Crown Crest Financial Corp. v. Sabbah

COURT FILE NO.: CV-19-623185 DATE: 2019/12/09

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Crown Crest Financial Corp. Plaintiff

• and -

ERIC SABBAH Defendant

COUNSEL: F. Paul Morrison and Ben Peel for the Plaintiff Brian N. Radnoff and Dylan E. Augruso for the Defendant

HEARD: November 25, 2019

PERELL, J.

REASONS FOR DECISION

A. Introduction

[1] In this action, the Plaintiff, Crown Crest Financial Corp., alleges that the Defendant, Eric Sabbah, who is a licensed paralegal, unlawfully obtained its confidential business records and misused the information to recruit 14 claimants to sue Crown Crest in 15 Small Claims Court actions.

[2] Crown Crest alleges that Mr. Sabbah wrongfully induced the claimants, (Crown Crest’s clients) to sue Crown Crest in Small Claims Court for breaches of contracts to sell or lease to them heating, ventilation and air conditioning ("HVAC") equipment. Crown Crest alleges that Mr. Sabbah acts for the claimants in the Small Claim Court proceedings and that he will be paid for his services by a fee that will see him share in the outcome of the Small Claims Court actions. Crown Crest alleges that Mr. Sabbah misrepresented the law to induce the claimants to sue Crown Crest.

[3] In this action, Crown Crest advances against Mr. Sabbah causes of action for defamation, unjust enrichment, abuse of process, maintenance and champerty, inducing breach of contract, and intentional interference with economic relations. However, Crown Crest is withdrawing all of those causes of action except: (a) inducing breach of contract; and (b) intentional interference with economic relations.

[4] Pursuant to rule 21.01 (b) of the Rules of Civil Procedure,[^1] Mr. Sabbah seeks an order striking out the claims for inducing breach of contract and intentional interference with economic relations without leave to amend for not showing a reasonable cause of action. Mr. Sabbah also asks that the Statement of Claim be struck out as an abuse of process.

[5] For the reasons that follow, I grant Mr. Sabbah’s motion. I, however, grant leave to Crown Crest to deliver a Fresh as Amended Statement of Claim limited to torts with respect to breach of privacy or breach of confidence.

B. Statement of Claim

[6] Crown Crest’s Statement of Claim is set out below:

CLAIM

1. The Plaintiff Crown Crest Financial Corp. ("Crown Crest") claims:

(a) general damages in an amount to be determined;

(b) special, punitive and exemplary damages in an amount to be determined; inducing breach of contract, and intentional interference with economic relations.

(c) an Order staying the following Small Claims Court actions (the "Small Claims Actions"), pursuant to section 106 of the Courts of Justice Act, RSO 1990, c. C.43 (the "Courts of Justice Act”);

(i) (Bishundeo v. Simply Smart et al, SC190001797000 (Toronto); Plaintiff: Kemraj Bishundeo; Defendants: Simply Smart, Simply Green Home Services and Ontario Consumers Home Services

[(ii) – (xiv)]

(xv) Qiyang v. Ontario Consumer Home Services et al SC-1800120720000; Plaintiff: Richard Qiyang; Defendant: Ontario Consumer Home Services Inc.

(d) a declaration that the Small Claims Actions are without merit;

(e) in the alternative, an Order transferring and consolidating the Small Claims Actions from Small Claims Court to the Ontario Superior Court of Justice, further to section 107 of the Courts of Justice Act;

(f) prejudgment interest in accordance with section 128 of the Courts of Justice Act;

(g) post-judgment interest in accordance with section 129 of the Courts of Justice Act;

(h) costs and disbursements on a substantial indemnity basis; and

(i) such further and other relief as counsel may advise and this Honourable Court deems just.

The Parties

2. Crown Crest is a financial services corporation, providing such services to corporations that sell or lease heating, ventilation and air conditioning ("HVAC") or HVAC-related equipment to individual consumers. Crown Crest is incorporated pursuant to the laws of Ontario with its head office in Toronto.

3. The defendant Eric Sabbah ("Sabbah") is a licensed paralegal in the province of Ontario. Sabbah represents individual plaintiffs (the Small Claims Plaintiffs) in at least 15 Plaintiff's claims in Small Claims Court in Toronto and the Greater Toronto Area (the "Small Claims Actions").

The Agreements

4. Between 2012 and 2018, at least 14 individuals (the "Small Claims Plaintiffs") each entered into one or more rental agreements (the "Agreements") with a number of companies including Ontario Consumers Home Services Inc., Simply Comfort Inc., and Consumers Choice Comfort Services Inc. (the "Vendor Companies"), for the supply, installation and maintenance of HVAC equipment and related products (the "Equipment").

The Third-Party Verification Calls

5. Before entering into the Agreements, the Small Claims Plaintiffs each participated in verification calls with a third-party (the "TPV Call") to ensure and confirm their understanding of the terms of the Agreements. During the TPV Calls, the Small Claims Plaintiffs confirmed their understanding:

(a) of the equipment being leased;

(b) of the equipment leasing provider;

(c) of the amount of the monthly rental payment;

(d) that rental charges will be included under the Other Company Section of the utility bill;

(e) that the Equipment will be fully covered under warranty for all parts and labour for the full term;

(f) of their right to cancel the contract during the 10-day cooling off period;

(g) that the Small Claims Plaintiffs had been provided with a copy of their Agreement;

(h) that the sales representative who attended upon them was wearing a uniform with a visible ID badge;

(i) that the Small Claims Plaintiffs had a positive experience with the sales representative; and

(j) that the Small Claims Plaintiffs were aware of the availability of a customer care telephone support line.

6. None of the Small Claims Plaintiffs cancelled their Agreements within the 10-day cooling off period. Nor did any of them otherwise contact Crown Crest to complain about the performance or functioning of the Equipment.

7. Pursuant to the terms of the Agreements, the Small Claims Plaintiffs agreed to pay the stated monthly rental payment, for the duration of the term as set out in the Agreements.

8. The Vendor Companies supplied, installed and maintained the Equipment, in accordance with the requisite standards of professionalism and workmanship.

9. The Small Claims Plaintiffs at all times made the required monthly payments pursuant to the terms of the Agreements, and did not cancel the Agreements, or complain about the Equipment or service they received pursuant to the Agreements.

10. Crown Crest is the successor in interest to the Vendor Companies' interest in the Agreements. It has upheld each of the terms of the Agreements since taking assignment thereof.

11. Crown Crest has received no complaints from any of the Small Claims Plaintiffs with respect to the Agreements.

Sabbah Commences the Small Claims Actions

12. There were no breaches of the Agreements by any of the Small Claims Plaintiffs, the Vendor Companies, or Crown Crest, between 2012 and 2018.

Sabbah is not a party to the Agreements.

13. Sabbah, or a third party acting in concert or a joint plan with Sabbah, obtained confidential and sensitive business records belonging to Crown Crest, by unlawful means, to determine the identities of the Small Claims Plaintiffs. These records include information regarding the Small Claims' Plaintiffs addresses and names, and the terms of their Agreements with Crown Crest.

14. In or about 2018, the Small Claims Plaintiffs were solicited by Sabbah or an affiliated third party or organization, and pressured or induced to commence the Small Claims Actions, for Sabbah's own gain. Sabbah will share in any recovery from the Small Claims Actions.

15. Sabbah falsely and for his own gain misrepresented to the Small Claims Plaintiffs that the Agreements were unlawful and/or that they could recover a windfall if they commenced the Small Claims Actions. As a result, Crown Crest was served with the 14 plaintiffs' claims in the Small Claims Actions in or about February and March 2019, each of which alleges that the Agreements are not valid and seeks damages as a result.

Intentional Interference with Contractual Relations

16. Sabbah knew that the Small Claims Plaintiffs had entered into the Agreements with Crown Crest and its predecessors in interests. Sabbah, without justification, took steps to persuade, induce and/or pressure them to commence the Small Claims Actions.

17. The statements made by Sabbah were intended to mislead the Small Claims Plaintiffs about the terms of their Agreements, and their entitlements at law.

18. As a result of Sabbah's conduct in inducing the commencement of the Small Claims Actions, Sabbah has unlawfully interfered with the contractual relations of the Small Claims Plaintiffs with Crown Crest, causing Crown Crest to suffer loss and damage.

19. Sabbah intended to harm Crown Crest in so doing. He knew or ought to have known that the Small Claims Actions would not only cause the damage to Crown Crest with respect to the valid Agreements, but that its reputation would be harmed as a result, leading to tl1e loss of customers in a competitive retail environment.

20. Sabbah gained an unlawful economic benefit as a result of commencing the Small Claims Actions on behalf of the Small Claims Plaintiffs.

Defamation

22. [withdrawn]

Maintenance and Champerty

23. [withdrawn]

Unjust Enrichment

24. [withdrawn]

Abuse of Process

25. [withdrawn]

Damages

27. As a result of Sabbah's conduct, and the conduct of affiliated parties who conspired with Sabbah, Crown Crest has suffered and will continue to suffer damages, including but not limited to, loss of the value of the Agreements, loss of business, costs of the Small Claims Actions, and loss of reputation and goodwill.

28. Sabbah should not be entitled to profit from his conduct. Sabbah's actions are malicious and high-handed and constitute a wanton disregard for Crown Crest's rights for which Crown Crest is entitled to an award of aggravated, punitive and exemplary damages.

General

29. Crown Crest seeks its costs of this proceeding on a substantial indemnity basis.

30. Crown Crest proposes that this matter be tried at Toronto.

C. Striking Claims for Failure to Show a Reasonable Cause of Action

[7] Mr. Sabbah’s motion is brought pursuant to rule 21.01 (1)(b) and 21.01 (3)(d) of the Rules of Civil Procedure, which state:

WHERE AVAILABLE

To any Party on Question of Law

21.01 (1) A party may move before a judge,

(a) […]

(b) to strike out a pleading on the ground that it discloses no reasonable cause of action or defence, and the judge may make an order or grant judgment accordingly.

(2) No evidence is admissible on a motion, …

(b) under clause (1)(b).

To Defendant

(3) A defendant may move before a judge to have an action stayed or dismissed on the ground that,

Action Frivolous, Vexatious or Abuse of Process

(d) the action is frivolous or vexatious or is otherwise an abuse of the process of the court,

and the judge may make an order or grant judgment accordingly.

[8] Where pursuant to rule 21.01 (1)(b), a defendant submits that the plaintiff’s pleading does not disclose a reasonable cause or action, to succeed in having the action dismissed, the defendant must show that it is plain, obvious, and beyond doubt that the plaintiff cannot succeed in the claim.[^2] Matters of law that are not fully settled should not be disposed of on a motion to strike, and the court's power to strike a claim is exercised only in the clearest cases.[^3]

[9] In R. v. Imperial Tobacco Canada Ltd.,[^4] the Supreme Court of Canada noted that although the tool of a motion to strike for failure to disclose a reasonable cause of action must be used with considerable care, it is a valuable tool because it promotes judicial efficiency by removing claims that have no reasonable prospect of success and it promotes correct results by allowing judges to focus their attention on claims with a reasonable chance of success.

[10] On a motion under rule 21.01 (1)(b), the court accepts the pleaded allegations of fact in the statement of claim as proven, unless they are patently ridiculous or incapable of proof.[^5]

[11] The failure to establish a cause of action usually arises in one of two ways: (1) the allegations in the statement of claim do not come within a recognized cause of action; or (2) the allegations in the statement of claim do not plead all the elements necessary for a recognized cause of action.[^6] If a material fact necessary for a cause of action is omitted, the statement of claim is bad and the remedy is a motion to strike the pleadings, not a motion for particulars.[^7]

[12] On motions brought under the procedure to strike a claim or defence as untenable in law, leave to amend the pleading may and usually will be given, and leave to amend will only be denied in the clearest cases when it is plain and obvious that no tenable cause of action is possible on the facts as alleged and there is no reason to suppose that the party could improve his or her case by any amendment.[^8]

D. Discussion and Analysis

1. Introduction and the Untenable Claims for Relief

[13] On this motion, the question to be determined is whether it is plain and obvious that Crown Crest has not and could not plead a legally viable cause of action for: (a) inducing breach of contract and/or, (b) intentional interference with economic relations.

[14] Below, I conclude that it is plain and obvious that these causes of action are not legally viable on grounds of public policy. Because of this conclusion it is, strictly speaking, not necessary to consider Mr. Sabbah’s argument that the Statement of Claim should be struck as an abuse of process.

[15] Nevertheless, as I shall explain below, in the immediate case, the causes of action for inducing breach of contract and for intentional interference with economic relations are an abuse of process because they depend upon the inadmissible evidence of the privileged communications between Mr. Sabbah and the 15 Small Claims Court claimants.

[16] Before beginning the explanation as to why there is no viable causes of action for: (a) inducing breach of contract; and (b) intentional interference with economic relations and in order to not skew the analyses of these causes of action with other legal problems, it is necessary to point out an underlying serious problem with Crown Crest’s Statement of Claim.

[17] The point to note is that even assuming that these causes of action were reasonable causes of action, in no circumstances would these causes of action entitle Crown Crest to an Order staying 14 Small Claims Court Actions or to a declaration that the Small Claims Court actions are without merit, as claimed in paragraphs 1(c) and 1(d) of Crown Crest’s Statement of Claim. And, even assuming that these causes of action were legally viable, in no circumstances would Crown Crest be entitled to the relief claimed in paragraph 1(e) of the Statement of Claim for an order transferring and consolidating the Small Claims Court actions to the Superior Court of Justice.

[18] The 15 Small Claims Court claimants are not before this Court, and the Small Claims Court claimants are not proper nor necessary parties to Crown Crest’s causes of action for inducing breach of contract or intentional interference with economic relations.

[19] Thus, in any event of this motion, paragraphs 1(c), 1(d), and 1(e) should be struck from the Statement of Claim, and, these claims for relief may not be reiterated if Crown Crest delivers a Fresh as Amended Statement of Claim.

[20] I now turn to the explanations as to why the causes of action for (a) inducing breach of contract and (b) intentional interference with economic relations should be struck without leave to amend.

E. The Cause of Action of Inducing Breach of Contract

[21] The elements of a claim of inducing breach of contract are: (1) the plaintiff is a party to a valid and enforceable contract; (2) the defendant is aware of the contract and its terms; (3) the defendant intends to procure a breach of the contract; (4) the defendant persuades or induces a contracting party to breach the contract with the plaintiff; and, (5) the plaintiff suffers damages as consequence of the breach of the contract.[^9]

[22] A review of the Statement of Claim, set out above, reveals that Crown Crest has pleaded the constituent elements of a cause of action of inducing breach of contract as against Mr. Sabbah. Thus, it cannot be said that it is plain and obvious that Crown Crest’s claim for this tort is legally untenable on account of a failure to plead a reasonable cause of action. The pleading of the cause of action is not the problem in the immediate case. That said, it does not follow that Mr. Sabbah’s motion under rule 21.01 to strike the cause of action for inducing a breach of contract should be dismissed.

[23] As I will next discuss, there are public policy reasons and a line of authorities that preclude negligence actions against lawyers (or, in the immediate case, licensed paralegals) that are involved in litigation as legal counsel for their clients, and in my opinion, it is plain and obvious that this case law should be extended to the circumstances of the immediate case.

[24] In the immediate case, Crown Crest is involved in litigation with Mr. Sabbah’s clients and with respect to those 14 Small Claims court actions, Mr. Sabbah has a third-party relationship with Crown Crest. While he is not a lawyer, Mr. Sabbah, like a lawyer, is licensed by the Law Society of Ontario to practice law, and in my opinion, he is entitled to the public policy immunity that he cannot be sued because of the advice he gave for the litigation of his clients.

[25] Historically, the public policy immunity of which I speak has been made available in cases where a litigant sues his or her opponent’s lawyer for negligence or breach of fiduciary duty. In the immediate case the litigant (Crown Trust) sues the legal representative (Mr. Sabbah) of his or her opponent’s, the 15 Small Claims Court claimants.

[26] An action in negligence against a litigant’s adversary’s legal counsel for negligence or for breaches of ethical duties, will be struck out on the grounds that a lawyer has no duty of care to his client’s adversary in litigation. However, the action will also be struck out on public policy grounds.

[27] The public policy prohibiting such claims is that they would interfere with the loyalty relationship between a litigant and his or her legal representative and would encourage re-litigation of the dispute between the litigants and collateral attacks on the judgments reached in the dispute between the litigants.[^10]

[28] In German v. Major,[^11] Justice Kerans of the Alberta Court of Appeal stated at paragraph 58 in a case where pleadings in an action against a lawyer were struck:

58. The trial-as-a-contest of which I speak requires, in our tradition, a champion. The loyalty of counsel to clients traditionally has no bounds save to be honest and respectful. It would be a remarkable alteration in the adversary system for counsel for one party in litigation to be accountable to the other party for the conduct in good faith of the litigation. The duty of counsel is to represent his client's interests; the law should not impose a conflicting duty upon him.

[29] The same public policy rationale should apply to the circumstances of the immediate case where a claim against a legal representative is made for allegedly inducing his or her client’s breach of contract by giving misleading legal advice. In the immediate case Crown Crest pleads in paragraph 15 of its Statement of Claim that Mr. Sabbah falsely misrepresented, i.e., gave fallacious advice, to the Small Claims claimants that the Agreements were unlawful and/or that they could recover a windfall if they commenced the Small Claims Actions.

[30] Removing the allegedly unlawful way that Mr. Sabbah recruited his clients, what he did in the immediate case is what lawyers often do, which is to advise clients about their rights under a contract and to take instructions to bring or defend legal proceedings.

[31] It cannot be the case that a lawyer’s or licensed paralegal’s providing legal advice about a contract is an inducement to breach a contract, but more to the point, the same public policy grounds that apply to a negligence claim should apply in the circumstances of the immediate case, which are, practically speaking, not much different from the circumstances of a negligence claim against an adversary’s legal representative. In either case, the possibility of a claim interferes with lawyer and client relationships and disrupts the loyalty that a lawyer owes to his or her client. The possibility of a claim by a litigant against the lawyer acting for his adversary because of the advice that the lawyer gives his or her client would make the adversary system unworkable.

[32] The potential embarrassment to the administration of justice of an action for inducting breach of contract based on the representation and legal advice of a lawyer or licensed paralegal is demonstrated by Balagula v. Ontario Consumers Home Services.[^12] (In the immediate case, there are 14 pleaded Small Claims Court actions that are analogous to the Balagula case.)

[33] The defendant in the Balagula case is one of the HVAC vendors noted in paragraph 4 of Crown Crest’s Statement of Claim. Crown Crest is the successor in interest to Ontario Consumers Home Services. In the Balagula case, Justice Conway dismissed Ontario Consumers Home Services appeals from a Small Claims Court judgment awarding Mr. Balagula $17,334.09, plus costs of $2300.

[34] Regardless of the outcome in the Balagula case, which is to say that regardless of whether or not Mr. Balagula had been successful, it would be a collateral attack on the judgment reached in the case to sue the lawyer or paralegal that advised Mr. Balagula about his contract with Ontario Consumers Home Services.

[35] Moreover, apart from the public policy that stands against Crown Crest’s cause of action for inducing breach of contract, insofar as the cause of action depends upon the alleged material fact of fallacious communications between Mr. Sabbah and the 15 Small Claims Court claimants, Crown Crest’s action is an abuse of process.

[36] The point is demonstrated by Frank v. Legate.[^13] The plaintiff, Dr. Frank, was an obstetrician and gynecologist. The defendants, Barbara Legate, Joni Dobson, Keith Finley and Legate & Associates LLP, were the lawyers for 60 women who had retained them to pursue civil claims against Dr. Frank. She sued the lawyers for, among other things, intentional infliction of economic loss. She alleged that but for the statements and misrepresentations made by the lawyers to their clients, the legal proceedings against her would not have been commenced and the consequent economic loss that she suffered would not have occurred. By analogy, Dr. Frank’s claim against the lawyers is similar to the claims being advance by Crown Crest in the immediate case against Mr. Sabbah.

[37] In the Frank case, in a judgment upheld by the Ontario Court of Appeal, Dr. Frank’s claim against the lawyers was struck as an abuse of process because the cause of action relied on inadmissible evidence. At paragraph 83, Justice Hourigan stated for the Court of Appeal:

83 […] I also agree with the finding of the motion judge that in order to understand the nature of the misrepresentations and whether the clients relied upon them, the appellant would need to lead evidence of the privileged communications between the respondents and their clients. Consequently, this claim was properly struck under rule 25.11 [as an abuse of process] as it relies on inadmissible evidence.[^14]

[38] In Stanfield v. Schneider,[^15] another case involving striking a claim against lawyers and also a claim against them for inducing breach of contract, Master Robertson of the Alberta Court of Queen’s Bench stated at paragraph 53:

53. The allegation of inducing breach of contract is made on the premise that the Low defendants advised Ms. Schneider to breach the contract. This inevitably would require reviewing privileged communications. It is untenable that an opposing party could force the waiver of privilege simply by asserting the tort of inducement of breach of contract. That runs completely counter to the jealously guarded right of a client and lawyer to communicate in private, and for the lawyer to provide advice to the client, all with confidence that the communications will remain private.

[39] I agree with Master Robertson’s comments. I also agree with Master Robertson’s comments at paragraph 56 of the decision:

56. Lawyers regularly advise their clients about breaching contracts. This is what happens regularly when an employer seeks advice about the termination of an employee's employment. The advice is, in essence, "Terminating the employment without notice and without cause is a breach of contract and in my opinion the damages for the breach will be $X." If the client chooses to breach the contract and suffer the consequences, the lawyer is not liable to the dismissed employee for providing candid legal advice. The lawyer may draft the letter terminating the employment. However, the claim for damages is against the employer. That does not change simply because the former employee is offended by the termination.

[40] In the immediate case, it is plain and obvious that on public policy grounds and because it would be an abuse of process, the cause of action for inducing breach of contract should be struck without leave to amend.

F. The Cause of Action of Intentional Interference with Economic Relations

[41] A defendant commits the tort of an intentional interference with economic relations when: (a) he or she commits an unlawful act against a third party (i.e., an act that would be actionable if the third party had suffered loss); and, (b) he or she intends to economically harm the plaintiff or he or she intentionally harms the plaintiff for some ulterior purpose. This intentional tort is available even if the plaintiff has another claim against the defendant arising from the alleged misconduct. The tort allows a plaintiff to sue a defendant for economic loss resulting from the defendant’s unlawful act against a third party.[^16]

[42] In the immediate case, in the context of Crown Crest’s cause of action for intentional interference with economic relations, with respect to the first constituent element of the cause of action, it is alleged that Mr. Sabbah committed an unlawful act against a third party; i.e., in this context, against the Small Claims Court claimants who are his clients.

[43] The unlawful means element of the tort of intentional interference with economic relations requires the existence of conduct by the defendant (Mr. Sabbah) that supports a civil action by a third party (the Small Claims Court claimants) against the Mr. Sabbah. In the present case, this would require the existence of unlawful conduct that is actionable by the Small Claims claimants as against Mr. Sabbah.

[44] In the immediate case, the main alleged unlawful conduct of Mr. Sabbah is that of misrepresenting the law to his clients, the claimants in the Small Claims Court proceedings. Thus, Crown Crest submits in its factum for this motion:

34. To that end, Crown Crest submits that Sabbah purposefully misled the Small Claims Plaintiffs to induce them into commencing proceedings against Crown Crest. Specifically, he misled them to believe that the Agreements were unlawful and/or that they could recover a windfall if they commenced the Small Claims Actions

[45] Thus, it appears that the cause of action these third parties would have is a cause of action in negligence or negligent misrepresentation, i.e., professional negligence in giving his clients advice about their claims in Small Claims Court proceedings.

[46] Crown Crest alleges a second type of misconduct by Mr. Sabbah as against the third parties; i.e., the persons who he represents in the Small Claims Court actions. He submits that Mr. Sabbah has intruded on the claimant’s seclusion. Thus, in his factum he submits:

1. Moreover, Sabbah has wrongly obtained and misused Crown Crest’s and the Small Claims Plaintiffs’ confidential information. This tort of intrusion upon seclusion is actionable by the Small Claims Plaintiffs against Sabbah, and therefore satisfies the unlawful means element of the tort.

2. The elements of the tort of intrusion upon seclusion are: (i) The defendant’s conduct must be intentional or reckless; (ii) The defendant must have invaded the plaintiff’s private affairs or concerns without lawful justification; and (iii) A reasonable person would regard the invasion as highly offensive, resulting in distress, humiliation or anguish to the plaintiff.[^17]

[47] In the immediate case, save for what I said above about the cause of actions in the immediate case being an abuse of process in so far as it depends upon privileged communications, I accept that Crown Crest has adequately pleaded a claim for intentional interference with economic relations and that the wrongful act constituent elements of that tort can be satisfied by a breach of confidence or an intrusion on seclusion.[^18]

[48] However, for the same public policy reasons, discussed above with respect to Crown Crest’s cause of action for inducing breach of contract, it is plain and obvious that a cause of action for intentional interference with economic relations against a lawyer or paralegal that in its essence is about the advice the lawyer or paralegal gave his or her clients for court proceedings is not available to Crown Crest.

[49] Moreover, for the same reasons discussed above with respect to the potential use of privileged lawyer and client communications, it is plain and obvious that Crown Crest’s cause of action for intentional interference with economic relations is an abuse of process.

G. Should Leave to Amend be Granted to Crown Crest

[50] Crown Crest has abandoned its causes of action for defamation, unjust enrichment, abuse of process, and maintenance and champerty. For public policy reasons and as an abuse of process, I am striking the causes of action for (a) inducing breach of contract, and (b) intentional interference with economic relations. No purpose would be served in granting Crown Crest leave to amend to plead these causes of action.

[51] However, from an analysis of the material facts pleaded, it appears that Crown Crest may be able to plead a cause of action for the alleged breach of its privacy and for a misappropriation of its confidential or proprietary information. It appears that privacy torts were committed before Mr. Sabbah entered into a licensed paralegal and client relationship with the claimants in the Small Claims Court actions.

[52] I, therefore, grant leave to Crown Crest to deliver a Fresh as Amended Statement of Claim to plead these causes of action.

H. Conclusion

[53] For the above reasons, I strike the totality of Crown Crest’s Statement of Claim. I, however, grant leave to Crown Crest to deliver a Fresh as Amended Statement of Claim limited to torts with respect to breach of privacy or for breach of confidence.

[54] If the parties cannot agree about the matter of costs, they may make submissions in writing beginning with Mr. Sabbah’s submissions within twenty days of the release of these Reasons for Decision followed by Crown Crest’s submissions within a further twenty days.

Perell, J.

Released: December 9, 2019

[^1]: R.R.O. 1990, Reg. 194. [^2]: Dawson v. Rexcraft Storage & Warehouse Inc. (1998), 1998 CanLII 4831 (ON CA), 164 D.L.R. (4th) 257 (Ont. C.A.); Hunt v. Carey Canada Inc. (1990), 1990 CanLII 90 (SCC), 74 D.L.R. (4th) 321 (S.C.C.). [^3]: Dawson v. Rexcraft Storage & Warehouse Inc. (1998), 1998 CanLII 4831 (ON CA), 164 D.L.R. (4th) 257 (Ont. C.A.); Temelini v. Ontario Provincial Police (Commissioner) (1990), 1990 CanLII 7000 (ON CA), 73 O.R. (2d) 664 (C.A.). [^4]: 2011 SCC 42 at paras. 17-25. [^5]: Folland v. Ontario (2003), 2003 CanLII 52139 (ON CA), 64 OR (3d) 89 (C.A.); Nash v. Ontario (1995), 1995 CanLII 2934 (ON CA), 27 O.R. (3d) 1 (CA); Canada v. Operation Dismantle Inc., 1985 CanLII 74 (SCC), [1985] 1 S.C.R. 441; A-G. Canada v. Inuit Tapirisat of Canada, 1980 CanLII 21 (SCC), [1980] 2 S.C.R. 735. [^6]: 2106701 Ontario Inc. (c.o.b. Novajet) v. 2288450 Ontario Ltd., 2016 ONSC 2673 at para. 42; Aristocrat Restaurants Ltd. v. Ontario, [2004] O.J. No. 5164 (S.C.J.); Dawson v. Rexcraft Storage & Warehouse Inc., 1998 CanLII 4831 (ON CA), [1998] O.J. No. 3240 at para. 10 (C.A.). [^7]: Balanyk v. University of Toronto, 1999 CanLII 14918 (ON SC), [1999] O.J. No. 2162 (S.C.J.); Regional Plaza Inc. v. Hamilton-Wentworth (Regional Municipality) (1990), 1990 CanLII 6761 (ON SC), 12 O.R. (3d) 750 (Gen. Div.); Copland v. Commodore Business Machines Ltd. (1985), 1985 CanLII 2190 (ON SC), 52 O.R. (2d) 586 (Master), appeal dismissed (1985), 52 O.R. (2d) 586n (H.C.J.). [^8]: Mitchell v. Lewis, 2016 ONCA 903 at para. 21; Conway v. Law Society of Upper Canada, 2016 ONCA 72 at para. 16; Sheridan v. Ontario, 2015 ONCA 2281; 1523428 Ontario Inc. v. TDL Group Corp., 2018 ONSC 5886 (S.C.J.); Adelaide Capital Corp. v. Toronto-Dominion Bank (c.o.b. TD Canada Trust), 2006 CanLII 39459 (ON SC), [2006] O.J. No. 4705 at para. 6 (S.C.J.), varied 2007 ONCA 456, [2007] O.J. No. 2445 at para. 6 (C.A.); Miguna v. Ontario (Attorney General), 2005 CanLII 46385 (ON CA), [2005] O.J. No. 5346 (C.A.). [^9]: Alleslev-Krofchak v. Valcom, 2010 ONCA 557; Correia v. Canac Kitchens (2008), 2008 ONCA 506, 91 O.R. (3d) 353 (C.A.); Drouillard v. Cogeco Cable Inc., (2007), 2007 ONCA 322, 86 O.R. (3d) 431 at para. 26 (C.A.); Daishowa Inc. v. Friends of the Lubicon (1996), 1996 CanLII 11767 (ON SC), 27 O.R. (3d) 215 (Div. Ct.); Lumley v. Gye (1853), 2 E & B 216, 22 L.J.Q.B. 463. [^10]: MacDonald v. MCAP Service Corp., 2013 ONSC 4473; Hamid v. Milaj, 2013 ONSC 2104; Hillier v. Hutchens, 2012 ONSC 5988; Boldt v. Law Society of Upper Canada, 2010 ONSC 3568; King v. Kahane-Rapport, [2009] O.J. No. 1345 (S.C.J.); Shuman v. Ontario New Home Warranty Program, [2001] O.J. No. 4102 (S.C.J.); Brignolio v. Desmarais, Keenan, [1995] O.J. No. 3499 (Gen. Div.), affd. [1966] O.J. No. 4812 (C.A.), leave to appeal to S.C.C. refd [1996] S.C.C.A. No. 326; Geo. Cluthe Manufacturing Co. v. ZTW Properties Inc. (1995), 1995 CanLII 10684 (ON SC), 23 O.R. (3d) 370 (Div. Ct.); Al-Kanderi v. J.R. Brown & Co., [1988] 1 All E.R. 833 (C.A.); Stanfield v. Schneider, 2017 ABQB 543 (Master). [^11]: 1985 ABCA 176. [^12]: 2018 ONSC 5398. [^13]: 2015 ONCA 631. [^14]: See also Stanfield v. Schneider, 2017 ABQB 543 at para. 53 (Master). [^15]: 2017 ABQB 543 at para. 53 (Master) [^16]: A.I. Enterprises Ltd. v. Bram Enterprises Ltd., 2014 SCC 12. [^17]: Jones v. Tsige, 2012 ONCA 32. [^18]: Fundraising Initiatives Inc. v. Globalfaces Direct Inc, 2015 ONSC 1334