Boiling Frogs, Privilege and Professional Conduct

Forty years ago, the confidentiality rule now found in the Federation of Law Societies Model Code was first adopted in the CBA Code of Professional Conduct. The confidentiality rule makes passing reference in the commentary to privilege and makes clear that the confidentiality rule must be distinguished from solicitor-client privilege. The Model Code does not expressly require that lawyers uphold solicitor-client and litigation privilege.

I expect that Canadian lawyers would generally accept that proper professional conduct includes upholding solicitor-client and litigation privilege. After forty years, it is appropriate to question whether the Codes and Rules of Professional Conduct ought to say just that and to ensure that the confidentiality rule and privilege work sensibly together[i].

Solicitor-client privilege and litigation privilege are fundamental for Canadian lawyers

Over the last two decades, the Supreme Court of Canada has repeatedly emphasized the importance of solicitor-client privilege. Most recently, Justice Cromwell wrote in Canada (Attorney General) v. Federation of Law Societies of Canada, [2015] 1 SCR 401 that:

[82] … The centrality to the administration of justice of preventing misuse of the client’s confidential information, reflected in solicitor-client privilege, led the Court to conclude that the privilege required constitutional protection in the context of law office searches and seizures: see Lavallee. Solicitor-client privilege is “essential to the effective operation of the legal system”: R. v. Gruenke, [1991] 3 S.C.R. 263, at p. 289. As Major J. put it in R. v. McClure, [2001] 1 S.C.R. 445, at para. 31: “The important relationship between a client and his or her lawyer stretches beyond the parties and is integral to the workings of the legal system itself” (emphasis added [by Cromwell J.]).

Canadian law now recognizes litigation privilege as a privilege separate and apart from solicitor-client privilege. In Blank v. Canada (Minister of Justice), [2006] 2 SCR 319, Justice Fish wrote that:

[27] Litigation privilege, on the other hand, is not directed at, still less, restricted to, communications between solicitor and client. It contemplates, as well, communications between a solicitor and third parties or, in the case of an unrepresented litigant, between the litigant and third parties. Its object is to ensure the efficacy of the adversarial process and not to promote the solicitor-client relationship. And to achieve this purpose, parties to litigation, represented or not, must be left to prepare their contending positions in private, without adversarial interference and without fear of premature disclosure.

Solicitor-client privilege and litigation privilege are undoubtedly of fundamental importance in the work of Canadian lawyers. Solicitor-client privilege protects communications between Canadian lawyers and their clients in support of the lawyer-client relationship and the legal system. Litigation privilege protects our adversarial system of which lawyers are a very important part.

Given the importance of solicitor-client privilege and litigation privilege, few would likely doubt that Canadian lawyers have an ethical obligation to uphold these important privileges. Yet the Model Code and the Law Society Codes and Rules of Professional Conduct (the “conduct rules”) contain no such express requirement.

This is surprising but explicable as a matter of history.

The source of the ethical confidentiality rule

Over forty years ago, the Canadian Bar Association Special Committee on Legal Ethics delivered its Preliminary Report on the Code of Professional Conduct. The Special Committee proposed the following Confidentiality Rule:

The lawyer has a duty to hold in strict confidence all information acquired in the course of the professional relationship concerning the business and affairs of his client, and he should not divulge any such information unless he is expressly or impliedly authorized by his client or required by law to do so.

Despite its age, this Confidentiality Rule should look familiar to Canadian lawyers. The Federation of Law Societies Model Rule 3.3-1 today provides that:

A lawyer at all times must hold in strict confidence all information concerning the business and affairs of a client acquired in the course of the professional relationship and must not divulge any such information unless:

(a) expressly or impliedly authorized by the client;

(b) required by law or a court to do so;

(c) required to deliver the information to the Law Society; or

(d) otherwise permitted by this rule

There is no difference between the Confidentiality Rule adopted by the CBA in the 1970s and Model Rule 3.3-1 which reflects the conduct rules across Canada in 2016.

The 1970s Confidentiality Rule addressed privilege in the commentary indicating that:

This ethical rule must be distinguished from the evidentiary rule of solicitor and client privilege with respect to oral or documentary communications passing between the client and his lawyer. The ethical rule is wider and applies without regard to the nature or source of the information or the fact that others may share the knowledge.

This commentary is effectively repeated in Model Code as follows. The only change in the Model Code commentary is a limited recognition of the significant evolution of solicitor-client privilege in Canadian law since the 1970s.

This rule must be distinguished from the evidentiary rule of lawyer and client privilege, which is also a constitutionally protected right, concerning oral or documentary communications passing between the client and the lawyer. The ethical rule is wider and applies without regard to the nature or source of the information or the fact that others may share the knowledge.

It is perhaps explicable that the 1970s CBA Code did not include an ethical obligation of Canadian lawyers to uphold a mere, albeit important, evidentiary privilege. But the law of privilege has evolved materially since then reflecting fundamental policy objectives of signal importance to Canadian lawyers and our legal system.

Evolution of Canadian law since the 1970s

The modern evolution of solicitor-client privilege can be seen to have started Solosky v. The Queen, [1980] 1 SCR 821. As Justice Dickson, as he then was, wrote:

Recent case law has taken the traditional doctrine of privilege and placed it on a new plane. Privilege is no longer regarded merely as a rule of evidence which acts as a shield to prevent privileged materials from being tendered in evidence in a court room. The courts, unwilling to so restrict the concept, have extended its application well beyond those limits.

In 1982, the Supreme Court again addressed and advanced solicitor-client privilege in Descôteaux et al. v. Mierzwinski, [1982] 1 SCR 860.

The next significant case in the Supreme Court of Canada addressing lawyer-client confidences was MacDonald Estate v. Martin, [1990] 3 SCR 1235. Justice Sopinka, for the majority, established the modern principles for protecting confidential information attributable to a solicitor-client relationship. Significantly, Justice Sopinka invited the “governing bodies” to consider adopting conduct rules for confidentiality screens to displace the presumption that lawyers who practice together will discuss their cases. This was done in the 1990s. The conduct rules now include rules governing transferring lawyers and confidentiality screens.

Since MacDonald Estate, there has been deep consideration of solicitor-client privilege and litigation privilege in the Supreme Court of Canada as can be seen from the following lengthy (and incomplete) case list:

• Smith v. Jones, [1999] 1 SCR 455
• R. v. Campbell, [1999] 1 SCR 565
• R. v. McClure, [2001] 1 SCR 445
• R. v. Brown, [2002] 2 SCR 185
• Lavallee, Rackel & Heintz v. Canada (Attorney General), [2002] 3 SCR 209
• Maranda v. Richer, [2003] 3 SCR 193
• Foster Wheeler Power Co. v. Société intermunicipale de gestion et d’élimination des déchets (SIGED) inc., [2004] 1 SCR 456
• Pritchard v. Ontario (Human Rights Commission), [2004] 1 SCR 809
• Goodis v. Ontario (Ministry of Correctional Services), [2006] 2 SCR 32
• Celanese Canada Inc. v. Murray Demolition Corp., [2006] 2 SCR 189
• Blank v. Canada (Minister of Justice), [2006] 2 SCR 319
• Canada (Privacy Commissioner) v. Blood Tribe Department of Health, [2008] 2 SCR 574
• R. v. Cunningham, [2010] 1 SCR 331
• Ontario (Public Safety and Security) v. Criminal Lawyers’ Association, [2010] 1 SCR 815
• Attorney General of Canada v. Federation of Law Societies, [2015] 1 SCR 401

Yet while the law of solicitor-client privilege and litigation privilege has significantly evolved, the conduct rules have not changed in response other than to add a transferring lawyer rule[ii]. The confidentiality rule is unchanged over more than 40 years. The conduct rules do not explicitly require lawyers to uphold these privileges.

This is reminiscent of the old story of the frog in the pot of boiling water[iii]. If we were starting out to draft confidentiality rules in 2016, it is difficult to imagine that lawyers would not be required to uphold the privileges that are so fundamental to the work of lawyers and the legal system. While the changes in the law of privilege are very significant, they have developed over a prolonged time. It is understandable that the conduct rules have remained unchanged.

So what?

Readers can be forgiven for asking why any of this matters. Lawyers who abuse privilege can generally be held accountable under the ethical confidentiality rule and also under other more general conduct rules. But there is advantage in clarity so that lawyers are guided by the conduct rules rather than the conduct rules being a trap for the unwary. It is also clear that teaching law students and lawyers about confidentiality under the conduct rules and about legal privilege is difficult and confusing given the current rules. I doubt that many really understand the interplay of these obligations.

There are other advantages to changing the conduct rules to expressly include an obligation to uphold these privileges. The amendment process would necessarily cause apparent inconsistencies between the ethical confidentiality rule and the privileges to be addressed. For example:

• Solicitor-client privilege does not protect information covered by the crime-fraud exclusion. Does the ethical confidentiality rule cover or exclude that information? Does privilege permit disclosure while the conduct rules prohibit disclosure?
• The “innocence at stake” exception to solicitor-client privilege is not reflected in the conduct rules. Does the ethical confidentiality rule prohibit use of confidential information where solicitor-client privilege yields to protect life, liberty and security of the person?
• The conduct rules allow lawyers to use client information to protect themselves from claims by third parties even where the innocence-at-stake exception does not apply. Do the conduct rules permit that which solicitor-client privilege does not?[iv]
• The conduct rules protect confidential information under the former client rule and the transferring lawyer rule. Does this/should this include information that is not privileged?
• The law of privilege protects the privileged information of third parties even by disqualifying lawyers who do not act for them[v]. The conduct rules only address confidentiality in terms of client protection. Should the conduct rules expressly address protection of third party privilege?

There may be other issues that would emerge from a careful review of the conduct rules. While the answers to some of the questions just posed seem obvious, the answer to others may be less clear.

But after forty years, the context of the conduct rules has gradually changed over time such that what was appropriate forty years ago may not be appropriate now. It would be hyperbolic to say that the water is now boiling[vi], but we are in quite a different world so far as protection of information in the legal system is concerned. It is worth reconsidering a rule which pre-dates the careers of most of the lawyers now in practice.

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[i] Privilege being the jurisdiction of the courts, it would be for the law societies to reconcile the confidentiality rule rather than to pretend to the authority to change privilege

[ii] Strictly speaking, the former client rule also changed in response to MacDonald Estate

[iii] Apparently, frogs actually do notice gradual temperature increases and try to escape from the pot. Perhaps lawyers and law societies can react to gradual change as well?

[iv] Gavin Mackenzie, Lawyers and Ethics: Professional Responsibility and Discipline, 4th ed. (Toronto: Carswell, 2006) at 3-15 to 3-17

Adam Dodek, Solicitor-Client Privilege in Canada: Challenges for the 21st Century, (Discussion paper for the CBA, 2011) at pp. 11 and 12

See also Wilder v. Ontario Securities Commission (2001), 53 OR (3d) 519 (OCA) at paras. 33 and 34. Professor Dodek suggests that Sharpe JA may treat the Rules of Professional Conduct as authorizing defensive use of privileged information.

I addressed this question in Professional Conduct Rules and Confidential information versus Solicitor-Client Privilege: Lawyers’ Disputes and the use of Client Information, (2015) 92 Can. B. Rev. 595

[v] Celanese Canada Inc. v. Murray Demolition Corp., [2006] 2 SCR 189 and Stewart v. Humber River Regional Hospital, 2009 ONCA 350

[vi] Or, to mix metaphors, that we are not in Kansas anymore!