Evidence is the backbone of any litigation. But what happens when a party intentionally destroys evidence that could affect the outcome of a case? Are the current legal remedies strong enough to address the prejudice that spoliation creates?
The doctrine of spoliation in Canada is well established in some respects and unsettled in others. With the Supreme Court of Canada (the “Supreme Court”) set to weigh in, greater clarity appears to be on the horizon. As the Supreme Court prepares to consider spoliation in SS&C Technologies Canada Corp v. The Bank of New York Mellon Corporation, guidance from the country’s highest court could significantly affect litigation strategy, document‑retention practices, and the consequences parties face when evidence goes missing.
What is spoliation in Canadian law?
Spoliation is defined as the intentional destruction of relevant evidence in ongoing or contemplated litigation (McDougall v. Black & Decker Canada Inc, 2008 ABCA 353) (“McDougall”). When intentional destruction is proven, a rebuttable presumption arises that the evidence would have been unfavourable to the party that destroyed it. The burden then shifts to the alleged spoliator to show that, although the destruction was intentional, it was not intended to influence the litigation (St. Louis v. The Queen, 1896 CanLII 65 (SCC)).
At its core, spoliation is an evidentiary doctrine designed to protect the integrity of the civil justice system and the administration of justice.
Is an adverse inference enough to deter spoliation?
Although courts since St. Louis have been reluctant to broaden the principles of spoliation, several decisions suggest a willingness to apply those principles more flexibly:
- Courts have relied on spoliation principles to fashion remedial consequences, such as excluding expert evidence or denying costs, even without recognizing a stand‑alone tort (McDougall, citing Endean v. Canadian Red Cross Society, 1998 CanLII 6489 (BC CA)).
- Some appellate decisions have hinted that spoliation may warrant sanctions beyond an adverse inference, including cost consequences (McDougall, citing Doust v. Schatz 2002 SKCA 129).
- Courts have queried whether negligence or recklessness, rather than intentional destruction, could suffice to trigger adverse inferences (McDougall, citing Lamont Health Care Centre v. Delnor Construction Ltd, 2003 ABQB 998).
However, these cases reflect a broader concern: is an adverse inference alone a sufficient response to the intentional destruction of evidence? Does the lack of a forceful response to spoliation creating an incentive for litigants to engage in evidence-destroying behaviour? The Alberta Court of Appeal in McDougall left these questions open, awaiting another case “on a later day.”
That later day now is approaching.
The Supreme Court of Canada’s pending spoliation decision
The Supreme Court of Canada heard the appeal in SS&C Technologies Canada Corp v. The Bank of New York Mellon Corporation, 2024 ONCA 675 (“SS&C Technologies”), on December 10, 2025. The decision has the potential to clarify long‑standing uncertainty surrounding the scope of spoliation and the remedies available.
Overview of SS&C Technologies
The underlying dispute concerns a data licensing agreement under which SS&C provided market pricing data that BNYM and its predecessor allegedly redistributed to numerous affiliates in breach of contract. BNYM then destroyed relevant records, even after a preservation demand had been issued by SS&C.
Both the trial judge and the Court of Appeal for Ontario (the “Court of Appeal”) found that BNYM intentionally destroyed relevant evidence in the face of pending litigation, with the result that SS&C could neither determine how much of its proprietary data was shared with or used by BNYM’s unlicensed affiliates, nor calculate damages based on that unlicensed use.
The Court of Appeal found that BNYM had engaged in spoliation and held that its conduct in doing so “smack[ed] of contempt for the justice system.” Despite this, the Court of Appeal upheld the trial judge’s discretionary damages award to SS&C, which SS&C now argues creates a windfall for BNYM of as much as $145,000,000 USD based on its theory of damages.
In its appeal to the Supreme Court, SS&C argued that such a windfall effectively signals to BNYM and other litigants that spoliation can be a viable, and even strategically advantageous, litigation tactic.
Key issues for the Supreme Court of Canada
The Supreme Court now has an opportunity to clarify several issues relating to spoliation, including:
- whether adverse inferences should be treated as permissive or mandatory;
- the remedies courts can impose, and whether such remedies should remain discretionary;
- how courts should approach damages assessments in the face of evidentiary gaps caused by spoliation; and
- whether spoliation is purely evidentiary or whether it should be recognized as an independent tort.
The Supreme Court’s decision could reshape how litigants manage documents and how courts respond when the integrity of the evidentiary process is compromised through spoliation.
What comes next?
We will continue to monitor developments closely and provide an update once the Supreme Court releases its decision.
If you are anticipating litigation and require advice on evidence preservation or managing spoliation risks, please contact Miller Thomson’s Commercial Litigation Group.
