ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-12-468533
DATE: 20150609
BETWEEN:
CINDY HOWARD
Plaintiff
– and –
THE CORPORATION OF THE CITY OF LONDON
Defendant
Nicholas Kluge and Niklas Holmberg, for the Plaintiff
Roy C. Filion, Q.C. and Casey Dockendorff, for the Defendant
HEARD: June 1, 2015
FAIETA, j
REASONS FOR DECISION
[1] The defendant appeals an Order issued by Master Short, dated August 11, 2014, (the “Master’s Order”) that required the production of all documents relating to the investigation undertaken by John McNair, including Mr. McNair’s report.
Background
[2] The plaintiff was employed by the defendant as both the Director, Social & Community Support Services for the defendant as well as the Administrator of a long-term care home owned and operated by the defendant (the “Dearness Home”).
[3] On March 2, 2012 a resident of the Dearness Home left the home undetected and was struck and killed while attempting to cross a street in London, Ontario.
[4] The plaintiff commenced an investigation of this tragic incident at the direction of the defendant’s General Manager for Community Services. She was ordered to end her investigation by the City’s Chief of Human Resources on March 5, 2012. The plaintiff was subsequently copied or forwarded several emails pertaining to the retention of a lawyer, John McNair, to investigate this incident. The plaintiff was advised that Mr. McNair’s investigation was for Human Resources purposes and that any Human Resources investigation would be low key and related to more deeply understanding events and providing coaching and mentoring to the staff involved in the incident.[^1]
[5] The plaintiff met with Mr. McNair on three occasions. In March, 2012 the plaintiff walked Mr. McNair through the internal investigation. The plaintiff asked Mr. McNair and Adriana Hagan, of the City’s Human Resources Department, what her legal rights were in meeting with Mr. McNair. They both told the plaintiff that they did not know what legal rights she had.
[6] By a “privileged and confidential” letter dated April 3, 2012 from the defendant’s Interim City Manager, Tim Dobbie, (the “Interim Manager”) the defendant retained a lawyer, John McNair, to investigate this tragic incident on the following terms:
This letter will confirm our meeting in which we discussed your retainer for the purposes of conducting an external investigation in relation to the critical incident involving a resident of the Dearness Home.
This will confirm that we have requested you to act for the Corporation of the City of London (the “City”) with respect to this matter in accordance with the terms of this letter. The scope of your retainer and terms of reference for your external investigation are as follows:
You will conduct an independent external investigation and will prepare a report for the Interim City Manager of the City [the “City Manager”] and submit your report to the Interim City Manager.
Your report will contain findings of fact and independent privileged recommendations, opinions and advice.
The terms of reference for the external investigation will be as follows:
a) Whether the policies, procedures and actions of the City in relation to the administration of the Dearness Home conform with the applicable regulatory standards and meet the test of due diligence in relation to the critical incident;
b) Whether the procedures, policies and measures taken by the City in relation to quality of care and organization effectiveness as they relate to the Dearness Home conform with best practices and establish due diligence in relation [to] the critical incident;
c) Whether the City’s procedures for investigating critical incidents conform to the applicable regulatory standards; and
d) Whether the City’s employees and its representatives complied with applicable policies, procedures and statutory standards from an administrative, operational, corporate, human resources and quality of care perspective in relation to the critical incident. [emphasis added]
[7] The Interim Manager retained Mr. McNair in his capacity as a lawyer because the incident in question and any events leading up to and subsequent to the incident would almost certainly result in litigation.[^2]
[8] The plaintiff’s second meeting with Mr. McNair was held in May 2012. Before that meeting Mr. McNair advised the plaintiff that he had just a few questions and that the investigation was not about the plaintiff or her actions. During the meeting the plaintiff felt intimidated by Mr. McNair and was surprised by his intense questioning of her actions.[^3]
[9] The plaintiff met Mr. McNair again on May 31, 2012. She delivered several documents that Mr. McNair had requested. Prior to the meeting, Mr. McNair told the plaintiff that she was not allowed to have a lawyer present during the meeting.[^4]
[10] On June 1, 2012 the plaintiff was advised by the Interim City Manager that she would have the opportunity to review Mr. McNair’s report and to respond if necessary. No such opportunity was afforded to the plaintiff.
[11] Mr. McNair delivered a report to the City in June 2012. It included findings of fact and legal advice and recommendations based on those facts.[^5]
[12] On June 26, 2012, as a result of improper conduct discovered during Mr. McNair’s investigation, the plaintiff was terminated from her employment with the City for just cause, the details of which were set out in her termination letter.[^6]
[13] On June 27, 2012 an article was published in the London Free Press which states:
…Gone is administrator Cindy Howard after the home’s management was accused by Ontario’s Health Ministry of obstructing an investigation into the death of a resident struck by a car while fleeing the home…The city’s interim city administrator, Tim Dobbie, said later the city must respect Howard’s confidentiality and wouldn’t reveal whether she had been paid. “I’m not at liberty to say any money was paid” he said. Nor would he disclose in detail the findings of an outside lawyer retained by the city to investigate after Dearness management was accused of impeding a Health Ministry probe into the death of 81 year-old Norm Stasyna. Dobbie said lawyer John McNair found evidence of obstruction. But Dobbie also said the evidence was not to the same degree that the ministry found. “(The findings) were not identical, but they were in the same vein,” he said…[^7] [emphasis added]
[14] On June 28, 2012 the London Free Press published another article which stated:
…A lawyer hired by the city later concluded Howard impeded the investigation, but not to the same degree the ministry found…[^8] [emphasis added]
[15] On June 28, 2012 the Mayor of the City of London in speaking of the plaintiff reported on a radio station in London that:
This was a very tragic incident. Our manager, Tim Dobbie, undertook a third party review, as well as the Ministry of Health – those reports came in, and she no longer works for the City and Dearness. Our preoccupation is to make sure we put the right organizational structures in place at Dearness to make sure events like this never happen again.[^9] [emphasis added]
[16] The plaintiff commenced this action for wrongful dismissal in in September 2012 seeking, amongst other things, damages in the amount of $364,000 for wrongful dismissal representing 24 months’ pay and employment benefits ; damages of $100,000 for mental distress and punitive damages of $100,000.
The Master’s Order
[17] This appeal is brought with respect to the Master’s Order which ordered that “…the Defendant produce a copy of the McNair Report and all documents relating to the investigation conducted by Mr. McNair to the Plaintiff…”
The Law
[18] A Master’s decision will be upheld unless the Master: (1) made an error of law, or (2) exercised his or her discretion on the wrong principles or misapprehended the evidence such that there is a palpable and overriding error. A “palpable” error is an error that is plainly seen.[^10]
[19] Rule 30.02 provides that every document relevant to any matter in issue in an action that is or has been in the possession, control or power of a party to the action shall be disclosed as provided in Rules 30.03 to 30.10, whether or not privilege is claimed in respect of the document.
Discussion
[20] The defendant submits that the Master’s decision erred as described below.
Did the Master err in law with regard to the test for determining the existence of solicitor-client privilege?
[21] The appellant alleges that Master suggested that the legal advice sought must be about a specific individual in order for the solicitor-client privilege to apply and thereby erred in law.
[22] The Master did not make any such statement.
[23] The appellant references paragraphs 21, 25 and 31 of the Master’s decision. In those paragraphs the Master questions whether the McNair Report was intended to provide advice in relation to whether the employment of members of the defendant’s staff should be terminated or whether it addressed other matters.
[24] The Master described the case law for determining whether a document is protected by solicitor-client privilege in paragraphs 44 to 59 of his decision. In my view, he did not err in law in stating the law related to the test for determining whether a document is protected by solicitor-client privilege.
Did the Master misapprehend the evidence with respect to events leading up to Mr. McNair’s retainer and with respect to the retainer letter by concluding that it did not request legal advice?
[25] The defendant submits that the Master erred in applying the law to the facts and in finding that the McNair Report was protected by solicitor-client privilege.
[26] At paragraph 68 of his decision the Master found that Mr. McNair was not retained nor consulted in his capacity as a lawyer.
[27] In my view the Master misapprehended the evidence. The retainer letter dated April 3, 2012, referenced above, indicates that Mr. McNair’s firm is being sought to provide legal advice for the following reasons. First, the letter was sent by the defendant to the Mr. McNair’s law firm on a “privileged and confidential” basis. Second, the body of the letter states “…we have requested to act for the Corporation of the City of London”; third the letter states that “…your report will contain findings of fact and independent privileged recommendations, opinions and advice.” The reference to “privilege” makes it clear that Mr. McNair’s advice was sought in his capacity as a lawyer and that the defendant contemplated that such advice would be privileged. Finally, the terms of reference for the investigation ask Mr. McNair to answer whether the defendant, in various capacities, conformed with regulatory standards and met the test of due diligence in relation to the incident. These are questions that necessarily require legal analysis. Accordingly, it is my view that Mr. McNair was retained to provide legal advice to the defendant in respect of the incident at the Dearness Home and this retainer was subject to solicitor-client privilege.
Did the Master err in law in concluding that the “common interest” exception applied?
[28] As the Master cited the Supreme Court of Canada’s decision in Pritchard v. Ontario (Human Rights Commission), 2004 SCC 31, which sets out the test for the common interest exception to solicitor-client privilege, the common interest exception arises:
…where two or more persons, each having an interest in some matter, jointly consult a solicitor, their confidential communications with the solicitor, although known to each other, are privileged against the outside world. However, as between themselves, each party is expected to share in and be privy to all communications passing between each of them and their solicitor. Consequently, should any controversy or dispute arise between them, the privilege is inapplicable, and either party may demand disclosure of the communication…”[^12]
[29] In my view, the Master erred in law in finding that the requirements for “common interest” exception to solicitor-client privilege existed in this case on the basis that: (1) the plaintiff was “intimately involved” in Mr. McNair’s investigation; (2) the defendant should be estopped from asserting a privilege given that she had been repeatedly assured that she had nothing to be concerned about and that she could not have a lawyer in attendance in her meetings with Mr. McNair. In my view, neither of those findings are a basis for establishing the “common interest” exception.
[30] It is clear from the record that Mr. McNair was consulted solely by the defendant for legal advice. The retainer letter was sent by the defendant rather than by the defendant and the plaintiff. There is no evidence that Mr. McNair was ever consulted by the plaintiff in respect of the investigation. The only question asked by the plaintiff of Mr. McNair was whether she should retain counsel before meeting with him. The plaintiff states that Mr. McNair stated that he did not know. The fact that the plaintiff asked that question underlines that Mr. McNair was not being jointly consulted.
Did the Master err in law in concluding that any privilege was waived?
[31] The Master relied upon S & K Processor Ltd. v. Herring Producers Ltd., 1983 407 (BC SC). Madam Justice McLachlin, as she then was, stated:
Waiver of privilege is ordinarily established where the possessor of the privilege (1) knows of the existence of the privilege; and (2) voluntarily evinces an intention to waive the privilege. However, waiver may also occur in the absence of an intention to waive, where fairness and consistency so require. Thus waiver of privilege as to part of a communication will be held to be waiver as to the entire communication…[^14]
[32] The Master concluded that privilege of the McNair Report was waived on the basis of fairness to the plaintiff given the manner in which the investigation was conducted as described, at least in part, in paragraphs 5, 8, 9 and 10 above. In my view, the Master did not commit an error of law in arriving at this conclusion.
[33] In addition, it is my view that the defendant through its representatives disclosed parts of the McNair Report to the public. For instance, as noted above, the London Free Press referring to the plaintiff’s termination of employment reported that “Dobbie said lawyer John McNair found evidence of obstruction” but not to the same degree that the Ministry found. In my view, even if such disclosure does not evince an intention to waive privilege, which in my view it does, it is my view that fairness dictates that the privilege be waived in respect of McNair Report given that the appellant chose to publicly disclose certain findings made by the McNair Report about the respondent.
Did the Master err in relying on portions of the Statement of Claim?
[34] The defendant submits that the Master made an error of law in relying on portions of the Statement of Claim as evidence on the motion. In my view, it is inappropriate for a Court to rely upon the allegations in the Statement of Claim as a basis for making a decision on whether privilege exists or whether it has been waived.
[35] Much of the affidavit evidence filed on this motion is also reflected in the Statement of Claim. Although the Master made several references to matters that were not reflected in the affidavit material filed on this motion, none of those references have any relevance to the determinations that I have made above which are entirely based on the affidavit evidence filed with this Court.
[36] In any event, the plaintiff was unable to explain how the matters addressed solely in the pleadings made any difference to the outcome of the Master’s decision. Accordingly, I do not find that the Master relied upon allegations in the Statement of Claim to determine the issues on this motion, and therefore the Master made no error of law in referring to those allegations.
Conclusion
[37] I hereby dismiss the appeal.
[38] The parties agreed that costs of this motion be fixed at $15,000 regardless of which party was successful. Accordingly, the defendant shall pay costs of $15,000, forthwith, to the plaintiff.
Mr. Justice M. Faieta
Released: June 9, 2015
COURT FILE NO.: CV-12-468533
DATE: 20150609
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
CINDY HOWARD
Plaintiff
– and –
THE CORPORATION OF THE CITY OF LONDON
Defendant
REASONS FOR JUDGMENT
Mr. Justice M. Faieta
Released: June 9, 2015
[^1]: Affidavit of Cindy Howard, sworn July 21, 2014, paras. 10-12.
[^2]: Affidavit of Tim Dobbie, sworn July 24, 2014, para. 8.
[^3]: Affidavit of Cindy Howard, para. 18.
[^4]: Affidavit of Cindy Howard, paras. 20-23.
[^5]: Affidavit of Tim Dobbie, parahs. 10 and 11.
[^6]: Affidavit of Frank A. Angeletti, sworn July 31, 2014, para. 10; Affidavit of Cindy Howard, para. 27.
[^7]: Affidavit of Cindy Howard, Exhibit “L”.
[^8]: Affidavit of Cindy Howard, Exhibit “M”.
[^9]: Affidavit of Cindy Howard, Exhibit “N”.
[^10]: Housen v. Nikolaisen, 2002 SCC 33; Zeitoun v. Economical Insurance Group, 2008 20996 (ON SCDC); aff’d 2009 ONCA 415.
[^12]: Para. 74.
[^14]: Para. 6.