The appellants, a cat rescue operation and its director, appealed the dismissal of their defamation action under s. 137.1 of the Courts of Justice Act.
The motion judge had dismissed the action against all defendants, including non-moving parties, and awarded costs.
The Court of Appeal found that the motion judge erred by misapplying the s. 137.1 criteria, specifically by using a higher standard for assessing the substantial merit of the claim, mischaracterizing the "sting" of the defamation, relying on inadmissible hearsay, and improperly assessing the harm suffered by the appellants.
The Court also held that the motion judge erred in dismissing the action against defendants who had not brought a motion to dismiss.
The appeal was allowed, the dismissal order set aside, and the matter remitted for further proceedings.