privilege only. This correspondence was created in the context of resolving outstanding issues regarding the SDA Application and the Arbitration Award and within one month after Mr. Housen first contacted Karen regarding the Estate. Substantially all of this document is unrelated to the administration of the Trust and it is apparent that outstanding issues regarding the SDA Application and the Arbitration Award were not completely resolved at this time. Therefore, I conclude that since this document relates to separate and distinct matters in which Robert and Karen were adverse in interest at the time, and they do not relate to Michael’s breach of trust claims, solicitor-client privilege applies. As such, Michael, as a beneficiary, is not entitled to receive this document and Robert is not required to produce it.

[41] Robert claims both solicitor-client privilege and litigation privilege over the remaining 64 Disputed Documents.

[42] Disputed Documents 3, 6, 7, 8, 9, 10, 11, 13, 14, 15, 16, 17, 18, 19, 21, 23, 26, 27, 28, 29, 31, 32, 33, 34, 35, 36, 37, 39, 40, 41, 42, 44, 49, 50, 53, 54 – These 36 Disputed Documents are email messages dated August 2, 2017-March 29, 2018 between Robert and Mr. Housen. This correspondence relates to issues regarding the administration of the Trust, including the set-up of the Trust, the tax filing and requests for documentation and information. As the Disputed Documents relate to the administration of the Trust and there is no evidence that the parties were adverse in interest on these issues at the time they were created, solicitor-client privilege does not apply as against Michael. Further, as set out above, litigation privilege does not apply. Robert shall produce these documents.

[43] Disputed Documents 55, 56 - These are 2 email messages between Robert and Mr. Housen dated April 4, 2018 with respect to an email message from Karen to Mr. Housen dated March 29, 2018. Similar to the group of 36 Disputed Documents above, these emails relate to the administration of the Trust including the tax return and requests for information and other issues. However, there is some content in the emails which is related to remaining issues from the SDA Application and the Arbitration Award unrelated to the Trust in which the parties are adverse in interest. Solicitor-client privilege applies to this specific content as Michael’s entitlement as a beneficiary is limited to documents related to the administration of the Trust where the parties are not adverse in interest. Robert shall produce these documents but redact any information or content unrelated to the Trust. The redaction of portions of documents is an appropriate, accepted practice for protecting privileged and confidential information (*Guelph (City)* at para. 119).

[44] Disputed Documents 60, 61, 62, 63, 64, 65, 69, 72, 75, 77, 78, 79, 80, 81 - These are 14 email messages between Robert and Mr. Housen dated April 13, 2018 to May 14, 2018. The emails relate to requests for information and reimbursement, investments and other issues regarding the administration of the Trust. Accordingly, Robert cannot assert solicitor-client privilege as against Michael as a beneficiary. For the reasons described above, the parties were not adverse in interest at this time on these issues and litigation privilege does not apply. Robert shall produce these documents.

[45] Disputed Documents 70, 71, 83, 84 – These are 2 cover letters and 2 Statements of Account from Mr. Housen dated April 26, 2018 and May 22, 2018 with respect to legal fees for services rendered in connection with the Trust. The legal services described in the Statements of Account relate to the administration of the Trust, therefore, as Michael is a beneficiary, solicitor-client privilege does not attach and he is entitled to receive these documents. This is consistent with the result in Wells regarding counsel’s accounts. For the same reasons as above, litigation privilege does not apply. Robert shall produce these documents.

[46] Disputed Document 82 – These are Robert’s typewritten meeting notes and Mr. Housen’s handwritten notes dated May 17, 2018. Robert’s typewritten notes appear to be largely comprised of excerpts from emails between Robert and Mr. Housen (similar or identical to Disputed Documents 55-56). Mr. Housen has made notes on this document. As the substance of the typewritten document is similar and in some cases identical to Disputed Documents 55-56, the same considerations apply. Therefore, similar to my conclusions above with respect to Documents 55-56, Robert shall produce these documents with text and notes redacted for any information unrelated to the Trust.

[47] Disputed Documents 85, 86, 87, 88, 89, 90, 91 – These are 7 covering emails dated May 23, 2018 and May 27, 2018, between Robert and Mr. Housen attaching CIBC bank and investment statements and a Consolidated Trust Statement for the period April 1, 2017-April 30, 2018. The attachments have already been produced and most of the emails have no content. Any content in the emails is related to the administration of the Trust and for the same reasons set out above, the parties were not adverse in interest. Therefore, solicitor-client privilege does not apply as against Michael. As above, litigation privilege also does not apply. Robert shall produce these documents.

III. Disposition and Costs

[48] Order to go directing Robert to produce copies of the Disputed Documents identified above, or the portions thereof, within 30 days.

[49] If the parties are unable to agree on the costs of this motion, they may file written costs submissions not to exceed 3 pages (excluding Costs Outlines) on a timetable to be agreed upon by counsel.

Reasons Released: April 15, 2020 Signed: Master M.P. McGraw Master M.P. McGraw