Supreme Court of Canada Issues Important Judgment on Mediation, Settlements and Confidentiality

A few weeks ago, the Supreme Court of Canada released its decision in Union Carbide Canada Inc. v Bombardier Inc. I normally don't spend a lot of time on cases other than family law cases, but this decision has important implications for mediation and collaborative settlement processes that need to be talked about.

Settlement Discussions and Confidentiality Agreements

Negotiations toward settlement happen fairly frequently in family law matters, in informal circumstances such as:

• the parties or their lawyers talking on the phone or writing letters to each other and 
• in-person meetings between the parties and their lawyers, called "four-way meetings,"

and in more formal settings where the parties sign a participation agreement like:

• mediation and
• collaborative settlement processes.

Most of the time, it is understood — and often expressly stated — that the content of the discussions is "off the record" and can't be used if the parties return to court. The point of this is to allow people to propose compromises to their position without being stuck with those compromises at trial. Here's an example:

Sally hires a lawyer and sues Amar for $100,000 as her share of the family property. Amar hires a lawyer, whose opinion is that Sally is entitled to a share of the family property, but that a fair amount would be $50,000. 

Sally and Amar could go to trial over the $50,000 difference, or they could try to negotiate a settlement. Most rational people try to negotiate a settlement, which is what Sally and Amar do. However, if settlement discussions fail, $50,000 might just be enough to fight over in court. 

Sally is convinced that the court will make an award of at least $90,000, but if she spends $30,000 on lawyer's fees and expenses for the trial, she's only going to net $60,000...  a mere $10,000 improvement over what Amar has proposed. (Even if she gets the full $100,000, which is unlikely since people usually handle lawsuits strategically and ask for more than they think they're likely to get, she'll still only gain $20,000 over Amar's offer after she's paid the cost of the trial.) However, if she can settle and avoid trial, she'll get to keep all the money she was going to have to spend on her lawyer.  

Sally, Amar and their lawyers agree to use a mediator to discuss settlement. Their lawyers confirm that all of the settlement discussions will be confidential and they sign a mediation agreement which contains a term to the same effect. Confidentiality is important, because Sally needs to be able to say "I'll settle for $80,000" in the discussions, but still claim $100,000 if she and Amar have to go to a trial, and she certainly doesn't want Amar telling the court that she was prepared to settle for $80,000. Likewise, Amar needs to be able to say "I'll settle for $70,000" but still argue that $50,000 is fair at trial.

With an agreement or understanding of confidentiality in place, each party is able to bargain toward settlement without worrying that the other side will use their settlement proposals or the information disclosed during mediation against them. In the example of Sally and Amar, their starting positions are $100,000 and $50,000, but Sally knows that really her claim is probably worth $90,000. Considering that the cost of trial is going to be $30,000, this means that her real range of settlement options is between $60,000 (the likely award minus trial costs) to $90,000 (the likely award), and so she has a lot of room to move if trial can be avoided — in fact, if Amar offers her $70,000, that might be a bit of a win! Without that confidentiality agreement, Sally and Amar won't be able to budge from their starting positions. As a result, confidentiality agreements can be terribly important. 

However, even without a specific agreement, there's still the common law principle of "settlement privilege." This principle is the idea behind letters marked "without prejudice," and operates to protect communications between parties as they try to settle their dispute from being shown to the court. ("Common law," in this context, means legal principles that are developed by the courts rather than being written down in a statute or regulation made by government.) I've written about the meaning of "without prejudice" in a previous post, "What's 'Without Prejudice' and What's Not."

Proving the Terms of Settlement

What the Union Carbide cases raises is this tricky question... what do you do if you reach a settlement during negotiations that one party later tries to back out of? Can you tell the court about a settlement was reached despite a confidentiality agreement and despite the principle of settlement privilege?

It is probably surprising to no one that problems like this happen all the time. In fact, family law lawyers have a name for it: buyer's remorse.

I have had cases where the other lawyer and I have reached a settlement through an exchange of correspondence, and the other lawyer has tried to back out of the deal and argue that a settlement was not reached. In those cases, I've proved the terms of our settlement through the letters we sent back and forth, and had the court make an order wrapping up the case on the terms of our deal.

I have also had cases where the other lawyer and I have reached a settlement at an examination for discovery which the other lawyer has tried to escape. In those cases, I've proved the terms of our settlement through affidavit evidence and, better yet, the transcript of the settlement if the court reporter was asked to record the settlement.

Interestingly, I never had opposing counsel raise the issue of settlement privilege. This is probably because of an exception to the principle — there's always an exception to every legal principle, and often one or more exceptions to the exception — which says that privilege will not apply to discussions and correspondence leading to settlement when it's necessary to prove the existence or terms of the settlement.

In formal processes like mediation and collaborative work, however, there is always a written agreement that everyone signs which, among other things, says that the content of the discussions will remain private and confidential, and cannot be used in court, regardless of settlement privilege. This is what happened in Union Carbide, and the issue the Supreme Court of Canada had to decide was whether the confidentiality agreement could prevent the settlement discussions from being raised in court. 

Union Carbide v Bombardier 

In fairness, though, the circumstances in this case were bit more complicated. The parties had reached a settlement through mediation, which one party said, a little while later, was a settlement of all of the court cases between them; the other party replied that the settlement was a settlement of just one of their court cases. When the first party applied to court to get an order on the terms of the settlement, the other party objected on the basis that some of the facts on which the first party was relying arose during the mediation process. There are, of course, other important facts at play that I won't get into.

This is how the court described the case (important bits in bold, as usual):

"[27] ... there are two questions to answer in this appeal. The first is whether a confidentiality clause in a private mediation contract can override the exception to the common law settlement privilege that enables parties to produce evidence of confidential communications in order to prove the existence or the scope of a settlement. The second question, which arises only if the answer to the first is yes, is whether the confidentiality clause at issue in the case at bar displaces that exception. If it does, the information referred to in the impugned paragraphs cannot be disclosed. If it does not, that information may be disclosed if it meets the criteria of the exception."

The court first looked at the issue of settlement privilege, which it defined this way (case references omitted):

"[31] Settlement privilege is a common law rule of evidence that protects communications exchanged by parties as they try to settle a dispute. Sometimes called the 'without prejudice' rule, it enables parties to participate in settlement negotiations without fear that information they disclose will be used against them in litigation. This promotes honest and frank discussions between the parties, which can make it easier to reach a settlement ...

"[32] Encouraging settlements has been recognized as a priority in our overcrowded justice system, and settlement privilege has been adopted for that purpose. ...

"[34] Settlement privilege applies even in the absence of statutory provisions or contract clauses with respect to confidentiality, and parties do not have to use the words 'without prejudice' to invoke the privilege: 'What matters instead is the intent of the parties to settle the action ... Any negotiations undertaken with this purpose are inadmissible'. Furthermore, the privilege applies even after a settlement is reached. The 'content of successful negotiations' is therefore protected ..."

Next, the court looked at the exception to the principle of settlement privilege. After quoting from Sopinka's The Law of Evidence in Canada,

"If the negotiations are successful and result in a consensual agreement, then the communications may be tendered in proof of the settlement where the existence or interpretation of the agreement is itself in issue. Such communications form the offer and acceptance of a binding contract, and thus may be given in evidence to establish the existence of a settlement agreement."

the court summarized the principle thusly:

"[35] ... A communication that has led to a settlement will cease to be privileged if disclosing it is necessary in order to prove the existence or the scope of the settlement. Once the parties have agreed on a settlement, the general interest of promoting settlements requires that they be able to prove the terms of their agreement. Far from outweighing the policy in favour of promoting settlements, the reason for the disclosure — to prove the terms of a settlement — tends to further it. The rule makes sense because it serves the same purpose as the privilege itself: to promote settlements."

Having established that the concept of settlement privilege, which also applies to discussions made in the course of mediation, and its exception are bookends framing the overarching policy goal of promoting the settlement of legal disputes, the court then addressed whether the mediation agreement in the case operated to abridge the exception.

Here, by the way, is what the mediation agreement said about confidentiality:

2. Anything which transpires in the Mediation will be confidential. In this regard, and without limitation:

(a) Nothing which transpires in the Mediation will be alleged, referred to or sought to be put into evidence in any proceeding; 

(b) No statement made or document produced in the Mediation will become subject to discovery, compellable as evidence or admissible into evidence in any proceeding, as a result of having been made or produced in the Mediation; however, nothing will prohibit a party from using, in judicial or other proceedings, a document which has been divulged in the course of the Mediation and which it would otherwise be entitled to produce; 

(c) The recollections, documents and work product of the Mediator will be confidential and not subject to disclosure or compellable as evidence in any proceeding.

The court noted that people who engage in mediation seek confidentiality for more reasons that just protecting their position at trial. People may wish to maintain the privacy of their personal lives and business arrangements; protect information, and even the terms of settlement, from use and misuse by third parties; or keep information from discovery by government. As a result, there are additional interests involved in mediation, and, I infer, in other formal means of private settlement negotiation, that are worthy of protection:

"[45] The common law settlement privilege and confidentiality in the mediation context are often conflated. ... But ... confidentiality clauses in mediation agreements can also have different purposes. In most cases involving such clauses, the status of the common law settlement privilege will not arise, because the two protections generally serve the same purpose, namely to foster negotiations by encouraging parties to be honest and forthright in reaching a settlement without fear that the information they disclose will be used against them at a later date. However, ... settlement privilege and a confidentiality clause are not the same, and they may in some circumstances conflict. One is a rule of evidence, while the other is a binding agreement; they do not afford the same protection, nor are the consequences for breaching them necessarily the same."

But can you contract out of the exception to the settlement privilege principle by including a confidentiality clause in a mediation agreement, "thereby preventing parties from producing evidence of communications made in the mediation process in order to prove the terms of a settlement," even though such a result might "frustrate the broader purpose of promoting settlements in that it might prevent parties from enforcing the terms of settlements they have negotiated?"

The answer, in a nutshell, is sometimes.

"[51] ... It is open to contracting parties to create their own rules with respect to confidentiality that entirely displace the common law settlement privilege. This furthers both freedom of contract and the likelihood of settlement, two important public purposes. However, the mere fact of signing a mediation agreement that contains a confidentiality clause does not automatically displace the privilege and the exceptions to it. As I mentioned above, these protections do not have the same scope. For instance, settlement privilege applies to all communications that lead up to a settlement, even after a mediation session has concluded. It cannot be argued that parties who agree to confidentiality in respect of a mediation session thereby deprive themselves of the application of settlement privilege after the conclusion of the mediation session. The protection afforded by the privilege does not evaporate the moment the parties contract for confidentiality with respect to the mediation process, unless that is the contract’s intended effect."

However, if you intend your mediation agreement to suspend the exception to the settlement privilege principle, you need to be pretty blunt about it:

"[54] Where an agreement could have the effect of preventing the application of a recognized exception to settlement privilege, its terms must be clear. It cannot be presumed that parties who have contracted for greater confidentiality in order to foster frank communications and thereby promote a settlement also intended to displace an exception to settlement privilege that serves the same purpose of promoting a settlement. Parties are free to do this, but they must do so clearly. To avoid a dispute over the terms of a settlement, they may also choose to stipulate that, to be valid, any settlement agreed to in the mediation must be immediately put into writing. ... Such a stipulation would underscore the binding nature of any agreement reached in the course of the mediation process. ... 

"[67] I find that it is open to parties, in agreeing to confidentiality for a mediation process, to go so far as to limit their ability to prove the terms of any settlement. When any such limit is placed on the usual rule in this regard, however, it must be clear, on applying the principles of contractual interpretation of the relevant jurisdiction, that that is what the parties intended. ..."

Summary

Here's what the decision in this case boils down to for those involved in family law disputes.

· Settlement privilege normally protects discussions aimed toward settlement from disclosure to the court. 

· You can, however, talk about those discussions in court if it becomes necessary to prove the existence of the settlement you reached or the exact terms of your settlement. 

· Although this exception to the principle of settlement privilege is a good idea, you can contract out of the exception though a mediation agreement, so that the settlement discussions can never be disclosed, even to prove that an agreement was reached. 

· To effectively contract out of the exception, you must intend to do so and the contact needs to say that this is your intention. 

· Without having this express intention and including a statement to that effect in your mediation agreement, a confidentiality clause will not prevent you from talking about settlement discussions if necessary to prove the existence of the settlement or its terms.

Two things come from this.

Firstly, if you really intend that your settlement discussions can never be brought to the court's attention, you can do this through an agreement but you've got to be crystal clear that this is really what you mean to do; a boilerplate participation agreement generally won't do. Frankly, the exception to the settlement privilege principle serves a really important purpose, and I am having trouble imagining when you'd want to preclude it. Remember that the exception only lets you talk about your settlement discussions if necessary to prove the settlement you reached.

Second, this business about the effect of confidentiality clauses and the exception to the settlement privilege principle would apply to all formal means of dispute resolution that use participation agreements, including collaborative settlement processes as well as mediation.

My thanks to my friend and colleague Zara Suleman for bringing this interesting case to my attention.

Provincial Court Releases Important Decision on Relocation, Interim Guardianship, Needs of the Child Assessments

Judge Dhillon of the Provincial Court has recently published her decision in T.C. v. S.C., an important and scholarly decision which, among other things, she addresses:

• the relocation provisions of the new Family Law Act;
• the circumstances when it is appropriate to make an interim guardianship appointment in the context of a relocation application; and,
• the preferred content of needs of the child assessments, prepared pursuant to s. 211 of the Family Law Act.

To summarize the facts important to this discussion, the parties began to live together in 2006 and their child was born in 2007; a few months thereafter, the parties separated. The mother prepared a separation agreement which the parties signed two or three weeks later without legal advice, and which gave the mother sole guardianship of the child (and, I assume, sole custody) and gave unspecified access to the father. 

The father began to fall into arrears of child support in 2009 following his unemployment, and the mother started a court proceeding to enforce their agreement. The father replied with a claim for joint custody and joint guardianship and a defined schedule of access. The issues of access and child support were dealt with at family case conference in 2011. 

In the meantime, the mother became involved in a new relationship with a resident of Washington State. In November 2011, she let the father know that she intended to move to Seattle and in December 2011 she married. In 2012, the mother applied to vary the father's access to accommodate her plans to move to Washington with the child; the father objected and revived his claim for joint custody and joint guardianship. The matter was finally heard, by Judge Dhillon, in mid-2013, well after the coming-into-force of the Family Law Act on 18 March 2013, and this is where things get interesting.

Interim Guardianship

The initial threshold issue concerned the status of the father; see my comments on this point in my recent post "Supreme Court Issues Important Decision on Relocation." As you will recall, the parties' separation agreement gave the mother sole guardianship of the child, and under s. 68 of the Family Law Act, only a guardian may oppose a relocation application.

The court first recited the transition provisions of s. 251(1) of the act, for the principle that someone who has access but neither custody nor guardianship under a pre-Family Law Act agreement is not the guardian of a child under the new legislation. The court then observed that under s. 39(1), parents who lived together are presumed to be guardians of their child, but under s. 39(2), parents may make a separation agreement revoking a parent's standing as a guardian. The court also noted that agreements such as these are enforceable by the court under s. 44(3) of the act.

This would normally have been the end of the matter: if the father was not a guardian, he lacked the standing to object to the mother's wish to relocate with the child. However, said the court, "the substance of his parenting particularly in the last two years since the [family case conference order] has been regular and meaningful." The court then considered the effect of s. 39(3) of the act, which allows a parent who never lived with the child to apply for guardianship if he or she regularly cares for the child, and whether this provision would allow someone who had revoked guardianship under s. 39(2) to resume his or her status as a guardian: 

"[52] ... Section 39(3) of the Family Law Act permits a non-guardian parent who has never lived with the child to establish his or her status as a guardian by showing on a balance of probabilities that he or she 'regularly cares for the child'. Given the opening words 'a parent who has never resided with his or her child...' of s. 39, this section seems to preclude a guardianship application by a parent (such as S.C.) who in fact lived with the child until parental separation after which he gave up his guardianship status by agreement or under a court order. The result is that a parent who has never lived with a child but regularly cares for him or her may be found to be a guardian under s. 39(3) but a parent who once lived with the child until parental separation but gave up guardianship status under the former Family Relations Act or under a separation agreement can not avail himself of the 'regular care provider' pathway to guardianship under s. 39(3)."

In other words, once a parent who would normally be a guardian under s. 39(1) has given up that status, he or she cannot get it back by "regularly caring" for the child under s. 39(3). This is an important point; parents must be cautious in agreeing to relinquish standing as the guardian of a child.

Such a result does come across as rather Draconian, particularly in light of the court's observations of the father's role in the child's life, and the court concluded that to let such a result stand would be inequitable in the circumstances of the case before her and its effect on the father's standing to object to the move:

"[55] ... [O]n the evidence adduced by both sides in this case, the father has played a significant role in the regular care of the child and it is my view that it would be unjust for the father not to be treated as a guardian under the Act in determining the merits of the relocation application."

The court then, on the strength of s. 216 of the act which says that the court may make an interim order whenever an application is made for an order, made an interim order appointing the father as a guardian of the child.

This point is particularly important. Under s. 51(1) of the act, any person, including a parent in the father's position, may apply to be appointed as the guardian of a child, However, s. 51(2) says that a person making such an application "must provide evidence to the court, in accordance with the Supreme Court Family Rules or the Provincial Court Family Rules, respecting the best interests of the child." The required evidence is set out in SCFR 15-2.1 and PCFR 18.1 and consists of a lengthy affidavit, Form F101 in the Supreme Court and Form 34 in the Provincial Court, that requires the production of records, including child protection and criminal records checks, and certain information. 

Since completing this affidavit is a cumbersome exercise, both sets of rules allow the court to make an interim order appointing someone as a guardian, subject to the subsequent production of the required affidavit. Such was the course taken by Judge Dhillon (important bits in bold):

"[57] Accordingly, for the purposes of determining the issues in the relocation application before the court, I grant an interim order under s. 216 of the Act appointing the father a guardian of the child under s. 51(1) of the Family Law Act and under Rule 18.1(2) of the PCFR on certain terms and conditions. I do so because I find that such an order is in the best interests of the child and also in the interests of the administration of justice to permit a parent who has had a significant role in the life of a child to have relocation application considered on the basis of the parent having the status of a guardian of the child. 

"[58] To deny standing to the father to argue for his parental rights is to fail to consider a just and reasonable approach in this family law dispute. 

"[59] The terms of the interim guardianship order are that the father shall file and serve the requisite guardianship affidavit with the required attachments as mandated under Rule 18.1(1) and (4) of the Provincial Court Family Rules within 60 days of the date of these reasons. The interim order of guardianship may be finalized as a final order of guardianship by way of a desk order within the time limits under the PCFR without further hearing if the supporting materials so allow and the mother does not file an objection to the order sought within 30 days of being served with the affidavit in support of the order."

This is a terribly important conclusion and means, in effect, that even though a person is not a guardian as a result of s. 39, if that person has nevertheless had a significant role in the child's like, that person may be given interim standing as a guardian in order that the person may object to a proposed relocation, even without the required affidavit.

The Relocation Analysis

Having given the father the necessary standing to object to the mother's relocation application, the court concluded that the father did not have "substantially equal parenting time" with the child and turned to the analysis required by s. 69(3) and (4). Here is Judge Dhillon's tidy summary:

"[64] Under s. 69(4) the burden is on the mother as the relocating guardian to prove on a balance of probabilities all of the following requirements:

1. The proposed relocation is made in good faith (s. 69(4)(a)(i)), having regard to the test for good faith under s.69(4)(6) including

a) the reasons for the proposed relocation; 

b) the proposed relocation is likely to enhance the general quality of life of the child or the mother as the relocating guardian including

i. increasing emotional well being; or 

ii. financial opportunities; or 

iii. educational opportunities;

c) notice was given under s. 66; and 

d) there are no restrictions on relocation under a written agreement or an order.

2. The relocating guardian has proposed reasonable arrangements to preserve the child’s relationship with the child’s other guardians and persons with contact (s. 69(4)(a)(ii)).

"[65] Accordingly, if the relocating parent establishes the two elements of 'good faith' and 'preservation of the child’s relationship' with other guardians or contact persons under s. 69(4)(a)(i) and (ii), and addresses prima facie the factors under s. 37(2) of the Act, the proposed relocation must be presumed to be in the child’s best interests. To overcome this presumption, the burden shifts to the parent opposing the move to show that the relocation is not in the child’s best interests under s. 37: see (s. 69(4)(b) and M.K.A. v. A.F.W., 2013 BCSC 1415 at paras. 17 and 18."

The court characterized the first part of the test, the demonstration of good faith, as the burden on the moving parent of "showing that the move is not for improper purposes," citing the Court of Appeal's 2000 decision in Nunweiler v. Nunweiler, and that the move "is likely to enhance the general quality of life for the child or [the moving parent]." After reviewing the evidence, Her Honour held that:

"[76] I am satisfied that the reason for the proposed relocation is to unite a young married couple who have considered their various options and have determined that they can make a better life as a family in [Washington] instead of [British Columbia]. It is easier for T.C. to start her career in accounting in the U.S.A. than for C.B. to give up his portfolio of business clients and retrain and start a new ... career in Canada. I accept that the cost of living is lower as far as housing is concerned. I find there are no improper motivations in the mother’s desire to relocate and there is objective evidence as to a valid marriage, and employment and economic opportunities to support the mother’s subjective belief in the benefits arising from the move to [Washington]."

Turning to the question of whether the move would enhance the quality of life for the child or the mother, the court considered a number of factors, including:

• the mother's emotional health;
• the ability of the mother, child and her new husband to live as a nuclear family;
• the loss of the mother's support from her extended family;
• the standard of education in BC and Washington; including the availability of French immersion;
• the available sports and recreational activities;
• the relative affordability of housing; and,
• the availability of medical health insurance coverage.

The court concluded that the mother had first part of the test, taking a rather holistic and long-range view of the evidence and the mother's future (again, important bits in bold):

"[83] I find that the mother’s reasons for the relocation are to start her married life with her husband in a community of their choice. As a general proposition, independence, pursuit of life goals, and self-actualization are generally positive factors in a young adult’s life and should translate well for the child’s general quality of life. 

"[84] I accept that there are reasonable grounds for the mother to believe that she and her husband can attain greater financial stability and opportunities in [Washington] and improve their general quality of life which would not be as quickly or as readily available to both of them in Canada. I accept that there are risks with unknowns, such as employment trends or future economic outlook, which would affect both countries. I do accept that once housing and employment are stabilized in [Washington], and medical insurance options are explored and settled on, in the long term the general quality of life of the child and the relocating guardian is likely to be enhanced through the relocation."

The court characterized the second part of the test, the demonstration of reasonable and workable arrangements to maintain the child's relationship with the non-moving parent, as the burden on the moving parent to:

"[86] ... show how the [non-moving parent's] relationship with the child can be preserved, not augmented or enhanced. It does not require anything other than a reasonable and workable arrangement to maintain the parent-child relationship."

Her Honour also observed that in assessing the preservation of the relationship, a certain disruption to the child's life and the child's relationship with the non-moving parent must be expected:

"[89] ... It is unrealistic to expect that parents will stay in the same community in which their parenting started for the whole of a child’s life. To expect so would be to forever bind a parent to the same neighbourhood and to the existing status quo."

The court found that the mother's plans were reasonable and workable.

The third part of the test requires the non-moving parent, to rebut the presumption that the move is in the child's best interests if the first two parts of the test have been satisfied. This took the parties in this case quite far afield in the evidence presented, which included concerns about the mother's health, a long-winded diary kept by the father and his partner and the s. 211 assessment of a family justice counsellor, as well as a factor-by-factor assessment of the child's best interests following the circumstances the court must consider set out in s. 37(2). (More on the diary and the assessment in a moment.) The court's consideration of each of the s. 37 factors follows a line of cases that have adopted this approach, including S.G. v. J.P. and L.J.R. v. S.W.R.

Taking everything into account, the court allowed the mother's application to relocate:

"[147] Having considered the facts and the law, I am not persuaded that the statutory presumption that the relocation is in the child’s best interests has been rebutted. I am therefore satisfied that the relocation of the mother with the child to [Washington] is being proposed in good faith, and that the relocation proposal takes into account [the child's] need to have his father S.C. in his life in a meaningful way. The mother has set out a reasonable and workable parenting schedule of alternating weekends between the child and his father in [British Columbia] with the mother prepared to undertake the transfer driving to a location across the border. There is no significant impediment in time or distance to the father being able to preserve and enhance his relationship with his son."

Diaries as Evidence

Another gem to be pulled from this case is the court's discussion of the diary presented by the father and his new partner. It often happens in family law matters that one or both parties will keep a running record of the various slights, incidents, arguments and frustrations that come along with parenting after separation. I would be the first to agree that a record of some nature can be helpful (a record created as close in time to the event is the most reliable memory aide), however there's a difference between noting a fact such as a missed visit with no notice, an infant returned with a sodden diaper and a fight at the McDonald's used for exchanges, and a running narrative of relative trivia laden with sour commentary and opinion. As the court in this case observed, a document like this often "reveals as much, if not more, about the authors as it does about the subjects under scrutiny."

Thankfully, the father's diary provoked the court into a short discussion on the subject. The judge quotes first from an older case from the Court of Appeal, Tobias v. Meadley:

"If I may be permitted ... to express my concern and disapproval about this relatively recent practice of parties ... to keep diaries wherein they set out in great detail each day the actual or imagined slights or misconduct they have been subjected to by the other side - presumably lest they forget such incidents prior to the trial. For some reason, the diaries never set out their own failings or misconduct! Regrettably, such diaries provide a record over which the authors can brood and, if necessary, embellish, as they engage in their introspective analysis of how they are wronged by their adversary. In my view, if one has to rely on a diary to place the alleged wrongs of the opposite parties before the Court, I would assume such allegations are in fact of little consequence and should in the main be ignored. The constant review of these self-serving diaries, however, reinforces the adversarial position adopted by each parent making the object of the litigation - an eventual resolution of the parties' problems - virtually impossible to achieve."

Next, from the more recent case of D.A.H. v. S.H., from the Supreme Court:

"In my opinion diaries can be helpful tools if a person wishes to record the events of the day or week, and their feelings about those events, both positive and negative. I accept that it can be therapeutic for a person to be recording their feelings about something for the purpose of sorting out those feelings and then putting them aside to move on, especially if these feelings are a source of frustration or anger or depression. 

"However, in my view, there is a fine line between using a diary to record feelings, both good and bad, for therapeutic reasons, and using a diary to record negative feelings as a method of dwelling on those feelings. There is nothing therapeutic about using a diary to constantly lash out at your former spouse."

You can see where this is going. This is Her Honour's conclusion on the use of such diaries.

"[115] In my view, the exercise of 'tracking' and recording the mother over a period of years and transferring suspicions to the child appears to pathologize what may fall within the normal range of acts of misconduct in a child, including his not liking certain food, or being tired, frustrated or angry or being oppositional at times. It also sets the stage for an unflattering comparison of the different parenting styles in their households. 

"[116] There is an absence of self-reflection in the diary and a failure to look on many events in a less judgmental and non-accusatory way. A day care’s failure to record or transfer the father’s name provided to it by the mother onto a 'safe list' is elevated to something far more sinister on the part of the mother. The mother’s attempts to keep all school registration options open, even after consultation with the father, is seen as intentionally subverting an agreement on schooling. When the mother adopts incentives used in the father’s household such as giving the child stickers or stars for good behaviours, or buys the child a similar toy or toothpaste that he enjoys in his father’s home, these are not seen as possible child-centered adaptations in order to provide consistency for the child between the child’s two parental households but noted in the diary as 'competing' or 'showing us up'. Parenting is difficult under the best of circumstances and this type of focus does little to advance the father’s argument about what is in the best interests of the child."

The Proper Content of Needs of the Child Assessments

Finally, the court had the opportunity to comment on s. 211 assessments as a result of the father's reliance on the recommendations made in an assessment prepared by a family justice counsellor. Needs of the child assessments, or as we used to call them "custody and access reports" or "section 15 reports," play a valuable role in family law proceedings. They give the court and the parties the neutral opinion of a third-party expert as to the optimal arrangements for the children, and are extremely helpful when the parties' evidence is contradictory... as it usually is in family law matters.

However, the preparation of these reports calls for a deft touch and some care. The assessor must consider the best interests of the children in relation to the three broad subject areas set out in s. 211(1) without traipsing into the judge's domain:

1. the needs of the child in relation to the dispute;
2. the views of the child in relation to the dispute; and,
3. the ability and willingness of a party to a the dispute to satisfy the needs of that child.

Moreover, if there is a set of principles on a particular issue developed by the case law, the assessment must take into account and apply those principles.

You can get the sense that something was amiss from the quote the court takes from the assessment before she even begins her analysis. Says the assessor:

"Although T.C. has developed a comprehensive plan to move forward with her life with C.B. and wants to relocate to the United States, the move is not in the best interests of the child. T.C. and C.B. may need to canvas the resources available to them to either live as a family unit in Canada and maintain [the child's] ties to his community, or move to the United States without him."

That's pretty much telling the judge what's in the best interests of the children, well beyond the assessor's task of assessing and recommending, and is really the judge's job to determine.

Although the court offers an excellent analysis of the "in the round" approach to mobility cases developed by our Court of Appeal, and how the assessor failed to apply those principles, what I found most valuable was the court's commentary on the appropriate content of such assessments and the appropriate response of the court when the assessment falls short:

"[142] It is preferable for the author of a s. 211 report to note the parenting roles, significant relationships, and other factors relevant to the best interests of the child in his or her present location, and what may be available or proposed for the new location, and to set out a list of recommendations for parenting in either location and with either parent. In my view, it is not appropriate to decide the ultimate question of whether permission to relocate should be granted and to suggest the recommended orders of parenting for the court, including a transfer of custody, on the conclusions drawn by the author of the report. 

"[143] I find that although the background information collected by [the assessor] is well presented and very helpful, I can not place great weight on the inferences she drew from that information or her recommendations concerning the changes to the parenting orders to be made in this case. 

"[144] I have carried out an independent analysis having regard to the evidence at trial and have come to a different conclusion than recommended by [the assessor]. I have considered the submissions of the parties on where and in whose care the best interests of the child lie, following the tests under s. 69(3), s. 69(4)(a) and (b), and s. 37(2) of the FLA."

This judgement is well-written and provides a highly accessible overview of the areas of the law it covers. This judgment, and that of Mr. Justice Betton in L.J.R. v. S.W.R., provide the most definitive discussions of the relocation provisions of the Family Law Act thus far and should be read together.

The Revenge of Facebook, Part I

I've often thought of writing about the modern mischief Facebook seems to egg on, but it's always seemed too easy a target. The notion of being "unfriended" just isn't as funny as it used to be. And then along comes Nesbitt v. Neufeld, a November 2010 decision of the Supreme Court of British Columbia, and I am reminded that there are still lessons to be learned.

Dr. Nesbitt and Ms. Neufeld had been engaged it what the judge described as "protracted family court litigation" and resulted in Ms. Neufeld having primary care of the child, with Dr. Nesbitt having supervised access. I'm sure the litigation rankled. In any event the recently-published decision of Mr. Justice Crawford concerns not the family law litigation but an action in which Ms. Neufeld sought damages for defamation and breach of privacy from Dr. Nesbitt.

Ms. Neufeld's complaints centred around a variety of publications the court found to be authored by Dr. Nesbitt, including the "Wicked Wendy Neufeld" website (some related material can still be found on blogspot) featuring material from the family law litigation and some of her private communications, and a Facebook page titled "Wendy Neufeld Support Group" containing hurtful and sarcastic comments. To quote the judge, "that Dr. Nesbitt would dress his vitriol in such shabby clothing shows again a complete lack of social awareness."

Anyhow, the point here is that we as a society are well past the posting of anonymous pages on telephone poles. We live in the internet age where the scurrilous vituperations of an aggrieved individual are spewed across the globe for all to read in a second, and, just as the audience is massive, all that's required to discover it is a single ego-search. Hit PRINT and the broadcast is there to be attached to your next affidavit as Exhibit "A". Again, here's Mr. Justice Crawford:

"In this age of instantaneous broadcast to an innumerable number of people over the Internet, courts have acknowledged the aggravating factor this can have in determining whether the conduct at issue is defamatory and if so what the quantum of an award of damages should be."

The judge decided that Dr. Nesbitt had taken his custody fight with Ms. Neufeld "far outside the ordinary confines of the family court litigation," and awarded damages of $40,000 to Ms. Neufeld for breach of privacy and defamation, plus her special costs of the litigation on the basis that Dr. Nesbitt's conduct was "deserving of the Court's reproof."

I have to admit that I see things like this fairly frequently in my practice, sometimes as a result of wounded feelings, but sometimes and far worse as a result of a desire for revenge or retaliation. I won't moralize and tsk-tsk about the stupidity of such websites, blogs and Facebook pages; that ought to be obvious. Just remember that it's as easy to find and print these things as it is to post them, and I guarantee that they will find their way into an affidavit at the most inconvenient time possible.

Section 15 Reports

Important Update: The Family Law Act came into force in March 2013 and replaced the Family Relations Act, which is the subject of this post. The parts of the old act that talked about custody and access reports are now found at s. 211 of the new act, and those reports are now called "section 211 assessments" or "needs of the child assessments." I have added a brief comment on the new act to the end of this post.

"Custody and access reports," "custody assessments" and "section fifteen reports" are some of the names given to reports prepared pursuant to s. 15 of the Family Relations Act. The purpose and scope of these reports can be a bit confusing, because they seem to be treated differently in the Provincial Court and the Supreme Court, because different sorts of people prepare them, and because the scope of s. 15 is really quite broad.

The Family Relations Act

Section 15 says, in part, this:

In a proceeding under this Act, the court may, on application, including an application made without notice to any other person, direct an investigation into a family matter by a person who

(a) has had no previous connection with the parties to the proceeding or to whom each party consents, and

(b) is a family counsellor, social worker or other person approved by the court for the purpose.

(2) A person directed to carry out an investigation under subsection (1) must report the results of the investigation in the manner that the court directs.

I've highlighted the bits that are particularly important for this discussion. Essentially, s. 15 says that the court can order that a report on any family issue be prepared by any person, in whatever manner the court directs, and the court can make an order that a report be prepared on its own initiative or on the application of a party.

Most of the time, people want a s. 15 report for the assessor's recommendations about things like where the children should live most of the time and the optimum parenting schedule. It can happen, however, that people want the assessor to look at a specific problem such as a parent's drinking, mental instability, drug use or personality disorder, and comment on how the issue affects the person's capacity to parent.

Provincial Court

Most of the time, s. 15 reports prepared in matters before the Provincial Court are prepared by family justice counsellors, employees of the Provincial Court who have some training in conducting custody and access assessments, and usually have a background in social work or psychology.

These reports are free but they can take a terribly long time to complete, anywhere from six months to one year or more, depending on which courthouse the parties are at. (Surrey and Vancouver are notoriously overburdened courts.) A private psychologist or psychiatrist could probably get the assessment done faster, but they charge for their work and I'd expect that the cost would start at about $3,000 and go up to $9,000 or more, depending on the circumstances and the scope of the report.

The court can order that a s. 15 report be prepared at the first appearance, at any other appearance before trial and at a family case conference. The court generally won't order s. 15 reports at trial... by then it's too late, and ordering the report would only serve to delay the trial.

Supreme Court

Section 15 reports prepared for the Supreme Court are usually done by private psychologists and psychiatrists. Although they come at a pretty significant cost, they can usually be prepared within three to six months, depending on the issues.

The court can order that a s. 15 report be prepared at a judicial case conference or at any application brought before trial. The court will not order the preparation of a s. 15 report at or on the brink of trial.

Rules of Evidence

In the Supreme Court, s. 15 reports stand as expert evidence. "Expert evidence" is different than other kinds of evidence, because it offers an expert opinion about the best parenting arrangements for the children.

(Normally, the only kind of evidence allowed at trial is evidence of facts: "I saw Ted outside the bank," "I have a blue Chevy Pinto," "last year we went to Chilliwack for Christmas," and so on. Opinion evidence is usually about beliefs, assumptions and conjectures: "aliens live on Jupiter," "my cat is better than your cat," or "Jerry is a bad father." Expert opinion evidence is about an expert's professional conclusions about an issue or question beyond most people's knowledge: "foundations need to be drilled to a minimum depth of 6m in Prince George to avoid frost heaves," "gerbils have an average I.Q. of 15" or "the kinematic viscosity of single non-winter grade oils is measured at a temperature of 100 °C in units of mm²/s.")

As expert evidence, s. 15 reports are often subject to the special provisions of Rule 40A about who is an expert and who isn't, introducing expert reports at trial and cross-examining the person preparing the report. The Supreme Court is usually very strict about how evidence is admitted at trial and how expert reports can be used.

Things are a bit different in the Provincial Court. Rule 11(2) deals with s. 15 reports, and this rule doesn't describe persons preparing s. 15 reports as "experts." In fact, the rule seems to treat s. 15 reports entirely differently than expert evidence, which is dealt with in Rule 11(3) to (8). This is probably why family justice counsellors are able to prepare s. 15 reports for Provincial Court: they are not expected to qualify as experts and s. 15 reports are treated differently than the usual sort of expert evidence.

Views of the Child Reports

Views of the child reports are a kind of s. 15 report in which the assessor is hired to meet with the child and report back to the court or the parents on the child's views and wishes. These reports can be prepared by experts (psychologists or psychiatrists) or by non-experts (lawyers, court workers and so forth). They do not recommend or suggest a certain parenting arrangement; they are primarily geared toward finding out what the child's preferences are, even though there's no guarantee that the court will do what the child wants.

Although it probably seems that these reports don't have a great deal of utility, in fact they are very helpful when a dispute is primarily focused on parenting issues, especially in the context of settlement discussions at case conferences. Parents can be profoundly influenced toward reason by a third-party's report of their children's wishes.

When these reports are prepared by experts, the expert will sometimes administer some tests to determine the child's truthfulness and honesty, and the expert may look at difficult issues such as whether the child has been alienated from a parent or whether the child has been coached to have a certain preference.

Non-experts don't have the special skills to administer tests like that or to give opinions about whether a child has been influenced by a parent or alienated against a parent. As a consequence, while their reports are much more limited in scope and usefulness, they are generally much cheaper and faster to obtain than expert's views of the child reports: you're not paying for an expert and the assessor isn't going into an expert's level of detail.

There is another difference between expert's and non-expert's views of the child reports that has to do with the previous discussion about evidence. Expert's views of the child reports are expert evidence that can be used in both the Provincial Court and the Supreme Court. Although non-expert's views of the child reports can be used in the Provincial Court because of the special provisions of Rule 11(2), non-experts won't meet Rule 40A's test for admissibility and can't be used as evidence in the Supreme Court.

Summary

Section 15 is really quite broad. It can be used to make an application for almost any kind of report in a family law case... (I was about to say "except for medical reports and financial reports," but nothing in s. 15 really limits the sort of report the court can order to just issues about children, does it?) ...but is most often used to get an assessment of the parenting arrangements that would be best for the children.

Custody and access reports can take a lot of time to process in the Provincial Court but they are usually free. Custody and access reports can be had much more quickly in the Supreme Court, but since they're done by private psychiatrists and psychologists they can be very expensive.

Views of the child reports are an underused species of s. 15 report, and are usually must faster and cheaper to obtain than custody and access reports, particularly where the report is prepared by a non-expert. They do not have the same persuasive effect on the court that custody and access reports have, however, and non-expert views of the child reports may not be admissible in Supreme Court matters.

Update: 24 August 2014

Lots has happened since I wrote this post in 2009. Most importantly, the Family Law Act has replaced the Family Relations Act, and what used to be known as "section 15 reports" are now known as "section 211 assessments" or "needs of the child assessments."

Assessments under the new law can be a lot more focussed than they were under the old law. The new law says that the court can appoint a family justice counsellor, social worker or "another person who is approved by the court," normally psychologists or registered clinical counsellors, to do report on the needs of a child, the views of the child and/or the ability and willingness of a party to meed the needs of the child. The old law just said that the court could order "an investigation into a family matter."

Here's what s. 211 of the new law says:

(1) A court may appoint a person to assess, for the purposes of a proceeding under Part 4 [Care of and Time with Children], one or more of the following:

(a) the needs of a child in relation to a family law dispute; 

(b) the views of a child in relation to a family law dispute; 

(c) the ability and willingness of a party to a family law dispute to satisfy the needs of a child.

(2) A person appointed under subsection (1)

(a) must be a family justice counsellor, a social worker or another person approved by the court, and 

(b) unless each party consents, must not have had any previous connection with the parties.

(3) An application under this section may be made without notice to any other person. 

(4) A person who carries out an assessment under this section must

(a) prepare a report respecting the results of the assessment, 

(b) unless the court orders otherwise, give a copy of the report to each party, and 

(c) give a copy of the report to the court.

(5) The court may allocate among the parties, or require one party alone to pay, the fees relating to an assessment under this section.

The new law improves on the old by:

1. emphasizing the child-centred nature of the assessor's enquiry, 
2. allowing the court to direct the assessor to consider the children's views, and
3. focussing the enquiry on the ability of a party to meet the children's needs.

Beyond this, however, all of the old rules, standards and expectations that applied to s. 15 reports will continue to apply to s. 211 assessments.

On another subject, I had the good fortune of presenting with Dr. Phil Stahl, a highly respected forensic psychologist practicing in Arizona, about shared parenting after separation at a recent conference. Dr. Stahl spoke about the scientific standards which should be expected of people preparing needs of the child assessments at a later section, and his talk was fascinating, to say the least. Dr. Stahl has just just published a book on this issue, which I am happy to recommend. Forensic Psychology Consultation in Child Custody Litigation: A Handbook for Work Product Review, Case Preparation, and Expert Testimony is available through the American Bar Association.

What's "Without Prejudice" and What's Not

You'll often see certain lawyer's letters marked "without prejudice," and it's not always clear what "without prejudice" means, particularly for people who aren't lawyers. The question has recently come up in a file of mine, and I thought I'd take the opportunity to explain things.

"Without prejudice" protects settlement proposals

Because of the incredible expense and degree of uncertainty involved in trials, lawyers will usually make many attempts to settle a case before it heads to trial. Although settlement efforts can take many forms, the cheapest is correspondence: the exchange of letters setting out the terms on which the lawyer's client would be prepared to settle the case.

As a general but not invariable rule, settling a file means finding a compromise between the parties' positions, which means that neither party gets everything he or she is looking for. Someone who is asking for sole guardianship might compromise and agree to an order for joint guardianship as long as he or she has the children's primary residence; someone who is asking for 70% of the family assets might compromise and agree to take half the family assets as long as spousal support is paid for a certain number of years.

Now, although compromise might be necessary for settlement, the position a party takes to achieve settlement is rarely the position that the party takes at trial. At trial, the person seeking sole guardianship is still going be demanding sole guardianship, and the person after the majority of the family assets is still going to be after the majority of the family assets. But if this is the case, which it usually is, people need a way to communicate settlement proposals without affecting their positions at trial. In other words, if you're suing for twelve 1972 Ford Pintos, you need to be able to propose settlement for six 1972 Ford Pintos and three 1973 Ford Pintos without being held to that position at trial.

This is where "without prejudice" letters come in. Marking a letter "without prejudice" protects the contents of the letter from being disclosed; the letter is being sent without prejudice to the party's position at trial.

To be clear, however, just marking a letter "without prejudice" isn't going to automatically exclude the letter from use at trial. To be excluded, the letter must actually contain a settlement proposal; as our Court of Appeal said in a 1984 case called Belanger v. Gilbert, "not all letters so marked are to be held inadmissible." In another appeal case, Schetky v. Cochrane, from 1918, the court set out what was required to protect "without prejudice" letters:

"... the rule which excludes documents marked 'without prejudice' has no application unless some person is in dispute or negotiation with another, and terms are offered for the settlement of the dispute or negotiation...

"... before the privilege arises two conditions must exist, viz.: (a) a dispute or negotiation between two or more parties; and (b) in which terms are offered"

A "without prejudice" letter that meets this test cannot be put into evidence, whether at trial or as an exhibit to an affidavit.

To be even more clear, it is only the parts of "without prejudice" letters proposing settlement that are protected. A letter that talks about the number of Ford Pintos required to achieve settlement as well as setting hearing dates and the colour of the author's pants, can certainly be be put into evidence about the hearing dates and the author's pants, as long as the portion dealing with the Pintos is blocked out.

Costs

Proper "without prejudice" letters can't even be put into evidence to argue costs after trial, unless the letter contains a statement saying that the author intends to reply on the letter for the purpose of arguing costs. The English Court of Appeal summarized this point in a 1984 case called Cutts v. Head:

"...the court is able to examine and consider such correspondence, where the offeror, in the body of the correspondence in issue, expressly reserves the right to bring the letter to the notice of the judge on the issue of costs after judgment."

(Letters like these are sometimes called Calderbank letters, in reference to the 1975 case from the English Court of Appeal which authorized this narrow exception, Calderbank v. Calderbank.)

Subsequent letters not marked "without prejudice"

Interestingly, the protected status of "without prejudice" settlement proposals also applies to letters written in reply to such proposals that aren't marked "without prejudice." Halsbury's Laws of England says this at volume 15, paragraph 728 of the third edition:

Where the privilege exists, it covers not only the particular letter itself, but also all subsequent parts of the same correspondence on both sides, notwithstanding that they are not expressed to be “without prejudice," unless there is a clear break in the chain of correspondence to show that the ensuing letters are open. Moreover, where a letter offering terms, but not stated to be “without prejudice” is followed by another saying that the communications between the parties are to be “without prejudice” the former letter is protected.

"With prejudice" letters

"With prejudice" letters are different than "without prejudice" letters. Such letters not only deny any claim of protection from production to the court, they say that the letter will be produced to the court.

Of course, because marking a letter "with prejudice" doesn't make the contents of the letter any more true, or any more compelling and persuasive to judge who reads it; in fact, it's not entirely clear what is achieved by marking a letter "with prejudice" apart from expressing the author's conviction about the importance or accuracy of the contents.

To put it another way, any letter not marked "without prejudice" is "with prejudice" by definition, in the sense that there's nothing stopping the letter from being shown to the court.

Summary

1. "Without prejudice" letters allow people to discuss settlement proposals without worrying that their proposals will be held against them later.
2. The phrase "without prejudice" only protects settlement proposals. Marking your laundry list or any other communication "without prejudice" isn't going to stop the document from being used in court.
3. The parts of a "without prejudice" letter that don't talk about settlement can be used in court, as long as the parts which do talk about settlement are blocked out.
4. If a "without prejudice" letter is going to be used to argue costs down the road, the letter needs to say so or it can't be used to argue costs.