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Statutory Immunity And Qualified Privilege Protect City Councillor Against Night Club’s Action – Libel & Defamation


In the past few months, I have written a number of blogs about
court decisions involving City Councillors. The courts and other
processes available to hold politicians accountable, such as
complaints to an integrity commissioner, have arguably become a
weapon in the arsenal of those who disagree with the views of a
politician. Although seeking a remedy from a court or having an
integrity commissioner determine whether a politician has breached
a Code of Conduct are proceedings worthy of merit where a wrong has
been done, recent rulings show that politicians have strong
defences to these proceedings, especially court proceedings, where
the politician has acted in good faith and simply expressed a
political opinion or advocated on behalf of his or her
constituents.

In 1631561 Ontario Inc. v. Toronto (City),
2022 ONSC 4197 (CanLII)
, the court dismissed a claim
brought by an after-hours dance/rave nightclub against former City
Councillor Adam Vaughan and the City of Toronto on the grounds that
he was protected against the action by the defences of statutory
immunity and qualified privilege.

The nightclub operated in Toronto’s popular Entertainment
District. The nightclub was designated for restaurant use in a
mixed commercial-residential area. Mr. Vaughan was the elected
municipal politician for the area.

In 2008, Mr. Vaughan, various city officials and departments,
and the Toronto Police became involved with the nightclub’s
operations. On January 31, 2008, Mr. Vaughan’s office received
a call from a Hamilton woman whose son had died from a drug
overdose. Illegal drugs had caused the overdose. Although the drugs
were bought at an unknown location, the woman contacted Mr.
Vaughan’s office seeking assistance into the investigation of
her son’s death.

Thereafter, Toronto Police allegedly began to investigate
activities taking place at the nightclub and on March 16, 2008,
executed a search warrant of the club. 90 police officers, the
Emergency Task Force, the OPP Biker Enforcement Unit and an officer
wearing an RCMP jacket were involved. A Toronto Sun journalist was
also allegedly invited by the Toronto Police to witness the search
warrant’s execution.

From April 6, 2008 to March 6, 2009, City officials undertook
various inspections of the nightclub. Among other things,
Building Code Act and
Smoke-Free Ontario Act
violations and infractions were noted. Tickets and summonses were
issued against the nightclub.

During this period of time, there were also various
communications between Mr. Vaughan’s office staff and city
officials, and between Mr. Vaughan and the police about the
nightclub. As well, Mr. Vaughan’s office received complaints
from area residents related to the general area in which the
nightclub carried on business and about the nightclub
specifically.

Four days after the police executed the search warrant, Mr.
Vaughan sent an email to a residents association and constituents
about activities in the area of the nightclub. Mr. Vaughan later
spoke to the owner of the property where the night club was
located. He also refused to meet with night club representatives
and either personally or through his office staff wrote to various
committees and others about the night club and a neighbouring
tenant that wanted a variance for its outdoor patio.

The night club sued the defendants for misfeasance in public
office, abuse of public office, unlawful interference with economic
relations and/or alternatively conspiracy to defame and conspiracy
to injure.

With respect to the defamation claim, the night club contended
that Mr. Vaughan had committed this tort when he made statements to
the night club’s landlord that kids had died from drug
overdoses at the club. The night club also alleged that Mr. Vaughan
made defamatory comments about the club in his communication to the
residents association and other constituents, and in a letter to
the Committee of Adjustments about the patio variance
application.

The night club alleged that Mr. Vaughan acted in bad faith and
did everything he could to shut down the night club.

The night club was eventually closed when the owner demolished
the building out of the which the club operated.

Statutory immunity defence

Mr. Vaughan succeeded in having the night club’s claim
against him dismissed under the statutory immunity defence because
the court found that he did not act in bad faith.

The Municipal Act, 2001 and the
City of Toronto Act, 2006
(“COTA”) both contain a statutory immunity defence which
protects, among others, members of city council, officers,
employees or agents of the City from proceedings against them for
damages where they have acted in good faith.
Section 391(1)
of COTA specifically states:

No proceeding for damages or otherwise shall be commenced
against a member of city council, an officer, employee or agent of
the City or a person acting under the instructions of the officer,
employee or agent for any act done in good faith in the performance
or intended performance of a duty or authority under this Act or a
by-law passed under it or for any alleged neglect or default in the
performance in good faith of the duty or authority.

The court found that throughout, Mr. Vaughan was acting in his
capacity as a City Councillor and that he was legitimately
representing his constituents, as he was entitled and expected to
do.

The concept of bad faith by a public official has received
judicial consideration.

In Enterprises Sibeca Inc. v. Frelighsburg
(Municipality
), 2004 SCC 61
, the court said that
the “…concept of bad faith can encompass not only acts
committed deliberately with intent to harm, which corresponds to
the classical concept of bad faith, but also acts that are so
markedly inconsistent with the relevant legislative context that a
court cannot reasonably conclude that they were performed in good
faith.”

The evidence did not support either category of bad faith.

Qualified privilege defence

Mr. Vaughan also relied on the qualified privilege defence in
connection with the night club’s defamation claim. This defence
protects a person against such a claim where he or she has an
interest or a duty (legal, social or moral), to make a
communication to a person who has a corresponding interest or duty
to receive the communication.

At
paragraph 124
, the court described that qualified
privilege protects statements made by public officials, including
communications between members and public officials on matters of a
public interest, and is assessed on an objective basis.

Furthermore, the court explained that:

  • public officials have a duty to keep each other, the government
    and the public informed on matters related to the public and on
    matters falling within their competence;

  • a councillor’s freedom of expression is crucial for
    achieving effective participation and transparent management of
    municipal affairs; and

  • communications from constituents to city officials are
    protected where there is a personal, social and civic interest and
    that the city has a corresponding civil and civic interest in
    receiving it.

The Supreme Court of Canada in Prud’homme v. Prud’homme, 2002
SCC 85 (CanLII)
has stated that a municipal
politician’s freedom of expression is important to the
preservation of democracy. The court has recognized that Members of
Council are the voices of their constituents and their right cannot
be limited without negatively impacting democracy.

The court found that Mr. Vaughan was entitled to comment and
communicate on the impact of the night club to the surrounding area
and to voice his concerns about the patio variance that was being
sought by a neighbouring business.

Although the defence of qualified privilege can be defeated by
malice, the court held that there was no evidence that Mr. Vaughan
acted with malice. Mr. Vaughan was found to have had a legitimate
concern about the night club’s activities and its impact on the
community. He was also found to have a legitimate desire to take
appropriate steps to address the issues.

Dismissal of misfeasance in public office and abuse of public
office claims

With respect to the claims related to misfeasance in public
office and abuse of public office, the court rejected these causes
of action on the grounds that the plaintiffs had failed to prove
that there was any link between the conduct of public officials and
the Toronto Police or that the actions of Toronto Police, including
their presence at the night club, was at the direction of the
public officials or Mr. Vaughan.

Dismissal of the interference with economic relations
claim

The tort of interference with economic relations is narrow.

To be successful in such a claim, a plaintiff must establish the
following three elements:

  1. that the defendant intended to injure the plaintiff’s
    economic interests;

  2. that the interferences must have been by illegal or unlawful
    means; and

  3. that the plaintiff suffered economic harm or loss as a
    result.

This tort is also only available where:

a) the defendant committed an unlawful act against a third
party; and

b) the unlawful act intentionally caused harm to the
plaintiff.

The plaintiff did not meet its burden of proof against Mr.
Vaughan or the City.

The court concluded that the defendants did not commit any
unlawful act against a third party, and that, in any event, there
was no evidence that it had suffered any loss because of Mr.
Vaughan’s conduct or the conduct of any public official. In
determining whether any of the actions of the public officials
caused damages to the plaintiff, the court applied the “but
for” test.

Representing the public is not easy. Politicians are required to
tackle important issues that often involve competing interests.
Although this may sometimes result in the commencement of a lawsuit
against a politician, this case demonstrates that politicians who
act in good faith and simply do their job to represent the views of
the public and to advocate on their behalf, without malice, will be
able to emerge from a legal action unscathed.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.



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