CITATION: McQueen et al. v. Mitchell et al., 2022 ONSC 649

DIVISIONAL COURT FILE NO.: DC-20-535-00

DATE: 20220203

ONTARIO SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

McWatt A.C.J.S.C.J., Backhouse J., M. Smith J.

B E T W E E N:

THOMAS J. MCQUEEN personally and as Estate Trustee for the Estate of Doug Wood, BILL MCQUEEN and BETTY MCQUEEN

Plaintiffs/Appellants

AND

DR. DAVID ARNOLD MITCHELL, DR. STEPHEN CHARLES HUEBEL, DR. BRUCE HOLTON FARRINGTON, DR. JOSEPH ZEV SHAINHOUSE, DR. SANJAY KUMAR DHINGRA, DR. DENISE MARIE VASILIOU, DR. CHRISTOPHER ALEXANDER JYU, DR. MAHAN JAVANMARD, DR. "JOHN DOE", SMITHS MEDICAL CANADA LTD., CALEA LTD., VHA HOME HEALTHCARE, NIKOLAI SELAINGIN, JANE DOE, MARYAM POURTANGESTANI, CENTRAL COMMUNITY CARE ACCESS CENTRE, THE SCARBOROUGH HOSPITAL AND "JOAN DOE"

Defendants/Respondents

AND

ONTARIO TRIAL LAWYERS ASSOCIATION

Intervenor

Barbara MacFarlane and Michael Hodgins for the Appellants

Paul-Eric Veel and Lauren Mills Taylor, for the Respondents

Duncan Embury and Brandyn Di Domenico, for the Intervenor

HEARD in Toronto by videoconference on January 17, 2022

Backhouse J.:

Overview

[1] This appeal arises from the August 17, 2020 decision of Myers J. (the “appeal judge”) on a production motion which overturned in part the decision of Master Sugunasiri (as she then was) (“the Master”) and ordered the Appellants to produce all relevant documents contained in the file of their former lawyers.

[2] In 2007, the plaintiff Doug Wood (“Mr. Wood”) suffered a stroke. On August 7, 2009, Mr. Wood, his brother, Thomas McQueen (“Mr. McQueen”) and Mr. Wood’s parents, Bill McQueen and Betty McQueen, commenced a medical negligence claim against several defendants in relation to the care he received (the “Original Claim”). The Original Claim stated that Mr. Wood had suffered two strokes and, “as a result, is now severely brain damaged and completely dependent on others for care.” The defendant physicians (Respondents on this appeal) were not named as defendants in the Original Claim.

[3] At the time the Original Claim was commenced, the former lawyers represented the Plaintiffs (Appellants in this appeal). No litigation guardian was named in the Original Claim and no Affidavit of Litigation Guardian was filed. No person represented themself as litigation guardian to the defendants or to the public. The original defendants did not move to have a litigation guardian appointed.

[4] The Appellants’ former lawyers were removed from the record in 2011.

[5] In 2012, the court raised a concern that Mr. Wood may be a party under disability and the Public Guardian and Trustee (“PGT”) was subsequently appointed to act as litigation guardian for Mr. Wood on February 13, 2012.

[6] In 2013, the Appellants brought a motion to add the Respondents as defendants in the action, taking the position that until a litigation guardian was appointed in February 2012, the two-year limitation period did not run. Mr. McQueen swore an affidavit in support of the motion in which he indicated that Mr. Wood’s communication deficit had been present since his cerebral stroke; that he, not Mr. Wood, signed the retainer with the former law firm to pursue their legal interests relating to Mr. Wood’s cerebral stroke; and that he had not discussed with counsel or agreed to be a litigation guardian on Mr. Wood’s behalf.

[7] The Respondents consented to the amendment to the Original Claim, without prejudice to their right to later advance a limitation period defence. The Respondents served a Statement of Defence alleging the Appellants’ claim was statute-barred by virtue of the expiry of the limitation period under the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B. In their Reply, the Appellants pleaded that Mr. Wood was incapable of commencing a lawsuit in 2007, remained incapable until his death in 2017, and at no time prior to the appointment of the PGT was he represented by a litigation guardian.

[8] In a production motion, the Respondents sought production of the entire file of Mr. Wood’s former lawyers, asserting that Mr. McQueen’s affidavit amounted to implied waiver of what were otherwise privileged documents. The Master dismissed the Respondents’ motion to obtain the former lawyers’ file, finding that the documents sought were not relevant and that there had not been an implied waiver.

[9] The Respondents appealed and the appeal judge overturned the Master’s decision. The appeal judge found that the Appellants had waived privilege and ordered produced all documents in the former lawyer’s file relevant to Mr. Wood’s capacity and whether Mr. McQueen was acting as a de facto litigation guardian for Mr. Wood, including all documents relevant to Mr. McQueen’s dealings with the lawyers for the full period of the former lawyers’ involvement, from first contact until their removal in 2011.

[10] The Appellants submit that the appeal judge erred in law in finding that the former lawyers’ file was relevant, in finding that there was a waiver of solicitor-client privilege and in ordering production of documents protected by solicitor-client privilege.

[11] The former lawyers’ file is privileged and there was no implied waiver. For the reasons set out below, the appeal is allowed and the Order of the Master reinstated.

Additional Facts

[12] On November 14, 2011, Master Haberman adjourned a status hearing in the underlying action, stating concerns that Mr. Wood “may be a party under disability, the nature of which requires assistance of a LG [litigation guardian].”

[13] By letter dated February 6, 2012, Dr. Alexander Spudas, Mr. Wood’s then-family doctor, advised the Court that Mr. Wood had organic brain damage as a result of his embolic cerebral stroke. Dr. Spudas confirmed that, as a result of his stroke, Mr. Wood was unable to understand and follow court proceedings or communicate with a judge or lawyers and concluded that Mr. Wood was in need of a litigation guardian to take care of his legal interests in the litigation. On February 13, 2012, Master Haberman found that Mr. Wood was a party under disability. Mr. McQueen was asked to act as litigation guardian at that time but declined to do so. Accordingly, in February 2012, the PGT was appointed as Mr. Wood’s litigation guardian.

Solicitor’s Negligence Action Against Former Lawyers

[14] In October 2015, the Appellants commenced a solicitor’s negligence action against their former lawyers alleging they had failed to properly advise them or preserve their legal rights by commencing a medical malpractice action against the Respondents prior to the expiry of the presumed limitation date. The solicitor’s negligence action was brought to protect the limitation period as between solicitor and client in the event the claims in the underlying action against the Respondents are found to be statute-barred. The action is in abeyance pending the results of this litigation.

Respondents’ Motion for Production of Appellants’ Former Lawyers’ File

[15] The Respondents moved for production of the entire file of the Appellants’ former lawyers and to compel the Appellants to answer questions during examination for discovery relating to their communications with their former lawyers.

[16] When Mr. McQueen was examined for discovery in this action in 2015, the Respondents requested production of the former lawyers’ entire file. The Appellants refused to answer questions relating to their communications with their former lawyers and refused to provide the former lawyers’ file, claiming solicitor-client privilege.

The Master’s Decision

[17] In dismissing the Respondents’ motion for production of the entire former lawyers’ file, the Master found that the file was irrelevant to the issues of whether Mr. Wood had capacity and whether Mr. McQueen was effectively a litigation guardian at the relevant time.

[18] The Master concluded that the former lawyers’ file was irrelevant to the issue of Mr. Wood’s capacity because while a lawyer’s opinion can be a factor, it did not warrant disclosure of the entire file. Given the existing medical evidence regarding Mr. Wood’s mental condition and the fact that the burden is on the Plaintiffs to prove Mr. Wood’s incapacity, the Master concluded it was not unfair to protect Mr. McQueen’s privilege over the former lawyers’ file. However, the Master ordered that if there were any capacity assessments of Mr. Wood in the former lawyers’ file prior to issuing the Original Claim, Mr. McQueen must produce them.

[19] The Master concluded the former lawyers’ file was also irrelevant to the issue of whether Mr. McQueen was a de facto litigation guardian for Mr. Wood prior to the PGT’s appointment. The Master held that Azzeh (Litigation Guardian of) v. Legendre, 2017 ONCA 385, 135 O.R. (3d) 721 was determinative. The court in Azzeh held that a person’s “representation” on behalf of an incapable person to his solicitor does not make a person a de facto litigation guardian; it is only when a person represents himself as a litigation guardian to the defendants or others that he can be considered a litigation guardian despite not filing an affidavit. Therefore, even if Mr. McQueen represented himself to the former lawyers as representing Mr. Wood, that did not make him a de facto litigation guardian.

[20] Having concluded that the former lawyers’ file was not relevant to the limitation issue, the Master found that it was not necessary for her to decide whether Mr. McQueen had waived solicitor-client privilege over the file. She nevertheless held that given the existing medical evidence and the Plaintiffs’ burden to prove incapacity, it was not unfair to protect the Appellants’ privilege.

Decision of the Appeal Judge

[21] The Respondents appealed the Master’s decision. In a decision dated August 17, 2020, the appeal judge allowed the appeal in part. The appeal judge held that contents of the former lawyers’ file could be relevant and ordered the Appellants to produce a further and better sworn affidavit of documents listing all relevant documents. The appeal judge found the Appellants had waived privilege and ordered them to produce all documents relevant to Mr. Wood’s capacity as contained in the former lawyers’ file and all documents relevant to Mr. McQueen’s dealings with the former lawyers. The Appellants were ordered to reattend examinations for discovery and answer questions concerning those matters.

1. Documents in the former lawyers’ file may be relevant to Mr. Wood’s capacity

[22] The appeal judge held that the Master, despite recognizing that the former lawyers’ observations and views about Mr. Wood’s capacity were properly factors in the calculus, had erred by then dismissing the request for the entire file without delimiting the relevant portions. There could be other things in the file beyond a formal capacity assessment that may be relevant and not privileged.

[23] The appeal judge found that it was “significant” that the Master did not have the benefit of the decision in Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447, 151 O.R. (3d) 609, in which the Court of Appeal makes clear the relevancy of counsel’s opinion on capacity and reiterates that medical evidence “is not necessarily enough.”

2. Documents in the former lawyers’ file may be relevant to whether Mr. McQueen was Mr. Wood’s litigation guardian

[24] The appeal judge held that the Master erred in finding that the only factor relevant to whether a plaintiff is represented by a litigation guardian is whether Mr. McQueen represented himself to any of the defendants as such. The appeal judge held that the factors for determining whether an individual is a de facto litigation guardian is an open question of law, to be decided by the trial judge on a full evidentiary record. Subject to the issue of privilege, the appeal judge held that “everything probative of how the litigation came to be commenced among Mr. Wood, Mr. McQueen and the Respondents’ former counsel is relevant to the issue for trial and is therefore producible.”

3. The Appellants impliedly waived privilege

[25] The appeal judge held that the Appellants had impliedly waived privilege over all documents relevant to Mr. Wood’s capacity as contained in the former lawyers’ file and all documents relevant to Mr. McQueen’s dealings with the former lawyers. By raising s. 7(1)(a) of the Limitations Act, 2002 and adducing evidence about Mr. Wood’s cognitive and physical condition during otherwise privileged meetings, the Appellants put in issue Mr. Wood’s capacity. The former lawyers took the objectively observable step of commencing litigation in his name, which required them to have believed that Mr. Wood had capacity to instruct them to do so. The lack of evidence of a contemporaneous capacity assessment in the record made the lawyers’ evidence important to explain their actions.

[26] The appeal judge held that the Master erred in law in diminishing the relevance of the former lawyers’ evidence and made a palpable and overriding error in overemphasizing the factor of medical evidence in her assessment of the fairness of an implied waiver, given the “elephant in the room” – that experienced counsel had started a claim in Mr. Wood’s name with no litigation guardian in place. The appeal judge found that the Appellants had cherry-picked privileged information to try and meet their burden, such as Mr. McQueen’s evidence that the former lawyers did not advise him of the rights and duties of a litigation guardian. Having opened the issue, fairness and consistency required that the Appellants produce everything relevant to Mr. Wood’s capacity and Mr. McQueen’s dealings with the former lawyers in the former lawyers’ file for the Respondents to test that evidence and have an adequate opportunity to respond.

Issues

[27] The Appellants raise the following issues on this appeal:

1. Did the appeal judge err by determining that the former lawyers’ documents are relevant to whether Mr. Wood had capacity?

2. Did the appeal judge err by determining that the former lawyers’ documents are relevant to whether Mr. McQueen was a litigation guardian on behalf of Mr. Wood?

3. Did the appeal judge err in determining that there was implied waiver of solicitor-client privileged communications and documents?

Court’s Jurisdiction

[28] This court has jurisdiction over this appeal pursuant to s. 19(1)(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43. This is an appeal from an interlocutory order of a single judge of the Superior Court. Leave to appeal was granted by order of this court dated March 15, 2021.

Standard of Review

[29] This is a judicial appeal and appellate standards of review apply, as set out in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235. Questions of law are reviewable on a correctness standard. Questions of fact and questions of mixed fact and law from which the legal principle is not readily extricable are reviewable on a standard of palpable and overriding error: Housen, at paras. 8, 10, 36.

Analysis

Issue #1: Did the appeal judge err by determining that the former lawyers’ documents are relevant to whether Mr. Wood had capacity?

[30] A document is relevant if it makes a fact more or less likely to be true. Both the Master and the appeal judge recognized that while contemporaneous medical evidence is the principal means of proof of capacity or incapacity, lawyers’ observations and views about capacity may be relevant.

[31] The Appellant has not persuaded me that the appeal judge erred in finding that the lawyers’ opinions of Mr. Wood’s capacity are relevant to whether Mr. Wood had capacity at the relevant time.

Issue #2: Did the appeal judge err by determining that the former lawyers’ documents are relevant to whether Mr. McQueen was a litigation guardian on behalf of Mr. Wood?

[32] The Appellants submit that the Master was correct in relying on the Court of Appeal decision in Azzeh to conclude that the former lawyers’ file is not relevant to the litigation guardian issue because a de facto litigation guardian cannot be established where a person has not held oneself out as a litigation guardian to the public.

[33] The Respondents argue that the appeal judge correctly found that the former lawyers’ file is relevant to whether Mr. Wood was represented by a de facto litigation guardian. No case, including Azzeh, has decided that holding oneself out as a litigation guardian is the only factor or a necessary factor in determining whether a litigant is represented by a litigation guardian for the purposes of s. 7 of the Limitations Act, 2002.

[34] The Respondents argue that Mr. McQueen may have failed to name himself litigation guardian thereby making the action irregular by a unilateral act that has the potential to extend the limitation period for an unlimited period of time. The Respondents submit that Azzeh does not address what happens when an individual has not expressly represented himself to be a litigation guardian for an incapable person but nonetheless acts and causes a statement of claim to be issued on that person’s behalf. They submit that the appeal judge correctly held that the circumstances of when an individual will become a de facto litigation guardian is an open question for the trial judge, to be decided on a full evidentiary record.

[35] The Intervenor, the Ontario Trial Lawyers Association, submits that as a matter of law and policy, the concept of a “de facto” litigation guardian does not and cannot exist in any circumstances. A conclusion that a de facto litigation guardian may exist disregards the intention of the legislature and the unambiguous language of r. 7.02(2) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

[36] Subsections 7(1) and (2) of the Limitations Act, 2002 provide as follows:

7 (1) The limitation period established by section 4 does not run during any time in which the person with the claim,

(a) is incapable of commencing a proceeding in respect of the claim because of his or her physical, mental or psychological condition; and

(b) is not represented by a litigation guardian in relation to the claim.

(2) A person shall be presumed to have been capable of commencing a proceeding in respect of a claim at all times unless the contrary is proved.

[37] In order to act as litigation guardian in litigation, one must meet the requirements as set out in r. 7.02 of the Rules of Civil Procedure:

7.02 (1) Any person who is not under disability may act, without being appointed by the court, as litigation guardian for a plaintiff or applicant who is under disability, subject to subrule (1.1). O. Reg. 69/95, s. 3 (1).

Mentally Incapable Person or Absentee

(1.1) Unless the court orders otherwise, where a plaintiff or applicant,

(a) is mentally incapable and has a guardian with authority to act as litigation guardian in the proceeding, the guardian shall act as litigation guardian;

(b) is mentally incapable and does not have a guardian with authority to act as litigation guardian in the proceeding, but has an attorney under a power of attorney with that authority, the attorney shall act as litigation guardian;

(c) is an absentee and a committee of his or her estate has been appointed under the Absentees Act, the committee shall act as litigation guardian;

(d) is a person in respect of whom an order was made under subsection 72 (1) or (2) of the Mental Health Act as it read before April 3, 1995, the Public Guardian and Trustee shall act as litigation guardian.

Affidavit to be Filed

(2) No person except the Children’s Lawyer or the Public Guardian and Trustee shall act as litigation guardian for a plaintiff or applicant who is under disability until the person has filed an affidavit in which the person,

(a) consents to act as litigation guardian in the proceeding;

(b) confirms that he or she has given written authority to a named lawyer to act in the proceeding;

(c) provides evidence concerning the nature and extent of the disability;

(d) in the case of a minor, states the minor’s birth date;

(e) states whether he or she and the person under disability are ordinarily resident in Ontario;

(f) sets out his or her relationship, if any, to the person under disability;

(g) states that he or she has no interest in the proceeding adverse to that of the person under disability; and

(h) acknowledges that he or she has been informed of his or her liability to pay personally any costs awarded against him or her or against the person under disability.

[38] Azzeh involved the mother of a minor son who had retained and, impliedly, instructed counsel on his behalf. She applied for statutory accident benefits on her son’s behalf as a “Guardian” prior to commencing a civil action. Over two years later, when the tort claim was issued, she was named in the title of proceedings as litigation guardian for her minor child but did not file the required Affidavit of Litigation Guardian. The defendant moved to dismiss the action on the basis of an expired limitation period, arguing that the mother had effectively been acting as litigation guardian before the lawsuit.

[39] The Court of Appeal in Azzeh rejected the argument that the mother became her son’s de facto litigation guardian for the purposes of s. 7(1(b) of the Limitations Act, 2002 as soon as she signed a retainer agreement with counsel on her son’s behalf or when she applied for statutory accident benefits for him. The Court of Appeal looked to the statute and stated that the question under s. 7(1)(b) is whether the incapacitated plaintiff was “represented by a litigation guardian in relation to the claim.” The court held that when the mother retained the lawyer, she did so for herself as a future litigation guardian. However, before the claim was commenced, the son was not yet “represented by a litigation guardian in relation to the claim.” Similarly, the mother’s application for statutory accident benefits also did not make her a litigation guardian, as she signed it as a “guardian” rather than a “litigation guardian” and could have been using that term colloquially. The Court held that when the mother commenced the claim naming herself as litigation guardian, she clearly held herself out or represented herself as her son’s litigation guardian to the defendants. Not filing the affidavit a litigation guardian is required to file under r. 7.02(2) made the proceeding an irregularity and not a nullity.

[40] It is clear from this case that the representation made by the litigation guardian must be made to the defendants specifically in relation to the claim itself and not mere instructions to a lawyer.

[41] In another case considered by the Master, Siddiqui v. Saint Francis Xavier High School, 2019 ONSC 30, it was argued that a father was acting as de facto litigation guardian four years prior to a claim being issued when he retained and instructed a lawyer to send a notice letter regarding potential litigation. The court found that the father was not actually representing himself as litigation guardian for the litigation until the proceeding was commenced and he was named as litigation guardian in relation to the specific claim. Simply engaging counsel, signing a retainer agreement, and instructing counsel was insufficient to establish the existence of a de facto litigation guardian and end the tolling of the limitation period. It was noted in Siddiqui that the language of s. 7(1)(b) of the Limitations Act, 2002 requires that the person under disability be represented by a litigation guardian in relation to the litigation itself, not merely by delivering a notice letter (with which no additional responsibilities are associated). Beaudoin J. held that it takes “clear and unequivocal” wording to strip protections away from minors and persons under disability who are incapable of protecting their own legal interests: Siddiqui, at paras. 39-40, citing Murphy v. Welsh, 1993 59 (SCC), [1993] 2 S.C.R. 1069, at para. 12.

[42] The Master considered several additional factors in concluding that the former lawyers’ file was irrelevant to the litigation guardian issue, including that Mr. McQueen did not declare himself as a litigation guardian in the proceeding, did not consent to act as a litigation guardian, was not named in the title of proceedings when the action was commenced, did not file an Affidavit of Litigation Guardian, and did not agree to be appointed later on in 2012.

[43] The appeal judge found at para 47:

Subject to the issue of privilege, it seems to me that everything probative of how the litigation came to be commenced among Mr. Wood, Mr. McQueen, and the plaintiffs’ initial counsel is relevant to the issue for trial and is therefore producible. This includes whether Mr. Wood might have had capacity or been believed to have had capacity, as dealt with above, or whether someone was instructing counsel on his behalf so that some time before or at the time that the claim was commenced, Mr. Wood “was represented by a litigation guardian in relation to the claim”. See: Azzeh at paras. 31 and 32.

[44] There is no caselaw which supports the Respondents’ position that the existence of a de facto guardian may be established under s. 7(1)(b) of the Limitations Act, 2002 in circumstances short of representing oneself as litigation guardian in the claim. While the appeal judge is correct that no court appears to have considered the exact circumstance where a claim has been issued on behalf of a person under disability by someone instructing counsel without a litigation guardian being named, this would not meet the “clear and unequivocal” test in Siddiqui required to strip protections away from minors and persons under disability who are incapable of protecting their own legal interests.

[45] The caselaw has established that signing a retainer agreement with counsel on behalf of a person under disability, retaining a lawyer for oneself as a future litigation guardian, or instructing counsel are insufficient to establish the existence of a de facto litigation guardian. Despite this, communications and documents dealing with these matters are precisely the types of documents that the appeal judge found relevant and ordered to be produced.

[46] The appeal judge seemed persuaded by the Respondents’ argument that it would be unfair to defendants if claims can be commenced in the name of an incapacitated party without there being a deemed appointment of a litigation guardian, as the limitation period will effectively be extended indefinitely. The appeal judge found that this would “provide a significant loophole to de facto litigation guardians who keep quiet.” He found that other factors in addition to “holding out” may be at play in a case where litigation is commenced with no litigation guardian by a plaintiff who later claims he was incapacitated at the time.

[47] There was no evidence of “keeping quiet” about being litigation guardian or abuse by Mr. McQueen. The Original Claim stated that Mr. Wood had suffered two strokes and, “as a result, is now severely brain damaged and completely dependent on others for care.” The appeal judge’s focus on wider policy issues and whether the law on “de facto” litigation guardians should be extended in other circumstances was the wrong focus. Instead the focus should have been on the requirements for the protection of a disabled party.

[48] As the Intervenor in this case points out, there is a mandatory formal procedure in place in Ontario for the appointment of litigation guardians, governed by r. 7.02(2) of the Rules of Civil Procedure. The requirements of r. 7.02(2) ensure the protection of the disabled party as well as the proposed defendants. Under s. 9 of the Limitations Act, 2002, if the running of a limitation period in relation to a claim is postponed or suspended because a person is incapable and not represented by a litigation guardian, a potential defendant has the opportunity to move to appoint a litigation guardian for a potential plaintiff. While the Respondents point out that this did not avail them as they were ignorant of the claim until the Appellants moved to add them as parties, in many cases, it is the court that initiates the move to appoint a litigation guardian, as was the case here.

[49] On the current state of the law, a family member instructing counsel on behalf of a person under disability does not make that person a litigation guardian for the purposes of the litigation.

[50] In my view, the appeal judge erred in law in finding that the former lawyers’ documents are relevant to whether Mr. McQueen was a de facto litigation guardian on behalf of Mr. Wood.

[51] The appeal judge found that any communications of Mr. McQueen’s status to the other defendants in or around the commencement of the claim in 2009 (prior to the Respondents being added as parties) would be relevant and not privileged. I agree that if there were any such communications, they should be produced.

[52] I now move on to consider whether there was an implied waiver of solicitor-client privileged communications and documents.

Issue #3: Did the appeal judge err in determining that there was implied waiver of solicitor-client privileged communications and documents?

[53] The Master found that having decided that the former lawyers’ file was not relevant to the matters in issue (capacity and de facto litigation guardian), it was not necessary to decide whether Mr. McQueen had waived his solicitor-client privilege over the file. She nevertheless held that even if the Respondents had persuaded her that Mr. McQueen had waived privilege over the entire file by revealing some of his communications with counsel and as a result of the solicitor’s negligence suit against the former lawyers, it was still incumbent on the court to jealously protect solicitor-client privilege unless it is unfair to do so. She found that given the existing medical evidence and the reality of the Appellants’ burden to prove incapacity, it was not unfair to protect Mr. McQueen’s privilege over the former lawyers’ file.

[54] On appeal, the appeal judge found the lawyers’ file was relevant to both what the lawyers thought about the client’s capacity and whether Mr. McQueen was instructing counsel as a potential de facto litigation guardian. He went on to determine that the Appellants had impliedly waived privilege over and were required to produce all documents relevant to Mr. McQueen’s dealings with the former lawyers from the full period of the former lawyers’ involvement, from first contact until their removal in 2011.

[55] The Appellants submit that none of the requirements of implied waiver of privilege are met in this case. The Respondents assert that there was implied waiver by Mr. McQueen in disclosing the following in his affidavit in support of adding the Respondents as defendants in the action: that he, not Mr. Wood, signed the retainer; that Mr. Wood did not pay monies towards the retainer fee; that Mr. Wood was unable to communicate at the relevant time, so Mr. McQueen went on his own or with Mr. Wood to speak with the lawyers; that Mr. McQueen did not receive a copy of the statement of claim nor was he advised of its contents; that no person at the former law firm communicated directly with Mr. Wood; and no person at the former law firm advised Mr. McQueen of the risks of being a litigation guardian nor asked him to act in that capacity.

[56] In Soprema Inc. v. Wolrige Mahon LLP, 2016 BCCA 471, 90 B.C.L.R. (5th) 318, Harris J.A. explained the starting point for understanding the test for implied waiver at para. 50:

The starting point of an articulation of the test for implied waiver must recognize what the Supreme Court of Canada has made clear about the importance of solicitor-client privilege. In R. v. McClure, 2001 SCC 14 (S.C.C.) at para. 35, the Court said that solicitor-client privilege “must be as close to absolute as possible to ensure public confidence and retain relevance. As such, it will only yield in certain clearly defined circumstances, and does not involve a balancing of interests on a case-by-case basis” (emphasis added). Furthermore, the Court said (at para. 17) that solicitor-client privilege “is part of and fundamental to the Canadian legal system. ... [I]t has evolved into a fundamental and substantive rule of law.” This view was affirmed in Goodis v. Ontario (Ministry of Correctional Services), 2006 SCC 31 at paras. 20‑21, where the Supreme Court of Canada made clear that communications protected by privilege should be disclosed only where “absolutely necessary”, applying “as restrictive a test as may be formulated short of an absolute prohibition in every case.” [Underlining in original; italics added.]

[57] Caution must be exercised not “to treat implied waiver as ultimately a discretionary call about trial fairness.” The implication of waiver must be consistent with “the near absolute protection of solicitor-client privilege mandated by the Supreme Court”: H.M.B. Holdings Limited v. Replay Resorts Inc., 2018 BCCA 263, 11 B.C.L.R. (6th) 365, quoting Soprema Inc., at para. 51.

[58] Solicitor-client privilege is a fundamental civil and legal right belonging to the client. Any attempt to interfere with this special privilege should be limited to what is absolutely necessary in order to achieve the ends sought by the interference. This is a foundational principle of law that has been repeatedly endorsed by the Supreme Court of Canada: Solosky v. The Queen, 1979 9 (SCC), [1980] 1 S.C.R. 821, at para 34; Descôteaux et al. v. Mierzwinski, 1982 22 (SCC), [1982] 1 S.C.R. 860, at para 27.

[59] Solicitor-client privilege can be implicitly waived by a client “where the voluntary conduct of that person indicates an implied or objective intention to waive it” (emphasis in original) though it will only yield in the clearest of cases, and does not involve a balancing of interests: Oliva et al. v. Dickson et al., 2019 ONSC 173, at para. 17. Consideration must be given to the “near absolute protection” over the privilege mandated by the Supreme Court of Canada: Oliva, at para. 20.

[60] Courts have held that implied waiver is limited to circumstances where all of the following requirements are met:

(a) The relevance of the privileged evidence is high;

(b) The principles of fairness and consistency require disclosure;

(c) The party’s state of mind is in issue and the party has given evidence that they received legal advice which played a part in forming that state of mind: Roynat Capital Inc. et al. v. Repeatseat Ltd. et al., 2015 ONSC 1108, at paras. 83-84; Creative Career Systems Inc. v. Ontario, 2012 ONSC 649, at para 29.

The overarching test is whether fairness and consistency require disclosure with the other factors being things the court will consider when they are raised on the facts of the case.

Is the relevance of the privileged evidence high?

Capacity

[61] The Ontario Court of Appeal in Carmichael held that the opinion of a party’s counsel may be a relevant factor in determining capacity, as can the party’s ability to instruct counsel “if it bears on the capacity to commence a claim.” Carmichael was a summary judgment motion where there was some evidence adduced about the plaintiff’s ability to instruct counsel in other actions. The appeal judge found “that it was significant that the Master did not have the benefit of the Carmichael decision in which the Court of Appeal makes clear the relevancy of counsel’s opinion and reiterates that medical evidence is not necessarily enough.”

[62] Carmichael did not create new law. The focal issue considered by the court in Carmichael was not what the lawyer thought about capacity. The court was persuaded by the fact that the plaintiff had, inter alia, demonstratively retained and instructed lawyers for multiple pieces of litigation. Jamal J.A. concluded that what a lawyer thinks about a client’s capacity – the lawyer’s opinion – may be relevant. However, this statement was made when discussing cases where the opinion evidence was available to the court. Notably, Jamal J.A. did not require production of the lawyer’s file underlying the lawyer’s opinion nor was this done in any of the cases discussed in Carmichael. Carmichael was not a case about production of or waiver over solicitor-client privilege. The appeal judge erred by interpreting Carmichael as support in this case for finding that the Appellants waived solicitor-client privilege over opinion evidence in the lawyers’ file.

[63] The cases referred to by Jamal J.A. in Carmichael were before the Master on the original motion who correctly concluded that what the former lawyers thought of Mr. Wood’s capacity can be a factor to determine capacity. Given the existing medical evidence regarding Mr. Wood’s mental condition and the fact that the burden is on the Appellants to prove Mr. Wood’s incapacity, the Master concluded it was not unfair to protect Mr. McQueen’s privilege over the former lawyers’ file.

[64] In determining implied waiver, the appeal judge should have considered what contemporaneous medical evidence was available – the principal means of proof of capacity or incapacity – and whether that made the privileged evidence of lower relevance.

[65] In this litigation, the Respondents have received Mr. Wood’s relevant medical records, including the diagnostic imaging report, diagnosis treatment, rehabilitation records, and opinions relating to his devastating cerebral embolic stroke and consequent brain injury, identified on imaging. The records of the treating health care practitioners refer to Mr. Wood’s brain injury, which caused a multitude of physical and cognitive impairments that resulted in aphasia, difficulty with word finding, expressive and written communication deficits, and challenges with insight and judgment that have persisted since his cerebral stroke, as well as at least one hospital admission where he was admitted and deemed incapable.

[66] Apart from noting the absence of a contemporaneous capacity assessment and characterizing a note of Dr. Spudas, Mr. Wood’s family doctor, as “a minimal piece of medical evidence,” the appeal judge did not consider the contemporaneous medical records, reports, and opinions which did exist regarding Mr. Wood’s mental condition. In my view, the relevance of the former lawyers’ opinion on capacity is not of high relevance, given the existing contemporaneous medical evidence.

De Facto Litigation Guardian

[67] Mr. McQueen did not hold himself out as litigation guardian in the Original Claim. The caselaw has established that instructing counsel is insufficient to establish the existence of a de facto litigation guardian and that s. 7(1) of the Limitations Act, 2002 and Rule 7.02(2) of the Rules of Civil Procedure require a representation to the public. The mere potential that relevance may be found if there are other factors not articulated by the court in Azzeh that would lead to the creation of a de facto litigation guardian does not meet the test of relevance necessary to order disclosure of solicitor-client privileged documents. In my view, it was an extricable error of law for the appeal judge to base his decision that solicitor-client privilege had been waived, in part, on his conclusion that the former lawyers’ file was relevant to the litigation guardian issue.

Do the principles of fairness and consistency require disclosure?

[68] The Respondents submit that courts have found that “fairness and consistency” require production of otherwise privileged information including where a party:

(a) has partially disclosed the contents of a protected communication: KF Evans Ltd. v. Canada (Minister of Foreign Affairs), [1996] F.C.J. No. 30, at paras. 10-25; R. v. Basi, 2009 BCSC 777, at paras. 15-28;

(b) impugns legal advice or instructions: AAA U-Store & U-Move Inc. v. United Urban Corp. [2001] O.J. No. 3884 (S.C.J.), at para. 9; Currie v. Symcor Inc., [2007] O.J. No. 3225 (S.C.), at para. 115;

(c) puts at issue its reliance on legal advice (or the lack of legal advice): 0782484 BC Ltd. v. E-Pro Enterprises Inc., 2017 BCSC 2245, at paras. 41-58; Araya v. Nevsun Resources Ltd., 2019 BCCA 205, at paras. 31-38; or

(d) uses privileged documents as a sword: Brown v. Clark Wilson LLP, 2014 BCCA 185, at paras. 26-28.

[69] The Master found that it was not unfair to protect privilege in these circumstances. However, the appeal judge found that the Appellants had adduced cherry-picked snippets of evidence about what Mr. McQueen was or was not told by counsel about being a litigation guardian and the commencement of the proceeding. He held that it would neither be consistent nor fair to refuse to disclose other evidence in the Appellants’ possession, power or control dealing with Mr. McQueen’s dealing with the former lawyers for the purposes of determining whether he was acting as a de facto litigation guardian..

[70] The court is the gatekeeper, protecting litigants from inappropriate requests for disclosure and balancing fairness with the importance of solicitor-client privilege. It is not the law that waiver of privilege over one document or fact to which solicitor-client privilege attaches, impliedly waives privilege over other solicitor-client privileged information or documents. It must be shown that without the additional privileged documents, the information produced is somehow misleading: Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co., 1995 7258 (Ont. S.C.), at para 41.

[71] In considering whether solicitor-client privilege had been waived, the appeal judge should have considered whether Mr. McQueen put his state of mind in issue when he deposed his affidavit and whether he relied on legal advice in forming that state of mind such that he waived privilege over associated documents or communications.

[72] The statements made by Mr. McQueen in his affidavit were factual in nature: that he was not made aware of the requirements of a litigation guardian nor was he asked to be a litigation guardian, and that he was not given a copy of the Statement of Claim. Even if the statements made were to be considered legal advice, he did not state that he relied on this advice or that it informed his state of mind. Mere reference to the circumstances under which a party received legal advice does not justify waiving solicitor-client privilege: Roynat Capital Inc., at para. 32, citing Sidney N. Lederman, Alan W. Bryant & Michelle K. Fuerst, The Law of Evidence, 4th ed. (Markham: LexisNexis Canada, 2014), at 14.147-14.158.

[73] When dealing with a possible implied waiver, the court must take into account the special status afforded to the privilege. Solicitor-client privilege must be as close to absolute as possible to ensure public confidence and retain relevance: Oliva, at para. 18. As such, it will only yield to implied waiver in the clearest of cases. The appeal judge erred in engaging in a balancing of interests of the parties rather than what was required – balancing fairness with the importance of privilege: Roynat Capital Inc., at para. 84. This is not a case where Mr. McQueen impugns legal advice or instructions, puts at issue his reliance on legal advice, or uses privileged documents as a sword – factors the Respondents submit have caused courts to find that fairness and consistency require ordering production of otherwise privileged documents. To order all privileged communications be produced so that Mr. McQueen can prove a negative is disproportionate and contrary to the near-absolute status of solicitor-client privilege. In my view, the Master was correct in her finding that it was not unfair to protect the Appellants’ privilege and the Respondents can adequately defend themselves given the existing medical evidence and the Appellants’ burden to prove incapacity.

Did the appeal judge err in rejecting the Respondents’ argument that the Appellants waived privilege over their former lawyers’ file by commencing a solicitor’s negligence action against the former lawyers?

[74] The Respondents also submit that the Appellants’ solicitor’s negligence action against their former lawyers provides a second independent basis for waiver of privilege. I do not agree. That lawsuit was filed to protect the limitation period against their former lawyers and is in abeyance pending determination in the within action of whether the claims against the Respondents are statute-barred. The appeal judge correctly found that a lawyer is entitled to defend themselves using confidential information but shall not disclose more information than is required. The appeal judge correctly rejected the argument that by suing their former lawyers, the Appellants waived privilege over the entire file.

Conclusion

[75] The appeal judge erred in finding that the requirements of implied waiver of privilege had been met. The former lawyers’ file is privileged and need not be produced (except as specifically delineated above in para.51). The appeal is dismissed and the January 29, 2020, decision of Master Sugunasiri is restored.

[76] Based upon the parties’ agreement, costs are awarded to the Appellants as the successful party, fixed in the amount of $25,000.

Backhouse J.

I agree _______________________________

McWatt A.C.J.S.C.J.

I agree _______________________________

M. Smith J.

Released: February 3, 2022

CITATION: McQueen et al. v. Mitchell et al., 2022 ONSC 649

DIVISIONAL COURT FILE NO.: DC-20-535-00

DATE: 20220203

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

McWatt A.C.J.S.C.J., Backhouse J., M.Smith J.

B E T W E E N:

THOMAS J. MCQUEEN personally and as Estate Trustee for the Estate of Doug Wood, BILL MCQUEEN and BETTY MCQUEEN

Plaintiffs/Appellants

AND

DR. DAVID ARNOLD MITCHELL, DR. STEPHEN CHARLES HUEBEL, DR. BRUCE HOLTON FARRINGTON, DR. JOSEPH ZEV SHAINHOUSE, DR. SANJAY KUMAR DHINGRA, DR. DENISE MARIE VASILIOU, DR. CHRISTOPHER ALEXANDER JYU, DR. MAHAN JAVANMARD, DR. "JOHN DOE", SMITHS MEDICAL CANADA LTD., CALEA LTD., VHA HOME HEALTHCARE, NIKOLAI SELAINGIN, JANE DOE, MARYAM POURTANGESTANI, CENTRAL COMMUNITY CARE ACCESS CENTRE, THE SCARBOROUGH HOSPITAL AND "JOAN DOE"

Defendants/Respondents

AND

Ontario Trial Lawyers Association

Intervenor

REASONS FOR JUDGMENT

Released: February 3, 2022 Backhouse J.