Canada (Attorney General) v. Al Jabri

Canada (Attorney General) v. Al Jabri
Court (s) Database
Federal Court Decisions
Date
2023-01-10
Neutral citation
2023 FC 40
File numbers
DES-5-22
Decision Content
Date: 20230110
Docket: DES-5-22
Citation: 2023 FC 40
Ottawa, Ontario, January 10, 2023
PRESENT: The Honourable Madam Justice Kane
BETWEEN:
ATTORNEY GENERAL OF CANADA
Applicant
and
SAAD KHALID S AL JABRI
Respondent
and
SAKAB SAUDI HOLDING COMPANY, ALPHA STAR AVIATION SERVICES COMPANY, ENMA AL ARED REAL ESTATE INVESTMENT AND DEVELOPMENT COMPANY, KAFA'AT BUSINESS SOLUTIONS COMPANY, SECURITY CONTROL COMPANY, ARMOUR SECURITY INDUSTRIAL MANUFACTURING COMPANY, SAUDI TECHNOLOGY & SECURITY COMPREHENSIVE CONTROL COMPANY, TECHNOLOGY CONTROL COMPANY, NEW DAWN CONTRACTING COMPANY and SKY PRIME INVESTMENT COMPANY
Respondents (moving parties)
ORDER AND REASONS
[1] Sakab Saudi Holding Company and the other corporate respondents [Sakab], bring this motion in the context of the Attorney General of Canada’s [AGC] Notice of Application (as amended) pursuant to section 38.04 of the Canada Evidence Act, RSC, 1985, c C-5 [CEA] [the Section 38 Application]. The AGC’s Section 38 Application seeks to protect sensitive or potentially injurious information, as those terms are described in the CEA, from disclosure in a proceeding.
[2] The underlying proceeding is an action by Sakab in the Ontario Superior Court of Justice, launched in January 2021, which seeks damages (of now over $5 billion) from Saad Al Jabri [Al Jabri]. Sakab alleges that Al Jabri orchestrated a massive international fraud and misappropriated funds from Sakab and the other corporate respondents, which were established to pursue counterterrorism activities for the Kingdom of Saudi Arabia [KSA]. Al Jabri is described as a former Director and Security Advisor to the Minister of the Interior of the KSA and as responsible for the oversight of the Sakab companies. Al Jabri was appointed as Minister of State and to the Council of Ministers, but was relieved of his governmental duties in 2015. After continuing to serve as a member of the KSA Government in an informal capacity, Al Jabri relocated to Canada in 2017.
[3] Sakab alleges that, among other things, Al Jabri amassed funds, purchased properties in various countries, established offshore companies to hold property, and made gifts to his children as part of a fraudulent scheme against his former employers, including the KSA Government and its rulers. Sakab alleges that the majority of Al Jabri’s misappropriation of assets occurred after he was relieved of his duties. Al Jabri responds that the funds and property, albeit of significant amounts, were compensation, profit shares, or bonuses for his services and for the risks he faced in providing such services. Al Jabri contends that some of the information that he will rely on to defend the fraud action cannot be disclosed because it is sensitive or potentially injurious information as those terms are defined in the CEA.
[4] The issue on the AGC’s Section 38 Application will be whether the prohibition to disclose the sensitive or injurious information to be identified by the AGC in the documents at issue (pursuant to three notices provided to the AGC in accordance with subsections 38.01(1) and (3) of the CEA), as provided for in paragraph 38.02(1)(a), should be confirmed by this Court pursuant to subsection 38.06(3), or whether disclosure should be authorized, in full or part or subject to certain conditions, pursuant to subsections 38.06(1) or (2).
[5] The next steps in the Section 38 Application cannot proceed until the issues raised in the current motion by Sakab [the Sakab motion] are determined. The Sakab motion challenges whether the document provided pursuant to the Second and Third Notices to the AGC, described as a “solicitor’s brief” or “proffer,” for which Al Jabri asserts litigation privilege, can be the subject of a section 38 application. The motion also challenges whether Sakab should receive the proffer, once redacted—despite that litigation privilege is asserted by Al Jabri and despite that the proffer has not been filed in the context of the underlying litigation and is not required to be filed—in order for Sakab to make submissions about its relevance or irrelevance to this Court. Sakab argues that Al Jabri’s conduct amounts to an abuse of process and that unless the redacted proffer is provided to them, the process will be unfair.
[6] For the reasons that follow, the Sakab motion is dismissed. The Court notes that the AGC has not yet completed the review of the proffer. Many of Sakab’s allegations are based on speculation. The Court does not agree that the process to date is unfair to Sakab or that Sakab cannot meaningfully participate in the section 38 determination. As explained below, in the context of determining the Section 38 Application, if the redacted information is relevant to issues in the underlying litigation, the Court will consider whether and how non-injurious summaries of any redacted information can be provided to Sakab or whether and how any injurious information should be disclosed to the trier of fact on appropriate terms and conditions in order for the trier of fact to determine the issues in the underlying litigation with the benefit of this information.
[7] Before setting out the issues in the Sakab motion and the parties’ respective submissions, a general description of the relevant statutory provisions and the process, along with the chronology of steps taken to date in this Court is provided for context. This Order and Reasons includes more background information and longer summaries of the parties’ arguments than typically necessary given the extensive submissions received by the Court and the parties’ references to information that may also be considered in the ultimate determination of the Section 38 Application.
[8] Both Sakab and Al Jabri characterize the proceedings in the Ontario Superior Court of Justice and in the United States [US] Federal District Court (Massachusetts) in different ways. This Court’s references to the respondents’ accounts of those proceedings do not reflect any findings of fact or interpretation of the other courts’ decisions; these are simply provided for context.
I. Section 38 [9] Sections 38 to 38.15 (collectively section 38) of the CEA set out a procedure whereby information relating to international relations, national defence and national security may be protected from disclosure before a court, person, or body with the jurisdiction to compel the production of information. [The relevant provisions are attached as Annex 1.]
[10] Where information is otherwise required to be disclosed by a participant, or is about to be disclosed, or may be disclosed in connection with a proceeding and that participant, or other person, believes that the information relates to international relations, national defence or national security (i.e. is sensitive or injurious), that person must give notice to the AGC (section 38.01). The AGC, upon review of the information, may authorize disclosure of all or part of the information (section 38.03). However, where the AGC does not authorize disclosure or does not enter into an agreement to permit disclosure of some facts or information subject to conditions (section 38.031), the AGC may apply to the Federal Court for an order confirming the prohibition on disclosure (section 38.04).
[11] The Court must then determine whether the prohibition on disclosure should be confirmed pursuant to subsection 38.06(3); or whether the information, or parts of it, should be disclosed pursuant to subsection 38.06(1); or, alternatively, whether the information or parts of it should be disclosed subject to conditions to limit any injury to international relations, national defence, or national security pursuant to subsection 38.06(2). The jurisprudence has established that the Court has several options to permit some disclosure, where necessary, on terms and conditions to mitigate any injury, including, for example, providing non-injurious summaries of the information or providing the information at issue only to the judge presiding at the underlying proceeding.
[12] The test to be applied by the Court in determining the Section 38 Application was established by the Federal Court of Appeal in Canada (Attorney General) v Ribic, 2003 FCA 246 [Ribic].
[13] In Canada (Attorney General) v Khawaja, 2007 FCA 388 [Khawaja FCA] at para 8, the Federal Court of Appeal reiterated the three-part test in the form of questions:
(a) Is the information in question relevant to the proceeding in which disclosure is sought? If no, the information should not be disclosed. If yes, then,
(b) Will disclosure of the information in question be injurious to national security, national defence, or international relations? If no, the information should be disclosed. If yes, then,
(c) Does the public interest in disclosure of the information in question outweigh the public interest in prohibiting disclosure of the information in question? If yes, then the information should be disclosed. If no, then the information should not be disclosed.
[14] The party seeking the disclosure of the information (generally the respondent) must demonstrate that the redacted information is relevant (Ribic at para 17). If relevance to an issue or issues in the underlying proceeding is demonstrated, the onus then shifts to the AGC to demonstrate that injury would result from disclosure of the information (Ribic at para 20). If both relevance and injury are established, the party seeking disclosure must then demonstrate that the public interest in disclosure of this information is greater than (i.e., outweighs) the public interest in the non-disclosure (i.e., protection) of the injurious information (Ribic at para 21).
[15] As noted by Justice Mosley in Canada (Attorney General) v Almaki et al, 2010 FC 1106 at para 60: “[t]he threshold for determining relevance is low. The Court must consider the relevance of the information at issue to the underlying proceeding.”
[16] In Canada (Attorney General) v Tursunbayev, 2021 FC 719 at paras 82–86 [Tursunbayev], Justice Noël emphasized that the Court must ensure that the redactions proposed by the AGC are justified and supported by evidence that injury from disclosure of the redacted information is probable, not simply possible. Although a degree of deference is owed to the AGC’s assessment of injury given their expertise and access to the information, the Court must still ensure that injury would be probable and then go on to the balancing test.
[17] At the third step of the Ribic test, in balancing or assessing whether the public interest in disclosure of the information outweighs the public interest in non-disclosure, the Court conducts a case-by-case assessment. The Court considers any public written or oral submissions of the parties, the ex parte submissions of the AGC and amicus, other ex parte submissions as applicable, and the relevant factors established in the jurisprudence that guide the balancing exercise (see for example Canada (Attorney General) v Khawaja, 2007 FC 490 [Khawaja FC] at paras 74 and 93; Tursunbayev, at paras 88–89. The factors include, among many others, the nature of the public interest sought to be protected; whether the information will probably establish a fact crucial to the case to be made (i.e., the degree of relevance or importance, or the significance or probative value of the information in the underlying proceeding); and, whether the redacted information is already known to the public, and if so how.
[18] Where the Court concludes that the public interest favours disclosure, the Court may authorize further disclosure in the form and under the conditions that are most likely to limit any injury resulting from disclosure pursuant to subsection 38.06(2) of the CEA.
[19] As noted by the Supreme Court of Canada in R v Ahmad, 2011 SCC 6 at para 44 [Ahmad], section 38 is designed to operate flexibly:
[44] Section 38 creates a scheme that is designed to operate flexibly. It permits conditional, partial and restricted disclosure in various sections. Section 38.06(1) affirmatively requires the Federal Court judge to consider the public interest in making disclosure along with what conditions are “most likely to limit any injury to international relations or national defence or national security” (s. 38.06(2)). In making this determination, the Federal Court judge may authorize partial or conditional disclosure to the trial judge, provide a summary of the information, or advise the trial judge that certain facts sought to be established by an accused may be assumed to be true for the purposes of the criminal proceeding. […]
II. The Section 38 Process to Date [20] On June 30, 2021, counsel for Al Jabri gave notice to the AGC in accordance with subsection 38.01(1) with respect to the disclosure of sensitive or potentially injurious information. This First Notice relates to a Confidential Appendix to Al Jabri’s affidavit and an attached exhibit that Al Jabri was required to file on his motion for a stay of proceedings [Stay Motion] in the Ontario Superior Court of Justice.
[21] On May 31, 2022, a Canadian Security Intelligence Service [CSIS] official gave notice to the AGC pursuant to subsection 38.01(3) that the official believed that sensitive or injurious information would be disclosed in a Notice of Motion and supporting Affidavit (related to the renewal of Al Jabri’s Stay Motion).
[22] On June 2, 2022, the AGC filed the Section 38 Application seeking an order with respect to the disclosure of information about which notice was given to the AGC in the First Notice and Second Notice. The AGC also sought an injunction prohibiting Al Jabri from disclosing sensitive or potentially injurious information in connection with proceedings in the Ontario Superior Court of Justice. The AGC subsequently requested that the motion for an injunction be held in abeyance pending further discussion with Al Jabri regarding his obligations under section 38.
[23] On June 16, 2022, the Court convened a Case Management Conference [CMC] regarding the next steps in the Section 38 Application. Among other issues discussed, the AGC noted an impediment to counsel for Al Jabri receiving and retaining sensitive and injurious information.
[24] A CMC scheduled for mid-July 2022 was adjourned given delays in clarifying how counsel for Al Jabri could receive and retain the information and its transmission to the AGC for review.
[25] On August 11, 2022, the Court convened a CMC. Sakab expressed concern about the delay in the process, including that Al Jabri had not yet provided the documents subject to the Second Notice to the AGC for review. The appointment of an amicus was discussed. The AGC also noted that the time necessary to review the documents, once received, could not be estimated.
[26] On August 15, 2022, the Court issued an Order appointing Mr. Colin Baxter, a security cleared lawyer, bound to secrecy in perpetuity in accordance with the Security of Information Act, RSC 1985, c O-5, as amicus curiae [amicus] to assist the Court in performing its statutory obligations under section 38 of the CEA. The Order provided, among other things, that the amicus shall have access to the confidential information in this Application (i.e., the redacted information, once available); that until such time as the amicus has had access to the confidential information and documents, he could communicate with the respondents for the purpose of understanding the information and documents to be reviewed; that once the amicus had access to the confidential information and documents he could not have any further communication with the respondents; and, that the amicus shall maintain the confidentiality of any information communicated to him in confidence by the respondents or any other person in connection with his role as amicus in this proceeding and that solicitor-client or litigation privilege will not be lost by virtue of its communication to the amicus. The Order further provided that the amicus may participate in any public hearing and shall participate in any in camera ex parte hearing in this proceeding, including by cross-examining any witness and presenting written and oral submissions.
[27] On September 12, 2022, this Court ordered that Al Jabri was prohibited from serving and/or filing his Stay Motion and any supporting evidence that may be sensitive or injurious information, as defined under section 38 of the CEA, unless authorized by the AGC or a further order of this Court. This Order was in response to the AGC’s motion for an injunction.
[28] On September 28, 2022, the Court convened a CMC. Among other information shared, the AGC noted that the AGC was in the process of reviewing the exhibit that was part of the First Notice and that the AGC expected additional documents to be provided pursuant to the Second Notice. Al Jabri noted that the document provided to the AGC for review pursuant to the Second Notice was a solicitor’s brief that included a great deal of information (describing it as “covering the waterfront.”) Al Jabri asserted that the solicitor’s brief (also referred to as the “proffer”) was subject to litigation privilege. Sakab expressed concern about the packaging of the document as subject to litigation privilege. The respondents jointly proposed that the public hearing—to permit submissions on the relevance of the information in the proffer and other documents—be scheduled, despite that the AGC had not completed the review of the documents, in order to make progress on the Section 38 Application. The public hearing was scheduled to take place on December 6 and 7, 2022.
[29] On October 19, 2022, Sakab filed their Notice of Motion (described more fully below).
[30] On November 3, 2022, the Court convened a CMC to discuss the scheduling of Sakab’s motion and its impact on the dates scheduled for the public hearing. The Court concluded that the dates for the public hearing should be set aside and instead used for the hearing of the Sakab motion. The timetable for the exchange of memoranda, responding memoranda and reply submissions on the Sakab motion were established.
[31] On November 15, 2022, the Court convened a CMC to canvass the next steps in light of the need to first determine the Sakab motion. The Court proposed that the public hearing could be scheduled for three days in February 2023. Sakab initially requested that five days would be needed for submissions. The AGC noted that their review and redaction of the information was expected to be completed by the end of December 2022.
[32] On November 25, 2022, counsel for Al Jabri provided a Third Notice to the AGC pursuant to subsection 38.01(1) specifically describing the proffer. The AGC confirmed in correspondence to Sakab that the information provided with respect to the Third Notice was the same information provided with respect to the Second Notice.
[33] The Sakab motion was heard on December 6 and 7, 2022. In addition to three sets of submissions from Sakab on the motion, Sakab filed a Responding Record to the Section 38 Application with an Affidavit attaching over 1600 pages of exhibits. Sakab noted that the record was equally useful for the motion. Al Jabri filed submissions and responding submissions and an affidavit attaching a decision of a US Federal District Court. The amicus and AGC also filed responsive submissions.
[34] On December 15, 2022, the AGC filed a Further Amended Amended Notice of Application pursuant to Section 38.04 to specifically add the information covered by the Third Notice (which is identical to the information covered by the Second Notice).
III. Overview of the Sakab Motion [35] The issues on the Sakab motion have evolved since it was filed on October 19, 2022. Sakab initially took the position that this Court does not have jurisdiction to determine whether the information as described in the Second Notice to the AGC can be protected because the document provided by Al Jabri to the AGC differed from that described in the Second Notice and in the AGC’s Notice of Application pursuant to section 38.04 of the CEA. The Second Notice, provided to the AGC by an official at CSIS, referred to information that the official believed would be disclosed in a Notice of Motion and Affidavit that Al Jabri was expected to file in the Ontario Superior Court of Justice with respect to Al Jabri’s intention to seek a stay of the proceedings in that Court. Sakab submits that although Al Jabri was required to file his Notice of Motion and affidavit in accordance with the timetable agreed upon and ordered by the Ontario Superior Court of Justice and intended to do so on or around June 6, 2021, as noted in various correspondence between counsel, he did not do so, and instead submitted the proffer to the AGC.
[36] Sakab argues that Al Jabri—in an effort to thwart the proper determination of the Section 38 Application and exclude Sakab from the process—provided a different document to the AGC. Sakab alleges that Al Jabri deliberately created the solicitor’s brief or proffer and asserted litigation privilege to prevent Sakab from receiving the proffer following the review by the AGC and the redaction of sensitive or injurious information. Sakab asserts that but for the cloak of litigation privilege, Sakab would receive the document following the AGC’s review and could glean information from the unredacted parts that would guide them in their submissions in a public hearing with respect to the relevance—or lack of relevance—of the information.
[37] Sakab initially argued that because the proffer did not reflect the Second Notice, it was not properly subject to the Section 38 Application. Given that counsel for Al Jabri subsequently sent a Third Notice to the AGC, which specifically refers to injurious or sensitive information in the proffer, and the AGC has acknowledged that the information in its possession for review and possible redactions pursuant to section 38 is the same information that the AGC received with respect to the Second Notice, this argument need not be addressed.
[38] Sakab’s arguments on this motion now focus on their concern that the section 38 process will be unfair to Sakab. Sakab argues that they are left “in the dark” and cannot meaningfully participate. Sakab alleges that the proffer includes “secret submissions” on the relevance of the factual information to Al Jabri’s defence. Sakab notes that the AGC has received the proffer for review and that the amicus and the Court will also receive the proffer after the AGC has completed the review and seeks the Court’s confirmation of any redactions, leaving Sakab as the only party who will not receive the redacted proffer. Sakab argues that given the complexity of the litigation in the Ontario Superior Court of Justice and given that—according to Sakab—Al Jabri’s goal is to have the proceedings stayed by asserting that he is unable to defend himself because he will not be able to rely on sensitive and injurious information which he claims is relevant to his defence, Sakab must have the opportunity to make submissions to the Court that this information is not relevant. Sakab disputes that the appointment of an amicus mitigates this unfairness, noting that the amicus is in a unique position because the two respondents, Sakab and Al Jabri, take very different positions.
[39] In the Notice of Motion filed by Sakab on October 19, 2022, Sakab seeks an order to direct Al Jabri to provide the AGC with the documents subject to the Second Notice given to the AGC. More particularly, Sakab seeks the material that Al Jabri indicated that he would file in the Ontario Court of Justice in support of his motion for a stay of proceedings, including the Notice of Motion to be filed, Al Jabri’s supplementary affidavit, and any further evidence relating to Al Jabri’s position that: he cannot defend himself in the fraud action without disclosing the US Government’s secret information; issues in the fraud action are non-justiciable; and, the fraud action is barred by the State Immunity Act, RSC 1985, c C-18. Sakab submits that following the AGC’s review, a redacted version of those documents should be provided to Sakab and the section 38 process should proceed to determine the disclosure of the information properly covered by the First and Second Notices.
[40] Alternatively, Sakab seeks an Order dismissing or staying the AGC’s Section 38 Application with respect to the Second Notice.
[41] Sakab’s Notice of Motion is 24 pages in length and sets out the grounds for the motion; the background to the litigation in the Ontario Superior Court of Justice; the process to date in this Court with respect to the AGC’s Section 38 Application; and, an overview of Sakab’s position that the information described in the Second Notice does not meet the requirements of section 38 and that the Court does not have the authority to determine whether to confirm the prohibition on the disclosure of that information.
[42] Sakab also filed the Affidavit of Lorraine Klemens, sworn on November 1, 2022, which is identified as Sakab’s Motion Record in response to the AGC’s Section 38 Application, and which Sakab advised at the CMC held on November 3, 2022, would be relied on in the Sakab motion. Lorraine Klemens’ affidavit describes and attaches 38 exhibits totalling over 1600 pages. The exhibits include the Amended Statement of Claim, Statement of Defence, transcripts of cross-examinations, affidavits relied on in support of Sakab’s request for injunctive relief in the Ontario Superior Court of Justice, Orders of the Ontario Superior Court of Justice, and the decision of the US Federal District Court dated December 29, 2021, dismissing Sakab’s action in the state of Massachusetts.
IV. Sakab’s Submissions [43] Sakab made extensive submissions to the Court, including providing their perspective on Al Jabri’s conduct in Sakab’s fraud action.
A. The Background from Sakab’s Perspective [44] Sakab points to the record to support their submission that the creation of the proffer in the context of the Section 38 Application was a strategy by Al Jabri to both stall and add new grounds for his Stay Motion. Sakab submits that Al Jabri fully intended to pursue his Stay Motion in June 2022 even in the face of the AGC’s Section 38 Application, yet he then created a new document to shield the same information from Sakab and exclude them from the section 38 process. Sakab submits that Al Jabri’s conduct throughout the litigation leads to this conclusion.
[45] Sakab portrays Al Jabri’s various motions and responses to Sakab’s motions as thwarting Sakab’s pursuit of their fraud action. While not a comprehensive account of the various proceedings that have led to Al Jabri’s assertion that he cannot defend this action due to the nature of information he possesses that he cannot disclose, Sakab notes several examples.
[46] Sakab first notes that a report prepared by Deloitte traced many payments to Al Jabri or his family members and to offshore companies controlled by Al Jabri. Sakab contends that many payments allegedly made to others for products or services provided “kickbacks” to Al Jabri. A more recent report by Deloitte has led to Sakab amending their Statement of Claim to increase the amount of damages to over $5 billion.
[47] Sakab explains that the same day that they filed their Statement of Claim on January 21, 2021, the Ontario Superior Court of Justice granted a Mareva order freezing Al Jabri’s worldwide assets, and granted a Receivership order appointing a Receiver to protect properties located in the US. Sakab submits that these orders followed a finding of prima facie evidence of fraud.
[48] In March 2021, Al Jabri’s motion to set aside the Mareva order was dismissed.
[49] Sakab notes that Al Jabri was required to provide a declaration of his assets in response to the Mareva order. On cross-examination, Al Jabri revealed that he had transferred one of his companies and other assets to his son as a gift very soon after he was removed from his position in the KSA in 2015. Sakab’s attempt to have the Mareva order extended to cover Al Jabri’s son led to the further revelation that Al Jabri did not write a gift deed as he had attested for tax purposes, but rather gave verbal instructions regarding this gift.
[50] Sakab notes that Al Jabri’s son disputed that the Mareva order could apply to him. However, the Ontario Superior Court of Justice found that the entire gift was a “ruse” and that Al Jabri continued to control the assets he purported to transfer by gift.
[51] Sakab also points to Al Jabri’s motions to stay the proceedings, including in April 2021, alleging abuse of process. Sakab notes that a day before the motion record was to be filed, on June 30, 2021, counsel for the US Government advised counsel for Al Jabri that disclosure of protected information in the context of that motion would engage Al Jabri’s obligations under section 38. Sakab notes that Al Jabri’s request to delay filing did not succeed. The Ontario Superior Court of Justice found that a motion was required by the US Government in order for the US to participate in the proceedings. Sakab notes that Al Jabri then complied and filed an extensive affidavit along with a confidential annex, for which the First Notice was given to the AGC regarding the potential disclosure of sensitive information. Sakab characterizes this as one of the first indications that Al Jabri would raise the argument that he could not defend himself because of his inability to rely on sensitive information. This Stay Motion was adjourned pending Sakab’s motion for contempt based on allegations that Al Jabri continued to dissipate assets.
[52] Sakab adds that their contempt proceedings have been stalled due to other applications and motions by Al Jabri.
[53] Sakab explains that they were required to launch proceedings in Massachusetts to give effect to the Mareva order given that Al Jabri had several assets in that state. Although Sakab clearly stated in their claim that the litigation would be stayed once the Mareva order was recognized, Sakab submits that Al Jabri challenged the claim in order to advance his arguments that he could not defend himself without secret information that was protected in the US. Al Jabri successfully moved to have Sakab’s claim heard by the US Federal District Court.
[54] Sakab submits that following the December 2021 decision of the US Federal District Court dismissing Sakab’s claim (for which a decision on appeal is pending), Al Jabri added new grounds to his pending Stay Motion in Ontario alleging that he could not defend Sakab’s action due to the prohibition on relying on US state secrets.
[55] Sakab also notes that Al Jabri brought a motion in the Ontario Superior Court of Justice requesting that any information relied on in his Stay Motion could not be used in other proceedings, including Sakab’s motion for contempt. The Ontario Superior Court of Justice dismissed the motion finding that “use immunity” was not applicable.
[56] Sakab notes that, as a result, Al Jabri was required to file material in support of his Stay Motion on May 8, 2022. Al Jabri requested an extension. The Ontario Superior Court of Justice ordered that the documents be filed by June 6, 2022.
[57] With respect to the current status of Sakab’s fraud action, Sakab notes that Al Jabri would be required to file an amended Statement of Defence by December 16, 2022, in response to Sakab’s amended Statement of Claim.
[58] Sakab asserts that intervening events in May and June 2022 were unknown to Sakab at that time, including that counsel for the US Government wrote to the AGC advising that counsel for Al Jabri had advised that Al Jabri intended to file his affidavit, which would disclose US national security-related information. The AGC then wrote to counsel for Mr. Al Jabri advising of the obligations pursuant to section 38. Sakab notes that despite this caution, counsel for Al Jabri indicated that his affidavit would be filed unless an injunction prevented him from doing so.
[59] Sakab suggests that Al Jabri’s flaunting of his section 38 obligations forced CSIS to give a notice to the AGC (Second Notice). The Second Notice from CSIS to the AGC referred to Al Jabri’s Notice of Motion and affidavit that would disclose sensitive information. Sakab adds that even after the AGC received the Second Notice, counsel for Al Jabri continued to dispute the requirements of section 38.
[60] Sakab contends that Al Jabri’s conduct up to June 2022 supports the conclusion that Al Jabri had every intention to file his Stay Motion and affidavit. Sakab contends that the affidavit was ready to be filed until Al Jabri reacted to the AGC’s intention to pursue an injunction, which Al Jabri later agreed to. Sakab adds that the Ontario Superior Court of Justice then had no other option but to adjourn Al Jabri’s Stay Motion given the AGC’s Section 38 Application.
[61] Sakab further notes that the proceedings in this Court, following the filing of the AGC’s Section 38 Application, evolved. As noted above, Sakab submits that Al Jabri delayed and did not provide the material described in the Second Notice, but rather created the proffer and cloaked it with litigation privilege in a deliberate attempt to thwart Sakab’s participation in the section 38 process.
[62] Sakab doubts Al Jabri’s explanation that he could not complete or file his affidavit due to the AGC’s caution to counsel for Al Jabri that counsel should not receive information without guidance on how to receive and handle sensitive information.
[63] Sakab suggests that Al Jabri has no genuine interest in any disclosure of the information subject to the Notices submitted to the AGC, but rather wants disclosure prohibited in order to advance his argument that he cannot defend himself without this information and, as a result, Sakab’s claims should be dismissed.
[64] Sakab submits that Al Jabri’s strategy is evident given Al Jabri’s more recent submission that he may not renew his Stay Motion as this will depend on the outcome of the Section 38 Application.
[65] Sakab also submits that it is disingenuous for Al Jabri to argue that he raised the issue of his need to rely on sensitive information early in the litigation, noting that Al Jabri did not file any personal affidavit until June 2021.
[66] Against this backdrop of Al Jabri’s conduct and allegedly deliberate attempt to stall the litigation and “freeze out” Sakab from the section 38 determination, Sakab argues that the Court must intervene to ensure fairness and guard against abuse of process.
B. Al Jabri’s Conduct is Intended to Exclude Sakab [67] Sakab submits that Al Jabri is attempting to manufacture a basis for a stay of proceedings through this Section 38 Application, including by creating this proffer and cloaking it with litigation privilege, rather than providing the Stay Motion and affidavit for review by the Court and then providing that redacted document to Sakab.
[68] Sakab argues that Al Jabri’s creation of a proffer is a deliberate attempt by Al Jabri to prevent Sakab from participating in the Section 38 proceedings because Sakab will not receive the redacted proffer due to the assertion of litigation privilege. Sakab submits that this precludes them from making submissions on the relevance—or more particularly, the irrelevance—of the information or on other aspects of the Ribic test to assist the Court in its determination of whether the information is relevant and whether the disclosure of any injurious information should remain prohibited.
[69] Sakab submits that their motion should be granted to address the unfairness and abuse of process because they will not have access to the redacted proffer for their participation in the public hearing in the Section 38 Application. Sakab submits that the Court has an obligation to “level the playing field.”
[70] Sakab notes that Al Jabri stated that he expects to disclose the information to the extent possible in his Stay Motion or in the course of litigation. Sakab, therefore, submits that the Court should order that Al Jabri provide the Stay Motion material now to the AGC for review or provide a new proffer that contains only factual information. Sakab notes that factual content cannot be privileged.
[71] Sakab proposes three options: first, that the Court order Al Jabri to waive litigation privilege in the proffer; second, that the Court order Al Jabri to hive off the factual information in the proffer from the litigation privileged parts and provide a new document with only the factual information to the AGC for review; or, third, that the Court order Al Jabri to provide the AGC with the Stay Motion and affidavit he indicated he would file and intended to file in June 2022 for the AGC’s review.
[72] In oral submissions, Sakab noted a fourth option, suggesting that Sakab would bring a further motion for a determination on a question of law to determine whether the proffer is privileged given that it was provided by Al Jabri to an adversary—the AGC.
C. The Court must Control its Process
[73] Sakab submits that this Court has the inherent power to control the integrity of its own process and redress Al Jabri’s abuse of the Court’s process (Canada (National Revenue) v RBC Life Insurance Company, 2013 FCA 50 at para 36 [RBC Life].
[74] Sakab points to X (Re), 2017 FC 136, at paras 31 and 32, where Justice Noël highlighted that this Court has a broad responsibility to ensure fairness in national security matters due to the closed nature of the proceedings, and that this responsibility extends to ensuring that the process is fair.
[75] Sakab suggests that the Court must be alive to the mischief caused by raising evidence that engages section 38 in order to “sabotage” a trial. Sakab points to Ahmad, at para 74, where the Supreme Court of Canada noted the concern voiced by the Commissioner in the Air India Inquiry that an accused “might attempt to use the two-court system to sabotage a terrorism trial by intentionally calling evidence that would engage section 38.”
[76] Sakab also points to Ahmad, at paras 31–33, where the Court noted that prosecutions should not be derailed because a trial judge is denied access to information that cannot be disclosed and that the trial judge must have a sufficient understanding of the nature of the withheld information. Sakab submits that this same concern applies in non-criminal proceedings.
D. Sakab Seeks Meaningful Participation in the Section 38 Application [77] Sakab notes that Al Jabri will argue that the information he seeks is highly relevant and essential for his defence, but Sakab will argue the opposite. Sakab further notes that relevance is determined with reference to the issues in the litigation—the causes of action and the defences available. Sakab submits that given the complexity of the litigation, which engages the law of KSA, Sakab must provide the Court with a complete understanding of how their claim will be litigated, including how the sensitive or injurious information is not relevant or probative of Al Jabri’s defences.
[78] Sakab suggests that without Sakab’s meaningful participation and submissions, the Court will not be able to apply the Ribic test and determine relevance at the first stage or conduct the balancing at the third stage, which includes consideration of the significance and probative value of the information.
[79] In response to the Court’s question about why the Court requires a complete understanding of the claims and defences and the law of the KSA in order to determine the Section 38 Application, noting that the threshold for relevance at the first stage of the Ribic test is low, Sakab responds that some defence