Court File and Parties

Court File No.: CV-21-00655418-00CL
Date: 2025-02-26
Court: Superior Court of Justice - Ontario

Plaintiffs:
Sakab Saudi Holding Company, Alpha Star Aviation Services Company, Enma Al Ared Real Estate Investment and Development Company, Kafa'at Business Solutions Company, Security Control Company, Armour Security Industrial Manufacturing Company, Saudi Technology & Security Comprehensive Control Company, Technology Control Company, New Dawn Contracting Company, and Sky Prime Investment Company

Defendants:
Saad Khalid S Al Jabri, Dreams International Advisory Services Ltd., 1147848 B.C. Ltd., New East (US) Inc., New East 804 805 LLC, New East Back Bay LLC, New East DC LLC, Jaalik Contracting Ltd., Nadyah Sulaiman A Al Jabbari (personally and as litigation guardian for Sulaiman Saad Khalid Al Jabri), Khalid Saad Khalid Al Jabri, Mohammed Saad Kh Al Jabri, Naif Saad Kh Al Jabri, Hissah Saad Kh Al Jabri, Saleh Saad Khalid Al Jabri, Canadian Growth Investments Limited, Gryphon Secure Inc., Infosec Global Inc., QFive Global Investment Inc., Golden Valley Management Ltd., New South East Pte Ltd., Ten Leaves Management Ltd., 2767143 Ontario Inc., Nagy Moustafa, HSBC Trustee (C.I.) Limited (in its capacity as Trustee of the Black Stallion Trust), HSBC Private Banking Nominee 3 (Jersey) Limited (in its capacity as a Nominee Shareholder of Black Stallion Investments Limited), Black Stallion Investments Limited, New East Family Foundation, New East International Limited, New South East Establishment, NCOM Inc., and 2701644 Ontario Inc.

Before: Mark L. Cavanagh

Counsel:

• For the Plaintiffs: Munaf Mohammed K.C., Jonathan Bell, Ian Thompson
• For Saad Aljabri, 1147848 B.C. Ltd., Nadyah Sulaiman A Al Jabbari (personally and as litigation guardian for Sulaiman Saad Khalid Al Jabri, Khalid Saad Khalid Al Jabri, Naif Saad Kh Al Jabri, Sulaiman Saad Khalid Al Jabri, Hissah Saad Kh Al Jabri, Saleh Saad Khalid Al Jabri, and 2701644 Ontario Inc.): Sean Pierce
• For Mohammed Saad Kh Al Jabri, New East (US) Inc., New East 804 805 LLC, New East Back Bay LLC, New East DC LLC, Golden Valley Management Ltd., Ten Leaves Management Ltd., New East International Limited, and New East Family Foundation: Hailey Bruckner, Greta Hoaken
• For Dreams International Advisory Services: Erin Chesney

Heard: 2024-12-06

Endorsement

Introduction

[1] On this motion, the plaintiffs seek:

(a) an order directing the defendants to provide a detailed Schedule “B” to their affidavits of documents listing the documents over which they claim privilege.

(b) production of approximately 4,000 documents listed on Schedule “B” to a list of documents from the files of Cadwalader, Wickersham & Taft LLP (“Cadwalader”) over which the defendants claim privilege (a total of 17,497 documents are so listed).

(c) answers to approximately 165 questions that were refused on the examinations for discovery of the defendants or their representatives on the ground of privilege (that are listed in Appendix “E” to the notice of motion). In Schedule “C” of their factum, the plaintiffs list the questions in respect of which they seek directions.

(d) determination of whether certain documents which were produced by the defendants in error and over which they claim privilege should be returned to the defendants because privilege was properly asserted.

(e) production of unredacted documents from Dreams, acting through its corporate director, HSBC PB Corporate Services 1 Limited (“HSBC”).

[2] In their notice of motion, the plaintiffs seek an order compelling the defendants to produce certain categories of non-privileged documents listed in Schedule “B” to the “Cadwalader” list of documents, or, in the alternative, an order requiring the defendants to produce to the Court for inspection exemplar documents to be agreed upon from certain categories of non-privileged documents listed in the Cadwalader Schedule B for the purpose of determining the validity of the claims of privilege.

[3] The motion was not argued with submissions with respect to each document or question in dispute.

[4] At the hearing, counsel for the plaintiffs asked for directions with respect to six questions that, it was submitted, would resolve the bulk of the refusals given during examinations for discovery. The six questions were addressed at the hearing and provided in writing by counsel for the plaintiffs in a letter dated December 9, 2024. The defendants do not accept that directions with respect to these six questions will be sufficient to address the issues that arise on this motion.

[5] I have addressed these questions in this endorsement.

Analysis

Legal Principles

[6] In General Accident Assurance Company et al. v. Chrusz et al. (1999), Carthy J.A., writing for the majority of the Court of Appeal, addressed the general principles that apply to litigation privilege. Carthy J.A. confirmed that the purpose underlying litigation privilege is related to the needs of the adversarial trial process and for a protected area to facilitate investigation and preparation of a case for trial by the adversarial advocate. Carthy J.A. confirmed, at para. 33, that the document over which litigation privilege is claimed must have been created for the dominant purpose of litigation, actual or contemplated.

In his dissenting reasons in Chrusz, Doherty J.A. addressed the principles that apply to solicitor–client privilege. In his reasons, at para. 95, Doherty J.A. explained how the adjudication of claims to solicitor-client privilege should be made:

The adjudication of claims to client-solicitor privilege must be fact sensitive in the sense that the determination must depend on the evidence adduced to support the claim and on the context in which the claim is made. The claim to client-solicitor privilege in the context of litigation is in fact a claim that an exception be made to the most basic rule of evidence which dictates that all relevant evidence is admissible. It is incumbent on the party asserting the privilege to establish an evidentiary basis for it. Broad privilege claims which blanket many documents, some of which are described in the vaguest way, will often fail, not because the privilege has been strictly construed, but because the party asserting the privilege has failed to meet its burden: [citation omitted].

[7] Doherty J.A. confirmed, at para. 98, that the assessment of a claim to solicitor-client privilege must be contextual. Doherty J.A. held that the applicability of solicitor-client privilege to third party communications in circumstances where the third party cannot be described as a channel of communication between the solicitor and client should depend on the true nature of the function that the third party was retained to perform for the client. Doherty J.A., at para. 120, held that if the third party’s retainer extends to a function which is essential to the existence or operation of the solicitor-client relationship, then the privilege should cover any communications which are in furtherance of that function and which meet the criteria for solicitor-client privilege.

[8] In Prosser v. Industrial Alliance Insurance, 2024 ABKB 87, at para. 60, the Court held that information concerning the existence and nature of a solicitor-client relationship, including the fact and nature of a lawyer’s retainer; the identity of the lawyer; the client’s legal concerns, objectives or strategies; and the thought processes, strategies, or objectives of the lawyers are matters that are protected from disclosure by solicitor-client privilege.

[9] The following principles also apply with respect to solicitor-client privilege:

• (i) solicitor-client privilege must “remain as close to absolute as possible” (R. v. Fink, 2002 SCC 61, para 36);
• (ii) solicitor-client privilege protects confidential communications between a client and a lawyer in which legal advice is sought or offered (R. v. McClure, 2001 SCC 14, paras 36-37);
• (iii) solicitor-client privilege extends to communications that disclose whether lawyers were retained and, if so, for what purpose (Prosser v. Industrial Alliance Insurance, 2024 ABKB 87, para 60);
• (iv) solicitor-client privilege also protects not only the legal advice provided, but communications passing between lawyers and clients in support of the provision of legal advice (Wintercorn v. Global Learning Group Inc., 2022 ONSC 4576, para 45);
• (v) the identity of who is paying the defendants’ legal fees is privileged (Kaiser (Re), 2012 ONCA 838, para 30);
• (vi) solicitor-client privilege extends to documents, information, and communications shared or created in a continuum of communications for the purpose of obtaining legal advice and includes documents that are a “necessary step” in the process of receiving legal advice and documents that are incidental to obtaining and giving legal advice and/or that, if produced, would tend to reveal that advice (Wintercorn, para 45; Landry et al. v. HMQ, 2021 ONSC 1297, para 14).

[10] The relevant legal principles with respect to common interest privilege were summarized by Gluestein J. in Wintercorn, para 160.

I summarize the relevant legal principles as follows:

(i) Common interest privilege is established where a lawyer’s communication or advice is shared, on a confidential basis, with a non-client or other “with a sufficient common interest in the same transactions”: Iggillis Holdings Inc. v. Canada (National Revenue), 2018 FCA 51, para 41;

(ii) The concept of common interest privilege originated in the broad context of “parties sharing a goal or seeking a common outcome”: Pritchard, at para. 24;

(iii) “Because the existence of this privilege is so fact-dependent, there can be no hard and fast rules as to when it will or will not arise”: Trillium Motor World, at para. 130;

(iv) Common interest privilege applies when there is an “ongoing interest in completing the transaction which the disclosure was designed to facilitate”. Such an interest may exist through contractual arrangements, including when there is an “ongoing economic relationship”, or when the parties have a “direct pecuniary interest in the transaction”: Maximum Ventures Inc v. De Graaf, 2007 BCCA 510, paras 11 and 16; Iggillis Holdings, paras 32-34;

(v) Common interest privilege is not a “stand-alone privilege”: Power v. RGMP, 2021 ABQB 877, para 20. Communications that are otherwise non-privileged cannot be cloaked in privilege simply because they are exchanged between parties sharing a common interest;

(vi) The underlying solicitor-client privilege attaching to each communication at issue must be established by the party attempting to rely on common interest privilege: Power, paras 30-31;

(vii) The party asserting common interest privilege bears the onus of establishing both the predicate privilege and the common interest intention to maintain confidentiality over the communications: Power, para 32.

[11] The plaintiffs submit that to sustain a claim for litigation privilege, two facts must be established for each document over which privilege is claimed: (1) that litigation was ongoing or was reasonably contemplated at the time the document was created; and (2) that the dominant purpose of creating the document was to prepare for that litigation.

[12] The plaintiffs cite Gichuru v. British Columbia (Information and Privacy Commissioner), 2014 BCCA 259, para 32, as authority for their submission that to establish “dominant purpose”, the party asserting the privilege will have to present evidence of the circumstances surrounding the creation of the communication or document in question, including evidence with respect to when it was created, who created it, who authorized it, and what use was or could be made of it.

[13] In Grand Rapids First Nation v. Canada, 2014 FCA 201, Dawson J.A., writing for the panel of the Federal Court of Appeal, addressed Canada’s assertion of litigation privilege in circumstances where Canada had not adduced affidavit evidence about the dominant purpose for the creation of any individual document over which privilege was claimed. In that case, the motion judge relied on his review of the documents and found their dominant purpose “quite clear on their face”. The motion judge held that as regards the documents in question, the dominant purpose for which each document was produced probably was to seek legal advice or to aid in the conduct of the litigation.

[14] In the decision on appeal, Dawson J.A., at para. 32, agreed that it is possible for the content of a document to establish the purpose for which the document was created. Dawson J.A. wrote that he reviewed each of the non-disclosed documents over which Canada claimed privilege and based on his review, he was not satisfied that the contents of these documents establish that it is more likely than not that each document was prepared for the dominant purpose of seeking legal advice or aiding the conduct of litigation. Dawson J.A. concluded that the evidence before the motion judge was insufficient to demonstrate on a document by document basis that each of the undisclosed documents was created for the purpose of seeking legal advice or aiding in the conduct of the litigation.

[15] The plaintiffs argued that directions in relation to six questions to be answered (addressed at the hearing and provided again in a letter from counsel for the plaintiffs dated December 9, 2024) would enable the parties, working cooperatively, to determine which specific questions require answers and which can be maintained as proper refusals.

The remainder of the endorsement continues with detailed application of these principles to the facts and issues in dispute, including the roles of Mr. Wainwright and Cadwalader, the sufficiency of Schedule “B” lists, the process for review and production of documents, and the court’s directions regarding specific categories of questions and documents. The full text of the endorsement is available at the source link.

Disposition

[98] I hereby give directions to the parties as set out in this endorsement.

[99] If there remain disagreements with respect to assertions of privilege that require a ruling on individual documents or individual questions, counsel may seek a case conference with me to address the procedure to be followed for such determinations.

[100] If the parties are unable to resolve costs, I may be spoken to.

Date: February 26, 2025

Mark L. Cavanagh