Court File and Parties

Court of Appeal for Ontario Date: 2023-02-10 Docket: C70018, C70059 & C70120

Before: Feldman, Lauwers and Roberts JJ.A.

Docket: C70018 Between: Nathalie Xian Yi Yan, Plaintiff (Appellant) And: Greg Hutchinson and Shanna Christine Yee, Defendants (Respondents)

Docket: C70059 And Between: Nathalie Xian Yi Yan, Plaintiff (Appellant) And: Rebecca Catherine Durcan, Erica Richler, Maya Pearlston and Robin Kenneth McKechney, Defendants (Respondents)

Docket: C70120 And Between: Nathalie Xian Yi Yan, Plaintiff (Appellant) And: Edward Lawrence Marrocco, Defendant (Respondent)

Counsel: Nathalie Xian Yi Yan, acting in person Andrea LeDrew and Christian Breukelman, for the respondents, Greg Hutchinson and Shanna Christine Yee Gillian Hnatiw and Laura Snowdon, for the respondents, Rebecca Catherine Durcan, Maya Pearlston, Erica Richler and Robin Kenneth McKechney Ian Sinke, for the respondent, Edward Lawrence Marrocco

Heard: January 19, 2023

On appeal from the order and costs award of Justice Paul R. Sweeny of the Superior Court of Justice dated October 19, 2021, with reasons reported at 2021 ONSC 6957. On appeal from the order and costs award of Justice Paul R. Sweeny of the Superior Court of Justice dated October 19, 2021, with reasons reported at 2021 ONSC 6953. On appeal from the order and costs award of Justice Paul R. Sweeny of the Superior Court of Justice dated October 12, 2021, with reasons reported at 2021 ONSC 6791.

Reasons for Decision

Overview

[1] The appellant, Nathalie Xian Yi Yan, is a practitioner of traditional Chinese medicine in Hamilton. She has been licensed by the College of Traditional Chinese Medicine Practitioners and Acupuncturists of Ontario since 2013. The College brought disciplinary proceedings against her. The College’s Discipline Committee found the appellant guilty of professional misconduct.

[2] After Ms. Yan became aware that the Committee’s reasons for the decision had been posted and were publicly accessible on, she started 19 separate claims against multiple defendants who were involved in the College’s investigation and in the disciplinary proceedings. She believes that the investigators, lawyers and independent counsel in the disciplinary proceedings all owed her certain duties. She feels much aggrieved by the Discipline Committee’s decision, which she sees as unjust, defamatory, and harmful to her public reputation.

[3] The defendants brought successful motions under r. 21.01(1)(b) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Rules”), to strike Ms. Yan’s statements of claim on the basis that they disclosed no cause of action. This is a grouped appeal by Ms. Yan from the orders striking her claims. For the reasons set out below, we dismiss Ms. Yan’s appeals.

The Legal Context

[4] The overall legal context frames this appeal. In August 2016, the College opened an investigation into Ms. Yan’s practice. In July 2017, the College served a formal Notice of Hearing setting out several serious allegations against her.

[5] As noted, the College’s Discipline Committee found the appellant guilty of professional misconduct. She was suspended for 12 months and ordered to pay a $300 fine, to re-educate and re-license after the 12-month suspension, and to pay the College’s costs of the investigation: see Ontario (College of Traditional Chinese Medicine Practitioners & Acupuncturists of Ontario) v. Yan, 2018 ONCTCMPAO 28. Ms. Yan’s appeal was dismissed by the Divisional Court on October 5, 2022: Yan v. College of Traditional Chinese Medicine Practitioners and Acupuncturists of Ontario, 2022 ONSC 5464.

[6] Ms. Yan advises that she has sought leave to appeal the Divisional Court’s decision. This decision on Ms. Yan’s civil actions is separate from and has no effect on whether another panel of this court will or will not grant her leave to appeal the Divisional Court’s decision.

Issues on Appeal

[7] The appellant raises the same four issues in all three appeals.

(1) Did the motion judge err in law on motions to strike? (2) Do the allegations disclose a reasonable cause of action for defamation, professional negligence, misrepresentation and breach of due process? (3) Should the appellant be granted leave to amend the claim? (4) Are the costs awards unreasonable?

The Decisions under Appeal

[8] The three orders arise from the following claims in which the appellant sued multiple defendants who were involved in the College’s investigation and disciplinary proceeding:

I. In C70018, the appellant brought two separate actions against the investigators, Shanna Christine Yee and Greg Hutchinson, for “defamation, professional negligence, [tampering with] evidence, and breach of due process”. II. In C70059, the appellant brought four separate actions against lawyers who acted for the College in the disciplinary proceeding for wrongful conduct including “defamation, the transgressions of misrepresenting authority and professional negligence”. These were Rebecca Durcan, Erica Richler, Maya Pearlston, and Robin McKechney, lawyers at the law firm of Steinecke Maciura LeBlanc. The firm is counsel to the College and its lawyers acted as prosecutors in the disciplinary process. III. In C70120, the appellant sued Edward Marrocco, who was independent legal counsel to the Discipline Committee of the College at the appellant’s disciplinary hearing, for “defamation, negligence, dereliction of duty, obstructing justice and breach of due process”.

[9] The motion judge declined to dismiss the actions under r. 2.1.01 as frivolous and vexatious. Instead, the motion judge scheduled and heard motions by the defendants under r. 21 to strike the pleadings in these actions, on the basis that they did not disclose a reasonable cause of action, and because they were a collateral attack on the panel’s decision and were an abuse of the process of the court.

[10] The appellant’s statements of claim against the respondents in these appeals are substantively similar with some variations in the causes of action and factual background. However, the statements of claim also focus on the content of the Discipline Committee’s decision, which the appellant claims is defamatory.

[11] The motion judge struck the appellant’s claims in their entirety without leave to amend.

The Motion Judge Correctly Granted the Motions to Strike

[12] We begin with a review of some of the governing principles. First, the motion judge applied the correct legal test on a r. 21.01(1)(b) motion to strike citing the following well-established principles from Cottage Advisors of Canada v. Prince Edward Vacant Land, 2020 ONSC 6445, at para. 16. A claim will be found legally insufficient if its allegations “do not give rise to a recognized cause of action or it fails to plead the necessary elements of an otherwise recognized cause of action … [A] plaintiff must, at minimum, plead the basic elements of a recognized cause of action pursuant to which an entitlement to damages is claimed. Vague allegations that make it impossible for [the defendant] to reply should be struck”: Aristocrat Restaurants Ltd. v. Ontario, 2003 CarswellOnt 5574, at paras. 18-19.

[13] Second, s. 38 of the Regulated Health Professions Act, 1991, S.O. 1991, c. 18 (“RHPA”) provides general immunity to the College and all participants in disciplinary proceedings. Under the heading “Immunity”, s. 38 provides:

38 No action or other proceeding for damages shall be instituted against the Crown, the Minister, a College supervisor appointed under section 5.0.1 or his or her staff, an employee of the Crown, a College, a Council, or a member, officer, employee, agent or appointee of a College, a Council, a committee of a Council or a panel of a committee of a Council for an act done in good faith in the performance or intended performance of a duty or in the exercise or the intended exercise of a power under this Act, a health profession Act, the Drug and Pharmacies Regulation Act or a regulation or a by-law under those Acts or for any neglect or default in the performance or exercise in good faith of the duty or power.

[14] The appellant’s claims are barred by s. 38 of the RHPA. The motion judge correctly found that no allegations of bad faith were particularized in the statements of claim that could defeat this immunity, relying on Conroy v. College of Physicians & Surgeons (Ontario), 2011 ONSC 324, 329 D.L.R. (4th) 689, at para. 68, aff’d 2011 ONCA 517, leave to appeal refused, [2011] S.C.C.A. No. 403. Ms. Yan’s statements of claim against the individual investigators make no allegations of bad faith. Two of the five of the statements of claim, those against counsel for the College in the disciplinary proceeding, Mr. McKechney, and independent legal counsel to the Discipline Committee, Mr. Marrocco, make only bald allegations of bad faith. The claims do not otherwise contain any particulars to support the allegation that counsel for the College acted improperly or in bad faith, nor could the pleaded factual circumstances of this case support a claim for bad faith.

[15] Third, s. 36(3) of the RHPA provides that any record of a proceeding under the Act, including reports, documents or things prepared for, or a statement given at such a proceeding, along with orders or decisions made in such a proceeding are inadmissible in a civil proceeding. This court confirmed that “[t]he purpose of s. 36(3) is to encourage the reporting of complaints of professional misconduct against members of a health profession, and to ensure that those complaints are fully investigated and fairly decided without any participant in the proceedings … fearing that a document prepared for the College proceedings can be used in a civil action”: F. (M.) v. S. (N.) (2000), 188 D.L.R. (4th) 296 (Ont. C.A.), at para. 29, leave to appeal refused, [2000] S.C.C.A. No. 531; Task Specific Rehabilitation Inc. v. Steinecke (2004), 244 D.L.R. (4th) 414 (Ont. C.A.), at para. 22. See also Deep v. College of Physicians and Surgeons, 2010 ONSC 5248, at para. 50, aff’d 2011 ONCA 196, at para. 3, leave to appeal refused, [2011] S.C.C.A. No. 152.

[16] Fourth, a party who objects to a tribunal’s decision can challenge that decision by appeal, if the legislation permits an appeal, or by judicial review. Ms. Yan appealed the panel’s decision to the Divisional Court, as noted. But an aggrieved person is not permitted to attack a tribunal’s decision in another proceeding as Ms. Yan has done in these actions. This is known as a collateral attack and is not permitted, as the motion judge noted. The rule against collateral attacks “protects the integrity of the justice system by prohibiting a party from avoiding the consequences of an order issued against it by proceeding in another forum”: R. v. Irwin, 2020 ONCA 776, at para. 24, citing Garland v. Consumers’ Gas Co., 2004 SCC 25, [2004] 1 S.C.R. 629, at para. 72.

[17] Fifth, a number of the defendants are lawyers whom Ms. Yan sued for their conduct in their roles as lawyers. The motion judge correctly noted: “In general, a lawyer owes a duty to his or her client and does not owe a duty to non-clients.” He cited Geo. Cluthe Manufacturing Co. v. ZTW Properties Inc., [1995] O.J. No. 4897 (Div. Ct.), leave to appeal refused, 1995 CarswellOnt 4624 (C.A.). In that case, at para. 28, the court cited Lord Donaldson of Lymington M.R. in Al-Kandari v. J.R. Brown & Co., [1988] 1 All E.R. 833, at p. 835 (C.A.): “I would go rather further and say that, in the context of ‘hostile’ litigation, public policies were usually required that a solicitor be protected from a claim in negligence by his client’s opponent, since such claims could be used as a basis for endless re-litigation of disputes”. This legal principle remains current: Ntakos Estate v. Ntakos, 2021 ONSC 2492, at para. 106.

[18] Sixth, Ms. Yan sued several parties for defamation. However, the law of defamation bars a lawsuit against someone who is protected by “absolute privilege” for utterances in court or tribunal proceedings. The motion judge correctly instructed himself on the law, citing this court’s decision in Salasel v. Cuthbertson, 2015 ONCA 115, 124 O.R. (3d) 401, at para. 35:

The doctrine of absolute privilege contains several basic elements: no action lies, whether against judges, counsel, jury, witnesses or parties, for words spoken in the ordinary course of any proceedings before any court or judicial tribunal recognized by law; the privilege extends to documents properly used and regularly prepared for use in the proceedings; and a statement will not be protected if it is not uttered for the purposes of judicial proceedings by someone who has a duty to make statements in the course of the proceedings: Amato v. Welsh, 2013 ONCA 258, at para. 34.

[19] Seventh, the appellant proposes several new causes of action on appeal, namely violations under ss. 7, 12, and 15 of the Charter, the tort of internet harassment, and the tort of intentional infliction of mental suffering. The appellant’s statements of claim do not plead these causes of actions, their material elements, or any material facts. Parties cannot bring forward new issues on appeal: Whitby (Town) v. G & G 878996 LM Ltd., 2020 ONCA 654, 5 M.P.L.R. (6th) 174, at para. 9, citing Kaiman v. Graham, 2009 ONCA 77, at para. 18.

[20] Even if the appellant were permitted to raise these new causes of action on appeal, it is plain and obvious that they cannot succeed. All of the alleged causes of action are barred by s. 38 of the RHPA. The appellant does not allege or particularize allegations of bad faith. We agree with the respondents Ms. Yee and Mr. Hutchinson that any suggestion that the appellant’s Charter rights are violated by the immunity created by s. 38 of the RHPA or the College disciplinary process is more properly a challenge to the statutory scheme, not the respondents in these appeals. The causes of action relating to the tort of internet harassment and the tort of intentional infliction of mental suffering are also derivative of the defamation claims, because they appear to attack the publication of the disciplinary decision. These claims are also covered by absolute privilege.

[21] These governing principles guided the motion judge and also guide this court in these appeals. We now turn to a more detailed review of the decisions under appeal. Because of the repetitive nature of Ms. Yan’s claims, this review will also be somewhat repetitive.

I. C70018: Yan v. Yee, 2021 ONSC 6957

[22] Ms. Yan’s statements of claim in the actions against the investigators, Ms. Yee and Mr. Hutchinson, contained allegations of “defamation, professional negligence, [tampering with] evidence and breach of due process”. Of course, Ms. Yan was fully able to address these complaints in the College hearing.

[23] The motion judge found that the appellant’s claims against the investigators are barred by s. 38 of the RHPA. The defendants, as investigators, are agents or appointees of the College and thus have immunity for the good faith exercise of their duties. The motion judge noted that there were no allegations of bad faith particularized in the statement of claim.

[24] Apart from the effect of the statutory bar, the motion judge also found that the claim against the defendants in defamation cannot succeed based on the doctrine of absolute privilege. He found that the other causes of action, evidence tampering and breach of due process, are derivative of the defamation claim and are also covered by the doctrine of absolute privilege. He added that the claim is an abuse of process as a collateral attack on the tribunal’s decision. (The appellant sought appeal of the College’s Discipline Committee decision in the Divisional Court but she made a collateral attack on the decision in this proceeding.)

[25] The motion judge found that the claims contain radical defects incapable of being cured by amendment. As the motion judge found, and for the reasons already noted and revisited below, we agree with him that the statements of claim contain radical defects incapable of being cured by amendment.

[26] As noted above, the motion judge’s recitation of the applicable law was correct. Ms. Yan has identified no error in the motion judge’s application of the law and has identified no palpable and overriding error of fact. The appeal of this order is dismissed.

II. C70059: Yan v. Durcan et al, 2021 ONSC 6953

[27] Ms. Yan sued four lawyers at the law firm of Steinecke Maciura LeBlanc, which acts as counsel to the College in separate actions. Mr. McKechney acted for the College in the appellant’s hearing before the Discipline Committee. Ms. Richler acted for the College in Ms. Yan’s appeal of the Committee’s findings before the Divisional Court. Ms. Yan sued Ms. McKechney and Ms. Durcan for “defamation, professional negligence, [tampering with] evidence and breach of due process”. She sued Ms. Richler and Ms. Pearlston for “transgressions of misrepresenting authority, illegal actions, and professional negligence”.

[28] In these statements of claims, Ms. Yan alleges that these four lawyers acted improperly throughout the disciplinary proceedings and related hearings, and as a result, caused the appellant to suffer damages. With respect to Mr. McKechney, the appellant’s statement of claim is essentially identical to those filed against Ms. Yee and Mr. Hutchinson, alleging that the respondent’s conduct throughout the disciplinary proceeding amounted to professional negligence and that the content of the College’s decision was defamatory. In her statements of claim against Ms. Richler and Ms. Pearlston, the appellant alleges that there is a conflict of interest because they acted on behalf of the College in the appeal of the disciplinary proceeding to the Divisional Court and before the Ontario Human Rights Commission. The appellant’s statement of claim against Ms. Durcan highlights her frustrations with the communications she received from the College throughout the disciplinary process.

[29] The motion judge found that the claims against Ms. Durcan and Mr. McKechney in defamation cannot succeed based on the doctrine of absolute privilege for utterances in court or tribunal proceedings for the reasons set out above. As noted, statutory immunity is a complete bar. The motion judge found that there is no reasonable cause of action in professional negligence because, as already noted, in general, a lawyer owes a duty to his or her client and does not owe a duty to non-clients. The defendants were independent counsel retained by the College.

[30] The motion judge found that the claims against Mr. McKechney and Ms. Pearlston were also barred by the immunity provisions in s. 38 of the RHPA and are an abuse of process for the same reasons given in the Yee and Hutchinson decision.

[31] Ms. Yan argues that a conflict of interest arises when lawyers act both as counsel to the College and as prosecutors in the disciplinary proceedings, as the lawyers of Steinecke Maciura LeBlanc did in this case. However, it is not unusual or improper for counsel to act both for a regulator and as prosecutors in that regulator’s disciplinary proceedings: Lysons v. Alberta Land Surveyors’ Association, 2017 ABCA 7, at paras. 8-9, leave to appeal refused, 2017 CarswellAlta 1296 (S.C.C.); DeMaria v. Law Society of Saskatchewan, 2015 SKCA 106, at para. 31, leave to appeal refused, [2015] S.C.C.A. No. 493. Similarly, it was not improper for the College’s counsel to act for the College before the Discipline Committee and in other hearings, such as before the Ontario Human Rights Commission or the Divisional Court appeal. Their appearance in the disciplinary proceeding, its appeal, and related litigation, is a normal part of their role as counsel for the College.

[32] As noted above, the motion judge’s recitation of the applicable law was correct. Ms. Yan has identified no error in the motion judge’s application of the law and has identified no palpable and overriding error of fact.

[33] The appeal of this order is dismissed.

III. C70120: Yan v. Marrocco, 2021 ONSC 6791

[34] Ms. Yan sued Mr. Marrocco, the Discipline Committee’s independent legal counsel, for “defamation, professional negligence, public malfeasance and breach of due process”. Her claim against Mr. Marrocco is essentially the same as the claims she made against Ms. Yee, Mr. Hutchison and Mr. McKechney.

[35] In oral argument Ms. Yan submitted that Mr. Marrocco should not have made any interjections during the discipline hearing. There is no evidence before this court that any of his interjections were inappropriate or outside the usual scope of independent counsel for the Discipline Committee.

[36] With respect to the claims against Mr. Marrocco, the independent legal counsel for the panel, the motion judge once again found that the claim is barred by s. 38 of the RHPA. There is also no claim in defamation due to the doctrine of absolute privilege. The motion judge also found the claim to be a collateral attack and an abuse of process, which, as noted above, is not permitted.

[37] The motion judge’s recitation of the applicable law was correct. Ms. Yan has identified no error in the motion judge’s application of the law and has identified no palpable and overriding error of fact.

[38] The appeal of this order is dismissed.

IV. The Motion Judge Did Not Err in Denying Leave to Amend the Claims

[39] Ms. Yan argues that the motion judge erred in denying leave to amend the claims. The law is that a plaintiff should be afforded the opportunity to amend their pleadings “unless the statement of claim contains a ‘radical defect’ incapable of being cured by an amendment”: Indal Metals v. Jordan Construction Management Inc., [1994] O.J. No. 1616 (Gen. Div.), at para. 13, adopted by this court in Taylor v. Tamboril Cigar Co., 2005 CarswellOnt 4775. The motion judge found that the appellant’s claims contain flaws that cannot be cured by amendment, citing Roche v. MacLeod Law Firm, 2018 ONSC 2760, at para. 28.

[40] The motion judge also found that the claims constitute a collateral attack on the College’s disciplinary proceedings. There is no doubt that the appellant’s claims in this case are an attempt to indirectly attack the disciplinary and related proceedings, and in this way, they are an abuse of process as he found. No cure of the pleadings is possible.

[41] Ms. Yan’s oral submissions before this court attacked the Discipline Committee’s decision, further supporting the motion judge’s finding that these actions are an abuse of the process of the court. Ms. Yan can seek appellate review of the Committee’s decision, as she has done in her appeal to the Divisional Court. However, her claims against the respondents in these appeals are improper collateral attacks on the Committee’s decision.

V. Leave to Appeal the Costs Award Is Not Granted

[42] The motion judge awarded $3,500 each to the two respondents in Nathalie Xian Yi Yan v. Yee, 2021 ONSC 6957; $4,000 each to the four respondents in Nathalie Xian Yi Yan v. Durcan, 2021 ONSC 6953; and, $5,000 in Nathalie Xian Yi Yan v. Marrocco, 2021 ONSC 6791. The motion judge awarded reduced partial indemnity costs even though the respondents sought substantial indemnity costs.

[43] Strong grounds are required for this court to grant an application for leave to appeal a costs award. A court should only set aside a costs award on appeal where there has been an error in principle or if the costs award is plainly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2004] 1 S.C.R. 303, at para. 27. Ms. Yan does not point to any such error in principle, and we discern none, nor is the costs award plainly wrong. The motion for leave to appeal costs is denied.

Disposition

[44] For these reasons, the appeal is dismissed with costs to the respondents if demanded. The respondent may make costs submissions on the costs of this appeal in writing no more than three pages in length within seven days, and the appellant may make responding costs submissions on the costs of this appeal in writing no more than three pages in length within an additional seven days.

“K. Feldman J.A.” “P. Lauwers J.A.” “L.B. Roberts J.A.”