SCARS LEFT BEHIND
When victims suffer
combined physical and
psychiatric impairments

DONALEE MOULTON

A Canadian taxpayer who unknowingly invested in a Ponzi scheme run by now convicted fraudster Andrew Lech is walking away with $1.3 million.

“It’s one of the few cases I’m
aware of—perhaps the only
one— where the person is bet-
ter off after the fraud. The shoe
is on the other foot,” said John
Loukidelis, a partner with
SimpsonWigle Law LLP in
Hamilton, Ont.

Lech had been recommended to the Peterborough, Ont. woman by a friend. Lech had also grown up in the same area.

The woman, Donna Johnson, has emerged victorious from the Tax Court of Canada, which has ruled — to the chagrin of the Canada Revenue Agency—that her unwitting windfall is not taxable.

In Canada, for money to be
considered taxable income, it
must come from a source such as
a business or property, explained
Ryan Morris, a partner with
McMillan LLP in Toronto. “It is
not enough to merely have an
accretion of wealth. For example,
gifts, inheritances, and gambling
winnings are common items of
wealth accretion that are not sub-
ject to tax because there is no
source of income.”

IMMIGRATION

Privacy poachers take big hit See Money Page 8 THE LAWYERS WEEKLY Vol. 22, No. 27 NEWS FOR THE LEGAL PROFESSION December 6, 2002

PAGE 9

CRISTIN SCHMITZ

The Ontario Court of Appeal’s creation of a potentially sweeping new tort for invasion of privacy will generate litigation and other revenue opportunities for a broad cross section of the Bar, lawyers predict.

The new U.S.-style common law cause of action, dubbed “intrusion upon seclusion” by the appeal court in its groundbreak-ing Jan. 18 judgment in Jones v. Tsige, now offers recourse against “highly offensive” online or other intrusions into “matters such as one’s financial or health records, sexual practices and orientation, employment, diary or private correspondence,” according to the decision.

But the contours of the tort, as outlined by Justice Robert Sharpe for the appeal panel, are considerably broader than that.

The novel cause of action now
presents the prospect of non-
pecuniary, pecuniary, and puni-
tive damages, as well as injunc-
tive relief, against those who,
“without lawful justification,”
deliberately or recklessly intrude
physically or otherwise on the
plaintiff’s seclusion or the plain-
tiff’s “private affairs or concerns,”
in a manner that “a reasonable
person would regard as highly
offensive, causing distress,
humiliation or anguish.”
Based on the track record of
privacy actions in Canada, the
United States and Britain, com-
mentators told The Lawyers
Weekly the judgment’s wording
arguably could encompass a
broad array of intrusions on pri-
vacy in the personal, commer-
cial and governmental spheres.
These could include, for
example:
n;A landlord spying on a tenant;
n;Private investigators tracking
people;
n;People accessing their spouses’
or children’s correspondence,
diaries, e-mail, Facebook,
banking or health information
without permission;
n;Employers surreptitiously
monitoring employees via com-
puter or other means;
n;Abusive telemarketing or junk-
faxing, or collection agencies
making harassing telephone calls;
n;Businesses or other organiza-
tions misusing, or recklessly
failing to protect, sensitive confi-
dential personal information;
n;Paparazzi-type behaviour, such
as the News International celeb-
rity phone hacking scandal, which
is costing Rupert Murdoch’s
media empire millions of dollars
in settlements and legal fees.

“Those are just some of the areas,” said Christopher Du Vernet of Du Vernet Stewart in Mississauga, Ont. “I think the case has enormous potential, and technology is going to drive this in new and greater directions because there are so many new ways of intruding upon seclusion — physical and informational and otherwise … the sky is the limit.”

At the Court of Appeal, Du Vernet successfully represented Sandra Jones, whose lawsuit against Winnie Tsige for snooping online through Jones’s private banking records had been thrown out summarily last year by a judge who said inventing a new tort was a job for legislators.

A new tort for invasion of privacy will effect lawyers in a wide range of fields, says Christopher Du Vernet, who won the case in question. He is seen at his Mississauga, Ont. office.

PAUL LAWRENCE FOR THE LAWYERS WEEKLY

See Tort Page 27

THE LAWYERS WEEKLY
THE LAWYERS WEEKLY
VOL. 22, NO. 27 NEWS FOR THE LEGAL PROFESSION DECEMBER 6, 2002
VOL. 22, NO. 27 NEWS FOR THE LEGAL PROFESSION DECEMBER 6, 2002
The Canada Border
Services Agency’s
most unwanted list

PAGE 15

ETIQUETTE
Minding your
office manners

PAGE 21

GATHERING DATA
The tangled web
of ownership

PAGE 24

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