Category: Probate Litigation

Reopening a Trial

Shen v Chan BCSC 2514 is an example where a plaintiff lost at trial and attempted to reargue and reopen the case before the same judge rather than appealing the decision.

The application was dismissed and the court referred to the main principles set out below.

In Mayer v. Mayer Estate, 2020 BCCA 282, our Court of Appeal stated:

I would summarize the main principles applicable to such an application in the following way:

it is generally speaking in the interests of justice to consider that a trial is complete when each side has closed their case and the judge has delivered his or her judgment;
a judge’s … discretion to reopen a trial should be exercised with restraint;
a party may not use the rule to re-argue, re-cast, or re-state his or her case, rather the rule is available to remedy what might otherwise be a substantial injustice;
it is not intended that a party should be able to lead substantial new evidence, nor does the rule generally permit the leading of new expert evidence;
the reasons that the evidence was not led or submissions not made in the first place may be relevant to the exercise of the judge’s discretion, particularly where the failure to do so in the first place was a considered or pragmatic decision; and
the discretion should only be exercised if the reception of the new evidence would probably change the result of the trial.

I would add to this list that a judge may reasonably exercise such discretion where a relatively discreet error in math or some mechanical consideration of the evidence is clearly in error.

Finally, the overarching consideration is whether it is in the interests of justice that the court reopen the case. (See also Brown v. Douglas, 2011 BCCA 521, 314 B.C.A.C. 143.)

Admissibility of Medical Records

Many types of estate litigation cases such as testamentary capacity, undue influence, committee applications and others rely on medical evidence, which is typically initially obtained from medical records that are subsequently admitted into evidence at trial provided they meet the legal requirements set out below.

Re Gibb Estate 2021 BCSC 2461 quoted Re Singh Estate 2019 BCSC 272, which reviewed the law relating to the admissibility of medical records as an exception to the rule against hearsay pursuant to the standard business records exception.

The court summarize the applicable law:

[48] While clinical records are hearsay, they are admissible under the business records exception both at common law and under s. 42 of the Evidence Act. The requirements for the admission of medical records as business records are set out in Aresv Venner 1970 SCR 608

The Supreme Court of Canada held at 626:

Hospital records, including nurses’ notes, made contemporaneously by someone having a personal knowledge of the matters then being recorded and under a duty to make the entry or record should be received in evidence as prima facie proof of the facts stated therein.

[49] Justice Burnyeat in McTavish summarized the principles from Ares at 311-12:

1. The notes taken must be made contemporaneously.

2. The notes must be made by someone having a personal knowledge of the matters being recorded.

3. The notes must be made by someone who has a duty himself or herself to record the notes or to communicate the notes to someone else to record as part of the usual and ordinary course of their business.

4.The matters which are being recorded must be of the kind that would ordinarily be recorded in the usual and ordinary course of that business.

5. A statement in the records of the fact that a certain diagnosis was made will be admissible.

6. Recorded observations, diagnosis and opinions will be admissible providing they are recorded in accordance with points 1 through 4.

7. The fact that the referring doctor relied upon another doctor’s opinion to assist in coming to his or her own diagnosis and opinion is only evidence of that fact so that the other opinion does not become evidence unless it is otherwise admissible. Accordingly, it is only evidence of the fact that the referring doctor wished or required that opinion to be received before forming his or her own opinion.

8. Statements made by parties or by experts which are recorded in the usual and ordinary course of business but which lie outside the exception to the hearsay rule are hearsay and will not be admitted into evidence unless they can be brought within Section 14 of the Evidence Act which allows for the admissibility of such statements if it can be shown that they are proof of a prior inconsistent statement.

[50] The issue of third party statements was addressed in Cambie Surgeries. Justice Steeves provides:

…any statement by the patient or any third party that is not within the observation of the doctor or person who has a duty to record such observations in the ordinary course of business is not admissible for any purpose and will be ignored by the trier of fact…
…

S. 43 WESA: Gifts to Will Witnesses or Their Spouses

Prior to the introduction of WESA on March 31, 2014 the law was clear that the court had no discretion to allow for gifts to a will witnesses or to his or her spouse. Estate of Jason M. Bird 2002 BCSC 1584.

The purpose of that rule was to prevent fraud and undue influence, but its rigid application often defeated the genuine intention of the testator.
As a result of s. 43 WESA, gifts made in such circumstances where a beneficiary or his or her spouse witnesses the will is still presumptively void, but the courts now have the discretion to declare them valid.

The factual circumstances of where s.43 will usually apply is the home made will, and not that prepared by a solicitor.

This is largely due to the effects of s. 58 WESA which empowers the court to order that a document or other record is fully effective as the will of a deceased person if the court is satisfied that the document represents the testamentary intentions of that deceased person.

After verifying the authenticity of the testamentary document, the courts will the focus in on what was the intention of the testator in exercising its discretion pursuant to s. 43 (4) WESA.

At this time there have been three cases decided by the court relating to s.43 WESA, and the court has allowed the validity of each bequest under s. 43 in each case after closely examining the facts and probable intention of the deceased.

1. Bach Estate (Re), 2017 BCSC 548

The testator was predeceased by his wife and was survived by one natural child and two stepchildren. in September 2014, the testator’s sister (the “applicant”) and her husband accompanied the testator to a notary public’s office for the purpose of creating a new will, in which he named the applicant as the sole beneficiary of his estate.
The notary public advised the testator to come back the next day to execute this new will. After that appointment, the testator had to be hospitalized the same day.

That same evening the testator signed a document in which he left his entire estate to the applicant. A physician and the applicant’s husband witnessed the document. The next day the testator passed away.

The applicant brought an application for an order that the document be declared a valid will pursuant to s. 37(1) and s. 58 WESA and that the gift under the will be declared valid pursuant to s. 43 (4) and the application was allowed.

The testator had informed his friend that he wanted to leave his estate to his sister and he had an appointment with a notary public for this purpose. Additionally, the physician who witnessed the document stated that the contents of the document were read aloud to him, that the testator agreed with the contents, and that he understood the document was intended to indicate his wishes for the estate.

Based upon all of the evidence the Court was satisfied that the document executed on September 9, 2014 amounted to a will and represented the testator’s testamentary intent. The gift was not void.

The document was handwritten and read:

SEPT. 9, 2014

I TERRENCE ARTHUR BACH

LEAVE ALL MY ASSETS

In full to my sister

Sharon Rose Thibodeau

“T. Bach”

Witness: “E. Willms”

SEPT 9/14

Witness: “R. Thibodeau”

September 9, 2014

The court’s analysis relied heavily on the s. 58 WESA case law that focused on the intention of the testator .

The court specifically relied upon Yaremkewich Estate (Re), 2015 BCSC 1124, that considered s. 58 and the concept of testamentary intent when considering curing deficiencies in a purported will, stating:

[35] In George the court confirmed that testamentary intention means much more than the expression of how a person would like his or her property to be disposed of after death. The key question is whether the document records a deliberate or fixed and final expression of intention as to the disposal of the deceased’s property on death. A deliberate or fixed and final intention is not the equivalent of an irrevocable intention, given that a will, by its nature, is revocable until the death of its maker. Rather, the intention must be fixed and final at the material time, which will vary depending on the circumstances.

The court allowed extrinsic evidence to be admitted on the question of testamentary intent under s. 43(5) and stated that the court is not limited to the evidence that the inspection of a document provides.

2. Wolk v Wolk 2021 BCSC 1881 reviewed the law of will witnesses or their spouses receiving a gift to them under and the effect of s. 43 (4) of WESA .

The deceased left the following document:
“I leave to my parents, Michael Dawson Wolk and/or Lynda Ruth Wolk should they survive me all monies and properties of my estate with the proviso that they in turn provide a portion of the estate to my daughters, Jessica Berens and [E.H.] either in trust or in a protected format such that they will in turn receive a stipend when they reach the age of twenty-five (25) should they also survive me. This includes the repayment of monies to my parents for loans and assistance given me over the years including the overseeing of my daughter [E.H.].

My parents can decide if the money goes to education payments, RRSPs’, or a similar portfolio to protect my daughters for later in life.
This is as given by me on this 9th day of September 2016.”
The beneficiaries of the “ will” witnessed the document.

Under s. 40 of WESA, the fact that a signing witness is given a gift under the will does not affect the capacity to serve as a witness:

Will Witnesses

s. 40 …

(2) A person may witness a will even though he or she may receive a gift under it, but the gift may be void under s. 43

However a gift to a signatory witness is automatically void by statute, but the court may declare such a gift valid on application under s.43(4) WESA.

Section 43 of WESA includes the following:

(1) Unless a court otherwise declares under subsection (4), a gift in a will is void if it is to

(a) a witness to the will-maker’s signature or to the spouse of that witness,
. . .
(3) If a gift is void under subsection (1), the remainder of the will is not affected.

(4) On application, the court may declare that a gift to a person referred to in subsection (1) is not void and is to take effect, if the court is satisfied that the will-maker intended to make the gift to the person even though the person or his or her spouse was a witness to the will.

(5) Extrinsic evidence is admissible for the purposes of establishing the will-maker’s intention under subsection (4).

The court followed the Re Bach estate decision finding that s. 43(4) is centrally concerned with testamentary intent.

The court was further concerned that absent a declaration of the will’s validity under s. 43(4), there would be a partial intestacy under s. 25 of WESA which would not have been the intended result of the deceased.
The Court found that the deceased wanted the witnesses to receive the bequests as a gift and allowed such under Rule 43(4) WESA.

3. Re Le Gallais Estate 2017 BCSC 1699 dealt with the charging clause in a will that provided that if the lawyer who prepared and witnessed the will should act as the executrix and attend to the legal work of the estate, then she would be entitled to a fee for the usual and proper charge for such legal work.

A legal issue arose as to whether the charging clause in favour of the lawyer was valid due to the fact that the lawyer witnessed the will.

The drafting lawyer M. Isherwood had known the deceased professionally for over 40 years.

The charging clause stated:

“If the said Constance Dora Isherwood should act as Executrix of this my will and should also attend to the legal work of my estate, she shall be entitled to the usual and proper charge for such legal work.”

The court found that the deceased was an experienced business woman who would have known that legal work was required to finalize her estate after her passing.

The court invoked S. 43 ( 4) WESA that a gift to the lawyer was intended and that under the circumstances, the charging clause was not void by reason of her having witnessed the will and would take effect.

Conclusion

The courts have focused on the intention of the deceased when determining relief under s. 43 WESA when a bequest has been made to a witness of the will, or to his or her spouse.

Prior to the introduction of WESA there were strict execution requirements under the previous Wills Act that when not followed undoubtedly resulted in outcomes that were contrary to the intention of the deceased. While well intended these execution rules were strict and the court lacked discretion to in effect do justice.

To date the cases reported under s. 43 (4) have followed the rationale of the several cases reported under as the curative provisions s. 58 WESA and focused on the fixed and final intention of the deceased when signing a purported testamentary document him. Where the court is satisfied as to its validity, it will order curative provisions under both sections of WESA.

Determining the intention of the deceased when examining a document appearing to be a will together with extrinsic evidence from witnesses can be a daunting fact driven exercise for the trier of fact, but is a fact of estate litigation as seemingly more and more people attempt to save money and do their own will.

Limitation of Actions- New Rules

The Supreme Court of Canada in Grant Thornton LLP v New Brunswick 2021 SCC 31 provided new guidelines for when a plaintiff discovers or should have discovered that a claim has arisen, thus starting the limitation clock.

The SCC upheld the trial judge who dismissed a substantial claim for an auditor’s negligence on the basis that the Province had actual or constructive knowledge of the material facts when if received the draft auditor’s report in 2011.

In June 2014 the Province commenced an action for negligence seeking damages but the court held it was filed out of time as per the Limitation of Actions Act( LAA). The draft report was sufficient to draw a plausible inference that the auditor had been negligent.

Since the province did not bring its claim until June 23, 2014, more than the limitation period for negligence of two years , its claim was therefore statute-barred.

THE LAW

The standard to be applied in determining whether a plaintiff has the requisite degree of knowledge to discover a claim under s. 5(2) of the LAA, thereby triggering the two-year limitation period in s. 5(1)(a), is whether the plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendant’s part can be drawn.

This was sufficient to draw a plausible inference that the auditor had been negligent. Since the province did not bring its claim until June 23, 2014, more than two years later, its claim is therefore statute-barred.

In order to properly set the standard, two distinct inquiries are required.

1) The first inquiry asks whether, in determining if a statutory limitation period has been triggered, the plaintiff’s state of knowledge is to be assessed in the same manner as the common law rule of discoverability. Under that rule, a cause of action arises for purposes of a limitation period when the material facts on which it is based have been discovered or ought to have been discovered by the plaintiff by the exercise of reasonable diligence.

The common law rule of discoverability does not apply to every statutory limitation period. Rather, it is an interpretive tool for construing limitations statutes and, as such, it can be ousted by clear legislative language. Assessing whether a legislature has codified, limited or ousted the common law rule is a matter of statutory interpretation. Section 5(1)(a) and (2) of the LAA does not contain any language ousting or limiting the common law rule; rather, it codifies it. This interpretation is supported by the words of s. 5, read in their entire context and in their grammatical and ordinary sense harmoniously with the LAA’s scheme and object, and the intention of the legislature.

Accordingly, as established by the rule of discoverability and the LAA, the limitation period is triggered when the plaintiff discovers or ought to have discovered, through the exercise of reasonable diligence, the material facts on which the claim is based.

2. The second inquiry relates to the particular degree of knowledge required to discover a claim.

A claim is discovered when a plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendant’s part can be drawn. This approach remains faithful to the common law rule of discoverability, which recognizes that it is unfair to deprive a plaintiff from bringing a claim before it can reasonably be expected to know the claim exists. It also accords with s. 5 of the LAA, promotes consistency and ensures that the degree of knowledge needed to discover a claim is more than mere suspicion or speculation. At the same time, it ensures the standard does not rise so high as to require certainty of liability or perfect knowledge. A plausible inference of liability is enough; it strikes the equitable balance of interests that the common law rule of discoverability seeks to achieve.

The material facts that must be actually or constructively known are generally set out in the limitation statute. In the LAA, they are listed in s. 5(2)(a) to (c).

A claim is discovered when the plaintiff has actual or constructive knowledge that: (a) the injury, loss or damage occurred; (b) the injury loss or damage was caused by or contributed to by an act or omission; and (c) the act or omission was that of the defendant. This list is cumulative. In assessing the plaintiff’s state of knowledge, both direct and circumstantial evidence can be used. A plaintiff will have constructive knowledge when the evidence shows that the plaintiff ought to have discovered the material facts by exercising reasonable diligence. Finally, the governing standard requires the plaintiff to be able to draw a plausible inference of liability on the part of the defendant from the material facts that are actually or constructively known. This means that in a negligence claim, a plaintiff does not need knowledge that the defendant owed it a duty of care or that the defendant’s act or omission breached the applicable standard of care. All that is required is actual or constructive knowledge of the material facts from which a plausible inference can be made that the defendant acted negligently.

In the instant case, the province had actual or constructive knowledge of the material facts — namely, that a loss occurred and that the loss was caused or contributed to by an act or omission of the auditor — when it received the draft report from the other firm on February 4, 2011.

Dismissal of a Court Action For Delay

Dismissal of a court action for inordinate delay ( want of prosecution) requires four criteria:

1) Has there been an inordinate delay;
2) Is the inordinate delay inexcusable;
3) Has the delay caused or is likely to cause serious prejudice to the defendant; and
4) On balance does justice require a dismissal of the action?

Rule 22-7(7) provides that the court may order that a proceeding be dismissed if it appears that there is want of prosecution in the proceeding.

The BC Court of Appeal in Wiegert v. Rogers, 2019 BCCA 334 set out the relevant considerations in respect of applications for want of prosecution as follows:

1. On an application to dismiss for want of prosecution, it must be shown that there has been inordinate delay, that the inordinate delay is inexcusable, and that the delay has caused, or is likely to cause, serious prejudice to the defendant. In addition, the final and decisive question, which encompasses the other three, is whether, on balance, justice requires a dismissal of the action: Azeri v. Esmati Seifabad, 2009 BCCA 133 at para. 9; 0690860 Manitoba Ltd. v. Country West Construction Ltd., 2009 BCCA 535 at paras. 27–28.

Inordinate delay is delay that is immoderate, uncontrolled, excessive and out of proportion to the matters in question: Azeri at para. 8; Sahyoun v. Ho, 2015 BCSC 392 at para. 17.

2. In Sun Wave Forest Products Ltd. v. Xu, 2018 BCCA 63 at para. 25, the concept is relative: some cases are naturally susceptible of fast carriage or call for more expeditious prosecution than others. Although there is no universal rule as to when time starts to run, the date of commencement of the action is typically identified as the point from which delay is measured. The delay should be analysed holistically, not in a piece-meal fashion, and the extent to which it may be excusable is highly fact-dependent: Ed Bulley Ventures Ltd. v. The Pantry Hospitality Corporation, 2014 BCCA 52 at para. 38; 0690860 at para. 29.

3. Once a defendant establishes that delay is inordinate and inexcusable, a rebuttable presumption of prejudice arises: Busse v. Chertkow, 1999 BCCA 313 at para. 18.

The concern is with the prejudice that a defendant will suffer in mounting and presenting a defence if the matter goes to trial: 0690860 at para. 27.

Relevant matters could include failing memories, unavailable witnesses and the loss or destruction of physical evidence.

4. whether, on balance, justice requires dismissal of the action — again, the determination is highly fact-dependent.

Relevant matters could include the length of and reasons for the delay, the stage of the litigation, the context in which the delay occurred and the role of counsel in causing the delay (although negligence on the part of a plaintiff’s lawyer may not always amount to an excuse): International Capital Corporation v. Robinson Twigg & Ketilson, 2010 SKCA 48 at para. 45; 0690860 at para. 29.

Redacting Relevant Documents

Redacting relevant documents is often attempted by litigants who wish to edit out irrelevant or embarrassing portions of a document disclosed or demanded in the litigation process.

The issue was discussed in Minchin v Movsessian 2021 BCS 1303 which quoted North American Trust Co. v. Mercer International Inc. (1999), 71 B.C.L.R. (3d) 72, that discouraged the practice of litigants “editing out substantial parts of a document production believed to be irrelevant”.

Rule 7-1(1)(a)(i) requires parties to list and produce:

…all documents that are or have been in their possession or control that could, if available be used by any party of record at trial to prove or disprove a material fact

Under the rules of court, a litigant cannot avoid producing a document in its entirety simply because some parts of it may not be relevant. The whole of a document is producible if a part of it relates to a matter in question.

Since North American Trust Co. was decided, Rule 7-1(1) narrowed the scope of relevance for initial lists of documents. However, Rule 7-1(1) did not authorize litigants to edit documents on the basis of relevance alone. Generally speaking, the whole of a document must still be produced if a part of it may be used to prove or disprove a material fact: Este v. Blackburn, 2016 BCCA 496 at para 19.

In Araya v. Nevsum Resources, 2019 BCSC 1912, the court rejected an attempt to redact Facebook posts for irrelevant content, holding that the plaintiffs’ approach of treating each post as a separate document for the purposes of production and redaction is clearly not efficient, will increase cost, and cause delay.

The practice of redacting relevant records by removing information that counsel believes cannot be used to prove or disprove a material fact is not consistent with the rules, and should be discouraged by the court.

Irrelevant information may be removed but counsel must follow the guidelines lad down by the court for doing so.

In North American Trust Co., the court allowed that an otherwise relevant document may be redacted where:

a) the redacted material is irrelevant; and,
b) there is a good reason why it should not be disclosed

A listing party may redact information with a note to that effect in its list of documents, and then, on an application by the requesting party for production of the complete document, seek a ruling of the court under Rule 7-1(14)(a) upholding the redaction: Este, at para 20; McCaw’s Drilling & Blasting Ltd. v. Greenfield Construction Ltd., 2019 BCSC 2244, at para. 23.

When a redaction is disputed by the receiving party, the onus is on the party seeking to limit the disclosure to adduce evidence that satisfies the court that the material is likely irrelevant and a good reason favouring redaction: Este, at para. 21.

Where a Halliday order is appropriate, a litigant may redact irrelevant or privileged information from otherwise relevant documents. The weighing of probative value and prejudicial effect is an evidentiary consideration that goes to the admissibility of documents at trial, not document production.

In exceptional cases, the court may make an order under Rule 7-1(14)(a) excusing a party from full compliance with the document disclosure rules. But privacy alone is not an exceptional circumstance relieving litigants of their obligation to list and produce all relevant documents.

Adverse Inferences- Under Utilized?

Govorcin Fisheries v Medanic Fisheries 2021 BCSC 1092 reviewed the principles relating to adverse inferences for failure to call certain witnesses or evidence without valid explanation.

It is a principle that dates back to the late 1700’s and is perhaps under utilized in estate litigation.

The matter of adverse inferences was discussed in some detail in the decision of the Court of Appeal in Rohl v. British Columbia (Superintendent of Motor Vehicles), 2018 BCCA 316, at paras. 1-4:

M.K. Fuerst in The Law of Evidence in Canada (4th ed., 2009):

In civil cases, an unfavourable inference can be drawn when, in the absence of an explanation, a party litigant does not testify, or fails to provide affidavit evidence on an application, or fails to call a witness who would have knowledge of the facts and would be assumed to be willing to assist that party. In the same vein, an adverse inference may be drawn against a party who does not call a material witness over whom he or she has exclusive control and does not explain it away. Such failure amounts to an implied admission that the evidence of the absent witness would be contrary to the parties’ case, or at least would not support it.
. . .
An adverse inference may be drawn when, without explanation, a party does not give evidence or fails to call a witness who in the circumstances would be expected to favour the party and the witness would have knowledge of the facts in dispute. In such circumstances, the failure to call the witness or give testimony is seen as akin to an admission that the evidence would have been contrary to the party’s case, or at least would not support it. [At § 13.2131.]

According to the jurisprudence, an adverse inference or missing witness instruction is not “appropriate” where:

• counsel have offered an explanation for the failure to call the witness; such as a good faith belief in the unreliability of the witness; or, that the decision was a tactical one;
• the party has no special access to the witness;
• the evidence would be “unimportant to the case, cumulative, or inferior to the evidence already available on the relevant point”;
• where there is no evidence as to why the witness was not called.

Courts have held that an instruction is “appropriate” where:

• a party advises a jury or judge that the witness will be called;
• a party has greater access to the witness than the other and the witness would corroborate the party’s case in a significant respect; or, “where the accused in his own testimony first raises the corroborative significance of the witness to his defence”. [At § 33.10.30.]

These apply with varying degrees of strictness in civil actions.

In Jolivet, Binnie J. emphasized that one must be “precise” about the exact nature of the adverse inference sought to be drawn, endorsing the suggestion made in the Lederman text that in Canada, the inference is generally that the evidence of the absent witness would not support or, more significantly, that it would be contrary to the evidence of the party involved. In the criminal law context, therefore, courts must be particularly careful to ensure that an accused’s right to remain silent is not breached by the drawing of an adverse inference and that the onus of proof is not mistakenly shifted to the accused.

A considerable number of cases now reinforce the view that there is no such thing as a “mandatory adverse inference” to be drawn where a party fails to call a witness. Rather, the question of whether to make such an inference seems to depend upon the specific circumstances, in particular whether:

• There is a legitimate explanation for the failure to call the witness;
• The witness is within the “exclusive control” of the party, and is not “equally available to both parties”; and
• The witness has material evidence to provide; and
• The witness is the only person or the best person who can provide the evidence.

Essentially, the decision to draw an adverse inference is discretionary and premised on the likelihood that the witness would have given harmful testimony to the party who failed to call him or her.

See also Davison v. Nova Scotia Government Employees Union 2005 NSCA 51 at para. 74; O’Connell (Litigation Guardian of) v. Yung 2012 BCCA 57 at para. 75, citing Rimmer (Guardian ad litem of) v. Langley (Township) 2007 BCCA 350 at para. 30; R. v. Degraw 2018 ONCA 51 at para. 35; Parris v. Laidley 2012 ONCA 755 at para. 2; Gough v. C.R. Frankenham Backhow Services Ltd. 2008 NSCA 38 at para. 48; McWilliams, supra, at § 33.10.30.

Courts Refuses Production of Computer Hard Drive

In a long running matrimonial dispute the court in Etemadi v Maali 2021 BCSC 1003 refused to order the defendant to produce her computer hard drive to her husband.

A computer hard drive is not a document, as contemplated by the provisions of Rule 9-1 Rule 1(1) of the Supreme Court Family Rules.

Rather, a hard drive is the digital equivalent of a bookshelf, a filing cabinet or a documentary repository. While the court may order the production of relevant documents stored in a hard drive, the Rules do not authorize an unrestricted search of a digital storage device.

A “document” is defined in Rule. 1(1) of the Supreme Court Family Rules as having an extended meaning ,”…and includes a photograph, film, recording of sound any record of a permanent or semi-permanent character and any information recorded or stored by means of any device”.

The court was influenced by the decision o of Desgagne v. Yuen, 2006 BCSC 955 where the court found the defendants were seeking disclosure, from the computer, of all available documentation to recording virtually every element of the plaintiff’s activities for all of her waking hours- an extremely broad ” fishing expedition”.

No specific documents from the computer had been sought and the court found that the claimant wished to leaf through the digital files on the hard drive to determine whether any relevant material has been disclosed, and that is not a mode of disclosure contemplated by the Supreme Court Family Rules.

Etemedi v Maali referred to the decision of the British Columbia Court of Appeal in Privest Properties Ltd. v. W.R. Grace & Co. – Conn (1992), 74 B.C.L.R. (2d) 353 (C.A.).

In that case, the plaintiff sought access to a document repository established by the defence (for use in U.S. litigation due to jurisdictional overlap). After reviewing the provisions of then Rule 26, Southin, JA, commented, at paras. 37-40:

“But these rules do not empower a judge to require a party to give access to his opponent to documents which are neither in his list not in an affidavit required to be made under sub-rule 4 nor referred to in one of the documents listed in sub-rule 8.

Sub-rule 10 confers no power to make the order under appeal which is really an authorization to search.

If the court had power to make this order then it would also have the power to permit a litigant access to all places in which his opponent might keep documents to see if there is anything “relating to any matter in question”.

It would require much different rules to give the court such an extraordinary invasive power in circumstances such as these. However, if the fact that the respondents at one time wrongly believed to exist – that is to say, a deliberate concealment of documents – was proven to exist, it may be that an order of the sort made here could be made for the purpose of redressing dishonesty in the litigtion.

In the case of Mossey v. Argue, 2013 BCSC 2078, Master Young, as she then was, reviewed the provisions of the Supreme Court Family Rules with respect to document disclosure, and then went on to say as follows:

The law is not that a party can demand every document that has come into a party’s possession or control because they are suspicious of wrongdoing. They have to specify what document or class of documents they are requesting and tie it to an issue in the proceedings.

As Master Baker said in Anderson v. Kauhane (February 22, 2011), Vancouver Registry — and this is quoted in Master Bouck’s decision in Przybysz (as read in):

…there is a higher duty on a party requesting documents under…Rule 7-1(11)…they must satisfy either the party being demanded or the court…with an explanation “with reasonable specificity that indicates the reason why such additional documents or classes of documents should be disclosed”…

Przybysz and Anderson are civil cases, but civil Rule 7-1(8) and Supreme Court Family Rule 9-1(8) are identical. The only difference in document disclosure in family law proceedings is that the first tier of disclosure is at least partially proscribed in the family law financial disclosure Rule 5-1, which makes disclosure of income information from personal and corporate sources mandatory and sets out some basic rules for disclosure of business interests. There will likely be other documents that fit into the first tier of disclosure.

However, gone are the days of the full underwear drawer disclosure, unless the demand is made with specificity and justification.

In this case, the initial demand letter does not set out the reason for the demand. I have combed through the letters and emails to see if that flaw has been addressed. Some of the follow-up emails and letters do allude to some specific issues that the respondent wishes to prove. The notice of application is a disappointing cut-and-paste of the original deficient demand letter. It does not specify many of the documents or classes of documents, and it does not establish a reason for many of the requests.

The rules of document disclosure were changed to avoid document disclosure demands like the one I have before me today. It is impractical to expect a party conducting business will be required to produce a photocopy of every cheque front and back, every invoice, credit and debit note, and receipts for years of business transactions. The costs of the legal proceeding will far exceed the value received by the party if the court has to condone forensic audits of the parties’ businesses because the parties are mistrustful of one another.

Mistrust is a common theme in matrimonial proceedings. The threshold for document disclosure has to be higher than that.

Security For Costs of $150,000 Ordered

The court in Global Chinese Press Inc ( Global) v Zhang et al 2021 BCSC 999 ordered Global to post security for court costs in the amount of $150,000 within 60 days.

Section 236 of the Business Corporations Act, S.B.C. 2002, c. 57 provides:

236. Court may order security for costs

If a corporation is the plaintiff in a legal proceeding brought before the court, and if it appears that the corporation will be unable to pay the costs of the defendant if the defendant is successful in the defence, the court may require security to be given by the corporation for those costs, and may stay all legal proceedings until the security is given.

In Kropp v. Swaneset Bay Golf Course Ltd. (1997), 29 B.C.L.R. (3d) 252 at para. 17 (B.C.C.A), the court set out the considerations that govern an application for security for costs:

1. The court has a complete discretion whether to order security, and will act in light of all the relevant circumstances;

2. The possibility or probability that the plaintiff company will be deterred from pursuing its claim is not without more sufficient reason for not ordering security;

3. The court must attempt to balance injustices arising from use of security as an instrument of oppression to stifle a legitimate claim on the one hand, and use of impecuniosity as a means of putting unfair pressure on a defendant on the other;

4. The court may have regard to the merits of the action, but should avoid going into detail on the merits unless success or failure appears obvious;

5. The court can order any amount of security up to the full amount claimed, as long as the amount is more than nominal;

6. Before the court refuses to order security on the ground that it would unfairly stifle a valid claim, the court must be satisfied that, in all the circumstances, it is probable that the claim would be stifled; and

7. The lateness of the application for security is a circumstance which can properly be taken into account.

[24] An order under s. 236 is discretionary, but once the applicant has shown that the plaintiff will not be able to pay costs should the claim fail, security is generally ordered unless the court is satisfied that there is no arguable defence: Fat Mel’s Restaurant Ltd. v. Canadian Northern Shield Insurance Co. (1993), 76 B.C.L.R. (2d) 231 at para. 16 (B.C.C.A). The law does not treat corporate plaintiffs with the same generosity and flexibility as natural persons opposing an application for security: Kropp at para. 11.

[25] The evidence on this application clearly indicates GCP is insolvent, has no exigible assets, and will be unable to pay costs if it is unsuccessful in this action. In failing to respond to this application, GCP has not filed any evidence to the contrary or suggested any reason why security should not be ordered.

Renewal of a Notice of Claim

Gill v Basic 20212 BCSC 875 dealt with the renewal of a Notice of Claim without notice to the defendants.

In Gill the Notice of Claim had expired 8 months prior through inadvertence and the defendant had not been served as they could not be located.

The court renewed the Notice of Claim for a further 3 months finding there was no prejudice to the defendants but there would be substantial prejudice to the plaintiffs if they could nor proceed with their claim.

Rule 3-2(1) requires the plaintiff to serve the original NOCC on the named defendant(s) within 12 months of filing. This 12-month period can be extended if the defendants have not been served with the NOCC in the requisite period of time. In such case, the plaintiff must bring an application to renew the NOCC. The NOCC can be renewed for a period of not more than 12 months at a time.

In Fast Fuel Services Ltd. v. Michelin North America (Canada) Inc., 2008 BCCA 216 [Fast Fuel] at para. 9, the Court set out the factors to consider in such applications. These are:

1) Whether the application to renew was made promptly;
2) Whether the defendant had notice of the claim before the notice of civil claim expired;
3) Whether the defendant was prejudiced;
4) Whether the failure to effect service was attributable to the defendant; and
5) Whether the plaintiff, as opposed to the plaintiff’s solicitors, was at fault.

The promptness of the application and the prejudice to the parties are measured as of the date of the discovery of the error: Fast Fuel at para. 17.

In determining whether to grant a renewal, courts should primarily be concerned with: (1) the rights of the litigants, and not with the conduct and failures of their solicitors; and (2) ensuring that the outcome would not create a substantial injustice to either the plaintiff or the defendant: Sutherland v. McLeod, 2004 BCCA 653 at paras. 28-29; see also Stuart v. Patterson, 2010 BCSC 1236 at para. 13.

The plaintiff has a high duty of disclosure, and a failure to provide full and frank disclosure may result in the setting aside of the order made: Politeknik Metal San ve Tic A.S. v. AAE Holdings Ltd., 2015 BCCA 318.