COURT OF APPEAL FOR ONTARIO
Lauwers, Hourigan and Pardu JJ.A.
BETWEEN
Cathy Frank
Plaintiff (Appellant)
and
Barbara Legate, Joni Dobson, Keith Finley and Legate & Associates LLP
Defendants (Respondents)
Nathaniel Erskine-Smith, for the appellant
Paul Michell, for the respondents
Heard: March 5, 2015
On appeal from the order of Justice Thomas J. Carey of the Superior Court of Justice, dated August 5, 2014.
INTRODUCTION
1Cathy Frank appeals from the order of Carey J. striking her statement of claim under rule 21.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, on the ground that it did not disclose a reasonable cause of action.
2The appellant submits that the motion judge erred by effectively turning the pleadings motion into a summary judgment motion and thereby applied the wrong test in his review of her statement of claim.
3For the reasons that follow, I would dismiss the appeal. The appellant’s action was fundamentally misconceived. I see no error in the motion judge’s conclusion that the causes of action advanced by the appellant were either premature or were not properly pleaded. Regardless, the appellant’s claim was also an abuse of process and could have been struck on that basis.
BACKGROUND FACTS
4The appellant is an obstetrician and gynecologist who practices medicine in London, Ontario.
5The respondents are lawyers who represent the appellant’s former patients in complaints with the College of Physicians and Surgeons of Ontario (“the College”) and medical malpractice actions against the appellant.
6The appellant’s statement of claim alleged that certain statements by the respondents, six of which were published on the website of the respondents’ law firm and one of which was published in an article on the CTV news website, were defamatory. Those statements are set forth below.
7In addition to the defamation claim, the appellant also asserted claims for malicious prosecution, champerty and maintenance, intentional interference with economic relations and intentional infliction of mental distress. She claimed $5 million in damages, including $500,000 in punitive damages.
8The respondents brought a motion to strike the appellant’s statement of claim under Rule 21 on the basis that it failed to disclose a reasonable cause of action. In their notice of motion they also sought to strike the claim under rule 25.11 on the ground that it was scandalous, frivolous, vexatious and an abuse of process. Prior to the motion, the appellant delivered a “proposed amended statement of claim” to the respondents. The appellant did not bring a motion to amend the original statement of claim.
THE DECSION BELOW
9The motion judge struck the appellant’s claim in its entirety. In his reasons, he considered each of the causes of action asserted by the appellant.
10With respect to the defamation claim, the motion judge noted that courts will only strike defamation pleadings in the “clearest of cases”. He described his task as determining whether an ordinary, thoughtful, well-informed member of society would reasonably conclude that the words complained of were capable of conveying a defamatory meaning. None of the impugned statements met this standard. The first five were purely informational and expressed no view on the merits of any of the claims against the appellant. The sixth statement was appropriately qualified by the words “we allege”. The seventh and final statement again did not comment on the merits of any claims against the appellant.
11The motion judge found that the malicious prosecution action was premature because none of the lawsuits or complaints to the College had yet been terminated or resolved. The appellant’s statement of claim alleged that all the cases and complaints had, or will be resolved in her favour. While the motion judge recognized that he was required to accept the appellant’s allegations as true unless they were not provable, he concluded that the question of whether the complaints and actions would terminate in the appellant’s favour was not yet provable.
12Given that the lawsuits against the appellant were ongoing, the claim for champerty and maintenance was also premature. Regardless, the factual allegations in the statement of claim did not support these causes of action. The appellant did not plead that the respondents “stirred up” litigation that would not otherwise have been pursued or that they brought baseless claims as a form of intimidation.
13On the claim of intentional interference with economic relations, the motion judge noted that this cause of action permits a plaintiff to sue a defendant for economic loss caused by the defendant’s unlawful act against a third party where the defendant intended to damage the plaintiff. The motion judge concluded that the appellant’s pleadings were “unspecified” and did not suggest that the elements of this tort were met. Further, the alleged “unlawful act” appeared to be that the respondents made misrepresentations to the appellant’s former patients. These communications are protected by solicitor-client privilege. As a result, this claim was also struck under rule 25.11 since it relied on inadmissible evidence.
14The motion judge concluded that the appellant failed to particularize the conduct giving rise to her claim for intentional infliction of mental distress. He noted that a defendant reading the statement of claim would not know what conduct was at issue in relation to this claim.
15On the claim for punitive damages, the motion judge found that the appellant’s allegation that the respondents’ conduct was a “callous, flagrant, arbitrary, malicious, high-handed, capricious, arrogant and complete and flagrant disregard of the rights of the plaintiff and of the plaintiff’s patients” did not particularize any conduct that could give rise to this type of award.
16The motion judge went on to consider the putative amended statement of claim and concluded that the proposed amendments did not remedy any of the defects in the issued claim.
17Finally, the motion judge noted that absent further substantial, specific allegations, any continued action against the respondents ran the risk of being seen as an abuse of process. He found that the claims would likely be viewed as a collateral attack aimed at intimidating and distracting the respondents.
18Quite unusually, the motion judge did not consider the issue of whether the appellant should be granted leave to amend her statement of claim. The appellant does not seek that relief in her notice of appeal or factum.
POSITIONS OF THE PARTIES
(i) Position of the Appellant
19The appellant submits that a defamation claim should only be struck on a Rule 21 motion where the impugned statements are clearly not capable of a defamatory meaning. The statements at issue in this case do not fall within the clearest of cases. She argues that the motion judge also erred by suggesting that the defamatory statements pleaded in the proposed amended statement of claim could not support an allegation of defamation.
20The appellant argues that the tort of malicious prosecution applies to civil actions and disciplinary proceedings. The motion judge was required to assume that the facts pleaded in the statement of claim were true. Given that the statement of claim stated that all proceedings “have, or will, terminate” in the appellant’s favour, the motion judge erred in finding that no proceedings had terminated in her favour and in relying on a representation by counsel for the respondents regarding the current status of the actions and complaints in reaching that conclusion.
21Regarding the claim for champerty and maintenance, the appellant submits that the elements were properly pleaded and that the motion judge erred by failing to read the pleadings broadly.
22With respect to the intentional interference with economic relations claim, the appellant pleaded that the respondents made misrepresentations to induce the appellant’s former patients to pursue claims against the appellant. Because the misrepresentations were public statements, the motion judge’s finding that the alleged misrepresentations were protected by privilege was an error.
23The appellant also submits that the motion judge erred by dismissing her claim for intentional infliction of mental distress on the ground that the statement of claim did not particularize the comments or actions. The motion judge should have read the pleadings as a whole, rather than focusing solely on one paragraph.
24Finally, the appellant argues that the motion judge erred by relying on a breach of contract case to conclude that the appellant’s statement of claim for punitive damages did not sufficiently particularize her claim. The causes of action advanced by the appellant are significantly more egregious than a breach of contract claim. Consequently, the claim for punitive damages in the present case does not require the same level of detail as a breach of contract case. The appellant submits that the general reference to conduct pleaded elsewhere in the statement of claim was sufficient.
(ii) Position of the Respondents
25The respondents submit that the motion judge correctly concluded that the statements attacked by the appellant are not capable of bearing a defamatory meaning. In a defamation action, the statement of claim must identify each alleged defamatory statement specifically, as well as who made the statement, when it was made and to whom. The appellant’s statement of claim did not comply with these requirements.
26With regard to the proposed amended statement of claim, the appellant did not take steps to have it issued, nor did she seek leave to amend the existing statement of claim. As a result, the motion judge did not have jurisdiction to rule on the proposed amended statement of claim. To the extent that he expressed his opinion regarding its contents, this had no legal effect and is thus irrelevant to this appeal.
27The respondents submit that the tort of malicious prosecution is unavailable in the circumstances because it only applies to criminal prosecutions where the proceedings have terminated in the plaintiff’s favour.
28The respondents argue that complaints to the College cannot give rise to a claim for champerty, since they do not constitute litigation where damages are sought. As for the civil proceedings, champerty and maintenance are only actionable if the plaintiff has suffered special damages. Since the civil proceedings against the appellant have not concluded, the appellant has not suffered any damages and this claim is premature.
29The respondents argue that to succeed on a claim of intentional interference with economic relations, a plaintiff must show that the defendant intended to cause loss to the plaintiff as an end in itself or as a means of enriching itself. The appellant’s statement of claim does not satisfy this test and does not identify what “unlawful means” were used by the respondents. In addition, the claim will necessarily require evidence regarding the communications between the respondents and their clients, which are protected by solicitor-client privilege.
30The respondents argue that the motion judge correctly concluded the appellant’s pleadings did not particularize the conduct that she alleged gave rise to an intentional infliction of mental distress claim.
31Regarding the punitive damage claim, the respondents submit that the motion judge correctly concluded that the appellant’s pleading did not identify the facts giving rise to the claim for punitive damages with sufficient particularity. The general reference to “aforesaid conduct” was insufficient.
32Finally, the respondents raise an additional issue. They submit that the appellant’s statement of claim was a collateral attack on ongoing proceedings before the courts and the College. Consequently, they argue that it was open to the motion judge to strike the statement of claim in its entirety as an abuse of process.
ISSUES
33This appeal raises the following issues:
Did the motion judge err in striking the appellant’s claim for defamation?
Did the motion judge err by striking the appellant’s claim for malicious prosecution?
Did the motion judge err by striking the appellant’s claim for champerty and maintenance?
Did the motion judge err by striking the appellant’s claim for intentional interference with economic relations?
Did the motion judge err by striking the appellant’s claim for intentional infliction of mental distress?
Did the motion judge err by striking the appellant’s claim for punitive damages?
Should the claim be dismissed as an abuse of process?
ANALYSIS
(i) General Principles
34Before turning to a review of the causes of action pleaded in this case, it is useful to have regard to three important legal principles that govern on this appeal.
35The first principle is the standard of review. There is no issue between the parties, and I agree, that the motion judge was engaged in a purely legal analysis. Therefore, the standard of review is correctness: Housen v. Nikolaisen, 2002 SCC 33, 2 S.C.R. 235, at para. 36.
36The second principle is the governing test on a motion to strike a pleading under rule 21.01(1)(b) for disclosing no reasonable cause of action. The parameters of the test are well established in the case law. A claim should only be struck under this rule if it is plain and obvious that there is no reasonable prospect it can succeed: Hunt v. Carey Canada Inc., 1990 CanLII 90 (SCC), [1990] 2 S.C.R. 959, at p. 980; Guergis v. Novak, 2013 ONCA 449, 116 O.R. (3d) 280 (C.A.), at para. 34. In undertaking that analysis, the motion judge must assume the allegations of fact in the statement of claim are true, unless they are patently ridiculous or incapable of proof: McCreight v. Canada (Attorney General), 2013 ONCA 483, 116 O.R. (3d) 429, at para. 29. The motion judge must also read the statement of claim as generously as possible, with a view to accommodating any inadequacies in the pleading: R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, [2011] 3 S.C.R. 45, at paras. 17-22.
37Third, the court has discretion under rule 25.11 to strike a pleading that may prejudice or delay the fair trial of an action or that is scandalous, frivolous, vexatious, or an abuse of process.
38With these principles in mind, I turn to an analysis of each of the causes of action asserted in the statement of claim and a consideration of the respondents’ submission that the claim should be struck as an abuse of process.
(ii) Defamation
39In Grant v. Torstar Corp., 2009 SCC 61, [2009] 3 S.C.R. 640, at para. 28, the Supreme Court of Canada held that a plaintiff must prove the following three elements in a defamation action: 1) the defendant made a defamatory statement, in the sense that the impugned words would tend to lower the plaintiff’s reputation in the eyes of a reasonable person; 2) the words in fact referred to the plaintiff; and 3) the words were communicated to at least one person other than the plaintiff.
40A reasonable person in this context is one who is reasonably thoughtful and informed, who would understand the difference between allegations and proof of guilt. Such a person would keep in mind that an accused person is presumed innocent until proven guilty: Guergis, at paras. 38 and 57; Miguna v. Toronto (City) Police Services Board, [2004] O.J. No. 2455 (S.C.), at paras. 4-6, aff’d [2005] O.J. No. 107 (C.A.).
41Courts will only grant a motion by a defendant to strike a pleading on the basis that the statement at issue is incapable of a defamatory meaning in the clearest of cases. If this standard is not met, determination of the issue will be left to the trier of fact at trial: Guergis, at para. 41.
42The statements in issues are as follows:
(i) “There are over 100 former patients of Dr. Frank who contacted Legate & Associates about her treatment. Legate & Associates has issued 58 claims in the Superior Court of Justice to date. Several more cases are under investigation.”
(ii) “It is expected that many more lawsuits will be issued.”
(iii) “… [S]ince releasing the details of lawsuits undertaken on behalf of three women who were patients of Dr. Cathy Frank, over 90 women have come forward.”
(iv) “If you think you or your baby may have a claim against Dr. Frank, please contact Legate & Associates.”
(v) “Legate is pursuing the public review by the Discipline Committee instead of the secretive Complaints Committee process.”
(vi) “… [She] passed all of the exams but when [she] went out to practice, there was a problem … the unfortunate consequence of that, we allege, is that children have been born with disabilities that they wouldn’t have otherwise had.”
(vii) “Over 100 women contacted Legate & Associates about their treatment and that of their babies at the hands of Dr. Frank. Approximately 60 women have issued claims for themselves and several more actions are under investigation for compromised babies, and one has been commenced. These women have made complaints to the CPSO as far back as 2006 about Dr. Frank.”
43In my view, the motion judge correctly concluded that the seven impugned statements in the appellant’s statement of claim were clearly incapable of bearing a defamatory meaning.
44Statements (i) to (iv) and (vii), quoted above, were purely informational and did not comment in any way on the merits of the ongoing litigation. The comments are neutral in their description of the appellant. References to the numerous women who have come forward are supported by the appellant’s own pleading, which indicates that 58 actions have been commenced against her. No reasonable person, who is taken to understand the difference between allegations and proof of guilt, could interpret these statements in the manner suggested by the appellant (i.e. as suggestive of her being negligent and/or incompetent as a physician).
45The appellant effectively seeks to prohibit law firms from describing allegations that form the basis of potential or ongoing claims. If this type of statement amounted to defamation, no law firm in the province could ever solicit clients because they could not provide the necessary information for people to determine if they should consult a lawyer about a potential claim. The class action process, for example, would be effectively eviscerated if lawyers were restricted in their communications in the manner urged upon us by the appellant.
46Statement (v), which describes the pursuit of a public review process rather than a private review process before the College, does not even mention the appellant. Rather, it simply refers to the respondents’ preferred course of action.
47Statement (vi) comes from an article that appeared on the CTV News website. The appellant’s pleading and factum suggest that this statement is one sentence. In fact, this is a combination of two sentences. It also omits a number of other sentences that are found in between.
48Allegedly defamatory comments must be read in context: Guergis at para. 65; Mantini v. Smith Lyons LLP (2003), 2003 CanLII 22736 (ON CA), 64 O.R. (3d) 516 (C.A.), at para. 14, leave to appeal to S.C.C. refused, [2003] S.C.C.A. No. 344. Context is important in determining the meaning of words and whether they are capable of being defamatory. Reading impugned comments in isolation is unfair and is of no assistance to the court in its analysis. This problem is exacerbated where, as here, the appellant has combined portions of different comments into one statement.
49The first portion of statement (vi) reads as follows in the appellant’s statement of claim: “[She] passed all of the exams but when [she] went out to practice, there was a problem.” The appellant misquotes this statement in her pleading. The correct wording, found in the CTV news article, uses the pronoun “you” instead of “she”. When this statement is corrected and read in context, it is clear that the respondent Barbara Legate was making a general comment about why the College may impose restrictions on a physician’s practice. To the extent that the comment can be taken to refer to the appellant specifically, it is again a purely factual statement about the restrictions imposed on her medical licence by the College.
50The second part of the statement, which is found four paragraphs below the first part of the impugned statement in the original article, reads as follows in the appellant’s pleading: “… the unfortunate consequence of that, we allege, is that children have been born with disabilities that they wouldn’t otherwise have had.” The words “of that” do not appear in the original quote, but appear to have been added by the appellant when she combined the two sentences that form statement (vi). Although not pleaded, the appellant also now takes issue with the first part of this sentence, which reads: “She didn’t take the steps we’d expect a physician to take”. The appellant invites us to parse this statement to conclude that the phrase “we allege” modifies only the second part of the sentence and not the first part. In other words, the phrase “we allege” relates to the consequence of the problem but does not qualify the existence of the problem.
51Leaving aside the fact that the first part of the sentence, which is now the focal point of the appellant’s complaint, is not pleaded, I am of the view that the statement could not be interpreted as defamatory. A reasonable person who read the entirety of the sentence in issue would understand that Ms. Legate was merely describing the nature of the allegation against the appellant. This includes both the existence and consequences of the alleged problem. A reasonable person would not parse the statement in the manner suggested by the appellant.
52The appellant also made various general references in her statement of claim to false and defamatory statements by the respondents. Those statements were not detailed or identified in her pleading. To the extent that they are different than the seven statements above, they cannot support a defamation claim because the appellant failed to plead the exact statements complained of and the details of who made them, when they were made and to whom: Khan v. Canada (A.G.), 2009 CanLII 7090 (ON SC), at para. 29, aff’d 2009 ONCA 737, leave to appeal to S.C.C. refused, [2009] S.C.C.A. No. 516.
53For reasons that are not clear, after striking the statement of claim in its entirety, and over the objection of counsel for the respondents, the motion judge went on to provide his “opinion” on whether the proposed amended statement of claim remedied the defects in the now struck statement of claim. He did not order any relief with respect to the amended statement of claim and did not, as noted above, make any order regarding whether the appellant should be granted leave to amend her claim.
54I agree with the submission of the respondents that since the appellant did not seek leave to amend her claim or issue the proposed amended statement of claim, and given that the motion judge did not order any relief with respect to it, his comments had no legal effect.
55I do note, however, that the motion judge’s conclusion that two of the allegedly defamatory statements in the proposed amended statement of claim were incapable of bearing a defamatory meaning despite the fact that they “could be interpreted in one way as commenting on the merits of the case and of being defamatory”, appears to be an error of law. As this court made clear in Guergis, at para. 73, where the range of possible meanings for a statement includes one that is defamatory, it is not a clear case enabling the pleading to be struck. In fairness to the motion judge, he went on to suggest that any claim based on these statements could be struck as an abuse of process. In any event, his statements regarding the proposed amended statement of claim were clearly obiter and had no impact on the final outcome of the motion.
(iii) Malicious Prosecution
56The elements of the tort of malicious prosecution were summarized by the Supreme Court of Canada in Miazga v. Kvello Estate, 2009 SCC 51, [2009] 3 S.C.R. 339, at paras. 53-56, as follows: 1) a proceeding initiated by the defendant; 2) a proceeding terminated in favour of the plaintiff; 3) the defendant had no reasonable and probable cause to initiate the proceeding; and 4) the defendant acted with malice.
57As a preliminary matter, there is an issue between the parties regarding whether malicious prosecution applies to civil actions and disciplinary proceedings. Traditionally, this tort was limited to criminal prosecutions and petitions to wind up a public company or a petition in bankruptcy. However, one Divisional Court case, Stoffman v. Veterinary Association (Ontario) (1990), 1990 CanLII 6925 (ON SC), 73 O.R. (2d) 737, suggests that the tort may apply to disciplinary proceedings. It is unnecessary to determine this issue because the pleading of malicious prosecution in this case can and should be struck on numerous other grounds.
58First, with respect to the second element, a careful review of the statement of claim discloses that it does not contain a definitive statement that the proceedings have terminated in favour of the plaintiff. With respect to two of the civil actions, the appellant pleads that they are ongoing. The closest the appellant comes to an unequivocal statement are her assertions that the disciplinary proceedings “have, or will, terminate in her favour” and that the civil actions “are bound to fail.” I need not comment on the propriety of the motion judge’s reliance on the statement made by counsel for the respondents on the present stage of the actions and complaints. The fact is that the appellant failed to unequivocally plead that all of the various proceedings, or any of them, had been terminated in her favour. Therefore, there was no error in the motion judge’s finding that this element of the tort was not properly pleaded.
59Second, the crucial element of malice was also not properly pleaded. There was no allegation of malice at all regarding the civil actions. With respect to the complaints to the College, it was pleaded only as one potential, alternative motivation. As the Supreme Court of Canada found in Miazga, at para. 56, malice is the key element in striking the balance this tort was designed to maintain between the effective administration of justice and the need to compensate individuals who have been wrongly prosecuted. The appellant’s statement of claim does not adequately plead this element.
60Third, s. 36(3) of the Regulated Health Professions Act, 1991, S.O. 1991, c. 18, provides:
No record of a proceeding under this Act, a health profession Act or the Drug and Pharmacies Regulation Act, no report, document or thing prepared for or statement given at such a proceeding and no order or decision made in such a proceeding is admissible in a civil proceeding other than a proceeding under this Act, a health profession Act or the Drug and Pharmacies Regulation Act or a proceeding relating to an order under section 11.1 or 11.2 of the Ontario Drug Benefit Act. 1991, c. 18, s. 36 (3); 1996, c. 1, Sched. G, s. 27 (2).
61The effect of this provision is that although reference to a complaint to the College having been made may be proven at trial, nothing from the record of a complaint – from the initial statement given by a complainant to the final order made by the tribunal – is admissible in a civil action, including an action for malicious prosecution. The practical result is that actions for malicious prosecution based on complaints to the College are effectively barred: Conroy v. College of Physicians & Surgeons of Ontario, 2011 ONSC 324, 329 D.L.R. (4th) 689, at paras. 51-55, aff’d 2011 ONCA 517, leave to appeal to S.C.C. refused, 432 N.R. 388; Montgomery v. Seiden, 2012 ONSC 6235, at paras. 41-42; Forget v. Sutherland (2000), 2000 CanLII 5761 (ON CA), 188 D.L.R. (4th) 296 (Ont. C.A.), at paras. 26-39, leave to appeal to S.C.C. refused, [2000] S.C.C.A. No. 531.
62For these reasons, I am of the view that the motion judge made no error in striking the malicious prosecution claim.
(iv) Champerty and Maintenance
63The entirety of the plaintiff’s pleading in this regard is contained in the following two paragraphs from the statement of claim:
[20] The Plaintiff pleads that the assistance and encouragement of the Defendants provided to third parties on whose behalf the Complainants were submitted and actions commenced, for no lawful reason, constitutes maintenance and champerty. The Defendants have no motive or lawful reason to encourage the Complaints or actions commenced on behalf of third parties, and have entered into agreements with these third parties to share in the proceeds, if any of the litigation.
[21] As a result the Plaintiff has suffered, and will continue to suffer, damages as a result of the Defendants’ actions, the full extent of which will be provided prior to trial.
64In McIntyre Estate v. Ontario (Attorney General) (2002), 2002 CanLII 45046 (ON CA), 61 O.R. (3d) 257 (C.A.), O’Connor A.C.J.O. noted, at para. 25, that the torts of champerty and maintenance continue to be actionable upon proof of special damage. Associate Chief Justice O’Connor undertook a thorough review of the development of these torts in Canada and England. He discerned four general principles from this review of the common law, at para. 34:
− Champerty is a subspecies of maintenance. Without maintenance, there can be no champerty.
− For there to be maintenance, the person allegedly maintaining an action or proceeding must have an improper motive, which motive may include, but is not limited to, officious intermeddling or stirring up strife. There can be no maintenance if the alleged maintainer has a justifying motive or excuse.
− The type of conduct that has been found to constitute champerty and maintenance has evolved over time so as to keep in step with the fundamental aim of protecting the administration of justice from abuse.
− When the courts have had regard to statutes such as the Champerty Act and the Statute Concerning Conspirators, they have not interpreted those statutes as cutting down or restricting the elements that were otherwise considered necessary to establish champerty and maintenance at common law.
65With these principles in mind, I turn to the champerty and maintenance pleading in the present action.
66I disagree with the motion’s judge’s conclusion that the pleading is deficient because it does not specifically allege that the respondents improperly stirred up litigation that would not otherwise have been pursued or that they brought baseless claims as a form of intimidation. Such an explicit plea is not necessary as it is possible to ascertain, with a liberal consideration of the pleading, that the respondents are alleged to have encouraged litigation with improper motives.
67Notwithstanding the foregoing, I conclude that the motion judge did not err in striking the champerty and maintenance claim.
68First, it is not possible to make a claim for champerty, which requires the maintainer to share in the profits of the litigation, with respect to complaints made to the College. Damages cannot be awarded in those proceedings. Consequently, there are no profits to share. I am also aware of no case law, and the appellant has not provided the court with any, where a maintenance claim has been made regarding complaints to a regulatory body.
69Second, I also agree with the submission of the respondents that the claim was premature, since none of the underlying actions or complaints had been concluded at the time the claim was issued.
70Other than a passing reference in Lorch v. McHale (2008), 2008 CanLII 35685 (ON SC), 92 O.R. (3d) 305 (S.C.), at para. 34, aff’d 2009 ONCA 161, there is no Ontario case law that addresses the issue of whether a claim for champerty and maintenance can be asserted prior to the conclusion of the underlying action.
71In Oldford v. Canadian Broadcasting Corp., 2004 NSSC 105, 223 N.S.R. (2d) 380, Coughlan J. dealt with the issue squarely. He concluded that a claim for maintenance is not actionable without proof of actual loss. Actual loss will not be incurred if the maintainer is successful in the underlying action. On that basis, he struck a claim for champerty and maintenance regarding an underlying claim that had not been concluded.
72Justice Coughlan thoroughly reviewed the English authorities that address this point. He placed considerable reliance on the reasoning of Lord Shaw and Lord Phillimore in Neville v. London Newspapers Ltd., [1919] A.C. 368 (H.L.). While Coughlan J. recognized that the two majority decisions in Neville were divided on the issue of whether unsuccessful litigants can later make a claim for champerty and maintenance, he ultimately concluded that they could not.
73I agree with Coughlan J.’s analysis on this issue. There can be no champerty or maintenance if the maintainer has a justifying motive or excuse. As stated by Lord Phillimore in Neville, at p. 433, “the justification or excuse is to be found in the righteousness of the suit and the proof of its righteousness is its success.” It follows that the lawfulness of a defendant’s position in maintaining litigation can only be determined once the litigation has concluded.
74As noted in McIntyre at para. 47, the public policy animating the law of champerty and maintenance has always been to protect the administration of justice from abuse. In those instances where our judicial system is being abused, it is only fair that the aggrieved party is entitled to compensation. But where the underlying action or defence is a valid and legitimate use of the court system, there can be no damages based on these causes of action.
75An action for champerty and maintenance that precedes the conclusion of the underlying action puts the cart squarely before the horse. Moreover, the premature use of these torts is abusive to the administration of justice because it serves to obstruct the prosecution of legitimate claims and defeat the assertion of valid defences. This, of course, is contrary to the public policy rationale for these torts.
(v) Intentional Interference with Economic Relations
76The gravamen of the appellant’s claim for intentional interference with economic relations is that the respondents improperly and maliciously intended to interfere with her practice and ensure that she could not work as a physician. The appellant relies upon the fact that the respondents have commenced at least 58 civil actions against her. She also pleads that through advertisements, statements and misrepresentations, the respondents solicited third parties and made various misrepresentations to induce them to commence unmeritorious civil actions and complaints to the College regarding the appellant.
77The appellant pleads that these actions were intended to “injure [her], or that the unlawful or illegal actions of the Defendants were directed against [her].” The appellant pleads that but for the advertisements, statements and misrepresentations, the legal proceedings against her, or a vast majority of them, would not have been commenced. Finally, the appellant pleads that she has suffered economic loss as a consequence of this conduct by the respondents.
78The motion judge struck this portion of the claim on the grounds that the allegations are unspecified and are inconsistent with the Supreme Court of Canada’s narrow definition of this tort in A.I. Enterprises Ltd. v. Bram Enterprises Ltd., 2014 SCC 12, [2014] 1 S.C.R. 177. The motion judge also found that, to the extent that the pleadings rely on confidential communications between the respondents and their clients, the appellant relied on inadmissible facts. Consequently, the claim should be struck pursuant to rule 25.11.
79In A.I. Enterprises, Cromwell J. extensively reviewed the history and elements of intentional interference with economic relations, which is also referred to as, among other names, the “unlawful means tort”. He traced the development of the tort and considered the state of the law in various common law jurisdictions. Justice Cromwell concluded that this tort should be restricted to three-party situations in which the defendant commits an unlawful act against a third party and intentionally causes economic harm to the plaintiff through that act. Unlawful conduct is limited to conduct that is actionable by the third party or would have been actionable if the third party suffered loss. The defendant must intend to cause injury to the plaintiff as an end in itself or as a means of achieving an ulterior motive (e.g. enriching itself): A.I. Enterprises, at paras. 5 and 95.
80For the following reasons, I agree with the conclusion of the motion judge that the claim for damages for intentional interference with economic relations should be struck because it was not pleaded properly.
81First, the appellant’s plea is equivocal, as it states that the respondents’ intention was to injure or the actions were directed against the plaintiff. This pleading does not meet the narrow definition of the tort adopted by the Supreme Court of Canada. It is not enough to plead that the actions of respondents were directed at the appellant. The respondents must have intended to injure her.
82Second, the unlawful means alleged are not clear. Whatever they may be, they would have to be actionable by the appellant’s patients against the respondents. Defamatory statements about the appellant made in private or in advertisements or solicitations would not be actionable by the patients. It is possible that misrepresentations to the clients could be actionable, but the alleged misrepresentations are never specified or described in any level of detail in the statement of claim.
83Third, and in any event, I also agree with the finding of the motion judge that in order to understand the nature of the misrepresentations and whether the clients relied upon them, the appellant would need to lead evidence of the privileged communications between the respondents and their clients. Consequently, this claim was properly struck under rule 25.11 as it relies on inadmissible evidence.
(vi) Intentional Infliction of Mental Distress
84I agree with the conclusion of the motion judge that the brief reference to this tort in the pleading was so vague that a defendant who read it would have no idea what conduct was being alleged against them. There were no specified allegations in the appellant’s pleadings. I see no error in the motion judge’s decision to strike this part of the claim.
(vii) Punitive Damages
85The motion judge, relying upon Research Capital, struck the claim for punitive damages on the ground that it was pleaded in a conclusory manner with insufficient particulars. The appellant’s contention that the motion judge erred in law by relying on that case because it involved a breach of contract is untenable. This case was cited for the general proposition that claims for punitive damages must be pleaded with some degree of particularity. The fact that the case involved a breach of contract does not make it distinguishable on this rather uncontroversial legal point.
86The wording of the claim for punitive damages in the present case was pure boilerplate and contrary to the admonition of Binnie J. in the seminal case Whitten v. Pilot Insurance Co., 2002 SCC 18, [2002] 1 S.C.R. 595, at para. 87, over ten years ago, that claims for punitive damages must be pleaded with particularity and that boilerplate language is conclusory rather than explanatory. It is not sufficient, as the appellant submits, to simply reference the “aforesaid conduct” described in the remainder of the pleading to support a claim for punitive damages.
87I see no basis to interfere with the motion judge’s finding that the claim for punitive damages should be struck.
(viii) Abuse of Process
88Even if the statement of claim had properly pleaded tenable causes of action, it should have been struck as an abuse of process.
89In my view, the statement of claim, which I hasten to add was not drafted by counsel on the appeal, is an abuse of process. It is a collateral attack on the civil lawsuits against the appellant and the complaints to the College. It appears to be designed to frustrate those processes and deny the appellant’s patients redress before the courts and the College. I reach this conclusion for the following reasons.
90First, the appellant asserted causes of action (i.e. malicious prosecution and champerty and maintenance) that were clearly premature as no underlying action or complaint had been resolved, let alone in her favour. She attempted to evade this issue by asserting in the statement of claim that proceedings were or could in the future be decided in her favour. She then attempted to rely on this statement to argue that the motion judge must accept that she had met this part of the test for a malicious prosecution claim.
91Second, the appellant’s malicious prosecution claim was willfully blind to the clearly established case law and s. 36(3) of the Regulated Health Professions Act, 1991, which make it clear that an action for malicious prosecution was unavailable in the circumstances.
92Third, the intentional interference with economic relations claim necessarily involved the disclosure of privileged solicitor and client communications related to ongoing litigation against the appellant. It is hard to imagine that the appellant in good faith actually believed that this claim could proceed while the complaints against her were outstanding.
93Fourth, the assertion of multiple poorly pleaded causes of action was a transparent effort to dress up a libel claim that had no chance of success.
94For these reasons, I find that it would be an abuse of the court’s process to permit the appellant’s claim to continue.
DISPOSITION
95For the foregoing reasons, I would dismiss the appeal. The respondents, as the successful parties, are entitled to their costs of the appeal, which I would fix at $12,500.
Released: September 18, 2015 “PL”
“C. W. Hourigan J.A.”
“I agree P. Lauwers J.A.”
“I agree G. Pardu J.A.”
