Industry Relief After Federal Court of Appeal Decision

Litigation partner David Outerbridge has weighed in on a Federal Court of Appeal decision that brought a “collective sigh of relief from lawyers involved in structuring commercial transactions.”

The ruling confirmed common interest privilege (CIP) protects the sharing, between parties to a commercial transaction, of communications that are subject to solicitor-client privilege (SCP).

The ruling overturns a December 2016 Federal Court decision by Justice Peter Annis.

Speaking with Law Times on the ruling, David said after the Federal Court decision there were “fairly significant working groups in the transactional bar” and added there were “concerns about what would happen if the decision was upheld.”

In Annis’s original decision, he cited a “New York Court of Appeal decision and an academic paper by a U.S. law professor as support for his conclusions.”

“There is already Canadian law. It was not necessary to look at U.S. law,” David told Law Times.

 “The Federal Court of Appeal is saying it is not up to trial-level judges to change the law based on policy concerns.”

David continued to say the Federal Court of Appeal decision was narrow in its analysis of CIP.

“It is not clear how far it goes beyond the scope of M&A transactions,” he said.

David and his team had written a bulletin at the time of the Federal Court of Appeal decision, which you can read here.

You can learn more about Torys’ Litigation and Dispute Resolution Practice by heading to its practice page.