The Insurer’s ‘liberal’ approach to document production opened the door to wider waiver of privilege in Pacific Sands Beach Resort v. Co-Operators General Insurance Company, 2025 BCSC 858. 

Owners of the Pacific Sands Beach Resort in Tofino, BC, sought coverage for damage to the property and the resort in the course of construction.  When their claim for coverage was denied, the Plaintiffs filed an action against their insurer for breach of an insurance policy and breach of the duty of good faith in handling the coverage claim.

During the litigation, the Defendant insurer — prompted in part by the Plaintiffs’ persistence — served several amended lists of documents, with repeated disputes over claims of privilege.

In October 2023, in an effort to resolve one such dispute, the defendant served a “Revised 4th Amended List of Documents,” moving 454 documents from Part 4 (privileged) to Part 1 (may be used at trial), and explicitly waiving privilege over them. The accompanying letter described the production as a “liberal approach” intended to demonstrate the insurer’s good faith in adjusting the claim.

Later, in November 2023, the defendant served a “Further Revised 4th Amended List of Documents,” still claiming privilege over 588 documents. 

The Plaintiffs sought production of the remaining Part 4 documents, the former counsel’s full file, and certain missing attachments to produced emails. In Chambers, the central issue was whether the defendant had waived solicitor/client privilege over the documents sought. 

Position of the Parties 

The Defendant acknowledged intentional waiver for the 454 documents but maintained privilege over the rest. They argued that disclosure was voluntary to avoid prolonged production disputes and did not extend to unrelated documents. They denied that legal advice had been relied upon enough to justify a broader waiver.

The Plaintiffs argued that the explicit waiver over the 454 documents, combined with the insurer’s stated purpose of rebutting bad faith allegations, meant privilege was waived over all other documents on the same subject matter — namely, their claim for coverage. Selective disclosure was unfair and could create a misleading record. Relying on Examination for Discovery of the Defendant’s representative, the Plaintiff also argued the insurer relied on legal advice in its defence, triggering an implied waiver.

Court’s Decision

The Court outlined the distinction between explicit and implicit waiver before finding that the insurer had implicitly waived solicitor–client privilege over all coverage-related documents.

Explicit Waiver of privilege may be established where it is shown that the possessor of the privilege:  a) knew of the existence of the privilege; and b) voluntarily evinced an intention to waive that privilege[1]

Implicit Waiver of privilege may be found without a voluntary intention to waive where the holder of the privilege conducts themselves in such a way, or takes a position in relation to privileged materials that would be inconsistent with maintaining the privilege, and it would be unfair to allow the privilege to subsist. Thus, waiver of privilege as to part of the communication will be held to be a waiver as to the entire communication.

Here, by producing 454 pages of privileged coverage-related material while withholding others on the same subject, the Defendant waived privilege over all such documents. Fairness and consistency required disclosure of the remainder.

The court relied on four key factors: (1) counsel for the insurer said the disclosure was to address bad faith allegations; (2) the documents were moved to the 'trial use' section of the List of Documents; (3) a sample of documents showed relevance to the insurer’s conduct; and (4) discovery testimony confirmed that legal advice factored into the insurer’s decision[2].

Key Takeaways 

• Solicitor–client privilege, is “nearly impenetrable” except in narrow, well-defined circumstances. Once waived — explicitly or implicitly — the waiver may be broad
• Selective disclosure of privileged materials on a topic may compel disclosure of all other documents on that subject to prevent an unfair or misleading narrative. Fairness and consistency are the policy drivers for extending the waiver
• Reliance on legal advice as part of a defence can trigger an implied waiver, especially in bad-faith insurance claims where the state of mind is at issue 
• Waiver is subject-matter specific — only documents on the same topic as the waiver must be disclosed
• Once privileged material is intentionally disclosed, it is difficult to control the scope of resulting production obligations. Parties should carefully consider the strategic implications before waiving privilege, even partially

[1] Barbieri v. White, 2024 BCCA 225, at paragraph 49; Soprema Inc. v. Wolrige Mahon LLP, 2016 BCCA 471, at paras. 48/49.

[2] United States v. Meng, 2020 BCSC 1461