Canada: Courts Issue Guidance For Litigation-Privileged Documents During Regulatory Investigations

Certain incidents at a worksite or industrial facility may trigger statutory reporting or investigative requirements. Companies may also want to conduct their own litigation-privileged internal investigation of the same incidents. Two recent Alberta and Saskatchewan cases provide guidance as to whether and when privilege can be claimed over internal investigation materials and when those materials must be produced to regulators.


In Alberta v. Suncor Energy Inc. (Suncor), a worker was fatally injured at a worksite near Fort McMurray, Alta. In anticipation of litigation, either by the Alberta Occupational Health and Safety regulator or due to a potential civil claim, Suncor immediately began an internal investigation under the auspices of litigation privilege.

In response to its obligations under the Occupational Health and Safety Act (OHSA), Suncor provided the names and contact information regarding its internal investigation team, but asserted privilege over its internal investigation findings and report. The government subsequently applied to the Court of Queen's Bench of Alberta (Alberta Court) for disclosure of Suncor's investigation documents.

The first question that the Alberta Court had to answer was whether litigation privilege could even be claimed in such a situation. After a careful analysis, the Alberta Court held that so long as the claimant can establish that the dominant purpose for conducting the investigation was in contemplation of litigation, the fact that a single investigation has a dual purpose – namely regulatory and litigation – does not abrogate a claimant's right to such litigation privilege.

The decision of the lower Alberta Court was appealed to the Alberta Court of Appeal (Appeal Court). The July 2017 Appeal Court decision specifically upheld the lower Alberta Court's legal rationale that litigation privilege could be asserted by a company notwithstanding a statutory obligation under the OHSA to disclose certain information. However, it overturned the lower Court's finding that every document created during Suncor's internal investigation was automatically "clothed" in litigation privilege. Rather, the Appeal Court held that documents over which privilege is claimed must be described with sufficient particularity to indicate whether the dominant purpose for their creation was indeed in contemplation of litigation.

Leave to Appeal the Appeal Court decision has been filed with the Supreme Court of Canada.


Released in December of 2017, R. v. Husky Energy Inc. (Husky) involved a pipeline spill in Saskatchewan. Upon becoming aware of the spill, Husky immediately initiated an internal investigation under legal privilege in preparation of defending against either regulatory prosecution or civil claims brought by impacted parties.

Environmental and Climate Change Canada (ECCC) subsequently initiated an investigation under the federal Fisheries Act. As part of its investigation ECCC obtained a search warrant to search for documents and records in Husky's possession relating to the pipeline spill. Pursuant to the search warrant, Husky supplied approximately 25,000 electronic records, as well as a large number of non-electronic records. However, Husky asserted litigation privilege, solicitor-client privilege, and in some case both types of privilege, over 96 documents, several of which were expert reports. ECCC subsequently brought an application to seek release of the 96 documents pursuant to its search warrant.

In addressing the ability of a claimant to assert litigation privilege while responding to compulsory statutory reporting obligations, the Queen's Bench for Saskatchewan (Saskatchewan Court) in Husky held:

"The existence of a statutory obligation to report on an incident does not necessarily preclude claims of litigation privilege in material created during an investigation conducted, in part, to comply with that reporting obligation. Nor, however, does the existence of potential litigation mean that all material gathered during the investigation is necessarily created for the dominant purpose of litigation [...] Each document or group of documents must be examined, and the analysis must focus on the purpose for which the document was created, not the purpose for which it was obtained"

The Saskatchewan Court confirmed that providing information under compulsion of statute does not demonstrate an intention to waive litigation privilege. Similarly, mere reference to the existence of a privileged document and its conclusions, without more, does not amount to a waiver.

After inspecting the documents in issue and applying the legal principles informing privilege and waiver, the Saskatchewan Court upheld Husky's assertions of privilege with respect to 93 of the 96 documents.


Understanding the rules surrounding the law of privilege is complicated. The rules become even more complicated when companies undertake internal investigations while complying with statutory reporting and investigative obligations. However, the following guidance is emerging:

  • Read the statute closely. Courts will look at the statutory language to determine if a claimant is still able to claim litigation privilege – particularly over internal investigation materials that were created in part, to comply with a statutory obligation.
  • It is insufficient to simply assert litigation privilege. Rather, an investigation must be undertaken for the dominant purpose of addressing potential litigation.
  • Each privilege claim for each document must be described with sufficient detail to confirm that its dominant purpose was in contemplation of litigation.
  • If a document is created under litigation-privilege, providing information from that document to the regulator may not necessarily constitute waiver of that privilege if the same information is required to be produced under compulsion of statute.
  • Courts will scrutinize how internal investigations are conducted. Maintaining privilege over such investigations is assisted by undertaking the following:
    • Creating and maintaining an investigation plan that sets out the purpose, scope, objectives, methods and strategies of the investigation;
    • Creating and maintaining a "sphere of confidentiality" around the investigation records;
    • Providing clear direction on litigation purpose for creation of documents and engagement of experts.

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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