Court File and Parties
COURT FILE NO.: CV-20-89 DATE: 2021/08/03 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Brian Manese, Plaintiff AND: Kathryn Kissinger and Kathryn Kissinger HR Services, Defendants
BEFORE: Justice D.A. Broad
COUNSEL: Dennis Touesnard, for the Plaintiff Erik L. Shum, for the Defendants
HEARD: July 8, 2021
Endorsement
1The plaintiff on this motion seeks an Order pursuant to Rule 25.11 striking certain paragraphs in the Statement of Defence as being irrelevant, argumentative, speculative and inserted merely for colour.
Background
(a) The Parties
2The plaintiff and his former wife Heidi Wilmot-Smith (“Smith”) are the sole shareholders in Lifeguard Homecare Inc. (“Lifeguard”). At all material times the plaintiff was the Secretary-Treasurer of Lifeguard and Smith was the President.
3The defendant Kathryn Kissinger (the “defendant”) is a certified human resources professional who at all material times carried on business as a sole proprietor under the business name “Kathryn Kissinger HR Services”. Although named as a defendant in the Statement of Claim, “Kathryn Kissinger HR Services” is not a separate legal entity.
4Lifeguard retained the defendant to carry out a workplace harassment investigation in respect of complaints of harassment made by certain employees and former employees of Lifeguard against the plaintiff and Smith. The Statement of Claim alleges that the defendant was retained by Lifeguard for this purpose on or about November 14, 2019 whereas the Statement of Defence alleges that the defendant was retained by Lifeguard by means of a Consulting Services Agreement dated June 30, 2019.
(b) Statement of Claim
5In the Amended Statement of Claim the plaintiff alleged, inter alia, the following:
(a) it was an express or implied term of the retainer of the defendant by Lifeguard that the defendant would carry out the investigation to the standards of a competent Human Resources Professional Association (“HRPA”) professional and would only communicate the results of her investigation with Lifeguard;
(b) the defendant owed the plaintiff a duty of care to conduct the investigation to the standards of a competent HRPA professional;
(c) the defendant breached the standard of care of a competent HRPA professional by investigating matters outside the scope of an ordinary workplace investigation, opining on matters outside the scope of her retainer, and by publishing the report to the attention of employees of Lifeguard without authorization;
(d) the defendant breached the standard of care of a competent HRPA professional by publishing defamatory and libelous comments about the plaintiff in her report, including:
(i) “police should be provided with a copy of this report to see if there are any charges that could be brought against [the plaintiff] for harassment and domestic violence in the workplace”;
(ii) “one has to wonder if there is in some sort of mental illness that is spurring this very irrational behaviour”; and
(iii) The plaintiff is “deliberately trying to undermine and destroy the Lifeguard business, staff and [Smith] personally.”
(e) the defendant circulated a Summary of Findings of the investigation to all office staff and to Lifeguard which made the following statements, inter alia, which are “similarly defamatory”:
(i) the investigation is supported by the allegation that the plaintiff engages in behaviour that meets the definition of workplace harassment and workplace violence as it relates to domestic violence. The Occupational Health and Safety Council of Ontario defines domestic violence in the workplace as:
… A pattern of behaviour used by one person to gain power and control over another with whom he/she has had an intimate relationship…
… Domestic violence becomes workplace violence or harassment when it occurs or spills over into the workplace. It is also known as Personal Relationship Violence, Intimate Partner Violence, Women Abuse or Family Violence
(ii) I have made recommendations to [Smith] on how to proceed with obtaining assistance with these matters and recommended in my report that [the plaintiff] be immediately removed from all managerial control of Lifeguard.
(f) the defendant further breached the standard of care of a competent HRPA professional in that she made no efforts to clarify the insinuation in the Staff Summary that he engaged in physical or sexual domestic violence against Smith;
(g) as a result of the defamatory and libelous comments in the report and in the Staff Summary the plaintiff has suffered humiliation, embarrassment, loss of his standing with employees at Lifeguard, and injury to his standing and reputation in the community;
(h) the defendant’s conduct is capricious, high-handed and deserving of punishment and that he is entitled to an award of punitive and exemplary damages; and
(i) as a result of the defendant’s breach of the standard of care expected of an HRPA professional, he has suffered damages including damage to his own reputation and damages as result of the devaluation of Lifeguard flowing from the defendant’s report and the Staff Summary.
Statement of Defence
6After reciting various allegations of fact, the defendant pleaded in the Statement of Defence that:
(a) she did not breach her standard of care or duty of care owed to the plaintiff, if any, and in particular, did not breach any express or implied term of the retainer between the defendant and Lifeguard or the standard of care of human resources professional, certified or otherwise;
(b) the defendant’s services were conducted in a good, reasonable and professional manner, meeting the standard of care of a competent human resources professional or one certified by the HRPA and, in particular, were conducted within the scope set by Lifeguard and/or all applicable statutes, regulations and HRPA requirements;
(c) the results of the investigation were communicated by the defendant only to those who had an interest in the underlying investigation and to those with a right to know the results, specifically in accordance with the instructions of Lifeguard and/or applicable statutes, regulations and professional requirements;
(d) the comments alleged to be defamatory and/or libelous in the Amended Statement of Claim were not accurately quoted and/or do not have the meaning stated or implied by the plaintiff;
(e) the comments alleged by the plaintiff to be defamatory and/or libelous would not cause the intended or actual recipients thereof to think less of the plaintiff;
(f) the plaintiff has not suffered humiliation, embarrassment, loss of standing and/or injury to his standing and/or reputation as a result of the comments;
(g) Lifeguard did not suffer any devaluation as result of any acts or omissions of the defendant and the plaintiff lacks standing to bring such a claim;
(h) the defendant pleads the defence of justification. The “Three Comments” [defined in the Statement of Defence as the comments alleged by the plaintiff to be defamatory and/or libelous] were substantially true and/or were reasonably believed by the defendant to be substantially true and the defendant did not have a reckless disregard to the truth or falsity of the Three Comments;
(i) the plaintiff has behaved in a manner consistent with the comments before, during and after the investigation and the plaintiff thereby caused or contributed to his losses; and
(j) the plaintiff has failed to mitigate his losses and has permitted recipients of the Three Comments to think less of him or to believe any alleged insinuation.
Paragraphs in the Statement of Defence sought by the plaintiff to be struck
7The paragraphs in the Statement of Defence which the plaintiff seeks to have struck pursuant to Rule 25.11 (the “impugned paragraphs”) are as follows:
Paragraph 9:
“On or about November 6, 2018, Smith alleged that the plaintiff threatened Smith in or around the Lifeguard office by indicating that he would ‘take [Smith] down by breaking [Smith] financially’ and that Smith would have to ‘work on her back’.”
Paragraph 20:
“On or about December 4, 2019, the plaintiff refused to allow Lifeguard to pay the Defendants with respect to the Kissinger Investigation.”
Paragraph 35:
“Further, and in any event, the plaintiff has behaved in a manner consistent with the Three Comments before, during and after the Kissinger Investigation and the plaintiff thereby caused or contributed to his losses, which are not admitted but expressly denied.”
Legal Framework
(a) Rule 25.11
8Rule 25.11 of the Rules of Civil Procedure provides as follows:
The court may strike out or expunge all or part of a pleading or other document, with or without leave to amend, on the ground that the pleading or other document,
(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.
9The plaintiff relies primarily on para. 25.11(b), arguing that the impugned paragraphs in the Statement of Defence are scandalous, frivolous or vexatious, and secondarily relies on para. 25.11(a), arguing that they may prejudice or delay the fair trial of the action. He does not argue that they represent an abuse of the process of the court pursuant to para. 25.11(c).
(b) Guiding Principles re: Rule 25.11
10Nordheimer, J. (as he then was) in the case of Abdi Jama (Litigation Guardian of) v. McDonald’s Restaurants of Canada Ltd., [2001] O.J. No. 1068 (S.C.J.) stated at para 21 that the principles that should be applied on a motion under rule 25.11 include the following:
(a) motions under rule 25.11 should only be granted in the "clearest of cases";
(b) any fact which can affect the determination of the rights of the parties can be pleaded but the court will not allow facts to be alleged that are immaterial or irrelevant to the issues in the action;
(c) portions of a pleading that are irrelevant, argumentative or inserted for colour, or that constitute bare allegations should be struck out as scandalous;
(d) facts may be pleaded but not the evidence by which those facts are to be proved - rule 25.06(1) of the Rules of Civil Procedure;
(e) similar facts may be pleaded as long as the added complexity arising from their pleading does not outweigh their potential probative value.
(c) Guiding Principles re: para. 25.11(b)
11In the recent case of Abbasbayli v. Fiera Foods Company, 2021 ONCA 95 (C.A.) the Court of Appeal emphasized that, in considering whether a pleading, or portion thereof is scandalous, frivolous or vexatious, the focus is on its relevance. Van Rensburg, J.A., writing for the panel, stated as follows at para. 49:
Rule 25.11(b) provides that 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 is "scandalous, frivolous or vexatious". A scandalous pleading includes those parts of a pleading that are irrelevant, argumentative or inserted for colour, and unfounded and inflammatory attacks on the integrity of a party: see George v. Harris, [2000] O.J. No. 1762 (Ont. S.C.J.), at para. 20. The focus in considering a challenge to a pleading under this rule is on the relevance of the pleading to a cause of action or defence. As this court recently noted in Huachangda Canada Holdings Inc. v. Solcz Group Inc., 2019 ONCA 649, 147 O.R. (3d) 644 (Ont. C.A.), at para. 15, "[a] fact that is relevant to a cause of action cannot be scandalous, frivolous or vexatious. On the other hand, a pleading that raises irrelevant or superfluous allegations that cannot affect the outcome of an action is scandalous, frivolous or vexatious, and should be struck out".
12See also the observations of D.M. Brown, J. (as he then was) in the case of Re Rare Charitable Reserve v. Chaplin, [2009] O.J. No. 3893 (S.C.J.) at para. 22 as follows:
… the facts pleaded in a statement of claim or defence must relate to the elements of the claim or defence. Portions of a pleading that are irrelevant, argumentative, speculative, inserted merely for colour, or that constitute bare allegations or unfounded and inflammatory attacks on the integrity of a party are treated as scandalous and struck out under Rule 25.11(b) as offending the basic principles of pleadings: George v. Harris, [2000] O.J. No. 1762 (Ont. S.C.J.), para. 20. So, too, unnecessary historical recitation which is irrelevant to the cause of action or defence in issue should be struck: Lac des Mille Lacs First Nation v. Canada (Attorney General), [2002] O.J. No. 1977 (Ont. S.C.J.), para. 51.
(d) Guiding Principles re para. 25.11(a)
13With respect to the question of prejudice or delay to the fair trial of the action, the Court of Appeal in the case of Quizno’s Canada Restaurant Corp. v. Kileel Developments Ltd., [2008] ONCA 644 (C.A.) noted that, even where the allegations in the impugned pleading are relevant, they are subject to being struck out if they have marginal probative value which is outweighed by their prejudicial effect. However, the power to strike pleadings in such circumstances should be approached with considerable caution. The Court added that a “fair” trial calls for the defendant to be able to present a “full” defence, not simply what might be considered by the court to be a “reasonable” defence. Blair, J.A., writing for the panel, stated as follows at paras. 15 and 16:
A court may strike out portions of a pleading, even where the allegations are relevant, if the applicant can establish that they are of marginal probative value and their probative value is outweighed by their prejudicial effect. Before doing so, a judge must balance the rights of the parties on the particular facts of the case and must consider carefully the extent to which the particulars attacked are necessary to enable the defendant to prove its case and their probative value in establishing that case: see Clement v. McGuinty (2001), 2001 CanLII 7949 (ON CA), 18 C.P.C. (5th) 267 (Ont. C.A.) at paras. 21-24; Asper v. Lantos (2000), 2000 CanLII 29038 (ON SCDC), 51 O.R. (3d) 215 (Ont. Div. Ct.), at paras. 18-20; Lee v. Globe & Mail (The) (2001), 2001 CanLII 28035 (ON SC), 52 O.R. (3d) 652 (Ont. S.C.J.), at paras. 11 and 14. Where the allegations in question are relevant and material, however, the court should exercise this power with considerable caution, in my view.
Pleadings are not the appropriate stage in an action to engage at large in what is essentially a trial judge's exercise for determining the admissibility of evidence at trial — i.e., weighing the probative value versus prejudice of facts. That exercise is not particularly well-suited to defining issues for trial, something which is for the parties to decide. Rule 25.11 provides that the pleading may be struck if it "may prejudice the fair trial of the action." A fair trial requires that the defendant be able to put forward a "full" defence, not — as the motion judge erroneously concluded — a "reasonable" defence defined in advance by the plaintiff and the court.
Position of the Plaintiff
14The plaintiff takes the following positions with respect to the impugned paragraphs in the Statement of Defence which are the subject of his motion:
(a) Paragraph 9:
The allegation of fact in paragraph 9 relates to an allegation made by Smith against the plaintiff prior to the defendant conducting her workplace investigation. The allegation in paragraph 9 does not relate to the statements of the defendant which the plaintiff has identified as being defamatory of him.
On her cross-examination on her affidavits filed in response to the motion, the defendant agreed that the plaintiff was only ever told that he was being investigated as result of identical letters he sent to two Lifeguard employees and also agreed that she never told the plaintiff that he was being investigated for anything else, including any allegations made by Smith.
The pleading at paragraph 9 is not relevant as it does not relate to the elements of the claim or the defence and are therefore irrelevant, argumentative, speculative. The plaintiff submits that paragraph 9 is particularly egregious as it is clearly inserted merely for colour and as an inflammatory attack on his integrity.
(b) Paragraph 20:
The issue with respect to non-payment of the defendant’s account in respect of her investigation and report only arose after the defendant had completed her investigation and published and shared her Report and Summary of Findings.
The defendant’s complaint of late payment is not being relied upon by the plaintiff on the questions of whether the defendant made defamatory statements or conducted a negligent investigation. In any event, the defendant has acknowledged on cross-examination that she was paid in full for her services.
The defendant also acknowledged on cross-examination that the temporary delay in payment of her account had nothing to do with how she carried out her investigation, the contents of her Report and Summary of Findings, who the Report and Summary of Findings were shared with, whether the contents of the Report and Summary of Findings were true, the conclusions of the defendant in the Report and the Summary of Findings, and the basis for those conclusions.
As such, the allegations in paragraph 20 are irrelevant and therefore scandalous, frivolous or vexatious.
(c) Paragraph 35:
On her cross-examination in response to the defendant’s motion to dismiss the action pursuant to s. 137.1 of the Courts of Justice Act (the “Anti-Slapp motion”) the defendant confirmed that the definition of domestic violence includes physical violence, that the plaintiff was not physically violent, that the definition of domestic violence include sexual intimidation, and that the plaintiff did not engage in sexual intimidation.
The defendant confirmed on cross-examination in response to the present motion that she did not intend to accuse the plaintiff of having committed violence or sexual violence against Smith or having engaged in sexual intimidation.
Accordingly, paragraph 35, which pleads that the plaintiff acted consistently with the three defamatory comments referred to in the Amended Statement of Claim does not coincide with her evidence on cross-examination.
Even if there is any probative value to the evidence led in relation to paragraph 9, 20 and 35, it is outweighed by its prejudicial effect and such evidence would add to the length and complexity of the trial.
Position of the Defendant
(a) Position of the defendant with respect to whether any of the impugned paragraphs are scandalous, frivolous or vexatious
15The defendant submits that paragraph 9 of the Statement of Defence is directly relevant the plaintiff’s causes of action in negligence and defamation on the following bases:
(a) Smith’s allegation that the plaintiff threatened to “take her down financially” supports the “Three Comments” including that there is ample evidence to support the claim that the plaintiff is trying to undermine and destroy the Lifeguard business and Smith personally;
(b) paragraph 9 is material to determining if the defendant breached the standard of care or if the “Three Comments” are defensible by justification and/or fair comment;
(c) the paragraph is relevant to the plaintiff’s claim for loss of reputation as a result of a devaluation of Lifeguard due to the defendant’s alleged negligence;
(d) the paragraph is also relevant to the plaintiff’s claims for punitive and exemplary damages. Relying upon the Court of Appeal decision in BMO Nesbitt Burns Inc. v. Wellington West Capital Inc., (2005) 2005 CanLII 30303 (ON CA), 77 O.R. (3d) 161 (C.A.) at paras. 21-32, the plaintiff’s conduct is relevant to its punitive damages claim where there is a causal connection between the plaintiff’s conduct and the defendant’s conduct;
16The defendant submits that paragraph 20 of the Statement of Defence is relevant to the plaintiff’s claim for damages in negligence resulting from the alleged a devaluation of Lifeguard. The plaintiff, as President of Lifeguard, repeatedly refused to make a payment to the defendant as a service provider which represents an alternate cause for any devaluation of Lifeguard.
17The defendant submits that paragraph 35 is also relevant to the plaintiff’s claim for damages for loss of his reputation and resulting from the devaluation of Lifeguard, as the paragraphs identify alternate causes for those damages. If any of the recipients, all of whom worked with the plaintiff at Lifeguard, misinterpreted the defendant’s report as meaning that the plaintiff’s pattern of behaviour to gain control over others included physical violence or sexual intimidation, the defendant is entitled to argue that the plaintiff caused this misunderstanding or that the defendants ought not to be responsible for damages as a result.
Position of the defendant as to whether any of the impugned paragraphs may prejudice or delay the fair trial of the action
18The defendant submits that the impugned paragraphs are of central relevance to her defences to defamation and to the allegation that she breached the standard of care, to her allegation that any loss suffered by the plaintiff was not caused by her, and to the quantum of any damages suffered by the plaintiff.
19The defendant says that the plaintiff has failed to establish that the impugned paragraphs are of marginal probative value and are outweighed by their prejudicial effect. The investigation carried out by the defendant concerned conduct that had already occurred, including the fact described in paragraph 9 which was specifically cited in the Report.
20Paragraph 20 is relevant to causation or damages and in particular, that the plaintiff’s refusal to allow Lifeguard to pay its bills caused or contributed to the devaluation of Lifeguard.
21The defendant submits that paragraph 35 does not conclude that the plaintiff was found to have been physically violent or to have engaged in sexual intimidation but merely that the defendant’s findings supported the allegation that he engaged in a pattern of behaviour in the workplace to gain power and control over someone who he had an intimate relationship with. Paragraph 35 relates to the defendant’s position that the plaintiff caused or contributed to any loss of reputation related to any alleged “insinuation” or otherwise or any devaluation of Lifeguard.
22The defendant says that the plaintiff has failed to establish that the probative value of the impugned paragraphs is outweighed by its prejudicial effect. The plaintiff has also failed to demonstrate that the impugned paragraphs will greatly expand the length, complexity, breadth and scope of the trial. The determination of whether the defendant had a reasonable basis for the contents of the Report, as well as the quantum of any loss caused by the defendant, would remain within the scope of the trial even if the impugned paragraphs were to be struck.
Analysis
(a) Paragraph 9
23As indicated above, the focus is on whether the allegation in the impugned paragraph is relevant to a cause of action or defence.
24Paciocco and Stuesser, at page 30 of The Law of Evidence (rev. 5th ed.), state that "[e]vidence is relevant where it has some tendency as a matter of logic and human experience to make the proposition for which it is advanced more likely than the proposition would appear to be in the absence of that evidence."
25The plaintiff has alleged that the statement in the defendant’s Report that the plaintiff is “deliberately trying to undermine and destroy the Lifeguard business, staff and [Smith] personally” is defamatory and would cause a rightminded person to think less of him. In my view, the defendant’s pleading at para 9 that Smith alleged that the plaintiff threatened to “take Smith down by breaking [Smith] personally” and that [Smith] would have to “work on her back” is relevant to the defences of justification and fair comment in reference to the alleged defamatory statement by having a tendency to make the proposition for which the evidence will be led, that is that the statement is true, more likely.
26As stated by Nordheimer, J. in Abdi Jama, rule 25.11 should be invoked to strike a pleading or portion thereof only in the clearest of cases. This is not among the clearest of cases in reference to paragraph 9.
(b) Paragraph 20
27Paragraph 20 of the Statement of Defence pleads that on December 4, 2019, the plaintiff refused to allow Lifeguard to pay the Defendant for her investigation. In my view, this allegation is not relevant to a cause of action or defence.
28I am unable to accept the defendant’s position that the allegation in paragraph 20 is relevant to the plaintiff’s claim that the defendant’s negligence caused Lifeguard to be devalued. It is not alleged that the plaintiff refused or neglected to agree to pay creditors of Lifeguard generally. In my view, evidence that the plaintiff refused to agree that Lifeguard pay the defendant, with whom he was in dispute, does not have some tendency as a matter of logic and human experience to make the proposition for which it is advanced, namely that Lifeguard’s “value” was adversely affected by the delay in payment occasioned by the plaintiff, more likely than the proposition would appear to be in the absence of that evidence. Lifeguard’s “value” would be determined by what an arm’s length purchaser, under no compulsion to buy, would pay for it. There is no basis to suggest an arm’s length purchaser would be deterred by the existence of a single disputed account of a service provider.
29I find that since it is not relevant to a claim or defence, paragraph 20 of the Statement of Claim is scandalous and should be struck.
(c) Paragraph 35
30Paragraph 35 alleges that the plaintiff has behaved in a manner consistent with the comments of the defendant alleged by the plaintiff to be defamatory and the plaintiff thereby caused or contributed to his losses.
31The plaintiff has alleged that the statements of the defendant which he has alleged were defamatory would cause a right-minded person to think less of him and that, as a result, he has suffered humiliation, embarrassment, a loss of standing with Lifeguard employees and injury to his reputation in the community.
32The meaning and effect which the recipients of defendant’s Report and Summary of Findings would reasonably place on the alleged defamatory statements have not been determined and will be issues for the finder of fact at trial. The question of whether the plaintiff’s behavior before, during and after the defendant’s investigation was consistent with the defendant’s allegedly defamatory comments will depend upon that finding.
33In my view, the allegation in paragraph 35 is relevant to the plaintiff’s claim that he has suffered damages for loss of reputation and standing among employees of Lifeguard and in the community. It has some tendency as a matter of logic and human experience to make the proposition for which it is advanced, namely that the plaintiff, by his own conduct, caused or contributed to his loss of reputation or standing, more likely than the proposition would appear to be in the absence of that evidence.
34In my view, paragraph 35 does not represent the clearest of cases to be struck pursuant to rule 25.11.
(d) Leave to Amend Paragraph 20
35The defendant, in her factum, requests leave to amend in the event that any of the impugned paragraphs is struck.
36In my view, it is difficult to see how paragraph 20, which alleges that the plaintiff refused to permit Lifeguard pay the defendant’s account, is capable of amendment to make it relevant to a claim or defence.
37Moreover, the Court of Appeal held in 1588444 Ontario Ltd. v. State Farm Fire and Casualty Co., 2017 ONCA 42 at para. 25 that where the impugned paragraphs were scandalous, frivolous or vexatious and disclosed no reasonable defence, a court is not required to grant leave to amend.
Disposition
38In accordance with the foregoing, it is ordered that
(a) paragraph 20 of the Statement of Defence shall be struck, without leave to amend; and
(b) the balance of the motion is dismissed.
Costs
39The parties are strongly urged to settle the issue of the costs of the motion.
40If the parties are unable to do so, the defendant may make written submissions as to the costs of the motion within 14 days of the release of this Endorsement. The plaintiff has 10 days after receipt of the plaintiff’s submissions to respond. The written submissions shall not exceed three (3) double-spaced pages exclusive of Bills of Costs or Costs Outlines, offers to settle and authorities. All such written submissions are to be forwarded to me via email to the Trial Coordinator at Brantford, at the same email address as was utilized for the release of this Endorsement.
41If the parties are able to settle the question of costs or if a party does not intend to deliver submissions on costs, counsel are requested to advise the court accordingly.
D.A. Broad, J.
Date: August 3, 2021