Lawyers in association get confidentiality reprieve

Lawyers who work in association with each other can’t be assumed to be sharing confidential client information, according to a Superior Court master.

In Jajj v. 100337 Canada Ltd., the defendant, citing confidentiality, sought to remove Kenneth Alexander as the plaintiff’s counsel. The defendant had previously consulted with a lawyer who works in association with Alexander and, it suggested, it can be assumed that the two had discussed the information.

The case, according to Master Benjamin Glustein, presented “a novel legal issue.”

While the Supreme Court made it clear in MacDonald Estate v. Martin in 1990 that lawyers who work in a law firm can be assumed to be sharing information, Glustein said there was no jurisprudence on what to do when lawyers work in separate practices but share office space and support staff.

“Consequently, I deal with this issue as a matter of first instance,” he wrote in his Sept. 20 reasons for decision that dismissed the defendants’ motion.

Unless lawyers work for the same law firm, their clients can’t assume they share confidential information, Glustein found. “Even if two lawyers in an association share an assistant, receptionist, or bookkeeper or meet socially in the office from time to time, there ought to be no presumption that the assistant, receptionist, or bookkeeper transmit confidential information, or that it is discussed on social occasions,” he wrote.

“If a common assistant or bookkeeper worked a few days each week for two lawyers with separate practices in separate locations, or if two lawyers with separate practices were friends but did not share premises, there would be no such presumption of disclosure either through work or socially. That analysis ought not to change simply because lawyers with separate practices share premises.”

Previous cases in Canada have in fact dealt with the issue, says Heenan Blaikie LLP partner Simon Chester, who says the central issue is what constitutes a law firm and what protocols are in place to keep information secret.

“I think the live issue, which this case explores, is what’s a law firm,” says Chester.

For lawyers who work in association, “Master Glustein says, quite rightly, that there’s no presumption that the lawyers will function as a law firm and share confidence,” he adds.

Glustein’s analysis is consistent with the way the British Columbia Court of Appeal dealt with the issue in Baumgartner v. Baumgartner in 1995, Chester notes.

According to Glustein, lawyers who work together in a law firm are a part of its overall resources and can be presumed to share information while those who work separately have a legal obligation to keep their clients’ information private.

The evidence showed Kevin Fox, the lawyer Alexander worked in association with at Davenport Law Group, never discussed the issues raised by the defendant with him, Glustein noted.

Ben Hanuka, principal at Law Works Professional Corp., says that although the master arrived at the right conclusion by looking at the evidence, his overall decision “sets a dangerous precedent.”

The master is “drawing a broad stroke” when he says sharing support staff wouldn’t lead to presumption of shared information, according to Hanuka. In this case, the lawyers used the same letterhead and shared an e-mail domain, Hanuka says, noting doing so can give clients the impression they are in fact a part of the same law firm.

“They’re telling the whole world they’re part of Davenport Law Group. The client has no way of knowing that they’re separate practices. For them, it’s one law firm.”

Sharing a bookkeeper and an e-mail domain administrator also means there could be sharing of some information, including transaction details, says Hanuka.

But for Glustein, “a reasonably informed person” wouldn’t expect lawyers in associations to share files. “If the lawyers work in separate practices, with separate bank accounts and separate conflict search systems, a reasonably informed person would not expect those lawyers to discuss files with each other — in fact, the opposite expectation should apply,” he wrote. “To require lawyers with separate practices to implement common conflict search systems would be contrary to the professional confidentiality and non-disclosure obligations to which they are bound.”

Julia Holland, counsel at Torys LLP, agrees with the master. “I think the master was correct to reject the presumption that lawyers with separate practices who work in association discuss their files with one another,” she says. “The presumption that applies in a law firm setting should not be extended to lawyers working in association. We should, and I believe we can, trust lawyers to take their obligations of confidentiality seriously.”

In his ruling, Glustein said lawyers with separate practices in an association are bound by s. 2.03(1) of the Rules of Professional Conduct that forbids them from disclosing anything about their clients to another lawyer in the association.

For his part, Alexander says the decision “makes sense given the kind of case it is. It is a continuum, really, so on one end you have separate practices and separate offices. On the other, you have partnership in the same office. We have a bit of hybrid but clearly separate practices.”

He notes the clients in the matter knew he and Fox worked separately and says they have separate accountants and bookkeepers.

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