THE RECENT RULING by Ontario's highest court, which required The National Post to give the RCMP a document and the envelope it contained for forensic testing aimed at disclosing its source, has been wrongly attacked as diminishing our constitutionally guaranteed freedom of the press.

The Canadian Association of Journalists called it "a major setback for press freedom," saying it was "gravely dismayed by a regressive appeal court ruling."

Even The Globe and Mail went almost as far, declaring that while the court had acknowledged that journalists have a right to protect their confidential sources in appropriate cases, "its words suggest that it is dismissive of that right."

We disagree. In fact, we think the unanimous Ontario Court of Appeal ruling should be seen as confirming the right of journalists to protect sources in most cases.

The judgment, released on Feb. 29, must be seen in its unusual context.

The document was sent to Andrew McIntosh, an award-winning investigative journalist for the Post, who wrote a series of articles - eventually dubbed "Shawinigate" - concerning then prime minister Jean Chrétien's investment in the Grand- Mére Golf Club, located in his St. Maurice riding. During his investigation, he also became interested in Mr. Chrétien's involvement with a 1997 Business Development Bank of Canada (BDBC) loan to the Auberge Grand-Mére, a hotel located next to the golf club.

The reporter's initial stories, published in January 1999, prompted several people to contact him, and he made promises of confidentiality as he deemed it necessary. One of the callers was initially unwilling to give him some information, even on a confidential basis, but finally agreed to send him materials, including what appeared to be copies of original BDBC documents.

Addressed to him, the document in question came on April 5, 2001, in a sealed plain brown envelope in the daily mail delivery to the Post's Ottawa bureau.

It appeared to be a copy of a BDBC internal loan authorization for a $615,000 mortgage to Les Entreprises Yvon Duhaime Inc. (Auberge Grand-Mére) in August 1997. If authenticated, it provided proof of a serious conflict of interest on the part of Mr. Chrétien which could have forced him to resign. However, the BDBC, the Prime Minister's office, and David Scott, counsel to the Prime Minister, all claimed it was a forgery, and the bank asked the RCMP to investigate.

The RCMP agreed, and applied for a search warrant and assistance order to obtain the envelope and document so they could conduct fingerprint and/or DNA analysis to identify their source.

The Post responded by asking Superior Court Justice Mary Lou Benotto to quash the warrant and order. In 2004, she agreed, holding that the police request unreasonably infringed the guarantee of press freedom found in Section 2(b) of the Canadian Charter of Rights and Freedoms.

In overturning her ruling, the Court of Appeal cited a 2001 decision of the Supreme Court of Canada which held that the confidentiality of the relationship between a journalist and a source should be protected on a case-by-case basis involving four criteria: (a) the communications must originate in a confidence that they will not be disclosed; (b) the confidentiality must be essential to the full and satisfactory maintenance of the journalist-source relationship; (c) that relationship must be one which in the opinion of the community ought to be "sedulously fostered," and (d) the injury to that relationship from disclosure of the communications must be greater than the benefit gained.

Writing for the court, Justice John Laskin accepted "that the gathering and dissemination of news and information without undue state interference is an integral component of the respondents' constitutional right of freedom of the press. ... However, this does not mean that press organizations or journalists are immune from valid searches under s. 8 of the Charter. And s. 2(b) does not guarantee that journalists have an automatic right to protect the confidentiality of their sources. The court must ensure that the privacy interests of the press are limited as little as possible. But the court must also balance against the privacy interest of the press the state or other societal interests in getting at the truth."

In this case, he said, the police interest in the criminal investigation outweighed the right of the press to protect confidential sources. "We do not diminish the press's important role in uncovering and reporting an alleged wrongdoing. But in our society it is the police who are charged with the critical role of investigating and prosecuting crime." Justices Janet Simmons and Eileen Gillese concurred.

Interestingly, even Douglas Kelly, the Post's editor-in-chief, said it was important to point out that the court "does uphold some basic journalistic principles, including the importance of being able to protect the confidentiality of sources when pursuing important stories that are in the public interest."

Interestingly, the Post apparently hasn't been able to authenticate the document and did not publish the damaging allegation against Mr. Chrétien, which was published by other media in the context of Mr. Chrétien's denial.

In the circumstances, one might think that the newspaper would welcome the chance for the RCMP to do a thorough investigation so as to find out whether the newspaper was duped.

The case should also cause Canadian journalists to warn sources that protecting their identity is always conditional on the information being truthful.