hill v. church of scientology

Morris Manning and
Church of Scientology of Toronto
Appellants

v.
S. Casey Hill



Respondent

and

Attorney General for Ontario, Canadian
Civil Liberties Association, Writers' Union
of Canada, PEN Canada, Canadian Association
of Journalists, Periodical Writers Association 
of Canada, Book and Periodical Council,
Canadian Daily Newspaper Association, Canadian
Community Newspapers Association, Canadian
Association of Broadcasters, Radio-Television 
News Directors Association of Canada, Canadian
Book Publishers' Council and Canadian Magazine
Publishers' Association
Interveners

Indexed as:  Hill v. Church of Scientology of Toronto

File No.:  24216.

1995:  February 20; 1995:  July 20.




Present:  La Forest, L'Heureux-Dube, Gonthier, Cory, McLachlin, Iacobucci and 
Major JJ.

on appeal from the court of appeal for ontario

SYNOPSI*****INDEX

I.  Factual Background
  2

(A)
The "Enemy Canada" File
  8

(B)
The Press Conference
  9

(C)
The Felske Memorandum
 10

(D)
The Contempt Trial
 11

(E)
The Attempt to Disqualify Casey Hill from the Search and 
Seizure Proceedings
 13

(F)
Pleas of Justification
 14

(G)
The Conduct of Scientology at Trial
 15



(1)
The Cross-Examination of Casey Hill
 15



(2)
The "Veiled Threat" Against Clayton Ruby
 16



(3)
The Closing Address to the Jury by Counsel for 
Scientology
 17

(H)
The Events Following the Verdict of the Jury
 17

II.  Judgments Below
 18

(A)
Trial by Jury (Carruthers J. presiding)
 18

(B)
Court of Appeal
 20

III.  Analysis
 23

(A)
Application of the Charter
 24



(1)  Section 32:  Government Action
 25



(2)
Section 52:  Charter Values and the Common 
Law
 31




(a)
Interpretating the Common Law in Light 
of the Values Underlying the Charter
 31





(i)
Review of the Decisions Dealing 
With the Issue
 31





(ii)
Approach that Should be 
Followed
 37




(b)
The Nature of Actions for Defamation:  
The Values to Be Balanced
 40





(i)
Freedom of Expression
 41





(ii)
The Reputation of the Individual
 44




(c)
The Proposed Remedy:  Adopting the 
New York Times v. Sullivan "Actual 
Malice" Rule
 50




(d)
Critiques of the "Actual Malice" Rule
 52





(i)
Comments on the Decision in the 
United States
 52





(ii)
Consideration of the Actual 
Malice Rule in the United 
Kingdom
 56





(iii)
The Australian Position on 
Actual Malice
 56





(iv)
The Position Taken By 
International Law Reform 
Commissions
 57




(e)
Conclusion:  Should the Law of 
Defamation be Modified by 
Incorporating the Sullivan Principle?
 58




(f)
Should the Common Law Defence of 
Qualified Privilege be Expanded to 
Comply with Charter values?
 60

(B)  Damages
 66



(1)
The Standard of Appellate Review
 66



(2)
General Damages
 69




(a)
Should a Cap be Imposed on Damages 
in Defamation Cases
 70




(b)
Joint Liability for General Damages
 73




(c)
Application of Principles to the Facts 
Established in this Case
 74




(d)
Comparison with Other Libel Cases
 79



(3)
Aggravated Damages
 80




(a)
General Principles
 80




(b)
The Application to the Facts of this Case
 82



(4)
Punitive Damages
 84




(a)
General Principles
 84




(b)
The Application to the Facts of this Case
 85

IV.  Disposition
 87






Constitutional law -- Charter of Rights -- Application -- Libel and slander 
-- Church of Scientology commencing criminal contempt proceedings against Crown 
attorney -- Church's counsel and representatives holding press conference on 
courthouse steps -- Counsel reading from and commenting on allegations in contempt 
motion -- Contempt allegations subsequently found to be untrue -- Crown attorney 
bringing action for damages in libel -- Whether Crown attorney's action for damages 
"government action" -- Whether Charter applies -- Canadian Charter of Rights and 
Freedoms, s. 32(1).


Libel and slander -- Common law of defamation -- Canadian Charter of 
Rights and Freedoms -- Whether common law of defamation complies with values 
underlying Charter -- Whether "actual malice" rule should be adopted.


Libel and slander -- Defences -- Qualified privilege -- Church of 
Scientology commencing criminal contempt proceedings against Crown attorney -- 
Church's counsel and representatives holding press conference on courthouse steps -- 
Counsel reading from and commenting on allegations in contempt motion -- Contempt 
allegations subsequently found to be untrue -- Crown attorney bringing action for 
damages in libel -- Whether defence of qualified privilege available.


Libel and slander -- Damages -- General damages -- Aggravated 
damages -- Punitive damages -- Church of Scientology commencing criminal contempt 
proceedings against Crown attorney -- Church's counsel and representatives holding 
press conference on courthouse steps -- Counsel reading from and commenting on 
allegations in contempt motion -- Contempt allegations subsequently found to be 
untrue -- Crown attorney bringing action for damages in libel -- Counsel and Church 
found jointly liable for general damages -- Church found liable for aggravated and 
punitive damages -- Whether cap should be imposed on general damages in 
defamation cases -- Whether damage awards should stand.


The appellant M, accompanied by representatives of the appellant 
Church of Scientology, held a press conference on the courthouse steps.  M, who was 
wearing his barrister's gown, read from and commented upon allegations contained in a 
notice of motion by which Scientology intended to commence criminal contempt 
proceedings against the respondent, a Crown attorney.  The notice of motion alleged 
that the respondent had misled a judge and had breached orders sealing certain 
documents belonging to Scientology.  The remedy sought was the imposition of a fine 
or his imprisonment.  At the contempt proceedings, the allegations against the 
respondent were found to be untrue and without foundation.  He thereupon 
commenced an action for damages in libel against the appellants.  Both appellants 
were found jointly liable for general damages in the amount of $300,000 and 
Scientology alone was found liable for aggravated damages of $500,000 and punitive 
damages of $800,000.  This judgment was affirmed by the Court of Appeal.  The 
major issues raised in this appeal are whether the common law of defamation is 
consistent with the Canadian Charter of Rights and Freedoms and whether the jury's 
award of damages can stand.


Held:  The appeal should be dismissed.


Per La Forest, Gonthier, Cory, McLachlin, Iacobucci and Major JJ.: The 
respondent's action for damages does not constitute government action within the 
meaning of s. 32 of the Charter.  The fact that persons are employed by the 
government does not mean that their reputation is automatically divided into two 
parts, one related to their personal life and the other to their employment status.  
Reputation is an integral and fundamentally important aspect of every individual; it 
exists for everyone quite apart from employment.  The appellants impugned the 
character, competence and integrity of the respondent himself, and not that of the 
government.  He, in turn, responded by instituting legal proceedings in his own 
capacity.  There was no evidence that the Ministry of the Attorney General or the 
Government of Ontario required or even requested him to do so.  Neither is there any 
indication that the Ministry controlled the conduct of the litigation in any way.  The 
fact that the respondent's suit may have been funded by the Ministry does not alter 
his constitutional status or cloak his personal action in the mantle of government 
action.  Further, even if there were sufficient government action to bring this case 
within s. 32, the appellants failed to provide any evidentiary basis upon which to 
adjudicate their constitutional attack.


The common law must be interpreted in a manner which is consistent 
with Charter principles.  This obligation is simply a manifestation of the inherent 
jurisdiction of the courts to modify or extend the common law in order to comply 
with prevailing social conditions and values.  In its application to the parties in this 
action, the common law of defamation complies with the underlying values of the 
Charter and there is no need to amend or alter it.  The common law strikes an 
appropriate balance between the twin values of reputation and freedom of expression. 
 The protection of reputation is of vital importance, and consideration must be given 
to the particular significance reputation has for a lawyer.  Although it is not 
specifically mentioned in the Charter, the good reputation of the individual represents 
and reflects the innate dignity of the individual, a concept which underlies all the 
Charter rights.  Further, reputation is intimately related to the right to privacy, which 
has been accorded constitutional protection.  The "actual malice" rule should not be 
adopted in Canada in an action between private litigants.  The law of defamation is 
not unduly restrictive or inhibiting.  Freedom of speech, like any other freedom, is 
subject to the law and must be balanced against the essential need of individuals to 
protect their reputation.


Qualified privilege attaches to the occasion upon which the 
communication is made, and not to the communication itself.  The legal effect of the 
defence of qualified privilege is to rebut the inference, which normally arises from the 
publication of defamatory words, that they were spoken with malice.  Where the 
occasion is shown to be privileged, the bona fides of the defendant is presumed and 
the defendant is free to publish, with impunity, remarks which may be defamatory 
and untrue about the plaintiff.  The privilege is not absolute, however, and can be 
defeated if the dominant motive for publishing the statement is actual or express 
malice.  Malice is commonly understood, in the popular sense, as spite or ill-will.  
However, it also includes any indirect motive or ulterior purpose that conflicts with 
the sense of duty or the mutual interest which the occasion created.  Malice may also 
be established by showing that the defendant spoke dishonestly, or in knowing or 
reckless disregard for the truth.  Qualified privilege may also be defeated when the 
limits of the duty or interest have been exceeded.  The fact that an occasion is 
privileged does not necessarily protect all that is said or written on that occasion.  The 
information communicated must be reasonably appropriate in the context of the 
circumstances existing on the occasion when that information was given.


The traditional common law rule with respect to reports on documents 
relating to judicial proceedings is that, where there are judicial proceedings before a 
properly constituted judicial tribunal exercising its jurisdiction in open court, then the 
publication without malice of a fair and accurate report of what takes place before that 
tribunal is privileged.  However, the common law immunity was not extended to a 
report on pleadings or other documents which had not been filed with the court or 
referred to in open court.  Prior to holding the press conference M had every intention 
of initiating the contempt action in accordance with the prevailing rules, and had given 
instructions to this effect.  The fact that the proper documents were not filed until the 
next morning should not defeat the qualified privilege which attached to this occasion. 
 M's conduct, however, far exceeded the legitimate purposes of the occasion.  The 
circumstances of this case called for great restraint in the communication of 
information concerning the proceedings launched against the respondent.  As an 
experienced lawyer, M ought to have taken steps to confirm the allegations that were 
being made.  This is particularly true since he should have been aware of the 
Scientology investigation pertaining to access to the sealed documents.  In those 
circumstances he was duty bound to wait until the investigation was completed before 
launching such a serious attack on the respondent's professional integrity.  M failed to 
take either of these reasonable steps.  As a result of this failure, the permissible scope 
of his comments was limited and the qualified privilege which attached to his remarks 
was defeated.  The press conference was held on the courthouse steps in the presence 
of representatives from several media organizations.  This constituted the widest 
possible dissemination of grievous allegations of professional misconduct that were 
yet to be tested in a court of law.  His comments were made in language that 
portrayed the respondent in the worst possible light.  This was neither necessary nor 
appropriate in the existing circumstances.  While it is not necessary to characterize 
M's conduct as amounting to actual malice, it was certainly high-handed and careless 
and exceeded any legitimate purpose the press conference may have served.  His 
conduct therefore defeated the qualified privilege that attached to the occasion.


When properly instructed, jurors are uniquely qualified to assess the 
damages suffered by the plaintiff.  An appellate court is not entitled to substitute its 
own judgment as to the proper award for that of the jury merely because it would 
have arrived at a different figure.  General damages in defamation cases are presumed 
from the very publication of the false statement and are awarded at large.  It is 
members of the community in which the defamed person lives who will be best able 
to assess the damages.  The jury as representative of that community should be free 
to make an assessment of damages which will provide the plaintiff with a sum of 
money that clearly demonstrates to the community the vindication of the plaintiff's 
reputation.  No cap should be placed on general damages for defamation.  First, the 
injury suffered by a plaintiff as a result of injurious false statements is entirely 
different from the non-pecuniary damages suffered by a plaintiff in a personal injury 
case.  Second, at the time the cap was placed on non-pecuniary damages in personal 
injury cases, their assessment had become a very real problem for the courts and for 
society as a whole, which is not the case with libel actions.  The award of $300,000 
by way of general damages was justified in this case.  Both appellants published the 
notice of motion.  All persons who are involved in the commission of a joint tort are 
jointly and severally liable for the damages caused by that tort, and it would thus be 
wrong in law to have a jury attempt to apportion liability for general damages 
between the joint tortfeasors.  The reports in the press were widely circulated and the 
television broadcast had a wide coverage.  The setting and the persons involved gave 
the coverage an aura of credibility and significance that must have influenced all who 
saw and read the accounts.  The misconduct of the appellants continued after the first 
publication.  Prior to the commencement of the hearing of the contempt motion, 
Scientology was aware that the allegations it was making against the respondent were 
false, yet it persisted with the contempt hearings, as did M.  At the conclusion of the 
hearings, both appellants were aware of the falsity of the allegations.  Nonetheless, 
when the libel action was instituted, the defence of justification was put forward by 
both of them.  Although M withdrew the plea of justification, this was only done in 
the week prior to the commencement of the trial itself, and Scientology did not 
withdraw its plea until the hearing of the appeal.  Finally, the manner in which the 
respondent was cross-examined by the appellants, coupled with the manner in which 
they presented their position to the jury, in light of their knowledge of the falsity of 
their allegations, are further aggravating factors to be taken into account.


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.  
If aggravated damages are to be awarded, there must be 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.  The factors that a jury may 
properly take into account in assessing aggravated damages include whether there was 
a withdrawal of the libellous statement made by the defendant and an apology 
tendered, 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 the libel was published.  In this case, there was ample evidence 
upon which the jury could properly base their finding of aggravated damages.  Every 
aspect of this case demonstrates the very real and persistent malice of Scientology.


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.  They 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.  Unlike compensatory damages, punitive 
damages are not at large, and consequently courts have a much greater scope and 
discretion on appeal.  The appellate review should be based upon the court's 
estimation as to whether the punitive damages serve a rational purpose, as they did in 
this case.  Further, the circumstances presented in this exceptional case demonstrate 
that there was such insidious, pernicious and persistent malice that the award for 
punitive damages cannot be said to be excessive.


Per L'Heureux-Dube J.:  Cory J.'s reasons were generally agreed with, 
except with respect to the scope of the defence of qualified privilege.  The common 
law of defamation, as it is applied to the parties in this action, is consistent with the 
values enshrined in the Charter.  There is accordingly no need to amend or alter it or, 
in particular, to adopt the "actual malice" rule.  The defence of qualified privilege, 
however, is not available with respect to reports of pleadings in purely private 
litigation upon which no judicial action has yet been taken.  The defence is available 
only with respect to reports of judicial proceedings.  While there is a right to publish 
details of judicial proceedings before they are heard in open court, such publication 
does not enjoy the protection of qualified privilege if it is defamatory.

Cases Cited

By Cory J.


Not followed:  New York Times v. Sullivan, 376 U.S. 254 (1964); 
referred to:  Edmonton Journal v. Alberta (Attorney General), [1989] 2 S.C.R. 1326; 
RWDSU v. Dolphin Delivery Ltd., [1986] 2 S.C.R. 573; McKinney v. University of 
Guelph, [1990] 3 S.C.R. 229; Nelles v. Ontario, [1989] 2 S.C.R. 170; Lavigne v. 
Ontario Public Service Employees Union, [1991] 2 S.C.R. 211; MacKay v. Manitoba, 
[1989] 2 S.C.R. 357; B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2 
S.C.R. 214; R. v. Swain, [1991] 1 S.C.R. 933; R. v. Salituro, [1991] 3 S.C.R. 654; 
Dagenais v. Canadian Broadcasting Corp., [1994] 3 S.C.R. 835; B.C.G.E.U. v. 
British Columbia (Attorney General), [1983] 6 W.W.R. 640; R. v. Oakes, [1986] 1 
S.C.R. 103; Sweeney v. Patterson, 128 F.2d 457 (1942), cert. denied 317 U.S. 678 
(1942); Reference re Alberta Statutes, [1938] S.C.R. 100; Switzman v. Elbling, [1957] 
S.C.R. 285; Boucher v. The King, [1951] S.C.R. 265; Cherneskey v. Armdale 
Publishers Ltd., [1979] 1 S.C.R. 1067; United States of America v. Cotroni, [1989] 1 
S.C.R. 1469; R. v. Keegstra, [1990] 3 S.C.R. 697; R. v. Butler, [1992] 1 S.C.R. 452; 
Globe & Mail Ltd. v. Boland, [1960] S.C.R. 203; Derrickson v. Tomat (1992), 88 
D.L.R. (4th) 401; De Libellis Famosis (1605), 5 Co. Rep. 125a, 77 E.R. 250; King v. 
Lake (1670), Hardres 470, 145 E.R. 552; Rosenblatt v. Baer, 383 U.S. 75 (1966); 
Vogel v. Canadian Broadcasting Corp., [1982] 3 W.W.R. 97; R. v. Dyment, [1988] 2 
S.C.R. 417; Barr v. Matteo, 360 U.S. 564 (1959); Dun & Bradstreet, Inc. v. 
Greenmoss Builders, Inc., 472 U.S. 749 (1985); Coughlin v. Westinghouse 
Broadcasting & Cable, Inc., 476 U.S. 1187 (1986); Derbyshire County Council v. 
Times Newspapers Ltd., [1993] 1 All E.R. 1011; Theophanous v. Herald and Weekly 
Times Ltd. (1994), 124 A.L.R. 1; Silkin v. Beaverbrook Newspapers Ltd., [1958] 1 
W.L.R. 743; Adam v. Ward, [1917] A.C. 309; McLoughlin v. Kutasy, [1979] 2 S.C.R. 
311; Horrocks v. Lowe, [1975] A.C. 135; Taylor v. Despard, [1956] O.R. 963; 
Netupsky v. Craig, [1973] S.C.R. 55; Douglas v. Tucker, [1952] 1 S.C.R. 275; Sun 
Life Assurance Co. v. Dalrymple, [1965] S.C.R. 302; Gazette Printing Co. v. Shallow 
(1909), 41 S.C.R. 339; Canadian Newspapers Co. v. Canada (Attorney General), 
[1988] 2 S.C.R. 122; Walker v. CFTO Ltd. (1987), 59 O.R. (2d) 104; Rantzen v. 
Mirror Group Newspapers (1986) Ltd., [1993] 4 All E.R. 975; Ley v. Hamilton 
(1935), 153 L.T. 384; Andrews v. Grand & Toy Alberta Ltd., [1978] 2 S.C.R. 229; 
Arnold v. Teno, [1978] 2 S.C.R. 287; Thornton v. Board of School Trustees of School 
District No. 57 (Prince George), [1978] 2 S.C.R. 267; Jill Fishing Ltd. v. Koranda 
Management Inc., [1993] B.C.J. No. 1861 (QL); Cassell & Co. v. Broome, [1972] 1 
All E.R. 801; Blackshaw v. Lord, [1984] 2 All E.R. 311; Sutcliffe v. Pressdram Ltd., 
[1990] 1 All E.R. 269; Carson v. John Fairfax & Sons Ltd. (1993), 113 A.L.R. 577; 
Lawson v. Burns, [1976] 6 W.W.R. 362; Kerr v. Conlogue (1992), 65 B.C.L.R. (2d) 
70; Egger v. Chelmsford, [1965] 1 Q.B. 248.

By L'Heureux-Dube J.


Not followed:  New York Times v. Sullivan, 376 U.S. 254 (1964); 
referred to:  RWDSU v. Dolphin Delivery Ltd., [1986] 2 S.C.R. 573; R. v. Salituro, 
[1991] 3 S.C.R. 654; Dagenais v. Canadian Broadcasting Corp., [1994] 3 S.C.R. 835; 
R. v. Park, S.C.C., No. 23876, June 22, 1995; Gazette Printing Co. v. Shallow (1909), 
41 S.C.R. 339; Edmonton Journal v. Alberta (Attorney General), [1989] 2 S.C.R. 
1326.

Statutes and Regulations Cited

Act to amend the Court of Justice Act, 1984, S.O. 1989, c. 67, s. 4.

Canadian Charter of Rights and Freedoms, ss. 1, 2(b), 32.

Constitution Act, 1982, s. 52.

Courts of Justice Act, R.S.O. 1990, c. C.43.

Crown Attorneys Act, R.S.O. 1980, c. 107.

Criminal Code, R.S.C., 1985, c. C-46, s. 504.

Libel and Slander Act, R.S.O. 1990, c. L.12.

Ministry of the Attorney General Act, R.S.O. 1980, c. 271.

Authors Cited

Australia.   Law Reform Commission.  Report No. 11.  Unfair Publication:  
Defamation and Privacy.  Canberra:  Australian Government Publishing Service, 
1979.

Barrett, David A.  "Declaratory Judgments for Libel:  A Better Alternative" (1986), 
74 Cal. L. Rev. 847.

Barron, Jerome A.  "Access to the Press -- A New First Amendment Right" 
(1966-67), 80 Harv. L. Rev. 1641.

Bezanson, Randall P.  "Libel Law and the Realities of Litigation:  Setting the Record 
Straight" (1985), 71 Iowa L. Rev. 226.

Bollinger, Lee C.  "The End of New York Times v Sullivan:  Reflections on Masson v 
New Yorker Magazine", [1991] Sup. Ct. Rev. 1.

Brown, Raymond E.  The Law of Defamation in Canada, 2nd ed.  Scarborough, Ont.:  
Carswell, 1994 (loose-leaf).

Canadian Daily Newspaper Association.  Response to A Consultation Draft of the 
General Limitations Act (September 1991).

Carter-Ruck on Libel and Slander, 4th ed.  By Peter F. Carter-Ruck, Richard Walker 
and Harvey N. A. Starte.  London:  Butterworths, 1992.

Christie, George C.  "Injury to Reputation and the Constitution:  Confusion Amid 
Conflicting Approaches" (1976), 75 Mich. L. Rev. 43.

Epstein, Richard A.  "Was New York Times v. Sullivan Wrong?" (1986), 53 U. Chi. L. 
Rev. 782.

Gatley on Libel and Slander in a Civil Action:  With Precedents of Pleadings, 4th ed.  
By Richard O'Sullivan.  London:  Sweet & Maxwell, 1953.

Gatley on Libel and Slander, 8th ed.  By Philip Lewis.  London:  Sweet & Maxwell, 
1981.

Hawreluk, David.  "The Lawyer's Duty to Himself and the Code of Professional 
Conduct" (1993), 27 L. Soc. Gaz. 119.

Ireland.  Law Reform Commission.  Report on the Civil Law of Defamation.  Dublin:  
Law Reform Commission, 1991.

Lepofsky, David.  "Making Sense of the Libel Chill Debate:  Do Libel Laws "Chill" 
the Exercise of Freedom of Expression?" (1994), 4 N.J.C.L. 169.

Leval, Pierre N.  "The No-Money, No-Fault Libel Suit:  Keeping Sullivan in its 
Proper Place" (1988), 101 Harv. L. Rev. 1287.

Lewis, Anthony.  "New York Times v. Sullivan Reconsidered:  Time to Return to 
`The Central Meaning of the First Amendment'" (1983), 83 Colum. L. Rev. 603.

London, Martin.  "The `Muzzled Media':  Constitutional Crisis or Product Liability 
Scam?".  In At What Price?  Libel Law and Freedom of the Press.  New York:  
Twentieth Century Fund, 1993.

McLellan, Anne, and Bruce P. Elman.  "To Whom Does the Charter Apply?  Some 
Recent Cases on Section 32" (1986), 24 Alta. L. Rev. 361.

Salmond and Heuston on the Law of Torts, 19th ed.  By R. F. V. Heuston and 
R. A. Buckley.  London:  Sweet & Maxwell, 1987.

United Kingdom.  Report of the Committee on Defamation.  London:  H.M.S.O., 1975.

Veeder, Van Vechten.  "The History and Theory of the Law of Defamation" (1903), 3 
Colum. L. Rev. 546.

Waddams, S. M.  The Law of Damages, 2nd ed.  Toronto:  Canada Law Book, 1991 
(loose-leaf).


APPEAL from a judgment of the Ontario Court of Appeal (1994), 18 
O.R. (3d) 385, 114 D.L.R. (4th) 1, 71 O.A.C. 161, 20 C.C.L.T. (2d) 129, affirming a 
judgment of the Ontario Court of Justice (General Division) awarding the respondent 
damages for libel against the appellants.  Appeal dismissed.


Bryan Finlay, Q.C., and Christopher J. Tzekas, for the appellant Morris 
Manning.


Marc J. Somerville, Q.C., and R. Ross Wells, for the appellant the Church 
of Scientology of Toronto.


Robert P. Armstrong, Q.C., and Kent E. Thomson, for the respondent.


Lori Sterling and Hart Schwartz, for the intervener the Attorney General 
for Ontario.


Robert J. Sharpe and Kent Roach, for the intervener the Canadian Civil 
Liberties Association.


Edward M. Morgan, for the interveners the Writers' Union of Canada, 
PEN Canada, Canadian Association of Journalists, Periodical Writers Association of 
Canada, and Book and Periodical Council.


Peter W. Hogg and Brian MacLeod Rogers, for the interveners the 
Canadian Daily Newspaper Association, Canadian Community Newspapers 
Association, Canadian Association of Broadcasters, Radio-Television News Directors 
Association of Canada, Canadian Book Publishers' Council and Canadian Magazine 
Publishers' Association.


Solicitors for the appellant Morris Manning:  Weir & Foulds, Toronto.


Solicitors for the appellant the Church of Scientology of 
Toronto:  Gowling, Strathy & Henderson, Kitchener.


Solicitors for the respondent:  Tory Tory DesLauriers & Binnington, 
Toronto.


Solicitor for the intervener the Attorney General for Ontario:  The 
Ministry of the Attorney General, Toronto.


Solicitors for the intervener the Canadian Civil Liberties 
Association:  Robert Sharpe and Kent Roach, Toronto.


Solicitors for the interveners the Writers' Union of Canada, PEN Canada, 
Canadian Association of Journalists, Periodical Writers Association of Canada, and 
Book and Periodical Council:  Davies, Ward & Beck, Toronto.


Solicitors for the interveners the Canadian Daily Newspaper Association, 
Canadian Community Newspapers Association, Canadian Association of 
Broadcasters, Radio-Television News Directors Association of Canada, Canadian 
Book Publishers' Council and Canadian Magazine Publishers' Association:  Blake, 
Cassels & Graydon, Toronto.





PARAGRAPH NUMBERING

The paragraph numbering will now appear in the SCR.






CORY J.:

1 On September 17, 1984, the appellant Morris Manning, accompanied by 
representatives of the appellant Church of Scientology of Toronto ("Scientology"), 
held a press conference on the steps of Osgoode Hall in Toronto.  Manning, who was 
wearing his barrister's gown, read from and commented upon allegations contained in a 
notice of motion by which Scientology intended to commence criminal contempt 
proceedings against the respondent Casey Hill, a Crown attorney.  The notice of 
motion alleged that Casey Hill had misled a judge of the Supreme Court of Ontario 
and had breached orders sealing certain documents belonging to Scientology.  The 
remedy sought was the imposition of a fine or the imprisonment of Casey Hill.

2 At the contempt proceedings, the allegations against Casey Hill were found to be 
untrue and without foundation.  Casey Hill thereupon commenced this action for 
damages in libel against both Morris Manning and Scientology.  On October 3, 1991, 
following a trial before Carruthers J. and a jury, Morris Manning and Scientology 
were found jointly liable for general damages in the amount of $300,000 and 
Scientology alone was found liable for aggravated damages of $500,000 and punitive 
damages of $800,000.  Their appeal from this judgment was dismissed by a 
unanimous Court of Appeal:  (1994), 18 O.R. (3d) 385, 114 D.L.R. (4th) 1, 71 
O.A.C. 161, 20 C.C.L.T. (2d) 129.

I.  Factual Background

3 As in all actions for libel, the factual background is extremely important and must be 
set out in some detail.  At the time the defamatory statements were made, Casey Hill 
was employed as counsel with the Crown Law Office, Criminal Division of the 
Ministry of the Attorney General for the Province of Ontario.  He had given advice to 
the Ontario Provincial Police ("OPP") regarding a warrant obtained on March 1, 1983 
which authorized a search of the premises occupied by Scientology.  During the 
execution of the search warrant on March 3 and 4, 1983, approximately 250,000 
documents, comprising over 2 million pages of material, were seized.  These 
documents were stored in some 900 boxes at an OPP building in Toronto.

4 Immediately following the seizure, Scientology retained Clayton Ruby to bring a 
motion to quash the search warrant and to seek the return of the seized documents.  
Casey Hill, who had gained experience and special skill in the area of search and 
seizure, acted as counsel for the Crown.

5 The litigation commenced on March 7, 1983 and continued throughout 1983 and 
1984.  On July 11, 1984, Osler J. ruled that solicitor-and-client privilege applied to 
232 of the seized documents he had reviewed and ordered that they remain sealed 
pending further order of the court.  Several sealing orders and endorsements were 
ultimately made by Justices of the Supreme Court of Ontario.

6 Throughout this period, Casey Hill dealt frequently with Clayton Ruby and other 
counsel for Scientology in connection with various matters ranging from the trivial to 
the significant.  They were invariably resolved in a spirit of co-operation and 
professional courtesy, even in those situations where the parties proceeded with 
contested motions.

7 In March of 1983, Scientology retained Charles Campbell to make an application to 
Rosemarie Drapkin, the Deputy Registrar General of the Ministry of Consumer and 
Commercial Relations, requesting that its president, Earl Smith, be granted the 
authorization to solemnize marriages pursuant to s. 20(2) of the Marriage Act, R.S.O. 
1980, c. 256.  One year later, Scientology commenced an application for judicial 
review of Rosemarie Drapkin's failure to approve that application.

8 Rosemarie Drapkin believed that it would help her to assess the application if she 
could review the seized documents.  To that end, Kim Twohig, a solicitor in the Civil 
Division of the Crown Law Office, approached Casey Hill in July, 1984.  He advised 
her that there was a motion outstanding before Osler J. for an order quashing the 
search warrant and that access would only be granted if a court order was obtained 
pursuant to s. 490(15) (formerly 446(15)) of the Criminal Code, R.S.C., 1985, 
c. C-46.  He explained that there had been several interim rulings in this matter and 
stated that "this was probably the type of case where the judge hearing such an 
application would want notice given to Scientology".

9 During the last week of July 1984, Casey Hill travelled to Nassau to meet with the 
Attorney General of the Bahamas in respect of an ongoing criminal investigation.  In 
the course of a telephone conversation, Kim Twohig conveyed to Casey Hill the 
urgent need she had to gain access to the documents as a date had been fixed to hear 
Scientology's application for judicial review.  Casey Hill testified that he told Kim 
Twohig that her Criminal Code application would have to be served on the Crown 
Law Office, Criminal Division in the usual fashion to obtain its consent.

10 Kim Twohig prepared the necessary materials, including the notice of motion and an 
affidavit of Rosemarie Drapkin, and obtained the requisite consent from James 
Blacklock of the Crown Law Office, Criminal Division.  The application was then 
filed in Weekly Court on July 30, 1984 with the assistance of Jerome Cooper, a 
solicitor with the Ministry of Consumer and Commercial Relations.  No notice was 
given to Scientology.  The following day, a consent order granting access to all of the 
seized documents was issued by Sirois J. in chambers without submissions from 
counsel.

11 In her testimony at the trial of this action, Kim Twohig agreed that she alone made the 
decision not to provide notice to Scientology of her application. She testified that she 
assumed that the presiding judge would determine whether notice was necessary or 
appropriate.  It was only later that she realized that the order of Sirois J. might 
provide access to sealed documents.

12 By letter dated August 22, 1984, Rosemarie Drapkin wrote to Charles Campbell 
concerning Scientology's application and advised that she had "reviewed certain 
documents relating to the Scientology organization which were seized pursuant to the 
search warrant" issued on March 1, 1983.  Attached to the letter was a list of 89 
documents, some of which had purportedly been sealed by order of Osler J.  It was 
this information which raised the concern of Scientology and its legal advisers.

13 In response, Clayton Ruby wrote a somewhat precipitous and very aggressive letter 
to the Solicitor General of Ontario dated August 28.  In it he accused the OPP of 
acting "as if there were no rule of law" and of "simply ignoring solicitor/client privilege 
and making a mockery of the courts".  He called for a "full investigation" and 
demanded disciplinary action be taken "against everyone involved".  Clayton Ruby 
was not aware of the order of Sirois J. at that time.  He simply assumed that those 
involved had acted improperly.

14 As early as September 5, 1984, Clayton Ruby, along with other counsel and 
representatives of Scientology, decided that what had occurred was "disgraceful and 
shocking" and constituted contempt.  They arrived at this conclusion without having 
taken any steps to ensure the accuracy of their impressions.

15 In a letter addressed to Casey Hill dated September 6, 1984, Clayton Ruby asked for 
Casey Hill's assistance in obtaining information regarding the circumstances under 
which the order of Sirois J. had been granted and why Scientology had not received 
notice of the application.  He requested a response within five days.  It should be 
noted that at the time this letter was written, Clayton Ruby was a Bencher of the Law 
Society and Vice-Chairman of the Law Society's Discipline Committee.

16 The letter implied that there could be disciplinary proceedings brought before the Law 
Society of Upper Canada and that a contempt action might be instituted.  Not 
surprisingly, it was given serious consideration by Casey Hill and others at the 
Ministry of the Attorney General.  Hill sought the advice of his Director, Howard 
Morton.  Morton wrote a letter to Ruby stating that in light of the serious nature of 
the allegations, he would not be able to reply within the five-day period imposed by 
Ruby.

17 On September 6 and 7, 1984, Michael Code (then an associate of Clayton Ruby) 
telephoned Casey Hill, Jerome Cooper and Kim Twohig to find out how access to the 
privileged documents had been obtained.  They all conveyed a similar version of the 
past events and assured him that the sealed documents were not opened but rather 
that unsealed copies must have been examined.  Code conceded in cross-examination 
that everyone he spoke to was cooperative.

18 On September 11, 1984, however, without making any further inquiries and without 
awaiting the reply from Casey Hill and Howard Morton, Ruby retained the appellant 
Morris Manning to advise Scientology in respect of possible contempt proceedings.  
On September 13, 1984, representatives of Scientology met with Morris Manning, 
Charles Campbell, Clayton Ruby, Michael Code and an articling student at Ruby's 
office.  A decision was made to commence an application for criminal contempt 
against both Casey Hill and Jerome Cooper.  Morris Manning testified that a critical 
piece of information which prompted him to bring the contempt application was the 
characterization by Michael Code of Casey Hill's attitude during their conversation.  
Casey Hill had allegedly said that if the Church missed sealing all copies of the 
privileged documents it was "too bad".  In Morris Manning's opinion, this 
demonstrated a contemptuous attitude towards the court.  He reached this conclusion 
without ever speaking to Casey Hill or any of the others involved in the incident such 
as Rosemarie Drapkin, Kim Twohig, James Blacklock, Jerome Cooper or Detective 
Inspector Ormsby, the senior officer of the OPP responsible for the investigation of 
Scientology.  Nor had Morris Manning interviewed those representatives of 
Scientology who were directly involved in the sealing of the documents.

19 The evidence adduced at the contempt hearing clearly established that Casey Hill 
played no part in the application before Sirois J. and had nothing to do with the 
execution or filing of the consent on behalf of the Attorney General of Ontario.  In 
fact, he was only informed of any difficulties associated with the order of Osler J. in 
late August, 1984, when he received a telephone call from Detective Inspector 
Ormsby.  At that time, Ormsby advised him that Rosemarie Drapkin had attended at 
the OPP building in which the seized documents were held with the order of Sirois J., 
but that she was denied access to the sealed documents.  The sealed documents were 
never opened.  What Rosemarie Drapkin may have seen were unsealed copies of the 
sealed documents that were probably located in different boxes than the sealed 
originals.

20 Between September 13 and 17, 1984, Morris Manning prepared a notice of motion 
for the contempt application returnable in Weekly Court some time in early January 
1985.  During this time, he did not make any attempt to determine what was being 
done with the seized documents or to ascertain whether any continuing breach of 
privilege was occurring.

(A)  The "Enemy Canada" File

21 Long before he gave advice to the OPP in connection with the search and seizure of 
documents which took place on March 3 and 4, 1983, Casey Hill had become a target 
of Scientology's enmity. Over the years, he had been involved in a number of matters 
concerning Scientology's affairs.  As a result, it kept a file on him.  This was only 
discovered when the production of the file was ordered during the course of this 
action.  The file disclosed that from approximately 1977 until at least 1981, 
Scientology closely monitored and tracked Casey Hill and had labelled him an "Enemy 
Canada".  Casey Hill testified that from his experience, persons viewed by 
Scientology as its enemies were "subject to being neutralized".

(B)  The Press Conference

22 In the file of Charles Campbell there was a note dated September 10 or 11, 1984 
which made reference to a press conference to be held the following Monday, 
September 17, 1984.  It appears, then, that before it had even consulted Morris 
Manning, Scientology intended to call a press conference

23 The press conference was organized by Earl Smith. He contacted a number of media 
organizations, including CFTO-TV, CBC television and The Globe and Mail and 
invited them to the event which was to be held in front of Osgoode Hall.  Morris 
Manning was appearing on that day before the Court of Appeal in an unrelated matter 
and attended the press conference in his barrister's gown.

24 He testified that he answered a number of questions concerning the contempt 
proceedings and then, at the request of the media, read a passage from the notice of 
motion for the television cameras.  Copies of the notice of motion were distributed to 
the media along with a typewritten document, prepared by Scientology, entitled 
"Chronology of Events Leading to Contempt Motion".

25 The notice of motion in essence alleged that Casey Hill had participated in the 
misleading of Sirois J. and that he had participated in or aided and abetted others in 
the opening and inspection of documents which to his knowledge were sealed by 
Osler J.

26 On the evening of September 17, 1984, the CFTO broadcast was seen by an audience 
of approximately 132,000 people.  The text of the broadcast is set out in Appendix A 
to these reasons.  The CBC broadcast was seen by approximately 118,000 people.  
The text is found in Appendix B.  The following morning, an article appeared in The 
Globe and Mail entitled "Motion of Contempt Launched by Church".  
Approximately 108,000 copies of the edition containing this article were distributed.  
The article is reproduced in Appendix C.  All three publications repeated the 
allegations made in the notice of motion.

(C)  The Felske Memorandum

27 Patricia Felske is a Scientologist who had attended at the offices of the OPP on a 
regular basis since March, 1983 for the purpose of reviewing the seized materials and 
ensuring that the privileged documents were sealed.  Between August 29, 1984, and 
September 27, 1984, she, along with other representatives from Scientology, opened 
the sealed envelopes and verified their contents against photocopies of the documents 
that Rosemarie Drapkin had examined.  Their purpose was to determine whether Ms. 
Drapkin had been granted access to the restricted materials.

28 On September 17, 1984, the day of the press conference, the Scientology investigation 
was well advanced and neither then nor later was there any indication that Drapkin 
gained access to sealed documents.  Scientology and Manning nevertheless proceeded 
with the press conference before any conclusive findings had been made on this issue.

29 On November 2, 1984, Patricia Felske prepared a brief summary of her findings, 
entitled "Time Track Re:  Solicitor and Client Privileged Documents", which she sent 
to Clayton Ruby, Charles Campbell, Morris Manning and Diane Martin, another of 
Scientology's lawyers.  In it she concluded that "[t]here was no evidence to support 
any allegation that the sealed envelopes had been tampered with by the OPP" 
(emphasis added).

(D)  The Contempt Trial

30 The contempt trial was heard by Cromarty J. for 11 days beginning the next Monday, 
November 5, 1984.  Morris Manning and Charles Campbell had carriage of the 
proceedings on behalf of Scientology.  A number of witnesses were called by them, 
including Clayton Ruby, Michael Code, Kim Twohig, Rosemarie Drapkin, James 
Blacklock, Detective Inspector Ormsby and four other members of the OPP who had 
direct responsibility for the seized documents.

31 Following the presentation of Scientology's case, Cromarty J. dismissed the 
application on a motion for non-suit on December 7, 1984:  13 W.C.B. 231.  He held 
that there was no evidence that Casey Hill participated in any stage of the application 
made before Sirois J. or that he should have been aware of any need for further inquiry 
into Kim Twohig's actions.

32 From the contents of the Felske Memorandum, which only came to light at the trial of 
the present action, it is evident that prior to the start of the contempt hearing, 
Scientology was well aware that no sealed envelopes had been opened.  Yet, it still 
proceeded with a contempt prosecution against Casey Hill.

33 Morris Manning testified that he never received the Felske Memorandum and 
conceded that if he had been aware of it, he would have been obliged to disclose it to 
Casey Hill.  However, on the weekend prior to the start of the contempt trial, Morris 
Manning was briefed by Charles Campbell.  At trial, both Campbell and Ruby 
acknowledged that they had received the Felske Memorandum.  In addition, Campbell 
testified that all important information concerning the prosecution was shared with 
everybody involved.  It might be inferred that this would include Manning.

34 Further, Morris Manning met with Patricia Felske and two other representatives of 
Scientology during the weekend prior to the hearing of the contempt motion.  
However, he testified that they were not interviewed for the purpose of giving 
evidence at the contempt trial nor were they called to do so.  Cromarty J. 
characterized the failure to call these individuals as "a most eloquent omission".

35 There was another equally eloquent omission.  The OPP officers who were called by 
Scientology to testify were not asked to produce the sealed envelopes they were 
directed to bring with them to court.  If they had, it would have been obvious that the 
envelopes had not been tampered with.

(E)
The Attempt to Disqualify Casey Hill from the Search and Seizure 
Proceedings

36 As stated earlier, Scientology made an application in March 1983 to quash the search 
warrant which the OPP had used to seize its documents.  This application was 
commenced before Osler J. prior to September 17, 1984, but was adjourned until the 
completion of the contempt proceedings.  Throughout this time, Casey Hill 
represented the Crown as lead counsel.

37 The application was resumed on December 18, 1984.  By that time, the contempt 
charges had been dismissed as unfounded and this libel action had been commenced.  
Casey Hill continued to represent the Crown but made a full disclosure of all the 
relevant circumstances to Osler J.  He submitted that the proceedings involved the 
interpretation and application of legal principles rather than the exercise of 
prosecutorial discretion and, as a consequence, his ability to act as responding counsel 
was not impaired.

38 Scientology, nevertheless, moved to disqualify Casey Hill on the ground that 
occasions might arise where he would have to exercise a discretion as to the 
production of a document and as to the significance to be attached to it.  Scientology 
contended that this could reflect adversely upon it and, in due course result in a 
favourable consideration of Casey Hill's libel suit.  Scientology was essentially 
suggesting that Casey Hill would use his position as Crown counsel to further his 
private interests.  This was a serious attack on his professional integrity which added 
to the sting of the libel uttered to that point.

39 Osler J. emphatically rejected these arguments.  He stated that it was fundamentally 
important for the Crown "to proceed courageously in the face of threats and attempts 
at intimidation or in the face of proceedings that have been found to be groundless but 
have obviously had the effect of harassment".

(F)  Pleas of Justification

40 On February 18, 1985, Scientology delivered its statement of defence in this action.  
Notwithstanding the findings contained in the Felske Memorandum prepared by its 
own members, and the conclusion reached by Cromarty J. in the contempt hearing, 
Scientology entered a plea of justification.

41 Scientology also put forward as true an allegation that Casey Hill directed and 
supervised the OPP in the opening and reviewing of 20 boxes of documents which had 
been sealed by order of Linden J.  This was found by the Court of Appeal to 
constitute a separate allegation of contempt and a further attack upon the integrity of 
Casey Hill in the performance of his duties as Crown counsel.

42 Scientology maintained its plea of justification throughout the trial and did not 
withdraw it until the first day of the hearing before the Court of Appeal on 
December 6, 1993, some nine years after the original libel.

43 Morris Manning delivered his statement of defence on April 1, 1985, and also 
asserted a plea of justification which he did not withdraw until the week prior to the 
commencement of the trial.  He persisted in this plea despite the decision of 
Cromarty J. dismissing the motion to commit Casey Hill for contempt and despite the 
overwhelming evidence indicating that the allegations made against Hill were false.

(G)  The Conduct of Scientology at Trial

44 Scientology continued its attack against Casey Hill throughout the trial of this action, 
both in the presence of the jury and in its absence.  More than once, it reiterated the 
libel even though it knew that these allegations were false.  Clearly, it sought to 
repeatedly attack Casey Hill's moral character.  Some examples are set out below.


(1)
The Cross-Examination of Casey Hill

45 Counsel for Scientology subjected Casey Hill to a lengthy cross-examination which 
the Court of Appeal correctly described as a "skilful and deliberate attempt at 
character assassination" (p. 452 O.R.).  Counsel suggested that Casey Hill often 
improperly coached his witnesses and took the same approach with respect to his 
own testimony at the libel trial.  It was insinuated that Casey Hill was an 
untrustworthy person who would breach his undertakings as he had done in this case 
in relation to the sealed documents.  Attempts were also made to blame him for the 
failure to give notice to Scientology concerning the application before Sirois J. even 
though he had been vindicated seven years earlier by Cromarty J.


(2)
The "Veiled Threat" Against Clayton Ruby

46 Michael Code testified that during the course of his conversation with Casey Hill on 
September 6, 1984, the latter had made a veiled threat against Clayton Ruby which he 
described in the following terms:


He [Casey Hill] suggests we may receive an ominous reply to Clay's 
complaints.  He is awaiting a report back from the police.  What he said to 
me was something to the effect that there was a police investigation of 
Mr. Ruby's conduct and basically, you better watch it.  [Emphasis 
added.]

47 When Casey Hill was called in reply, he denied making any such threat or using the 
word "ominous" during the conversation.  Rather, he testified that he had used the 
word "omnibus" in reference to a combined reply to the letters that Ruby sent to the 
Solicitor General and to himself.

48 In cross-examination, counsel for Scientology accused Casey Hill of fabricating this 
version of events.  Not only did counsel suggest that Hill had lied on the stand, but 
the general tenor of his questioning implied that Hill was so unprincipled that he 
would use the power of the state to intimidate an opposing lawyer.


(3)
The Closing Address to the Jury by Counsel for Scientology

49 During his closing address, counsel for Scientology contended that Casey Hill had 
demonstrated feigned and insincere emotion when he described his reaction to seeing 
the publication of the CFTO broadcast on the evening of September 17, 1984.  He 
suggested to the jury that it may have been nothing more than a "skilled performance 
to tug at your heartstrings" in order to influence the verdict.

(H)  The Events Following the Verdict of the Jury

50 The day after the jury's verdict, on October 4, 1991, Scientology republished the libel 
in a press release delivered to the media.  A few weeks later, it issued another press 
release attacking the verdict of the jury as "outrageous" and "so exorbitant and so 
grossly out of proportion that it was influenced more by L.A. Law than Canadian legal 
tradition".  Shortly thereafter, it proceeded with a motion before Carruthers J. to 
adduce evidence which, it contended, would bear "directly on the credibility and 
reputation of the plaintiff S. Casey Hill".  That motion was later withdrawn.

II.  Judgments Below

(A)  Trial by Jury (Carruthers J. presiding)

51 This action for damages for libel was commenced on December 14, 1984.  The trial 
before Carruthers J. and a jury lasted from September 3, 1991, until October 3, 1991.  
The questions posed to the jury and their answers were as follows:


SPECIAL VERDICT


Questions


A.  With Respect to the Defendant, Morris Manning


1.  Did the CBC broadcast refer to the plaintiff?


A.  Yes


2.  Did Morris Manning instruct, authorize or consent to the publication 
of the Notice of Motion at the press conference?


A.  Yes


B.  With Respect to Both Defendants


3.  Are the words complained of in the CFTO and CBC broadcasts on 
September 17, 1984, the Globe & Mail article on September 18, 1984, and 
the Notice of Motion defamatory of the plaintiff?


A.  Yes


4.  If the answer to Question 3 is "yes", what general damages, if any, is 
the plaintiff, Casey Hill, entitled to from the defendants, The Church of 
Scientology of Toronto and Morris Manning?


A.  $300,000


5.  If your answer to Question 3 is "yes", is he entitled to any aggravated 
damages from the defendant, Morris Manning, in addition to any general 
damages already assessed, and if so, in what amount?


A.  Nil


6.  If your answer to Question 3 is "yes", is he entitled to any aggravated 
damages from the defendant, The Church of Scientology of Toronto, in 
addition to any general damages already assessed, and if so, in what 
amount?


A.  $500,000


7.  If your answer to Question 3 is "yes", is he entitled to any punitive 
damages from the defendant, The Church of Scientology of Toronto, and 
if so, in what amount?


A.  $800,000

52 Following the verdict, the appellants made a motion before Carruthers J. requesting 
that he completely disregard the jury's assessment of damages because it was 
"outrageous, exorbitant and entirely out of proportion to the sting of the defamation" 
((1992), 7 O.R. (3d) 489, at p. 497).  Carruthers J. concluded that the jury was 
properly instructed as to the object and purpose of each head of damage and that 
there was evidence upon which the jury could have reached a conclusion that it was 
entitled to award damages under each of the three heads.

53 Carruthers J. refused to "invade the province of the jury" in order to make his own 
assessment of the damages (at p. 502).  He noted that since both defendants 
vigorously opposed each of the several motions on behalf of the plaintiff to discharge 
the jury, it was not open to them to suggest that he fix damages himself.

(B)  Court of Appeal (1994), 18 O.R. (3d) 385

54 The Court of Appeal, in its careful and extensive reasons rejected the appellants' 
allegation that the common law of defamation violated s. 2(b) of the Canadian 
Charter of Rights and Freedoms.  It did so for two reasons.  First, the court held that 
it was nothing more than a "bare assertion" of unconstitutionality which could not 
support their constitutional challenge (at p. 414).  Second, the court held that even if 
the constitutional challenge could be resolved in the absence of an evidentiary 
foundation, the appellants failed to show that the action for damages commenced by 
Casey Hill was a form of "government action" which was necessary in order to attract 
the application of the Charter.  The court rejected the argument that Casey Hill's 
position as a public figure implicated the government in whatever action he pursued.  
It also dismissed the submission that the government funding of his action was 
relevant to this question.

55 The Court of Appeal then considered the argument that interpreting the common law 
in a manner consistent with the Charter required the adoption of the "actual malice" 
standard of liability set out in the reasons of the U.S. Supreme Court in New York 
Times v. Sullivan, 376 U.S. 254 (1964).  There, Brennan J. held that public officials 
could only collect damages for statements concerning their fitness for office in 
circumstances where they could demonstrate that the defamatory statement was made 
"with knowledge that it was false or with reckless disregard of whether it was false or 
not" (p. 280).  After noting that the common law concept of malice involves an 
assessment of different factors, such as animosity, hostility, ill will and spite, the 
court concluded that the adoption of the rule in New York Times v. Sullivan, supra, 
would result in a major change to the common law that was neither necessary nor 
merited.  It found that the existing rule was historically based on sound policy reasons 
which recognized the importance of the protection of the reputation of individuals 
who assume the responsibilities of public officials.

56 The appellants also submitted that the trial judge erred in ruling that the circumstances 
of the press conference did not constitute an occasion of qualified privilege and in 
declining to charge the jury with respect to that defence.  The Court of Appeal found 
that under the common law, qualified privilege attached only to the publication of 
documents read or referred to in open court.  It was opposed to conferring a privilege 
on a press conference held for the purpose of disseminating to the public details of a 
pending legal proceeding at a time when no document in connection with that legal 
proceeding had yet been filed in any court office.  In rejecting the argument that this 
Court's judgment in Edmonton Journal v. Alberta (Attorney General), [1989] 2 S.C.R. 
1326, superseded the common law rule, the court stated that, while there is a right to 
publish details of judicial proceedings before they are heard in open court, "such 
publication does not enjoy the protection of qualified privilege if it is defamatory" 
(p. 427).

57 On the subject of general damages, the Court of Appeal examined the libellous 
statement, the circumstances of its publication and its effect on Casey Hill.  It found 
that "[t]he false statements can be seen as little short of allegations of a criminal 
breach of trust" (p. 437), "calculated to engender in the minds of those who learned of 
[them] that they were very serious and entirely credible" (p. 438).  Accordingly, they 
justified a very substantial award of general damages to compensate Casey Hill for the 
damage to his reputation and the injury to his feelings.  This, it was held, should be 
the result even though he had received several promotions and appointments by the 
time of trial.

58 With respect to aggravated damages, the Court of Appeal examined the circumstances 
existing prior to, at the time of and following the publication of the libel.  It concluded 
that the jury was entitled to find that its award for general damages was not large 
enough to provide adequate solatium to Casey Hill for the aggravation of his injury 
which was caused by the Scientology's malicious libel and reprehensible conduct.

59 The court then turned its attention to the issue of punitive damages and concluded as 
follows at p. 459:



What the circumstances of this case demonstrated beyond 
peradventure to the jury was that Scientology was engaged in an 
unceasing and apparently unstoppable campaign to destroy Casey Hill 
and his reputation.  It must have been apparent to the jury that a very 
substantial penalty was required because Scientology had not been 
deterred from its course of conduct by a previous judicial determination 
that its allegations were unfounded nor by its own knowledge that its 
principal allegation [that the sealed documents had been opened] was 
false.

60 The court also observed that it would not interfere with the award of punitive 
damages on the ground that Scientology persisted in its attack on Casey Hill's 
reputation even after the jury's verdict.

61 On the question of pre-judgment interest, the court concluded that since the 
appellants had accommodated counsel for Casey Hill in order to permit him to 
participate in a Royal Commission, it would be unfair to charge them with 
prejudgment interest for this period.  Also, in considering whether Morris Manning 
should bear an equal portion of the costs of the trial with Scientology, the court 
pointed out that much of the trial was devoted to the plea of justification pursued by 
Scientology alone.  Furthermore, the majority of the damages were awarded against 
Scientology.  Therefore, the court concluded that the trial costs should be 
apportioned, with Morris Manning paying only 30 percent of the assessed costs and 
Scientology the balance.  However, it added that the parties should remain jointly and 
severally liable for all costs with each having a claim-over against the other for any 
amount paid beyond their apportioned liability.

III.  Analysis

62 Two major issues are raised in this appeal.  The first concerns the constitutionality of 
the common law action for defamation.  The second relates to the damages that can 
properly be assessed in such actions.

63 Let us first review the appellants' submissions pertaining to defamation actions.  The 
appellants contend that the common law of defamation has failed to keep step with 
the evolution of Canadian society.  They argue that the guiding principles upon which 
defamation is based place too much emphasis on the need to protect the reputation of 
plaintiffs at the expense of the freedom of expression of defendants.  This, they say, 
is an unwarranted restriction which is imposed in a manner that cannot be justified in 
a free and democratic society.  The appellants add that if the element of government 
action in the present case is insufficient to attract Charter scrutiny under s. 32, the 
principles of the common law ought, nevertheless, to be interpreted, even in a purely 
private action, in a manner consistent with the Charter.  This, the appellants say, can 
only be achieved by the adoption of the "actual malice" standard of liability 
articulated by the Supreme Court of the United States in the case of New York Times 
v. Sullivan, supra.

64 In addition, the appellant Morris Manning submits that the common law should be 
interpreted so as to afford the defence of qualified privilege to a lawyer who, acting on 
behalf of a client, reads and comments in public upon a notice of motion which he 
believes, in good faith, has been filed in court, and which subsequently is filed.  Let us 
consider first whether the Charter is directly applicable to this case.

(A)  Application of the Charter

65 The appellants have not challenged the constitutionality of any of the provisions of 
the Libel and Slander Act, R.S.O. 1990, c. L.12.  The question, then, is whether the 
common law of defamation can be subject to Charter scrutiny.  The appellants submit 
that by reason of his position as a government employee, Casey Hill's action for 
damages constitutes "government action" within the meaning of s. 32 of the Charter.  
In the alternative, the appellants submit that, pursuant to s. 52, the common law must 
be interpreted in light of Charter values.  I will address the s. 32 argument first.


(1)  Section 32:  Government Action

66 Section 32(1) reads:


32. (1)  This Charter applies



(a)  to the Parliament and government of Canada in respect of all 
matters within the authority of Parliament including all matters 
relating to the Yukon Territory and Northwest Territories; and



(b)  to the legislature and government of each province in respect of 
all matters within the authority of the legislature of each province.

67 In RWDSU v. Dolphin Delivery Ltd., [1986] 2 S.C.R. 573, McIntyre J., with regard to 
the application of the Charter to the common law, stated at pp. 598-99:



It is my view that s. 32 of the Charter specifies the actors to whom 
the Charter will apply.  They are the legislative, executive and 
administrative branches of government.  It will apply to those branches of 
government whether or not their action is invoked in public or private 
litigation.  . . .  It will apply to the common law, however, only in so far 
as the common law is the basis of some governmental action which, it is 
alleged, infringes a guaranteed right or freedom.  [Emphasis added.]

68 La Forest J., writing for the majority in McKinney v. University of Guelph, [1990] 3 
S.C.R. 229, stressed the importance of this limitation on the application of the 
Charter to the actions of government.  He said this at p. 262:



The exclusion of private activity from the Charter was not a result of 
happenstance.  It was a deliberate choice which must be respected.  We 
do not really know why this approach was taken, but several reasons 
suggest themselves.  Historically, bills of rights, of which that of the 
United States is the great constitutional exemplar, have been directed at 
government.  Government is the body that can enact and enforce rules and 
authoritatively impinge on individual freedom.  Only government requires 
to be constitutionally shackled to preserve the rights of the individual.

69 La Forest J. warned that subjecting all private and public action to constitutional 
review would mean reopening whole areas of settled law and would be "tantamount to 
setting up an alternative tort system".  He expressed the very sage warning that this 
"could strangle the operation of society".  See also McLellan and Elman, "To Whom 
Does the Charter Apply?  Some Recent Cases on Section 32" (1986), 24 Alta. L. Rev. 
361, at p. 367, cited in Dolphin Delivery Ltd, supra, at p. 597.

70 The appellants argue that at all material times Casey Hill was an agent of the Crown, 
acting on behalf of the Attorney General of Ontario, and that the defamatory 
statements which are the subject of the present action were made in relation to acts 
undertaken by him in that capacity.  They further submit that Casey Hill commenced 
these legal proceedings at the direction and with the financial support of the Attorney 
General in order to vindicate the damage to the reputation of the Ministry resulting 
from criticism levelled at the conduct of one of its officials.  It is, therefore, contended 
that this action represents an effort by a government department to use the action of 
defamation to restrict and infringe the freedom of expression of the appellants in a 
manner that is contrary to the Charter.

71 These submissions cannot be accepted.  They have no legal, evidentiary or logical 
basis of support.  Casey Hill's constitutional status for the purpose of the application 
of the Charter should not be determined by the nature of the allegations made against 
him.  Rather, the determination of whether state involvement existed is dependent 
upon the circumstances surrounding the institution of the libel proceedings.

72 The fact that persons are employed by the government does not mean that their 
reputation is automatically divided into two parts, one related to their personal life 
and the other to their employment status.  To accept the appellants' position would 
mean that identical defamatory comments would be subject to two different laws, one 
applicable to government employees, the other to the rest of society.  Government 
employment cannot be a basis for such a distinction.  Reputation is an integral and 
fundamentally important aspect of every individual.  It exists for everyone quite apart 
from employment.

73 In order to establish the requisite government action for Charter scrutiny, the 
appellants argue that it is easy to distinguish between a janitor working in a 
government building who is simply an employee and a Crown Attorney who is an 
agent of the state.  It is said that when a person who is clearly an agent of the state 
acts, he or she is acting for or on behalf of the state.  I cannot accept this proposition. 
 There are a significant number of public servants who represent the Crown in any 
number of ways.  While it might be easy to differentiate between the extreme 
examples set forth by the appellants, the grey area between those extremes is too 
extensive and the functions of the officials too varied to draw any effective line of 
distinction.  The experience in the United States following the decision in New York 
Times v. Sullivan, supra, is instructive in this regard.  That case modified the common 
law in relation to defamation suits brought by public officials and touched off an 
intense debate with respect to who might be designated as a public official or figure 
rather than a private person.  See, for example, G. Christie, "Injury to Reputation and 
the Constitution:  Confusion Amid Conflicting Approaches" (1976), 75 Mich. L. Rev. 
43.

74 There is no doubt that Crown Attorneys exercise statutory powers as agents of the 
government.  See Ministry of the Attorney General Act, R.S.O. 1990, c. M.17; Crown 
Attorneys Act, R.S.O. 1990, c. C.49; and the Criminal Code, R.S.C., 1985, c. C-46, 
s. 504.  Therefore, as McIntyre J. pointed out in Nelles v. Ontario, [1989] 2 S.C.R. 
170, at p. 209, they benefit from the protection of any immunity which attaches to 
their office.  However, they may become personally liable when they exceed their 
statutory powers.  By extension, actions taken by Crown Attorneys which are 
outside the scope of their statutory duties are independent of and distinct from their 
status as agents for the government.  Such was the case here.

75 The appellants impugned the character, competence and integrity of Casey Hill, 
himself, and not that of the government.  He, in turn, responded by instituting legal 
proceedings in his own capacity.  There was no evidence that the Ministry of the 
Attorney General or the Government of Ontario required or even requested him to do 
so.  Neither is there any indication that the Ministry controlled the conduct of the 
litigation in any way.  See Lavigne v. Ontario Public Service Employees Union, 
[1991] 2 S.C.R. 211, at pp. 311-14.  Further, the fact that Casey Hill's suit may have 
been funded by the Ministry of the Attorney General does not alter his constitutional 
status or cloak his personal action in the mantle of government action.  See McKinney, 
supra, at p. 269.

76 The private nature of these proceedings is apparent, as well, from the respondent's 
statement of claim, and particularly from the allegation contained in para. 19 that the 
defamatory statements:


. . . constituting as they do statements of the most serious professional 
misconduct by the Plaintiff, have damaged his professional reputation and 
brought him into public scandal, odium and contempt, by reason of which 
the Plaintiff has suffered damage.

77 The position taken by the appellants at trial is also revealing.  Scientology argued that 
Casey Hill was proceeding with the litigation to advance his "secondary private 
interest", that he was trying to "get back at [Scientology] for prosecuting him for 
contempt", and that the libel action amounted to "a risk-free opportunity . . . to pick 
up some easy money".

78 The personal nature of the libel action is also evident in the cross-examination of 
Casey Hill concerning his work with the OPP.  At that time, counsel for Scientology 
stated that the libel action had "nothing to do with damages suffered by Mr. Hill.  It's 
part of an attack motivated by the attitude towards the Church of Scientology, 
motivated by the fact that as a result of the contempt prosecution he is removed from 
prosecuting".

79 In my opinion, the appellants have not satisfied the government action requirement 
described in s. 32.  Therefore, the Charter cannot be applied directly to scrutinize the 
common law of defamation in the circumstances of this case.

80 Even if there were sufficient government action to bring this case within s. 32, the 
appellants failed to provide any evidentiary basis upon which to adjudicate their 
constitutional attack.  This court has stated on a number of occasions that it will not 
determine alleged Charter violations in the absence of a proper evidentiary record.  
See, for example, MacKay v. Manitoba, [1989] 2 S.C.R. 357.  In light of the 
conclusion that the government action requirement of s. 32 has not been met, I need 
not address this issue.  Yet, I feel a brief comment is necessary because of the light it 
sheds on the manner in which the appellants have conducted themselves in this 
litigation.

81 The action was commenced in December 1984.  By the fall of 1985, the appellants 
were made aware of the requirement to adduce constitutional evidence.  In dismissing 
the appellants' pre-trial motion with respect to the constitutional issues, O'Driscoll J. 
clearly indicated that the constitutional questions must be decided upon evidence 
adduced at trial.  The date for trial was fixed in January, 1991 and confirmed in June.  
On September 4, 1991, two days into the proceedings, counsel for Scientology sought 
to adjourn the trial on the grounds that there was "a possibility of seeking to call 
expert evidence in regard to the freedom of speech issue in the trial".  Counsel 
conceded that he had not prepared or delivered any reports of experts in respect to 
this issue, and indeed, that he had not yet even consulted with experts.  He simply 
wanted the adjournment in order to "explore the area".  The request for adjournment 
was very properly dismissed.

82 There is no government action involved in this defamation suit.  It now must be 
determined whether a change or modification in the law of defamation is required to 
make it comply with the underlying values upon which the Charter is founded.


(2)
Section 52:  Charter Values and the Common Law


(a)
Interpretating the Common Law in Light of the Values Underlying the 
Charter


(i)
Review of the Decisions Dealing With the Issue

83 This Court first considered the application of the Charter to the common law in 
Dolphin Delivery, supra.  In that case, the issue was whether an injunction to restrain 
secondary picketing violated the Charter freedom of expression.  It was held that, 
pursuant to s. 32(1) of the Charter, a cause of action could only be based upon the 
Charter when particular government action was impugned.  Therefore, the 
constitutionality of the common law could be scrutinized in those situations where a 
case involved government action which was authorized or justified on the basis of a 
common law rule which allegedly infringed a Charter right.  However, Dolphin 
Delivery, supra, also held that the common law could be subjected to Charter 
scrutiny in the absence of government action.  McIntyre J. wrote, at pp. 592-93, that, 
in light of s. 52(1) of the Charter, "there can be no doubt" that the Charter applies to 
the common law:


The English text provides that "any law that is inconsistent with the 
provisions of the Constitution is, to the extent of the inconsistency, of no 
force or effect".  If this language is not broad enough to include the 
common law, it should be observed as well that the French text adds 
strong support to this conclusion in its employment of the words "elle 
rend inoperantes les dispositions incompatibles de tout autre regle de 
droit".  . . .  To adopt a construction of s. 52(1) which would exclude from 
Charter application the whole body of the common law which in great 
part governs the rights and obligations of the individuals in society, would 
be wholly unrealistic and contrary to the clear language employed in 
s. 52(1) of the Act.  [Emphasis in Dolphin Delivery.]

In emphasizing that the common law should develop in a manner consistent with 
Charter principles, a distinction was drawn between private litigants founding a cause 
of action on the Charter and judges exercising their inherent jurisdiction to develop the 
common law.  At page 603 this was written:


Where, however, private party "A" sues private party "B" relying on the 
common law and where no act of government is relied upon to support 
the action, the Charter will not apply.  I should make it clear, however, 
that this is a distinct issue from the question whether the judiciary ought 
to apply and develop the principles of the common law in a manner 
consistent with the fundamental values enshrined in the Constitution.  
The answer to this question must be in the affirmative.  In this sense, 
then, the Charter is far from irrelevant to private litigants whose disputes 
fall to be decided at common law.  But this is different from the 
proposition that one private party owes a constitutional duty to another, 
which proposition underlies the purported assertion of Charter causes of 
action or Charter defences between individuals.  [Emphasis added.]

84 Since 1986, this Court has subjected the common law to Charter scrutiny in a number 
of situations where government action was based upon a common law rule:  
B.C.G.E.U. v. British Columbia (Attorney General), [1988] 2 S.C.R. 214; R. v. Swain, 
[1991] 1 S.C.R. 933; R. v. Salituro, [1991] 3 S.C.R. 654; and Dagenais v. Canadian 
Broadcasting Corp., [1994] 3 S.C.R. 835.  However, Dolphin Delivery, supra, 
remains the only case which has closely examined the application of the Charter in 
the context of purely private litigation.  Nevertheless, it is helpful to review the 
different approaches which have been suggested in those cases in order to better 
appreciate which principles should properly apply in cases of private litigation.

85 In R. v. Salituro, supra, the Crown called the accused's estranged wife as a witness.  
The common law rule prohibiting spouses from testifying against each other was 
found to be inconsistent with developing social values and with the values enshrined 
in the Charter.  At page 670, Iacobucci J., writing for the Court, held:


Judges can and should adapt the common law to reflect the changing 
social, moral and economic fabric of the country.  Judges should not be 
quick to perpetuate rules whose social foundation has long since 
disappeared.  Nonetheless, there are significant constraints on the power 
of the judiciary to change the law.  As McLachlin J. indicated in Watkins, 
supra, in a constitutional democracy such as ours it is the legislature and 
not the courts which has the major responsibility for law reform; and for 
any changes to the law which may have complex ramifications, however 
necessary or desirable such changes may be, they should be left to the 
legislature.  The judiciary should confine itself to those incremental 
changes which are necessary to keep the common law in step with the 
dynamic and evolving fabric of our society.

Further, at p. 675 this Court held:



Where the principles underlying a common law rule are out of step 
with the values enshrined in the Charter, the courts should scrutinize the 
rule closely.  If it is possible to change the common law rule so as to make 
it consistent with Charter values, without upsetting the proper balance 
between judicial and legislative action that I have referred to above, then 
the rule ought to be changed.

86 Unlike the present appeal and the decisions of this Court in B.C.G.E.U., Swain, and 
Dagenais, the common law rule in Salituro was not alleged to infringe a specific 
Charter right.  Rather, it was alleged to be inconsistent with those fundamental values 
that provide the foundation for the Charter.  Although the Court in Salituro 
considered whether Parliament had, through the Evidence Act, intended to preserve the 
common law rule, it did not undertake an analysis similar to that which would be 
required under s. 1 to determine if the Charter breach was justifiable.  Rather, it 
proceeded to balance, in a broad and flexible manner, the conflicting values.  The 
reasons examined the origins of the impugned common law rule and the justifications 
which had been raised for upholding it.  These concerns were weighed against the 
Charter's recognition of the equality of women and, more specifically, against the 
concept of human dignity which inspires the Charter.  It was held that the values 
which were set out in the common law rule did not represent the values of today's 
society which are reflected in the provisions of the Charter.

87 In B.C.G.E.U., supra, McEachern C.J.B.C. on his own motion issued an injunction 
against a union picketing in front of the courthouse:  [1983] 6 W.W.R. 640.  It was 
held that the common law rule giving rise to the picketing injunction breached s. 2(b).  
The breach was then found to be justified following a traditional s. 1 analysis.

88 Subsequently, in R. v. Swain, supra, Lamer C.J. observed that the s. 1 analysis, which 
has evolved since R. v. Oakes, [1986] 1 S.C.R. 103, may not always provide the 
appropriate framework by which to evaluate the justifications for maintaining a 
common law rule.  In R. v. Swain, supra, the Crown raised the insanity defence, over 
objections by the accused, on the basis of the common law rule which authorized such 
a procedure.  That rule was found to violate s. 7 of the Charter.  At pages 978-79, 
Lamer C.J. held:



Before turning to s. 1, however, I wish to point out that because this 
appeal involves a Charter challenge to a common law, judge-made rule, 
the Charter analysis involves somewhat different considerations than 
would apply to a challenge to a legislative provision.  For example, having 
found that the existing common law rule limits an accused's rights under s. 
7 of the Charter, it may not be strictly necessary to go on to consider the 
application of s. 1.  Having come to the conclusion that the common law 
rule enunciated by the Ontario Court of Appeal limits an accused's right 
to liberty in a manner which does not accord with the principles of 
fundamental justice, it could, in my view, be appropriate to consider at 
this stage whether an alternative common law rule could be fashioned 
which would not be contrary to the principles of fundamental justice.



If a new common law rule could be enunciated which would not 
interfere with an accused person's right to have control over the conduct 
of his or her defence, I can see no conceptual problem with the Court's 
simply enunciating such a rule to take the place of the old rule, without 
considering whether the old rule could nonetheless be upheld under s. 1 of 
the Charter.  Given that the common law rule was fashioned by judges 
and not by Parliament or a legislature, judicial deference to elected bodies 
is not an issue.  If it is possible to reformulate a common law rule so that 
it will not conflict with the principles of fundamental justice, such a 
reformulation should be undertaken.  Of course, if it were not possible to 
reformulate the common law rule so as to avoid an infringement of a 
constitutionally protected right or freedom, it would be necessary for the 
Court to consider whether the common law rule could be upheld as a 
reasonable limit under s. 1 of the Charter.

Nevertheless, in R. v. Swain, supra, the formal s. 1 analysis was undertaken since 
Oakes, supra, provided a familiar structure for analysis, the constitutional questions 
were stated with s. 1 in mind and the Court had the benefit of extensive argument on 
s. 1.

89 Finally, in Dagenais, supra, the CBC challenged a publication ban which prevented 
them from airing one of their programmes.  It was held that where the common law 
rule on publication bans conflicted with Charter values, the common law rule must be 
varied in such a manner as to enable the Court to consider both the objective of a 
publication ban and the proportionality of the ban's effect on protected Charter 
rights.  Without adopting a formal s. 1 analysis, it was held that this approach "clearly 
reflects the substance of the Oakes test applicable when assessing legislation under 
s. 1 of the Charter" (p. 878).

90 In light of these cases, then, it remains to be determined what approach should be 
followed when, in the context of private litigation with no government action 
involved, a common law rule is alleged to be inconsistent with the Charter.


(ii)
Approach that Should be Followed

91 It is clear from Dolphin Delivery, supra, that the common law must be interpreted in a 
manner which is consistent with Charter principles.  This obligation is simply a 
manifestation of the inherent jurisdiction of the courts to modify or extend the 
common law in order to comply with prevailing social conditions and values.  As was 
said in Salituro, supra, at p. 678:


The courts are the custodians of the common law, and it is their duty to 
see that the common law reflects the emerging needs and values of our 
society.

92 Historically, the common law evolved as a result of the courts making those 
incremental changes which were necessary in order to make the law comply with 
current societal values.  The Charter represents a restatement of the fundamental 
values which guide and shape our democratic society and our legal system.  It follows 
that it is appropriate for the courts to make such incremental revisions to the common 
law as may be necessary to have it comply with the values enunciated in the Charter.

93 When determining how the Charter applies to the common law, it is important to 
distinguish between those cases in which the constitutionality of government action is 
challenged, and those in which there is no government action involved.  It is important 
not to import into private litigation the analysis which applies in cases involving 
government action.

94 In Dolphin Delivery, supra, it was noted that the Charter sets out those specific 
constitutional duties which the state owes to its citizens.  When government action is 
challenged, whether it is based on legislation or the common law, the cause of action is 
founded upon a Charter right.  The claimant alleges that the state has breached its 
constitutional duty.  The state, in turn, must justify that breach.  While criminal cases 
present the prime example of government action, challenges to government action can 
also arise in civil cases.  The state's obligation to uphold its constitutional duties is no 
less pressing in the civil sphere than in the criminal.  The two cases of B.C.G.E.U., 
supra, and Dagenais, supra, present a very specific type of "government action" in 
the civil context.  In both cases, the court was called upon to consider the operations 
of the court and to determine the extent of its own jurisdiction to consider matters 
which were essentially public in nature.  The cases did not involve strictly private 
litigation.  Therefore, they must be approached with caution when considering what 
analysis should be applied in purely private civil litigation.

95 Private parties owe each other no constitutional duties and cannot found their cause of 
action upon a Charter right.  The party challenging the common law cannot allege that 
the common law violates a Charter right because, quite simply, Charter rights do not 
exist in the absence of state action.  The most that the private litigant can do is argue 
that the common law is inconsistent with Charter values.  It is very important to 
draw this distinction between Charter rights and Charter values.  Care must be taken 
not to expand the application of the Charter beyond that established by s. 32(1), 
either by creating new causes of action, or by subjecting all court orders to Charter 
scrutiny.  Therefore, in the context of civil litigation involving only private parties, the 
Charter will "apply" to the common law only to the extent that the common law is 
found to be inconsistent with Charter values.

96 Courts have traditionally been cautious regarding the extent to which they will amend 
the common law.  Similarly, they must not go further than is necessary when taking 
Charter values into account.  Far-reaching changes to the common law must be left to 
the legislature.

97 When the common law is in conflict with Charter values, how should the competing 
principles be balanced?  In my view, a traditional s. 1 framework for justification is 
not appropriate.  It must be remembered that the Charter "challenge" in a case 
involving private litigants does not allege the violation of a Charter right.  It addresses 
a conflict between principles.  Therefore, the balancing must be more flexible than the 
traditional s. 1 analysis undertaken in cases involving governmental action cases.  
Charter values, framed in general terms, should be weighed against the principles 
which underlie the common law.  The Charter values will then provide the guidelines 
for any modification to the common law which the court feels is necessary.

98 Finally, the division of onus which normally operates in a Charter challenge to 
government action should not be applicable in a private litigation Charter "challenge" 
to the common law.  This is not a situation in which one party must prove a prima 
facie violation of a right while the other bears the onus of defending it.  Rather, the 
party who is alleging that the common law is inconsistent with the Charter should 
bear the onus of proving both that the common law fails to comply with Charter 
values and that, when these values are balanced, the common law should be modified.  
In the ordinary situation, where government action is said to violate a Charter right, it 
is appropriate that the government undertake the justification for the impugned 
statute or common law rule.  However, the situation is very different where two 
private parties are involved in a civil suit.  One party will have brought the action on 
the basis of the prevailing common law which may have a long history of acceptance 
in the community.  That party should be able to rely upon that law and should not be 
placed in the position of having to defend it.  It is up to the party challenging the 
common law to bear the burden of proving not only that the common law is 
inconsistent with Charter values but also that its provisions cannot be justified.

99 With that background, let us first consider the common law of defamation in light of 
the values underlying the Charter.


(b)
The Nature of Actions for Defamation:  The Values to Be Balanced

100 There can be no doubt that in libel cases the twin values of reputation and freedom of 
expression will clash.  As Edgerton J. stated in Sweeney v. Patterson, 128 F.2d 457 
(D.C. Cir. 1942), at p. 458, cert. denied 317 U.S. 678 (1942), whatever is "added to 
the field of libel is taken from the field of free debate".  The real question, however, is 
whether the common law strikes an appropriate balance between the two.  Let us 
consider the nature of each of these values.


(i)
Freedom of Expression

101 Much has been written of the great importance of free speech.  Without this freedom 
to express ideas and to criticize the operation of institutions and the conduct of 
individual members of government agencies, democratic forms of government would 
wither and die.  See, for example, Reference re Alberta Statutes, [1938] S.C.R. 100, at 
p. 133; Switzman v. Elbling, [1957] S.C.R. 285, at p. 306; and Boucher v. The King, 
[1951] S.C.R. 265, at p. 326.  More recently, in Edmonton Journal, supra, at p. 1336, 
it was said:



It is difficult to imagine a guaranteed right more important to a 
democratic society than freedom of expression.  Indeed a democracy 
cannot exist without that freedom to express new ideas and to put 
forward opinions about the functioning of public institutions.  The 
concept of free and uninhibited speech permeates all truly democratic 
societies and institutions.  The vital importance of the concept cannot be 
over-emphasized.

102 However, freedom of expression has never been recognized as an absolute right.  Duff 
C.J. emphasized this point in Reference re Alberta Statutes, supra, at p. 133:



The right of public discussion is, of course, subject to legal 
restrictions; those based upon considerations of decency and public order, 
and others conceived for the protection of various private and public 
interests with which, for example, the law of defamation and sedition are 
concerned.  In a word, freedom of discussion means . . . "freedom 
governed by law."  [Emphasis added.]

See also Cherneskey v. Armdale Publishers Ltd., [1979] 1 S.C.R. 1067, at pp. 1072 
and 1091.

103 Similar reasoning has been applied in cases argued under the Charter.  Although a 
Charter right is defined broadly, generally without internal limits, the Charter 
recognizes, under s. 1, that social values will at times conflict and that some limits 
must be placed even on fundamental rights.  As La Forest J. explained in United States 
of America v. Cotroni, [1989] 1 S.C.R. 1469, at p. 1489, this Court has adopted a 
flexible approach to measuring the constitutionality of impugned provisions wherein 
"the underlying values [of the Charter] are sensitively weighed in a particular context 
against other values of a free and democratic society . . .".

104 In R. v. Keegstra, [1990] 3 S.C.R. 697, for example, s. 319(2) of the Criminal Code 
was found to be justified as a reasonable limit on the appellant's freedom to spread 
falsehoods relating to the Holocaust and thus to promote hatred against an identifiable 
group.  Dickson C.J. adopted the contextual approach to s. 1 and concluded that, 
since hate propaganda contributed little to the values which underlie the right 
enshrined under s. 2(b), namely the quest for truth, the promotion of individual 
self-development, and participation in the community, a restriction on this type of 
expression might be easier to justify than would be the case with other kinds of 
expression.

105 In R. v. Butler, [1992] 1 S.C.R. 452, the obscenity provisions of the Criminal Code, 
R.S.C., 1985, c. C-46, s. 163, were questioned.  It was held, under the s. 1 analysis, 
that pornography could not stand on an equal footing with other kinds of expression 
which directly engage the "core" values of freedom of expression.  Further, it was 
found that the fact that the targeted material was expression motivated by economic 
profit more readily justified the imposition of restrictions.

106 Certainly, defamatory statements are very tenuously related to the core values which 
underlie s. 2(b).  They are inimical to the search for truth.  False and injurious 
statement cannot enhance self-development.  Nor can it ever be said that they lead to 
healthy participation in the affairs of the community.  Indeed, they are detrimental to 
the advancement of these values and harmful to the interests of a free and democratic 
society.  This concept was accepted in Globe & Mail Ltd. v. Boland, [1960] S.C.R. 
203, at pp. 208-9, where it was held that an extension of the qualified privilege to the 
publication of defamatory statements concerning the fitness for office of a candidate 
for election would be "harmful to that `common convenience and welfare of society'". 
 Reliance was placed upon the text Gatley on Libel and Slander (4th ed. 1953), at 
p. 254, wherein the author stated the following:


It would tend to deter sensitive and honourable men from seeking public 
positions of trust and responsibility, and leave them open to others who 
have no respect for their reputation.

See also Derrickson v. Tomat (1992), 88 D.L.R. (4th) 401 (B.C.C.A.), at p. 408.


(ii)
The Reputation of the Individual

107 The other value to be balanced in a defamation action is the protection of the 
reputation of the individual.  Although much has very properly been said and written 
about the importance of freedom of expression, little has been written of the 
importance of reputation.  Yet, to most people, their good reputation is to be 
cherished above all.  A good reputation is closely related to the innate worthiness and 
dignity of the individual.  It is an attribute that must, just as much as freedom of 
expression, be protected by society's laws.  In order to undertake the balancing 
required by this case, something must be said about the value of reputation.

108 Democracy has always recognized and cherished the fundamental importance of an 
individual.  That importance must, in turn, be based upon the good repute of a person. 
 It is that good repute which enhances an individual's sense of worth and value.  False 
allegations can so very quickly and completely destroy a good reputation.  A 
reputation tarnished by libel can seldom regain its former lustre.  A democratic 
society, therefore, has an interest in ensuring that its members can enjoy and protect 
their good reputation so long as it is merited.

109 From the earliest times, society has recognized the potential for tragic damage that can 
be occasioned by a false statement made about a person.  This is evident in the Bible, 
the Mosaic Code and the Talmud.  As the author Carter-Ruck, in Carter-Ruck on 
Libel and Slander (4th ed. 1992), explains at p. 17:



The earliest evidence in recorded history of any sanction for 
defamatory statements is in the Mosaic code.  In Exodus XXII 28 we find 
'Thou shalt not revile the gods nor curse the ruler of thy people' and in 
Exodus XXIII 1 'Thou shalt not raise a false report:  put not thine hand 
with the wicked to be an unrighteous witness'.  There is also a 
condemnation of rumourmongers in Leviticus XIX 16 'Thou shalt not go 
up and down as a talebearer among thy people'.

110 To make false statements which are likely to injure the reputation of another has 
always been regarded as a serious offence.  During the Roman era, the punishment for 
libel varied from the loss of the right to make a will, to imprisonment, exile for life, or 
forfeiture of property.  In the case of slander, a person could be made liable for 
payment of damages.

111 It was decreed by the Teutons in the Lex Salica that if a man called another a "wolf" 
or a "hare", he must pay the sum of three shillings; for a false imputation of 
unchastity in a woman the penalty was forty-five shillings.  In the Normal Costumal, 
if people falsely called another "thief" or "manslayer", they had to pay damages and, 
holding their nose with their fingers, publicly confess themselves a liar.

112 With the separation of ecclesiastical and secular courts by the decree of William I 
following the Norman conquest, the Church assumed spiritual jurisdiction over 
defamatory language, which was regarded as a sin.  The Church "stayed the tongue of 
the defamer at once pro custodia morum of the community, and pro salute animae of 
the delinquent".  See V.V. Veeder, "The History and Theory of the Law of 
Defamation" (1903), 3 Colum. L. Rev. 546, at p. 551.

113 By the 16th century, the common law action for defamation became commonplace.  
This was in no small measure due to the efforts of the Star Chamber to eradicate 
duelling, the favoured method of vindication.  The Star Chamber even went so far as 
to punish the sending of challenges.  However, when  it proscribed this avenue of 
recourse to injured parties, the Star Chamber was compelled to widen its original 
jurisdiction over seditious libel to include ordinary defamation.

114 The modern law of libel is said to have arisen out of the case De Libellis Famosis 
(1605), 5 Co. Rep. 125a, 77 E.R. 250.  There, the late Archbishop of Canterbury and 
the then Bishop of London were alleged to have been "traduced and scandalized" by 
an anonymous person.  As reported by Coke, it was ruled that all libels, even those 
against private individuals, ought to be sanctioned severely by indictment at common 
law or in the Star Chamber.  The reasoning behind this was that the libel could incite 
"all those of the same family, kindred, or society to revenge, and so tends per 
consequens to quarrels and breach of the peace".  It was not necessary to show 
publication to a third person and it made no difference whether the libel was true or 
whether the plaintiff had a good or bad reputation.  Eventually, truth was recognized 
as a defence in cases involving ordinary defamation.

115 It was not until the late 17th century that the distinction between libel and slander 
was drawn by Chief Baron Hale in King v. Lake (1670), Hardres 470, 145 E.R. 552, 
where it was held that words spoken, without more, would not be actionable, with a 
few exceptions.  Once they were reduced to writing, however, malice would be 
presumed and an action would lie.

116 The character of the law relating to libel and slander in the 20th century is essentially 
the product of its historical development up to the 17th century, subject to a few 
refinements such as the introduction and recognition of the defences of privilege and 
fair comment.  From the foregoing we can see that a central theme through the ages has 
been that the reputation of the individual is of fundamental importance.  As Professor 
R. E. Brown writes in The Law of Defamation in Canada (2nd ed. 1994), at p. 1-4:


"No system of civil law can fail to take some account of the right to have 
one's reputation untarnished by defamation."  Some form of legal or social 
constraints on defamatory publications "are to be found in all stages of 
civilization, however imperfect, remote, and proximate to barbarism."  
[Footnotes omitted.]

117 Though the law of defamation no longer serves as a bulwark against the duel and blood 
feud, the protection of reputation remains of vital importance.  As David Lepofsky 
suggests in "Making Sense of the Libel Chill Debate:  Do Libel Laws `Chill' the 
Exercise of Freedom of Expression?" (1994), 4 N.J.C.L. 169, at p. 197, reputation is 
the "fundamental foundation on which people are able to interact with each other in 
social environments".  At the same time, it serves the equally or perhaps more 
fundamentally important purpose of fostering our self-image and sense of self-worth. 
 This sentiment was eloquently expressed by Stewart J. in Rosenblatt v. Baer, 383 
U.S. 75 (1966), who stated at p. 92:



The right of a man to the protection of his own reputation from 
unjustified invasion and wrongful hurt reflects no more than our basic 
concept of the essential dignity and worth of every human being -- a 
concept at the root of any decent system of ordered liberty.

118 In the present case, consideration must be given to the particular significance 
reputation has for a lawyer.  The reputation of a lawyer is of paramount importance 
to clients, to other members of the profession and to the judiciary.  A lawyer's 
practice is founded and maintained upon the basis of a good reputation for 
professional integrity and trustworthiness.  It is the cornerstone of a lawyer's 
professional life.  Even if endowed with outstanding talent and indefatigable diligence, 
a lawyer cannot survive without a good reputation.  In his essay entitled "The 
Lawyer's Duty to Himself and the Code of Professional Conduct" (1993), 27 L. Soc. 
Gaz. 119, David Hawreluk described the importance of a reputation for integrity.  At 
page 121, he quoted Lord Birkett on the subject:


The advocate has a duty to his client, a duty to the Court, and a duty to 
the State; but he has above all a duty to himself and he shall be, as far as 
lies in his power, a man of integrity.  No profession calls for higher 
standards of honour and uprightness, and no profession, perhaps, offers 
greater temptations to forsake them; but whatever gifts an advocate may 
possess, be they never so dazzling, without the supreme qualification of 
an inner integrity he will fall short of the highest . . .

119 Similarly, Esson J. in Vogel v. Canadian Broadcasting Corp., [1982] 3 W.W.R. 97 
(B.C.S.C.), at pp. 177-78 stated:



The qualities required of a lawyer who aspires to the highest level of 
his profession are various, but one is essential.  That is a reputation for 
integrity.  The programs were a massive attack upon that reputation.  The 
harm done to it can never be wholly undone, and therefore the stigma so 
unfairly created will always be with the plaintiff.



When the details of the Vogel affair have faded from memory, what 
will remain in the minds of many people throughout Canada is a lurking 
recollection that he was the centre of a scandal which arose out of his 
conduct in office.

120 Although it is not specifically mentioned in the Charter, the good reputation of the 
individual represents and reflects the innate dignity of the individual, a concept which 
underlies all the Charter rights.  It follows that the protection of the good reputation 
of an individual is of fundamental importance to our democratic society.

121 Further, reputation is intimately related to the right to privacy which has been 
accorded constitutional protection.  As La Forest J. wrote in R. v. Dyment, [1988] 2 
S.C.R. 417, at p. 427, privacy, including informational privacy, is "[g]rounded in 
man's physical and moral autonomy" and "is essential for the well-being of the 
individual".  The publication of defamatory comments constitutes an invasion of the 
individual's personal privacy and is an affront to that person's dignity.  The 
protection of a person's reputation is indeed worthy of protection in our democratic 
society and must be carefully balanced against the equally important right of freedom 
of expression.  In order to undertake the requisite balancing of values, let us first 
review the change to the existing common law proposed by the appellants.


(c)
The Proposed Remedy:  Adopting the New York Times v. Sullivan 
"Actual Malice" Rule

122 In New York Times v. Sullivan, supra, the United States Supreme Court ruled that the 
existing common law of defamation violated the guarantee of free speech under the 
First Amendment of the Constitution.  It held that the citizen's right to criticize 
government officials is of such tremendous importance in a democratic society that it 
can only be accommodated through the tolerance of speech which may eventually be 
determined to contain falsehoods.  The solution adopted was to do away with the 
common law presumptions of falsity and malice and place the onus on the plaintiff to 
prove that, at the time the defamatory statements were made, the defendant either 
knew them to be false or was reckless as to whether they were or not.

123 At the outset, it is important to understand the social and political context of the 
times which undoubtedly influenced the decision in New York Times v. Sullivan, 
supra.  The impugned publication was an editorial advertisement, placed in the 
appellant's newspaper, entitled "Heed Their Rising Voices".  It criticized the 
widespread segregation which continued to dominate life in the southern states in the 
late 1950s and early 1960s.  Prominent and well respected individuals, including Mrs. 
Eleanor Roosevelt, lent their name to the advertisement.  It communicated 
information, recited grievances, protested abuses and sought financial support.  The 
group or movement sponsoring the advertisement was characterized by Brennan J. as 
one "whose existence and objective are matters of the highest public interest and 
concern" (p. 266).  Black J. described the controversy at the heart of the suit in the 
following terms at p. 294:


One of the acute and highly emotional issues in this country arises out of 
efforts of many people, even including some public officials, to continue 
state-commanded segregation of races in the public schools and other 
public places, despite our several holdings that such a practice is 
forbidden by the Fourteenth Amendment.

124 The advertisement did not mention by name the plaintiff, who was a white elected 
commissioner from Montgomery, Alabama.  Only 35 copies of the edition of the New 
York Times which carried that advertisement were circulated in Montgomery, and 
only 394 were circulated in the entire state of Alabama.  The trial took place in 1960, 
in a segregated court room in Montgomery, before a white judge and all-white jury.  
Damages of $500,000U.S. were awarded.  This would be the current equivalent in 
Canada of approximately $3.5 million.

125 The Supreme Court, in overturning the verdict, clearly perceived the libel action as a 
very serious attack not only on the freedom of the press but, more particularly, on 
those who favoured desegregation in the southern United States.  It was concerned 
that such a large damage award could threaten the very existence of, in Black J.'s 
words, "an American press virile enough to publish unpopular views on public affairs 
and bold enough to criticize the conduct of public officials" (p. 294).  This concern 
was intensified by the fact that a second libel verdict of $500,000U.S. had already 
been awarded to another Montgomery commissioner against the New York Times. In 
addition, 11 other libel suits, arising out of the same advertisement, were pending 
against the newspaper.

126 Another motivating factor for this radical change to the common law was the 
American jurisprudence to the effect that the statements of public officials, which 
came "within the outer perimeter of their duties", were privileged unless actual malice 
was proved.  The rationale behind this privilege was that the threat of damage suits 
would "dampen the ardor of all but the most resolute, or the most irresponsible, in the 
unflinching discharge of their duties":  Barr v. Matteo, 360 U.S. 564 (1959), at p. 571. 
 The Supreme Court in the Sullivan decision held that analogous considerations 
supported the protection which it accorded to critics of the government.


(d)
Critiques of the "Actual Malice" Rule


(i)
Comments on the Decision in the United States

127 The "actual malice" rule has been severely criticized by American judges and academic 
writers.  It has been suggested that the decision was overly influenced by the dramatic 
facts underlying the dispute and has not stood the test of time.  See, for example, R. 
Epstein, "Was New York Times v. Sullivan Wrong?" (1986), 53 U. Chi. L. Rev. 782, at 
p. 787; Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749 (1985), at 
p. 767.  Commentators have pointed out that, far from being deterred by the decision, 
libel actions have, in the post-Sullivan era, increased in both number and size of 
awards.  They have, in this way, mirrored the direction taken in other tort actions.  
See R. Epstein, supra; R. Bezanson, "Libel Law and the Realities of Litigation:  
Setting the Record Straight" (1985), 71 Iowa L. Rev. 226, at pp. 228-29.  It has been 
said that the New York Times v. Sullivan, supra, decision has put great pressure on 
the fact-finding process since courts are now required to make subjective 
determinations as to who is a public figure and what is a matter of legitimate public 
concern.  See G. Christie, supra, at pp. 63-64.

128 Perhaps most importantly, it has been argued the decision has shifted the focus of 
defamation suits away from their original, essential purpose.  Rather than deciding 
upon the truth of the impugned statement, courts in the U.S. now determine whether 
the defendant was negligent.  Several unfortunate results flow from this shift in focus. 
 First, it may deny the plaintiff the opportunity to establish the falsity of the 
defamatory statements and to determine the consequent reputational harm.  This is 
particularly true in cases where the falsity is not seriously contested.  See R. 
Bezanson, supra, at p. 227.

129 Second, it necessitates a detailed inquiry into matters of media procedure.  This, in 
turn, increases the length of discoveries and of the trial which may actually increase, 
rather than decrease, the threat to speech interests.  See D. Barrett, "Declaratory 
Judgments for Libel:  A Better Alternative" (1986), 74 Cal. L. Rev. 847, at p. 855.

130 Third, it dramatically increases the cost of litigation.  This will often leave a plaintiff 
who has limited funds without legal recourse.  See P. N. Leval, "The No-Money, 
No-Fault Libel Suit:  Keeping Sullivan in its Proper Place" (1988), 101 Harv. L. Rev. 
1287, at p. 1288; A. Lewis, "New York Times v. Sullivan Reconsidered:  Time to 
Return to `The Central Meaning of the First Amendment'" (1983), 83 Colum. L. Rev. 
603; M. London, "The `Muzzled Media':  Constitutional Crisis or Product Liability 
Scam?" in At What Price? Libel Law and Freedom of the Press (1993), at pp. 17-20.

131 Fourth, the fact that the dissemination of falsehoods is protected is said to exact a 
major social cost by deprecating truth in public discourse.  See L. C. Bollinger, "The 
End of New York Times v. Sullivan:  Reflections on Masson v. New Yorker 
Magazine", [1991] Sup. Ct. Rev. 1, at p. 6; J. A. Barron, "Access to the Press -- A 
New First Amendment Right" (1966-67), 80 Harv. L. Rev. 1641, at pp. 1657-58.

132 A number of jurists in the United States have advocated a reconsideration of the New 
York Times v. Sullivan standard.  These include one of the justices of the Supreme 
Court who participated in that decision.  In Dun & Bradstreet, Inc., supra, White J. 
stated, in a minority concurring opinion with which Burger C.J. concurred on this 
point, that he had "become convinced that the Court struck an improvident balance in 
the New York Times case between the public's interest in being fully informed about 
public officials and public affairs and the competing interest of those who have been 
defamed in vindicating their reputation" (p. 767).  He went on to state at pp. 767-69:



In a country like ours, where the people purport to be able to govern 
themselves through their elected representatives, adequate information 
about their government is of transcendent importance.  That flow of 
intelligence deserves full First Amendment protection.  Criticism and 
assessment of the performance of public officials and of government in 
general are not subject to penalties imposed by law.  But these First 
Amendment values are not at all served by circulating false statements of 
fact about public officials.  On the contrary, erroneous information 
frustrates these values.  They are even more disserved when the 
statements falsely impugn the honesty of those men and women and 
hence lessen the confidence in government.  As the Court said in Gertz:  
"[T]here is no constitutional value in false statements of fact.  Neither the 
intentional lie nor the careless error materially advances society's interest 
in `uninhibited, robust, and wide-open' debate on public issues." . . .  Yet 
in New York Times cases, the public official's complaint will be dismissed 
unless he alleges and makes out a jury case of a knowing or reckless 
falsehood.  Absent such proof, there will be no jury verdict or judgment 
of any kind in his favor, even if the challenged publication is admittedly 
false.  The lie will stand and the public continue to be misinformed about 
public matters.  . . .  Furthermore, when the plaintiff loses, the jury will 
likely return a general verdict and there will be no judgment that the 
publication was false, even though it was without foundation in reality.  
The public is left to conclude that the challenged statement was true after 
all.  Their only chance of being accurately informed is measured by the 
public official's ability himself to counter the lie, unaided by the courts.  
That is a decidedly weak reed to depend on for the vindication of First 
Amendment interests . . .



Also, by leaving the lie uncorrected, the New York Times rule plainly 
leaves the public official without a remedy for the damage to his 
reputation.  Yet the Court has observed that the individual's right to the 
protection of his own good name is a basic consideration of our 
constitutional system, reflecting "`our basic concept of the essential 
dignity and worth of every human being -- a concept at the root of any 
decent system of ordered liberty.'" . . .



The New York Times rule thus countenances two evils:  first, the 
stream of information about public officials and public affairs is polluted 
and often remains polluted by false information; and second, the 
reputation and professional life of the defeated plaintiff may be destroyed 
by falsehoods that might have been avoided with a reasonable effort to 
investigate the facts.  In terms of the First Amendment and reputational 
interests at stake, these seem grossly perverse results.  [Emphasis added.]

133 In the subsequent case of Coughlin v. Westinghouse Broadcasting & Cable, Inc., 476 
U.S. 1187 (1986), the majority of the United States Supreme Court refused to grant 
certiorari.  Burger C.J. and Rehnquist J. dissented because of their view that the court 
should re-examine New York Times v. Sullivan, supra, and "give plenary attention to 
this important issue" (p. 1187).


(ii)
Consideration of the Actual Malice Rule in the United Kingdom

134 The courts in England have refused to adopt the "actual malice" standard.  In 
Derbyshire County Council v. Times Newspapers Ltd., [1993] 1 All E.R. 1011, the 
House of Lords considered an action brought by a municipal council against the 
publisher of a Sunday newspaper.  The claim for damages, which was denied, arose 
from articles concerning the authority's management of its superannuation fund.  In 
his reasons, Lord Keith stated that public interest considerations similar to those 
underlying the New York Times v. Sullivan, supra, decision were involved in that it 
was "of the highest public importance that a democratically elected governmental 
body, or indeed any governmental body, should be open to uninhibited public 
criticism".  However, the appropriateness of the "actual malice" standard was not 
considered and it was not incorporated into the law of England.  In fact, Lord Keith 
stated that if the individual reputation of any of the local councillors had been 
wrongly damaged by the impugned publication, they could have brought an action for 
defamation in their personal capacity.


(iii)
The Australian Position on Actual Malice

135 The Australian case of Theophanous v. Herald and Weekly Times Ltd (1994), 124 
A.L.R. 1 (H.C.) considered an action brought by a member of that country's House of 
Representatives in response to a letter to the editor of a local newspaper which was 
critical of his views.  Although a plurality of the seven judges sitting on the High 
Court held that the existing law of defamation curtailed the constitutionally protected 
right to political discussion, it rejected the adoption of the "actual malice" standard, 
stating at pp. 22-23:



Even assuming that, in conformity with Sullivan, the test is confined 
to plaintiffs who are public officials, in our view it gives inadequate 
protection to reputation.  . . .


. . . the protection of free communication does not necessitate such a 
subordination of the protection of individual reputation as appears to 
have occurred in the United States.


(iv)
The Position Taken By International Law Reform Commissions

136 International law reform organizations have also criticized the New York Times v. 
Sullivan rule.  The Australian Law Reform Commission's Report No. 11 (the Kirby 
Committee Report) (1979) criticized the concept of "public official" on the basis that 
"a minor elected official or public servant [would be] in a more vulnerable position 
than a prominent businessman" (p. 252).  The Report of the Committee on Defamation 
(the Faulks Committee Report) (1975) held that the rule "would in many cases deny a 
just remedy to defamed persons" (p. 169).  Finally, the Irish Law Reform 
Commission's Report on the Civil Law of Defamation (the Keane Final Report) stated 
that "while the widest possible range of criticism of public officials and public figures 
is desirable, statements of fact contribute meaningfully to public debate only if they 
are true" (p. 82).


(e)
Conclusion:  Should the Law of Defamation be Modified by 
Incorporating the Sullivan Principle?

137 The New York Times v. Sullivan, supra, decision has been criticized by judges and 
academic writers in the United States and elsewhere.  It has not been followed in the 
United Kingdom or Australia.  I can see no reason for adopting it in Canada in an 
action between private litigants.  The law of defamation is essentially aimed at the 
prohibition of the publication of injurious false statements.  It is the means by which 
the individual may protect his or her reputation which may well be the most 
distinguishing feature of his or her character, personality and, perhaps, identity.  I 
simply cannot see that the law of defamation is unduly restrictive or inhibiting.  
Surely it is not requiring too much of individuals that they ascertain the truth of the 
allegations they publish.  The law of defamation provides for the defences of fair 
comment and of qualified privilege in appropriate cases.  Those who publish 
statements should assume a reasonable level of responsibility.

138 The Canadian Daily Newspaper Association indicated, in its response to A 
Consultation Draft of the General Limitations Act (September 1991) at p. 3, that the 
law of libel is "a carefully-crafted regime" which has "functioned fairly for the media 
and for complainants for many years".  Freedom of speech, like any other freedom, is 
subject to the law and must be balanced against the essential need of the individuals to 
protect their reputation.  The words of Diplock J. in Silkin v. Beaverbrook 
Newspapers Ltd., [1958] 1 W.L.R. 743, at pp. 745-46, are worth repeating:


Freedom of speech, like the other fundamental freedoms, is freedom under 
the law, and over the years the law has maintained a balance between, on 
the one hand, the right of the individual . . . whether he is in public life or 
not, to his unsullied reputation if he deserves it, and on the other hand . . . 
the right of the public . . . to express their views honestly and fearlessly 
on matters of public interest, even though that involves strong criticism of 
the conduct of public people.

139 None of the factors which prompted the United States Supreme Court to rewrite the 
law of defamation in America are present in the case at bar.  First, this appeal does 
not involve the media or political commentary about government policies.  Thus the 
issues considered by the High Court of Australia in Theophanous, supra, are also not 
raised in this case and need not be considered.

140 Second, a review of jury verdicts in Canada reveals that there is no danger of 
numerous large awards threatening the viability of media organizations.  Finally, in 
Canada there is no broad privilege accorded to the public statements of government 
officials which needs to be counterbalanced by a similar right for private individuals.

141 In conclusion, in its application to the parties in this action, the common law of 
defamation complies with the underlying values of the Charter and there is no need to 
amend or alter it.

142 Consideration must now be given to the submission made on behalf of Morris 
Manning that the defence of qualified privilege should be expanded to include reports 
upon pleadings and court documents that have been filed or are at the point of being 
filed.


(f)
Should the Common Law Defence of Qualified Privilege be Expanded 
to Comply with Charter values?

143 Qualified privilege attaches to the occasion upon which the communication is made, 
and not to the communication itself.  As Lord Atkinson explained in Adam v. Ward, 
[1917] A.C. 309, 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 made has 
a corresponding interest or duty to receive it.  This reciprocity is 
essential.

This passage was quoted with approval in McLoughlin v. Kutasy, [1979] 2 S.C.R. 
311, at p. 321.

144 The legal effect of the defence of qualified privilege is to rebut the inference, which 
normally arises from the publication of defamatory words, that they were spoken 
with malice.  Where the occasion is shown to be privileged, the bona fides of the 
defendant is presumed and the defendant is free to publish, with impunity, remarks 
which may be defamatory and untrue about the plaintiff.  However, the privilege is 
not absolute and can be defeated if the dominant motive for publishing the statement 
is actual or express malice.  See Horrocks v. Lowe, [1975] A.C. 135 (H.L.), at p. 149.

145 Malice is commonly understood, in the popular sense, as spite or ill-will.  However, it 
also includes, as Dickson J. pointed out in dissent in Cherneskey, supra, at p. 1099, 
"any indirect motive or ulterior purpose" that conflicts with the sense of duty or the 
mutual interest which the occasion created.  See, also, Taylor v. Despard, [1956] O.R. 
963 (C.A.).  Malice may also be established by showing that the defendant spoke 
dishonestly, or in knowing or reckless disregard for the truth.  See McLoughlin, supra, 
at pp. 323-24, and Netupsky v. Craig, [1973] S.C.R. 55, at pp. 61-62.

146 Qualified privilege may also be defeated when the limits of the duty or interest have 
been exceeded.  See The Law of Defamation in Canada (2nd ed 1994), at pp. 13-193 - 
13-194; Salmond and Heuston on the Law of Torts (20th ed. 1992), at pp. 166-67.  
As Loreburn E. stated at pp. 320-21 in Adam v. Ward, supra:


. . . the fact that an occasion is privileged does not necessarily protect all 
that is said or written on that occasion.  Anything that is not relevant and 
pertinent to the discharge of the duty or the exercise of the right or the 
safeguarding of the interest which creates the privilege will not be 
protected.

147 In other words, the information communicated must be reasonably appropriate in the 
context of the circumstances existing on the occasion when that information was 
given.  For example, in Douglas v. Tucker, [1952] 1 S.C.R. 275, the defendant, during 
an election campaign, stated that the plaintiff, who was the officer of an investment 
company, had charged a farmer and his wife an exorbitant rate of interest causing them 
to lose their property.  The plaintiff maintained that the allegation was without 
foundation.  In response, the defendant asserted that the plaintiff was facing a charge 
of fraud which had been adjourned until after the election.  This Court held that the 
defendant had an interest in responding to the plaintiff's denial, thereby giving rise to 
an occasion of qualified privilege.  However, it ruled that the occasion was exceeded 
because the defendant's comments went beyond what was "germane and reasonably 
appropriate" (p. 286).

148 In Sun Life Assurance Co. v. Dalrymple, [1965] S.C.R. 302, the district manager of 
the defendant insurance company threatened to resign and take the district agents with 
him.  This Court held that it fell within the scope of the privilege for the company to 
make certain defamatory comments about the plaintiff in order to dissuade its agents 
from leaving.

149 The principal question to be answered in this appeal is whether the recitation of the 
contents of the notice of motion by Morris Manning took place on an occasion of 
qualified privilege.  If so, it remains to be determined whether or not that privilege was 
exceeded and thereby defeated.

150 The traditional common law rule with respect to reports on documents relating to 
judicial proceedings is set out in Gatley on Libel and Slander (8th ed. 1981), at p. 252, 
in these words:


The rule of law is that, where there are judicial proceedings before a 
properly constituted judicial tribunal exercising its jurisdiction in open 
court, then the publication without malice of a fair and accurate report of 
what takes place before that tribunal is privileged.

See, also, The Law of Defamation in Canada, supra, at pp. 14-35, 14-42; Carter-Ruck 
on Libel and Slander, supra, at pp. 140-41.

151 The rationale behind this rule is that the public has a right to be informed about all 
aspects of proceedings to which it has the right of access.  This is why a news report 
referring to the contents of any document filed as an exhibit, or admitted as evidence 
during the course of the proceedings, is privileged.  However, the common law 
immunity was not extended to a report on pleadings or other documents which had 
not been filed with the court or referred to in open court.  Duff C.J. explained the 
reasoning for this in Gazette Printing Co. v. Shallow (1909), 41 S.C.R. 339, at p. 360:


The publicity of proceedings involving the conduct of a judicial authority 
serves the important purposes of impressing those concerned in the 
administration of justice with a sense of public responsibility, and of 
affording every member of the community an opportunity of observing 
for himself the mode in which the business of the public tribunals is 
carried on; but no such object would appear to be generally served by 
applying the privilege to the publication of preliminary statements of 
claims and defence relating only to private transactions; formulated by the 
parties themselves; in respect of which no judicial action has been taken, 
and upon which judicial action may never be invoked.  It is only when 
such preliminary statements or the claims or defences embodied in them 
form the basis or the subject of some hearing before, or some action  by, a 
court or a judicial officer, that their contents can become the object of any 
real public concern as touching the public administration of justice.

152 In Edmonton Journal, supra, at pp. 1338-40, I noted that the public scrutiny of our 
courts by the press was fundamentally important in our democratic society and that 
s. 2(b) protected not only speakers, but listeners as well.  This right to report on 
court proceedings extended to pleadings and court documents filed before trial, since 
access to these documents served the same societal needs as reporting on trials.  Even 
in private actions, such as those for wrongful dismissal or for personal damages, the 
public may well have an interest in knowing the kinds of submissions which can be 
put forward.

153 Both societal standards and the legislation have changed with regard to access to court 
documents.  When the qualified privilege rule was set out in Shallow, supra, court 
documents were not open to the public.  Today, the right of access is guaranteed by 
legislative provision, in this case s. 137(1) of the Courts of Justice Act, R.S.O. 1990, 
c. C.43.  As well, s. 2(b) of the Charter may in some circumstances provide a basis 
for gaining access to some court documents.  However, just as s. 137(1) provides for 
limitations on the right of access to court documents, so too is the s. 2(b) guarantee 
subject to reasonable limits that can be demonstrably justified in a free and democratic 
society.  This Court's reasons in Canadian Newspapers Co. v. Canada (Attorney 
General), [1988] 2 S.C.R. 122, provide an illustration of the kind of restriction that 
has been upheld in relation to information flowing from court proceedings.  In that 
case, the constitutionality of s. 442(3) of the Criminal Code was upheld.  It imposed 
a publication ban on the identity of a complainant in sexual assault cases (or any 
information that might disclose her identity) upon the request of that complainant.  
There is no need to elaborate further on the scope of access, however, since it does 
not arise on the facts of this case.  It is sufficient to observe that, in appropriate 
circumstances, s. 2(b) may provide the means to gain access to court documents.  It 
follows that the concept of qualified privilege should be modified accordingly.

154 The public interest in documents filed with the court is too important to be defeated 
by the kind of technicality which arose in this case.  The record demonstrates that, 
prior to holding the press conference, Morris Manning had every intention of 
initiating the contempt action in accordance with the prevailing rules, and had given 
instructions to this effect.  In fact, the proper documents were served and filed the 
very next morning.  The fact that, by some misadventure, the strict procedural 
requirement of filing the documents had not been fulfilled at the time of the press 
conference, should not defeat the qualified privilege which attached to this occasion.

155 This said, it is my conclusion that Morris Manning's conduct far exceeded the 
legitimate purposes of the occasion.  The circumstances of this case called for great 
restraint in the communication of information concerning the proceedings launched 
against Casey Hill.  As an experienced lawyer, Manning ought to have taken steps to 
confirm the allegations that were being made.  This is particularly true since he should 
have been aware of the Scientology investigation pertaining to access to the sealed 
documents.  In those circumstances he was duty bound to wait until the investigation 
was completed before launching such a serious attack on Hill's professional integrity.  
Manning failed to take either of these reasonable steps.  As a result of this failure, the 
permissible scope of his comments was limited and the qualified privilege which 
attached to his remarks was defeated.

156 The press conference was held on the steps of Osgoode Hall in the presence of 
representatives from several media organizations.  This constituted the widest 
possible dissemination of grievous allegations of professional misconduct that were 
yet to be tested in a court of law.  His comments were made in language that 
portrayed Hill in the worst possible light.  This was neither necessary nor 
appropriate in the existing circumstances.  While it is not necessary to characterize 
Manning's conduct as amounting to actual malice, it was certainly highhanded and 
careless.  It exceeded any legitimate purpose the press conference may have served.  
His conduct, therefore, defeated the qualified privilege that attached to the occasion.

(B)  Damages


(1)
The Standard of Appellate Review

157 The appellants do not contend that the trial judge made any substantive error in his 
careful directions to the jury.  Thus, there is no question of misdirection of the jury or 
of its acting upon an improper basis or of any jury consideration given to wrongfully 
admitted or excluded evidence.  The sole issue is whether the quantum of the jury's 
award can stand.

158 Jurors are drawn from the community and speak for their community.  When 
properly instructed, they are uniquely qualified to assess the damages suffered by the 
plaintiff, who is also a member of their community.  This is why, as Robins J.A. 
noted in Walker v. CFTO Ltd. (1987), 59 O.R. (2d) 104 (C.A.) at p. 110, it is often 
said that the assessment of damages is "peculiarly the province of the jury".  
Therefore, an appellate court is not entitled to substitute its own judgment as to the 
proper award for that of the jury merely because it would have arrived at a different 
figure.

159 The basis upon which an appellate court can act was very clearly enunciated by 
Robins J.A. in Walker, supra.  He stated at p. 110 that the court should consider:


. . . whether the verdict is so inordinately large as obviously to exceed the 
maximum limit of a reasonable range within which the jury may properly 
operate or, put another way, whether the verdict is so exorbitant or so 
grossly out of proportion to the libel as to shock the court's conscience 
and sense of justice.

160 The history of this action emphasizes the reasonableness of the jury's verdict.  It was 
the appellants who had always insisted upon the jury assessing damages for the libel. 
 When the jury had retired to consider their verdict, they returned after four hours 
with the sagacious question "what, if any, are realistic maximums that have been 
assessed by society in recent history".  The trial judge prudently sought the advice of 
counsel on the question.  Counsel for the appellants agreed with the trial judge that no 
guidance could be given to the jury as to the quantum of damages.  The jury was so 
advised.  They deliberated for another five hours and returned the verdict which is the 
subject matter of this appeal.

161 There can be no doubt that the decision of the trial judge on this issue which was 
concurred in by the counsel for the appellants, was correct.  In Ontario, there is no 
statutory provision for giving guidelines to a jury on this issue.  It is significant that in 
1989, when the Courts of Justice Act was amended (S.O. 1989, c. 67, s. 4) to permit 
trial judges and counsel to give guidance to juries concerning damage awards in 
personal injury actions, no provision was made in the Act pertaining to libel actions 
or any other type of tort action.  It would appear, then, that the legislators 
specifically left the assessment of damages in libel actions to the jury.

162 The appellants relied upon the case of Rantzen v. Mirror Group Newspapers (1986) 
Ltd., [1993] 4 All E.R. 975 (C.A.) to support their position that an appellate court 
should reduce this award.  In that case, however, the English Court of Appeal, was 
acting pursuant to newly enacted legislation.  This legislation, passed in 1990, 
specifically provided that, in cases where the court had the authority to order a new 
trial on the ground that the damages awarded by a jury were excessive or inadequate, it 
could, instead of ordering a new trial, substitute a sum for damages which it 
considered to be proper.  This statutory provision led the court in Rantzen to modify 
its approach to the review of a jury's assessment of damages.  Therefore, this case is 
of little use.

163 If guidelines are to be provided to juries, then clearly this is a matter for legislation.  In 
its absence, the standard which must be applied remains that the jury's assessment 
should not be varied unless it shocks the conscience of the court.  With this in mind, 
let us first consider the jury's assessment of damages.


(2)
General Damages

164 It has long been held that general damages in defamation cases are presumed from the 
very publication of the false statement and are awarded at large.  See Ley v. Hamilton 
(1935), 153 L.T. 384 (H.L.), at p. 386.  They are, as stated, peculiarly within the 
province of the jury.  These are sound principles that should be followed.

165 The consequences which flow from the publication of an injurious false statement are 
invidious.  The television report of the news conference on the steps of Osgoode Hall 
must have had a lasting and significant effect on all who saw it.  They witnessed a 
prominent lawyer accusing another lawyer of criminal contempt in a setting 
synonymous with legal affairs and the courts of the province.  It will be extremely 
difficult to correct the impression left with viewers that Casey Hill must have been 
guilty of unethical and illegal conduct.

166 The written words emanating from the news conference must have had an equally 
devastating impact.  All who read the news reports would be left with a lasting 
impression that Casey Hill has been guilty of misconduct.  It would be hard to 
imagine a more difficult situation for the defamed person to overcome.  Every time 
that person goes to the convenience store, or shopping centre, he will imagine that the 
people around him still retain the erroneous impression that the false statement is 
correct.  A defamatory statement can seep into the crevasses of the subconscious and 
lurk there ever ready to spring forth and spread its cancerous evil.  The unfortunate 
impression left by a libel may last a lifetime.  Seldom does the defamed person have 
the opportunity of replying and correcting the record in a manner that will truly 
remedy the situation.  It is members of the community in which the defamed person 
lives who will be best able to assess the damages.  The jury as representative of that 
community should be free to make an assessment of damages which will provide the 
plaintiff with a sum of money that clearly demonstrates to the community the 
vindication of the plaintiff's reputation.


(a)
Should a Cap be Imposed on Damages in Defamation Cases

167 The appellants contend that there should be a cap placed on general damages in 
defamation cases just as was done in the personal injury context.  In the so-called 
"trilogy" of Andrews v. Grand & Toy Alberta Ltd., [1978] 2 S.C.R. 229, Arnold v. 
Teno, [1978] 2 S.C.R. 287, and Thornton v. Board of School Trustees of School Dist. 
No. 57 (Prince George), [1978] 2 S.C.R. 267, it was held that a plaintiff claiming 
non-pecuniary damages for personal injuries should not recover more than $100,000.

168 In my view, there should not be a cap placed on damages for defamation.  First, the 
injury suffered by a plaintiff as a result of injurious false statements is entirely 
different from the non-pecuniary damages suffered by a plaintiff in a personal injury 
case.  In the latter case, the plaintiff is compensated for every aspect of the injury 
suffered:  past loss of income and estimated future loss of income, past medical care 
and estimated cost of future medical care, as well as non-pecuniary damages.  Second, 
at the time the cap was placed on non-pecuniary damages, their assessment had 
become a very real problem for the courts and for society as a whole.  The damages 
awarded were varying tremendously not only between the provinces but also between 
different districts of a province.  Perhaps as a result of motor vehicle accidents, the 
problem arose in the courts every day of every week.  The size and disparity of 
assessments was affecting insurance rates and, thus, the cost of operating motor 
vehicles and, indeed, businesses of all kinds throughout the land.  In those 
circumstances, for that one aspect of recovery, it was appropriate to set a cap.

169 A very different situation is presented with respect to libel actions.  In these cases, 
special damages for pecuniary loss are rarely claimed and often exceedingly difficult to 
prove.  Rather, the whole basis for recovery for loss of reputation usually lies in the 
general damages award.  Further, a review of the damage awards over the past 
nine years reveals no pressing social concern similar to that which confronted the 
courts at the time the trilogy was decided.  From 1987 to 1991, there were only 27 
reported libel judgments in Canada, with an average award of $30,000.  Subsequent to 
the decision in this case, from 1992 to 1995, there have been 24 reported libel 
judgments, with an average award of less than $20,000.  This later figure does not 
include the award in Jill Fishing Ltd. v. Koranda Management Inc., [1993] B.C.J. No. 
1861 (S.C.) which involved the assessment of damages for a number of different 
causes of action.  Therefore, there is no indication that a cap is required in libel cases.

170 There is a great difference in the nature of the tort of defamation and that of 
negligence.  Defamation is the intentional publication of an injurious false statement.  
While it is true that an actual intention to defame is not necessary to impose liability 
on a defendant, the intention to do so is nevertheless inferred from the publication of 
the defamatory statement.  This gives rise to the presumption of malice which may be 
displaced by the existence of a qualified privilege.  Personal injury on the other hand, 
results from negligence which does not usually arise from any desire to injure the 
plaintiff.  Thus, if it were known in advance what amount the defamer would be 
required to pay in damages (as in the personal injury context), a defendant might look 
upon that sum as the maximum cost of a licence to defame.  A cap would operate in a 
manner that would change the whole character and function of the law of defamation.  
It would amount to a radical change in policy and direction for the courts.

171 The courts in England have unequivocally rejected the comparison of libel and 
personal injury cases.  See, for example, Cassell & Co. Ltd. v. Broome, [1972] 1 All 
E.R. 801 at p. 824 (C.A.); Blackshaw v. Lord, [1984] 1 Q.B. 1, 2 All E.R. 311 at 
p. 337, 340 (C.A.); Sutcliffe v. Pressdram Ltd., [1990] 1 All E.R. 269 at pp. 281-82, 
289 (C.A.); and Rantzen v. Mirror Group Newspapers (1986) Ltd., supra.

172 It is true that in Australia a majority of the High Court held in Carson v. John Fairfax 
& Sons Ltd. (1993), 113 A.L.R. 577 (H.C.) that some useful reference could be made 
to personal injury cases in assessing general damages.  However, the 4-3 division in 
the court shows the serious concern which this issue engendered.  McHugh J., a 
member of the minority, wrote (at p. 629):


Awards in personal injury cases and defamation actions serve different 
purposes, have different elements and different histories.  They are not 
comparable.  I think that it is a mistake to believe that the pain and 
suffering component of a personal injury award can be isolated from the 
other components of that award and then compared to an award of 
compensatory damages in a defamation.

173 In any event, I would observe that, if the trilogy were to be applied, the value of the 
cap in 1991 would be approximately $250,000.  It follows that even if the appellants' 
contention on this issue was accepted, the general damages of $300,000 assessed by 
the jury would come very close to the range said to be reasonable by the appellants.


(b)
Joint Liability for General Damages

174 Manning complains that the judge erred in refusing to accept his request that the 
verdict in general damages be rendered separately.  He argues that his liability should 
be limited to the statement he made at the press conference and should not extend to 
the subsequent circulation of the notice of motion.  The trial judge's error, he argues, 
contributed to the very high award by the jury.  This position cannot be accepted.

175 It must be remembered that at trial:  a) it was the position of Manning's counsel that 
Manning and Scientology should be jointly and severally liable for general damages in 
respect of each of the defamatory statements published by them; b) Scientology 
admitted that it published each of the defamatory statements at issue in the action; c) 
Manning admitted that he published each of the defamatory statements with the 
exception of the notice of motion; and d) the jury specifically found that Manning 
published the notice of motion.

176 Thus, both Manning and Scientology published the notice of motion.  It is a 
well-established principle that all persons who are involved in the commission of a 
joint tort are jointly and severally liable for the damages caused by that tort.  If one 
person writes a libel, another repeats it, and a third approves what is written, they all 
have made the defamatory libel.  Both the person who originally utters the 
defamatory statement, and the individual who expresses agreement with it, are liable 
for the injury.  It would thus be inappropriate and wrong in law to have a jury 
attempt to apportion liability either for general or for special damages between the 
joint tortfeasors Manning and Scientology.  See Lawson v. Burns, [1976] 6 W.W.R. 
362 (B.C.S.C.), at pp. 368-69; Gatley on Libel and Slander (8th ed.), supra, at p. 600. 
 However, this comment does not apply to aggravated damages, which are assessed on 
the basis of the particular malice of each joint tortfeasor.


(c)
Application of Principles to the Facts Established in this Case

177 It cannot be forgotten that at the time the libelous statement was made, Casey Hill 
was a young lawyer in the Crown Law office working in the litigation field.  For all 
lawyers their reputation is of paramount importance.  Clients depend on the integrity 
of lawyers, as do colleagues.  Judges rely upon commitments and undertakings given 
to them by counsel.  Our whole system of administration of justice depends upon 
counsel's reputation for integrity.  Anything that leads to the tarnishing of a 
professional reputation can be disastrous for a lawyer.  It matters not that subsequent 
to the publication of the libel, Casey Hill received promotions, was elected a bencher 
and eventually appointed a trial judge in the General Division of the Court of Ontario. 
 As a lawyer, Hill would have no way of knowing what members of the public, 
colleagues, other lawyers and judges may have been affected by the dramatic 
presentation of the allegation that he had been instrumental in breaching an order of 
the court and that he was guilty of criminal contempt.

178 This nagging doubt and sense of hurt must have affected him in every telephone call 
he made and received in the course of his daily work, in every letter that he sent and 
received and in every appearance that he made before the courts of the province of 
Ontario.  He would never know who, as a result of the libellous statement, had some 
lingering suspicion that he was guilty of misconduct which was criminal in nature.  He 
would never know who might have believed that he was a person without integrity 
who would act criminally in the performance of his duties as a Crown counsel.  He 
could never be certain who would accept the allegation that he was guilty of a criminal 
breach of trust which was the essential thrust of the libel.

179 The publication of the libellous statement was very carefully orchestrated.  Members 
of the press and the television media attended at Osgoode Hall in Toronto to meet 
two prominent lawyers, Morris Manning and Clayton Ruby.  Osgoode Hall is the 
seat of the Court of Appeal and the permanent residence of the Law Society.  The 
building is used as the background in a great many news reports dealing with 
important cases emanating from the Court of Appeal.  In the minds of the public, it is 
associated with the law, with the courts and the justice system.  Manning went far 
beyond a simple explanation of the nature of the notice of motion.  He took these 
very public steps without investigating in any way whether the allegations made were 
true.

180 At the time this press conference was called, Scientology members had been working 
with the sealed documents for some time and they had not yet discovered any of the 
sealed documents to have been opened.  Yet, Scientology persisted in the publication 
of this libel against Hill who was listed in their files as an "enemy".

181 Hill movingly described the affect of the reading of the press reports of the press 
conference had upon him and of viewing the television broadcast.  He put it in this 
way:



I was sick.  I was shocked.  I understood from reading it that it related 
to access to the documents.  The type of thing that Mr. Ruby and I had 
been dealing with over many months, and I was just incredulous.


. . .



I was horrified when I saw it.  I had had a long history of dealing with 
counsel for the Church of Scientology.  Small problems, medium-sized 
problems and very serious problems had been raised between us.



Every effort was made to answer those issues as they came up.  
When I saw the newscast, I realized that there was really nothing I could 
do to stop the information from getting out.  I thought it was false.  I 
thought it was a very dramatic representation .  A well-known lawyer as 
Mr. Manning was -- and he was gowned.


. . .



And he was standing before the High Court.  The indication that I had 
been involved in opening sealed documents and giving permission was 
totally false.  For me, in seeing it, it was equivalent to saying I was a cheat 
and that I had obstructed the course of justice.  It was an attack on my 
professional reputation and I had no way of stopping it.


. . .



I also have no way of knowing whether there are people in the 
community who would be in a position to place some reliance on the fact 
that regardless of the outcome of the criminal case. Manning, a prominent 
lawyer, and the Church of Scientology of Toronto, had still expressed a 
view on September 17th.

182 The factors which should be taken into account in assessing general damages are 
clearly and concisely set out in Gatley on Libel and Slander (8th ed.), supra, at 
pp. 592-93 in these words:


Section 1.  Assessment of Damages



1451.  Province of the Jury.  In an action of libel "the assessment of 
damages does not depend on any legal rule".  The amount of damages is 
"peculiarly the province of the jury," who in assessing them will naturally 
be governed by all the circumstances of the particular case.  They are 
entitled to take into their consideration the conduct of the plaintiff, his 
position and standing, the nature of the libel, the mode and extent of 
publication, the absence or refusal of any retraction or apology, and "the 
whole conduct of the defendant from the time when the libel was 
published down to the very moment of their verdict.  They may take into 
consideration the conduct of the defendant before action, after action, and 
in court at the trial of the action," and also, it is submitted, the conduct of 
his counsel, who cannot shelter his client by taking responsibility for the 
conduct of the case.  They should allow "for the sad truth that no 
apology, retraction or withdrawal can ever be guaranteed completely to 
undo the harm it has done or the hurt it has caused."  They should also 
take into account the evidence led in aggravation or mitigation of the 
damages.

183 There will of necessity be some overlapping of the factors to be considered when 
aggravated damages are assessed.  This can be seen from a further reference to the 
Gatley text at pp. 593-4 where this appears:



1452.  Aggravated damages.  The conduct of the defendant, his 
conduct of the case, and his state of mind are thus all matters which the 
plaintiff may rely on as aggravating the damages.  "Moreover, it is very 
well established that in cases where the damages are at large the jury (or 
the judge if the award is left to him) can take into account the motives and 
conduct of the defendant where they aggravate the injury done to the 
plaintiff.  There may be malevolence or spite or the manner of committing 
the wrong may be such as to injure the plaintiff's proper failings of 
dignity and pride.  These are matters which the jury can take into account 
in assessing the appropriate compensation."  "In awarding `aggravated 
damages' the natural indignation of the court at the injury inflicted on the 
plaintiff is a perfectly legitimate motive in making a generous, rather than 
a more moderate award to provide an adequate solatium . . . that is 
because the injury to the plaintiff is actually greater, as the result of the 
conduct exciting the indignation, demands a more generous solatium."

184 In considering and applying the factors pertaining to general damages in this case it 
will be remembered that the reports in the press were widely circulated and the 
television broadcast had a wide coverage.  The setting and the persons involved gave 
the coverage an aura of credibility and significance that must have influenced all who 
saw and read the accounts.  The insidious harm of the orchestrated libel was indeed 
spread widely throughout the community.

185 The misconduct of the appellants continued after the first publication.  Prior to the 
commencement of the hearing of the contempt motion before Cromarty J., 
Scientology was aware that the allegations it was making against Casey Hill were 
false.  Yet, it persisted with the contempt hearings as did Morris Manning.  At the 
conclusion of the contempt hearing, both appellants were aware of the falsity of the 
allegations.  Nonetheless, when the libel action was instituted, the defence of 
justification was put forward by both of them.  The statement of defence alleging 
justification or truth of the allegation was open for all the public to see.  Despite their 
knowledge of its falsity, the appellants continued to publish the libel.  Although 
Manning withdrew the plea of justification, this was only done in the week prior to 
the commencement of the trial itself.  For its part, Scientology did not withdraw its 
plea of justification until the hearing of the appeal.  Finally, the manner in which Hill 
was cross-examined by the appellants, coupled with the manner in which they 
presented their position to the jury, in light of their knowledge of the falsity of their 
allegations, are further aggravating factors to be taken into account.

186 When all these facts are taken into account there is no question that the award of 
$300,000 by way of general damages was justified in this case.


(d)
Comparison with Other Libel Cases

187 At the outset, I should state that I agree completely with the Court of Appeal that 
each libel case is unique and that this particular case is in a "class by itself".  The 
assessment of damages in a libel case flows from a particular confluence of the 
following elements:  the nature and circumstances of the publication of the libel, the 
nature and position of the victim of the libel, the possible effects of the libel statement 
upon the life of the plaintiff, and the actions and motivations of the defendants.  It 
follows that there is little to be gained from a detailed comparison of libel awards.


(3)
Aggravated Damages


(a)
General Principles

188 Aggravated damages may be awarded in circumstances where the defendants' conduct 
has been particularly high-handed or oppressive, thereby increasing the plaintiff's 
humiliation and anxiety arising from the libellous statement.  The nature of these 
damages was aptly described by Robins J.A. in Walker v. CFTO Ltd., supra, in these 
words at p. 111:


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".

189 These damages take into account the additional harm caused to the plaintiff's feelings 
by the defendant's outrageous and malicious conduct.  Like general or special damages, 
they are compensatory in nature.  Their assessment requires consideration by the jury 
of the entire conduct of the defendant prior to the publication of the libel and 
continuing through to the conclusion of the trial.  They represent the expression of 
natural indignation of right-thinking people arising from the malicious conduct of the 
defendant.

190 If aggravated damages are to be awarded, there must be 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, 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. 
 The malice may be established by intrinsic evidence derived from the libellous 
statement itself and the circumstances of its publication, or by extrinsic evidence 
pertaining to the surrounding circumstances  which demonstrate that the defendant 
was motivated by an unjustifiable intention to injure the plaintiff.  See Taylor v. 
Despard, supra, at p. 975.

191 There are a number of factors that a jury may properly take into account in assessing 
aggravated damages.  For example, 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?


(b)
The Application to the Facts of this Case

192 In this case, there was ample evidence upon which the jury could properly base their 
finding of aggravated damages.  The existence of the file on Casey Hill under the 
designation "Enemy Canada" was evidence of the malicious intention of Scientology 
to "neutralize" him.  The press conference was organized in such a manner as to 
ensure the widest possible dissemination of the libel.  Scientology continued with the 
contempt proceedings although it knew its allegations were false.  In its motion to 
remove Hill from the search warrant proceedings, it implied that he was not 
trustworthy and might act in those proceedings in a manner that would benefit him in 
his libel action.  It pleaded justification or truth of its statement when it knew it to be 
false.  It subjected Hill to a demeaning cross-examination and, in its address to the 
jury, depicted Hill as a manipulative actor.

193 It is, as well, appropriate for an appellate court to consider the post-trial actions of 
the defendant.  It will be recalled that Scientology, immediately after the verdict of the 
jury, repeated the libel, thus forcing the plaintiff to seek and obtain an injunction 
restraining Scientology from repeating the libel.  It did not withdraw its plea of 
justification until the hearing of the appeal.  All this indicates that the award of 
aggravated damages was strongly supported by the subsequent actions of Scientology.

194 In summary, every aspect of this case demonstrates the very real and persistent 
malice of Scientology.  Their actions preceding the publication of the libel, the 
circumstances of its publication and their subsequent actions in relation to both the 
search warrant proceedings and this action amply confirm and emphasize the 
insidious malice of Scientology.  Much was made of their apology tendered at the time 
of the hearing in the Court of Appeal.  There is a hollow ring to that submission when 
it is remembered that it was not until the fifth day of oral argument before the Court 
of Appeal that the apology was tendered.  Scientology can gain little comfort from 
such a late and meaningless apology.

195 These damages were awarded solely against Scientology and are based upon the 
misconduct of that appellant.  There is no question of Manning being in any way 
responsible for these damages.  Indeed, there cannot be joint and several responsibility 
for either aggravated or punitive damages since they arise from the misconduct of the 
particular defendant against whom they are awarded.  See, for example, Sun Life, 
supra, at p. 1310; Egger v. Chelmsford, [1965] 1 Q.B. 248 (C.A.), at pp. 263 and 
265; Vogel, supra, at p. 171; S. M. Waddams, The Law of Damages (2nd ed. 1991), at 
pp. 11-23 - 11-24.  Scientology's behaviour throughout can only be characterized as 
recklessly high-handed, supremely arrogant and contumacious.  There seems to have 
been a continuing conscious effort on Scientology's part to intensify and perpetuate 
its attack on Casey Hill without any regard for the truth of its allegations.


(4)
Punitive Damages


(a)
General Principles

196 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.

197 Unlike compensatory damages, punitive damages are not at large.  Consequently, 
courts have a much greater scope and discretion on appeal.  The appellate review 
should be based upon the court's estimation as to whether the punitive damages serve 
a rational purpose.  In other words, was the misconduct of the defendant so 
outrageous that punitive damages were rationally required to act as deterrence?

198 This was the test formulated by Robins J.A. in Walker v. CFTO Ltd., supra.  In that 
case, he found that the general damages award of $908,000 was obviously sufficient to 
satisfy whatever need there was for punishment and deterrence.  He found that, in 
those circumstances, the $50,000 punitive damage award served no rational purpose.  
The Court of Appeal, in the case at bar, applied the same reasoning and upheld the 
award of punitive damages.

199 Punitive damages can and do serve a useful purpose.  But for them, it would be all too 
easy for the large, wealthy and powerful to persist in libelling vulnerable victims.  
Awards of general and aggravated damages alone might simply be regarded as a licence 
fee for continuing a character assassination.  The protection of a person's reputation 
arising from the publication of false and injurious statements must be effective.  The 
most effective means of protection will be supplied by the knowledge that fines in the 
form of punitive damages may be awarded in cases where the defendant's conduct is 
truly outrageous.


(b)
The Application to the Facts of this Case

200 There can be no doubt that the conduct of Scientology in the publication of the 
injurious false statement pertaining to its "enemy" was malicious.  Its publication was 
carefully planned and carried out in a manner which ensured its widest possible 
dissemination in the most damaging manner imaginable.  The allegation made against 
Hill was devastating.  It was said that he had been guilty of breach of trust, breach of a 
court order and that his conduct and behaviour was criminal.  Scientology's actions 
from the time of publication, throughout the trial, and after the trial decision was 
rendered constituted a continuing attempt at character assassination by means of a 
statement which it knew to be false.  It was such outrageous conduct that it cried out 
for the imposition of punitive damages.

201 There might have been some concern that, in light of the award of general and 
aggravated damages totalling $800,000, there might not be a rational basis for punitive 
damages.  However any lingering doubt on that score is resolved when Scientology's 
persistent misconduct subsequent to the trial is considered.  On the very next day 
following the verdict, Scientology republished the libel in a press release delivered to 
the media.  It then brought a motion to adduce fresh evidence which it stated would 
have "a bearing on the reputation and credibility of the plaintiff S. Casey Hill" which, 
if presented at trial, "would probably have changed the result".  Its actions were such 
that Hill was forced to bring an application for an injunction enjoining Scientology 
from republishing the libel.  In his reasons for granting the injunction, Carruthers J. 
stated that he was forced to take that action because "no amount awarded on account 
of punitive damages would have prevented or will prevent the Church of Scientology, 
from publishing defamatory statements about the plaintiff".  Even the injunction did 
not deter Scientology which moved to set it aside.  Further, in its notice of appeal of 
the libel judgment, Scientology alleged that the trial judge had erred in ruling the 
decision of Cromarty J. in the contempt proceedings was res judicata of the issues 
raised in the libel trial.

202 During the appeal, it was conceded and the evidence and events confirmed that in all 
likelihood, no amount of general or aggravated damages would have deterred 
Scientology.  Clearly then, this was an appropriate case for an award of punitive 
damages.  Scientology did not withdraw its plea of justification until the first day of 
the oral argument in the Court of Appeal.  Nor was any apology tendered by 
Scientology until the fifth day of oral argument before the Court of Appeal.

203 The award of punitive damages, therefore, served a rational purpose in this case.  
Further, the circumstances presented in this exceptional case demonstrate that there 
was such insidious, pernicious and persistent malice that the award for punitive 
damages cannot be said to be excessive.  Scientology has alleged that the size of the 
award of punitive damages had a chilling effect on its right to freedom of expression.  
However as stated earlier, in spite of the slow and methodical progress of this case to 
trial and appeal, and despite the motion brought six years before the trial which drew 
attention to the need for evidence, Scientology adduced no evidence as to the chilling 
affect of the award.  In its absence, this argument should not be considered.  It may be 
that different factors will have to be taken into consideration where evidence is 
adduced and where a member of the media is a party to the action.  However, those 
are considerations for another case on another day.

IV.  Disposition

204 The appeal is dismissed with costs.
205 



APPENDIX A


CFTO BROADCAST



The Toronto Church of Scientology has filed charges of contempt of court against 
two provincial lawyers.  The Church believes the lawyers violated a court order by 
opening sealed documents which were seized last year in a raid on the Church's 
headquarters.  A report from CFTO's Tim Webber:

Webber:


Eighteen months ago, more than one hundred O.P.P. officers stormed out of three 
buses and into the offices of the Church of Scientology.  They seized hundreds 
of thousands of documents in two days of searching.  Police said they were 
looking for evidence of tax fraud, consumer fraud and other indictable offences. 
 Many of these seized documents were deemed confidential by the Church.  
Some they said were confessions between priests and penitents and they 
convinced a judge to order about two hundred of the documents sealed.  
Today, lawyers for the Church filed charges alleging that the sealing order has 
been violated.

Manning:


The documents were ordered sealed by Mr. Justice Osler, pursuant to a request 
by counsel, in a very serious matter, and they were opened and revealed to 
persons whom we say were unauthorized to so do.

Webber:


The charges are against Jerome Cooper, a lawyer for Consumer and Commercial 
Relations, and Crown Attorney S. Casey Hill.  The documents filed today 
alleged that the two convinced another Supreme Court Justice to allow the 
Ministry of Consumer and Commercial Relations to view the sealed 
documents in the company of O.P.P. officers.  One of the lawyers being 
charged, Jerome Cooper, today told us he had absolutely no comment on the 
matter.  The trial date has already been set for the 17th of January, but 
lawyers for the Church of Scientology are hoping to convince the defendants 
and the Court so start even sooner.





APPENDIX B


CBC BROADCAST



The Church of Scientology has filed a suit against two Toronto based Crown 
Attorneys.  The Church had its offices raided by police and documents seized in 
March of 1983.  Lawyers for the Church say those documents were opened and read 
by persons not authorized to do so.

Manning:


They were confidential documents which have been ordered sealed by Supreme 
Court of Ontario Justices which were opened with the permission of counsel 
for the Crown.  And this constitutes, in the opinion of the Church, a contempt 
of court.  We've had a date set in January.  But hopefully, we can get a date set 
earlier with the consent of the Chief Justice of the Trial Division, or the chief 
Justice of Ontario on the basis that it's a very important matter.  It's important 
to the administration of justice.




APPENDIX C


GLOBE AND MAIL



The Church of Scientology of Toronto is asking the Supreme Court of Ontario to 
find a Crown prosecutor and a lawyer with the Ontario Ministry of Consumer and 
Commercial Relations in contempt of court.


Morris Manning, a lawyer acting for the church, said in an interview yesterday 
that he has filed a motion asking for S. Casey Hill, a prosecutor with the Ontario 
Ministry of the Attorney-General, and Jerome Cooper, a lawyer with the Consumer 
Ministry, to be jailed or fined.


The motion claims that Mr. Cooper misled Mr. Justice Jean-Charles Sirois of the 
Supreme Court of Ontario into releasing to the Consumer Ministry documents seized 
by the Ontario Provincial Police in a raid on the Church's headquarters.


The motion says Judge Sirois was not told that many of the documents had been 
ordered sealed by another Ontario Supreme Court judge while the Church contests the 
legality of the search warrant used by the O.P.P. in the raid last year.


The motion claims Mr. Hill, who represented the Attorney-General during the 
search warrant hearings "aided and abetted in the misleading of Mr. Justice Sirois".


A hearing on the motion has been set for January 17.




L'HEUREUX-DUBE J.:




205 
I have had the advantage of reading the reasons of my colleague Justice 
Cory and, except on one point, generally agree with them as well as with his 
disposition of this appeal.  

206 
First, however, in order to dispel any possible confusion regarding the 
applicability of the Canadian Charter of Rights and Freedoms to the common law, I 
note that this issue can be easily summarized in the following two principles, both of 
which were first articulated by McIntyre J. in RWDSU v. Dolphin Delivery Ltd., 
[1986] 2 S.C.R. 573:


1.
The Charter does not directly apply to the common law unless it is 
the basis of some governmental action.


2.
Even though the Charter does not directly apply to the common law 
absent government action, the common law must nonetheless be 
developed in accordance with Charter values.  (To the same effect, 
see R. v. Salituro, [1991] 3 S.C.R. 654, Dagenais v. Canadian 
Broadcasting Corp., [1994] 3 S.C.R. 835, and R. v. Park, S.C.C. No. 
23876, June 22, 1995, per L'Heureux-Dube J.). 

In other words, the basic rule is that, absent government action, the Charter only 
applies indirectly to the common law.

207 
In light of the above, I agree with Cory J. that where the common law is 
"challenged" on Charter grounds, a traditional s. 1 analysis will generally not be 
appropriate.  Instead, "Charter values, framed in general terms, should be weighed 
against the principles which underlie the common law.  The Charter values will then 
provide the guidelines for any modification to the common law which the court feels 
is necessary" (para. 97).  As well, I agree with Cory J. that "the party who is alleging 
that the common law is inconsistent with the Charter should bear the onus of proving 
both that the common law fails to comply with Charter values and that, when these 
values are balanced, the common law should be modified" (para. 98).  Such an 
approach is, in my view, consistent with the fact that, absent government action, the 
Charter only applies indirectly to the common law.  

208 
Applying this approach in the case at hand, I agree with Cory J.'s 
conclusion that the common law of defamation, as it is applied to the parties in this 
action, is consistent with the values enshrined in the Charter.  Accordingly, I agree 
with my colleague that there is no need to amend or alter the common law.  In 
particular, I agree that the "actual malice" rule adopted by the U.S. Supreme Court in 
New York Times v. Sullivan, 376 U.S. 254 (1964), should not be adopted into the 
Canadian common law of defamation.

209 
Second, the one issue on which I part company with my colleague 
concerns the scope of the defence of qualified privilege.  Traditionally, this Court has 
held that the defence of qualified privilege is available with respect to reports of 
judicial proceedings, but not with respect to reports of pleadings in purely private 
litigation upon which no judicial action has yet been taken: Gazette Printing Co. v. 
Shallow (1909), 41 S.C.R. 339.  The appellants, however, argue that Shallow is no 
longer good law as it had been overtaken by this Court's more recent decision in 
Edmonton Journal v. Alberta (Attorney General), [1989] 2 S.C.R. 1326.  My colleague 
appears to accept this argument.  Accordingly, he broadens the scope of the defence 
of qualified privilege, making it available with respect to reports of pleadings upon 
which no judicial action has yet been taken.  I disagree.  In my view, Shallow and 
Edmonton Journal are entirely consistent.  In this respect, I adopt the following 
statement from the judgment of the Court of Appeal in the case at hand ((1994), 18 
O.R. (3d) 385, at p. 427):



We were urged to extrapolate from Edmonton Journal the proposition 
that the common law of defamation should respect such constitutional 
forms of expression as the reporting of information pertaining to intended 
court proceedings by conferring qualified privilege on the occasion of the 
publication of such reports.  With respect, we do not agree.  Edmonton 
Journal struck down, in the name of freedom of expression, statutory 
provisions which sought to inhibit the publication of details of pending 
matrimonial and other civil actions.  But it by no means follows that the 
publication of such details should be accorded the mantle of qualified 
privilege if they are defamatory.



Edmonton Journal and Gazette Printing stand together without 
conflict: there is a right to publish details of judicial proceedings before 
they are heard in open court, but such publication does not enjoy the 
protection of qualified privilege if it is defamatory.  As Duff J. noted in 
the extract from p. 364 of Gazette Printing set out above, no such 
privilege is necessary if the statements published are true, and no such 
privilege is desirable if they are not true.

210 
Subject to the above, I would dispose of this appeal as does my colleague 
Cory J.
211 



Appeal dismissed with costs.


Solicitors for the appellant Morris Manning:  Weir & Foulds, Toronto.


Solicitors for the appellant the Church of Scientology of 
Toronto:  Gowling, Strathy & Henderson, Kitchener.


Solicitors for the respondent:  Tory Tory DesLauriers & Binnington, 
Toronto.


Solicitor for the intervener the Attorney General for Ontario:  The 
Ministry of the Attorney General, Toronto.


Solicitors for the intervener the Canadian Civil Liberties 
Association:  Robert Sharpe and Kent Roach, Toronto.


Solicitors for the interveners the Writers' Union of Canada, PEN Canada, 
Canadian Association of Journalists, Periodical Writers Association of Canada, and 
Book and Periodical Council:  Davies, Ward & Beck, Toronto.


Solicitors for the interveners the Canadian Daily Newspaper Association, 
Canadian Community Newspapers Association, Canadian Association of 
Broadcasters, Radio-Television News Directors Association of Canada, Canadian 
Book Publishers' Council and Canadian Magazine Publishers' Association:  Blake, 
Cassels & Graydon, Toronto.