Court File and Parties

CITATION: Manthorne v. Canadian Breast Cancer Network, 2015 ONSC 3799 COURT FILE NO.: 11-52422 DATE: 20150615

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

JACKIE MANTHORNE and MONA FORREST Plaintiffs/Responding Party

– and –

CANADIAN BREAST CANCER NETWORK, CATHY AMMENDOLEA, DIANA ERMEL and SHARON YOUNG Defendants/Moving Party

COUNSEL: Peter Cronyn/Alison McEwen, for the Plaintiffs/Responding Party Mark Charron, for the Defendants/Moving Party

HEARD: May 26, 2015

Reasons for judgment

Beaudoin J.

Nature of the Motion

[1] The Defendants, the Canadian Breast Cancer Network (“CBCN”) and Diana Ermel seek:

1. An order declaring certain documents as being subject to either solicitor-client privilege or litigation privilege;
2. An order requiring the return of those documents; and
3. Removing Nelligan O’Brien Payne LLP (NOP) as Solicitors of Record for the Plaintiffs in these proceedings and other ancillary relief.

[2] The Plaintiffs dispute the claims of privilege made and argue that any privilege that may have been attached to the documents in issue has been waived. To the extent that I find that any of the documents are privileged, NOP claims that there has been no prejudice to any of the Defendants and that the remedy sought by the Defendants is disproportionate to the matters in issue.

Background

[3] The underlying action relates to the termination of employment of the Plaintiffs, Jackie Manthorne and Mona Forrest, on August 16, 2011. The Plaintiffs commenced this claim on September 27, 2011. On March 18, 2013, the Plaintiffs amended their claim adding three Board members of the CBCN as personal Defendants. The Plaintiffs later amended their claim a second time, on December 2, 2014, seeking additional damages against two of the personal Defendants, Cathy Ammendolea and Sharon Young, based on the alleged tort of intrusion upon seclusion.

[4] CBCN and the personal Defendants deny the Plaintiffs’ claim that they were wrongfully dismissed and have taken the position that the Plaintiffs’ employment was terminated for cause as more specifically set out in the pleadings.

[5] CBCN is a not-for-profit, survivor-directed, national network of organizations and individuals. It is a national link between groups and individuals concerned about breast cancer, and represents the concerns of Canadians affected by breast cancer and those at risk. At all material times, the personal Defendants (Ms. Ammendolea, Ms. Young, and Ms. Ermel) were members of CBCN’s Board of Directors and its Executive Committee.

[6] Ms. Manthorne was previously employed by CBCN as an Executive Director and her title was later changed to Chief Executive Officer. Ms. Forrest was the Director of Development and her title was later changed to Deputy Executive Officer. While neither of the Plaintiffs was a member of CBCN’s Board of Directors, they occupied executive positions within the organization.

[7] Pleadings in the action have been exchanged, documentary productions are substantially completed, and some examinations for discovery have been conducted, although, given the recent amendments to the Statement of Claim, more may be scheduled. The action has not yet been set down for trial.

[8] All four Defendants were initially represented by Borden Ladner Gervais LLP (“BLG”), but since the amendment of the Statement of Claim in December 2014, Ms. Ammendolea and Ms. Young are represented by separate defence counsel. The Plaintiffs have been represented by NOP throughout this litigation.

Inadvertent Disclosure of Documents over which Privilege is Claimed

[9] In June 2013, the Defendants served an Affidavit of Documents on behalf of CBCN. Shortly thereafter, on June 10, 2013, counsel for the Plaintiffs advised that it appeared that two documents in Schedule “A” of CBCN’s Affidavit of Documents were privileged and may have been produced inadvertently. Counsel for the Plaintiffs returned the documents, confirmed that copies had not been retained, and that no use would be made of the documents or their contents.

[10] In early August 2013, BLG advised that a further three privileged documents had been inadvertently disclosed to the Plaintiffs and sought their return. Although one of the three documents was previously returned to BLG in June 2013, Plaintiffs’ counsel initially refused to return the unredacted versions of the other two documents and disputed the claim of privilege. There was a further exchange between counsel and the issue was ultimately resolved.

[11] Following the addition of the personal Defendants in 2013, further Affidavits of Documents were prepared by BLG. BLG retained a third party firm, ATD Legal, to review over 13,000 documents obtained from the Defendants and to code them for relevance and privilege. BLG provided ATD Legal with written instructions for the documentary review that included a list of CBCN’s lawyers’ names in respect of whom it claimed privilege. Among these names was Trina Fraser, a pro bono lawyer for CBCN, lawyers from Emond Harnden LLP, who were also retained by CBCN at times material to this litigation, and the lawyers at BLG who had carriage of the litigation.

[12] BLG claims that certain privileged documents were inadvertently coded by ATD Legal as being Schedule “A” documents instead of Schedule “B” documents. Counsel also identified further redactions that were required to certain Schedule “A” documents that were previously produced in redacted form. BLG then identified ten documents in the Plaintiffs’ Affidavit of Documents over which it claims privilege.

[13] Another exchange of correspondence ensued. In December 2013, counsel for the Plaintiffs attempted to examine Ms. Ammendolea on the portions of one of the disputed documents. Again, extensive correspondence was exchanged and this motion was ultimately brought by the Defendants, CBCN and Ermel.

[14] Counsel for the Plaintiffs confirmed in January 2015 that her clients’ copies have been returned to her and that these have now been sealed but have been reviewed by counsel for the purposes of this motion. The disputed documents were then sealed and filed with the court on the return of the motion which was heard in camera by Consent Order of Hackland, J.

[15] There are 24 documents in issue. Five of these are all various copies of the same documents; namely a chronology prepared by the Plaintiffs before their employment was terminated. The Plaintiffs agreed to further redactions of one other document. This leaves 19 documents to be reviewed. Ten of these were in the Plaintiffs’ possession before they retained NOP.

Issues to be decided

[16] These are the issues to be decided:

1. Are the disputed documents, or portions of those documents, privileged?
2. Do the Plaintiffs have common or joint interest privilege in the documents or communications such that privilege cannot be asserted against them?
3. Was privilege waived by CBCN?
4. In these circumstances, should NOP be removed as counsel of record?

[17] The application of joint or common interest privilege is of central importance in this motion, but a short review of solicitor-client privilege, litigation privilege and waiver of privilege is necessary.

Solicitor-Client Privilege

[18] In order to claim solicitor-client privilege, the oral or written communication must be legal advice sought from a legal advisor in his or her capacity as a legal advisor. The communication must be made and intended to be made in confidence by the client. It is permanently protected from disclosure unless it is waived or falls within certain strictly defined exceptions.[^1]

Litigation Privilege

[19] In General Accident Assurance Co. v. Chrusz (1999), 1999 CanLII 7320 (ON CA), 45 O.R. (3d) 321 (ONCA); 180 D.L.R. (4th) 241, the Court of Appeal adopted the dominant purpose test for asserting a claim of litigation privilege. The Court said this at para. 151:

Litigation privilege claims should be determined by first asking whether the material meets the dominant purpose test. If it meets that test, then it should be determined whether in the circumstances the harm flowing from non-disclosure clearly outweighs the benefit accruing from the recognition of the privacy interest of the party resisting production.

Waiver

[20] Waiver usually requires a clear intention on the part of the holder of the privilege. An express waiver of privilege will occur where the holder of the privilege (1) knows of the existence of the privilege; and (2) voluntarily evinces an intention to waive it. Waiver may also occur in the absence of an express intention to waive, it is only where fairness and consistency so require it.[^2]

Joint or Common Interest Privilege

[21] Where a third party has a joint interest with a client in the subject matter of the communication, even though the parties have not jointly retained a lawyer, they have a joint interest in the subject matter of the communication at the time that it comes into existence; both clients enjoy solicitor-client privilege. As between the two of them, no privilege attaches to any communications between them and their lawyers. It is not necessary to establish a particular kind of relationship. As long as the relationship is one created by the joint interest, privilege will not attach.[^3]

[22] The joint interest exists at the time of the communication. Where joint interest privilege is established, it operates similarly to a joint retainer in that the communications remain privileged vis à vis the outside world, but not between the parties themselves.[^4]

[23] Joint consultation with one solicitor by two or more parties for their mutual benefit poses a problem of relative confidentiality. As against others, the communication to the solicitor was intended to be confidential and thus is privileged. However, as between themselves, each party is expected to share in and be privy to all communications passing between either of them and their solicitor, and, accordingly, should any controversy or dispute subsequently arise between the parties, then, the essence of confidentiality being absent, either party may demand disclosure of the communication.

[24] More recently in Boudreau v. Loba, 2015 ONSC 1648, [2015] O.J. No. 1288, at paras. 29, 30 and 31, Master MacLeod discussed common interest privilege in this way:

29 When parties share privilege and there is subsequently a dispute between the parties that brings into question that very information, it is completely artificial to find that they cannot rely upon it against each other. See for example the decision of the Nova Scotia Supreme Court in Maritime Steel and Foundries Ltd. v. Whitman Benn & Associates Ltd.16 That was a decision relating to litigation privilege and while I recognize it was written at a time when litigation privilege was still regarded as a sub-species of solicitor-client privilege, the principle remains sound. In L’Abbé v. Allen-Vanguard Corp. I held that parties who have been permitted “inside the privilege tent” cannot subsequently assert privilege against each other over those documents to which they were all privy when litigation subsequently breaks out over those facts.

30 The joint or common privilege may continue to exist against the rest of the world but does not bar the parties who share the privilege from using the information against each other. This distinction is clearly demonstrated in a decision of this court, Re: Chiang 18. In that case, Mesbur J. held that where a lawyer acts for two parties having a common interest the communication is clearly privileged but “it is not privileged in a controversy between the two clients themselves”. She therefore permitted certain evidence to be used on the motion to remove the other party’s lawyer. On the other hand she refused to permit the trustee in bankruptcy to use that evidence – including lawyer’s bills - on a motion involving other parties because the joint privilege continued to exist and could not be unilaterally waived by one party alone.

31 This principle applies to both litigation privilege and solicitor-client privilege….

[25] The Defendants rely on the fact that the Plaintiffs were employees and not members of the Board of Directors and cite the decision in Van Der Wolf v. Allen, 2008 BCSC 1054; 170 A.C.W.S. (3d) 718, at paras 8-9. While it is true that a corporate entity, in that case, was found not to share common interest privilege with its employees, the court concluded that “the defendant did not have any personal involvement in the matter under discussion, nor is there any evidence he had a reasonable belief that the legal advice was being offered to him in any other form than as a functionary of the Village.”

[26] The Court went on to say that “[t]hose having a common interest in the solicitor-client communications include those jointly retaining counsel, but this common interest can extend to others who might have a reasonable belief that the solicitor was also offering advice to them notwithstanding the actual retainer was between the solicitor and the other party.”

[27] The majority of the documents in issue involve communications with Ms. Tina Fraser, counsel who was contacted through Pro Bono Law Ontario. It is apparent that CBCN has concluded that Ms. Fraser was their counsel, however, in my view the situation is very far from clear. The evidence discloses that CBCN had also retained Colleen Dunlop of the Emond Harnden firm at or about the material times in issue. No affidavit evidence from CBCN was filed.

The Linda Diaz Issue

[28] Linda Diaz (sometimes referred to as Linda Dias) was a CBCN Board member. In 2010, Ms. Dias made several accusations regarding the lack of diversity and made allegations that she was treated in a discriminatory manner by the CBCN Board named employees, including both Manthorne and Forrest. Those allegations are referred to in the Statement of Claim.

[29] It is not disputed that Forrest was asked by the President of CBCN, Cathy Ammendolea, to contact Pro Bono Law Ontario to seek the assistance of a lawyer to get advice on how to deal with the issues raised by Ms. Diaz. Trina Fraser was assigned as pro bono counsel. Forrest was listed as the designated contact for Ms. Fraser at CBCN. Forrest offered to change that contact to Ms. Ammendolea, but Ms. Ammendolea declined and asked Forrest to remain the designated contact for Ms. Fraser. As a result, Forrest was the recipient of much of the communication from Ms. Fraser and Forrest reported that advice to the CBCN Board.

[30] Both Plaintiffs stated in their examinations for discovery that they did not personally retain Ms. Fraser but this is not necessary for them to claim joint or common interest privilege. Unlike the situation in Van Der Wolf, both Plaintiffs had a personal involvement in the discrimination complaint by Ms. Diaz. Both Plaintiffs have sworn affidavits that they viewed the advice from Ms. Fraser as advice to them personally, as well as to the CBCN Board. The Plaintiffs relied on that advice in their conduct.

[31] Manthorne and Forrest add that they were actively involved with assisting the CBCN Board to resolve the issues arising from the accusations of Ms. Dias. Neither Manthorne nor Forrest was ever told by anyone at CBCN that they should not be communicating with Ms. Fraser.

[32] Their claim of assisting the Board is apparent from the first document over which the Defendants seek a declaration of solicitor-client privilege (Tab 2 – EH00044). It is an e-mail from Ms. Fraser to Cathy Ammendolea dated December 1, 2010. The Subject is Linda Diaz. It commences with these words: “Mona (Forrest) forwarded me Linda’s e-mail and I have reviewed it.” Ms. Fraser goes on to suggest that the CBCN responded to Ms. Diaz’ complaint by stating that “all involved individuals acted appropriately at all times.” As will be seen, Ms. Fraser continues to provide advice to the Plaintiffs on other issues and this further reinforces their belief that she was acting for them personally as well.

[33] I conclude that there was a common interest privilege in all communications from Ms. Fraser on issues involving Ms. Diaz. The disputed documents appear at Tab 2 – EH00044/1, Tab 3 - EH00046/1, and Tab 4 – EH00047/2. The Plaintiffs were correct in their position that they were not required to return them.

[34] The Plaintiffs continued to receive legal advice from Ms. Fraser beyond the Linda Diaz issue and in circumstances where Ms. Fraser acknowledges that there may be an internal conflict of interest on her part.

[35] At or about the same time as the Diaz issue, a second issue arose between the Plaintiffs and the Board of Directors of CBCN with respect to a donation from a donor, Sanofi-Aventis. Each of the Plaintiffs sought advice from Ms. Fraser regarding the behaviour of the Board, as well as their personal obligations and potential liability. Manthorne and Forrest asked Ms. Fraser similar questions about a separate bank account and they both received the same advice from her.

[36] Mona Forrest was in contact with Ms. Fraser with regard to this issue on January 18. She had previously sought advice from the CBCN’s auditor. In her email, Ms. Fraser discusses the issue with Ms. Forrest, offers legal advice and says this in her response: “I consider myself to be counsel to the organization itself (not any particular individual(s)), and I am very concerned about how things are unfolding.” (emphasis mine) She concludes her e-mail by stating:

I am fine with you sharing my concerns (and or this email) with anyone else at the CBCN (Directors, executive, etc.) and I am happy to participate in a Board meeting of support like further input.

[37] It is apparent that Ms. Fraser has also shared this concern with a Board member and she further invites Ms. Forrest to share her concerns with the Board. An email from Board member, Diana Ermel, dated January 23, 2011, includes an email which has been forwarded to her by Ms. Forrest.

[38] Ms. Manthorne sends Tina Fraser another email on January 19 seeking legal advice and asking if the funder should be contacted. Ms. Fraser responds to her the same day as follows:

I spoke with Cathy this morning. I think that should be discussed and agreed upon at the board level. I understand that Cathy will be convening a Board meeting. Hopefully the board will be able to resolve this issue once and for all and contact will be unnecessary.

[39] On February 3, 2011, Jackie Manthorne sent Tina Fraser an e-mail forwarding an e-mail from Cathy Ammendolea that indicates that the Sanofi-Aventis donation will be allocated to a Governance Fund. Manthorne raises questions about the appropriateness of that action. Tina Fraser responds on February 4 and notes: “I’ve indicated before, I am in a very difficult position here given the internal conflict.” (emphasis mine) She goes on to give Ms. Manthorne specific advice.

[40] All of this advice is being shared. It is clear that Ms. Fraser considers herself counsel to the CBCN organization as a whole and not just to the Board of Directors. She has obviously included members of the executive within the scope of solicitor-client relationship as she openly shares her advice and concerns with both groups.

[41] Accordingly, all communications referencing any advice received from Ms. Fraser on the issue of the Sanofi-Aventis donation are subject to common interest privilege. These are the documents at Tab 5 – CBCN01463, Tab 7 – CBCN015487, Tab 8 – CBCN016742, Tab 9 - CBCN018216, CBCN010666, CBCN001149, CBCN010669 and CBCN010679, Tab 10 – JM00062, Tab 11 – JM000063, Tab 12 – JM000067, Tab 13 –JM000068, and Tab 14 – JM000070 of the Book of Disputed Documents.

The Remaining Documents:

[42] Tab 1 CBCNO14239 – No privilege attached to this document. This contains an expression of an opinion by a BLG lawyer about the nature of the dispute and is not legal advice.

[43] Tab 6 CBCN017802 – Draft Board Minutes – Page 5. This appears to be legal advice received from Ms. Dunlop, there should be a further redaction to the area already redacted. This is identified with a handwritten notation “new redaction” on my copy of the document.

[44] The remaining documents were in the Plaintiffs’ possession before they retained NOP as counsel and were disclosed in Schedule “A” of their Affidavits of Documents.

[45] Documents JM000062, JM000063, JM00067: The Defendants claim solicitor-client privilege over the part of the documents containing an email from Trina Fraser. As noted above these are all covered by common interest privilege.

[46] Document JM00070 – This is not a communication to or from a lawyer for the purpose of seeking legal advice. In her affidavit, Jackie Manthorne states that she had discussed the issue of the separate bank account with the then CBCN treasurer Diane Hartling. To the extent that there is any discussion of legal advice from Trina Fraser, this is covered by common interest privilege. To the extent that there is any other form of privilege attaching to those communications, that privilege was waived by Board member Diane Hartling.

[47] Document JM00085 - The letter to the Public Guardian and Trustee from Mona Forrest is not a communication to or from a lawyer or communication for the purpose of seeking legal advice. It is a letter of complaint. To the extent that it includes emails from Ms. Fraser, as already indicated, these are covered by common interest privilege.

[48] Document JM000125 - This is not a communication to or from a lawyer for the purpose of seeking legal advice. Ms. Manthorne’s affidavit discloses that she was provided a copy of that document by Ms. Hartling; to the extent that there is any privilege, it has been waived.

[49] JM000167 - These are draft minutes of a CBCN Board of Directors meeting of May 10, 2011. There is no solicitor-client or litigation privilege. There is no legal advice provided or discussed. Moreover, any privilege that may have attached to those documents was waived since a CBCN Board member, Alwyn Anderson provided Ms. Manthorne with a copy.

[50] JM000222 - No privilege attaches to these communications as the Defendants were required to produce the policy of insurance in issue.

[51] JM000238 and JM000249 - No privilege attaches to these documents and to the extent that any might exist, any privilege is waived as these were produced to the Plaintiffs by a CBCN Board Member, Alwyn Anderson.

[52] In summary, the most contentious documents in issue are communications to and from Trina Fraser, and I have concluded that these are all subject to common interest privilege. As for the remaining documents, they either did not contain legal advice nor were they created for the dominant purpose of the litigation and are therefore, not subject to any form of privilege. In any case, where any such privilege might have existed, it was waived by the production of these documents to the Plaintiffs by Board members.

Should NOP be removed as Solicitors of Record?

[53] The Defendants take the position that even if I conclude that none of the documents are privileged, NOP should be removed as Solicitors of Record since the case law requires counsel for the opposing side to bring a motion to determine the issue of privilege. They cite Belobaba, J. in Chan v. Dynasty Executive Suites Ltd, 2006 CanLII 23950 (ONSC) who summarized the course of conduct required of a lawyer upon notice that the opposing party has inadvertently produced privileged documents:

The case law on this point is clear. Once a lawyer has been advised that privileged documents were produced inadvertently, the lawyer must promptly return the material uncopied and, if possible, unread. If there is any issue as to whether privilege is properly asserted, the obligation of the receiving counsel is to seal the documents, and any notes made in respect of the documents, and seek further direction from the court.

[54] In those cases cited by the Defendants[^5], counsel have only been disqualified where the documents in question were found to have been privileged and prejudicial to the party asserting the claim of privilege. That is not the case here. In Celanese Canada Inc. v. Murray Demolition Corp, 2006 SCC 36, the Supreme Court set out six factors to consider when assessing whether disqualification of counsel is appropriate in these circumstances:

i. How documents came into the possession of the opposing counsel;

ii. What opposing counsel and client did upon recognition that documents are potentially subject to privilege;

iii. Opposing counsel should return inadvertently disclosed privileged materials and advise the extent to which materials were reviewed;

iv. The contents of the solicitor-client communications and the degree to which they are prejudicial;

v. The stage of litigation;

vi. The potential effectiveness of a firewall or other precautionary steps.

[55] I have found only one short unredacted portion of one document that could contain legal advice from Colleen Dunlop. That advice addresses governance issues which are at the core of this litigation. Whether or not the Defendants will be able to continue to assert a claim of privilege over that advice remains to be seen. There is no evidence that the Plaintiffs have attempted to use this information to the prejudice of the Defendants. The only information used by the Defendants relates to communications from Ms. Fraser and I have concluded that these are covered by common interest privilege. NOP has acted as counsel to the Plaintiffs for nearly four years. To remove them as Solicitors of Record at this late stage is grossly disproportionate to the harm done by the inadvertent disclosure of part of one document. Any potential harm can be addressed by prohibiting the Plaintiffs from using this information at discovery or at trial. If the Defendants were forced to bring this motion to have the privilege issues decided, that is a matter for costs.

[56] Accordingly, the Defendants’ motion is substantially dismissed. The Plaintiffs may make brief submissions as to costs within 20 days of the release of this decision. The Defendants have a further 15 days to reply.

Mr. Justice Robert N. Beaudoin

Released: June 15, 2015

[^1]: The Law of Privilege in Canada, Vol.2 Robert W. Hubbard, Magotiaux, s. and Duncan, S.M. (Toronto: Canada Law Book) at 11:20 [^2]: R. v. Youvarajah, 2011 ONCA 654; 107 O.R. (3d) 401, at para 146 [^3]: Chiang, Re, 2013 ONSC 6753, 234 A.C.W.S. (3d) 79, at para. 16: Mason & Silver, Solicitor-Client Privilege in Canadian Law (Toronto: Butterworths Canada Ltd, 1993) at 64: [^4]: Sopinka et al, The Law of Evidence in Canada, 2d ed (Toronto: Butterworths Canada Lt, 1999) at p. 14.46: [^5]: White v. 123627 Canada Inc., 2014 ONSC 2682; [2014] O.J. No. 2494.