TABLE OF CONTENT

1. Introduction and Context

2. Overview of the Principle : Celanese and Subsequent Decisions

3. Rules of Conduct in Common Law Provinces

4. Ethical Implications in Quebec

5. Conclusion and General Advice

 

1. INTRODUCTION AND CONTEXT

Case law and Codes of conduct across Canada have cemented the principles guiding how parties should behave when privileged documents are communicated inadvertently or retrieved without authorization from the beneficiary of privilege. The increasing exchange of large volumes of information enabled by new technologies can easily lead to this unfortunate situation, which can equally affect materials covered by solicitor-client privilege, settlement negotiations or litigation privilege. Herein, we offer an overview of the rules governing the conduct an attorney should adopt in response to this situation. Without surprise, no use can be made of privileged materials obtained without consent, but it is also clear that these materials cannot even be viewed or held by the receiving or retrieving party and must be returned promptly. 

2. OVERVIEW OF PRECEDENTS : CELANESE AND SUBSEQUENT DECISIONS

The Supreme Court of Canada has established that professional secrecy must be as absolute as possible and situations in which it can be set aside without a client’s consent are strictly limited^[1]. These principles are the continuation of a long list of decisions by the Supreme Court that established the protections provided by privilege^[2]. Privileged information or documents imply the existence of a beneficiary and rights and prerogatives attached to this privileged status. Whatever privilege a person benefits from, waiver of that privilege is not to be presumed. Thus, in the context of a solicitor-client relationship, confidentiality or secrecy of exchanges are rights that belong exclusively to the client and cannot be waived by actions taken by the lawyer without the client’s knowledge or consent. The waiver of privilege must be clear and unequivocal.

In Celanese Canada Inc. v. Murray Demolition Corp.^[3] (hereafter “Celanese”), the Supreme Court provided clear guidelines relating to the unauthorized communication of privileged materials. Celanese Canada Inc. obtained an Anton Piller^[4] order and had it enforced by independent third parties. In the process, Celanese’s lawyers accessed all of the evidence gathered, including privileged documents exchanged between the opposing party and its lawyers. Some of the privileged materials had been identified and placed under seal, but Celanese’s lawyers nevertheless requested and obtained access to them, without the knowledge of opposite party, who was only informed after the occurrence. This led to an unsuccessful request for the return of the documents and a motion for a declaration of inability of Celanese’s lawyers. Celanese set out the criteria determining whether an attorney in this situation should be declared unfit for purpose. The Supreme Court of Canada also confirmed that although not all confidential information protected by solicitor-client privilege is of equal importance, the simple possession of such information by the opposing party compromises the integrity of the administration of justice and poses a real risk of significant prejudice^[5].

Celanese set forth three clear, minimal, and binding obligations for a lawyer who inadvertently receives privileged materials. First, the lawyer needs to notify the sender, then advise the opposite counsel of the extent to which the documents were examined, and finally promptly return them^[6]. Since Celanese, case law has confirmed these important principles. In the 2021 Alberta Court of Appeal decision 0678786 BC Ltd v. Bennett Jones LLP^[7], the court cited the Celanese precedent and reaffirmed the protocol for dealing with privileged documents. The Court wrote that the simple duty of the recipient counsel is to seal them up, to not read them further, to make no copies, to take no notes, to return any copies or notes already taken and to apply to the court for a ruling on whether privilege had been waived, if necessary. The Court of Appeal declared that this protocol should be observed whenever there is a reasonable expectation that the documents are privileged. The Court specified furthermore that any uncertainty about whether solicitor and client privilege existed, or whether there had been waiver of such privilege, should be resolved by the court before the documents are disclosed or used in any way^[8]. To reach its conclusions, the Court relied on precedents, but also on article 7.2-13 of the Code of conduct of the law society of Alberta, which will be further discussed in the next section.

In Brewer v. Royal College of Dental Surgeons of Ontario^[9], the Superior Court of Ontario did not specifically apply the Celanese guidelines to the case but confirmed that courts have the ability to intervene to order the return of privileged material and restrain the use of information contained in them when such documents have been disclosed without the consent of the beneficiary^[10]. The Court concluded that the privileged documents in question could not be used.

In 2017, the British Columbia Court of Appeal wrote that inadvertent disclosure of a privileged document cannot without certainty lead to an implied waiver and that a specific protocol needs to be applied in such circumstances^[11]. Without citing Celanese, the Court’s conclusion in this case was in line with the guidelines provided in Celanese and it ordered the privileged documents be returned or destroyed and that no further use be made of them^[12].

3. RULES OF CONDUCT IN COMMON LAW PROVINCES

The Federation of Law Societies of Canada, composed of Canada’s lawyers and notaries, has adopted a “Model Code of Professional Conduct” with the purpose of giving each Canadian province a generic set of ethics rules. Individual law societies in Canada are free to adopt, in whole or in part, this model, with or without modifications. The Federation's Code of Professional Conduct contains only one provision that is relevant to the issue at hand, which may be characterized as minimalist. Section 7.2-10 states that “A lawyer who receives a document concerning the representation of another lawyer's client and knows or ought to know that the document was inadvertently sent must promptly notify the sender. ” This section has not been adopted by the Quebec Bar but has been introduced in this format or with some variation by all other Canadian law societies. For instance, the Ontario Law Society Rules of Professional Conduct provides at section 7.2-10 that “A lawyer who receives a document relating to the representation of the lawyer's client and knows or reasonably ought to know that the document was inadvertently sent shall promptly notify the sender.” The Law Society of British Columbia provides in more detail the way in which a lawyer should act. Section 7.2-10 states that :

“A lawyer who has access to or comes into possession of a document that the lawyer has reasonable grounds to believe belongs to or is intended for an opposing party and was not intended for the lawyer to see, must:

(a) in the case of a paper document, return it unread and uncopied to the party to whom it belongs,

(b) in the case of an electronic document, delete it unread and uncopied and advise the party to whom it belongs that that was done, or

(c) if the lawyer reads part or all of the document before realizing that it was not intended for him or her, cease reading the document and promptly return it or delete it, uncopied, to the party to whom it belongs, advising that party:

(i) of the extent to which the lawyer is aware of the contents, and

(ii) what use the lawyer intends to make of the contents of the document.”

On this last point, it remains to be decided what if any use can be made of documents in this context. Indeed, the text of the BC version of section 7.2-10 perhaps implies that some use can be made. We think that, at a minimum, whatever use can be made of privileged documents must first be authorized by the beneficiary of privilege or by the Court. These codes of conduct are not formal laws adopted by a legislative body, but are rather guides that are adopted by the various law societies. We are therefore of the view that they should not enable behavior that is prohibited by case law.

Apart from this possible opening to using documents, section 7.2-10 of the BC Code of conduct seems to essentially reproduce the principles provided by the Supreme Court in Celanese and forces lawyers to react promptly when they receive privileged documents. The British Columbia code of conduct specifies what needs to be done in case of an electronic document : the lawyer must delete it punctually and advise the other party to whom it belongs that this was done. This precision is highly pertinent since most communications these days are done electronically. Interestingly, the Code of Conduct of the Law Society of Alberta is also more precise as it provides at section 7.2-13 that “A lawyer who comes into possession of a privileged communication of an opposing party must not make use of it and must immediately advise the opposing lawyer or opposing party”. It is interesting to note that, in addition to relying on precedents, the Bennett Jones decision from the Alberta Court of Appeal cited section 7.2-13 of the Albertan Code of Conduct in support of its conclusion^[13].

Failure to abide by these principles results in a breach of the Law Societies’ codes of conduct and there are therefore ethical implications for a lawyer who unlawfully uses privileged materials obtained without consent from the beneficiary of privilege. Although some Law societies offer less precise rules of conduct governing the situation of unauthorized communication of privileged materials, case law offers clear guidelines allowing to fill in the blanks.

4. ETHICAL IMPLICATIONS IN QUEBEC

The Quebec Bar has not adopted the Model code of professional conduct and there is no law or regulation that specifically deals with the inadvertent disclosure or possession of privileged information when it comes to lawyers. Nevertheless, the issue might be implicitly addressed through provisions in Quebec’s legislation that address confidentiality^[14]. In addition, and perhaps more importantly, professional secrecy is a fundamental right protected by section 9 of the Charter of Human Rights and Freedoms^[15] :

9. Every person has a right to non-disclosure of confidential information [In French: professional secrecy].

No person bound to professional secrecy by law and no priest or other minister of religion may, even in judicial proceedings, disclose confidential information revealed to him by reason of his position or profession, unless he is authorized to do so by the person who confided such information to him or by an express provision of law.

The tribunal must, ex officio, ensure that professional secrecy is respected.

The Charter of Human Rights and Freedoms is a supra-legislative law, so, despite the absence of a code of conduct similar to other provinces, privilege in Quebec is strongly protected. 

Regardless of the absence of specific disposition governing the unauthorized communication of privileged information, as exists in the other provinces Codes of conduct, the principles set forth in Celanese and other precedents govern how lawyers should handle this situation. The Quebec Superior Court, in Journeaux v. Perreault, refers to Celanese and confirms that there is a legal responsibility, once the privileged materials are disclosed, for the third party lawyer not to consult the documents in question and to isolate and protect them in order to avoid any further consultation^[16]. Otherwise, even without referring to Celanese, Quebec Courts have clearly established that privileged materials obtained without authorization cannot be used and must be returned^[17]. The failure to comply with these recommended practices would likely result in the violation of a lawyer’s ethical obligations in that a lawyer has a general duty not to act in manner which is detrimental to the system of justice^[18]. The protection of the confidentiality of privileged information is of central importance to the sound administration of justice^[19].

5. TAKE AWAYS

In addition to all of the above, privilege is also protected by the Canadian Charter of Rights^[20]. In all cases, at a minimum, it would be well advised for lawyers to consider Celanese. Upon realizing that privileged information has been accessed by an exterior party, a lawyer must promptly notify this other party that he/she is in possession of his/her client’s privileged information. He/she should also immediately take measures to cease accessing this information, to isolate it and to return it. Any disagreement as to the privileged nature of a document should be settled at Court before it is consulted by the external party. Importantly, a party who realizes that it is in the unauthorized possession of privileged materials should take the initiative to take these steps, even if it has not been advised by the party who owns the privileged materials to do so. Further, the former should promptly advise the latter of the measures put in place to protect the materials.

A recent decision by the Superior Court of Quebec^[21] illustrates the appropriate application of these principles in a context where Quebec’s financial regulation agency (The Autorité des marchés financiers) seized documents belonging to a party under investigation. Privileged documents were identified by the beneficiary of privilege and a hearing was held under a confidentiality order so that the agency could make representations about which documents ought to be covered by privilege and which documents it should be allowed to view. Interestingly, although the beneficiary of privilege was absent from the hearing and presented no evidence, the agency still had to justify why it felt some documents were not privileged.

Clients should be cautious when transmitting privileged information by email. Often, external email servers can be accessed by external parties and therefore an external party can gain access to privileged information without authorization. In such a situation, the rules of conduct guiding the prompt isolation, destruction or return of privileged documents would most often be applicable.

We remain available for any further information.

 

[1] Canada (Attorney General) v. Chambre des notaires du Québec, 2016 SCC 20, at para. 82.

[2] Descôteaux et al. v. Mierzwinski, [1982] 1 SCR 860; Maranda v. Richer, 2003 SCC 67; Lavallee, Rackel & Heintz v. Canada (Procureur général); White, Ottenheimer & Baker v. Canada (Procureur général); R. v. Fink, 2002 SCC 61; R. v. Brown, 2002 CSC 32; Canada (Privacy Commissioner) v. Blood Tribe Department of Health, 2008 SCC 44; Canada (Attorney General) v. Federation of Law Societies of Canada, 2015 SCC 7; Foster Wheeler Power Co. v. Société intermunicipale de gestion et d'élimination des déchets (SIGED) inc., 2004 SCC 18; Blank v. Canada (Minister of Justice), 2006 SCC 39.

[3] Celanese Canada Inc. v. Murray Demolition Corp (hereafter “Celanese”), 2006 SCC 36 (CanLII), [2006] 2 SCR 189.

[4] An Anton Piller order is a specific form of civil injunctive relief which urges a defendant to permit a plaintiff to enter its property to search for and seize records and evidence, including electronic data and equipment. This procedure originated in the 1975 English Court of Appeal case Anton Piller K.G. v. Manufacturing Processes Ltd.

[5] Celanese, at para. 34 and 42.

[6] Celanese, at para. 62.

[7] 0678786 BC Ltd v. Bennett Jones LLP (hereafter “Bennett Jones LLP”), 2021 ABCA 62.

[8] Bennett Jones LLP, at para. 26-28.

[9] Brewer v. Royal College of Dental Surgeons of Ontario, (hereafter “Brewer”), 2021 ONSC 5697.

[10] Brewer, at para. 13-16.

[11] British Columbia (Attorney General) v. Lee (hereafter “Lee”), 2017 BCCA 219, at para. 56, 57 and 61.

[12] Lee, at para. 62-63.

[13] Bennett Jones LLP, at para. 26-28.

[14] The Quebec Code of Professional Conduct of Lawyers CQLR c B-1, r 3.1,provides that “A lawyer must ensure the confidentiality of all information concerning the affairs and activities of a client of which the lawyer becomes aware in the course of the professional relationship” (section 60) and that “A lawyer must not use confidential information with a view to obtaining a benefit for himself or for another person” (section 63).

[15] CQLR c C-12.

[16] Journeaux v. Perreault, 2011 QCCS 5187, at para. 26.

[17] Guillemette v. Smith, 2009 QCCA 2190, at para. 5, 8, 9 and 25; Construction Frank Catania et Associés inc. (Syndic de), 2015 QCCS 1251; .

[18] Code of Professional Conduct of Lawyers, CQLR c B-1, r 3.1, art. 111.

[19] Daco Archery v. Topo Production, [1991] R.J.Q. 2885;  Lavallee, Rackel & Heintz v. Canada (Attorney General); White, Ottenheimer & Baker v. Canada (Attorney General); R. v. Fink, 2002 SCC 61; Journeaux v. Perreault, 2011 QCCS 5187. Q12

[20] Canada (Attorney General) v. Chambre des notaires du Québec, 2016 SCC 20, par. 28-30

[21] D.L. v Autorité des marchés financiers, 2022 QCCS 2157