2006BCSC1748

Before: The Honourable Madam Justice Gerow

Reasons for Judgment

Counsel for the Plaintiffs:	R.D. McConchie A. McConchie
Counsel for the Defendant, Jon Newton:	D.W. Burnett
Date and Place of Hearing:	September 25, 2006
	Vancouver, B.C.

[1] Nikki Hemming is suing the defendants for libel and defamation as a result of a posting and a story on an internet site. Ms. Hemming alleges that Mr. Newton defamed her by publishing false and malicious works about her conduct and character on a website located at http://www.p2pnet.net (the “P2P website”) on and after May 1, 2006. On this application, Ms. Hemming seeks to strike out portions of the amended statement of defence pursuant to Rule 19(24) of the Rules of Court.

[2] Mr. Newton apparently has control over the P2P website. The P2P website publishes stories and articles about developments in the P2P and digital arenas. P2P is an acronym for peer-to-peer and refers to file sharing between a group of people over the internet by access to each others computer hard drives.

[3] Kazaa is a peer-to-peer file sharing application owned by Sharman Networks Limited. Ms. Hemming is the chief executive officer of Sharman. Kazaa is commonly used to exchange music files over the internet, however it can also be used to exchange other file types such as videos, applications, and documents.

[4] The posting and the story on the P2P website arose out of Ms. Hemming’s involvement with Sharman and Kazaa, and some court proceedings in Australia. The author of the posting is unknown, but Mr. Newton is the author of the story. Mr. Newton pleads a number of defences in his amended statement of defence, including the defences of innocent dissemination, honest comment on a matter of public interest, namely the court proceedings in Australia, abuse of process, and qualified privilege. As well, Mr. Newton pleads that the posting and the story are protected under s. 2(b) of the Charter.

[5] Ms. Hemming takes issue with the manner in which the amended statement of defence is drafted in terms of its organization, its use of lettered paragraphs as opposed to numbered paragraphs, and its content. She says that much of the amended statement of defence offends the rules of pleadings which are particular to defamation cases.

ANALYSIS

[6] A statement of defence in a defamation action must state expressly and plainly the defences being raised. Affirmative defences must be specifically alleged, and a general denial is insufficient. The defendant cannot just make general pleas of defences, but must provide particulars in order that the plaintiff knows what defences are raised and what particulars the defences are based on. Defences may be pled in the alternative: Raymond E. Brown, The Law of Defamation in Canada, 2nd ed., looseleaf (Scarborough: Carswell, 1999) vol. 3 at 19-67 [Brown].

[7] In a motion for striking out pleadings under Rule 19(24), the court proceeds on the assumption that all the facts pled are true, and the only question is whether they disclose a cause of action or defence: McNaughton v. Baker (1988), 25 B.C.L.R. (2d) 17 (C.A.).

[8] Rule 19(24) provides that:

At any stage of a proceeding the court may order to be struck out or amended the whole or any part of an endorsement, pleading, petition or other document on the ground that

(a) it discloses no reasonable claim or defence as the case may be,

(b) it is unnecessary, scandalous, frivolous or vexatious,

(d) it is otherwise an abuse of the process of the court,

and the court may grant judgment or order the proceeding to be stayed or dismissed and may order the costs of the application to be paid as special costs.

[9] Pleadings will not be struck unless it is plain and obvious that the plea discloses no reasonable claim or defence. Only if the defence or action is sure to fail because it contains a radical defect should the relevant portions of the statement of defence be struck out. Considerations include: (a) whether there is a question fit to be tried regardless of the complexity or novelty; (b) whether the outcome of the claim at trial is beyond a reasonable doubt; (c) whether serious questions of law or questions of general importance are raised or if facts should be known before rights are decided; (d) whether the pleadings might be amended; and (e) whether there is an element of abuse of process: Hunt v. Carrey Canada Inc., [1990] 2 S.C.R. 959.

[10] At the hearing, counsel indicated that Ms. Hemming was not seeking to strike out the amended statement of defence, but rather to excise improper pleas in the expectation that recognized defences will be pled. In my view, much of what Ms. Hemming is seeking are particulars. As such, it would have been preferable if a demand for particulars had been served prior to this application; however, I understand that has not been done.

[11] In this case, Ms. Hemming says the fact that the paragraphs of the amended statement of defence are not numbered is confusing. She argues that the wording of Rule 19(5), “A pleading shall be divided into paragraphs numbered consecutively, each allegation being contained in a separate paragraph”, mandates that the paragraphs be numbered.

[12] The amended statement of defence is divided into numbered paragraphs; however, paragraphs 7 and 8 contain a number of subparagraphs, identified by either letters or roman numerals. In my view, the fact that some of the allegations are contained in paragraphs that are lettered consecutively, rather than numbered consecutively, is not a basis to strike the pleadings.

Paragraph 6

[13] Ms. Hemming seeks to strike out the defence that Mr. Newton was an innocent disseminator of the posting. The defence of innocent dissemination is recognized in Canadian law, and has been applied in circumstances where the defendant was not the originator of the alleged defamation but simply someone who facilitated its public dissemination without being aware of the content: Menear v. Miguna (1996), 30 O.R. (3d) 602 (O.C.J. Gen. Div.); Slack v. Ad-Rite Associates Ltd. (1998), 79 O.T.C. 46 (O.C.J. Gen. Div.).

[14] Ms. Hemming asserts that Mr. Newton has not pled the material facts necessary to disclose the defence of innocent misrepresentation because he does not set out how the posting was done without negligence on his part. However, the amended statement of defence alleges that Mr. Newton was an innocent disseminator as “he did not see or authorize the Posting before it occurred and removed it in good faith upon receipt of Hemming’s complaint.” In my view, Mr. Newton has pled sufficient facts to enable Ms. Hemming to know why he contends he was an innocent disseminator; i.e. he did not see or authorize the posting before it occurred.

[15] Ms. Hemming goes further and asserts that it would be an abuse of process for the defence to stand because Mr. Newton authored the story the same day as the posting and the story referred to the posting. Ms. Hemming relies on Godfrey v. Demon Internet Limited, [1999] EWHC QB 244 for the proposition that because Mr. Newton knew of the posting the same day it is plain and obvious that the defence of innocent misrepresentation will not succeed. However, in Godfrey the plaintiff was only claiming damages for libel in respect of the posting after the defendant had knowledge of it, whereas in this case Mr. Newton alleges he did not have knowledge of the posting, in that he did not see or authorize the posting, before it occurred. This is not the sort of defence that could be or should be disposed of on a pleadings application as there are issues of fact that have to be determined: Menear, supra. Assuming the facts pled are true, it is not plain and obvious that the defence will fail.

Paragraph 7 b)

[16] Ms. Hemming seeks to strike out the words “in the context of other information posted on p2pnet.net and publicly available through other online and traditional media, was to the extent of their factual content” in paragraph 7 b) of the amended statement of defence on the basis that it is a vague and ambiguous statement.

[17] Paragraph 7 b) states: “The Posting and Story, in the context of other information posted on p2pnet.net and publicly available through other online and traditional media, was to the extent of their factual content, a fair report of court proceedings in Australia, protected by s. 3 of the Libel and Slander Act or alternatively the common law. These court proceedings included the following: …” Paragraph 7 b) then has subparagraphs i – vii which set out particulars of the court proceedings Mr. Newton alleges Ms. Hemming was involved in.

[18] Ms. Hemming asserts that this wording is ambiguous and not informative about what Mr. Newton is intending to prove at trial and, therefore, is calculated to embarrass and/or delay the fair trial of this action.

[19] The definition of embarrassing pleadings adopted by the courts is that the allegations are so irrelevant that to allow them to stand would involve useless expense and involve the parties in a dispute which is unrelated to the matters in issue. In order for pleadings to be struck on this ground their irrelevancy must be apparent on the face of the pleadings: Keddie v. Dumas Hotels Ltd. (c.o.b. Cariboo Trail Hotel) (1985), 62 B.C.L.R. 145 (C.A.) at ¶ 7.

[20] Even if the ambiguities about what “other information posted on p2pnet.net and publicly available through other online and traditional media” was addressed through the provision of particulars, what others said is not relevant to the issues in this proceeding. Either the posting and/or the story were fair comment or they were not. Accordingly, I am of the opinion that it is plain and obvious that the phrase “in the context of other information posted on p2pnet.net and publicly available through other online and traditional media, was, to the extent of their factual content” is irrelevant and it is struck on that basis.

[21] Ms. Hemming also seeks to strike the words “protected by s. 3 of the Libel and Slander Act” from paragraph 7 b) of the amended statement of defence, on the basis that it does not plead the material facts necessary to disclose the defence of statutory privilege created by s. 3 of the Libel and Slander Act, R.S.B.C. 1996, c. 263.

[22] Section 3 provides:

(1) A fair and accurate report in a public newspaper or other periodical publication or in a broadcast of proceedings publicly heard before a court exercising judicial authority if published contemporaneously with the proceedings, is privileged.

(2) This section does not authorize the publication of blasphemous or indecent matter.

[23] Ms. Hemming says that Mr. Newton does not allege the material facts necessary to disclose that either the posting or the story was published in a public newspaper or other periodical, or that it was broadcast within the meaning of the Libel and Slander Act. Mr. Newton argues that when the provision was enacted it covered all of what was considered “media” at the time, and that today “media” includes the internet. He says a purposive interpretation would lead to a broad meaning which would encompass the internet. In Weiss v. Sawyer (2002), 61 O.R. (3d) 526 (C.A.) the court found that the word “paper” was broad enough to encompass a newspaper which is published on the internet.

[24] In my view, although novel, it is not plain and obvious that the defence will fail. As to the complaints that Mr. Newton did not specifically plead that the posting and story were an “accurate report” or “published contemporaneously”, those are matters which are capable of amendment. Mr. Newton has set out the citations for the court cases he is referring to in the subparagraphs along with dates and quotations from judgments. If Ms. Hemming requires further particulars, she can make a demand for the same.

[25] Ms. Hemming also complains that Mr. Newton has not pled the material facts necessary to raise the common law defence of privilege for persons publishing fair and accurate reports of judicial proceedings. However, as noted above, Mr. Newton refers to the court proceedings in Australia, and goes on to refer to the specific case and dates on which the hearings took place, as well as portions of judgments.

[26] Mr. Newton has agreed that the word “included” in the sentence “Those courts proceedings included the following” should be amended to “were”.

[27] Ms. Hemming asserts that paragraph 7 b) (vii) should be struck as an abuse of process of the court. Subparagraph 7 b) (vii) states: “In the cross examination of Hemming ordered as described above, similar allegations regarding Hemmings asset transactions were put to her”. That is a matter on which particulars can be sought.

Paragraph 7 c)

[28] Ms. Hemming seeks to strike paragraph 7 c) on the basis that it does not allege the material facts necessary to disclose the defence of fair comment. Paragraph 7 c) states: “The Posting and the Story consisted of honest comment on a matter of public interest, namely the litigation referred to above, and upon privileged matters, being the proceedings against Hemming in the Australian litigation.”

[29] Ms. Hemming says the defence requires Mr. Newton to prove that the words she complains of are: (1) recognizable by the ordinary person as comment, (2) on a matter of public interest, (3) based upon facts that are true or stated on a privileged occasion, and (4) made honestly and fairly.

[30] The objective limits of fairness are broad and the words should be viewed liberally. In considering a plea of fair comment, the question to be asked is whether the words in issue represent a fair expression of the real view of the person making the comment. The truth or falseness of the comments is not in issue, except insofar as there are defamatory statements of fact: Cherneskey v. Armadale Publishers Ltd., [1970] 1 S.C.R. 1067.

[31] Various textbook writers have commented on what is required in pleading the defence of fair comment:

· The pleading should set out the essential elements upon which the defence is founded;

· It may be a general plea, to the effect that the words were fair comment made in good faith and without malice upon a matter of public interest;

· The pleading should include particulars of the facts on which the defendant relies in support of his plea;

· The pleading should identify the passage in the publication which is fair comment; and

· It should contain an allegation that it was made on a matter of common interest.

Brown at 19-100-19-101; Patrick Milmo et al., eds., Gatley on Libel and Slander, 10th ed., (London: Sweet & Maxwell, 2004) at 852-854.

[32] In paragraph 7 c) Mr. Newton has not identified the portions of the posting or the story he is seeking to defend as fair comment. However, he has pled that the comments were made on a matter of public interest, namely the Australian litigation. The particulars of the Australian litigation are identified in paragraph 7 b), and paragraph 7 c) specifically refers to those particulars. In my view, the paragraph is capable of amendment to identify the words complained of in the posting and the story which Mr. Newton claims are fair comment. Given that the defence is capable of amendment, it is not plain and obvious that the defence will fail and, therefore, it is not appropriate to strike paragraph 7 c). I note that Ms. Hemming also complains that there are insufficient particulars of the Australian litigation beyond that set out in paragraph 7 b). She can seek the further particulars she requires through a demand for particulars.

Paragraph 7 e)

[33] Ms. Hemming seeks to strike paragraph 7 e) of the amended statement of defence on the basis that it is a vague conclusion of law. Paragraph 7 e) states: “The Posting and the Story consist of protected expression under the Canadian Charter of Rights and Freedoms, s. 2(b) and to the extent the traditional common law of defamation would impose liability upon this defendant for the posting, the law is to that extent of no force or effect.”

[34] Ms. Hemming asserts that the plea amounts to nothing more than a statement that the defendant should not be found liable. Mr. Newton says that interpretation is inaccurate, and that the pleading specifically raises s. 2(b) of the Charter and its clash with the limitations on freedom of expression implicit in the law of defamation.

[35] Mr. Newton argues that the common law is subject to modification in accordance with Charter values. He further argues that by definition, the imposition of civil liability for expression constitutes an infringement of s. 2(b) of the Charter. He asserts that the common law of defamation is invalid except to the extent that it can be justified under s. 1.

[36] Mr. Newton is in effect arguing that the law of defamation is contrary to the right to freedom of expression contained in s. 2(b) of the Charter. He wishes to argue that the American approach to the law of defamation should be adopted. However, a similar argument was made and rejected in Hill v. Church of Scientology of Toronto, [1995] 2 S.C.R. 1130. In Hill the Supreme Court of Canada considered the constitutionality of the common law action for defamation. The Court recognized that the common law should be interpreted in a manner which is consistent with Charter principles, but noted that a distinction is to be made between private litigants founding a cause of action on the Charter and judges exercising their inherent jurisdiction to develop the common law. Cory J., writing for the majority, concluded at ¶ 142 that the common law of defamation complies with the underlying values of the Charter and there was no need to amend or alter it.

[37] In Moises v. Canadian Newspaper Co. (c.o.b. Times-Colonist) (1996), 24 B.C.L.R. (3d) 211 (C.A.) the court, having reviewed Hill along with other authorities, stated at ¶ 61:

What emerges from the foregoing authorities is a justified unwillingness to hold that the common law of defamation is inconsistent with Charter values. Freedom of expression is of fundamental importance in Canada, but so is the dignity of the individual and his or her right to protect and preserve a good reputation.

[38] On the basis of the authorities, I have concluded that it is plain and obvious that the Charter defence Mr. Newton is attempting to advance in paragraph 7 e) is bound to fail, and the paragraph should be struck.

Paragraph 8

[39] Ms. Hemming complains that paragraphs 8 i), 8 ii), 8 v) and 8 viii) of the amended statement of defence require particulars. The fact that there are insufficient particulars is not a basis to strike the pleading under Rule 19(24). As noted earlier, no demand for particulars has been delivered. However, Mr. Newton agrees that paragraph 8 ix) should be struck.

Paragraph 9

[40] Ms. Hemming objects to paragraph 9 on the basis that it fails to plead the material facts necessary to disclose an abuse of process by Ms. Hemming in bringing this action. Paragraph 9 reads: “This proceeding is an abuse of the court’s process for the purpose of intimidating and harassing a critic of Hemming, her company and its software, such that the Court should not countenance the use of its processes in this manner but instead should condemn same with an award of increased costs against Hemming.”

[41] In Home Equity v. Crow, 2002 BCSC 1747 the requirements to establish an abuse of process are set out at ¶ 19:

a) the defendant has been subjected to a legal process by the plaintiff;

b) the predominant purpose of this is to further some indirect, collateral and improper purpose outside the ambit of the litigation;

c) some definite act or threat has been made in furtherance of that process; and

d) some actual damage has resulted.

[42] Mr. Newton argues that the abuse of process for the purpose of costs is not the same as an action founded in abuse of process, and that the court should consider Ms. Hemming’s motive in bringing the lawsuit when determining costs. He asserts that the issue of SLAPP suits, which is an acronym for “strategic lawsuits against public participation”, is a way in which a large and well funded litigant can silence critics through the threat and expense of defamation lawsuits.

[43] However, the intention to silence a defendant through a libel lawsuit is not, in and of itself, an improper purpose. As stated in Metropolitan Separate School Board v. Taylor (1994), 21 C.C.L.T. (2d) 316 (O.C.J. Gen. Div.) at ¶ 5:

Cases typically refer to the use of the judicial process as a threat or club to obtain a collateral advantage not involved in the process itself, such as the payment of money through extortion. Thus the act in furtherance must be something which the plaintiff is enabled to commit, or threatens to commit, because of the existence of the law suit, but lying outside its scope: see Teledata Communications Inc. v. Westburne Industrial Enterprises Ltd. (1990) 71 O.R. (2d) 466 at 469 (H.C.).

[44] Accordingly, the plea of abuse of process based on the fact that Ms. Hemming brought a libel lawsuit is bound to fail and the paragraph is struck.

CONCLUSION

[45] Paragraphs 7 e), 8 ix) and 9 of the amended statement of defence are struck. As well, the phrase in paragraph 7 b) “in the context of other information posted on p2pnet.net and publicly available through other online and traditional media, was, to the extent of their factual content” is struck. The word “included” in paragraph 4 is struck.

[46] The remainder of the relief sought in Ms. Hemming’s notice of motion is dismissed. Given the divided success, each party will bear their own costs.

“L. Gerow, J.”

The Honourable Madam Justice L. Gerow

Citation:	*Hemming v. Newton,*
	2006 BCSC 1748