Gault Estate (Re), 2016 ABQB 657

Court of Queen ’ s Bench of Alberta Citation: Gault Estate (Re), 2016 ABQB 657 Date: 20161122 Docket: 1401 09603 Registry: Calgary Between: James Emsley Thomas Hooton, as Litigation Representative of the Estate of Carol Mary Lascelles Gault Plaintiff/Defendant by Counterclaim - and - Sebastian Gault as Trustee for the Estate of Leslie Gault Defendant/Plaintiff by Counterclaim _______________________________________________________ Reasons for Case Management Ruling of the Honourable Mr. Justice Bryan E.

Mahoney _______________________________________________________ Introduction [ 1 ] This decision deals with two case management applications by the Leslie Gault Estate for orders compelling the production of financial records from off shore non-party corporations Geoffrey Colclough, Isis Fiduciary Corporation, First Names (Guernsey) Ltd.

and HSBC Holdings PLC. [ 2 ] The records sought in both applications are records of financial corporations located in London, England, and Bailiwick, Guernsey. The Leslie Gault Estate asks this Court to issue Letters of Request for the assistance of the judicial authorities of England and Guernsey to give effect to a production of documents Order from this Court. Background [ 3 ] On May 2, 1975, Carol Gault and Leslie Gault entered into a premarital agreement whereby each of them agreed to contribute to the marriage in proportion to their respective means. They were married on May 10, 1975.

Leslie Gault died in January 2014, Carol Gault died in 2015, and the litigation is now being pursued by their two estates. [ 4 ] On September 3, 2014, Carol Gault filed a Statement of Claim against Sebastian Gault, as Trustee for the Estate of Leslie Gault.

In the Claim, Carol Gault, who is now represented by her son, Thomas Hooton, as Litigation Representative for the Estate of Carol Gault, alleges that she over-contributed to the marriage relative to her proportionate means and that Leslie Gault was thereby unjustly enriched during their 38 year marriage. [ 5 ] Accordingly, it will be necessary at trial for the Court to determine the issue of respective means of each of Carol Gault and Leslie Gault throughout the course of their marriage.

The Records [ 6 ] The Leslie Gault Estate alleges that the records that are the subject of the applications pertain to some assets held by Carol Gault during her marriage to Leslie Gault.

The Leslie Gault Estate submits that these records are material to the overall analysis of whether Leslie Gault was unjustly enriched by Carol Gault’s household contributions as alleged by the Carol Gault Estate. [ 7 ] The Leslie Gault Estate argues that it anticipates that these records may inform the quantification of Carol Gault’s assets which is relevant for the purpose of determining whether an unjust enrichment case is made out. [ 8 ] The Carol Gault Estate wants the application dismissed because: (

a) the procedure sought is a mere fishing expedition not permitted by law; (

b) the Carol Gault Estate has produced voluminous documents covering Carol Gault’s investments and holdings; and (

c) the document request is out of all proportion to the costs, delay and hardship such an order would entail given the existing documentary evidence as to the minor money amounts in these accounts and the lack of evidence to support the relevancy and materiality of this loose, vague and unfocussed record search. Decision [ 9 ] Both applications are denied. [ 10 ] The general principle is that the English Court ordinarily will give effect to requests from foreign courts so far as is proper and practicable and to the extent that is permissible under English law.

Discovery in England is much narrower than what is allowed in Alberta. According to Steven Loble, “Guide to Obtaining Evidence in England for Use in Proceedings in the United States of America”, online: ˂ http://www.loble.co.uk/depositions.html˃ Discovery in England and Wales (which is documentary only) is much narrower than the discovery which is allowed in the U.S.: English Courts will not countenance “fishing expeditions”.

The English Court is prohibited from making an order requiring any particular steps to be taken unless they are steps which could be taken to obtain evidence for the purposes of civil proceedings in the English Court. The English rules distinguish between (

i) evidence in the nature of proof to be used for the purposes of the trial and (ii) evidence in the nature of pre-trial discovery to be used for purposes of a train of enquiry which might produce evidence for trial. The English Court will not execute Letters of Request issued for the purpose of obtaining pre-trial discovery of documents and will not give effect to a request for those purposes. [ 11 ] In a case comparing the law of England with that of the United States, the English Court of Appeal stated in State of Minnesota v Philip Morris Incorporated and Others , [1998] I.L.Pr. 170 at para 13 and 14.

The difficulty in the present case, as in previous cases, arises because of the difference in approach to discovery in this country and the United States. Their discovery procedures are not necessarily the same in all States. But in general in the United States there is a tradition of oral discovery which has never been developed in this country. Rightly or wrongly, we regard oral discovery as a form of discovery which generates unnecessary costs and complexity. There is another difference between the approach to discovery in this country and that in the United States.

Generally, there it is possible to get much wider “non party” discovery. That is discovery against those who are not parties to the proceedings. This is a matter which was alluded to in passages from the speech of Lord Diplock (also by other members of the House), in Re Westinghouse at page 635. Those passages read as follows: “... The Request for the production of documentary evidence by the two RTZ companies must not only satisfy the requirements of subsection (3) which exclude fishing discovery, but also the stricter requirements of subsection (4). Under the procedure of the High

Court of England there is no power to order discovery of documents by a person not a party to the action, but such a person can berequired by subpoena duces tecum to produce documents to the court or, where his evidence is taken before an examiner prior to the trial,at such examination.” [12] Similarly, the Supreme Court of Canada said in R v Zingre (SCC), [1981] 2 SCR 392: The interests of sovereignty have come into conflict with the principle of judicial comity in a number of situations and Canadian courtshave refused to order the testimony of the individual for use in the foreign proceedings: … (ii) when discovery was sought against anindividual not a party to the litigation, in violation of local laws of civil procedure… (iii) when the main purpose of the examination wasto serve as a “fishing expedition”, a procedure not allowed in English or Canadian courts. ...

It is sometimes said that an order for examination will never be issued if the testimony is to be used as part of a pre-trial or investigatoryprocedure. This rule has been applied in large

part in civil proceedings in which American courts have sought the assistance of Canadianauthorities in the discovery process.

It should be remembered that American rules relating to discovery are much broader than those inCanada and this in part may explain the reluctance of Canadian courts to enforce letters rogatory in these instances. ... [13] In Richter Gedeon Vegyeszeti Gyar RT v Merck & Co (1995), 185 NR 88, the Federal Court of Appeal held at para 22: Reduced to essentials, the appellants’ position is that subsection 462(4) of the Rules invests the Court with a discretion to order oralexaminations for discovery of non-residents; but they recognize the Court will only make such an order where it is likely that it will beeffective. [14] This Court will make the type of order the applicant seeks only if it is likely that the order will be effective and the foreigncourt can and will execute the order.

I have no evidence and no authority before me that the procedure in the foreign courts in eitherapplication would permit the kind of relief the applicant seeks here. The authorities referred to above lead me to conclude not only thatthe orders sought here are a form of “fishing” for documents, but that seeking their enforcement in the foreign court is likely to be futile. [15] Costs can be spoken to at the next case management hearing. Heard on the 30th day of September, 2016. Dated at the City of Calgary, Alberta this 22nd day of November, 2016. Bryan E. Mahoney J.C.Q.B.A. Appearances: Daniel J.

McDonald, Q.C. and Joanne Luu Burnet, Duckworth & Palmer LLP for the Plaintiff/Defendant by Counterclaim Ariel Z. Breitman, Jonathan J. Bourchier and Sarah Louw MacPherson Leslie & Tyerman LLP for the Defendant/Plaintiff by Counterclaim