Badesha v. Haider, 2017 ONSC 1745

This refusals motion concerned a plaintiff’s request for the statutory third party’s file contents, including the defendant’s first statement to his liability insurer and all correspondence between the defendant and his liability insurer.  TD, the statutory third party (when the motion was heard), refused production on the basis of litigation privilege.  The plaintiff’s motion was defeated.

The motor vehicle accident giving rise to this motion occurred on March 2, 2009.  The defendant gave a statement to his insurer on March 4, 2009.  The plaintiff’s Statement of Claim was issued February 2, 2011.  The defendant signed a written statement on September 2, 2011.  TD took an off-coverage position and added itself as statutory third party on June 25, 2015.

In seeking production of TD’s file contents, the plaintiff argued that since TD had taken an off-coverage position and was no longer defending the defendant, any privilege that may have existed over its investigation had been extinguished.  TD argued the privilege was not waived and belonged to the defendant and TD.

Trimble J. began his analysis by re-iterating the fact that the party claiming privilege has the onus of justifying its claim.  Once the prima facie claim has been made, the party seeking production has the onus of justifying production.[i]  In this case, the party claiming privilege was TD.

Trimble J. then listed the “…principles of law that apply to privilege attaching to documents in a third party liability insurer’s file” as laid down in Panetta v. Retrocom Mid Market Real Estate:[ii]

  1. In order for a document to be protected from disclosure by litigation privilege it must be prepared with the dominant purpose of defending a claim against the insured.
  2. In circumstances where the document is created by the wrongdoer before a claim is made, privilege may well attach where the claim is anticipated from the outset [emphasis is original].
  3. Where the document is created by a third party liability insurer before a claim is made, it is reasonable from the moment the accident occurs that a claim will ensue [emphasis is original].
  4. The party claiming the privilege does not have to demonstrate a connection between the creation of the document and the activities of the “adversarial advocate.” Rather, the document must be created for the dominant purpose of use in litigation existing, contemplated or anticipated.
  5. Whether litigation privilege attaches to a document or class of documents is a fact specific inquiry.
  6. In an action defended by an insured under a third party liability file, potions of the file created for investigation, assessment, settlement before a claim and defence are all points along a continuum created with a view to adjusting a claim by the claimant against the insured.

In response to the plaintiff’s submission that TD’s privilege ended when it took an off-coverage position, Trimble J. relied on s. 258 of the Insurance Act, which gives an insurer rights and obligation as if it were the insured.  He also held the privilege “…extends to the insurer’s file because the insured cedes control of the action under the terms of the insurance contract.”


[i] Kennedy v. McKenzie, 2005 CarswellOnt 2109 (S.C.J.) at para. 23

[ii] Panetta v. Retrocom Mid Market Real Estate, 2013 ONSC 2386 (S.C.J.)