Litigation privilege regularly applies to protect materials
created or assembled in the context of litigation. Its purpose is
to create a "zone of privacy" in relation to pending or
apprehended litigation: Blank v Canada (Minister of Justice) ,
2006 SCC 39 [Blank] at para. 39. In
TransAlta, the respondent Market Surveillance
Administrator (MSA), Alberta's independent electrical watchdog,
sought production of certain records from TransAlta in the context
of an investigation into whether TransAlta had artificially
influenced the price of electricity. TransAlta refused to produce
certain of the records on the basis of litigation privilege,
relying on section 50 of the Alberta Utilities' Commission
Act, SA 2007, c A-37.2 [AUCA]. This provision
contains a process for vetting claims for "solicitor-client
In determining whether litigation privilege fell within the
purview of "solicitor-client privilege" in section 50,
the Court acknowledged that it was abundantly clear since
Blank that solicitor-client privilege and litigation
privilege "are driven by different legal policy considerations
and generate different legal consequences" (para. 28, citing
Blank at para. 33). However, such differences did not
answer the interpretive question before the Court, as prior to
Blank, litigation privilege had been considered a branch
of solicitor-client privilege. Section 50 of the AUCA
(actually its predecessor provision) pre-dated Blank. The
Court held that at the relevant time, the Legislature would have
understood solicitor-client privilege to include litigation
privilege. Moreover, the terminology "is not precise"
even today, such that "a reference to solicitor-client
privilege may yet encompass litigation privilege depending upon the
context in which the term is employed" (para. 33).
The Court also found that while section 50 embodied a convenient
process for determining claims for solicitor-client privilege, it
did not expressly exclude claims for litigation privilege, or any
other privilege recognized at common law. If the Legislature had
intended to remove the right to claim litigation privilege, it
would have said so in express and clear language, rather than by
simply omitting to refer to it.
Finally, the Court had to consider whether litigation privilege
could be claimed in the context of an MSA investigation, raising
the more general question of whether litigation privilege can apply
in regulatory proceedings. The Court held that litigation privilege
can arise in this context, referring to an earlier decision of the
Court and stating (at para. 40):
While an investigation undertaken by the MSA will not directly
result in criminal convictions or prison, nevertheless the
consequences of being found guilty of an "offence" under
the Act could result in millions of dollars of fines and
other penalties of a very substantial nature. Indeed, the ongoing
business of the corporation could be put into jeopardy. Thus, there
is an obvious need for legal advice, and the zone of privacy
contemplated by litigation privilege, when a party or parties are
facing an investigation which could result in the prosecution of
offences with such potential consequences.
The Court thus fastened on the consequences of the proceedings
(and implicitly, their adversarial nature) as the hallmark for
determining applicability of the privilege, in contrast, for
example, to previous Alberta Queen's Bench authorities that
considered mandatory disclosure as key (see, for example, Alberta Treasury
Branches v Ghermezian , 1999 ABQB 407).
TransAlta thus signals a clear confirmation that
litigation privilege can apply in the context of regulatory
proceedings, provided that the matter is sufficiently adversarial,
or in other words, provided the consequences are sufficiently
serious for the party claiming the privilege. As well,
TransAlta bolsters the potential scope for applicability
of the privilege in the statutory context, requiring express and
clear language to exclude the privilege, and increasing the
likelihood that a reference to "solicitor-client
privilege" will include litigation privilege (perhaps
dependent on the date the provision was enacted).
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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