The risk of self-incrimination in cross-border disputes: The use of Canadian discovery evidence in U.S. criminal/regulatory proceedings – Part I

A common scenario in which the privilege against self-incrimination is threatened occurs when a person is party to criminal or regulatory proceedings in the United States (U.S.) and civil litigation in Canada.

In the leading case of Gillis v. Eagleson, [1995] OJ No. 1160, the defendant lawyer brought a motion for a temporary stay of an Ontario civil action against him, pending the final determination of U.S. criminal proceedings and Law Society of Upper Canada disciplinary proceedings in which the same allegations were raised. He claimed that the Ontario action would prejudice him in the criminal and disciplinary proceedings. The plaintiff was a former hockey player, who had suffered a career ending injury and alleged that his former lawyer had engaged in deceit, breach of contract, and breach of fiduciary duty arising out of the settlement of his insurance claim relating to the injury.

The Court applied the test in Stickney v. Trusz, a pre-Charter case, which held that where there are parallel civil and criminal proceedings in Canada, a stay should only be granted in exceptional and extraordinary circumstances if the accused's right to a fair trial will be prejudiced in a manner specific and peculiar to that party. That prejudice is to be balanced against the right of the plaintiff to have a conclusion to his or her litigation.

The Court found that there was uncontroverted expert evidence that the defendant would not receive Charter protection in the U.S. criminal proceedings and that he would not have the ability to invoke the U.S. Constitution's Fifth Amendment to prevent any discovery or trial evidence given in Ontario from being used against him in the U.S. criminal trial. The Court concluded that there was no procedure in Ontario that would be effective to stop the evidence from being used in the U.S. – a sealing order might not be honoured by a U.S. court. Further, it would be “anomalous to deprive a Canadian resident of the protections he would have been afforded if he had been charged in Canada in respect of conduct committed in part in Canada against a Canadian resident.” As a result, the motion for a temporary stay was granted.

This case has become the high watermark for protection in Canada against the risk of the loss of the privilege against self-incrimination in the U.S., likely due to its unique facts. In particular, in subsequent cases, the expert evidence has been conflicting with the result that the defendant cannot establish more than the potential for prejudice.