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The implied undertaking revisited

Research articles : 
 
I.          INTRODUCTION
One of the greatest tools of modern civil litigation is the discovery process. By increasing the availability of information, reducing inequalities in bargaining power and minimizing the element of surprise, discovery helps to improve cost and time efficiency and ultimately facilitates the truth-finding process. From a public policy standpoint, the discovery process is crucial because of these benefits. For the parties to a dispute, however, the intrusion on privacy caused by discovery may act as a deterrent to full and honest disclosure or as an incentive for private dispute resolution.
 
In response to those concerns, numerous procedural safeguards have developed to balance the public interest in encouraging full disclosure so that the truth may be discovered and justice served with the desire to minimize intrusions on privacy and property rights and reduce perverse incentives.[1] One such safeguard is the implied undertaking of confidentiality, which circumscribes the use that a party receiving discovery may make of the information it obtains. Where the implied undertaking exists, the party in receipt of information is deemed to give an undertaking to the court that it will not use that information for any collateral or ulterior purpose unrelated to the litigation at hand. The implied undertaking of confidentiality is made to the court and its breach constitutes contempt of court. The rationale for the implied undertaking is:[2]
 
to ensure full and complete disclosure while maintaining the confidentiality of a private process. The principle driving this undertaking is that the discovery process represents au intrusion on the general right to privacy under the compulsory process of the Court. The necessary corollary is that this intrusion should not be allowed for any purpose other than that of securing justice in the proceeding in which the discovery takes place.
 
The implied undertaking is a relatively recent addition to Canadian law, having first been discussed domestically in l985.[3] Although the concept of an implied undertaking now exists in every Canadian jurisdiction,[4] its existence should not be taken for granted. Indeed, the implied undertaking was expressly held not to form part of British Columbia law by the British Columbia Court of Appeal in 1986, which position was not reversed until l994.[5] Similarly, Ontario courts went both ways on the issue until the Ontario Court of Appeal pronounced on it in 1995.[6] To date only three provinces Ontario, Prince Edward Island and Manitoba have legislated in this area.[7]
 
Moreover, although there is agreement on the basic idea that an implied undertaking of confidentiality attaches to information received on discovery, the form and scope of the implied undertaking still vary significantly across domestic jurisdictions. For example, whereas in most provinces the implied undertaking expires when the documents to which it attaches are adduced in open court, in British Columbia, Alberta and Nova Scotia there is no end to the implied undertaking absent a court order to that effect. Internationally, the differences are even more pronounced: in the United States for instance, the implied undertaking of confidentiality simply does not exist and the burden falls on the party making production to obtain either an express agreement of confidentiality from the receiving party or a protective order from the court.[8]
 
The divergence in treatment of the issue is not surprising as there are theoretical and practical considerations supporting a variety of approaches to the subject. Unfortunately, the relevant academic literature is scarce and outdated and no contemporary work exists that addresses all the relevant issues.[9] Most of the Canadian articles on this topic were published in the early to mid-1990s when the main question was whether or not the implied undertaking should exist rather than what its form and scope should be if it did exist.[10]
 
My goal here is to assess the implied undertaking rule by considering various aspects of the rule in the context of broad normative values. I conclude that there are several legitimate approaches to the broader problem of confidentiality in discovery but that as far as the implied undertaking itself is concerned, there are two main issues: (a) should the undertaking attach by default, or should it be imposed only upon application of the parties and (b) how long should the undertaking last. The analysis suggests that the ideal approach is to legislate a scheme wherein the undertaking does not automatically attach, but where it is readily available to litigants who require it, and where, if the undertaking applies, it is deemed to be of indeterminate duration (i.e. removable only by order of the court).
 
The article is divided into three sections. Section 1 explores the current state of the law across various jurisdictions and highlights the key differences between them. The emphasis of this section is on Canadian jurisdictions (Quebec is excluded from the analysis) but foreign laws are also considered. Section 2 comprises the bulk of the analysis. It discretely analyzes the three key aspects of the implied undertaking and offers a normative assessment of the law in light of that analysis. Section 3 draws on the conclusions of Section 2 and makes recommendations for a uniform approach to the problem. The article concludes with some suggestions for further study.
 
II.        CURRENT LEGAL FRAMEWORK[11]
1.         United Kingdom
The Rules of the Supreme Court were amended in 1987 to codify the implied undertaking of confidentiality.[12] The undertaking is deemed to end when the documents to which it attaches are adduced in open court. Civil Procedure Rule 31.22[13] provides that the party in receipt of a document[14] may use it only for the purposes of the proceedings in which it was disclosed, unless and until that document is referred to at a public hearing. The undertaking can also terminate with permission of the owner of the document or by court order.
 
2.         United States
The implied undertaking does not exist in the United States.[15] Absent an express confidentiality agreement between the parties or an order of the court, there are no restrictions on the uses to which materials received on discovery may be put. In practice, however, it is typically the case that arrangements are made to ensure that disclosed information not filed with the court remains confidential.
 
Pursuant to Federal Rule of Civil Procedure 26(c),[16] which has been adopted in may states,[17] a party to an action may motion the court for a protective order to keep disclosed materials confidential. Federal Rule 26(c) has also been used by the courts, on application by both parties, to ratify a confidentiality agreement made between them.[18] Commentators have noted that it is rare for a court to refuse to sanction such agreements.[19]
 
If the agreement seeks to maintain confidentiality beyond the pretrial stage, it can raise public policy and First Amendment issues. Indeed, once material has been filed with the court the principle of public access to court records creates a presumption that the material will be available to the public. However, where the agreement or order is limited to securing confidentiality of discovery information at the pretrial stage, as it typically does, those concerns do not apply.[20]
 
Therefore, although the American system is structurally different from the Canadian and U.K. ones, the practical result is very similar: information received on discovery usually remains confidential until it is used as part of a lawsuit, at which point the public right of access
prevails.
 
3.         Canada
The implied undertaking exists, in some form or another, everywhere in Canada.[21] In most jurisdictions it remains a creature of the common law but, in Ontario, Manitoba and Prince Edward Island, the implied undertaking has been codified and is referred to as the “deemed” undertaking (the text of the rule is identical in all three provinces).[22]
 
The codified version of the undertaking reaches farther than its equivalent in the United Kingdom. Not only does it attach to documentary discovery but also to oral discovery, inspection of property and to medical examinations. However, since the deemed undertaking applies only to evidence or information obtained under the specifically enumerated provisions, it does not extend to areas such as bankruptcy proceedings or to information obtained by the exercise of “the inherent equitable jurisdiction of the court”.[23]
 
The deemed undertaking ceases to apply when the evidence it pertains to is filed with the court or referred to during a hearing. This provision is also broader than its U.K. counterpart where mere filing with the court is insufficient to relieve against the undertaking. However, similarly to the U.K. law, the deemed undertaking can also be relieved by agreement of the owner of the information and the court retains the discretionary power to relieve against the undertaking “if satisfied that the interest of justice outweighs any prejudice that would result to a party who disclosed evidence”.[24]
 
In the rest of the Canadian provinces, the territories and in federal proceedings, the common law implied undertaking applies.[25] Owing to the common English precedent, the rule is similar in all jurisdictions. It attaches to all oral and documentary evidence obtained on discovery, its breach is punishable by contempt proceedings[26] and the court has the power to relieve of the undertaking. However, some aspects of the rule have received varying treatment. The most significant difference is in the duration of the undertaking. Also important is the applicability of the rule to information that could have been obtained by legitimate means other than litigation. Each is discussed in turn.
 
4.         Duration
In British Columbia, Alberta and Nova Scotia the implied undertaking remains in force even after the information to which it pertains has been adduced in open court.[27] This stands in stark contrast to the prevalent position that the undertaking expires as soon as the information becomes publicly available.
 
Interestingly, none of the relevant judgments analyze the issue in much detail. In the Alberta action, Lutz J. stated that “[t]he implied undertaking . . . continue[s] after the use of the information in court and thereafter except with leave of the court”.[28] He did not support that statement with any authority save a cursory reference to Harman which had, at the time of his judgment, already been modified by the amendment to the English rules.[29]
 
In British Columbia, Williams C.J.S.C. considered the issue too fraught with policy implications to be determined by a court:[30]
 
[S]hould the receiving party be able to bring any application, disclose the otherwise confidential documents and thereby do an “end run” around the undertaking for its own purposes?
 
Should disclosure in a chambers application, filing in a public registry or even disclosure in open court, all of which are extremely limited disclosures, be a rationale for ending an implied undertaking . . . ?
            . . . . .
These and other policy issues surrounding this important point should, it seems to me, be carefully considered by the appropriate committees rather than be determined than by a judge in my position . . .
 
In Nova Scotia, Chipman J.A. found the rationale for the existence of the undertaking alone “so compelling”[31] that he was afraid to restrict its ambit in any way whatsoever. Rather than follow the rule-makers in the United Kingdom, he preferred (without explanation) to adopt the reasoning of Lord Keith in Harman and make the undertaking persist even after the information it attached to was revealed in open court.
 
The benefits and drawbacks of releasing the implied undertaking once the information that it pertains to is used in public proceedings are discussed more fully in Section 2. It is apparent, however, that the Canadian jurisprudence denying such a release has lacked in principled argument. Absent a more structured approach to the problem. the implication is that British Columbia, Alberta and Nova Scotia may have to bring themselves in line with the rest of the country through legislative amendment or otherwise.[32]
 
5.         Information Obtainable Otherwise by Legitimate Means
Another aspect of the implied undertaking on which there is disagreement (or at least uncertainty) between Canadian jurisdictions is in respect of the applicability of the undertaking to information that could have been obtained by legitimate means other than the litigation. Unlike the question of duration, which has been addressed everywhere in Canada, this issue has only been addressed in six jurisdictions.[33]
 
In Ontario, Manitoba and Prince Edward Island, the legislated form of the deemed undertaking is not clear on the question. The relevant rule provides that the undertaking “does not apply to evidence or information obtained otherwise than under”[34] the enumerated provisions of the rule. On a literal reading, it therefore appears that if evidence was “obtained” under one of the enumerated provisions (e.g. on discovery), then regardless of whether it was also publicly available at the time of receipt, such evidence would be subject to the undertaking. However, Moldaver J. (as he then was) in the Divisional Court in Goodman v. Rossi, which served as the basis for the inclusion of this subrule in Ontario,[35] clarifies in his judgment that the rule should apply only to “information which the receiving party could not otherwise have obtained by legitimate means independent of the litigation process”.[36] Therefore, it is safe to conclude that the legislated form of the undertaking includes this exception.
 
The Federal Court has also held that the undertaking does not attach to information that was otherwise publicly available.[37] Conversely, in Alberta the rule is that the undertaking applies even to information that could have been obtained by other legitimate means.[38] In Nova Scotia, the Court of Appeal recognized the issue but considered it too complicated to be dealt with by the courts, and recommended it be addressed by rules committees.[39]
 
 
III.       ANALYSIS
Although the practical need for a mechanism to preserve confidentiality is recognized across jurisdictions, and despite the increasing agreement on how that is best achieved, there remain widespread divergences between jurisdictions. Indeed, there are a variety of legitimate approaches to the problem. The purpose of the analysis that follows is to evaluate whether an ideal scheme exists and what it might be. This is done by considering three questions that address different aspects of the rule:
  • Should the implied undertaking exist?
  • How long should it last?
  • For what purposes should it attach (when should it be released)?
1.         Should the Implied Undertaking Exist?
The first and most fundamental problem is whether the implied undertaking should exist. Unfortunately, this question is deceivingly simple. Indeed, much of the analysis both academic and in the courts has incorrectly confused it with the question of whether it is necessary to maintain confidentiality of discovered information.[40] For example, the recurring debate about the optimal balance between privacy rights and openness of courts addresses the desirability of having this type of information available to the public versus the desirability of keeping it confidential.[41] The reason why this approach to the question is incorrect is that a conclusion that confidentiality is indeed important does not necessarily warrant a finding that the implied undertaking should exist.
 
The existence or absence of the implied undertaking is a default position that the trial court retains jurisdiction to reverse. If the default is that the implied undertaking exists, then a party may apply to the court for removal of that undertaking. Conversely, if the default is that the implied undertaking does not exist, then a party may apply to the court for imposition of such an undertaking. Therefore, the objective of confidentiality can be achieved regardless of whether or not the implied undertaking automatically attaches.
 
Of course, if confidentiality is deemed to be unnecessary, then the issue of availability of an undertaking falls away: it should simply not be available, either by default or on application. However, if confidentiality is desirable, then other considerations must dictate the decision of whether the party responsible for making the application to the court should be the one requesting confidentiality or the one seeking to be relieved from the implied undertaking.
 
This discussion is therefore separated into two questions. First, is it desirable to maintain confidentiality of discovered information? If not, then an undertaking is not necessary in any form. Second, if confidentiality is desirable, then should discovered information automatically be confidential, or should it become confidential only on application by one of the parties’?
 
(a)        Desirability of Confidentiality
The public dispute resolution system is peculiar in that it juxtaposes two seemingly contradictory objectives, resolution of an inherently private dispute on the one hand, with the open courts principle on the other. All parties choosing to litigate inevitably face some intrusion on their privacy. There is, however, a recognition that it may be necessary to curtail that intrusion and, where the circumstances so warrant, a variety of measures can be ordered to preserve privacy. For instance, a publication ban may be imposed, documents may be sealed or an express order of confidentiality may be granted.
 
With respect to information received on discovery, there are a number of concerns that militate in favour of confidentiality. First, discovery covers a great deal of information, much of which is, as an evidentiary matter, neither relevant nor admissible. The only restriction on production is in respect of privileged documents. It seems wrong, therefore, to allow such a great volume of information, which could cover any aspect of the litigants’ private matters and be highly embarrassing, to become public. With today’s unprecedented ability to record and transmit massive amounts of information at the click of a mouse, the concern is even more elevated.[42]
 
Second, in addition to encroaching on privacy rights, an absence of confidentiality could invade property rights. The broad scope of discoverable information means that, in commercial litigation, disclosed information may include trade secrets or other information that could be valuable to competitors. In these cases, not only would it be unfair to the discovering party to make the information public but a fear of exposure could have a chilling effect on incentives to innovate.
 
Finally, if confidentiality were not available, perverse incentives would be generated. Parties might decide to initiate lawsuits even in the absence of a legitimate cause of action with the goal of obtaining, on discovery, otherwise confidential information. Also, a party being required to make disclosure would have a disincentive to honest discovery.[43]
 
Arguments have also been made in favour of curtailing confidentiality. It has been suggested that, particularly in product liability suits, confidentiality of discovered information could jeopardize public health and safety.[44] The strength of that argument is reduced by the consideration that the most damning information is likely to be adduced in open court. Where there are issues of health and safety that preoccupy the public, the trial will attract the interest of the media and the evidence revealed in court will be reported.[45] Moreover, “the number of cases that conceivably could contain information that has any bearing on public health or safety is minuscule compared to the corpus of litigation”[46] and it would be imprudent to base a scheme on a concern that only materializes in a handful of cases.
 
It has also been suggested that there is an efficiency gain in facilitating sharing of discovery by similarly situated plaintiffs. If information received on discovery is publicly available, other potential plaintiffs can make a more educated decision about whether to litigate or not. The number of frivolous lawsuits would be reduced, resulting in cost and time savings. Although plausible, the argument fails to explain why such efficiency gains could not be just as easily achieved by a removal of confidentiality on a case-by-case basis. In other words, while giving good reason for the sharing of discovered information in specific circumstances, it does not justify a blanket absence of confidentiality.
 
Finally, a popular argument is that to be consistent with the principle of open courts, discovered information should be public. The open courts principle is discussed more fully below, in Section 2(2)(a). At this stage, suffice it to say that the argument hinges on the justification for the open courts principle. If the purpose of public dispute resolution is to shed light onto the litigants’ private affairs, then the argument is sensible; but if, as has been supported by numerous judgments, the purpose of public dispute resolution is to scrutinize the judicial process and ensure that justice is done, then the argument carries far less weight. Public availability of discovered information has nothing to do with ensuring the propriety of the adjudication process.
 
All the arguments against confidentiality suffer from the same deficiency: none of them support the contention that confidentiality should never be available. They do provide compelling arguments in favour of public dissemination of information in particular circumstances but they do not suggest that some form of an undertaking should never be available. It is clear that there are cases where confidentiality should be removed, but there are also persuasive arguments for preserving privacy. Therefore, there is no question that some sort of mechanism for an application of an undertaking of confidentiality is necessary. Having established that, the question that follows is, what should the default position be’?
 
(b)        Default Position
It was noted earlier that during the course of litigation it may be necessary to impose restrictions on what information may reach the public, for example through publication bans or sealing of documents. In such cases, the general principle is that the information in question is by default public unless grounds exist for shielding it from public exposure. Therefore, the onus is usually on the person seeking to restrict public access to documents to apply to the court for such relief. The implied undertaking rule, however, takes the opposite approach, requiring the party who wishes to use the information outside of the litigation to apply to the court.
 
Is there a justification for the dissimilar treatment? Perhaps discovery is different from other processes in that it takes place largely without the involvement of the court. Because of this, it should not be subjected to the same principles of open court as other information, such as that elicited on examination of a witness. However, there are other processes that take place outside the control of the court and that are, by default, public. For example, a statement of claim, once filed, is available to the public for inspection.[47]
 
A more plausible reason for treating discovery differently than other information revealed in litigation is that discovery is court-compelled. By virtue of being sued, a party is forced to divulge a great deal of private information, much of which may later be declared inadmissible at trial. In such circumstances, it seems unfair to put the burden on the party disclosing information to explain why it should remain confidential. As Moldaver J. wrote:[48]
 
[A]s a matter of basic fairness . . . the onus should rest with the party who wishes to use court-compelled private information for a purpose other than that for which it was provided to show cause why this should be permitted.
 
Practical considerations must also play a role in the selection of a default scheme. The reality of litigation today is that discovery is voluminous. The existence of the implied undertaking saves the disclosing party the expense of having to inspect thousands of documents to determine in respect of which ones confidentiality should be requested, and how the request for confidentiality should be justified.[49] On the other hand, practitioners already examine all information that is potentially subject to discovery to determine whether it is privileged. The cost of deciding which documents should attract confidentiality, if done at the same time, should be marginal.
 
Another practical consideration is that by making the undertaking available only on request of the parties, it can be tailored more adequately to the circumstances of the case. The party seeking to protect confidentiality can best see how disclosure would be of harm and can best articulate the required protection. However, as noted by McEachern C.J.S.C. in United Services Funds v. Richardson Greenshields of Canada Ltd.[50] and Moldaver J. in Goodman v. Rossi, only the person receiving discovery knows for certain whether this information would be useful in another context; the owner of the information can only speculate about whether there is an intention by the receiving party to use the information for an ulterior purpose:[51]
 
Absent clairvoyancy, how is the producing party to know what extraneous purposes the receiving party may have in mind? How can the producing party satisfy the court that a restrictive order is necessary without knowing (a) what information the receiving party intends to use for an extraneous purpose; and (b) what that purpose may be?
 
Indeed, not knowing whether the opposing side intends to use disclosed information for an ulterior purpose, absent an implied undertaking the disclosing party would likely err on the side of caution by applying to the court for a confidentiality order under most circumstances. A default “no-confidentiality” rule therefore creates the risk of flooding the court system with applications for express undertakings of confidentiality.
 
Finally, in cases dealing with matters of public health or safety, the existence of an implied undertaking creates the potential of collusion between litigants. As described by one commentator, a situation could arise wherein critical information remains confidential:[52]
 
One party seeks to hide its misconduct or prevent the encouragement of other putative litigants. The opposing party, who could reveal the dangers, often has litigation interests other than obviating a potential risk to the public most commonly, securing an advantageous settlement and it will [forgo an application to remove the undertaking] as a bargaining chip.
 
The trial judge is thereby denied the opportunity to examine the information in question to decide whether or not it should be released to the public. On the other hand, if the law required a party seeking confidentiality to apply to the court for an express undertaking. the trial judge would have the opportunity to evaluate whether or not it was in the public interest for this information to be protected.
 
The foregoing discussion demonstrates that, contrary to what a survey of recent Canadian judgments would suggest, there is no obvious answer to the question of whether the implied undertaking should exist. From a theoretical standpoint, a scheme where the implied undertaking exists is more consistent with the general desire to minimize intrusions on privacy, especially where the information is court-compelled. However, that position seems inconsistent with the open courts principle, where the general rule is that material is public unless otherwise ordered. On the practical side, the analysis is similarly inconclusive. Good reasons exist for the absence of an implied undertaking, but they have been met with resistance, chiefly on the grounds that that increased documentary review and the need for court applications would result in higher costs. In the absence of empirical evidence it is difficult to identify the ideal solution.
 
It cannot be said, therefore, that the current state of the law is inappropriate. However, for the jurisdictions that have not yet legislated in this area, perhaps the solution lies in the adoption of a non-discretionary election rule.[53] Such a rule would provide that information obtained on discovery is not confidential, but that upon application by either party, the court “shall” impose an undertaking of confidentiality unless doing so would be inappropriate in the circumstances. This framework would mitigate the cost concerns described above; it would be consistent with the open courts principle; and in cases that have the potential for generating secretive collusion, it would give trial judges the opportunity to review the type of material in question before shielding it from the eyes of the public. The scope of the rule and potential exceptions to it are discussed further in Section 3.
 
2.         Duration of the Undertaking
If the undertaking attaches, either impliedly or expressly, the next question is how long it should last. A court can, if it deems just, relieve of the undertaking at any stage (the grounds for such relief are discussed in Section 2(3)). However, absent such an order, should the undertaking be of indeterminate duration, or should it expire when the information to which it pertains is introduced in open court? The majority of Canadian jurisdictions have taken the latter approach. On closer examination, however, that rule may not have the theoretical foundation that it requires.
 
The question of duration is the area in which there is the most divergence in Canada. It is also the area that has attracted the most debate in the United Kingdom.[54] The widespread disagreement arises because of a tension between, on the one hand, the desire to preserve confidentiality as much as possible, and on the other, the intuitive resistance to the anomaly of a situation where third parties can access the information but the party receiving it on discovery cannot. The first part of this section presents arguments on both sides of the debate; the second offers an evaluation.
 
There are three broad approaches to the question of duration: the technical approach, the open courts justification, and the incentives argument. Each is examined in turn.
 
(a)        Technical
Under the technical approach, there is a recognition that the undertaking is made to the court. As such, it can only be relieved by order of the court. Viewed in this light, the fact that the information to which it pertains has become public through its introduction in open proceedings is irrelevant to relief of that duty: the public that has access to and can make use of the information was never bound by the undertaking in the first place.
 
This approach has appeared in the case law. In Svhron Corporation v. Barclays Bank,[55] the court wrote that:[56]
 
It is necessary, in my judgment, to distinguish between the party on whom the undertaking is imposed on the one hand and third parties on the other hand. The undertaking binds the former, it does not bind the latter, who have given no undertaking.
            . . . . .
[T]he fact that the contents of a discovered document may have reached the public domain does not, in my judgment, per se relieve a party from the implied undertaking.
 
The problem with this formalistic approach is that it is circular: the existence of the undertaking is used as justification for its continuation. It ignores the fact that when evidence is adduced in open court, many of the practical reasons for preserving confidentiality, described in Section 2(1), no longer apply. For these reasons, technical considerations are accorded minimal weight in this analysis.
 
(b)        Open Courts
A more plausible approach to the question of duration, and indeed one that has captured much attention in the courts, is the open courts argument. The logic is that it is counterintuitive and inappropriate that a third party should have access to the information in question and not be subject to any restrictions in respect of its use, while the party that received it on discovery remains bound by the undertaking.
 
This reasoning has intuitive appeal. It appears consistent with the principle of public access to the courts that once information is revealed in a public hearing, and absent compelling grounds to the contrary, there should not be restrictions imposed on its transmission and use. Moreover, it seems unfair a person should be prevented from using information which the rest of the world has access to merely by virtue of his or her status as a party in the lawsuit. On closer examination, however, the argument loses much of its thrust.
 
First, the reasoning rests on the assumption that at least part of the purpose of the open courts principle is the transmission of private information into the hands of the public. In other words, it presupposes either that (a) the primary purpose of open courts is to publicize the affairs of public litigants, or that (b) regardless of what the purpose of open courts is, and even if that purpose could be achieved without public revelation of private information, the choice of publicizing private information would still be made.
 
That the open courts principle is not intended as an avenue for the transmission of private information into the hands of the public is clear. It is, rather, a method of ensuring the proper administration of justice.[57] As noted by the Federal Court in Lubrizol, “the public interest in open trials is not for titillation or satisfaction of curiosity but is to enable a member of the public to see that justice was properly administered”.[58]
 
Judicial scrutiny, however, cannot be achieved with at least some revelation of private information. As Lord Diplock stated in Harman:[59]
 
[A]lthough the reason for the [open courts] rule is to discipline the judiciary . . . the form that it takes, that justice is to be administered in open court where anyone present may listen to and report what was said, has inevitable side-effects that may not be conducive to the attainment of justice in the particular case, but which have to be accepted because of the general importance of maintaining the general rule.
 
Public revelation of private information, therefore, is the price that must be paid for the paramount objective of a publicly accountable adjudication system. The perceived unfairness arising from the differential treatment of the person receiving the information on discovery and the person hearing the information in open court is not a justification for pressing the invasion of privacy rights further than required by the objective of open courts.[60]
 
At first glance it may seem that, if the information in question is available to the general public, then the marginal invasion of privacy resulting from one extra person (the receiver) being permitted to use the information is trivial. However, the reality is that most often it is the very person receiving discovery that is in the position to inflict the most damage on the owner of the information, by virtue of that person’s pre-existing relationship with the opposing party. Moreover, practically speaking, the introduction in open court of a document is not tantamount to publicizing its contents. As was variously noted in Harman:
 
In the ordinary way the risk of publicity outside the court to the contents of documents read inside the court is small.[61]
There may be nobody present apart from the parties and their legal advisers[62]
The degree of publicity resulting from a document being read out in open court is not very great.[63]
 
The counterargument is that to be true to the principle of open courts, the law must rest on the assumption that any hearing may be exposed to the full glare of publicity.[64] That assumption is unrealistic; indeed, if as a matter of course the evidence in all trials were widely publicized, there would likely be strong incentives for modifying the open courts system.[65]
 
Therefore, although it seems logical that if courts are open, then the undertaking should be removed as soon as the information to which it pertains is adduced in open court, practical reality may dictate a different
approach.
 
(c)        Incentives
Two incentives arguments can be made in favour of preserving the existence of the undertaking beyond trial. The first is that if the undertaking expires when the pertinent information is adduced in open court, that encourages the party subject to the undertaking to introduce as much evidence as possible. The second is that if the undertaking does not survive beyond trial, the owner of the information in question would be more reluctant to make honest discovery.
 
In practice, neither argument carries much weight. It is unlikely that tactical maneuverings by the party subject to the undertaking would go unnoticed by the judge or opposing counsel and the court could easily regulate such behaviour. Moreover, it is difficult to see how the prospect of post-trial collateral use of information by the receiving party would provide any greater disincentive to honest discovery than is already generated by the requirement of having to provide one’s opponent with potentially damaging information to be used in the very lawsuit at hand.
 
In addition, incentives arguments generally suffer from the difficulty of determining with any degree of accuracy the magnitude of the incentive in question. Therefore, little weight should be accorded to the incentives arguments when evaluating an ideal scheme.
 
Having examined the various arguments regarding duration, the analysis turns now to an evaluation of whether there is an optimal approach to the issue.
 
(d)        Evaluation
At this juncture it is helpful to define clearly what it is that the undertaking attempts to protect. Practically speaking, there are two areas that fall within the concern of protecting litigants’ privacy and property rights. One is the worry that the information may be revealed to the public, causing embarrassment or revealing trade secrets (“public risk”); the other is that the information may be used by the party receiving discovery to inflict damage on the disclosing party through, for example, future litigation or misappropriation of trade secrets (“private risk”). When information is adduced in open court, public risk is no longer a consideration, for its potential damage can no longer be avoided. Simply because the party receiving discovery is barred from disclosing it to the public does not mean that the public will not receive the information. Indeed, where there is an expectation that “juicy” information (embarrassing or otherwise) will be revealed at trial, the media are certain to be present. Therefore, assuming that no reason exists to relieve from the undertaking before the information is adduced in open court, it follows logically that, insofar as duration of the undertaking is concerned, public risk is not a consideration; the analysis need only contemplate private risk. Indeed, the evaluation of the optimal duration must be determined based exclusively on concerns about the use that the party receiving discovery may make of the information in question. When viewed in this light, nothing has changed after the information has been adduced at trial that justifies adding to the injury of public risk by allowing private risk to materialize. Nothing has occurred that would permit the receiver of the information to use it for a collateral or ulterior purpose. The same rationales that justified the imposition of the undertaking – discussed in Section 2(1) – should continue to apply.
 
The fact that third parties have access to the information in question is irrelevant to this line of reasoning because, in keeping with the open courts principle, there is nothing that can be done to prevent those third parties from accessing the information. If the receiving party remains subject to the undertaking. however, the private risk inherent in disclosure is minimized. In other words, the fact that one of the two risks has materialized is not justification for allowing the other to do so as well if anything, it should prompt a desire to curb further injury to the disclosing party.
 
This reasoning does away with the complications raised by the arguments discussed above. It is consistent with the technical approach, it eliminates concerns of perverse incentives and it resolves, albeit theoretically, the anomaly of allowing third parties to use the information while simultaneously barring the receiver from doing the same.
 
At the risk of redundancy, it must be stressed that the fact that third parties have gained access to documents is irrelevant. The owner of the information could, at its discretion, reveal the information to a particular third party. Clearly that release would not authorize the party subject to the undertaking to use the confidential information outside the scope of the trial. The reasoning is no different where a third party acquires the information by sitting in a public hearing than it is where the third party acquires the information directly from its owner: such release should not authorize the party subject to the undertaking to make collateral use of the information.
 
Admittedly. in some cases it would be grossly inequitable to prevent the receiver of the information from using it while at the same time imposing no such restriction on the general public (e.g. when the information reveals a cause of action for which both members of the public and the receiver of the information would be potential plaintiffs). In such circumstances, relief from the undertaking can be assessed on a case-by-case basis. That is the subject of the next section.
 
3.         Release from the Implied Undertaking
Regardless of the default duration of the undertaking, it is always within the scope of the court’s equitable powers to relieve a party from its applicability. A breach of, or release from, an undertaking of confidentiality can damage the owner of the information in varying degrees, depending on the use that is made of the information in question. Similarly, removal of the undertaking may provide the party formerly subject to the undertaking, or third parties, with varying levels of benefit. A balancing of the relevant costs and benefits must therefore enter the determination of whether the undertaking should be released.
 
As is clear from the preceding discussion, relief from the undertaking can cause serious harm to the owner of the information, especially if the information contains trade secrets or is of an embarrassing nature. However, there are three circumstances where the case for release for the undertaking is particularly compelling: (a) where multiple similarly situated plaintiffs in different suits against the same defendant seek to share information; (b) where the confidential information reveals a risk to the public; and (c) where the confidential information discloses an independent actionable cause.
 
In the first case, relief from the undertaking may be appropriate because sharing of information would yield efficiency gains.[66] Through information sharing, similarly situated plaintiffs would be spared part of the large expense inherent in the discovery process. The corresponding damage to the defendant would be minimal because that party would have been required to disclose the confidential information to each plaintiff even if relief from the undertaking were not granted. Relief should, of course, extend only to the common plaintiffs. Each common plaintiff would still be bound by the undertaking against disclosure to third parties. As a precaution, sharing should be permitted only sparingly with parties who are merely contemplating litigation but have not yet commenced legal action.[67]
 
In the second scenario, the confidential information might disclose evidence of widespread fraud or a public health risk. Where this is the case, privacy concerns should yield to the public right to know. There is an expectation that the opposing party will bring the information to the court’s attention. The trial judge can then review it and determine whether public disclosure is warranted. Even in the event that one party does not petition the court on this issue, the trial judge may be given the discretion to make the order independently.
 
Finally, where the confidential information reveals an actionable cause, the proper administration of justice requires that a potential plaintiff he permitted to use that information to ground a lawsuit. Such an exception has been criticized primarily because of the perceived unfairness in compelling a party to reveal confidential information and then using that very information to harm the party. That criticism is weak. If a wrong has been committed, the culpable party should not be immune from accountability merely because it would, ideally, have kept its wrongdoing secret. This exception has also been criticized as resulting in perverse incentives.[68]
 
The harms and benefits of disclosure are bound to vary widely from case to case. It would be wrong to impose a blanket rule providing for removal of the undertaking in certain circumstances and not in others. Rather, it should be left to courts, on a case-by-case basis, to balance the potential harms and benefits of disclosure and determine whether relief is just.
 
IV.       RECOMMENDATION
it is recommended that the implied undertaking be addressed by the rules committees of every province where it has not yet been legislated. Where, as in this case, the common law has been inconsistent in its treatment of an issue, codification is appropriate. There is a benefit to nationwide uniformity and the provinces that have not yet legislated the rule may wish to consider adopting it in the same form as Rule 30.1 in Ontario, Manitoba and Prince Edward Island. However, as demonstrated by the preceding analysis, a different approach might be preferable.
 
The discussion in Section 2(1) suggests that it would be more consistent with the open courts principle if the undertaking did not attach by default since the general rule is that the onus falls on the party seeking to prevent disclosure to demonstrate why protection is necessary. Moreover, a default “no-confidentiality” rule would give trial judges the opportunity to review the type of material in question before shielding it from the eyes of the public, thereby mitigating the potential for collusion between litigants in matters relating to public health and safety. However, it is recognized that a default rule of this sort is bound to result in countless applications for express orders of confidentiality and, for this reason, it is recommended that if a “no-confidentiality” default is adopted, the rule should provide for a non-discretionary granting of confidentiality on motion by one of the parties.[69] In the absence of empirical evidence regarding the cost consequences of one scheme versus another, however, neither the “no-confidentiality” default nor the “undertaking” default can be said to be more appropriate.
 
Whereas there is not a clear optimal approach to the question of default undertaking applicability, other aspects of the rule must be considered more thoroughly before a rule identical to Rule 30.1 is adopted nationwide. Specifically, as demonstrated in Section 2(2), the prevalent approach to the question of duration may also be misguided. Once the undertaking attaches, it should be of indeterminate duration. The open courts principle does not justify relief from the undertaking merely by reason of the introduction of confidential information in open court.
 
The proposed rule should provide that where the undertaking is imposed, the trial court retains discretion to relieve from its application. The circumstances where use of that discretion may be appropriate were canvassed in Section 2(3). In essence, the rule should provide that:
 
  • Discovery is by default public, but a party may move for an imposition of an undertaking of confidentiality and the court shall grant such motion unless there are compelling reasons to the contrary.
  • If imposed, the undertaking is of indeterminate duration, and specifically the introduction of the underlying information in open court does not relieve from the applicability of the undertaking.
  • If the undertaking is imposed, the court retains the discretion to relieve the parties from its application if it so deems just.
 
These are, naturally, broad guidelines; the expertise of the rules committees is best suited to determining specifically how the rule should be worded.
 
V.        CONCLUSION
Discovery is essential to the truth-finding purpose of the judicial system but it constitutes a serious intrusion on the privacy and property rights of litigants. The implied undertaking arose as a means of balancing those rights with the benefits of information sharing. However, the doctrine developed inconsistently across jurisdictions and there remain significant differences in its application that raise the question of what the best solution is.
 
This article has attempted to identify the best approach by delving more deeply into the theoretical backing for the rule. It concludes that the approach taken in the provinces that have legislated Rule 30.1 is not incorrect but that a different type of rule may be more consistent with the theoretical underpinnings of the implied undertaking. Therefore, before adopting a scheme similar to Rule 30.1, the rules committees of the various provinces may wish to give the issue further consideration.
 
The area is ripe for further research. It would be interesting to consider the applicability of the undertaking to other forms of adjudication, such as administrative tribunals or arbitration hearings.[70] Another relevant topic, particularly with such wide divergence between jurisdictions and increases in interjurisdictional litigation, is the issue of conflict of laws: how should requests for discovery be treated when compliance would entail the disclosure of information received pursuant to discovery in a second jurisdiction where that information is subject to an undertaking of confidentiality in that second jurisdiction?[71] Finally, it would be useful to devise an empirical analysis to measure in what proportion of cases the existence or absence of an implied undertaking would actually have practical consequences.
 
Procedural rules exist to give effect to substantive rights.[72] The purpose of the undertaking is to protect the substantive rights of privacy and property. It does this well, but fine-tuning its scope with specific regard to the issues discussed in this article would help to make it more consistent with broader legal principles.




* This article was written while I was a student at the Faculty of Law, University of Toronto. I would like to thank Sean Boyle, Jacqueline Hughes and in particular Prof. Lorne Sossin for their comments and suggestions in the preparation of this paper.
[1] For a good review of the types of protection available for business information see John B. Laskin and Dan W. Puchniak. “Sealing Orders after Sierra Club” (2003), 27 Adv. Q. 173.
[2]Colortech Paintingand Decorating Ltd. v.Toh (2000), 276 A.R. 262 at para. 34, 9 C.P.C. (5th) 350, 2000 ABQB 814, citing Goodman v. Rossi (1995), 24 O.R. (3d) 359, 125 D.L.R. (4th) 613, 83 O.A.C. 38 (C.A.).
[3]Lac Minerals Ltd. v. Vancouver Stock Exchange (1985), 17 D.L.R. (4th) 687, [1985] 3 W.W.R. 436, 60 B.C.L.R. 183 (S.C.); Lac Minerals Ltd. v. New Cinch Uranium Ltd. (1985), 17 D.L.R. (4th) 745, 50 O.R. (2d) 260, 48 C.P.C. 199 (Ont. H.C.J.). Although the Ontario case recognized the existence of the implied undertaking, its correctness was debated in the Ontario courts until the decision in Goodman and subsequent codification in Rule 30.1.
[4] See Section II, infra.
[5]Kyuquot Logging Ltd. v. British Columbia Forest Products Ltd. (1986), 30 D.L.R. (4th) 65, 12 C.P.R. (3d) 347, [1986] 5 W.W.R. 481 (B.C.C.A.); Hunt v. T&N, plc [1995] 5 W.W.R. 518, [1995] B.C.J. No. 758 (QL), 96 W.A.C. 94 (C.A.).
[6] Goodman, supra, footnote 2.
[7] Ontario: Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 30.1; Manitoba: Queen’s Bench Rules, M.R. 553/88, r. 30.1; Prince Edward Island: Rules of Civil Procedure, r. 30.1.01.
[8] Arthur R. Miller, “Confidentiality, Protective Orders and Public Access to the Courts” (1991), 105 Harv. L. Rev. 428; Lawyers for Civil Justice Task Force, “Court-Approved Confidentiality Orders: A Critical Analysis of Their Need” (1990), 57 Def. Counsel J. 89; Kurt Putnam, “Your Trade Secret Is Safe With Us: How the Revision to Federal Rules of Civil Procedure Makes Discovery Presumptively Confidential” (2001-2002), 24 Hastings Comm. & Ent. L.J. 427; Laurie Kratky Doré, “The Confidentiality Debate”, Trial (October 2000), p. 18.
[9] The issue was last dealt with thoroughly in Canadian literature by John B. Laskin, “The Implied Undertaking in Ontario” (1990), 11 Adv. Q.298. Unfortunately, that article is generally restricted in scope to Ontario and has been superseded by legislative amendments and court rulings following its publication.
[10] Consider Laskin, ibid.;Ian Eagles. “Disclosure of Material Obtained on Discovery” (1984), 47 Mod. L. Rev. 284; and Karl Arvai, Implied Undertaking Rule – Protecting Litigants Against the Collateral Use of CompulsoryDisclosure (paper presented at the CBA/OBA National Civil Litigation Conference, March 2005).
[11] See also William G. Horton and Sunil Mathai, Confidentiality in Canadian Civil Litigation, Blake, Cassels & Graydon, LLP (January 26, 2004).
[12] U.K. Rules of the Supreme Court, Order 24, Rule 14A (in force October 1, 1987). Today, see Civil Procedure Rules, Part 31, Rule 31.22. For more detail, see Bibby Bulk Carriers Ltd. v. Cansulex Ltd., [1988] 2 All E.R. 820, [1989] Q.B. 155.
[13] Ibid.
[14] The practice of pre-trial oral discovery “examinations for discovery” – common in Canada and the United States generally does not exist in the United Kingdom.
[15]Goodman v. Rossi (1994), 21 O.R. (3d) 112, 120 D.L.R. (4th) 557,75 O.A.C. 331 (Gen. Div.). revd supra, footnote 2; Home Office v.Harman, [1983] 1 A.C. 280 (H.L.)(Harman).
[16] Fed. R. Civ. Pro. 26(c).
[17] Jack H. Friedenthal, “Secrecy in Civil Litigation: Discovery and Party Agreements” (2000), 9 J. L.& Pol’y 67 at p. 76.
[18] Kurt Putnam, “Your Trade Secret Is Safe With Us”, supra, footnote 8, at p.431. It has been argued that this application of Rule 26(c) is inconsistent with its wording: Friedenthal.
[19] Putnam, ibid., at p. 432.
[20]Seattle Times Co. v. Rhinehart, 467 U.S. 20, 104 S.Ct. 2199 (1984): “[W]here, as in this case, a protective order is entered on a showing of good cause as required by Rule 26(c), is limited to the context of pretrial civil discovery, and does not restrict the dissemination of the information if gained from other sources, it does not offend the First Amendment.”
[21] The Supreme Court of Canada has not pronounced on the implied undertaking rule in the common law context. A recent decision, on appeal from the Quebec Court of Appeal, confirmed that the existence of the implied undertaking of confidentiality was consistent with civil law principles: Lac d’Amiante du Québec Ltée v. 2858-0702 Québec Inc.,[2001] 2 S.C.R. 743, 14 C.P.C. (5th) 189, 2001 SCC 51. The civil regime is sufficiently distinguishable from that of the common law provinces that the decision is of limited value; however, the Supreme Court’s discussion of policy considerations could with little difficulty be transposed to the common law context. In other words, it is difficult to imagine the court taking a different approach to the problem if it were to consider the issue in one of the common law provinces.
[22]Supra, footnote 7. An interesting issue is whether, in those provinces, the implied undertaking rule has been abrogated by the introduction of the deemed undertaking rule. As noted by J.Scott Maidment, “You Might Like to Know ...“, The Advocates’ Brief, Vol. 7, No. 10 (July 1996), at pp. 14-15:
 
The deemed undertaking rule does not, on its face, purport to abolish the existing common law implied undertaking. More importantly, though the issue does not appear to have been addressed directly in any case to date, at least one decision of the Ontario Court of Justice (General Division) [T1T2 Limited Partnership v. Canada (Attorney General) (1996), 48 C.P.C. (3d) 84, 3 O.T.C. 127 (Gen. Div.)] suggests without expressly saying so – that the common law implied undertaking still exists independently of the deemed undertaking rule.
 
In TIT2 the evidence was not governed by the deemed undertaking, but the court nevertheless considered whether it was governed by the implied undertaking at common law. See also Goodyear r. Meloche (1996), 50 C.P.C. (3d) 398, 41 C.B.R. (3d) 112, 2 O.T.C. 174 (Gen. Div.).
[23] For bankruptcy proceedings, see Goodyear Canada Inc. v. Meloche, ibid.,for information obtained through the equitable jurisdiction of the court, see National Bank of Canada v. Mann (1999), 37 C.P.C. (4th) 88 at para. 23 (Ont. S.C.J. (Master)), supp. reasons 90 A.C.W.S. (3d) 848. 1999 CarswellOnt 2620.
[24] Rule 30.1.01(8).
[25] In family law, Saskatchewan Rule 588 also applies: Kim: v. Kim Estate (2004), 253 Sask. R. 307, 4 C.P.C. (6th) 146, 12004] Si. No. 632 (QL) (Q.B.).
[26] The traditional common law position is that breach constitutes contempt of court: Harman, supra, footnote 15; Carbone v. De La Rocha (1993), 13 O.R. (3d) 355 (Gen. Div.); Orfus Realty v. D.G. Jewellery of Canada Ltd. (1995), 24 O.R. (3d) 379, 83 O.A.C. 35, 41 C.P.C. (3d) 148 (C.A.); Sandbar Construction Ltd. v. Howon Industries Ltd. (1998) 58 B.C.L.R. (3d) 55; [1999] 5 W.W.R. 413. 26 C.P.C. (4th) 149 (S.C.). However, often the court will limit itself to enjoining against use of the information in question or staying an action that has been commenced based on information protected by the undertaking: Riddick v. Thames Board Mills Ltd., [1977] 3 All E.R. 677, [1977] 3 W.L.R. 63 (C.A.).
[27] British Columbia: Discovery Enterprises Inc. v. Ebco Industries Ltd. (1997), 42 B.C.L.R. (3d) 192, [1998] 5 W.W.R. 435, 15 C.P.C. (4th) 285 (S.C.) (Ebco);Alberta: Wirth Ltd. v. Acadia Pipe & Supply Corp. (1991), 79 Alta. L.R. (2d) 345, 113 A.R. 298, 50 C.P.C. (2d) 273 (Q.B.); Nova Scotia: Sezerman v. Youle (1996), l35 D.L.R. (4th) 266, 150 N.S.R. (2d) 161, 47 C.P.C. (3d) 137 (C.A.). As noted earlier, this is the same as the position taken by the majority of the House of Lords in Harman, supra, footnote 15. At the federal level, Lubrizol Corp. v.Imperial Oil Ltd. (1990), 33 C.P.R. (3d) 49, [1991] 1 F.C. 325, 39 F.T.R. 43 (T.D.) also found that the undertaking survived the introduction of the pertinent information in open court; however, without directly challenging the validity of that position. the court in Canada v. ICHI Canada Ltd. (1991), 40 C.P.R. (3d) 119, [1992] 1 F.C. 571, [1991] 2 C.T.C. 230 (F.C.T.D.) held that the undertaking did terminate in those circumstances. Subsequent cases have confirmed the latter position, again without making reference to Lubrizol: N.M. Paterson & Sons Ltd. v. St. Lawrence Seaway Management, [2002] F.C.J.No. 1713 (QL), 2002 FCT 1247 (F.C.T.D.) (Paterson); Agustawestland International Ltd. v. Canada (Minister of Public Works and Government Services), [2005] F.C.J. No. 809 (QL), 2005 FC655 (F.C.T.D.).
[28] Wirth, ibid.
[29]Supra, footnote 12.
[30]Ebco, supra, footnote 27, at paras. 33-36.
[31]Sezerman, supra, footnote 27: “1 find the rationale of the rule as stated by Lord Keith in Harman, supra,and Lord Denning M.R. in Riddick, supra, to be so compelling as to generate a reluctance to impose qualifications and limitations upon it.”
[32] At the time of this writing there was an action underway in British Columbia dealing with this issue.
[33] Ontario, Manitoba, Prince Edward Island, Alberta, Nova Scotia, Federal.
[34] Rule 30.1.01(2) (Ontario, Prince Edward Island); Rule 30.1(2) (Manitoba).
[35] Ontario Civil Practice Manual.
[36] Goodman v. Rossi, supra. footnote 15.
[37]Kirkbi AG v. Ritvik Holdings Inc. (2000), 10 C.P.R. (4th) 531, [2001] 1 F.C. 681, 196 F.T.R. 214 (F.C.T.D.); Paterson, supra, footnote 27.
[38]Ochitwa v. Bombino (1997), 153 D.L.R. (4th)555, [1998] 4 W.W.R. 535, 56 Alta. L.R. (3d) 37 (Q.B.).
[39] Sezerman, supra, footnote 27.
[40] The issue was expounded with characteristic clarity by McLachlin J.A. in Kyuquot, supra, footnote 5. This was picked up in Goodman, supra, footnote 2 and Goodman v. Rossi, supra,footnote 15.
[41] See, for instance, Lord Denning M.R. in Riddick, supra, footnote 26. Much of the U.S. discussion has revolved around this issue, because one of the big questions there related to discovery has been, to what extent do you allow the use of protective orders? To what extent does the public have a right to access the information that is used in a lawsuit? See also Miller, supra, footnote 8.
[42] See e.g. Miller, ibid., at p. 466.
[43] Consider Lord Denning M.R.’s statement in Riddick, supra, footnote 26:
 
Very often a party may disclose documents, such as inter-departmental memoranda, containing criticisms of other people or suggestions of negligence or misconduct. If these were permitted to found actions of libel, you would find that an order for discovery would be counter-productive. The interdepartmental memoranda would be lost or destroyed or said never to have existed.
 
[44] Miller, supra, footnote 8, at pp. 478-82, identifies some of the strongest arguments in this area.
[45] A potential problem is that these lawsuits might get settled, meaning that the media does not get access to the information at all.
[46] Miller, supra, footnote 8, at p. 477.
[47] Ironically, this could lead to the situation where a statement of claim making potentially damaging assertions is public, but the information that would negate those allegations is protected by the implied undertaking confidentiality. Admittedly, the problem is mitigated by the fact that the owner of the exculpatory information is free to reveal it publicly if it deems it necessary.
[48] Goodman v. Rossi, supra, footnote 15.
[49] Esson J.A. in Kyuquot, supra, footnote 5, makes some interesting remarks in this respect.
[50] Vancouver Registry No. C860975, [1987] B.C.J. No. 400 (QL) (B.C.S.C.).
[51]Goodman v. Rossi, supra, footnote 15, at p. 131.
[52] Miller, supra, footnote 8, at p. 477.
[53] Similar, for example, to Rule 26.01 of the Ontario Rules of Civil Procedure: “On motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.” (emphasis added).
[54]Harman, supra, footnote 15 going one way subsequently having been reversed by legislation.
[55] [1985] 1 Ch. 299.
[56]Ibid., at pp. 321 and 322.
[57] Scott v. Scott, [1913] A.C. 417 (H.L.).
[58] Lubrizol, supra, footnote 27, at para. 4.
[59]Harman, supra, footnote 15 at p. 303, per Lord Diplock.
[60] Perhaps the solution to the “unfairness” problem lies in reformulating the open courts principle such that limits are imposed on the uses to which third parties may put information gathered in open court. How such a scheme would operate is beyond the scope of this analysis.
[61]Harman v. Home Office, [1981] Q.B. 534 at p. 543.
[62] Harman, supra, footnote 15, per Lord Kinkel.
[63] Harman, ibid., per Lord Keith.
[64] Consider for example the argument of the appellant before the House of Lords in Harman, ibid.
[65] Supra, footnote 61.
[66] See also Fred Hagans, “Confidentiality Agreements and Orders: When Should Discoverable Materials be Kept Secret?” (1990), 31 S. Tex. L. Rev. 455 at pp. 462-63; Miller, supra, footnote 8, at pp. 497-99; Putnam, supra, footnote 18, at p. 432.
[67] As noted by Miller, ibid. at p. 499: “The risk of a fishing expedition or some other form of mischief is greatest in this context. The safest course seems to be denial of discovery sharing until the requesting party actually has begun a lawsuit, unless he demonstrates extraordinary need.”
[68] This exception has also been criticized as resulting in perverse incentives: supra, footnote 43.
[69] The “motion” could be reduced to a simple requirement of election. e.g. filing the appropriate form with the court at the commencement of an action. Note also that even if the undertaking is deemed to attach automatically, there is a compelling argument for making express undertakings of confidentiality available in certain circumstances (e.g. where there is an elevated risk of abuse of the implied undertaking): see R. Lee Buckler, “Expressing the Implied Undertaking Rule” (1998), 56 Advocate (Van.) 35; Laskin, supra, footnote 9; Arvai, supra, footnote 10.
[70] See, e.g., Arvai, ibid.
[71] See, e.g., Laskin, supra, footnote 9.
[72] Miller, supra, footnote 8, at p. 464.