Tag: issues of privilege
Communications between a client and litigation counsel may be considered privileged, and therefore may not be producible in the litigation.
This privilege can be extended to communications between parties and counsel to litigation who have a “common interest”.
“Common interest privilege” has been described as arising “where one party (party A) voluntarily discloses a document which is privileged in its hands to another party (party B) who has a common interest in the subject matter of the communication or in litigation in connection with which the document was brought into being.” The result is that the document is privileged in the hands of party B.
To put it another way, in the leading case of Iggillis Holdings Inc. v. Canada (National Revenue), 2018 FCA 51 (CanLII), (leave to the Supreme Court of Canada dismissed) the Federal Court of Appeal stated:
[S]olicitor-client privilege is not waived when an opinion provided by a lawyer to one party is disclosed, on a confidential basis, to other parties with sufficient common interest in the same transactions. This principle applies whether the opinion is first disclosed to the client of the particular lawyer and then to the other parties or simultaneously to the client and the other parties. In each case, the solicitor-client privilege that applies to the communication by the lawyer to his or her client of a legal opinion is not waived when that opinion is disclosed, on a confidential basis, to other parties with sufficient common interest in the same transactions.
Common interest privilege is not a “stand-alone privilege”: it extends an existing privilege to the receiving party. The communication must be otherwise privileged for common interest privilege to apply. For example, a document that is subject to privilege in the hands of party A may also remain privileged in the hand of party B, if there is a common interest at the time the document is disclosed.
The onus of establishing that a document is privileged from production rests on the party asserting the privilege. That party must provide evidence that supports the claim of privilege. If necessary, the court can review the documents in order to decide the validity of the claim: Rule 30.04(6) of the Rules of Civil Procedure.
The determination of whether the privilege exists depends upon objective evidence of the purpose and content of the communications and not the mere belief of the parties.
The concept is discussed at length in the matter of Ross v. Bragg, 2020 BCSC 337 (CanLII). There, the plaintiff made a claim against a number of defendants for damages relating to a lost business opportunity.
Correspondence between one of the defendants and their lawyer was shared with another defendant. If these documents contained legal advice, they would remain privileged in the hands of all of the defendants. The court reviewed the documents to determine whether they contained legal advice as not all documents from a lawyer are subject to privilege.
As an example of the application of the claim of privilege, the court ordered the production of minutes of a meeting between the defendants relating to discussions of the business opportunity, as these were not privileged, but refused to order production of the minutes relating to discussions of the defence to the litigation.
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We all know that lawyers have a duty to hold client information confidential – it’s one of the foundations of our legal system. But estates are a special matter. If we follow the letter of the law regarding confidentiality, a drafting lawyer would be unable to release the testator’s will following their death.
To overcome this potential problem, the common-law has developed what is known as the “wills exception” to the rules regarding confidentiality between a lawyer and their client. The “wills exception” lets the drafting lawyer divulge the existence and contents of a will to those with an interest in the estate. Easy – problem solved.
Of course, not all estates are straightforward, and matters can get complicated if a will is contested. During an estate dispute, many third parties may request that a drafting lawyer divulge certain information about the deceased’s estate planning. The purpose is to find information that can help shed light on the deceased’s true intentions in relation to their estate.
Since deceased individuals can’t speak for themselves and explain intentions or waive their rights, caselaw has made it clear that the estate trustee may step into the shoes of the deceased and waive confidentiality or privilege. However, the group of individuals who may have the drafting lawyer waive privilege or confidentiality could be quite diverse, including beneficiaries, next of kin, and potentially even creditors of the deceased.
Since it’s unlikely that this group of individuals will speak with one mind in an estate dispute and collectively decide to waive privilege or confidentiality, a lawyer who is faced with the issue of releasing confidential information or documents should seek the consent of all parties with a financial interest in the estate before releasing such documents. And in some cases, the drafting lawyer may wish to seek the guidance of the court on the issue of what, if any, documents they should release.
For a detailed discussion of the issue of solicitor client privilege in an estate context, this paper reviews many of the key cases.
Disclosure rules for trusts
The cases related to trusts are many, but a few rules have emerged in relation to disclosure duties related to trust arrangements.
- Disclosure to a beneficiary: As a general rule, the beneficiaries of a trust may, on reasonable notice, require the trustees to produce for their inspection any trust document that the beneficiaries wish to see.
- Disclosure to a discretionary beneficiary: While a discretionary beneficiary is entitled to view trust documents, they are not entitled to see any documents or information pertaining to why the trustee did (or did not) exercise their discretion in the trust.
- Trustee obligation to inform: Generally, there is no positive obligation on the part of a trustee to give unsolicited information to beneficiaries. There are some exceptions however – most notably with minor beneficiaries. A trustee of a trust in which there are minor beneficiaries has a positive obligation to inform the minor beneficiary of the existence of the trust once they come of age, and to show the trust deed and any other relevant documentation that explains or sets out the basis of the trust.
For a more detailed examination of disclosure rules relating to trusts, this paper discusses many of the leading cases in this area. Thanks for reading.
Listen to Preparing for Trials in the Context of Contested Passing of Accounts
In this podcast, Craig Vander Zee and Paul Trudelle discuss trial preparation considerations in the context of a contested passing of accounts.