Canadian Lawyer

50 N O V E M B E R / D E C E M B E R 2 0 1 5 w w w . C A N A D I A N L a w y e r m a g . c o m It's now a legal, heavyweight brawl, pit- ting the federal attorney general and the Canada Revenue Agency against the big guns of the Chambre Des Notaires du Que- bec and the Barreau du Quebec. Piling on as intervenors in support are the Canadian Bar Association, the Advocates' Society, the Criminal Lawyers' Association, and the Federation of Law Societies. The question is whether the tax act's search-and-seizure provisions dealing with solicitor-client privilege can withstand Charter scrutiny under s. 8 search and seizure, and s. 7, right to life, liberty, and security of the person. The ITA is the latest law to face such attack, as the legal profession rightly circles the wagon around the Holy Grail of solic- itor-client privilege, considered a corner- stone to the practice of law. The Supreme Court's past rulings involving law office search warrants suggests the federal gov- ernment is destined for another defeat. That raises the question why bother wast- ing taxpayers' money? Politicians should simply amend the law and move on. In Lavallee, Rackel & Heintz v. Canada (Attorney General), the Supreme Court in 2002 was clear that "solicitor-client privilege must remain as close to absolute as possible to retain its relevance." The court shot down the DPR provision of s. 488.1 of the Criminal Code, holding there weren't enough protections in place for solicitor-client privilege under s. 8 of the Charter. Rather, the court set out a 10-step process that governments should follow when seizing documents from a lawyer. Apparently, the federal government didn't get that memo, and it continues its attack on solicitor-client privilege. Interestingly, s. 488.1 was modeled on s. 232(1) of the Income Tax Act. Another case of note is this year's Can- ada (Attorney General) v. Federation of Law Societies of Canada, the legal professions' assault on the federal government's Pro- ceeds of Crime (Money Laundering) and Terrorist Financing Act — also a victory for lawyers. The law included lawyers as financial intermediaries, making them sub- ject to financial reporting to FINTRAC and search and seizures under that law. The Supreme Court upheld the gist of the law, but only after reading out lawyers and law firms from the equation on the basis that it violated Charter s. 8. That brings us to this case. The federal government distinguishes it on the basis that Lavallee involved criminal law and income tax is administrative or regula- tory law, so a lower standard applies. In the CLA's factum, Stockwoods LLP lawyer Brian Gover writes "the Attorney General's reliance on the 'regulatory context' of the ITA to defend the DPR is misplaced," and he attacks the law for its lack of controls and protections. At the case's heart is what constitutes "the accounting record of a lawyer" — one of the exceptions carved out from privilege protection under s. 232(1) of the ITA. The government argues there's no expectation of privacy in lawyer accounting records and they are unlikely to reveal privileged information. The CBA's legal team, headed by Mahmud Jamal of Osler Hoskin & Har- court LLP, however, points out that courts have differed in defining what is a lawyer's "accounting record," noting the "case law confirms that the term is broad and mal- leable and has no settled meaning." One Alberta judge determined it could have five meanings, depending on the investigation. The Federation of Law Societies of Canada's legal team, headed by John Laskin of Torys LLP, argues the common law of solicitor-client privilege has now become a constitutionally protected right. "Since 1965, when the current statutory definition of solicitor-client privilege was enacted, the common law definition has evolved. It is no longer a simple rule of evidence; it is a substantive rule of law and a fundamental right." The FLSC argues that sending a lawyer a demand to produce information puts the lawyer in a conflict with his or her client. If a lawyer refuses the demand, "the lawyer's own right to liberty is compromised — the lawyer potentially faces imprisonment for up to 12 months." It argues that is a viola- tion of Charter s. 7. The full bench of the Supreme Court has been hesitant to date in the other cases in confirming that s. 7 engulfs solicitor- client privilege. Now is the time to stop encroachment on solicitor-client privilege and send a clear message. The Supreme Court needs to pro- nounce boldly and loudly that Charter s. 7 protects lawyers in their defence of solic- itor-client privilege. To do otherwise will merely encourage governments to continue chipping away at the privilege armour that shields the heart of the profession. Jim Middlemiss is a principal at Web- NewsManagement.com. B A C K PA G E O P I N I O N @JimMiddlemiss n interesting constitutional fight involving solicitor-client privilege continued at the Supreme Court of Canada in early November. The Attorney General of Canada v. Chambre des Notaires du Québec involves the Income Tax Act and the document production regime that requires lawyers and notaries to turn over their account- ing records or face jail time when the Canada Revenue Agency issues a warrant or demand for information. The case arose when CRA officials issued demand letters to notaries in Quebec. Some complied and others refused, citing professional secrecy, which is enshrined in Quebec's Charter of Human Rights and Freedoms. That led to a court fight over the constitutionality of certain provisions of the ITA, including the s. 232(1) definition of solicitor-client privilege, which was drafted in 1965 and carves out lawyers' accounting records from protection. The notaries won at both the superior and appeal court levels, prompting the government to appeal. By Jim Middlemiss Protecting solicitor- client privilege A

• Cover