Judgments

[1994] 1 F.C. 801

T-2105-93

John Labatt Limited and Labatt Brewing Company Limited (Plaintiffs) (Defendants by Counterclaim)

v.

Molson Breweries, A Partnership (Defendant) (Plaintiff by Counterclaim)

Indexed as: John Labatt Ltd. v. Molson Breweries (T.D.)

Trial Division, Strayer J.—Ottawa, December 7 and 13, 1993.

Practice — Discovery — Production of documents — Application for order requiring delivery of unexpurgated copies of documents listed in plaintiffs’ affidavits of documents — Documents listed in affidavits of documents delivered containing deletions — Plaintiffs asserting deletions irrelevant to litigation, but relating to confidential matters of great commercial value — Application dismissed — Obligation under R. 448 to disclose in affidavit of documents only documents “relevant to any matter in issue” — Once whole of document without exception described as relevant in affidavit of documents, prima facie duty to produce whole of document pursuant to R. 452(3), unless Court persuaded to exercise discretion in interest of justice when application for enforcement made — Affidavit of documents can be corrected as long as correction made without delay (R. 451) — Plaintiffs to file revised affidavit describing as precisely as possible portions of documents considered irrelevant — Appropriate procedure for defendant to question plaintiffs about deletions on examination for discovery and, if appearing relevant, should demand production as part of discovery — Although successful, plaintiffs to pay costs of motion as responsible for difficulties herein.

STATUTES AND REGULATIONS JUDICIALLY CONSIDERED

Federal Court Rules, C.R.C., c. 663, RR. 407(2), 448 (as am. by SOR/90-846, s. 15), 451 (as am. idem), 452(3), (4) (as am. idem), 453(2) (as am. idem).

CASES JUDICIALLY CONSIDERED

REFERRED TO:

Kimberly-Clark Corp. v. Proctor & Gamble Inc. (1990), 31 C.P.R. (3d) 207 (F.C.T.D.); United States Surgical Corporation v. Downs Surgical Canada Ltd., [1982] 1 F.C. 733; (1981), 129 D.L.R. (3d) 209; 62 C.P.R. (2d) 67 (T.D.); Amfac Foods Inc. v. C.M. McLean Ltd., [1981] 2 F.C. 9; (1980), 48 C.P.R. (2d) 143 (T.D.); Janhevich et al. v. Thomas (1977), 15 O.R. (2d) 765; (1977), 76 D.L.R. (3d) 656; 3 C.P.C. 303 (H.C.); Collins v. Beach (1988), 24 C.P.C. (2d) 228; [1988] 1 C.T.C. 261 (Ont. H.C.); Manufacturers Life Insurance Co. v. Dofasco Inc. (1989), 38 C.P.C. (2d) 47 (Ont. H.C.).

APPLICATION for order requiring delivery of unexpurgated copies of documents listed in plaintiffs’ affidavits of documents. Application dismissed.

COUNSEL:

Thomas R. Kelly for plaintiffs.

Elizabeth G. Elliott for defendant.

SOLICITORS:

Smart & Biggar, Ottawa, for plaintiffs.

Macera & Jarzyna, Ottawa, for defendant.

The following are the reasons for order rendered in English by

Strayer J.:

Relief Requested

The defendant seeks an order requiring the plaintiffs to deliver copies, in their entirety, of the documents listed in the plaintiffs’ affidavit of documents. Incidental relief is also requested.

Facts

The reason that this matter is before the Court is that the plaintiffs each filed affidavits of documents listing what they described as the “relevant documents” as required by Rule 448 [Federal Court Rules, C.R.C., c. 663 (as am. by SOR/90-846, s. 15)]. When called upon to deliver copies of these documents, as they are obliged to do under Rule 452(3) [as am. idem], they delivered what are in some cases expurgated versions of the documents. It is apparent that there have been deletions although in some cases the existence or the extent of such deletions is unclear. The defendant, realizing that there were deletions from the documents delivered, immediately filed this motion.

The plaintiffs resist the motion on the basis that the deleted material is not relevant to this litigation and is of great commercial value to the plaintiffs. The confidentiality order agreed to by the parties and issued by Joyal J. on November 8, 1993 permits the disclosure of documents marked confidential not only to the solicitors of record and in-house solicitors and trade-mark agents of the defendant, but also to its “officers”. An affidavit filed on behalf of the plaintiffs states that certain of the deleted information is “highly sensitive and confidential to Labatt” and, the beer business being very competitive, disclosure of information in the deleted portions “relating to the other beer concepts”, particularly to any officer of Molson, would be highly prejudicial to the plaintiffs.

Conclusions

Counsel were unable to produce any jurisprudence from this or any other Court dealing precisely with this situation.

I have no doubt that the obligation under Rule 448 is to disclose in the affidavit of documents only such documents as are “relevant to any matter in issue”, to use the words of paragraph 448(2)(a) of the Rules. It may well be that the plaintiffs were not obliged to list all of these documents in their entirety, as they did, without specifying any exceptions or deletions of material pertaining to irrelevant matters. But the fact remains that the plaintiffs did list these documents without qualification in their affidavits of documents. The question then arises: if a party in his affidavit of documents once describes the whole of a document without exception as being relevant, is he automatically bound to produce the whole of that document to an opposing party on request pursuant to Rule 452(3)? In my view he is unless he can persuade the Court, when an application for enforcement is made by the opposite party, to exercise its discretion in his favour in the interest of justice.

Rule 453(2) [as am. idem] provides as follows:

Rule 453….

(2) Where a party fails to comply with Rules 448 to 452, the Court may make such order as it considers just, including an order in the nature of the order described in Rule 461.

While that Rule clearly would permit me to order literal compliance with the requirements of Rule 452(3), I am also empowered to make such order as I consider “just”. In the present case I think I should make an order which best carries out the spirit of the Rules pertaining to discovery of documents, namely to ensure that only relevant documents need be produced. There is no jurisprudence directly on point concerning enforcement of the right to have documents produced once they have been listed in an affidavit of documents. I note, however, that in some of the jurisprudence under Rule 407(2) which requires that “[a] copy of every document referred to in a pleading shall be served on each party”, there is some indication that this may be enforced only with respect to the relevant portions of documents. Even though that Rule does not limit the documents required to be produced to those relevant to the claim and requires that if a document is referred to in a pleading it must be produced, there seems to be some authority at least for limiting the required production to the relevant portions of such documents.[1] More directly on point, in the field of examination for discovery, it has been held on various occasions that parties need produce, in response to requests at examination for discovery, only the relevant portions of documents sought.[2]

Therefore although the plaintiffs seemingly admitted in their affidavit of documents that all of these documents in their entirety were relevant and therefore prima facie had a duty to produce those documents pursuant to Rule 452(3), this was an admission from which they could resile. Just as admissions on discovery are deemed to be informal admissions and can be later qualified or negatived by other evidence of the same party, so it appears to me an affidavit of documents can be corrected. Rule 451 [as am. idem] so provides, as long as the correction is made “without delay”. In the present case the defendant moved with such speed that the plaintiffs have not had an opportunity to seek to correct their affidavit. The documents were produced by the plaintiff on November 30. The reaction of counsel for the defendant, upon realizing that certain documents as produced were not complete, was immediately to file this notice of motion two days later on December 2. That notice set the matter down for hearing on December 6 or less than one week after the production of documents. The plaintiffs replied with an affidavit which does not deal with all of the documents in question but does assert the irrelevancy of deleted portions of certain documents. The plaintiffs by letter of December 3 in fact inquired if what the defendant wanted was a revised Schedule I to their affidavits and counsel for the defendant confirmed on the same day that they did not request such an amendment. Instead they pressed ahead with the notice of motion for an order requiring production of all documents as listed in the affidavit.

It appears to me that in these circumstances it would not be just to insist that the plaintiffs be bound by Schedule I in its entirety. Instead they should be given time to file a revised affidavit describing as precisely as possible the portions of the documents listed in Schedule I that they do not consider to be relevant. It further appears to me that the appropriate procedure is for the defendant, if it so wishes, to question the representatives of the plaintiffs on examination for discovery with respect to the deletions and if it should appear that omitted materials are relevant then the defendant should demand their production as part of the examination for discovery. If production is refused then the matter can be dealt with as any other matter involving refusal to answer on discovery. I cannot of course preclude the defendant from bringing a motion prior to examination for discovery for an order pursuant to Rule 453(2) alleging, if it believes such to be the case, that the plaintiffs have failed to produce some relevant portion of some document. But it appears to me that such a procedure will not allow the defendant to question representatives of the plaintiffs as to the nature of the materials in question. If instead the defendant seeks to bring the matter directly before the Court on an application under Rule 452(4) [as am. idem] or Rule 453(2) the more likely procedure would involve an in camera hearing with only counsel for the plaintiffs present.

The action will be stayed until the plaintiffs have filed a revised affidavit of documents, except that the examination for discovery of the defendant should be allowed to proceed unless the parties agree otherwise.

Certain documents which have been produced by the plaintiffs to the defendant were handed to the Court at hearing. It emerged that document number 4, marked confidential, actually contains material which the plaintiffs had intended to delete. I am directing that that document be returned under seal to counsel for the plaintiffs without becoming part of the record, on condition that within one week of this order the plaintiffs provide counsel for the defendant with a copy of this document expurgated as they intended. Counsel appearing for the defendant on the motion is directed to return any copy of the passages intended to be expurgated and to ensure that they receive no further dissemination in her office or that of the defendant.

I will direct the plaintiffs to pay the costs of this motion although they have largely succeeded. The plaintiffs are responsible for their own difficulties in this matter, their officers having sworn affidavits that all of the documents listed in Schedule I of each affidavit were relevant to these proceedings. These affidavits were sworn after the confidentiality order, consented to by the plaintiffs, had been issued permitting disclosure of confidential documents to the officers of Molson. The deponents on behalf of the plaintiffs should have been fully aware of the possible consequences of such action. I think I may take judicial notice from the litigation in this Court that neither the plaintiffs nor the defendant are strangers to litigation. The present case was commenced on the initiative of the plaintiffs and they must be taken to have accepted the risks to confidentiality which go with such litigation. A party receiving an affidavit of documents is prima facie entitled to rely on it as representing the position of the party of the deponent as to the relevance of documents. While I consider it in the interest of justice to allow the plaintiffs to resile from their original positions in this respect they should at least be responsible for the costs of this motion which the plaintiffs had a legitimate right to bring.

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