Canada: Records Management @ Gowlings - June 3, 2011 - Volume 2, Number 2

Last Updated: June 7 2011

Edited by Louis A. Frapporti

In this issue:

Legal Technology


Canreal Management Corporation v. Mercedes-Benz Canada Inc.

The plaintiff brought an order to strike out the defendant's statement of defence. The plaintiff alleged that the defendant continually failed to provide full discovery of documents.

Although the defendant had disclosed a large volume of documents, the plaintiff claimed the need for discovery regarding other critical documentary evidence which had not been disclosed.

The plaintiff is a property management and real estate services company that alleges it was retained by the defendant, Mercedes-Benz Canada Inc., to assist in the acquisition of a property for an auto dealership.

In its statement of defence, the defendant denies the existence of any agreement with the plaintiff and denies that it received any benefit as a result of the plaintiff's efforts.

In strict compliance with the Rules of Court, the plaintiff demanded the discovery of documents identifying six specific categories of documents that the plaintiff considered relevant. These included all communication in any form between the parties during the relevant period as well as the defendant's internal communication and meeting records relating to the dealings with the plaintiff and the property in question.

Following motions which resulted in two supplementary list of documents, the plaintiff determined through a former employee of the defendant that additional relevant documents (minutes, emails, reports) did exist but had not yet been disclosed. As a result, the plaintiff brought a motion under Rule 2 of the Rules of Court to have the defendant's appearance or statement of defence struck out. The plaintiff claimed that even if all relevant documents had been disclosed, the disclosure would be too late because the plaintiff was already prejudiced by having to proceed with an examination for discovery when it did not have all the relevant documents.

The court stated that striking out the statement of defence is a "draconian remedy only to be invoked in the most egregious of cases because it deprives the litigants of a trial on the evidence." 

The court accepted that the plaintiff had thus far been prejudiced by having to conduct its own examination for discovery without the benefit of full document production. However, the court  balanced the prejudice to the plaintiff, with the prejudice to the defendant that would arise if denied the opportunity to advance a defence.

As a result, the court made the following orders:

1. The plaintiff is entitled to cross-examine the defendant on all matters relevant to document production. Costs of examination will be borne by the defendant.

2. If further documents are identified, the discovery by the plaintiff may be adjourned until the documents have been produced.

3. As a result of the above orders, any costs related to further examinations will be borne by the defendant.

Mosher v. Coast Publishing Ltd., 2010 NSSC 153

The applicants brought a motion for:

1) an abridgement of the notice period required to bring the application.

2) disclosure of information from the two respondents (Coast Publishing Limited and Google Inc.)  which could lead to the identity of the anonymous internet users who authored and published comments which the applicants allege as defamatory.

Both respondents stated that they would not appear in opposition to the application.

Under Rule 14.12(1) the court stated that "a judge may order a person to deliver a copy of a relevant or relevant electronic information to a party or at the trial or hearing of a proceeding."

The court stated that the Rules are flexible enough to require the production of information in the pre commencement stage because the applicants need the information in order to identify the individual(s) who committed the alleged defamations. Therefore, the order entails a process to identify the individuals because the applicants must know who to start an action against before they can actually commence with the action.

The court granted the order and stated that "the court does not condone the conduct of anonymous internet users who make defamatory comments and they like other people have to be accountable for their actions."

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