Supreme Court of Canada
Netupsky v. Craig, [1973] S.C.R. 55
Date: 1972:06-29
Boris Netupsky and Netupsky Engineering Company Limited (Plaintiffs) Appellants;
and
James B. Craig and Michael W. Kohler (Defendants) Respondents.
1972: March 23, 24; 1972: June 29.
Present: Judson, Ritchie, Hall, Spence and Laskin JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO.
Libel and slander—Alleged libel—No evidence defendants motivated by malice—Qualified privilege.
The Ontario Court of Appeal allowed an appeal from a judgment at trial, whereby it was ordered that the present appellant recover the sum of $250,000 and costs from the defendants for an alleged libel in à letter written to the Director of Property of the City of Ottawa. The defendants relied principally on the defence of qualified privilege.
The appellant N was a professional engineer. An architect, one H, in co-operation with N, decided to enter plans in a design competition for the Ottawa Civic Centre. H won the competition and became associated with the respondents as architects for the project. He requested N to prepare further structural steel drawings which were duly submitted and which formed the basis of the call for tenders with respect to the steel to be incorporated in the structure.
D Co. was the successful bidder for the steel portion of the contract. Certain modifications were made by D Co. in the original drawings and when N was asked to approve the suggested changes he refused to do so on the ground that they invalidated his original drawings and he stated that if the new design was proceeded with a new agreement would have to be made with him with respect to his fees. Such agreement was not reached, and, in view of time requirements, the respondents felt compelled to engage the services of another structural engineer (A) to prepare the drawings which N had refused to complete, and generally to act in the capacity of consulting engineer.
On being advised by H that D Co. had proceeded with the erection of the superstructure in accordance with the altered design for which it, in company with A had accepted full responsibility, N sent to the
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“Director of Planning and Works” a telegram, in which he referred to his statement to the architect that he considered “this procedure not only invalidates the original design of the entire structure as detailed on my firm’s drawings, but also places the whole project on an uneconomical and unsafe structural basis”.
Immediately after receiving the telegram, the director wrote to the respondents asking for a report on the matter. A letter of reply written by the second respondent on behalf of himself and his partner contained the alleged libel. The letter stated, inter alia, that “[D Co.] during their checking of [N’s] drawings suggested certain changes to increase the safety of the building and to reduce the cost. We as architects, mindful of our responsibility for safety, chose to accept the advice of the very experienced engineers of [D Co.] rather than that of [N].”
Held: The appeal should be dismissed.
The determination of this appeal turned on the question of whether there was any extrinsic or intrinsic evidence that the respondents were motivated by malice in writing the letter which was complained of. The Court agreed with the Court of Appeal that if the allegedly libellous words were not wholly unconnected with or irrelevant to the duty or interest by reason of which the occasion of qualified privilege arose, they were presumed to have been published in good faith—a presumption which was entitled to prevail unless the plaintiff proved by extrinsic or intrinsic evidence that they had been published maliciously. The basis for the privilege arose from the fact that the statements were made in the conduct of the defendants’ own affairs in a manner in which their own interest was concerned.
The view taken by the majority of the Court of Appeal that there was no evidence of malice to go to the jury and that the action should be dismissed on that ground was approved.
APPEAL from a judgment of the Court of Appeal for Ontario[1], allowing an appeal from a judgment of Haines J. Appeal dismissed.
Boris Netupsky, plaintiff, appellant, in person.
C.L. Dubin, Q.C., for the defendants, respondents.
The judgment of the Court was delivered by
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RITCHIE J.—This is an appeal from a judgment of the Court of Appeal of Ontario (Gale C.J.O. dissenting in part) allowing an appeal from a judgment pronounced by Haines J., whereby it was ordered that the present appellant recover the sum of $250,000 and costs from the defendants for an alleged libel published by the defendants in a letter written to the Director of Property of the Corporation of the City of Ottawa on May 10, 1966.
The circumstances giving rise to this appeal have been fully and accurately set out in the reasons for judgment delivered by Schroeder J.A. on behalf of the majority of the Court of Appeal and as these reasons for judgment have now been reported in 14 D.L.R. (3d) 387 at p. 390, I consider it to be sufficient for the purposes of disposing of the present appeal that I should do no more than summarize the sequence of events which were the immediate cause prompting the respondents to publish the letter containing the alleged libel.
The appellant, Boris Netupsky, is a professional engineer residing in Vancouver, British Columbia, and is the president of the other appellant, Netupsky Engineering Co. Ltd., in which he held the controlling interest.
An architect named Gerald Hamilton, who practised in Vancouver, B.C., had devised a novel idea of a structure which could serve the dual purpose of an outdoor stadium and an indoor ice arena, the construction of which necessarily involved a high content of structural steel, and feeling that the realization of this concept required the advice of a structural engineer, he consulted Netupsky and they collaborated with a view to the erection of such a combined stadium and ice arena.
In May 1965 the City of Ottawa instituted a design competition with a view to constructing a new outdoor stadium and indoor arena as a centennial project. Hamilton, in co-operation with Netupsky, decided to enter his plans in the design competition and in the month of July it was announced that he had won the competition and that Ottawa was ready to proceed with the project. In this regard, Hamilton became associated with the respondents as architects for the
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project and he requested Netupsky to prepare further structural steel drawings which were duly submitted and which formed the basis of the call for tenders with respect to the steel to be incorporated in the structure.
Dominion Bridge Company Limited was the successful bidder for the steel portion of the contract, but as time went on it appeared that the cost of steel was going to be very much higher than had been anticipated and that the total price for the project on the basis of the drawings submitted would be substantially higher than the city’s budgetary limit. Modifications were accordingly made in the original drawings with a view to reducing the overall cost of the required steel and when Netupsky was asked to approve the suggested changes he refused to do so on the ground that they invalidated his original drawings and he stated that if the new design was proceeded with a new agreement would have to be made with him with respect to his fees. In this regard, he wrote to Gerald Hamilton on March 8, 1966, as follows:
Please be advised that we are not prepared to redesign or review the submitted redesign of the steel superstructure without coming to a mutually agreeable arrangement as to our fee for this work, as well as for the work of re-appraising the substructure and the prestressed concrete elements.
In the result no such “mutually agreeable arrangement” was reached with Netupsky and as time was a most important factor in view of the fact that the proposed structure was intended as a centennial project, the respondents felt compelled to engage the services of another structural engineer (Mr. Adjeleian) to prepare the drawings which Netupsky had refused to complete, and generally to act in the capacity of consulting engineer. When Hamilton advised the appellants that the Dominion Bridge Company had proceeded with the erection of the superstructure in accordance with the altered design for which it, in company with Mr. Adjeleian had accepted full responsibility. Netupsky reacted violently as is evidenced by the highly provocative telegram which he sent to the “Director of Planning and
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Works, Corporation of the City of Ottawa, Ontario” on May 4, 1966, in the following terms:
Re Ottawa Civic Centre at Lansdowne Park STOP Due to information now made available to me by the architect relative to a proposed redesign of the steel superstructure by Dominion Bridge as well as evidence of noncompliance with certain other requirements called for on my firm’s drawings I must bring to your immediate attention my statement to the architect that being the engineer retained by him under contract and licensed by the Ontario Professional Engineers Association to design the said structure, I consider this procedure not only invalidates the original design of the entire structure as detailed on my firm’s drawings, but also places the whole project on an uneconomical and unsafe structural basis STOP Upon your request I will be pleased to go to Ottawa at my own expense to answer any queries you may have.
Separate telegrams in identical terms were sent to the Building Inspector of the city and to the Municipal Council. Immediately after receiving the telegram, the Director of Property for the City of Ottawa, who was directly concerned with the Civic Centre project, wrote a letter to the respondents which read, in part, as follows:
I attach copy of a telegram from Boris Netupsky, P. Eng., Netupsky Engineering Co. Ltd., your structural consultant for the Ottawa Civic Centre. Will you furnish a report on this matter within 48 hours with particular attention to the remarks concerning the safety of the structure.
It was in reply to this letter from the city and in light of the highly provocative and damaging language used by the appellants in criticism of the procedure for which the respondents were responsible that Kohler wrote the letter on behalf of himself and his partner, the respondent Craig, which contained the alleged libel. The letter is reproduced in full in the reasons for judgment of Schroeder J.A., in 14 D.L.R. (3d) at p. 398, and the following language contained in that letter constitutes the alleged libel complained of in the statement of claim.
Dominion Bridge during their checking of Netupsky’s drawings, suggested certain changes to increase the
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safety of the building and to reduce the cost. We as Architects, mindful of our responsibility for safety, chose to accept the advice of the very experienced Engineers of Dominion Bridge rather than that of Boris Netupsky. This action was agreed to by Mr. John Adjeleian, the Ottawa Structural Engineer whom we have engaged to supervise the construction. We have, therefore ceased to consult with Mr. Netupsky since mid-February.
He is disgruntled that we are no longer consulting with him and is trying to force us to pay him for work that he has not done to our satisfaction. We wish to give you a firm assurance that his allegations that the revisions we have made to the structure places the whole project on an uneconomical and unsafe structural basis’ are completely false, groundless, untrue and libellous.
In order to assess the meaning to be attached to this language, I think it desirable to reproduce the last paragraph of that letter which reads:
In support of this statement we enclose a letter from the Dominion Bridge Company dated May 9th. in which they certify in the name of the company that the design has been checked by them and is fully adequate, and a letter from John Adjeleian that he has checked and is continuing to check all matters concerning the safety of the concrete work. You have our assurance that this building has been designed and will be built conforming to all building by-laws and sound engineering principles and will be perfectly safe.
The respondents relied on the defences of qualified privilege and fair comment, but the question raised by this appeal is concerned almost exclusively with the nature and effect of the defence of qualified privilege, in relation to which I adopt the following paragraphs contained in the reasons for judgment of Mr. Justice Schroeder at p. 407:
The defendant did not rely on justification as a defence but depended principally on the defence of qualified privilege. It was the duty of the trial Judge to decide and rule upon the question as to whether the allegedly libellous words were wholly unconnected with and irrelevant to the duty or interest by reason of which the occasion of qualified privilege arose. If the words were not wholly unconnected with or irrelevant to such duty or interest, they were pre-
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sumed to have been published in good faith—a presumption which was entitled to prevail unless the plaintiff proved by extrinsic or intrinsic evidence that they had been published maliciously.
It is common ground that the statements made by the defendant to the City authorities related to a subject-matter in which the defendants and the City had a legitimate and common interest and were on that ground protected as statements made on an occasion of qualified privilege. A more apposite and firmer basis for the privilege arises from the fact that the statements were made in the conduct of the defendants’ own affairs in a manner in which their own interest was concerned. More specifically, they were replying to an unfair and unwarranted attack upon their professional integrity and competence which they were justified in repelling by a denial and explanation. This forms a more substantial and more relevant foundation for the privilege, and entitles the defendants to considerably wider latitude than does the basis upon which the learned trial Judge rested it.
(Italics are my own.)
I agree also with the opinion expressed by Mr. Justice Schroeder where he said in the course of his reasons for judgment at p. 404:
In my respectful opinion, the failure to tell the jury that when words are spoken or written on an occasion of qualified privilege the bona fides of the defendant and his honesty of belief in the truth of his statements is presumed and that the burden then lies upon the plaintiff to rebut that presumption constitutes serious non-direction amounting to mis‑direction:… The manner in which this portion of the charge was submitted to the jury was a direction that the defendant had the burden of satisfying them upon that issue, and that if he failed to do so he was liable in damages. The circumstances of this case made it essential that the jury should have been correctly instructed upon this point, otherwise their whole approach to the determination of this highly material issue would rest upon an improper basis.
The determination of this appeal in my opinion, turns on the question of whether there was any extrinsic or intrinsic evidence that the respondents were motivated by malice in writing the letter which is complained of. There can be little
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doubt that if there is evidence proving that the statements complained of are false to the knowledge of the person who makes them, they are taken to have been made maliciously, but this statement must be read in the light of the language used by Lord Atkinson in Adam v. Ward[2], at p. 339, where he said:
...a person making a communication on a privileged occasion is not restricted to the use of such language merely as is reasonably necessary to protect the interest or discharge the duty which is the foundation of his privilege; but that, on the contrary, he will be protected, even though his language should be violent or excessively strong, if, having regard to all the circumstances of the case, he might have honestly and on reasonable grounds believed that what he wrote or said was true and necessary for the purpose of his vindication, though in fact it was not so.
Mr. Justice Schroeder took the view that there was no evidence of malice to go to the jury and that the action should be dismissed on that ground, but Chief Justice Gale, in the course of his dissenting reasons for judgment, while agreeing in all other respects with Mr. Justice Schroeder, expressed the opinion that there was some intrinsic evidence upon which a jury might have found that two sentences in the letter complained of contained statements that were false to the knowledge of the respondent and he would therefore have directed a new trial so that another jury properly instructed would have an opportunity to determine this issue.
The sentences which gave rise to Chief Justice Gale’s dissenting opinion read as follows:
Dominion Bridge during their checking of Netupsky’s drawings suggested certain changes to increase the safety of the building and to reduce the cost. We as Architects, mindful of our responsibility for safety, chose to accept the advice of the very experienced Engineers of Dominion Bridge rather than that of Boris Netupsky.
The learned dissenting judge expressed the view that the jury might reasonably interpret those two sentences as meaning and having been intended to mean, that Dominion Bridge Co. Ltd. suggested that changes to Netupsky’s drawings
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were necessary to increase the safety of the building which might be unsafe without them and that the respondent had accepted these suggestions and decided to abandon or substantially improve upon Netupsky’s design, all of which might be taken to mean that the Netupsky design evidenced his incompetence.
Any consideration of the language used by the respondent in the letter complained of must be assessed against the background of the appellant’s telegram to the “Director of Planning and Works” of the City of Ottawa which highly provocative communication had been circulated in such fashion as to do the greatest possible damage to the respondents and which was, of course, the exciting cause which prompted Kohler to write the letter complained of. In this regard I find the language used by Lord Shaw in Adam v. Ward, supra, at p. 347 to be particularly apt:
Furthermore, it has to be borne in mind, with regard to the whole question of the repudiation of a false charge, that it has not to be weighed in nice scales.
The sentences cited by Chief Justice Gale must be read in their context which in my opinion includes the letters from Dominion Bridge Co. Ltd. and the structural engineer which were enclosed with the respondents’ letter and by which it was expressly stated to be supported.
In the course of its letter, Dominion Bridge Co. said:
For the past six months, we have been engaged in checking the structural steel design and requesting modifications thereto, wherever they appeared to be desirable with regard to structural safety and economics.
And the letter from Mr. Adjeleian (the structural engineer) read, in part, as follows:
We wish to confirm to you that my firm, as supervising structural engineers for the above project, have carried out a careful check, and are continuing to do so, on the concrete work, including foundations, for its structural adequacy, conformity on codes and safety.
We have made certain recommendations to you for revisions which, in our opinion, will ensure the safety of the structure.
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It is true that the words used in the letter complained of by the appellants cited by Chief Justice Gale were not a verbatim reproduction of the information furnished by Dominion Bridge Co. and the structural engineer, but it nevertheless appears to me that under the circumstances they did not constitute any evidence of malice but on the contrary were amply justified. The bridge company had said:
...we have been engaged in checking the structural steel design and requesting modifications thereto, wherever they appear to be desirable with regard to structural safety and economics.
and the letter complained of said:
Dominion Bridge during their checking of Netupsky’s drawings suggested certain changes to increase the safety of the building and to reduce the cost.
The difference in language between the two statements does not, in my opinion, involve a change in meaning. In using the words contained in the cited paragraph of the letter, Kohler was not making any statement without having reasonable grounds for believing that what he said was true, namely that the changes suggested by Dominion Bridge were made for the purpose of increasing the safety of the building and reducing its cost. For this statement he had the authority of the steel company itself and of the supervising structural engineer, and with the greatest respect for the views of Chief Justice Gale, I do not think that the sentences which he cites could be reasonably interpreted so as to afford any evidence of intrinsic malice in the circumstances of this case.
For all these reasons, as well as for those stated by Mr. Justice Schroeder, I would dismiss this appeal with costs.
Appeal dismissed with costs.
Solicitors for the plaintiffs, appellants: Scott & Aylen, Ottawa.
Solicitors for the defendants, respondents: Gowling & Henderson, Ottawa.