Supreme Court of Canada
United States of America (District Court) v. Royal American Shows, Inc. et al., 1982 CanLII 171 (SCC), [1982] 1 SCR 414
IN THE MATTER of an Application pursuant to Section 43 of the Canada Evidence Act
AND IN THE MATTER of a Request for International Judicial Assistance from the United States District Court, Middle District of Florida, Tampa Division, by way of Letters Rogatory
The District Court of the United States, Middle District of Florida Appellant;
and
Royal American Shows, Inc., Carl J. Sedlmayr, Jr., Vivian Phillips, Esther Phillips, Mark Popovich, Nina Popovich, Frank J. Russell and Peter Andrews Respondents;
AND IN THE MATTER of an Application pursuant to the Canada Evidence Act, R.S.C. 1970, c. E-10, Part II, Section 43;
AND IN THE MATTER of a Request for International Judicial Assistance from the United States District Court, Middle District of Florida, Tampa Division, by way of Letters Rogatory dated February 25, 1981;
The United States of America Applicant;
and
Royal American Shows, Inc., Carl J. Sedlmayr, Jr., Vivian Phillips, Esther Phillips, Mark Popovich, Nina Popovich, Frank J. Russell and Peter Andrews Respondents.
1982: January 27; 1982: March 18.
Present: Laskin C.J. and Ritchie, Dickson, Estey and McIntyre JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR ALBERTA
Evidence—Letters rogatory—U.S. tax case—Production of documentary evidence in Canada—Documentary evidence not ancillary to viva voce tes-
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timony—Whether or not documentary evidence alone subject to s. 43 of the Canada Evidence Act—Admissibility of illegally obtained telephone taps in s. 43 hearing—Canada Evidence Act, R.S.C. 1970, c. E-10, ss. 43, 47—Criminal Code, R.S.C. 1970, c. C-34, ss. 178.2, 178.16, 446.
The Alberta Supreme Court responded favourably to letters rogatory seeking assistance for the production of documents and recordings of telephone interceptions for use in a U.S. trial dealing with criminal tax evasion. The persons holding the subject material were directed to appear before a Commissioner. Both the hearing under s. 43 of the Canada Evidence Act and the production of the materials before the Commissioner were to be deferred until the conclusion of a series of proceedings and appeals relating to material seized by the Minister of National Revenue. The Alberta Court of Appeal found s. 43 of the Canada Evidence Act inapplicable. Appellant appealed that judgment and, as applicant, addressed fresh letters rogatory to this Court in its capacity of court of original jurisdiction in this regard. However, in the result it became unnecessary to consider this original application to the Supreme Court.
Held: The appeal should be allowed.
Section 43 of the Canada Evidence Act should be given a broad, liberal construction in the interests of comity. That section, providing concurrently or separately for viva voce testimony and for testimony by way of documentary evidence, is wide enough to support this request for documents alone. Judicially established guidelines prescribing the limits of comity were met—excluding the tapes of illegally intercepted telephone calls. The evidence was required for trial, not discovery; relevancy was a matter for the commissioner taking the evidence and/or for the U.S. court to determine; the scope of the inquiry was within Alberta law; and, the material requested was adequately defined. The contents of illegally tapped telephone calls were admissible at the s. 43 hearing only as against the other accused in order not to prejudice the illegally tapped couple as defendants in the U.S. proceedings. Section 178.16(3.1) of the Criminal Code enlarging the admissibility of intercepted private communications was not eroded in these circumstances.
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Judicial assistance, despite arguments opposing it, should be granted. The Alberta Court had jurisdiction; its rules provided for the extra-territorial application of its orders and the federal department holding evidence in Regina had assured co-operation. As only criminal charges were involved in the application, there could be no question of collecting a foreign country’s taxes. Arguments based on s. 446 of the Criminal Code, dealing with the retention and disposition of seized material, were eclipsed by procedural developments in this case.
Zingre v. The Queen, 1981 CanLII 32 (SCC), [1981] 2 S.C.R. 392 applied; Penn-Texas Corporation v. Murat Anstalt and Others (No. 2), [1964] 2 All E.R. 594; Medical Ancillary Services et al. v. Sperry Rand Corporation (1979), 1979 CanLII 1639 (ON SC), 23 O.R. (2d) 406; Burchard v. Macfarlane, [1891] 2 Q.B. 241; Radio Corporation of America v. Rauland Corporation, [1956] 1 All E.R. 549, reversing [1956] 1 All E.R. 260; Penn-Texas Corporation v. Anstalt and Others (No. 1), [1963] 1 All E.R. 258; Panthalu v. Ramnord Research Laboratories, Ltd., [1965] 2 All E.R. 921; American Express Warehousing, Ltd. v. Doe and Others, [1967] 1 Lloyd’s Rep. 222, considered.
APPEAL from a judgment of the Alberta Court of Appeal, (1981), 1981 ABCA 23, 26 A.R. 136, setting aside an order of Miller J. who responded favourably to letters rogatory issued by Magistrate Game of the United States District Court, Middle District of Florida, Tampa Division. Appeal allowed.
B.A. Crane, Q.C., and Henry S. Brown, for the appellant.
A.G. Macdonald, Q.C., for the respondents.
The judgment of the Court was delivered by
THE CHIEF JUSTICE—This is an appeal, by leave, from a judgment of the Alberta Court of Appeal setting aside an order of Miller J. who responded favourably to letters rogatory issued by Magistrate Game of the United States District Court, Middle District of Florida, Tampa Division. In brief, the letters rogatory sought the assistance of Canadian courts, pursuant to s. 43 of the Canada Evidence Act, R.S.C. 1970, c. E-10, to secure the production of certain documents and recordings of telephone interceptions, either in original form or by way of certified copies, for use
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in a trial in the requesting court of charges of criminal evasion of income tax by a number of American citizens then within the jurisdiction of that court.
Miller J., in lengthy reasons delivered on September 13, 1979 and to which I will refer in due course, made an order for production of certified copies by the persons having physical control of the material who were, under his formal order of November 28, 1979, directed to appear before former Justice Neil Primrose, appointed as a Commissioner, for examination pursuant to s. 44 of the Canada Evidence Act. The lapse of time between the delivery of the reasons and the issue of the formal order occurred because of the acceptance by the United States Court of Miller J.’s invitation to add additional exhibits to the letters rogatory. In the result, additional letters rogatory were issued which had as exhibits detailed schedules listing other documents whose production was requested. The list, I should note, contained documents requested by the defendants.
Although the formal order included documents in the supplementary request for judicial assistance, the documents principally in issue were those identified as contained in Exhibits 1(a), 1(b), 1(c), 1(d) and Exhibit 2. These were documents which were seized by the police in carrying out an investigation into the affairs of the Royal American Shows, Inc. operators of a midway and carnival in Western Canada and in the United States. The individual respondents against whom criminal proceedings were on foot in Florida, were all associated with the operations of the Royal American Shows, Inc.
Some of the documents seized by the police were in turn taken from them by members of the Department of National Revenue under the Income Tax Act and brought to its offices in Regina. Some of these were returned to Edmonton for use in connection with conspiracy charges in Alberta which the provincial Attorney General
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brought. Before going on with them, however, he established a public inquiry under Justice Laycraft and many documents among those originally seized were entered as exhibits in that inquiry. Tape recordings of certain intercepted conversations were also produced in the Laycraft inquiry. As a result of the inquiry, the conspiracy charges were stayed. The stay was followed by an application before Provincial Court Judge Rolf to determine who was entitled to the seized material. Judge Rolf held that the Minister of National Revenue could not lawfully retain the material it had taken by what was an illegal seizure and ordered its return to Royal American Shows, Inc. and to certain concessionaires. An appeal taken from this ruling was pending when Miller J. handed down his reasons.
In the meantime, a consent order was made that all persons having custody of any seized material would keep it safe pending the appeal. The record showed that some of the material was in the hands of the Edmonton City Police, some in the hands of the Department of National Revenue in Regina, some in the possession of the Alberta Court of Queen’s Bench and some (the Laycraft inquiry exhibits) in the possession of the clerk of the Alberta Legislature.
In his reasons, and again in his formal order, Miller J. directed that the hearing under s. 43 of the Canada Evidence Act be deferred until judicial proceedings and appeals relating to the seized material were concluded and that production of the original materials before the Commissioner be likewise deferred until that time.
The Judgment of the Alberta Court of Appeal
The Alberta Court of Appeal, speaking through Lieberman J.A., took only one point in setting aside the order of Miller J. It held that a request by the United States District Court for the production of documents only did not come within s. 43 of the Canada Evidence Act. Unless the request for judicial assistance related to the examination of a witness or party, who might then be ordered
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to produce documents, a request merely for production of documents could not be the subject of an order under s. 43.
I do not agree with this view of s. 43 for reasons to which I will come. Following the judgment of the Court of Appeal, fresh letters rogatory were addressed to the original jurisdiction of this Court (the only original jurisdiction remaining to us, apart from references by the Governor in Council) in which examination of witnesses was sought and as well the production of documents. Counsel for the applicant, being also the appellant here in respect of proceedings in the Alberta courts, indicated that if he succeeded in the appeal he would not pursue the original application here. Of course, this Court heard argument from both sides on the original application but since, in my opinion, the appeal should succeed, I would either give leave to withdraw the application without costs or I would quash it without costs.
An Order for Production of Documents under Section 43
Letters rogatory engage s. 43 of the Canada Evidence Act which reads as follows:
- Where, upon an application for that purpose, it is made to appear to any court or judge, that any court or tribunal of competent jurisdiction, in the Commonwealth and Dependent Territories, or in any foreign country, before which any civil, commercial or criminal matter is pending, is desirous of obtaining the testimony in relation to such matter, of a party or witness within the jurisdiction of such first mentioned court, or of the court to which such judge belongs, or of such judge, the court or judge may, in its or his discretion, order the examination upon oath upon interrogatories, or otherwise, before any person or persons named in the order, of such party or witness accordingly, and by the same or any subsequent order may command the attendance of such party or witness for the purpose of being examined, and for the production of any writings or other documents mentioned in the order, and of any other writings or documents relating to the matter in question that are in the possession or power of such party or witness.
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The reasons of the Alberta Court of Appeal are founded upon an analysis of s. 43 which sees it composed of two limbs, the second dependent upon an order made under the first; or, to put the issue in other words, production must be ancillary to an order for examination of a witness or party to elicit oral evidence. Lieberman J.A. expressed himself as follows:
In my respectful view it is only necessary to deal with one question in this appeal. Can this Court acting pursuant to s. 43, supra, grant the request of the Florida Court which is a request for documents only?
An analysis of s. 43 discloses that it is composed of two limbs. Under the first limb the Court may make an order for the examination of a witness or party and under the second limb the Court may then by that order or by a subsequent order command the attendance of a party or witness for the purpose of being examined or for the production of documents. Clearly, the implementation of the second limb is dependent upon an order made under the first limb.
While I agree that the word testimony in s. 43 includes both oral evidence and documentary evidence (Radio Corporation of America v. Rauland and Another [1951] 1 Q.B. 618 and Re Radio Corporation of America v. Rauland et al. (1956), 1956 CanLII 152 (ON SC), 5 D.L.R. (2d) 424), I am of the opinion that this does not affect the application of what I would term the two-limbed approach.
Once it is conceded, as the learned Justice of Appeal says, that the word “testimony” in s. 43 includes both oral evidence and documentary evidence, I do not see any compelling reasons for a two-limbed approach, an approach which he comes to through the use of the word “then” in the passage of his reasons above-quoted and which obviously relies upon the word “such” in s. 43. I read s. 43 differently and more broadly as providing concurrently or separately for viva voce testimony and for testimony by way of documentary evidence. The word “such” is merely a referent and not a restriction, once it is conceded that “testimony” includes both oral and documentary evidence. The section speaks of ordering examination upon oath upon interrogatories or otherwise “and by the same or any subsequent order may command the attendance of such party or witness for the purpose of being examined, and for the production of any writings or other documents”.
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(The underlining of the word “same” is mine.) As this Court has indicated in Zingre v. The Queen, 1981 CanLII 32 (SCC), [1981] 2 S.C.R. 392, comity dictates that a liberal approach should be taken to requests for judicial assistance, so long at least as there is more than ephemeral anchorage in our legislation to support them. I am of the view that s. 43 is wide enough to support the request here for production of documents alone.
I say this because documents for use in criminal proceedings are not expected to walk into Court unescorted. Lord Denning in Penn-Texas Corporation v. Murat Anstalt and Others (No. 2), [1964] 2 All E.R. 594, noted quite correctly, at p. 598, that when a subpoena duces tecum is issued to an individual, he was originally sworn even though only called to produce documents. Later, to overcome subjecting him to cross-examination on the case at large when his only role was the formal one of producing the documents and saying that he had custody of them and how he came by them, a witness called only to produce documents did not have to be sworn and could not be cross-examined at large but he could be sworn if any issue arose as to his custody and for that limited purpose only.
I am not concerned here with the procedural question whether the person called only to produce documents need be sworn. (In Canada, the rule is that he is sworn.) The Alberta Court of Appeal said that Lord Denning’s observations on the subpoena duces tecum favoured the right to issue letters rogatory calling only for the production of documents, but then said that he qualified his views by certain concluding words, as follows:
…provided always that the documents are required for the purposes of the trial, as ancillary to the examination of a witness,…
The Court of Appeal ended this quotation too soon because it continues with these added words:
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and not as a means of getting discovery from a person not a party … nor as part of a pre-trial procedure which is not a part of the trial…
In the present case, there is no question of the documents being sought for discovery or for any purpose other than trial. I would adopt what Lord Denning said as unqualified by any ancillary doctrine. Indeed, in my view the Alberta Court of Appeal has taken the English cases, especially the two Penn-Texas cases too far. They do not, as I read them, support the Court of Appeal’s position. On the other hand, its position is supported by the judgment of Steele J. in Medical Ancillary Services et al. v. Sperry Rand Corporation (1979), 1979 CanLII 1639 (ON SC), 23 O.R. (2d) 406, and I shall have something to say about this case (which was cited and quoted without particular emphasis) after I have looked at the English cases considered by the Alberta Court of Appeal.
Review of the Authorities
Although Burchard v. Macfarlane, [1891] 2 Q.B. 241, was not itself cited in the courts below, it was referred to with approval in Radio Corporation of America v. Rauland Corporation, [1956] 1 All E.R. 260, and on appeal at p. 549, which was considered in the Alberta courts. I propose to examine it first because it appears to have promoted the ancillary doctrine applied by Lieberman J.A. in the present case. The Burchard case was not a case involving letters rogatory but it was close enough in involving an attempt to obtain commission evidence in England for use in a Scottish action by the production of documents from a non-party witness under s. 5 of the British Evidence by Commission Act of 1843. The English Court of Appeal held that the order that was made was in effect an order for discovery, and there was no right to such an order against a non-party witness. Lord Halsbury put the matter in these words (at p. 245): “When I look at the Act of Parliament, it appears to me that the only process intended to be enforced was the production of documents as ancillary to the examination of a witness”. Lord Esher pointed out that the order was made on third parties who have nothing to do
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with the action, and with respect to documents which are their sole property and not in any way the property of the parties to the action. The order was, in effect, for discovery which was beyond the Court’s jurisdiction. He added this (at pp. 248-49):
Where there is an order that a witness is to be examined before the commissioner, it is under the same circumstances as would arise if he were examined at the trial, and the order that may be lawfully made is for the attendance for examination as a witness as if he were at the trial—the production of any writings or documents to be mentioned in the rule or order which may be made for his attendance and examination as a witness, is only equivalent to saying that he must bring the writings or documents as he would bring them [with him] on a subpoena duces tecum. Here that is evaded. The order is for discovery before examination instead of for production on examination.
Fry L.J. gave reasons to the same effect. I quote the following from his reasons (at p. 250):
That statute enables the Court in England or Scotland or Ireland to direct a commission for the examination of witnesses—that means persons who are able to bear testimony with regard to the issues in controversy between the litigant parties. It does not mean that they may be examined with regard to the possession of documents which may be relevant to the controversy between the parties. That observation governs, in my opinion, the whole of the section, and I think the words at the end “for the production of any writings or documents to be mentioned in such rule or order,” are only ancillary to the examination of witnesses. The words may enable the parties to require the production of the documents which the witness produces as a witness; but they cannot for one moment be stretched so as to enable any one to obtain discovery against a witness.
Radio Corporation of America v. Rauland Corporation, supra, involved letters rogatory addressed to judicial authorities in England for assistance in a United States action by way of requiring certain persons who were directors of two English companies to attend for examination, under s. 1 of the English Foreign Tribunals Evidence Act, 1856, and to produce certain documents of the companies although neither they nor the
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directors were parties to the United States action nor was there evidence that officers of the company might be material witnesses in the action. Barry J. held that what was sought was, in effect, discovery from persons who were not parties to the American litigation. He held that the Burchard case was applicable in terms of the similarity of the applicable legislation. He then ruled as follow (at p. 270):
I hold that under the Foreign Tribunals Evidence Act, 1856, as under the Evidence by Commission Act, 1843, the power to make an order for “the production of any writings or other documents” is ancillary to the order for the examination of witnesses, and that the court has no power to order what is, in effect, discovery against a witness, or to call a witness for examination merely to obtain discovery or to examine him on the documents which may be in his possession or control. Should I be wrong in my view on the question of jurisdiction, I am quite satisfied that, as a matter of discretion, Master GRUNDY’S order, in so far as it relates to the production of documents, cannot be supported. The enforcement of such an order against any company or person not a party to the action would, I think, be grossly oppressive when judged by the standards of our own civil procedure, and I do not propose to judge it by any other standard.
However, Barry J. did uphold the request in the letters rogatory in so far as it related to certain witnesses who apparently could give oral evidence referable to facts relevant to the trial of the American action and directed production of related documents, subject to the right of the witnesses to refuse to answer questions that would incriminate them either under United States or English law.
This latter order was set aside on appeal, it being the view of the Queen’s Bench Division that what was being sought was disclosure of material for the purpose of pre-trial proceedings in the United States and which might lead to a line of inquiry through which relevant trial testimony
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might be disclosed. It was held that the English Act of 1856 did not permit an order which had that effect, an order which was really one for discovery. Devlin J., in his reasons referred also to the Burchard case and continued as follows (at p. 552):
In that authority the distinction is made plain between what I have called discovery or indirect material on the one hand, and proof or direct material on the other hand. That is, I think, the true distinction with which one must approach the word “testimony” in this Act. Testimony which is in the nature of proof for the purpose of the trial is permissible. Testimony, if it can be called “testimony”, which is mere answers to questions on the discovery proceeding designed to lead to a train of inquiry, is not permissible. Into which category does the present fall? It might perhaps be enough to say that it is plain enough from what I have said of the nature of proceedings in the court in Illinois that they fall into the category of pre-trial proceedings, proceedings by way of discovery…
Earlier in his reasons, he put the matter in these words (at p. 551):
The distinction is not whether what is to be obtained is documentary material or oral material. The distinction is whether it is a process by way of discovery and testimony for that purpose or whether it is testimony for the trial itself.
In Penn-Texas Corporation v. Anstalt and Others (No. 1), [1963] 1 All E.R. 258, and in Penn‑Texas Corporation v. Murat Anstalt and Others (No. 2), supra, each decided by different panels of the English Court of Appeal, the main issue was whether a limited company could be ordered in response to letters rogatory and under the English Act of 1856, to be examined under oath. In both cases, it was held that the Act did not authorize such an order but that it was permissible to order a limited company to produce existing and specified documents for the purposes of trial in the foreign court and not for discovery or for pre-trial proceedings. There are indications in these cases, and I refer especially to the reasons of Pearson L.J. in the second Penn-Texas case, at pp. 601-02, that production of documents only by a
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witness should be limited to situations where his testimony is required under the letters rogatory. In the first Penn-Texas case, Davies L.J. dealt, at p. 273, with an argument, based on the Burchard case that the English Act of 1856 is directed to oral examination of a witness and that it is impracticable to order production of a document unless the command is directed to a person. He said this:
There is no doubt that LORD ESHER, M.R., and FRY, L.J., in Burchard v. Macfarlane, Ex p. Tindall, did, in effect, express the view that the provisions of the Evidence by Commission Act, 1843, similar to those under discussion here, applied to the production of documents by a witness and not otherwise; and this expression of opinion was followed by BARRY, J., in Radio Corpn. of America v. Rauland Corpn. But the real ratio of the decision in Burchard’s case was that the application was an attempt to obtain discovery from someone who was not a party to the suit. And similarly the ratio of the decision of the Divisional Court in the Radio Corpn. case was that the application was part of pre-trial discovery. Once it is conceded, as it is in the present case, that the application is one for evidence to be used at the trial and is a part of trial procedure, then these two authorities are not, as I understand them, a bar to the present application. The production of a document may well be said to be ancillary to oral evidence, even though the document is produced by someone other than the person who gives the oral evidence. And the fact that a company can only comply with an order by instructing its proper officer to do what is necessary is no argument for the proposition that an order cannot be made against a company.
For me, the reasons of Willmer L.J. in the first Penn-Texas case are cogent and compelling. He asked and answered the following question (at p. 264):
I pass, therefore, to the second question, namely, whether a limited company can be required to attend by its proper officer before the examiner for the purpose simply of producing documents. I am prompted to ask at the outset: “Why not?” It seems to me that this question depends entirely on the true construction of s. 1 of the Foreign Tribunals Evidence Act, 1856, which in terms authorises the court to command the attendance of any person or the production of any writings or other docu-
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ments. As a matter of construction, I entertain no doubt that the verb “command” governs both “the attendance of any person” and “the production of any writings or other documents”.
Turning to the Burchard case, he noted that it turned on an attempt to obtain discovery from two persons who were not parties to the action. He then went on to say this (at p. 265):
Nor do I think that the dicta of LORD ESHER, M.R., and FRY, L.J., can be relied on as laying down that in no circumstances can the court command production of documents from any person other than a witness in the case.
The power to command the production of documents is quite general, and the Act does not say that they can be required to be produced only by a witness giving oral evidence. The words of the Act are wide enough to embrace a command to any person shown to be in fact in possession of the documents required.
The English Court of Appeal returned to the matter in Panthalu v. Ramnord Research Laboratories, Ltd., [1965] 2 All E.R. 921, in relation to the application by a plaintiff in an action in India for the taking of commission evidence under the Evidence by Commission Act, 1859, being similar to the 1856 Act. The evidence was sought from named witnesses, employees of a company, and, concurrently, production of documents by those witnesses. The company did not object to the production but the defendants did. The Court ordered the production. In the course of his reasons, Sellers L.J. said this (at p. 923):
With regard to documents there is no specific request with regard to their production, but I agree with MEGAW, J., that this court is not precluded by that omission from ordering production of documents which the evidence makes relevant.
The real issue between the parties is whether the documents sought are ancillary to any evidence which may be given, or whether the plaintiff by this machinery is merely seeking discovery of documents which has been disallowed, at the present stage of the action, in India.
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Davies L.J. went further and purported to sum up the course of decision in the cases, previously canvassed in these reasons, as follows (at p. 927):
(i) The court will only order the production of documents when such production is ancillary to the oral testimony of a witness, (ii) The court will not make an order under the Act if what is being sought is in effect discovery of documents against a person not a party to the action. (iii) The court will not make an order for indirect or pretrial testimony, whether by oral evidence or by production of documents; it will only order direct testimony, oral or documentary, for the trial of the action.
American Express Warehousing, Ltd. v. Doe and Others, [1967] 1 Lloyd’s Rep. 222, also a judgment of the English Court of Appeal, is along the same lines. It affirms that letters rogatory will be supported for the oral examination of non-party witnesses who are asked to produce documents with them which are ancillary to their oral evidence where the evidence is required for trial and not for discovery. The difference between American procedure, under which discovery may be had from a non-party and English procedure which forbids this, was emphasized here as it had been in earlier cases. The Alberta Court of Appeal relied on this case, as it did on earlier cases, as laying down the rule under the English Act of 1856, comparable to s. 43 of the Canada Evidence Act, that production of documents will only be ordered if ancillary to oral evidence.
As I have already indicated, I much prefer the approach of Willmer L.J., one more consonant with the views expressed in this Court as to the desirability of a broad liberal construction of legislation such as s. 43 of the Canada Evidence Act in the interests of comity.
Finally, I wish to refer to the judgment of Steele J. in the Medical Ancillary Services case, supra. He held that s. 43 did not authorize an order, in support of letters rogatory, for the production of documents by a limited company, although this
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was permissible under the allegedly wider s. 60 of The Evidence Act of Ontario, R.S.O. 1970, c. 151 and also permissible under the English Act of 1856, although the company could not itself be required to give evidence as a witness.
Steele J. distinguished the English and Canadian provisions by reference not only to formulation but as well to difference to punctuation. For convenience of assessment, I set out the respective provisions:
English Act of 1856
Canada Evidence Act
I. Where, upon an Application for this Purpose, it is made to appear to any Court or Judge having Authority under this Act that any Court or Tribunal of competent Jurisdiction in a Foreign Country, before which any Civil or Commercial Matter is pending, is desirous of obtaining the Testimony in relation to such Matter of any Witness or Witnesses within the Jurisdiction of such first-mentioned Court, or of the Court to which such Judge belongs, or of such Judge, it shall be lawful for such Court or Judge to order the Examination upon Oath, upon Interrogatories or otherwise, before any Person or Persons named in such Order, of such Witness or Witnesses accordingly; and it shall be lawful for the said Court or Judge …or any other Judge having Authority under this Act, by any subsequent Order, to command the Attendance of any Person to be named in such Order, for the Purpose of being examined, or the Production of any Writings or other Documents to be mentioned in such Order, and to give all such Directions as to the Time, Place, and Manner of such Examination, and all other Matters connected therewith, as may appear reasonable and just; and any such Order may be enforced in like Manner as an Order made by such Court or Judge in a Cause depending in such Court or before such Judge.
- Where, upon an application for that purpose, it is made to appear to any court or judge, that any court or tribunal of competent jurisdiction, in the Commonwealth and Dependent Territories, or in any foreign country, before which any civil, commercial or criminal matter is pending, is desirous of obtaining the testimony in relation to such matter, of a party or witness within the jurisdiction of such first mentioned court, or of the court to which such judge belongs, or of such judge, the court or judge may, in its or his discretion, order the examination upon oath upon interrogatories, or otherwise, before any person or persons named in the order, of such party or witness accordingly, and by the same or any subsequent order may command the attendance of such party or witness for the purpose of being examined, and for the production of any writings or other documents mentioned in the order, and of any other writings or documents relating to the matter in question that are in the possession or power of such party or witness.
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This is what Steele J. said about them (at p. 410):
In considering the power of the Court under the Canada Evidence Act, it should be noted that there are differences between it and the English Act, which differences are as follows: (1) Provisions between the power of the Court to order a witness to attend and the power of the Court to order the attendance of any person for examination or for the production of writings or documents is separated by a semicolon. This is not so in the Canada Evidence Act. (2) In the English Act, in the second part, reference is made to the examination of a person for the purpose of being examined or for production. In the Canada Act there are two differences. Reference is made only to a party or witness—not a person—and also in the Canada Act reference is made for the examination and production rather than the word or in the English Act. Having reviewed the reasoning in the Penn-Texas Corp. case, I am of the opinion that such reasoning is not applicable to the interpretation of the Canada Evidence Act with respect to the production of documents. The Canada Act refers only to a party or witness and uses the conjunctive word “and” with respect to production. I am, therefore, of the opinion that under this Act, it is only a witness who may be compelled to attend for examination that may be compelled to make productions.
The Ontario Act does not include the semicolon that is in the English Act but it does use the word “person” and the word “or” that are in the English Act. I am of the opinion that the reasoning in the Penn-Texas Corp. case is applicable to the Ontario Act, and, therefore, under s. 60 of the Ontario Act, a company may be ordered to make production on an application for letters rogatory.
The semicolon issue raised by Steele J. is not compelling in the light of the English statute on which he dwells for the distinctions he would make; it is the extreme of technicality to found a distinction between the presence of a semicolon in the English statute and a comma in the similar place in the Canadian provision. Nor am I taken by the contrast made by Steele J. between “party or witness”, in the Canadian Act and “person” in the English Act. In the opening words of the English Act the reference is to the testimony of any witness or witnesses, and the subsequent change of characterization by use of the word
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“person” is surely a neutral reference which envisages the person becoming a witness. What remains then by way of distinction is the word “or” in the English act and the word “and” in the Canadian Act when reference is made to the examination of witnesses and production of documents. Certainly, if some of the observations in the English cases relied on by Lieberman J.A. in the present case espouse his ancillary position, then what price the word “or”? If in those cases it can be read conjunctively, I can have little difficulty in reading “and” disjunctively. Take, for example, Criminal Code, s. 628 respecting subpoenas to attend to give evidence “and, if required”, to bring with him any relevant writings in his possession. Can it be said that “and” excludes a subpoena for production of documents alone?
Moreover, it appears to be the view of Salmon L.J. in the American Express Warehousing case, at p. 227, that a few questions of witnesses, asked to produce documents as requested under the foreign letters rogatory, would suffice to satisfy the requirement of making production ancillary to oral evidence. That, if true, surely reduces the ancillary doctrine to an absurdity.
Should the Order of Miller J. be Restored
Miller J. fully endorsed the considerations of comity that supported the lending of assistance to the United States Court, subject only to the established guidelines set out in various Canadian decisions for meeting Canadian requirements. These, in his view, included the following: (1) Was the evidence required for trial or for discovery? (2) Was the testimony relevant? (3) Was the inquiry of a scope that would not be allowed in Alberta? (4) Were the documents requested described or defined with adequate precision? As to (1), Miller J. was satisfied that the evidence was required for trial; as to (2), subject to a question concerning certain material picked up as a result of intercepted telephone conversations, relevancy was a matter for the commissioner taking the evidence (should an order be made) or for the United States Court
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or perhaps for both but it was not for him; as to (3), there was no offence to this guideline; and as to (4), the material requested in Exhibits 1(a), 1(b), 1(c) and 1(d) and the tapes mentioned in Exhibit 2 (subject to certain limitations to be discussed), could be sufficiently described to satisfy that guideline.
I wish to add a word on the respondents’ contention that the evidence was required for discovery and not for trial. The prosecution’s position was clear that the evidence was directed to the trial alone, but in accordance with the governing procedure, the accused were entitled to advance notice of the documents to be tendered at trial and could view them. There was no question hence of seeking information by way of discovery as ordinarily understood, and the accused could not properly assimilate the process, intended for their advantage, to something akin to discovery.
I am content to support Miller J. in his observations on the relevant guidelines that he chose to follow, subject to consideration of the position of tapes of certain intercepted telephone conversations.
The main concern about the intercepted telephone conversations related to those of two defendants in the American proceedings, Mark and Nina Popovich. The tapes of these conversations were submitted to the Laycraft inquiry. Justice Laycraft was of the opinion, expressed in his report to the provincial Attorney General, that the police did not have the required authorization under Canadian law to intercept the calls coming to or emanating from a trailer occupied by the Popovich couple, who were part of the Royal American entourage in Edmonton. However, after considering Criminal Code, s. 178.2, (making it an offence in the stated circumstances wilfully to use or disclose an intercepted private communication without the express or implied consent of the originator or recipient) and also s. 178.16 (which makes inadmissible in evidence an intercepted pri-
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vate communication against the originator or recipient unless the interception was lawfully made or there was express consent to its admission), Justice Laycraft held that s. 178.16 did not apply where the contents of the intercepted conversations were not to be used against the originator or recipient and, in any event, did not apply to a public inquiry since there was no one on trial in such a proceeding. He went on to say that if, s. 178.16 did apply, the intercepted conversations could be admitted in another proceeding in which they would not be adduced directly against the Popovich couple. In the result, he admitted the tapes which thus became matters of public knowledge.
Miller J. accepted Justice Laycraft’s view that s. 178.16 only forbade admission into evidence against the originator and recipient of intercepted private communications not lawfully authorized or whose admission was not consented to, and did not preclude their use against others. He concluded that the intercepted conversations did not come within the exceptions in s. 178.2(2)(a) so as to justify an order for their admission under s. 43 of the Canada Evidence Act as against the Popovich couple. However, if, at a s. 43 hearing, it appeared to the hearing officer that the contents of those conversations were relevant to charges against other accused who were not parties thereto, disclosure of the tapes or a transcript of the conversations would not violate s. 178.16 and would not give rise to an offence under s. 178.2(1).
Section 178.16, so far as relevant here, reads as follows:
178.16 (1) A private communication that has been intercepted is inadmissible as evidence against the originator of the communication or the person intended by the originator to receive it unless
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(a) the interception was lawfully made; or
(b) the originator thereof or the person intended by the originator to receive it has expressly consented to the admission thereof;
but evidence obtained directly or indirectly as a result of information acquired by interception of a private communication is not inadmissible by reason only that the private communication is itself inadmissible as evidence.
(2) Notwithstanding subsection (1), the judge or magistrate presiding at any proceedings may refuse to admit evidence obtained directly or indirectly as a result of information acquired by interception of a private communication that is itself inadmissible as evidence where he is of the opinion that the admission thereof would bring the administration of justice into disrepute.
(3) Where the judge or magistrate presiding at any proceedings is of the opinion that a private communication that, by virtue of subsection (1), is inadmissible as evidence in the proceedings
(a) is relevant to a matter at issue in the proceedings, and
(b) is inadmissible as evidence therein by reason only of a defect of form or an irregularity in procedure, not being a substantive defect or irregularity, in the application for or the giving of the authorization under which such private communication was intercepted,
he may, notwithstanding subsection (1), admit such private communication as evidence in the proceedings.
Section 178.2 should also be noticed here, so far as relevant, and it is in these terms:
178.2 (1) Where a private communication has been intercepted by means of an electromagnetic, acoustic, mechanical or other device without the consent, express or implied, of the originator thereof or of the person intended by the originator thereof to receive it, every one who, without the express consent of the originator thereof or of the person intended by the originator thereof to receive it, wilfully
(a) uses or discloses such private communication or any part thereof or the substance, meaning or purport thereof or of any part thereof, or
(b) discloses the existence thereof,
is guilty of an indictable offence and liable to imprisonment for two years.
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(2) Subsection (1) does not apply to a person who discloses a private communication or any part thereof or the substance, meaning or purport thereof or of any part thereof or who discloses the existence of a private communication
(a) in the course of or for the purpose of giving evidence in any civil or criminal proceedings or in any other proceedings in which he may be required to give evidence on oath where the private communication is admissible as evidence under section 178.16 or would be admissible under that section if it applied in respect of the proceedings;
(3) Subsection (1) does not apply to a person who discloses a private communication or any part thereof or the substance, meaning or purport thereof or of any part thereof or who discloses the existence of a private communication where that which is disclosed by him was, prior to such disclosure, lawfully disclosed in the course of or for the purpose of giving evidence in proceedings referred to in paragraph (2)(a).
It was contended, on behalf of the Popovich couple that if the interceptions were unlawful, as determined in the Laycraft inquiry, an order directing a police officer to disclose the conversations at a s. 43 hearing might expose him to a criminal charge under Criminal Code s. 178.2. In short, to obey an order under s. 34 might involve a breach of Canadian criminal law. Presumably, according to Miller J., if an order should be made by him directing production of the tapes, the police officers so ordered would feel bound to produce them. The matter was not one to be left to the hearing officer under s. 43. However, as already noted, the tapes or transcripts were not to be used in a s. 43 hearing against the Popovich couple but could be used againsts others if relevant to charges against those others.
It is, of course, a central question whether the disclosure of the contents of the conversations against others would not prejudice the Popovich couple as defendants in the American proceedings. Whether the illegally intercepted conversations would be inadmissible in the United States trial is, it may be said, a matter for the American Court.
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Since the material was relevant to the charges in the United States, Miller J. was content to limit the use of the telephone conversations by making them admissible at a s. 43 hearing against the accused other than the Popovich couple.
I would not interfere with this determination since it must be left to the United States courts to decide, in accordance with the governing law there, whether the tapes or transcripts of the illegally intercepted conversations would be admissible at all or to what extent.
Another point taken by the respondents invoked s. 178.16(3.1) which on its face is directed to enlargement of the admissibility of an intercepted private communication. It reads as follows:
178.16…
(3.1) A private communication that has been intercepted and that is admissible as evidence may be admitted in any criminal proceeding or in any civil proceeding or other matter whatever respecting which the Parliament of Canada has jurisdiction, whether or not the criminal proceeding or the civil proceeding or other matter relates to the offence specified in the authorization pursuant to which the communication was intercepted.
The respondents’ submission obviously fastens on the words “that is admissible as evidence”, and since the Popovich tapes were not admissible against them respondents seek to erode the application of the provision. In view of the determination that the intercepted communication, if relevant to charges against others, could be admitted against them, I do not see how the respondents’ position can be maintained. Over and above this, s. 178.16(3.1) appears from its concluding words to envisage an authorized interception and hence would have no application to the present case.
A number of other submissions opposing the application for judicial assistance were considered and rejected by Miller J. One such submission was that the application was designed to enforce American revenue laws because a conviction for tax evasion (criminal charges of that kind were
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involved here) estopped a taxpayer from disputing his tax liability in any subsequent civil proceedings. Since what was involved in the application before him were criminal charges, Miller J. concluded, and rightly so, that there was no question of assisting in the collection of taxes by a foreign country.
A second submission in resisting an order under s. 43 was that some of the documents whose production was sought were in the possession of the Department of National Revenue and that only the Federal Court could make an order with respect to them and, moreover, they were in Saskatchewan, outside of the geographical jurisdiction of the Alberta Court. This objection was also overruled when it appeared that the Department was neutral on the matter and was only concerned to keep the originals. If an order for production was made, it would be for the Minister to consider whether the documents should be produced. The extraterritorial argument was met by applying the Alberta Rules of Court, in the absence of any rules under s. 48 of the Canada Evidence Act, and under those Rules, an order could be made for examination of a person resident outside the Province. Although nothing was said of compulsory process, Miller J. anticipated that counsel for the Department would co-operate to make an employee of the Department available with the relevant documents without the necessity of an order under the Alberta Rules.
Finally, an argument was mounted on the basis of Criminal Code s. 446 which was alleged to be a complete code for the retention and disposition of seized material. It will be recalled that an order had been made by Judge Rolf for a return of seized material to the original owners, being Royal American Shows Inc. and certain concessionaires, some of whom were defendants in the United States Court. If they had been returned, s. 47 of the Canada Evidence Act would have provided protection to persons being examined in a s. 43 hearing in respect of incriminating documents. At the time of the proceedings before Miller J. the
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order of Judge Rolf was under appeal and there was a further order of a judge of the Court of Queen’s Bench, made on consent, that the material would be kept safe and undisturbed until the appeal was concluded. The point was, accordingly, taken that there was no right to disturb this consent order, especially when made by a judge of co-ordinate jurisdiction.
Criminal Code, s. 446 reads as follows:
- (1) Where anything that has been seized under section 445 or under a warrant issued pursuant to section 443 is brought before a justice, he shall, unless the prosecutor otherwise agrees, detain it or order that it be detained, taking reasonable care to ensure that it is preserved until the conclusion of any investigation or until it is required to be produced for the purposes of a preliminary inquiry or trial, but nothing shall be detained under the authority of this section for a period of more than three months after the time of seizure unless, before the expiration of that period,
(a) a justice is satisfied on application that, having regard to the nature of the investigation, its further detention for a specified period is warranted and he so orders; or
(b) proceedings are instituted in which the thing detained may be required.
(2) When an accused has been committed for trial the justice shall forward anything to which subsection (1) applies to the clerk of the court to which the accused has been committed for trial to be detained by him and disposed of as the court directs.
(3) Where a justice is satisfied that anything that has been seized under section 445 or under a warrant issued pursuant to section 443 will not be required for any purpose mentioned in subsection (1) or (2), he may,
(a) if possession of it by the person from whom it was seized is lawful, order it to be returned to that person, or
(b) if possession of it by the person from whom it was seized is unlawful,
(i) order it to be returned to the lawful owner or to the person who is entitled to possession of it, or
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(ii) order it to be forfeited or otherwise dealt with in accordance with law, where the lawful owner or the person who is entitled to possession of it is not known.
(4) Nothing shall be disposed of under subsection (3) pending any proceeding in which the right of seizure is questioned, or within thirty days after an order is made under that subsection.
(5) Where anything is detained under subsection (1), a judge of a superior court of criminal jurisdiction or of a court of criminal jurisdiction may, on summary application on behalf of a person who has an interest in what is detained, after three clear days notice to the Attorney General, order that the person by or on whose behalf the application is made be permitted to examine anything so detained.
(6) An order that is made under subsection (5) shall be made on such terms as appear to the judge to be necessary or desirable to ensure that anything in respect of which the order is made is safeguarded and preserved for any purpose for which it may subsequently be required.
(7) A person who considers himself aggrieved by an order made under subsection (3) may appeal from the order to the appeal court, as defined in section 747, and for the purposes of the appeal the provisions of sections 749 to 760 apply, mutatis mutandis.
Miller J. felt that he should not or could not override the consent order, and hence he made a conditional disposition by postponing the hearing under s. 43 of the Canada Evidence Act until the appeal from Judge Rolfs order had taken place and a determination made. In my opinion, if the time period specified in s. 446(1) had not yet run, I would have had no hesitation in holding that the proceedings in the present case were “proceedings …in which the thing detained may be required”, as stipulated in s. 446(1)(b). However, the three month period specified in s. 446(1) had long ago expired and, like Miller J., I do not think it would be proper to interfere with the consent order for the preservation of the seized material pending the disposition of the appeal from Judge Rolf’s order.
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Miller J. would otherwise have acted under s. 446(5) and (6) to order the production of the seized materials for the purposes of a hearing under s. 43 of the Canada Evidence Act, with proper safeguards for the preservation of the materials and for their ultimate return to their owners or for their use in the courts. He speculated that if the appeal from Judge Rolf’s order was successful and the materials are then detained for possible further use by the Department of National Revenue in proceedings against the owners, he could make an order under s. 446(5). If the appeal failed and Judge Rolfs order (which directed return of the materials within thirty days after it becomes effective) stands, Miller J. felt that he could make an order under s. 446(5) within the thirty-day period for the purpose of an examination under s. 43 of the Canada Evidence Act. As matters stood at the time, he made the conditional order to which I referred above.
Events relevant to this case have taken place since Miller J. gave his reasons on September 13, 1979 and made his formal order on November 28, 1979 and I wish to review them. I referred earlier in these reasons to an order of Judge Rolf. It was made on February 26, 1979, and it purported to order the return of detained documents to their owners after a period of thirty days. It also authorized, purportedly under Criminal Code, s. 446(5), the States of Minnesota and Wisconsin to examine and copy the material. On March 2, 1979, Steer J. of the Alberta Court of Queen’s Bench made a sealing order on consent in respect of the documents, and directed that Judge Rolfs order for their return be stayed until further order. Following an application by way of certiorari to quash Judge Rolf’s order in favour of Minnesota and Wisconsin on the ground that he did not have jurisdiction to act under s. 446(5), Bowen J. made an order on May 30, 1979 setting aside that order of Judge Rolf.
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On October 23, 1979, Bowen J. made a further order directing that certain articles and documents be detained until such time as they may be used as required by the Attorney General of Canada in proceedings against certain of the applicants. On August 28, 1980, Purvis J. of the Alberta Court of Queen’s Bench made a consent order for the delivery of the articles and documents in question here to the solicitor for Royal American Shows, Inc. and the individuals associated with that enterprise, but directed further that delivery be delayed until the appeal from the order of Miller J. is formally determined and delivery was to be subject also to such further order as might be made. Purvis J. also directed that the sealing order of Steer J. remain in effect until the delivery of the articles and documents as provided in his order, at which time the order would be vacated subject only to any further order in respect of the appeal pending to the Alberta Court of Appeal.
It appears, therefore, that Miller J.’s order was eclipsed by events, of which one at least (the order of Purvis J.) could not have been within his knowledge. Even if Judge Rolfs order had remained in force (and I should add that it was appealed by the Minister of National Revenue) the thirty-day period specified therein had long ago expired.
In the circumstances, I think it is open to this Court to make an appropriate order for a s. 43 hearing before former Justice Primrose on the terms reflected in the order of Miller J., as set out in paragraphs 1 to 5 thereof. If paragraph 6 of that order has already been acted on, nothing more need be said. If not, I would refer the matter to Miller J. for disposition.
In the result, I would allow the appeal, set aside the order of the Alberta Court of Appeal and direct an order in the terms prescribed by Miller J. as above mentioned. Despite the different results reached in the courts below, no costs were ordered. In these circumstances, I too would make no order
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as to costs.
Appeal allowed.
Solicitors for the appellant: Short reed, Shoctor, Edmonton.
Solicitors for the applicant: Field & Field, Edmonton.
Solicitors for the respondents: Macdonald, Spitz, Edmonton.