Michael Ross
Associate
Document Dumps May Cost You
A recent decision from the Ontario Superior Court of Justice, Gowing Contractors Ltd v. Walsh Construction Company Canada, 2023 ONSC 4407, confirms there will be cost consequences to parties whose productions contain a significant proportion of irrelevant records. On a motion for further and better production, the Court considered, inter alia, whether the defendant Walsh had failed to meet its discovery obligations by producing an “astounding 25%” of irrelevant documents.
By way of background, the overall litigation relates to an infrastructure construction project. Walsh was the general contractor, Gowing was Walsh’s mechanical subcontractor, and Zurich Insurance Company Ltd. (“Zurich”) was Gowing’s bonding company. Initially, Walsh, Gowing and Zurich were represented by Ms. Bogach, Mr. Hammond and Mr. Yehia, respectively. Ultimately, Mr. Hammond withdrew and Mr. Yehia was retained to also act for Gowing.
At a prior trial management conference in March 2021, the motions judge ordered the parties to agree on a discovery plan to deal with all issues of electronic production, including identifying the custodians and search protocols to be applied to identify relevant documents. While they had difficulty agreeing on the scope of production (Ms. Bogach had suggested a “detailed discovery plan”, while Mr. Hammond preferred a “broad scope of relevance”), the parties – including Zurich – agreed to a discovery plan. However, it was vague regarding the scope of production – requiring relevant documents (as defined by the pleadings) to be produced, without specifying search terms or a list of custodians.
Gowing then produced approximately 140,000 records, while Walsh produced over 1 million records. At a subsequent trial management conference in October, 2022, no counsel, including Mr. Yehia, complained of non-compliance with previous directions regarding discovery and production.
In January, 2023 Mr. Yehia was retained as counsel for Gowing and immediately wrote to Ms. Bogach criticizing Walsh’s production of numerous irrelevant documents. Ms. Bogach responded that Walsh had chosen an “error bias in favour of inclusion”. Mr. Yehia retained a lawyer specializing in e-discovery to examine the productions, who identified some 270,000 irrelevant documents, which the motions judge described as “an astounding 25% of the total Walsh production to date.”
Considering the issue of overproduction of irrelevant documents, the court held:
[29] While there will always be some small level of irrelevant documentation in a large production set, such a large amount of irrelevant document production is egregious. It is the primary function of the producing party to do the work of deciphering what documents in its power, possession and control are relevant, and to produce them with an affidavit of documents [citations omitted]. That is the requirement of Rule 30.02(1). This is all of course subject to the principle of proportionality. In my view, Walsh clearly breached that obligation. That this happened suggests at minimum that Walsh failed to apply proper search protocols.
[30] Ms. Bogach argued that it was the vague and unfocused discovery plan the parties agreed to on June 8, 2021 that caused Walsh to err in favour of inclusion. She also argued that, with the productions being electronic, Zurich and Gowing could weed out the irrelevant documents with their own searches. I was indeed not pleased to read the discovery plan the parties agreed to. It did not have the lists of custodians to be searched and the search terms to be applied by both sides, as I had ordered on March 29, 2021. This does not, however, in my view, detract from the primary obligation of the producing party to decipher and produce only relevant documents. I find that Walsh has not met this obligation.
The court ordered Walsh to pay Gowing and Zurich $52,886 in costs thrown away and to produce a further and better affidavit of documents, omitting irrelevant documents. The court noted that Gowing and Zurich had recently produced a list of custodians and search terms used. The court ordered Walsh to do the same – a list of custodians and search terms applied to date, and to be applied in future to meet its discovery obligations.
While there will always be some small level of irrelevant documents produced in the course of complex litigation, in meeting their discovery obligations in accordance with Rule 30.02, parties need to make concerted efforts to remove irrelevant documents from their production set. As in this case, failure to do so can result in significant cost consequences.
