ONCA Slapps Down a Framework for Dismissing Strategic Lawsuits

by Michael Cremasco | Nov 21, 2018

On August 30, 2018, the Ontario Court of Appeal released its decision in 1704604 Ontario Ltd. v. Pointes Protection Association, 2018 ONCA 0685, the first appellate-level decision to consider the effect of the additions of sections 137.1 – 137.5 to the Courts of Justice Act (“CJA”)  spurred by the Protection of Public Participation Act (“PPPA”) enacted in 2015. Concurrently with 5 other appeals, the ONCA laid down the framework it will consider when analyzing cases brought under those sections of the CJA.

A SLAPP (Strategic Lawsuit Against Public Participation) is an action brought by a person or organization with the underlying purpose to silence, dissuade, or otherwise “gag” critics who have expressed themselves on a matter of public interest. Faced with the burden of what could be exorbitant legal costs, not to mention the weight of simply being named in a lawsuit, those critics are effectively muzzled. SLAPPs also unduly deter the public from the liberties afforded to them in a democratic society.

In an effort to curb SLAPP lawsuits, the Ontario legislature introduced the PPPA, which in turn provided a quick and cost-effective avenue under the CJA for defendants of such lawsuits to move for a dismissal order.

Of course, the fact that a legal action may have a chilling effect discouraging discussions of public interest does not necessarily mean that this should prevent the action from proceeding. In enacting the PPPA, the legislature recognized that the protection afforded to the public should not be used as a shield for expression that has wrongfully harmed the business, reputational or personal interest of others.

In the case at hand, the defendant Pointes Protection Association (“Pointes”) and individual members of its executive committee brought a motion under section 137.1 of the CJA to dismiss an action brought against them by 1704604 Ontario Ltd. (“170 Ontario”) for breach of contract. 170 Ontario alleged in its lawsuit that Pointes had breached the terms of a Settlement Agreement when one of the defendants gave evidence in a proceeding before the Ontario Municipal Board. 170 Ontario alleged that the Settlement Agreement prohibited the defendants from providing that evidence.

The motions judge dismissed the defendant’s motion. That decision was appealed to the ONCA pursuant to section 6(1)(d) of the CJA.

In upholding the appeal, Justice Doherty for the Court of Appeal embarked in an effort to clarify the legal analysis that must be undertaken when considering if a claim will be dismissed under these sections of the CJA.

The Threshold Requirement: Section 137.1(3)

Under section 137.1(3), the first step is for the defendant to prove on a balance of probabilities that the proceeding arises from an expression made by the person that relates to a matter of public interest. Determining if the expression “relates to a matter of public interest” is an open one as “public interest” is not defined under the legislation.

The Court indicated that it would need to objectively determine if the matter is related to public interest, “having regard to the context in which the expression was made and the entirety of the relevant communication.”

There is no exhaustive list as to what may be considered “public interest”, but this is different from matters which the public is “merely curious or has a prurient interest”. The merits, method or motive of the author is irrelevant at the threshold stage.

The Merits-Based Hurdle: Section 137.1(4)(a)

If the Court is satisfied that an expression was made and it relates to  matter of public interest, the burden then shifts to the plaintiff.

The plaintiff must then establish on a balance of probabilities that there are grounds to believe that (i) the proceeding has substantial merit and (ii) the defendant has no valid defence.

Determining if the proceeding has merit does not involve putting a “best foot forward” that one would expect in motions for summary judgment. Given s. 137 motions must be heard within 60 days, the records used on the motion will necessarily be limited. It is on the basis of what will likely be such a limited record that the motions judge must decide if the claim has more than just “some chance of success”, but “is shown to be legally tenable and supported by evidence, which could lead a reasonable trier to conclude that the claim has a real chance of success.”

The plaintiff must also satisfy that motion judge that there are reasonable grounds to believe the defence put forth by the defendant is not valid. This means that the plaintiff needs to establish that there are reasonable grounds to believe that none of the defences advanced could succeed.

The Public Interest Hurdle: Section 137.1(4)(b)

Assuming the plaintiff has met the merits-based hurdles in 137.1(4)(a), the Court then goes on to what Justice Doherty considered the “heart” of the legislation. The plaintiff must satisfy the Court that the harmed caused or likely to be caused to them is “sufficiently serious” that the public interest in protecting the defendant’s expression is outweighed by the public interest in allowing the claim to proceed. This, the Court noted, will be primarily measured by the monetary damages suffered or likely to be suffered as a result of the expression. This also extends in certain circumstances, however, to the preservation of a person’s reputation and personal privacy

The plaintiff cannot at this stage simply rely on bald allegations in the statement of claim relating to damages. They must put forth some sort of evidence that damage was sustained as a result of the impugned expression, and that the damage and the expression are casually linked.

This will be balanced against the general “importance of freedom of expression, especially on matters of public interest, both to the individual and to the community.” Here, unlike at the threshold stage, the quality and motivation of the speaker are relevant factors.

If the plaintiff is able to satisfy the public-interest hurdle, the claim will not be dismissed.

Decision and Going Forward

Having regard to the above, Justice Doherty held that there was no reasonable prospect that 170 Ontario “could convince a reasonable trier that there was substantial merit to its claim that the Agreement” precluded the defendant from testifying before the Ontario Municipal Board, and that therefore it did not meet the merits test under s. 137(4)(a)(i). Further, there was no evidence of any harm for the purposes of s. 137.1(4)(b), and was outweighed by the public interest in the testimony. The motion Judge’s decision was reversed, and Pointes motion to dismiss the claim was granted.

With the assistance of the Ontario Court of Appeal, we now have the framework for a legal analysis under Ontario’s Anti-SLAPP legislation. The Court has provided an explanation of what practical realities both a plaintiff and defendant need to come to terms with when either bringing or defending a motion under section 137 of the CJA. At the very least, the foundation for future Anti-SLAPP motions has been set and going forward, it will be interesting to see how this framework is utilized by the Court to strike a balance between the public interest and freedom of expression on one hand, and the ability for persons and organizations to sue for alleged wrongs caused to them on the other.