OSC and province propose changes to protect whistleblowers

OSC and province propose changes to protect whistleblowers
Rebecca Wise of Torys LLP says she’s noticed a spike in the number of whistleblower-type investigations.

Ontario is seeking further comment on aspects of its Whistleblower Program, including a proposed revision to clarify that in-house counsel who report misconduct in breach of law society rules won’t be entitled to cash awards.

Last week, two potential amendments to Ontario’s Whistleblower Program were introduced by the province and the Ontario Securities Commission.

The government said it intends to introduce a civil cause of action for whistleblowers who experience reprisal for co-operating with the commission.

The introduction of a civil cause of action for reprisal is a welcome change to Ontario’s Whistleblower Program, says Nadia Campion, partner at Polley Faith LLP in Toronto.

“It gives teeth to the prohibition on employers from taking action that would adversely affect an employee who co-operates with the OSC,” she says.

It also brings Ontario’s Whistleblower Program in line with protections available to whistleblowers in the United States under the Dodd-Frank Act and the Sarbanes-Oxley Act 2002.

“As we know, the American Whistleblower Program has been relatively successful in ensuring that whistleblowers feel protected from reprisal and, therefore, are more inclined to report or disclose misconduct,” she says.

The change will also incentivize employers to ensure that they have strong whistleblower policies in place and that supervisors and managers are trained with respect to dealing with whistleblowers. 

“It also serves to raise awareness for employees that they should not be fearful of doing the right thing, which is to report misconduct first through internal channels and then if necessary to the OSC. Indeed, I think that the change will encourage employees to first use internal reporting systems before going direct to the OSC. This, in my view, is advantageous to organizations,” she says.

The OSC also proposed on Jan. 18 revisions to the Whistleblower Program to clarify that in-house counsel who report misconduct in breach of applicable law society rules would not be eligible for a whistleblower award. It is seeking comments on the proposal from now until March 20.

“To the extent the law society raised concerns, it’s not entirely surprising there would be a push to clarify it,” says Rebecca Wise, lawyer with Torys LLP in Toronto. “My sense is, and I think the OSC’s request for comment made it clear, that the intention was never that individuals acting in their legal capacity could be eligible for whistleblower awards. This is really just clarification of that, simply because the starting proposal was that lawyers acting in a legal capacity wouldn’t have been eligible in any event.”

The changes highlight the fact that in-house counsel have to “walk a very fine line” between reporting misconduct and ensuring that they are complying with their duties as lawyers, such as maintaining solicitor-client privilege, says Campion.

She adds that by making in-house counsel ineligible for a whistleblower award in circumstances where their disclosure or reporting to the OSC would otherwise violate applicable law society rules, the OSC is ensuring that in-house counsel undertake “a careful analysis of, and reflect on, their role within the organization and whether they are acting in a legal capacity with respect to matters they are contemplating reporting.”

“This represents a positive step towards ensuring that clients can continue to consult with and seek advice from their in-house counsel without fear that in doing so they are subjecting themselves to a possible whistleblower report,” she says. “It also protects against the possibility that individuals may be motivated to report in order to secure a financial gain notwithstanding the duties they owe as lawyers to their clients.”   

The Ontario Securities Commission launched its Whistleblower Program in July 2016 and many companies revised policies and came out with their own programs.

Wise says she frequently advises clients on internal whistleblower investigations and that since the adoption of the OSC’s program she’s noticed a spike in the number of whistleblower-type investigations.

“I think there is more of a whistleblower culture in some companies where employees are being encouraged to come forward and companies are taking complaints they receive very seriously and conducting good investigations into them,” she says.

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LGBTQ group for broader legal community launching this week

An LGBTQ social organization for people working in the broader legal community is holding its first event this Friday in Toronto.

Ontario Crown attorney Eadit Rokach, who co-founded the group Wildfire — “Lighting up LGBTQ+legal culture” — with court clerk Laila Azizi, says she’s hoping the event gets enough interest to lead to a next event, probably in May.

“We haven’t booked [the events] yet, but what we’re trying to do is have four a year,” she says. “One per season is the goal and for each event we will have a different beneficiary of our donations.”

At this first event there will be guest speakers along with hors d’oeuvres and a photo booth. Rokach says she’s also planned to have, and be one of, six “animators” who are in charge of inviting people and getting the conversation flowing.

“It’s a social organization that brings people together while raising funds [and] one that brings all people within the legal profession together,” she says. “We really want to bring as many people together from the legal community in hopes to have [them] get to know each other and cross boundaries.”

Rokach says that while there are legal organizations, there aren’t ones like Wildfire that focus on the LGBTQ+ community for lawyers, police officers, court clerks, reporters and court officers.

“We thought it would be a good way to get people together because in the legal community there is definitely an LGBTQ+ presence, but there’s not something that brings everyone together.”

The event takes place at Stori Aperitivo Bar and tickets are $20. Part of the proceeds will be donated to Egale Canada Human Rights Trust, an organization that works to improve the lives of LGBTQ+ people in Canada. Helen Kennedy, executive director of Egale Canada, and Ontario Court Justice Harvey Brownstone are the guest speakers for the evening.

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SCC decision helps those who want public interest standing at tribunals

SCC decision helps those who want public interest standing at tribunals
Aaron Dantowitz says a recent ruling gives guidance on issue of public interest standing before administrative decision-makers.

A decision by the Supreme Court of Canada reflects a trend toward expanding the circumstances where tribunals will grant public interest standing to people who don’t have a direct private interest in the matter, according to a Toronto lawyer.

The SCC ruling in Delta Air Lines Inc. v. Lukács is noteworthy to lawyers who practise administrative law because the decision could be used to persuade tribunals to have a more flexible approach in who is granted standing in their proceedings.

“It’s going to be a benefit for those who want to have more access on a public interest basis to tribunal hearings,” says Christopher Wirth, partner at Keel Cottrelle LLP. 

Wirth says the decision reflects a “growing trend” toward expanding the circumstances when someone can obtain public interest standing before a tribunal.

In the case, a Manitoba mathematician, Gábor Lukács, became engaged in a legal battle with Delta Airlines over policies related to obese passengers.

After Lukács — who is not obese — filed a complaint with the Canadian Transportation Agency alleging the airlines’ policies were discriminatory and violated Air Transportation Regulations, the complaint was dismissed, and Lukács could not obtain private or public interest standing.

However, the Federal Court of Appeal ruled that “a strict application of the law of standing as applied in courts was inconsistent with the Agency’s enabling legislation.”

The SCC also stated the agency “did not reasonably exercise its discretion to dismiss [Lukács’s] complaint” and did not use a “flexible approach” in determining who could obtain public interest standing.

“[T]he Agency presumed public interest standing is available and then applied a test that can never be met. Any valid complaint against an air carrier would impugn the terms and conditions established by a private company. Such a complaint can never, by its very nature, be a challenge to the constitutionality of legislation or the illegality of administrative action,” said the ruling.

The SCC also concluded that “the total denial of public interest standing is inconsistent with a reasonable interpretation of the Agency’s legislative scheme.”

“Applying the tests for private and public interest standing in the way the Agency did would preclude any public interest group or representative group from ever having standing before the Agency, regardless of the content of its complaint,” said the ruling.

“In effect, only a person who is herself targeted by the impugned policy could bring a complaint. This is contrary to the scheme of the Act.”

For these two reasons, the SCC sent the matter back to the agency to reconsider whether to grant Lukács public standing. However, Wirth says, “they sent it back telling the agency how to properly approach the analysis in making that decision.

“A fair underlying reading of the decision would suggest that the court is providing the agency with guidance that it needs to be more open and be prepared to consider granting public interest to someone in these circumstances,” he says.

Wirth says the decision will provide an even stronger basis for those seeking to expand the circumstances when a person or group can obtain public interest standing.

“What the court has said here is agencies, which are public bodies, shouldn’t strictly take . . . the test that the civil courts have adopted in determining whether or not to grant standing in civil proceedings and, instead, must take a flexible and discretionary approach in determining whether in the particular circumstances it’s appropriate to grant public interest standing to someone seeking it when they don’t have a direct private interest in the matter,” he says.

Aaron Dantowitz, partner at Stockwoods LLP, says the ruling gives important guidance on the issue of achieving standing before administrative decision-makers.

“Mainly, [it says] that the decision-maker has to make sure that the way that it determines standing takes into account the legislative scheme that it operates in, and it’s not necessarily going to be appropriate to use the same tests for standing that have been developed by courts for court proceedings,” says Dantowitz.

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Legal news roundup – Jan. 19, 2018

Canada

Shoppers Drug Mart signs marijuana supply deal with Tilray Canada, Globe and Mail

Man charged in deaths of Selim Esen and Andrew Kinsman will appear in court Friday, Toronto Star

Two men killed, two hospitalized in north Toronto shooting, Globe and Mail

United States

Government shutdown looms as Senate Democrats dig in against GOP spending plan, Washington Post

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Master refuses to bar Ontario lawyer from personal injury case

A master of the Ontario Superior Court has refused to remove defence counsel for an alleged conflict of interest in an unusual personal injury case.

In McCoy v. Loveday, Toronto lawyer Joel McCoy, the plaintiff in the case, tried to have lawyer Harvey Klein barred as acting as defence counsel because of conversations he had with other lawyers at Klein’s firm, Benson Percival Brown LLP.

The underlying action was against the driver of a vehicle in a 2014 accident that allegedly left McCoy with serious injuries. McCoy and his firm have been retained to represent other plaintiffs in a separate action arising out of the same accident.

McCoy had a number of conversations with lawyers at Klein’s firm, including one who had worked directly under Klein, about the companion action before filing his own statement of claim.

In an affidavit, McCoy claimed he was “provided with legal insight” pertaining to issues he discussed with one of the lawyers. In more than three conversations, he said the two discussed the circumstances, facts and legalities around his case.

They also talked about the liability of the defendant and issues concerning the threshold in his case, as well as details of treatment and findings of assessment.

McCoy said that in conversations with a second lawyer, who was employed with Klein’s firm at the time, he discussed the facts pertaining to liability, his injuries and the guilt of the defendant. He claimed that the second lawyer “provided her opinion pertaining to the defendant’s negligence.”

McCoy argued that these conversations gave lawyers at Klein’s firm direct knowledge of his case and that this put Klein in direct conflict in the matter, as well as that of the other injured parties.

Master Donald Short, however, found that such informal conversations at such an early stage did not warrant Klein being removed from the case.

“In my view, if there was any possibility of a misunderstanding, Mr. McCoy owed a duty to his colleagues in the defence bar to make clear that the discussions could lead to his seeking to have their firm disqualified from acting in the matter being discussed,” Short wrote in the decision.

“The plaintiff clearly was generally aware of the personal injury defence retainers of the lawyers with whom he will initiate conversations as in many cases they were acting for insured defendants opposite to him at examinations for discovery or mediations.”

Short found that discussions about the threshold for serious injuries in such accidents would only result in Klein being removed if a potential solicitor-client relationship had been articulated, which it hadn’t. Short said that McCoy was never a client of the lawyers he spoke to and had volunteered the information without indicating he was creating a solicitor-client relationship.

The master also determined that no one had forced McCoy to disclose information and that he was clearly aware of the defence retainers of the lawyers he spoke to.

“Applying proportionality [regarding] the prejudice suffered by a regular client being denied its counsel of choice is greater than the alleged prejudice suffered by the plaintiff,” Short wrote.

Short ordered McCoy to pay partial indemnity costs of $5,000 to the defendant’s counsel.

Neither McCoy nor Klein immediately responded to requests for comment.

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