Implied Undertaking Rule Inapplicable In Context Of Independent Medical Examination

Unifund Assurance Company v Churchill, 2016 NLCA 73

In this case, the Newfoundland & Labrador Court of Appeal considered the scope of the implied undertaking rule in circumstance involving an independent medical examination.

Background Churchill, who was injured in a motor vehicle accident, commenced a tort claim against the other driver. He also claimed, and initially received, wage-indemnity benefits from his automobile insurer, Unifund. When these benefits were later terminated, Churchill sued Unifund for breach of contract. By that time, the tort action had settled.

Unifund served Churchill with Interrogatories as permitted by Rule 31. The interrogatories included the following question:

Have you submitted to any independent medical examinations in connection with the tort claim [against the other driver], arising out of the motor vehicle accident of December 13, 2010, and/or Canada Pension Plan Disability and/or pension/disability providers? If so, when and with whom?

Rule 31.03(2) provides that "An objection to answering any interrogatory may only be taken on the ground of privilege or that it is not relevant". Churchill declined to answer the question "based on relevancy, litigation privilege and the implied undertaking rule".

The principles underlying the implied undertaking rule were set forth by the Supreme Court of Canada in Juman v. Doucette, 2008 SCC 8. This rule provides that evidence compelled during pretrial discovery from a party to civil litigation is not to be used by the other parties except for the purpose of that litigation, unless the scope of the undertaking is varied by judicial order, or in the event that a situation of immediate and serious danger emerges.

Unifund applied to compel Churchill's reply and sought production of any independent medical examination ("IME") reports identified. The applications judge held that the contemplated IME reports would be relevant and not protected by litigation privilege. However, the implied undertaking rule applied relieving Churchill from any obligation to answer the question or produce any IME reports, the use of which was deemed to be "strictly confined" to the tort litigation.

Decision On appeal, the Court held that any IME reports prepared since the accident would be relevant to Unifund's defence because Churchill's claim was premised on the allegation that he had been continuously disabled as a result of, and since, the accident.

Litigation privilege was held to be...