Date: 20021129
Docket: T-1884-01
Neutral Citation No.: 2002 FCT 1247
BETWEEN:
N.M. PATERSON & SONS LIMITED
Plaintiff
- and -
THE ST.LAWRENCE SEAWAY
MANAGEMENT CORPORATION
Defendant
REASONS FOR ORDER AND ORDER
(Delivered from the Bench in Montréal, Québec
on Thursday, November 28, 2002)
HUGESSEN J.
[1] This is a motion for contempt of court brought against Mr. David Marler who was, at all relevant times, the solicitor of record for the plaintiff in this action. The offence alleged is that he has breached the implied obligation of confidentiality imposed upon parties to litigation with respect to documents and information received from the other side on discovery in a civil action. I do not find it necessary to expatiate here upon the importance of the implied undertaking of confidentiality. I have done so on other occasions, others far wiser than I am have also done so and their remarks are recorded in appropriate places and I think that I can safely leave the matter there.
[2] I set out here the two paragraphs from the Court's order of October 4, 2002 giving the detail of the alleged offence.
ORDER OF OCTOBER 4, 2002
The acts which David F.H. Marler is charged is that he, by his conduct described below, breached the implied undertaking rule imposing confidentiality on information obtained from a document produced by the defendant for examinations for discovery, and on information from the oral examinations for discovery of the defendant's discovery witness in this action:
i) In disclosing the contents of a document produced by the defendant on discovery being an "occurrence report' (which is an internal document to the defendant) to the media which was the subject of an article published in the St. Catharines Standard newspaper on August 3, 2002. The information in the occurrence report was completed and the document signed by one Rheo Dagenais, at all material times being a Seaway employee, on August 13, 2001, who prepared this report for the defendant's internal purposes in respect of the Welland Canal incident being the subject of the claim herein. The said document was a discovery production delivered by the defendant to David F.H. Marler's office in Mr. Marler's capacity as counsel for the plaintiff herein;
ii) In disclosing certain aspects of the oral discovery evidence of the defendant's discovery witness, Mr. Pat Vincelli, to the media, which information was published in the St. Catharines Standard and the Niagara Falls Review in newspaper articles on August 9, 2002.
[3] I also set out here the Agreed Statement of the evidence that would have been given by Mr. Bill Currie, a reporter for the Niagara Standard and in particular sub-paragraphs a) through i) of the Agreed Statement of his evidence.
Statement of Agreed Facts
4. Bill Currie is a reporter employed by The Standard (St. Catharines).
a) He was the reporter who authored an article published in The Standard (St. Catharines) on August 3, 2002, under the headline "Operator admitted shutting bridge on ship" a copy of which is found at Tab 4 of the Brief of Documents.
b) Prior to writing the article he spoke to David Marler. Mr. Currie contacted Mr. Marler whom he knew to be the solicitor to N.M. Paterson & Sons Limited, the plaintiff in an action against The St. Lawrence Seaway Management Corporation.
c) He conducted a telephone interview with David Marler who read a copy of a report which Mr. Marler identified as having been signed by Rheo Dagenais, the bridge operator at the time of the accident.
d) He was unaware of the report until he was informed of its existence and contents by David Marler.
e) His article accurately reflects his discussion with David Marler and in particular the accuracy of the quotation from the report read to him by David Marler.
f) He spoke again to David Marler following the examination for discovery of Pat Vincelli. During that interview David Marler told him that Mr. Vincelli had admitted during his discovery that the Allanburg bridge operator had closed the bridge on the WINDOC in August 2001 and that was caused by an error by the bridge operator.
g) David Marler also told him that during the examination for discovery the Seaway stopped short of admitting any liability for the accident.
h) Mr. Currie wrote an article which included the information provided to him by David Marler, and that article was published on August 9, 2002, in The Standard and the Niagara Falls Review. This second article is found at Tabs 5 and 6 of the Brief of Documents.
i) His article accurately reflects his discussion with David Marler.
[4] I set out here extracts of the two articles written by Mr. Currie which are referred to in the order of October 4 and which were published in his newspaper.
Article August 3, 2002
Operator admitted shutting bridge on ship
Seaway lawyer declines comment in early stage of $20-million lawsuit
By Bill Currie
Standard Staff
The operator of the Allanburg lift bridge last August admitted to lowering the bridge onto the bulk carrier Windoc, according to his own report of the collision.
In the report, there was no suggestion of any mechanical malfunction, inclement weather, nor anything else unusual before the bridge collided with the stern tower of the ship, then owned by N.M. Paterson and Sons Ltd.
The report was signed by bridge operator Rheo Dagenais on Aug. 11, 2002 - the day of the collision - and details in his own words what happened.
In a telephone interview from Thunder Bay on Friday, Paterson lawyer David Marler read a copy of the report to The Standard.
Marler said Dagenais wrote that he saw the downbound ship approaching, he raised the bridge using electric power, went to the north side of the control room and looked out.
"It was still light out and I could see the canal. I saw the ship was almost clear," Dagenais said in his report. "I went to the control panel and gave the siren and started to lower the bridge. I stood at the control panel. I didn't see or hear anything unusual until I heard the sound of the ship hitting the bridge."
The report said Dagenais didn't remember anything after that until the control phone rang and he recognized the voice of a St. Lawrence Seaway Management Corp. employee.
Article August 9, 2002
Seaway official admits 'error'
Lawyers for Windoc's former owner have some answers in pretrial discovery but want more knowledgeable witness
By Bill Currie
Standard Staff
...
But Marler said some key issues were addressed.
He said Vincelli admitted the Allanburg bridge operator had closed the bridge on the Windoc last August and that was caused by "an error" by the bridge operator.
[5] Finally, I would simply say that it is not necessary to set out here the document which was disclosed by Mr. Marler to Mr. Currie and which was published by Mr. Currie as a box accompanying the first of those two articles because I am satisfied that the document is reproduced exactly in the newspaper. In other words, what appears in the newspaper is an exact reproduction of the document called Incident Report which was produced on discovery in this action.
[6] It is not necessary, in my view, to resume the other evidence that I have heard other than to say that I am convinced beyond any reasonable doubt that the elements of the offence as charged have been made out. It is, however, necessary that I take up three points that were argued by the defence, all of which are points of law.
[7] First, it is said that it has not been shown that the document, the Incident Report, or the information, both that which is contained in the document and that is contained in the examination for discovery of Mr. Vincelli, the defendant's witness in the discovery, were not confidential. I am quite satisfied on the evidence that both the document and what was said by Mr. Vincelli in answer to questions on discovery was considered to be and was treated as confidential by the defendant corporation. I say I am satisfied of that on the evidence. I would go further, however. In my view, any document or any information produced or given under compulsion as a result of the civil process of this Court by any person, if it is not given in open Court, is confidential to that person unless and until the contrary is shown.
[8] Of course, the contrary may be shown by implication, as where a person is shown a copy of a letter which he has himself published, were made known to other persons, and there is a multitude of other possible examples, or the release of confidentiality may be expressed, but unless that is shown, documents and information given under compulsion of this Court are confidential until they become part of the public record. I would only add in this connection that this document and this information which are the subject matter of this motion were not part of the public record and there is no indication anywhere in the evidence that their confidentiality had been waived by any party.
[9] The second point taken was that the protection of the implied undertaking only goes to information and documents that are not otherwise legitimately available from other sources. Information which is confidential under the rule that I have just outlined, is not publicly available unless and until it is shown to be publicly available. Once again, that showing may be by implication or it may be by express evidence but in this case, I am quite satisfied beyond any doubt whatever that the information and the document here in question were not available publicly by any legitimate means.
[10] The third point taken very skilfully by Mr. Schachter is based on a passage in a decision of the Supreme Court of Canada in the Lac d'Amiante du Québec Ltée v. 2858-0702 Québec Inc. case, [2001] 2 S.C.R. 743, which must now be regarded as the leading case in Canada on the implied undertaking of confidentiality. I do not view that case as being simply limited to the law of Québec although there is no doubt that that is where the case came from. The passage relied on is one where Mr. Justice LeBel, speaking for the Court, indicated that the obligation not to disclose would not apply where the document or information would be made available at trial. That passage is, I say with respect, ambiguous. I am quite satisfied from the state of the law as it existed prior to the Lac d'Amiante case and as it exists elsewhere, and from the fact that the Supreme Court gave no indication that it was intending a radical change in this aspect of the rule, that the rule as there stated was and is still that the obligation is released when and if the document or information is produced publicly at trial. Any other rule would not be manageable or possible to apply sensibly. It would invite the Court on occasions such as this one to indulge in speculation: Would this document be used at trial or would it not? Well, would the defendant not feel compel to settle before trial? Might there be some other circumstances which would intervene? and a multitude of other possible questions come to mind.
[11] The law, as I say, was before and still is that it is only if and when the document or the information becomes publicly available by being used at trial that the obligation not to disclose is released.
[12] Accordingly, and for these reasons, I find that the respondent, Mr. Marler, is guilty of the offence of contempt of Court.
(later)
[13] At the conclusion of a hearing earlier today in which I found the respondent, Mr. Marler, guilty of a contempt of Court, I suggested to counsel that the Court would very probably apply the rule which I think is of general application, that where the prosecution of a contempt has been undertaken by a private party and the prosecution is successful, the Court will order the contemnor to pay the prosecutor's costs on a solicitor and client basis. Upon returning to Court after we had adjourned the hearing for the purposes of representations on the matter of sentence and after an indication from Mr. Schachter that he would not be calling evidence, Mr. Fournie informed me that his instructions were to seek no penalty other than the payment of costs on a solicitor and client basis. He further informed me that up to the beginning of the week, that is to say up to the first part of the hearing which was started on Monday of this week, the solicitor and client costs were estimated to be in the range of $60,000 and that on an estimate coming down to the end of today, that amount would go up to $75,000.
[14] In response to those representations Mr. Marler's counsel, while not contesting those figures, estimates as they are, reminded me of the requirement that an order for costs, even when being viewed as a penalty, should not be unduly burdensome. He also reminded me that the record indicates that Mr. Marler, at the time that he committed the contempts (for there were two), was in ignorance of the implied undertaking rule. I may say that I am not greatly impressed by this latter observation, ignorance is, of course, no excuse and in a lawyer who practices with some frequency in this Court, ignorance of the rule which is always applied in this Court, is no excuse at all. I would add to that, that accepting as I do that Mr. Marler was ignorant of the rule when he committed these contempts, his attention was drawn to the rule almost immediately afterwards on August 13, 2002 of this year.
[15] Returning to the amount of the costs, counsel for Mr. Marler also reminded me of an order made by me in a not dissimilar case, although there are many points of difference in the matter of Pfizer Canada Inc. v. Apotex Inc., [1998] F.C.J. No. 1884, where I refused to order payment of an amount of some $160,000 in solicitor and client costs, an amount which I believe I described at that time as being swingeing.
[16] The reason underlying the practice of ordering solicitor and client costs is important and should be recalled to mind. The Court is indebted to a private party who prosecutes a contempt of this sort, and the aim of that prosecution really cannot be to benefit the prosecuting party except perhaps in the most indirect way, the aim of the prosecution and the reason for the Court's indebtedness is that the prosecution, if successful, protects the integrity of the Court's process as that is what is at issue in the implied undertaking. The Court puts in the hands of solicitors mighty weapons of invasive intrusion into the private affairs of their opponents. Those weapons must be used with the utmost discretion else, the Court may well withdraw them.
[17] The offence in my view is a very serious one. It is particularly grave in this case, where the only construction that I can put on what Mr. Marler did was that it was an attempt to put pressure on the other party. Now, that is perfectly alright, provided one plays by the rules, but one must not abuse the Court's process to put pressure on one's opponent in what is a civil action. Likewise, and while I accept that Mr. Marler now apologizes for his conduct and I accept that unreservedly, he did not do so timely. As I say, he was relieved of any misapprehension he may have been under as to the nature of the implied confidentiality rule almost immediately after the contempts were committed. And that is the time when he could and should have put an end to these proceedings. If he had done so, none of us would have to be here today.
[18] That is not to penalize him for standing on his rights and defending himself but it is to say that he can hardly claim the benefit of penitence at this late stage.
[19] Taking all these things into account and in particular what I would refer to as the totality principle, that is to say the principle that no order even an order for costs which is in the nature of a penalty should be so burdensome as to be wholly unreasonable. But, balancing that with the requirement that the order should play and must play an important deterrent role, so that solicitors will not be tempted to breach their implied undertakings, I direct that the respondent Mr. Marler, pay the defendant, the St. Lawrence Seaway Management Corporation, the sum of $37,500 in costs.
ORDER
The respondent to this motion, David Marler, shall pay to the defendant the St. Lawrence Seaway Management Corporation the sum of $37,500 for costs related to this motion.
James K. Hugessen
Judge
Montréal, Québec
November 29, 2002
FEDERAL COURT OF CANADA
TRIAL DIVISION
Date: 20021129
Docket: T-1884-01
BETWEEN:
N.M. PATERSON & SONS LIMITED
Plaintiff
- and -
THE ST.LAWRENCE SEAWAY
MANAGEMENT CORPORATION
Defendant
REASONS FOR ORDER AND ORDER
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1884-01
STYLE OF CAUSE:
N.M. PATERSON & SONS LIMITED
Plaintiff
and
THE ST. LAWRENCE SEAWAY MANAGEMENT CORPORATION
Defendant
PLACE OF HEARING: Montreal, Quebec
DATE OF HEARING: November 28, 2002
REASONS FOR ORDER AND ORDER :
THE HONOURABLE MR. JUSTICE HUGESSEN
DATED: November 29, 2002
APPEARANCES:
Mr. Raphael H. Schachter FOR PLAINTIFF
Mr. Eric Fournie FOR DEFENDANT
SOLICITORS OF RECORD:
Lavery de Billy FOR PLAINTIFF
Montreal, Quebec
Rogers Campbell Mickleborough FOR DEFENDANT
Toronto, Ontario
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