COURT FILE NO.: 16-71113 DATE: 2018/12/20 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: MAYA DICKSON, MICHELE MARIANI, by his Litigation Guardian, CARMINE MARIANI, and CARMINE MARIANI, Plaintiffs AND MARK B. KELLETT and BRENDA TRUE, Defendants
BEFORE: Justice S. Corthorn
COUNSEL: Howard Yegendorf, for the Plaintiffs Pasquale Peloso, for the Defendants
HEARD: In writing
amended ENDORSEMENT
The text of the original endorsement was corrected on December 20, 2018 and the description of those corrections are appended.
corthorn j.
Introduction
[1] The significance of the open court principle is reflected in the following passage from the Supreme Court of Canada decision in Vancouver Sun (Re), 2004 SCC 43, [2004] 2 S.C.R. 332, at para. 25:
Public access to the courts guarantees the integrity of judicial processes by demonstrating “that justice is administered in a non-arbitrary manner, according to the rule of law” . Openness is necessary to maintain the independence and impartiality of courts. It is integral to public confidence in the justice system and the public’s understanding of the administration of justice. Moreover, openness is a principal component of the legitimacy of the judicial process and why the parties and the public at large abide by the decisions of courts. [Citation omitted.]
[2] This endorsement addresses the importance of the open court principle in the context of motions or applications for approval of settlements reached by, or on behalf of, minors or persons under a disability.
[3] On motions or applications of this kind, the relief requested frequently includes one or both of (a) an order dispensing with the requirement for service of the relevant materials on the opposing party, and (b) a sealing order. More often than not, the grounds relied upon either do not address the relief requested, or do so minimally. The supporting evidence, if any at all, is typically limited to a bare bones statement that the record includes information that is subject to a claim of privilege.
[4] This endorsement is not intended to reflect specifically on counsel for the parties to this action. Rather, it is the frequency with which requests for relief of this kind are made, and the persistent failure of counsel for the parties (both moving and responding) to fully consider the relevant issues that leads me to write this endorsement. Counsel, both plaintiffs and defence, need reminding of the criteria to be met before relief will be granted that in any way encroaches on the open court principle.
Background
[5] Michele Mariani was 12 years old when, in January 2015, he was injured in a two-car collision. He was a front-seat passenger in a car driven by his mother Maya Dickson. Ms. Dickson was also injured in the collision. Ms. Dickson, Michele, and Michele’s father are the plaintiffs in the action.
[6] The defendants are the owner and driver of the other car involved in the collision. The defendants’ car crossed the centre line of the road and collided with the car driven by Ms. Dickson.
[7] The plaintiffs’ claims against the defendants were settled. The settlement of Michele’s personal injury and Family Law Act claims (the latter based on Ms. Dickson’s injuries) has been approved (R.S.O. 1990, c. F.3). The approval was addressed by way of a handwritten endorsement released separately in the matter.
[8] On the settlement approval motion, the plaintiffs requested ancillary relief in the form of an order dispensing with the requirement for service of the relevant materials on the opposing party.
[9] The sole ground identified in support of the relief requested is that the supporting affidavits include information that is subject to one or the other of solicitor-client privilege and “litigation-settlement” privilege. The plaintiffs do not define what is meant by the latter form of privilege. The only example provided of privileged information, of any kind, is found in the affidavit of plaintiffs’ counsel. In his affidavit, plaintiffs’ counsel addresses the strengths and weaknesses of Michele’s claims.
[10] The motion originally included a request for approval of the proposed solicitor-client account. That request was abandoned because (a) Michele is not making any contribution to the payment of the account, and (b) the account does not otherwise require approval. In support of the request for an order dispensing with the requirement for service, the plaintiffs submit that the evidence filed with respect to the proposed account is subject to a claim of privilege.
The Issue
[11] The sole issue to be determined is whether the plaintiffs are entitled to an order dispensing with the requirement for service of the relevant materials on the defendants. The analysis below addresses both requests for an order dispensing with service and requests for a sealing order.
Analysis
a) The Law
i) Service of Documents
[12] A notice of motion must be served on an opposing party and on any other person who will be affected by the order, unless there is an exception provided in the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 37.07(1). Service is not required where circumstances make it impracticable or unnecessary (r. 37.07(2)), or where the delay encountered for service to be effected may result in serious consequences (r. 37.07(3)).
[13] The Rules of Civil Procedure do not otherwise include an exception to the requirement for service that in any way encroaches on the open court principle. The importance of the principle in the context of motions is recognized in r. 37.07(5). That sub-rule deals with situations in which the presiding judge determines that “the notice of motion ought to have been served on a person who has not been served.”
[14] Pursuant to r. 37.07(5), the presiding judge is given the discretion to dismiss the motion (in its entirety, or only as against the person who has not been served); adjourn the motion and order that the notice of motion be served on the person not yet served; or require that any order made on the motion be served on the person not served with the motion materials.
ii) Sealing Order
[15] Section 137(2) of the Courts of Justice Act provides the statutory authority for the court to grant a sealing order (R.S.O. 1990, c. C.43, (the “CJA”)). Pursuant to that section, “[a] court may order that any document filed in a civil proceeding before it be treated as confidential, sealed and not form part of the public record.” The CJA does not set out criteria to be met for a sealing or confidentiality order to be made.
[16] In Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41, [2002] 2 S.C.R. 522, the Supreme Court of Canada set out the criteria to be met for a confidentiality or sealing order to be made. At paragraph 53 of the decision, the Supreme Court concluded that a confidentiality or sealing order should only be granted when:
(a) such an order is necessary in order to prevent a serious risk to an important interest, including a commercial interest, in the context of litigation because reasonably alternative measures will not prevent the risk; and
(b) the salutary effects of the confidentiality order, including the effects on the right of civil litigants to a fair trial, outweigh its deleterious effects, including the effects on the right to free expression, which in this context includes the public interest in open and accessible court proceedings.
[17] The Sierra Club criteria have been discussed in a number of cases in which a request was made pursuant to s. 137(2) of the CJA for one or both of a sealing order and confidentiality order. In Foss v. Foss, 2013 ONSC 1345, 46 C.P.C. (7th) 415, Perell J. considered requests for both types of orders in the context of an application with respect to guardianship of person and property. There was little dispute between the parties that a sealing order was appropriate in the circumstances.
[18] In granting the sealing order, however, Perell J. made the scope of the order abundantly clear by adding a term that “the sealing of the court file is without prejudice to the rights and obligations of the parties to the material filed in the proceeding” (at para. 5). Later, in addressing the request for a confidentiality order, Perell J. said, “[t]here is nothing in Sierra Club, supra that suggests that a sealing order should apply to the parties to litigation and prevent them from seeing their opponent’s documents.” (Foss, at para. 41.)
[19] As another example, D.M. Brown J. (as he then was) considered a request for a sealing order on an application by trustees to pass accounts (D.B. Trust (Trustees of) v. J.B. (Litigation Guardian of) (2009), 97 O.R. (3d) 544 (S.C.J.)). The beneficiaries of the trust were the sons of a man who was killed in the September 11, 2001, attack on the World Trade Center.
[20] The trustees requested a confidentiality order with respect to the initial and all future passing of accounts. They made the request to protect the two boys from publicity and other harm that might arise because of the notoriety of the events of September 11, 2001. After reviewing s. 137(2) of the CJA and the decision in Sierra Club, D.M. Brown J. considered other types of applications or motions involving the financial interest of minors:
They include the approval of settlements relating to motor vehicle accidents, the appointments of guardians of property for minors, as well as applications to pass accounts as in the present case. No statutory rule requires that court proceedings involving minors be subject to confidentiality or sealing orders. On the contrary, in practice most such proceedings are not. (D.B., at para. 12.)
[21] D.M. Brown J. ultimately concluded that it was reasonable to rely on an alternative measure. The title of proceeding was modified to allow the use of initials in place of the full names of the individuals involved. A sealing order was not granted.
[22] The decisions in Foss and D.B. Trust demonstrate the reluctance of the court to depart from the open court principle.
b) The Plaintiffs’ Position
[23] The plaintiffs highlight the importance of r. 7.08 in prescribing the procedure by which the court scrutinizes settlements reached of claims by or against a minor or a person under disability. The plaintiffs submit that the court would run afoul of the intended purpose of r. 7.08 if the moving party is required to disclose the frailties of their case to the responding party.
[24] In the discussion that follows, I refer to motions for approval of a settlement. Court approval of a settlement may be obtained on application (r. 7.08(3)). Applications are made far less frequently than are motions for approval of a settlement. In any event, there are differences between the procedure for a motion for settlement approval and an application for settlement approval: see Leonard v. Saint-Vincent Hospital, 2018 ONSC 370, [2018] O.J. No. 308.
c) Discussion
[25] The plaintiffs’ position overlooks the case law with respect to the type of evidence required in support of a settlement approval motion. For example, at paragraphs 23 and 24 of her decision in Rivera v. Leblond (2007), 44 C.P.C. (6th) 180 (Ont. S.C.), Thorburn J. discussed the type of evidence required:
Rule 7.08(4) and the obligations of the court pursuant to its parens patriae jurisdiction require a party seeking approval to submit sufficient evidence to make a meaningful assessment of the reasonability of the proposed settlement of the claims of a person under a disability.
This is a serious and substantial requirement which cannot be satisfied by the provision of conclusory statements. It requires full disclosure of evidence regarding the material issues. Where there is a conflict in the evidence the conflicting evidence must be disclosed to the court. [Emphasis added.]
[26] The evidence required depends, in part, on the facts of the case. Typically, the moving party must provide sufficient evidence to demonstrate that:
a) An appropriate investigation with respect to both liability and damages has been completed;
b) An appropriate assessment of liability issues has been made;
c) An appropriate assessment of damages issues has been made; and
d) The fees and disbursements which the plaintiff’s lawyers propose to charge are reasonable in all the circumstances (Rivera, at paras. 26-28).
[27] Having described the nature and extent of the evidence required on a settlement approval motion, Thorburn J. was careful to point out that, on such a motion, the court is not required to consider the matter as if it were a full trial of the material issues. The court “should be sensitive to the costs of additional proceedings or imposing onerous obligations on the parties, provided sufficient evidence has been submitted to enable the court to make the required assessment.” (Rivera, at para. 25).
[28] The type of evidence required in support of a r. 7.08 motion was also discussed by Pierce J. in Burns Estate v. Falloon, [2007] O.J. No. 3541 (S.C.). In that case, the plaintiffs sought an order dispensing with the requirement for service of the motion record on the defendant. In addition, the plaintiffs requested that the unedited court copy of the affidavits be sealed. In the alternative, the plaintiffs requested an order permitting them to redact from the supporting affidavits the evidence of their counsel regarding opinions expressed to the clients.
[29] Pierce J. approached the relief requested from the perspective of the public and the importance of:
a) The process of settlement approval motions being as transparent as the proceeding itself (at para. 15); and
b) An open and transparent justice system and the public interest in knowing that the court supervises settlements reached on behalf of minors and persons under a disability (at para. 23).
[30] At paragraphs 18 and 19 of her decision, Pierce J. concluded that there is no privilege in a communication to the court mandated by law regarding an infant settlement:
… The policy of the protection of the interests of children and other persons under disability requires full and frank disclosure of the merits of a settlement. Necessarily this calls for a candid opinion by counsel. As well, the litigation guardian must understand the reasons for settlement and accept them.
The court relies on counsel to adequately describe an infant settlement. It may refuse to approve a settlement because of insufficient evidence. While local practice has developed such that defence counsel is not usually concerned with the particulars of the infant settlement, nonetheless the clear wording of the rule requires service of the entire motion record on opposing counsel.
[31] Pierce J. recognized that a motion for approval of a settlement reached on behalf of a minor or a party under a disability is a “unique incursion on solicitor-client privilege” (at para. 20). She noted that the interference in that privilege is circumscribed and occurs when the case has already been settled; it does not form part of the discovery process or interfere with the prosecution or defence of the action. The request for an order dispensing with service of a true copy of the documents on the defendant was denied (at para. 21).
[32] In describing the nature of the evidence filed in support of a motion for approval of a settlement, Melnick J., of the British Columbia Supreme Court, said:
What [counsel for the moving party] does is provide assurance to the court that he has taken the steps that would be expected of competent counsel to get the best result possible for his client. The court should expect nothing less on such applications, but nor should counsel expect that, where it is required that they demonstrate to the court that they have done their job, the court will thereafter clothe their work in secrecy. (Makowsky (Guardian ad litem of) v. Jaron, 2004 BCSC 2, 26 B.C.L.R. (4th) 297, at para. 4).
[33] It is incumbent upon counsel to craft the supporting materials in such a way that the evidentiary requirements are met without, unnecessarily, disclosing information that is subject to solicitor-client or litigation privilege: “If [counsel for the moving party goes] further than need be to convince the court … that is his problem” (Makowsky, at para. 4).
[34] A statement in counsel’s supporting affidavit that disclosure of the supporting materials would infringe on solicitor-client privilege is generally insufficient to support a sealing order being made. For example, in St. Jean v. Armstrong, 2015 ONSC 13, [2015] O.J. No. 131, varied on other grounds 2017 ONCA 145, 136 O.R. (3d) 257, the only evidence in support of a request for a sealing order was counsel’s affidavit in which he stated that disclosure of the affidavit would infringe solicitor-client privilege. All of the information about the accident and treatment could be found in the public record, because that information was set out in the pleadings filed. Liability and damages were in dispute, but there was nothing extraordinary about the case (at paras. 62-65). Del Frate J. concluded that the Sierra Club criteria had not been met and the request for a sealing order was denied.
[35] In two recent decisions of this court, the interplay between r. 7.08 and s. 137(2) was considered. In both cases, the proposed settlement was reached at a time when a trial date was pending: see e.g., Lochner v. Callanan, 2015 ONSC 5598, [2015] O.J. No. 7298, at para. 39; Lochner v. Callanan, 2016 ONSC 591, [2016] O.J. No. 463 at paras. 13-14; and Ki Ho Kim v. 260 Wellesley Residences Inc., 2017 ONSC 2993, [2017] O.J. No. 2778 at para. 24.
[36] A theme common to the decisions in Lochner and Kim is the potential prejudice at trial to the moving party if the settlement is not approved and/or because the matter is proceeding in any event against a non-settling party. For example, in Lochner, Matheson J. concluded that it would be prejudicial to the plaintiffs if the evidence in the supporting materials on the motion came to the attention of the trial judge (2016 decision, at para. 9). In neither decision, however, is there a discussion of the Sierra Club criteria.
[37] Even without consideration of the Sierra Club criteria, impending litigation alone may not be sufficient to warrant a sealing order of some or all of the materials on an approval motion: see Rops v. Intact Insurance Company, 2013 ONSC 7366, [2013] O.J. No. 6266.
[38] In support of a request for a sealing order, counsel for the moving party in Rops simply stated that the materials were confidential in nature and should not form part of the public record. The settlement for which approval was sought was of an infant plaintiff’s claim for accident benefits. The tort litigation was continuing.
[39] Leitch J. highlighted that s. 137(2) of the CJA places the onus on the moving party to satisfy the court that the contents of the file should be sealed from public view (at para. 36). Leitch J. focussed on the two-part test for a sealing order established by the Supreme Court of Canada in R. v. Mentuck, 2001 SCC 76, [2001] 3 S.C.R. 442 (“the Dagenais/Mentuck test”). In summary, the Dagenais/Mentuck test provides that a sealing order should only be made where, “it is necessary to prevent a serious risk to the proper administration of justice and where the salutary effects of the publication ban or sealing order outweigh the deleterious effects on the rights and interests of the parties and the public.” (Rops, at para. 37).
[40] In Rops, the request for a sealing order was denied because, as succinctly stated by Leitch J., “[t]here [was] simply no basis put forward in the application materials that would justify the sealing order requested” (at para. 39).
[41] In M.E.H. v. Williams, 2012 ONCA 35, 108 O.R. (3d) 321 at paras. 31-32, the Court of Appeal emphasized that to determine the outcome of a request for a sealing order, the court is required to engage in a two-part process. The first part focuses on whether there exists a serious risk to a public interest that can only be addressed by some form of a sealing or non-publication order. Only if the moving party establishes the existence of such a risk does the court move on to the second part of the process and determine how the competing interests are to be balanced.
d) Summary
[42] For the majority of settlement approval motions, counsel are in a position to provide the court with the requisite evidence without an unwarranted incursion into either solicitor-client or litigation privilege. The further along the proceeding has reached when the settlement is negotiated, the greater the amount of information available to the parties to assess their respective cases. That information comes from one or more of documentary, oral, and medical discovery, mediation, and a settlement conference. The issues in a case, and the relative strengths and weaknesses of each party’s case, are typically not a surprise to the parties and their respective counsel.
[43] Something more than the potential incursion into solicitor-client or some other form of privilege is required to support a request for an order dispensing with service of the relevant documents on the opposing party.
[44] The test for a sealing order is not easily met. If premised solely on the ground that the supporting materials include information that is subject to a claim of privilege, a request for a sealing order is unlikely to succeed.
[45] The satisfaction of the evidentiary requirements on a settlement approval motion—even if requiring some incursion into privileged information—is balanced against:
a) The obligations of the court in fulfilling its parens patriae jurisdiction;
b) The public interest in knowing that the court supervises settlements reached on behalf of minors and persons under a disability; and
c) Transparency in the proceeding, including the settlement approval process.
[46] In circumstances where a trial is pending, and the same or a related action is, in any event, proceeding against a non-settling party, the moving party may be able to secure a sealing order on the basis of potential prejudice with respect to the balance of the proceeding(s). In that circumstance, consideration should be given to whether a temporary sealing order is appropriate. A sealing order, if made, could terminate within a certain amount of time following final resolution of the balance of the proceeding(s) unless one or more of the parties or individuals affected by the sealing order subsequently moved to extend its duration or to make it permanent.
Disposition
[47] The evidence in support of the relief requested is insufficient; the plaintiffs’ request for an order dispensing with the requirement for service of the documents filed on the motion is dismissed. The plaintiffs shall serve on the defendants a complete copy of the motion record, supplementary motion record, and factum.
Madam Justice Sylvia Corthorn
Released: December 20, 2018
APPENDIX
December 20. 2018: At paragraph 4 in the final sentence “plaintiffs’” is changed to “plaintiffs” (i.e., the possessive apostrophe is removed;
December 20, 2018: At paragraph 7 in the final sentence I have changed the order of the final phrase to read “released separately in the matter.” It originally read “in the matter released separately.”; and
December 20, 2018: At paragraph 41, in the final sentence the word “existing” is replaced with “existence”.
COURT FILE NO.: 16-71113 DATE: 2018/12/20 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: MAYA DICKSON, MICHELE MARIANI, by his Litigation Guardian, CARMINE MARIANI, and CARMINE MARIANI, Plaintiffs AND MARK B. KELLETT and BRENDA TRUE, Defendants
BEFORE: Justice S. Corthorn
COUNSEL: Howard Yegendorf, for the Plaintiffs Pasquale Peloso, for the Defendants
HEARD: In writing
AMENDED endorsement Madam Justice Sylvia Corthorn
Released: December 20, 2018