)

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REMEDIES RELATING TODISCLOSURE OF DOCUMENTS

These materials were prepared by Robert Kennedy,QC, of Halyk Kennedy Knox law firm Saskatoon,Saskatchewan and Michael Tomka of Olive Waller Zinkhan.& Waller law finn Regina, Saskatchewan forthe Saskatchewan Legal Education Society Inc. seminar, Production of Documents; May 2003.

)

REMEDIES RELATING TO DISCLOSURE OF DOCUMENTS

ROBERTG. KENNEDY, Q.c. -SaskatoonMICHAEL TOMKA - Regina

I. INTRODUCTION

The proper disclosure of documents is a fundamental principle in civil litigation cases. The

disclosure obligation imposes a duty on us as lawyers to disclose all the documents that are in our

client's possession, custody or control, if those documents are relevant to the areas of contention

between the parties as specified and identified in the pleadings. The governing rules outlining that

duty are found in Part 20 of The Queen's Bench Rules ofSaskatchewan, specifically, Rules 212

through 221.

Our portion of the Seminar will look at the remedies available in the following situations:

1. Where there are relevant documents that exist that you know the other side is not

producing and that there is something in a proactive sense that you can do about it;

2. Where the description of documents III opposing counsel's Statement as to

Documents is inadequate;

3. Where the opposing party has used disclosed documents for a purpose other than the

litigation in which they were disclosed,

4. Where documents have been altered or destroyed,

5. Where disclosure is made for the first time at trial.

The most likely reality is that you won't know about documents that are not included in the

2

Statement ofDocuments (at least prior to Examinations for Discovery) and ifyou do, the other side

will normally voluntarily produce them to you, either at your request, or on your formal demand.

While you may think that this is naive optimism on our part, it seems to us that the bulk ofour topic

revolves around a discussion of Rule 215. This rule almost assumes an honest and forthright

disclosure ofall relevant documents - irrespective ofwhether they help or hurt the party's case. The

rule is only engaged after pleadings have closed and after all parties have produced their Statement

as to Documents under Rule 212.

At this stage of the litigation the opposite party will generally be represented and the opposing

lawyer will generally understand the production obligation. Any dispute about documents will

generally revolve around:

a. Relevancy to the pleadings (given the broader test ofrelevancy at an Examination for

Discovery);

b. Privilege, whether solicitor-client or, more likely, litigation privilege;

c. The concept of what documents are "within the control" of the party.

The basic message is that any application under Rule 215 is likely to be an application that is quite

narrowly circumscribed by agreement. The implication is that there is no longer any issue about

whether the documents exist or about the appropriate remedy to be applied in the circumstances.

Where you know that some documents exist before or at the time you prepare your Claim or

Defence, and have a realistic fear that the other party (but not, we trust, the other party's solicitor)

will modify or destroy the documents, the best proactive remedy is an Anton Pillar order, a topic

which is outside ofthe scope ofour session and has already been ably addressed by Brian Scherman.

Moreover many of the other subsidiary issues within Rule 215 have also been reviewed by other

speakers - relevance and production from third parties (by Rick Danyliuk), production orders from

3

third parties (by Reg Watson) and privilege (by Bob Leurer).

From a practical perspective this seems to leave us to provide a general overview of Rule 215

including when such an application may be beneficial, together with a discussion about the implied

undertaking rule and the present status of the spoliation doctrine in Canadian Law.

II. RULE 215

Rule 215 states as follows:

"215. (1) If any party:

(a) neglects, refuses or objects to make discovery of documents asrequired by Rule 212; or

(b) has filed and served a statement pursuant to Rule 212 whichstatement is not satisfactory to a party entitled to be served withsame; or

(c) shall in such statement so filed and served have made a claim toprivilege in respect of documents referred to therein; or

(d) having been served with a notice under Rule 213 shall neglect orrefuse to produce any documents mentioned therein; or

(e) neglects to give notice to inspect or having given such noticeneglects or refuses to produce such documents for inspection orto permit the solicitor for the other party to make copies thereofor to furnish such solicitor with copies thereof upon payment ortender of the proper fees in connection therewith; or

(f) offers production at a place elsewhere than the address for serviceexcept as otherwise provided;

then the party so desiring production may apply to the court for an orderrequiring the other party to make production ofdocuments or for furtheror better production or for inspection or determining whether documentsin respect ofwhich privilege is claimed are in fact privileged and uponsuch application the court may make an order for production orinspection in such mariner as may be just.

(2) If upon such application any privilege is claimed for any document thecourt may inspect such document for the purpose of deciding as to the

4

validity of the claim for privilege and to consider all relevant evidencewhich may be adduced tending to establish or destroy such claim forprivilege.

(3) Upon any application under this rule the court may permit cross­examination under oath of a party upon the original or any subsequentstatement given pursuant to Rule 212.

A. TIMING OF THE RULE 215 APPLICATION

The Rules, together with the case law, make it clear that the full ambit ofthe "production" obligation

exists under Part 20 ofthe Rules (Discovery and Inspection ofDocuments) and that the production

is to take place prior to - and not at - the Examination for Discovery stage.

Popowich v. Saskatchewan, [1996] 8 W.W.R. 609, 144 Sask R. 166 (C.A.).

Our experience, in practice, is that counsel ignore this strict timing requirement, at least to the extent

of handling some aspects of the production process through undertakings at the Examination for

Discovery.

For example, if the claim is one for economic loss to a corporation, Financial Statements and

possibly Income Tax records will invariably be a part of the document production process but the

underlying source documents, general ledgers and the like, will not. To the extent that a particular

aspect of your Claim or Defence does engage some forensic accounting review of the source

documents this probably won't come up until the Examination for Discovery itself. As such it will

be handled by way of undertaking with a reservation to hold further discoveries if required.

If the issue of further production is pursued at the discovery stage and if the other side refuses to

produce then the refusal will set the stage for the application under Rule 215 (and/or a "refusal to

answer" application under Rule 231).

5

If you know the issue is there from the outset and don't want to wait until the Examination for

Discovery (or if the litigation is such that it will not be cost effective to do document discovery at

the Examinations because ofthe possibility ofmultiple discoveries over an extended period oftime),

then you should take steps to obtain full disclosure in advance ofDiscoveries under the production

rules. If you know that there are relevant documents that must exist but are not included in the

Statement as to Documents then you should make a demand for a further and better Statement as to

Documents. This will usually give you access to the documents that you wish, failing which you

are entitled to make the application pursuant to Rule 215. Ifyou don't make the demand, however,

the case law indicates that you are not entitled to make the application (see Foulds v. Knox (1994),

31 C.P.C. (3rd) 4 (Sask. Q.B.W.

In certain circumstances and with respect to certain types ofcases it may be that you will want access

to the original documents or to the original file, or filing system, of the opposite party.2

The case is cited in Neva McKeague's annotated Rules under Rule 213. Rather then re-invent the wheel- orin the case ofNeva's rules re-inventing the entire train - we simply refer you to the annotations for an in-depthreview of the relevant Saskatchewan case law.

2

R. v. Foster and Walton-Ball (1982), 17 Sask.R. 37 (C.A.) was a criminal prosecution for perjury against twoindividuals who fabricated a commercial contract with the intention of defrauding their employer. Counselfor the employer was aware ofthe situation prior to the discovery because the letterhead that was used did notexist at the time that the two individuals supposedly executed the "no cut - golden parachute" employmentcontract. It was necessary in these circumstances to have the original "contract" entered as an exhibit at thediscovery rather then the copy which was in the other party's production.In professional malpractice litigation you occasionally run across situations where copies ofthe solicitor's fileor copies ofthe hospital medical records show pages with interlineations, different handwriting or cut and pastedocumentation and in order to completely explore the provenance ofthe documents it will be necessary to seethe originals.If the action involves multiple documents, in multiple files then you could conceivably require access to the"filing system", "filing methodology", and the "internal record keeping structure" of the other party. Wherea particular document is found in relation to other documents may be just as important as the information inthe document itself. While it may be argued that the filing system is not a "device" within Rule 211, on theother hand, where the file storage system is important, the chances are that the original documents remain withthe other party and you will likely be able to take advantage ofthe inspection procedure under Rule 212(4).

6

B. OTHER SITUATION S WHEN A RULE 215 APPLICATION MAY BE USEFUL

1. Inadequate Description of Documents

An application under Rule 215 may also be appropriate where a Statement as to Documents

inadequately describes the documents contained therein. Far too often counsel serve a Statement

as to Documents that is inadequate with respect to the description ofdocuments they have disclosed

and are willing to produce, or is inadequate with respect to the description of those documents that

fall within the privileged section.

Generally, the proper method of describing disclosed documents requires that the documents are

identified by:

(i) The date;

(ii) The author and addressee if a letter; and

(iii) The nature of the document if other than a letter.

Bank o/Montreal v. 3D Properties (No.1) (1993), 111 Sask. R. 53 (Q.B.).

In the average litigation file where there are relatively few documents, the description of those

documents and the accuracy ofsuch description may not raise any concern. However, the adequacy

ofthe description ofdocuments becomes increasingly important in large, complex mega- files where

each party discloses thousands of documents.

We are aware of a recent mega-file where the Defendants were served with a Statement of

Documents disclosing in excess of3,000 documents. The difficulty that counsel for"the Defendants

faced was that the majority of the documents were described in very general terms making it

impossible to determine the contents or the nature ofthe documents. Due to the refusal ofPlaintiffs

counsel to provide a better description of their documents an application under Rule 215 and 212

)

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was made. Eventually, the Plaintiffs consented to providing better descriptions. Defendant's counsel

saw the obvious benefit ofhaving an inadequate description ofdocuments in a mega file because the

Statement of Documents is the starting block for preparation for Discovery. Without a clear

description ofthe Documents counsel started out at a significant disadvantage. Indeed, without that

initial starting block counsel may find themselves spinning their wheels, wasting significant time

and client resources searching for needles in haystacks.

However, apart from its benefits in the context of a mega file, a Rule 215 application requesting a

better description of documents most likely will be useful when there are issues regarding the

privileged section of opposing counsel's Statements as to Documents. In our experience, the vast

majority of Statement as to Documents have a privileged section that merely contains a number of

useless boiler-plate clauses. For example:

"THE SECOND PART THEREOF: Showing documents in the possession of theDefendant (Plaintiff) which he objects to produce.

1. Correspondence, notes, memoranda of solicitors and counsel made for thepurpose ofthis litigation, and all documents collected for the same purpose;

2. Correspondence and memoranda recording communications between solicitorand client made with reference to this litigation, or to enable the client toobtain or the solicitor and counsel to give advice; .

3. Correspondence and memoranda recording communication between solicitorsand third persons with reference to this litigation, or to enable solicitors togive legal advice;

4. Correspondence and memoranda recording communications between clientand third persons with reference to this litigation, or made for the purpose ofobtaining legal advice."

Contrary to the common practice ofusing boiler-plate clauses to describe privileged documents, the

degree ofdescription that is required under the privileged section ofthe Statement as to Documents

is somewhat more involved.

8

In the Schlechter v. Schlechter (1989) 73 Sask. R. 13 case, Mr. Justice G.A.F. Maurice commented

upon the degree ofdetail required in the description of the privileged section ofthe Statement as to

Documents at p. 14:

"The description thus provided can be characterized as legal "boiler-plate" fromwhich it is impossible to determine with reasonable certainty what documents arebeing referred to. What amounts to a sufficient description of documents will varyfrom case to case. However, the comments of Master Donkin in BramptonEngineering Inc. v. Alros Products Ltd, 8 C.P.C. (2d) 48, at p. 52 are apposite:

It, therefore, appears to me that for each category of document (Le.,letters from the client to the solicitor, letters from the solicitor to theclient, photographs, reports, statement, memoranda, etc.) there shouldbe a separate description. In each case the sender ofthe document orthe creator of the photograph or report should be identified and theperson to whom it was sent or the person for whom it was preparedshould be identified. Each should be given either by listing all thedates of documents falling within a certain category or at least bygiving the first date. Depending on the type ofdocument and whetherthe first date is after or before the action started it might not benecessary to give all the dates ofall the correspondence or reports orphotographs if the giving of the first date would make it reasonablyapparent that the document was privileged. Needless to say ifa letterof a recent date enclosed a document of a different date the seconddocument should not be 'hidden' by use of a phrase such as 'andenclosures' .

The grounds for the claim of privilege should also be set out under eachcategory document."

Obviously, in light of Mr. Justice Maurice's comments in the Schlechter case, the boiler-plate

technique is an inadequate way to complete theprivileged section ofthe Statement as to Documents.

In our experience, counsel's insistence on a current and proper privileged section in the Statement

as to Documents can result in significant benefits, as it may uncover avenues of inquiry not

previously considered that may useful during the course of discovery or trial. We suggest that a

careful analysis ofan opposing party's claim for privilege should be made at various stages of the

action. Indeed, if opposing counsel has failed to properly describe documents in the privileged

9

portion of the Statement as to Documents and refuses to do so, consideration should be given to

using a Rule 215 application to remedy the situation.

As outlined in the Introduction, because the issues canvassed in this paper exclude the more

aggressive ex parte procedures like Anton Pillar orders, our topic is somewhat prosaic if not

mundane. We say this notwithstanding your ability to have the other party committed for contempt

pursuant to Rule 217(2), and to do likewise to the opposing counsel under Rule 221. However,we

are not aware ofany modem case that has ever imposed civil contempt sanctions. Rather, the usual

order would be to strike the pleading under Rule 217 or make a pre-emptive order under Rule 218

denying the other party's ability to use some positive piece of evidence in the litigation.

III. THE IMPLIED UNDERTAKING RULE

1. What is the implied undertaking rule?

The Saskatchewan Court ofAppeal explained the infamous implied undertaking rule in the Laxton

Holdings Ltd. v. Non-Marine Underwriters, Lloyd's, London, [1987] S.J. No. 131, 56 Sask R. 152

case. In the Laxton Holdings case, Sherstobitoff J.A. described the rule in the following terms:

"...The practice here has been similar to the rule in England where a solicitor, whoin the course of discovery in litigation obtains possession of documents, gives animplied undertaking to the Court not to use those documents, or allow them to beused, for any other purpose than the proper conduct of the action on behalf of hisclient..."

Recently, Klebuc J. has explained that under the common law, alitigant and his/ her counsel are

bound by an implied undertaking not to use any document obtained during Discovery for a

"collateral or ulterior purpose".

10

Ormiston v. Matrix Financial Corp., [2002] S.J. No. 383, at para. 7 (Q.B.)(Q.L.)

The term "collateral or ulterior purpose" was described by the House of Lords in Home Office v.

Harman, [1982] 1 All E.R. 532 (Lord Diplock) as " ...some purpose differentfrom that which was

the only reason why, under a procedure designed to achieve justice in civil actions, she was

accordedthe advantage, which she wouldnototherwise havehad, ofhaving in herpossession copies

ofother people's documents..."

Duke v. Vervaeck, [2000] S.J. No. 591 at para. 26 (Q.B.; Klebuc, J.)(Q.L.).

Significantly, the implied undertaking rule also applies to answers given to questions during the

Examination for Discovery. Such information shall be used strictly for the litigation at hand and no

other purpose.

Wasylyshen v. CBC and Neil (1989), 73 Sask. R. 295 at 308 (C.A.)

2. What is the Remedy for Breach of the Implied Undertaking Rule?

(i) Saskatchewan

In researching the implied undertaking rule, we found no reported cases in Saskatchewan involving

applications where one party was seeking the remedy arising out ofthe other party's alleged breach

of the implied undertaking rule.

The Saskatchewan cases which discuss the implied undertaking rule are found in the context of

applications for an order granting leave to amend pleadings to include a counterclaim (Duke); an

application for a stay of the civil proceeding pending the outcome ofcriminal charges (Laxton); an

application to permit a non-parties to be present during discoveries to assist counsel (Ormiston); an

application to compel disclosure of the identity of sources (Wasylyshen); and an application to

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compel parties to answer questions and/or disclose documents during discoveries (Board of

Education ofSaskatoon West School Division No. 42 v. J.A. andJ.s. (1997), 160 Sask. R. 126 at 140

(Q.B.: Wright J.) and Phaneuf Fertilizer Sales Ltd. v. LeBlanc, [1987] SJ. No. 595 (Q.B.:

Hrabinsky, 1. )(Q.L.).

That being said, the Saskatchewan courts have confirmed that a breach of an implied undertaking

rule is civil contempt of court.

Laxton Holdings Ltd., supra p.3

Furthermore, Wright 1. in the Board ofEducation case, supra, went so far as to say that any breach

of an implied undertaking rule is in contempt of the court "by the solicitor himself' (p.140).

Therefore, in Saskatchewan, litigants and their counsel should be aware that if the implied

undertaking rule is breached, a court application citing civil contempt ofcourt may be made. (while

uncommon).

(a) Other Jurisdictions

We have conducted some cursory research ofthe implied undertaking rule in otherjurisdictions, and

found the following cases that may be of assistance to you on the issue of possible remedies:

(i) Ontario

Note the implied undertaking rule does exist in Ontario as per the Goodman v. Rossi, [1995] O.J.

No. 1906 (Morden, A.C.J.O.) case. The Goodman case involved a plaintiff pursuing an action for

wrongful dismissal, who in the course of the discoveries in that action obtained an unfavourable

report discussing her conduct while employed by her former employer. The plaintiff sought to rely

on that report as the basis to commence an action against Rossi for defamation. The defendant

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(Rossi) applied for summary judgment dismissing the plaintiffs defamation action, or alternatively

sought an order permanently staying the action on the basis that the claim was based on evidence

obtained by the plaintiff in the wrongful dismissal action. The defendant was successful in having

the plaintiffs action stayed.

The Ontario Court ofAppeal made the following comments with respect to the possible remedies

available for breach of the implied undertaking rule at p. 10:

"I think that there would be a serious gap in the range of possible sanctions forbreach of the obligation not to make improper use of documents disclosed ondiscovery, if it were not associated with an implied undertaking to the court and,therefore, capable of giving rise to a contempt of court order. In many cases,depending on how the issue arises, other remedies may be more appropriate, such asan injunction, before any improper use has occurred, or, as in this case, a motion tostay or dismiss a proceeding. In some cases, however, for example, where the breachhas occurred and there is no other appropriate remedy, contempt proceedings may bethe only avenue...." [Emphasis added].

Seemingly in Ontario the courts have recognized a wide range of sanctions available, including

costs and contempt.

Gleadow v. Nomura Canada Inc., [1996] O.J. No. 668 at para .16 (OCJ Gen. Div.;Kiteley, J.)(Q.L.).

Where the defendant produced documents· to the plaintiff which the plaintiff then gave to other

persons and which subsequently appeared in affidavits ofthose persons in an action commenced by

them against the defendant, the court held that the plaintiff breached the implied undertaking rule

by furnishing the documents to the other persons. The plaintiff was in contempt of court - the

appropriate penalty was an order of costs of the motion and appeal on a solicitor and client basis.

Orfus Realty v. D.G. Jewellry of Canada Ltd., [1995] O.J. No. 1905 (C.A.; Morden,A.C.J.O.)(Q.L.).

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(ii.) Alberta

In Ochitwa v. Bombino, [1997] A.J. No. 1157 (Q.B.; Coutu, J.)(Q.L.) the plaintiff commenced a

wrongful dismissal action against her employer. During discoveries in that action she learned the

identity of the defendants who had made verbal and written complaints about her, and the plaintiff

then commenced an action against the defendants for defamation and conspiracy to cause mental

suffering. The defendants applied for a stay of the plaintiff s action, or for an order striking the

claim, or for summary judgment. The defendants' application was dismissed.

The court explained, inter alia, that it is within its inherent jurisdiction to control its own practice

and therefore a court can grant an order to remove a document or other evidence in whole or in part

from the implied undertaking. The test for granting relief from the obligation imposed under the

implied undertaking rule is that the court will tolerate some injustice caused to the discovered party

if it is outweighed by a greater injustice to the discovering party ifhe/she could not make use ofthe

discovered documents (p.8 Q.L.Report).

(iii.) Nova Scotia

InSezerman v. You/e, [1995] N.S.J. No. 525 (N.S.S.C.; Gruchy, 1.) the plaintiffused documents and

information from the discovery transcript to commence a defamation action against the defendant.

The defendant applied for a stay of the plaintiff s action and was successful. The court found that

the breach of the implied undertaking rule was unintentional in this case and therefore a finding of

contempt was not warranted.

IV. SPOLIATION

In instances where documents or for that matter physical evidence, (see in this respect the inspection

procedure under Rule 390 which conceivably applies to documents as well) have been altered or

destroyed you may well want to consider the spoliation issue. As you may be aware, "Spoliation"

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refers to the intentional or reckless destruction of evidence.

In Canadian law you will find that destruction ofevidence or documents is traditionally viewed as

an evidentiary issue which questions whether an adverse inference should be drawn against the party

who had and then destroyed the evidence (documents) 3.

The spoliation doctrine in the United States has a long history and in fact has achieved the status of

an independent tort in addition to being grounds for the dismissal of a claim or the striking of a

defence.

These trends may well be making their way into Canada.4

The doctrine ofspoliation has recently emerged as a hot topic in courts across Canada. However, an

agreement as to what the doctrine of spoliation entails has yet been arrived at in Canada.

As mentioned, the conventional approach is to see the doctrine as an evidentiary presumption. Ifone

party destroys evidence, some courts will invoke spoliation to presume the worst of the spoliator.

For example the court might presume that the missing document indicated negligence on the part

of the spoliator. Other courts, use spoliation as a basis for the exclusion of evidence. In this

situation, the court normally would exclude any testimony that relies upon the destroyed evidence.

3

For relatively comprehensive discussion of the spoliation doctrine in Canada see the Article "IntentionalDestruction of Evidence: Why Procedural Remedies are Insufficient" (1999) 78 C.B.R. 38.

4

See for example Cheung v. Toyota Canada Inc., [2003] O.J. 411 (S.C.). Toyota was sued concerning a vehicleaccident and the vehicle was examined and partially destroyed before Toyota had any notice ofthe accidentor the claim. Once the claim had been made Toyota applied for a preservation order which was granted andsubsequently it appeared that the preservation order had been breached. The Court discussed the appropriateremedy and ultimately makes an order that the plaintiff was "precluded from adducing or relying on anyreports or other evidence to the extent that it relates to or is in any manner based upon the missing tires". Theactual remedy granted has obvious parallels, in the documents context, to an order under Rule 218 althoughthis is generally made by the trial judge rather then at an interlocutory stage. Where however a document hasbeen altered or destroyed "after the fact" it is theoretically possible to obtain a pre-emptive order denying theother party's ability to use the altered material in evidence.

15

Still other courts will allow other types ofevidence-such as parol evidence that would not otherwise

be allowed. The rationale is that the rules of evidence should be relaxed when crucial pieces of

evidence have been destroyed.

However, the spoliation doctrine in the United States has a longer and more developed history than

as seen in Canada and has, in fact, achieved the status ofan independent tort. The tort of spoliation

allows a person to sue when evidence relevant to pending or probable litigation is destroyed causing

irreparable prejudice to the person. In fact, in American jurisdictions the debate is not whether there

is an independent tort of spoliation but whether the tort should refer only to the intentional

destruction of evidence or whether it might also include a negligent destruction of evidence.

In Canada, the existence ofan independent tort of spoliation is unclear. To date, we are unaware of

any Canadian plaintiff succeeding in suing for spoliation, though the question remains open.

At present, there appears to be two schools of thought relating to whether one can sue based upon

spoliation. The first school of thought has its basis in British Columbia arises out of the case of

Endean v. Canadian Red Cross Society (1998),48 B.C.L.R. (3d) 90, [1998] 9 W.W.R. 136 (C.A.).

In the Endean case the B.C. Court of Appeal determined that "spoliation" could not stand as a

separate cause of action. The case involved a proposed class action by individuals affected with

hepatitisC through blood transfusions, the plaintiffs alleged that the Canadian Blood Committee had

intentionally destroyed relevant evidence, which prejudiced their ability to pursue the action. At the

certification stage, an argument was made that the class action should be struck simply for novelty.

Smith J. at the motion for certification relied on the principle that cause of action should not be

struck simply for a novelty and allowed it to continue. On appeal, however, Braidwood J.A. insisted

that spoliation "is an evidentiary rule which raises a presumption - not an independent tort".

Interestingly enough, the Court ofAppeal unanimously held that "An actionfor damages... is not an

appropriate response to destruction of evidence." Where documents have been intentionally

) destroyed, the court held that presumption in favour of the injured party will assist the party in a

16

claim based on the accepted underlying cause of action.

Although the Supreme Court of Canada did grant a leave to appeal in Endean, the appeal was

discontinued. As a result, the Supreme Court ofCanada has not had the opportunity to definitively

deal with the issue.

The other school of thought, suggesting that an tort of spoliation does exist arises out of Ontario.

In Ontario there seems to be a distinct trend of acceptance of the independent tort of spoliation.

Perhaps the leading case, at present, is a decision of the Ontario Court ofAppeal which refused to

strike a Statement of Claim which asserted the independent tort of spoliation. Spasic Estate v.

Imperial Tobacco Ltd. (2000), 188 D.L.R. (4th), 577 (O.C.A.) involved an action by an estate

against a tobacco company and involved an allegation that a tobacco company had destroyed

documents in evidence which would have established the causal link between smoking and cancer.

A further example of the acceptance of a tort of spoliation is seen in Coriale (Litigation Guardian

of) v. Sisters ofSt. Joseph (1998), 41 O.R. (3d), 347 (Gen. Div.). In Coriale, the Ontario Court

(General Division) had to make a ruling in relation to a pleading ofspoliation. In the Coriale case,

the plaintiffalleged a medical malpractice. After commencing the action, the plaintiffs discovered

that relevant documents were missing or destroyed. They moved before a Master to amend their

Statement ofClaim and to plead spoliation both as an evidentiary principle and as a tort. The Master

allowed the motion, and on appeal Justice Malloy agreed.

The court came to three conclusions relating to pleading spoliation. First, it held: "The pleading of

the principle is clearly tenable at law..." that is like other evidentiary principles (Res ipsa loquitur

springs to mind). It is correct to plead the principle.

Secondly, the court considered pleading spoliation as an independent cause of action. Malloy, J.

reasoned that it would be unfair to determine whether spoliation is a valid cause of action on a

motion to amend the pleadings. Spoliation is not "clearly untenable" or destined to fail. Therefore,

17

it should not be struck out at that particular stage.

The third conclusion in Coriale touched briefly on the question of particulars. Like a claim of

conspiracy, an allegation ofspoliation risks being oppressive for a plaintiff, who is asked to provide

details of facts that are within the tortfeasor's knowledge. Therefore, on a motion to amend

pleadings, "the requirementfor particulars should not be so onerous..."

In Saskatchewan, our Court of Appeal in Doust v. Schatz, [2002] SJ. No. 674 (Q.L.), referred to,

apparently with approval, the case ofSpasic Estate v. Imperial Tobacco Ltd. Although the court of

appeal's reference to this case is obviously not clearly indicative that a tort ofspoliation is accepted

in Saskatchewan, it seemly does open the door to such a claim.

Significantly, Justice Tallis' comments in Doust on the spoliation issue also engages the basic and

fundamental issues ofdisclosure under the Rules. At paragraphs 26 through 29 Justice Tallis states,

"26 These documents which were left at the farm were never produced by Mr.Schatz. Ms. Doust was not allowed on the farm premises after their separation so itwould be impossible for her to produce them. These documents were not includedin the order of December 7, 1998 which provided for delivery of specific personaleffects to her.

27 The integrity ofthe administration ofjustice in both civil and criminal mattersdepends in a large part on the honesty ofparties and witnesses. Spoliation ofrelevantdocuments is a serious matter. Our system of disclosure and production ofdocuments in civil actions contemplates that relevant documents will be preservedand produced in accordance with the requirements of the law: see for exampleLivesey v. Jenkins, [1985] 1 All E.R. 106 (H.L.), Ewing v. Ewing (No.1) (1987), 56Sask. R. 260, Ewing v. Ewing (No.2 (1987),56 Sask. R. 263, c.A.), Vagi v. Peters,Rozen v. Rozen, [2002] B.C.J., No. 2192. A party is under a duty to preserve whathe knows, or reasonably should know, is relevant in an action. The process ofdiscovery ofdocuments in a civil action is central to the conduct ofa fair trial and thedestruction of relevant documents undermines the prospect of a fair trial.

28 Given the nature of the controversy over the number of mares at the relevanttime, Mr. Schatz with his length of experience in the PMU business clearlyunderstood the importance of preserving relevant records for use on discovery and

18

at trial. In this case his failure to preserve and produce the relevant records hamperedthe trial process. A great deal of time was spent in the examination and crossexamination of the parties with respect to this issue.

29 The question whether the intentional spoliation ofevidence is a separate tort isnot before us in this litigation: see Spasic v. Imperial Tobacco Ltd. (2000), 188D.L.R. (4th) 577 O.C.A.). It is open to a trial judge to impose sanctions or draw anadverse inference from such conduct. In this case· it was clearly open to the trialjudge to take this conduct into account when considering matters of reliability,credibility and costs."

As the decisions out of British Columbia and Ontario as well as here in Saskatchewan indicate, at

present there is no clear answer as to whether a tort of spoliation exists in Canada. Clearly, this is

an issue that is ripe to be brought to the Supreme Court of Canada for resolution.

That being said, counsel should remember that the principle of spoliation as an evidentiary

presumption still exists. Indeed the discussion of spoliation in the Doust v. Schatz case here in

Saskatchewan appears to reaffirm the doctrine of spoliation as an evidentiary principle.

v. RULE 218

A further remedy available when a party does not make full or adequate production during the course

of a lawsuit is found in Rule 218, which provides.

"218. After any party has made discovery ofdocuments or having been required tomake discovery has neglected or refused so to do, he shall not afterwards beat liberty to put any document of which he has not made discovery inevidence on his behalf in any such cause or matter unless he shall satisfy thecourt that he had some reasonable cause for not making discovery thereof; inwhich case the court may allow the same to be put in evidence on such termsas to costs or otherwise as the court shall think fit:

Provided that if any party who has made discovery of documents asby these rules provided, shall discover or come into possession ofanydocument not previously disclosed and which is relevant to thematters in question in the action or proceeding he shall give noticethereof to the opposite party not later than 10 days before the trial or

19

hearing, and forthwith upon request shall supply such opposite partywith a copy thereof, in which case the court may permit suchdocument to be given in evidence upon such terms as to costs orotherwise as may seem just."

We suggest that the strong wording of Rule 218 suggests that it could be used as an effective

strategic objection or remedy where inadequate production occurred during the course ofa lawsuit.

Although the trend in our courts is to provide litigants with a great deal of leeway, counsel should

be encouraged to more regularly object to any document which was not made available during the

course of the lawsuit.

PREPARED IN (BUT NOT NECESSARILY GUARANTEED CURRENTAS AI) MAY OF 2003.

)

Q.B. No. of2003

IN THE COURT OF QUEEN'S BENCH FOR SASKATCHEWAN

JUDICIAL CENTRE OF SASKATOON

BETWEEN:

PLAINTIFF

AND:

DEFENDANT

NOTICE OF MOTION

2

_ of the Statement of Claim;

(ii) the working papers ofthe Defendant's Accountants and Auditors concerning

the Defendant's audited financial statements for the periods __ and __

and respecting the Defendant's corporate income tax returns for 1998 and

1999;

(iii) a list of all sales which the Defendant made of any model or version of the

Plaintiffs widget mechanism between May of 1997 and May of 2000

sufficient to identify the date of the sale, the particular model or version of

the widget mechanism sold, the purchaser in the transaction and the sale

proceeds.

AND FURTHER TAKE NOTICE that the within application will be made upon the

following grounds:

1. The Plaintiffs claim seeks, inter alia, damages equal to the profits that the Defendant

made in modifying the Plaintiff s proprietary widget mechanism in ways not

authorized by the Distribution Agreement dated the __ day of and

thereafter selling the widget mechanisms, as modified, to the Defendant's customers

without accounting to the Plaintiff for the profits that were made;

2. The Defendant's document production includes certain of its financial records but

each such record is a financial summary and does not break down nor distinguish

amongst the various operating divisions ofthe Defendant company nor break down

and distinguish amongst individual sales transactions which would allow the Plaintiff

to adequately discover and inspect documents which concern:

(i) the totality of sales of the proprietary widget mechanism;

(ii) the sale ofthose widget mechanisms which were modified by the Defendant

as authorized by the Distribution Agreement;

(iii) the sale ofthose widget mechanisms which were modified by the Defendant

in breach of the Distribution Agreement. .

3. The documents and working papers in the possession ofthe Defendant's Accountants

)/

3

and Auditors are within the power and control of the Defendant in as much as the

Accountants and Auditors are the Defendant's agents within the meaning of Rule

212;

4. Counsel for the Plaintiff has demanded that the Defendant make further and better

production of documents but the Defendant has refused to make full and adequate

disclosure of documents as required by Rule 212.

AND FURTHER TAKE NOTICE that in support ofthe within application will be read the

pleadings and proceedings had and taken herein, the Affidavit of and such further and

other material as counsel may advise and this Honourable Court shall allow.

DATED at Saskatoon, in the Province of Saskatchewan, this _ day of , 2003.

PER: ----------Solicitors for the Plaintiff

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