One Sunday each month OnPoint Legal Research provides Slaw with an extended summary of, and counsel’s commentary on, an important case from the British Columbia, Alberta, or Ontario court of appeal.
Level One Construction Ltd. v. Burnham, 2019 BCCA 407
AREAS OF LAW: Defamation; Test for Defamatory Statements; Fair Comment; Justification.
~The correct test for determining whether an impugned statement is defamatory is to examine the statement from the perspective of a reasonable, right-thinking person. While the courts should not seize upon the least favourable interpretation, it is an error for a trial judge to feel bound to choose the least harsh interpretation.~
This was an action for defamation. The plaintiffs were a home construction and renovation company (“Level One”) and its president. Level One was contracted by the defendant to perform certain renovations on her home, for which she paid a $5,000 deposit. A dispute arose between the parties as to what work had been requested; Level One provided the defendant with a revised (and increased) estimate to reflect a larger scope of work. One of Level One’s employees said she had the option of cancelling and requesting her deposit back. It was not clear whether he actually had the authority to return her deposit, but at trial it was found that he believed he had that authority and conveyed that belief to the defendant.
The defendant cancelled her contract. Level One offered to refund part of her deposit, minus an unspecified “administrative fee”. A series of communications between the parties ensued; the defendant told Level One she would tell everyone she knew about her negative experience with them. The trial judge accepted the defendant’s characterization of the communications from Level One as unpleasant and intimidating. The defendant also commenced a small claims action to recover the entirety of her deposit.
The defendant also emailed various media outlets about her experience. Ultimately, she posted a negative Yelp review and was interviewed by the CBC, which ended up in both TV and online news stories.
The plaintiffs sued in defamation, naming the defendant, the CBC, the CBC’s reporters, and various other individuals connected with the publication of the TV and online stories.
The trial judge found that none of the interview, TV story, or online story was defamatory. The trial judge went on to consider the defences in case she was wrong about whether the prima facie case of defamation had been made out. She concluded that the individual defendant had made out a justification defence for all of her statements except for one; further, the individual defendant could rely on the defence of fair comment, and she did not act with malice. The CBC defendants, in turn, were entitled to rely on the defence of responsible communication.
The plaintiffs appealed. The first ground of appeal was that the trial judge had applied the wrong legal test to the question of whether the statements were defamatory. The Court of Appeal agreed. For a statement to be defamatory, the questions are: are the words reasonably capable of having a defamatory meaning (which is a question of law), and do the words used have a defamatory meaning (a question of fact). In determining that second question, the trial judge had said she was obliged to choose the least harsh interpretation. That was an error of law as it applied the wrong test: the courts are to “avoid seizing upon the worst possible meaning”, but that is not the same as being compelled to prefer the least harsh interpretation. The correct test is to examine the impugned statement from the perspective of a reasonable, right-thinking person.
That conclusion (as noted at para. 54 of the BCCA reasons) would not have been enough to allow the appeal, since the trial judge had also found the defence of fair comment applied. This was the focus of the appellant’s second ground of appeal. For that defence to apply, the comment must be based on fact. However, the trial judge had found that the individual defendant had known that the difference between the two estimates she had received were for different projects. Her statements in the interview that the estimates had doubled “for the same job” was not a “subjective belief”, but contradicted the underlying facts. The trial judge omitted two key facts from the fair comment analysis: that the scope of work covered by the two estimates differed, and the individual defendant knew the work was not the same. Omitting these facts, in the Court of Appeal’s view, amounted to an error of law.
In the result, the appeal was allowed and a new trial was ordered.
Comments by Alan McConchie, counsel for the Appellants:
“Level One is authority for the proposition that even where a trial judge correctly states the legal principles for determining if statements are defamatory, the Court of Appeal will examine the trial judge’s reasons to determine whether those principles were correctly applied. If not, the trial judge will have erred in law.
In its discussion of the applicable principles for “determining whether the impugned words are defamatory” the British Columbia Court of Appeal emphasized that “a court must not strain to interpret words in a mild or inoffensive sense in order to relieve a defendant from liability” (at para. 46).
The plaintiffs had alleged that various statements by the defendant Marla Burnham bore certain inferential defamatory meanings. The Court reinforced that it is an error of law to require a plaintiff to present evidence about the meaning of the impugned expression where a plaintiff relies upon the inferential meaning of the words; when this means of proof is relied upon, the meaning must be determined objectively and no evidence concerning the meaning of the words is admissible.
In its discussion of the defence of fair comment, the Court held that the omission of critical proven facts from an impugned publication will be fatal to the defence.
The Supreme Court of Canada in WIC Radio Ltd. v. Simpson, 2008 SCC 40 endorsed the following formulation of the elements of the defence of fair comment proposed by Justice Dickson, in dissent, in Cherneskey v. Armadale Publishers Ltd.,  1 S.C.R. 1067:
(a) the comment must be on a matter of public interest;
(b) the comment must be based on fact;
(c) the comment, though it can include inferences of fact, must be recognisable as comment;
(d) the comment must satisfy the following objective test: could any [person] honestly express that opinion on the proved facts?
(e) even though the comment satisfies the objective test the defence can be defeated if the plaintiff proves that the defendant was [subjectively] actuated by express malice.
WIC Radio also cited Ross v. New Brunswick Teachers’ Assn., 2001 NBCA 62, which adopted the following reasons of Lord Denning in London Artists Ltd. v. Littler,  2 Q.B. 375 at 491:
… In order to be fair, the commentator must get his basic facts right. The basic facts are those which go to the pith and substance of the matter: … They are the facts on which the comments are based or from which the inferences are drawn — as distinct from the comments or inferences themselves. …
In Level One, two of Burnham’s statements involved allegations that the plaintiffs had doubled the price for the same job/work. The Court held that the omission of “two critical facts” from her publications ((1) the price did not double for the same job/work; and (2) Burnham knew that) resulted in the impugned statements not being based on facts that go to the pith and substance of the comments. The remaining facts underlying the comments could not be regarded as a true statement of fact. The omissions also resulted in the statements not being recognizable as comment. A “comment” includes a “deduction, inference, conclusion, criticism, judgment, remark or observation which is generally incapable of proof”. Burnham’s statements that the price doubled for the same job/work were capable of proof. Therefore, her statements could not meet the test of fair comment.”