S.C.C. Establishes Lower Court Guidelines

On April 26, 2002, the Supreme Court of Canada released an important decision that establishes guidelines for lower courts issuing confidentiality orders for the protection of commercial interests in civil proceedings. The decision arises out of ongoing litigation among Atomic Energy of Canada Limited (AECL), Sierra Club of Canada and several federal ministers relating to the environmental assessment of nuclear reactors that are under construction by AECL in China.

AECL sought a confidentiality order with respect to certain technical environmental assessment documents belonging to the Chinese government, citing competitive and security concerns. Sierra opposed, arguing that public interest legal proceedings engaging issues of public law and public right should be entirely open, particularly when the environmental assessment of nuclear reactors is at stake. The S.C.C. reversed the court decisions below and granted AECL the confidentiality order with costs throughout to AECL. The court found that without the order, AECL would have been unable to mount certain defences in the ongoing litigation, having committed to the Chinese government that it would not use the documents in court proceedings without a confidentiality order.

While the S.C.C. emphasized the fundamental importance of open court proceedings, it concluded that in the circumstances of this case AECL’s right to a fair trial and full defence trumped any freedom of expression concerns, particularly in light of the small number of highly technical documents involved and the desirability of having this important case decided on the basis of all relevant information.

AECL was represented by Brett Ledger, Peter Chapin and Allan Coleman of Osler, Hoskin & Harcourt LLP; and in-house by Allan Hawryluk, general counsel and corporate secretary. The ministers were represented by Graham Garton and J. Sanderson Graham of the Department of Justice Canada. Timothy Howard of Sierra Legal Defence Fund in Vancouver, and Franklin Gertler in Montreal acted for Sierra Club of Canada.