Franco v. Nissan Canada Inc.

2022 BCSC 1710 Franco v. Nissan Canada Inc.

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Franco v. Nissan Canada Inc., 2022 BCSC 1710 Date: 20221003 Docket: M209098 Registry: New Westminster Between:

JEFFREY FRANCO Plaintiff And NISSAN CANADA INC. (LESSOR) and ELVIN JOHN PICARDO (LESSEE) Defendants Before: Master Hughes Reasons for Judgment Counsel for Plaintiff: O. Hui Counsel for Defendants: L. McClanaghan Place and Date of Hearing: New Westminster, B.C. September 9, 2022 Place and Date of Judgment: Vancouver, B.C. October 3, 2022 [1] The plaintiff applies for production of an independent adjuster's report over which the defendants claim litigation privilege. Background [2] This action arises out of a motor vehicle accident which occurred on January 8, 2017 (the First Accident). The plaintiff was subsequently involved in another motor vehicle accident on January 20, 2017 (the Second Accident), which is the subject of a separate action (the Second Action). The plaintiff claims to have sustained injuries in both accidents. [3] When reporting the First Accident to ICBC, the plaintiff advised that he may have dashcam video of the accident, but would have to see if the images could be retrieved from the unit. On January 18, 2017, a representative of ICBC, Kimberley Omule, sent an email to the plaintiff saying that "the other motorist has been held 100% responsible" and so there was "no need to send off your dash board camera". [4] The plaintiff retained counsel shortly after the Second Accident, and his counsel wrote to ICBC on February 2, 2017, advising that he had been

retained. Plaintiff's counsel subsequently exchanged correspondence with the ICBC adjuster, Edith Reid, regarding both accidents. [5] The plaintiff was involved in three subsequent accidents, on October 16, 2018, December 18, 2018 and June 13, 2019, for which he also claims loss, injuries and damages, and which are the subject of three additional actions. [6] Notices of Civil Claim with respect to the first two accidents were filed on December 6, 2018, approximately a month prior to the expiry of the limitation period for the First Accident. Both Notices of Civil Claim were served on ICBC under cover of letters dated December 11, 2018, and personal service on the defendants was effected thereafter. [7] Counsel for the defendants contacted the plaintiff's counsel on May 13, 2019 to advise they had been retained. A Response to Civil Claim was filed in this action on January 10, 2020, denying liability. This was the first notice to the plaintiff that liability was denied for the First Accident. A Response to Civil Claim was filed in the Second Action on February 4, 2020, admitting liability for the Second Accident. [8] On April 22, 2022, defendants' counsel provided a combined list of documents with respect to all five actions involving the plaintiff. This list of documents included the report which is the subject of this application under Part 4, claiming litigation

privilege. [9] In defence of this application, the defendants rely on an affidavit from Brian Simmons, a Claims Specialist at ICBC. Mr. Simmons says that he has been the responsible Claims Specialist with respect to all five accidents since February 27, 2019, when he took over conduct of these matters from Ms. Reid. His review of the file materials indicates that on March 5, 2018, Ms. Reid instructed an Independent Adjuster to conduct an investigation regarding the nature of the plaintiff's alleged head injury. That investigator's report, the subject of this application, is dated May 16, 2018. Legal Test [10] Counsel agree that the relevant test regarding a claim of litigation privilege is set out by the Court of Appeal in the leading case of Hamalainen (Committee of) v. Sippola, (1991), 62 B.C.L.R. (2d) 254, confirmed in Raj v. Khosravi, 2015 BCCA 49 at paras. 8 and 9: [8] In determining whether litigation privilege applies to a particular document, Mr. Justice Wood, writing for the Court in Hamalainen, set out the following two-part test at para. 18: 1. Was litigation in reasonable prospect at the time it was produced, and 2. If so, what was the dominant purpose for its production? [9] Each aspect of the two-part test involves a factual determination. The onus is on the party claiming privilege to establish on a balance of probabilities that both parts of the test are met in

connection with each document that is subject to the claim (Hamalainen at para. 19). [11] The Court of Appeal in Raj v. Khosravi went on to discuss the two parts of the test in greater detail in paras. 10 through 20. Analysis [12] The threshold for determining whether litigation was a reasonable prospect is a low one. In Sauvé v. ICBC, 2010 BCSC 763, Mr. Justice Joyce succinctly summarized this part of the test as follows: [30] Obviously, the court must consider the particular circumstances of each case when applying the legal test. As was stated in Hamalainen, the first part of the test will often not be hard to meet. "Reasonable prospect" does not mean certainty. It does not require the commencement of an action. The essential question is this: would a reasonable person being aware of the circumstances conclude that the claim will not likely be resolved without litigation? [Emphasis added.] [13] In this case, the report was completed in May 2018, some 16 months after the accident and 7 months before the Notice of Civil Claim was filed. Internal ICBC records indicate that liability had been resolved in favour of the plaintiff almost immediately after the accident was reported. The parties had been corresponding, and the plaintiff provided medical and wage loss documentation. [14] The defendants submit that liability had been determined at the outset and was never reconsidered.

However, it must have been reconsidered at some point, as liability is denied in the Response to Civil Claim. [15] The defendants rely on the fact that the plaintiff had been in three previous accidents prior to the First Accident, and had made and settled claims following each of those accidents. They say that this fact increased the likelihood of litigation following the First Accident. There was no evidence as to the stage at which each of those three prior claims had been settled, and whether litigation had commenced prior to settlement. The fact that each of those claims settled, in my view, would make litigation arising from subsequent accidents less likely, not more so. [16] Litigation was a possibility, as it always is in an unresolved tort claim. However, I cannot say that at the time the report was commissioned that it was unlikely that the claim for loss would be resolved without litigation. I find that the defendant fails on the first part of the test. [17] Even if I am wrong as to whether litigation was a reasonable prospect, I do not find that litigation was the dominant purpose for which the report was produced. [18] The defendants rely on Stevanovic v. Petrovic, 2007 BCSC 1392, which discusses the various purposes for investigating an insurance claim. These purposes include determining coverage, in terms of the factual scenario and whether the insured has

breached the policy of insurance; considering interim payments; and whether to offer compensation to settle the claim. The defendant says that it is clear from Mr. Simmons' affidavit that coverage was not an issue, nor were interim payments, as Part 7 benefits were being paid. This overlooks the fact that investigation could have been for the purpose of making or responding to a settlement offer before litigation was commenced. Further, as previously mentioned, the defendants clearly changed their position on liability at some point prior to filing the Response to Civil Claim. [19] The only evidence before the court as to the reason the report was commissioned was Mr. Simmons' review of file materials from Ms. Reid indicating that she retained the Independent Adjuster "to conduct an investigation regarding the nature of the Plaintiff's alleged head injury". There is no letter of instruction or anything more than Mr. Simmons' statement to indicate the reason for commissioning the report. As in Spenst v. Reemeyer, 2013 BCSC 1394, there was no evidence before the court from Ms. Reid, who was the adjuster who had conduct of the file at the time the report was commissioned and for the first two years of the claim. There is no evidence as to whether any other investigations were conducted as to the issue of liability or the extent of damages. The plaintiff was not advised that

liability was denied until he received the Response to Civil Claim. There is no evidence to objectively establish that the report was commissioned for anything other than a basic assessment of the plaintiff's injuries. [20] Returning to Raj v. Khosravi, the court said the following regarding the dominant purpose test: [16] In applying this test, it must be recognized that any particular document may have more than one purpose. When a document is produced for dual or multiple purposes, one of them being litigation, and none of the purposes are dominant, the document should be disclosed. This principle is captured in the following excerpt from Lord Denning's opinion in Waugh, as reproduced in Hamalainen: [22] If material comes into being for a dual purpose - one to find out the cause of the accident - the other to furnish information to the solicitor - it should be disclosed, because it is not then 'wholly or mainly' for litigation. On this basis all the reports and inquiries into accidents - which are made shortly after the accident - should be disclosed on discovery and made available in evidence at the trial. [Emphasis added.] [17] A claim of privilege will succeed when a party can establish that a document produced for dual or multiple purposes, one of them being litigation, was produced for the dominant purpose of litigation. There is no absolute rule for determining whether

litigation was the dominant purpose for the document's production (Hamalainen at para. 25). A finding of dominant purpose involves an individualized inquiry as to whether, and if so when, the focus of the investigation/inquiry shifted to litigation. This is a factual determination to be made based on all of the circumstances and the context in which the document was produced. As Wood J.A. explained in Hamalainen: [24] Even in cases where litigation is in reasonable prospect from the time a claim first arises, there is bound to be a preliminary period during which the parties are attempting to discover the cause of the accident on which it is based. At some point in the information gathering process the focus of such an inquiry will shift such that its dominant purpose will become that of preparing the party for whom it was conducted for the anticipated litigation. In other words, there is a continuum which begins with the incident giving rise to the claim and during which the focus of the inquiry changes. At what point the dominant purpose becomes that of furthering the course of litigation will necessarily fall to be determined by the facts peculiar to each case. [Emphasis added.] [18] Thus, the focus of an inquiry may shift to litigation at any point along the continuum between the preliminary information-gathering stage and the final litigation stage. It may occur while

other investigations are being conducted and other documents are being produced with respect to related matters that are not for the dominant purpose of litigation. There is no legal requirement that every potential or conceivable purpose for the creation of a document must be negatived before it can be found that the document was produced for the dominant purpose of litigation. The effect of such a requirement would be the adoption of the "sole purpose test", which was expressly rejected in Blank. [21] Mr. Simmons' Affidavit says "In reviewing the file, I have informed myself and verily believe that the Independent Adjuster's Report addresses the Plaintiff's claim of bodily injury specifically related to the Plaintiff's claim of concussion and head injury. The Independent Adjuster took statements from the Defendant and witnesses of the Accident. The Report also includes the writer's opinions on whether the interviewed subjects would make good trial witnesses." [22] It is this last part of Mr. Simmons' description of the report, as to whether the interviewees would make good trial witnesses, that the Defendant relies on. The defendant says there is no other logical reason for witness assessment other than for litigation. While I agree with that submission, that does not necessarily mean that the report's dominant purpose was litigation. The adjuster was asked to assess the

plaintiff's claims for bodily injury. That could have been for the purpose of adjusting or information-gathering for the purpose of settlement, and not necessarily for litigation. Insufficient evidence was provided by the defendant to conclusively determine the purpose of the report. [23] The onus for proving that the report was created for the dominant purpose of litigation rests with the defendants. The defendants have not provided sufficient evidence to meet that burden. Result [24] Accordingly, within 30 days from the date of this order, the defendants shall produce to counsel for the plaintiff item 4.3 from Part 4 of the Combined List of Documents of the Defendants dated April 22, 2022. [25] The lawyer for the plaintiff may take copies of all or any part of the documents so produced upon payment of the cost of reproduction and service. [26] On the request of the lawyer for the plaintiff, and on receiving payment in advance of the cost of reproduction and service, the defendants will serve on the lawyer for the plaintiff copies of the documents that he is entitled to inspect if reproducible. [27] Costs are awarded to the plaintiff in any event of the cause. "Master Hughes"