COURT FILE NO.: CV-17-00002896-00

DATE: 2021 05 19

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

GHAZALA PERVEEN BEG and MIRZA IZHAR BEG

Muhammad Zafar, Counsel for the Plaintiffs

Plaintiffs

• and -

PRECIOUS BY MAIRA, SABZ HAUTE COUTURE, MAIRA MAHMOOD, KHURRUM MASEER, SABEEN ALI and ALI WAZIR

Harpreet K. Sidhu, Counsel for the Defendants

Respondents

HEARD: April 14, 2021

REASONS ON SUMMARY JUDGEMENT MOTION and MOTION FOR DEFAULT JUDGEMENT

DENNISON J.

Introduction

1The Plaintiff Ghazala Perveen Beg, worked for Precious by Maira and Sabz Haute Couture. The two businesses operated out of the same location. Ghazala Perveen Beg opened and closed the store and did clothing alterations. Maira Mahmood owns Precious by Maira. Her husband is Khurrum Naseer. Sabeen Ali owns Sabz Haute Couture. Sabeen Ali is married to Ali Wazir. They are all named as Defendants.

2Sabeen Ali, Maira Mahmood and Ghazala Perveen Beg were all members of a saving circle, in which each member contributes money monthly and one member obtains all of the money that is collected in a certain month. The Plaintiffs claim that the Defendants falsely claimed that Ghazala Perveen Beg stole money from the businesses so they could steal the $7,000.00 that was owed to Ghazala Perveen Beg through the saving circle. The Plaintiffs submit that the fact that the charges were withdrawn demonstrates that the charges were false. The Plaintiffs also claim that the Defendants defamed Ghazala Perveen Beg in the Pakistani community through Facebook, text messages and speaking to members of the community.

3The Plaintiffs, Ghazala Perveen Beg and her husband, Mirza Izhar Beg, seek damages for malicious prosecution, defamation, fraud/theft of the saving circle money and other monies owed to Ghazala Perveen Beg when her employment was terminated.

4The Defendants seek Summary Judgement to have the claim dismissed. They submit that there is no evidence of malicious prosecution or defamation. Maira Mahmood and Sabeen Ali provided the police with the surveillance video of the store and the police charged Ghazala Beg with theft over $5,000.00. The Defendants also claim that there is no evidence of defamation. There is no evidence of what exactly was said and to whom.

5The Defendants also seek a Default Judgement on their Counterclaim. The Defendants sought damages for the money and other items that they claim Ghazala Perveen Beg stole from the businesses.

6In response, the Plaintiffs brought a Cross Motion seeking Summary Judgement in their favour. The Plaintiffs also seek to have the Counterclaim dismissed because it was not properly filed. In the alternative, the Plaintiffs seek to have the Noting of Default set aside.

7The issues to be determined in these Motions are as follows:

1. Is there a triable issue of malicious prosecution that can be resolved by Summary Judgement?

2. Is there a triable issue of defamation made out against each of the Defendants that can be resolved by Summary Judgement?

3. Is there a triable issue for the claim of fraud/theft of the saving circle money and other monies owing to Ghazala Perveen Beg that can be resolved by Summary Judgement?

4. If the Plaintiffs have proven any of the claims, what damages have the Plaintiffs’ proven?

5. Was the Counterclaim properly filed?

6. Should Default Judgement be granted on the Counterclaim?

7. How should any outstanding matters proceed?

Summary of the Facts

Allegations of Theft

8Ghazala Perveen Beg worked for Maira Mahmood and Sabeen Ali at Precious by Maira (“Precious”) and Sabz Haute Couture (“Sabz Couture”). The businesses operated out of the same location. Ghazala Perveen Beg opened and closed the businesses and completed clothing alterations for clients.

9Sabeen Ali alleges that on May 9, 2017, she left her purse in the business and it contained $6,700.00. When she returned, she noticed the cash was missing. She reviewed the surveillance video and saw that Ghazala Perveen Beg had gone into her purse. She also advised that on March 13, 2017, the surveillance video showed Ghazala Perveen Beg attempting to take cash from the register.

10On June 29, 2017, the Defendants reported this matter to the Peel Regional Police. Sabeen Ali is the named complainant, as were the businesses Precious and Sabz Couture. The value of the property alleged to have been stolen was $6,700.00. Ghazala Perveen Beg was charged on July 13, 2017, with theft over $5,000.00. The charge was ultimately withdrawn by the Crown on October 24, 2017.

The Plaintiffs’ Claim that the Defendants had a Motive to Lie

11Ghazala Perveen Beg is a member of a saving circle committee. Members of the saving circle contribute money monthly and each month a certain member is given the amount collected that month, according to a set list. Ghazala Perveen Beg was to receive the saving circle money for June. The Plaintiffs claim that Ghazala Perveen Beg was to receive between $7,000.00-$10,000.00. Ghazala Perveen Beg filed the $1,000.00 cheques that she provided to the various members each month to demonstrate that she was a member of the saving circle. She also filed a text message that showed she was to receive the money from the saving circle in June.

12Ghazala Perveen Beg stated that Sabeen Ali told her to return the cheques because they needed to be corrected. The Defendants never returned the cheques to Ghazala Perveen Beg. The Defendants told her that she should give up the saving circle money or they would lay false criminal charges against her. Ghazala Perveen Beg submits that the Defendants followed through with their threat and had her falsely charged.

The Alleged Defamatory Statements

13The Plaintiffs claim that the Defendants disparaged Ghazala Perveen Beg and ruined her reputation in the Pakistani community. She became depressed and could not obtain employment for over two years because of the false statements made against her. Ghazala Perveen Beg claims that Maira Mahmood showed the video to all of the boutiques in Mississauga and said, “do not give her any job she has done that.” Ghazala Perveen Beg provided a list of people that she says were shown the false video and were told disparaging comments about her. No Affidavits from any of these individuals were filed on the Motion.

14The Plaintiffs also claim that the Defendants ruined their son’s marriage. Ghazala Perveen Beg claims Sabeen Ali told everybody that Ghazala Perveen Beg had stolen something. Sabeen Ali and her husband went to a person named Junaid Khan and as a result Junaid Khan did not attend the wedding.

15In support of their position that the Defendants defamed Ghazala Perveen Beg, the Plaintiffs filed a Facebook post that was sent from Maira Khurrum (Mahmood) that stated, “need some legal advise [sic] related to a theft at the store... any lawyers out there?”

16The Plaintiffs also rely on text messages dated May 29, 2017 from Ali Wazir to Mirza Izhar Beg that stated “AOA Izhar Bhai, what’s the status…have you guys decided how to proceed? We really need an answer ASAP.”

17There was also a WhatsApp message from Maira Mahmood sent to Mirza Izhar Beg and Ghazala Perveen Beg to meet at a Tim Horton’s to discuss the matter.

18WhatsApp messages from May 18, 2017 between Sabeen Ali and Ghazala Perveen Beg discussed alterations. The message also stated that “the cheque and julery [sic] are in the bag.” There was a request that the Defendant, Sabeen Ali, pick up the bag from 1104 Windbrook Grove, Ghazala Perveen Beg’s home.

19On June 6, 2017, Sabeen Ali sent a group message to the saving circle that “this month’s committee cheque is not going out rite [sic] now, as our member is away for a while and she will deposit her chqs [sic] when she is back.” Another member asked, on June 16, 2017, when the June cheques were coming out.

20On June 28, 2017, Ghazala Perveen Beg responded to the group message as follows:

I have not yet received my committee checks for June and we are now at June 28th. I have not been away this month. Please give my checks to me, I will continue to participate in this committee and the July recipient may cash her check on July 4, 2017 as agreed upon. Thank you

21Sabeen Ali sent the following texts to the group,

Hi Ghazala Beg,

If you recall, we mutually agreed upon that until our store dispute is not [sic] settled down these committee cheques will remain on hold and you are the one who handed over back these cheques to me. These cheques are still in my custody and UNCASHED!!!

I personally not wanted to bring our store dispute in this group, but your message forced me to do and clarify the position.

Also, I have personally informed each committee members individually that June committee is on hold until further noticed [sic] and have also requested not to encash [sic] your cheque. I hope this clarifies.

To all Committee Members

If any of committee member(s) has any question or concern I am more than happy to schedule a meet-up and discuss as this matter is already reported to police. Please advise or call me. Regards, Sabeen Ali.

22Sukaini Bhojani, another member of the saving circle, sent a reply message saying “Salam sabeen. Thx for the update. You have already updated me about the issue with this committee member. I appreciate ur prompt communication.”

23Ghazala Perveen Beg also filed a transcript of a voice recording from July 9, 2017. In that transcript, Ghazala Perveen Beg stated that she took $50.00, but she denied taking a large amount of money from Sabeen Ali.

Procedural History

i) Statement of Claim

24On July 5, 2017, the Plaintiffs filed a Statement of Claim against the Defendants. At the time, the Plaintiffs were not represented by counsel.

25The Statement of Claim pleads that the Defendants acted co-operatively and made false, injurious, and defamatory statements against the Plaintiffs and acted with malicious intent to cause injury to the Plaintiffs.

26The Plaintiffs claim that the Defendants launched a campaign of disparaging Ghazala Perveen Beg in the Pakistani Community and within their mutual saving circle.

27The Plaintiffs claim that the Defendants made false and malicious statements included the following:

a) Ghazala Perveen Beg is a thief;

b) Ghazala Perveen Beg stole from the Defendants;

c) Ghazala Perveen Beg is an unscrupulous business professional; and

d) Ghazala Perveen Beg was out of the country at the time $10,000.00 was due to her from the saving circle and that she should not be paid what was owed to her as part of the mutual saving circle.

28Ghazala Perveen Beg claims general, aggravated, and special damages in the amount of $100,000.00. She also claims punitive and exemplary damages in the amount of $100,000. Ghazala Perveen Beg claims that the Defendants owe her the saving circle money and outstanding wages totalling $1,006.67 and that the Defendants illegally withheld clothes and other items totalling $1,800.00.

29Mirza Izhar Beg, Ghazala Perveen Beg’s husband, claims general, aggravated, and special damages in the amount of $25,000.00 and punitive and exemplary damages in the amount of $25,000.00.

ii) Statement of Defence

30On July 31, 2017, the Defence filed a Statement of Defence.

31The Defendants filed a second Statement of Defence and Crossclaim on August 1, 2017. The second page was titled Counterclaim. The Counterclaim claims that Ghazala Perveen Beg stole money, cash, jewellery, clothing, and store property from the businesses. The total amount sought was $35,000.00. The stolen property included approximately $6,500.00 in cash; $11,300.00 in clothing; $1,500.00 in repaired jewellery; $9,500.00 in stolen jewellery; and $6,800.00 in stolen property.

32The Plaintiffs did not serve and file a Statement of Defence to the Defendant’s Counterclaim.

33On February 25, 2021, the Plaintiffs were noted in default.

iii) Examination for Discoveries

34The examination for discovery of the Plaintiffs was scheduled for March 7, 2019. The discoveries were terminated because both Ghazala Perveen Beg and Mirza Izhar Beg were present and counsel for the Defendants wanted to examine the Plaintiffs separately. Ultimately, the examination for discovery of the Plaintiffs and Defendants took place in late August 2019.

iv) Defendants’ Motion for Summary Judgement and the Plaintiffs’ Cross Motion for Summary Judgement

35In December 2019, the Defendants’ Motion for Summary Judgement dismissing the Plaintiffs’ claim was scheduled to be heard in March 2020. As a result of COVID-19 and the closing of the courts, the Summary Judgement Motion did not proceed. A new date was scheduled for April 14, 2021. The Defendants material for the Summary Judgement was filed two weeks prior to the Motion. The Plaintiffs tried to file responding material, including a Cross Motion seeking Summary Judgement, but their filing was rejected. By the time counsel discovered that the material was rejected, the Court would not accept the late filing of the material because it was too close to the hearing date. I ultimately determined that I would hear the Summary Judgement and Cross Motion, despite not having had an opportunity to review the file in advance, given how long this matter had been outstanding.

Position of the Parties

The Defendants’ Position

36The Defendants submit that the claims against them should be dismissed by way of Summary Judgement. There is no triable issue of malicious prosecution. The Defendants did what any normal employer would do upon viewing a surveillance video, which showed an employee stealing. They took the video to the police and the police decided whether to charge Ghazala Perveen Beg. The Defendants submit that there is no basis to find malicious prosecution.

37The Defendants further submit that the Plaintiffs’ defamation claim should be summarily dismissed for two reasons. First, the Plaintiffs did not comply with the notice requirement in the Libel and Slander Act, R.S.O. 1990, c. L.12. Second, the Plaintiffs have not provided any evidence that the Defendants defamed Ghazala Perveen Beg. The Plaintiffs cannot point to any statements that are defamatory. There is no evidence from any of the persons to whom the alleged defamatory comments were made. It is just Ghazala Perveen Beg and her husband’s vague assertions. The statements made on Facebook and text messages are ambiguous and not defamatory.

38The Defendants submit that the saving circle money is a separate issue that is not part of the Statement of Claim. It was not raised at discovery and there was no defamation that occurred arising out of the saving circle.

39It is the position of the Defendants that even if there was a basis for the Plaintiffs’ claims, the Plaintiffs have failed to prove any of the damages claimed and the action should be dismissed on this basis as well.

40The Defendants also submit that Khurrum Naseer and Ali Wazir should not have been named in the Statement of Claim. They have nothing to do with the claims made by the Plaintiffs.

41With respect to the Counterclaim, it is the Defendants’ position that Default Judgement should be granted. The Defendants submit that the Statement of Defence and Counterclaim were properly filed in accordance with Rule 26.02 and Rule 27.07 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. The Plaintiffs did not file a defence to the Counterclaim. The Plaintiffs were properly noted in default and therefore Default Judgement should be granted.

The Plaintiffs’ Position

42The Plaintiffs submit that Summary Judgement should be granted in the Plaintiffs’ favour. The Defendants falsely accused Ghazala Perveen Beg of theft and initiated the charge against her so that they would not have to pay Ghazala Perveen Beg the money she was owed from the saving circle.

43The Plaintiffs submit that the Defendants went on a campaign of falsely accusing Ghazala Perveen Beg of being a thief. Maira Mahmood went to various boutiques and showed them the video and said Ghazala Perveen Beg was a thief so she could no longer obtain employment.

44Ghazala Perveen Beg claims that she suffered from depression as a result of the campaign against her. She also submits that she could not obtain a job because of the criminal occurrence, as demonstrated by her attempt to obtain employment at the airport. The Plaintiffs submit that Ghazala Perveen Beg and her husband have suffered as a result of the Defendants’ conduct and are therefore entitled to damages.

45The Plaintiffs also claim that they are owed the money from the saving circle and the outstanding wages and other monies owed to Ghazala Perveen Beg when her employment was terminated.

46With respect to the Counterclaim, the Plaintiffs submit that it should be dismissed because it was not filed in accordance with the Rules. In the alternative, the noting in default judgement should be set aside. The Plaintiffs submit that there was no theft in this case; it is the Plaintiffs who have been defrauded by the Defendants.

Legal Principles

47The test for Summary Judgement is set out in Rule 20.04 of the Rules. Rule 20.04(2)(a) states that the Court shall grant Summary Judgement if “the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence.” In considering if there is a genuine issue requiring trial, pursuant to Rule 20.04(2.1) the judge may exercise certain powers “unless it is in the interest of justice for such powers to be exercised only at a trial.” These powers include the following:

1. Weighing the evidence.

2. Evaluating the credibility of a deponent.

3. Drawing any reasonable inference from the evidence.

48The Supreme Court of Canada considered the Summary Judgement regime in Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87. At paragraph 66, Hryniak instructs that the Court’s analysis on a Summary Judgement Motion must take place in two stages:

1. First, the Motion judge must determine if there is a genuine issue requiring a Trial based only on the evidence filed on the Motion, without regard to the fact-finding powers described in Rule 20.04(2.1). No genuine issue requiring a Trial will exist if the evidence permits the Motion judge to fairly and justly adjudicate the dispute in a timely, affordable, and proportional matter. If no genuine issue requiring a Trial exists, the Motion judge must render Summary Judgement.

2. If the Motion judge concludes at the first stage that a genuine issue for Trial exists, the Motion judge is then directed to consider whether a Trial may be avoided by using the enhanced fact-finding powers set out in Rule 20.04(2.1). The Motion judge may exercise those powers, unless doing so would be contrary to the interests of justice.

49The overarching concern is whether the Summary Judgement will provide a fair and just adjudication of the issues. At para. 50 of Hryniak, the Supreme Court explained that when a Summary Judgement Motion allows the judge to find the necessary facts and resolve the dispute, proceeding to Trial would generally not be proportionate, timely or cost effective. On the other hand, where the judge cannot have confidence in their conclusion, Summary Judgement is not a proportionate way to resolve a dispute. The Trial judge has to be sure that they can find the necessary facts and apply the relevant legal principles to resolve the dispute.

50In a Summary Judgement Motion, each party must put its best foot forward by setting out in the Affidavit material, or other evidence, specific facts showing that there is a genuine issue requiring a Trial. For example, if there is a specific fact that must be proven to succeed at Trial and the party having the onus to prove that fact cannot demonstrate there is sufficient evidence, then a Trial is unnecessary: Pammett v. Ashcroft, 2014 ONSC 2447, at paras. 27 and 29.

51In addition, the Court may determine issues of credibility if the Court finds that the record on the Motion is sufficient to make that determination: Zhu v. Kendellhurst Academy Inc., 2018 ONSC 7685, at para. 12. However, as noted by the Court of Appeal in Cook v. Joyce, 2017 ONCA 49, at para. 92, the more important credibility is to determining key issues, the harder it will be to fairly adjudicate those issues solely on a paper record.

Issue #1: Is there a Triable Issue for Malicious Prosecution?

52Certain conditions must be established for a claim of malicious prosecution, as set out in Miazga v. Kvello Estate, 2009 SCC 51, [2009] 3 S.C.R. 339. The four requirements are that the prosecution must have been:

a) initiated by the Defendant;

b) terminated in favour of the Plaintiff;

c) undertaken without reasonable and probable cause; and

d) motivated by malice or by a primary purpose other than carrying the law into effect.

53The bar for establishing malicious prosecution is high, so that citizens are not discouraged from giving statements to the police. Absent exceptional circumstances, the Court will view the police officer who laid the charge as being the person who initiated the prosecution. There are very narrow circumstances in which a private citizen could be found to be the person initiating the prosecution. Simmons J.A. described these narrow circumstances in Kefeli v. Centennial College of Applied Arts and Technology, 2002 CanLII 45008 (Ont. C.A.), as follows:

24I specifically reject the moving party’s submission that the issue of whether Mr. White and Centennial were responsible for setting the prosecution in motion should have been left for trial. The moving party acknowledges that a claim for malicious prosecution requires that the defendant must have initiated the prosecution or set it in motion, and that, ordinarily, the court will view the police officer who laid the charge as being the person who set the prosecution in motion. However, he also submits, correctly, that the complainant may be treated as the prosecutor in exceptional circumstances, including the following:

• the complainant desired and intended that the plaintiff be prosecuted;

• the facts were so peculiarly within the complainant’s knowledge that it was virtually impossible for the professional prosecutor to exercise any independent discretion or judgment; and

• the complainant procured the institution of proceedings by the professional prosecutor, either by furnishing information which he knew to be false, or by withholding information which he knew to be true, or both.

25In addition, the moving party submits that the courts will consider other circumstances in determining whether a particular defendant set a prosecution in motion, and that the core issue is whether there is any evidence to show that “the defendant was actively instrumental in putting the law in force”. Put another way, the issue is whether the defendant “had caused everything to be done which could be done wrongfully to set the law in motion against the [plaintiff] on a criminal charge”. [Emphasis added by Simmons J.A.]

54Some examples of situations where courts have found that the investigation was not independent include where a person knowingly withheld exculpatory evidence, or where a person prepared their statement in a manner that misled the officers into not conducting a proper investigation. See for example Pate Estate v. Galway-Cavendish and Harvey (Township), 2013 ONCA 669, 117 O.R. (3d) 481, at paras. 31 and following; Pate v. Galway-Cavendish (Township), 2011 ONCA 329, 342 D.L.R. (4th) 632, at paras. 46 and following; McNeil v. Brewers Retail Inc., 2008 ONCA 405, 66 C.C.E.L. (3d) 238, at paras. 47-52; and Curley v. Taafe, 2019 ONCA 368, at para. 14.

Who Initiated the Proceedings?

55I am satisfied that there is a genuine issue requiring a Trial on the claim of malicious prosecution given the timing of the alleged theft and the money that appeared to be owed to Ghazala Perveen Beg from the saving circle.

56However, I am satisfied that there is no need to have a Trial on this issue because I can use the enhanced fact-finding powers to resolve whether there is a malicious prosecution by drawing reasonable inferences from the evidence filed on the Motion.

57The Plaintiffs have not put forth any testimonial evidence from the officer who investigated and laid the charge in this matter.

58In the absence of evidence to the contrary, the only reasonable inference to draw from the evidence is that the police exercised independent discretion over their investigation in deciding to charge Ghazala Perveen Beg with theft over $5,000.00.

59The police notes indicate that a report was made to police on June 29, 2017 at 9:51 p.m. An officer attended and spoke to Sabeen Ali on July 5, 2017. Sabeen Ali told police that on May 9, 2017, she had left her purse containing $6,700.00 behind the sales counter and upon returning she noticed the cash was missing. The complainant told police that she reviewed the video surveillance that showed that Ghazala Perveen Beg had gone into her purse. The police viewed the video tape and received a DVD of the surveillance video.

60Sabeen Ali also stated that on March 13, 2017, Ghazala Perveen Beg was observed on video surveillance attempting to take money from the cash sales that day. Ghazala Perveen Beg was observed hiding the cash in a pouch inside the jewellery drawer. Sabeen Ali confronted Ghazala Perveen Beg and Ghazala Perveen Beg stated she was putting it aside for safe keeping.

61The police officer’s notes indicate that the video surveillance showed Ghazala Perveen Beg going into the purse and taking something out and showed Ghazala Perveen Beg hiding money in the drawer.

62Ghazala Perveen Beg was arrested on July 13, 2017 and given a Promise to Appear that was confirmed on August 1, 2017. Her first appearance in Court was set for August 15, 2017.

63Pursuant to Curley, there is no basis to find that the police did not make an independent decision to charge Ghazala Perveen Beg for the following reasons:

• The facts were not so peculiarly within the complainants’ knowledge such that an independent investigation could not take place. In this case, there were surveillance videos which the police considered.

• There is no evidence to suggest that the surveillance videotapes are fake.

• There is no evidence that the Defendants knowingly withheld exculpatory information from the police.

• There is no evidence that the Defendants undermined the independence of the police investigation such as exercising any control over the police officer through a family or friendly connection.

• The absence of any evidence from the police as to the effect Sabeen Ali’s complaint had on their investigation further leads to the reasonable inference that the police exercised independent discretion and judgement over the investigation.

64The malicious prosecution claim must fail on the first requirement to prove malicious prosecution. It is therefore not necessary to consider the other requirements of malicious prosecution.

Issue #2: Is there a Triable Issue for the Claim of Defamation?

65The Defendants submit that there are two bases upon which the claim for defamation can be dismissed by way of Summary Judgement. First, the Plaintiffs did not file a Notice of Action as required by the Libel and Slander Act. Second, there is no evidence that the Defendants made any defamatory statements to third parties.

66The Plaintiffs submit that Summary Judgement should be granted in their favour. The Plaintiffs have provided sufficient evidence to demonstrate that the Defendants defamed Ghazala Perveen Beg in the Motion record. There is no need for a Trial because the Court can make the necessary findings of facts on the paper record.

67In addition, the Plaintiffs have proven that Ghazala Perveen Beg was unable to obtain employment and suffered from depression that was caused by the Defendant’s defamatory statements made against Ghazala Perveen Beg.

i) Does the Failure to File a Notice of Action bar the Prosecution?

68The Defendants submit that the failure of the Plaintiffs to file a Notice of Action is a complete bar to the claim of defamation. In contrast, the Plaintiffs submit that notice was not required because the acts of defamation did not occur in a newspaper or in a broadcast as required by the Libel and Slander Act.

69Section 5(1) of the Libel and Slander Act requires that notice be provided within six weeks after the alleged libel comes to the Plaintiffs’ attention. Section 5(1) reads:

Notice of action

5 (1) No action for libel in a newspaper or in a broadcast lies unless the plaintiff has, within six weeks after the alleged libel has come to the plaintiff’s knowledge, given to the defendant notice in writing, specifying the matter complained of, which shall be served in the same manner as a statement of claim or by delivering it to a grown-up person at the chief office of the defendant.

70Section 5(1) is not just applicable to situations where the defamation occurred in a newspaper or in a broadcast. In Watson v. Southam Inc. (2000), 2000 CanLII 5758 (ON CA), 189 D.L.R. (4th) 695 (Ont. C.A.), at para. 53, the Court of Appeal for Ontario held that there was no principled basis for excluding any defendants from the benefit of the notice provision in s. 5(1). The Court held that “[t]he purpose of the notice requirement is to give a defendant an independent opportunity to issue a retraction, correction, withdrawal or apology for allegedly defamatory statements, thereby mitigating potential damages.”

71In this case, the Defendants had de facto notice of the defamatory statements within the six weeks set out in s. 5(1). The alleged defamatory statements were made sometime after the middle of May 2017 until at least June 29, 2017. The Defendants were served with the Statement of Claim on July 5, 2017. I therefore find that the Defendants had notice of the various defamatory statements they were alleged to have made such that formal notice was not required. The defamation claim is not barred on this basis.

ii) Is there a Triable Issue for the Claim of Defamation?

72Pursuant to Grant v. Torstar Corp., 2009 SCC 61, [2009] 3 S.C.R. 640, at para. 28, to succeed on a claim for defamation, the Plaintiffs must establish that the impugned words:

1. would tend to lower the Plaintiffs’ reputation in the eyes of a reasonable person;

2. referred to the Plaintiff(s); and

3. were communicated to at least one person other than the Plaintiff(s).

73A Defendant may successfully defend a defamation action if they show:

i) that the words complained of were true or justified;

ii) that the words were spoken on a qualified privilege and the Plaintiff cannot show that the Defendant was motivated by actual or express malice; or

iii) that the words are a fair comment made honestly and in good faith on a matter of public interest.

Raymond E. Brown, Defamation Law: A Primer, (Toronto: Thompson Carswell, 2003) at p. 22.

74This case is close to the line in finding that there is not a genuine issue requiring a trial based on the record. However, I am prepared to find that there is a genuine issue, but when I use my enhanced fact-finding powers in assessing the weight to be given to the evidence and the inferences to be drawn from the evidence, the Plaintiffs’ claim for defamation cannot succeed.

75The Court does not need to determine whether Ghazala Perveen Beg actually stole the money as claimed by the Defendants because the Plaintiffs have failed to prove on the balance of probabilities i) what words were said that were defamatory and ii) which Defendant said any defamatory words to a third party.

76I am not satisfied based on the evidence filed that the Defendants made defamatory statements.

77The Plaintiffs’ Affidavit of documents contains a list of people that have “confirmed that allegations of theft spread to the following people by Maira and Sabeen via communications and/or by showing false video/audio which is illegally recorded by Maira and Sabeen.”

78While I accept that information and belief evidence is permissible on Summary Judgement Motions, I must consider the quality of the evidence on the key issue of whether the Plaintiffs have proven the claim of defamation. The Plaintiffs cannot rely on the fact that additional evidence from the list of potential witnesses could substantiate their position at Trial. The Plaintiffs were aware that the Defendants’ position on the Summary Judgement Motion was that there were no defamatory statements made by the Defendants. The Plaintiffs were required to put their best foot forward in responding to the claim that there was no defamation and they failed to do so. Courts cannot allow parties to take a wait and see approach, and not put forth evidence on key issues on Summary Judgement Motions, or there would be no point in having the Summary Judgement Motion: see McPeake v. Cadesky & Associates, 2018 ONCA 554, at paras. 11 and following, and Wallbridge v. Brunning, 2018 ONCA 363, 422 D.L.R. (4th) 305, at para. 23.

79The Plaintiffs have failed to demonstrate that the videos were false or illegally recorded, as they claim. The videos came from the business premises where Ghazala Perveen Beg worked.

80There is also no evidence from the persons to whom the Defendants are alleged to have made the statements to. The Plaintiffs state that the allegations of theft were spread to various people. The Court is unable to ascertain what exactly a particular Defendant said to a particular individual, making it impossible determine whether any statements were in fact defamatory.

81The lack of clarity as to what each Defendant allegedly said is demonstrated in Ghazala Perveen Beg’s examination for discovery. When Ghazala Perveen Beg was asked what defamatory statements Maira Mahmood made, Ghazala Perveen Beg explained that:

Maira showed video to all of them, all boutiques. She showed it to Dhagay Boutique. And to Boutiques in Mississauga and they all called me. And she went to Milton, like to all the boutiques in Milton. She went to the boutique and showed them and said don’t give her any job, she has done this, and she has done that. And she told in the flea market, she went there. [Emphasis added.]

82The above evidence is vague and unclear as to what exactly Maira Mahmood said.

83With respect to defamatory statements made by Sabeen Ali, Ghazala Perveen Beg stated the following in her examination for discovery:

Sabin did, Sabeen called everyone and told. And she told all the people involved in the committee. And still they owe my committee like $7000 they kept. My dresses are with her, my salary is with her.

Sabeen told, informed like everyone in the committee member. Maira told me that Sabeen says that I will make divorced, I’ll do something for the divorce, and I will stop your son’s wedding and same day, she sent police. But we were not at home, we were at the hall. The day of my son’s Nikah.

She told everybody she met and told everybody that I have stolen something. They both like, Husband and wife, went to Juanid (inaudible). That was the reason they didn’t attend the wedding because they told them like the wrong things. [Emphasis added.]

84The statement that Sabeen Ali told everyone that Ghazala Perveen Beg stole something is the only possible defamatory statement that I can find in the evidence, but what was actually conveyed to the third parties is not clear. For example, if Sabeen Ali said to others that the police were investigating Ghazala Perveen Beg for theft and that she provided videos to the police, or that Ghazala Perveen Beg was charged with theft, after she was charged, those statements are true and are not defamatory.

85An ordinary person would understand that the police were investigating the matter and understand that Ghazala Perveen Beg was presumed innocent: see Hakim v. Laidlaw Transit Ltd., 2007 CanLII 11306 (Ont. S.C.), at para 16. Alternatively, something more could have been said, but the Court cannot speculate as to what was said. It is the Plaintiffs’ onus to demonstrate that the words used by each Defendant were defamatory.

86The Court is also not satisfied that any of the Facebook postings or text messages constitute defamatory statements. For example, the Facebook posting by Maira Khurram (Mahmood) states: “Need some legal advise [sic] related to a theft at the store..any lawyers out there?” The post does not name the Plaintiff. It does not even say whether the theft was by an employee of the store. I do not find that this statement is defamatory towards Ghazala Perveen Beg.

87The text messages to the saving committee also do not contain defamatory statements. In those messages, Sabeen Ali tells the members that the June cheque is not going out right now because Ghazala Perveen Beg is away. Ghazala Perveen Beg responds that she was not away. Sabeen Ali sent another text saying that they agreed that “until our store dispute is settled” the cheques will remain on hold. Sabeen Ali then stated that she did not want to bring the store dispute in this group but Ghazala Perveen Beg’s message forced her to. Sabeen Ali stated that if any committee members have any questions, then she is more than happy to schedule a meeting and discuss as this matter has already been reported to the police. It is clear from this text that the police matter involved Ghazala Perveen Beg. Later that evening, another member of the circle group, Sukaini Bhojani, responded that Sabeen Ali had already updated her about the issue with this committee member. There are no details as to what she was updated about. As noted above, if Sukaini Bhojani were advised that Sabeen Ali had gone to the police and provided videos to the police, that was true and not defamatory. The difficulty is that the Court has no evidence as to what exactly was said, so the Court cannot determine that the statements were defamatory.

88The Plaintiffs also claim that the Defendants made defamatory statements to all the saving circle members. There is no evidence that Sabeen Ali or any other Defendant “met up to explain” what happened to other members of the saving circle, aside from the conclusory statement of the Plaintiffs.

89The WhatsApp text messages between Ali Wazir and Mirza Izhar Beg also do not contain any defamatory statements. The WhatsApp text message and audio message dated May 25 and May 29, 2017, discuss how to proceed with this matter and discuss meeting at a Tim Hortons.

90Ghazala Perveen Beg stated that Ali Wazir misbehaved at the Tim Hortons meeting. He recorded things and was rude to her and her husband. He threatened her and said that he had evidence and he would post it on Facebook. He said he would do this, and he would do that. Ms. Beg testified on her examination for discovery that he went to a family friend and she claims that the Defendants ruined her son’s wedding. She said they (husband and wife) went to “Junaid’s house and they said something, I don’t know what.” Junaid then called her son, and they did not attend the wedding. Ms. Beg stated that Ali Wazir “didn’t give any statement. but he defamed us everywhere. And who gave him the right to do this?” She stated that he said: “they have stolen things, but we don’t have the evidence.” She did not identify whom he said this to and whether these were the actual words used or rather her belief of what the message conveyed.

91There is no evidence that Khurrum Naseer, Maira Mahmood’s husband, made any defamatory, false, or injurious statements about Ghazala Perveen Beg. Ghazala Perveen Beg admitted this in her examination for discovery. She also stated that the Plaintiffs offered to have Khurram Naseer’s name removed from the litigation.

92I am also not satisfied that there is a sufficient basis to find that third parties were told defamatory statements. There is only hearsay evidence that the information was sent to third parties, aside from Sukaini Bhojani. Again, I recognize that information based on belief is permissible on a Summary Judgement Motion, but with a complete lack of information as to what was said to the third parties and any independent evidence as to who the statements were said to, I am not satisfied on the balance of probabilities that the defamatory statements were in fact made to the individuals as claimed by the Plaintiffs.

93Based on the evidence filed, the Plaintiffs have only provided bald statements that the Defendants made defamatory statements to members of the community. The Plaintiffs have not proven that defamatory statements were made. The Plaintiffs’ evidence is vague and unclear as to what exactly was said to each of the third parties in the Plaintiffs’ list of people who were told “allegations of theft.” As previously noted, if the statements explained that either the police were investigating a theft based on the video tapes or that Ghazala Perveen Beg was charged, that is not a defamatory statement. The Plaintiffs have failed to demonstrate that the words spoken by any of the Defendants to any third parties were defamatory. The Plaintiffs’ claim for defamation cannot succeed on the Summary Judgement Motion.

Issue #3: Is there a Triable Issue for the Claim of Theft/Fraud of the Saving Circle Money, Lost Income, and Other Items?

94Although I am satisfied that the claims for malicious prosecution and defamation should be dismissed by way of Summary Judgement, that does not address all of the claims raised by the Plaintiffs. The Plaintiffs claim that they are owed the saving circle money and that Ghazala Perveen Beg is owed other monetary damages related to the termination of her employment.

95I do not accept the Defendants’ position that the Plaintiffs’ Statement of Claim has nothing to do with the saving circle money. The Plaintiffs pled that the reason for the false allegations was that the Defendants wanted to defraud Ghazala Perveen Beg of the money owed to her from the saving circle. The Statement of Claim also pleads that the Defendants’ failed to pay Ghazala Perveen Beg monies owed for salary and other items after she was terminated.

96I am satisfied that the issues raised by the Plaintiffs regarding these claims raise a genuine issue for Trial. Unfortunately, I am not satisfied that I can resolve the amount owed from the saving circle and other claims resulting from the Plaintiff’s termination based on the paper record.

97There is strong evidence to suggest that Ghazala Perveen Beg was entitled to the saving circle money for the month of June 2017. Sabeen Ali admits as much in her text message when she says they agreed that Ghazala Perveen Beg would not be paid until the issue with the store was resolved. There are two key factual matters that require the Court to determine the credibility of Ghazala Perveen Beg, Sabeen Ali, and Maira Mahmood that I do not feel I can confidently make based on a paper record.

98First, it appears that Ghazala Perveen Beg agreed to give the cheques back until the issues with the store were worked out. If that was done on agreement, then Ghazala Perveen Beg may not be entitled to the money. There is no documentation as to what was discussed. The credibility of Ghazala Perveen Beg and Sabeen Ali is critical in resolving whether the money is owed to Ghazala Perveen Beg.

99Second, Ghazala Perveen Beg denies she stole anything and submits that the Defendants defrauded/stole the saving circle money and unlawfully withheld money owed to her. In contrast, the Defendants submit that Ghazala Perveen Beg stole from them and they did not defraud or steal the saving circle money. The credibility of the parties is key in determining if there was a theft or monies owed by either party. I cannot make the necessary factual findings based on the record before me.

100The other difficulty I have with the paper record is that it is not clear from the record what the total amount is owing from the saving circle. In the Statement of Claim, the amount listed is $10,000.00. On exhibit “K” to Ghazala Perveen Beg’s August 20, 2018 Affidavit she claims that it is $7,000.00. Another document provided by Ghazala Perveen Beg states that the amount is to be $11,000.00.

Issue #4: Should Default Judgement be Granted on the Counterclaim?

101The Plaintiffs submit that the Defendants did not file the Counterclaim in accordance with the Rules and therefore the Counterclaim is not properly before the Court and should be dismissed. In the alternative, the Plaintiffs ask that the noting of default be set aside.

102The Defendants submit that they complied with the Rules. The Plaintiffs have been aware of the Counterclaim since the discovery and have done nothing to indicate that they intended to defend the matter. The matter was properly noted in default and therefore Default Judgement should be granted.

103The Plaintiffs filed their Statement of Claim on July 5, 2017. Rule 18.01 requires that the Statement of Defence be served within twenty days after service of the Statement of Claim. The Defendants filed their Statement of Defence on July 31, 2017. Technically, the Statement of Defence was filed late. On August 1, 2017, the Defendants filed a second Statement of Defence and Crossclaim but did not specify that it was an Amended Statement of Defence.

104Rule 26.02 permits a party to amend a pleading “without leave, before the close of pleadings, if the amendment does not include or necessitate the addition, or deletion or substitution of a party to the action.”

105The pleadings were not closed when the Defendants filed the second Statement of Defence and Counterclaim and therefore leave of the Court was not required to file the Second Statement of Defence. The relevant portion of Rule 25.05 states that pleadings are not closed until the Plaintiff “has delivered a reply to every defence in the action or the time for delivery of reply has expired.” The time to file a reply is ten days after the Statement of Defence is filed: r. 25.04(3). In this case, the Defendants filed the Statement of Defence on July 31, 2021, which was within ten days after the Statement of Defence was filed.

106While I find that the Statement of Defence and Counterclaim were properly filed with the Court, that does not end the matter. Rule 19.03 states that the noting of default may be set aside by the Court on such terms as are just.

107The test for setting aside a noting of default is different from the test for setting aside a Default Judgement. In considering whether the Court should exercise its discretion to set aside a noting of default, the Court “should assess the context and factual situation of the case”, including the behaviour of the Plaintiff and the Defendant, the length of the Defendant’s delay, the reasons for the delay and the complexity and value of the claim as well as the prejudice to either party. In only extreme circumstances should the Court require a Defendant who has been noted in default to demonstrate an arguable defence on the merits: Intact Insurance Company v. Kisel, 2015 ONCA 205, 125 O.R. (3d) 365, at paras. 12-14, referring to Metropolitan Toronto Condominium Corporation No. 706 v. Bardmore Developments Ltd. (C.A.) (1991), 1991 CanLII 7095 (ON CA), 3 O.R. (3d) 278 (C.A.), at pp. 284-85.

108I am satisfied that in the circumstances that it is appropriate to set aside the noting of default for the following reasons.

109First, the noting in default took place in February 2021. The Plaintiffs did not move to set aside the noting of default until the Motion for Summary Judgement on April 14, 2021. The reason set for not moving to set aside the noting in default sooner was that the Plaintiffs took the position that the Statement of Defence was not properly before the Court, which was argued at the April Motion date.

110Second, I am satisfied that there is a plausible excuse for why the Plaintiffs did not comply with the Rules. The parties were not represented when the second Statement of Defence was filed, and it did not say that it was amended.

111While the Plaintiff’s should have filed a Statement of Defence when they learned that there was a Counterclaim, it was clear by that time that the issues raised in the Counterclaim were interrelated to the issues on the main claim. The Counterclaim alleges that Ghazala Perveen Beg stole money and property from the Defendants. The Plaintiffs claim that the Defendants lied about Ghazala Perveen Beg stealing anything in an attempt to fraudulently keep the saving circle money. A finding that Ghazala Perveen Beg did not steal anything would support the Plaintiff’s claim and undermine the Defendants’ Counterclaim. The interrelatedness of the two issues is demonstrated by the fact that the Plaintiffs’ counsel asked the Defendants for the store accounts that would show the account of cash that would be in the store to refute the allegations of theft. The Defendants refused to provide any such accounts.

112Third, this is not a case where the Plaintiffs ignored or avoided participating in the proceedings.

113Fourth, I recognize that there is some prejudice to the Defendants in that they will have to incur costs to proceed with their claim. However, there is also prejudice to the Plaintiffs in that they would be required to pay for monies owed that they have stated since the beginning of the legal proceedings that Ghazala Perveen Beg did not steal.

114Fifth, if Default Judgement is granted there is a risk of inconsistent findings of fact. I have already determined that the Plaintiffs’ claim for the saving circle money and other monies that Ghazala Perveen Beg says she is owed, should proceed to Trial. The Plaintiffs’ position is that the Defendants falsely accused Ghazala Perveen Beg of stealing money because they wanted her saving circle money. If Default Judgement is granted on the Counterclaim, there would have to be a finding that Ghazala Perveen Beg stole the money. Another judge after hearing the evidence on the Plaintiffs’ claim may not come to that conclusion.

115In the circumstances, I am satisfied that the integrity of the administration of justice would be adversely affected if I were to grant Default Judgement given the real risk of inconsistent findings of fact in light of the Plaintiffs’ outstanding claim. This factor, along with the other factors stated, lead me to conclude that it is just to have the noting in default of the Counterclaim set aside and have the Counterclaim proceed to Trial along with the Plaintiffs’ remaining claims.

Issue #5: What Should Happen Next?

i) Is it Appropriate to Grant Partial Summary Judgement in this Case?

116The Court of Appeal for Ontario has cautioned against granting partial Summary Judgement except where there is “no risk of duplicative or inconsistent findings at trial and that granting summary judgment [is] advisable in the context of the litigation as a whole”: Canadian Imperial Bank of Commerce v. Deloitte & Touche, 2016 ONCA 922, 133 O.R. (3d) 561, at para. 4.

117In Butera v. Chown, Cairns LLP, 2017 ONCA 783, 137 O.R. (3d) 561, at para. 34, the Court of Appeal for Ontario cautioned that partial Summary Judgement should be considered a rare procedure. It should only be used in limited circumstances where an issue or issues may be readily bifurcated from those in the main action and dealt with expeditiously and in a cost-effective manner.

118I find that it is appropriate to grant partial Summary Judgement in favour of the Defendants on the claims of malicious prosecution and defamation. The Plaintiffs’ claims failed because they did not demonstrate that the Defendants initiated the criminal charges and police did not act independently. The Plaintiffs also failed to demonstrate that the Defendants made defamatory statements to various third parties. The fact that the Plaintiffs may be able to provide better evidence at a Trial is not a reason to deny granting partial Summary Judgement. The parties on a Summary Judgement Motion are expected to put their best foot forward, particularly on key issues.

119There is no risk of inconsistent findings in granting partial Summary Judgement. In dismissing the malicious prosecution and defamation claim, the Court did determine whether the Plaintiff stole the money. In contrast, on the Plaintiffs’ outstanding claim for the saving circle money and other monies owed and the Counterclaim the Court will have to determine whether the Plaintiff stole the money and other items as claimed by the Defendant. In addition, the Court will have to determine if the Defendants defrauded/stole the saving circle money and owe other monies to the Plaintiffs.

120Granting partial Summary Judgement is also more expeditious and cost-effective. If all of the claims were to go to Trial, it would create unnecessary delay and unnecessarily complicate the litigation. The claim for malicious prosecution would be more complicated and likely require evidence from the police officer who laid the criminal charge against Ghazala Perveen Beg. With respect to the defamation claim, the Trial would be significantly longer because there would likely be evidence from all of the individuals who heard the alleged defamatory statements from the Defendants. Evidence, I might add, that was not put forward on the Summary Judgement Motion.

121In contrast, by focusing on the claims regarding whether Ghazala Perveen Beg stole money and other items from the Defendants and whether the Defendants stole or owe money to the Plaintiffs, the Trial will be very focused. The Trial will be focused on the video surveillance tapes and the credibility of Ghazala Perveen Beg, Sabeen Ali, and Maira Mahmood in determining who stole various items and who owes money.

ii) Should this matter Proceed in Small Claims Court or by Simplified Procedure?

122The Plaintiffs’ outstanding claims are $7,000.00-$11,000.00 for the saving circle money, income in the amount of $1,006.67 and a further $1,800.08 for other outstanding items for a total of $9,806.67-$13,806.67. The amount claimed by the Defendants is $35,000.00. The matter may therefore proceed in Small Claims Court or in Superior Court using the simplified procedure.

123If the parties are not able to agree on what forum this matter should continue within thirty days of my decision, the parties may contact the Trial Coordinator’s office and arrange to make further submissions before me.

iii) Should Ali Wazir, Khurrum Naseer, and Mirza Izhar Beg remain Parties in these Proceedings?

124I am of the view that there was no basis to name Khurrum Naseer as a party. The claim against him is dismissed in its entirety. He should never have been named as a party in the first place. There is no evidence that Khurram Naseer had anything to do with the criminal charge laid against Ghazala Perveen Beg. Ghazala Perveen Beg stated in her examination for discovery that Khurrum Naseer did not make any defamatory, false, or injurious statements against her. There is also no evidence that Khurrum Naseer had anything to do with the saving circle. The Plaintiffs offered to have their claim against the Defendant Khurram Naseer withdrawn in a letter dated May 16, 2019 and submitted that if Mr. Naseer continued to participate then he would be responsible for such costs.

125In contrast, there was a basis to name Ali Wazir in the Statement of Claim initially. It was alleged that he made injurious statements to the others including Junaid Khan such that he could have been found to be a party to the defamation if his statements were found to be defamatory.

126However, I am of the view that all claims against Ali Wazir should be summarily dismissed at this time. I have come to this conclusion given my finding that the Plaintiffs’ claim of malicious prosecution and defamation should be summarily dismissed. Ali Wazir is not involved with the remaining claim involving the Plaintiffs. He does not own the companies from which it is alleged Ghazala Perveen Beg stole from and there is no evidence that he is involved in the saving circle.

127I am satisfied Mirza Izhar Beg should continue to be named in the proceedings against the remaining Defendants because the cheques paid into the saving circle were made out of Ghazala Perveen Beg and Mirza Izhar Beg’s joint banking account and therefore he may have an interest in the proceeds from the saving circle money.

Final Orders

128I make the following orders:

1. The Defendants’ Motion for Summary Judgement is granted in its entirety as it relates to Ali Wazir and Khurrum Naseer.

2. Partial Summary Judgement is granted as it relates to the claims of malicious prosecution and defamation against Maira Mahmood, Sabeen Ali, Precious by Maira, and Sabz Haute Couture.

3. The Plaintiffs’ claims with respect to the saving circle money, and other monies owed as a result of Ghazala Perveen Beg’s employment termination, are not dismissed by way of Summary Judgement but are to proceed to Trial against the Defendants Maira Mahmood, Sabeen Ali, Precious by Maira and Sabz Haute Couture.

4. The noting of default of the Counterclaim is set aside. The Plaintiffs are to file a Statement of Defence within thirty days of the release of this decision.

5. If the Parties are not able to agree whether the remaining issues in the Statement Claim and Counterclaim should proceed in Small Claims Court or in the Superior Court by way of simplified procedure, the Parties may contact the Trial Coordinator to arrange to make further submissions before me at 9:00 a.m. prior to the commencement of Court.

Costs

129Given the divided success on this Motion, the parties are encouraged to work out the issue of costs between themselves.

130If the Parties are unable to resolve the issue of costs, the Defendants shall serve and file written submissions of no more than two pages, double spaced, twelve-point font, relevant case law, and any offers to settle within ten days of receipt of this judgement.

131The Plaintiffs may file a response consisting of written submissions of no more than two pages, double spaced, twelve-point font, relevant case law and any offers to settle within ten days receipt of the Defendants’ submissions.

132The Defendants may file a one-page reply, double spaced, twelve-point font, within five days of receipt of the Plaintiffs’ submissions on costs.

__________________________ Dennison J.