SCC defamation ruling sends mixed messages

The Supreme Court of Canada decision this June in a multi­jurisdictional defamation case was relatively clear-cut in the result, with six judges finding that Israel was the appropriate forum for an action brought by a Canadian businessman against the newspaper Haaretz.

SCC defamation ruling sends mixed messages
Paul Schabas says there is some clarity in the main judgment of Haaretz.com v. Goldhar.

The Supreme Court of Canada decision this June in a multi­jurisdictional defamation case was relatively clear-cut in the result, with six judges finding that Israel was the appropriate forum for an action brought by a Canadian businessman against the newspaper Haaretz.

For lower courts that will have to apply the part of the test that deals with the forum non conveniens analysis, however, a decidedly mixed message was sent.

The ruling in Haaretz.com v. Goldhar included the main decision of three judges, three sets of concurring reasons and a dissent by the remaining three judges, including former chief justice Beverley McLachlin in one of the last cases she heard before her retirement.

The number of judgments issued by the court means that the “takeaway” on at least some of the issues is not as straightforward as usual when dealing with an online defamation case that could be heard in more than one jurisdiction.

Paul Schabas, lead counsel for Haaretz, says there is still some clarity in the main judgment, written by Justice Suzanne Cote.

“Whenever jurisdiction is established on a relatively weak or technical basis, the court is saying there should be a robust application of the forum non conveniens analysis. As a practical matter, the court has indicated that in these circumstances the burden [to rebut the presumption of jurisdiction] will be lessened,” says Schabas, a partner at Blake Cassels & Graydon LLP in Toronto.

Mitchell Goldhar, who owns SmartCentres in Ontario and has business interests in Israel, including one of its best-known professional soccer teams, initiated a legal action over an article that was published by Haaretz in November 2011. 

Goldhar lives part of each year in Israel and is very well known in that country.

The story was about his ownership of the soccer team, and the court heard that about 200 to 300 people in Canada downloaded it online. Haaretz is the oldest daily newspaper in Israel and had print circulation of 70,000 as well as its online presence when the article was published.

All of the Supreme Court judges agreed that there was a “presumptive connecting factor” so that an Ontario court could assume jurisdiction.

The differences focused on whether Haaretz was able to rebut this presumption of jurisdiction.

Justices Russell Brown and Malcolm Rowe concurred on the Cote judgment. She concluded that the evidence favoured Israel as the appropriate forum to hear the case and that the existing law was sufficient to resolve this issue.

She also agreed with the analysis of Justice Sarah Pepall, who dissented at the Court of Appeal and ruled in favour of Haaretz.

“As the rebuttal stage fails to address all the consequences of the ‘virtually automatic’ presumption of jurisdiction in defamation actions, it is appropriate for motion judges to be particularly attuned to concerns about fairness and efficiency at the forum non conveniens stage in these types of cases,” wrote Cote.

Cynthia Spry, a litigator at Babin Bessner Spry LLP in Toronto, says the Cote judgment is signalling what needs to be shown to be successful on the forum issue before a motion judge.

“Both sides will be trying to show there is unfairness” if the case is heard in a jurisdiction other than the one they are seeking, she says.

“If you can thread the principle of unfairness through all of the factors, that is the way to win,” Spry suggests.

What is unusual about the case, she notes, is the lack of consensus, which was one of the hallmarks of the Supreme Court during McLachlin’s tenure as chief justice. “Goldhar certainly appears to be a departure from her approach,” Spry says.

Justice Andromache Karakatsanis disagreed with Cote’s suggestion that a court could consider the law that would apply in another jurisdiction as part of its analysis. 

“This approach is inconsistent with this Court’s jurisprudence and risks lengthening the forum non conveniens analysis. It is also untethered from the rationale underlying the applicable law factor,” she wrote. However, she agreed with Cote that this was not a significant issue in this case.

Justice Rosalie Abella, in her concurring judgment, stated that the law should be modified to deciding where there is the most substantial harm to reputation, similar to what has been adopted in Australia.

“This new approach would displace the law of the place of publication of the defamation with the law of the place with the most significant connection to the tort,” Abella said.

Chief Justice Richard Wagner agreed with Abella that the most substantial harm test should be adopted in Canada.

“This new test for choice of law would have several positive effects,” he wrote.

“These positive effects include ensuring that the reasonable expectations of the publisher of the statement alleged to be defamatory are properly considered, striking a better balance between freedom of expression and harm to reputation concerns, and ensuring that choice of law will reflect the purpose of defamation laws,” stated Wagner.

The dissent by McLachlin and justices Michael Moldaver and Clement Gascon stated that the legal issue “boils down” to a single issue — whether a Canadian citizen allegedly defamed by a foreign publication that can be read online in his home province can bring an action in the courts in that province. The answer to this question is “yes,” the dissent concluded.

The judges also stated that the threshold of the “clearly more appropriate” test to rebut the presumption of jurisdiction should not be lowered.

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