Court File and Parties

Court File No.: CV-17-580805 Date: 2021-06-01 Superior Court of Justice - Ontario

Re: 2504027 Ontario Inc. o/a S-Trip! And: Canadian Broadcasting Corporation (CBC) et al.

Before: J.T. Akbarali J.

Counsel: Jeff Saikaley, for the plaintiff M. Philip Tunley and Lillianne Cadieux-Shaw, for the defendants

Heard: In writing.

Endorsement

[1] On May 11, 2021, I released reasons granting the defendants’ motion for an order dismissing the plaintiff’s claim under s. 137.1 of the Courts of Justice Act, R.S.O. 1990, c. C.43, on the basis that it was a strategic lawsuit against public participation: 2021 ONSC 3471. I found that the plaintiff’s claim had substantial merit, but that the plaintiff failed to discharge its onus to demonstrate that the defendants did not have a valid defence to the action – in this case, the defence of fair comment. I also found that the plaintiff had not met its burden to establish that its losses were caused by the expression at issue.

[2] This endorsement addresses the costs of the plaintiff’s action.

[3] The three main purposes of modern costs rules are to indemnify successful litigants for the costs of litigation, to encourage settlement, and to discourage and sanction inappropriate behaviour by litigants: Fong v. Chan (1999), 1999 2052 (ON CA), 46 O.R. (3d) 330, at para. 22.

[4] Subject to the provisions of an Act or the rules of court, costs are in the discretion of the court, pursuant to s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43. The court exercises its discretion taking into account the factors enumerated in r. 57.01 of the Rules of Civil Procedure, including the principle of indemnity, the reasonable expectations of the unsuccessful party, and the complexity and importance of the issues. Overall, costs must be fair and reasonable: Boucher v. Public Accountants’ Council for the Province of Ontario, 2004 14579 (Ont. C.A.), 71 O.R. (3d) 291, at paras. 4 and 38. A costs award should reflect what the court views as a fair and reasonable contribution by the unsuccessful party to the successful party rather than any exact measure of the actual costs to the successful litigant: Zesta Engineering Ltd. v. Cloutier, 2002 25577 (ON CA), 2002 CarswellOnt 4020, 118 A.C.W.S. (3d) 341 (C.A.), at para. 4.

[5] There are special legislative provisions that impact costs awards in motions brought under s. 137.1. Under s. 137.1(7) of the Courts of Justice Act, when a judge dismisses a proceeding under s. 137.1, “the moving party is entitled to the costs on the motion and in the proceeding on a full indemnity basis unless the judge determines that such an award is not appropriate.”

[6] When deciding how a judge should exercise her discretion under s. 137.1(7), she will be “guided by the considerations that guide the exercise of discretion with respect to costs in other civil proceedings,” including the factors set out in r. 57.01, and the overriding objective that the award be fair and reasonable: Fortress Real Developments Inc. v. Rabidoux, 2018 ONCA 686, at para. 63.

[7] I note that the legislation is designed to encourage defendants to make use of s. 137.1. When a defendant is not successful in dismissing an action under s. 137.1, the presumption is that the plaintiff will not be awarded costs on the motion: Kam v. CBC, 2021 ONSC 2537 at para. 6, citing Defamation Law in the Internet Age (Final Report) (Toronto: Law Commission of Ontario, 2020), at p. 52.

[8] The policy behind these costs provisions is to discourage large and powerful plaintiffs from using litigation to shut down public debate, and to encourage counsel to take on the defence of defamation actions where the vulnerable defendant would be unlikely to be able to pay: Niagara Peninsula Conservation Authority v. Smith, 2018 ONSC 127, at para. 12.

[9] In B.W. (Brad) Blair v. Premier Doug Ford, 2021 ONSC 695, at para. 3, Belobaba J. held that a full indemnity costs award was not appropriate although he had dismissed the plaintiff’s proceeding under s. 137.1, because the plaintiff’s defamation action was not a SLAPP suit. He noted that the plaintiff was not a large and powerful entity that was using litigation to intimidate a smaller and more vulnerable opponent and silence their public expression. In Kam, at para. 8, Papageorgiou J. relied on Belobaba J.’s analysis in support of her decision not to award full indemnity costs in a proceeding dismissed under s. 137.1.

[10] The plaintiff here invokes this principle, and states that an award of only partial indemnity costs is appropriate here. It argues that this litigation does not bear the hallmarks of a SLAPP suit. I agree.

[11] The plaintiff in this case is not a powerful entity using litigation to intimidate a smaller and more vulnerable opponent and silence its expression. Moreover, the plaintiff established that its case had substantial merit. I found that there was a real prospect of success that the juxtaposition between the reporting of the death of a participant on one of the plaintiff’s graduation trips with the content of a Marketplace report that raised questions about the adequacy of the plaintiff’s supervision of students on those trips, implied, or at least raised the question whether, the plaintiff’s failure to adequately supervise the students caused or contributed to the death. I found that even raising the question lowered the plaintiff in the estimation of right-thinking members of society generally. The plaintiff’s claim was not frivolous.

[12] The defendants allege that the plaintiff’s claim was retaliatory, because the plaintiff did not pursue litigation against other entities that reported on the participant’s death. They also point to the plaintiff’s complaint to the CBC ombudsman about the Marketplace report, which complaint was eventually dismissed.

[13] I do not agree with the characterization of the plaintiff’s proceeding as retaliatory. First, the plaintiff was entitled to avail itself of the procedure to complain about the CBC’s Marketplace report to the ombudsman. There is no reason to penalize it for having done so. Second, most of the other news outlets reported only on the participant’s death, without linking it in any way to the plaintiff’s conduct. One outlet did draw the link, but was not sued. This on its own does not satisfy me that the plaintiff’s proceeding was taken in retaliation for the Marketplace report, especially when I found that there was substantial merit to the plaintiff’s claim.

[14] Accordingly, I find that this is an appropriate case in which to exercise my discretion to award only partial indemnity costs.

[15] The plaintiff raises another concern with respect to the quantum of costs. While it agrees that the time spent by defendants’ counsel, their hourly rates, and the disbursements incurred are reasonable, it seeks a reduction of costs on the basis that the defendants delayed in bringing this motion until after documentary discovery was complete. It notes that the defendants first raised the possibility of moving under s. 137.1 in 2018.

[16] In Levant v. Day, 2019 ONCA 244, at para. 29, the Court of Appeal noted that, given the serious costs consequences that can result from anti-SLAPP motions, “these motions should be brought early in the proceedings.”

[17] The defendants argue that they brought their motion promptly once the plaintiff disclosed sufficient particulars supporting its claim for damages, which they argue the plaintiff should have done when providing its affidavit of documents, but did not do until more than two years had passed after the commencement of the litigation. They note they took next to no steps in the intervening time period, and brought the motion before examinations for discovery to keep costs down.

[18] The defendants principally succeeded on the motion on the basis of the defence of fair comment. Although I also found the plaintiff had not met its burden to establish that its losses were caused by the expression at issue, I undertook that analysis only for completeness of the record. Given this result, the motion could have been brought at an earlier time, although the defendants might then have judged it to have a lower prospect of success.

[19] The defendants’ bill of costs discloses full indemnity fees of $102,435.00, plus HST and disbursements, totaling $128,217.60. On a partial indemnity basis, fees would be $61,461. After HST and disbursements, the total claim for partial indemnity fees would be $81,916.98.

[20] The plaintiff argues that partial indemnity fees of $60,000 all inclusive are warranted to account for the delay.

[21] In my view, some discount is warranted to account for the delay in bringing the motion, but only a modest one. I find that a costs award of $75,000 is fair and reasonable in these circumstances.

[22] The plaintiff shall pay the defendant $75,000 in costs, all inclusive, within thirty days.

J.T. Akbarali J.

Date: June 1, 2021