NEWMARKET COURT FILE NO.: CV-15-124844-00
DATE: 20180403
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Tara McCarthy-Oppedisano, Plaintiff
AND:
Mary Muter, Defendant
BEFORE: THE HONOURABLE JUSTICE S.E. HEALEY
COUNSEL: C. Fiske and D. Cassin, Counsel, for the Plaintiff
C. Stribopoulos, Counsel, for the Defendant
HEARD: February 23, 2018
ENDORSEMENT ON MOTION
Nature of the Motion
[1] The moving party defendant, Mary Muter, seeks an order pursuant to section 137.1 of the Courts of Justice Act, R.S.O. 1990, c. C. 43 [CJA], dismissing this defamation action. Section 137.1 of the CJA was passed under the Protection of Public Participation Act, 2015 and came into force on November 3, 2015. It is referred to as “Anti-SLAPP legislation”.
[2] The structure and purpose of this legislation was concisely described by Brown, J. in Levant v. Day, 2017 ONSC 5956, at paras 2-3:
Section 137.1 of the CJA provides that where a proceeding is brought regarding a statement relating to a matter of public interest, a defendant may seek a preliminary judicial assessment of the merits of the claim. In a preliminary review under section 137.1 of the CJA, the defendant must establish that the impugned expression is on a matter of public interest. The plaintiff then bears the onus of showing that: (1) there are grounds to believe that his or her claim has substantial merit; (2) there are grounds to believe that the defendant has no valid defence; and (3) the harm that has been or is likely to be suffered by the plaintiff is sufficiently serious that the public interest in permitting the proceeding to continue outweighs the public interest in protecting that expression.
The purpose of sections 137.1-137.5 of the CJA are to encourage individuals to express themselves on matters of public interest; to promote broad participation in debates on matters of public interest; to discourage the use of litigation as a means of limiting expression on matters of public interest; and to reduce the risk that participation by the public in debates on matters of public interest will be hampered by fear of legal action: 1704604 Ontario Ltd. v. Pointes Protection Assn., 2016 ONSC 2884, para. 24.
[3] As explained in Levant, these motions are generally brought at an early stage in the proceedings in order to cull out frivolous claims that are intended to stifle public participation: para. 4.
[4] The motion in this action was brought approximately one year after the action was commenced. The statement of claim was issued on December 3, 2015. Pleadings closed in March 2016. In her statement of defence, Muter alleges that the entire action is a Strategic Lawsuit Against Public Participation (a “SLAPP suit”).
[5] The parties agreed on a litigation timetable in September, 2016. It required examinations for discovery to be completed by December 31, 2016. During the same week that discoveries were to take place in December, 2016, the defendant filed this anti-SLAPP motion.
The Evidence
[6] The plaintiff, Tara McCarthy-Oppedisano (“McCarthy”), lives in the Kingscross Estates (“Kingscross”), a residential community located in the Township of King, Ontario. She has been a real estate agent since 2013, and conducts business in the community of Kingscross. Her father, Peter McCarthy, is a prominent builder who has built many homes in Kingscross.
[7] The defendant Muter has lived in Kingscross since 2011. An avid environmentalist, her plan was to peacefully retire in the natural environment offered by this community, which includes wetlands, woodlots, fish lakes and watercourses. She also volunteers her time to sit as a board member on the Kingscross Ratepayers’ Association (“KRA”). KRA is a not-for-profit corporation, incorporated to promote the interests of Kingscross residents. Muter is strongly committed to the environment, and she believes that the value of Kingscross lies in preserving its natural environment. She is opposed to the construction of large homes, such as those that Peter McCarthy has been building.
[8] There are approximately 175 estate lots in Kingscross, each on approximately 2 acres of land. The lots were created and initially developed between the 1950s and the 1970s. Many of the homeowners have lived there for decades. One of the issues that KRA has been concerned with is the issue of developers purchasing property in the community at less than market value directly from owners, who may be unaware of their land’s true value, and then profiting by building large, “monster” homes. KRA also deals with issues affecting the community such as speed bumps and signage and, most recently, lot severance.
[9] Included in Muter’s material is an article titled “Seniors Must Be Wary When Selling Home”, published in the National Post newspaper on November 14, 2014, which discusses the issue of developers purchasing directly from owners at less than fair market value. She relies in part on this article to advance her argument that this was a subject of public interest in Kingscross.
[10] In May, 2015 McCarthy submitted an application to the Township of King to amend the Official Plan to sever two properties. The severance of the properties, one owned by her and one by her mother, would create one additional and separate lot. KRA is opposed to McCarthy’s application because it offends the Official Plan of the community and would create smaller lots. KRA also believes that the rezoning could have a detrimental ecological impact in the area.
[11] McCarthy’s application seems to have brought to a head the tensions in the community between those who share Muter’s interests and concerns, and those who either support broader choice with respect to development or who, for whatever reasons, do not share KRA’s agenda.
[12] In her capacity as co-chair of KRA, Muter says that she was charged with polling residents of Kingscross in early 2015 to determine their views concerning McCarthy’s application. At that point, McCarthy’s application had not been submitted to the Township’s planning department, but the residents had been made aware of her intention to do so. Muter had conversations with various residents regarding the application, in which she discussed KRA’s opposition to the reduction of lot sizes in Kingscross. As indicated above, some residents supported KRA, while others supported McCarthy’s application. The issue became public and quite heated. Community meetings were held. There was ongoing discussion in Kingscross about what the McCarthys wanted to do in the community.
[13] Rick Bedard, who has been a resident in Kingscross Estates for 19 years, gave evidence as a witness pursuant to Rule 39.03. He supports the position of the KRA board. His evidence was that the animosity between the two sides resulted in many residents being afraid to vote on KRA matters, intimidated to go to community meetings, and afraid to speak up.
[14] At some unidentified time, various real estate agents who were McCarthy’s competitors allegedly informed Muter that McCarthy had three real estate licence infractions, and that she was involved in blocking bids on home purchases in the area. Bedard also heard this rumor. He provided evidence that other Kingscross residents informed him that McCarthy was involved in blocking bids, and that her professional record contains infractions. Neither Muter nor Bedard would reveal the identities of the real estate agents or name the residents who provided such information.
[15] Lisa Iafrate is a resident of Kingscross. She and Muter used to be friends; Iafrate would dog-sit for Muter when necessary. In late February/early March, 2015, Muter went to Iafrate’s house. There is a conflict in the evidence about how and why this interaction came about. Muter says that she was invited to come there by Iafrate to discuss the details of the sale of Iafrate’s next door neighbour’s house. Muter also said that Iafrate called her and pleaded with her to tell her about what people in the community were discussing about McCarthy. Muter says that she told Iafrate that she did not like talking about rumours going around the neighbourhood. Yet she decided to go to Iafrate’s house to discuss McCarthy’s lot severance application, as she had not yet spoken to her about it. Muter’s evidence is that she intended to have a conversation with Iafrate to find out her views on the issue of “lot severances to below minimum lot size”. Iafrate’s evidence is that it was Muter who repeatedly asked to come over to her home during that period of time. She assumed it was because Muter wanted to repair damage caused to Iafrate’s home by her dog. Iafrate’s testimony is that she was very busy during that time and kept putting Muter off until the day in question.
[16] Unbeknownst to Muter, Iafrate recorded their conversation on her phone while Muter was in her home. Iafrate explained during her cross-examination that she recorded the conversation because she no longer liked Muter or the fact that Muter gossiped about others. Iafrate’s evidence is that Muter said negative things about McCarthy. Iafrate also depicted KRA’s board as consisting of several people who gossiped, and who were uninterested in change.
[17] During her examination for discovery, Muter did not deny speaking the words that are the subject of this lawsuit (the “Words Complained Of”). The Words Complained Of comprise 2 ½ pages in the statement of claim. For the sake of brevity, the Words Complained Of contain the following:
Anyways Tara I think had the other listing too, she ended up… who knows what going to happen to it all… but she ended up with her father wanting to buy both properties. And trying to stop other agents from putting in bids but she managed to get a competing bid for this property, your neighbour’s property and for the one on Manitou and she didn’t know how to deal with them. So she was phoning up other agents and asking them for help. And they refused to help her because she was wanting to sell them without any commission. And I don’t know if you have also heard but she has three infractions registered against her… Her real estate licence.
[18] Muter states that the Words Complained Of were conveyed to Iafrate as part of the overall discussion about what McCarthy wanted to do in Kingscross. She believed that she could tell Iafrate what she had heard about McCarthy from real estate agents in the community in complete confidence, as Iafrate had reassured her in the past that she would never breach that confidence.
[19] There are several things to be noted about the recording made by Iafrate. First, it is an incomplete recording of their conversation. Iafrate’s evidence is that the cell phone she used repeatedly stopped recording during their conversation. She would re-start the record function on her cell phone, but could not give any evidence about how much of the conversation remained unrecorded. Her evidence is that any conversation that occurred before the recording started was about damage done to her house by Muter’s dog. Muter’s evidence differs; she states that Iafrate led the conversation toward McCarthy’s application in the unrecorded portion of the recording. Muter recalls that there was a discussion about lot sizes and that Iafrate commented on McCarthy’s application.
[20] Second, Iafrate no longer has the recording in her possession, as she no longer has the cell phone used to record the conversation. Her evidence is that she sent the recording by text or email to Brian Prichard. Prichard is also a resident of Kingscross, who supports McCarthy’s application. There is no evidence on this motion from Prichard. Somehow the recording has been copied to a CD that is filed with McCarthy’s responding material, which has been transcribed. Iafrate has not authenticated the CD to be an accurate recording of her conversation with Muter, as she has never listened to it. Muter denies that it is an accurate and complete recording. She asserts that the full meaning and effect of their conversation is not reflected in the alleged recording relied on by McCarthy. However, she also asserts that the portion that is recorded establishes that the two women were discussing all manner of issues that were of interest to the public, and specifically to the residents of Kingscross.
[21] During the conversation a number of topics were discussed. After some small talk, it is Muter who first turned the conversation toward matters relevant to this lawsuit. She asked Iafrate “so you know the house next door to you sold?” Iafrate’s first response was “I know, so fast!”. A few moments later Iafrate said “so they sold already did they? I haven’t even spoken to them. Bless them, I love those people”. In the next sentence, Muter said “they’re nice people. Well, I am going to tell you some stuff that happened over this because I think you should know.” Iafrate’s response was “Oh?”
[22] Immediately after the exchange referred to in the preceding paragraph, Muter told Iafrate about a house on Manitou Street in Kingscross that had sold that week. Shortly thereafter, she advised Iafrate that McCarthy had the listing for the house on Manitou, just as she had been the listing agent on Iafrate’s next door neighbour’s house. As earlier referenced, this comment forms part of the Words Complained Of. Muter informed Iafrate that she had just spoken to her own agent, who told her that “those agents” whom McCarthy had contacted after receiving competing bids will probably file a complaint against McCarthy. Muter remarked that “they” had done a lot of favours, in response to Iafrate’s question about how McCarthy got the listing. “But then how did she get the confidence of the person that was selling the house if she’s so bad?”, asked Iafrate. Muter, after referencing the issue of the favours, stated “this is what we are finding out from a lot of people and now they’re saying, now we realize what’s been going on”.
[23] In the balance of the conversation, the women discussed other issues arguably of relevance to the residents of Kingscross, interspersed with small talk on topics of interest only to the two women. They talked about property values in Kingscross, McCarthy’s application and the McCarthy’s plans for building on the severed lots, the history of lot severances in the community, the possibility of increased density in Kingscross created by severance of existing lots, the potential impact of McCarthy’s application, speed bumps, the building of community gates, another member of the KRA board, the “very threatening letter” sent by Peter McCarthy to the KRA board, the circulation of a petition in the community to oppose the lot severance, and the circulation of a different petition regarding KRA’s representation of the landowners in Kingscross. Both women also gossiped and speculated about a number of individuals in the community during their conversation. Read in its entirety, the transcript leaves the impression that Iafrate was most interested in discussing a member of the board whom she dislikes, and who she believed was controlling the decision to hold a meeting to discuss the issue of lot severance. The transcript also leaves the impression that Muter’s primary objective during the conversation was to present her opposition to the idea of reduction of lot sizes through severance, and the potential precedent that would be set if McCarthy’s application was granted, by maligning and villifying McCarthy and her father.
[24] Iafrate states that she provided the recording to Prichard because the “current Board’s mandate was to stop progress in our community, to me it felt that they had been using community funds inappropriately. We had some fundraising to raise money for four feature walls in the front of our community, which Peter McCarthy completed on one end, and funds that we had in the account at that point would have completed the other feature walls on the Keele Street side.” Muter argues that Iafrate’s answer is significant because it shows that her purpose in secretly recording the conversation was to pressure KRA, which is a matter of public interest.
[25] Muter has denied disseminating the words to anyone but Iafrate. However the statement of claim alleges that “concurrent with, and then subsequent to, the initial rendering of the Defamatory Words, the defendant repeated the Defamatory Words to other persons.”
[26] There is evidence supporting the allegation of repeated defamation. Bedard, who is an ally of Muter on the board, provided evidence that Muter has spread rumours about McCarthy, and that he had told her not to do so. He admitted that he was disappointed in Muter for spreading gossip.
[27] Michael Notaro is a resident of Kingscross, and an affiant on behalf of McCarthy’s position. He too is a KRA board member. He has had occasion to question Muter about whether she has said negative things about McCarthy in her professional capacity. He took notes of his telephone conversation with Muter discussing this issue, which occurred in about May 2015. He initiated the call after being approached by the McCarthys, who complained to him about Muter’s conduct. Notaro’s notes indicate that Muter agreed that she had said “things” about McCarthy, that she did not know whether they were true, and that Notaro and Muter discussed that the gossip should stop. Muter’s remarks included that McCarthy was dishonest and had infractions on her licence. Notaro deposed that he advised Muter to stop making these remarks, as it was inappropriate given her position as a board member. His interactions in the community have led him to the conclusion that the comments made by Muter about McCarthy’s honesty and professional reputation is the subject of neighbourhood gossip.
[28] Another affiant, Mark Miller, has provided evidence that Muter called him to try to persuade him of her position. In doing so, she indicated to him that the McCarthy’s were “bad people”. Muter also informed him that McCarthy had infractions on her licence, and that she had been blocking bids. He has also heard other individuals in the community discussing Muter’s disparaging comments about McCarthy.
[29] Finally, Greg Donahue, another affiant, deposed that he was approached by Muter, who asked him to oppose McCarthy’s severance bid. Muter also told him that McCarthy was involved in blocking bids as an agent, that she could not be trusted, and that she has infractions. It is his evidence that he is neither anti- nor pro-severance and has no stake in the outcome of this matter.
[30] While Muter’s counsel raises arguments with respect to why these non-party witnesses should be discredited, I am not persuaded that their sworn evidence on these points should be disbelieved. The primary argument of counsel is that each witness supports the pro-severance position of McCarthy, and so their evidence is biased. First, that does not appear to be true where Donahue is concerned. However, as far as the other witnesses, and the parties, are concerned, the argument of self-interested partisanship applies equally to potentially taint the evidence of all.
[31] As a result of the divide in the community, Bedard arranged a lunch meeting in June 2015 between the parties for the purpose of attempting to clear the air. For the purposes of this decision, it is not necessary to review what occurred at that meeting in any detail. McCarthy alleges, however, that Muter continued to spread the defamatory remarks about her following that meeting. As a result, she commenced this lawsuit.
[32] Muter argues that the timing of the lawsuit highlights that it is a SLAPP proceeding. Elections for KRA’s board were scheduled for early October 2015. Muter was re-elected to the board. McCarthy, as well as Miller, were unsuccessful candidates. McCarthy’s application was scheduled to be heard at a planning meeting on December 7, 2015. Three days before that meeting, the statement of claim was served. Muter gave a short submission to the planning committee on behalf of KRA. The Township did not decide the issue at the planning meeting, and instead scheduled a further meeting for June 27, 2016. Muter was advised not to speak at the second planning meeting due to this lawsuit, and she remained silent.
The Test for Dismissal under Section 137.1
[33] Section 137.1 creates a simple two-part test. As set out in s. 137.1(3) of the CJA, the moving party must first establish two points:
(a) that the proceeding arises from an expression made by the moving party, and
(b) that the expression relates to a matter of public interest.
[34] If these two points are not established by the moving party, the motion must be dismissed. This is the only burden that the moving party must meet.
[35] If the moving party meets the burden under s. 137.1(3), the onus shifts to the responding party to satisfy each part of the test set out in s. 137.1(4) of the CJA, which states:
A judge shall not dismiss a proceeding under subsection (3) if the responding party satisfies the judge that,
(a) There are grounds to believe that,
(i) The proceeding has substantial merit, and
(ii) The moving party has no valid defence in the proceeding; and
(b) The harm likely to be or have been suffered by the responding party as a result of the moving party’s expression is sufficiently serious that the public interest in permitting the proceeding to continue outweighs the public interest in protecting that expression.
Were the Words Complained Of an Expression?
[36] While the parties disagree on whether the recording is accurate, they agree that the Words Complained Of are an expression that was made by Muter.
Do the Words Complained Of Relate to a Matter of Public Interest?
[37] The Supreme Court of Canada has considered the words “public interest” in the defamation context in Grant v. Torstar Corp., 2009 SCC 61, where it was defined the phrase as follows:
To be of public interest, the subject matter “must be shown to be one inviting public attention, or about which the public has some substantial concern because it affects the welfare of citizens, or one to which considerable public notoriety or controversy has attached”… Public interest may be a function of the prominence of the person referred to in the communication, but mere curiosity or prurient interest is not enough. Some segment of the public must have a genuine stake in knowing about the matter published (para. 105).
[38] In Grant the court directed that a judge must consider the subject matter of the publication as a whole in determining whether it relates to a matter of public interest. Rather than scrutinizing the defamatory statement in isolation, the judge’s role is to determine whether the subject matter of the communication as a whole is one of public interest: para. 101.
[39] Decisions of this court on anti-SLAPP motions have drawn guidance from Grant when considering the words “public interest” under section 137.1 of the CJA: Veneruzzo et al. v. Storey, 2017 ONSC 683, at paras. 26- 30; Levant v. Day, at para. 22; Able Translations Ltd. v. Express International Translations Inc., 2016 ONSC 6785, at para. 26.
[40] It is the subject-matter of the communication, determined objectively and reasonably, that is the object of the inquiry in s. 137.1(3), and not the motives of the speaker. The first part of the analysis is to determine objectively what the subject matter of the communication is as a whole and then to consider whether the subject matter can fairly be described as a matter of public interest: Able Translations, at paras. 24 and 27.
[41] The court’s task when assessing whether the moving party has met its onus under s. 137.1(3) has been succinctly described by Dunphy, J. in Able Translations, at para. 25:
Mr. Vitu is not disentitled from holding opinions or expressing them simply because they involve a competitor directly or indirectly. Competitors are not disentitled from having opinions on matters of public interest or from expressing them. If the subject matter of the communication is objectively and reasonably found to relate to a matter of public interest in its pith and substance, the defendants have met their evidentiary burden. In such cases, the issue of motive arises in relation to the second phase of the inquiry under s. 137.1(4) of the CJA and in particular s. 137.1(4)(b). There is no reason to fear that wolves in sheep’s clothing will pass by undetected. The determination of the true subject matter of the expression is to be made objectively and reasonably. Where the pith and substance of the matter is a defamatory personal attack thinly veiled as a discussion of matters of public interest, the court has all the tools it requires to determine the true nature of the expression and rule accordingly.
The Positions of the Parties
[42] Muter’s counsel argues that the discussion between Muter and Iafrate, considered as a whole, raised issues of public interest. They discussed McCarthy’s role as a real estate agent doing something to affect property values in Kingscross, which is of interest to the community. The comments that Muter relayed to Iafrate regarding McCarthy are simply comments that she has heard relayed in the community from other individuals, including unidentified real estate agents. Throughout the conversation, Muter was acting in her role as co-chair of KRA. Muter’s counsel argues that it is not proper to isolate the Words Complained Of from the rest of the conversation, which deals with all manner of issues that are of concern to the community. Insofar as Muter’s alleged comments to Donahue and Miller about McCarthy’s infractions and conduct in blocking bids, and her admission to Notaro that she had said such things, he argues that this evidence should be disbelieved or given little weight.
[43] Counsel for the plaintiff argues that Muter is attempting to use her position as a co-chair to influence how others viewed McCarthy. It should not be permitted, he argues, for a member of a voluntary community organization to be able to shelter behind that position in order to make defamatory comments about the professional reputation of a private citizen. The anti-SLAPP provisions are intended to protect persons who speak on matters of public interest, but are not to be used to shield those who pretend that there is a public dimension to what are nothing more than defamatory personal attacks.
Analysis
Is the Public Interest Test Met?
[44] As the law requires, the first part of the public interest analysis is to objectively determine what the subject matter of the communication is as a whole. As far as the conversation between Muter and Iafrate is concerned, there is no question that the two women are talking, generally, about political, economic and social matters that have arisen in the Kingscross community, including McCarthy’s severance application. It is in this context that the impugned comments are made about McCarthy. Muter’s conversations with the other three men seem to have arisen out of Muter’s role as a co-chair of the board, but the subject matter of the impugned comments is McCarthy, or McCarthy and her father.
[45] The second part of the analysis is to consider whether the subject matter can be characterized as a matter of public interest. Unlike other cases that have considered s. 137.1, Muter did not say the Words Complained Of in reaction or complaint to the acts or omissions of an individual in the discharge of his or her public duties: see, for example, McLaughlin v. Maynard, 2017 ONSC 6820, Niagara Peninsula Conservation Authority v. Smith, 2017 ONSC 6973, and Rizvee v. Newman, 2017 ONSC 4024. In those types of cases, it is easy to recognize how the public would have a strong interest in the exchange of ideas respecting the actions or merits of those who hold office or who are candidates for public office. The case before me is different in that it is person who holds an elected position who spoke the Words Complained Of, and who repeated their essence to others, while she held that position.
[46] It is true that the Kingscross community appears to have had widespread interest in the topic of McCarthy’s severance proposal, and that Muter was involved in the concerns raised by it both on a personal level and as a co-chair of the board. What is not germane to that public interest, however, is sheer gossip about McCarthy’s integrity or ethics in her chosen profession. McCarthy’s personal and professional reputation is not remotely connected to the public’s interest in the potential result or impact of the severance application.
[47] Nor are the allegations about McCarthy allegedly blocking bids connected to the other issue having a public interest component, which is direct sales to developers at less than market value. There is no evidentiary link between this allegation and a proposed development by Peter McCarthy. In other words, there is no evidence that the two listings about which these allegations were made were the subject of a proposed development. Muter was unconcerned about whether the comments that she was passing on to others about McCarthy were true or not, and admits that she did not attempt to verify their accuracy. With respect to McCarthy’s alleged infractions, this would have been a simple matter of checking the publicly available online records of the Real Estate Council of Ontario, as McCarthy has demonstrated in her material. Muter’s lack of concern about the veracity of the gossip that she was so readily relaying to others about McCarthy supports the view that the allegations are nothing more than personal attacks, repeated and passed on to others for political advantange.
[48] I do not accept that the law seeks to allow immunity from liability for an elected member of a voluntary organization who embeds defamatory comments within political, economic or social commentary that touches upon matters of public interest. This is how the conversation between Muter and Iafrate can be characterized, as well as the remarks made to Miller, Donahue and Notaro. Where such comments serve no purpose other than to malign the professional and personal reputation of another person, and have no relevance to issues that have a public interest component, the words should not be protected. The allegations that McCarthy is involved in a scam to block bids, and that she has infractions on her real estate licence, do not amount to public speech as they are unrelated to matters in which the Kingscross residents have demonstrated an interest. They are spurious, idle allegations that serve no public interest.
[49] The plaintiff has satisfied the court that the Words Complained Of do not amount to a matter of public interest, and therefore the motion is dismissed.
[50] If the parties are unable to agree to the costs of this motion they may provide brief written submissions to me through the office of the judicial assistants in Barrie. The plaintiff’s are due by April 13, 2018, the defendant’s by April 18, 2018, and any reply by April 20, 2018. All submissions are to be no longer than three double-spaced pages in length, attaching cost outlines, offers to settle, and any case law relied upon by the party.
Healey, J.
Date: April 3, 2018