Court File and Parties

COURT FILE NO.: 226/08 A1

DATE: 20211006

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Peter Armstrong and Shelley Martin, Plaintiffs

AND:

George Penny and Janet Penny, Defendants

AND:

Coachlamp Homes Inc., Matthews, Cameron, Heywood-Kerry T. Howe Surveying Ltd, c.o.b. as Coe, Fisher, Cameron, W.G. Jackett and Sons Construction Limited o/a Jackett Construction and City of Kawartha Lakes, Third Parties

BEFORE: Justice C. Boswell

COUNSEL: Liam Thompson for the Plaintiffs Jeffrey Lanctot for the Defendants Chris Hluchan for the Third Party, Coe, Fisher, Cameron Susanne Sviergula for the Third Party, Coachlamp Homes Inc. Natalie Kolos for the Third Party, City of Kawartha Lakes

HEARD: October 5, 2021 by Zoom videoconference

ENDORSEMENT

OVERVIEW

[1] The plaintiffs and defendants are neighbouring cottage owners on Sturgeon Lake, in the Kawartha Lakes region. The plaintiffs acquired their property in July 2002. They added a small parcel to the northern end of their property in March 2003. The defendants’ property abuts the southern end of the plaintiffs’ lands.

[2] At some point, not clear to me, the plaintiffs discovered that a garage built by the defendants encroaches onto the southern end of the plaintiffs’ lands. How much of an encroachment I do not know, but that is neither here nor there for the purposes of this motion.

[3] The plaintiffs commenced an action in July 2008 seeking damages of $2 million for trespass, nuisance and negligence. They also want an injunction requiring the defendants to tear down the offending structure.

[4] I am unable to say why this action has not yet been tried, more than 13 years after it was commenced. But again, that issue is neither here nor there for the purposes of this motion.

[5] What is in issue in this motion is a question of disclosure. The third parties, save Jackett Construction, move for an order compelling the plaintiff, Peter Armstrong, to disclose to them the contents of the files of their real estate lawyer in relation to the 2002 purchase of their cottage and the purchase of additional abutting lands in 2003.

[6] Mr. Armstrong does not want to produce his real estate lawyer’s files. He says they are privileged and, in the case of the 2003 purchase, irrelevant to the live issues in this case.

[7] The real estate lawyer in question is Brian Evans, a solicitor practicing in Lindsay.

[8] The request for Mr. Evans’ files was first made during Mr. Armstrong’s examination for discovery on January 16, 2014. Mr. Lanctot, counsel to the defendants, asked for a complete copy of Mr. Evan’s file “as it relates to these two transactions”. The plaintiffs were represented by Russell Wm. Palin at the time of the examinations. Mr. Palin said he would take the request for Mr. Evans’ files under advisement.

[9] Counsel communicated about undertakings and refusals for some time following the examinations for discovery. On April 16, 2014, Mr. Palin wrote to all counsel and advised as follows:

I have now had an opportunity to review solicitor Evans’ file as it relates to the Armstrong’s (sic) purchase of the subject property.

I seek your input with respect to how we may wish to proceed with respect to same.

The file is more than two (2) inches in thickness, and contains numerous documents.

The file cover itself has writing on both the interior and exterior.

There are additional interior file covers which also contain writing.

I would appreciate being advised if the parties wish for me to prepare an Amended Affidavit of Documents reflecting the documents contained in that file, or are the parties content to have the Plaintiffs simply list the file as one production, being solicitor Evans’ file?

Secondly, I am more than happy to allow anyone to attend my office to review the file, or alternatively do you wish for me to provide copies of the documents.

I appreciate that it is difficult to request copies of documents if I have not listed the documents.

Alternatively, I am prepared to photocopy all of the documents, and send them out if that is required.

[10] On April 23, 2014, Mr. Lanctot wrote, by email, to Mr. Palin and asked him to provide a photocopy of Mr. Evans’ file.

[11] For reasons unclear to me, the Evans’ file was never delivered to the defendants or any of the third parties.

[12] Mr. Palin has retired from the practice of law. He was succeeded by the plaintiffs’ current counsel in March 2020. Current counsel object to producing Mr. Evans’ file(s).

THE PARTIES’ POSITIONS

[13] The submissions of the third parties were made principally by Mr. Hluchan. He submitted that the Evans’ files are relevant for several reasons which include the following:

(a) They should demonstrate what lands the plaintiffs understood they were purchasing;

(b) They should provide evidence of the time by which the plaintiffs became aware of the encroachment; and,

(c) They may disclose one or more things that Mr. Armstrong could have done differently to discover the encroachment.

[14] Mr. Hluchan went on to submit that Mr. Palin’s letter of April 16, 2014 is singularly significant for two reasons. First, because it unequivocally expresses a waiver to any arguable claim to solicitor-client privilege in any of the documents contained in the Evans’ file(s). Second, because it constitutes an undertaking to produce the file(s). This second factor is, on its own, sufficient grounds for the court to order that the file(s) be produced.

[15] Mr. Hluchan contends that an order for production of the file(s) would not be disproportionate considering the amount at stake in the litigation, the probative value of the contents of the file(s) and the limited cost of production.

[16] Mr. Thompson made submissions on behalf of Mr. Armstrong. He advanced a broad assertion of solicitor-client privilege over Mr. Evans’ files.

[17] Mr. Thompson pointed out that Mr. Palin’s letter of April 16, 2014 is not clear about what files he had reviewed. It appears that he may have only reviewed the file in relation to the original land purchase in 2002. He submits that the court should interpret the letter as referring only to that file, meaning that Mr. Palin made no offer to produce any file relating to the 2003 purchase that added onto the northern end of the plaintiffs’ cottage property.

[18] He went on to make slightly different submissions in relation to the two files.

[19] He submitted that the 2003 purchase file should not be ordered disclosed for two reasons. First, because it is subject to solicitor-client privilege. Second, because it is not relevant to the live issues in the litigation, given that it involves the purchase by the plaintiffs of a small parcel of land at the northern end of their property. The encroachment in issue is over the southern end of their property.

[20] With respect to the 2002 purchase file, he disagreed with Mr. Hluchan’s interpretation of Mr. Palin’s April 16, 2014 letter. He says that there was never any intention evinced to waive privilege in the file. Moreover, there is no basis here to find an implied waiver based on any of the conduct of the plaintiffs or their counsel.

THE GOVERNING PRINCIPLES

Disclosure is Driven by Relevance

[21] Civil proceedings in Ontario are governed by the Rules of Civil Procedure. The Rules encourage more, rather than less, disclosure.

[22] 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.”

[23] Relevance does not, of course, exist in the abstract. It is about the relationship that an item of evidence has to one or more of the live issues in the case, as identified by the pleadings.

[24] Relevance is not a significant threshold. To be relevant, a document, or a question posed on examination for discovery, must, as a matter of logic and human experience, make the existence of a fact in issue more or less likely. See R. v. Cloutier, 1979 CanLII 25 (SCC), [1979] 2 S.C.R. 709.

Undertakings Must be Honoured

[25] An undertaking is in the nature of a promise. When an undertaking is given, the party is obliged to provide the answer. See r. 31.07(4) of the Rules of Civil Procedure. See also s. 5.1-6 of the Law Society of Ontario’s Rules of Professional Conduct, which provides as follows:

A lawyer must strictly and scrupulously fulfill any undertakings given by him or her and honour any trust conditions accepted in the course of litigation.

Solicitor-Client Privilege

[26] Solicitor-client privilege is a class privilege. It protects the confidential relationship between a solicitor and his or her client. It is a right of fundamental importance in Canadian law. See Solosky v. The Queen, 1979 CanLII 9 (SCC), [1980] 1 S.C.R. 821; Geffen v. Goodman Estate, 1991 CanLII 69 (SCC), [1991] 2 S.C.R. 353 ; Smith v. Jones, 1999 CanLII 674 (SCC), [1999] 1 S.C.R. 455 , and R. v. Fink, 2002 SCC 61.

[27] The conditions necessary to establish the privilege are well settled. They were identified in the seminal case of Solosky v. The Queen, as above. There are three. The communication over which privilege is asserted must:

(a) be a communication between lawyer and client;

(b) which entails the seeking or giving of legal advice; and,

(c) which is intended to be confidential by the parties.

See also Pritchard v. Ontario (Human Rights Commission), 2004 SCC 31, [2004] 1 S.C.R. 809 at para. 15.

[28] The party asserting privilege bears the onus to establish an evidentiary basis for it. See General Accident Assurance Co. v. Chrusz (1999), 1999 CanLII 7320 (ON CA), 45 O.R. (3d) 321, [1999] O.J. No. 3291 (C.A.) at para. 95.

[29] Solicitor-client privilege may be waived.

[30] Solicitor-client privilege belongs to the client and can only be waived by the client or through his or her informed consent: R. v. Fink, as above, at para. 39 and R. v. McClure, 2001 SCC 14.

[31] Waiver may be express or, where fairness requires it, implied. The Court of Appeal explained the distinction in R. v. Youvarajah, 2011 ONCA 654 at paras. 146-147:

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: S & K Processors Ltd. v. Campbell Ave. Herring Producers Ltd., 1983 CanLII 407 (BC SC), [1983] B.C.J. No. 1499 , [1983] 4 W.W.R. 762 (S.C.), per McLachlin J.

Despite these requirements, an implied waiver of solicitor-client privilege may occur where fairness requires it and where some form of voluntary conduct by the privilege holder supports a finding of an implied or objective intention to waive it…

[32] Implied waiver arises, in other words, where the holder of the privilege takes some action or position inconsistent with the maintenance of the privilege. See Huang v. Silvercorp Metals Inc., 2017 BCSC 795 at para. 92. One example of implied waiver, offered by the Court of Appeal in Youvarajah, is where a client alleges a breach of duty by his or her counsel. Another, offered by McLachlin J., as she then was, in S & K Processors, as above, is where a party relies on legal advice to justify or explain its conduct. Moreover, disclosure of a portion of an otherwise privileged communication may sometimes, as a matter of fairness, require that the whole of the communication be disclosed. See for instance, Howard v. London (City), 2015 ONSC 3698.

DISCUSSION

[33] A number of the legal concepts engaged in the parties’ arguments on this motion are complex. This brief endorsement does not do justice to that complexity. Having said that, the bases on which this motion may be disposed of are quite straightforward.

[34] The plaintiffs assert solicitor-client privilege over Mr. Evans’ file(s) in relation to the two purchase transactions he worked on for the plaintiffs when they acquired their cottage. The plaintiffs bear the onus to establish that the contents of the file(s) are subject to a sustainable claim of privilege.

[35] The plaintiffs did not file any response to the third parties’ motion – no affidavit evidence and no factum.

[36] Solicitor-client privilege does not exist in a “file”. It exists in specific communications – oral or documentary - that meet the three conditions required by the common law. The plaintiffs have failed to identify a single document or oral communication that might be subject to privilege and they have failed to establish an evidentiary basis for any such privilege. On this basis alone the plaintiffs cannot succeed on this motion.

[37] But there is more.

[38] Mr. Palin took under advisement the request for production of Mr. Evans’ files. He took steps to review what he called “the purchase file”. He made the determination, after that review, that the file would be produced. His April 16, 2014 letter, properly construed, provides the answer to Mr. Lanctot’s request for production. And the answer was yes. Implicit in that answer was a waiver of any claim to privilege or any assertion that the contents of the file were not relevant.

[39] In my view, the plaintiffs cannot now refuse what Mr. Palin undertook, on their behalf, to disclose. There is no evidence before the court that Mr. Palin acted without instructions or that he misspoke in his letter.

[40] I come now to the assertion that Mr. Palin referenced only one of two files in issue. Mr. Thompson argued that Mr. Palin’s April 16, 2014 letter should be interpreted to refer only to the file in relation the 2002 purchase. I disagree. Mr. Palin was well aware that the request was for the file(s) relating to both the 2002 and 2003 transactions. His letter does not distinguish between those transactions in any way. In other words, he does not express the position that one file will be disclosed and the other will not. He also makes reference to more than one subfile within a larger file folder.

[41] There is no evidence that there are two distinct files. The plaintiffs’ counsel is, I understand, in possession of the file or files. It is within their knowledge whether there is more than one file, or whether both the 2002 and 2003 transactions are contained within one file. They have not seen fit to share that information with the opposing parties or the court. In other words, they have not tendered any evidence that might rebut the conclusion that Mr. Palin was referencing whatever file(s) there were in relation to Mr. Evans’ work on the plaintiffs’ behalf in connection with their purchases in both 2002 and 2003.

[42] In all the circumstances, I interpret Mr. Palin’s letter to refer to all of Mr. Evans’ records in relation to the 2002 and the 2003 transactions, whether they are situated in one or more files. I find that he undertook to produce those files. In doing so, he acknowledged their relevance and discoverability.

[43] The third parties’ motion is therefore granted. Mr. Evans’ file(s) in relation to the 2002 and 2003 purchase transactions is/are to be produced within 30 days.

[44] Costs are fixed at $4,000 and are payable by Mr. Armstrong to Coe, Fisher, Cameron within 30 days.

C. Boswell J.

Date: October 6, 2021