Collier,
J:—This
is
an
application
by
Romeo’s
Place
Victoria
Ltd,
Romeo’s
Pizza
&
Steak
House
(Duncan)
Ltd,
Romeo’s
Pizza
&
Steak
House
Ltd,
Mil-
los
Development
Ltd,
Romeo’s
Holdings
Ltd,
Juliette
Enterprises
Ltd,
Dimitrios
Mavrikos,
Steven
Mavrikos,
and
George
Mavrikos
(hereafter
the
“clients”
or
the
“applicants”)
to
determine
the
question
whether
they
can
successfully
claim
solicitor-client
privilege
in
respect
of
certain
files
and
documents.
The
proceeding
is
pursuant
to
subsections
232(4)
and
(5)
of
the
Income
Tax
Act.
The
Department
of
National
Revenue
obtained
court
approval
of
an
authorization
to
enter
and
search
certain
premises,
and
to
seize
documents
and
records
pertaining
to
the
applicants
“that
may
afford
evidence
as
to
the
violation
of
any
provision
of
the
Income
Tax
Act
or
Regulations
.
.
One
of
the
premises
for
which
entry
was
authorized
was
that
of
the
solicitor
for
the
applicants.
On
May
27,
1981,
officers
of
the
department
seized
from
the
solicitor
a
number
of
files
relating
to
the
applicants.
Solicitor-client
privilege
was
claimed,
on
behalf
of
the
clients,
by
the
solicitor.
As
I
understand
it,
privilege
has
been
waived
in
respect
of
a
number
of
files
and
documents.
The
contest
now
is
confined
to
11
files,
and
a
brown
manila
envelope
containing
copies
of
trust
ledger
records.
In
these
proceedings,
the
department
filed
an
affidavit
by
one
Gershon
Glen
Barras.
I
do
not
know
whether
an
identical
affidavit
was
filed
to
obtain
the
court
approved
authorization
to
enter
and
search.
In
any
event,
the
Barras
affidavit
sets
out
enquiries
he
has
made
into
the
affairs
of
the
clients
and
the
conclusions
which
he
has
drawn.
One
conclusion
is
that
a
number
of
the
applicants
have
committed
offences
under
section
239
of
the
Income
Tax
Act,
in
that
certain
matters
have
not
been
included
in
revenue
or
in
income:
..
.
thereby
committing
fraud
in
the
filing
of
their
income
tax
returns.
In
respect
of
the
records
and
documents
seized
from
the
solicitor’s
office
this
is
said:
Sydney
Cramer
performed
legal
services
for
Romeo’s
Place
(Victoria)
Ltd.,
Romeo’s
Pizza
&
Steak
House
(Duncan)
Ltd.,
Romeo’s
Pizza
&
Steak
House
Ltd,
Millos
Development
Co.
Ltd,
Romeo’s
Holdings
Ltd,
Juliette
Enterprises
Ltd,
Dimitrios
Mavrikos,
Steven
Mavrikos
and
George
Mavrikos,
and
that
documents
now
in
the
custody
of
Arthur
Pickering,
Deputy
Sheriff
of
the
County
of
Vancouver
as
a
result
of
a
claim
of
privilege
by
Sydney
Cramer
relate
to
the
affairs
of
the
above
applicants
and
to
the
matters
described
in
this
my
Affidavit,
(my
underling)
Portions
of
the
Barras
affidavit
were
attacked
as
not
complying
with
Rule
332(1)
of
the
Rules
of
this
Court:
332(1)
Affidavits
shall
be
confined
to
such
facts
as
the
witness
is
able
of
his
own
knowledge
to
prove,
except
on
interlocutory
motions
on
which
statements
as
to
his
belief
with
the
grounds
thereof
may
be
admitted.
Some
paragraphs
of
the
affidavit
are
based
on
information
and
belief.
The
source
of
the
information
and
belief
is,
in
some
instances,
set
out.
In
certain
paragraphs
this
phrase
is
used:
“As
a
result
of
my
enquiries
.
.The
source
of
the
enquiries
is,
in
some
paragraphs,
not
set
out.
In
others
it
is.
Many
portions
of
the
Barras
affidavit
do
not,
to
my
mind,
comply
with
Rule
332.
This
proceeding
is
not
an
interlocutory
motion.
It
is
final
in
nature.*
Those
portions
of
the
Barras
affidavit,
which
indicate
his
information
is
based
not
on
personal
knowledge,
but
from
enquiries
or
information
and
belief
are,
therefore,
not
admissible
in
this
proceeding.
Even
if
information
and
belief
were
admissible,
there
has
not
been,
in
respect
of
a
number
of
paragraphs,
compliance
with
that
part
of
Rule
332(1).
One
of
the
key
paragraphs
is
paragraph
12:
12.
As
a
result
of
my
enquiries,
I
know
that
Romeo’s
Pizza
&
Steak
House
Ltd
and
Romeo’s
Place
(Victoria)
Ltd
make
deliveries
only
if
the
sale
is
$5
or
more.
Thurlow,
ACJ,
now
CJ,
said,
in
respect
of
Rule
332(1),
this:
It
seems
to
have
become
a
common
practice
in
preparing
material
for
use
in
interlocutory
applications
to
ignore
the
first
clause
of
this
Rule
and
to
use
the
second
clause
as
a
device
to
avoid
the
swearing
of
an
affidavit
by
a
person
who
knows
the
facts
in
favour
of
putting
what
he
knows
before
the
Court
in
the
form
of
hearsay
sworn
by
someone
who
knows
nothing
of
them.
This
is
not
the
object
of
the
Rule.
The
Court
is
entitled
to
the
sworn
statement
of
the
person
who
has
personal
knowledge
of
the
facts
when
he
is
available.
The
second
part
of
the
rule
is
merely
permissive
and
is
for
use
only
when
the
best
evidence,
that
is
to
say
the
oath
of
the
person
who
knows,
is
for
some
acceptable
or
obvious
reason
not
readily
obtainable.*
On
this
same
rule,
I
made
these
comments:
The
respondent
Simmonds
filed
his
own
affidavit.
It
is
seriously
defective
in
form.
It
is
a
fairly
lengthy
affidavit
based,
not
on
personal
knowledge,
but
on
information
and
belief.
Throughout,
the
following
phrase
appears:
“I
am
informed
and
believe
.
..”
Nowhere,
as
required
by
the
rules,
are
the
sources
and
grounds
of
his
information
and
belief
set
out.
I
might
add
it
is
not
sufficient
in
my
view,
to
state
merely
(for
example):
I
am
informed
by
John
Jones
and
verily
believe.
There
must
be
sufficient
identification
of
John
Jones
and
disclosure
of
other
facts
from
which
the
Court
can
conclude
John
Jones
probably
has
first-hand
knowledge
of
the
facts
asserted
by
the
deponent,
and
that
in
those
circumstances,
the
deponent’s
grounds
for
belief
in
their
truth
are
reasonable.**
I
return
to
the
Barras
affidavit.
The
whole
purpose
of
the
document
was
to
endeavour
to
prove,
by
affidavit,
a
prima
facie
case
of
fraud
against
the
applicants.
This
assertion
of
fraud
was
to
circumscribe,
in
some
respects,
the
claim
for
solicitor-client
privilege.
It
is
a
well
known
principle
that
where
communications
between
solicitor
and
client,
or
advice
given
by
the
solicitor,
are
in
furtherance
of
a
fraud
(whether
the
solicitor
was
a
party
to
or
ignorant
of
the
illegal
object),
the
privilege
is
lost.
In
the
Barras
affidavit,
the
alleged
prima
facie
case
of
fraud
is
dependent
on
paragraphs
12
and
22.
I
have
already
set
out
paragraph
12.
Barras
concludes
in
paragraphs
13
and
14
that
certain
revenue
must
necessarily
have
not
been
disclosed.
That
conclusion,
however,
is
essentially
based
on
paragraph
12.
That
paragraph
is
inadmissible
as
evidence.
Paragraph
22
is
as
follows:
22.
In
the
course
of
my
enquiries
I
examined
documents
and
records
on
file
in
the
Victoria
Land
Registry
Office
of
the
Province
of
British
Columbia.
Nowhere
in
the
affidavit
are
the
documents
and
records
referred
to
set
out.
Barras
then
goes
on
to
come
to
certain
conclusions
based
on
the
land
registry
office
records
and
certain
other
records
that
some
of
the
applicants
have
disbursed
more
funds,
over
a
specified
period
of
time,
than
were
available
to
them
from
known
sources.
Paragraph
24
of
the
Barras
affidavit
is
as
follows:
24.
As
a
result
of
my
enquiries,
I
have
reasonable
grounds
for
believing
and
do
believe
that
a
portion
of
the
excess
disbursements
referred
to
in
paragraph
23.
supra
includes
the
proceeds
of
unreported
delivery
sales
referred
to
in
paragraph
13.
and
14.
supra
and
that
evidence
of
such
excess
disbursements
of
unreported
delivery
sales
may
be
found
in
the
records
of
the
applicant.
Again
the
facts
and
conclusions
go
back
to
paragraph
12
and
paragraph
22,
both
of
which
are
not
based
on
first
hand
knowledge.
I
have
no
qualms
in
holding,
quite
apart
from
Rule
331(2),
that
where
fraud
is
asserted
in
order
to
try
and
circumscribe
solicitor-client
privilege,
a
prima
facie
case
must
be
made
from
first
hand
knowledge,
and
not
on
information
and
belief.
An
allegation
of
fraud
is
a
serious
matter.
In
an
ordinary
civil
case,
where
fraud
is
alleged,
the
quality
of
proof
required
is
greater
than
in
other
types
of
civil
cases.
The
standard
is
not
the
criminal
one.
The
ordinary
civil
standard
of
balance
of
probabilities
remains.
But
there
are
degrees
of
probability
or
proof
within
that
standard.*
There
has
not
been,
in
this
proceeding,
a
prima
facie
case
of
fraud
made
out.
I
now
turn
to
the
particular
files
and
documents
for
which
solicitor-client
privilege
is
claimed.
I
have
examined
all
of
these
files.
Some
of
them
have
nothing
whatever
to
do
with
the
financial,
business
or
tax
affairs
of
any
of
the
applicants.
Counsel
for
the
department
made
a
general
submission
on
this
point.
The
question
of
relevance,
it
is
said,
is
not
a
matter
on
which
the
court,
upon
hearing
this
kind
of
application,
can
rule;
the
relevance
of
the
file,
or
of
any
of
its
contents,
is
to
be
determined
by
civil
servants:
the
investigators
in
the
Department
of
National
Revenue;
if
the
file,
or
some
documents
in
it,
are
not
subject
to
solicitor-client
privilege,
then
the
file
or
documents,
even
if
irrelevant,
must
be
handed
over
to
the
department.
I
cannot
accept
that
interpretation
of
the
statute.
The
relevant
sections
of
the
Income
Tax
Act
are
as
follows:
231(4)
Where
the
Minister
has
reasonable
and
probable
grounds
to
believe
that
a
violation
of
this
Act
or
a
regulation
has
been
committed
or
is
likely
to
be
committed,
he
may,
with
the
approval
of
a
judge
of
a
superior
or
county
court,
which
approval
the
judge
is
hereby
empowered
to
give
on
ex
parte
application,
authorize
in
writing
any
officer
of
the
Department
of
National
Revenue,
together
with
such
members
of
the
Royal
Canadian
Mounted
Police
or
other
peace
officers
as
he
calls
on
to
assist
him
and
such
other
persons
as
may
be
named
therein,
to
enter
and
search,
if
necessary
by
force,
any
building,
receptacle
or
place
for
documents,
books,
records,
papers
or
things
that
may
afford
evidence
as
to
the
violation
of
any
provision
of
this
Act
or
a
regulation
and
to
seize
and
take
away
any
such
documents,
books,
records,
papers
or
things
and
retain
them
until
they
are
produced
in
any
court
proceedings.
232(1)
In
this
section,
(e)
“solicitor-client
privilege”
means
the
right,
if
any,
that
a
person
has
in
a
superior
court
in
the
province
where
the
matter
arises
to
refuse
to
disclose
an
oral
or
documentary
communication
on
the
ground
that
the
communication
is
one
passing
between
him
and
his
lawyer
in
professional
confidence,
except
that
for
the
purposes
of
this
section
an
accounting
record
of
a
lawyer,
including
any
supporting
voucher
or
cheque,
shall
be
deemed
not
to
be
such
a
communication.
232(3)
Where
an
officer
is
about
to
examine
or
seize
a
document
in
the
possession
of
a
lawyer
and
the
lawyer
claims
that
a
named
client
of
his
has
a
solicitorclient
privilege
in
respect
of
that
document,
the
officer
shall,
without
examining
or
making
copies
of
the
document
(a)
seize
the
document
and
place
it,
together
with
any
other
document
in
respect
of
which
the
lawyer
at
the
same
time
makes
the
same
claim
on
behalf
of
the
same
client,
in
a
package
and
suitably
seal
and
identify
the
package;
and
(b)
place
the
package
in
the
custody
of
the
sheriff
of
the
district
or
county
in
which
the
seizure
was
made,
or,
if
the
officer
and
the
lawyer
agree
in
writing
upon
a
person
to
act
as
custodian,
in
the
custody
of
such
person.
232(4)
Where
a
document
has
been
seized
and
placed
in
custody
under
subsection
(3),
the
client,
or
the
lawyer
on
behalf
of
the
client
may
(a)
within
14
days
from
the
day
the
document
was
so
placed
in
custody,
apply,
upon
3
days’
notice
of
motion
to
the
Deputy
Attorney
General
of
Canada
to
a
judge
for
an
order
(i)
fixing
a
day
(not
later
than
21
days
after
the
date
of
the
order)
and
place
for
the
determination
of
the
question
whether
the
client
has
a
solicitor-client
privilege
in
respect
of
the
document,
and
(ii)
requiring
the
custodian
to
produce
the
document
to
the
judge
at
that
time
and
place;
(b)
serve
a
copy
of
the
order
on
the
Deputy
Attorney
General
of
Canada
and
the
custodian
within
6
days
of
the
day
on
which
it
was
made,
and,
within
the
same
time,
pay
to
the
custodian
the
estimated
expenses
of
transporting
the
document
to
and
from
the
place
of
hearing
and
of
safeguarding
it;
and
(c)
if
he
has
proceeded
as
authorized
by
paragraph
(b),
apply,
at
the
appointed
time
and
place,
for
an
order
determining
the
question.
The
powers
of
the
court,
on
the
present
application
are
set
out
in
subsection
232(5):
232(5)
An
application
under
paragraph
4(c)
shall
be
heard
in
camera,
and
on
the
application
(a)
the
judge
may,
if
he
considers
it
necessary
to
determine
the
question,
inspect
the
document
and,
if
he
does
so,
he
shall
ensure
that
it
is
repackaged
and
resealed;
and
(b)
the
judge
shall
decide
the
matter
summarily
and,
(i)
if
he
is
of
opinion
that
the
client
has
a
solicitor-client
privilege
in
respect
of
the
document,
shall
order
the
custodian
to
deliver
the
document
to
the
lawyer,
and
(ii)
if
he
is
of
opinion
that
the
client
does
not
have
a
solicitor-client
privilege
in
respect
of
the
document,
shall
order
the
custodian
to
deliver
the
document
to
the
officer
or
some
other
person
designated
by
the
Deputy
Minister
of
National
Revenue
for
Taxation,
and
he
shall,
at
the
same
time,
deliver
concise
reasons
in
which
he
shall
describe
the
nature
of
the
document
without
divulging
the
details
thereof.
Subsection
231(4),
as
can
be
seen,
authorizes
the
right
of
entry
and
search
for
documents
and
records
“.
..
that
may
afford
evidence
as
to
the
violation
of
any
provision
of
this
act
or
regulation
.
.
and
to
seize
such
documents.
In
my
view,
that
does
not
authorize
the
searching
for
and
seizure
of
all
records
merely
because
they
might
bear
the
name
of
the
taxpayer
whose
tax
affairs
are
under
investigation.
Nor
does
the
subsection,
to
my
mind,
expressly
or
impliedly
clothe
the
Minister
or
his
officials
with
the
right
to
decide
whether
files
are
relevant,
in
the
sense
they
may
afford
evidence.
Where
solicitor-client
privilege
is
claimed,
the
court
must
decide
whether
that
privilege
exists.
But
the
question
of
that
privilege
must,
in
my
opinion,
be
decided
in
respect
of
documents
or
records
relevant
to
the
affording
of
evidence
as
to
the
violation
of
any
provision
of
the
Income
Tax
Act.
If
the
documents
or
records
have
no
reasonable
relevance
as
possible
evidence
in
respect
of
a
violation
of
the
Act
or
a
regulation,
then,
as
I
see
it,
the
court
need
not,
and
should
not,
decide
whether
there
is
solicitor-client
privilege.
The
scheme
of
sections
231
and
232
indicates
to
me
the
legislators
intended
the
court
must
determine,
on
a
generous
and
reasonable
basis,
the
relevance
of
the
records
to
the
investigation.
If
on
inspection
by
the
judge,
they
are
absolutely
irrelevant
to
any
present
or
potential
violation
of
the
Income
Tax
Act,
then
they
should
be
returned
to
the
taxpayer
without
examination
by
any
departmental
officials.
some
of
the
files
in
question
here
are
excellent
examples
of
irrelevance:
File
1600:
Romeo’s
Pizza
&
Steak
House
Ltd.
Re:
David
Naldrett
This
file
relates
to
the
defence
of
a
county
court
action
against
Romeo’s
Pizza
and
Steak
House
Limited
and
perhaps
two
of
the
applicants
as
well
as
two
other
persons.
The
action
was
by
a
patron
for
damages
for
assault.
The
plaintiff
alleged
the
assault
occurred
in
the
corporate
defendant’s
restaurant
in
Victoria
on
September
21,
1974.
The
file
contains
pleadings,
appointments
to
examine
for
discovery,
a
notice
of
trial
and
the
usual
court
documents
in
connection
with
civil
litigation.
There
is
also
correspondence
passing
between
the
applicants’
solicitor
and
the
clients,
and
between
their
solicitor
and
the
solicitors
for
the
plaintiff.
Again,
it
is
the
usual
correspondence
written
in
connection
with
the
conduct
of
a
small,
ordinary
civil
law
suit.
There
are
copies
of
transcripts
of
the
examinations
for
discovery.
There
are
also
handwritten
notes
by
the
solicitor,
obviously
a
record
of
the
solicitor’s
interview
with
his
client.
The
action
was
settled,
and
the
file
closed,
by
December
29,
1975.
But
the
tax
years
under
investigation
are
1976
to
1979
inclusive.
Most,
if
not
all,
of
the
documents
on
this
file
are,
in
my
view,
privileged.
That
is
undoubtedly
the
case
in
respect
of
the
handwritten
notes
of
the
solicitor.
I
see
no
reason
why
any
documents,
which
may
not
be
privileged,
should
be
turned
over
to
tax
investigators
if
they
predate
the
tax
years
in
question
and
have
no
relevance
to
the
tax
matters
under
investigation.
This
file
cannot
possibly,
in
any
way,
afford
any
evidence
as
to
a
possible
violation
of
the
Income
Tax
Act.
If
the
department’s
argument
were
accepted,
any
non-privileged
portions
of
this
file
could
be
turned
over
to
be
kept
by
the
investigators
for
their
own
purposes,
or
the
information
merely
retained
by
them
for
some
future
possibility.
If
non-relevant
documents
are
handed
over,
a
zealous
investigator
would
likely
(a)
keep
them
until
investigation
and
prosecution,
plus
any
civil
proceedings
are
all
concluded
and,
(b)
before
finally
turning
them
back
to
the
solicitor,
make
copies.
Bureaucracy
should
not,
as
I
view
the
matter,
be
afforded
access
to
such
material.
The
only
reason
this
file
was
seized,
it
seems
to
me,
is
because
it
bore
the
name
of
one
of
the
applicants.
I
can
understand
that.
But
that
does
not
mean
departmental
officials
then
become
investigator,
prosecutor,
and,
in
respect
of
relevance,
judge.
File
1034:
Juliette
Enterprises
Ltd.
Re:
Liquor
Control
Board
This
file
relates
principally
to
a
charge
against
the
company
of
violating
the
Liquor
Control
Act
by
permitting
minors
to
be
on
that
part
of
the
premises
where
liquor
is
sold.
There
are
notes
made
by
counsel
in
respect
of
the
charge,
plus
some
correspondence
passing
between
the
solicitor
and
his
clients,
and
with
Crown
counsel.
The
charge
was
dismissed.
The
dates
involved
were
from
July
1978
to
May
1979.
Again,
most,
if
not
all,
of
the
documents
on
this
file
are
protected
by
solicitor-client
privilege.
Those
that
may
not
be
privileged,
and
those
that
in
fact
are
privileged,
have
absolutely
nothing
to
do
with
any
alleged
violations
of
the
Income
Tax
Act.
In
my
view,
any
documents
that
are
not
privileged
should
not
be
given
to
the
tax
investigators.
As
I
have
earlier
said,
the
mere
fact
that
the
name
of
one
of
the
taxpayers
appears
on
a
file
does
not
mean
that
it
can
or
ought
to
be
seized.
File
1974:
Mavrikos,
Steve
Re:
Queen
v
Mavrikos
This
file
relates
to
what
I
would
describe
as
a
minor
charge
of
extortion.
The
file
includes
copies
of
the
usual
court
documents,
handwritten
and
typed
notes
of
what
appears
to
be
the
solicitor’s
interview
with
a
client,
correspondence
with
the
Crown
prosecutor,
and
correspondence
with
the
client.
The
charge
was
dismissed.
The
time
period
involved
was
from
September
1975
to
January
1976.
Again
most,
if
not
all,
of
the
documents
in
this
file
are
protected
by
solicitor-client
privilege.
None
of
the
documents
in
the
file
afford
the
slightest
evidence
of
any
violation
of
the
Income
Tax
Act.
File
1711C:
Stylianos
Mavrikos
Re:
Criminal
Charge
One
of
the
applicants
was
charged
with
criminal
negligence
in
the
operation
of
a
motor
vehicle
at
a
ferry
terminal.
The
offence
was
alleged
to
have
occurred
on
December
24,
1974.
The
charge
was
defended.
There
was
a
conviction
before
a
Provincial
Court
judge.
The
conviction
was
appealed.
The
conviction
was
quashed
on
appeal.
There
is
a
transcript
of
the
proceedings
before
the
Provincial
Court.
Counsel’s
notes
and
comments
appear
on
many
of
the
pages.
There
are
other
notes
by
counsel.
There
is
the
usual
correspondence
one
would
expect
to
find
passing
between
the
solicitor,
the
prosecutor’s
office
and
the
court
registry.
The
matter
was
concluded
in
December
of
1975.
Again,
most,
if
not
all,
of
the
documents
in
this
file
are
protected
by
solicitor-client
privilege.
Any
that
are
not,
came
into
existence
before
1976,
the
earliest
year
for
which
the
tax
affairs
of
the
applicants
are
being
investigated.
The
file
affords
absolutely
no
evidence
of
any
possible
violation
of
the
Income
Tax
Act.
File
1757C:
Mavrikos
Re:
Purchase
of
544
Dobson
The
documents
in
this
file
are,
with
one
exception,
confined
to
the
year
1975.
That
one
document,
which
appears
to
me
to
be
absolutely
irrelevant,
bears
a
date
in
1976.
The
file
itself
has
to
do
with
the
purchase,
by
one
of
the
applicants,
of
property
in
Duncan.
The
file
contains
the
normal
documents
and
correspondence
with
respect
to
the
purchase
of
a
piece
of
property.
Quite
a
number
of
the
documents
are,
in
my
view,
privileged.
A
memorandum
dated
November
25,
1975,
is
among
those.
There
is
also
an
envelope.
If
is
from
the
office
of
the
taxpayer’s
solicitor.
On
it,
for
some
reason,
are
listed
a
number
of
files
in
reference
to
various
clients.
None
of
those
clients
have
anything
to
do
with
the
applicants.
I
suspect
this
envelope
accidentally
got
into
this
particular
file.
In
any
event,
the
documents
all
came
into
existence
before
the
income
tax
years
under
investigation.
They
do
not
appear
to
afford
any
evidence
of
a
later
alleged
violation
of
the
statute.
File
2011B:
C
Mavrikos
and
C
Petropavlis
This
file
relates
to
the
lease
of
certain
premises,
and
a
potential
dispute
between
the
lessor
and
lessee.
All
of
the
matters
took
place
in
1980.
In
any
event,
the
documents
on
this
file
are,
in
my
view,
subject
to
solicitor-client
privilege.
I
might
add
they
have
nothing
to
do
with
the
matters
being
investigated
by
the
department.
Files
1020A:
Juliette
Enterprises
Ltd.
|
Files
2348
|
Romeo’s
Pizza
&
Steak
House
(Duncan)
Ltd.
|
|
Files
1794
|
Romeo’s
Pizza
&
Steak
House
Ltd.
|
Files
1509
:
Milios
Restaurant
and
Romeo’s
Restaurant
—Trade
mark
and
Logo.
These
files
were
described
by
the
applicant’s
counsel
in
a
memorandum
as
follows:
All
of
these
files
represent
the
accumulation
of
the
solicitors
materials
for
the
purpose
of
enabling
him
to
have
available
corporate
records
from
which
to
advise
the
client
on
an
ongoing
basis
and
as
such,
the
entire
contents
are
privileged.
If
any
of
the
documents
therein
are
to
be
excluded
from
the
ambit
of
solicitor/client
privilege,
such
documents
would
only
be
comprised
of
correspondence
to
or
received
from
third
parties.
I
agree
with
that
description.
The
files
and
documents
in
them
are,
in
my
opinion,
privileged.
File
1846C:
George
Mavrikos
and
C
Petropavlis
Re:
Purchase
of
Prince
George
Property
I
have
examined
this
file.
It
deals
with
the
purchase
of
property
in
Prince
George.
The
documents
in
it
are
covered
by
solicitor-client
privilege.
Brown
manila
envelope
containing
copies
of
trust
ledger
records:
This
envelope
contains
copies
of
the
solicitor’s
trust
account
records
dealing
with
the
applicants.
There
is
also
a
copy
of
a
trust
account
record
dealing
with
a
client
having
no
connection
with
the
taxpayers.
The
applicants
claim
privilege
in
respect
of
the
entire
contents
of
this
envelope.
They
rely
on
Helman
et
al
v
MNR,
[1970]
CTC
586;
70
DTC
6355.
A
solicitor’s
trust
account
record
of
a
client’s
transactions,
is,
in
ordinary
circumstances,
fraud
absent,
privileged.
It
is
not
a
record
required,
by
the
Income
Tax
Act,
to
be
kept
by
lawyers.
Nevertheless,
it
is
my
view
the
particular
trust
account
records
in
this
case
are
excluded
from
the
normal
solicitor-client
privilege:
this
by
the
specific
exception
in
paragraph
232(1)(e):
..
.
except
that
for
the
purposes
of
this
section
an
accounting
record
of
a
lawyer,
including
any
supporting
voucher
or
cheque,
shall
be
deemed
not
to
be
such
a
communication.
Trust
account
records
are,
undoubtedly,
accounting
records
of
a
lawyer.
The
Helman
case,
and
its
predecessor
In
re
Income
Tax
Act;
In
re
a
solicitor
[1963]
CTC
1,
are,
in
my
opinion,
distinguishable.
The
earlier
case
dealt
with
a
routine
investigation
into
the
tax
affairs
of
a
lawyer.
His
trust
account
records
were
demanded.
He
refused.
In
order
to
determine
the
issue,
a
similar
legal
procedure
to
the
one
in
this
case
was
adopted.
The
claim
of
privilege
was
upheld.
The
Income
Tax
Act
of
that
time
did
not
have
the
exception
clause
in
respect
of
solicitor-client
privilege,
which
I
have
set
out
above.
The
Helman
case
was
factually
similar
to
the
earlier
case.
There
was
a
routine
check
into
the
tax
affairs
of
a
firm
of
lawyers.
A
demand
was
made
for
the
production
of
trust
account
records.
The
demand
was
refused.
Once
more,
in
order
to
decide
the
issue,
a
similar
proceeding
to
the
one
before
me,
was
launched.
Once
more,
the
claim
of
privilege
was
upheld.
At
the
time
of
the
Helman
case,
the
present
exception
clause,
in
respect
of
solicitorclient
privilege,
had
been
inserted
into
the
definition.
Milvain,
CJ
upheld
the
claim
for
privilege
on
several
grounds.
He
pointed
out
the
initial
investigation
section
of
the
statute
(then
subsection
126(1))
referred
to
entry
into
any
premises
where
“.
.
.
any
books
or
records
are,
or
should
be
kept
pursuant
to
this
Act
.
.that
trust
account
records
were
not
kept
by
reason
of
any
direction
in
the
Income
Tax
Act;
that,
in
all
the
circumstances,
the
statutory
provisions
were
not
sufficient
to
do
away
with
the
solicitor-client
privilege
which
arose
in
that
case.
I
note
that
the
present
version
of
subsection
126(1)
(now
subsection
231
(1
)
)
simply
reads:
where
.
.
any
books
or
records
are
or
should
be
kept
.
.
The
words
“pursuant
to
this
Act”
have
been
removed.
I
do
not,
in
any
way,
question
the
correctness
of
the
He/man
decision
and
the
earlier
case.
Those
cases
dealt
with
the
investigation
of
a
lawyer’s
affairs.
The
demand
for
trust
records
involved
the
disclosure
of
the
confidential
affairs
and
communications
between
solicitor
and
client.
But
the
clients’
tax
affairs
were
not
under
investigation.
That
is
not
the
situation
here.
The
tax
affairs
of
the
clients,
not
their
solicitor,
are
being
investigated.
The
clients
are,
in
reality,
claiming
the
privilege.
But
the
statute
specifically
provides
the
solicitor’s
trust
account
records
of
those
clients
are
not
privileged.
In
that
aspect,
as
distinguished
from
the
Helman
case,
the
legislators
have,
in
my
view,
clearly
done
away
with
the
normal
solicitor-client
privilege.
I
have
examined
the
copies
of
trust
account
records
in
the
brown
envelope.
One
record,
as
earlier
stated,
has
to
do
with
a
client
other
than
the
applicants.
It
seems
to
have
been
erroneously
filed
with
the
trust
records
of
the
applicants.
It
will
be
removed
from
the
envelope
and
returned
to
the
solicitor.
The
remaining
trust
account
records
deal
with
the
applicants.
But
some
of
the
transactions
fall
outside
the
years
under
investigation:
1976-1979.
The
entries
for
those
years
will
be
sealed,
or
in
some
other
manner
concealed
or
removed.
The
Minister
is
not
entitled
to
examine
that
information.
That
concludes
my
rulings
on
the
particular
files
and
documents.
I
request
counsel
for
the
applicants
to
draw
the
formal
pronouncement
and
to
submit
it
to
counsel
for
the
department
for
approval.
If
agreement
cannot
be
reached,
then
the
matter
may
be
spoken
to.
There
are
no
costs.
Appeal
allowed
in
part.
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