



COURT OF APPEAL FOR ONTARIO

CITATION: Bondfield Construction Company Limited v. The Globe
    and Mail Inc., 2019 ONCA 166

DATE: 20190304

DOCKET: C65318

Doherty, Pardu and Nordheimer JJ.A.

BETWEEN

Bondfield Construction Company Limited

Responding Party (Appellant)

and

The
    Globe and Mail Inc., Phillip Crawley, Sylvia Stead,

Greg McArthur, Robyn
    Doolittle and Karen Howlett

Moving Parties (Respondents)

Kevin OBrien and Karin Sachar, for the appellant

Carlos Martins and Andrew MacDonald, for the respondents

Heard: February 13, 2019

On appeal from the order of Justice E.M. Morgan of the
    Superior Court of Justice, dated March 28, 2018, with reasons reported at 2018
    ONSC 1880, and from the costs order of Justice E.M. Morgan dated May 29, 2018,
    with reasons reported at 2018 ONSC 3347.

Doherty J.A.:

I.        OVERVIEW

[1]

The respondents (referred to collectively as the Globe) published a
    series of articles between September 2015 and February 2016 about the
    appellants (Bondfield) successful bid on a $300 million contract to build a
    new critical care facility at St. Michaels Hospital in Toronto (SMH). Among
    other things, the articles addressed the connection between Bondfield and its
    president John Aquino and Vas Georgiou, a senior executive at SMH who was on
    the committee that awarded the construction contract to Bondfield. Bondfield
    sued the Globe for $125 million, asserting that the Globes articles falsely
    alleged a corrupt connection between Mr. Aquino and Mr. Georgiou that
    had played a role in Bondfield obtaining the contract.

[2]

The Globe defended on the basis that the articles were not defamatory
    but rather focused on Mr. Georgious checkered past, and the undisclosed
    conflict of interest in the bidding process flowing from Mr. Georgious and Mr.
    Aquinos common business interests. The Globe also advanced various defences
    including fair comment and responsible communication.

[3]

The Globe brought a motion under s. 137.1 of the
Courts of Justice
    Act
, R.S.O. 1990, c. C.43, to dismiss Bondfields action claiming that the
    lawsuit was brought to silence the Globe on matters of significant public
    importance. The motion judge allowed the Globes motion, dismissed the action
    and awarded the Globe costs on a substantial indemnity basis fixed at $500,000.

[4]

Bondfield appeals. Bondfields primary argument rests on the submission
    that the motion judge misinterpreted the provisions in s. 137.1, and in
    particular, s. 137.1(4)(a)(ii). Bondfield submits that this court, in a
    series of decisions released after the motion judge released his reasons, has
    interpreted s. 137.1 in a fundamentally different way than did the motion
    judge. Bondfield argues that on a correct interpretation of s. 137.1, the
    Globes motion to dismiss Bondfields action should have failed.

[5]

The Globe accepts that certain passages in the motion judges reasons
    are inconsistent with this courts subsequent interpretation of s. 137.1. The
    Globe argues, however, that the motion judges application of s. 137.1 to the
    facts as he found them is consistent with this courts approach. Alternatively,
    the Globe urges this court to perform its own s. 137.1 analysis. The Globe
    submits that applying the section as this court has interpreted it leads to the
    dismissal of Bondfields action.

II.       THE MOTION JUDGES ANALYSIS

[6]

On the s. 137.1 motion, the Globe had to satisfy the motion judge that
    the articles in issue related to a matter of public interest (s. 137.1(3)). If
    the Globe met that onus, the onus shifted to Bondfield to establish three
    things on the balance of probabilities:

·

There were grounds to believe that the claim had substantial
    merit (s. 137.1(4)(a)(i))

·

There were grounds to believe that the Globe did not have a valid
    defence (s. 137.1(4)(a)(ii))

·

The harm suffered or likely to be suffered by Bondfield as a
    result of the articles was sufficiently serious that the public interest in
    allowing the lawsuit to continue outweighed the public interest in protecting
    the Globes freedom of expression (s. 137.1(4)(b))

[7]

The motion judge described the subject matter of the challenged articles
    as the operation of the procurement process in respect of the contract to build
    the critical care facility at SMH. That contract involved the expenditure of a
    very large amount of public money: para. 34-35. The motion judge characterized
    the topic as a matter of public interest. The parties accept that finding. The
    Globe met its onus under s. 137.1(3).

[8]

The motion judge then turned to the merits inquiry required under
    s. 137.1(4)(a). He first considered whether Bondfield had satisfied him
    that its claim had substantial merit. The motion judge considered the competing
    interpretations of the articles that had been advanced by Bondfield and the
    Globe. He said, at para. 42:

[T]he average Globe reader would almost inevitably conclude
    that Georgiou was a fraudster who undermined the fairness and integrity of the
    SMH procurement process.
The reader
    would further conclude that Bondfield had won its bid as a result of its
    relationship and collusion with Georgiou
.
[Emphasis
    added.]

[9]

The motion judge had little difficulty based on the meaning he ascribed
    to the articles in concluding that Bondfield had provided grounds to believe
    that it could make out the elements of a defamation claim. In other words,
    there was reason to believe that Bondfields claim had substantial merit. Bondfield
    cleared the hurdle in s. 137.1(4)(a)(i). This aspect of the motion judges
    ruling is not challenged on appeal.

[10]

The
    motion judges analysis of the no valid defence requirement in
    s. 137.1(4)(a)(ii) is in issue on the appeal. The motion judge explained
    his interpretation of that subsection at para. 46:

What is clear is that there cannot be an arguable point on the
    defence side. That is, a defense that could go either way 
i.e.
one that could potentially apply but
    it is not clear at this stage whether or not it will actually succeed  does
    not meet the statutory criterion of no valid defence to the proceeding. [Citation
    omitted.]
In order to meet the [s.
    137.1(4)(a)(ii)] criterion, Bondfield must establish that the Globe has no
    valid defence whatsoever
.
[Emphasis added.]

[11]

The
    motion judge proceeded to accurately and clearly set out the elements of the
    fair comment defence. He then said, at para. 56:

It is therefore evident at this stage of the action that the
    Globe has a potentially valid defence of fair comment. I reiterate that this
    finding is not that the defence is successful such as might be made at the
    conclusion of a trial or summary judgment motion. Rather, it is a finding made
    at an early stage of the action and within the terms of s. 137.1(4)(a)(ii) of
    the
CJA
that a valid defence potentially exists. On the state of the
    record before me, there is no reason to conclude that the defence of fair
    comment is unavailable to the Globe or that the defence cannot succeed.

[12]

If
    the above passages left any doubt about the motion judges interpretation of
    the no valid defence provision, the trial judges comments near the end of
    his reasons when discussing the effect of his interpretation of s. 137.1 remove
    that doubt. He said, at para. 89:

In requiring an otherwise serious and meritorious claim to be
    dismissed because at this stage a potential defence cannot be eliminated, s.
    137.1 of the
CJA
risks tipping the balance further in the publishers
    favor than the anti-SLAPP policy requires.

[13]

The
    motion judge recognized that his finding that Bondfield had not cleared the no
    valid defence hurdle in s. 137.1(4)(a)(ii) necessitated the dismissal of
    Bondfields claim. He went on, however, to consider s. 137.1(4)(b). He
    ultimately concluded that the balancing of public interests identified in that clause
    favoured proceeding with Bondfields claim.

III.      DID
    THE MOTION JUDGE ERR IN HIS INTERPRETATION OF THE NO VALID DEFENCE PROVISION?

[14]

The
    motion judge did not have the benefit of this courts reasons in
1704604
    Ontario Ltd. v. Pointes Protection Association
, 2018 ONCA 685, 142 O.R.
    (3d) 161, and related cases. His interpretation of s. 137.1(4)(a)(ii) has been
    overtaken by those cases. As explained in
Pointes
,
at para. 84:

The onus rests on the plaintiff to convince the motion judge
    that, looking at the motion record through the reasonableness lens, a trier
    could conclude that none of the defences advanced would succeed.

[15]

The
    motion judge placed the onus on Bondfield to show that the Globe has no valid
    defence whatsoever. As explained in
Pointes
, s. 137.1(4)(a)(ii)
    imposes a significantly less onerous burden on Bondfield. Bondfield was
    required to show that a reasonable trier could conclude that the Globe did not
    have a valid defence. Bondfield would meet that onus if it showed that a
    reasonable trier could reject all of the various defences put in play by the
    Globe. A determination that a defence could go either way in the sense that a
    reasonable trier could accept it or reject it is a finding that a reasonable
    trier could reject the defence. That is as far as Bondfield had to go to meet
    its onus under s. 137.1(4)(a)(ii). The motion judge erred in law in holding
    that Bondfield was required to show that the Globe had no valid defence. Bondfield
    was only required to show that a reasonable trier could reject the defences advanced
    by the Globe.

[16]

On
    my reading of the motion judges reasons, had he had the benefit of the
    analysis in
Pointes
, he would have found that Bondfield had met its
    onus to show grounds to believe that the Globe had no valid defence. The motion
    judge accepted that the Globe had a potentially valid defence of fair comment.
    However, he also accepted that Bondfield had a serious and meritorious claim.
    The motion judge saw this as a case that could go either way.

[17]

My
    assessment of the record arrives at the same conclusion. The Globe advanced at
    least two defences, fair comment and responsible communication, that could
    reasonably be accepted by a trier. However, the ultimate success of those
    defences depended on whether the trier would make certain findings. For
    example, in respect of the fair comment defence, a reasonable trier could view
    the statements suggesting corruption and collusion in the bidding process as
    factual assertions or as statements of opinion. If the trier characterized them
    as the former, the fair comment defence would not succeed. If the trier
    characterized them as statements of opinion, the defence could well succeed. In
    short, there was a reasonable prospect that the Globes fair comment defence
    could succeed or could fail. That was enough to get Bondfield past
    s. 137.1(4)(a)(ii).

[18]

In
    respect of the responsible communication defence, the Globe was required to
    show first that the subject matter of the publications was of public interest,
    and second, that the publication was responsible, in the sense that reasonable
    steps were taken to ensure the overall fairness of the publication and the
    accuracy of any factual assertions in the publication:
Grant v. Torstar
    Corp.
, 2009 SCC 61, [2009] 3 S.C.R. 640, at para. 98;
Armstrong v.
    Corus Entertainment Inc.
, 2018 ONCA 689, 143 O.R. (3d) 54, at para. 28. On
    my review of the record, both the overall fairness of the Globes articles and
    the reasonableness of the steps taken to validate the accuracy of any factual
    assertions in the articles are open to legitimate dispute. A trier could
    reasonably find for or against the Globe on these issues. Bondfield established
    grounds to believe that the responsible communication defence would fail.

[19]

I
    would hold that Bondfield met its onus under s. 137.1(4)(a)(ii) to show grounds
    to believe that a reasonable trier could conclude that the Globe did not have a
    valid defence.  Bondfield cleared both merits hurdles in s. 137.1(4)(a).

IV.     SHOULD
    THE CLAIM HAVE BEEN DISMISSED ON THE PUBLIC INTEREST BALANCING IN S.
    137.1(4)(b)?

[20]

As
    indicated above, the motion judge considered the application of
    s. 137.1(4)(b) although on his analysis it was unnecessary to do so as he
    had determined that Bondfields action must be dismissed pursuant to s.
    137.1(4)(a)(ii). The motion judge found that the public interest balancing in
    s. 137.1(4)(b) favoured permitting Bondfield to proceed with its action. Several
    of the factors identified by the motion judge were subsequently acknowledged by
    this court in
Pointes
and related cases to be relevant to the
    balancing process in s. 137.1(4)(b): see
Pointes
,

at paras. 85-95;
Able
    Translations Ltd. v. Express International Translations Inc.
, 2018 ONCA
    690, at paras. 37-44.

[21]

Normally
    a deferential standard of review will apply to a motion judges analysis of the
    competing public interests in s. 137.1(4)(b):
Pointes
,
at para. 97. However, given that the
    motion judge did not have the benefit of this courts subsequent decisions, I
    will engage in a
de novo
balancing of the competing public interests. I
    come to the same conclusion as did the motion judge.

[22]

In
Platnick v. Bent
, 2018 ONCA 687, at para. 98, this court suggested
    that the public interest balancing in s. 137.1(4)(b) could begin with the
    question Does this claim have the hallmarks of a classic SLAPP? This
    litigation has none of those hallmarks.

[23]

There
    is no history of Bondfield using litigation or the threat of litigation to
    silence critics. There is no financial or other power imbalance that favours
    Bondfield over the Globe. There is no suggestion of any punitive or retributory
    purpose motivating Bondfields lawsuit:
Platnick v. Bent
,
at para. 99.

[24]

Nor
    is this a case in which Bondfield has failed to produce any evidence of loss in
    the form of monetary damages. To the contrary, Bondfield has produced evidence
    that it has lost contracts, potential construction partners, and potential
    funding from lenders as a result of the articles written in the Globe. These
    losses, if connected in whole or in part to any defamatory statements, would
    result in a significant damage award in favour of Bondfield.

[25]

I
    hasten to add that the Globe has a good argument that any losses suffered by
    Bondfield are not causally connected to the alleged defamation but are, in
    fact, the result of Bondfields failure to abide by the rules pertaining to the
    bidding process and, in particular, its failure to disclose in the course of that
    process its business connections with Mr. Georgiou. In my view, however, the s.
    137.1 motion was not the place to resolve the causal connection issue as it
    related to the alleged damages. For the purposes of asserting harm suffered or
    likely to be suffered, it was enough that Bondfield presented specific and
    credible evidence of potentially significant pecuniary damages flowing from the
    defamatory statements:
Pointes
,
at para. 90-92. Like the motion judge, I think Bondfield made out a formidable
    case of significant harm suffered or likely to be suffered as a result of the
    articles should they be found to be defamatory.

[26]

There
    is, however, much to be said for the public interest in protecting the Globes
    freedom of expression. The articles dealt in considerable depth with the
    integrity of the contract bidding process on a project that involved millions
    of dollars in public funds. The community clearly has a significant interest in
    that subject. By engaging in a lengthy and no doubt expensive investigation,
    the Globe was able to shine considerable public light on that process and raise
    legitimate concerns about the process. There is a very real public benefit to
    this kind of investigative reporting.

[27]

Whatever
    may ultimately be determined about the quality of the Globes investigation and
    the fairness of the reporting, there is nothing in this record that could
    reasonably suggest that the Globe was motivated by anything other than a desire
    to inform the public about the facts the Globes investigation had revealed. Similarly,
    the Globes articles are devoid of deliberate falsehoods, hyperbole, gratuitous
    personal attacks, or other similar characteristics that would diminish the
    public interest in protecting the expression:
Pointes
,
at para. 94.

[28]

There
    are powerful arguments to be made on both sides of the public interest
    balancing required in s. 137.1(4)(b). In the end, I view this as a case in
    which Bondfield has a legitimate argument that it has been defamed and suffered
    significant damages as a result of the Globe articles. The Globe has legitimate
    arguments, both that the content is not defamatory and that it has defences to
    any parts that are defamatory. Unlike SLAPP suits which reek of the plaintiffs
    improper motives, claims of phantom harm, and bullying tactics, this litigation
    smells of a genuine controversy. It should be tried on its merits.

V.      THE APPLICATIONS FOR LEAVE TO APPEAL COSTS

[29]

Both
    sides sought leave to appeal the costs order made by the motion judge.  
    As I would allow the main appeal, the costs order made by the motion judge
    falls. There is no need to address the applications for leave to appeal costs.

VI.     CONCLUSION

[30]

For
    the reasons set out above, I would allow the appeal, set aside the dismissal of
    the action and remit the matter to the Superior Court.

[31]

The
    parties may provide submissions of five pages or less in respect of the costs
    of the motion and the costs of the appeal. They should exchange those
    submissions and file them with the court by March 21, 2019.

Released:  MAR -4 2019                            Doherty
    J.A.

DD                                                            I
    agree G. Pardu J.A.

I
    agree I.V.B. Nordheimer J.A.


