Too Much Information!

AuthorMalcolm Mercer
DateJanuary 08, 2015

Discussions of legal ethics and protection of information often don’t distinguish between confidential information and privileged information. The seminal case of Macdonald Estate v. Martin[i] provides a good example. As Justice Sopinka put it:

Typically, these cases require two questions to be answered: (1) Did the lawyer receive confidential information attributable to a solicitor and client relationship relevant to the matter at hand? (2) Is there a risk that it will be used to the prejudice of the client?

Of course, not all confidential information received by a lawyer in the context of a solicitor and client relationship is privileged. While confidential communications between lawyer and client for the purposes of obtaining and providing legal assistance are protected by solicitor-client privilege, confidential communications with third parties are generally not.

And when Macdonald Estate was decided, the Canadian courts had not yet clearly delineated between solicitor-client privilege and litigation privilege. We now understand that confidential communications with third parties for the dominant purpose of litigation are generally protected by litigation privilege but not by solicitor-client privilege[ii].

The Canadian law of privilege is also clearer with respect to “common interest” which, in certain circumstances, permits privileged information to be shared on a confidential basis without waiver of privilege. Sharing privileged information between parties in litigation with a common interest is the obvious example but sharing privileged information with a view to completing commercial transactions is another[iii].

The Macdonald Estate principles have been applied in new circumstances over the last two decades. Macdonald Estate itself was a transferring lawyer case in which the “virus” of confidential information came with a transferring lawyer who had previously acted on the other side in ongoing litigation.

The Court of Appeal for Ontario applied the Macdonald Estate principles to acting against former clients in Chapters Inc. v. Davies, Ward & Beck LLP [iv]. In Celanese Canada Inc. v. Murray Demolition Corp.[v], a law firm was disqualified to ensure that privileged information of the opposing party improperly acquired through an Anton Pillar order was not accessed. In Stewart v. Humber River Regional Hospital[vi], the Court of Appeal for Ontario disqualified a law firm that had learned privileged information from the opposing party in litigation as a result of retaining an expert witness previously retained by the other side.

These cases demonstrate that what is in...

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