Our first case this month deals with the interpretation of “commercial activity” under PIPEDA. The court held that the collection of a Plaintiff’s personal information by third parties for the defence of a civil action does not constitute a commercial activity and is therefore exempt from the application of PIPEDA.
Our second case this month is a decision of the Newfoundland and Labrador Supreme Court which also deals with the issue of solicitor client privilege, this time in the context of a request for documents under s. 52 of the Access to Information and Protection of Privacy Act. The Court confirmed that solicitor- client privilege had been broadened to a rule of substance, thereby restricting the Commissioner’s power to demand such documents.
Our third case this month is a decision of the Nova Scotia Supreme Court regarding the application of the “cap” to non-monetary losses in cases of “minor injuries”. The Court held that failure of the Plaintiff to prove that his injuries exceeded the threshold automatically meant general damages were capped at $2,500, despite the fact that the Defendant agreed they may have exceeded it.
State Farm Mutual Automobile Insurance Company v. Privacy Commissioner of Canada and Attorney General of Canada, 2010 FC 736
This was an action for judicial review challenging the authority of the Privacy Commissioner to compel the production of solicitor-client or litigation privileged information. Specifically, the Court was asked to determine whether the provisions of PIPEDA apply to evidence collected by an insurer on behalf of an insured in the defence of a tort action.
State Farm’s insured was involved in a motor vehicle accident in March 2005. The passenger at the time was injured and subsequently commenced an action. State Farm retained legal counsel for their insured and hired private investigators to carry out surveillance on the Plaintiff both before and after the tort action was commenced.
In November 2005, the Plaintiff requested from State Farm, pursuant to PIPEDA, any and all information it had collected on him, and in particular copies of any surveillance reports or tapes. State Farm denied the request on the grounds that PIPEDA did not apply. The Plaintiff made a second request in January 2006 which again was denied.
A complaint was made to the Privacy Commissioner alleging that State Farm had denied him access to his personal information, had disclosed his personal information to a third party without his consent and had not provided adequate safeguards to protect his personal information.
The Privacy Commissioner initiated its investigation in May 2007. State Farm took issue with the Commissioners authority to investigate and brought proceedings before the New Brunswick Court of Queen’s Bench. However, as the issues in question dealt with the Commissioner’s authority to act under PIPEDA, a Federal Statute, the Federal Court was determined to be the proper forum.
While there were a number of issues put to the Federal Court, the main issue surrounded the interpretation of “commercial activity” as found in PIPEDA. In concluding that the collection of such evidence by an insurer in the defence of a third party claim does not constitute a commercial activity, the Court made a comparison to a self-represented defendant who collected information on a plaintiff. In such a case the collection of evidence would clearly not constitute a “particular transaction, act or conduct that is of a commercial character” as defined in subsection 2(1) of PIPEDA, and therefore there was no commercial character associated with the activity.
The Privacy Commissioner argued that the relationship between an insured, their insurer, legal counsel or private investigators was one which involved monetary compensation for service, thereby making any information collected a “commercial activity”. The Court rejected this argument on the basis that this argument ultimately made all information collected by a Defendant prohibited under PIPEDA unless the Plaintiff consented to its collection, a purpose that was clearly not intended by PIPEDA.
In reaching its conclusion, the Federal Court reiterated that it is the primary nature of the activity or conduct which determines the commercial character of the activity under PIPEDA, and not the incidental relationship between the one who seeks to carry out the activity and the third party. As such, the investigation reports and related documents, as well as the videos which were prepared for State Farm or its lawyers to defend their insured in the tort action were not subject to PIPEDA.
This decision reinforces the importance of both solicitor- client and litigation privilege with respect to defending a civil action. In addition, it also sends a strong message to Plaintiff’s counsel that the litigation process cannot be circumvented in an attempt to obtain information that you are not otherwise privy to as part of the normal civil litigation process.
Newfoundland and Labrador (Attorney General) v. Newfoundland and Labrador (Information and Privacy Commissioner), 2010 NLTD 31
The Department of Justice (“DOJ”) received a request for documents from an unnamed individual (“the Requestor”) but refused the request on the basis that the documents were subject to solicitor-client privilege. The requestor involved the Information and Privacy Commissioner who again asked for production of the documents pursuant to section 52(3) of the Access to Information and Protection of Privacy Act (“the Act”) but the DOJ refused production.
The Newfoundland Supreme Court looked at a number of issues in determining that the language used in s. 52 of the Act was not specific enough to encompass solicitor-client documents. As there was the potential for the section to interfere with solicitor-client privilege, the Court applied a strict interpretation to the section and held that the language used did not unequivocally include solicitor-client privilege.
As a result, the power of the Commissioner to request and review documents which are subject to solicitor-client is now severely limited. The Commissioner no longer has the power to demand such documents and reviews of any refusals based on this privilege can only be conducted by the Courts to ensure that the privilege is not compromised.
One potential downfall of this decision is that it may cause increased costs and delays in the resolution of a complaint if the Commissioner or complainant insist upon taking the matter to Court to review the refusal. However, this decision also has the potential to stop the routine demands from the Privacy Commissioner for all documents requested by a complainant, thereby reducing delays.
NOTE: Section 70 of New Brunswick’s Right to Information and Protection of Privacy Act, is similar to that of section 52 of the Newfoundland Act. However, s. 70(1) of the NB Act expressly excludes the Privacy Commissioner from requesting documents that are subject to solicitor client privilege. The result is that while this decision clearly broadens solicitor- client privilege to a rule of substance, there is already protection in the NB Act to remedy the issue which was raised in Newfoundland and Labrador (AG) v. Newfoundland and Labrador (Information and Privacy Commissioner).
Gillis v. MacKeigan, 2010 NSSC 109
This claim arose out of a pedestrian/vehicle accident where the Plaintiff was injured when the Defendant backed out of his driveway and struck the Plaintiff. The Plaintiff suffered injuries to his pelvis, ribs, right hip, and right hand. In addition, he developed major depression and mild to moderate Post-Traumatic Stress Disorder. Although the Court found that the Plaintiff was significantly disabled prior to the accident, Justice Edwards stated that the accident “has taken a persistently troubled but not totally disabled individual and rendered him totally disabled...in a recreational sense.” The Plaintiff was awarded general damages in the amount of $75,000.00 (Gillis v. MacKeigan, 2010 NSSC 22).
Following this order, Justice Edward realized that the matter may be subject to the $2,500 cap under the regulations of the Insurance Act. He invited counsel to submit post-hearing briefs on the issue.
While Counsel for the Defendant agreed that the Plaintiff suffered from chronic pain that may well fit within the definition described in the regulation, it was up to the Plaintiff to prove this. As the Plaintiff did not meet the onus of showing that his chronic pain is not excluded by section 2(1)(d) of the Regulation, Justice Edward was obligated to reduce the award for general damages to $2,500.
Based on this decision, questions regarding the application of the cap to non-monetary damages will be decided in favor of the Defendant if no evidence to the contrary is presented by the Plaintiff.