Date: 20010913
Docket: T-4-00
Neutral Citation: 2001 FCT 1016
BETWEEN:
CORPORATION OF THE MUNICIPALITY OF CHATHAM-KENT
Applicant
- and -
HER MAJESTY THE QUEEN IN RIGHT OF CANADA, as represented by
THE MINISTER OF INDIAN AFFAIRS and NORTHERN DEVELOPMENT,
THE DEPARTMENT OF INDIAN AFFAIRS and NORTHERN DEVELOPMENT
and THE CALDWELL FIRST NATION
Respondents
A. INTRODUCTION
[1] The Corporation of the Municipality of Chatham-Kent ("Chatham-Kent") appeals the June 22, 2001 decision of Prothonotary Roger Lafrenière, (the "Prothonotary") who dismissed its request for an order requiring the federal Crown to produce all its legal opinions relating to the land claim submitted by Caldwell First Nation to the Government of Canada ("Canada") relating to Pointe Pelee and Pelee Island in southwest Ontario. The demand for production of the legal opinions came during cross-examination of two of Canada's deponents in the judicial review application initiated by Chatham-Kent seeking to set aside a settlement between Canada and Caldwell First Nation related to that claim.
B. BACKGROUND
[2] Caldwell First Nation submitted a claim in December of 1987 to Canada which was accepted by Canada under its Specific Land Claims Policy which is an alternative dispute resolution process designed to facilitate negotiated settlements rather than having recourse to litigation. Caldwell had in 1973 filed a previous claim which Canada had rejected.
[3] Caldwell First Nation alleged that its ancestors were the original inhabitants, occupants and owners of Point Pelee and Pelee Island; that it never surrendered Point Pelee and that a multi-year lease entered into for Pelee Island was invalid.
[4] To qualify for negotiations under Canada's Specific Land Claims Policy, it must be determined by Canada that it has a lawful obligation to the First Nation.
[5] Under the Specific Land Claims Policy, a lawful obligation may arise in any of the following circumstances:
• non-fulfilment of a treaty or other agreement between First Nations and the Crown
• breach of an obligation under the Indian Act or other statute pertaining to First Nations including obligations arising out of Canada's administration of Indian assets
• failure to provide compensation for reserve lands taken
• an illegal disposition of Indian land
[6] Historical research was conducted on the Caldwell's First Nation claim and, as noted, before a claim is accepted by Canada for negotiations, the question of whether Canada has a lawful obligation to the First Nation must be addressed.
[7] Paragraph twenty-two of Alison Mortimer's affidavit on behalf of the Crown on this point under the heading "Acceptance or Rejection for Purposes of Negotiation" reads:
22. The Department of Indian Affairs and Northern Development sends the claim submission and historical report to the Department of Justice for legal advice on whether the Crown in right of Canada has a lawful obligation, for purposes of negotiation, concerning the claim. The Department of Justice undertakes a detailed legal analysis from which a preliminary position is developed that identifies the nature and extent of the government's lawful obligations, the strength of the claim, and the applicable compensation principles. Officials of the Specific Claims Branch of the Department of Indian Affairs and Northern Development then meet with the claimant to discuss the government's preliminary position. The legal opinions obtained by the department are not disclosed, but the negotiating position as to whether a lawful obligation is owed to the First Nation is disclosed as well as the facts and evidence relied on in the legal advice from the Department of Justice. If the preliminary negotiating position of the Government of Canada on behalf of the Crown in right of Canada is to reject the claim, the claimant the First Nation may still submit further evidence or legal argument in support of its claim. [emphasis mine]
[8] In August 1995, the Department of Justice ("Justice Canada") provided to the Department of Indian Affairs and Northern Development ("DIAND") a preliminary legal opinion on the claim. That legal opinion, a sealed copy of which was provided to the Court, is headed "Protected Solicitor-Client Privilege". DIAND decided that Caldwell First Nation's claim should be appropriately considered under the Specific Land Claims Policy rather than under its Comprehensive Land Claims Policy.
[9] Chief Larry Johnson of Caldwell First Nation was informed of this fact in a without prejudice May 27, 1996 letter from the Assistant Deputy Minister of DIAND, John Sinclair, who wrote:
. . . Canada accepts that the band has established an outstanding lawful obligation on the part of Canada within the meaning of the Specific Claims Policy, to provide compensation in place of lands set apart and goods provided at the time of the 1790 Treaty.
. . .
The acceptance of the claim for negotiation is not to be interpreted as an admission of liability by Canada and, in the event that no settlement is reached and litigation ensues, the government reserves the right to plead all defences available to it. These include limitation periods, latches and the admissibility of evidence. [emphasis mine]
[10] A supplementary legal opinion was provided by Justice Canada to DIAND on July 9, 1998 in order to take into account recent Supreme Court of Canada decisions in the Aboriginal law area.
[11] Negotiations between Canada and Caldwell First Nation were successful. In October 1998, an Agreement in Principle was reached. In essence, Canada agreed to provide the Caldwell First Nation cash compensation of $23,400,000, the bulk of which is to be used to buy land for the purpose of being set aside to create a reserve.
[12] News of the Agreement in Principle became public and was confirmed in a press release in December of 1998. Prior to that, Caldwell First Nation applied to Chatham-Kent to have 68.8 acres which it had purchased on its own initiative and owned in fee simple, declared a reserve.
[13] Following the Agreement in Principle, a series of consultations, meetings and communications took place during which extensive disclosure was made that Canada had a lawful obligation to the Caldwell First Nation and why: public meetings were held at which certain information was released by the Member of Parliament for the area; DIAND's Minister met with Chatham-Kent; further historical documents were provided on March 12, 1999, a package of material entitled "Caldwell Technical Briefing" were released at a press conference and explanations were provided in letters to the Editor of Regional and local newspapers.
[14] Chatham-Kent retained legal counsel who was provided with additional documentation for review in June of 1999.
[15] On January 5, 2000, Chatham-Kent instituted legal proceedings in this Court under sections 18 and 18.1 of the Federal Court Act. It named as respondents the Crown, DIAND and Caldwell First Nation. In its application, Chatham-Kent seeks:
(a) a Declaration that in granting the claim of the Respondent, The Caldwell First Nation, . . . [Canadian officials], acted beyond their jurisdiction, failed to observe the procedures required by law in making their decision and/or based their decision on erroneous findings of fact or law made without regard to the material before them;
(b) a Declaration that the decision on December 23, 1999, to grant the claim of The Caldwell First Nation and execute a Settlement and Trust Agreement is a nullity;
(c) an Order of certiorari setting aside the decision and the Settlement Agreement and the Trust Agreement;
(d) an order of mandamus compelling . . . [the Canadian Government], to obtain from the Department of Justice an opinion on whether or not a lawful obligation to The Caldwell First Nation exists with respect to the McKee Treaty of 1790.
C. THE PROTHONOTARY'S DECISION
[16] The material parts of the Prothonotary's reasons are:
I conclude from reading the affidavits, and in particular paragraphs 22, 23, 34, 35 and 36 of the affidavit of Ms. Mortimer, that the three part test for establishing privilege has been met and that solicitor-privilege attaches to the legal opinions in question. The communication was clearly between counsel acting in a professional capacity and the Crown, prepared for the purpose of giving legal advice and intended to be confidential. In fact, confidentiality has been consistently maintained.
Moreover, I am not satisfied, based on the evidence before me, that there has been any waiver of the privilege by the Respondents. I am in full agreement with the reasoning of Justice Dubé in Begetikong Anishnabe v. Canada (1997), 138 F.T.R. 109 at p. 113 which involved strikingly similar facts and arguments:
On the whole, I agree with counsel for the Minister that the latter has never waived his privilege, expressly or impliedly. The mere fact that he has referred in his letter to the legal advice on which he based his opinion does not constitute waiver. In his letter, the Minister wrote that he has obtained a legal opinion from the Department of Justice and that, as a result of that opinion, he finds there is no basis in law for accepting the Band's claim. He did this pursuant to his obligations under the Acceptance of Claims provisions reproduced above.
D. THE STANDARD OF REVIEW
[17] The Federal Court of Appeal's decision in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 establishes the standard of review in this appeal where Justice MacGuigan wrote at page 463:
... discretionary orders of prothonotaries ought not to be disturbed on appeal to a judge unless:
(a) they are clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of the facts, or
(b) they raise questions vital to the issue of the case.
Where such discretionary orders are clearly wrong in that the prothonotary has fallen into error of law (a concept in which I include a discretion based upon a wrong principle or upon a misapprehension of the facts), or where they raise questions vital to the final issue of the case, a judge ought to exercise his own discretion de novo.
[18] Justice MacGuigan noted his quotation was taken from Lord Wright in Evans v. Bartlam, [1937] A.C. 473 (H.L.) and concluded what the Law Lord meant when he used the expression "vital to the final issue of the case" meant "vital to the result of the case" rather than "vital to the ultimate issue on the merits of the case".
E. ANALYSIS
[19] Counsel for Chatham-Kent argued Prothonotary Lafrenière erred in not ordering Canada to produce the legal opinions because: (1) Canada's repeated publicly stated lawful obligation towards Caldwell First Nation as justification for the Agreement in Principle shows that Canada had no intention to assert and never did assert solicitor-client privilege before Chatham-Kent's judicial review application was launched; or (2) alternatively, the legal opinions were disclosed by Canada or were put in issue by the Crown resulting in waiver or at the very least, fairness compels its disclosure relying on Re League for Human Rights of B'Nai Brith Canada and Commission of Inquiry on War Criminels, 28 D.L.R. (4th) 264.
[20] Counsel for Chatham-Kent said that I should exercise my discretion de novo because the issue of the production of legal opinions was vital to the judicial review application and indeed was at its foundation.
[21] It will be evident from the balance of these reasons that it makes no difference which standard of review I adopt because the result in the application of either is the same, that is, this appeal should be dismissed. Specifically, if I exercise my discretion de novo, I dismiss the appeal on the grounds which Prothonotary Lafrenière did.
[22] Prothonotary Lafrenière relied very heavily on Justice Dubé's decision in Begetikong Anishnabe v. Canada (Minister of Indian Affairs and Northern Development) (1997), 138 F.T.R. 109, sustained by the Federal Court of Appeal at (1998) 234 N.R. 24.
[23] In my view, Prothonotary Lafrenière was correct in relying on Begetikong, supra, because the legal issues there were much the same as those before him and this Court as were the factual circumstances.
[24] In Begetikong, supra, Justice Dubé dealt with two issues, namely, whether the legal opinion prepared by the Department of Justice as to the acceptability of a claim made under the Comprehensive Land Claims Policy was not privileged on the grounds that it was not intended to be confidential.
[25] At paragraph 5 of his reasons, Justice Dubé said that it was well established that three criteria must be met to establish a privilege. He wrote:
First, the communication must be between a qualified and practising solicitor, acting in a professional capacity, and his client; second, the communication must be clearly for the purpose of seeking or giving legal advice; and, third, the communication must have been intended to be confidential.
[26] He rejected the appellant's contention that no solicitor-client privilege had been created in writing as follows at paragraph 6:
[6] The Band claims that the Minister has not met the third criterion: there is no affidavit evidence that the Minister intended to keep the document confidential. In fact, the Minister did not file an affidavit to that effect, but that is not essential. The document is stamped "Protected/Solicitor-Client" and the Minister's position throughout these proceedings has been to protect the confidentiality of the document. It was filed in court in a sealed envelope to preserve its confidentiality pursuant to a specific order of the court dated July 25, 1997. There is no evidence that the Minister at any time intended to disclose that confidential document.
[27] The circumstances before me are identical to those before Mr. Justice Dubé with the additional element that I have affidavit evidence to the effect that it is a departmental policy not to disclose such opinions (see, inter alia, paragraph 22 of Alison Mortimer's affidavit).
[28] Counsel for Chatham-Kent did not challenge the first and second elements of the three-part test for privilege had not been met. In any event, I find they have been met.
[29] On the issue of waiver, the Band, in Begetikong, supra, had argued that the Minister expressly waived the privilege when he sent a letter to the Band voluntarily disclosing the substance of the solicitor/client communication, thus, bringing into issue the legal advice that he had obtained. In Begetikong, supra, the Band also argued there was a waiver by implication since the Minister may not be allowed, after disclosing that much in his letter, to withhold the remainder of the legal opinion on the principle that where a litigant relies on legal advice as an element of its claim or defence, the privilege which would otherwise attach to that advice is lost.
[30] Justice Dubé rejected that argument for the following reasons:
[12] In the instant case, I have read the legal opinion received by the Minister and I cannot come to the conclusion that the Minister has withheld confidential information which he considered to be damaging, or that he selected merely one of several recommendations. The opinion in question provides a legal review of the comprehensive claims submitted by the Band, a summary of the Band's claim, the Band's arguments, a legal analysism and the conclusion that there is no basis in law for accepting the Band's claim.
[13] On the whole, I agree with counsel for the Minister that the latter has never waived his privilege, expressly or impliedly. The mere fact that he has referred in his letter to the legal advice on which he based his opinion does not constitute waiver. In his letter, the Minister wrote that he has obtained a legal opinion from the Department of Justice and that, as a result of that opinion, he finds that there is no basis in law for accepting the Band's claim.
[31] As did Justice Dubé, in Begetikong, supra, I have reviewed the sealed legal opinions in this case and come to the same conclusion as he did in Begetikong, supra, of no waiver by Canada, expressed or implied.
[32] The 1995 legal opinion was a preliminary assessment of the evidence gathered by Canada from a wide variety of historical sources particularly surrounding the making of the 1790 McKee Treaty, an identification of the applicable legal principles, a weighing of the facts against those legal principles, a balancing of the strengths and weaknesses of the claim and a recommendation for the negotiation stance including what should be obtained from Caldwell First Nation as a result of the successful negotiation.
[33] In sum, the first legal opinion is a delicately crafted and balanced document whose purpose is to advise the Crown on whether it should enter into settlement negotiations with Caldwell First Nation, an evaluation of the strengths and weaknesses of the case on both sides and a signalling of what should be obtained during the negotiations in order to arrive at a settlement.
[34] As noted, counsel for Chatham-Kent pointed to several disclosures which he characterized as being a disclosure of the first legal opinion.
[35] I cannot agree with counsel for Chatham-Kent. At most, what was publicly disclosed was the conclusion that, in the opinion of Justice Canada, Canada had a lawful obligation to Caldwell First Nation, for purposes of negotiation, how that obligation arose and that, in the circumstances, it was appropriate to negotiate a settlement.
[36] In this context, Canada always intended to keep confidential its negotiation strategy which is at the heart of the 1995 legal opinion, a strategy which was not publicly disclosed.
[37] The July 9, 1998 legal opinion is much shorter and assesses the guidance received from the Supreme Court of Canada on a number of issues, particularly evidentiary matters.
[38] The July 1998 legal opinion then goes on to assess the evidence. Canada never disclosed the results of that detailed assessment.
[39] Finally, I do not think, as counsel for Chatham-Kent suggests, Canada put into issue the legal opinions and thereby waived them. As mentioned, what Canada disclosed is that it had received advice from Justice Canada that Canada had a lawful obligation to Caldwell First Nation for negotiating purposes. Moreover, the context of Re League for Human Rights, supra, is totally different. The context of the matter before me does not compel fairness to override the privilege.
F. DISPOSITION
[40] For all of these reasons, the appeal from Prothonotary Lafrenière's June 22, 2001, decision is dismissed with costs in any event of the cause.
"François Lemieux"
J U D G E
OTTAWA, ONTARIO
SEPTEMBER 13, 2001