BARRIE COURT FILE

COURT FILE NO.: CV-12-0143-SR

DATE: 20140402

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

JAMES MURRAY KIERANS

Plaintiff

– and –

THE CORPORATION OF THE TOWN OF COLLINGWOOD

Defendant

Oliver Bremer, for the Plaintiff

Maurizio Artale, for the Defendant

HEARD: March 28, 2014

REASONS FOR DECISION

DiTOMASO J.

THE MOTION

[1] The Plaintiff Kierans brings a motion for an order directing the Defendant The Corporation of the Town of Collingwood (“the Town”) to produce for the inspection by this Honourable Court certain documents in respect of which the Town has claimed litigation privilege. Those documents are referred to globally in Schedule B of the Town’s Amended Affidavit of Documents dated March 7, 2013 (see Motion Record Tab 2 Exhibit B at p.25).

[2] Previously, Mr. Kierans sought production of “all Adjusters’ notes, memoranda and correspondence (which he referred to as “unspecified Adjusters’ documents)”. That part of this motion has been resolved.

[3] However, Mr. Kierans seeks production for inspection of those documents that form the Table at Schedule B more specifically described as document numbers 1 to 7 inclusive; documents numbers 11 - 34 inclusive; document numbers 36 - 62 inclusive; and documents numbers 64 – 66 inclusive which were identified by Mr. Kierans as “specified documents”. The motion was opposed by the Town.

FACTS

[4] In this action, Mr. Kierans alleges damages were caused to his property as a result of flooding on the nearby Batteaux River and holds the Town responsible for failing to contain the flood.

[5] A flood occurred on February 18, 2011. On February 20, 2011, the Town announced that it was going to do a public investigation of the flood. On February 20, 2011 Mr. Kierans emailed the Town stating “as my insurer has declined coverage, I will be holding the Town responsible for the costs involved in doing so.” Mr. Kierans’ email related to a request that he made to the Town to remove water from his premises as soon as possible.

[6] On February 28, 2011, Mr. Kierans put the Town on notice through his solicitors Lencznear Slaght Barristers of his claim which arose out of the flooding of the property that occurred on the afternoon of February 18, 2011. In the notice, Mr. Kierans’ lawyers go on to state that the flooding was caused by an overflow from the Batteaux River. As a result of the flooding, Mr. Kierans suffered extensive damage to his property. Such notice was made pursuant to the provisions of section 44(10) of the Municipal Act, 2001 (Ontario) S.O. 2001, c.25.

[7] On April 18, 2011 Mr. Houghton presented his report regarding the flood to Town Council.

[8] On February 6, 2012 Mr. Kierans commenced his action by way of Statement of Claim. A Statement of Defence was filed on March 9, 2012 and Mr. Kierans replied on March 19, 2012.

POSITIONS OF THE PARTIES

Position of the Plaintiff

[9] On behalf of Mr. Kierans, it is submitted that not only has he advanced a claim for negligence, trespass and nuisance, but also he has advanced a claim for misfeasance in public office. He submits that the specified documents need to be vetted by the Court in order to determine whether or not they are litigation privileged or if they are gathered for evidence in respect of the public report submitted by Mr. Houghton. Given the nature of Mr. Kierans’ claim regarding the misfeasance in public office (see Statement of Claim, Motion Record, Tab 2 Exhibit A p. 16, para. 46 and 47) documents that may speak to cover-up on the part of the Town are not protected by privilege. It is submitted on behalf of Mr. Kierans that there is some concern that there might have been an attempt at cover-up. Therefore, it is argued that this Court needs to look at these documents.

Position of the Town

[10] It is the Town’s position that this motion should be dismissed. The documents set out as specified documents in Schedule B are litigation privileged. They are set out with specificity within the meaning of the case-law and are dated after a Claim was advanced in writing by Mr. Kierans on or about February 20, 2011 and by his lawyers by letter dated February 28, 2011, alleging damage and holding the Town responsible for that damage. Further, the Town contends that Mr. Kierans had existing productions for well over a year and proceeded to Examinations for Discovery without them.

THE ISSUE

[11] The fundamental issue on this motion is whether the specified documents set out in Schedule B were collected for the dominant purpose of defending and investigating Mr. Kierans’ claim.

ANALYSIS

[12] The “specified documents” in Schedule B are dated on or after February 21, 2011. The Clerk of the Town who swore the Affidavit of Documents has further sworn that the emails and documents starting at February 21, 2011 and following were prepared predominantly with the purpose of litigation in mind. I accept her evidence as the Town was put on notice by Mr. Kierans threatening to hold the Town responsible for the cost of damage by email on February 20, 2011. His email was followed up by his formal lawyer’s letter on February 28, 2011 notifying the Town formally of the claim threatened a week before. (See Motion Record, Almes’ Affidavit sworn December 12, 2013 at Exhibit C).

[13] Ms. Almes, the then Town Clerk, swears the documents arise in the context of anticipated litigation from Mr. Kierans. She swears documents were compiled for the purpose of seeking legal advice from counsel. The Town also reported the claim to its insurers on or about March 1, 2011, when the claim the Town believed on February 20, 2011 would materialize and did in fact materialize from Mr. Kierans.

[14] On February 21, 2011 the Town also requested legal advice in respect of information compiled in the documents at that time from their external counsel.

[15] Harold Leiher, referenced in Schedule B privileged emails, was the insurance adjuster for the Town’s insurer.

[16] The Affidavit of Documents is sworn as required and specifies each document, its date and a sufficient description as well as the type of privilege claimed in order to comply. The specified documents are identified either as having solicitor-client privilege or litigation privilege.

[17] In Kavanagh v. Peel Mutual Insurance Company, 2010 ONSC 4653, J.E. Ferguson, J. commencing at para. 10 sets out the law of privilege in Ontario.

[18] At para. 12 in Kavanagh, the court states:

The law of privilege in Ontario is set out in General Accident Assurance Company et al v. Chrusz et al.[^1] In order to fall into the ambit of litigation privilege, litigation, actual or contemplated, must be the dominant purpose for which the document in question is created. Similarly, the Supreme Court of Canada in Blank v. Canada (Minister of Justice), adopted the dominant purpose test.[^2]

[19] For litigation privilege, there will also be an oral or written communication between a lawyer and a client or between a lawyer and a third party made exclusively for the dominant purpose of the client’s contemplated or pending litigation. The burden of showing that a document is subject to litigation privilege lies on the party asserting the privilege.[^3]

[20] The determination of whether litigation is reasonably contemplated as the dominant purpose of the document created will depend on the circumstances of each case.[^4]

[21] I am satisfied that all of the “specified documents” referenced by Mr. Kierans were collected or prepared by the Town for the dominant purpose of defending and investigating Mr. Kierans’ claim. They were copied to the insurance adjuster or then legal counsel, or resulted from, the initiation of an investigation by the Town after the Town received allegations of circumstances which could give rise to a potential claim by Mr. Kierans, either by his email dated February 20, 2011 and definitely by written notice of claim dated February 28, 2011 by his counsel.

[22] It is absolutely clear that Mr. Kierans was holding the Town responsible for damages to his property as early as February 20, 2011. The documents regarding which privilege is claimed with litigation and solicitor-client privilege are itemized 1 through 66 commencing February 21, 2011 – the day after Mr. Kierans had personally put the Town on Notice by his email.

[23] I am satisfied all of the communications starting February 21, 2011 were investigations and communications whose dominant purpose was to investigate Mr. Kierans’ claim with a view towards Mr. Kierans’ contemplated or pending litigation.

[24] I find that the specified documents were prepared for the dominant purpose of obtaining legal advice or legal services for anticipated or pending litigation or for gathering evidence for that litigation. The specified documents are protected by litigation privilege. I am satisfied that the burden of showing that the specified documents are subject to litigation privilege has been established by the Town. There was no mistake or misapprehension by anyone other than Mr. Kierans was holding the Town responsible as early as February 20, 2011. With the certainty of litigation on the horizon, the Town immediately took the necessary steps in the context of anticipated litigation with Mr. Kierans. An item by item review of those documents listed in the Schedule B Table confirm they relate to the dominant purpose test.

[25] I also comment upon the argument advanced on behalf of Mr. Kierans. It is submitted there are concerns in respect of the litigation privilege claimed given the nature of Mr. Kierans’ claim, and in particular, his claim of misfeasance. There was some concern that there might have been an attempt by the Town at a cover-up. This grounded the argument that it was necessary for the court to look at the documents. The documents might be producible for other grounds as well.

[26] I am not persuaded by the argument of Mr. Kierans’ counsel in this regard. At its highest, there is only an articulation of some concern that “there might have been an attempt at a cover-up”. In my view, this concern does not rise above mere speculation and does not defeat the Town’s claim for litigation privilege. There continues to be some issue as to whether or not the allegations of misfeasance in public office are not supported by the pleadings of malice or intentional conduct or bad faith. There continues to be a dispute as to whether Mr. Kierans was not alleging intentional conduct. He maintains that he stands by what he has pleaded.

[27] Nevertheless, Mr. Kierans’ claims regarding misfeasance do not alter my findings whatsoever that from February 21, 2011 onwards, the specified items described by Mr. Kierans are protected by litigation privilege.

CONCLUSION

[28] Accordingly, for the above reasons, the order sought by Mr. Kierans to produce for inspection by this court the specified documents, is hereby dismissed.

[29] In respect of costs, the parties have agreed that costs will be determined by way of written submissions. Counsel shall submit a concise Statement of Position no longer than two pages together with a Costs Outline, Bill of Costs and any relevant authorities. They shall exchange those documents. Written submissions as to costs are to be delivered by the parties to my judicial assistant in Barrie no later than 14 days from the date of this decision.

DiTOMASO J.

Released: April 2, 2014

[^1]: (1999), 1999 7320 (ON CA), 45 O.R. (3d) 321 (C.A.)

[^2]: [2006] 2 S.C.R. 319, 2006 SCC 39 at para. 60

[^3]: Mamaca (Litigation Guardian of) v. Coseco Insurance Co., 2007 54963 (ON SC), [2007] O.J. No. 4899, [2008] O.J. No. 2508 (Div.Ct.)

[^4]: Mamaca (Litigation Guardian of) v. Coseco Insurance Co., supra