Category: Implied Undertaking of Confidentiality

Court Rules That It Is In The “Best Interests Of Justice” To Relieve Against The Implied Undertaking Of Confidentiality

In Easton v. Chen, the Plaintiff was injured in a motor vehicle accident, and consequently advanced an ICBC claim for damages. Formal legal proceedings were commenced, and a trial date was eventually set. The Plaintiff had also been involved in four prior motor vehicle accidents, with all four ICBC claims settling before the trial of the current action.


Prior to trial, ICBC’S lawyer made an application for production of documentation from the four prior accidents, including Examination for Discovery transcripts and expert reports, on the basis that the Plaintiff’s injuries were indivisible in nature. Counsel for the Plaintiff refused to produce the documentation, thus necessitating a court application.


Counsel for the Plaintiff took the position that the Plaintiff had recovered from the injuries sustained in the prior accidents, and that the injuries were divisible in nature. As such, counsel for the Plaintiff argued that the documentation sought by ICBC’S lawyer was not relevant. Counsel for the Plaintiff took issue with the fact that ICBC’S lawyer in an amended list of documents had listed certain documentation prepared by or submitted to ICBC in the prior actions, taking the position that this breach the implied undertaking of confidentiality.


The Court, however, drew a distinction in that such documents were never subject to the implied undertaking of confidentiality, as they were not produced by the Plaintiff under the compulsion of litigation. The Court also pointed out the similarity of injuries between the case at bar, and the prior actions.


The Court would order that the documentation be produced, and that it would be in the interests of justice to relieve against the implied undertaking of confidentiality.


[23] The defendant also relies on Juman v. Doucette, 2008 SCC 8 at para. 35 and Joubarne v. Sandes, 2009 BCSC 1413 at paras. 20 – 26 in support of his position that the implied undertaking should, in any event, be lifted in cases such as this.


[24] In Joubarne, Mr. Justice Williams held:


[25] In the present case, the discoveree is the plaintiff. Furthermore, the claim in the employment litigation encompassed issues including her employment history, fitness and performance in her employment, as well as health issues that may have impacted on her performance. In the present action, the plaintiff advances claims for loss of earnings and loss of capacity. She alleges that the accident resulted in her developing a driving anxiety and depression as well as loss of enjoyment of life and permanent physical disability. There is, as well, a temporal proximity.


[26] In my view, it is reasonable to conclude that the examination for discovery transcript in the earlier proceeding is likely relevant to the issues in the personal injury action. Furthermore, in the circumstances, there is no bar at law to preclude those materials from production and the court has a discretion to relieve against the implied undertaking and to order disclosure.

Court Waives Rule Of Implied Undertaking Of Confidentiality Where Plaintiff Has Two Separate Actions With Indivisible Injuries

In Elworthy v. Tillit, the Plaintiff was injured in a motor vehicle accident, and consequently pursued an ICBC claim. The Plaintiff was later involved in an accident as a cyclist, and brought another ICBC claim. Formal litigation proceedings were commenced for both actions, with liability, causation, and quantum being issues in both.


Counsel for the Plaintiff prepared a Consent Order, attempting to have both matters consolidated into one action for trial, however counsel for the Defendant in the second action would not agree unless there was also a provision that all evidence, including transcripts from the Examination for Discovery from the first accident, be admissible for both actions. Counsel for the Plaintiff refused.


The Court was left with determining whether or not to waive the implied undertaking of confidentiality.


The rule of implied undertaking of confidentiality forbids a party who receives disclosure in a particular case from using that information against the same party in another proceeding. Consent of the parties, or a court order, can waive the rule of implied undertaking of confidentiality. In the context of ICBC injury claims, ICBC’S lawyers sometimes try to get around the rule of implied undertaking of confidentiality in the context of chronic pain cases that may last for several years, and which may overlap from a prior case to the current one.


The Court noted that the issues of causation and indivisibility of injuries were common factors between the two actions, and ordered that the transcripts from the Examination for Discovery from the first action be admissible in both actions.


[6]             The defendant Stewart led the submissions on the law with references to several common law authorities including Gill v. Gill, 2013 BCSC 2365. In that case, the court decided that the implied undertaking rule could be waived so that a transcript of the plaintiff’s examination for discovery in a Part 7 action could be used in the plaintiff’s tort action, and vice versa.


[7]             Although not precisely the same factual matrix as the case at bar, I find that the legal analysis and result in Gill v. Gill should be followed here. The same concerns raised by the plaintiff in this case were considered and rejected by the court in Gill. Here, the issues of causation and indivisible injuries provide the commonality between the actions.


[8]             The defendants differ on the language to be used in this particular case plan order. In my view, the appropriate language is that found in Peel v. Western Delta, 2003 BCSC 784 at para. 30. The order pronounced is that the evidence that is otherwise admissible and relevant, obtained at the examination for discovery in Victoria Registry action no.14-0946 (either concluded or future) will be admissible both in that action and in Victoria Registry action no. 15-2263 as if the evidence had been obtained in the other action.

Court Allows Transcript From Part 7 Action To Be Used In Tort Action

In Gill v. Gill, the Plaintiff was injured as a passenger in a motor vehicle collision, and subsequently brought an ICBC claim for damages for pain and suffering, income loss, out of pocket expenses, diminished earning capacity, and future care. Liability was denied by the Defendant. The Plaintiff also initiated a separate action against the Defendant for Part 7 benefits. Liability was again denied. ICBC’S lawyer made an application before a Master for production of an Examination for Discovery transcript regarding the Part 7 matter, in order to use this transcript in the separate tort action. The Master dismissed the application, however, on appeal, it was ordered that the transcript be allowed to be used in the tort action. The Court lifted the implied undertaking of confidentiality, giving greater weight to the public interest than the values of privacy and efficient conduct of litigation, which the implied undertaking of confidentiality is meant to protect.


[20] Ms. Simon is correct that the underlying causes of action in the Tort Action and the Part 7 Action are different. In that sense, the issues are different. She also points out, correctly, that the two actions cannot be consolidated for trial or heard together by virtue of s. 83(4) of the Insurance (Vehicle) Act, and Part 7 benefits are not to be referred to at the trial of the Tort Action. Moreover, a determination with respect to entitlement to Part 7 benefits does not bind the court in the Tort Action.

[21] However, there are, without any doubt, overlapping factual issues in the two actions, including:

(a) was Ms. Gill injured in the accident and, if so, what injuries did she sustain as a result;

(b) was Ms. Gill unable to work as a result of the injuries sustained in the accident; and

(c) has Ms. Gill incurred expenses in relation to medical and rehabilitative treatment as a result of injuries sustained in the accident.

[22] Although the causes of action are different, key factual issues will be the same in both actions. Ms. Gill must establish injury, causation and loss arising out of the same event, namely, the accident on April 5, 2009. If, in stating that “the issues are sufficiently different and discrete,” the Master was referring to factual issues in each action, then, in my opinion, the Master was clearly wrong, because many factual issues in the two actions are obviously very closely related, if not identical.

[23] Ms. Gill, as the plaintiff in both actions, can be compelled to testify in both the Tort Action and the Part 7 Action about the same factual issues, so there is no privacy issue that needs to be protected.

[24] On the other hand, there is a compelling public interest in getting at the truth. As Mr. Justice Hood observed in Scuzzy Creek Hydro & Power Inc. v. Tercon Contractors Ltd. (1998), 62 B.C.L.R. (3d) 366 (S.C.), 1998 CanLII 5684, at paragraph 22:

[I]t is the possibility of there being inconsistent statements which triggers the special reason for the production of the discovery transcript. The test over the years . . . has never been higher than “lets see what the witness had to say under oath before with regard to these or related matters”. What [the witness] has said may be relevant to the evidence [the witness] gives in the second action.

Court Considers Implied Undertaking Of Confidentiality : Orders Some Medical Reports To Be Produced

In Wright v. Thomas, the Plaintiff was injured in 2007, and brought a claim for damages. In that action, the Plaintiff introduced several medico-legal reports into evidence at trial. The Plaintiff was then injured again, and another action was initiated. Counsel for the Defendant sought to have these same reports introduced into evidence, however the Plaintiff opposed, arguing that the reports were irrelevant and that production of the reports would violate the implied undertaking of confidentiality. The Court ruled that some of the reports were to be produced, but not all at the moment.


[16]         Whether the implied undertaking rule even applies in this case might be in doubt. In Cochrane v. Heir, 2011 BCSC 477, the court ruled that a plaintiff must provide records obtained in a previous personal injury action as part of disclosure obligations under Rule 7‑1. Furthermore, one might query whether evidence disclosed at a public trial and now part of a public record is subject to the implied undertaking rule. The underlying purpose of the implied undertaking rule is to protect the privacy of an individual who is compelled to disclose certain information in the pre‑trial process.


[17]         In the case at bar, I understand that some of the reports were used at trial and thus any breach of privacy has already happened. However, this last point was not argued, so I must still determine whether the documents at issue involving the same plaintiff also concerned the same or similar issues to the case at bar.


[18]         Perhaps more to the point, I must determine whether the reports from the earlier action have a real probative value to the issues in this proceeding: see Biehl v. Strang, 2010 BCSC 1391.


[23]         In my view, in the absence of some medical evidence in support, the court should not make the leap and decide that all of the above‑described conditions fall within the same diagnostic category. In fact, the only similar or same diagnosis is the conversion disorder. Presumably the existence of this condition historically forms the factual basis for one of the defences to this action, otherwise the defendant would not be pursuing the application.


[24]         The defendant’s pleadings were not before me. It might have been helpful to have that pleading as an exhibit to an affidavit. One option for the court would be to dismiss the application with liberty to reapply upon providing such evidence. Obviously a further application will result in additional cost to one or both parties. To avoid such cost, I have instead reviewed the electronic record of this pleading, which is a matter of public record. The presumption of the plea of pre‑existing condition was confirmed.


[25]         Thus, in my view, the defendant has met the threshold test of relevancy with respect to the following reports: Dr. Rocheleau dated October 24, 2005; Dr. Rocheleau dated December 21, 2005; and Dr. Kemble dated November 28, 2005.


[26]         The other reports may be determined to be relevant at a later date if the medical opinions obtained in this matter make reference to the conditions discussed in those reports. However, I am unable to say that those reports address “same or similar issues to the case at bar”.


Implied Undertaking Of Confidentiality Survives : Not Set Aside

In Joubarne v. Sandes and Sandes, the Plaintiff was injured in a motor vehicle accident, and brought an ICBC claim for his injuries. He had been involved in previous legal proceedings, in which a medical legal report and a transcript of Examination for Discovery proceedings were produced. ICBC’S lawyer brought an application to be able to make use of  these documents from the previous proceeding in the current ICBC claim. The Plaintiff objected, relying on the rule of implied undertaking of confidentiality.


The Court cited relevant paragraphs of the Supreme Court of Canada decision in Juman :


51.       As mentioned earlier, the lawsuit against the appellant and others was settled in 2006. As a result the appellant was not required to give evidence at a civil trial; nor were her examination for discovery transcripts ever read into evidence. The transcripts remain in the hands of the parties and their lawyer. Nevertheless, the implied undertaking continues. The fact that the settlement has rendered the discovery moot does not mean the appellant’s privacy interest is also moot. The undertaking continues to bind. When an adverse party incorporates the answers or documents obtained on discovery as part of the court record at trial the undertaking is spent, but not otherwise, except by consent or court order. See Lac d’Amiante, at paras. 70 and 76; Shaw Estate v. Oldroyd, at paras. 20-22. It follows that decisions to the contrary, such as the decision of the House of Lords in Home Office v. Harman (where a narrow majority held that the implied undertaking not to disclose documents obtained on discovery continued even after the documents in question had been read aloud in open court), should not be followed in this country. The effect of the Harman decision has been reversed by a rule change in its country of origin.


53.       I would not preclude an application to vary an undertaking by a non-party on the basis of standing, although I agree with Livent Inc. v. Drabinsky that success on such an application would be unusual. What has already been said provides some illustrations of potential third party applicants. In this case the Attorney General of British Columbia, supported by the Vancouver Police, demonstrated a sufficient interest in the appellant’s transcripts to be given standing to apply. Their objective was to obtain evidence that would help explain the events under investigation, and possibly to incriminate the appellant. I think it would be quite wrong for the police to be able to take advantage of statutorily compelled testimony in civil litigation to undermine the appellant’s right to silence and the protection against self-incrimination afforded her by the criminal law. Accordingly, in my view, the present application was rightly dismissed by the chambers judge. On the other hand, a non-party engaged in other litigation with an examinee, who learns of potentially contradicting testimony by the examinee in a discovery to which that other person is not a party, would have standing to seek to obtain a modification of the implied undertaking and for the reasons given above may well succeed. Of course if the undertaking is respected by the parties to it, then non-parties will be unlikely to possess enough information to make an application for a variance in the first place that is other than a fishing expedition. But the possibility of third party applications exists, and where duly made the competing interests will have to be weighed, keeping in mind that an undertaking too readily set aside sends the [page187] message that such undertakings are unsafe to be relied upon, and will therefore not achieve their broader purpose.


The Court did not allow production of the medical legal report, and the transcript of the previous Examination for Discovery, commenting that:


[4]      I am of the view that, in the circumstances of this case, the implied undertaking survives and should not be ordered to be set aside.  On balance, the plaintiff’s privacy interest outweighs the defendants “fishing expedition” as referred to by Binnie J.A.  I am also of the view that the same must be said of the medical report of Dr. Bloch.  That report was a document created for the previous proceeding.  There is no evidence before me to indicate that it was incorporated into the record of that proceeding, in fact I am advised that the action settled before trial.  In the absence of evidence to the contrary, I would expect that such report would have been created and received subjected to a claim of privilege; there is no evidence before me as to the waiver of such privilege.  The defendants’ application for production of the discovery transcript and the medical/psychiatric report is dismissed.

Court Discusses Remedes For Breaching Rule Of Implied Undertaking Of Confidentiality

In Chonn. v. DCRS Canada Corp et al., the Court discussed the area of law with respect to possible remedies for breaching the rule of implied undertaking of confidentiality.


[55]         In Juman, under the heading “Remedies for Breach of the Implied Undertaking”, the Court said:


[29]      Breach of the undertaking may be remedied by a variety of means including a stay or dismissal of the proceeding, or striking a defence, or, in the absence of a less drastic remedy, contempt proceedings for breach of the undertaking owed to the court. See Lac d’Armiante, at para. 64, and Goodman v. Rossi (1995), 125 D.L.R. (4th) 613 (Ont. C.A.), at p. 624.


[56]         Various decisions of this court have given effect to these and additional remedies. In Glenayre Manufacturing Ltd. v. Pilot Pacific Properties Inc., 2004 BCSC 864, 133 A.C.W.S. (3d) 36, the Writ of Summons and Statement of Claim of a party who breached the implied undertaking of confidentiality was struck out. In Litton v. Braithwaite, the court prohibited the plaintiff from using documents in contravention of its implied undertaking of confidentiality. In an earlier decision, Sandbar Construction Ltd. v. Howon Industries Ltd., 58 B.C.L.R. (3d) 55, the court applied the contempt remedy to the breach of the implied undertaking.


[57]         Here the plaintiff seeks to have defendants’ counsel removed from the record. The plaintiff says the defendants’ failure to respect the implied undertaking of confidentiality attached to the plaintiff’s documents from the Earlier Actions, an obligation which was specifically brought to defence counsels’ attention, should have significant consequences attached to it in order to ensure that lawyers are mindful and respectful of their obligations. I do not agree. First, I expect that lawyers who understand the ambit and content of the implied undertaking rule and who appreciate the breadth and potential severity of the remedies available to the court to address a breach of the rule will act appropriately.


[58]         Second, I do not believe that such a severe remedy is appropriate in the circumstances of this case. Counsel for the defendants acted cautiously, and for the most part, properly. Mr. Harlos’ first step, in his letter of May 12, 2008, was to contact counsel for the plaintiff to indicate that he had materials in his possession which related to the Earlier Actions and to ascertain whether counsel for the plaintiff had any difficulty in his making use of these materials. Counsel for the plaintiff then expressly asked Mr. Harlos for a list of the documents that he had in his possession from the Earlier Actions. Mr. Harlos in turn, delivered a “Schedule of Records” listing the specific documents in question. To that point, Mr. Harlos’ conduct could not be faulted. He had simply, in response to a request, provided a description of the documents, obtained in the Earlier Actions and impressed with the implied undertaking of confidentiality, that he sought the plaintiff’s consent to use in the Current Action.


[59]         At that point counsel for the plaintiff, mindful of the admonition in Juman at para. 35 … “where discovery material in one action is sought to be used in another action with the same or similar parties and the same or similar issues, the prejudice to the examinee is virtually non-existent and leave will generally be granted” … should have consented to the use of the documents in the Current Action. When counsel for the plaintiff failed to consent, however, it was not open to the defendants to simply generate a supplemental list of documents under Rule 26 and include the materials from the Earlier Actions on that list. The outcome of the application to obtain the courts’ leave to use the documents was largely assured. Nevertheless, the plaintiff could not simply circumvent the requirement of obtaining leave from the court and move on its own initiative.


[62]         …… Mr. Harlos, upon being advised of the plaintiff’s formal position should have made the necessary application. His error in the circumstances, however, was not serious. The plaintiff has not been prejudiced by the defendants’ conduct and no specific remedy is required to address that conduct.

Court Refuses To Waive Implied Undertaking Of Confidentiality

In Chonn. v. DCRS Canada Corp et al., the Plaintiff was injured in a motor vehicle accident, and brought an ICBC claim for his injuries. He had also been involved in previous ICBC claims. In the case in question, ICBC’S lawyer had obtained documentation from previous ICBC claims, and was intending to use it in the present case. The Plaintiff objected. An application was brought by ICBC’S lawyer, and the Court refused to waive the implied undertaking of confidentiality with respect to documentation from previous ICBC claims. The Court commented on the legal principle of implied undertaking of confidentiality.


[25]         A party who has documents from earlier litigation that are impressed with the implied undertaking simply cannot make use of those documents without the concurrence of the party from whom they were obtained or leave of the court. The implied undertaking protects documents or oral discovery obtained in earlier litigation from being used for any purpose “collateral” to that litigation. Thus, the documents cannot be used for internal strategic review in subsequent litigation. They cannot be used for the purposes of drafting pleadings. They cannot be sent to counsel for the purposes of obtaining an opinion in new litigation. All of these obligations bound the named defendants in the Current Action as well as ICBC in its conduct of that litigation.


[39]         Once one recognizes that a central focus of the implied undertaking rule is to prevent the use of documents in subsequent litigation without consent or leave of the court, it is not sound to assert that Rule 26 displaces the application of the implied undertaking rule. Rule 26 is a rule of broad application and it governs virtually all civil actions. There are like provisions in most other jurisdictions. The result advanced by the defendants would significantly curtail the efficacy and ambit of the rule.


[40]         The submission of the defendants would also significantly erode both policy objectives underlying the rule. It would impair the privacy interests of the party to the earlier action who made disclosure and gave discovery evidence. It would also subvert the policy objective of encouraging parties to “provide a more complete and candid discovery” referred to in Juman at para. 26.


[41]         The intended purview of the “statutory exceptions” rule which is referenced by the Court in Juman, is limited to specific legislation which compels disclosure and which expressly overrides the privilege and/or confidentiality concerns of the holder of the information. Rule 26 does not achieve these objects. Though it requires disclosure from parties to litigation, both Rule 26(2) and the structure of Form 93 recognize the ongoing entitlement of a party to maintain a claim for privilege. While documents covered by an implied undertaking are not, strictly speaking, privileged, I believe that it would be appropriate for a party, from whom document disclosure is sought, to list those documents in its possession which are subject to an implied undertaking under part 3 of its list of documents.