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Are documents prepared by a regulatory body privileged? The Court of Appeal says: it depends…

documents-prepared-by-regulatory-body-privilegedThe Court of Appeal for Ontario recently commented on the application of case-by-case privilege to documents created by the Institute of Chartered Accountants of Ontario (the Institute) through its investigative process. In particular, the decision in Philip Services Corp. v Deloitte & Touche demonstrates that such documents may be disclosed in civil proceedings in the absence of clear assurances of confidentiality.


The appellants in Philip were the representative plaintiffs in a class action alleging the respondent negligently audited financial statements for Philip, a publicly traded company. Prior to this class action, the Institute brought disciplinary proceedings against a senior partner at Deloitte in relation to Deloitte’s past audits of Philip. After the Institute made findings of professional misconduct against the partner, the appellants sought an order under rule 30.102 to compel the Institute – as a non-party to the litigation – to produce its investigative report, witness statements, interview notes, and other documentation related to the disciplinary proceedings (the Materials).

The motion judge denied the application on the basis that the requirements under rule 30.10 had not been met. Specifically, the motion judge concluded it would not be unfair for the appellants to proceed to trial without discovery of the material being sought and, in any event, that this material was subject to case-by-case privilege.3

The appeal decision

In dismissing the appeal, the Court of Appeal held that the motions judge properly applied the factors established in Ontario (Attorney General) v Stavro4 in concluding it would not be unfair for the appellant to proceed to trial without the material in question. In particular, the Court of Appeal agreed the appellants already had access to the information that Deloitte provided to the Institute’s investigators and that the appellant’s experts had the opportunity to evaluate the significance of that evidence.5 However, the Court of Appeal went on to conclude that the motion judge erred in finding the documents in question were privileged.6

Both the motion judge and Court of Appeal considered the Wigmore criteria for determining case-by-case privilege:

  • the communication must originate in a confidence that they will not be disclosed;
  • the confidentiality must be essential to the full and satisfactory maintenance of the relation between the parties;
  • the relation must be one that in the opinion of the community ought to be sedulously fostered; and
  • the injury that would inure to the relation by the disclosure of the communications must be greater than the benefit thereby gained for the correct disposal of litigation.7

The motion judge concluded that the Institute gave assurances of confidentiality for the Materials sought, that this confidentiality was essential for maintaining the relationship between the Institute and its members, that it was in the public interest to protect this relationship, and that impairing this relationship by disclosing the Materials sought would be more injurious to the public interest than the advantages realized by disclosing them to the court.8

However, the Court of Appeal took a different view. It held that in the normal course the Institute would have disclosed the Materials being sought to the partner once the charges were laid. As a result, these documents would normally be in the hands of the accused and led as evidence in the ensuing disciplinary proceedings.9 Consequently, these documents would be made public through the disciplinary process and, because Deloitte and the partner would have possessed these documents, they would have also been subject to discovery and production in the subsequent class action.10

What was unusual about this case was a tactical decision was made not to accept the disclosure of these documents; instead, Deloitte and the partner entered into a settlement agreement with the Institute that, among other things, provided that the documents in question would not be entered into evidence as part of the settlement.11

The Court of Appeal held this agreement was entered into after the documents being sought had been created and after charges had been laid against the responsible partner at Deloitte. As such, these documents could not have originated in confidence for the purposes of determining privilege under the first element of the Wigmore criteria.

The Court of Appeal further held the Institute’s governing framework does not ensure confidentiality after charges are laid and, as such, confidentiality is not essential to the relationship between the Institute and its members beyond that point.12

Further, the court held that the type of “tactical cooperation” between a regulator and its members evidenced in this case was not something that should be fostered in the interests of the community.13 Finally, the court concluded that the injury to the relationship between the Institute and its members that would be created by disclosing these documents would not be greater than the benefit gained by the courts through the correct disposal of this litigation.14


This decision provides that when assessing whether case-by-case privilege applies, courts should continue to give careful consideration to the Wigmore criteria but must also carefully scrutinize any agreement between parties that has the effect of creating an after the fact basis to assert such privilege.

The Court of Appeal made it clear that unless there is some well-established public policy for excluding relevant evidence, the judicial system is best served by allowing the trier of fact to consider such evidence. In this case, the documents were not produced, not because they were privileged, but because the appellants already had access to the information that was provided to the Institute for its investigation. As such, the appellants would not be disadvantaged by proceeding to trial in the absence of the Materials sought.

by Marc Kestenberg
Norton Rose Fulbright Canada LLP / S.E.N.C.R.L., s.r.l.
The author wishes to thank Jonathan Preece, articling student, for his help in preparing this legal update.


1 Philip Services Corp. v Deloitte & Touche, 2015 ONCA 60 [Philip].

2 Rules of Civil Procedure, RRO 1990 Reg. 194, r. 30.10.

3 Philip, supra at para 4.

4 Ontario (Attorney General) v Stavro (1995), 26 OR (3d) 39 (CA).

5 Philip, supra at para 10 and 11.

6 Philip, supra at para 6

7 The four “Wigmore criteria” for determining case-by-case privilege were recognized by the Supreme Court of Canada in Slavutych v Baker, [1974] 1 SCR 254.

8 Philip, supra at para 19.

9 Ibid at para 24.

10 Ibid at para 24

11 Ibid at para 24.

12 Ibid at para 34.

13 Ibid at para 35.

14 Ibid at para 35.

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