Court of Appeal for Ontario
Date: April 13, 2018 Docket: C63203 Judges: Juriansz, Lauwers & Miller JJ.A.
Between
James Wallbridge, Almeda Wallbridge and Wallbridge, Wallbridge Plaintiffs (Appellants)
and
Fay Brunning and Williams-Litigation Lawyers Defendants (Respondents)
Counsel
Geoffrey D.E. Adair (Q.C), for the appellants
Michael R. Kestenberg, for the respondents
Heard: February 27, 2018
On appeal from the judgment of Justice Annalisa S. Rasaiah of the Superior Court of Justice, dated December 20, 2016 with reasons reported at 2016 ONSC 7964.
Juriansz J.A.:
A. INTRODUCTION
[1] Wallbridge, Wallbridge is a partnership of lawyers with offices in Timmins, Sudbury, North Bay and New Liskeard, Ontario. Williams Litigation Lawyers is a partnership of lawyers located in Ottawa, Ontario. Fay Brunning is a lawyer duly licensed to practice law in the Province of Ontario and she practices "in association" with Williams.
[2] Brunning's practice is separate from that of Williams, but she shares the same office address, telephone number, fax number and front desk receptionist. She pays Williams a monthly rental fee for the space and facilities she uses in Williams' office. Williams authorized Brunning to use its letterhead described below, without supervision.
[3] Williams' letterhead references Brunning as "Practicing in Association, not in Partnership". In particular, Brunning's name is listed with other lawyers' names in the header of the letterhead with an asterisk beside her name. She is the only lawyer listed in the header of the letterhead with an asterisk. The footer of the letterhead lists Brunning's name again and all of her contact information. Similarly, Brunning's email signature indicates that she is "Practicing in Association with Williams". Williams' website includes a photo of Brunning, along with photos of the Williams lawyers under the titles "Our Lawyers" and "Meet Our Team". The other lawyers are identified as Counsel, Partner or Associate. Brunning is identified as "Lawyer, Practicing in Association".
[4] One area of Brunning's practice includes the representation of former Indian Residential School students claiming compensation for historical mistreatment at various residential schools ("IRS Claims" or "IRS Claim").
B. BACKGROUND
[5] On or about May 20, 2016 Wallbridge issued a statement of claim alleging that Brunning made a series of defamatory comments, misrepresentations and allegations about or directed at Wallbridge related to their representation of former Indian Residential School students. Wallbridge named Williams as a defendant claiming that Williams was vicariously liable for the defamatory comments, misrepresentations and allegations of Brunning.
[6] Williams had no knowledge of the allegedly defamatory correspondence written and sent by Brunning in respect of the IRS Claims.
[7] Williams brought a motion for summary judgment seeking dismissal of the action as against it. Its motion record contained its motion, the affidavit of Mr. Kelly Hart, a Partner with Williams, and the statements of claim and defence.
[8] In resisting the motion, Wallbridge filed no affidavits, but did file a letter from Williams' counsel that provided Mr. Hart's answers to written interrogatories made by Wallbridge's counsel as cross-examination on Mr. Hart's affidavit. Brunning did not participate in the motion.
C. MOTION JUDGE'S DECISION
[9] On motion for summary judgment Williams raised two issues. First, Williams argued that Wallbridge had not filed the correspondence alleged to be defamatory, and so had failed to put its best foot forward. The content of the allegedly defamatory correspondence was merely set out in the statement of claim. Second, Williams argued that since the evidence established Brunning was never an employee, agent or partner of Williams and was never held out to be the same, there was no basis upon which it could be found vicariously liable. Therefore, there was no genuine issue for trial.
[10] Wallbridge responded arguing that there was a genuine issue requiring a trial, being whether Brunning should be treated as either a partner or employee of Williams such that Williams was vicariously liable for the actions of Brunning in respect of the defamatory correspondence.
[11] The motion judge granted summary judgment on the second issue, deciding that Williams could not be vicariously liable for Brunning's allegedly defamatory correspondence. She found it unnecessary to deal with the first issue.
[12] The motion judge reasoned that Brunning was not a partner or employee of Williams and was not acting as its agent; that Williams took steps to identify its relationship with Brunning, on its letterhead and in its email template, so as to make the status of their relationship clear to recipients; that Brunning's relationship with Williams was a space and cost-sharing agreement only; that there was no evidence Williams specifically authorized the use of its letterhead and email template to publish defamatory statements; that Williams did not know about the correspondence until after the fact; that functionally, Williams did not control the conduct of Brunning and was not in command of Brunning; that Williams did not practice in the area of IRS Claims, and at no time did Williams participate in or act in respect of Brunning's IRS Claim files.
[13] On these facts, the motion judge found that vicarious liability should not attach to Williams for any defamation by Brunning. Given her decision on the issue of vicarious liability, she did not address the issue of Wallbridge's failure to adduce any evidence of the defamation.
D. ISSUES ON APPEAL
[14] The same two issues are raised on appeal.
[15] Williams submits the appeal should be dismissed at first instance, on the basis that Wallbridge led no evidence establishing defamation on the motion. It further submits the motion judge correctly decided the issue of liability on summary judgment.
[16] Wallbridge submits that the motion judge erred in granting summary judgment. For the reasons that follow, I agree.
E. ANALYSIS
(1) Issue 1: Wallbridge's failure to file evidence of the defamation
[17] While conceding that it brought its summary judgment motion solely on the basis that it could not be found to be vicariously liable for Brunning's allegedly defamatory correspondence, Williams submitted before the motion judge and in this court that Wallbridge had failed to file evidence establishing defamation.
[18] The motion judge noted that there was no denial in Williams' evidence that Brunning sent the correspondence, and also that the court knew from having heard another motion in the proceeding that Brunning claimed defences for having written the correspondence. The motion judge was entitled to take judicial notice of what was in the court file, namely, that Brunning conceded writing the correspondence alleged to be defamatory. She also noted that counsel for Wallbridge offered to file a one-paragraph affidavit attaching the allegedly defamatory correspondence, but did not rule on that offer, saying she did not need to decide "the issue of the filing of further material".
[19] Had the motion judge dealt with this argument, it would have been properly rejected. Williams defended the action as against it on the basis that it was not liable for any of Brunning's acts or omissions. Williams' statement of defence did not deny or otherwise address the paragraphs of the statement of claim that set out Brunning's allegedly defamatory correspondence. Consistent with this, Williams brought its summary judgment motion solely on the basis that it could not be found to be vicariously liable for that correspondence.
[20] Williams' argument that Wallbridge failed to put its best foot forward has no merit. That the correspondence was allegedly defamatory was not a live material issue in the action between Wallbridge and Williams. The only live material issue in the action between them, as defined by the pleadings, was whether Williams could be found liable for that correspondence, and that is the issue to which Wallbridge responded.
[21] While this is sufficient to dispose of this issue, I add that I did not find persuasive Williams' argument that even though its summary judgment motion was brought on the narrow and specific ground of vicarious liability, Wallbridge was required to put its best foot forward and file evidence establishing defamation. This would mean, for example, that if a defendant brings a summary judgment motion on the narrow and specific ground that the plaintiff missed the limitation period, the plaintiff would be required to file evidence proving its entire case on the merits. The proposition, if correct, would cause much inefficiency.
[22] The authorities Williams relied on for this proposition were not helpful. For example, in Mahoney v. Sokoloff, 2015 ONCA 390, the defendants brought a general summary judgment motion that was granted. On appeal, this court, at para. 3, explained "[t]he appellants complain that, in their summary judgment materials, the respondents failed to challenge specifically the appellants' FLA-based claims for damages. In these circumstances, they say, they were not obliged to lead evidence of these damages on the summary judgment motion." This court rejected that argument. Accordingly, the appeal was dismissed. In Mahoney, the appellants argued they did not have to respond to an argument unless it was specifically raised in the summary judgment motion materials. Conversely, in this case, Wallbridge responded to the only argument specifically raised.
[23] The better authority is Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co., 28 O.R. (3d) 423 (Gen. Div.). The summary judgment motion in Transamerica was similar to the one in this case. Canada Life Assurance Co. brought a summary judgment motion on the ground that it could not be found to be liable for the wrongs of Canada Life Mortgage Services Ltd., its wholly owned subsidiary. It was on that issue that Sharpe J. found that Transamerica had failed to put its best foot forward. He said, at para. 24: "[i]n my view, Transamerica has failed to present evidence to indicate that there is a triable issue on this point and Canada Life has met the onus of showing that it should be granted summary judgment on this issue." [Emphasis added.]
[24] Given that Williams' summary judgment motion was brought solely on the ground of vicarious liability, Wallbridge was only obliged to respond to that issue.
(2) Issue 2: Williams' possible liability for Brunning's alleged defamation
[25] I would allow the appeal on this issue. The motion judge recognized that the question whether Williams was liable for Brunning's alleged defamation was without precedent and involved the application of policy rationales. The evidence included several factors that could support a finding that Williams should be found liable for the allegedly defamatory correspondence. The motion judge attached little weight to or disregarded these factors.
[26] The question was a novel one. The implications of lawyers "practicing in association" are potentially far-reaching, certainly much wider than the litigants and dispute in this case. It was not in the interests of justice to decide the question on summary judgment motion given the importance and novelty of the question and the existence of much evidence supporting the appellant's position. The question would be better determined on a full evidentiary record, where the factual and legal issues and the consequences of imposing liability on the respondent can be carefully considered.
[27] The motion judge did not attach weight to the fact that the publication of most of the allegedly defamatory correspondence was on the letterhead of the Williams firm. This could reasonably be seen as Williams placing its reputation behind the alleged defamation.
[28] Brunning's use of Williams' letterhead to send the allegedly defamatory correspondence was fully authorized. Williams granted to Brunning a complete and uncontrolled licence to communicate using its letterhead. In doing so, Williams created the opportunity, and took the risk, Brunning could use its letterhead to publish defamatory material, as it is alleged she did in this case.
[29] The motion judge regarded Brunning as independent from Williams such that Williams could not control her conduct except by reviewing all her correspondence before it was sent. That may be so, but Williams could have avoided being implicated in Brunning's conduct by refusing to allow Brunning to use its letterhead, leaving Brunning to use an individual letterhead showing her as a sole practitioner at the same address. Williams allowed its name and reputation to be used in conveying the alleged defamation.
[30] While the motion judge found Williams never held Brunning out as a "Partner" or "Associate" of the firm, she never considered the import of the fact Williams held Brunning out as "associated" with it. Williams holding Brunning out as "associated" with it was methodical and purposeful. Mr. Hart states in para. 3 of his affidavit "Brunning began practicing in association with Williams on or about January 2, 2016". In para. 4, Mr. Hart states "Brunning had an existing law practice and had no employment relationship with Williams before she began practicing in association with Williams". In para. 7, he states that "Williams began using the [Williams] letterhead shortly after Brunning began practicing in association with Williams …". In para. 9, he confirms that Williams' website "at all material times, indicated that Brunning practices in association with the firm." [Emphasis added.]
[31] Williams' pleading is to the same effect. Para. 5 of Williams' statement of defence pleads that "Brunning had an existing law practice when she began practicing in association with Williams". Similarly, para. 8 pleads that "[a]t all material times, Williams' letterhead clearly indicated that Brunning was practicing in association with Williams." Para. 10 denies any vicarious liability but affirms that Brunning "at all material times was practicing in association with Williams." [Emphasis added.]
[32] The header of the sample letter written on Williams' letterhead and attached to Mr. Hart's affidavit lists Brunning, with an asterisk, together with the other Williams lawyers. The footer of the Williams' letterhead has, from left to right, the address and website of the Williams' firm, Brunning's name with the identification "Lawyer" and her email address at the domain "@williamslitigation.ca" and finally an asterisk that states "Practicing in Association, not in Partnership". Each of the following seven pages of the sample letter has the header "WILLIAMS Litigation Lawyers". There is no asterisk on the headers of the following pages.
[33] Exhibit C to Mr. Hart's affidavit is a printout from Williams' website. It includes Brunning's photo along with photos of the Williams lawyers under the titles "Our Lawyers" and "Meet Our Team". The other lawyers are identified as Counsel, Partner or Associate. Brunning is identified as "Lawyer, Practicing in Association".
[34] Exhibit B to Mr. Hart's affidavit is a sample email sent by Brunning. Below her name is the identification "Barrister and Solicitor" and the note "Practicing in Association with Williams Litigation Lawyers." Williams' logo is displayed prominently below.
[35] No evidence from recipients of the allegedly defamatory correspondence is necessary to establish that they understood Brunning is associated with Williams. The evidence clearly establishes that fact, and Williams claims that is the case. The letterhead and website state that Brunning is not a "Partner", and they distinguish her from the status of "Associate". However, the evidence could support a finding that Williams holds Brunning out as a lawyer who is one of "Our Lawyers" and a member of "Our Team", albeit one who practices in "association" with it.
[36] Given the strength of the evidence that could support a finding that Williams should be found liable for Brunning's allegedly defamatory correspondence, and given the novelty and importance of the question, the motion judge should have refused to grant summary judgment and allowed the matter to proceed to trial.
F. DISPOSITION
[37] Accordingly, for the reasons given, I would allow the appeal. I would set aside the order of the motion judge, dated September 23, 2016, granting summary judgment in favour of Williams and dismissing Wallbridge's action as against it. The appellant is entitled to the costs of the appeal in the agreed upon all-inclusive sum of $12,500 and to the costs of the motion in the amount that the trial judge fixed in favour of Williams.
Released: April 13, 2018
"R.G. Juriansz J.A."
"I agree. P. Lauwers J.A."
"I agree. B.W. Miller J.A."
