ASHLEY LYNN BLOM, APPLICANT (DEFENDANT) - v. -, 2023 SKKB 43

KING’S BENCH FOR SASKATCHEWAN Citation: 2023 SKKB 43 Date: 2023 02 22 Docket.: QBG-RG-02739-2021 Judicial Centre: Regina BETWEEN: ASHLEY LYNN BLOM, APPLICANT (DEFENDANT) - and - JOSEPH SHANE WOLLNER-KALLIS, RESPONDENT (PLAINTIFF) AND: Docket.: QBG-RG-02740-2021 Judicial Centre: Regina BETWEEN: ASHLEY LYNN BLOM, APPLICANT (DEFENDANT) - and - JOCO INVESTMENT CORP., RESPONDENT (PLAINTIFF) Counsel: Leonard D. Andrychuk, K.C. for Ashley Blom

E.F. Anthony Merchant, K.C. for Joseph Wollner-Kallis and JoCo Investment Corp. ___________________________________________________________________________ JUDGMENT POPESCUL C.J.K.B. February 22, 2023 ___________________________________________________________________________ I. INTRODUCTION [ 1 ] Joseph Shane Wollner-Kallis [Mr. Wollner-Kallis] is the chief executive officer and president of the JoCo Investment Corp. [JoCo Investment] [together the respondents]. Mr. Wollner-Kallis and Ashley Lynn Blom [Ms. Blom] entered into a personal romantic relationship in February 2018.

On December 11, 2021, after their relationship collapsed, Mr. Wollner-Kallis went to Ms. Blom’s condominium. Ms. Blom called the police and complained that Mr. Wollner-Kallis had no right to be there. On December 15, 2021, Mr. Wollner-Kallis was charged with breaking and entering the premises of Ms. Blom, contrary to s. 348(1) (

b) of the Criminal Code , RSC 1985, c C-46 [criminal charge]. [ 2 ] On December 17, 2021, Mr. Wollner-Kallis caused to have issued two statements of claim wherein damages are sought against Ms. Blom. QBG-RG-02739-2021 [Defamation Action] seeks damages from Ms. Blom for allegedly making slanderous and defamatory statements against Mr. Wollner-Kallis. QBG-RG-02740-2021 [Builders’ Lien Action] alleges that Ms. Blom owes JoCo Investment the sum of $166,500 for upgrades to her condominium. A builders’ lien in the amount of $166,500 was registered against Ms. Blom’s condominium the day before the filing of the action.

On December 20, 2021, Ms. Blom was served with both statements of claim. [ 3 ] Ms. Blom has now brought two applications, one for each action, wherein she seeks to strike each claim. [ 4 ] With respect to the Builders’ Lien Action, Ms. Blom seeks an order vacating the claim of lien and any related encumbrances and also requests that the claim be struck, pursuant to s. 60 of The Builders’ Lien Act , SS 1984-85-86, c B-7.1 , on the basis that it “is an obvious spurious claim”.

In the alternative, she requests that the claim be stuck on the basis that pursuant to Rules 7-9(1) and 7-9(2) of The Queen’s Bench Rules , the claim is scandalous, frivolous, or vexatious, and is otherwise an abuse of the process of the court. [ 5 ] Insofar as the Defamation Action is concerned, Ms. Blom seeks to have that action struck, as well, because it is scandalous, frivolous, or vexatious, and is otherwise an abuse of process of the court. [ 6 ] In addition, with respect to both actions, Ms.

Blom seeks orders awarding solicitor-and-client costs pursuant to Rules 11-1 and 11-20 of The Queen’s Bench Rules against Mr. Wollner-Kallis, JoCo Investment and their solicitor on the basis that it was plain and obvious that both claims were without factual foundation, were motivated by malice and were brought for the purpose of embarrassing and intimidating Ms. Blom. [ 7 ] Part of the applications rests on a telephone conversation between Mr. Wollner-Kallis and Ms. Blom that was recorded by Ms. Blom, unbeknownst to Mr. Wollner-Kallis.

The respondents object to this evidence being relied upon on the basis that the full recording is not available, that it was illegally recorded and that it is privileged because it occurred within a “without prejudice” settlement discussion. The respondents have also brought a formal application to strike other portions of Ms. Blom’s affidavits. II. THE APPLICATIONS TO STRIKE PARAGRAPHS FROM MS. BLOM’S AFFIDAVIT S [ 8 ] In support of Ms. Blom’s applications to strike the claims of the respondents, she filed an affidavit in each action.

The affidavits contain a partial transcript of the audio recorded conversation that she and Mr. Wollner-Kallis had on January 2, 2022. The evidence before the Court suggests that the conversation occurred at 9:00 p.m. on that date and lasted 121 minutes. However, not all the conversation was recorded. Also, Ms. Blom chose to attach to her affidavit only those portions of the conversation that she thought were relevant to the issues before the Court. [ 9 ] Prior to the original return date for Ms.

Blom’s applications, counsel for the respondents filed a formal application objecting to certain paragraphs contained within Ms. Blom’s supporting affidavits, including the transcribed portions of the conversation. Counsel for the respondents argued that some of the paragraphs should be struck because they were inadmissible due to them being “irrelevant, false, or scandalous”.

Further, it was argued that the appended transcript should be struck because it was only an extract from the full audio recording and that, in any event, the entire conversation is privileged and, thus, inadmissible. [ 10 ] At the time of the first appearance, and after some discussion, it was decided that counsel for Ms. Blom would provide all of the audio recording that she had to counsel for Mr. Wollner-Kallis and JoCo Investment so that it could be listened to and transcribed.

This was ultimately done and the transcript of all those portions of the conversation that were recorded have now been filed as an exhibit to Mr. Wollner-Kallis’s affidavits. Although filed by the respondents for the purpose of putting the full transcript of the audio recording before the Court, the respondents nonetheless maintain their objection to the introduction of that transcript due to it being incomplete and privileged.

[ 11 ] In order to ensure that the record is clear with respect to the evidence that is admitted and that which is not, it is necessary for the Court to identify and address each of the concerns respecting the admissibility of the impugned portions of Ms. Blom’s affidavit.

This is in keeping with the approach outlined by the Court of Appeal in Thomas v Input Capital Corp. , 2020 SKCA 67 , 12 PPSAC (4th) 339, and Wongstedt v Wongstedt , 2017 SKCA 100 , 3 RFL (8th) 43, where at para. 38 it was acknowledged that it would be appropriate for the judge to “briefly articulate which portions of a contested affidavit are not in conformance with The Queen’s Bench Rules and what has been struck from the record”. [ 12 ] Counsel for the respondents objects to paragraphs 2, 3, 4, 5, 6, 7, 8, 9, 10 and 11 and Exhibits “A”, “B”, “C”, “D”, “E” and “F” of Ms.

Blom’s affidavit filed in the Defamation Action, and paragraphs 3, 4, 5, 7, 8, 10 and 11 and Exhibits “C”, “D”, “F” and “G” of Ms. Blom’s affidavit filed in the Builders’ Lien Action. [ 13 ] There are essentially three broad complaints made by the respondents respecting the impugned paragraphs in Ms. Blom’s affidavits. First, they contend that the identified paragraphs and related exhibits are irrelevant and offend Rule 13-33 of The Queen’s Bench Rules , which permits a court to order that “... any matter that is scandalous to be struck out from any affidavit”.

Second, they contend that the January 2, 2022 transcript should be struck because it is unreliable due to its incompleteness, was illegally obtained pursuant to the Criminal Code and was subject to settlement privilege. Third, they contend that some portions of Ms. Blom’s affidavit are irrelevant to the issue before the Court. [ 14 ] It is a fair comment that affidavits filed in support of applications, in addition to complying with technical rules, must also be relevant.

In Cowessess First Nations No. 73 v Phillips Legal Professional Corp. , 2018 SKQB 156 , Barrington-Foote J. (as he then was), noted, at para. 17, that, “... Parties and counsel are obliged to comply with Rule 13-30, just as they are obliged to lead only admissible, relevant and material evidence at trial. ...”.

A) Defamation Action [ 15 ] The impugned paragraphs and my ruling on each follows. i) 2. I became the registered owner of the Property on November 2, 2012 and continue to be the registered owner of the Property. A copy of the title to the Property is marked and attached hereto as Exhibit “A” [ 16 ] Mr. Wollner-Kallis argues that this paragraph is irrelevant to the Defamation Action because this averment relates to the Builders’ Lien Action and the two actions are unrelated. This argument is without merit. Ms. Blom’s applications to strike both claims are grounded, in part, on abuse of process.

It is very clear that the existence of the Builders’ Lien Action is relevant background to the scandalous, frivolous, vexatious or abuse of process analysis. (The term “abuse of process” is often used interchangeably with “frivolous” or “vexatious”: see Paulsen v Saskatchewan (Ministry of Environment) , 2013 SKQB 119 at para 48 , 418 Sask R 96 [ Paulsen ]).

In Bear v Merck Frosst Canada & Co. , 2011 SKCA 152 , 345 DLR (4th) 152 [ Bear ], Richards J.A. (as he then was) outlined the considerations relevant to an abuse of process allegations, as follows: 41 There is often no individual marker indicating whether a proceeding is an abuse of process. Rather, it is typically necessary to consider all of the relevant context and background in assessing whether an abuse of process has been established. ... [ 17 ] There is nothing wrong with this paragraph in Ms. Blom’s affidavit. Mr. Wollner-Kallis’s application to strike it is without merit and is dismissed. ii) 3.

In or around February 2018, I entered into a personal romantic relationship with Mr. Joseph Shane Wollner-Kallis … Mr. Wollner-Kallis was and continues to be the CEO and President of the Respondent, JoCo Investment Corp. ... . [ 18 ] The first part of this paragraph is clearly relevant to the Defamation Action. It puts the claim in context. As far as the second part, I find that it is proper for the same reasons outlined in the previous paragraph. I decline to strike this paragraph. iii) 4.

In or around December 2021, I ended our personal romantic relationship. [ 19 ] This statement is clearly relevant and does not offend any Rule nor any evidentiary rule. iv) 5. On December 11, 2021, my condominium apartment, the Property, was broken into. v) 6. On December 15, 2021, Mr. Wollner-Kallis turned himself into police custody and was charged with the break and entry into the Property … A copy of Information No. 991182662, with Mr. Wollner-Kallis’s Criminal Charges, is marked and attached hereto as Exhibit “B”. vi) 7. On December 16, 2021, Mr.

Wollner-Kallis was released from police custody on conditions that included, inter alia, that he not contact me. A copy of Mr. Wollner-Kallis’s Release Order is marked and attached hereto as Exhibit “C”. [ 20 ] I will deal with paragraphs 5, 6 and 7 together. Mr. Wollner-Kallis contends that the comments made in relation to the alleged break and enter into Ms. Blom’s condominium are irrelevant and scandalous. He claims that these paragraphs are scandalous because the phraseology used by Ms. Blom in her affidavit amounts to “pure rhetoric or word-play”. To suggest that Mr.

Wollner-Kallis “turned himself into police custody”, he argues, is akin to suggesting that he admitted guilt. In Mr. Wollner-Kallis’s affidavit he clarifies that when he found out that the police were going to proceed with a charge, he and his lawyer arranged for him to attend at the police station on a voluntary basis to be arrested and then quickly released. Further, because the charges against Mr.

Wollner-Kallis were subsequently withdrawn or stayed by the Crown, he continues to be “deemed innocent” and, thus, it is scandalous to refer to the incident because it leaves a false impression. [ 21 ] I find that paragraphs 5, 6 and 7 are relevant and not scandalous. They are relevant because, as mentioned above, they relate to matters that pertain to the scandalous, frivolous, vexatious or abuse of process analysis. Further, they are not scandalous, in

the Rule 13-33 sense, because, even though the charges were eventually withdrawn or stayed by the Crown, they still provide context. The fact that the actions were commenced two days after Mr. Wollner-Kallis was charged and arrested, even though the Crown subsequently decided not to proceed with the charges, is a relevant consideration. [ 22 ] Accordingly, I decline to strike paragraphs 5, 6 and 7. They provide evidence that is properly before the Court. vii) 8.

On December 16, 2021, Joco Investment caused a builders’ lien bearing No. 124883769 to be registered on the title to the Property pursuant to the Act in the amount of $166,500 ... . A copy of Interest Registration Notice is marked and attached hereto as Exhibit “D”. viii) 9. On or about December 17, 2021, the Claim was issued. Simultaneously, on the same date, JoCo Investments [ sic ] filed an action, Q.B.G. No. 2740 of 2021, against me as a result of the Lien on the Property (collectively, the “Spurious Claims”). A copy of Q.B.G. No. 2740 of 2021 is marked and attached hereto as Exhibit “E”. ix) 10.

At no point did I, verbal or otherwise, enter into a contract with JoCo Investment for JoCo Investment to conduct renovation upgrades to the Property. Furthermore, at no point did JoCo Investment conduct renovation upgrades, as set out in the Claim or at all, at the Property. [ 23 ] Paragraphs 8, 9 and 10 are related. I will deal with those paragraphs together.

While it is true that the Builders’ Lien Action is distinct from the Defamation Action, the two are nonetheless related for the purpose of determining the scandalous, frivolous, vexatious or abuse of process application because it is pertinent background information that assists in the analysis. x) 11. On January 2, 2022, Mr. Wollner-Kallis verbally admitted to myself that the allegations underlying the Spurious Claims are false and were falsely pled in order to have a reason to be in contact with myself and so that Mr. Wollner-Kallis could find a way to resolve the Criminal Charges.

A true copy of a transcript of this recording is marked and attached hereto as Exhibit “F”. [ 24 ] Mr. Wollner-Kallis attached to one of his affidavits his cell phone itemization sheet. This provides details respecting the call that was partially recorded by Ms. Blom. The record shows that Mr. Wollner-Kallis (contrary to the terms of his release from custody) telephoned Ms. Blom on January 2, 2022, at 9:00 p.m. and they spoke for 121 minutes. Ms. Blom recorded some, but not all the conversation.

In support of her applications to strike the claims, she transcribed certain portions of the parts of the conversation that she recorded. This was done without Mr. Wollner-Kallis’s knowledge. Eventually, all of the recordings were turned over to Mr. Wollner-Kallis who then had them transcribed. Before the Court, now, is a 46-page transcript that sets forth all of the parts of the conversation that were transcribed. [ 25 ] Ms. Blom submits that during the conversation Mr. Wollner-Kallis admitted that the allegations underlying the two actions were falsely pled in order to have a reason to be in contact with Ms.

Blom and amount to an attempt to find a way to resolve the criminal charge. [ 26 ] Mr. Wollner-Kallis argues that the transcript is inadmissible for a variety of reasons, including that it was a privileged settlement discussion, constitutes an illegal interception of private communications and that it would be unfair to permit the transcript to be admitted because it does not contain the full 121-minute conversation. In order to support his position, Mr. Wollner- Kallis filed a supplemental affidavit that states: 4.

The very first thing we agreed to in the phone conversation, after saying hello, was that we agreed that the entire conversation was on a without prejudice basis for settlement purposes. I would not have spoken any further if this had not been agreed. 5. I did not know that Ms. Blom was recording our without prejudice discussion and I did not give permission to be recorded nor was I informed that she was surreptitiously recording our discussion. [ 27 ] The arguments presented by Mr.

Wollner-Kallis are not sustainable and thus I find that the transcript of the recording of the telephone conversation is relevant and admissible evidence respecting Ms. Blom’s applications to strike the claim. I will elaborate.

a) Illegal interception of private communications [ 28 ] Mr. Wollner-Kallis quotes from the Criminal Code and suggests that “It is trite that wiretapping, or recording a person without their consent, is not legal”. [ 29 ] This is an incorrect statement of the law, as it pertains to the circumstances of this case. Section 184(2) of the Criminal Code makes it clear that recording private conversations is legal as long as one of the parties involved in the call or conversation consents to the recording. Here, Ms. Blom was one of the persons involved in the conversation and therefore there is nothing illegal about what she did. This argument must fail.

b) Not the full conversation [ 30 ] Ideally, it would have been better if the full conversation was before the Court. That way, one could be absolutely certain that nothing was taken out of context. Notwithstanding that it would have been better to have been able to review the full conversation, in the circumstances of this case, I find that this shortcoming does not make the rest of the transcript of the conversation inadmissible. It goes to weight not admissibility.

I hasten to add that there is nothing in the transcript of the conversation before the Court that suggests that it was edited or manipulated to paint a false picture. There is no obvious editing or any attempt to obfuscate Mr. Wollner-Kallis’s words or intention. Although the conversation was already in progress when the recording commences and seems to continue after the recording concludes (with some gaps in the middle), the listener is able to get a good sense of the conversation between both participants.

Accordingly, the mere fact that the transcript of the recording does not cover the full conversation does not amount to a reason, in these circumstances, to declare the content of the conversation inadmissible.

c) The conversation is subject to settlement privilege [31] Mr. Wollner-Kallis swears in his supplementary affidavit that both he and Ms. Blom agreed at the outset of theconversation that the entire conversation was to be on a without prejudice basis for settlement purposes.

Since the first part of theconversation was not recorded there is no irrefutable source to confirm or dispute his assertion. [32] The concept of settlement privilege was explained by the Supreme Court of Canada in Union Carbide CanadaInc. v Bombardier Inc., 2014 SCC 35, [2014] 1 SCR 800: 31 Settlement privilege is a common law rule of evidence that protects communications exchanged by parties as they try to settle adispute. Sometimes called the “without prejudice” rule, it enables parties to participate in settlement negotiations without fear thatinformation they disclose will be used against them in litigation.

This promotes honest and frank discussions between the parties, whichcan make it easier to reach a settlement:: “In the absence of such protection, few parties would initiate settlement negotiations for fearthat any concession they would be prepared to offer could be used to their detriment if no settlement agreement was forthcoming” (A.W.Bryant, S.N. Lederman and M.K. Fuerst, The Law of Evidence in Canada (3rd ed. 2009), at para. 14.315). 32 Encouraging settlements has been recognized as a priority in our overcrowded justice system, and settlement privilege has beenadopted for that purpose.

As Abella J. wrote in Sable Offshore [2013 SCC 37], at para. 12, “[s]ettlement privilege promotes settlements.”She explained this as follows, at para. 13: Settlement negotiations have long been protected by the common law rule that “without prejudice” communications made in the courseof such negotiations are inadmissible (see David Vaver, “‘Without Prejudice’ Communications -- Their Admissibility and Effect”(1974), 9 U.B.C. L. Rev. 85, at p. 88).

The settlement privilege created by the “without prejudice” rule was based on the understandingthat parties will be more likely to settle if they have confidence from the outset that their negotiations will not be disclosed. As OliverL.J. of the English Court of Appeal explained in Cutts v.

Head, [1984] 1 All E.R. 597, at p. 605: ... parties should be encouraged so far as possible to settle their disputes without resort to litigation and should not be discouraged by theknowledge that anything that is said in the course of such negotiations ... may be used to their prejudice in the course of the proceedings.They should, as it was expressed by Clauson J in Scott Paper Co v. Drayton Paper Works Ltd (1927) 44 RPC 151 at 157, be encouragedfreely and frankly to put their cards on the table.

What is said during negotiations, in other words, will be more open, and therefore more fruitful, if the parties know that it cannot besubsequently disclosed. [33] The three requirements for the existence of settlement privilege, as set forth in Alan W. Bryant, Sidney N.Lederman and Michelle K. Fuerst, The Law of Evidence in Canada, 4th ed (Markham ON: LexisNexis, 2014) at para 14.325, are: (

a) there is a litigious dispute; (

b) the communication has been made with the express or implied intention it would not be disclosed in a legal proceeding in the eventnegotiations failed; and (

c) the purpose of the communication is to attempt to effect a settlement. The above statement has been cited with approval in a number of cases including, Hollinger Inc. (Re), 2011 ONCA 579 at para 16, 107OR (3d) 1, and Manderscheid v Humboldt Smiles Dental Studios Inc., 2021 SKCA 42 at para 14. [34] Applying these principles to the facts before me, I find that the portions of the conversation impugned by therespondents are not protected by settlement privilege. Although a litigious dispute was in existence, the discussion containing the criticalpassages that Ms.

Blom seeks to have the Court consider was not made with the express or implied intention that it would not bedisclosed in a legal proceeding in the event negotiations failed and was not made for the purpose of attempting to effect a settlement. Themere fact that Mr. Wollner-Kallis may have started out the conversation by saying that it was “without prejudice” if, indeed, that is thecase, does not necessarily make it so, or vice versa.

A close review of the transcript of the conversation does not drive the conclusion thatthe parties were “negotiating” a settlement; rather they were talking about their failed relationship, the circumstances that led to thecriminal charge and the validity of the two actions launched by Mr. Wollner-Kallis on his own behalf and on behalf of his company.There is no sense of a negotiation in the traditional sense, or for that matter, in any sense. [35] In addition, the portions of the conversation sought to be relied upon by Ms.

Blom were clearly not part of thesettlement discussions, if indeed there were settlement discussions that were not recorded. [36] Furthermore, if the conversation could be stretched to suggest that it was a settlement discussion that involved acomponent to have the charge dropped in exchange for having the civil actions go away, such a conversation would not be covered bysettlement privilege because it would not amount to a “bona fide” negotiation.

In Prior v Sunnybrook and Women’s College HealthSciences Centre, (Ont Sup Ct), the alleged privileged settlement discussion included an offer to attempt to withdrawa complaint with a disciplinary body in exchange for a release. At para. 5, the following comments are found: 5. ... The court would not countenance a threat to pursue a criminal or quasi-criminal proceeding to obtain an advantage in a civilproceeding. A discipline process that could affect the livelihood of the other party is in the same category. I see no difference in qualitybetween a threat to prosecute or an agreement to withdraw a complaint.

Either of these may be indicia of bad faith and neither shouldattract the protection afforded to bona fide settlement discussions. [37] Finally, in the event that settlement privilege does apply, which I have found that it does not, I would find thatthis would be one of those cases where justice requires an exception to be made. In Sable Offshore Energy Inc. v Ameron InternationalCorp., 2013 SCC 37, [2013] 2 SCR 623, Justice Abella noted the availability of exceptions to settlement privilege:

12 Settlement privilege promotes settlements. As the weight of the jurisprudence confirms, it is a class privilege. As with other classprivileges, while there is a prima facie presumption of inadmissibility, exceptions will be found “when the justice of the case requires it”(Rush & Tompkins Ltd. v. Greater London Council, [1988] 3 All E.R. 737 (H.L.), at p. 740). ... 19 There are, inevitably, exceptions to the privilege. To come within those exceptions, a defendant must show that, on balance, “acompeting public interest outweighs the public interest in encouraging settlement” (Dos Santos Estate v.

Sun Life Assurance Co. ofCanada, 2005 BCCA 4, 207 B.C.A.C. 54, at para. 20). These countervailing interests have been found to include allegations ofmisrepresentation, fraud or undue influence (Unilever plc v. Procter & Gamble Co., [2001] 1 All E.R. 783 (C.A. Civ. Div.), Underwoodv. Cox (1912), (ON SCDC), 26 O.L.R. 303 (Div.

Ct.)), and preventing a plaintiff from being overcompensated (DosSantos). [Emphasis added] It is untenable to permit a civil action to be used for the purpose of discouraging a person from pursuing or maintaining a legitimatecriminal complaint. [38] Accordingly, I decline to strike the transcript of the conversation for any of the reasons set forth by Mr.Wollner-Kallis.

B) The Builders’ Lien Action [39] The impugned paragraphs and my ruling on each are as follows: i) 3. In or around February 2018, I entered into a personal romantic relationship with Mr. Joseph Shane Wollner-Kallis … Mr.Wollner-Kallis was and continues to be the CEO and President of the Respondent, JoCo Investment Corp ... . ii) 4. In or around December 2021, I ended our personal romantic relationship. iii) 5. On December 11, 2021, my condominium apartment, the Property, was broken into. iv) 7. On December 15, 2021, Mr.

Wollner-Kallis turned himself into police custody and was charged with the break and entry into theProperty ... A copy of Information No. 991182662, with Mr. Wollner-Kallis’s Criminal Charges, is marked and attached hereto asExhibit “C”. v) 8. On December 16, 2021, Mr. Wollner-Kallis was released from police custody on conditions that included, inter alia, that he notcontact me. A copy of Mr. Wollner-Kallis’s Release Order is marked and attached hereto as Exhibit “D”. vi) 10. On or about December 17, 2021, the Claim was issued. Simultaneously, on the same date, Mr.

Wollner-Kallis filed an action,Q.B.G No. 2739 of 2021, against myself for defamation, statutory slander, and negligence, and seeking punitive damages and aninjunction against myself (collectively the “Spurious Claims”). A copy of Q.B.G. No. 2739 of 2021 is marked and attached hereto asExhibit “F”. vii) 11. On January 2, 2022, Mr. Wollner-Kallis verbally admitted to me in a telephone call that the allegations underlying the SpuriousClaims are false and were falsely pled in order to have a reason to be in contact with me and so that Mr. Wollner-Kallis could find away to resolve the Criminal Charges.

A true copy of the transcript of this recording is marked and attached hereto as Exhibit “G”. [40] The impugned paragraphs mirror the paragraphs scrutinized in relation to the Defamation Action. Myconclusions and reasons for finding that the paragraphs are proper and should not be struck are the same as those mentioned in theportion of this decision relating to the Defamation Action. [41] I decline to strike the above identified paragraphs as requested by counsel for JoCo Investment. III. BACKGROUND FACTS [42] Ms. Blom purchased her condominium on November 2, 2012.

The Land Titles Registry title indicates the valueof the property, at the time, to be $270,249. It was secured by a mortgage of $248,574.93. [43] In February of 2018, Ms. Blom and Mr. Wollner-Kallis became romantically involved. The relationship endedin December of 2021. While it does not matter much, both assert that it was them that terminated the relationship. Ms. Blom swears inher affidavit, “In or around December 2021, I ended our personal romantic relationship”. Mr.

Wollner-Kallis states in his affidavit, “Iended the relationship on December 11, 2021”. [44] The evidence before the Court indicates that on December 11, 2021, Mr. Wollner-Kallis attended at Ms. Blom’sresidence. He says that the purpose of his attendance was to pick up the key and gate opener for his residence that he had left at hercondominium. Ms. Blom asserts that Mr. Wollner-Kallis entered her premises without her permission. Ms. Blom called the police andcomplained about what had occurred. The police investigated and on December 15, 2021, Mr.

Wollner-Kallis was charged with onecount of breaking and entering into Ms. Blom’s residence, with intent to commit mischief, contrary to s. 348(1)(

b) of the Criminal Code.Mr. Wollner-Kallis retained the services of Lin Pham, a Regina lawyer, who is not associated with the law firm involved in the civilactions before this Court. Mr. Wollner-Kallis, with the assistance of his lawyer, turned himself into the police. Shortly thereafter he wastaken before a Provincial Court judge and released. The release order that he signed on the date of his release contained a number ofconditions, including that he, “… Have no contact of any kind in any way, directly or indirectly, with Ashley Blom except through a

lawyer”, and that he, “… Not refer to Ashley Blom in any way, directly or indirectly, while using electronic social media” and that he, “… Not be at the residence, workplace or place of education of Ashley Blom”. [ 45 ] It is not disputed that Mr. Wollner-Kallis intended to plead “not guilty” to the charge of break and enter and commit mischief and that on April 19, 2022, the morning that his preliminary inquiry was about to begin, the Crown entered a stay of proceedings on the charge. [ 46 ] Mr.

Wollner-Kallis deposes that he gave instructions to his counsel to commence the Builders’ Lien Action on December 11, 2021 (the evidence does not reveal if this was before or after he entered Ms. Blom’s residence) and the Defamation Action on December 12, 2021. Both claims were issued with unusual haste on December 17, 2021. Ms. Blom was served with both claims, before Christmas, on December 20, 2021. [ 47 ] The Defamation Action asserts that Ms. Blom, since July 2021, made several false “imputations” that have caused Mr. Wollner-Kallis financial loss and have lowered his reputation in the community.

Particulars of the alleged remarks made by Ms. Blom as listed in the claim include, “coke head”, “p*ss tank”, “womanizing” and “shifty shady business guy”. The basis for the claim includes common law defamation, statutory slander that falls within the ambit of The Libel and Slander Act , RSS 1978, c L-14 , and negligence.

The remedies sought include general damages (in an amount to be proven at trial), punitive and exemplary damages, a prohibitive injunction, a quia timet injunction (an injunction to restrain wrongful acts which are threatened or imminent but have not yet commenced), pre-judgment interest and costs. [ 48 ] The Builders’ Lien Action claims that Mr. Wollner-Kallis’s company, JoCo Investment, was retained, pursuant to a “verbal agreement” to conduct renovation upgrades to Ms. Blom’s condominium.

The claim further alleges that the upgrades have been completed, and that the amount of $166,500 is now due and payable to JoCo Investment, the entirety of which is outstanding. To secure this alleged debt, the claim asserts that JoCo Investment has the right to cause an interest to be registered on its claim by registering a lien on Ms. Blom’s property. An encumbrance was indeed registered against Ms. Blom’s condominium. JoCo Investment alleges in its claim, a variety of causes of action including breach of contract, repudiation and unjust enrichment.

The remedies sought include damages in the amount of $166,500.00, or damages on a quantum meruit basis or restitution of $166,500.00, damages for loss of economic opportunity in an unspecified amount, punitive and exemplary damages, pre-judgment interest and costs. [ 49 ] With respect to the Defamation Action, Ms. Blom has stated emphatically in her sworn affidavit, filed in support of her application to strike the claim, that: 12. I deny that I have defamed or slandered Mr. Wollner-Kallis, or acted negligently towards Mr.

Wollner-Kallis by making any untrue or false statements regarding him, as alleged or at all, verbal or otherwise, since July 2021. 13. I understand that it has been alleged that I have made various improper and malicious remarks to Mr. Wollner-Kallis to my friends, members of our mutual social circle, and members of Mr. Wollner-Kallis’s social and business circle. I deny that any such improper and malicious remarks were made, but in any case have no knowledge of which individuals these remarks were allegedly made to or when the remarks were allegedly made. [ 50 ] With respect to the Builders’ Lien Action, Ms.

Blom has sworn, in no uncertain terms, that there were no renovations or upgrades to her condominium made by JoCo Investment. Her affidavit in support of her application to strike the Builders’ Lien Claim and discharge the interest registered against her property, includes the following paragraphs: 19. At no point did I, verbally or otherwise, enter into a contract with JoCo Investment for JoCo Investment to conduct renovation upgrades to the Property. Furthermore, at no point did JoCo Investment conduct renovation upgrades, as set out in the Claim or at all, at the Property. 20.

I have never received any invoice or bill of materials from JoCo Investment in relation to the alleged $166,500.00 worth of work, or at all. [ 51 ] In support of these definitive statements, Ms. Blom offers other proof and photographs that confirm that there have not been any significant renovations or upgrades to her condominium since she bought it. The only upgrade completed since she owned the property was the application of some vinyl wallpaper to her master bedroom. The work was done by her uncle. Her uncle also swore an affidavit that corroborates these statements. He was with Ms.

Blom when she first viewed the condominium in 2012, before she purchased it, and has visited the condominium frequently. He makes the following clear statement in his affidavit: 3. I have not observed nor am I aware of any renovations or upgrades to the Property in the entire time it has been owned by Ms. Blom, except for the renovation I completed in August of 2019, which was the application of vinyl wallpaper on one of the walls of the master bedroom. It is my belief that this renovation I completed is the only renovation or upgrade that has been done to the Property while owned by Ms.

Blom. [ 52 ] Some portions of the January 2, 2022 conversation that were recorded and which I have found to be admissible, are useful for context. A review of the entire transcript reveals a somewhat tense conversation between two former partners who, at times, discussed the criminal charge and the two lawsuits. The following excerpts provide a flavour of the conversation and suggests that the “lawsuits” were commenced for ulterior motives: Ms. Blom: But it’s about me that you’re lying.

Like, you’re lying that I never paid you for renovations; you’re lying that I said those kind of things about you when I don’t even talk like that ; and you lied, like, just the other day, you were, like, oh, it was a loan. I’m like, it wasn’t a loan. They were gifts throughout the years, and you’re like, well, I know. Like, you changed your tune, but still, like, you’re still kind of, like, playing games, and I just -- I didn’t like that. I’m just, like, really? Like -- Mr.

Wollner-Kallis: I know, Hun, but like I told you that stuff was I was feeling, like, I don’t like where this is -- feel bad and a little bit used, and whatnot, so that’s what that was, but at the end of the day, Ash, the other stuff, all the lies, whatever, is in order to -- in order to

be able to have those lawsuits. You have to have something, okay ? They hurt you, and the only reason that I wanted to have those ‘cause I didn’t want to have them -- didn’t want to have any of this, but me resolving this -- I can’t learn how this charge can be having somebody that I love and feeling like this is what you want for me, and you want to continue to crash this the feeling that I have, right, and the message in that is sort of [indiscernible].

And so, that’s the only reason those even exist was just to kind of make sure what some way, somehow we can get together and deal with this charge and not be there to do things to each other . Ms. Blom: You could have just apologized and asked to work it out. You didn’t have to take this route of -- like, you didn’t have to do that. Do you really think I would be like no, screw you, I want, like -- no. ... Ms. Blom: -- that made it so much worse. Like, you know, it wasn’t only the made-up lawsuits , it was on top of it, like, the mean text messages, getting, you know, some girl to call me that was a lie.

Like, it was like you’re just trying to -- I don’t know, like, that was just even extra that was so unnecessary. Mr. Wollner-Kallis: No, I know. I’m with you. I don’t disagree . I know. ... Ms. Blom: I just -- I don’t know, and I think the reason too what made me not want to talk to you in the beginning even more is because I was just hearing that you kept making it seem like there was no reason why I should call the police, but, I was like, maybe he doesn’t fully remember ‘cause if he did, I’d find it pretty hard to believe that he wouldn’t understand why, and just as though it was ...

I should be crucified because I called the police when I was scared and didn’t know what was going on when you were, like, sending me all those messages, whether it was through other people’s phones, by email, like, I don’t know, it was just a lot, and then it was just like -- and then, you know, it was the threat of what was to come, and your life -- I’m going to make your life miserable, and just hearing comments that you had said, like, oh, when I’m done with her, all she’s going to own is her car or Honda Civic. I’m just like, wow.

So, it was like everything that was being said, and then the actions that you took. Like I said, it didn’t only stop at these like fabricated lawsuits , it was everything else that you did to follow that were -- that were just like unnecessary. I don’t understand. Like, okay, you explained to me that you need these lawsuits ‘cause you want me to help get the charge dropped , but if that’s the case, like, what was -- I just -- I don’t understand, like, all these other hurtful little things that you did that were just over and above what was already going on. Mr.

Wollner-Kallis: Yes, and I’m sorry for everything that I’ve done to hurt you whether it’s been recent or, you know, our history together . ... Ms. Blom: Well, I guess, first of all, creating fabricated lawsuits to serve me with also feels like it was something to make me scared. Mr. Wollner-Kallis: I told you that’s -- you know, it was not to make you feel scared. That was to make sure that I had something in my court that will help ensure that I can get some cooperation hopefully.

That’s all I wanted ‘cause I didn’t have the chambers or avenues to be able to talk to you and two grown adults -- again, all I felt was that you were really mad, upset, hurt, and I totally understood that. Ms. Blom: Well, you didn’t, at the time. Mr. Wollner-Kallis: Yes, I did, Ash, and then -- and you told your aunt over that weekend that, you know, Joey’s going to wake up from this and, you know, this is all his doing, and he’s going to feel bad. Ms. Blom: Well, yeah, ‘cause that’s what always happens when you drink. Mr. Wollner-Kallis: Yeah, you know what?

That’s right, but when I woke up, and [indiscernible] your texts, how do you feel, and I said, well, without seeing, I feel very -- hurting. I feel upset, I feel angry at myself, I feel angry at Ash. So, but what was -- Ms.

Blom: This is just -- and I know I told you this before, this is what I don’t get though, like, you say that these lawsuits were to kind of have leverage on me to make me like help you with the charge or whatever, but before you even started sending me those messages, you were telling me that you were going to -- you were going to -- you said, liens, liens, liens, or whatever, and I didn’t know at the time what you were talking about, but it’s like you were already trying to do something to me before even then. Mr. Wollner-Kallis: Yes, I know.

And again, it was not very [indiscernible], but obviously, was in a very bad mindset, condition, and I still hurt . I felt like -- you know, it felt like when I was at your house -- again, that whole two weeks building up to that. It really weighed on me, and then when I did come to your place, got my keys, the opener, I felt like the knife just went that much deeper when it was like, okay, here you go. I was like -- you were like, don’t care. ... Ms. Blom: Like, it’s like, oh, the next time I make Joey mad, is he going to fabricate lawsuits again, like, it’s just ridiculous. Mr. Wollner-Kallis: No, Ash.

And again, I’m trying to reflect on some of our conversations, and I’m trying to understand where you’re coming from and your position, and how you felt and for [indiscernible[, but you just need to know that none of this was just about being made, it was about the charge, and I just wanted to know or hopefully know that I would have some ways of how -- have your help. ... Ms. Blom: But you were making it worse. That’s the -- like, that’s the thing. Mr. Wollner-Kallis: Ash, I get that . I get that, but all I was trying to do was hope that when things are out a little further and I have to

deal with what I’m dealing. I’m hoping that, okay, whether you wanted help or not or that you hate me or not, hoping that this will get us together to make sure that both of us get out of all this shit . Ms. Blom: But, Joe, you’re saying both of us get out of it, but what you really mean is you get out of it ‘cause I -- Ms. Wollner-Kallis: I know. Exactly. Ms. Blom: So, don’t say both of us get out of it, say, me get out of it because the only thing I’m in it is things that are made up lies. Mr.

Wollner-Kallis: Yeah, so, that’s how it’s designed is that I’m hoping that with what we do that that will whether you want to or willingly want to or not or not want to and if you hate me or not, hoping that that will be able to get us together later on to work things out so that the charge goes away, and then, of course, everything else goes away . Is that how I want us to [indiscernible[ Ash, and want -- and for us to be? No. ... [Emphasis added] [ 53 ] Mr. Wollner-Kallis filed affidavits in opposition to Ms. Blom’s applications to strike. What the affidavits do not say, is more telling than what they do say.

His affidavits focus on the transcript and how, in Mr. Wollner-Kallis’s estimation, the conversation recorded was without prejudice and the transcript does not tell the complete story because it does not contain the entire conversation. The affidavits also go on to attempt to cast doubt on the meaning of the plain words spoken between the two participants. Mr. Wollner-Kallis goes to some length to explain that his counsel, E.F. Anthony Merchant, K.C., was not aware of the fact that he had been arrested and charged with the break and enter immediately prior to the two actions being commenced. According to Mr.

Wollner- Kallis, he “gave instructions regarding the work on the condominium to launch proceedings [on the Builders’ Lien Action] on December 11, 2021” and that he “instructed Merchant Law Group LLP to launch the libel and slander proceedings against Ms. Blom [Defamation Action] on December 12, 2021”. His affidavit is silent on specifically to whom, in particular, he provided the instructions to commence these claims, but states that he believes Mr. Merchant went to Mexico on December 10, 2021, “where he remained until after Christmas ...”. Mr. Wollner-Kallis, in this regard, offers the following information: 26.

I communicated with a number of people in Merchant Law providing them with details regarding my two claims and I am informed by Mr. Merchant and do verily believe that three lawyers, an articling student, and a number of senior paralegals all had something to do with the work regarding the claims. 30.

I have disclosed this solicitor/client protected information because of the unusual request for costs jointly and severally against me and Merchant Law Group LLP but I do not waive solicitor/client privilege and make this limited disclosure in the circumstances of the unusual request for costs against Merchant Law Group LLP. [ 54 ] What the affidavits do not address is the merits of the claims. The material is absolutely silent on the nature of the labour and materials allegedly expended on renovations or upgrades in Ms. Blom’s condominium.

No invoices, photographs, sworn statements from tradespersons, or anything in that vein, at all, were filed. Similarly, the affidavit material does not, in any significant way provide any detail or substantiation of the nature and extent of the allegedly defamatory or libelous statements or publications, other than the very vague comment that he instructed his lawyers to commence the claim, “As a result of receiving information regarding the slanderous and libelous statements that Ms. Blom was making about me which I feared would effect my reputation and my business interests”. IV.

THE LAW [ 55 ] Rule 7-9 of The Queen’s Bench Rules provides the basis for Ms. Blom’s applications. The relevant portion of the Rule reads as follows: Striking out a pleading or other document, etc. in certain circumstances 7-9(1) If the circumstances warrant and one or more conditions pursuant to subrule (2) apply, the Court may order one or more of the following : (

a) that all or any part of a pleading or other document be struck out ; (

b) that a pleading or other document be amended or set aside; (

c) that a judgment or an order be entered; (

d) that the proceeding be stayed or dismissed.

(2) The conditions for an order pursuant to subrule (1) are that the pleading or other document : (

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

b) is scandalous, frivolous or vexatious ; (

c) is immaterial, redundant or unnecessarily lengthy; (

d) may prejudice or delay the fair trial or hearing of the proceeding; or (

e) is otherwise an abuse of process of the Court .

(3) No evidence is admissible on an application pursuant to clause (2)(a).

[Emphasis added] [56] Ms. Blom also seeks to have the claim of lien and certificate of action vacated pursuant to s. 60 of The Builders’Lien Act.

Section 60 reads as follows: 60 The court may, on application: (

a) order that the registration of; (

i) a claim of lien; or (ii) a certificate of action; or both, be vacated; (

b) declare that a written notice of a lien no longer binds the person to whom it was given; or (

c) dismiss an action; on any terms and conditions that the court may order. [57] The grounds upon which Ms. Blom relies for the striking of the claims are Rules 7-9(2)(

b) and (

e) in that theyare “scandalous, frivolous or vexatious” or “otherwise an abuse of process” (although there has not been any reliance placed on the“scandalous” or “frivolous” criteria). It has been observed that the “scandalous, frivolous or vexatious” ground overlaps, to some degree,with the “abuse of process” ground. See Ross v Eastbourne Investments Ltd. (1994), (SK KB), 124 Sask R 97 (QB). [58] It is also clearly established that, unlike applications made to strike a claim pursuant to Rule 7-9(1)(

a) for notdisclosing a reasonable cause of action (where Rule 7-9(3) stipulates that “no evidence is admissible” and the court is to presume thetruth of the contents of the statement of claim), applications brought pursuant to Rule 7-9(2)(

b) or (

e) engage the merits of the claim. Thispoint was plainly made in Sagon v Royal Bank of Canada (1992), (SK CA), 105 Sask R 133 (CA) [Sagon], whereSherstobitoff J.A. explained as follows at para. 18: [18] Striking out an entire claim on the ground that it is frivolous, vexatious or an abuse of process of the court is based on an entirelydifferent footing. Instead of considering merely the adequacy of the pleadings to support a reasonable cause of action, it may involve anassessment of the merits of the claim, and the motives of the plaintiff in bringing it.

Evidence other than the pleadings is admissible.Success on such an application will normally result in dismissal of the action, with the result that the rule of res judicata will likely applyto any subsequent efforts to bring new actions based on the same facts. ... [Emphasis added] [59] As mentioned previously, in Bear, Richards J.A. confirmed that it is necessary for the Court to consider the fullpicture, and consider all of the relevant context and background. [60] In Paulsen, Ryan-Froslie J. (as she then was), provided a concise

summary of the meaning of some of theprovisions of Rules 7-9(2)(

b) and (

e) as follows: 45 An action is scandalous when it impugns the opposite party or makes degrading charges or allegations of misconduct or bad faith.(See: Bank of Montreal v. Giesbrecht, 2005 SKQB 18, [2005] S.J. No. 12 (QL) at para. 14; C & J Hauling Ltd. v. Mistik ManagementLtd., 2010 SKQB 60, 351 Sask.R. 199, at para. 15). 46 An action is “vexatious” if it was instituted for an ulterior motive (other than to enforce a true legal claim) or maliciously for thepurpose of causing trouble or annoyance to the defendants. (See: Tamarak Energy Inc. v.

IPSCO Inc., 1999 SKQB 125, 185 Sask.R.161 at para. 17; Bank of Montreal v. Giesbrecht, supra, at para. 11 and C & J Hauling Ltd. v. Mistik Management Ltd., supra, at para.15). 47 An action is “frivolous” if it is groundless and lacks substance (See: Chernoff v. Chernoff, [1988] S.J. No. 458 (QL) (Q.B.); Bank ofMontreal v. Giesbrecht, supra, at para. 13 and C & J Hauling Ltd. v.

Mistik Management Ltd., supra, at para. 15). 48 What constitutes an “abuse of process” was addressed in Bullen, Leake & Jacob’s, Precedents of Pleadings, 12th ed. (London: Sweet& Maxwell, 1975) at pages 148 to 149: The term “abuse of the process of the court” is a term of great significance. It connotes that the process of the court must be carried outproperly, honestly and in good faith; and it means that the court will not allow its function as a court of law to be misused but will in aproper case, prevent its machinery from being used as a means of vexation or oppression in the process of litigation.

It follows that wherean abuse of process has taken place, the intervention of the court by the stay or even dismissal of proceedings, “although it should not belightly done, yet it may often be required by the very essence of justice to be done.” The term “abuse of process” is often used interchangeably with the terms “frivolous” or “vexatious” either separately or more usually inconjunction. [61] Recently, in Solgi v College of Physicians and Surgeons of Saskatchewan 2022 SKCA 96, 473 DLR (4th) 421,the Court of Appeal noted that the above referenced “helpful

summary” has been adopted repeatedly in many judgments of this Court,but noted, that they do not contain an exhaustive statement of the applicable principles. [62] The terms “scandalous”, “vexatious” and “frivolous” although related, carry their own meaning. See Hope vPylypow, 2015 SKCA 26 at para 32, 384 DLR (4th) 255. However, the “abuse of process” ground overlaps with the “scandalous,frivolous and vexatious” ground such that often, substantially the same considerations apply to both grounds. See C & J Hauling Ltd. v

Mistik Management Ltd., 2010 SKQB 60, 351 Sask R 199. Commencing an action knowing no cause of action exists has been found tobe an abuse of process. See Gola v Zaporanik (1924), (SK CA), [1925] 1 DLR 34 (Sask CA). [63] It is with these principles in mind that I will undertake an assessment of Ms. Blom’s applications to strike Mr.Wollner-Kallis’s statements of claim. V. ANALYSIS

A) The Builders’ Lien Action [64] Striking a claim is a drastic action that ought not be lightly done. Afterall, our civil justice system is based onthe premise that parties should be able to make allegations and then have the opportunity to prove those allegations by calling evidenceat trial. Removing their chance to prove their claim short of trial by striking their claim, however, is necessary and appropriate where theinterests of justice require it. Such is the case here. [65] As indicated above, Ms. Blom and Mr. Wollner-Kallis were in a relationship and that relationship came to anend.

On the heels of the breakup, on December 11, 2021, Mr. Wollner-Kallis let himself into Ms. Blom’s condominium. He claims itwas to get some items that belonged to him. Ms. Blom became scared and called the police. Mr. Wollner-Kallis was charged with breakand enter, although the charge was subsequently stayed by the Crown. [66] According to Mr. Wollner-Kallis’s affidavit, on the same day as the “condominium incident”, he instructed hislawyer to commence the Builders’ Lien Action, which is the subject of this application, where he claims the significant sum of $166,500for alleged renovations and upgrades to Ms.

Blom’s condominium. Interestingly, there was no demand letter or even an invoice thatpreceded the instructions to commence the claim. Rather, it was full steam ahead with the claim. The claim was prepared andsubsequently filed with the court on December 17, 2021. Also, the builders’ lien was registered as an encumbrance on Ms. Blom’sproperty the day before. Ms. Blom was then served with the claim on December 20, 2021. The speed with which this whole processunfolded is, to say the least, unusual for what would otherwise be fairly described as a simple debt claim. There was no suggestion thatMs.

Blom was selling the property or that JoCo Investment’s debt, if legitimate, was about to be compromised. All the indicators point toan ulterior motive, beyond collecting a legitimate debt. [67] However, the mere fact that Mr. Wollner-Kallis moved with peculiar haste is not determinative. What is ofsignificance is the overwhelming and uncontroverted evidence that there were no renovations done -- at all. [68] Ms. Blom purchased her condominium in November of 2012. Her uncle saw the property at the time of thepurchase. He has been in the property, on a frequent basis, since. He confirms Ms.

Blom’s definitive and unmistakable statement thatthere were no renovations done at the condominium. It is safe to conclude that it would be readily apparent if renovations in the range of$166,500 were put into a property that was purchased in 2012 for $270,249. In the face of these absolute and definitive denials that therewere no renovations done on Ms. Blom’s condominium -- at all -- Mr. Wollner-Kallis offers nothing. If there was, indeed, $166,500worth of materials and labour expended on Ms. Blom’s residence, as Mr. Wollner-Kallis set forth in his claim, what was done, when wasit done, and who did it?

One could expect that if this were, indeed, a legitimate claim that it would be relatively easy to show somethingthat would provide a shred of evidence to at least raise the possibility that some renovations were done. [69] Instead of setting forth relatively simple evidence capable of providing some proof that some work was doneand some materials supplied, JoCo Investment attempts to rely upon technical grounds to divert attention from the merits.

JoCoInvestment points to Rule 13-18(1) of The Queen’s Bench Rules which states that allegations of fact not denied are deemed to beadmitted: 13-18(1) All allegations of fact that are not denied or stated in the pleadings not to be admitted are deemed to be admitted. [70] JoCo Investment’s argument on this point is an attempt to stretch the Rule beyond its meaning. Granted, in thiscase, a statement of defence has not yet been filed. In this context, that does not mean that the contents of the statement of claim aredeemed admitted by Ms. Blom. A notice of intent to defend has been filed.

Clearly Rule 13-18(1) is meant to create a presumption thatallegations (in a statement of claim) not denied (in a statement of defence) are deemed to be admitted. It does not mean that where, ashere, because a statement of defence has not yet been filed that all allegations in the statement of claim are deemed true. Not only wouldthis fly in the face of the principles mentioned above in cases such as Sagon, it does not give effect to the obvious purpose of the Rule. [71] Furthermore, there is no obligation, in these circumstances for Ms. Blom to file a defence before bringing theapplication to strike.

Rule 3-13 provides the defendant with options. It says: 3-13 A defendant who is served with a statement of claim may do one or more of the following: (

a) serve and file a statement of defence, notice of intent to defend or demand for notice; (

b) apply to the Court to set aside service in accordance with rule 12-1; (

c) apply to the Court for an order pursuant to rule 7-9; (

d) apply to the Court for an order pursuant to rule 1-6; (

e) apply to the Court for an order pursuant to rule 3-14. [Emphasis added] [72] JoCo Investment’s argument that there is evidence before the Court respecting the basis for the $166,500 debt is

wholly without merit. [ 73 ] I am compelled to the obvious and unmistakable conclusion that there was no work done or materials supplied by JoCo Investment with respect to Ms. Blom’s property and that this is a purely bogus action that was commenced for illegitimate reasons. I find that this action was commenced, knowing that no cause of action existed, and that it was done for an ulterior motive. Mr. Wollner-Kallis’s ulterior motives include spite, anger and to get back at his former partner.

This fits within both the “vexatious” and an “abuse of process” criteria. [ 74 ] I arrive at this conclusion without having regard to the January 2, 2022 conversation. The circumstances, even before factoring in the January 2, 2022 conversation, compel the conclusion that the claim is vexatious and an abuse of process. However, the January 2, 2022 conversation serves to confirm the above conclusion in all respects and adds a further dimension.

Not only was there a tacit admission that the claim was false, but there is a suggestion that one of the motivating factors for launching the action was to leverage the criminal charge. This too, is highly improper and amounts to the action justifiably being branded vexatious and an abuse of process. [ 75 ] Accordingly, I have little difficulty in concluding that the Builders’ Lien claim should be struck.

Also, pursuant to s. 60 of The Builders’ Lien Act , it is appropriate to order that the registration of the claim of lien and the certificate of action filed in conjunction with the struck action should be vacated.

B) The Defamation Action [ 76 ] The comments made concerning the haste and timing of the Builders’ Lien Action have equal application to the Defamation Action. Both were commenced at the same time and in similar circumstances. Arguably, though, there is a potential justifiable reason to have the Defamation Action commenced, issued and served quickly, if, as alleged, Mr. Wollner-Kallis was legitimately concerned with Ms.

Blom spreading defamatory and/or libelous and slanderous statements and/or publications. [ 77 ] As discussed, the examination of whether the Defamation Action is vexatious or an abuse of process involves an examination of all of the background factors.

This would include all the relevant circumstances mentioned above and the fact that the Builders’ Lien Action, issued on the same date as the Defamation Action, has already been found to be vexatious and an abuse of process. [ 78 ] The merits-based analysis of the Defamation Action leads me to the same conclusion reached in the Builders’ Lien Action, for much the same reasons. Mr. Wollner-Kallis alleged in his statement of claim that “since July 2021, Ms. Blom has made various improper and malicious remarks”.

In the statement of claim, which of course contains only allegations, not sworn facts, he provides some details, such as “coke head”, p**ss tank”, “womanizing” and “shifty shady business guy” -- however there are no details about specifically who said what to whom and when and how these statements were made or published. It is an open question as to whether Mr. Wollner-Kallis’s pleadings respecting defamation are sufficient. There are many cases that discuss the threshold requirements of a statement of claim alleging defamation. See, for example, PMC York Properties Inc. v Siudak , 2022 ONCA 635 .

However, I need not comment on whether the pleadings themselves are sufficient, because Ms. Blom’s application is not based upon a suggestion that the pleadings themselves, standing alone, are insufficient or do not disclose a reasonable claim. Her application is not grounded in Rule 7-9(2)(a), but has been brought pursuant to Rules 7-9(2)(

b) and (e). Thus, it is necessary to undergo a merits-based analysis to see if the claim is scandalous, frivolous, vexatious or amounts to an abuse of process. [ 79 ] Ms. Blom filed an affidavit in which she unequivocally states that she did not make the improper and malicious remarks attributed to her in Mr. Wollner-Kallis’s statement of claim or at all. In particular, she says that she denies that she has “... defamed or slandered Mr. Wollner-Kallis, or acted negligently towards Mr.

Wollner-Kallis by making any untrue or false statements regarding him, as alleged or at all, verbal or otherwise, since July 2021 [the date chosen by Mr. Wollner-Kallis in his claim]”. [ 80 ] Mr. Wollner-Kallis had the opportunity to file affidavit material in opposition to Ms. Blom’s claim and did so. However, his sworn material is absolutely silent on the merits of his claim, other than to an oblique reference in the context of comments relating to when he instructed his counsel to commence the Defamation Action.

In this regard, the following brief statement can be found: “I instructed Merchant Law Group LLP to launch the libel and slander proceedings against Ms. Blom … on December 12, 2021. As a result of receiving information regarding the slanderous and libelous statements that Ms. Blom was making about me which I feared would effect my reputation and my business interests”. There is nothing beyond that. Mr. Wollner-Kallis should have been able to provide some very basic information, in his sworn material, as to what Ms.

Blom was alleged to have said and how, when and where he received the information if such was the case. However, he chose not to provide that information, which creates a void within his position. [ 81 ] I need not repeat the reasons for rejecting his assertion that there are facts before the Court substantiating the allegations in the claim because of the effect of no defence being filed. My reasons in connection with the Builders’ Lien Action respecting the

interpretation of Rule 13-18(1) apply to the Defamation Action with equal application. [ 82 ] When one considers all of the circumstances, including the fact that the Defamation Action was launched with haste after a breakup and after the incident that ultimately resulted in Mr. Wollner-Kallis being charged criminally and that there is no evidence tendered respecting the veracity of Mr. Wollner-Kallis’s slander and defamation claim, I am compelled to the inescapable conclusion that the action is not well founded in that it is both vexatious and an abuse of process. It was commenced at a time when Mr.

Wollner-Kallis was angry with his former partner and was lashing back at her. The motivation for the action was not to pursue a legitimate legal interest, but to cause grief and consternation to Ms. Blom. [ 83 ] On this basis, I would strike the claim for being vexatious and an abuse of process. I would do this without even considering the January 2, 2022 conversation. However, when one factors that conversation into the mix of circumstances, it is even more apparent that the Defamation Claim should be struck.

A careful review of the conversation leads to the inescapable conclusion that neither action was launched in good faith with a legitimate legal goal, but rather for tactical purposes, one of which was to gain some type of leverage to have the criminal charge disposed of. As mentioned in the context of the analysis of the Builders’ Lien Action, the

courts should not and cannot countenance this type of behaviour. [ 84 ] As a result, the application to strike the Defamation Claim is granted. VI. COSTS [ 85 ] Counsel for Ms. Blom has requested that the Court award costs as between solicitor-and-client against JoCo Investment, Mr. Wollner-Kallis and his counsel on a joint and several basis.

He contends that this is a unique and exceptional circumstance where the behaviour of the respondents and that of his counsel in initiating and pursuing these claims is so scandalous, outrageous and reprehensible such that it is appropriate to award solicitor-and-client costs. Counsel for the respondents counters by saying that Ms.

Blom’s applications should be dismissed, and costs should be awarded against her. [ 86 ] Recently, Leurer J.A. in 6517633 Canada Ltd. v Gibson Creek Farms Ltd. , 2023 SKCA 19 , took the opportunity to summarize the basic principles relating to the award of solicitor-and-client costs where, at para. 46, he said this: 46 While courts have a general discretionary jurisdiction to award costs, solicitor and client costs are reserved for exceptional circumstances: Strand v Gilewich , 2007 SKCA 34 at para 14 , 293 Sask R 48 .

Appellate courts are “concerned to ensure that solicitor- client costs are awarded rarely” ( Phillips Legal Professional Corporation v Vo , 2017 SKCA 58 at para 150 , [2017] 12 WWR 779 ). Solicitor and client costs are justified only in “a relatively narrow set of circumstances” ( Lynch v Hashemian , 2006 SKCA 126 at para 31 , [2007] 2 WWR 52 ).

These were summarized by Jackson J.A. in Siemens v Bawolin , 2002 SKCA 84 at para 118 , [2002] 11 WWR 246 [ Siemens ] : 1. solicitor and client costs are awarded in rare and exceptional cases only; 2. solicitor and client costs are awarded in cases where the conduct of the party against whom they are sought is described variously as scandalous, outrageous or reprehensible; 3. solicitor and client costs are not generally awarded as a reaction to the conduct giving rise to the litigation, but are intended to censure behaviour related to the litigation alone; 4. notwithstanding point 3, solicitor and client costs may be awarded in exceptional cases to provide the other party complete indemnification for costs reasonably incurred. [ 87 ] In my view, with respect to Mr.

Wollner-Kallis and his corporation, JoCo Investment, I find that this is one of those “rare and exceptional cases” where their conduct in knowingly causing to have commenced unmeritorious claims to retaliate against a former partner and gain leverage in connection with a criminal charge that was pending justifies an award of solicitor-and-client costs against them. Not only were fabricated claims issued, one of those claims was used to base the registration of an improper interest against the title of Ms. Blom’s property. This, of course, would prevent Ms.

Blom from selling or otherwise using the property as security. These acts amount to conduct that is tainted with malice and falls within the categories of outrageous and reprehensible. Quite simply, the legal system should not be used in this way and any attempts to do so should be sanctioned by an award of solicitor-and-client costs. It is the only fair and just thing to do. [ 88 ] I will now turn to the question of whether the solicitor-and-client costs should also be awarded against the respondents’ lawyer.

I find that upon the facts and evidence before the Court at this time, there is an insufficient basis to extend the costs award to the respondents’ counsel. The material discloses that Mr. Wollner-Kallis retained Mr. Merchant to commence the claims. Mr. Wollner-Kallis presumably provided information to Mr. Merchant sufficient to permit Mr. Merchant and/or other lawyers or paralegals within his office to prepare and commence the claims. This information would have presumably included Mr. Wollner-Kallis’s assertions that Ms. Blom owed him $166,500.00 for work done to her condominium and that Ms.

Blom spoke/published defamatory words against Mr. Wollner-Kallis. Again, presumably, Mr. Merchant would have taken, at face value, the information presented to him by his client. The evidence falls short of establishing that Mr. Wollner-Kallis and Mr. Merchant conspired to commence and pursue false claims. While Mr. Wollner-Kallis should have known the claims were baseless, the same cannot be said about Mr. Merchant. In fact, the evidence before the Court is that Mr. Merchant could not have been complicit in commencing the claims for the purpose of attempting to influence the criminal charge because Mr.

Merchant did not even know that Mr. Wollner-Kallis had been charged criminally until August 13, 2022 when he was reviewing the applications and supporting materials relating to the matters before the Court at this time. [ 89 ] Accordingly, I am convinced that it is just and fair to award costs on a solicitor-and-client basis against Mr. Wollner-Kallis and JoCo Investment, but not against Mr. Merchant or his law firm. VII. CONCLUSION [ 90 ] It is hereby ordered that: 1.

The statement of claim commenced by Joseph Shane Wollner-Kallis against Ashley Lynn Blom, namely, QBG-RG-02739- 2021, is struck because it is vexatious and an abuse of process; 2. The statement of claim commenced by JoCo Investment Corp. against Ashley Lynn Blom, namely, QBG-RG-02740-2021, is struck because it is vexatious and an abuse of process; 3. The claim of lien and any related written notices of lien registered on behalf of JoCo Investment Corp. on the condominium belonging to Ashley Blom, including the certificate of pending litigation, is hereby vacated pursuant to s. 60 of The Builders’ Lien Act ; 4.

Ashley Lynn Blom is awarded costs, on a solicitor-and-client basis against Joseph Shane Wollner-Kallis, with respect to QBG-RG-02739-2021;

5. Ashley Lynn Blom is awarded costs, on a solicitor-and-client basis against JoCo Investment Corp., with respect to QBG-RG- 02740-2021; 6. Any of the parties have leave to seek further directions respecting the costs award, should they be unable to agree on the quantum of the solicitor-and-client costs respecting each action. C.J.K.B. M.D. POPESCUL