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{ PRIVILEGE PRIMER }

ChAllenges to priVilege in the

internAl inVestigAtion Context

By Paul Le Vay, Gerald Chan and Carlo Di Carlo

Consider the following scenario: Several employees have made dio recordings of a witness interview (or
allegations of fnancial irregularities against a senior offcer of a transcript thereof) can reveal counsel’s
observations and opinions—exactly what
the corporation. The General Counsel (or Board of Directors) litigation privilege is intended to protect.
determines an internal investigation is warranted. External A large part of the confusion stems
from the axiom, “Facts are not privileged.”
counsel is retained to conduct it, and they interview dozens This should not prevent counsel from
of witnesses. Is the investigative brief privileged? claiming privilege over a document cre-
ated in the course of an investigation just
because it summarizes facts. Rather, this
he frst question is whether the wit- dian courts have struggled to answer these should simply mean other parties are free
nesses interviewed are employees questions with consistency and clarity. to approach the same witnesses to elicit
tor external third parties. In the for- In Alberta v. Suncor Energy Inc., the the same facts. Unfortunately, that was not
mer, solicitor-client privilege may ap- Court of Queen’s Bench of Alberta found the approach taken in Assessment Direct.
ply on the basis that counsel are gather- litigation privilege applied to witness The scope of privilege in the internal
ing facts from the client for the purpose statements taken as part of an internal in- investigation context is an issue sorely in
of providing legal advice. In the latter, vestigation (in that case, an investigation need of guidance from the Supreme Court
solicitor-client privilege would not apply into a workplace accident resulting in the of Canada. However, until such guidance
because the communications are not be- death of an employee). While the Court of is provided, in-house counsel need to be
tween solicitor and “client,” but litigation Appeal altered the ruling on appeal, it did sure external counsel are aware of the po-
privilege may apply if the investigation so on other grounds. tential pitfalls awaiting privilege claims
is conducted for the dominant purpose By contrast, in R. v. Assessment Direct and take the appropriate steps to structure
of preparing for anticipated or existing Inc., the Ontario Superior Court of Justice the investigation to maximize the likeli-
litigation. A recent case out of the U.K. ruled litigation privilege did not apply to hood these claims will be successful. ❚
(Director of the Serious Fraud Offce v. Eur- audio recordings of witness interviews
asian Natural Resources Corporation Ltd.) that were conducted in anticipation of
found the dominant purpose test was met civil and criminal litigation. In coming
even though the authorities were still in- to this conclusion, the court appeared to
vestigating and had not yet commenced a draw a bright line between documents
criminal prosecution. It was enough that containing facts and documents reveal-
there was a “real likelihood” of litigation. ing counsel’s “observations, thoughts and
A thornier issue concerns the scope opinions,” placing the recordings in the
of solicitor-client or litigation privilege former category. Paul Le Vay, Gerald Chan and Carlo Di Carlo are
where it applies. Privilege clearly protects It is hard to reconcile this bright-line lawyers at Stockwoods LLP (stockwoods.ca), a
litigation boutique with expertise across the spec-
any legal advice given or legal strategy approach with the rationale underlying trum of civil, regulatory and criminal litigation.
recorded. But does it protect counsel’s litigation privilege. A witness might never They have conducted investigations on behalf of
notes of a witness interview if those notes have been interviewed but for counsel’s clients ranging from large fnancial institutions to
simply summarize what was said? What analysis and judgment. In addition, the publicly traded companies and governmental enti-
if counsel hired a court reporter? Does contents of that interview, its focus and the ties. These include investigations in the areas of
privilege protect the audio recordings structure of the questions are all shaped workplace harassment, whistleblower intimidation
and transcripts of the interviews? Cana- by counsel’s judgment. And so even au- and fnancial irregularities.

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