Do Corporations Have a Right to Privacy?

  • August 01, 2017
  • Marc Dumais

Corporate privacy interests considered

In British Columbia, the question of whether a corporation has standing to bring a claim for breach of privacy was recently considered in Madco Investments Ltd. v. Western Tank & Lining Ltd (“Madco”).1 While British Columbia does not recognize a common law tort for breach of privacy or “intrusion upon seclusion,” a statutory right of action for breach of privacy does exist under the British Columbia Privacy Act.2 

In Madco, the individual plaintiff, Mr. Ducey, was a former employee and director of the corporate defendant, Western Tank & Lining Ltd. (“WTL”). Mr. Ducey was also the owner of the plaintiff corporation, Madco Investments Ltd. (“Madco” and, together with Mr. Ducey, the “Plaintiffs”), the largest shareholder of WTL. In the underlying action, Mr. Ducey claimed against WTL and several of its corporate and individual shareholders (the “Defendants”) for, inter alia, constructive dismissal, breach of a shareholders’ agreement, and bad faith and oppressive conduct. The Defendants counterclaimed against Mr. Ducey for breach of privacy stemming from his alleged unauthorized access to the email accounts of certain WTL shareholders and employees, including in connection with emails relevant to the subject litigation.

The Plaintiffs sought to have this portion of the Defendants’ counterclaim struck on the basis that WTL, as a corporation, did not have standing to bring a claim for breach of privacy where the privacy interest that was alleged to have been breached was that belonging to WTL’s employees and shareholders, whose email accounts were allegedly wrongfully accessed. In particular, the Plaintiffs argued that breach of privacy is an in personam right and, as a result, the Defendants, and WTL in particular, could not advance a claim in privacy on behalf of its employees and shareholders. Implicit in the Plaintiffs’ argument was the idea that a corporation could not bring a claim for the breach of the privacy of one of its representatives.

Finding that the alleged breach engaged both “individual and corporate interests,”3 the court in Madco concluded that it was not “plain and obvious” that WTL, as a corporation, did not have standing to pursue an action for breach of privacy under the Privacy Act in the circumstances. The court came to its conclusion based on a plain reading of Section 1 of the Act, which provides that “it is a tort, actionable without proof of damage, for a person, willfully and without claim of right, to violate the privacy of another.” As the word “person” is not defined in the Act, the court relied on Section 29 of British Columbia’s Interpretation Act 4 (which defines the word “person” to include a “corporation”) to conclude that corporations were not clearly excluded under British Columbia’s privacy statute.

While the court in Madco did not decide the issue of whether a corporation could bring a successful claim for breach of privacy under British Columbia’s Privacy Act, its conclusion that such an outcome is possible raises interesting questions about the privacy interests at stake in the corporate context, and whether the concept of privacy, as a legal principle, is or ought to be limited to human beings. 

  1. 2017 BCSC 219. |
  2. R.S.B.C. 1996, c. 373. |
  3. Madco, at para. 70. |
  4. R.S.B.C. 1996, c. 238. |

__________________________________________________________________________________________

Marc Dumais is an associate at Blake, Cassels & Graydon LLP in Vancouver. His practice focuses on commercial litigation, securities litigation and privacy law.