Bondfield Construction Company Limited v. The Globe and Mail Inc. et al.
Indexed as: Bondfield Construction Company Ltd. v. Globe and Mail Inc.
Ontario Reports Court of Appeal for Ontario
Doherty, Pardu and Nordheimer JJ.A.
March 4, 2019
144 O.R. (3d) 291 | 2019 ONCA 166
Case Summary
Civil procedure — Summary dismissal of action — Motion judge dismissing plaintiff's defamation action under s. 137.1 of Courts of Justice Act — Motion judge erring in placing onus on plaintiff under s. 137.1(4)(a)(ii) of Courts of Justice Act to show that defendant had "no valid defence whatsoever" — Plaintiff only required to show that reasonable trier could conclude that defendant did not have valid defence — Plaintiff meeting its onus to show that reasonable trier could reject defendant's defences of fair comment and responsible communication — Public interest balancing under s. 137.1(4)(b) of Courts of Justice Act favouring plaintiff — Courts of Justice Act, R.S.O. 1990, c. C.43, s. 137.1.
The defendants published a series of newspaper articles about the plaintiff's successful bid on a $300 million contract to build a new critical care centre at a Toronto hospital. The plaintiff sued the defendants for damages for defamation, claiming that they falsely alleged that the plaintiff obtained the contract corruptly. The defendants pleaded the defences of fair comment and responsible communication. The defendant moved under s. 137.1 of the Courts of Justice Act ("CJA") to dismiss the action on the basis that it was brought to silence them on matters of significant public importance. The motion was granted. The plaintiff appealed.
Held, the appeal should be allowed.
The motion judge erred in placing the onus on the plaintiff under s. 137.1(4)(a)(ii) of the CJA to show that the defendants had "no valid defence whatsoever". The onus on the plaintiff was significantly less onerous. The plaintiff was required to show that a reasonable trier could conclude that the defendants did not have a valid defence. The plaintiff could meet that onus if it showed that a reasonable trier could reject all of the various defences put in play by the defendants. The plaintiff had met its onus to show that a reasonable trier could reject the defendants' defences of fair comment and responsible communication.
The public interest balancing under s. 137.1(4)(b) of the CJA favoured the plaintiff. There was no history of the plaintiff using litigation or the threat of litigation to silence critics, no financial or other power imbalance that favoured the plaintiff over the defendants, and no suggestion of any punitive or retributory purpose motivating the lawsuit. The plaintiff had produced evidence that it had lost contracts, potential construction partners and potential funding from lenders as a result of the impugned articles. There was also nothing in the record that could reasonably suggest that the defendants were motivated by anything other than a desire to inform the public about the facts that their investigation had revealed. There were powerful arguments to be made on both sides of the public interest balancing required in s. 137.1(4)(b). In the end, this was a case in which the plaintiff had a legitimate argument that it had been defamed and had suffered significant damages as a result of the articles. The defendants had legitimate arguments, both that the content was not defamatory and that it had defences to any parts that were defamatory. The action involved a genuine controversy and should be tried on its merits.
Cases Referred To
Applied:
Other cases referred to:
- Able Translations Ltd. v. Express International Translations Inc., 2018 ONCA 690
- Armstrong v. Corus Entertainment Inc., 2018 ONCA 689
- Grant v. Torstar Corp., 2009 SCC 61
- Platnick v. Bent, 2018 ONCA 687
Statutes Referred To
Appeal
APPEAL from the order of E.M. Morgan J., 2018 ONSC 1880 (S.C.J.) dismissing an action and from the costs order of E.M. Morgan J., 2018 ONSC 3347 (S.C.J.).
Counsel:
- Kevin O'Brien and Karin Sachar, for appellant
- Carlos Martins and Andrew MacDonald, for respondents
Judgment
The judgment of the court was delivered by
DOHERTY J.A.:
I. Overview
[1] The respondents (referred to collectively as the "Globe") published a series of articles between September 2015 and February 2016 about the appellant's ("Bondfield") successful bid on a $300 million contract to build a new critical care facility at St. Michael's Hospital in Toronto ("SMH"). Among other things, the articles addressed the connection between Bondfield and its president John Aquino and Vas Georgiou, a senior executive at SMH who was on the committee that awarded the construction contract to Bondfield. Bondfield sued the Globe for $125 million, asserting that the Globe's articles falsely alleged a corrupt connection between Mr. Aquino and Mr. Georgiou that had played a role in Bondfield obtaining the contract.
[2] The Globe defended on the basis that the articles were not defamatory but rather focused on Mr. Georgiou's checkered past, and the undisclosed conflict of interest in the bidding process flowing from Mr. Georgiou's and Mr. Aquino's common business interests. The Globe also advanced various defences including fair comment and responsible communication.
[3] The Globe brought a motion under s. 137.1 of the Courts of Justice Act, R.S.O. 1990, c. C.43 to dismiss Bondfield's action claiming that the lawsuit was brought to silence the Globe on matters of significant public importance. The motion judge allowed the Globe's motion, dismissed the action and awarded the Globe costs on a substantial indemnity basis fixed at $500,000.
[4] Bondfield appeals. Bondfield's primary argument rests on the submission that the motion judge misinterpreted the provisions in s. 137.1, and in particular, s. 137.1(4)(a)(ii). Bondfield submits that this court, in a series of decisions released after the motion judge released his reasons, has interpreted s. 137.1 in a fundamentally different way than did the motion judge. Bondfield argues that on a correct interpretation of s. 137.1, the Globe's motion to dismiss Bondfield's action should have failed.
[5] The Globe accepts that certain passages in the motion judge's reasons are inconsistent with this court's subsequent interpretation of s. 137.1. The Globe argues, however, that the motion judge's application of s. 137.1 to the facts as he found them is consistent with this court's approach. Alternatively, the Globe urges this court to perform its own s. 137.1 analysis. The Globe submits that applying the section as this court has interpreted it leads to the dismissal of Bondfield's action.
II. The Motion Judge's Analysis
[6] On the s. 137.1 motion, the Globe had to satisfy the motion judge that the articles in issue related to a matter of public interest (s. 137.1(3)). If the Globe met that onus, the onus shifted to Bondfield to establish three things on the balance of probabilities:
- there were grounds to believe that the claim had "substantial merit" (s. 137.1(4)(a)(i));
- there were grounds to believe that the Globe did not have a "valid defence" (s. 137.1(4)(a)(ii));
- the harm suffered or likely to be suffered by Bondfield as a result of the articles was sufficiently serious that the public interest in allowing the lawsuit to continue outweighed the public interest in protecting the Globe's freedom of expression (s. 137.1(4)(b)).
[7] The motion judge described the subject matter of the challenged articles as the operation of the procurement process in respect of the contract to build the critical care facility at SMH. That contract involved the expenditure of a very large amount of public money: paras. 34-35. The motion judge characterized the topic as a matter of public interest. The parties accept that finding. The Globe met its onus under s. 137.1(3).
[8] The motion judge then turned to the merits inquiry required under s. 137.1(4)(a). He first considered whether Bondfield had satisfied him that its claim had substantial merit. The motion judge considered the competing interpretations of the articles that had been advanced by Bondfield and the Globe. He said, at para. 42:
[T]he average Globe reader would almost inevitably conclude that Georgiou was a fraudster who undermined the fairness and integrity of the SMH procurement process. The reader would further conclude that Bondfield had won its bid as a result of its relationship and collusion with Georgiou.
(Emphasis added)
[9] The motion judge had little difficulty based on the meaning he ascribed to the articles in concluding that Bondfield had provided grounds to believe that it could make out the elements of a defamation claim. In other words, there was reason to believe that Bondfield's claim had "substantial merit". Bondfield cleared the hurdle in s. 137.1(4)(a)(i). This aspect of the motion judge's ruling is not challenged on appeal.
[10] The motion judge's analysis of the "no valid defence" requirement in s. 137.1(4)(a)(ii) is in issue on the appeal. The motion judge explained his interpretation of that subsection, at para. 46:
What is clear is that there cannot be an arguable point on the defence side. That is, a defense that could go either way -- i.e. one that could potentially apply but it is not clear at this stage whether or not it will actually succeed -- does not meet the statutory criterion of "no valid defence to the proceeding." In order to meet the [s. 137.1(4)(a)(ii)] criterion, Bondfield must establish that the Globe has no valid defence whatsoever.
(Emphasis added; citation omitted)
[11] The motion judge proceeded to accurately and clearly set out the elements of the fair comment defence. He then said, at para. 56:
It is therefore evident at this stage of the action that the Globe has a potentially valid defence of fair comment. I reiterate that this finding is not that the defence is successful such as might be made at the conclusion of a trial or summary judgment motion. Rather, it is a finding made at an early stage of the action and within the terms of s. 137.1(4)(a)(ii) of the CJA that a valid defence potentially exists. On the state of the record before me, there is no reason to conclude that the defence of fair comment is unavailable to the Globe or that the defence cannot succeed.
[12] If the above passages left any doubt about the motion judge's interpretation of the "no valid defence" provision, the trial judge's comments near the end of his reasons when discussing the effect of his interpretation of s. 137.1 remove that doubt. He said, at para. 89:
In requiring an otherwise serious and meritorious claim to be dismissed because at this stage a potential defence cannot be eliminated, s. 137.1 of the CJA risks tipping the balance further in the publisher's favor than the anti-SLAPP policy requires.
[13] The motion judge recognized that his finding that Bondfield had not cleared the "no valid defence" hurdle in s. 137.1(4)(a)(ii) necessitated the dismissal of Bondfield's claim. He went on, however, to consider s. 137.1(4)(b). He ultimately concluded that the balancing of public interests identified in that clause favoured proceeding with Bondfield's claim.
III. Did the Motion Judge Err in His Interpretation of the "No Valid Defence" Provision?
[14] The motion judge did not have the benefit of this court's reasons in 1704604 Ontario Ltd. v. Pointes Protection Assn., 2018 ONCA 685 and related cases. His interpretation of s. 137.1(4)(a)(ii) has been overtaken by those cases. As explained in Pointes, at para. 84:
The onus rests on the plaintiff to convince the motion judge that, looking at the motion record through the reasonableness lens, a trier could conclude that none of the defences advanced would succeed.
[15] The motion judge [at para. 46] placed the onus on Bondfield to show that "the Globe has no valid defence whatsoever". As explained in Pointes, s. 137.1(4)(a)(ii) imposes a significantly less onerous burden on Bondfield. Bondfield was required to show that a reasonable trier could conclude that the Globe did not have a valid defence. Bondfield would meet that onus if it showed that a reasonable trier could reject all of the various defences put in play by the Globe. A determination that a defence "could go either way" in the sense that a reasonable trier could accept it or reject it is a finding that a reasonable trier could reject the defence. That is as far as Bondfield had to go to meet its onus under s. 137.1(4)(a)(ii). The motion judge erred in law in holding that Bondfield was required to show that the Globe had no valid defence. Bondfield was only required to show that a reasonable trier could reject the defences advanced by the Globe.
[16] On my reading of the motion judge's reasons, had he had the benefit of the analysis in Pointes, he would have found that Bondfield had met its onus to show grounds to believe that the Globe had no valid defence. The motion judge accepted that the Globe had [at para. 56] "a potentially valid defence of fair comment". However, he also accepted [at para. 89] that Bondfield had a "serious and meritorious claim". The motion judge saw this as a case that [at para. 46] "could go either way".
[17] My assessment of the record arrives at the same conclusion. The Globe advanced at least two defences, fair comment and responsible communication, that could reasonably be accepted by a trier. However, the ultimate success of those defences depended on whether the trier would make certain findings. For example, in respect of the fair comment defence, a reasonable trier could view the statements suggesting corruption and collusion in the bidding process as factual assertions or as statements of opinion. If the trier characterized them as the former, the fair comment defence would not succeed. If the trier characterized them as statements of opinion, the defence could well succeed. In short, there was a reasonable prospect that the Globe's fair comment defence could succeed or could fail. That was enough to get Bondfield past s. 137.1(4)(a)(ii).
[18] In respect of the responsible communication defence, the Globe was required to show, first, that the subject matter of the publications was of public interest; and second, that the publication was responsible, in the sense that reasonable steps were taken to ensure the overall fairness of the publication and the accuracy of any factual assertions in the publication: Grant v. Torstar Corp., 2009 SCC 61, at para. 98; Armstrong v. Corus Entertainment Inc., 2018 ONCA 689, at para. 28. On my review of the record, both the overall fairness of the Globe's articles and the reasonableness of the steps taken to validate the accuracy of any factual assertions in the articles are open to legitimate dispute. A trier could reasonably find for or against the Globe on these issues. Bondfield established grounds to believe that the responsible communication defence would fail.
[19] I would hold that Bondfield met its onus under s. 137.1(4)(a)(ii) to show grounds to believe that a reasonable trier could conclude that the Globe did not have a valid defence. Bondfield cleared both merits hurdles in s. 137.1(4)(a).
IV. Should the Claim Have Been Dismissed on the "Public Interest" Balancing in S. 137.1(4)(b)?
[20] As indicated above, the motion judge considered the application of s. 137.1(4)(b) although on his analysis it was unnecessary to do so as he had determined that Bondfield's action must be dismissed pursuant to s. 137.1(4)(a)(ii). The motion judge found that the public interest balancing in s. 137.1(4)(b) favoured permitting Bondfield to proceed with its action. Several of the factors identified by the motion judge were subsequently acknowledged by this court in Pointes and related cases to be relevant to the balancing process in s. 137.1(4)(b): see Pointes, at paras. 85-95; Able Translations Ltd. v. Express International Translations Inc., 2018 ONCA 690, at paras. 37-44.
[21] Normally a deferential standard of review will apply to a motion judge's analysis of the competing public interests in s. 137.1(4)(b): Pointes, at para. 97. However, given that the motion judge did not have the benefit of this court's subsequent decisions, I will engage in a de novo balancing of the competing public interests. I come to the same conclusion as did the motion judge.
[22] In Platnick v. Bent, 2018 ONCA 687, at para. 98, this court suggested that the public interest balancing in s. 137.1(4)(b) could begin with the question "does this claim have the hallmarks of a classic SLAPP?" This litigation has none of those hallmarks.
[23] There is no history of Bondfield using litigation or the threat of litigation to silence critics. There is no financial or other power imbalance that favours Bondfield over the Globe. There is no suggestion of any punitive or retributory purpose motivating Bondfield's lawsuit: Platnick v. Bent, at para. 99.
[24] Nor is this a case in which Bondfield has failed to produce any evidence of loss in the form of monetary damages. To the contrary, Bondfield has produced evidence that it has lost contracts, potential construction partners and potential funding from lenders as a result of the articles written in the Globe. These losses, if connected in whole or in part to any defamatory statements, would result in a significant damage award in favour of Bondfield.
[25] I hasten to add that the Globe has a good argument that any losses suffered by Bondfield are not causally connected to the alleged defamation but are, in fact, the result of Bondfield's failure to abide by the rules pertaining to the bidding process and, in particular, its failure to disclose in the course of that process its business connections with Mr. Georgiou. In my view, however, the s. 137.1 motion was not the place to resolve the causal connection issue as it related to the alleged damages. For the purposes of asserting harm suffered or likely to be suffered, it was enough that Bondfield presented specific and credible evidence of potentially significant pecuniary damages flowing from the defamatory statements: Pointes, at paras. 90-92. Like the motion judge, I think Bondfield made out a formidable case of significant harm suffered or likely to be suffered as a result of the articles should they be found to be defamatory.
[26] There is, however, much to be said for the public interest in protecting the Globe's freedom of expression. The articles dealt in considerable depth with the integrity of the contract bidding process on a project that involved millions of dollars in public funds. The community clearly has a significant interest in that subject. By engaging in a lengthy and no doubt expensive investigation, the Globe was able to shine considerable public light on that process and raise legitimate concerns about the process. There is a very real public benefit to this kind of investigative reporting.
[27] Whatever may ultimately be determined about the quality of the Globe's investigation and the fairness of the reporting, there is nothing in this record that could reasonably suggest that the Globe was motivated by anything other than a desire to inform the public about the facts the Globe's investigation had revealed. Similarly, the Globe's articles are devoid of deliberate falsehoods, hyperbole, gratuitous personal attacks, or other similar characteristics that would diminish the public interest in protecting the expression: Pointes, at para. 94.
[28] There are powerful arguments to be made on both sides of the public interest balancing required in s. 137.1(4)(b). In the end, I view this as a case in which Bondfield has a legitimate argument that it has been defamed and suffered significant damages as a result of the Globe articles. The Globe has legitimate arguments, both that the content is not defamatory and that it has defences to any parts that are defamatory. Unlike SLAPP suits which reek of the plaintiff's improper motives, claims of phantom harm, and bullying tactics, this litigation smells of a genuine controversy. It should be tried on its merits.
V. The Applications for Leave to Appeal Costs
[29] Both sides sought leave to appeal the costs order made by the motion judge. As I would allow the main appeal, the costs order made by the motion judge falls. There is no need to address the applications for leave to appeal costs.
VI. Conclusion
[30] For the reasons set out above, I would allow the appeal, set aside the dismissal of the action and remit the matter to the Superior Court.
[31] The parties may provide submissions of five pages or less in respect of the costs of the motion and the costs of the appeal. They should exchange those submissions and file them with the court by March 21, 2019.
Appeal allowed.
End of Document
