In a decision released on Friday, the Supreme Court of Canada has recognized a new principle of fundamental justice: a lawyer’s duty of commitment to the client’s cause.

In Canada (Attorney General) v Federation of Law Societies of Canada, the Federation of Law Societies commenced a constitutional challenge to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its regulations. The legislation is designed to limit the risk that financial intermediaries may launder money or finance terrorists, either wittingly or not. It requires financial intermediaries (including lawyers) to collect, record and retain information verifying the identity of those on whose behalf they pay or receive money. It puts in place an agency to oversee compliance, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), and allows that agency to search for and seize that material. The legislation authorizes sweeping searches of law offices and imposes fines and penal consequences for non-compliance. The central contention of the Law Societies was that the scheme substantially interferes with lawyers’ duty of commitment to their clients’ cause because it imposes duties on lawyers to the state to act in ways that are contrary to their clients’ legitimate interests and may, in effect, turn lawyers into state agents for that purpose.

Finding several provisions of the legislation repugnant to duties essential to the due administration of justice, the Supreme Court recognized as a principle of fundamental justice that the state cannot impose duties on lawyers that undermine their duty of commitment to their clients’ causes. The duty is fundamental to the solicitor-client relationship and how the state and the citizen interact in legal matters. The lawyer’s duty of commitment to the client’s cause is essential to maintaining confidence in the integrity of the administration of justice. The Supreme Court found that the impugned legislation requires lawyers to create and preserve records not required for ethical and effective representation, with the knowledge that solicitor-client confidences contained in those records are not adequately protected against search and seizure. Taken as a whole, the legislation limits the liberty of lawyers in a manner that is not in accordance with the newly-recognized principle of fundamental justice relating to the lawyer’s duty of committed representation. As a result, several provisions of the legislation should be read down to exclude legal counsel and legal firms from their scope of operation. Further, other provisions were declared to be of no force or effect, in their entirety.

However, the Supreme Court declined to determine the existence of the broader principle of fundamental justice that had been identified by the BC Court of Appeal as “the independence of the bar”, which was interpreted to mean that lawyers “are free from incursions from any source, including from public authorities”. Whether that broader principle exists will have to wait for another day.