R. v. Clarke (B.E.) et al., (2015) 356 N.S.R.(2d) 364 (SC)

• Judge: Coady, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: February 27, 2015
• Jurisdiction: Nova Scotia
• Citations: (2015), 356 N.S.R.(2d) 364 (SC);2015 NSSC 59

R. v. Clarke (B.E.) (2015), 356 N.S.R.(2d) 364 (SC);

    1126 A.P.R. 364

MLB headnote and full text

Temp. Cite: [2015] N.S.R.(2d) TBEd. MR.001

Her Majesty the Queen v. Bruce Clarke, R. Blois Colpitts and Daniel Potter (defendants/applicants) and The Nova Scotia Securities Commission (respondent)

(CRH 346068; 2015 NSSC 59)

Indexed As: R. v. Clarke (B.E.) et al.

Nova Scotia Supreme Court

Coady, J.

February 27, 2015.

Summary:

The accused were charged with fraud and conspiracy to commit fraud for allegedly manipulating the price of Knowledge House Inc. shares over an 18 month period in 2000 and 2001. An extensive R.C.M.P. investigation commenced in 2003 with the assistance of an expert (Evans). Evans' 2010 report supported the Crown's theory and he would be a critical Crown witness at trial. The accused sought Crown disclosure of two drafts of Evans' report and an unredacted copy of an electronic Task 335 folder, which contained all R.C.M.P. discussions with Evans and any materials forwarded to him. The Crown claimed solicitor-client and litigation privilege respecting the redacted portions of the folder. The accused also sought particulars of the alleged offences to ensure that they would be able to make full answer and defence.

The Nova Scotia Supreme Court, in a judgment reported (2012), 319 N.S.R.(2d) 384; 1010 A.P.R. 384, ordered that the Crown disclose the two draft reports and the unredacted copy of the Task 335 folder. The court declined to order further particulars, other than ordering the Crown to advise the accused whether they intended to lead evidence from other conspirators beyond the 13 identified. One of the accused (Colpitts) applied for an order that the Crown breached its duty under R. v. McNeil (SCC) to make reasonable inquiries respecting relevant material known to be in the possession of the Nova Scotia Securities Commission and to attempt to obtain those materials. Colpitts sought disclosure or, alternatively, access to the materials.

The Nova Scotia Supreme Court, in a judgment reported (2013), 344 N.S.R.(2d) 10; 1089 A.P.R. 10, held that the Crown breached its McNeil obligation. Since Colpitts already had the materials (but was precluded by court order from accessing them), the appropriate order was to permit Colpitts access to the materials. Colpitts now applied for disclosure of all e- mails/correspondence between the Crown and the Securities Commission after the date the indictment was preferred. The Crown, which possessed the information, had declined to disclose it on the ground that the communications were not relevant.

The Nova Scotia Supreme Court, in a judgment reported (2014), 349 N.S.R.(2d) 352; 1101 A.P.R. 352, ordered that the e-mails/correspondence be disclosed. Given the previous McNeil application, there was a reasonable possibility that the e-mails/correspondence contained relevant information. The Crown's bald statement that the information was irrelevant was an assertion only. The court was satisfied that the information could reasonably assist all of the accused in advancing a defence or defining their trial strategy. The accused applied to have the judge recuse himself, alleging both actual bias and a reasonable apprehension of bias based on remarks made in two case management conferences and in the prior decision on third party production (i.e., unable to adjudicate the matter impartially).

The Nova Scotia Supreme Court, in a judgment reported (2014), 353 N.S.R.(2d) 355; 1115 A.P.R. 355, dismissed the recusal application. Colpitts then brought an O'Connor application for the Securities Commission to disclose third party documents for which privilege was claimed. Of the 19 third parties given notice, only one (National Bank) responded by advising that it had a possible interest in 125 of the thousands of documents. A hearing was held to determine which of the documents were privileged. Once the privilege issue was resolved, the court would then determine the "likely relevance" of the remaining non-privileged documents as directed by O'Connor and McNeil.

The Nova Scotia Supreme Court, in a judgment reported (2015), 355 N.S.R.(2d) 227; 1123 A.P.R. 227, determined which documents were privileged. Now at issue was the "likely relevance" of the non-privileged documents.

The Nova Scotia Supreme Court held that the accused failed to meet the threshold onus of showing that any of the 400 documents, other than some investigator's notes, were "likely relevant".

Criminal Law - Topic 129

General principles - Rights of accused - Right to discovery or production (disclosure) - [See Criminal Law - Topic 5372 ].

Criminal Law - Topic 4505

Procedure - Trial - Special duties of Crown - Duty to disclose evidence prior to trial - [See Criminal Law - Topic 5372 ].

Criminal Law - Topic 5372

Evidence and witnesses - Documents and reports - Documents in possession of third parties - The accused were charged with fraud and conspiracy to commit fraud for allegedly manipulating the price of Knowledge House Inc. shares - At issue was the production of 400 non-privileged regulatory documents applying the "likely relevant" test in O'Connor and McNeil (SCC) - The Nova Scotia Supreme Court stated that likely relevance meant that there was a "reasonable possibility that the information is logically probative to an issue at trial or the competence of a witness to testify" - While establishing "likely relevance" was a significant burden, it was not an onerous burden - An accused could not be required, as a condition to obtaining information that might assist in making full answer and defence "to demonstrate the specific use to which they might put information which they have never seen" - If "likely relevance" was established, then "the accused's right to make full answer and defence will, with few exceptions, tip the balance in favour of allowing the application for production" - The court held that the accused failed to meet the threshold onus of showing that any of the 400 documents, other than some investigator's notes, were "likely relevant" - See paragraphs 26 to 55.

Cases Noticed:

R. v. O'Connor (H.P.), [1995] 4 S.C.R. 411; 191 N.R. 1; 68 B.C.A.C. 1; 112 W.A.C. 1, refd to. [para. 27].

R. v. McNeil (L.), [2009] 1 S.C.R. 66; 383 N.R. 1; 246 O.A.C. 154; 2009 SCC 3, refd to. [para. 33].

R. v. Williams (G.F.J.) (1994), 130 N.S.R.(2d) 8; 367 A.P.R. 8 (S.C.), refd to. [para. 37].

R. v. Levin (A.) (2012), 549 A.R. 219; 2012 ABQB 736, refd to. [para. 39].

R. v. W.B. (2000), 134 O.A.C. 1 (C.A.), refd to. [para. 39].

R. v. Arsenault (J.) (1994), 153 N.B.R.(2d) 81; 392 A.P.R. 81 (C.A.), refd to. [para. 45].

R. v. Gebrekirstos, 2013 ONCJ 265, refd to. [para. 46].

R. v. Sipes (D.G.), [2011] B.C.T.C. Uned. 150; 2011 BCSC 150, refd to. [para. 45].

R. v. Basi (U.S.) et al., [2009] B.C.T.C. Uned. 1033; 2009 BCSC 1033, refd to. [para. 48].

R. v. Basi (U.S.) et al., [2009] B.C.T.C. Uned. 1339; 2009 BCSC 1339, refd to. [para. 48].

R. v. Ahmed, [2009] O.J. No. 6159, refd to. [para. 49].

R. v. Alizadeh, 2013 ONSC 5417, refd to. [para. 49].

R. v. Cater (K.) (2014), 349 N.S.R.(2d) 225; 1101 A.P.R. 225; 2014 NSCA 74, refd to. [para. 50].

Counsel:

James Martin, Mark Covan and Scott Millar, for the Crown;

Barry Whynot, for Bruce Clarke;

Tyler Hodgson, for R. Blois Colpitts;

Daniel Potter, self-represented;

Edward Gores, Q.C., for Nova Scotia Securities Commission;

David Coles, Q.C., and Geoffrey Franklin, for National Bank Financial Ltd.

This matter was heard on February 18-20, 2015, at Halifax, N.S., before Coady, J., of the Nova Scotia Supreme Court, who delivered the following judgment on February 27, 2015.