Proceeding With The Proportionality Principle In Mind

A recent decision of the Newfoundland and Labrador Court of Appeal has affirmed that the doctrine of proportionality is alive and well in Canadian courts and further confirms that its application is broad.

In the case of Szeto v. Dwyer 2010 NLCA 36 (CanLII), the Court of Appeal was asked to consider an interlocutory decision of a trial judge ordering answers by the plaintiffs (appellants) to certain interrogatories delivered by the defendant (respondent) in a personal injury claim. Due in part to its analysis of proportionality, the Court ultimately declined to order answers to the interrogatories.

Accepting that “the interpretation and application of a particular rule of court must be undertaken in the context of the rules as a whole and in accord with their underlying spirit and purpose,” [para 52] the court first undertook a significant review of the concepts underlying the doctrine of proportionality. The court confirmed that for rules involving discretion, in this case the rules regarding pre-trial discovery and disclosure, this includes an “application of an underlying principle of proportionality which means taking account of the appropriateness of the procedure, its cost and impact on the litigation, and its timeliness, given the nature and complexity of the litigation.” [para 53]

Although the Newfoundland and Labrador rules of court do not expressly include the doctrine of proportionality (in contrast with most of the other jurisdictions in Canada), the court confirmed that this principle is nevertheless derivable from the underlying purpose and structure of the rules and the approach to their application in the case law interpreting them. It held that the following general principles and concepts are relevant:

1.  The fundamental purpose of the rules of court is to ensure an expeditious and cost effective determination of the merits of each case that is fair to all sides;

2.  The rules cannot be interpreted selectively and in isolation but must be read in conjunction with the rules as a whole;

3.  The rules involving discovery and disclosure by their nature are inherently flexible in their operation and application. They are not intended to have invariable application in every case regardless of circumstance or to dictate a specific result in a particular case;

4.  The decisions made on procedural matters involving the exercise of discretion require a balancing of the interests of each party against the interests of the others with a view to achieving a result that is fair to all sides. 

5.  Individual rules respecting disclosure and discovery have built within them the idea that their invocation may not always be appropriate in particular circumstances. The principle of proportionality underlies the interpretation and application of these rules. The court must always consider and take account of proportionality, in the sense of the appropriateness of the procedure, its cost and impact on the litigation and its timeliness, in the context of the nature and complexity of the litigation. [para 55]

The court concluded that the principle of proportionality applies not only to the parties, but to the court exercising a discretion under the rules. In its decision, the court emphasized that the principle of proportionality has general application to rules involving discretion. It went on to caution that “a party invoking a rule, taking a position or making an application that is ultimately determined to be not in accordance with the proportionality principle should anticipate that there may be adverse costs consequences”.  [para 54]

This case then stands for the proposition that parties and their counsel must proceed with the doctrine of proportionality in mind. More significantly, it assists counsel with understanding how this doctrine may be applied by courts in the context of pre-trial discovery and disclosure.

Wortzman Nickle In the News: Endorsing Good Records Management

Following the IQPC conference in Toronto in late June, Susan Nickle was interviewed by Julius Melnitzer for an article published in the Legal Post section of the National Post on July 7, 2010.

Titled “Records Management Key to Navigating Lawsuits”, the article explores the corporate risks of not having a well-managed records management program. This is consistent with Wortzman Nickle’s position that an enforced, defensible records retention policy is the foundation for a streamlined, cost effective, and efficient e-discovery process.

However, it is not just litigation risks that are mitigated by such policies. Corporations who face competition complaints, regulatory investigations or audits also benefit enormously from good records management. Further, there are numerous and compelling business efficacy reasons to implement good policies, including significant increases in employee productivity and reductions in data storage costs.

In 2010, Wortzman Nickle has seen a significant increase in corporate interest regarding the drafting and implementation of records management policies and protocols. A successful records management regime requires a healthy marriage between legal and IT. We speak the languages of both domains. Please contact our firm for details regarding the essential aspects of good records management.

Uncooperative Litigants Beware – Discovery Plans Are Not Optional

Litigants who are still operating under the assumption that meet and confer sessions/discovery plans are merely optional should take note. Recent case law under the new Ontario Rule 29.1.03 confirms that courts are willing and able to mandate discovery plans.

In TELUS Communications Company v. Sharp, 2010 ONSC 2878 (CanLII), Master Donald E. Short considered the scope of Rule 29.1.03, requiring that parties to an action agree to a discovery plan. The defendant in the case had failed to serve an Affidavit of Documents or to communicate with the plaintiff regarding his availability for discoveries.

Noting that the language of the applicable sub-sections is mandatory (”the parties to the action shall agree to a discovery plan”), Master Short turned to the issue of what occurs when the parties fail to make the directed agreement. He noted that while the new Rules address some of the consequences of a failure to agree on a Discovery Plan, including the ability of the court to refuse to grant any relief or costs, they do not provide specific guidance with respect to the imposition of a plan.

Expressly citing sub-Rules 1.04(1) and (2) which address the General Principle and Proportionality provisions of the Rules, and noting that where specific matters are not provided for in the rules, determination by analogy shall be utilized, Master Short concluded he had the authority to impose a Discovery Plan upon an unwilling litigant.

It is gratifying to see the courts embracing the principles of cooperation and proportionality in the discovery context. Stay tuned as the Ontario courts consider and rule upon other cases under the 2010 amendments to the Ontario Rules of Civil Procedure.

Pending Conference: eDiscovery Canada

Corporate Counsels’ Guide:  Developing a Strategic Approach to Containing the Costs of eDiscovery

Well-positioned on the heels of the G20 Summit in downtown Toronto comes Legal IQ’s (a division of IQPC) conference to assist corporate counsel in curtailing the rising costs of discovery. From June 28th to 30th, e-discovery experts (and those wanting to be in the know) from across North America will meet at the Sheraton Toronto Centre to address this very timely issue. 

What is interesting about this conference is its very balanced speaker mix of in-house and external counsel from private and public organizations, judges, and e-discovery vendors, from across both Canada and the United States. Primarily conducted in workshop and panel format, this conference emphasizes a very practical approach to minimizing the costs of e-discovery.  

Topics will include:

• Overcoming eDiscovery and informational challenges
• Conquering new sources of eDiscovery: Facebook and other social media
• Aligning the interests of in-house counsel, outside counsel and IT teams
• Building cutting-edge programs with a winning team that will reduce costs
• Solving eDiscovery problems in M&A and departing employees
• Using eDiscovery in criminal, fraud, tax and white collar crime cases
• Implementing the Rules of Civil Procedure to contain costs for corporations and governments

As a member of the Advisory Board for this conference, our Susan Nickle is co-facilitating a workshop on “Early Case Assessment Strategies and the Pitfalls of Disjointed Collection”.  

We’ll keep you posted on key (perhaps contentious?) issues arising at this interesting conference

Sometimes, You Have to Retreat to Advance

A Night Out for Wortzman Nickle’s Dream Team

On Tuesday night, Wortzman Nickle gathered its Review Team at Campbell House in downtown Toronto. The meeting’s agenda included both educational and social components, as well as a surprise special guest speaker. The ironic combination of e-discovery and technology in an historical, almost pioneer setting was not lost on anyone! 

The educational component included Wortzman and Nickle’s “E-Discovery A to Z” presentation, with able assistance from Caskey. While our Review Team generally focuses on the review aspect of the e-discovery process, they are also involved on different matters with the preservation, identification and collection stages.  Others also assist us with Records Management Policies.  This was an opportunity to ensure that the entire Team was up to speed on the e-discovery stages and cutting edge technology. 

The educational component was a two-way street, and it included Wortzman and Nickle obtaining information from our team. Well-versed in and experienced with numerous review platforms and e-discovery software, we solicited and received our review lawyers’ candid opinions about what technology is the best of the best.  

Our special guest, Jonathan Redgrave, is a well-known e-discovery guru from the Washington D.C. area and a good friend to our firm. Presently practicing with Nixon Peabody, he has previously appeared in our blog as a guest contributor. Jonathan joined us on Tuesday night to provide our team with the emerging e-discovery trends from south of the border. He is an engaging speaker and as usual, charmed the crowd.

The social aspect of the evening afforded an opportunity for our various review lawyers to get to know each other, and the Wortzman Nickle lawyers, legal analysts and staff better, outside the context of document review projects.  We have a very interesting and accomplished group of lawyers who work with our firm. They include a published writer, a film-maker and a former Olympian (a silver medallist no less!) to name a few. Many of our Review Team lawyers have been with us since we opened our firm in October 2007 – a few others worked with Susan Wortzman for years prior to that. With their sound legal and technical judgment, dedication to individual files, and e-discovery experience, our team really is the Dream Team for e-discovery.

Litigation Readiness – Nickle Live from LegalTech 2010

Interesting. I just attended a workshop titled “Litigation Readiness: The Impact of the Records Management Program”.  According to the panel, following a market research survey, 80% of companies surveyed reported having a records management policy. I found this statistic extremely high and query whether these reported policies are updated, followed and audited regularly. I have my doubts about that.

However, only 60% of those policies contained a litigation readiness component, and only 20% of those utilized litigation readiness software.  Further only 38% of those companies had a litigation response team in place to handle all of the e-discovery phases.

Also interesting – in the panel’s view (and these were employees of a service provider) the effectiveness of a litigation readiness program is based 90% on the policies and the team put in place, and only 10% on the software. In their words, technology is merely an “enabler” in the quest for defensible litigation readiness.

More later.

Our latest discovery

Wortzman Nickle is pleased to announce Rachael Chadwick is joining us as a Senior E-Discovery Analyst and Project Manager.  Rachael comes to us after years of experience as a Law Clerk whose practice focused on e-discovery. 

Rachael arrived just in time.  January 2010 has started off with a bang!  2010 is the year for lawyers, in-house counsel and organizations to embrace e-discovery.  Undoubtedly the new Rules of Civil Procedure that came into force in Ontario effective January 01, 2010 have had some impact on this.  We have been busy attending Meet and Confer sessions, meeting with organizations that are anxious to have Records Management Policies in place in the calendar year and meeting with other organizations who want to ensure that they have litigation readiness plans in place.  Top that off with several on going e-discovery review projects and we are off to an exciting start this year.  The addition of Rachael to our team adds to our office strength and the breadth of our e-discovery experience. 

Wortzman Nickle are off to LegalTech this week..stay tuned for updates!

Caskey on Proportionality and the New Ontario Discovery Rules

Amendments to the Ontario Rules of Civil Procedure came into effect on January 1st, 2010. Since January 1, 2010 Wortzman Nickle has been busy attending Meet and Confer sessions with our clients and advising them on discovery plans. 

Most importantly, Ontario has now formally adopted the principle of “Proportionality” and if all goes as planned, the culture of litigation in Ontario will be changing as well. 

The new Ontario Rules adopt the Sedona Canada Principles and require the parties to agree upon a “Discovery Plan” (Rule 29.1.03) which includes the scope of discovery, timing for delivery of each party’s affidavit of documents, information with respect to the costs and manner for production, names of the persons who will be produced  and any other information that will facilitate an expeditious, cost–effective discovery and ensure that the process is “proportionate” to the importance and complexity of the action. 

Rule 1.04(1.1) will give judges the mandate to “make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved”. The new Rules further entrench “Proportionality” into the discovery process by providing the court with guidelines to consider when deciding whether a party must answer a question or produce a document (Rules 29.2.03): 

The Supreme Court of Canada recently considered the principle of proportionality in Marcotte v. Longueil (City), 2009 SCC 43 (CanLII). Although the decision deals with a class action case in Quebec, the majority of the Court affirmed that the principle of proportionality confers a real power on the courts, and is not just limited to a principle of interpretation. The Supreme Court further held that proportionality is a valuable source of the courts’ power to intervene in case management to ensure that the litigation is consistent with the principles of good faith and balance between litigants.  

The courts have always had the discretion to either expand or restrict discovery and production. (See the recent decision of Justice Cullity in Pearson v. Inco Limited, 2009 CanLII 37928 (On S.C.).) The new Ontario Rules, however, charge the courts with a more active role. 

Lawyers beware – the days of the “document dump” are over. Similarly, the days of making unreasonable production requests are over. The new Ontario Rules require counsel to co-operate and work together to come up with a Discovery Plan.  If they are unable to do so, the courts will intervene and apply the principle of proportionality in order to ensure that actions are not extended for years unnecessarily thereby increasing costs astronomically.  

If you require assistance with your Discovery Plan, contact Wortzman Nickle.

Judge Scheindlin amends her original order on January 15, 2010

 To read the amendment please Click Here