Zhong v. Wu, 2020 ONSC 7763

CITATION: Zhong v. Wu, 2020 ONSC 7763

DIVISIONAL COURT FILE NO.: 004/20 DATE: 20201214

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

BETWEEN:

Jian Wu

Appellant

(Respondent)

– and –

Xinsheng Zhong

Respondent

(Moving party)

Jian Wu, representing himself

Heng (Pandora) Du, for the Moving Party

HEARD at Toronto by videoconference: September 2, 2020

Favreau J.

Overview

1In a judgment dated December 19, 2020, Penny J. granted a motion for summary judgment in favour of the plaintiff, Xinsheng Zhong. The motion judge found that the defendant, Jian Wu, defamed Mr. Zhong through a series of internet posts on WeChat. He ordered Mr. Wu to pay Mr. Zhong $35,000 in damages and awarded full indemnity costs in the amount of $15,414.90. He also granted a permanent injunction requiring Mr. Wu to stop defaming Mr. Zhong.

2Mr. Wu commenced an appeal of the motion judge’s order on January 2, 2020.

3Mr. Zhong has brought a motion to dismiss the appeal on the basis that it is devoid of any merit or, alternatively, for an order for security for costs.

4For the reasons below, I am not prepared to quash the appeal but I make an order for security for costs.

Background

Statements made by Mr. Wu about Mr. Zhong

5Mr. Zhong is a Canadian citizen who immigrated to Canada over 30 years ago. He is married to Haiyan Li. Mr. Zhong was a medical doctor in China. In Canada, he has worked as a social worker, and is the chief executive officer of the Toronto Community & Culture Centre and co-chair of the National Congress of Chinese Canadians. Mr. Zhong has received recognition and various honours for his contributions to the Toronto Chinese community.

6Mr. Wu is a Toronto resident. He is an active member of the Toronto Chinese community. He is a self-employed contractor.

7Mr. Wu is an active participant on WeChat. WeChat is a social media platform operated by a Chinese company. The motion judge found that WeChat “is a multipurpose messaging, social media and payment application which is extremely popular among Chinese speaking mobile phone users”.

8The evidence on the motion was that, between February and May 2019, Mr. Wu posted a series of messages on WeChat about Mr. Zhong claiming, amongst other matters, that Mr. Zhong defrauded various levels of government, sexually assaulted women and has blackmailed and extorted various members of the Toronto Chinese community.

Summary judgment proceedings and motion judge’s decision

9After giving the required notice to Mr. Wu, on April 15, 2019, Mr. Zhong commenced a defamation action.

10Mr. Wu was originally represented by counsel. While he was represented by counsel, Mr. Wu consented to an interim injunction order that prohibited him from publishing libelous statements about Mr. Zhong and required that existing posts be removed from WeChat. Mr. Wu served a statement of defence after he became self-represented. The statement of defence admits that Mr. Wu made statements about Mr. Zhong on WeChat, and states that he did so to “safeguard the public interest”.

11After the statement of defence was served, Mr. Zhong brought a motion for summary judgment. Mr. Zhong and his wife swore affidavits in support of the motion.

12Mr. Wu did not file any affidavit evidence in response to the motion.

13The hearing took place on December 3, 2019. At the hearing, Mr. Wu provided the court with various unsworn documents he had obtained from his previous lawyers, including a list of potential witnesses they had tried to contact.

14The motion judge released his decision on December 9, 2020.

15In his decision, the motion judge reviewed the statements Mr. Wu made about Mr. Zhong on WeChat. He found that the statements were about Mr. Zhong, that they were published and that Mr. Wu made them.

16The motion judge went on to find that the statements are defamatory:

Here, many of the words complained of are, on their face, defamatory. This includes the allegations of fraud, embezzlement, bribery, corruption, sexual assault and being a sexual predator. Other statements take their defamatory sting from the context. These include allegations that Mr. Zhong owns many luxury homes and cars and that he is womanizer, has strong sexual urges and is promiscuous. These allegations feed off, and feed, the allegations of financial and sexual misconduct. I have no hesitation in concluding that the words complained of are defamatory.

17The motion judge then considered the defences that may be available to Mr. Wu in the context of a claim of defamation.

18Based on the evidence of Mr. Zhong and Ms. Li, the motion judge found that the statements made by Mr. Wu about Mr. Zhong on WeChat were not justified. He noted that Mr. Wu “presented no evidence whatsoever that anything he said about Mr. Zhong or Ms. Li, is true” and he found that “Mr. Wu claimed that he had witnesses but admitted that no one was prepared to testify”.

19The motion judge also found that the defences of fair comment and qualified privilege, although they were not explicitly pleaded, were nevertheless not made out.

20The defence of fair comment was not available in part because Mr. Wu admitted that he did not know Mr. Zhong and had never spoken to him. The motion judge found that the statements posted on WeChat were “rumour and innuendo from other, unidentified, people” and Mr. Wu “made no effort to investigate or substantiate them”. In any event, the statements were not comments and they were not matters of public interest.

21With respect to the defence of qualified privilege, Mr. Wu had no duty to publish the statements and the recipients on WeChat had no corresponding interest in receiving the statements. In any event, the statements “were plainly made with malicious intent or were published with such reckless disregard of the truth as to constitute malice”. The motion judge also found that the statements themselves demonstrated that Mr. Wu knew that they would be hurtful and upsetting to Mr. Zhong and his wife.

22The motion judge went on to determine that, given his findings referred to above, there was no genuine issue for trial.

23He then addressed Mr. Zhong’s claim for damages. He considered that, while Mr. Zhong did not have evidence of a pecuniary loss or medical evidence of a psychological injury, damages for defamation are presumed. Given Mr. Zhong’s prominence in the Toronto Chinese community and the nature of the defamatory statements, the motion judge awarded $35,000 in general damages. He declined to award punitive damages, finding that, while Mr. Wu acted with malice, his actions were not so egregious that they warranted punitive damages.

24The motion judge concluded by ordering that Mr. Wu pay Mr. Zhong $35,000 in damages and $15,414.90 in costs on a full indemnity basis, and that Mr. Wu is “permanently prohibited from publishing defamatory statements regarding Mr. Zhong, on the Internet or by any other means”.

Appeal to this Court

25Mr. Wu commenced an appeal of the motion judge’s judgment to this Court on January 2, 2020. In his notice of appeal, Mr. Wu asserts that he did not have sufficient notice of the motion for summary judgement and that he did not have time to file responding evidence. He also claims that a trial is required in this case so that he can call witnesses who will testify about the truth of the statements the motion judge found were defamatory.

26In his certificate respecting evidence, Mr. Wu states that he intends to present the “oral evidence” of three named individuals.

Proceedings on this motion

27There were two telephone case conferences that dealt with the scheduling of this motion. The motion was originally scheduled for July 22, 2020. That date was adjourned to September 2, 2020 because Mr. Wu had not yet obtained the transcript from the hearing before the motion judge, which he said he needed in order to respond to the motion.

28In advance of the motion, Mr. Wu did not file any affidavit evidence or a factum. Rather, he relied on the transcript from the summary judgment motion and the documents from his previous lawyers he had provided to the court on the motion for summary judgment.

Continued defamation

29Mr. Zhong’s lawyer has provided evidence that Mr. Wu continues to make defamatory statements on WeChat about Mr. Zhong despite the order made by the motion judge.

Analysis

30While the notice of motion seeks to quash the appeal on the basis that it is devoid of merit, Mr. Zhong’s factum and his counsel’s argument at the hearing of the motion focused on the request for security for costs. As set out below, while I am not prepared to quash the appeal, I find that this is an appropriate case for security for costs.

Whether the appeal should be quashed as devoid of any merit

31Section 134(3) of the Courts of Justice Act, R.S.O 1990, c. C.43, gives a court to which an appeal is brought the power to quash the appeal. The test for quashing an appeal is whether it is manifestly devoid of merit: Schmidt v. Toronto Dominion Bank (1995), 1995 3502 (ON CA), 24 O.R. (3d) 1 (C.A.), at para. 6. However, in Schmidt, the Court of Appeal held that this power is to be exercised sparingly because it "is very difficult, in most cases, to reach the conclusion that an appeal is devoid of merit without hearing the entire appeal".

32In this case, as reviewed below, I see very little merit to Mr. Wu’s appeal. However, in order to reach the conclusion that it is manifestly devoid of merit, I would have to embark on an analysis that would require me to essentially decide the issues raised on appeal. This is not a case where the court lacks jurisdiction over the appeal or where Mr. Wu raises untenable grounds of appeal. Rather, he essentially raises arguments of procedural fairness. In order to decide the issues, I would have to review and consider the evidence over how the motion for summary judgment was scheduled and the transcript from the motion in the same manner as a panel would have to review it on the hearing of the appeal. Given the Court of Appeal’s warning that this is not the role of the court on a motion to quash an appeal and that Mr. Zhong’s counsel did not press the issue, I am not granting an order quashing the appeal.

33However, as set out below, I am satisfied that Mr. Zhong is entitled to an order for security for costs.

Whether an order for security for costs is warranted

34Rule 61.06 of the Rules of Civil Procedure gives the Court the power to order security for costs on an appeal:

61.06 (1) In an appeal where it appears that,

(a) there is good reason to believe that the appeal is frivolous and vexatious and that the appellant has insufficient assets in Ontario to pay the costs of the appeal;

(b) an order for security for costs could be made against the appellant under rule 56.01; or

(c) for other good reason, security for costs should be ordered,

a judge of the appellate court, on motion by the respondent, may make such order for security for costs of the proceeding and of the appeal as is just.

(2) If an appellant fails to comply with an order under subrule (1), a judge of the appellate court on motion may dismiss the appeal.

35In this case, Mr. Zhong’s lawyer relies on Rule 61.06(1)(a) to argue that the appeal is frivolous and vexatious and that Mr. Wu has insufficient assets in Ontario. In order to succeed on the motion, Mr. Zhong must meet both prongs of the test: 798839 Ontario Ltd. v. Platt, [2014] O.J. No. 6077 (C.A.), at para. 36.

The appeal appears to be frivolous and vexatious

36I am satisfied that the appeal appears to be frivolous and vexatious.

37In 798839 Ontario Ltd., at para. 27, the Court of Appeal emphasized that I only need to find the appeal appears to be frivolous and vexatious, and not that it is frivolous and vexatious. At paras. 38-39 of that decision the Court identified the indicia of a frivolous and vexatious appeal as including an appeal that appears to be devoid of merit and the presence of an oblique motive such as the harassment or embarrassment of the respondent.

38In this case, I am satisfied that the appeal appears to have no merit. Mr. Wu admits making the defamatory statements. His only defence to the claim seems to be his belief that the allegations are true. By his own admission, he has no first hand knowledge of Mr. Zhong’s alleged conduct. He purports to rely on information he received from third parties, but he admitted on the motion for summary judgment that none of these people are prepared to testify.

39His stated grounds of appeal are that he was not aware of the motion date and therefore did not have sufficient time to bring forward his evidence. He also asserts that he should be allowed to present his evidence at trial. Based on my review of the evidence put forward on Mr. Zhong’s behalf about how the motion was scheduled and the transcript from the hearing before the motion judge, I see very little merit to these assertions. The motion was scheduled with Mr. Wu’s knowledge and he presented no evidence at the hearing of the motion that any witnesses would be prepared to testify in support of the statements he has made about Mr. Zhong.

40I am also satisfied that Mr. Wu seems to be pursuing this appeal with the ulterior motive of continuing his campaign against Mr. Zhong. It is hard to understand what has motivated Mr. Wu’s animus toward Mr. Zhong, especially since the two men do not know each other. However, despite the injunction order which is not stayed pending appeal, Mr. Wu has continued to post statements about Mr. Zhong similar to those which the motion judge found were defamatory. The statements have arguably escalated, now including negative comments about Mr. Zhong’s lawyer and about Mr. Zhong being afraid of this appeal

41In the circumstances, I am satisfied that it appears that the appeal is frivolous and vexatious. It appears to be devoid of any merit and it appears to be motivated by Mr. Wu’s ongoing animus toward Mr. Zhong.

Mr. Wu has insufficient assets

42Based on Mr. Zhong’s evidence on the motion, I am satisfied that Mr. Wu has insufficient assets in Ontario to satisfy a costs order.

43In his affidavit in support of the motion, Mr. Zhong states that he has done a title search of Mr. Wu’s residence. He has found that it is a rental property and that Mr. Wu therefore does not appear to own any property. In addition, Mr. Wu is a self-employed landscaper, which means that his business is cash based and it would thereby be difficult to collect costs from him.

44Mr. Wu put forward no evidence to contradict Mr. Zhong’s evidence, nor has he put forward any evidence that an order for security for costs will prevent him from moving forward with the appeal.

45In the absence of any evidence from Mr. Wu, I accept Mr. Zhong’s evidence that it appears that Mr. Wu does not have assets in Ontario to satisfy a costs order.

It is just to make an order for security for costs in this case

46The courts have held that the overall consideration in deciding whether to make an order for security for costs is whether it is just to do so in the circumstances of the particular case: Yaiguaje v. Chevron Corporation, 2017 ONCA 827, at para. 23.

47In my view, in this case, there is nothing unjust about requiring Mr. Wu to post security for costs. He has waged a relentless campaign against Mr. Zhong. He has continued to breach the order made by the motion judge requiring him to stop making defamatory statements about Mr. Zhong. While he continues to claim that his allegations against Mr. Zhong are true, he has failed to put forward a shred of evidence to support them.

48In the circumstances, if Mr. Wu is to be permitted to pursue his appeal, fairness requires that he pay security for costs. It appears that his appeal is frivolous and vexatious and Mr. Zhong should not be subjected to further court proceedings without the chance that he may recover at least a portion of his legal costs.

Quantum and conditions on the order

49Originally, Mr. Zhong sought $50,000 as security for costs. This was meant to reflect the damages and costs he was awarded on the motion for summary judgment. However, security for costs is not meant to be security for an award of damages. Rather, it is meant to be security for the legal costs. From the case law, it appears that this includes the costs ordered in the proceeding under appeal and the costs that may be incurred on the appeal: Trillium Motor World Ltd. v. General Motors of Canada Limited, 2016 ONCA 702, at para.17; and Groia & Co. Professional Corp. v. Cardillo, 2019 ONCA 165, at para. 36.

50In this case, I find that security for costs in the amount of $20,000 is fair and reasonable in the circumstances of this case. This amount takes account of the costs awarded to Mr. Zhong on the motion for summary judgment and the costs to be awarded to Mr. Zhong if the appeal is dismissed.

Conclusion

51In conclusion, I make the following order:

a. the motion for an order for security for costs is granted;

b. Mr. Wu is to pay $20,000 as security for costs into court by no later than January 15, 2021;

c. If Mr. Wu fails to pay this amount, Mr. Zhong can bring a motion to this Court to to dismiss the appeal, which is to be brought to my attention;

d. If Mr. Wu does pay this amount, the parties are to request a case conference with me for the purpose of setting a schedule for the appeal, which is to be scheduled on an expedited basis; and

e. Mr. Zhong is entitled to costs of this motion in the amount of $7,500, which are to be paid within 30 days of today’s date.

52Mr. Zhong is not required to obtain Mr. Wu’s consent to the form of the order. The draft order can be sent to the Court with a request that it be directed to my attention for signature.

53Before concluding, I remind Mr. Wu that the order prohibiting him from making defamatory statements about Mr. Zhong is still in effect. While Mr. Zhong did not bring a motion for contempt, Mr. Wu’s continued violation of the injunction order may certainly warrant contempt proceedings in the future.

___________________________ Favreau J.

Released: December 14, 2020

CITATION: Zhong v. Wu, 2020 ONSC 7763

DIVISIONAL COURT FILE NO.: 004/20 DATE: 20201214

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

BETWEEN:

Jian Wu

Appellant

(Respondent)

– and –

Xinsheng Zhong

Respondent

(Moving party)