COURT FILE NO. 114/18

DATE: 20210331

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Cory Savary and Kings Custom Homes Incorporated

Plaintiffs

– and –

Tarion Warranty Corporation, Ian Bulloch, Danny Conte, Adil Darr, John Doe #1 (Tarion investigator), John Doe #2 (Tarion investigator), Tanya Gibson, Bell Media, CTV News, Heather Wright, Josh Elliot, The Corporation of the Township of Douro-Dummer, Jardine Lloyd Thompson Canada Inc., Dave Clifford, Ken Currie, Brian Fawcett, Kar Moher, Murray Jones, The Corporation of the Township of Asphodel-Norwood, Frank Cowan Company and Stewart Morrison Insurance, Candace White, Ed Whitmore, The Corporation of the Township of Otonabee-South Monaghan, BFL Canada Risk and Insurance Services Inc., Barb Waldron, Chantal Simmons, Peterborough Public Health, and Kathleen Shepherd

Defendants

Cory Savary in person, and for Kings Custom Homes Incorporated

Michael Owsiany, for Tarion Warranty Corporation, Ian Bulloch, Danny Conte, Adil Darr, and Tanya Gibson

Emma Romano, for Bell Media, CTV News, Heather Wright and Josh Elliott

John Lloyd, for The Corporation of the Township of Douro-Dummer, Dave Clifford, Ken Currie, Brian Fawcett, Karl Moher and Murray Jones

George Pakozdi, for The Corporation of the Township of Asphodel-Norwood, Candace White and Ed Whitmore

John Ewart for The Corporation of the Township of Otonabee-South Monaghan, Barb Waldron and Chantal Simmons

John McIntyre and Heather Webster, for Peterborough Public Health and Kathleen Shepherd

HEARD: December 7, 8 and 9, 2020

S.T. Bale J.

Table of Contents

Overview.. 3

Motions to strike statement of claim.. 3

Tests under rule 21.01. 3

Test under rule 25.11. 4

Claims for declaratory relief. 4

Statutory claims. 6

Wilful and public incitement of hatred. 6

Terrorism.. 6

Competition Act 7

Security of Information Act 8

Injurious falsehood. 8

Tarion. 9

Douro-Dummer. 10

CTV News. 11

Otonabee-South Monaghan. 11

Intentional interference with economic relations. 12

Inducing breach of contract 12

Tarion. 13

CTV News. 13

Conspiracy. 13

Tarion. 14

Douro-Dummer. 15

CTV News. 16

Asphodel-Norwood. 17

Otonabee-South Monaghan. 17

Peterborough Public Health. 17

Negligence. 19

Tarion. 19

Douro-Dummer. 21

CTV News. 21

Peterborough Public Health. 21

Discrimination and harassment 22

Punitive, exemplary and aggravated damages. 23

Damages Generally. 24

Additional issues. 24

CTV News - merger. 24

Peterborough Public Health – Vicarious liability. 26

Peterborough Public Health – Statutory immunity. 27

Leave to amend. 28

Overview

[1] Each of five groups of defendants moves for an order striking out all or part of the statement of claim. The motions are made under rules 21.01 and 25.11 of the Rules of Civil Procedure.

[2] The five groups of defendants are the following:

Tarion Warranty Corporation, Ian Bulloch, Danny Conte, Adil Darr, Tanya Gibson, John Doe #1 and John Doe #2 (referred to in these reasons as "Tarion");

Bell Media, CTV News, Heather Wright and Josh Elliott (referred to in these reasons as "CTV News");

The Corporation of the Township of Douro-Dummer, Dave Clifford, Ken Currie, Brian Fawcett, Karl Moher and Murray Jones (referred to in these reasons as "Douro-Dummer");

The Corporation of the Township of Asphodel-Norwood, Candace White and Ed Whitmore (referred to in these reasons as "Asphodel-Norwood");

The Corporation of the Township of Otonabee-South Monaghan, Barb Waldron and Chantal Simmons (referred to in these reasons as "Otonabee-South Monaghan); and

Peterborough Public Health and Kathleen Shepherd (referred to in these reasons as "Peterborough Public Health").

[3] The remainder of the named defendants are parties against which no claim is made. The action against some or all of them may have already been dismissed. In the event that the plaintiffs seek to deliver an amended statement of claim, the names of all parties against whom no claim is made will be deleted from the title of proceeding.

[4] For the reasons that follow, the statement of claim is struck out in its entirety, but with leave to move for an order permitting delivery of a fresh statement of claim, in accordance with the directives set out in these reasons.

Motions to strike statement of claim

Tests under rule 21.01

[5] Pursuant to rule 21.01(1)(a), a party may move for the determination of a question of law raised by a pleading where the determination may dispose of all or part of the action, substantially shorten the trial, or result in a substantial saving of costs.

[6] Pursuant to rule 21.01(1)(b), a party may move to strike out a pleading on the ground that it discloses no reasonable cause of action or defence. The test for striking a statement of claim at the pleadings stage is a stringent one, with a difficult burden for defendants to meet. In order to succeed, the moving party must show that "it is plain, obvious and beyond doubt that the plaintiff could not succeed": Eliopoulos v. Ontario (Minister of Health & Long Term Care) (2006), 2006 CanLII 37121 (ON CA), 82 O.R. (3d) 321 (C.A.), at para. 8.

[7] All facts pleaded are assumed to be true, unless they are patently ridiculous, manifestly incapable of proof or amount to bald conclusory statements, unsupported by material facts: Transamerica Life Inc. v. ING Canada Inc. (2003), 2003 CanLII 9923 (ON CA), 68 O.R. (3d) 457, at para. 38; R. v. Imperial Tobacco Canada Ltd., 2011 SCC 42, at paras. 21f; Castrillo v. Workplace Insurance Safety Board, 2017 ONCA 121, at para. 15. However, a critical analysis is required to prevent untenable claims from proceeding, given "this age of scarce judicial resources and systemic delay": Rayner v McManus, 2017 ONSC 3044, at paras. 25-26 (Div. Ct.).

[8] The pleading must be read generously to allow for drafting deficiencies and the plaintiff's lack of access to key documents and discovery information. The court should err on the side of permitting an arguable claim to proceed to trial. Cases that are unique or novel, that involve matters of law that are unsettled or that require a detailed analysis of the evidence should not be resolved without a full factual record: Rausch v. Pickering (City), 2013 ONCA 740, at para. 34.

[9] Pursuant to rule 21.01(3)(d), a defendant may move to have an action stayed or dismissed on the ground that the action is frivolous or vexatious or is otherwise an abuse of the process of the court.

Test under rule 25.11

[10] Pursuant to rule 25.11, the court may strike out or expunge all or part of a pleading, with or without leave to amend, on the ground that the pleading (a) may prejudice or delay the fair trial of the action; (b) is scandalous, frivolous or vexatious; or (c) is an abuse of the process of the court.

[11] A claim may be found to be frivolous, vexatious or an abuse of process when it asserts untenable pleas, is argumentative, contains insufficient material facts to support the allegations made, contains prolix, vague, repetitive or redundant allegations, or allegations simply inserted for colour or to impugn the behaviour or character of the other party, unrelated to the issues in the litigation: Stedfasts v. Dynacare Laboratories, 2019 ONSC 6626, at para. 34.

Claims for declaratory relief

[12] The plaintiffs claim a raft of declarations in their prayers for relief:

• a declaration that Tarion and Tarion staff unnecessarily targeted, discriminated against, harassed, publicly incited hatred, and wilfully promoted hatred against Kings Custom Homes Incorporated and Cory Savary;

• a declaration that Tarion and Tarion investigators conspired and colluded with numerous municipalities and certain officials of those municipalities, Bell Media, and purchasers of Kings Custom Homes, to intentionally interfere with the economic relations of Kings Custom Homes Incorporated and did so with malicious intent;

• declaration that Tarion failed in its contractual obligations and thereby breached its contract and made void by fraud the contract with Cory Savary and Kings Custom Homes Incorporated;

• a declaration that Tarion and Tarion staff did commit a terrorist act against Cory Savary and Kings Custom Homes Incorporated;

• a declaration that The Township of Douro-Dummer, Murray Jones, Karl Moher, Dave Clifford, Ken Currie and Brian Fawcett conspired with and knowingly participated with Tarion in a terrorist act against Cory Savary and Kings Custom Homes Incorporated and continues to do so;

• a declaration that Bell Media, CTV News, Heather Wright and Josh Elliot knowingly conspired, colluded, and participated with Tarion in a terrorist act against Cory Savary and Kings Custom Homes Incorporated;

• a declaration that The Township of Otonabee-South Monaghan and CBO Barb Waldron did knowingly conspire with and participate with Tarion in a terrorist act against Cory Savary and Kings Custom Homes Incorporated and continues to do so; and

• a declaration that Peterborough County Health and Kathleen Shepherd did actively participate, collude, and conspire with Peterborough County CBOs Ken Currie, Barb Waldron, Brian Fawcett, and Tarion in a terrorist act against Cory Savary and Kings Custom Homes Incorporated.

[13] These claims show a misunderstanding of the nature and function of declaratory relief. The rule confirming the availability of such relief is set out in s. 97 of the Courts of Justice Act:

The Court of Appeal and the Superior Court of Justice, exclusive of the Small Claims Court, may make binding declarations of right, whether or not any consequential relief is or could be claimed [emphasis added].

[14] "A declaration confirms or denies the existence of a right, as if bearing witness to what has always been the legal relationship between the disputing parties. Put that way, it is an existential judgment that considers rights to be or not to be": Lazar Sarna, The Law of Declaratory Judgments, 4th ed. (Toronto: Thomson Reuters, 2016), at p. 54. In the present case, the "declarations" requested by the plaintiffs are not judicial statements of right; but rather, findings of fact which they plead in support of their claims for damages. While such facts, if material, may be contained in the body of a pleading, they are not the proper subject of a claim for declaratory relief.

[15] "An application for a declaration will be rejected if it seeks confirmation of a breach of statute, since it would serve no useful purpose and the application itself constitutes an abuse of process": Sarna, at p. 159.

[16] The claims for declaratory relief will therefore be struck, pursuant to rule 21.01(1)(a), without leave to amend. These include the claims in paragraphs 1(a), 1(b), 1(c), 1(g) (relating to Tarion), paragraph 77(l) (relating to Douro-Dummer), paragraph 140(j) (relating to CTV News), paragraph 163(g) relating to Otonabee-South Monagahan, and 174 (e) (relating to Peterborough Public Health).

Statutory claims

[17] The plaintiffs make a number of claims based on statute. They argue that it is "well known" that a breach of statute is a tort. I disagree. There is no free-standing cause of action in tort for breach of a statute: see Mohammed v. Her Majesty the Queen in Right of Ontario, 2019 ONSC 532, at para 33.

[18] A number of the plaintiffs' claims are based on criminal legislation. They say that they realise that in this action, the defendants cannot be found guilty on the criminal standard of proof beyond a reasonable doubt, but argue that the court may find the defendants to be "guilty/liable" on "the lower standard". Again, I disagree. There is no lower standard of criminal liability, and a defendant cannot be found guilty of a criminal offence in a civil action. See: London Health Science Centre v. R.K., 1997 CanLII 14487 (ON SC), at para. 18, and A.B. v. Canada (Attorney General), 2017 ONSC 3759, at para. 67.

Wilful and public incitement of hatred

[19] In addition to the declaration claimed in paragraph 1(a), the plaintiffs plead that Tarion publicly incited hatred against them (paragraph 72), and wilfully promoted hatred against them (paragraphs 4, 7, 71 and 74).

[20] Public incitement of hatred is an offence under s. 319(1) Criminal Code: the Crown must prove, beyond a reasonable doubt, that the accused incited hatred against an identifiable group by communicating statements in any public place, where such incitement is likely to lead to a breach of the peace.

[21] Wilful incitement of hatred is an offence under s. 319(2) Criminal Code: the Crown must prove beyond a reasonable doubt that the accused, by communicating statements other than in private conversation, wilfully promoted hatred against an identifiable group.

[22] "Identifiable group" is defined in s. 318(4) of the Code as any section of the public distinguished by colour, race, religion, national or ethnic origin, age, sex, sexual orientation, gender identity or expression, or mental or physical disability.

[23] It is plain and obvious that the allegations of inciting hatred do not disclose a cause of action against Tarion and they will therefore be struck out, without leave to amend.

Terrorism

[24] In their claim for relief against Tarion, the plaintiffs claim a declaration that Tarion committed a terrorist act against the plaintiffs.

[25] In their claims for relief against Douro-Dummer, CTV News and Otonabee-South Monaghan, the plaintiffs claim a declaration that each of them conspired and knowingly participated with Tarion in a terrorist act against the plaintiffs.

[26] In their claim for relief against Peterborough Public Health, the plaintiffs claim a declaration that it actively participated, colluded and conspired with Tarion and several township chief building officials in a terrorist act against the plaintiffs.

[27] These claims include no references to statute and no further references to terrorism. However, in oral argument, the plaintiffs cited s. 83.01 of the Criminal Code, and the Safe Streets and Communities Act which provides for a civil remedy for victims of terrorism.

[28] The definition of "terrorist activity" is contained in s. 83.01(1)(b) of the Code, and the offence of facilitating terrorist activity is contained in s. 81.19 of the Code. The terrorism provisions are contained in Part II.1 of the Code.

[29] The Safe Streets and Communities Act enacted, among other things, the Justice for Victims of Terrorism Act. Under s. 4 of the Justice for Victims of Terrorism Act, any person who has suffered loss or damage, as a result of an act or omission punishable under Part II.1 of the Criminal Code, may bring an action to recover an amount equal to the loss or damage proved to have been suffered and obtain any additional amount that the court may allow.

[30] The plaintiffs argue that the denial of building permits constitutes a terrorist act because housing is an essential service. They also argue that the defendants have interfered with their ability to obtain certain contracts in the oil and gas and nuclear industries, and that such interference constitutes a terrorist act.

[31] For the purpose of these reasons, I need not set out in detail the elements of "terrorist activity". Suffice it to say that it is plain and obvious that the defendants in this case have not facilitated any such activity. All references to terrorism in the statement of claim will be struck out, without leave to amend. These include paragraphs 1(g) (relating to Tarion), 77 (l) (relating to Douro-Dummer), 140(j) (relating to CTV News), 163(g) (relating to Otonabee-South Monaghan) and 174(e) (relating to Peterborough Public Health).

Competition Act

[32] In their claim for relief against Tarion, the plaintiffs claim damages for violations of the Competition Act. They go on to plead the following:

32. Tarion intended to stop Kings from advancing their business by falsifying information to intentionally discredit and potentially bankrupt the company, putting Kings Custom Homes in a strained and disadvantageous position with respect to builders in the marketplace, violating the Competition Act. Further particulars will be provided at trial.

[33] In their claims for relief against Douro-Dummer and CTV News, the plaintiffs claim damages "for violations under the Competition Act in an amount to be determined prior to trial." They go on to plead the following:

82. The Township of Douro Dummer and certain staff did conspire with Tarion to stop Kings from advancing their business by falsifying information to intentionally discredit and potentially bankrupt the company, putting Kings Custom Homes in a strained and disadvantageous position with respect to builders in the marketplace, violating the Competition Act. Further particulars will be provided at trial.

The same allegation is made against CTV News in paragraph 146 of the statement of claim.

[34] Under s. 36 of the Competition Act, any person who has suffered loss or damage as a result of conduct that is contrary to any provision of Part VI (Offences in Relation to Competition) of the Act may sue for and recover from the person who engaged in the conduct an amount equal to the loss or damage proved to have been suffered.

[35] For the purpose of these reasons, I need not set out in detail the offences contained in Part VI of the Act. Suffice it to say that the plaintiffs have not referred to any particular offence and it is plain and obvious that the defendants have not committed any such offences. All references to the Competition Act in the statement of claim will be struck out, without leave to amend. These include paragraphs 1(p) and 32 (relating to Tarion), 77 (h) and 82 (relating to Douro-Dummer), and 140(f) and 146 (relating to CTV News).

Security of Information Act

[36] In their claims for relief against Tarion, Douro-Dummer and CTV News, the plaintiffs claim damages for violations of the Security of Information Act. They go on to plead that those defendants: "violated the rights of Cory Savary and Kings Custom Homes Incorporated under the Security of Information Act." They plead that Tarion "commit[ted] an act of economic espionage against Kings Custom Homes and Cory Savary."

[37] However, the Security of Information Act does not provide for civil remedies. It is legislation that creates a series of offences relating to Canada's national security, including economic espionage. It is therefore plain and obvious that the allegations involving the Act do not disclose a cause of action. All references to the Security of Information Act in the statement of claim will therefore be struck out, pursuant to rule 21.01(1)(a), without leave to amend. These include paragraphs 1(q), 33 and 34 (relating to Tarion), 77 (g) and 81 (relating to Douro-Dummer), and 140(g) and 142 (relating to CTV News).

Injurious falsehood

[38] There are four elements to the tort of injurious falsehood, Lysko v. Braley (2006), 2006 CanLII 11846 (ON CA), 79 O.R. (3d) 721 (C.A.), at paras. 133f, Angus Inc. v. Beretta Farms Brands Ltd., 2020 ONSC 2557, at para. 34. They are:

• that the defendant published false statements, either orally or in writing, which reflected adversely on the plaintiff's business or property, or title to property;

• that in making the statements, the defendant intended to induce others not to deal with the plaintiff;

• that the statements were made maliciously without just cause or excuse; and

• that subject to s. 17 of the Libel and Slander Act, as a result of the making of the statements, the plaintiff suffered special damages in the form of pecuniary loss.

[39] Under s. 17 of the Libel and Slander Act, in an action for malicious falsehood, it is not necessary to allege or prove special damage,

(a) if the words upon which the action is founded are calculated to cause pecuniary damage to the plaintiff and are published in writing or other permanent form; or

(b) if the words upon which the action is founded are calculated to cause pecuniary damage to the plaintiff in respect of any office, profession, calling, trade or business held or carried on by the plaintiff at the time of the publication.

[40] Where fraud, misrepresentation, breach of trust, malice or intent is alleged, the pleading will contain full particulars, but knowledge may be alleged as a fact without pleading the circumstances from which it is to be inferred: rule 25.06(8).

Tarion

[41] At paragraph 1(l) of the statement of claim, the plaintiffs claim $20,000,000 in damages from Tarion for injurious falsehood. The pleaded facts that would appear to be the basis of this claim are the following:

• that Tarion provided false and misleading statements to numerous municipalities, purchasers and Durham Regional Police Service to deter them from doing business with, or cooperating with, the plaintiffs (paragraphs 3, 4, 8, 26);

• that as a result of the false allegations made to purchasers, several of them breached their contracts with the plaintiffs (paragraph 7);

• that in making misrepresentations to municipalities, Tarion intended to deter them from obtaining building permits and financing; and that as a result, numerous municipalities have refused to issue building permits, and continue to do so (paragraphs 9 and 10);

• that the representations are untrue, misleading and continue to occur (paragraph 11);

• that the misleading statements to "many parties" have caused "numerous parties" to defame the plaintiffs, and others to commit violent crimes against the plaintiff, causing damage to the plaintiffs' business and reputation (paragraph 12);

• that Tarion's untrue and misleading statements have somehow caused internet companies to damage the plaintiffs' business and reputation (paragraph 14);

• that Tarion has on numerous occasions falsely stated that the plaintiffs are frauds and don't actually build homes (paragraph 19);

• that Tarion staff member Ian Bulloch falsely alleged that the plaintiffs' builder's licence had previously been revoked (paragraph 20);

• that Tarion staff member Ian Bulloch has falsely stated that many purchasers from the plaintiffs are without homes because the plaintiffs forced them to sell their existing homes and then refused to build them new homes (paragraph 23);

• that Tarion staff members falsely told numerous purchasers that the plaintiffs did not have subdivision approvals and that there were no plans to obtain approvals (paragraph 28);

• that Tarion staff members falsely advised municipalities that there was no doubt that the plaintiffs were illegally building numerous homes in different family member names in order to skirt the Tarion warranty process (paragraphs 29 and 53);

• that Tarion since 2015 has been misleading townships and others by providing false and misleading information and statements about the plaintiffs, in order to deter them from doing business with Kings: including that houses will never be completed, Cory Savary is a fraud, and Cory Savary is violent and aggressive; and that such false statements have in fact induced many parties to refuse to do business with the plaintiffs, and induced townships to impose unfair restrictions on permit issuance, or to simply continue to refuse to issue permits (paragraph 41);

• that Tarion's false allegations have caused numerous parties to refuse to finance or cancel financing for projects, causing a loss of nearly $400,000 in real estate deposits (paragraph 42);

• that Tarion has falsely alleged that Cory Savary is a criminal and has committed many criminal acts, including fraud (paragraph 50);

• that on November 20, 2018, Tarion staff member Tanya Gibson made false statements to the public "diminishing the life and businesses" of the plaintiffs (paragraph 66); and

• that Tarion staff member Tanya Gibson falsely alleged that Cory Savary is an illegal builder (paragraph 68).

[42] While I agree that some of these allegations may potentially support a claim in malicious falsehood, each of them suffers from one or more of the following deficiencies:

• failure to identify the words alleged to constitute the injurious falsehood;

• failure to allege malice or to provide full particulars of the allegations of malice (see rule 25.06(8) and Beretta Farm Brands, at para. 36);

• failure to identify the entities to whom the false statements were made;

• failure to identify the contracts alleged to have been breached as a result of the false statements;

• failure to identify the building permits refused to be issued; and

• failure to provide particulars of the damages alleged to have been suffered.

[43] For these reasons, the paragraphs of the statement of claim relating to injurious falsehood as against Tarion will be struck out, including, 1(l), 3, 4, 7, 8, 9, 10, 11, 12, 14, 19, 20, 23, 26, 28, 29, 41, 42, 50, 53, 66 and 68.

Douro-Dummer

[44] At paragraph 77(c) of the statement of claim, the plaintiffs claim $10,000,000 in damages from Douro-Dummer for injurious falsehood. While it is unclear what facts are relied upon, the plaintiffs do plead the following:

• that "certain staff" of Douro-Dummer falsified information to discredit and potentially bankrupt the plaintiff corporation (paragraph 82);

• that Ken Currie repeatedly claimed that Cory Savary was a liar (paragraph 94);

• that Ken Currie provided a perjured affidavit and slandered the title to the property of Cory Savary falsely claiming that the home was poorly built (paragraphs 100, 108 and 110); and

• that Ken Currie provided redacted documents to "falsify a truth" (paragraph 101).

[45] These paragraphs suffer from one or more of the deficiencies referred to above in relation to Tarion and will therefore be struck out.

CTV News

[46] At paragraph 140(c) of the statement of claim, the plaintiffs claim $10,000,000 in damages from CTV News for injurious falsehood. The pleaded facts that would appear to be the basis of this claim are the following:

• that CTV News and Heather Wright falsified information to discredit and potentially bankrupt the plaintiff corporation (paragraph 146);

• that CTV News and Heather Wright made false and untrue statements about the plaintiffs and broadcast those statements with malicious intent (paragraph 148); and

• that CTV News aired false statements about the plaintiffs to injure their ability to obtain financing, and as a result, "companies" have refused to provide or cancelled financing (paragraph 149).

[47] While I agree that these allegations may have potential to support a claim in malicious falsehood, each of them suffers from one or more of the following deficiencies:

• failure to identify the "falsified information" and false and untrue statements;

• failure to provide particulars of the financing alleged to have been lost.

[48] For these reasons, paragraphs 146, 148 and 149 of the statement of claim will be struck out.

Otonabee-South Monaghan

[49] At paragraph 163(d) of the statement of claim, the plaintiffs claim $10,000,000 in damages from Otonabee-South Monaghan for injurious falsehood. The pleaded facts that would appear to be the basis of this claim are the following:

• that CBO Barb Waldron made numerous false statements about the plaintiffs (paragraph 165);

• that on August 15th, 2017, CBO Barb Waldron made false representations about Cory Savary to injure the business and reputation of the plaintiffs (paragraph 167); and

• that Barb Waldron and Chantal Simmons misled purchasers and others by stating that Cory Savary repeatedly removed an order to comply and stop work order from the properties of the plaintiff corporation (paragraphs 169 and 170);

[50] While I agree that these allegations may have potential to support a claim in malicious falsehood, each of them suffers from one or more of the following deficiencies:

• failure to identify the words alleged to constitute the injurious falsehood;

• failure to allege malice or to provide full particulars of the allegations of malice (see rule 25.06(8) and Beretta Farm Brands, at para. 36);

• failure to identify the entities to whom the false statements were made; and

• failure to provide particulars of the damages alleged to have been suffered.

Intentional interference with economic relations

[51] The plaintiffs allege intentional interference with economic relations as against all defendant groups.

[52] The parameters of the tort of intentional interference with economic relations are described in A.I. Enterprises Ltd. v. Bram Enterprises Ltd., 2014 SCC 12, at para. 23, as follows:

The unlawful means tort creates a type of "parasitic" liability in a three-party situation: it allows a plaintiff to sue a defendant for economic loss resulting from the defendant's unlawful act against a third party. Liability to the plaintiff is based on (or parasitic upon) the defendant's unlawful act against the third party. While the elements of the tort have been described in a number of ways, its core captures the intentional infliction of economic injury on C (the plaintiff) by A (the defendant)'s use of unlawful means against B (the third party).

[53] The defendant's unlawful act against the third party must be an actionable civil wrong, or conduct that would be actionable, if it had caused loss to the person at whom it was directed: Bram Enterprises at para. 26. The court illustrates the tort, at para. 24, with the following example:

An old case will serve as an example. The defendant, the master of a trading ship, fired its cannons at a canoe that was attempting to trade with its competitor, the plaintiffs' trading ship, in order to prevent it from doing so. The defendant was held liable, Lord Kenyon being of the opinion that these facts supported an action: Tarleton v. M'Gawley (1793), Peake 270, 170 E.R. 153. The plaintiffs were able to recover damages for the economic injury resulting from the defendant's wrongful conduct toward third parties (the occupants of the canoe) which had been committed with the intention of inflicting economic injury on the plaintiffs.

[54] The difficulty with the plaintiffs' pleading of intentional interference with contractual relations is that they do not, in relation to their claims against any of the defendant groups, plead that those defendants committed an unlawful act against a third party (or each other) that would have been actionable, had the unlawful conduct caused damage to that third party.

[55] In these circumstances, I find that it is plain and obvious that the pleading of intentional interference with economic relations does not disclose a cause of action. All references to that cause of action in the statement of claim will therefore be struck out, without leave to amend. These include the references in paragraphs 1(b), 1(i), 2, 10, 14, 16, 17, 27, 37, 42, 44, 47, 48 and 49 (relating to Tarion), paragraphs 77(a), 78, 90, 91, 94, 104 and 122 (relating to Douro-Dummer), paragraphs 140(a), 141, 144, 151 and 152 (relating to CTV News), paragraphs 155(a) and 161 (relating to Asphodel-Norwood), paragraphs 163(a) and 164 (relating to Otonabee-South Monaghan), and paragraphs 174(a) and 175 (relating to Peterborough Public Health).

Inducing breach of contract

[56] In order to establish that the defendants are liable for inducing breach of contract, the plaintiffs must prove:

• that a valid and enforceable contract existed;

• that the defendants knew of the existence of the contract;

• that the defendants committed an intentional act to cause a breach of that contract; and

• that the plaintiffs suffered damages as a result.

See Midland Resources Holding Ltd. v. Shtaif, 2014 ONSC 997, at para. 1143.

Tarion

[57] The plaintiffs claim damages of $20,000,000 from Tarion for inducing breach of contract.

[58] Tarion argues that it is "untenable that purchasers were both part of a conspiracy against the plaintiffs and were induced to breach contracts with the plaintiffs." I disagree. If Tarion drew purchasers into the conspiracy for the purpose of causing them to breach their contracts, and the purchasers both joined the conspiracy and breached their contracts, I see no reason why Tarion could not be held liable for inducing breach of contract.

[59] Tarion also argues that the claim for inducing breach of contract should be struck because it alleges that Tarion induced "unparticularized purchasers to breach unparticularized contracts with the plaintiffs." I agree. Paragraphs 1(m), 7 and 39 of the statement of claim will therefore be struck out.

[60] In the event that the plaintiffs seek to deliver an amended statement of claim, any claim for inducing breach of contract must include: the date of the contract; the names of the parties to the contract; the subject-matter of the contract; the actions alleged to have induced the breach; the date of the breach; the nature of the breach; and the damages alleged to have been suffered as a result of the breach.

CTV News

[61] While the CTV News prayer for relief does not include a specific claim for inducing breach of contract, at paragraphs 143-144 of the claim, the plaintiffs allege Heather Wright interviewed individuals who were not purchasers from the plaintiff corporation and knew, or ought to have known, that this "would induce breach of contract." These paragraphs will be struck out for the same reasons as the claim for inducing breach of contract against Tarion has been struck out.

Conspiracy

[62] The plaintiffs claim damages from all defendant groups for conspiracy.

[63] In Ontario Consumers Home Services v. Enercare Inc., 2014 ONSC 4154, at para. 24, the court set out the elements of the tort of conspiracy which must be pleaded with "precision and clarity":

• the parties to the conspiracy and their relationship to each other;

• the agreement between or among the defendants to conspire, including particulars of the time, place and mode of agreement;

• the precise purpose or object of the conspiracy;

• the overt acts alleged to have been done by each of the alleged conspirators in furtherance of the conspiracy, including the time, and place and nature of the acts; and

• the injury and damage caused to the plaintiff as a result of the conspiracy.

[64] Conspiracy is an intentional tort and a serious allegation, and as such, the material facts must be pleaded with heightened particularity: Enercare, at para. 25.

[65] If the defendant's conduct is lawful, the predominant purpose of the conduct must have been to cause injury to the plaintiff. If the defendant's conduct is unlawful, it is sufficient that the conduct was directed toward the plaintiff, and the defendant should have known from the circumstances that the conduct would be likely to harm the plaintiff: Enercare, at para. 19.

[66] The plaintiffs have organized their pleading by defendant – much like six individual statements of claim chained together. This is especially problematic in relation to the claim of conspiracy which, by its very nature, is a tort involving multiple defendants. Because the individual contributions to the alleged conspiracy are dotted about the pleading, the elements of the alleged conspiracy are difficult to discern.

Tarion

[67] In paragraph 1(j) of the statement of claim, the plaintiffs claim damages of $50,000,000 against Tarion for civil conspiracy. In subsequent paragraphs they plead:

• that Tarion "induced a civil conspiracy" by providing false and misleading statements to numerous municipalities, purchasers and Durham Regional Police";

• that at a meeting with purchasers on August 15, 2017, Tarion falsified allegations against the plaintiffs "in order to conspire with the purchasers, incite hatred, induce breach of contract and cause several purchasers to breach their contracts with the plaintiffs";

• that Tarion "continues to conspire with the townships and has conspired with Douro-Dummer township in attempting to perfect a spoliation, in order to further diminish the life and businesses of Cory Savary";

• that municipalities "continue to collude and conspire with Tarion and deny permits to Cory Savary and or Kings Custom Homes";

• that a Tarion staff member Ian Bulloch "started an email chain to bring the purchasers together to conspire, collude, defame and slander their builder, with malicious intent, thereby intentionally inciting and wilfully promoting hatred towards Cory Savary and Kings Custom Homes Incorporated";

• that "Tarion communicated untrue and misleading information on the email chain, in the notice of proposal to revoke and to various municipalities, on CTV News, and to purchasers to further a civil conspiracy against Cory Savary and or Kings Custom Homes";

• that "Tarion's conspiring and colluding with numerous municipalities to refuse building permit issuance to Cory Savary and or Kings Custom Homes Incorporated, has caused Cory Savary and Kings Custom Homes to have to pay more than $120,000.00 in additional interest payments, due to construction being delayed or not being able to take place";

• that Tarion's "unnecessary and intentional interference with economic relations and conspiracy with numerous municipalities has increased the legal bills of Cory Savary and Kings custom Homes Incorporated by more than $200,000.00. Again, in a calculated effort to cost Cory Savary and Kings Custom Homes as much money as possible while illegally interfering with the economic relations and general life of Cory Savary and business operations of Kings Custom Homes Incorporated";

• that Tarion's "conspiring and colluding with municipalities to refuse to issue permits has caused more than $40,000.00 in lumber to be damaged by long term weathering and needing to be or having been replaced, at additional costs to Kings"; and

• that Tarion's intentional interference and civil conspiracy "have caused numerous parties to stop dealing with the Oil, Gas, and Nuclear inspection, development, construction, and consulting business of Cory Savary. This interference has placed more than $600,000,000.00 in projects on hold indefinitely."

[68] The parties to the conspiracy and their relationship to each other is not clear. Who are the "purchasers" referred to? Do the "municipalities" referred to include all the defendant municipalities? Is Durham Regional Police Service alleged to be a conspirator? Are all the entities alleged to be part of one large conspiracy or were there individual conspiracies with one or more purchasers, one or more municipalities? What are the particulars of the agreement or agreements among the alleged conspirators? What is the false or misleading information referred to? If purchasers are alleged to have conspired, what did they do in furtherance of the conspiracy and what was their purpose in doing so?

[69] For these reasons, the pleading of conspiracy against Tarion does not satisfy the requirement of "heightened particularity" set out in Enercare and will be struck out. This includes paragraphs 1(j), 7, 17, 23, 25, 40, 43, 44, 45 and 49 of the statement of claim.

Douro-Dummer

[70] In paragraph 77(b) of the statement of claim, the plaintiffs claim $20,000,000 in damages from Douro-Dummer for civil conspiracy. In subsequent paragraphs they plead:

• that "the Township of Douro-Dummer has conspired with Tarion and other municipalities to intentionally interfere with the economic relations of and disrupt the life and business of Cory Savary and Kings Custom Homes Incorporated and continues to do so";

• that "the Township of Douro-Dummer has conspired with Tarion and other municipalities in order to cost Cory Savary and Kings an exorbitant amount of money in an attempt to financially injure Cory Savary and Kings and continues to do so and does so with malicious intent";

• that "the Township of Douro-Dummer and certain staff did conspire with Tarion to stop Kings from advancing their business by falsifying information to intentionally discredit and potentially bankrupt the company …";

• that "Ken Currie has colluded and conspired with Ian Bulloch and Tarion for several years to intentionally interfere with the economic relations of Cory Savary and Kings Custom Homes Incorporated";

• that "the township and new CBO Brian Fawcett still collude and conspire with Tarion and continue to refuse to issue the permit at 463 County Rd. 40, Douro";

• that "former CBO Ken Currie provided redacted documents to falsify a truth, to collude and conspire with Tarion and the Township of Douro Dummer in an attempt to perfect a spoliation, and further damage the rights of Cory Savary and or Kings Custom Homes Incorporated";

• that "Ken Currie conspired with Tarion staff, in an effort to perfect a spoliation against Cory Savary and Kings Custom Homes, to protect Tarion and Douro-Dummer Township from litigious actions against them"; and

• that "the Township of Douro-Dummer, and numerous staff members and a former staff member Ken Currie, continue to collude and conspire with Tarion and are active participants in attempting to commit and perfect Spoliation, by attempting to compel a Superior Court Justice to order the demolition of the home of Cory Savary"; and

• that "Township Mayor Murray Jones failed to act knowing that township staff was actively and collusively conspiring with Tarion in violating the rights of and intentionally interfering with the economic relations of Cory Savary and or Kings Custom Homes Incorporated."

[71] The pleading of conspiracy against Douro-Dummer suffers from many of the same deficiencies as the pleading against Tarion. Who are the "other municipalities with whom Douro-Dummer conspired? Who are the "certain staff" and what information did they falsify? What does it mean to "perfect a spoliation"?

[72] For these reasons, the pleading of conspiracy against Douro-Dummer does not satisfy the requirement of "heightened particularity" set out in Enercare and will be struck out. This includes paragraphs 77(b), 78, 79, 82, 90, 97, 101, 103, 129 and 137 of the statement of claim.

CTV News

[73] In paragraph 140(b) of the statement of claim, the plaintiffs claim $30,000,000 in damages from CTV News for civil conspiracy. In subsequent paragraphs they plead:

• that CTV News reported stories about individuals who were not purchasers from the plaintiffs and "did conspire with Tarion to do so";

• that CTV News "did knowingly conspire with Tarion in a civil conspiracy against Cory Savary and Kings Custom Homes Incorporated";

• that CTV News conspired with Tarion to stop the plaintiffs from advancing their business by falsifying information;

• that CTV News did knowingly conspire with Tarion to injure the life, reputation and businesses of the plaintiffs;

• that CTV News staff member Josh Elliott conspired with Tarion by posting defamatory remarks on Cory Savary's Linkedin account; and

• that CTV News staff member Josh Elliott "aided and abetted Tarion in a civil conspiracy against Cory Savary to deter parties from doing business with the Oil, Gas and Nuclear inspection and consulting business of Cory Savary and to financially damage him and any and all of his companies".

[74] The pleading of conspiracy against CTV News suffers from many of the same deficiencies as the pleadings against Tarion and Douro-Dummer. Who were the individuals who were not purchasers? What information was falsified? What defamatory remarks were posted? How did Josh Elliott "aid and abet Tarion in a civil conspiracy"?

[75] For these reasons, the pleading of conspiracy against CTV News does not satisfy the requirement of "heightened particularity" set out in Enercare and will be struck out. This includes paragraphs 140(b ), 140(j), 143, 145, 147, 151, 152 and 153 of the statement of claim.

[76] Counsel for CTV News argues that the pleading of conspiracy should be struck out without leave to amend because "there is no basis upon which a court could conclude that journalists reporting on a public investigation into the plaintiffs by the province of Ontario's homebuyer protection agency could be considered a conspiracy to injure the plaintiffs." However, while I agree that the allegation is far-fetched, I cannot say that it is "manifestly incapable of proof".

Asphodel-Norwood

[77] In paragraph 155(b) of the statement of claim, the plaintiffs claim $5,000,000 in damages from Asphodel-Norwood for civil conspiracy. In subsequent paragraphs they plead:

• that the township conspired with Tarion in order to intentionally deny permits to the plaintiffs;

• that the township colluded with Tarion in order to deceive purchasers by making false statements about the plaintiffs;

• that the township conspired with Tarion to target, discriminate against and harass the plaintiffs.

[78] Again, this pleading does not satisfy the requirement of "heightened particularity" set out in Enercare and will be struck out. This includes paragraphs 155(b), 156, 157 and 162 of the statement of claim.

Otonabee-South Monaghan

[79] The plaintiffs claim $20,000,000 in damages from Otonabee-South Monaghan for civil conspiracy. However, it is difficult to discern what the plaintiffs say is the basis for the claim.

[80] In paragraph 164 of the statement of claim, the plaintiffs plead that "Otonabee CBO Barb Waldron conspired with Tarion in order to intentionally interfere with the economic relations of [the plaintiffs]."

[81] I have already found that the facts pleaded by the plaintiffs do not support a claim for intentional interference with economic relations. A bare allegation that Otonabee-South Monaghan conspired with Tarion to interfere with the economic relations of the plaintiffs fairs no better.

[82] Paragraphs 163(b), 163(g) and 164 of the statement of claim will be struck out.

Peterborough Public Health

[83] The plaintiffs claim $5,000,000 from Peterborough Public Health for civil conspiracy.

[84] The facts pleaded in furtherance of the claim are the following:

175. Kathleen Shepherd did knowingly collude and conspire with numerous Peterborough County CBO's and Tarion to intentionally interfere with the economic relations of Cory Savary and Kings Custom Homes Incorporated.

176. Kathleen Shepherd did intentionally withhold permits of Cory Savary in an effort to assist the Township of Douro-Dummer and CBO Brian Fawcett in obtaining a Superior Court of Justice ruling for demolition of the home of Cory Savary and did so with malicious intent.

[85] Counsel for Peterborough Public Health argues that the pleading in paragraph 175 of the statement of claim should be struck for the same reasons that I have found the statement of claim fails to disclose a cause of action for intentional interference with economic relations: i.e. there is no allegation of an actionable civil wrong against a third party. I agree. I would note, however, that an allegation of a conspiracy to damage the plaintiffs' business would not suffer from the same deficiency.

[86] Counsel also argues that the pleading fails as a pleading of conspiracy, for the following reasons:

first, that the plaintiffs have failed to adequately plead the relationship between the parties to the conspiracy;

second, that the plaintiffs have failed to plead sufficient particulars of the agreement among the defendants;

third, that the plaintiffs have failed to plead sufficient particulars of the predominant purpose of the conspiracy;

fourth, that the plaintiffs have failed to plead particulars of the overt acts undertaken by each defendant in furtherance of the conspiracy; and

fifth, that the plaintiffs have not pleaded particulars of the damage caused to them as a result of the conspiracy.

[87] With respect to the first point, I agree that it is insufficient in the description of the parties to the conspiracy to refer to "numerous Peterborough County CBOs" and that each party to the conspiracy must be named. However, I do not agree that the allegations in paragraph 176 of the statement of claim fail to sufficiently describe the relationship between Douro-Dummer and Peterborough Public Health. It is not necessary to plead: "The relationship between the parties is …" In this case it is clear from the pleading that the township and the health authority are both entities from which a builder requires construction approvals.

[88] With respect to the second point, I agree with counsel that the plaintiffs have failed to adequately plead particulars of the agreement among the parties. Part of the problem here may be that the pleading sets out the allegations on a party by party basis, with the result that the facts relating to the allegations of conspiracy are scattered throughout the pleading.

[89] With respect to the third point, while counsel acknowledges that the plaintiffs have pleaded that the purpose of the conspiracy was to cause damage to the plaintiffs' business, he argues that "there are no particulars as to the motivations of each defendant, and there is no allegation that the defendants were not primarily motivated by the legitimate promotion of their own interests, that is, the protection and promotion of public health and safety." I disagree. Purpose may be pleaded without pleading motivation, and the question of whether these defendants were simply doing their jobs is one for the defendants to raise by way of defence.

[90] With respect to the fourth point, I agree that paragraph 175 is devoid of any acts alleged to have been done in furtherance of the conspiracy. It may be that there are facts scattered around elsewhere in the pleading that one could conceivably piece together to form a picture of the acts relied upon; however, the defendants should not have to scour a forty-page statement of claim looking for clues. With respect to paragraph 176, it is sufficiently clear that the plaintiffs allege that Kathleen Shepherd withheld permits to which they say they were entitled and did so to assist Brian Fawcett in obtaining a demolition order relating to Cory Savary's home. Mr. Fawcett's acts in furtherance of the conspiracy are set out in paragraph 115 – he communicated with her and asked that she not issue a septic permit, so that he could claim that the permit application was incomplete, hoping that the court would order demolition, or at least order that the plaintiffs pay costs.

[91] With respect to the fifth point, I agree with counsel that the plaintiffs have pleaded insufficient particulars of the damages alleged to have been suffered.

[92] For these reasons, the allegations of civil conspiracy as against Peterborough Public Health will be struck out. These include paragraphs 115, 174(b), 174(e), 175 and 176 of the statement of claim.

Negligence

[93] A defendant will be liable in negligence where it owes a duty of care to the plaintiff, it fails to meet the required standard of care, and as a result, the plaintiff suffers damages.

[94] In the present case, the plaintiffs plead that representatives of Tarion and Douro-Dummer were negligent, and that representatives of Tarion, Douro-Dummer, CTV News and Peterborough Public Health "failed to exercise a duty of care." However, they do not plead particulars of the duty of care said to be owed, the way in which the defendants failed to meet the required standard of care, or the damages alleged to have been suffered as a result of such failure.

Tarion

[95] The allegations of negligence against Tarion employee Danny Conte appear at paragraphs 53–55 of the statement of claim:

53. Tarion representative Danny Conte made allegations to municipalities that Cory Savary and Kings Custom Homes were building illegal homes in other family members names, in order to skirt the warranty process. Further untrue and misleading statements from Tarion.

54. Danny Conte's actions against Cory Savary and Kings Custom Homes were negligent.

55. Danny Conte failed to exercise a duty of care.

[96] The plaintiffs have failed to plead the required particulars for a claim in negligence, and these paragraphs will therefore be struck out.

[97] The allegations of negligence against Tarion employee Ian Bulloch appear at paragraphs 58-61 of the statement of claim:

57. Tarion staff member Ian Bulloch on or about February 15, 2017 vandalized the home of Cory Savary and business of Kings Custom Homes.

58. Tarion staff member Ian Bulloch was negligent in his actions against Cory Savary and Kings Custom Homes Incorporated.

59. Tarion staff member Ian Bulloch has repeatedly made false accusation with respect to Cory Savary, and also made numerous failed attempts at provoking Cory Savary.

60. Tarion staff member Ian Bulloch's actions were discriminating and harassing.

61. Tarion staff member Ian Bulloch failed to exercise a duty of care.

[98] Again, the plaintiffs have failed to plead the required particulars for a claim in negligence, and these paragraphs will therefore be struck out.

[99] The allegations of negligence against Tarion employee Adil Darr appear at paragraphs 62 – 65 of the statement of claim:

62. Tarion staff member Adil Darr on or about February 15, 2017 was notified of Ian Bulloch's actions, and failed to act or respond to Cory Savary and or Kings Custom Homes Incorporated.

63. Tarion staff member Adil Darr was contacted several times about the actions of Ian Bulloch and failed to act or respond.

64. Tarion staff member Adil Darr's actions were negligent.

65. Tarion staff member Adil Darr failed to exercise a duty of care.

[100] While these paragraphs may contain a germ of a pleading in negligence, they fail to explain how the relationship between Adil Darr and Ian Bulloch would create a duty on Darr to respond to complaints about Bulloch, they fail to plead the damages resulting from Darr's failure to act, and they fail to explain what response from Darr would have avoided such damages, after the fact.

[101] The allegations of negligence against Tarion employee Tanya Gibson appear at paragraphs 62 – 65 of the statement of claim:

66. Tarion staff member Tanya Gibson on or about November 20th, 2018 did provide false, slanderous and defamatory statements to the public, and those false statements were also published on the Landing page of the Tarion website, further diminishing the life and businesses of Cory Savary and any and all of his companies including Kings Custom Homes Incorporated, as well as further deceiving the general public. More untrue and misleading statements by Tarion and Tarion staff.

67. Tarion staff member Tanya Gibson's comments were discriminating and harassing.

68. Tarion staff member Tanya Gibson did allege Cory Savary is an illegal builder, again untrue and misleading.

69. Tarion and Tarion staff member Tanya Gibson made these statements with malicious intent, to intimidate and deceive other builders and the public.

70. Tarion staff member Tanya Gibson's failed to exercise a duty of care.

[102] The plaintiffs have failed to plead the required particulars for a claim in negligence, and these paragraphs will therefore be struck out.

Douro-Dummer

[103] With respect to negligence, the claim against Douro-Dummer appears to be that Ken Currie and Brian Fawcett were successive chief building officials, and that they failed to issue building permits to which the plaintiffs were entitled pursuant to the provisions of the Building Code Act.

[104] In carrying out the duties imposed upon a chief building official, he or she must act reasonably in all the circumstances. If the chief building official delays unreasonably in issuing permits to which an applicant is entitled, the municipality may be held liable for any resulting damages: Carson v. Kearney (Town), 2016 ONSC 2836, affirmed 2016 ONCA 975.

[105] The facts pleaded by the plaintiffs suggest conduct on the part of Ken Currie and Brian Fawcett that could be found to be unreasonable. However, in order to disclose a cause of action, the plaintiffs would, at minimum, have to plead the dates of the permit applications, the properties involved, the dates when the permits were denied, that they were entitled to the permits, that Douro-Dummer acted unreasonably in refusing to issue them, and that damages were suffered as a result (including particulars of those damages).

[106] For these reasons, the allegations of negligence and failure to meet a standard of care as against Douro-Dummer will be struck out. These include paragraphs 92, 96, 118, 126, 128, 134, 136 and 139 of the statement of claim

CTV News

[107] In paragraphs 141-153 of the statement of claim, the plaintiffs make numerous allegations against CTV News which are dealt with elsewhere in these reasons. And then at paragraph 154, they conclude with an allegation that "Bell Media, CTV News, Heather Wright, and Josh Elliot failed to exercise a duty of care when dealing with Cory Savary and or Kings Custom Homes Incorporated."

[108] The plaintiffs have failed to plead the required particulars for a claim in negligence and paragraph 154 will therefore be struck out.

Peterborough Public Health

[109] The allegations against Peterborough Public Health appear at paragraphs 175-178 of the statement of claim:

175. Kathleen Shepherd did knowingly collude and conspire with numerous Peterborough County CBO's and Tarion to intentionally interfere with the economic relations of Cory Savary and Kings Custom Homes Incorporated.

176. Kathleen Shepherd did intentionally withhold permits of Cory Savary in an effort to assist the Township of Douro-Dummer and CBO Brian Fawcett in obtaining a Superior Court of Justice ruling for demolition of the home of Cory Savary and did so with malicious intent.

177. Kathleen Shepherd's actions were discriminatory and harassing.

178. Kathleen Shepherd failed to exercise a duty of care.

[110] Peterborough Public Health argues that its duties under the Health Protection and Promotion Act are to be exercised in the general public interest and that they are not aimed at or geared to the protection of the private interests of specific individuals: Eliopoulos v. Ontario (Minister of Health & Long Term Care) (2006), 2006 CanLII 37121 (ON CA), 82 O.R. (3d) 321 (C.A.), at para.17. As a result, they say, "Ms. Shepherd did not owe the plaintiffs a duty when she exercised her discretionary powers in the public interest. She was not obliged to protect the private interests of specific individuals like the plaintiffs." I disagree with that analysis.

[111] In Eliopoulos, the plaintiffs were family members of a person who died as a result of contracting West Nile Virus. Their claim was that Ontario owed the deceased a private law duty to take reasonable steps to prevent the spread of the West Nile and failed at the operational level to implement a plan it had developed for the expected outbreak of the virus. In striking out the claim, the court held that there was a general public law duty requiring the Minister to endeavour to promote, safeguard, and protect the health of Ontario residents and prevent the spread of infectious diseases, but not a private law duty owed to specific individuals.

[112] In my view, the duties of the Minister referred to in Eliopoulos may be distinguished from the duties of a local health inspector. The plaintiffs in this case required a septic permit. In deciding whether to issue a permit, it is at least arguable that Ms. Shepherd was required to act reasonably. Contrary to Peterborough Public Health's argument, imposing a duty to act reasonably would not be in conflict with the inspector's duty to act in the public interest. If the plaintiffs met the requirements for issuance of a permit, and issuance of the permit would not be contrary to the public interest, what would the public interest basis be for refusal of the permit?

[113] The facts pleaded by the plaintiffs suggest conduct on the part of Ms. Shepherd that could be found to be unreasonable. However, in order to disclose a cause of action, the plaintiffs would, at minimum, have to plead the date of the permit application, the property involved, the date when the permit was denied, that they were entitled to the permit, that Peterborough Public Health acted unreasonably in refusing to issue it, and that damages were suffered as a result (including particulars of those damages).

[114] For these reasons, paragraph 178 of the statement of claim will be struck out.

Discrimination and harassment

[115] The plaintiffs allege that the conduct of Tarion, Douro-Dummer, Asphodel-Norwood, Otonabee-South Monaghan and Peterborough Public Health was discriminatory and harassing.

[116] In King v. Ryerson University, 2015 ONCA 648, at para. 5, the court said the following in relation to a claim of discrimination:

To the extent that the appellant pleads discriminatory conduct by Ryerson or its employees, and seeks damages in respect of such conduct, the Supreme Court has confirmed that there is no cause of action in tort at common law for discrimination, nor an "independently actionable wrong" in respect of discriminatory conduct for the purpose of awarding punitive damages: see Bhadauria v. Seneca College of Applied Arts & Technology, 1981 CanLII 29 (SCC), [1981] 2 S.C.R. 181 (S.C.C.), at pp. 183 and 195; Keays v. Honda Canada Inc., 2008 SCC 39 (S.C.C.), at para. 63. As a result, where, as here, a person alleges conduct that offends the Ontario Human Rights Code, a remedy must be sought within the statutory scheme of the Code itself.

[117] Section 46.1 of the Human Rights Code provides a civil remedy where in a civil proceeding, the court finds that a party to the proceeding has infringed a right of another party, under Part I of the Act.

[118] The prohibited grounds of discrimination under Part I of the Act are race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, gender identity, gender expression, age, marital status, family status or disability. As none of the conduct of any of the defendants involves allegations of discrimination on any of those grounds, all references to discrimination will be struck out, without leave to amend.

[119] In Merrifield v. Canada (Attorney General), 2019 ONCA 205, the court held that there is no cause of action in tort at common law for harassment, but went on to say: "In summary, while we do not foreclose the development of a properly conceived tort of harassment that might apply in appropriate contexts, we conclude that Merrifield has presented no compelling reason to recognize a new tort of harassment in this case."

[120] In Stancer Gossin Rose LLP v. Atas, 2021 ONSC 670, at paras. 163 – 175, Corbett J. held that a new tort of "internet harassment" should be recognized in Ontario and found that the defendant's conduct met the following test drawn from American case law:

[W]here the defendant maliciously or recklessly engages in communications conduct so outrageous in character, duration, and extreme in degree, so as to go beyond all possible bounds of decency and tolerance, with the intent to cause fear, anxiety, emotional upset or to impugn the dignity of the plaintiff, and the plaintiff suffers such harm.

[121] None of the allegations of harassment involve use of the internet by the defendants; nor is any of the alleged conduct of the sort referred to in Atas. The allegations of harassment will therefore be struck out, without leave to amend.

[122] The references to discrimination and harassment to be struck out include the references in paragraphs 1(a), 1(n), 6, 51, 60, 67 and 74 (relating to Tarion), paragraphs 94, 126 and 133 (relating to Douro-Dummer), paragraph 162 (relating to Asphodel-Norwood), paragraph 171 (relating to Otonabee-South Monaghan, and paragraph 177 (relating to Peterborough Public Health).

Punitive, exemplary and aggravated damages

[123] The plaintiffs claim "punitive, aggravated and exemplary" damages in amounts ranging from $5,000,000 to $20,000,000.

[124] "Punitive" and "exemplary" are two different names for the same head of damage – there is no reason to claim both. "Punitive" would appear to be the more modern term.

[125] Punitive damages are non-compensatory; aggravated damages are compensatory. They should therefore be pleaded separately.

[126] "Punitive damages are awarded against a defendant in exceptional cases for "malicious, oppressive and high-handed" misconduct that offends the court's sense of decency": Whiten v. Pilot Insurance Co., 2002 SCC 18, at para. 36.

[127] Citing Whiten, at para. 87, the defendants argue that the facts said to justify punitive damages are not pleaded with sufficient particularity. However, what the court in Whiten was saying was that allegations that the defendant's conduct was harsh, vindictive, reprehensible or malicious are conclusory rather than explanatory. In the present case, the plaintiffs allege conduct which, if proved, could arguably be the subject of an award of punitive damages.

[128] Again citing Whiten, at para. 78, the defendants argue that the claims for punitive damages should be struck because the plaintiffs have failed to plead an "independent actionable wrong." However, the requirement that there be an independent actionable wrong applies to cases in contract, but not tort.

[129] Aggravated damages may be awarded where the plaintiff establishes that the defendant's conduct caused the plaintiff to suffer mental distress. A corporation cannot suffer mental distress and cannot therefore recover aggravated damages:

[130] In the present case, the plaintiffs have failed to plead, in a concise fashion, what they say the aggravating factors are. The claims for aggravated damages will therefore be struck out.

Damages Generally

[131] The plaintiffs have claimed hundreds of millions of dollars in damages, without providing particulars of the damages they allege to have been suffered. In any amended pleading which they seek to file, they must comply with rule 25.06 and plead the amounts and particulars of special damages to the extent they are known, as of the date of pleading.

Additional issues

CTV News - merger

[132] In October 2017, CTV News broadcast a story about the plaintiffs on its television network. The broadcast was also posted on the CTV News website. At the same time, CTV News published an article on the website reporting the same information.

[133] In their claims for relief against CTV, the plaintiffs claim a total of $300,000,000 in damages for intentional interference with economic relations, civil conspiracy, injurious falsehood, violations of the Competition Act, and violations of the Security of Information Act. They request orders that CTV remove derogatory posts about the plaintiffs from their website and post an apology, as well as a declaration that CTV conspired and participated with Tarion in a terrorist act against them.

[134] CTV's position is that the action should be dismissed as against it. Counsel argues that the plaintiffs' claim, in essence, is a claim for libel, and that as such, it is barred by ss. 5(1) and 6 of the Libel and Slander Act, as a result of the plaintiffs' failure to give written notice of their claim within six weeks of the broadcast coming to their attention, and their failure to commence their action within three months of same. I disagree, for the following reasons.

[135] CTV relies upon the "doctrine of merger." They argue that where the plaintiffs' claims rest upon impugned publications, and that where the damages claimed arise solely as a result of those publications, the plaintiffs' avenue of redress is a defamation claim. They say that the law of defamation represents decades of jurisprudence that has established various principles and defences to assist the courts in balancing the protection of reputation on the one hand, and the right to freedom of expression on the other. They argue that the court should not allow the plaintiffs to avoid the defences to which CTV would be entitled in a defamation action, by allowing their claim to proceed under some other guise. They say that the doctrine of merger is of particular importance to news media defendants.

[136] I do not accept that the doctrine of merger is applicable in this case or that it should be considered at this stage of the action.

[137] The doctrine of merger applies to claims of civil conspiracy. The underlying basis of the doctrine is explained in Jevco Insurance Co. v. Pacific Assessment Centre Inc., 2015 ONSC 7751 (Div. Ct.), at para. 20:

The doctrine of merger applies in a situation where there is a conspiracy to commit a tort, and the tort is actually committed. The theory behind merger is that once the planned tort is actually committed, the harm flows from the tort, and the pleading of conspiracy is therefore redundant.

[138] In the present case, CTV argues that various nominate torts merge with the defamation claim which they say is, in essence, the claim made by the plaintiffs. However, they have provided no authority for the proposition that the doctrine applies in circumstances other than to merge a conspiracy claim with a claim based upon a nominate tort. Here, the plaintiffs do not allege that CTV conspired with one or more other defendants to commit libel.

[139] In addition, the doctrine of merger should not be applied at the pleadings stage of an action. Following a review of the case law on the issue, the court in Jevco came to the following conclusion (at paras. 52f):

Accordingly, in my view, the law supports permitting the conspiracy claim to be pleaded along with other nominate torts, and applying the doctrine of merger only at the end of the trial when it is known if the plaintiff has been fully successful on the nominate torts, and whether there is anything added by the conspiracy claim. Further, in the interests of paring down out-of-control interlocutory proceedings and introducing consistency in the law, as a practical matter it is preferable not to resolve these types of claims at the pleadings stage.

As the motion judge put it, at para. 80 of his reasons, "it is time to eulogize the passing of the merger principle as a basis to challenge a pleading".

[140] With respect to the nature and availability of the doctrine of merger, Jevco was cited with approval by the Court of Appeal in Harlson v. Lewis, 2018 ONCA 1048, at paras. 13 and 21. See also Hudspeth v. Whatcott, 2017 ONSC 1708, at para. 232.

[141] I also do not accept CTV's position that the plaintiffs' claims amount to a claim for libel.

[142] In support of its position, CTV relies upon Avalon Rare Metals Inc. v. Hykawy, 2011 ONSC 5569; Elliott v. Canadian Broadcasting Corp. (1993), 1994 CanLII 10569 (ON SC), 16 O.R. (3d) 67, [1993] O.J. No. 3204 (Gen. Div.), aff'd 1995 CanLII 244 (ON CA), [1995] O.J. No. 1710 (C.A.), leave to appeal to SCC refused, [1995] S.C.C.A. No. 393; and Ward v. Bosveld, [1983] O.J. No. 1281, 40 C.P.C. 24.

[143] In Avalon, the court said the following, at paras. 15f:

It is common ground that there is no absolute bar to a plaintiff claiming damages for defamation and concurrently or in the alternative for other torts. At the same time, it is also undisputed that a claim for defamation cannot be "dressed up" as another claim to evade the defences available in a defamation action.

In consequence, the questions to be determined on this motion are whether all of the pleaded causes of action are independent or whether they are subsumed under the law of defamation. In other words, do all of the pleaded claims rest on the impugned publications and do all of the damages claimed arise only as a result of those publications?

[144] I agree that a claim for defamation cannot be "dressed up" as another claim to evade the defences available in a defamation action. I also agree that the question to be determined is whether a pleaded cause of action is independent or subsumed under the law of defamation. However, I do not agree that the test can be stated to be whether all the pleaded claims rest on the impugned publications and all the damages claimed arise only as a result of those publications.

[145] A defamatory publication is one which tends to lower a person's reputation in the eyes of right-thinking members of society, or to expose a person to hatred, contempt or ridicule: Botiuk v. Toronto Free Press Publications Ltd., 1995 CanLII 60 (SCC), [1995] 3 S.C.R. 3, at para. 62. However, a false statement may also interfere with a plaintiff's economic interests or induce a breach of contract. "Where this occurs, the plaintiff may have a cause of action against the defendant in defamation, but also causes of action for interference with economic interests and inducing breach of contract": Randy A. Pepper and others, Canadian Defamation Law and Practice, ebook, (Toronto: Carswell, 03 Jan 2021), at 13:30. Similarly, where a defendant's false statement disparages the plaintiff's business or property and injures the plaintiff's reputation, the plaintiff can rely upon both injurious falsehood and defamation: Pepper at 13:20. In Raymond E. Brown, Brown on Defamation, ebook, 2nd ed. (Toronto: Carswell, 04 Jan 2021), at 28.1(1), the author comments: "[The tort of injurious falsehood] 'is in no way derived or descended from, or related to, the defamation actions for libel and slander.' The actions are distinct; they protect different interests." [Citations omitted.]

[146] In the present case, the plaintiffs do not plead defamation, and in argument, said that they are claiming only for damage to their business interests, and not for damage to their reputation. Accordingly, even though all the claims made against CTV are based upon the impugned publications, and all the damages arise only as a result of those publications, the pleaded causes of action are independent and not subsumed under the law of defamation.

[147] See also Subway Franchise Systems of Canada, Inc. v. Canadian Broadcasting Corporation, at paras. 52-68 where the plaintiff based its claims in both defamation and negligence. The court held that where the damages claimed go beyond mere reputational damages, the plaintiff's negligence claim should not be dismissed as a "dressed-up" defamation claim.

Peterborough Public Health – Vicarious liability

[148] Counsel argues that the claim should be dismissed as against Peterborough Public Health because no direct claim is made against it. He argues that if vicarious liability is relied upon, the plaintiffs must allege vicarious liability, and plead the nature of the legal relationship giving rise to the claim.

[149] Given that the employer/employee relationship is the most common basis for vicarious liability, it will have come as no surprise to Peterborough Public Health that the plaintiffs claim that it is vicariously liable for the actions of Kathleen Shepherd. However, I agree that no direct claim is made against Peterborough Public Health and that if the claim against it is based upon vicarious liability, the plaintiffs must plead the nature of the relationship which it alleges gives rise to the liability. The claim against Peterborough Public Health will therefore be struck out, but with leave to amend.

Peterborough Public Health – Statutory immunity

[150] With respect to Kathleen Shepherd, counsel for Peterborough Public Health relies upon the immunity provided for in s. 95(1) of the Health Protection and Promotion Act. He argues that the claims against her should be struck out because the plaintiffs fail to allege that she acted beyond the limits of her statutory authority, or that she executed her duties in bad faith. I disagree.

[151] In support of his position, counsel for Peterborough Public Health relies on Sparks v. Ontario, 2010 ONSC 4234, at paras. 18 and 24. In Sparks, the plaintiff sued the superintendent and others for injuries sustained as a result of an assault by another inmate at Toronto East Detention Centre. The defendants moved under rule 21.01(1)(b) for an order striking out the statement of claim relying upon the statutory immunity provided for under s. 12(1) of the Ministry of Correctional Services Act. Under that act, similar to the Health Protection and Promotion Act, to obtain the benefit of the immunity, the defendant must have been acting in good faith. At para. 14 of the decision, the court says: "The determination of whether the amended statement of claim discloses a reasonable cause of action revolves around whether sufficient facts are pleaded to establish bad faith." However, in Sparks, the plaintiff had pleaded bad faith and the issue was whether it had been sufficiently pleaded (the court found that it had been). The question of whether a claim should be struck out under a statutory immunity clause for failure to plead bad faith does not appear to have been in issue.

[152] Section 95(1) of the Health Protection and Promotion Act does not introduce an additional element to a cause of action against a public health inspector. Rather, it provides an affirmative defence which must be pleaded under rule 25.07(4).

[153] In Abrahamovitz v. Berens, [2018] ONCA 252, the court said the following, at paras. 30-33:

This court explained in Beardsley v. Ontario (2001), 2001 CanLII 8621 (ON CA), 57 O.R. (3d) 1(C.A.), at para. 21 that "the expiry of a limitation period does not render a cause of action a nullity; rather, it is a defence and must be pleaded".

The requirement that an affirmative defence, including a limitations defense, be pleaded to avoid surprise to the opposite party is reflected in r. 25.07(4) of the Rules of Civil Procedure, which provides:

In a defence, a party will plead any matter on which the party intends to rely to defeat the claim of the opposite party and which, if not specifically pleaded, might take the opposite party by surprise or raise an issue that has not been raised in the opposite party's pleading.

The second aspect of the statement from Beardsley, however, is more germane to this case. A limitations defence is "just that, a defence" … . A defendant chooses whether or not to rely on a limitations defence, but is not obliged to do so … . [Citations omitted].

[154] In my view, the same considerations apply to a defence of statutory immunity. It is an affirmative defence and must be pleaded, if it is to be relied upon. It may or may not afford a complete defence. "Rule 25.06 does not require plaintiffs to plead their claims anticipating defences which might be raised. Replies function to respond to pleaded defences: rule 25.08(2)": Greatrek Trust A.A./Inc. v. Aurelian Resources Inc., 2009 CanLII 6095 (Ont. S.C.J.), at para. 18.

[155] Further, the issue of good faith in the context of statutory immunity defences will, in most cases, depend upon findings of fact for resolution. As a result, a motion for summary judgment is likely to be a more appropriate procedure: see Aurelian Resources Inc., para. 19 (relating to the desirability of using evidence-based motions to deal with the applicability of limitation defences).

[156] Finally, it is hardly plain and obvious that a public health inspector who withholds a permit, for the purpose of assisting a township to unlawfully obtain a demolition order, is acting in good faith.

Leave to amend

[157] The position of the defendants is that the entirety of the statement of claim should be struck out without leave to amend.

[158] A statement of claim should be struck out, without leave to amend, only in the very clearest of cases: Conway v. Law Society of Upper Canada, 2016 ONCA 72, at para. 16. In the present case, I am not persuaded that the deficiencies in the pleading of certain causes of action cannot be rectified.

[159] The essence of the plaintiffs' claims is that Tarion wanted the plaintiffs out of the homebuilding business, that Tarion made false statements in order to effect that result, and that the other defendants engaged in a course of conduct, in association with Tarion, for the purpose of causing damage to the plaintiffs' business.

[160] The statement of claim, as filed, was unwieldy and failed to coherently set out the case the defendants were required to meet. Far from being a concise statement of the material facts upon which the plaintiffs rely, as required by rule 25.06(1), it was repetitive in the extreme, at times disorganized, and too long: 178 paragraphs and 40 pages in length. In addition, it contained allegations apparently inserted for colour, or to impugn the behaviour or character of the defendants, unrelated to the issues in the litigation. Rather than concentrating on properly pleading the causes of action with potential to succeed, the plaintiffs filled out the 40 pages with claims for which there was no hope of success.

[161] As a result of my rulings earlier in these reasons, the statement of claim has been decimated to the point where it would make no sense to require the plaintiffs to use it as a starting point for the drafting of an amended pleading. As a result, the most appropriate disposition of the motion is to strike the pleading in its entirety, and grant leave to the plaintiffs to move for an order permitting them to deliver a fresh statement of claim, in accordance with these reasons, based upon a draft to be contained in the motion record.

[162] The causes of action to be included in the fresh statement of claim will be restricted to the following:

• as against Tarion: injurious falsehood; inducing breach of contract; conspiracy to cause damage to the plaintiffs' business;

• as against Douro-Dummer: negligence; injurious falsehood; conspiracy to cause damage to the plaintiffs' business;

• as against CTV News: injurious falsehood; inducing breach of contract; conspiracy to cause damage to the plaintiffs' business;

• as against Asphodel-Norwood: negligence; injurious falsehood; conspiracy to cause damage to the plaintiffs' business;

• as against Otonabee-South-Monaghan: negligence; injurious falsehood; conspiracy to cause damage to the plaintiffs' business; and

• as against Peterborough Public Health: negligence; conspiracy to cause damage to the plaintiffs' business;

[163] The plaintiffs may also claim punitive and aggravated damages, again in accordance with these reasons.

[164] I should make it clear that I am not saying that the plaintiffs will be able to plead the facts necessary to support these causes of action. Rather, I say only that based upon the facts pleaded, and the submissions made by Mr. Savary at the hearing, it appears possible that they will be able to do so. This will require them to understand the facts, and the law as to what is required to support each cause of action, and to then plead those facts clearly and concisely.

[165] If the parties are unable to agree on costs, I will consider brief written argument, provided that it is delivered to my assistant, at monica.mayer@ontario.ca, no later than April 24, 2021.

"S.T. Bale J."

Released: March 31, 2021