Records Management Law — a Necessary Major Field of the Practice of Law — a Summary

“Records management law” will be a necessary area of specialization because electronic records are as important to daily living as are motor vehicles, and are now the most frequently used kind of evidence. Electronic records management is a complex technology, which makes current legal infrastructure of statutes, guidelines, and case law that controls the use of electronic records as evidence very inadequate because it ignores these facts: (1) electronic records technology, and pre-electronic paper records technology are very different technologies—each requires its own unique legal infrastructure; (2) the many serious defects frequently found in electronic records management systems (ERMS’s), and in their software; (3) the electronic records “system integrity concept” (records integrity requires proof of records system integrity) in the electronic records provisions of the Evidence Acts (e.g. ss. 31.1-31.8 of the Canada Evidence Act (CEA); s. 34.1 of the Ontario Evidence Act; and, ss. 41.1-41.8 of the Alberta Evidence Act); (4) the National Standards of Canada for electronic records management,[i] necessary for giving the word “integrity” a meaning in those sections; and, (5) that the solution to the high cost of the “review” stage of electronic discovery proceedings requires a different strategy and procedure than are used now. Because of these shortcomings and society’s heavy dependence upon electronic records, “records management law” is a needed specialty, and the “records management lawyer,” a needed specialist.

1. The serious defects commonly found in electronic records management systems

Having worked with experts in electronic records management systems technology (ERMS technology) for many years, has taught me the substantial consequences of the fact that an electronic record, unlike a pre-electronic paper record, is dependent upon its ERMS for everything, including its existence, its accessibility, and its integrity. Therefore, the laws and practices controlling electronic discovery and admissibility of evidence proceedings are very inadequate because they take no account of these serious defects, very frequently found in ERMS’s:

• the extent of the records holdings is not known;
• poor network control of records locations composed of, e.g., in-house records systems, mobile devices, employee-owned devices, and shared utility services such as “the cloud”;
• records are neither properly classified nor indexed such that retrieval of relevant records is very difficult if not impossible;
• no definitive classification system among institutional, transitory, and personal records;
• no records manual, or one that isn’t kept current or complied with;
• no bylaws (or orders of comparable authority from senior management) dealing with the records system—essential for establishing an organization’s “usual and ordinary course of business” (ss. 29(2), and 30(1) CEA) in regard to its records system;
• email is not classified, indexed nor pruned, or possibly not retained; there is no “email protocol” operative throughout the organization;
• records repositories are not well defined nor centrally accessible;
• no central policy for records management thus allowing the many divisions of the organization each to operate its own independent records system according to its own rules and practices;
• original paper records are not disposed of after being put into digital storage in a secure records management environment (with the exception of industry, professional, or special legal requirements as to retaining designated originals);
• image quality is not verified when original paper records are converted to electronic images, and there is no imaging manual dealing with the technical requirements for scanning paper records into electronic storage;
• metadata (data about data – data as to the management of records through time) is not used, therefore the biographical and bibliographical information about records is not used and properly maintained, therefore, e.g., there are extensive duplicates and an inability to track official or original versions;
• no audit trails or controls detailing deletions, i.e., when, who, by what retention-destruction/disposal authority?;
• no clear definition and practice as to what is the “deletion” of a record such that, e.g. records may or may not continue to exist in backup storage thus diminishing knowledge of the extent of records holdings and their control;
• changes in technology have resulted in unaccounted for, and undocumented changes in records practice;
• no consistent practice as to other forms of communication that create records, e.g., video and audio recordings, instant messaging, cellphone (mobile) communications;
• no “retention and disposal” program for records lifecycles;
• years after a merger or acquisition, the records system is still operating according to the conflicting rules of its component parts;
• no chief records officer with clearly defined and adequate authority;
• “orphaned data,” i.e., records that can no longer be retrieved or read because the new technology that now operates the records system is incompatible with the old technology that created those records (a “migration program” should accompany the installation of new technology);
• poor security protection;
• inadequate compliance with the records management requirements of the privacy laws;
• inadequate testing, auditing, and quality control;
• substantial non-compliance with the National Standards of Canada for records management, and a lack of appreciation of the consequences of non-compliance.

These defects are frequently found in the ERMS’s of all organizations because: (1) there is no law of general application requiring ERMS’s be maintained in compliance with any standard, such as Canada’s national standards; (2) many organizations find that they can “get along just fine” using only their most recently made and received records, therefore they neglect ERMS maintenance; and, (3) ERMS’s are brought into compliance with the national standards just for litigation purposes, therefore pre-existing records loses and record sources cannot be known. Therefore: (1) the “prime directive” of the national standards states: “an organization shall always be prepared to produce its records as evidence”; and, (2) the proof of “records system integrity” required by the electronic records provisions is very necessary. But both are ignored.

Electronic discovery is not used to test the quality of ERMS’s. Therefore it doesn’t investigate such defects, or the state of electronic records management, or the quality of the software that operates it. And therefore, given the complexity of ERMS’s it has no capacity to judge the adequacy or honesty of production.

And the distance between discovery’s and admissibility’s simplicity and reality’s complexity is aggravated by the fact that organizations are moving away from centralized ERMS’s. Records systems are becoming a network of applications existing in-house, in mobile devices, and in centralized, shared utility services such as “the cloud.” Records do not sit in a single records management system. They constantly move among systems; transmission creating a “weak link” as to proving integrity. Therefore, rather than focusing on in-house ERMS’s, laws and records management standards will have to focus on records management, and on the amount of control embedded in records management policies and procedures. Going from paper to electronic records will require as much change in our legal infrastructure as going from horses to motor vehicles.

2. Software errors and vulnerabilities are very prevalent and costly

Also ignored are the numerous errors in the software that all ERMS’s depend upon. Many operate on several million lines of software code, and it has an error rate as do most things created by people. For example, the Windows 3.1 operating system has close to 3 million lines of software code. The Google Chrome web browser has approximately 5 million lines. The Firefox browser is near 10 million, and Windows 7 has under 40 million lines of code, which is a little less than Windows XP, and more than 10 million less than Windows Vista. And an Android phone has more than 12 million lines of code. In regard to breathalyzer machines, the Draeger 7110 device has 53,774 lines of code that print out on 896 pages. Applying the industry average of 25 errors per 1,000 lines of software code, there are potentially 1,344 defects in that code. A 2002 study commissioned by the U.S. Department of Commerce’s National Institute of Standards and Technology (NIST) concluded that, “software errors cost the U.S. economy $59.5 billion annually.” Many of the “updates” we receive for computer programs are corrections to software code. All devices, electronic or otherwise, must be assumed to be prone to error such that the evidence they provide should not be accepted as reliable, unless there is expert opinion evidence, or other form of authoritative certification of their reliability.

3. The impact upon case law

The state of management of a pre-electronic paper records management system cannot affect the existence, accessibility, and integrity of a paper record. Paper records are not affected by the state and use of all the file drawers and boxes used in a paper records system. That is why records system issues are absent from the pre-ERMS case law. But because of the defects listed above, they definitely should not be absent, as they are, from the ERMS case law concerning the discovery and admissibility of electronic records. There is therefore, very likely to be an unacceptably high probability of judgments being based upon inadequate and faulty evidence if the use of ERMS technology to produce records as evidence is not adequately reviewed. An exception is, Siemens Canada Limited v. Sapient Canada Inc. 2014 ONSC 2314, [2014] O.J. 1930, at paras. 156-57 (OSC-Master, April 23, 2014). See also Martin Felsky’s analysis.

4. The concepts and principles necessary for the use of electronic records as evidence

The three analogies: (1) whereas a pre-electronic paper record can be symbolized by a piece of paper in a file drawer, an electronic record is like a drop of water in a pool of water, i.e., it is completely dependent upon its ERMS for its existence, accessibility, and “integrity” (as that word is used in the electronic records provisions of the Evidence Acts; e.g. s. 31.2(1)(a) CEA); (2) if expert opinion evidence were rendered admissible in the way that electronic records are, there would be no evidence presented, nor cross-examination allowed, as to the qualifications of the expert witnesses, i.e., the “qualifications” of an electronic record being the state of records management of the ERMS in which it is stored; (3) going from a horse-powered transportation system to a motor vehicle-based transportation system has required a vast amount of new laws, regulations, and enforcement personnel, including police officers, judges, and lawyers, i.e., stepping up to a new technology requires that it be controlled by new laws and regulations, otherwise it will cause injury, damage, and injustice.

Therefore, good electronic records management is not just a “helpmate” to adequate discovery and admissibility proceedings; it should be a condition-precedent to the success of those proceedings. The text, The Sedona Canada Principles—Addressing Electronic Discovery is based upon the former, but the latter is required by the nature of electronic records and their ERMS technology and its consequences for the law.

The “triangle of interdependent concepts” for the use of electronic records as evidence: (1) the “system integrity concept”; (2) the “prime directive” of the national standards; and, (3) the “proportionality principle” by which demands for production are controlled in electronic discovery proceedings.

The “triangle of interdependent proceedings”: (1) electronic discovery proceedings; (2) admissibility proceedings concerning electronic records as evidence; and, (3) proof of compliance with Canada’s national standards.

5. The divisions of work of the records management lawyer

1. Legal opinions as to the ability of electronic records management systems (ERMS’s) to satisfy the electronic records demands as to:

(a) electronic discovery;

(b) admissibility of electronic records as evidence;

(c) electronic commerce laws;

(d) privacy and access to information laws;

(e) records requirements of the major tax laws;

(f) compliance with the national standards.

Because ERMS’s are catch-all reservoirs of electronic records, they reflect all significant changes within their organizations. Such legal opinions would therefore be routinely provided at least once annually, and also in relation to every significant change to an ERMS. And they would accompany the reports of experts in ERMS technology. Part of such reports would deal with compliance with the national standards. Such legal opinions would also deal with special records requirements imposed by regulatory agencies or specialized legislation applicable to particular industries or professions. Experts in ERMS technology have done such work for many years, and I have written the accompanying legal opinions.

2. Aiding clients to develop indexing systems for all of their records (i.e., “Solving the High Cost of the “Review” Stage of Electronic Discovery”). As required by the national standards, all significant records within a client’s ERMS should be indexed. A well indexed ERMS can provide as much useful information for an organization as do its financial records. The “records management law” specialist teaches clients indexing and the database discipline that it makes possible. (See my article on indexing.) Then, the accessing and “reviewing” of clients’ records for relevance and privilege, can be done together as one operation, by the litigation or records management lawyer, using the speed of electronic searching applied to the client’s indexing system. Clients would not need to be involved. The reading of records for relevance and privilege would be greatly reduced.Similarly, when legal research is done by lawyers (more often by their students), the accessing and reviewing of relevant materials is much reduced in time and cost because: (1) of the highly indexed, headnoted, abstracted, and summarized nature of legal materials; (2) the searching is done by experts in legal research—lawyers and their students; and, (3) the searching is done with the speed provided by electronic searching. As a result, a “proportionality principle” is not needed to control the amount of legal research that parties inflict upon one another. Thus the “high cost of the review stage problem” of electronic discovery would disappear if such benefits were brought to clients’ ERMS’s. And the need for electronic discovery’s “proportionality principle” would be greatly reduced. Such would be part of the “due diligence” work done by a lawyer specialized in records management law, or ensure that it was done, and to instruct the client as to the needed database preparation. Clients will do it, if shown that it will help fulfill their goals. Accessing, sorting, and reviewing records is far more cost-efficiently done by way of a “front end” indexing of records than by a “back end” reading of records as the “review stage” requires now.Also, indexing is well justified because searching a database of texts (instead of its index, if there is one) is very inaccurate; see: Victoria L. Lemieux and Jason R. Baron, “Overcoming the Digital Tsunami in e-Discovery: is Visual Analysis the Answer?” (2012), 9 Canadian Journal of Law and Technology 33 at 35. That casts doubt upon the efficacy of “predictive coding” and other “technology assisted review” devices, used to reduce the cost of the “review” stage of electronic discovery.[ii]

   All of the functions set out in this section must be taken cumulatively so as require an on-going relationship with institutional clients, thus establishing “records management law” as a new and profitable area of the practice of law, and the “records management lawyer” as an essential specialist.

3. Provide the “due diligence” to maximize the efficacy of electronic discovery and admissibility proceedings. Currently these proceedings do not provide any incentive for records management that is compliant with the national standards. The “proportionality principle” and Sedona Canada apply to what the lawyers do in electronic discovery, but they do not apply to what the parties do in regard to the quality and serious defects of their ERMS’s. There should be a “duty of due diligence” that the lawyers for the parties perform so as to provide a legally recognized power of assurance that the records systems are capable of providing adequate and fair discovery. Such is analogous to similar “due diligence” duties of lawyers in other fields of practice.[iii] That could forestall an order for the examination of a party’s ERMS by a third party expert, when such becomes the practice of the courts. Non-compliance with the national standards should give rise to a rebuttable presumption of a lack of “system integrity,” and therefore of inadmissibility and inadequate discovery. But because the complexity of ERMS technology is ignored, there is no means of judging the efficacy of electronic discovery proceedings, which are not evolving to cope. Prevention of the consequences of bad records management upon the efficacy of legal proceedings is essential because the complexity of ERMS technology makes the detection of those consequences very improbable and of rare occurrence.
4. Knowledge of case law and search techniques to eliminate court applications as to the adequacy of “production,” during discovery proceedings. Needed is a procedure that provides a safeguard against inadequate searching of and production from ERMS’s that are not capable of providing adequate access to all relevant records. Such monitoring of search capabilities, techniques, and technology by opposing counsel would be part of the work of the records management lawyer. Knowledge of all cases law, including that concerning search and seizure will be required. Electronic records and their records systems have to be challenged as to their “integrity” and adequacy just as much as do witnesses. Therefore examination-on-discovery of opposing parties, including their affidavits, is the necessary substitute for access to an opponent’s ERMS. Now, issues as to the state of electronic records system management are ignored by lawyers, barred by judges, and therefore, with but very rare exception, absent from Canada’s case law on electronic discovery.
5. Working with experts in ERMS’s, to perform contracts for the repair, alteration, and creation of ERMS’s by providing the accompanying legal opinions as to client organizations’ ability to comply with the records management requirements. Now, such contracts are obtained by competitive bidding by independent groups of records management experts—see the MERX website for public tendering. Therefore, they are providing “legal information” where lawyers should be providing legal advice. Instead, that “bidding for contracts system” should be displaced by making such work part of law firms’ continuing legal services to clients, i.e., a “preventive law” service, instead of only “remedial law” services concerning litigation and disputes. Therefore ERMS experts and records management lawyers should be working closely together. Those organizations using the services of a records management lawyer would not need to put such work out for competitive bidding.
6. Assisting litigation counsel in dealing with electronic discovery problems, particularly: (1) its “review” stage; (2) when a “litigation hold” should be imposed; (3) privacy and access to information issues; (4) records management procedures and standards, in particular, the compliance requirements of the national standards; (5) what ERMS information should be demanded from and provided to opposing parties; and, (6) court-imposed penalties for spoliation and other forms of obstruction.[iv] Such assistance would include teaching or conducting the review stage by use of predictive coding or other “technology assisted review” (TAR) devices. As to the cost, rules of electronic discovery will be enacted with which to penalize parties when inadequate records management interferes with electronic discovery or otherwise damages parties’ interests. By thus incorporating issues as to “the quality of records management” into the law of electronic discovery: (1) discovery is made more effective; (2) is much better equipped to control its costs; and, (3) able to reduce the time and expense of admissibility of evidence proceedings. Because of the cost of litigation, the “electronic discovery lawyer” will evolve to become the “records management lawyer,” and a necessary support service available to all lawyers, if litigation is not to be restricted to the rich.
7. Providing clients with “preventive legal services” instead of only remedial legal services, i.e., legal services that prepare the client for litigation before it happens, and for examinations of ERMS procedures by government officials and regulatory bodies. Of particular importance, because ERMS’s are constantly changing, yearly opinions should be provided as to: compliance with the national standards for electronic records management, especially “the prime directive.” And making clients sufficiently knowledgeable as to:

(1) the records management and legal requirements of the national standards;

(2) all the laws and regulations that create records requirements, particularly the laws of, evidence, electronic discovery, privacy and access to information, electronic commerce, and taxation;

(3) the legal consequences of electronic records management systems changing as their organizations and operations change; and,

(4) the consequences of more laws based upon technology; and the fact that almost every electronic communication, interaction, and service automatically creates a record that is potentially evidence and relevant to some legal service.

Therefore, clients who have large ERMS’s should be advised to have them certified by experts in records management as being in compliance with the national standards, at least once per year, and immediately after any significant change to an ERMS; e.g., mergers and acquisitions making necessary the melding of two ERMS’s into one, or any reorganization or creation of an ERMS. Then, failure to produce such certification, or other evidence as to compliance, should raise a rebuttable presumption of inadequate production on discovery, and inadmissibility of electronic records as evidence. By means of such certification, issues concerning compliance with the national standards could be dealt with quickly by a simple exchange of certificates of compliance. The onus of proof would thereby be placed upon the possessor of the ERMS, rather than upon an opponent to show that the other party’s records management has caused inadequate production on discovery, and an inability to satisfy the requirements of admissibility.

Two of the four records management components for such a certification process are already in place: (1) Canada has authoritative national standards for electronic records management, which are based upon well established international standards; and, (2) there is a well developed profession of experienced experts in ERMS technology. The other two can easily be put in place: (3) a procedure whereby the Canadian General Standards Board, being the federal government agency that develops and maintains such national standards, can licence such experts individually, as being competent to provide certifications of compliance with the national standards; and, (4) a standard form of certificate, placed in the national standards, for certifying compliance with them.

8. To make litigation available to people of average incomes. The “records management lawyer specialist” should be a support service available to all law firms. Now, the cost of the “review” stage of electronic discovery proceedings puts litigation that involves large volumes of records, beyond the means of the majority of the population (even if the use of “technology assisted review” software, such as incorporated within predictive coding devices, becomes routine). Such a support service is the best strategy for adequately reducing the cost of electronic discovery in particular, and litigation in general.

Now, instead of the legal profession providing such legal services, the records management profession is providing general legal information, including information on the “legal requirements” of the national standards for electronic records management, and not involving lawyers in their work. Their clients don’t realize that they should be using such legal services. Such is also true of their legal departments, as is shown by the absence of ERMS issues in almost all case law and guidelines concerning the use of electronic records as evidence, including the four Sedona Canada Principles texts; see: Why a Legal Opinion is Necessary for Electronic Records Management Systems,” (2012), 9 Digital Evidence and Electronic Signature Law Review 17 (pdf).

One of the reasons why the “prime directive” of the national standards requires records systems always be ready to provide their records as evidence, is that the state of records management when records are created and stored and continuously thereafter, is always determinative of their continued existence, accessibility, and integrity for electronic discovery proceedings, and their ability to be admissible evidence. “Records integrity” is not a requirement for merely a single point in time, but rather a continuous requirement up to the time records are to be used for any legal purpose. Therefore, bringing an ERMS into compliance with the national standards, provides no information as to the continued existence, accessibility, and integrity of its records before compliance was achieved.

All of the above functions of the records management lawyer will establish not only an on-going fiduciary duty with institutional clients, but also a continuous duty of “due diligence.” ERMS technology will require at least as much legal infrastructure as do motor vehicles. That will make the records management lawyer a much-needed specialist and records management law a much-needed specialty.

6. In summation, “records management law” will bring these necessary innovations as part of the legal infrastructure controlling the use of electronic records technology:

(1) the use of the National Standards of Canada for electronic records management to provide the definition and principles necessary for the effective and cost-efficient operation of the electronic records provisions in the Evidence Acts in Canada (their “integrity of the electronic records system” test of admissibility), instead of that need for a definition being ignored;

(2) the creation of a simple and cost-efficient certification process for proof of compliance with those national standards, which process would facilitate such use of the national standards;

(3) changing the strategy for reducing the cost of electronic discovery and admissibility proceedings, from the current “cutting costs by cutting competence” strategy of ignoring ERMS technology—the inadequate competence of case law to provide accurate results—to a strategy that does not deny the nature and dangers of the technology upon which such proceedings are based;

(4) a method for reducing the cost of the “review” stage of electronic discovery proceedings;

(5) increasing the ability of the law to render accurate and just results by use of the “triangle of interdependent concepts” for the use of electronic records as evidence. Its purpose is to maximize the efficacy of the “triangle of interdependent proceedings.”

(6) revising the records provisions of the Evidence Acts in Canada in support of these innovations by adding a “rebuttable presumption of inadequacy,” so as to enforce proof of compliance with the National Standards of Canada for electronic records management;

(7) the creation of the “records management lawyer” specialist, necessary for implementing the specialized field of “records management law,” as a means of controlling the costs of litigation and regulating the use electronic records management technology so as to mitigate the consequences of its dangers and weaknesses.

These innovations are necessary: (1) to give electronic records and their ERMS technology an adequate legal infrastructure for litigation and other legal services; and, (2) to make litigation that is dependent upon the use of records, available at reasonable cost.

This post is but a brief summary of a forthcoming article in the Canadian Journal of Law and Technology. See also: “The Sedona Canada Principles are Very Inadequate on Records Management and for Electronic Discovery”; and my Feb. 12^th Slaw post, Electronic Discovery: The Concept and Purpose of the Sedona Canada Principles 2nd Edition, and, “Electronic Records as Evidence,” and the other records management articles listed on my SSRN author’s page.

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[i] The national standards are: (1) Electronic Records as Documentary Evidence CAN/CGSB-72.34-2005 (“72.34”), published in 2005; and, (2) Microfilm and Electronic Images as Documentary Evidence CAN/CGSB-72.11-93 (“72.11,” updated to 2000, but which has remained the ERMS industry standard for “imaging” procedures, i.e., the large industry for converting original paper records to electronic storage).

[ii] See the detailed description of the use of predictive coding devices in, Dynamo Holdings Ltd. Partnership v. Commissioner of Internal Revenue (U.S. Tax Court, Nos. 2685-11, 8393-12, Sept. 17, 2014); online: <http://goo.gl/NiY7XY> (click “available here” at the bottom of the page). And it is mentioned in, L’Abbé v. Allen-Vanguard Corp. 2011 ONSC 7575, [2011] O.J. No. 5982, at para. 23.

[iii] For example: (1) the required due diligence in regard to the disclosure of financial assets for the making of family law separation agreements. It has been held by the Supreme Court of Canada that a lawyer’s due diligence is needed because, “Non-disclosure of assets is the cancer of matrimonial property litigation”: Leskun v. Leskun, 2006 SCC 25, [2006] S.C.J. No. 25, Binnie J. for the Court, at para. 34. And, (2) due diligence is required for the use of “cloud computing” (a third party “utility type” service provider of electronic data storage and processing); see the Report of the Cloud Computing Working Group, Appendix 1 “Due Diligence Guidelines” (p. 29), January 27, 2012, of the Law Society of British Columbia.

[iv] A beginning of this specialized practice is the appointment of electronic discovery expert lawyers by larger law firms. See for example this announcement on August 6, 2013, by Borden Ladner Gervais LLP, a law firm having more than 750 lawyers across Canada: “BLG hires Canada’s leading electronic discovery lawyer,” Martin Felsky.