Criminal Law Notebook

Settlement Privilege

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This page was last substantively updated or reviewed January 2016. (Rev. # 94160)

General Principles

Settlement privilege (or negotiation privilege) is a class privilege designed to promote settlement.[1] It creates a prima facie presumption of inadmissibility.[2] Any information disclosed under settlement privilege cannot subsequently be used against the accused.[3] Exceptions include where the information is used "to rebut an allegation of prejudice at the hands of the Crown."[4]

Purpose

The privilege is intended to "promote settlement" by wrapping a "protective veil" around their efforts to settle by ensuring the communications are inadmissible.[5] The parties need the ability to have "full and frank discourse" in order for agreements to take place. Without protection, these discussions may not otherwise take place.[6]

The privilege protects the public interest in favouring settlement. It "promotes the interests of litigants generally by saving them the expense of trial."[7]

The disclosure of "without prejudice" communications has a tendency to promote litigation.[8]

Application

The privilege applies where the following criteria are established:[9]

  1. A litigious dispute must be in existence or within contemplation.
  2. The communication must be made with the express or implied intention that it would not be disclosed to the court in the event negotiations failed.
  3. The purpose of the communication must be to attempt to effect a settlement.

Where settlement fails the privilege is invoked and the communications cannot be used in the course of litigation.[10] However, if a settlement is successful, the communications may be used to prove the existence of a settlement contract.[11]

Courthouse hallway discussions concerning offers to settle and related discussions are prima facie privileged."[12]

Discussions of possible admissions by defence counsel are protected by privilege.[13]

Waiver

The privilege is possessed by both parties to the litigation and cannot be unilaterally waived by one party.[14]

Without Prejudice Terms

The "without prejudice" common law rule renders communications "made in the course of ... negotiations" in admissible.[15] This rule has been extended beyond simply documents and communications.[16]

The use of the term "without prejudice" alone is not determinative of whether settlement privilege applies.[17]

Use in Abuse of Process Motions

Settlement privilege applies to resolution discussions and is prima facie inadmissible on an abuse of process motion.[18]

Exception

There is a broad exception to settlement privilege in cases where "justice ... requires it."[19] The issue in excluding the privilege is whether there is "a competing public interest outweighs the public interest in encouraging settlement."[20]

  1. ↑ Sable Offshore Energy Inc v Ameron International Corp, 2013 SCC 37 (CanLII), [2013] 2 SCR 623, per Abella J, at para 12
    R v Delchev, 2015 ONCA 381 (CanLII), 325 CCC (3d) 447, per Tulloch JA, at para 24
  2. ↑ Sable, ibid., at para 12
    Delchev, ibid., at para 24
  3. ↑ R v Zarinchang, 2010 ONCA 286 (CanLII), [2010] OJ No 1548, per curiam, at para 28
    R v Bernardo, [1994] OJ No 1718 (ONSC)(*no CanLII links) , at para 16
  4. ↑ Zarinchang, supra, at para 28
    Bernardo, supra
  5. ↑ Sable Offshore Energy, supra, at para 2 ("The purpose of settlement privilege is to promote settlement. The privilege wraps a protective veil around the efforts parties make to settle their disputes by ensuring that communications made in the course of these negotiations are inadmissible.")
  6. ↑ R v Pabani, 1994 CanLII 8723 (ON CA), 89 CCC (3d) 437, per Finlayson JA
  7. ↑ Kelvin Energy Ltd. v Lee, 1992 CanLII 38 (SCC), [1992] 3 SCR 235, per L'Heureux‑Dubé J, at para 48
    Sable Offshore Energy, supra, at para 11
  8. ↑ Pirie v Wyld (1886), 11 OR 422, [1886] OJ No 188 (Ont. H.C.)(*no CanLII links) , per Cameron CJ, at para 18 (“... letters written or communications made without prejudice, or offers made for the sake of buying peace, or to effect a compromise, are inadmissible in evidence. It seemingly being considered against public policy as having a tendency to promote litigation, and to prevent amicable settlements.”)
  9. ↑ Calgary (City) v Costello, 1997 ABCA 281 (CanLII), 160 WAC 1, per Picard JA, at para 60
    Delchev, supra, at para 24
    Meyers v Dunphy, 2007 NLCA 1 (CanLII), 38 CPC (6th) 265, per Wells CJ, at para 6 John Sopinka, Sidney N. Lederman & Alan W. Bryant, The Law of Evidence in Canada, 3rd ed. (Markham: LexisNexis Canada Inc, 2009) at para 14.322
  10. ↑ Hansraj v Ao, 2002 ABQB 385 (CanLII), 314 AR 262, per Slatter J, at para 13
    Sable, supra at para 17 ("the protection is for settlement negotiations, whether or not a settlement is reached. That means that successful negotiations are entitled to no less protection than ones that yield no settlement")
  11. ↑ Hansraj v Ao, ibid., at para 13
  12. ↑ Delchev, ibid.
  13. ↑ R v Lake, [1997] OJ No 5447 (Ont. Gen. Div)(*no CanLII links) , at paras 41 to 52
  14. ↑ Hansraj v Ao, ibid., at para 13
    R v Delchev, 2012 ONSC 2094 (CanLII), [2012] OJ No 3963, per Low J, at para 19
  15. ↑ Sable, supra, at para 13
  16. ↑ Sable, supra, at para 14
  17. ↑ TDL Group Ltd. v Zabco Holdings Inc et al, 2008 MBQB 86 (CanLII), 7 WWR 659, per Joyal J, at para 30
    Flegel Construction Ltd. v Cambac Financial Projects Ltd, 1983 CanLII 1019 (AB QB), 3 WWR 405, per Veit J
    Sable, supra, at para 14
  18. ↑ Delchev, supra, at para 27
  19. ↑ Sable Offshore Energy, supra, at para 12
  20. ↑ Sable, supra, at para 19

Exceptions

Possible exceptions to settlement privilege include:[1]

  1. Whether without prejudice communications have resulted in a concluded compromise agreement;
  2. To show that an agreement apparently concluded between the parties during the negotiations should be set aside on the ground of misrepresentation, fraud or undue influence;
  3. Where a clear statement made by one party to negotiations, and on which the other party is intended to act and does in fact act, may be admissible as giving rise to an estoppel;
  4. If the exclusion of the evidence would act as a cloak for perjury, blackmail or other unambiguous impropriety, but such an exception should only be applied in the clearest cases of abuse of a privileged occasion;
  5. In order to explain delay or apparent acquiescence in responding to an application to strike out a proceeding for want of prosecution but use of the letters is to be limited to the fact that such letters have been written and the dates at which they were written;
  6. Whether the claimant had acted reasonably to mitigate his loss in his conduct and conclusion of negotiations for the compromise of proceedings brought by him; and
  7. Where an offer is expressly made “without prejudice except as to costs”.
  1. ↑ Meyers v Dunphy, 2007 NLCA 1 (CanLII), 38 CPC (6th) 265, per Wells CJ

Plea Negotiations

Communications regarding plea negotiations fall under the category of "public interest privilege" and so cannot be used in court. This includes negotiations regarding bail hearing[1] as well as sentencing hearings.[2]

This privilege exists to permit "frank and full discussions between counsel for the accused and counsel for the Crown." [3]

This kind of privilege cannot be waived by one party alone.[4]

It is prudent to set "terms of engagement in advance of negotiations" so the documents and reports provided to the other side pursuant to settlement negotiations will not be used for any other purpose.[5]

  1. ↑ R v Bernard, 2002 ABQB 747 (CanLII), [2002] AJ No 1007 (Alta. Q.B.), per Veit J
  2. ↑ R v Roberts, 2001 ABQB 520 (CanLII), [2001] AJ No 772 (Alta. Q.B.), per Martin J
  3. ↑ R v Bernardo, [1994] OJ No 1718, (Ont. Gen. Div.)(*no CanLII links) , at para 16
    R v Delorme, 2005 NWTSC 34 (CanLII), [2005] NWTJ No 51 (N.W.T. S.C.), per Vertes J, at para 18
    Roberts, supra, at para 60
    R v Griffin, 2009 ABQB 696 (CanLII), [2009] AJ No 1455 (Alta. Q.B.), per Greckol J, at para 65
  4. ↑ Bernard, supra, at para 39
    Griffin, supra, at para 54
  5. ↑ Griffin, supra – Doctors letter disclosed to crown was used in a production order. The report was found to be privileged, invalidating the ITO

See Also

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