Kent v. Postmedia Network Inc., 2012 ABQB 559

Court of Queen ’ s Bench of Alberta Citation: Kent v. Postmedia Network Inc., 2012 ABQB 559 Date: 20120914 Docket: 1001 16418 Registry: Calgary Between: Arthur Kent Plaintiff/Respondent - and - Postmedia Network Inc., National Post Inc., Paul Godfrey and Gordon Fisher Defendants/Applicants _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice W. A.

Tilleman _______________________________________________________ Introduction [ 1 ] In a case alleging defamation, the Plaintiff who is a prominent journalist seeks to amend its pleadings to include, inter alia , misappropriation of personality and breach of duties of confidentiality and fiduciary trust. Position of the Plaintiff [ 2 ] The Plaintiff contends that the general rule regarding amendment of pleadings has been discussed by this court in Kent v. Martin [1] and more prominently in the case of Balm v. 3512061 Canada Ltd. [2] .

In Balm , the Plaintiff points out the reference of the Court of Appeal that “the court must allow an amendment even though it raises a doubtful plea, if it is arguable.” [3] .

[ 3 ] The Plaintiff also argues that their alleged tort, the tort of misappropriation of personality, applies here, and is evolving. On the last point see, e.g., Hay v. Platinum Equities [4] , a decision of our court where Justice Brooker said this at paras. 72-73: 72 In Rothschild , the judge was dealing with an interlocutory motion for an injunction. At para. 5 he says simply: Further there has been appropriation of personality. One cannot commercially exploit another's name or likeness without his permission .

In my view the tort of appropriation of personality has been committed and must be enjoined. [emphasis added] 73 Applying these principles to the case at hand, I find that despite the lack of "celebrity"of the plaintiffs, the tort of appropriation of personality has been made out.

A professional's name and reputation is entitled to be protected from unauthorized commercial exploitation every bit as much as a celebrity's name and likeness.... [ 4 ] As it relates to the Plaintiff’s allegations, in the context of the internet, the Plaintiff is arguing that the Defendants are misappropriating the Plaintiff’s image, his famous nickname, and descriptions of his career. Position of the Defendants [ 5 ] The Defendants also point me to Kent v.

Martin ( supra ) and Balm ( supra ) agree that courts generally should allow pleadings to be amended at any time, subject however to the following exceptions: 1) The amendment causes the opposing party serious prejudice not compensable by the award of costs; 2) The amendment is hopeless; 3) Unless permitted by statute, it adds a new cause of action or adds a new party outside the statutory limitation period; or 4) The failure to amend earlier is indicative of bad faith. [5] [ 6 ] During oral arguments, the Defendants withdrew their objection to amended paras. 22(

f) and 22(l). (Para. 22(

f) deals with breach of duties by Kent’s former campaign legal counsel and para. 22(

l) deals with a rebuttal by Kent that was never published by the Defendants.) The Defendants’ objection to amended para. 14, however, did not go away; it became the subject of further written submissions and continuing arguments. (Para. 14 if amended ties the involvement of two corporate officers - Godfrey and Fisher - to the impugned actions of the company.) [ 7 ] In defending this amendment, the Plaintiff in further written submission said, essentially, there is ample evidence Godfrey and Fisher were either involved or knowingly blind to (or had control over) the defamatory actions of the relevant news articles.

Mr. Watson, for the defendants, argued defamation requires a deliberate act [6] and quoted U.S. and Canadian authorities partially skipped by Mr. Bates for the Plaintiff [7] . Mr. Watson also reiterated his position that there is no evidence that Godfrey and Fisher have involvement in (or authority over) the websites and the Plaintiffs failed to provide evidence to support their amendments. [ 8 ] For the tort of misappropriation of personality, the main position of the Defendants is found in the almost 40-year old Ontario Court of Appeal decision in Krouse v. Chrysler Canada Ltd. [8] .

The Defendants argue that as in Krouse , there is no evidence suggesting the Plaintiff endorsed or is associated with the Defendants or their product, or any services advertised on the National Post website [9] .

[ 9 ] Furthermore, quoting Krouse , they refer to the danger noted by Estey, J. A. at p. 240 in D.R.: The danger of extending the law of torts to cover every such exposure in public not expressly authorized is obvious. Progress in the law is not served by the recognition of a right which, while helpful to some persons or classes of persons, turns out to be unreasonable disruption to the community at large and to the conduct of its commerce.

Much of this publicity will in reality be a mixed blessing involving the promotion of the game itself, but at the same time resulting in some minor or theoretical invasion of a player's individual potential for gainful exploitation. ... [ 10 ] Finally, as it relates to other proposed amendments, the Defendants essentially argue that there is no supporting evidence to allow such amendments.

Analysis [ 11 ] The general Rules of Court dealing with amending pleadings are found at 3.62, which states: 3.62( 1) A party may amend the party's pleading, including an amendment to add, remove, substitute or correct the name of a party, as follows: (

a) before pleadings close, any number of times without the Court's permission: (

b) after pleadings close, (

i) for the addition, removal, substitution or correction of the name of a party, with the Court's prior permission in accordance with rule 3.74 [ Adding, removing or substituting parties after close of pleadings] , or (ii) for any other amendment, with the Court's prior permission in accordance with rule 3.65 [Permission of Court to amendment before or after close of pleadings]. (

c) despite clauses (

a) and (b), whether or not pleadings have closed, with the agreement of the parties filed with the Court,

(2) An amended pleading must be (

a) filed, and (

b) served on each of the other parties (

i) within 10 days after the date on which it is filed, or

(ii) if the pleading is a statement of claim that has not already been served, in accordance with Division 3, Subdivision 2 [Time Limit for Service of Statement of Claim] . ... [ 12 ] This rule, which is new, has been interpreted several times since November, 2010. The Plaintiff and Defendants both point to Kent v. Martin , supra , but there are other decisions [10] . [ 13 ] Most of the argument focussed on Mr. Godfrey and Mr. Fisher. On that point, proposed para. 14 amendment states this: On two occasions, on or about August 18, 2010 and October 12, 2010, Kent caused to be delivered to Postmedia, Godfrey and Fisher notices setting out the defamatory nature of the

Article and requesting that the

Article be removed from the National Post website. None of Postmedia, Godfrey or Fisher has ever replied to Kent’s request that the

Article be removed and in fact through the knowing acts or omissions of Postmedia, Godfrey and Fisher the

Article remains in continuous worldwide publication on numerous additional websites owned by Postmedia and over which Godfrey and Fisher have authority including but not limited to: ... (numerous websites listed) [ 14 ] As it is written, rule 3.62 places the matter in the judge’s hand and the evolving case law suggests a continued tilt in favour of a liberal amendment of pleadings. As long as there is some foundation and unless there is a significant prejudice or an injustice, the order to allow amendments should be freely given [11] .

I am not saying that every amendment should be automatically allowed, because factors such as bad faith, unreasonable delay, or questionable motive are always in play and may prove fatal to the Amendment request. But none of those factors are being argued by the Defendants in this case. [ 15 ] The substantial allegations as set out above are that Godfrey and Fisher have control over the actions of the Defendant Postmedia. For his part, Paul Godfrey is the President and chief executive officer of the National Post. Gordon Fisher is the executive vice-president of western Canada for Postmedia Network Inc.

He is also President of the National Post. [ 16 ] The liability of corporate officers for defamation is discussed in The Law of Defamation in Canada [12] : A stockholder or corporate officer, merely by virtue of their office, cannot be held personally liable for a corporate wrong. There must be some showing that they were personally connected with the publication because they aided or assisted in the publication or circulation of the defamatory material.

Where the defendant corporation is a newspaper, a publisher and editor will be liable only if he or she aided, assisted and advised in the publication or circulation of the defamation, or their duties charged them with the performance of functions concerning the publication and circulation of the newspaper. [ 17 ] Amendments cannot be hollow [13] , futile [14] , or hopeless [15] . I don’t think these amendments are. The Defendants argue that the evidence may be hard to find, or should be set out better and with more substance.

While I won’t get into evidence, I think the allegations are at least worthy of argument, and I am not prepared to take the risk that I would allow an incomplete trial to go ahead if I disallowed them. [ 18 ] Put another way, I would far rather err in sending a matter to the trial on its merits, than take it away on the pleadings. [ 19 ] While the evidence could be stronger, pleadings are not evidence and in this case there is at least a “modest degree of evidence” [16] .

On top of that, as it relates to Godfrey and Fisher, their positions of corporate responsibility suggest under any analysis that they manage or are responsible for the affairs or their corporations. I am not prepared, on a motion to amend the Statement of Claim and on the limited evidence available before me on this application, to conclude that their personal responsibilities are such that they could

not be held to have aided or assisted in the publication of the allegedly defamatory article. Conclusion [20] For the above reasons, the application to amend is allowed. Pursuant to rule 3.65, the amended pleading must be filed and served on or before September 28th, 2012. Heard on the 4th day of August, 2012. Dated at the City of Calgary, Alberta this 14th day of September, 2012. W.A. Tilleman J.C.Q.B.A. Appearances: Michael Bates Ruttan Bates for the Plaintiff G.

Scott Watson Brent Mescall Parlee McLaws LLP for the Defendants Postmedia Network Inc., National Post Inc., Paul Godfrey and Gordon Fisher [1] 2011 ABQB 416, at para. 8. [2] 2003 ABCA 98. [3] Balm at para. 12. [4] 2012 ABQB 204. [5] P. 1 of the Defendants’ brief, citing Foda v. Capital Health Region, 2007 ABCA 207 at para. 10. [6] Crookes v. Newton, 2011 SCC 47, paras. 85, 93. [7] Id., paras. 86-92. [8] (ON CA), 1 O.R. (2d) 225, Ontario Court of Appeal [1974], 40 D.L.R. (3d) 15, 13 C.P.R. (2d) 28.

[9] Written brief of the Defendants, p. 3. [10] See also Hunka v. Degner , 2012 ABQB 207 . [11] Regarding the injustice, see Balm at para. 14 , citing Derby and Company v. Weldon (No.5), [1989] 1 W.L.R. 1244 ; [1989] 3 All E.R. 118 , (1989) 133 S.J. 1446. [12] Raymond E. Brown, The Law of Defamation in Canada , loose-leaf (consulted on 10 September 2012), (Toronto: Thomson Reuters Canada Limited, 1994), ch 18 at 138. [13] Courts have used many terms to describe inadequate amendments to pleadings, including “ obviously invalid ” ( Renfrew Insurance Ltd. v.

Donald , 2012 ABQB 228 , at para 52 ), “ meaningless ” ( Laird v. Scott , 9 W.L.R. 349, (Sask. S.C.) , at para. 8 ), “ frivolous ” ( Gray v. Balkwill , 5 W.L.R. 257, (North West Provinces Chambers) at para. 6), and “ nullities ” ( Foda v. Capital Health Region , supra note 5, at para. 1 ). [14] By futile I mean it would make little sense to grant an amendment that is barren of all evidence and is otherwise so starved of a triable issue that it faces a perfect (100%) chance of success on a motion to strike or a motion for subject of

summary judgment. [15] See e.g. decision of Wittmann, C.J.Q.B. in Dow Chemical Canada Inc. v. Nova Chemicals Corporation , 2010 ABQB 524 , paras. 21- 37 . [16] 869120 Alberta Ltd. v. B & G Energy Ltd. , 2011 ABQB 209 , para. 24 .