Author: Dan

Ontario: Notice under the Libel and Slander Act

In J.K. v. The Korea Times & Hankookilbo Ltd. (The Korea Times Daily), the Court of Appeal held that a plaintiff will satisfy the notice provision in section 5(1) the Libel and Slander Act by giving notice which conveys the essence of the matter complained of so that the defendant can take appropriate steps to mitigate damages.

The decision contains a thorough summary of the section 5(1) jurisprudence:

[19]      A review of the authorities considering s. 5(1) of the Libel and Slander Act reveals the following principles:

i.   There is no prescribed form of notice. The notice must identify the “matter” complained of and need not describe the “statement” complained of or specify the exact words: Grossman, at pp. 501-502.

ii.     Notices need not contain the same level of particularity as a statement of claim:Canadian Union of Postal Workers v. Quebecor Media Inc., 2016 ONCA 206(CanLII), at para. 5; World Sikh Organization of Canada v. CBC/Radio Canada,2007 CarswellOnt 7649 (S.C.), at para.12.

iii.            The adequacy of the notice must be assessed in the light                   of its purpose: Shtaif v. Toronto Life Publishing Co.,            2013 ONCA 405 (CanLII),366 D.L.R. (4th) 82, at para. 57.

iv.    The purpose of the notice is to call the publisher’s attention to the alleged libellous matter, so that the publisher may investigate and, if it deems it appropriate, publish a retraction, correction, or apology. This will permit the publisher to reduce or eliminate any damages: Grossman, at p. 501; see alsoJanssen-Ortho Inc. v. Amgen Canada Inc.(2005), 2005 CanLII 19660 (ON CA),256 D.L.R. (4th) 407 (Ont. C.A.), at para. 38; Siddiqui v. Canadian Broadcasting Corp. (2000), 2000 CanLII 16920 (ON CA), 50 O.R. (3d) 607 (C.A.), at para. 16, leave to appeal refused (2001), 271 N.R. 196 (note) (S.C.C.); and Canadian Union of Postal Workers, at para. 6.

v.   The appropriate test for the sufficiency of the notice is whether the notice fairly brings home to the publisher the matter complained of to permit the publisher to review the matter and decide how to respond: Grossman, at pp. 504-505; see also Siddiqui, at para. 18; Canadian Union of Postal Workers, at para. 6;Gutowski v. Clayton, 2014 ONCA 921 (CanLII), 124 O.R. (3d) 185, at para. 36; and Shtaif at para. 58.

vi.   Courts can assess the adequacy of the notice in the light of all of the surrounding circumstances: Grossman, at p. 505; see e.g. Pringle v. Channel 11 Limited Partnership, 2015 ONSC 2699, at paras. 20-22; Boyer v. Toronto Life Publishing Co. (2000), 2000 CanLII 22369 (ON SC), 48 O.R. (3d) 383 (S.C.), at paras. 17-19.

vii.  A plaintiff may also benefit from the notice, because a timely correction, retraction, or apology may constitute a better remedy than damages:Grossman, at p. 501.

viii. There is a preference in the case law to have matters determined on the merits, rather than terminating them on technical grounds: see Grossman, at p. 505;Telegram Printing Co. v. Knott, [1917] 55 S.C.R. 631, 3 W.W.R. 335, at p. 342;Sentinel-Review Company Limited v. John R. Robinson, 1928 CanLII 9 (SCC),[1928] S.C.R. 258, at pp. 262-63; Pringle, at paras. 33-34; Boyer, at para. 19.

[20]      In summary, in considering the adequacy of a notice, the court must have regard to the purpose ofs. 5(1) and the circumstances of the particular case to determine whether it fairly alerts the publisher to the matter complained of, so that the publisher may take appropriate action.

[21]      In conducting this analysis, the court must be careful to ensure that the notice provision is not abused to shield publishers from legitimate defamation claims. Subsection 5(1) of the Libel and Slander Act was not enacted to reward publishers who are deliberately obtuse. Rather, it is designed to ensure that publishers have sufficient information to permit them to take appropriate steps to mitigate or to eliminate potential damages, if they choose to do so.

 

In the defendant’s Statement of Defence, it described the notice provision as a limitation period.  This provides a teachable moment: notice periods are not limitation periods.  Because notice periods and limitation periods have similar practical consequences, people tend to conflate them, and indeed in the Law of Limitations we treat notice provisions as if they are a subset of the law of limitations.

Justice Wilcox recently emphasised this point in Bourassa v Temiskaming Shores (City).  The plaintiff ventured a technical and rather dubious argument (of the kind that limitations issues seem to encourage): the notice provision in section 44(10) of the Municipal Act is of no force and effect because it is a limitation period, but not one listed in the schedule to s. 19 of the Limitations Act, which preserves certain former limitation periods in other acts.  Justice Wilcox followed appellate jurisprudence standing for the principle that notice periods are not limitation periods (see for example Bannon v. Thunder Bay (City) at para. 22), noted that none of the limitation periods listed in the section 19 schedule include notice periods, and concluded quite rightly that the plaintiff’s argument was baseless.

 

Ontario: interaction of the Insurance Act and Limitations Act

Justice Akhtar’s decision in Sorita v. TTC provides a helpful summary of the interaction between the Limitations Act and the statutory threshold in s. 267.5 of the Insurance Act:

[26]      As noted earlier, Ontario’s restriction on motor vehicle accident claims is contained in s. 267.5 of the Insurance Act, which provides:

(5) Despite any other Act and subject to subsection (6), the owner of an automobile, the occupants of an automobile and any person present at the incident are not liable in an action in Ontario for damages for non-pecuniary loss, including damages for non-pecuniary loss under clause 61(2)(e) of the Family Law Act, from bodily injury or death arising directly or indirectly from the use or operation of the automobile, unless as a result of the use or operation of the automobile the injured person has died or has sustained,

(a) permanent serious disfigurement; or

(b) permanent serious impairment of an important physical, mental or psychological function.

 [27]      Ontario’s no-fault insurance scheme means that, in the Insurance Act context, the limitation clock begins to run when the plaintiff becomes aware that their injuries constitute “permanent serious impairment”. To otherwise commence an action is futile, as no evidence would have been available of a qualifying injury: Peixeiro v. Haberman, 1997 CanLII 325 (SCC), [1997] 3 S.C.R. 549, at para. 32. Additionally, the plaintiff in a motor vehicle claim is not required to commence an action before they know that they have a “substantial chance” of success: Everding v. Skrijel, 2010 ONCA 437 (CanLII), 100 O.R. (3d) 641, at para. 11. The inquiry to be undertaken is “whether the prospective plaintiff knows enough facts on which to base an allegation of negligence against the defendant”: Lawless v. Anderson, 2011 ONCA 102 (CanLII), at para. 23.

Readers of Under The Limit will know not to rely on Lawless v. Anderson when considering the commencement of the limitation period.  Contrary to the above, the inquiry is not when the claimant knows enough facts on which to base an allegation of negligence, but when the claimant ought to have knowledge of the section 5 discovery criteria, including that a proceeding is an appropriate remedy.  It always bears repeating: the words “cause of action” do not appear in the Limitations Act.

Ontario: Court of Appeal upholds Brown v. Baum

The Court of Appeal has upheld Justice Mew’s decision in Brown v. Baum.  I wrote about it here.

Justice Mew found that section 5(1)(a)(iv) of the Limitations Act delayed the commencement of the limitation period for a medical malpractice claim until a proceeding became an appropriate remedy, and that a proceeding did not became an appropriate remedy during the defendant’s good faith efforts to achieve a medical solution to the underlying injury.  The appellants argued that Justice Mew erred by conflating a claim to a legal right with taking legal proceedings to pursue that right.

Justice Feldman rejected this rather strained argument:

[18]      The motion judge’s application of the subsection to the facts on this record was particularly apt: he concluded that because the doctor was continuing to treat his patient to try to fix the problems that arose from the initial surgery, that is, to eliminate her damage, it would not have been appropriate for the patient to sue the doctor then, because he might well have been successful in correcting the complications and improving the outcome of the original surgery. On the evidence of Dr. Brown, the specialist who provided Ms. Brown with a second opinion, by September 2010, Dr. Baum in fact was successful in ameliorating Ms. Brown’s damage.

The appellant also argued that Justice Mew gave the term “appropriate” in section 5(1)(a)(iv) an “evaluative gloss” rather than applying the meaning of “legally appropriate” given by Justice Sharpe in Markel.  Justice Feldman rejected this argument as well:

[19]      Second, the appellant submits that the motion judge gave the term “appropriate” an “evaluative gloss” rather than applying the meaning of “legally appropriate”, contrary to this court’s decision in Markel. Again I do not agree. The motion judge was entitled to conclude on the facts of the case that Ms. Brown did not know that bringing an action against her doctor would be an appropriate means to remedy the injuries and damage she sustained following her breast reduction surgery until June 16 2010, after Dr. Baum performed the last surgery.

[20]      Further, I am satisfied that the test in s. 5(1)(b) is met. A reasonable person in Ms. Brown’s circumstances would not consider it legally appropriate to sue her doctor while he was in the process of correcting his error and hopefully correcting or at least reducing her damage. Where the damages are minimized, the need for an action may be obviated.

Justice Feldman also offered the following observation about the factually specific nature of a section 5(1)(a)(iv) analyses:

[21]      I would also add this observation: the Markel case involved insurance transfer payments and considerations of the appropriateness of possibly delaying the commencement of legal action in order to negotiate a settlement. The considerations for when it is appropriate for a patient to delay suing her doctor when that doctor is continuing to treat her are quite different. I certainly agree with the motion judge that there are many factual issues that will influence the outcome. The fact that a number of recent cases (for example, Tremain v. Muir (Litigation guardian of), 2014 ONSC 185 (CanLII), Chelli-Greco v. Rizk, 2015 ONSC 6963 (CanLII), Novello v. Glick, 2016 ONSC 975 (CanLII), 2016 ONSC 975 (Div. Ct.), and Barry v. Pye, 2014 ONSC 1937 (CanLII)) have considered this very issue with different outcomes is a testament to this approach.

One noteworthy aspect of the decision is that Justice Feldman does not reference Justice Juriansz’s more recent explanation of section 5(1)(a)(iv) from Clarke v. Faust, which we wrote about here: “That provision requires, in my view, a person to have good reason to believe he or she has a legal claim for damages before knowing that commencing a proceeding would be an appropriate means to seek to remedy the injury, loss or damage.”  This may simply reflect that the Court heard the appeal before delivering Clarke.

Ontario: no limitation of catastrophic injury status determinations

In Machaj v. RBC General Insurance Company, the Court of Appeal adopted the Divisional Court decision in Do v. Guarantee Insurance Co., which stands for the proposition that the limitation period applies only to claims for specific benefits and not claims for a determination of catastrophic injury status.

Ontario: the discovery of solicitor’s negligence claims

Lausen v. Silverman is a well-reasoned decision from the Court of Appeal considering the discovery of a solicitor’s negligence claim.

The plaintiff was injured in a car accident.  She consulted the defendant solicitor, who commenced an action on her behalf against the other driver for damages.  At mediation, the plaintiff followed her solicitor’s advice and settled the tort claim.

The plaintiff continued to suffer from her injuries and asked her solicitor to assist in obtaining statutory accident benefits.  The solicitor asked for a further monetary retainer and their relationship ended.  The plaintiff consulted another a lawyer, and he obtained an psychiatric opinion that the plaintiff’s injuries met the “catastrophic” threshold under the accident benefits regulation.

Almost six years after the settlement of her tort claim, the plaintiff commenced an action against her first solicitor for breach of contract, negligence, and breach of fiduciary duty for advising her to accept an improvidently low settlement of the tort claim.

The defendant solicitor moved for summary judgment on the basis that the claim was statute-barred.  The motion judge framed the issue as whether the plaintiff’s claim was discoverable within two years of issuing her statement of claim.  She found that the plaintiff ought to have had the necessary knowledge at the time of the settlement to bring her claim.

Justice Feldman granted the plaintiff’s appeal.  The motion judge erred in her interpretation and application of section 5(1) of the Limitations Act.  The plaintiff did not have knowledge that she had a claim against the defendant until she learned about it from her current counsel based on the medical opinion he obtained.  The opinion was the first indication that the plaintiff’s injuries warranted more compensation than she had received from the settlement.

Whatever facts the plaintiff knew at the time of the settlement, the defendant also knew them, and they did not cause the defendant to consider that the plaintiff might have had a claim against her.  If the defendant considered that she had settled the tort action improvidently, the Rules of Professional Conduct obliged her to advise the plaintiff of the potential error and to notify LawPro.  Advice from a lawyer of an error or omission will in the normal course cause the client to discover the resulting claim against the lawyer, but there was no such advice in this instance.

Meanwhile, it was the plaintiff’s uncontradicted evidence that although she felt that the settlement was unfair after concluding it, she did not know that it was improvident or that she had a claim against her former lawyer until so advised by her new lawyer based on the expert report.  Justice Feldman found that this evidence rebutted the section 5(2) presumption that the plaintiff discovered her claim on the date of the events giving rise to it.

Following the Court of Appeal decision in Ferrara v. Lorenzetti, Justice Feldman found that a reasonable a person with the abilities and in the circumstances of the plaintiff would not have realized that she had a claim against the defendants when no one, including the defendant, indicated to her that the settlement might have been improvident.

Ontario: limiting oppressive golf clubs

Noble v. North Halton Golf and Country Club is noteworthy because it’s the first decision to apply the Court of Appeal analysis in Maurice v. Alles to a claim for continuing oppression.  It will also interest people curious about the internal politics of golf clubs.

This is Justice Belobaba’s limitations analysis:

[18]         The defendant says the action is time-barred because the plaintiff has been voicing his concerns and complaints for years at shareholder meetings and otherwise about his inability to sell his Class G share and was fully aware of ongoing developments. There was nothing “new”, says the defendant, in the May and August, 2015 share sale and pricing resolutions. The defendant says that any and all claims of oppression were discovered or discoverable well before June, 2013 – that is, more than two years prior to the commencement of this proceeding. The action is therefore time-barred and should be summarily dismissed.

[19]         I do not agree. As the Court of Appeal recently noted in Maurice v. Alles,[5] where there is an allegation of continuous oppression stretching over many years, any threatened or actual conduct that is oppressive or unfairly disregards the interests of any complainant can constitute a discrete claim of oppression. And if the action is commenced within two years of this “discrete claim of oppression” that is sufficient. Here is how the Court of Appeal put it:

A party that engages in a series of oppressive acts can always make the argument that it is all part of the same corporate malfeasance and that the limitation period begins to run with the discovery of the first oppressive act.  In analyzing that conduct, courts must have regard to the remedial nature of the oppression remedy and the fact that any threatened or actual conduct that is oppressive, or unfairly prejudicial to, or unfairly disregards the interests of any complainant can constitute a discrete claim of oppression.  The oppression remedy section of the OBCA is drafted in the broadest possible terms to respond to the broadest range of corporate malfeasance.[6]

[20]         In my view, even though the plaintiff has been writing letters of complaint and voicing his concerns for many years, the share sale and pricing resolutions in May, 2015 (and again in August, 2015) raised a new and discrete claim of oppression. Indeed, as the plaintiff, noted in his affidavit, the May share pricing resolutions were “the trigger” for his statement of claim.

[21]         The actions in May, 2015 and again in August, 2015 were the first time that the defendant decided to sell treasury shares at prices that were well below the $22,000 price that was paid for the McNally family shares in 2006 or the $32,000 book value price (let alone the price based on current land values.) These decisions reduced the capital of the non-golfing shareholders for the sole purpose of supporting the golfing shareholders and members. By reducing and redistributing shareholder equity, the defendant breached its duty, says the plaintiff, to be even-handed in its treatment of all shareholders and not to oppress the minority who did not play golf.

[22]         The discrete acts of alleged oppression occurred in May and August of 2015. The action was commenced on June 15, 2015. The action is obviously not time-barred. The defendant’s motion is dismissed.

Ontario: leave, nunc pro tunc

Justice Perell’s decision in Pennyfeather v. Timminco Limited considers a order nunc pro tunc in the context of a securities misrepresentation class action.  It’s the first case to apply the Supreme Court’s decision in Green to a plaintiff’s request for an order granting leave nunc pro tunc under the Securities Act.  It’s not particularly noteworthy from a limitations perspective, but will interest those practicing in the area.

Ontario: The limitation of continuing oppression claims

In Maurice v. Alles, the Court of Appeal confirmed that a claimant must commence an oppression remedy claim within two years of the discovery of the claim.  Conduct that is in furtherance of, or based on, earlier oppressive conduct is new oppressive conduct that gives rise to a new cause of action, and therefore a new “claim” within the meaning of the Limitations Act, and is subject to its own limitation period.

These are the material paragraphs:

[52]      A party that engages in a series of oppressive acts can always make the argument that it is all part of the same corporate malfeasance and that the limitation period begins to run with the discovery of the first oppressive act. In analyzing that conduct, courts must have regard to the remedial nature of the oppression remedy and the fact that any threatened or actual conduct that is oppressive, or unfairly prejudicial to, or unfairly disregards the interests of any complainant can constitute a discrete claim of oppression. The oppression remedy section of the OBCA is drafted in the broadest possible terms to respond to the broadest range of corporate malfeasance.

[53]      Where the motion judge erred was in failing to carefully scrutinize the respondents’ conduct to determine whether there were any discrete acts of oppression within the two-year period prior to the commencement of the cross-application.

This is all very sensible.  Discrete causes of action give rise to discrete “claims” within the meaning of the Limitations Act, and accordingly are subject to discrete limitation periods.

The problem with this decision is that it rejects a comprehensive limitations analysis (eg, whether there is a new “claim” within the meaning of the Limitations Act) in favour of a cause of action analysis.  Justice Hourigan states, in paragraph 48, “As previously mentioned, limitation periods begin when the cause of action arises, not when it is remedied”.

This is plainly wrong.  Limitation periods commence on discovery of a claim, and discovery is completely unconnected to the accrual of a cause of action.  The words “cause of action” do not appear in the Limitations Act, and it often happens that the basic limitation period commences before the claimant’s cause of action accrues.  The basic limitation period commences presumptively on the date of the events giving rise to the claim.  A cause of action, at least in tort, requires actionable conduct and damage; whenever the actionable conduct (the events giving rise to the claim) and the resulting damage occur on different dates, the limitation period commences presumptively before the claimant’s cause of action accrues.

It’s troubling that this aspect of the limitations scheme is consistently misunderstood by the Courts.  The effect is to undermine the scheme’s conceptual integrity, and bad law.

The other interesting aspect of the decision is the following paragraph:

[46]      The appellant had an obligation to commence a claim based on the respondents’ failure to produce the information regarding the share transaction within two years of his discovery that they would not produce it to him.  It is not open to this court, as was suggested by the appellant, to look behind his non-action and excuse it based on the fact that this was a family business or that he had a reasonable expectation that the information would eventually be produced. Such an approach would effectively mark the return of the special circumstances doctrine, which has no application under the current limitations regime.

It seems to me that the fact that a dispute arises within the context of a family business or that the claimant has a reasonable expectation that certain information will be produced is relevant to a section 5(1)(a)(iv) analysis under the Limitations Act.  Consider Justice Juriansz’s description of the section 5(1)(a)(iv) requirement in Clarke v. Faust: “That provision requires, in my view, a person to have good reason to believe he or she has a legal claim for damages before knowing that commencing a proceeding would be an appropriate means to seek to remedy the injury, loss or damage.”  Surly there is a persuasive argument that it may take longer for a person to have a good reason to believe she has a legal claim against a family member than against someone else.

 

 

Ontario: modified objective discovery

Justice Parfett’s decision in Fernandes v. Goveas is a textbook example of applying the modified objective test in a discovery analysis.

Section 5(1)(b) of the Limitations Act contains the test.  This provision asks when a reasonable person (the objective component) with the abilities and in the circumstances of the claimant (the modifying subjective component) first ought to have known of the discovery criteria in section 5(1)(a).

The facts in Fernandes were unusually sordid.  The plaintiff sued her sister for unpaid wages and damages for wrongful dismissal, leading Justice Parfett to observe “This case is a lesson in why family should not always be treated ‘like family’.  The Plaintiff in this case was misled, overworked and underpaid by her family.”

This is how Justice Parfett applied the test:

[16]           A reasonable person is defined at s. 5(1)(b) of the Limitations Act as someone ‘with the abilities and in the circumstances of the person with the claim’.  In this case, that means someone who

  •                  Was not born in Canada;
  •                  Spoke only minimal English;
  •                  Was living exclusively in the home of her employers and had little social interaction outside the family;
  •                  Trusted her employers implicitly given they were family;
  •                  Had a moderate education;
  •                  Was diagnosed as autistic and noted as having problems with speech and social interactions.

[…]

[21]           In my view […The Plaintiff’s] language, psychological and social limitations created a situation where the Plaintiff was unable to exercise due diligence in order to discover the state of her financial affairs until after she left the Defendant’s employ.