CITATION: NAN Corporate Services v. Kocsis, 2015 ONSC 6651
COURT FILE NO.: CV-15-0213
DATE: 2015-10-28
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
NAN Corporate Services c.o.b. as Nishnawbe Aski Nation,
Peter T. Hollinger, for the Plaintiff
Plaintiff
- and -
Ron Kocsis, Isobel Clathworthy, Judy Mayhew, Margie Goulet, Rheal Twance, Robert Taylor, Beatrice Summer, Chelsy McGowan, Eva Wesley and Sarah Beckman,
Ron Kocsis, personally, and on behalf of the Defendants: Ms. Clathworthy (Peever), Ms. Mayhew, Ms. Goulet, and Mr. Taylor,
Defendants
HEARD: October 1, 2015,
at Thunder Bay, Ontario
Madam Justice H.M. Pierce
Reasons on Motion to Strike Statement of Defence and Counterclaim
Introduction
[1] Nishnawbe Aski Nation, known as “NAN,” is a not-for-profit corporation whose membership is comprised of 49 aboriginal communities. NAN carries out its business through a federal corporation, NAN Corporate Services, which is the plaintiff in this proceeding.
[2] Hornepayne First Nation is a First Nation in northern Ontario that does not have a land base or reserve assigned to it. Hornepayne is a member of NAN. The defendant, Mr. Kocsis, states that he is the duly elected Chief of Hornepayne First Nation. The plaintiff alleges that the result of the election on July 10, 2014 is in controversy and has yet to be resolved. Mr. Kocsis adamantly disputes there can be any doubt about his authority as the elected chief.
[3] The remaining defendants state that they are elected members of the band council of Hornepayne First Nation or members and/or Elders of the band.
[4] Interestingly, in December 2014, Mr. Kocsis applied to the Federal Court for an interlocutory injunction by means of a writ of quo warranto to prevent Laura Medeiros and others from holding office as Chief and Council of Hornepayne First Nation following the election of July 2014, until the leadership crisis could be resolved by court order.
[5] On January 26, 2015, the Federal Court dismissed the application. The court held that because Hornepayne First Nation was incorporated under the Ontario Corporations Act, R.S.O. 1990, c. C-38, and not under the Indian Act, R.S.C. 1985, c. I-5, the Federal Court had no jurisdiction to deal with the dispute. See: Hornepayne First Nation v. Medeiros et al., 2015 FC 103.
[6] The defendant, Mr. Kocsis, is not a lawyer. At this motion, he represented himself and, with the consent of Ms. Clathworthy (Peever), Ms. Mayhew, Ms. Goulet, and Mr. Taylor, who were present, he spoke for them. The remaining defendants in this action have not yet been served even though Mr. Kocsis has filed a statement of defence and counterclaim on their behalf. Accordingly, these reasons apply as against the above-named defendants without prejudice to the remaining defendants, should they defend the action once served.
[7] In this proceeding, the plaintiff claims a permanent injunction and damages in trespass against the defendants as a result of what it says was a 51-day occupation of its business premises, which is a trailer located on space rented from the Fort William First Nation. An interim ex parte injunction prohibiting trespass was granted on May 29, 2015, and continues by order of the court.
[8] In addition, the plaintiff claims damages for the cost for security services NAN contracted during the alleged occupation.
[9] The named defendants allege that representatives of Hornepayne First Nation were entitled to be on the NAN business premises because Hornepayne is a NAN member. They argue that they were entitled to be there and therefore were not trespassers. They also assert that they were on the premises with permission. Alternatively, they assert that they did not cause the damages alleged or that the damages claimed are excessive.
[10] Finally, the defendants submit that the Trespass to Property Act, R.S.O. 1990, c. T.21, is a provincial statute that has no application to reserve lands, specifically to Fort William First Nation.
[11] The plaintiff seeks several orders, including an order for summary judgment. As the named defendants wish to cross-examine on the affidavits filed before the summary judgment motion is heard, certain scheduling orders have been made to accommodate cross-examination and the argument of the summary judgment motion.
[12] There remain two pleadings motions brought by the plaintiff to which these reasons apply:
(1) a motion for an order striking out paragraphs 7, 8, 9, 11, 12, 14, 15 and 16 of the statement of defence; and
(2) a motion to strike the counterclaim on the basis that it discloses no reasonable cause of action.
A copy of the statement of defence and counterclaim is attached to these reasons as Schedule “A.”
Principles of Law
[13] Rule 21.01(1)(b) of the Rules of Civil Procedure gives the court jurisdiction to strike out a pleading if it discloses no reasonable cause of action or defence. The rule provides that no evidence is admissible on the motion; the pleading must stand or fall on its own. Therefore, the contents of the voluminous affidavits filed cannot be considered on a motion to strike the pleading. If portions of a pleading are struck, the court has discretion to grant leave to amend.
[14] Rule 25.06(1) of the Rules requires that:
Every pleading shall contain a concise statement of the material facts on which the party relies for the claim or defence, but not the evidence by which those facts are to be proved.
Consequently the allegations pleaded must be relevant to the case.
[15] A counterclaim is a claim in its own right. The test for striking a claim is that it must be plain and obvious that it discloses no cause of action. See: Hunt v. Carey Canada Inc., 1990 CanLII 90 (SCC), [1990] 2 S.C.R. 959 (S.C.C.). In considering whether a pleading should be struck, the court must accept that the facts as alleged in the claim are proven unless they are patently ridiculous or incapable of proof: Nash v. Ontario (1995), 1995 CanLII 2934 (ON CA), 27 O.R. (3d) 1 (C.A.).
[16] On a motion to dismiss a claim for failure to disclose a cause of action, the statement of claim must be read generously to accommodate drafting deficiencies. If the claim has some chance of succeeding, it must be allowed to proceed: Doe v. Metropolitan Toronto (Municipality) (Commissioners of Police) (1990), 74 O.R. (3d) 778 (Div. Ct.).
Motion to Strike Portions of the Statement of Defence
[17] Although the plaintiff submitted in oral argument that virtually all of the statement of defence should be struck on the grounds of irrelevancy or failure to plead material facts, the notice of motion cited only the following paragraphs as being objectionable: paragraphs 7, 8, 9, 11, 12, 13, 14, and 16. Accordingly, I will consider only the paragraphs cited as objectionable in the notice of motion.
[18] The defendants seek leave to amend if portions of the statement of defence are struck.
[19] In determining whether to strike portions of a statement of defence, it is necessary to consider it as a response to the statement of claim, which provides the context for the litigation. In other words, the statement of claim frames the action. If the statement of claim (which is not being challenged in this motion) pleads irrelevancies, it should not be surprising that the defendants plead irrelevancies in response.
[20] In my view, unless irrelevant portions of both the statement of claim and the statement of defence are struck, the statement of defence will be unresponsive to the case raised in the statement of claim. As my reasons below indicate, there are portions of the statement of claim that are also objectionable, even though they have not been challenged.
[21] The substance of the plaintiff’s claim is that the defendants trespassed on the plaintiff’s premises and caused damages. These damages include costs incurred to hire security guards and provide counselling to staff. As I have indicated, the essence of the defence is:
that because their band was a member of NAN, its members were entitled to be on the plaintiff’s premises;
that they were given specific permission to be on the premises;
that the Trespass to Property Act has no application to First Nations lands, upon which the premises were situate;
that their conduct did not give rise to damages; or alternatively,
if their conduct caused damages, the damages claimed are excessive.
[22] Dealing with paragraph 7, the plaintiff suggests that the result of the election in July 2014 is in controversy, as set out in paragraphs 4, 5, and 6 of the statement of claim. The plaintiffs question the legitimacy of the defendants’ status as chief and council of Hornepayne First Nation, but also claim that it is not NAN’s policy to become involved in the internal affairs of its member bands. Accordingly, it is reasonable for the defendants to respond in paragraphs 7, 8, and 9 of the statement of defence to the issue of their identity and status which is the basis of their “colour of right” defence.
[23] In my view, it is the defendants’ belief that they had a colour of right to be on the NAN premises that is relevant, not the actual resolution of the 2014 election. Accordingly, paragraph 11 dealing with the resolution of the election is irrelevant and will be struck, with leave to amend to plead the defendants’ belief in their status as duly elected representatives of Hornepayne First Nation as a result of the election.
[24] The plaintiff pleads in paragraph 7 of the statement of claim that the defendants did not have permission to occupy the premises and gave the plaintiff no advance knowledge of their intention to do so. While permission is a defence to trespass, advance knowledge is not. Nevertheless, the plaintiff raised the issue of advance knowledge in its pleading, forcing the defendants to respond with an irrelevancy. So long as the irrelevant issue of advance notice remains in the statement of claim, the defendants are entitled to answer as they do in paragraph 12 with an irrelevancy which would otherwise have been struck.
[25] At paragraph 8 of the statement of claim, the plaintiff alleges that the defendants occupied its premises without permission on a continuing basis, despite requests that they leave. In paragraph 13 of the statement of defence, the defendants’ respond that Deputy Chief Louttit either gave permission or alternatively, implied that the defendants had permission to be on the premises, giving rise to the defence of colour of right. Paragraph 13 is therefore relevant and material to the claim.
[26] Paragraph 9 of the statement of claim pleads that the defendants refused to vacate the premises despite repeated requests. Paragraph 14 of the statement of defence purports to deal with the second sentence of the plaintiff’s paragraph 9. In fact, paragraph 9 is comprised of only one sentence. Paragraph 14 of the statement of defence refers to a resolution between the parties that the plaintiff later rescinded. Although this pleading is somewhat ambiguous, settlement discussions, with some exceptions, should generally not be pleaded. The breakdown of negotiations, if indeed that is what occurred, is not a defence to trespass. Paragraph 14 shall be struck.
[27] At paragraph 14 of the statement of claim, the plaintiff pleads that it incurred costs to provide counselling to its employees as a result of stress caused by the defendants’ conduct during the occupation. Paragraph 16 of the statement of defence denies the claim, stating that the defendants behaved in a respectful and friendly manner. The defendants challenge the damages which are claimed on the basis of causation and excessiveness. This is appropriate within the law of pleading.
[28] In summary, for the reasons set out above, paragraph 11 of the statement of defence will be struck with leave to amend. Paragraph 14 shall be struck without leave to amend. The amended statement of defence shall be served within 20 days from the release of these reasons. The balance of the plaintiff’s motion to strike certain paragraphs of the statement of defence is dismissed.
Motion to Strike Portions of the Counterclaim
[29] The plaintiff also moves to strike out the counterclaim in its entirety, based on its objections to the following paragraphs:
- paragraph 32 on the grounds that there is no indication how the damages claimed were calculated;
- paragraphs 34 - 38 and 42 on the grounds that they claim damages for interfering in an election, which is not a cause of action known to law or alternatively, that insufficient particulars are pleaded;
- paragraphs 39 - 40 and 46 on the grounds that they fail to provide particulars and material facts giving rise to a cause of action; and
- paragraphs 41, 43, 44, and 45 on the basis that the allegations are irrelevant, and fail to provide particulars and material facts that give rise to a cause of action.
[30] For ease of reference, I will refer to the plaintiffs by counterclaim as the defendants, as they are identified in the main action. The defendants seek leave to amend any paragraphs of the counterclaim ordered struck.
[31] Paragraph 32 of the counterclaim is the prayer for relief. Paragraph 32(1) claims damages in the amount of $3,039,460.59 as a result of the plaintiff’s interference with the 2008 Hornepayne First Nation elections.
[32] The plaintiff submits that interference with an election and unlawful interference in the governance process do not constitute causes of action known to law and even if they did, the claim is statute-barred. I agree with this submission. Interference in an election or in governance is not a cause of action known to law. Even if the claim were known to law, it is out of time.
[33] The counterclaim was issued May 27, 2015, some seven years after the 2008 election. Section 4 of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B., stipulates the basic limitation period for proceedings commenced in Ontario is within two years of the day the cause of action arose. Accordingly, the defendants’ claim at paragraph 32(1)(a), (b), and (c), and paragraph 34 of the counterclaim alleging that they are owed damages for the plaintiff’s interference in the 2008 elections are struck without leave to amend.
[34] The allegations at paragraphs 32(3)(d), 35, 45, and 46 of the counterclaim that the plaintiff interfered with the internal governance of Hornepayne First Nation is also a claim unknown to law. These paragraphs are struck without leave to amend.
[35] The counterclaim also alleges that the plaintiff interfered with Hornepayne First Nation’s elections in July 2014. Even though these allegations are timely and not statute-barred, they do not give rise to a cause of action known to law. Therefore, paragraphs 36, 37, 38, and 42 are struck without leave to amend.
[36] In paragraphs 43 and 44 of the counterclaim, the defendants allege that the plaintiff approved Nuclear Waste Management Organization airborne survey activities in the Traditional Territory of Hornepayne First Nation without consultation or consent, to the plaintiff’s benefit. This is not a cause of action known to law. Accordingly, paragraphs 43 and 44 of the counterclaim are struck without leave to amend.
[37] The defendants claim punitive damages in the amount of $250,000.
[38] The allegations supporting the claims for punitive damages are that the plaintiff:
(1) made statements constituting defamation and injurious falsehood;
(2) made false or misleading statements tending to discredit the defendants; and
(3) used abusive and offensive behaviour to inflict emotional trauma upon the defendants.
[39] A defamatory statement is an untrue statement calculated to bring a person down in the eyes of respectable people. It is an attack on a person’s character and reputation.
[40] G.H.L. Fridman in The Law of Torts in Canada, (3d ed.), (Carswell, 2010, Thomson Reuters Canada Limited, Toronto), describes the nature of defamation at p. 611. He states:
Abuse per se is not defamatory. However if the abuse amounts to more than a mere insult it may satisfy the test of when a statement is defamatory. Defamatory matter is anything which brings the plaintiff into hatred, ridicule, or contempt, or tends to lower the plaintiff in the estimation of right-minded or right-thinking members of society generally, or cause people to shun or avoid the plaintiff.
[41] Paragraphs 39, 40, and 41 cite the plaintiff’s behaviour towards the Elders and community members at the time of the occupation that the defendants found abusive and offensive. This included playing loud music while the Elders were sleeping; placing notices on the vehicles of members of Hornepayne First Nation warning that the vehicles would be towed; disrespectful language and gestures; locking the Elders outside the premises; photographing members in the area of the premises; removing equipment used for cooking and food storage; and threats of litigation.
[42] While this conduct may have been distressing or even insulting to the defendants, it does not fall within the ambit of defamation. Even if defamatory statements had been made, which are not pleaded, the rules of pleading require that the statement be precisely pleaded, identifying the words spoken, the occasion on which they were spoken, and the defamatory meaning attached.
[43] The recitation of offensive or abusive conduct does not, in my view, satisfy the necessary elements for the tort of defamation. As Professor Fridman says, abuse is not defamatory.
[44] The defendants have also sued for the tort of injurious falsehood. Professor Fridman defines injurious falsehood as the modern form of slander of title. At p. 780 of The Law of Torts in Canada, he describes slander of title as an attack on the plaintiff’s title to land or property. No such allegations are made in the counterclaim.
[45] The allegations in paragraphs 39, 40, and 41 of the counterclaim are neither defamatory, nor do they give rise to a claim of injurious falsehood. Accordingly, they are struck.
[46] The defendants claim general damages of $150,000 in their prayer for relief. As there are no subsisting claims pleaded, the claim for general damages in paragraph 32(2) is struck as are the claims for prejudgment interest and costs found at paragraphs 32(2), 32(4) and 32(5) of the counterclaim.
[47] For the reasons set out above, the counterclaim cannot stand. It is struck in its entirety.
Costs
[48] If the parties cannot agree upon costs, an appointment may be obtained from the trial coordinator within 30 days of the release of these reasons to schedule a costs hearing, failing which costs will be deemed to be settled.
________”original signed by”
The Hon. Madam Justice H.M. Pierce
Released: October 28, 2015
CITATION: NAN Corporate Services v. Kocsis, 2015 ONSC 6651
COURT FILE NO.: CV-15-0213
DATE: 2015-10-28
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
NAN Corporate Services c.o.b. as Nishnawbe Aski Nation,
Plaintiff
- and -
Ron Kocsis, Isobel Clathworthy, Judy Mayhew, Margie Goulet, Rheal Twance, Robert Taylor, Beatrice Summer, Chelsy McGowan, Eva Wesley and Sarah Beckman,
Defendants
REASONS ON MOTION
FOR LEAVE TO APPEAL
Pierce J.
Released: October 28, 2015
/mls