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DEFAMATION - Defamatory statements - What constitutes defamatory words - Defences - Fair comment

Monday, May 28, 2018 @ 8:39 AM  


Appeal by the defendants, the Better Business Bureau, from an order allowing the plaintiffs' appeal from the dismissal of their defamation action and appeal by the plaintiff Walsh from the order for re-trial. The plaintiffs were in the heating and air conditioning business, providing services to residential customers. Until 2007, they were members of the Better Business Bureau, a not-for-profit organization that investigated consumer complaints and promoted the reliability of businesses. The defendants graded the plaintiff Walsh Energy a D-minus on their website due to an unresolved customer complaint. The plaintiff Waltek Energy received a B on their website. The plaintiffs sued, claiming that the publication was defamatory and caused substantial damages. The trial judge found that the impugned publication was not defamatory given its context. The trial judge further found that the publication was protected by the defences of fair comment and qualified privilege. He further concluded that the plaintiffs had not proven special damages and that general damages of $15,000 would have been sufficient had the plaintiff established liability. He awarded costs of $348,000 to the BBB. The plaintiffs appealed, but Waltek abandoned its appeal prior to the hearing. The Divisional Court allowed the appeal. It ordered the issues of fair comment, malice and damages other than lost profits should be remitted for determination by a new trial judge. The BBB appealed arguing that the Divisional Court erred by concluding that the impugned publication was defamatory, by concluding that the fair comment defence had not been established and ordering a new trial on that issue, by concluding that the impugned publication was not made on an occasion of qualified privilege and ordering a new trial on the question of malice, by acting in a procedurally unfair manner on the question of damages and by ordering a new trial on the question of damages. Walsh cross-appealed on the grounds that the record before the Divisional Court was sufficient for it to have substituted its own decision.

HELD: Appeal allowed and cross-appeal dismissed. The Divisional Court did not err in determining that the impugned publication was defamatory. The impugned words were published by the BBB and they were about Walsh. The D- grade was defamatory because it would tend to lower Walsh's reputation in the eyes of a reasonable person. The grade, in its ordinary meaning in the context in which it was written, meant that the BBB conducted a fair and impartial assessment and concluded that Walsh was not reliable or trustworthy. The Divisional Court erred in ordering a new trial on the issue of fair comment. The record was sufficient to permit the court to conclude that the test for fair comment was satisfied. The rating concerned a matter of public interest. The rating was a comment, easily recognizable as an opinion. The rating was based on facts. There was no evidence of malice. The BBB made it clear that there was only one unanswered complaint against Walsh and there was no hidden agenda to force Walsh into the BBB's reconciliation process or membership. The trial judge's award of costs was so excessive as to require intervention. The costs were grossly disproportionate to the costs incurred by Walsh in bringing the action. An award of $175,000 was substituted.

Walsh Energy Inc. (c.o.b. The Energy Centre) v. Better Business Bureau of Ottawa-Hull Inc. (c.o.b. Better Business Bureau Serving Eastern and Northern Ontario and the Outaouais), [2018] O.J. No. 2104, Ontario Court of Appeal, A. Hoy A.C.J.O., G. Huscroft and D. Paciocco JJ.A., April 19, 2018. Digest No. TLD-May282018001