Canada: When Loose Lips Will (Or Will Not) Sink Ships: Privilege, Privacy And Wilfulness

The Background

On July 26^th, 2016, the Supreme Court of British Columbia released an interesting decision that addresses questions regarding: (1) the scope of privilege that applies to work done by lawyers in relation to judicial proceedings; and (2) the interpretation of BC's Privacy Act with respect to the requirements of "wilfulness"

In Duncan v. Lessing, 2016 BCSC 1386, the issue centered on claims brought by an individual, Mr. Duncan, against Mr. Lessing, a lawyer that represented Duncan's former wife in family litigation between the two parties. The plaintiff claimed that the defendant lawyer breached his privacy: (1) in the course of serving application materials; and (2) through the conveyance of information about the plaintiff in a casual conversation with another lawyer.

The first alleged breach of privacy concerned prior litigation between the plaintiff and his former wife. In the course of bringing an action against the plaintiff, the defendant's process server unintentionally served an unsealed notice of application and affidavit on several companies not party to the litigation. The plaintiff contended that these documents contained information of circumstances between the couple which were private, including tax returns and a pre-nuptial agreement.

Additionally, the plaintiff also alleged that a breach of privacy took place when the defendant lawyer and another lawyer were conversing over a break in an examination for discovery pertaining to an unrelated action. The defendant discussed the facts of the case without naming the parties and disclosed that he was representing a wife whose husband had previously sold a business in Alberta for $15 million. The other lawyer's client, who was familiar with the fact that the defendant was acting for the plaintiff's wife, was able to deduce the identity of the plaintiff from the information divulged.

In response to the plaintiff's claims, the defendant lawyer raised several defences. With respect to the service of the companies, the defendant contended that, because the impugned actions were undertaken in furtherance of the lawyer's duties to the plaintiff's wife, the defence of absolute privilege provided the defendant with immunity from civil liability. The defence also asserted that neither the service of the companies, nor the disclosure arising from the "casual conversation", resulted in violations of the Privacy Act.

The Decision

Defence of Absolute Privilege Applicable to Breach of Privacy Claim

In handing down the decision, Justice Griffin rejected the plaintiff's claims relating to the first alleged breach of privacy, first confirming that the defence of absolute privilege was applicable:

The absolute privilege that applies to lawyers working for a client in the context of an ongoing judicial proceeding provides a defence to intentional misconduct such as defamation. It clearly also must apply to an error in service of court documents, for all the same policy reasons. Here [the lawyer's] only purpose for service was in furtherance of the Family Action.

The fact that the defendant's actions were undertaken for the sole purpose of furthering his client's interests thus served to shield the defendant from civil liability. Furthermore, Justice Griffin noted that nothing in the Rules of Civil Procedure required a party effectuating service to place the documents in a sealed enveloped marked "confidential" or otherwise. The Court noted that, despite the fact that "serving court documents within a sealed envelope could be a good practice", it was nonetheless the case that "[n]o evidence was called to suggest that service within a sealed envelope is standard practice when a law firm hires a third party to effect service." As a result, the defendant's failure to use sealed envelopes did not bring service of the application outside the scope of absolute privilege.

Information Not Embarrassing or Particularly Unique Won't Support a Finding of "Wilful" Privacy Violation

Furthermore, the Court also held that no breach of privacy arose from the "casual conversation" incident involving the defendant. This was determined on the basis of the Court's finding that the sale of the plaintiff's business was not private. In setting out the rationale for this finding, Justice Griffin noted that:

The plaintiff's evidence failed to prove that Mr. Lessing could only have learned this information from private information disclosed by Mr. Duncan in the Family Action, as opposed to learning it from his own client or general investigations [...] [T]here is no obvious inference here that the sale price in relation to a past business transaction involving several parties was information about which a person involved in the transaction could in the circumstances reasonably be entitled to privacy.

Concluding that the plaintiff could not establish a reasonable entitlement to privacy with respect to the disclosed information, Justice Griffin rejected the basis for the plaintiff's second claim. Of particular interest is the Justice's obiter commentary dealing with the question of whether the defendant's disclosure was a "wilful" violation of the plaintiff's privacy. This discussion included the assertion that subsections 1(1) and (3) of the Privacy Act must be read together to determine whether a breach of an individual's privacy occurred, and that "[t]he act must be wilful, without a claim of right, and the nature, incidence and occasion of the act and the relationship between the parties must be considered." As the information relating to the sale was not embarrassing or particularly unique, the Court determined that the defendant did not willfully reveal private information about the plaintiff or intend to pursue any other malicious intention. In this sense, Justice Griffin distinguished the case at bar from instances involving the disclosure of a medical condition (Hollinsworth (1998), 59 BCLR (3d) 121), something to which shame attaches (Watts v Klaemt, 2007 BCSC 662), or that is deeply personal (Griffin v Sullivan, 2008 BCSC 827).

The Takeaway

While the outcome of the case is a lawyer-friendly decision, the factual situation giving rise to the claim serves as a stark reminder to counsel with a tendency to engage in idle inter-discovery chit chat. Although the information disclosed by the defendant (in this instance) was not "private" per se, a situation involving the communication of potentially embarrassing or personal information could very well leave a lawyer on the wrong side of privacy law (at least in BC) and susceptible to ensuing liability and litigation. The term "wilful" appears in most provincial privacy legislation.

Lawyers will also be relieved to know that the defence of absolute privilege has been confirmed to be available to them in the context of a breach of privacy action.

When Loose Lips Will (Or Will Not) Sink Ships: Privilege, Privacy And Wilfulness

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