Court of Appeal

CASE NO.                                                   VOL. NO.                                              PAGE

Cite as: Nova Scotia (Attorney General) v. Hiltz and Seamone Company,

1999 NSCA 22

ATTORNEY GENERAL OF NOVA SCOTIA                                      HILTZ and SEAMONE

and SHARON VERVAET                                                                         COMPANY LIMITED

(Appellants)                                                    - and -                                                 (Respondent)

C.A. No. 145621                                      Halifax, N.S.                                           Pugsley, J.A.

APPEAL HEARD:                                 November 13, 1998

JUDGMENT DELIVERED:                 February  9, 1999

SUBJECT:              Defamation; evidence on non-suit motion, pleadings, aggravated damages for corporate plaintiff, pre-judgment interest, appeal from findings of trial judge, jurisdiction of the Court of Appeal to award damages.

BACKGROUND:  The trial judge sitting without a jury allowed an action for libel and awarded the corporate plaintiff general damages of $200,000 against both appellants, and punitive damages of $100,000 against the appellant, the Attorney General. The appellants submit the trial judge erred in failing to dismiss the action at the close of the respondent's case, or alternatively, erred in failing to dismiss the action after all the evidence was concluded on the basis of one or more of the defences raised, including qualified privilege, fair comment and justification. They also submitted that damages were excessive, the pleadings filed by the respondent did not raise the key issue of malice, or the issue of the conduct of the manager of  the department in question. Further, the trial judge erred when she assessed damages as of the date of her decision, and then awarded pre-judgment interest at commercial rates. The Court of Appeal was asked to award damages in view of the appellants' persistence in continuing to submit, throughout the appeal, that their actions were justified.

The respondent cross-appealed, submitting the trial judge erred when she failed to award aggravated damages for the conduct of the appellant, the Attorney General, both within and outside court, on the ground that aggravated damages were not available to a corporate plaintiff.

                                                                           - 2 -

RESULT:     The Court allowed the appeal with respect to the issue of pre-judgment interest. The trial judge erred in failing to apply the principle in Bush v. Air Canada (1992), 109 N.S.R. (2d) 91(A.D.). The principle in that case is not affected by the decision of the Supreme Court of Canada in  Botiuk v. Toronto Free Press Publications Ltd. [1995], 3 S.C.R. 1, which was based on provisions of the Judicature Act of Ontario.

The Court dismissed the balance of the appeal and the cross-appeal.

The trial judge was correct in dismissing the non-suit motion as the respondent had met the evidentiary burden on the three critical issues required.

The publications took place on occasions of conditional, or qualified, privilege. The trial judge was correct when she concluded the qualified privilege was defeated because the limits of the duty, or interest, were exceeded, and further, because the dominant motive for publishing was actual, or express, malice.

The defence of fair comment did not apply because the statements were expressed as "statements of fact". Even if considered to be statements of opinion, they were made with malice.

Although the statement of claim did not allege that the appellants acted with malice, the trial judge committed no error when she concluded malice was a live issue. The Civil Procedure Rules in Nova Scotia do not provide for the delivery of a reply and are different from those Rules in other jurisdictions.   The issue of express malice was raised by the appellants in the amended defence and accordingly, material statements of fact were deemed to have been denied and put in issue by virtue of the provisions of C.P.R. 14.23(1).

In addition, the claim for punitive damages advanced in the statement of claim directly placed the motive of the appellants in issue.

The award of damages in one libel case is rarely, if ever, a useful guide in another. There was evidence supporting the trial judge's conclusion with respect to the award of general damages and punitive damages.

The failure of the appellants, in the absence of any explanation, to adduce evidence from four individuals who one might reasonably conclude would have provided important evidence for the appellants on significant issues, left the trial judge in a position where she could interpret the record on these issues in a manner adverse to the appellants.

                                                                           - 3 -

While the trial judge was correct in failing to award aggravated damages to the respondent because, as a corporate body, it was not entitled to compensation for injury to hurt feelings, such a claim might be available to a corporate body arising from the conduct of a defendant, both within, and outside court. In this case, all of these items were considered by the trial judge and formed a part of the general damage claim. They were also taken

into consideration by the trial judge when she awarded "lump sum" costs in addition to normal costs. Accordingly, the respondent was compensated for these additional items.

There was no evidence that the appellants had persisted in their plea of justification throughout the appeal, in bad faith, or that the appellants knew the plea was bound to fail. Accordingly, it was not necessary to determine the threshold issue of whether the Court of Appeal should consider awarding aggravated damages when an appellant, mala fide, persists in a plea of justification.