Court reminds: "a message does not become privileged merely by sending a copy of it to a lawyer"

A recent decision of the Superior Court of Justice should serve as a good reminder to HR professionals that one must be careful in how information is shared if privilege will be claimed.

In Jacobson v. Atlas Copco Canada Inc., the plaintiff was a former employee of the defendant.  Following a workplace altercation involving the plaintiff and a co-worker, human resources investigated.  However, the plaintiff took the position that the local HR representative was biased.  Accordingly, the HR representative sought the opinion of another HR employee from a different location to ensure impartiality.  Copies of the investigation notes were exchanged among the HR representatives, with a copy to an external employment lawyer.  However, it was not clear that all of the employees on the email chain were aware of the identity of the lawyer, nor did anyone expressly seek the advice of the lawyer with respect to the outcome of the investigation.  In one particular email message, one of the HR reps offered his views on the application of the employer's progressive discipline policy and a proposed course of action vis-à-vis the plaintiff's employment.  A couple of hours later the lawyer provided his legal advice on the situation, although his opinion had not been solicited.  The employee was ultimately terminated, and sued for wrongful dismissal. 

In the course of the action, the plaintiff brought a motion seeking production of the email from the second HR representative of the company (but not the responding email from the lawyer, which clearly contained legal advice).  The employer resisted the motion on the basis that the email communication was protected by solicitor-client privilege and should not be produced.  In support of its position, the employer provided an affidavit from the company's General Manager, who advised that the company had retained the external lawyer to provide advice on the investigation, and his belief that the HR representative had been seeking advice when he copied his email to the lawyer.  However, the company did not provide an affidavit from the HR representative himself.

Justice Ellies looked at the surrounding circumstances to determine whether it was clear that the HR representative had intended to seek the lawyer's advice when he sent his email.  Unfortunately, because the company had not provided the "best evidence" (i.e., a statement from the individual who actually sent the email), the Judge concluded that the hearsay evidence of the General Manager did not establish that this was the intention of the communication in question. As the party claiming privilege, the onus of proving the communication was privileged rested with the company.  The evidence it put forward failed to prove that point on a balance of probabilities.  At paragraph 25, the Judge very succinctly summarized his conclusion:

Atlas Copco relies on [the General Manager]`s evidence that [the lawyer] was retained to provide legal advice prior to the [HR representative's] message and provided an opinion via e-mail a few hours after the message was sent. There is no doubt that [the lawyer]’s role was to provide legal advice with respect to this particular situation and that he did provide that advice after receiving [the HR representative's] message. However, that is not enough, in my view, to establish that [the HR representative] sent the message for the purpose of obtaining that legal advice in light of the other circumstantial evidence surrounding the communication. In the same way that sending a message to both a fellow employee and a lawyer does not prevent a communication from being privileged, a message does not become privileged merely by sending a copy of it to a lawyer.

While the decision turned largely on the  importance of producing the "best evidence" in all circumstances, it also lays bare a common assumption or misunderstanding about legal privilege.  In order to claim solicitor-client privilege, the client (in this context, the employer) must establish that the communication in question was sent to a lawyer with the intention of getting the lawyer's legal advice.  Copying a lawyer without soliciting an opinion may not suffice to protect the message from disclosure later, particularly if there is no discussion amongst the parties about the role of counsel on the email chain. Likewise, if the advice in question is not "legal" per se, privilege will also not apply.  Legal privilege can be a very valuable tool, particularly in the context of an investigation into wrongdoing.  However, if the role of the lawyer is not observed, privilege may be elusive.

Do you have questions about how and when solicitor-client privilege can be claimed?  Need assistance in conducting investigations?  Contact Lance Ceaser for expert guidance.




 

Claiming Privilege Over Workplace Investigation Records

Often employers will retain the services of an independent investigator (typically a lawyer) to investigate issues in the workplace, either expecting or assuming that the investigator's work product (such as notes and the written report) will be privileged and not subject to disclosure and production obligations.  However, if the work of the investigator is to be protected from later disclosure in the course of litigation, the employer must carefully consider the law of privilege prior to retaining a third-party investigator.  The recent decision of Master Short of the Ontario Superior Court of Justice in Howard v. London (City) illustrates the challenges.

Background

In 2012, a resident of the Dearness Home (a nursing home operated by the City of London) packed up his belongings and left the facility, unbeknownst to staff.  The resident had recently been moved from a secure part of the facility to an area that did not have the same access controls.  The resident managed to wander some distance up a very heavily travelled road before he stepped into traffic, was struck, and subsequently died from his injuries.  The death of the resident was widely reported in local media, which raised questions about how such a tragedy could have occurred.  The administrator of the Home was away on vacation at the time, but commenced an investigation immediately upon her return.  However, after only a few days, she was instructed to cease her inquiries, as the City had decided (on advice from external counsel) to conduct an independent investigation, using the services of a local lawyer.  At the same time, the Ministry of Health and Long-Term Care was also conducting its own investigation. Ultimately, the investigator was retained by the Interim City Manager to conduct an investigation into the City's policies, procedures and actions, oversight by the City Council, the City's procedures for investigating critical incidents, and whether City employees and representatives had complied with applicable standards, and to provide legal advice on same.

Before and during the investigation, there was evidence of several "Strictly Privileged and Confidential" email messages among a number of City staff, including the administrator of the Home, regarding the scope of the investigation.  The administrator was interviewed twice and provided some documentation requested by the investigator.  She was repeatedly reassured that she need not be concerned about the outcome of the investigation for her employment, and was specifically told that she could not have her lawyer present during the interviews.  At the end of the investigation, the administrator was advised that she could resign, failing which her employment would be terminated for cause.  She did not receive a copy of any interview notes or the investigator's report, and was given no opportunity to respond to its findings before she was terminated.  She commenced a wrongful dismissal claim and sought production of the investigator's file, including any notes and the report.  The City resisted the motion, claiming solicitor-client privilege and litigation privilege.

The Production Motion

In his decision, Master Short reviewed the evidence that was presented, including a number of the email messages among senior City staff that debated whether the investigation was for human resources purposes or to establish due diligence vis-a-vis resident care (in anticipation that the resident's family would likely bring an action against the City). In one email, the City Solicitor suggested that he would be prepared to seek Council's approval to retain "independent legal counsel... to provide advice and an independent privileged legal opinion" concerning the issues that were ultimately referred to the investigator.  The Master observed that this email was focused on obtaining advice in relation to potential civil liability regarding the death of the resident and made no mention of legal advice on potentially terminating an employee. It was also clear from the email that the City was retaining the lawyer to conduct a fact-finding investigation, not seeking a legal opinion (as suggested by the City Solicitor). Despite the reassurances allegedly given to the administrator, it was also clear that the investigation did have a HR focus, and was intended to determine outcomes for staff who may have had involvement in the incident.

The Master also considered the fact that the City had relied on the investigation in determining that the administrator should be terminated, and had disclosed this reliance to the media on more than one occasion.  The London Free Press reported extensively on the story, and quoted the Mayor tying the termination of the administrator to the report prepared by the investigator.

Under the Rules of Civil Procedure, all relevant documents are to be disclosed to the opposing party, "whether or not privilege is claimed in respect of the document".  Where a party claims privilege over a document, it must set out the basis for its privilege claim, and bears the onus of establishing that privilege applies.  The City claimed both that the investigation documents were covered by solicitor-client privilege, as the investigator was a lawyer whose retainer included the provision of legal advice, and litigation privilege, which applies to documents created by a party when litigation is occurring or is contemplated.  Master Short conducted an extensive review of the law applicable to both types of privilege and made several very helpful findings:

• Although solicitor-client privilege is designed to ensure justice and fairness, by allowing the free exchange of information necessary to a lawyer's representation of a client, it has its limits. For example, the exchange of communication between a client and a lawyer who has been retained only to address a specific legal matter will not be protected if the communication is unrelated to the retainer. Likewise, if the lawyer has been retained in some other capacity unrelated to providing legal advice or exercising the skills of a lawyer (i.e., acting as a fact-finder where legal skills are not required), no privilege will attach.
• In those cases where privileged applied to the findings of a lawyer-acting-as-an-investigator, the retainer was clear that the lawyer was to provide legal advice on the specific subject matter of the investigation or was using the specific skills of a lawyer (such as where a lawyer was investigating whether a member of the judiciary had acted inappropriately during a trial).
• When considering whether solicitor-client privilege attaches to records, the understanding of the parties is a factor.  Where the lawyer is presented solely as a fact-finder, and explains that his/her assignment is limited to certain factual matters, it is unlikely that privilege will attach or that it will be limited to those legal issues within the investigator's mandate.
• Unless the retainer specifies that the lawyer-investigator is to provide "legal advice" (rather than just "advice"), a court is less likely to find that solicitor-client privilege applies.
• One party to a privileged communication cannot assert privilege against someone else who also received the advice from the same lawyer, on the basis that the parties have "joint interests".
• In order for litigation privilege to apply, it must be contemplated that a specific claim will be made by or against a particular party.  Where communications involve an incident that may give rise to one particular type of claim (e.g., liability due to negligence), they will not be privileged in relation to a different type of claim (e.g., wrongful dismissal of the person who is found to be negligent).

In the result, Master Short concluded that the investigation file was not privileged, and ordered the City to produce it to the plaintiff (with any personal information of third parties redacted in accordance with the Municipal Freedom of Information and Protection of Privacy Act).  The investigator had been retained not as a lawyer (i.e., to provide legal advice or representation), but to find certain facts.  While the investigation may have been conducted in the contemplation of litigation by the family of the deceased resident, it was not related to a potential wrongful dismissal claim by the plaintiff.  Moreover, the City could not assert privilege against the administrator when she had been part of the communication with respect to the conduct of the investigation.

What Does It Mean?

For employers, this case provides some important guidance:

• Determine whether the employer wishes to maintain privilege over the investigation file.  If it is unlikely to be crucial, it may be advisable to retain a non-lawyer or hire a lawyer to act solely as a fact-finder to contain the costs of the investigation.  It is advisable to obtain legal advice before deciding whether privilege ought to be claimed.
• If a claim of solicitor-client privilege will be made, ensure that the retainer letter is clear that the lawyer-investigator is to make findings of fact and to provide legal advice or opinion on the basis of those findings.  Also ensure that the scope of the retainer is broad enough to cover the personal conduct or blameworthiness of individual employees, and that the advice sought includes labour and employment law advice and recommendations.
• If it's likely that some form of labour or employment litigation may arise from the matter under investigation, such as a civil action, grievance or human rights complaint, then there may be a basis for litigation privilege.  In that case, the investigator need not be retained to provide legal advice.  However, if the investigator will be only a fact-finder in this scenario, he/she should be retained by counsel for the employer (whether external or in-house), rather than by some other representative of the employer, and it should be clear that the investigator's findings are necessary for counsel to advise and represent the "client" (i.e., the employer) in relation to all potential forms of litigation.
• Communication with an investigator or in regards to the investigation must be handled delicately.  It is preferable for communication with the investigator to be with only one or two representatives of the employer, or with counsel for the employer (if possible).  Anyone who may fall within the scope of the investigation should not be included on any 'privileged' communication.  Erect a 'cone of silence' and carefully maintain it, or privilege may be "waived".

Unfortunately, the law of legal privilege is a very complicated area.  While the foregoing recommendations may prove helpful, they cannot be construed as legal advice, in the absence of a very fact-specific analysis of a particular situation.  If you are uncertain about how to undertake an investigation or whether you can assert privilege over the findings of an investigator, obtain legal advice.  Feel free to contact Lance Ceaser for guidance or to ask about investigation services.