Ruling also strongly suggests that Commissioner may lack authority to order production of any document without a court order
In its long-awaited Blood Tribe decision, handed down on July 17, 2008, the Supreme Court of Canada affirmed the Federal Court of Appeal's ruling that section 12 of the Personal Information Protection and Electronic Documents Act (PIPEDA) does not permit the Privacy Commissioner to compel disclosure of materials over which solicitor-client privilege is claimed without first obtaining a decision of the Federal Court that the privilege does not apply. In rejecting the Privacy Commissioner's appeal, the Supreme Court drew a sharp distinction between her function and that of a court, going as far as to say that the Commissioner does not have the power to order the production of any documents without making application to the Federal Court with the consent of the complainant - an unexpected statement given that the issue before the Court was limited to the production of alleged solicitor-client privileged documents, although it is a logical consequence of the Court's analysis.
The key finding
The issue before the Court was the conflict between the Commissioner's statutory power under section 12 of PIPEDA to obtain personal information about a complainant for the purposes of ensuring compliance with PIPEDA and the right of the target of a complaint to keep solicitor-client communications confidential. The Commissioner argued that the statutory power permitted her to determine whether or not a claim of solicitor-client privilege is justified. Mr. Justice Binnie, for the unanimous Court, ruled that section 12 did not contain the "clear and unambiguous statutory language" that is required to overcome the solicitor-client privilege, given the high degree of protection accorded to that privilege under Canadian law. He noted that Pritchard v. Ontario (Human Rights Commission),  1 S.C.R. 809, 2004 SCC 31 prohibits any such "abrogation by inference". Any decision with respect to the justification of a claim of solicitor-client privilege lies within the purview of a court unless Parliament has explicitly stated otherwise.
History of the litigation
The matter arose in relation to a request for personal information by a dismissed employee against the employer respondent. The employer initially denied the request without reasons, prompting the PIPEDA complaint. The employee alleged that the employer had improperly collected inaccurate personal information used to discredit her before its board and had failed to disclose the personal information as required under PIPEDA. In investigating the complaint, the Commissioner issued a broadly worded request for the employee's personal employment information. She was given all relevant documents other than those over which the employer asserted solicitor-client privilege (as contemplated by Section 9(3)(a) of PIPEDA). The Commissioner ordered production of the privileged documents, as she believed she was entitled to do under section 12(1)(a) and (c) of PIPEDA. The employer's application for judicial review was dismissed by the motions judge, but the Federal Court of Appeal set aside this decision and vacated the Privacy Commissioner's order for production of solicitor-client records. The Commissioner appealed.
Other significant findings
The Supreme Court rejected the Commissioner's arguments on all grounds, and, as noted above, went further by indicating that the Commissioner does not have the power to order the production of any documents. Rather, the Commissioner must note in a report that production was refused and seek relief before a court to compel production. In his reasons at paragraph 12, Binnie J. notes that "[e]ven where the Privacy Commissioner finds that an organization has improperly refused access to personal information, she has no authority to order an organization such as the respondent to provide it." The Commissioner is required to investigate, and is entitled to examine documents that a court would not otherwise be permitted to examine. But where the target of a complaint refuses to disclose a document, the Commissioner must go to court on behalf of a complainant in order to seek production. The Supreme Court emphasized that, in seeking production, the Commissioner becomes an adversary of the target of the complaint, which further distinguishes the Commissioner from an independent court.
An argument could still be made that this additional finding in relation to non-solicitor-client privileged documents did not concern an issue before the Court and was therefore obiter, but such an argument would have to be balanced against the strong distinctions that Binnie J. drew throughout his reasons between the Privacy Commissioner and a court, which arguably make it difficult to avoid the conclusion that that the Commissioner can exercise her power to order production of documents, including those over which no solicitor-client privilege is claimed, only by seeking a Federal Court order with the consent of the complainant.
The Supreme Court also rejected the Commissioner's assertion that she has the power to compel production of solicitor-client confidences without any indication of relevance. The Commissioner's approach would give her powers that are significantly in excess of those exercisable by a court, as it would imply an obligation to disclose privileged information pursuant to an order without any evidence or argument establishing that the production of the privileged document was necessary to decide the issue. Courts require such evidence or argument before they will adjudicate a claim of privilege (Ansell Canada Inc. v. Ions World Corp. (1998), 28 C.P.C. (4th) 60 (Ont. Ct. (Gen. Div.)), at para. 20).
The Supreme Court proceeded to draw a distinction between the Privacy Act (which governs federal government institutions) and PIPEDA (which governs private entities), noting that the Privacy Act contains explicit exceptions to privileges claimed by a government institution while similar language is not present in PIPEDA.
Finally, the Court pointed out that the Commissioner cannot establish that routine access to solicitor-client confidences is "absolutely necessary" (as required by Descôteaux v. Mierzwinski,  1 S.C.R. 860). The Commissioner has adequate opportunity to have the privilege verified: either pursuant to the general right of a commission to refer questions of law, jurisdiction, practice or procedure to the Federal Court in Section 18.3(1) of the Federal Courts Act, or in an application for relief to the Federal Court under Section 15 of PIPEDA itself, with respect to any impasse noted in the Commissioner's report under Section 13 of PIPEDA and with the consent of the complainant.
The decision brings Canadian privacy law squarely in line with the traditional approach of Canadian courts to solicitor-client privilege, according to which it cannot be abrogated by a statutory inference, but must be expressly overridden.
Privacy Commissioner of Canada v. Blood Tribe Department of Health, 2008 SCC 44