By Gary Luftspring gluftspring@rickettsharris.com 416.364.6211 Ext. 282

By Sam Sasso ssasso@rickettsharris.com 416.364.6211 Ext. 285

Introduction

You have just been retained by a mid-sized manufacturing company which is being sued by a supplier.  Your client needed to find new counsel due to their counsel’s recent move to a firm which has a conflict.  An agreement executed by the parties set out the type of parts to be produced and the timing of payments; there is no “entire agreement” clause in the agreement.  The supplier brought an action claiming that your client had received additional parts than in the agreement and that your client had been underpaying for those additional parts; your client admits that it received additional parts from the supplier but says that those parts were covered by a separate agreement.  The separate agreement was never executed and there are numerous drafts and versions in the possession of both parties.  Also, your client has accounting ledgers showing payments relating to all parts, technical drawings of some of the parts, and volumes and volumes of emails which, despite their voluminous size, are incomplete.  The trial date is less than two months away.
Your situation raises numerous questions, all of which have to be answered considering technical and tactical factors: When is the best time to introduce the accounting ledgers?  How do they have to be proved?  Can you use communications with third parties?  What evidence can you use from a witness who can no longer testify?  How can you use a written expert report on the differences in the parts?  How will parol evidence be used in relation to the executed agreement?  And what do you do with all of those drafts and versions of the unsigned agreement?
This paper will discuss how to use (or counter) documentary evidence.  The questions raised above will be discussed considering how documentary evidence can be used technically, and when it should be used tactically.  Further, this paper will discuss how the new e-discovery rules will change the way evidence is found and used at trial.
Part 1: Tactics for introducing business records at trial
(i) What are business records?
The definition and use of business records is governed by s. 35 of the Ontario Evidence Act, R.S.O. 1990, c. E.23, which provides:
Business records
Definitions
            35.  (1)  In this section,
“business” includes every kind of business, profession, occupation, calling, operation or activity, whether carried on for profit or otherwise; (“enterprise”)
“record” includes any information that is recorded or stored by means of any device. (“document”)  R.S.O. 1990, c. E.23, s. 35 (1).
Where business records admissible
(2)  Any writing or record made of any act, transaction, occurrence or event is admissible as evidence of such act, transaction, occurrence or event if made in the usual and ordinary course of any business and if it was in the usual and ordinary course of such business to make such writing or record at the time of such act, transaction, occurrence or event or within a reasonable time thereafter.  R.S.O. 1990, c. E.23, s. 35 (2).
Notice and production
(3)  Subsection (2) does not apply unless the party tendering the writing or record has given at least seven days notice of the party’s intention to all other parties in the action, and any party to the action is entitled to obtain from the person who has possession thereof production for inspection of the writing or record within five days after giving notice to produce the same.  R.S.O. 1990, c. E.23, s. 35 (3).
Surrounding circumstances
            (4)  The circumstances of the making of such a writing or record, including lack of personal knowledge by the maker, may be shown to affect its weight, but such circumstances do not affect its admissibility.  R.S.O. 1990, c. E.23, s. 35 (4).
Previous rules as to admissibility and privileged documents not affected
            (5)  Nothing in this section affects the admissibility of any evidence that would be admissible apart from this section or makes admissible any writing or record that is privileged.  R.S.O. 1990, c. E.23, s. 35 (5).

Sopinka and Lederman set out the historical basis for the codification of the admissibility of certain documents in The Law of Evidence in Canada (Toronto: Butterworths, 1999) 2d at page 220:
In order to obviate the difficulties of adducing evidence of business records under the narrow, traditional common law exception, legislatures enacted, in a piecemeal fashion, provisions which facilitated the admission of particular documents and records without the attendant disruption or, or interference with, the commercial, business, or government world.  Thus, banking records…were made admissible without any necessity of calling the makers of the documents.
However, to qualify as a business record, the submitting party must show that the record was created in the “usual and ordinary course of business.”  This phrase has been widely interpreted and generally 2 criteria are required: (1) the record must have been made in the usual course of business; and (2) it was in the usual course of business to make such writing.  As Sopinka and Lederman state, the second criteria severely restricts the type of documents that may be admitted, at page 222:
Notwithstanding that documents may be made in the usual and ordinary course of business, if it is not the business custom of the activity or operation to maintain such a record, the documents are inadmissible.
On this point, Justice Douglas of the U.S. Supreme Court in Palmer v. Hoffman (1943), 318 U.S. 109 is often quoted:
[A business record] must be shown to be a record which is necessary for the systematic and mechanical conduct of the business as a commercial enterprise.  It must be a record that is routinely kept to run the business as a business.
Further, Justice Henderson in Augustine v. Inco Limited, 2006 CanLII 21783 (Ont. S.C.) stated at para. 9 “”Act, transaction, occurrence or event” does not include opinions, diagnoses, impressions, histories, summaries or recommendations.”
Also in Augustine, Justice Henderson discussed the effect of having a document admitted as a business record at para. 17:
17. If a document is admitted as a business record, the document is not admissible for any opinion expressed therein.  However, the document, whether it contains an opinion or not, is evidence that the author is of the belief of a certain state of affairs, but it is not proof of the state of affairs.  Moreover, the document also is evidence that the recipient of the document has knowledge of the author’s belief of a state of affairs.
(ii) When the business records should be introduced
While s. 35 of the Ontario Evidence Act makes it easier for business records to be admissible, it does not assist in establishing the weight a trier of fact should give those business records, as succinctly stated by the Court of Appeal for Ontario in Inno-Vite Incorporated v. De Wit Trading Co. Inc., 2008 ONCA 362 (Ont. C.A.) at para. 1: “The business records were properly admitted under s. 35 of the Evidence Act; their weight was for the trial judge.”
That leads to a tactical decision: when should business records be introduced?
Under our hypothetical, the payments made by your client are critical to the argument that appropriate amounts were paid for specific items.  The court should be shown that your client did everything it was required to do in a mechanical and reasonable way for a long time period; if there was any confusion, it was due to the plaintiff’s own unreasonable or mistaken actions.  Cheques, purchase orders, invoices or other business records which establish that your client maintained the status quo would be of assistance in establishing your client’s credibility.  While the most critical documents in the case will be the agreements, business records which establish how those agreements were executed will give the court a sense of what the parties understood about their respective obligations under the agreements.  Consequently, the business records should be dealt with as early as possible to demonstrate the competence and credibility of your client.
Part 2: Third party communications
Documents dealing with third party communications often lead to confidentiality and client-solicitor privilege issues.  Much of the case law on point deals with cases where a third party was acting on instructions of a lawyer; however, the purpose of the retainer is relevant in determining whether privilege applies, as stated by Justice Doherty of the Court of Appeal for Ontario in General Accident and Assurance Co. v. Chrusz, 1999, 44 O.R. (3d) 321 (Ont. C.A.):
…   I think that the applicability of client-solicitor privilege to third party communications in circumstances where the third party cannot be described as a channel of communication between the solicitor and client should depend on the true nature of the function that the third party was retained to perform for the client.  If the third party’s retainer extends to a function which is essential to the existence or operation of the client-solicitor relationship, then the privilege should cover any communications which are furtherance of that function and which meet the criteria for client-solicitor privilege.

Client-solicitor privilege is designed to facilitate the seeking and giving of legal advice.  If a client authorizes a third party to direct a solicitor to act on behalf of the client, or if the client authorizes the third party to seek legal advice from the solicitor on behalf of the client, the third party is performing a function which is central to the client-solicitor relationship.  In such circumstances, the third party should be seen as standing in the shoes of the client for the purpose of communications referable to those parts of the third party’s retainer.

If the third party is authorized only to gather information from outside sources and pass it on to the solicitor so that the solicitor might advise the client, or if the third party is retained to act on legal instructions from the solicitor (presumably given after the client has instructed the solicitor), the third party’s function is not essential to the maintenance or operation of the client-solicitor relationship and should not be protected.

In circumstances where no lawyer is involved, third party communications still attract principles of a right to privacy, even though the Charter does not apply in civil litigation.  In M.(A.) v. Ryan, [1997] 1 S.C.R. 157, the Supreme Court of Canada allowed the limited production and disclosure of psychiatrist records of a plaintiff who brought an civil action against a former doctor for sexual assault.  The Supreme Court noted that similar decisions need to be made on a case by case basis which balanced the rights of privacy and the public interest in the litigation.
If neither client-solicitor nor privacy issues attach to a situation, third party communications are subject to the usual rules of admissibility and the purpose for which the document is produced.  A distinction must be made between documents being admitted to show that the communication took place, or whether the truth of the communication is intended to be proven.  In both circumstances, the document must pass the necessity and reliability exception to the hearsay rule.  However, when the truth of the contents of the communication is sought to be proven, that can only be done with the testimony of one or more of the participants to the communication.
One of the main problems with third party communications is obtaining the participation of the third party.  While the Rules of Civil Procedure provide the ability to call non-parties as witnesses and seek documentary production from non-parties, ultimately obtaining sufficient participation from a non-party is problematic.  As a result, a court will likely allow the admission of circumstantial evidence dealing with the third party communications in circumstances where reasonable attempts were made to obtain the evidence directly from the third party.  The weight given to the circumstantial evidence may not be as strong as evidence obtained directly from the third party, but it may be better than not using the evidence at all.  As Sopkina and Lederman stated in The Law of Evidence in Canada (Toronto: Butterworths, 1999) 2d at page 1010:
Ordinarily, a third party within the jurisdiction must be served with a subpoena duces tecum and, in the absence of such proceedings to compel production of a document, secondary evidence will be refused…. At the very least, the party tendering the secondary evidence must show reasonable attempts to locate the document and request its production.
Part 3: Potential difficulties in proving documents at trial
Before discussing the difficulties in proving documents at trial, it is helpful to first categorize the type of document given that each type of document has different requirements for proof.  As Sopinka and Lederman stated in The Law of Evidence in Canada (Toronto: Butterworths, 1999) 2d at page 1004:
Documents may, for evidential purposes, be roughly classed into three categories.  Documents in the first category are public documents, which are normally proven by the introduction of copies.  Their content is evidence of the facts stated against strangers as well as parties and privies.  Documents in the second category, judicial documents, are proven in the same manner as public documents.  In the third category, private documents are traditionally proven by production of the original document and its evidential value is restricted to parties and privies.
Sopinka and Lederman continue on the requirements for producing a document at trial at page 1004:
When a document is produced at trial, the primary requirement for its admission is that the document, unless it falls into certain excepted categories…, be “proved”.  Proof in this context has several aspects or meanings.  First, it may mean proof that the document is what it purports to be.  In certain cases, mere production of the document or a copy thereof is sufficient for this purpose.  For some of these documents, the due execution of the document must also be proved, showing that it was signed or written by the person whom it purports to be signed or written, and when attestation is necessary, that it was attested.  Second, proof means that the document tendered in evidence is a correct copy of the original.  For this type of proof, it is not necessary that the witness have any knowledge with respect to the preparation of the original.  The witness must simply be in a position to say that he or she saw the original and that the copy is in all respects similar.  Third, proof means that the extent to which the documents are considered to establish the truth of the matters stated therein under the rules of evidence.
In Augustine v. Inco Limited, 2006 CanLII21783 (Ont. S.C.), Justice Henderson discussed the authenticity of documents at para. 6:
Documents that are admitted to be authentic or are proven to be authentic within the meaning of Rule 51.01 are admissible, subject to the other general principles set out herein. Where the authenticity of a document is not admitted and not proven, that document is not admissible.
Further, if a party makes a critical mistake in proving a fact or document at trial, the court can deal with that mistake as the court sees fit:
FAILURE TO PROVE A FACT OR DOCUMENT
52.10  Where, through accident, mistake or other cause, a party fails to prove some fact or document material to the party’s case,
(a) the judge may proceed with the trial subject to proof of the fact or document afterwards at such time and on such terms as the judge directs; or
(b) where the case is being tried by a jury, the judge may direct the jury to find a verdict as if the fact or document had been proved, and the verdict shall take effect on proof of the fact or document afterwards as directed, and, if it is not so proved, judgment shall be granted to the opposite party, unless the judge directs otherwise. R.R.O. 1990, Reg. 194, r. 52.10.

The numerous drafts and versions in the hypothetical – which should only come into play regarding the first agreement if an ambiguity is found as discussed later on – will pose problems with authentication.   Oral evidence will have to be led establishing who created the drafts, when were they created, whose handwriting appears in the margins, and if any portions were signed by whom and when.  How well the documents can be authenticated will determine whether the documents will be given any weight, apart from the fact that they may not receive any weight given the issues in the case.  Without adequate authentication, the drafts will do little in assisting the court in making findings of fact.
Part 4: Affidavit evidence as evidence-in-chief
Affidavit evidence is used as evidence-in-chief under the summary trial procedure of Rule 76.12 of the Rules of Civil Procedure, which will undergo changes effective January 1, 2010:
SUMMARY TRIAL
Procedure
76.12  (1)  At a summary trial, the evidence and argument shall be presented as follows, subject to any direction under subrule 76.10 (7):
1. The plaintiff shall adduce evidence by affidavit.
Note: On January 1, 2010, subrule (1) is amended by adding the following paragraph:
1.1 The plaintiff may examine the deponent of any affidavit served by the plaintiff for not more than 10 minutes.
See: O. Reg. 438/08, ss. 59 (1), 68 (1).
2. A party who is adverse in interest may cross-examine the deponent of any affidavit served by the plaintiff.
3. The plaintiff may re-examine any deponent who is cross-examined under this subrule for not more than 10 minutes.
4. When any cross-examinations and re-examinations of the plaintiff’s deponents are concluded, the defendant shall adduce evidence by affidavit.
Note: On January 1, 2010, subrule (1) is amended by adding the following paragraph:
4.1 The defendant may examine the deponent of any affidavit served by the defendant for not more than 10 minutes.
See: O. Reg. 438/08, ss. 59 (1), 68 (1).
5. A party who is adverse in interest may cross-examine the deponent of any affidavit served by a defendant.
6. A party shall complete all of the party’s cross-examinations within 50 minutes.
7. A defendant may re-examine any deponent who is cross-examined under this subrule for not more than 10 minutes.
8. When any cross-examinations and re-examinations of the defendant’s deponents are concluded, the plaintiff may, with leave of the trial judge, adduce any proper reply evidence.
9. After the presentation of evidence, each party may make oral argument for not more than 45 minutes. O. Reg. 284/01, s. 25.
(2)  The trial judge may extend a time provided in subrule (1). O. Reg. 284/01, s. 25.
(3)  A party who intends to cross-examine the deponent of an affidavit at the summary trial shall, at least 10 days before the date fixed for trial, give notice of that intention to the party who filed the affidavit, who shall arrange for the deponent’s attendance at the trial. O. Reg. 284/01, s. 25.
Note: On January 1, 2010, subrule (3) is amended by striking out “cross-examine” and substituting “examine or cross-examine”. See: O. Reg. 438/08, ss. 59 (2), 68 (1).

Affidavit evidence as evidence-in-chief must be looked at considering credibility and tactical factors.  Examination-in-chief is about telling the witness’ story and being able to do that in affidavit form provides greater control than oral examination.  However, the court is aware that such an affidavit is essentially self-serving and the lawyer has control of the story.  The court knows that the words were first prepared by the lawyer, unlike in oral evidence where, no matter how well prepared, the witness is the one who determines what is said.  On cross-examination, if the witness cannot adequately explain the affidavit or has trouble with some of the concepts, the credibility of the witness, and the lawyer who prepared the affidavit, is diminished.
Consequently, affidavits used as evidence-in-chief should have greater witness involvement than regular affidavits.  Lawyers should prepare the affidavit using some of the witness’ speech patterns and usual language; having the witness actually write out the responses on particular points is a good place to start.  The affidavit does not have to tell the story perfectly from a legal writing standpoint; the affidavit has to tell the witness’ story, in the witness’ own words, as effectively as possible.  The lawyer can structure the affidavit as is necessary, but the lawyer should avoid producing the affidavit to the point where the witness’ voice is lost.  The court will be able to follow the witness’ story without excessive intervention from the lawyer, and the court will take note that the lawyer had enough confidence in the witness and the witness’ credibility to refrain from exercising too much control.  The greater the credibility of the affidavit, the greater weight the affidavit and the witness’ evidence will be afforded at trial.
Part 5: Treatment of documentary evidence from the witness who is no longer able to testify
In circumstances where an individual who previously swore an affidavit or was examined for discovery is no longer able to testify, the court must determine whether that individual’s evidence should be admitted at trial, and, if so, for what purpose.  Cormack Animal Clinic Ltd. v. Potter, 2009 CanLII 713 (Ont. S.C.) dealt with whether the plaintiff’s affidavits could be admitted into evidence at trial in circumstances where the plaintiff now suffered from dementia; the evidence in the affidavits was central to the plaintiff’s case and was contentious.  Justice Corbett set out the basic principles to be considered, at para. 10:
The hearsay rule is part of the common law of evidence.  It provides that, as a general principle, the court will not admit out-of-court statements for proof of the truth of their contents.  There are exceptions to this principle, some statutory and some arising in the common law.  The relevant exception in this case is the “principled exception” to the hearsay rule.  It provides that, as a general principle, the court will receive an out-of-court statement for evidence of the truth of its contents where the conditions of both necessity and reliability are established.  This test addresses the threshold question of whether the evidence will be admitted at all.  If it is admitted into evidence, it remains for the trier of fact to assess that evidence and determine what weight, if any, should be given to it.
Traditionally, affidavit evidence (other than that used under Rule 76) will only be admitted at trial if its evidence is non-contentious.  However, as Justice Corbett states at para. 18, there appears to be a “widening of the principle to include controversial evidence in circumstances where it is impossible to obtain evidence in any other way.”  In support of this argument, Justice Corbett cites the decision of a trial judge to admit a medical report from a physician where the doctor had died prior to trial and had never been cross-examined in Scrime v. Guardian Insurance Co. (1980), 30 C.P.C. (2d) 149 (Ont Dist. Ct.), and the decision of Justice Epstein (as she then was) in Tulshi v. Ioannou, [1994] O.J. No. 1472 (Ont. Gen Div.) to admit a written expert report of an engineer who specialized in forensic work related to car accidents who died prior to trial.  However, Justice Corbett noted that Justice Epstein allowed the admission of the expert report on the stipulation that the report be supported by the oral evidence of a colleague of the deceased expert.  Justice Corbett quoted Justice Epstein’s decision at paras. 16 and 17:
I cannot see any reason why an affidavit should be treated differently than a medical report or that a medical report ought to be treated differently than any other type of expert report.  They all give rise to the identical objection: prejudice to the opposing party in not having an opportunity to cross-examine.

Counter-balancing this prejudice is the need of the trial judge to have all possible relevant evidence before him or her in order to determine the issues raised in the action.  In my view, this requirement, particularly where the evidence in question is of importance and cannot be obtained in any other way, takes priority over the prejudice suffered by a party in being deprived of its right to cross-examine, especially since this prejudice can at least be addressed by the trier of fact through a consideration of the weight to be attached to the evidence in question.  The Court should, however, attempt to go further where possible to assist in reducing the prejudice suffered by the opposing party through not being able to cross-examine.

Ultimately, Justice Corbett admitted the affidavit evidence and the limited transcripts of cross-examinations and examinations for discovery but interestingly did not admit the evidence under the traditional rules of 53.02(1) or 31.11(6) of the Rules of Civil Procedure:
EVIDENCE BY AFFIDAVIT
With Leave of Court
53.02  (1)  Before or at the trial of an action, the court may make an order allowing the evidence of a witness or proof of a particular fact or document to be given by affidavit, unless an adverse party reasonably requires the attendance of the deponent at trial for cross-examination. R.R.O. 1990, Reg. 194, r. 53.02 (1).

Unavailability of Deponent
31.11(6)  Where a person examined for discovery,
(a) has died;
(b) is unable to testify because of infirmity or illness;
(c) for any other sufficient reason cannot be compelled to attend at the trial; or
(d) refuses to take an oath or make an affirmation or to answer any proper question,
any party may, with leave of the trial judge, read into evidence all or part of the evidence given on the examination for discovery as the evidence of the person examined, to the extent that it would be admissible if the person were testifying in court. R.R.O. 1990, Reg. 194, r. 31.11 (6).
(7)  In deciding whether to grant leave under subrule (6), the trial judge shall consider,
(a) the extent to which the person was cross-examined on the examination for discovery;
(b) the importance of the evidence in the proceeding;
(c) the general principle that evidence should be presented orally in court; and
(d) any other relevant factor. R.R.O. 1990, Reg. 194, r. 31.11 (7).

Justice Corbett found that both rules were limited in some way in allowing for the admission of the evidence.  Instead, Justice Corbett found that the correct approach was the principled approach to the hearsay rule, otherwise known as a Khan application:
In my view, the best approach to this issue is not under R.53.02(1) or by analogy to R.31.11(6).  Rather, it is under the principled approach to the hearsay rule.  This approach is the core of Justice Henderson’s reasoning in Johnson Estate and embraces the important balancing of interests described by Justice Epstein in Scime. [sic Tulshi]
Justice Corbett admitted the evidence but determined that the weight it should be given could only be determined after hearing all of the evidence.
In a similar case with a different result, Master Sanderson declined to admit an expert report of an expert who had died prior to trial since the report failed the reliability test of the hearsay exception in McPherson v. Bernstein (2005), 76 O.R. (3d) 133 (Ont. S.C. [Master]).
The case law indicates that, notwithstanding Rules 53 and 31 of the Rules of Civil Procedure, if a party intends to submit evidence at trial of a party who cannot attend to speak to it directly, and that evidence is contentious, the evidence will undergo a rigorous examination of whether it should be admitted as an exception to the hearsay rule.  A lawyer will have to do a cost benefit analysis to determine whether it is worth attempting to have the evidence, the weight of which is already suspect, admitted or whether the evidence can or should be obtained by other means.
Part 6: Altered document drafts vs. final versions and distinguishing between earlier and later annotations
In Augustine, Justice Henderson discussed the effect of handwriting on a document at paras. 15 and 16 and incomplete documents at para. 21:
15. If a document is handwritten, in whole or in part, it must nevertheless satisfy some evidentiary rule in order to be admissible.
16. A handwritten note or marginalia may constitute a business record if it meets the requirements of section 35 of the Evidence Act….
21. Documents should ordinarily be tendered in a complete form. Documents may be tendered in part, with leave of the Court, where it is impractical or unnecessary to tender the complete document, provided that either party may supplement the parts tendered with other portions of the document or other relevant qualifying documents where necessary.

As discussed earlier with problems with authenticating documents, the numerous drafts and versions in the hypothetical pose challenges with authentication.  Establishing the importance of the different drafts and versions will be critical in determining the terms of the second agreement; whether the drafts of the second agreement have any effect on the first agreement can only be determined if there is an ambiguity in the first agreement and parol evidence is required to resolve that ambiguity.  The different drafts and versions should be used to establish a clear chronology of the negotiations and ultimate agreement; the drafts and versions should connect the dots to show one contract, since the luxury of one signed agreement does not exist.  Drafts and versions, and any other documents, which do not assist with that chronology are superfluous; some time can be spent with a witness to show how these extra documents are duplicative of other documents and do not require any special attention.
Picking a handful of key documents, even producing them in a separate compendium to be used at trial, would be helpful in focussing the court’s attention.  The court has no wish to wade through all of the different drafts and versions in a search to find which ones are important; that is the job of the lawyer, and if that is not done, the court will question whether the lawyer even knows which documents are important and how they fit into the case.  Also, having key documents that you keep going back to will keep your case on track if the other side tries to bring in documents that you do not think are of value.  Demonstrating that you know the case so well that you can refine the issues and documents down to a manageable amount will gain the confidence of the court both in terms of competence and your arguments on the case. You clearly gain credibility with the court if you are the one that has control and knowledge of the documentary evidence.
Part 7: Statutory notice periods
(i) Business records
As discussed earlier, notice of business records is governed by s. 35(3) of the Ontario Evidence Act and provides that 7 days notice must be given:
Where business records admissible
            (2)  Any writing or record made of any act, transaction, occurrence or event is admissible as evidence of such act, transaction, occurrence or event if made in the usual and ordinary course of any business and if it was in the usual and ordinary course of such business to make such writing or record at the time of such act, transaction, occurrence or event or within a reasonable time thereafter.  R.S.O. 1990, c. E.23, s. 35 (2).

Notice and production
            (3)  Subsection (2) does not apply unless the party tendering the writing or record has given at least seven days notice of the party’s intention to all other parties in the action, and any party to the action is entitled to obtain from the person who has possession thereof production for inspection of the writing or record within five days after giving notice to produce the same.  R.S.O. 1990, c. E.23, s. 35 (3).
However, even if insufficient notice of business records is given, the court can still admit the evidence if there is no prejudice to the opposite party.  In Kumsathira v. Pembridge Insurance Company, 2007 ONCA 53 (Ont. C.A.), an insurance coverage case, the Court of Appeal for Ontario found at para. 3:
Mr. Groff’s evidence was based upon the business records of Pembridge.  While Pembridge did not comply with the notice requirements of the Ontario Evidence Act with respect to introducing those records, it was open to the trial judge, in the circumstances of the trial, to exercise his discretion to admit this evidence.  The issue of the specifics of the lack of timely notice only crystallized during the trial and there was no prejudice to the appellants by the failure of Pembridge to give notice of its intent to introduce the business records.
The timing of having business records admitted at trial has an effect on when a witness can testify about the business records.  As stated by Sopinka and Lederman, The Law of Evidence in Canada (Toronto: Butterworths, 1999) 2d at page 43:
Facts which establish the admissibility of evidence may not yet be proved when the evidence is presented to the court.  For example, a business record might be referred to in a witness’ evidence before the record is admitted into evidence as an exception to the hearsay rule.  It is a matter for the court’s discretion whether to allow such evidence before the preliminary facts are proved.
(ii) Expert reports
Notice of an expert report is governed by Rule 53.03 of the Rules of Civil Procedure and provides that a party who intends to call an expert witness must serve a signed report by the expert not less than 90 days prior to the commencement of trial.  If a party wishes to call an expert witness to respond to the report, that party must serve a signed expert report within 60 days prior to trial.
In our hypothetical, if previous counsel had not already served the expert report, a timing issue now arises given that there is less than 2 months before the commencement of trial.
However, a court may grant leave to abridge the time for service of an expert report, as with other evidence, under Rule 53.03(4) or Rule 53.08: of the Rules of Civil Procedure:
Extension or Abridgment of Time
53.03(4)  The time provided for service of a report or supplementary report under this rule may be extended or abridged,
(a) by the judge or case management master at the pre-trial conference or at any conference under Rule 77; or
(b) by the court, on motion. O. Reg. 570/98. s. 3.

53.08(1)  Where evidence is admissible only with leave of the trial judge under a provision listed in subrule (2), leave shall be granted on such terms as are just and with an adjournment if necessary, unless to do so will cause prejudice to the opposite party or will cause undue delay in the conduct of the trial.

In McPherson v. Bernstein (2005), 76 O.R. (3d) 128 (Ont. S.C.J.), Master Sanderson permitted an abridgment of time for service of an expert report in circumstances where the author of the original expert report had died and that report was not admissible having failed the reliability test of the hearsay exception.  Master Sanderson found at paras. 30-34:
[30] I agree with [the defendants’] submission that expert evidence should be excluded if its admission would cause more prejudice to the responding party than its exclusion would cause to the moving party. See Weishar v. Citadel Assurance, [1997] O.J. No. 718 (Gen. Div.) at para. 8; Brink v. Timberjack Inc., [2004] O.J. No. 4610 (S.C.J.) at paras. 26-27; Gilmour v. Miller Estate, [1993] O.J. No. 2784 (Gen. Div.), affirmed [1997] O.J. No. 3049 (C.A.).
[31]  While Dr. Bernstein’s counsel submit that their expert on standard of care, Dr. Paul McCleary, has not yet seen the reports of Dr. Muggah or Dr. Frank, they declined my offer to adjourn the trial to provide him time to respond to the evidence of Drs Frank and Muggah.
[32]  This litigation was commenced in 1998. Dr. Bernstein was discovered in July 2001. He has had every opportunity to preserve his evidence. I do not believe that a short adjournment would unduly affect the quality of his memory of the events at issue in this litigation.
[33]  Having considered all the circumstances and having offered to adjourn the trial and to provide an early trial date to avoid further undue delay, I am of the view that if the requested order were not granted, the Plaintiffs would suffer greater prejudice than Dr. Bernstein would suffer by reason of a brief adjournment.
(iii) Other documents
Rule 51 of the Rules of Civil Procedure provides that a party may request the other party to admit the truth of a fact or the authenticity of a document.  While an admission has particular relevance when it comes to evidence used at trial, Rule 51 can be utilized “at any time” and must be responded to within 20 days:
RULE 51 requests to admit
INTERPRETATION
51.01  In rules 51.02 to 51.06,
“authenticity” includes the fact that,
(a) a document that is said to be an original was printed, written, signed or executed as it purports to have been,
(b) a document that is said to be a copy is a true copy of the original, and
(c) where the document is a copy of a letter, telegram or telecommunication, the original was sent as it purports to have been sent and received by the person to whom it is addressed. R.R.O. 1990, Reg. 194, r. 51.01.
REQUEST TO ADMIT FACT OR DOCUMENT
51.02  (1)  A party may at any time, by serving a request to admit (Form 51A), request any other party to admit, for the purposes of the proceeding only, the truth of a fact or the authenticity of a document. R.R.O. 1990, Reg. 194, r. 51.02 (1).
(2)  A copy of any document mentioned in the request to admit shall, where practicable, be served with the request, unless a copy is already in the possession of the other party. R.R.O. 1990, Reg. 194, r. 51.02 (2).
EFFECT OF REQUEST TO ADMIT
Response Required Within Twenty Days
51.03  (1)  A party on whom a request to admit is served shall respond to it within twenty days after it is served by serving on the requesting party a response to request to admit (Form 51B). R.R.O. 1990, Reg. 194, r. 51.03 (1).
Deemed Admission Where No Response
(2)  Where the party on whom the request is served fails to serve a response as required by subrule (1), the party shall be deemed, for the purposes of the proceeding only, to admit the truth of the facts or the authenticity of the documents mentioned in the request to admit. R.R.O. 1990, Reg. 194, r. 51.03 (2).
Deemed Admission Unless Response Contains Denial or Reason for Refusal to Admit
(3)  A party shall also be deemed, for the purposes of the proceeding only, to admit the truth of the facts or the authenticity of the documents mentioned in the request, unless the party’s response,
(a) specifically denies the truth of a fact or the authenticity of a document mentioned in the request; or
(b) refuses to admit the truth of a fact or the authenticity of a document and sets out the reason for the refusal. R.R.O. 1990, Reg. 194, r. 51.03 (3).

However, even if proper notice has been given or the document is admitted pursuant to a request to admit, the use of that document is still subject to scrutiny.  In Wunsche v. Wunsche, 1994 CanLII 548 (Ont. C.A.), the Court of Appeal for Ontario ordered a new trial when the trial judge relied on a valuator’s report which had been part of a request to admit.  Justice Osborne, writing for Justices Arbour and Abella (as they then were), found:
It is clear that the appellant failed to serve a response to the respondent's Request to Admit.  Thus, by the operation Rule 51.03(2) he was deemed to admit the truth of the fact that the valuator placed a value of $1,066,000.00 on his corporate holdings and the authenticity of the April 30, 1987 valuation report.

In my view, the deemed admission established by Rule 51.03(2) can be no greater than this.  The appellant, by the operation of the rule, is deemed to have accepted the authenticity of the valuation report and the fact that the valuator had expressed the opinion that the appellant's shares in his four companies had a valuation date value of $1,066,000.00.  The deemed admission is not an admission by the appellant that his shares in fact had a value of $1,066,000.00, but rather an admission that a particular valuator had concluded that his shares had that value.  The appellant was not asked to admit the truth of the valuator's statement of opinion, but simply the fact that it was made.  Rule 51.03 creates deemed admissions.  It does not, by its application, make what is manifestly hearsay evidence admissible.  See Canpotex Ltd. et al. v. Graham et al. (1985), 5 C.P.C. (2d) 233 (H.C.J.).

Part 8: Current state of the parol evidence rule
The general rule as it relates to parol evidence is that extrinsic evidence is not admissible to add or vary a contract, and the rule relates to written documents as well as oral evidence: Candev Financial Services Ltd. v. Klein (1994), [1994] O.J. No. 1946, 1994 CarswellOnt 1048, 34 C.P.C. (3d) 122 (Ont. Gen. Div.) at paras. 10, 11, 12.   Sopinka and Lederman discussed the parol evidence rule and its exceptions in The Law of Evidence in Civil Cases (Toronto: Butterworths, 1974), at page 267-69:
Although some noted writers have denied that the Parol Evidence Rule is an evidential principle at all and insist that it is a rule of substantive law delineating what facts are legally effective when there is a written document, it is inserted in this work because it involves the exclusion of certain facts and thus relates to the admissibility of evidence. The classic statement of the rule was given by Denman C.J. in Goss v. Nugent [(1833), 5 B. & Ad. 58 at 64 (Eng. K.B.)]:

By the general rules of the common law, if there be a contract which has been reduced into writing, verbal evidence is not allowed to be given of what passed between the parties, either before the written instrument was made, or during the time that it was in a state of preparation, so as to add to or subtract from, or in any manner to vary or qualify the written contract ...

Although the rule is known as the “parole” evidence rule, it encompasses all prior or contemporaneous transactions between the parties whether they are oral or written. Burton J.A. aptly explained the rationale for the rule in an early Ontario decision [Ellis v. Abell (1884), 10 O.A.R. 226 at 247 (Ont. C.A.)]:

 ... and it is well to bear in mind the reason of the rule, that when parties have deliberately put their engagements in writing in such language as imports a legal obligation it is only reasonable to presume that they have introduced into it every material term and circumstance; and consequently all parol testimony of conversations or declarations made by either of them, whether before or after or at the time of the completion of the contract, will be rejected, because such evidence, while deserving far less credit than the writing itself, would inevitably tend in many instances to substitute a new and different contract for the one really agreed upon.

The crucial question then becomes: What was the intent with which the written instrument was made? Did the parties intend that the written documents supersede the prior declarations that passed between them which now, in some way, compete with the subsequent written document? The rule is designed to prevent the use of fabricated or unreliable extrinsic negotiations to attack formal written contracts which were intended to be the final embodiment of the transactional terms between the parties. If the written instrument was not intended to integrate the entire transaction, then no prohibition to the adducement of parol evidence exists. Accordingly writings such as receipts, letters and memoranda are not affected by the Parol Evidence Rule for such documents do not by themselves impose legal obligations. On the other hand, any documents which are of a contractual nature such as deeds, mortgages, leases, bills of sale, and contracts cannot be undermined by evidence of previous negotiations.
Generally, the parol evidence rule comes into play whenever there is an ambiguity in a contract; parol evidence may then generally be used to assist in resolving that ambiguity.
The current state of the parol evidence rule is set out in two recent Court of Appeal for Ontario decisions, one which shows when parol evidence can be used and one where it cannot.  In Turner v. Donato, 2009 ONCA 235 (Ont. C.A.), a family law case that dealt with the interpretation of a settlement agreement, Epstein J.A. writing for the court, stated at para. 44:
In my view, the trial judge did not err by failing to consider Ms. DiDonato’s admissions regarding her understanding of the insurance obligation in the Agreement.  In resolving disputes arising from the interpretation of contracts, the objective is to protect the reasonable expectations of the parties, as set out in the language of their agreement.  In the absence of ambiguity in the words of the contract, parole evidence of the subjective intention of the parties has no place in the interpretive exercise:  see Eli Lilly & Co. v. Novopharm Ltd. 1998 CanLII 791 (S.C.C.), [1998] 2 S.C.R. 129, at paras. 54-56. The trial judge found that the Agreement reflected the DiDonatos’ expectations in a clear and unambiguous manner – neither party has challenged that conclusion before this court.  On the contrary, in advancing her own interpretation of the Agreement, Ms. Turner maintains that it is not ambiguous.  She thereby implicitly acknowledges the irrelevance of extrinsic evidence in this case. [Emphasis added]
In Dunn v. Chubb Insurance Company of Canada, 2009 ONCA 538 (Ont. C.A.) a directors and officers insurance case, the Court of Appeal ordered a new hearing of an application after finding an ambiguity in the policy.  The Court of Appeal stated at para.  34:
A contractual provision is ambiguous if it is reasonably susceptible of more than one meaning: Hi-Tech Group Inc. v. Sears Canada Inc. 2001 CanLII 24049 (ON C.A.), (2001), 52 O.R. (3d) 97 (C.A.), at para. 18.  Extrinsic or parol evidence may be admitted to assist in resolving an ambiguity: United Brotherhood of Carpenters and Joiners of America, Local 579 v. Bradco Construction Ltd., 1993 CanLII 88 (S.C.C.) , [1993] 2 S.C.R. 316, at p. 342; Eli Lilly at para. 55.  For example, extrinsic evidence regarding the negotiations leading up to an agreement may be admitted if the contract is ambiguous, but not if the language of the contract is clear: see Canadian Premier Holdings Ltd. v. Winterthur Canada Financial Corp. 2000 CanLII 5724 (ON C.A.) , (2000), 132 O.A.C. 172 (C.A.), at para. 15; SimEx Inc. v. IMAX Corp.2005 CanLII 46629 (ON C.A.) , (2005), 206 O.A.C. 3 (C.A.), at para. 23. [Emphasis added]
Overall, while the court is reluctant to use parol evidence, parol evidence will be used to assist the court in resolving an ambiguity.
Part 9: Status of the written expert report
New rules of the Rules of Civil Procedure effective January 1, 2010 set out specific requirements that all written expert reports must have.  Rule 53.03 (2.1) and (2.2) sets out the requirements for an expert reports:
(2.1)  A report provided for the purposes of subrule (1) or (2) shall contain the following information:
1. The expert’s name, address and area of expertise.
2. The expert’s qualifications and employment and educational experiences in his or her area of expertise.
3. The instructions provided to the expert in relation to the proceeding.
4. The nature of the opinion being sought and each issue in the proceeding to which the opinion relates.
5. The expert’s opinion respecting each issue and, where there is a range of opinions given, a summary of the range and the reasons for the expert’s own opinion within that range.
6. The expert’s reasons for his or her opinion, including,
i. a description of the factual assumptions on which the opinion is based,
ii. a description of any research conducted by the expert that led him or her to form the opinion, and
iii. a list of every document, if any, relied on by the expert in forming the opinion.
7. An acknowledgement of expert’s duty (Form 53) signed by the expert. O. Reg. 438/08, s. 48.

If anything, the new requirements are the codification of factors already present in most expert reports.  However, the new requirements should provide some consistency in what the reports contain and will allow the court to determine how successful the expert was in fulfilling each criterion.  How well an expert deals with these criteria will likely play as much into the expert’s credibility as does the opinion the expert ultimately expresses.
In the hypothetical, the expert report dealing with the differences in the parts should clearly state that the expert was asked to determine the differences in the parts and that the expert understands the duty of an expert.  Further, the list of documents and facts on which the expert relied should be considered on the grounds of admissibility and contentiousness.  If the expert’s opinion is based on evidence there will be difficulty in getting admitted or verifying, the weight of the expert report will be greatly reduced.
Part 10: The new E-Discovery Rules
(i) General principles
Part of the difficulty with working out the evidence rules discussed above is combining different rules and different strategies.  The new e-discovery rules will likely streamline and consolidate both previous rules and strategies.
The new e-discovery rules are on the principles established by the Sedona Conference Group, which states that “Electronic discovery”:
refers to the discovery of electronically stored information, including e-mail, web pages, word processing files, computer databases, and virtually any information that is stored on a computer or other electronic device.  Technically, information is “electronic” if it exists in a medium that can be read through the use of computers or other digital devices.
Effective January 1, 2010, Rule 29.01 of the Rules of Civil Procedure requires that parties in an action must agree to a written “discovery plan” 60 days after the close of pleadings or as agreed to by the parties.  The discovery plan must include:
the intended scope of documentary discovery taking into account relevance [the test being “direct relevance” not “semblance of relevance” as is now employed], costs and the importance and complexity of the issues;
the dates for service of each party’s affidavit of documents;
information respecting the timing, costs and manner of the production of documents;
the names of persons intended to be produced for discovery and information respecting the timing and length of examinations; and
any other information intended to result in the expeditious and cost-effective completion of the discovery process in a manner that is proportionate to the importance and complexity of the action.
Rule 29.1.03(4) requires that the discovery plan must be made having regard to the “Sedona Canada Principles Addressing Electronic Discovery.”  The basic Sedona principles are:
electronically stored information is discoverable;
the parties should ensure that steps are taken in the discovery process that are proportionate, taking into account: (i) the nature and scope of the action, including the importance and complexity of the issues, interest and amounts at stake; (ii) the relevance of the electronically stored information; (iii) its importance to the court’s adjudication in a given case; and (iv) the costs, burden and delay that may be imposed on the parties to deal with electronically stored information;
as soon as litigation is reasonably anticipated, parties must consider their obligation to take reasonable and good faith steps to preserve potentially relevant electronically stored information;
counsel and parties should meet and confer as soon as practicable, and on an ongoing basis, regarding the identification, preservation, collection, review and production of electronically stored information;
the parties should be prepared to produce relevant electronically stored information that is reasonably accessible in terms of cost and burden;
a party should not be required, absent agreement or court order based on demonstrated need and relevance, to search for or collect deleted or residual electronically stored information;
a party may satisfy its obligation to preserve, collect, review and produce electronically stored information in good faith by using electronic tools and processes such as data sampling, searching or by using selection criteria to collect potentially relevant electronically stored information;
parties should agree as early as possible in the litigation process on the format in which electronically stored information will be produced;
during the discovery process parties should agree to or, if necessary, seek judicial direction on measures to protect privileges, privacy, trade secrets and other confidential information;
during the discovery process, parties should anticipate and respect the rules of the forum in which the litigation takes place;
sanctions should be considered by the court where a party will be materially prejudiced by another party’s failure to meet any obligations to preserve, collect review or produce electronically stored information.  The party in default may avoid sanctions if it demonstrates the failure was not intentional or reckless; and
the reasonable costs of preserving, collecting and reviewing electronically stored information will generally be borne by the party producing it.
(ii) Obligations of counsel
Under the new e-discovery rules, a lawyer must:

1. inform clients of their e-discovery obligations, including a request to suspend any activities that could lead to a loss of relevant information, as soon as litigation is reasonably anticipated;

provide a letter to opposing counsel regarding their e-discovery obligations, including a request to suspend any activities that could lead to a loss of relevant information;
meet and confer with clients as soon as is practicable and on an ongoing basis regarding the identification, preservation and production of electronically stored documents;
agree to a discovery plan with opposing counsel within 60 days after the close of pleadings or make alternate arrangements; and
follow the e-discovery checklist to ensure all required steps have been taken.
Lawyers are being encouraged to have clients (especially regular clients) establish company protocols for the retention of electronically stored information and the hardware used by the client.  Those protocols regarding a records management system should be established with the assistance of counsel considering the Rules of Civil Procedure, the Sedona principles, and any current case law (of which there will likely be a great deal).
(iii) Practical considerations
The new rules will likely result in an increase in motions seeking to limit the pleadings, thereby reducing the amount of documentary production.  Further, the court will be reluctant to order or endorse any discovery plan the costs of which are not proportionate to the amount being claimed in the action.
With the new “discovery plan,” parties will now have to decide earlier the importance of particular documents.  Instead of simply producing everything with an affidavit of documents, parties must now also consider the “importance and complexity of the issues.”  Having to make this determination 60 days after the close of pleadings will force parties to focus their case earlier in the action.
In the hypothetical, if the case began after January 1, 2010, the parties would have to come up with a discovery plan which somehow dealt with the volumes of emails and try to do so on a cost effective and proportionate basis.  Further, there would be a duty on counsel to inform the client to take reasonable steps to protect all documents as soon as litigation is reasonably anticipated.  Undoubtedly, there will be a large amount of case law dealing with a lawyer’s duty regarding e-discovery and the practical difficulties of dealing with e-discovery.
Conclusion
In this age of email, it is indeed a rare case where there are few documents to be considered.  More typically, lawyers must wade through a morass of disorganized and ultimately unimportant documents as in the hypothetical.  It is the lawyer’s job to make sense of that mess and tell the client’s story effectively and persuasively.
In this day and age it is easy to get lost in the volume and lose sight of the story.  Focussing on key documents is part of effective advocacy and will make for a better, more organized and ultimately effective trial presentation.

By Gary Luftspring gluftspring@rickettsharris.com 416.364.6211 Ext. 282

By Sam Sasso ssasso@rickettsharris.com 416.364.6211 Ext. 285