Date of Release:  September 26, 1996                  NO. C922035
                                               VANCOUVER REGISTRY

            IN THE SUPREME COURT OF BRITISH COLUMBIA

BETWEEN:                      )
                              )
PAUL E. BROWN                 )
                              )
               PLAINTIFF      )
                              )    REASONS FOR JUDGMENT
AND:                          )
                              )
ALAN E. COLE, RON OSTLER and  )
BENNETT, COLE ADJUSTERS LTD.  )
                              )    OF THE HONOURABLE
               DEFENDANTS     )
                              )
AND:                          )
                              )    MR. JUSTICE HOLMES
DAVID STACEY, MIKE TALBOT,    )
SHERRY BASSETT, SAMUEL CHO,   )
SHERRY RUSSELL, KEN GRANTHAM, )
GARY HOGAN, SEAN DOUGLAS, PAT )
BUGIEL and KEVIN McINTYRE     )
                              )
               THIRD PARTIES  )


Darrell W. Roberts, Q.C.                Counsel for the Plaintiff
and Barbara J. Curran

Richard R. Sugden, Q.C.               Counsel for the Defendants,
                                        Alan E. Cole and Bennett,
                                              Cole Adjusters Ltd.

Dwight C. Harbottle                    Counsel for the Defendant,
                                                       Ron Ostler

Richard B. Lindsay                   Counsel for the Third Party,
and John B. Arneson                                   Mike Talbot

Donald A. Farquhar, Q.C.             Counsel for the Third Party,
                                                       Gary Hogan

Robert C. Brun                       Counsel for the Third Party,
                                                   Sherry Bassett

Peter C.M. Freeman, Q.C.             Counsel for the Third Party,
and Vincent G. Critchley                             Ken GranthamHeard at Vancouver:

March 11 - 15, 1996, March 18 - 22, 1996, and April 1 - 3, 1996,
with written argument in respect of the Third Party claim against
Mike Talbot.



THE CLAIM



1         The plaintiff's action against the defendants is for
slander by the defendants Cole and Ostler and for republication of
the alleged slanders by others.  The plaintiff claims the defendant
Bennett, Cole Adjusters Ltd. is vicariously liable for the
defamations of its employees Cole and Ostler.

2         Several third party proceedings were commenced by the
defendants because of particulars of republications pleaded by the
plaintiff.  The defendants' third party claims sought contribution
for damages claimed by the plaintiff resulting from the third party
defamations.

3         Many of the third party actions were resolved by the
parties prior to trial.  The balance, save one, were resolved by
the parties and dismissed during the course of trial.  The only
third party proceeding remaining for adjudication is one commenced
by the defendants against Mike Talbot.THE PARTIES

4         The plaintiff Paul Brown ("Brown") was an insurance
adjuster, and the principal of Paul Brown & Associates Ltd., an
independent general insurance adjusting firm.

5         The defendant Alan E. Cole ("Cole") is an insurance
adjuster who at relevant times was president of the defendant
general insurance adjusting firm of Bennett, Cole Adjusters Ltd.
("Bennett Cole").  The defendant Ron Ostler ("Ostler") was at all
material times an investigator and insurance adjuster employed by
Bennett Cole in its Richmond office.

6         The several third parties, many of whom were witnesses at
trial, were employed in various capacities within the insurance
industry as independent general insurance adjusters or directly in
the claims hierarchy of an insurance company.

7         The plaintiff and defendants were competitors for claims
adjusting assignments in British Columbia, particularly the greater
Vancouver area.  They each received claims assignments from a few
of the significantly larger insurance companies in this market, and
competed for the work of others.  In the course of their work the
plaintiff and the personal defendants would interact with a
significant number of the same adjusters and insurance claims
personnel comprising the local insurance claims industry.

8         The plaintiff and the defendant Cole were high-profile
adjusters, each well known and respected in the industry.  Their
respective firms enjoyed a good reputation.  The plaintiff had,
prior to founding his own firm, considered employment with Bennett
Cole who had extended an offer of employment to him.

9         The plaintiff is a 42 year old single parent of teenaged
daughters.  His history has significance in understanding the
impact upon him of events bearing on this action.  He experienced
an unhappy childhood and left home and became self-supporting at a
young age.  He has described himself as having been a street child.
While working full-time to support himself he returned to school
and in 1970 completed his Grade 12 education at a Community College
in Toronto, Ontario.

10        The plaintiff also took some limited post-secondary
education, but did not obtain a degree.  In 1975 he became employed
as a trainee insurance adjuster in Toronto.  He worked
approximately four years with various insurance adjusting firms in
Ontario.

11        The plaintiff married in 1971 and had two daughters.  He
and his wife separated in 1979 and the children remained with his
wife until 1982 when he took over their custody when his wife had
a nervous breakdown and was diagnosed as being schizophrenic.

12        In 1971 the plaintiff was convicted of possession of a
narcotic and given a conditional discharge.  In 1979 he was
convicted of trafficking in cocaine and received a nine month jail
sentence.  He received a Pardon for both of these offences in 1991.

13        In 1979 the plaintiff joined Morden & Helwig, a large
national adjusting firm.  He worked for them at different locations
and moved to their Vancouver office in 1981.  The plaintiff was
extremely good at his trade and by the mid-1980's was earning in a
range of $60,000 to $75,000 annually; upper levels of income for
employed adjusters.

14        In September 1987, after considering association with
other insurance adjusting firms, including the defendant firm of
Bennett Cole, he started his own firm.  He opened an office in
Vancouver and his business prospered and grew rapidly.  He opened
two branch offices: one in Coquitlam in October of 1989; the second
in Langley in November 1991.

15        The plaintiff worked very hard in establishing, operating
and expanding his firm.  His business, personal, and social life
were significantly intertwined.  Virtually all his social life was
with persons employed in the insurance claims and related industry.
His friends mostly numbered from amongst his clients.

16        At this high point of his professional and financial
success the plaintiff alleges the defendants slandered him, and
their slanders, combined with widespread republication of the
defamations within the insurance community, caused him extreme
mental distress leading to a depressive condition resulting in the
loss of his business and an inability to continue as an insurance
adjuster.

17        The evidence indicates persons working in the insurance
claims industry comprise a relatively close-knit and competitive
community.  There is a good deal of personal interaction amongst
those involved in the industry either in meeting personally or by
telephone.  The evidence of several of the witnesses was that
rumours travel quickly and extensively in that environment.

THE SLANDERS

18        The defendant Ostler is alleged to have slandered the
plaintiff on several occasions and to have been the instigator of
defamatory rumours which, through republication by others, rapidly
spread throughout the insurance claims community.

19        The original occasion of slander is alleged to have
occurred in January or early February 1992 during a telephone
conversation between Ostler and Corporal Didyck of the Burnaby
R.C.M.P. detachment.  Cpl. Didyck had received a Crime Stoppers tip
concerning the present location of $100,000 worth of fire sprinkler
heads earlier stolen in a 1990 burglary from a company called
Wescott Sales.  Cpl. Didyck had re-opened the R.C.M.P. burglary
investigation file on the theft.  When reviewing it he noted the
absence of a copy of Proof of Loss or property schedules that would
provide a description of the stolen goods.  There was a letter on
file from the plaintiff advising his firm acted for the insurer of
the stolen goods and requested he be advised of any recovery made.
Cpl. Didyck called the plaintiff and requested a copy of the Proof
of Loss documents.

20        Within a few days of receiving the Crime Stoppers tip
Cpl. Didyck telephoned the defendant Ostler to see if he might have
information or contacts as to persons who might be involved in
"fencing" the stolen fire sprinkler heads.  Ostler had in the past
provided him with useful information regarding investigation of
stolen goods or "fencing" of stolen goods.

21         Ostler was not in his office when he telephoned.  He
left a message to have him call.  Cpl. Didyck believes he did not
tell the person taking the message any detail as to why he was
calling Ostler nor suggest a need for urgency in reply.  He simply
left his name and number with a request Ostler personally return
his call.

22        His call was returned by Ostler the same day.  Ostler
told him he was at the Law Courts attending to a matter concerning
his divorce.  Cpl. Didyck explained the reason for his call and
Ostler immediately asked the name of the adjuster on the loss.
Cpl. Didyck said it was Paul Brown & Associates.  Ostler asked if
he knew Paul Brown, then quickly told him:

          -    Paul Brown's insurance industry
               [sic] was failing;

          -    Brown had a condominium in Mexico
               and enticed clients there using
               alcohol, drugs and women;

          -    Brown had a criminal record for
               trafficking narcotics and somehow
               had obtained a Pardon;

          -    Brown was known to have received
               kickbacks or gratuities in relation
               to his adjusting work;

          -    Brown might be importing marijuana
               into the country; and,

          -    the police should take a good look
               at him because he [Ostler] was
               unable to understand how Brown could
               maintain his life-style considering
               his business was going downhill.

23        This outburst took Cpl. Didyck quite by surprise.
Ostler's comments were neither expected, solicited, nor responsive
to his inquiry.  He had not requested any information on Brown nor
was his investigation concerned with Brown in any way.  He only
wanted to know if Ostler might know of persons who might deal in
stolen fire sprinkler heads Ä an unusual commodity for theft.

24        Cpl. Didyck advised Ostler none of what he told him about
the plaintiff was of interest to him.  He said if he had
information regarding Brown dealing in drugs he should contact the
drug squad, give information concerning kickbacks or taking
gratuities regarding insurance losses to the Insurance Crime
Prevention Bureau ("I.C.P.B."), and report any matter of fraud to
the Commercial Crime Unit or the fraud squad.

25        Cpl. Didyck was adamant he asked Ostler only if he had
any information or leads regarding the "fencing" of fire sprinkler
heads.  He did not ask him to embark upon an investigation of any
type, and specifically did not instruct or suggest any
investigation of Brown.

26        Cpl. Didyck a few days after the call to Ostler made a
further request of Brown for the Proof of Loss documents as he had
not received them.  The documents were faxed later on the day of
that request.

27        Cpl. Didyck recalls he received a call from the plaintiff
a week or ten days after speaking with Ostler.  The plaintiff was
irate.  In essence the plaintiff accused Cpl. Didyck of being the
origin of rumours about the plaintiff being circulated by Ostler.
The rumours were about Brown being involved with drugs and a fraud
relating to a burglary loss adjustment.  Cpl. Didyck denied he was
the source of any rumour.  He said he was not investigating him for
any reason and he had not given Ostler any information the
plaintiff complained of.

28        Cpl. Didyck did however decide not to tell Brown what
Ostler had said about him.  Brown tape recorded this call to Cpl.
Didyck and the transcript of the call is Exhibit 5.  The plaintiff
requested Cpl. Didyck call Dan Lemieux of the I.C.P.B. to confirm
he was not investigating him.  Cpl. Didyck did as requested.

29        Cpl. Didyck wrote a narrative of his recollection of
these events June 5, 1992 (Exhibit 4) at the request of his
superior officer.  The request was obviously occasioned because of
an inquiry from the plaintiff's solicitor.  The matter was
perceived to be serious and it was likely Cpl. Didyck would be an
important witness in anticipated litigation concerning the
allegation of defamation.

30        The evidence of Ostler as to the conversation in issue is
widely divergent from that of Corporal Didyck.  Ostler relies upon
the evidence read in by counsel for the plaintiff from the
transcript of Ostler's examination for discovery as supplemented by
Ostler's trial evidence.

31        Ostler's evidence is he received notification of Cpl.
Didyck's call in the form of a written telephone message (Exhibit
1, Tab 1; original Exhibit 1A).  The message form contained a
notation his help was required on a $100,000 plumbing loss, Paul
Brown was the adjuster, and the matter was urgent.  That message
was written by the receptionist, Arlene Bennett, who testified she
obtained that information from what Cpl. Didyck said to her in his
call.

32        Ostler's evidence is when he returned the call Cpl.
Didyck asked him for information about Brown.  He replied he could
not do so as he did not know Brown.  He said he told Cpl. Didyck he
would make an inquiry of someone who did know him.

33        Ostler said he then phoned Gord Mathison, an adjuster
employed by the defendant Bennett Cole at a different branch
office, and asked him to contact Cpl. Didyck about the plaintiff.
Ostler said during his call with Mathison he made notes on the
reverse of the phone message (Exhibit 1A).  Those notes are to the
effect Mathison told him during the call of the details of Brown's
conviction and sentencing for a possession of a narcotic offence
(March 23, 1971, conditional discharge) and for trafficking a
narcotic (1977, nine months).

34        Ostler said Mathison called him later and said he had
spoken to Cpl. Didyck and answered his questions.  In this
conversation Mathison told him Constable LeClair was assisting Cpl.
Didyck in the investigation.  Ostler said he then wrote LeClair's
name with a different pen on the side of the message.

35        The gist of Ostler's evidence is he did not make the
alleged slanderous remarks, or any of them, alleged by Cpl. Didyck.
Information as to Brown's record for narcotics possession,
trafficking and Pardon, if conveyed to Cpl. Didyck must have come
from Gord Mathison.  Ostler's evidence was Mathison appeared to
have that information memorized as he was able to relate it without
pause during their conversation.

36        Mathison was not called to give evidence at trial by any
party.

37        Ostler testified the reason Cpl. Didyck called him was to
ask for help in identifying the stolen goods as those from the
burglary loss if they were recovered.  Ostler said he had provided
that type of assistance to Cpl. Didyck in a previous matter.

38        Cpl. Didyck said he received the name of Ross Stenmark,
an employee of the plaintiff from Ostler during their
conversation.  Ostler denies he could have given Cpl. Didyck that
name because he didn't know Stenmark.  Ostler said Cpl. Didyck told
him the name of the insurance company involved in the plumbing loss
started with a "G", disagreed with Ostler's guess of the
"Guardian", but agreed it could be the "General Accident".

39        Cpl. Didyck said he did not know the name of the insurer,
and nothing in the police file gave the insurer's name.  In fact
the name of the insurer was apparently CIGNA.

40        Ostler first testified he did not have the phone message
before him when he called Didyck.  Later he said he could not
recall if he had the message before him or not when he called.

41        Ostler said he learned of Cpl. Didyck's call from Ms.
Bennett when he phoned the office for messages.  He then called
Cpl. Didyck and didn't reach him.  He later called him from home.
He recalls writing "Dennis" (Didyck's first name) on the message
while waiting for him on the phone.

42        Ostler said his divorce was concluded later in 1991 so he
would not have been calling from the Law Courts while attending to
a matter in the divorce proceeding as Cpl. Didyck testified.

43        Ostler does agree Cpl. Didyck did not ask him to make any
inquiries; and did not say Brown was under investigation by the
R.C.M.P.; or the I.C.P.B.  He also agrees Cpl. Didyck did not say
there was any suggestion or suspicion of fraud on the part of Brown
in respect of the loss.  He also agrees they had no conversation
about "salvage".

44        The evidence of John Burke is germane when considering
issues arising from the disparate evidence of Cpl. Didyck and
Ostler.  John Burke was also an employed adjuster of the defendant
Bennett Cole.  He worked out of the Surrey office, as did Gord
Mathison.

45        Burke was once a member of the R.C.M.P.  He attended
U.B.C. from 1983 to 1985 but left in 1985 to work as an adjuster
with I.C.B.C. until 1987.  He then worked two years with
Underwriters Claims Service and in late 1989 or early 1990 started
work with Bennett Cole.

46        Burke testified that within a day or two of February 2,
1992 (a date he recalls because of certain events occurring in
relation to an important file he worked on) Ostler came to the
Surrey office of Bennett Cole and initiated a conversation
concerning the plaintiff being the subject of an investigation by
Burnaby or Vancouver R.C.M.P for fraud.

47        Burke testified he usually placed little credence in what
Ostler said but recalled this conversation because Ostler said Cpl.
Didyck was involved in the investigation.  Burke knew Cpl. Didyck
from serving with the R.C.M.P. and respected his work as a police
officer.  He recalls Ostler said there was an ongoing investigation
into the theft of heavy equipment, or equipment removed following
a fire and the selling of the equipment and retaining the proceeds
of the salvage as a personal benefit.

48        Burke's evidence is that Ostler told him he was acting on
behalf of the police, as an agent, to do an investigation.

49        Immediately following this conversation Burke saw Ostler
sitting in Gord Mathison's office talking to him.  After work that
day Burke and Mathison went to a nearby pub for a drink.  Mathison
at that time repeated exactly the same story that Ostler had told
him about the plaintiff.  He recalls telling Mathison he considered
Ostler's story was "bullshit".

50        Burke said he was previously aware Brown had a past
criminal record involving drugs.  He heard those rumours when he
was working at Underwriters.

51        Some aspects of the evidence of Cpl. Didyck are probably
incorrect.  He may well have mentioned the name "Paul Brown" in
leaving Arlene Bennett the message to have Ostler call.  The
evidence suggests Ms. Bennett, being both a skilled receptionist
and a licensed adjuster, had asked questions to elicit certain
information usually required from a caller to trace a file.  Cpl.
Didyck when asked what the matter was about, who the insured or
insurer was, and if she could help, may well have given the name of
the adjuster Paul Brown because he didn't know the insurer's name.
It is also reasonable he may have said Ms. Bennett couldn't help,
and he needed the help of Ostler personally.

52        I do accept Cpl. Didyck's evidence concerning the
slanderous remarks of the plaintiff being made to him by the
defendant Ostler.  I do not believe he would be mistaken about such
a matter.  It would be most unlikely he would confuse whether it
was Ostler or Gord Mathison with whom he spoke.

53        I do not believe Cpl. Didyck has motive to deceive the
court.  I accept him as being a truthful witness.  I find his
evidence taken in the context of all the relevant evidence to be
more credible than that of Ostler.  Cpl. Didyck made his notes
within a few months of the incident.  His telephone call with the
plaintiff was tape recorded.  I find his notes and the call
transcript consistent with the evidence given at trial.  The
contents of the police file did not apparently disclose any
significant discrepancy in Cpl. Didyck's evidence.

54        In contrast I find the defendant Ostler lacking
credibility.  His explanation Cpl. Didyck was consulting him to
help identify the stolen goods which might be recovered does not in
context make sense.  I do not accept the tenor of Ostler's evidence
that it must be Gord Mathison who gave Cpl. Didyck the defamation
information.

55        I accept the evidence of Burke that Ostler separately
told him and Mathison that he had been asked to investigate the
matter on behalf of the police.

56        I also accept that Ostler was not truthful with his
employer, the defendant Cole, to whom he implied Cpl. Didyck had
suggested Brown knew the insured, and that the firm of Bennett Cole
might be retained by the insurer in the matter.

57        The statement by Ostler to Cpl. Didyck that Brown

... may be importing marijuana into the
country and that the police should look --
take a good look at him because he [Ron
Ostler] couldn't understand how Paul Brown was
maintaining his life-style the way he was
considering that his business was going
downhill.

is clearly a slander imputing criminality to the plaintiff.  It is
a type of defamation that is actionable per se:

Where a defamatory statement is made orally or
in a transitory form, its publication is
considered a slander, and the plaintiff must
plead and prove special damages unless the
words are actionable per se because they
accuse persons of unfitness in the way of
their work or trade, charge them with a
criminal offence, impute to them a loathsome
or contagious disease or, in the case of a
woman, impute to her unchastity.

[Brown, The Law of Defamation in Canada, 2nd
ed. (1994) p.15].

58        The allegations were serious, exceedingly so in the case
of the plaintiff because of his unfortunate past criminal record
for drug trafficking about which he felt having obtained a Pardon
was well in his past.

59        The defamation was also serious as it was made to a peace
officer, a person charged with the responsibility, and capability,
to act on such information to the detriment of the plaintiff's good
reputation.

60        When the plaintiff obtained a Pardon in 1991 he believed
that would prevent his past criminal conduct marring his present
and future business success.  The statement to Cpl. Didyck
therefore, as to his criminal record and that he had "... somehow
obtained a Pardon ..." although true, when coupled with and in
context with the slanderous statement as to the plaintiff importing
drugs and suggesting he was supporting his life-style on crime
heightens the gravity of the defamation and bespeaks malice.


If one libels another falsely alleging that a
person has been guilty of a crime, this might
not be so serious because the person libelled
can come into Court and if the charge is
false, his character is vindicated.  If,
however, as under the circumstances in this
case, the charge as to the conviction is true
and has been raised without justification for
the sole purpose of destroying the person's
character in an endeavour to prevent that
person from carrying on his livelihood in his
chosen occupation, it is indeed a serious
matter.

[Twaites v. Dominion Tax Systems Ltd. and
Stephens, [1950] 2 D.L.R. 513 at p.515
(B.C.S.C.)].

61        It is also of significance that Ostler has never
effectively apologized for his conduct and continues to deny that
he ever made the defamatory statements alleged.

62        Ostler's defamatory statements clearly slandered the
plaintiff in the "... way of (his) work or trade ..." as an
insurance adjuster and principal of his own insurance adjusting
firm.  Ostler told Cpl. Didyck "... Brown's insurance industry
(sic) was failing, was suffering ..." and that he had a condominium
in Mexico "... that he was luring or enticing clients to ... and
providing them with liquor, drugs and women."  He also "... alluded
to Paul Brown as having been known to receive kickbacks or
gratuities in return for some adjustments he has undertaken."

63        What Burke testified Ostler told him in early February
1992 when he came to his office in Surrey could be taken as a
variation on the theme of the plaintiff having "... been known to
receive kickbacks or gratuities in return for some adjustments he
has undertaken."  Burke's evidence, which I accept was that:

Q    Well, before we can put the judgment
     on it of being preposterous or
     whatever, can you tell us precisely
     what it was Mr. Ostler said?

A    Mr. Ostler stated that there was an
     investigation ongoing into the theft
     or removal of some heavy equipment
     or machinery from a factory there or
     store that had been involved in a
     fire in either Burnaby or East
     Vancouver.

Q    Yes?

A    From what I recall, it involved the
     removal of this equipment, the
     selling of the equipment and the --
     basically receiving the proceeds
     from the selling of the salvage as a
     personal benefit.

Q    Who receiving?

A    Mr. Brown.

Q    Did he say anything as to his
     involvement in the investigation?

A    As I recall, he stated that he was
     acting on behalf of the police as a,
     I suppose as an agent.

Q    To do what?

A    Some investigation.

[Exam. in Chief, Mr. Burke, p.8, l.36 to p.9,
l.39].

64        Ostler denies he said this to Burke, or even that he had
a conversation with him concerning the matter.  For the reasons
previously given I do not accept that denial as credible.

65        The defendant Cole testified that in mid-January of 1992,
in a telephone conversation Ostler told him "... there was an
investigation by the R.C.M.P regarding some pipes or sprinklers or
something ... and they believed Paul Brown was the adjuster and it
was a G.A. (General Accident) claim.  Ostler said he had been asked
to supply some information.  Cole said he told Ostler "That it was
nothing to do with us and nothing to do with him" and that he
should forget it and "... I [Cole] would take care of it."

66        Cole also recalls Ostler saying the R.C.M.P. wanted him
"... to look further into it ...".  In that conversation Ostler
also suggested that he had been told that Paul Brown may know the
insured.

67        Cole's evidence is at variance to that of Ostler
regarding the conversation.  Ostler recalls speaking to Cole
personally while at the office in Vancouver.  Cole recalls hearing
of the matter in a telephone call.

68        Ostler, in his examination for discovery of April 6,
1993, said that in speaking to Cole about the call from Cpl.
Didyck:

... I said to him that I had been approached
by the Mounties in Burnaby regarding a
$100,000 plumbing loss where Paul Brown was
the adjuster, that they asked me questions
about Paul which I was unable to answer them
because I didn't know him and that I -- we --
it had been left that I would do nothing until
we heard from the involved claims manager with
an assignment. [Q137].

69        This would bear the implication the R.C.M.P. were
investigating Brown.

70        Ostler denies he told Cole he was asked to look further
into the matter.  I note Ostler did not say he told Cole he had
referred the R.C.M.P. to Gord Mathison, another Bennett Cole
employee, who on Ostler's testimony had answered all their
questions.

71        Where differences exist between the evidence of Cole and
Ostler, I prefer the evidence of Cole.  I find him the more
reliable and credible witness of the two.

72        A further difference arises from the evidence of Cole and
Dan Millar, claims manager of the General Accident, as to what Cole
told him about the matter.  General Accident was one of Bennett
Cole's best clients, accounting for up to twenty percent of their
business.  Cole was also aware that Millar was a personal friend of
the plaintiff who was a competitor for General Accident claims
assignments.  Cole tried to lunch with Millar every two weeks.

73        Cole and Millar lunched January 29, 1992.  Bennett Cole
was opening new offices in Prince George and Kelowna and Cole
wished to discuss the prospect of new business for those offices.
Cole recalls this luncheon was about a week or two after Ostler had
reported to him the approach of the R.C.M.P.

74        The evidence of Mr. Millar is at the lunch meeting Cole
told him in a "by-the-by" manner that two of his employees had been
asked to investigate on behalf of the I.C.P.B. a matter concerning
improprieties in respect of salvage on one of Brown's files
concerning a large tool loss.  Millar understood the impropriety to
be on the part of Brown.

75        The evidence of Cole is he told Millar of Ostler
reporting the R.C.M.P. had contacted him regarding an investigation
of some valves or pipes or sprinklers valued at approximately
$100,000, Paul Brown was the adjuster on the loss, Brown might know
the insured, and that the R.C.M.P. wished Ostler to look further
into it.

76        Cole agreed upon cross examination that it was the
possibility Brown might know the insured that was the key factor in
his decision that Millar should be told of the matter.

77        Cole denies he told Millar that two of his employees had
been asked to look into the matter, or that it was the I.C.P.B. who
were investigating.

78        Millar attempted subsequently to confirm what he heard
from Cole by speaking with two Bennett Cole employees, Burke and
Ostler.  Millar asked Burke "... if it was true Bennett Cole was
investigating the competition".  Burke's response was that he
didn't want to get into that matter.  Millar's evidence was that
when he asked Ostler the same question Ostler answered "yes" and
reluctantly gave the initials of the adjuster involved as "P.B.",
and said if he required further information to contact Cpl. Didyck.

79        Ostler denies he told Millar Bennett Cole were
investigating the competition but does recall Millar questioning
him about the matter to the point he felt he was "... being set
up..." and he did give Millar the initials "P.B." as the adjuster
involved in the loss being investigated by the R.C.M.P.

80        There would appear to be no motive on the part of Mr.
Millar to misquote what he was told by Cole at the lunch meeting.
His memory may of course be imperfect, and he might be mistaken.
Millar however was surprised by the information from Cole as it
involved his very good friend Brown, and it suggested to him the
possibility of an impropriety in respect of a file of his company.
I do not believe he would be mistaken as to important details of
what he was told, namely that two Bennett Cole employees had been
asked to investigate, and that the investigating organization was
the I.C.P.B.

81        I accept the evidence of Millar as to his conversations
with Cole and Ostler where there are material differences in their
evidence.

82        The evidence of whether Cole spoke briefly to Dan Lemieux
of the I.C.P.B. before or after his luncheon with Millar also bears
upon the issue of what was on Cole's mind when he spoke with
Millar.  Cole believes he spoke to Lemieux January 23, 1992 at an
insurance company cocktail party at the Georgia Hotel.  Lemieux
recalls the conversation occurring in the rotunda of the Vancouver
Club as he was leaving an insurance industry reception.  He doesn't
recall the date.  Cole said he asked Lemieux if he was conducting
any investigation into a file where Paul Brown was the adjuster,
and Lemieux replied he "... had heard some things".

83        Lemieux testified that he recalls Cole approaching him as
he was leaving a reception and asked if he had heard a rumour about
Brown, and when told he had, asked if he was going to investigate
it.  Lemieux told him he would if there was anything to it.  An
ironic aspect to his evidence is that it appears the rumour Lemieux
had heard was to the effect that Cole and Brown had a condominium
in Mexico being used to entertain clients.

84        Later in time at the suggestion of Brown, the I.C.P.B.
did inquire briefly into the matter of the loss, but it was not an
investigation of Brown.

85        The evidence clearly establishes Ostler published
defamatory remarks about the plaintiff to Cpl. Didyck, John Burke,
Gord Mathison, and Dan Millar.  In respect of defamatory remarks by
Ostler regarding salvage fraud to Burke a ruling was made during
the course of trial that evidence was admissible only on the issue
of Ostler's malice.

86        I find the evidence is clear neither Cpl. Didyck, John
Burke, nor Dan Millar republished any defamation by Ostler of the
plaintiff.

87        The evidence indicates Gord Mathison re-published what he
had been told almost immediately to Burke.  There is no evidence
regarding any further republication by Mathison.

88        Cole published defamatory remarks of Brown to Millar
which had their origin in what he had been told by Ostler but had
been altered or modified in significant detail.

89        The defamatory remarks published of Brown by both Ostler
and Cole were calculated to disparage Brown in the way of his
business as an insurance adjuster, and as principal of an insurance
adjusting firm.  They are within the category of slander per se,
for which:

... the plaintiff need not allege or prove the
existence of special damages since damages are
presumed to have been suffered from the very
nature of the utterance either because they
are so obviously damaging to the financial
position of the victim that pecuniary loss is
almost certain, or so intrinsically outrageous
that they ought to be actionable even if no
pecuniary loss results.

[Brown, Law of Defamation in Canada, supra,
pp.420-42l].


90        The defamatory remarks were to the effect the plaintiff
was involved in matters of fraud, and imputed dishonesty.  The
remarks clearly focused upon his integrity.  Several of the
witnesses from the insurance community who gave evidence at trial
including the defendant Cole, supported in their evidence that
nothing could be more devastating to the career of an insurance
adjuster than the taint of fraud.

REPUBLICATION

91        The plaintiff seeks to impose liability for the
republication by others of the defamatory statements alleged to
have originated with the defendant.  The plaintiff pleaded several
particularized instances of republication. [Amended Statement of
Claim, paras. (a) - (r)].

92        The particularized allegations of republication and the
evidence relating to each must be individually considered to
determine:

          (a)  if the source of the alleged
               republication was one of alleged
               defamatory statements referred to in
               the pleadings;

          (b)  if any defence, qualified privilege
               or otherwise, applies in respect of
               the republication; and,

          (c)  what damages flow from the
               defamation in question, including
               loss of reputation, or business, to
               the plaintiff.

93        The general rule in respect of a defamatory publication
is that a person is liable only for their own publication, not
repetition by another.

Republication occurs where the person to whom
the words were originally published
communicates them to someone else.  The
general rule is that a person is responsible
only for his or her own defamatory
publications, and not for their repetition by
others.  There is no liability for a
republication by a third person that the
defendant neither authorized nor intended to
be made.

     There is no liability upon the
     original publisher of the libel when
     the repetition is the voluntary act
     of a free agent, over whom the
     original publisher has no control
     and for whose acts he is not
     responsible ...

However, there are several exceptions to this
rule.  The defendant may intend or authorize
another to publish a defamatory communication
on his or her behalf.  Secondly, a defendant
may publish it to someone who is under some
moral, legal or social duty to repeat the
information to another person.  Thirdly, a
defendant may be liable if the repetition was
the natural and probable result of his or her
publication.  These rules apply only where the
information repeated is the same or
substantially the same so that the sum and
substance of the original charge remains.
Once the requirements have been satisfied, the
plaintiff is entitled to recover damages from
the defendant both for the original
publication and for the republication by the
person to whom it was initially published.

[Brown, The Law of Defamation in Canada,
supra, p.350-1].


94        The only exception the plaintiff has pleaded and relies
upon is that the repetitions were "... the natural and probable
result of his or her publication." [Statement of Claim, para.15].

REPUBLICATION ATTRIBUTABLE TO COLE

95        The natural and probable result is not the same test
implicit in tort claims.  Foreseeability takes account of
possibilities, natural and probable results are anchored in
probabilities.  A reasonable possibility might therefore exist that
a person to whom a defamatory statement was made might republish
it, but to enforce liability on the original publisher for
liability the onus to be met by the plaintiff is that republication
was probable. [Peters Brown v. Regina District Health Board et al
26 C.C.L.T. (2d) 316 (Sask.Q.B.)].

96        It was the evidence of Cole, which I accept, that Millar
was the only person to whom he spoke allegedly defamatory remarks
about the plaintiff.  When speaking to Millar the defendant Cole
was well aware of his friendship with Brown.  The context of the
remarks were directed toward an internal review of one of Millar's
files.

97        I do not consider that a reasonable person in the
circumstances would, or should, consider repetition by Millar would
be a natural or probable result. I also accept Millar's evidence
that he did not repeat the defamation to anyone.  The plaintiff has
not established liability on the part of the defendant Cole for any
alleged repetition by another of his defamatory statement of the
plaintiff.

98        The context of the conversation between Ostler and Cpl.
Didyck was not one that would lead a reasonable person to believe
that the repetition of the defamatory remarks would naturally or
probably result.  Cpl. Didyck did not repeat the defamatory remarks
apart from recording them after the event into notes he was asked
to make and provide to his superior officer as a result of the
prospect of this litigation.

99        I heard no evidence from Mathison, or in respect of
Mathison, that would indicate repetition by him could be assumed a
natural and probable result of his hearing defamatory remarks about
the plaintiff.  Mathison was an employee of Bennett Cole.  Why
would it be natural and probable he would repeat what was
supposedly confidential information of a Bennett Cole
investigation?

100       The only evidence that Gord Mathison did repeat the
defamation, was regarding repetition to another Bennett Cole
employee.  The case law to which I was referred suggests only very
cogent evidence surrounding the original publication would support
the view republication would be a natural and probable result.  I
do not by analogy or in logic find those circumstances to exist
here.

101       On balance I am also of the view the circumstances of
Ostler's conversation with Millar regarding the plaintiff cannot be
said to lead naturally and reasonably to the expectation of
repetition.  Millar initiated that conversation and was asking some
pointed questions, albeit attempting to do so in an off-hand
manner.  Ostler indicated a feeling he was being set up.  In a
sense he was.  Millar's approach was directed toward trying to
obtain confirmation of what was occurring, who was involved, and
the likely source of the information.  Millar's approach indicated
he himself was investigating, rather than a person likely to be
involved in a spreading of the information.

102       Even if it could be said repetition was the natural and
probable consequence of Ostler's proven slanders, which I expressly
reject, there are several matters of serious evidentiary concern as
to the source of the defamatory statements circulating about the
plaintiff which are particularized in the pleadings.  The evidence
indicates there was circulation of some defamatory rumours about
the plaintiff that clearly pre-date the defamatory statements of
Ostler to Cpl. Didyck.

103       There is strong evidence in particular of one identified
person, Stacey, who published serious defamatory statements of the
plaintiff well before January or February 1992.  The extent of his
direct publication of defamatory rumour and any consequent
republication cannot be gauged from the evidence before me.

104       The seriousness of the defamatory Stacey rumours are
illustrated in the evidence of Joanne Barnes.  Ms. Barnes came to
Vancouver in November 1991 as the Commercial Union Claims
Superintendent for B.C. and the Yukon.  She was here only until May
1992, then transferred to Calgary.

105       In the last week of November or early December of 1991,
and certainly prior to Christmas of 1991, Ms. Barnes was approached
by Stacey, then an employee of General Accident, who asked her to
meet with him.  They met in a coffee shop.  Stacey told Ms. Barnes
because she was new in town he wanted to speak to her about who she
could trust.

106       Stacey then proceeded to relate a bizarre story about the
plaintiff, his company, and Grant Stenmark one of the plaintiff's
employees.  Stacey said he had concern about the billing practices
of the plaintiff's firm and in particular the billing of Grant
Stenmark.  He told her that the plaintiff was under investigation
by the I.C.P.B.  He said the plaintiff owned a condominium in
Mexico and was wining and dining claims personnel.  He told her the
plaintiff was under investigation for "diddling" with salvage.
Stacey described how Friday night was "party night" at the
plaintiff's office where he maintained a refrigerator full of beer
for entertaining insurance industry employees.

107       Stacey wanted Barnes to provide him access to Commercial
Union files so he might check on the billings of the plaintiff's
company.  When Barnes suggested she would call the I.C.P.B. Stacey
told her they would deny the matter.  He said he was assisting the
I.C.P.B. investigation and was sworn to secrecy.  When Barnes
suggested she would talk to her Branch Manager about the matter she
was told by Stacey not to do so because there was a graft
investigation underway and others might be involved.

108       Barnes met several times for lunch with the defendant
Cole and with employees of Bennett Cole during her time in
Vancouver.  Neither Cole nor any Bennett Cole staff member spoke of
the plaintiff to her.

109       In January or February 1992 Ms. Barnes met the plaintiff
in the lobby of her office building and he was "distraught" over
rumours about him.  She told him that she had heard rumours of
"graft" and "diddling of salvage", but she did not disclose her
source.

110       Ms. Barnes met the plaintiff in April 1992 and on that
occasion she told him the source of the rumours she had heard was
from Stacey.  The plaintiff appeared shocked that it was Stacey,
and told her he had traced the rumours to Bennett Cole.  Ms. Barnes
said she had heard nothing about him from employees of Bennett
Cole.  Ms. Barnes had not heard rumours of the plaintiff and drugs
until the plaintiff himself told her.

111       In March of 1992 she said she was approached by Kevin
McIntyre, a Commercial Union employee, who said he had heard
rumours about the plaintiff.  Barnes told him she knew and had
dealt with it.

112       The plaintiff, personally and through his solicitors,
pursued Stacey regarding his publication of defamatory statements
about him.  This was concurrent in time to his pursuit of the
defendants.

113       A written apology by Stacey dated June 3, 1992 reads in
part:

In recent months, there have been rumours that
Mr. Paul Brown and other members of his
company, Paul Brown and Associates, Insurance
Adjusters Ltd., have been under investigation
for fraud along with several branch managers
of insurance companies in Vancouver.

It has been rumoured also that Mr. Brown is
the owner of condominiums in California and
Hawaii which are offered as inducement to
various clients of his firm.

I have since determined, and want to make
clear, that there is absolutely no truth to
these statements.

...

I therefore wish to apologize to him and his
family for the harm caused by repeating such
rumours to others in the insurance industry.

[Ex.1, Tab 25].

114       It would appear the plaintiff accepted that Stacey did
not originate rumours of fraud but only repeated them.  The
evidence of Ms. Barnes however indicates he made the defamatory
remarks of Brown to her in November or December of 1991.  If he was
repeating and not originating the rumours the logical inference is
those rumours were extent even earlier in 1991.

115116    There is obvious similarity in the defamations being
circulated by Stacey to some made later by Ostler in speaking with
Cpl. Didyck.  At least in part that might tend to indicate Ostler
was repeating rumour rather than originating it.  That also
indicates someone else originated rumours of the plaintiff.  If
Stacey did not originate the defamatory rumours he published then
someone else prior in time to him did.

117       Stacey named Brian Regan of the Commercial Union as the
person who "originally gave me this information." [Ex.1, Tab 24].
Brian Regan denied this to the plaintiff. [Ex.3, Tab 94].

118       Burke's evidence was that he had known of Brown's
criminal record involving drugs for several years.  There is the
evidence of Ostler that Gord Mathison was apparently a person who
knew a great deal about Brown, including his criminal past and
Pardon.  The plaintiff acknowledges some former employers and past
associates knew of his criminal record.

119       There are also problems arising from the evidence of
several of the witnesses regarding republication.  It is difficult
to establish when they heard a certain rumour, from whom, and
exactly what they heard.  The timing of when certain matters were
first heard is of importance both in trying to ascertain if it
occurred before Ostler's first alleged slander of the plaintiff in
conversation with Cpl. Didyck, or after the plaintiff had himself
spoken to persons advising rumours about him were untrue.  In May
1992 the plaintiff widely circulated within the insurance community
an information letter, appending a letter of apology obtained from
Bennett Cole, which reported he had been accused of fraud.

120       The defendants argued that the plaintiff may have caused
an investigation into himself and drugs when he applied for a
Pardon.  There is no tangible evidence that occurred.  Information
supplied in requesting a Pardon is however checked and a
possibility does exist others might become aware of his past
connection to drugs and his criminal record, or be reminded of it.

jš       The evidence is that although the plaintiff, through his
solicitors, aggressively pursued obtaining an apology from the
defendants prior to commencement of this action, no apology was
sought of them in respect of any matter relating to drugs.

122       The plaintiff's own evidence was that Brian Regan, claims
manager with the Commercial Union, told him he had heard drug
rumours about the plaintiff as early as June 1991.  He also said he
had heard the rumour regarding the plaintiff owning condominiums
and offering them to clients, and that he held parties and supplied
clients with women.  Regan denied ever hearing a rumour about fraud
involving the plaintiff. [Ex.3, Tab 94].  This must cast doubt upon
Stacey's statement as to his source of information.

123       I did not have the benefit at trial of either Stacey or
Regan giving evidence.

124       There is no evidence to support an inference that Cole
was involved in the origin or spread of any drug-related rumour.
Ostler referred to drugs in the defamatory remarks made to Cpl.
Didyck, but the evidence of Burke would indicate Ostler did not
make reference to drugs in the defamatory remarks made to him and
repeated to him by Gord Mathison.

125       Cpl. Didyck certainly did not further publish any
drug-related rumour originating with Ostler.  Cpl. Didyck in any
event had no connection to the insurance community.

126       For these many reasons it is necessary that the evidence
tendered in respect of republication by others suggesting a
widespread circulation of defamatory rumours concerning the
plaintiff can be traced to the defendants must be closely examined.
That examination in my view excludes the defendants as the source
of alleged republication by others of drug-related rumours
concerning the plaintiff.

127       I accept that on a balance of probabilities the plaintiff
has shown that apart from the defendants three employees of Bennett
Cole did publish slanderous rumour traceable to Ostler.  Mathison
immediately repeated what he had heard from Ostler to his
co-employee Burke.  Murray, who is also a Bennett Cole employed
adjuster, told both Donald Jones and Bob Beddard that Brown was
under suspicion of insurance fraud and Ostler was working with the
R.C.M.P. on an investigation.  Insurance fraud and Ostler working
with the R.C.M.P. makes the origin of this publication attributable
to Ostler.

128       Rose Gidzinski, another Bennett Cole adjuster, denies
telling Kevin McIntyre of the Commercial Union that Paul Brown was
involved in an insurance fraud involving conversion of salvage with
about a $100,000 value was involved.  The mention of salvage,
$100,000 being involved, and that someone at Bennett Cole was
investigating the matter, reasonably links the origin of the rumour
to Ostler.  I accept McIntyre's evidence as to the conversation.

129       I do not find the plaintiff established that the drug
rumour heard by Cindi Marsden can be traced in origin to Ostler.

130       The rumour passed by Sherry Bassett to Cho, apparently
reported as coming from Werner and Spong cannot on the evidence be
traced in origin to Ostler.  I accept that Cho did not tell the
plaintiff he heard he was under investigation for fraud, and Cho
was unaware of the basis for the alleged investigation.

131       I do not find the rumour regarding the plaintiff and an
investigation for drugs, heard and passed on by Sandra Sakich, can
be attributed in origin to Ostler.

132       I previously commented that the rumour Lemieux had heard
prior to inquiry by Cole, involved Cole and Brown providing use of
condominiums to clients.  I do not on the evidence attribute the
origin of that rumour to Ostler.

133       The rumour heard by Mike Talbot from Bugiel or Hogan
contained reference to Brown being investigated by the R.C.M.P.
regarding salvage and the proceeds of salvage.  The essence was an
allegation Brown had not turned back the proceeds to the insurance
company.  There was also reference to cocaine trafficking and
surveillance of Brown by the R.C.M.P.  He thought he was told Cpl.
Didyck was doing the investigations.  The reference to Cpl. Didyck
is suggestive of some link to Ostler.

134       This rumour however appears to me more a composite of
several defamatory remarks.  The origin may be a combination of
several rumours from varying sources.  I conclude Ostler's
defamation might in part have contributed to this republication,
but not the whole of the statement.

135       Mr. Talbot communicated what he had been told to his
supervisor Don Oxenbury and to co-employees Chan, Lyndon, and
Bennett, and to Mr. Daniels an insurance adjuster Talbot believed
was a friend of the plaintiff's and would warn him of the
circulation of the rumour.  I cannot accept the evidence some of
these persons indicated to Talbot they had heard parts of the
rumours before as relevant.  The parts they might have heard before
may not have had their origin with Ostler.  I accept Ms. Chan's
evidence she did not tell Cho she had heard the plaintiff was being
investigated for fraud.

136       I do not accept that the evidence of Werner as contained
within his written statement dated March 9, 1993 that at a lunch he
attended in March or April 1992 Dean Russell and Jerry Cox
mentioned they had heard rumours to the effect Paul Brown and Paul
Brown & Associates were being investigated with respect to the
conduct and operations of the business can be attributed to Ostler.
That description easily comes within the parameters of the slanders
known to originate with Stacey.

137       In summary, of the many references pleaded and
particularized of rumours circulating about the plaintiff in early
1992, the plaintiff has established on the evidence only a few that
appear to have the necessary evidentiary nexus required at law to
trace their origin in whole or part to the defendant.

138       What is of import is that even those proven publications
do not support the alleged spread of rumour to be the natural and
probable consequence of the defamations proven to be made by the
defendants.

QUALIFIED PRIVILEGE/MALICE

139       Each defendant pleads a defence of qualified privilege in
respect of every occasion of publication alleged against him.  Mr.
Justice Cory in Bardyn et al v. Botiuk et al, [Botiuk v. Toronto
Free Press Publications Ltd. 126 D.L.R. (4th) 609 at p.626
(S.C.C.)], summarized the law:


Qualified privilege attaches to the occasion
upon which the communication is made, and not
to the communication itself.  It was explained
in this way by Lord Atkinson in Adam v. Ward,
[1917] A.C. 309 (H.L), at p.334:

     ... a privileged occasion is ... an
     occasion where the person who makes
     a communication has an interest or a
     duty, legal, social or moral, to
     make it to the person to whom it is
     made, and the person to whom it is
     so made has a corresponding interest
     or duty to receive it.  This
     reciprocity is essential.

[See also McLoughlin v. Kutasy (1979), 97
D.L.R. (3d) 620 at pp.623-4, [1979] 2 S.C.R.
311, 8 C.C.L.T. 105].

Where an occasion is shown to be privileged,
the bona fides of the defendant is presumed
and the defendant is free to publish remarks
which may be defamatory and untrue about the
plaintiff.  However, the privilege is not
absolute.  It may be defeated in two ways.
The first arises if the dominant motive for
publishing is actual or express malice.
Malice is commonly understood as ill will
toward someone, but it also relates to any
indirect motive which conflicts with the sense
of duty created by the occasion.  Malice may
be established by showing that the defendant
either knew that he was not telling the truth,
or was reckless in that regard.

Second, qualified privilege may be defeated if
the limits of the duty or interest have been
exceeded.  In other words, if the information
communicated was not reasonably appropriate to
the legitimate purposes of the occasion, the
qualified privilege will be defeated.  This
was discussed at some length in Hill, supra,
and there is no need to repeat it in these
reasons.


OSTLER

140       Ostler is alleged to have published slanders to Cpl.
Didyck, Mathison, Cole and Millar.  The slanderous statements made
to Cpl. Didyck, apart from the fact the plaintiff had a criminal
record and had received a Pardon, were untrue, and were made
dishonestly or with total disregard to the truth, and were
therefore malicious.

141       The occasion of the conversation between Cpl. Didyck and
Ostler was not a privileged one in respect of a defamation of the
plaintiff.  Cpl. Didyck sought no information about the plaintiff,
and had no interest in receiving information about him.  He
specifically told Ostler the unsolicited information slanderous of
the plaintiff was of no interest to him in the context of the
inquiry he was making.  The occasion therefore lacked the
reciprocity of interest or duty required of a privileged occasion.
[Adam v. Ward, [1917] A.C. 309 at 334 (H.L.)].

142       The manner of the repetition of like slander to Burke and
Mathison is indicative of malice on the part of Ostler but the
evidence does not support an inference of reciprocity of an
interest or duty between the parties on those occasions.  Indeed
the evidence of Burke suggests that Ostler was interrupting his
work to tell him something he had no interest in hearing and did
not believe.  Knowledge as to the falsity of the information being
conveyed destroys any privilege.

143       The slanderous information passed by Ostler to Cole
cannot be shielded by a defence of an occasion of qualified
privilege.  An employee reporting to his employer in respect of a
matter of present or anticipated business interest does establish
an occasion of qualified privilege.  Ostler however knew there was
no investigation of the plaintiff by the R.C.M.P., the plaintiff
was not suspect by the R.C.M.P. for any reason, and Ostler was not
being retained or consulted in any manner concerning the plaintiff.

144       The privilege normally attaching to the occasion is not
valid here as there truly was no business present or anticipated on
which to report, and what Ostler did report was knowingly false.

145       The occasion when Ostler spoke by telephone with Millar
could also give rise to an occasion of qualified privilege.  It was
a business call from the claims manager of an important client.
Ostler was being asked specific questions relating to a matter
obviously of interest to Millar.  Ostler was perceived as a person
who had knowledge and could provide accurate information of
assistance to a client.

146       The defence of an occasion of qualified privilege was
however lost to Ostler by his intentional dishonesty in confirming
to Millar there was an investigation of the plaintiff.

COLE

147       Cole's luncheon conversation with Millar concerning the
plaintiff could be an occasion of qualified privilege.  It was a
meeting between the principal of an adjusting company doing a
significant amount of work for Millar's company.  Cole was
providing information about another person doing business with
Millar who was suspect in his handling of an adjustment of a
particular loss that might be a claims file of General Accident.
This is information Millar would certainly have an interest in
receiving and Cole a duty arising both morally and from their
business relationship, to give.

148       Cole however was either extremely careless or
deliberately misleading in his publication to Millar about the
alleged investigation being conducted by employees of his firm
concerning the integrity of the plaintiff in a theft loss.  Cole
made no inquiry or investigation of the information given him by
Ostler, despite his knowledge the police did not hire one insurance
adjuster to investigate allegations of fraud against another.  Cole
made no attempt to find out if the suggestion the plaintiff knew
the insured involved in the theft claim was information that came
from the R.C.M.P. or originated with Ostler.  Cole was well aware
of the serious import of the suggestion that the plaintiff knew the
insured.  Indeed Cole said it was his motivation for telling
Millar.

149       The extremely devastating effect that such information
would have upon the plaintiff if not true must also weigh in the
balance of the extreme carelessness in not carefully checking the
factual foundation of the serious implication he deliberately
intended to convey.  The inexplicable change made by Cole from the
information he received from Ostler to allege not one, but two, of
his employees were involved in the investigation and that the
I.C.P.B. was involved heightens the fact that Cole employed crafted
embellishment to the information originally received from Ostler.

150       I also question Cole's professed sincerity as to honestly
believing he was fulfilling a duty to convey the information to
Millar when he spoke to him at the luncheon meeting.  Had he truly
believed this, he would not have delayed conveying so important a
matter until they were having their bi-monthly lunch together, then
raise it in conversation in the "by-the-by" way described by
Millar.

151       The luncheon during which the slander was made was for
the purpose of obtaining business.  The plaintiff was a competitor
and I draw the inference from the evidence the true intent of the
remark in question was to disparage the plaintiff and to enhance
the business prospects of the defendant.

152       I accept Cole was motivated by malice or ill-will in
speaking to Millar as he did.  The defence of qualified privilege
fails.

CONTRIBUTORY NEGLIGENCE

153       The defendants plead that the plaintiff has contributed
to his own damages by widely circulating an information letter
appending the apology letter signed by Bennett long after the
rumours complained of had quieted or ceased to circulate.  The
correspondence contained reference to alleged fraud.  The plaintiff
agrees his intent was to "... saturate the industry ..." with the
letters to assist in the rehabilitation of his reputation.

154       An apology to have effect should be public, not private.
It would be only in the clearest of instances of very limited
circulation of a defamation that notice of the apology could
effectively be directed to a small restricted number or group of
persons.

155       The plaintiff was clearly defamed in his calling.  The
circumstances indicated the defamation did escape the bounds of
original publication and some repetition amongst persons in the
insurance industry and related fields occurred.  The plaintiff was
without ability to immediately gauge which persons, companies, or
firms with whom he dealt had heard the defamations.

156       The insurance industry was acknowledged by the several
witnesses as a community susceptible to rumour.  Circulation of a
rumour could be rapid.  The regional and national aspects of the
insurance industry gives good reason to fear defamatory information
might well transcend provincial boundaries and the damage escape
local confine.

157       In early March 1992 the plaintiff's solicitor requested
of the defendants they instruct their staff the rumours were
without substance and that any staff person involved in the spread
of the rumour should immediately contact everyone to whom the
defamation was passed and advise the rumour was false.  A request
was also made for a public apology by notice of retraction
published in the "Adjusters' Quarterly", an industry trade
publication.  These reasonable requests were not acted upon by the
defendants.  Cole was seriously derelict in not taking the matter
seriously and dealing with it expediently.

158       It is true that many persons who had not heard of fraud
allegations against the plaintiff were first informed by receipt of
the information and apology letter.  That is unfortunate, but a
necessary incident of reasonable measures taken by one defamed to
try and rehabilitate his reputation.  Far better knowledge of the
fact of defamation, accompanied by proof of its untruthfulness, be
coincident, than to incur the inevitable risk that in future old
rumours might surface to again disparage the plaintiff.

159       It would be an impossible and unfair burden to impose on
a person defamed the responsibility of responding to defamations
that had reached the public domain by only responding on the basis
of selective and private notice of apology.

160       I do not consider the plaintiff acted unreasonably in the
circumstances and his circulation of the letter of apology does not
give rise to contributory negligence on his part.

DAMAGES

161       The plaintiff claims damages for the defamations of him
by the individual defendants Ostler and Cole, with the corporate
defendant also responsible for those damages based upon its
vicarious liability as employer.

162       The plaintiff also seeks damages of the defendants caused
from republication of the defamations by persons the plaintiff
chose not to make party to the action.

163       The damages sought are compensatory, consisting of
general, aggravated, and special damages for defamation; and also
for punitive damages.

164       Damages in defamation cases are presumed from the fact of
publication of the defamation and awards are made "at large" as
intangible component losses involving reputation and injury to
feelings are not capable of precise calculation. [Hill v. Church of
Scientology of Toronto, [1995] 2 S.C.R. 1130 (S.C.C.) at p.1197];
Ley v. Hamilton (1935), 153 L.T. 384 (H.L.) at p.386 quoted with
approval].

165       There is no cap set upon damages for defamation.  It is
a feature of defamation actions that special damages are rarely
claimed, and if claimed exceedingly difficult to prove. [Hill v.
Church of Scientology (S.C.C.), supra, p.1196].

COMPENSATORY DAMAGES - ENTITLEMENT

GENERAL DAMAGES

166       I have found the defendant Ostler defamed the plaintiff
when he spoke to Cpl. Didyck, and thereafter when he spoke to
Mathison, Cole, and Millar.  I also found the defendant Cole
defamed the plaintiff when he spoke of him to Millar at the
luncheon meeting of January 29, 1992.  I have found the defendants
not to be responsible for the damages alleged to have occurred by
any republication of the defamatory statements.

167       Ostler's past involvement with Cpl. Didyck had always
been in the context of his work as an adjuster.  The instigating
call from Cpl. Didyck to Ostler on the occasion in question here
was placed to his office.  The corporate defendant Bennett Cole was
aware of Ostler's established contacts with the R.C.M.P. and it was
considered appropriate to his employment with the firm.

168       The conversation in which Ostler told Cole of the
approach to him by the R.C.M.P. was during the course of a meeting
or a telephone call discussing business of the company.  The
conversation with Mathison occurred in a Bennett Cole branch
office, during working hours, and presumably while Ostler was there
on company business.

169       The luncheon meeting by Cole with Millar was for the
purpose of advancing the business of the firm.  The motivation of
Cole in speaking the words defamatory of the plaintiff was to gain
business advantage.

170       I find that when each defendant spoke the defamatory
remarks they were acting within the course and scope of their
duties as employees of the corporate defendant.  The defendant
Bennett Cole is therefore jointly liable in damages with the
individual defendants for damages assessed.

SPECIAL DAMAGES

171       The plaintiff seeks an award of special damages, based
upon the rumours resulting in the plaintiff suffering a depressive
illness that has defied treatment, and disabled him from being able
to operate his own insurance adjusting firm, or indeed to function
as an insurance adjuster.  The plaintiff alleges the result has
been a loss of income to the plaintiff from his business, and an
inability for the plaintiff to continue in the only trade for which
he is trained.

172       The plaintiff sold his adjusting firm in October 1993 at
a large discount from what he felt it to be worth a year earlier.
The evidence however supports the fact the insurance adjusting
industry was in a decline, or depression, since approximately late
1991.  Several factors were combining to cause the decline
including:

          -    an overall reduction in claims;

          -    property loss deductibles were
               raised in 1992, decreasing claims,
               particularly smaller claims
               requiring adjustment services;

          -    milder weather reduced the high
               level of claims occurring in the
               winter of 1990-1991;

          -    changes in underwriting;

          -    increased change to "in house"
               adjusting;

          -    increased use of telephone
               adjusting, with reduced fees;

          -    consolidation of claims with
               national adjusting firms; and,

          -    reduction by I.C.B.C. of assignment
               to independent adjusting firms, and
               increased competition amongst firms
               caused scrambling to retain their
               market share.

The evidence does not support any loss of business to the plaintiff
resulted from any defamatory statement by the defendants.

173       The plaintiff, when investigating selling, appears to
have established too high a worth for his business, waited too long
in a falling market, then sold low rather than await a recovery.
The plaintiff was not alone; the evidence indicates many larger,
longer established, multi-branch firms were sold at very low prices
because of the depressed market.  The defendant firm was a good
example.  Its market value apparently fell approximately
seventy-five percent in a year to 18 months from 1992 values.

174       The plaintiff bases his claim however not so much on the
loss occasioned in the sale of the business, as the loss of income
to him which followed the events of the spring of 1992, through
selling the business in the fall of 1993, and his inability to be
employed in the industry since.

175       When Dr. Selvakone, the plaintiff's treating psychiatrist
reported to his family physician Dr. Gable on August 31, 1992, he
noted "... marked evidence of endogenous depression ...":

In the management plan even though Paul has
good enough reasons to show reactive
depression Paul in addition showed marked
evidence of endogenous depression affecting
his memory and concentration as well as his
work as such it was decided to treat him with
the antidepressant Trazadone 100 mg pohs which
will gradually increase to the maximum dose to
control his depression.  At the same time he
will greatly benefit with cognitive behavior
techniques in controlling his depression and
to cope with his work and work related
problems.  Initially I had some concern over
his decision to sell off his business as I
suspected that depression may have played a
role in making that decision.  However, after
further exploration it was felt he has made
the right decision.  Also Paul has alternative
plans for his future.  I will continue to
follow him in my clinic to monitor his
depression and provide him with cognitive
behavioral therapy in dealing with his problem
and I will keep you informed about his
progress in due course. ...

176       Endogenous depression is "... a descriptive syndrome for
a cluster of symptoms and features occurring in the absence of
precipitants ..." [Stedman's Medical Dictionary].  This has
significance when considering whether it has been shown to be
caused by the defendants proven defamation.

177       The medical evidence indicates the plaintiff was a person
whose family history indicated a "genetic loading" predisposing him
to depressive illness.  His personal medical history indicated
problems from personal and business related stress.  He was suspect
by his family physician of valium abuse.

178       Dr. Selvakone notes in his letter of January 15, 1996
[Ex.11] at p.3:

... I do accept the fact that Paul did believe
that he was not carrying any secret about his
past and he never thought that he had to share
this secret with his business colleagues.
Paul firmly believed that his past
drug-related conviction was pardoned.  He
operated on these premises, completely
transformed himself into a responsible
business man [sic] and father.  There is no
clear indication for Mr. Brown to tarnish his
image by sharing the "secret" with all his
business colleagues.  Furthermore, the rumor
that damaged his business and his reputation
was that he was currently investigated for a
drug-related offense.

179       In my view, the defendants did not originate nor publish
within the insurance community any drug-related defamations of the
plaintiff.

180       The evidence of Dr. Selvakone as written in his May 30,
1994 report was that the plaintiff was severely depressed,
diagnosed as having Major Affective Disorder Depressed - with
melancholic features.  Dr. Selvakone considered him "... somewhat
resistant to psychotherapeutic approaches because of the intensity
of his depression ...", "... psychiatrically disabled based on his
depth of depression ..." and in his opinion "... not suitable to
any forms of rehabilitation or any alternative employment
opportunities."  Dr. Selvakone was unable to predict a date when
the plaintiff would be able to return to work.

181       In his updated report of January 15, 1996 Dr. Selvakone
reported that:

Based on the observation and evaluation done
on him to date, I have not changed my
diagnosis, prognosis, and his suitability to
return to work (as stated in my letter dated
May 30, 1994).

182       Dr. Janke, who examined the plaintiff on behalf of the
defendants, opined that the plaintiff would likely be able to
return to full-time work, at some future time.  He was not specific
as to when or to what work.

183       The plaintiff has apparently decided he is not going to
return to any work in this country.  He has talked of moving to the
United States or Thailand.  The plaintiff's depressive condition
has apparently effected his memory capabilities, although this was
not significantly demonstrated during his trial evidence.  The
evidence of Dr. Selvakone is that the plaintiff's reduced memory
capacity has to date made his efforts at education or re-training
unproductive.

184       The evidence is the plaintiff appears to be awaiting the
outcome of this action to determine a future course.  He continues
to subsist on monthly total disability insurance benefits.  If the
outcome is taken to vindicate his view that the defendants have
wronged him, and his reputation is upheld, this may help him start
upon a new course to become productive.  It is unlikely in any
event he will go back to any trade involved with the insurance
industry.

185       I conclude that by the spring of 1992 the golden years of
his rising income and expansion of his firm were likely over, and
not only was the value of the business as a going concern subject
to dramatic decrease from market forces, so likely would be the
high earnings he had enjoyed.  The plaintiff had however through
his hard work, determination, skill and talent always been a top
producer.  There was no reason to believe his future in the
industry would not continue, whether self-employed or employed by
another, with earnings at the higher range as for other top
producing adjusters.

186       I am unable however to find the plaintiff has proven that
the defamations attributable to the defendants, were the cause of
the loss in value of his business, income, or the current state of
employment disability of the plaintiff because of his depressive
illness.  The evidence shows only a few of the specific incidents
of republication alleged can be traced to the defendants.  If there
were industry-wide defamatory rumours by the defendants as alleged
by the plaintiff the evidence does not support the bulk being the
responsibility of the defendants.

187       There is no evidence the defamation by the defendant Cole
went beyond its initial recipient Mr. Millar.  I do not accept that
one single incident is the cause of the depressive state of the
plaintiff and its consequence.

188       In respect of the proven defamations of Ostler, I am
satisfied the defamatory statements made to Cpl. Didyck were never
repeated so as to become known in the insurance industry.  The
defamatory information given by Ostler to Cole as stated at most
did not go to anyone in the industry except Mr. Millar.  The
repetition of defamatory information by Ostler directly to Mr.
Millar went no further.

189       The only proven defamation by Ostler suggesting any link
between the plaintiff and drugs was to Cpl. Didyck.  The
information to Cpl. Didyck was in part true; the plaintiff had past
criminal convictions and was pardoned.  There is no evidence to
link comments of trafficking in cocaine, or being under
surveillance in relation to drugs to Ostler.

190       The evidence in respect of the plaintiff and drugs
indicates an origin much earlier in time to any suggested
defamation by Ostler.  They apparently were circulating in
insurance circles in mid-1991.  It is possible many people in the
industry were aware of the plaintiff's prior criminal record
involving drugs.

191       The effect of the active promotion of rumour, similar to
that alleged against the defendants, by Stacey is of major
significance.  Stacey was publishing defamatory statements of the
plaintiff alleging dishonesty in billing practices, graft in
soliciting business, and "diddling" (in common meaning cheating or
swindling) in respect of salvage.  Stacey provided this information
to a complete strange who was in a very senior claims capacity of
a major insurance company, well before it is alleged Ostler made
defamatory comment to anyone about the plaintiff.

192       Stacey was also an employee at the time of the General
Accident, the plaintiff's major client, where Millar was claims
manager.  It is interesting the plaintiff said he was told by
Millar that several of his staff had heard rumours of fraud,
although Millar denied he told that to the plaintiff.  It does
illustrate however how quickly the plaintiff chooses to blame all
his troubles upon the defendants and seems to ignore that fact
there were obviously other sources.

193       Indeed the plaintiff irrationally appears to have reached
the conclusion that Cole was the source of all rumour about him.
He believed Cole hated him and the rumours were an orchestrated
attempt to put him out of business.  His beliefs bordered paranoia
and were entirely without support.

194       The fact appears to be that the plaintiff's success, high
profile, and perhaps somewhat innovative techniques in entertaining
and socializing with employees in the industry, made him the target
of more than normal interest for gossip, malicious or otherwise.
It is also the case that rumour tends to change or be enhanced in
the re-telling.  Several rumours over time can merge and be
incorporated in the one re-telling.  The evidence of witnesses is
also notoriously fragile as to when, what and from whom matters
were first heard.  The evidence in this trial exhibited all these
frailties.  They are matters of importance and I have tried where
appropriate to make every allowance in considering whether proof
required has been met.

195       On a consideration of all the evidence I find the
plaintiff has not met the required proof that the defamations of
the defendants can in law be said to be the cause of the
significant special damages for which claim is made.  The claim for
special damages is dismissed.

AGGRAVATED DAMAGES

196       Mr. Justice Cory in Hill v. Church of Scientology of
Toronto, supra, discussed the parameters as to when aggravated
damages would be warranted.

Aggravated damages may be awarded in
circumstances where the defendant's conduct
has been particularly high-handed or
oppressive, thereby increasing the plaintiff's
humiliation and anxiety arising from the
libellous statement.

197       The succinct description formulated by Robins J.A. in
Walker v. CFTO Ltd. (1987), 59 O.R. (2d) 104 at p.111, was adopted
and approved.

Where the defendant is guilty of insulting,
high-handed, spiteful, malicious or oppressive
conduct which increases the mental distress -
the humiliation, indignation, anxiety, grief,
fear, and the like - suffered by the plaintiff
as a result of being defamed, the plaintiff
may be entitled to what has come to be known
as "aggravated damages".

198       Essential to an entitlement of aggravated damages is a
finding that the defendant:

... was motivated by actual malice, which
increased the injury to the plaintiff, either
by spreading further afield the damage to the
reputation of the plaintiff, or by increasing
the mental distress and humiliation of the
plaintiff ...

[See, for example, Walker v. CFTO Ltd., supra,
at p.111; Vogel, supra, at p.178; Kerr v.
Conlogue (1992), 65 B.C.L.R. (2d) 70 (S.C.),
at p.93; and Cassell & Co. v. Broome, supra,
at pp.825-26; and Taylor v. Despard, supra, at
p.975].

199       Intrinsic evidence from the defamatory statement itself,
circumstances involved in the publication, or evidence of
surrounding circumstance indicating motive on the part of the
defendants to injure the plaintiff may be considered.

200       Examples of a number of factors that are to be considered
include:

... was there a withdrawal of the libellous
statement made by the defendants and an
apology tendered?  If there was, this may go
far to establishing that there was no
malicious conduct on the part of the defendant
warranting an award of aggravated damages.
The jury may also consider whether there was a
repetition of the libel, conduct that was
calculated to deter the plaintiff from
proceeding with the libel action, a prolonged
and hostile cross-examination of the plaintiff
or a plea of justification which the defendant
knew was bound to fail.  The general manner in
which the defendant presented its case is also
relevant.  Further, it is appropriate for a
jury to consider the conduct of the defendant
at the time of the publication of the libel.
For example, was it clearly aimed at obtaining
the widest possible publicity in circumstances
that were the most adverse possible to the
plaintiff?

[Hill v. Church of Scientology (S.C.C.),
supra, p.1206 at para.191].

201       Aggravated damages therefore add to and increase general
damages when additional harm is caused a plaintiff by outrageous
and malicious conduct by a defendant.  The conduct of the
defendants to be considered encompasses what occurred prior to the
publication of the defamation in issue through the trial of matter.202       Aggravated damages:

... represent the expression of natural
indignation of right-thinking people arising
from the malicious conduct of the defendant.

[Hill v. Church of Scientology (S.C.C.),
supra, p.1206 at para.189].

ENTITLEMENT TO AGGRAVATED DAMAGES - COLE

203       I find Cole is by reason of his conduct responsible to
the plaintiff for aggravated damages.  I have found he acted in
malice when he defamed the plaintiff in luncheon conversation with
Millar.  The evidence does not indicate Cole sought the first
opportunity, or any opportunity, to speak to Millar and attempt to
right the wrong occasioned the plaintiff.

204       Cole has on several occasions told persons in the
industry that the plaintiff is "making a mountain out of a
molehill" or words to like effect in speaking of the defamations
occasioned by the defendants.  He did not accede to reasonable
requests from the plaintiff's solicitor to mitigate and prevent
further publication, and delegated constructing a written apology
to his partner who was not involved in the matter.  His trip to
England was of more importance to him than trying to end the spread
of defamatory statements about the plaintiff amongst his own staff.

205       The issuance of a suitable written apology was delayed
through Cole's refusal to earlier agree to appropriate language,
and through trial his attitude tends to minimize or trivialize the
harm done to the plaintiff rather than indicate a sincere regret.
These matters have had the effect of contributing to an increase of
mental distress and humiliation caused the plaintiff.

ENTITLEMENT TO AGGRAVATED DAMAGES - OSTLER

206       I find the defendant Ostler by his conduct toward the
plaintiff is liable to the plaintiff for aggravated damages.

207       His tirade of defamatory remarks to Cpl. Didyck cannot in
the proper context of the inquiry being made do other than confirm
malicious intent on the part of Ostler.  The evidence does not
indicate any background from which one can rationally give
explanation to this conduct that would remove malice as the prime
motivating force.  It would be understating the matter to
categorize Ostler's conduct as merely insulting or high-handed.
The vitriolic attack he launched upon the plaintiff in speaking to
Cpl. Didyck borders upon hatred.

208       Ostler maintained through trial a denial of making
statements defamatory of the plaintiff as I have found he did.  He
sought to degrade the plaintiff in the eyes of a police officer,
his employer, and to his co-employee so as to falsely promote
himself as being a person of importance as he was being consulted
by the police for assistance.

PUNITIVE DAMAGES

209       In Hill v. Church of Scientology, supra, Cory J. at
para.196 defined punitive damages as:

Punitive damages may be awarded in situations
where the defendant's misconduct is so
malicious, oppressive and high-handed that it
offends the court's sense of decency.
Punitive damages bear no relation to what the
plaintiff should receive by way of
compensation.  Their aim is not to compensate
the plaintiff, but rather to punish the
defendant.  It is the means by which the jury
or judge expresses its outrage at the
egregious conduct of the defendant.  They are
in the nature of a fine which is meant to act
as a deterrent to the defendant and to others
from acting in this manner.  It is important
to emphasize that punitive damages should only
be awarded in those circumstances where the
combined award of general and aggravated
damages would be insufficient to achieve the
goal of punishment and deterrence.

210       I have considered, but reject, the plaintiff's claim for
punitive damages.  I do not find the proven misconduct of either
Cole or Ostler to be so malicious, oppressive and high-handed that
it offends the court's sense of decency.  It is not a situation
where large, powerful and wealthy defendants persist in the
defamation of vulnerable victims.

211       A good deal of evidence was given in respect of an
incident that occurred after commencement of this action when the
plaintiff, in company with Burke, by coincidence met Ostler
accompanied by two of his friends in a pub.  The evidence differs
as to whether the plaintiff's conduct toward Ostler's friends was
hostile or if Ostler's friends were attempting to intimidate the
plaintiff.

212       The incident was raised by the plaintiff in proof of
continuing malice on the part of Ostler toward the plaintiff.
Certainly the fact of this lawsuit created animosity between the
parties.  Their meeting in the pub was coincidental.  The actions
of which the plaintiff complains were those of Ostler's friends
rather than Ostler himself.

213       Ostler's friends may have been motivated by what they
perceived as wrongful allegation about Ostler being unfairly
pursued by the plaintiff in litigation.  I cannot attribute their
action as proof of malice on the part of Ostler.

214       I would characterize the motivation for the misconduct of
Ostler as trying to enhance his own reputation, to self-aggrandize
amongst his peers and appear important to his employer.  He appears
to have been loose of tongue, and lacking in the standards of
intelligence and integrity the adjusting and insurance claims
industry expects of its employees.  There was certainly no
organized effort to defame on his part apparent on the evidence.
His actions speak more of recklessness and stupidity than of guile.

215       In respect of Cole I find he failed to resist the
temptation, on a single occasion, to use extremely doubtful and
untested information about a competitor to gain business advantage.
His prompt and resolute advice initially to Ostler to do nothing as
it did not concern him, speaks of Cole's awareness and usual proper
ethical standard.  There was no organized attempt on his part to
bring down the plaintiff's business, nor any continuing plan to
exploit the defamation.  He was foolish, and later compounded it
with stubbornness.  His misconduct does not require an award of
punitive damages.

QUANTUM OF COMPENSATORY DAMAGES

216       Cole was well aware that rumour of financial impropriety
by an insurance adjuster in handling a claim was a most serious
type of allegation and could ruin that adjuster's career.  He had
known an adjuster several years earlier who had been ruined by
unfounded rumour of financial impropriety.  Cole was an experienced
senior adjuster, and a principal of a large, respected, independent
adjusting firm and well aware of the propensity for rumour to
develop and circulate within the insurance industry.

217       It was known to Cole that Millar was a friend of the
plaintiff's and that he received claims work from General Accident.
He was aware the effect of the defamatory statement could have
serious economic impact to the plaintiff.

218       Integrity is a fragile commodity which when damaged may
be repaired but is likely incapable of being fully restored.  The
Ontario Court of Appeal in Hill v. Church of Scientology of Toronto
18 O.R. (3d) 387 (Ont.C.A.) at p.440 cited the following as
relevant factors to the assessment of damages:

          -    the defamation was most serious;

          -    the defamation was published in
               circumstances designed to cause the
               most serious damage to the
               plaintiff's reputation and to ensure
               the widest circulation possible;
               and,

          -    the defamation caused serious injury
               to the plaintiff's feelings and that
               injury was not alleviated by any
               public apology.

219       In Hill v. Church of Scientology of Toronto, [1995] 2
S.C.R. 1130 (S.C.C.), a jury award of $300,000 for general damages
was upheld through appeals to the Supreme Court of Canada.

220       The defamation of the plaintiff by Cole was serious.  It
cannot be said however it was published in circumstances designed
to cause the most serious damage to the plaintiff's reputation and
to ensure the widest circulation possible.  The circumstance of
publication to Millar was to effect his business relationship with
a singular insurer.  It cannot be said in the circumstance further
publication was likely and certainly not "... the widest
circulation possible."

221       It is true that the apology given, even with the
widespread use made of it by the plaintiff, has not completely
alleviated the plaintiff's feelings.  It was a factor in
combination with many others resulting in the depressive condition
which still remains and has had a devastating effect upon him.  The
factors delineated in Hill v. Church of Scientology of Toronto are
useful to consideration of damage assessment but the weight in
respect of each individual factor requires considerable variation
because of factual differences.

222       I assess the compensatory damages to be $150,000 for
general and $50,000 for aggravated damages, being a total of
$200,000 for Cole's defamation of the plaintiff.

223       Ostler's several and varied defamations of the plaintiff
were indeed serious.  The immediate and unsolicited tirade of
defamatory comments made to Cpl. Didyck confirm his malicious
intent.  His statements clearly attributed criminal conduct to the
plaintiff and he was presenting this to an experienced police
officer who could be expected to act upon the information.  The
statements, apart from the plaintiff's criminal record and Pardon,
were totally untrue.

224       Ostler was making these statements of a person whom he
had met but once at a social function and could not recognize on
sight.  He could not help but appreciate the seriousness of his
allegations to the career of an insurance adjuster.  Further
evidence of his malicious motivation is his conversation with Burke
implying his involvement in an investigation of the plaintiff for
salvage impropriety.  The information was given in a casual manner,
on a drop-in basis, to a person who had no interest in the matter.
The same applies to the publication by Ostler to Mathison which
resulted in an almost immediate repetition to Burke.

225       In speaking to his employer, Cole did not report
involvement as off-handedly and flippantly as to others but was
structured so as to convey there was an investigation of the
plaintiff, the plaintiff and insured who sustained the loss knew
one another, and he was requested to assist in the investigation by
the police.  When Millar phoned him for confirmation of his
involvement in an investigation of the plaintiff he apparently
sensed a "set-up".  He did not however take the opportunity
presented to remove the suspicion and innuendo he had generated
regarding a police investigation of the plaintiff but chose to
confirm it.

226       I have accepted the plaintiff has shown Ostler was likely
the origin of some republication of defamatory rumour from the
several alleged in the plaintiff's pleadings, although he is not at
law responsible for the damage those republications caused.

227       Ostler has done nothing to try and rehabilitate the
plaintiff's reputation or lessen the damage he caused.  I assess
the compensatory damages to be $175,000 for general and $75,000 for
aggravated damages, being a total of $250,000 for Ostler's
defamation of the plaintiff.THIRD PARTY ACTIONS AGAINST MIKE TALBOT

228       The third party action of the defendants against Mike
Talbot is dismissed.  The third party is entitled to his costs on
scale 3.

229       The third party action fails as I have found the
plaintiff did not prove a liability of the defendants for the
republication of defamatory rumour.

230       The third party claim against Talbot derives from the
plaintiff's pleading against the defendants that Mike Talbot told
Chan, Bennett, and Lyndon, all co-employees of his at Canadian
Northern Shield, of a rumour he had heard that the plaintiff was
involved in the improper handling of an insurance claim, pocketing
of salvage proceeds and was also under investigation for cocaine
trafficking.  He also told Gary Daniels, an adjuster he believed to
be a friend of Brown, and asked that he speak to the plaintiff
about it.

231       I found Talbot to be an honest and straightforward
witness.  Had it been necessary to consider his defence of occasion
of qualified privilege in respect to his publication of the
defamatory works on the occasions in issue I would find he spoke
only on occasion of qualified privilege, as that concept is
conveniently outlined in Botiuk v. Toronto Free Press Publications
Ltd. (1995), 126 D.L.R. (4th) 609 (S.C.C.) at p.626.

232       In speaking to fellow employees he was not motivated by
malice, only by a sincere desire to convey information to persons
within his company who had a legitimate interest in hearing, and he
a corresponding duty to provide.  There was a proper business
interest and duty involved.

233       It would be unfair to Talbot to leave any inference he is
a person prone to gossip or the spread of rumour.  In speaking to
Daniels he was trying only to assist in bringing the matter to the
attention of the plaintiff by invoking the aid of a friend of the
plaintiff's that might assist to bring the matter to the
plaintiff's attention.  I consider in doing so he was in the
circumstances only fulfilling a proper moral or social obligation.

COSTS

234       So far as I am aware the plaintiff is entitled to his
taxed costs of this action on scale 3.




                                   "R.R. HOLMES J."

September 26, 1996
Vancouver, B.C.