Failure to produce relevant documents can have consequences for the party withholding those documents. If a need later arises to rely on unproduced documents, “” may be required to allow their late production. That ruling is far from automatic.
between Premform Limited, defendant Heights Rental 鶹ýion Inc. and third party Teskey Concrete Company Corp. is illustrative.
Premform claimed labour, material and administrative costs incurred arising from the removal, re-forming and re-casting of concrete material caused by an alleged defect in the concrete ready-mix supplied by third party Teskey Concrete. Premform was required, “to disclose in its affidavit of documents every document relevant to any matter in issue that is or has been in its possession, control or power.”
The bid estimate was viewed as relevant since it contained productivity estimates for Premform’s labour on each floor of the building correlated to productivity rates per square foot and hourly labour cost amounts. This information would allow an assessment of both the alleged “corresponding delay” and Premform’s alleged inability to complete its work on schedule.
However, Premform not only failed to disclose its project bid estimate among its affidavit of documents but also refused to produce it during its examination for discovery. Then, after examinations for discovery were complete, “Premform produced an expert report in support of its loss of productivity claim, which relied on the bid estimate in calculating damages and appended it.”
Third party to the dispute, Teskey Concrete Company Corp., felt that failure to disclose the estimate, a document relevant to the dispute, was a deliberate strategy. Both Teskey and Heights Rental argued if leave was granted by the court to allow late production of the estimate, they should be granted “costs thrown away from the prior examinations of Premform and an opportunity to conduct further examination based on the bid estimate.”
Premform argued the estimate was not viewed as relevant and contained confidential bid and pricing information. However Associate Justice Todd Robinson was clear.
“Put simply, Premform made a conscious decision not to produce a document that I have found ought to have been produced.”
“Ultimately, the court granted leave, determining that a fair disposition of the matter was to allow Premform to rely on the document, but ordered that Premform produce its representative for a further examination for discovery at Premform’s own expense,” , partner with Fasken Martineau DuMoulin LLP, associate and articling student told the Daily Commercial News.
Robinson noted such rulings are “discretionary” and far from assured. Nevertheless, in this case, he ruled the delayed disclosure impacted Teskey’s conduct of its litigation to date and overall litigation strategy.
“I agree that impact does constitute some prejudice to Teskey (and Heights Rental), but it is compensable.”
Robinson also noted that although “costs are discretionary,” he ordered Premform to reimburse Teskey and Heights Rentals for their reasonable costs of the further examination on a full indemnity basis, altogether not an insignificant expense for Premform.
“Document disclosure is undeniably one of the most important aspects of litigation,” said Lynde, Stonehouse and Muresan.
Furthermore, disclosure upholds the principle of avoiding what , partner with Miller Thomson LLP, and associate , as “a trial by ambush” when relevant documents are withheld.
“Parties must be aware of the fact that any documents referenced in an expert report may be deemed relevant by the court even if the document was not relevant at the time of disclosure and production,” said Lynde, Stonehouse and Muresan.
However, they added although document disclosure may not necessarily be the priority and “top-of-mind consideration” when commencing a proceeding, neither is it merely a “side-issue” in litigation.
“Rather, document disclosure remains a core consideration that all parties must seriously consider both before deciding to commence litigation as well as during litigation itself. A failure to do so can potentially have unintended, commercially embarrassing, and costly consequences.”
John Bleasby is a freelance writer. Send comments and Legal Notes column ideas to editor@dailycommercialnews.com.
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