Canada's Supreme Court tells Privacy Commissioner she can't expand her mandate to include the review of documents over which solicitor-client privilege has been claimed
Unlike the United States, Canada has comprehensive federal privacy legislation that applies to businesses — namely, the Personal Information Protection and Electronic Documents Act (PIPEDA). It regulates the collection, use and disclosure of all kinds of "personal information" by commercial enterprises governed by the Act. "Personal information" is defined broadly under PIPEDA to include any information about an identify able individual, with only minor exceptions. PIPEDA sets out not only the privacy obligations of businesses but also the rights of people to access their personal information and the complaint procedure if access is denied.
The steward of these privacy protections is Canada's federal Privacy Commissioner, who has broad powers and a strong public policy mandate. It is the Privacy Commissioner who investigates complaints under PIPEDA, makes findings regarding the merits of a complaint and recommends what action should be taken. The Privacy Commissioner can force a business to produce documents as part of an investigation.The Privacy Commissioner can publicize any information relating to a business's practices regarding personal information management, potentially generating public censure against that business. With the complainant's consent, the Privacy Commissioner can also seek a court-ordered remedy against a business.
The Privacy Commissioner has been testing the outer limits of these powers in the sensitive area of solicitor-client privilege (known as "attorney-client privilege" in the US).
In Canada (Privacy Commissioner) v. Blood Tribe Department of Health, 2008 SCC 44, the Supreme Court of Canada rejected the Privacy Commissioner's attempt to expand her mandate to include the review of documents over which a claim of solicitor-client privilege has been asserted in order to determine whether they are in fact privileged. That role remains reserved for the courts.
The Blood Tribe case
The Supreme Court of Canada's decision arises from what began as a typical privacy request. An employee at the Blood Tribe Department of Health was fired, after which she made a request under PIPEDA for access to all her personal information possessed by her former employer. These types of requests have become common and are often made to collect information for a lawsuit.
In this case, the former employee wanted access to her personnel file because she suspected that her employer had collected inaccurate information about her and had improperly used that information to discredit her, leading to her dismissal.
The employer denied access to the file, without explanation. The ex-employee then filed a complaint with the Privacy Commissioner.
In investigating the complaint, the Privacy Commissioner requested all of the documents from the employer. The employer provided some documents, but declined to produce those it viewed as privileged. At the time of the dismissal, the employer had sought legal advice from its solicitors and these communications formed part of the employee's file. PIPEDA clearly provides that a business is not required to provide an individual with access to privileged documents.
It was at this point that the Interim Privacy Commissioner, Robert Marleau, pushed the limits of his power. He considered that the Privacy Commissioner's role and authority included reviewing documents over which privilege had been claimed to ensure that they were in fact privileged. The employer had filed an affidavit substantiating its claim for privilege, which was unchallenged. Nonetheless, the Commissioner ordered the employer to produce the documents in question under section 12 of PIPEDA, which provides, in part, that the Commissioner may compel persons to "produce any records and things that the Commissioner considers necessary to investigate the complaint, and in the same manner and to the same extent as a superior court of record." That order was challenged by Blood Tribe, ultimately leading to the Supreme Court's decision.
There were no special circumstances in the case to question the privilege claim; quite the contrary. The fact that the employer sought legal advice regarding the filing of an employee could not be more reasonable, nor more routine. Essentially, the Privacy Commissioner was claiming the power to compel production of privileged documents on a routine basis. As the Supreme Court observed, piercing the privilege would become the norm.
The Privacy Commissioner, Jennifer Stoddart, characterized the case this way, before the Supreme Court:
[T]his case is about calling the private sector to account for its claims of privilege over documents containing personal information of others. Whether their claims turn out to be completely right, honestly equivocal, overly broad, inadvertently wrong, or intentionally misleading, they must be independently verified in order to give proper meaning to the fundamental right of access to one's personal information.
The Supreme Court agreed with this description, yet rejected the claim that the Privacy Commissioner had the power to make these determinations.
Supreme Court's decision
This is the first case in which the Supreme Court has been called upon to interpret PIPEDA. In contrast, the court has repeatedly been called upon to rule on the nature and scope of solicitor-client privilege. The court has, in a series of strong and clear decisions, repeatedly affirmed that solicitor-client privilege is a fundamental right that must be as absolute as possible. In this context, it is not surprising that the court unanimously held in Blood Tribe that PIPEDA does not provide the Privacy Commissioner with the authority to review or compel the production of documents over which solicitor-client privilege is claimed.
In Blood Tribe, the Privacy Commissioner advanced a series of arguments in support of her claim, all of which were unsuccessful. Most significantly, the Commissioner argued that section 12 of PIPEDA gave the Commissioner the same powers as a court, which has the right to adjudicate on privilege claims. The court held that the Commissioner is an investigator, not an adjudicator. Further, the Commissioner is not impartial. The Commissioner may become adverse in interest to the party whose documents are the subject of a complaint and, further, may make the information public. The court concluded that the Commissioner's argument rested on a false analogy between the Commissioner and the courts.
The court was also troubled with the Commissioner's position that reviewing privilege claims should be routine and "the norm," rather than being reserved for exceptional and rare circumstances. The court stated: "Even courts will decline to review solicitor-client documents to adjudicate the existence of privilege unless evidence or argument establishes the necessity of doing so to fairly decide the issue."
The court characterized the Commissioner's arguments as a denial of the fundamental importance of solicitor-client privilege and observed that these arguments illustrate the "slippery slope" on which the Commissioner would place the privilege's "future health and vitality" in the regulatory context.
The court did agree that there needed to be a procedure to test the private sector's assertions of privilege, in order to give meaning to an individual's fundamental right under PIPEDA to access his or her personal information. However, the court observed that PIPEDA already provided two routes through which the Commissioner could seek such a review by the Federal Court. The Commissioner was free to challenge a claim of privilege, but was required to do so in court.
Implications beyond privacy context
Although the court's decision was made in the context of PIPEDA, it has implications for other administrative bodies operating under similar statutes. The court noted that there are 14 other Canadian federal statutes with substantially identical wording to section 12 of PIPEDA. For example, parallel wording appears in the federal human rights legislation, lobbyist legislation and legislation regarding the Canadian Security Intelligence Service (see Canadian Human Rights Act, R.S.C. 1985, c. H-6, s. 50; Lobbyists Registration Act, R.S.C. 1985, c. 44 (4th Supp.), s. 10.4; Canadian Security Intelligence Service Act, R.S.C. 1985, c. C-23, s. 50). The Supreme Court decision should prevent the abrogation of privilege in these administrative/regulatory regimes as well.
This decision marks another important step in the Supreme Court's protection of solicitor-client privilege in recognition of its importance to our justice system. The court's description of the privilege is, perhaps, the broadest yet:
[I]t is now unquestionably a rule of substance applicable to all interactions between a client and his or her lawyer when the lawyer is engaged in providing legal advice or otherwise acting as a lawyer rather than as a business counsellor or in some other non-legal capacity.
Government officials should accept this case as a strong message in support of the protection of solicitor- client privilege. Perhaps in Canada we can avoid the situation in the United States where, over the past several years, solicitor-client privilege has been under attack — not because of court decisions but because of aggressive regulatory policies regarding waiver.
Government officials have been routinely pressuring companies to waive privilege as a condition of receiving credit for cooperating with an investigation. This has become known as "coerced waiver." As a result, a "culture of waiver" developed, giving rise to the same types of concerns about the need to preserve and protect privilege to serve the administration of justice.
About a decade ago, the US Department of Justice began to adopt policies that formally encouraged prosecutors to request waivers of privilege. The US Attorney for the Southern District of New York went so far as to publicly call for a complete waiver of privilege by all corporations wishing to obtain credit for their cooperation (see the ABA submission to the Committee on the Judiciary of the US House of Representatives, dated March 3, 2006). The US Sentencing Commission also amended the Federal Sentencing Guidelines in 2004 to incorporate waiver of privilege as a relevant factor. A number of other government agencies adopted practices that weakened privilege protections.
In March 2006, a survey of more than 1,400 corporate counsel (in-house and external), organized by the Association of Corporate Counsel, the National Association of Criminal Defence Lawyers and the American Bar Association, found that almost 75 percent of respondents believed that a culture of waiver existed.
The ABA, assisted by state and local Bar associations, has made some progress in its initiative to oppose government waiver policies, practices and procedures that have the effect of eroding privilege (see, for example, the ABA letter to the Attorney General dated May 2, 2006, and related material available on the ABA website at www.abanet.org/ poladv). In 2006, the US Sentencing Commission voted unanimously to remove the privilege waiver provisions from the Federal Sentencing Guidelines. The Commodity Futures Trading Commission also voted to reverse its privilege waiver policy in March 2007. In July 2007, an Act to provide appropriate protection to attorney-client privileged communications and attorney work product, H.R. 3013, 110th Congress, 1st Session was introduced into Congress that would preclude an agent or attorney of the United States from requesting that an organization waive privilege or considering such waiver as a factor in determining whether the organization is cooperating with the government. Congress passed the Bill in November 2007, and it has been referred to the Senate Committee on the Judiciary.
The coerced waiver issue in the United States raises some of the same concerns as the review of privileged documents by administrative or regulatory bodies in Canada. These practices have the potential to discourage companies from seeking legal advice, which in turn impedes the ability of lawyers to counsel their clients on compliance with the law. Accordingly, although these practices may offer short-term gain to government agencies, in the long term they may undermine rather than enhance compliance with the law.
As stated by the ABA, privilege is the "bedrock of the client's rights to effective counsel and confi-dentiality in seeking legal advice." Privilege plays a key role in permitting companies to get advice about legal compliance, and to identify and fix shortcomings, to everyone's benefit.
Supreme Court's next decision
The Supreme Court of Canada will soon hear a case that addresses the privacy of government, rather than business, and in this context the Supreme Court will again be called upon to consider the importance of solicitor-client privilege. Legislation in Canada has established that members of the public are entitled to access government information, but this has not generally been regarded as a constitutional right.
In the appeal of Criminal Lawyers' Association v. Ontario (Ministry of Public Safety and Security) (2007), 86 O.R. (3d) 259 (C.A.), the Supreme Court will consider whether or not the constitutional right to freedom of expression (usually called "freedom of speech" in the US) under the Canadian Charter of Rights and Freedoms provides a constitutional "right to know" all information in the hands of government.
The Criminal Lawyers' Association case arises from a request for access to government information under the Ontario Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F. 31. The Canadian Criminal Lawyers' Association sought access to government information regarding a police investigation into a murder case. Judicial criticism of the conduct of a prosecutor and the police had led to a stay of the murder charges, as well as to a review of the impugned conduct. The resulting report, which found no deliberate misconduct, was not publicly released. The association sought access to all information regarding the review, including the report. The request for access was refused on the basis of three exemptions in the Act: law enforcement; personal privacy; and solicitor-client privilege. The association appealed to the Ontario Information and Privacy Commissioner.
The Information and Privacy Commissioner agreed that the three exemptions applied. However, he also had to consider whether to apply the public interest override: the Freedom of Information and Protection of Privacy Act provides that certain exemptions from the government's obligation to provide access do not apply where a compelling public interest in disclosure clearly outweighs the purpose of the exemption. He concluded that a sufficiently compelling public interest existed to override the exemption for personal privacy. However, under the Act the override was not available for the other two exemptions — law enforcement and privilege.
The Supreme Court of Canada is now being asked to decide whether the public interest override is unconstitutional, since it does not apply to all exemptions. The Criminal Lawyers' Association contends that it is contrary to section 2 of the Charter ("Everyone has the following fundamental freedoms:... (b) freedom of thought, belief, opinion, expression, including freedom of the press and other media of communication") and to the underlying principle of constitutional democracy, which the association submits provides a right to compel government to disclose all information subject only to section 1 of the Charter. Section 1 "guarantees the rights and freedoms set out in it subject only to such reasonable limits prescribed by law as can be demonstrably justified in a free and democratic society."
In this context, the Supreme Court will again be called upon to consider the fundamental nature of solicitor-client privilege. If a public interest override applies to privilege, it again opens the door to the potential erosion of privilege through the Privacy Commissioner's applying a public interest test, on a case-by-case basis, to decide whether privilege should be protected, rather than the near-absolute protection the Supreme Court has so strongly reinforced.
This article was originally published in the 2008 Lexpert Guide to the Leading Cross-Border Litigation Lawyers in Canada.
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