Monday, August 22, 2011

This Week At The Ontario Court of Appeal: 11-08-19

Each week, Wise Law Blog reviews recent decisions from the Ontario Court of Appeal.

Toronto Star Newspapers v. Fraleigh. Mr. Fraleigh was involved in a divorce action against his wife while carrying on a relationship with a woman who worked for The Great-West Life Assurance Company. During the course of the divorce action, Ms. Fraleigh launched a claim against Great-West and Mr. Fraleigh's girlfriend, alleging that she had improperly adjusted Mr. Fraleigh's insurance claims while in a relationship with him. Mr. Fraleigh was not a party to the action, but sought a sealing order and publication ban over the action. The Toronto Star sought leave to intervene in the hopes that they could bring a successful motion to lift the ban and sealing order. Mr. Fraleigh also sought leave to intervene, to either prevent the Star's motion or to substitute it with one where the publication ban only concerned information regarding his personal health. The court granted both interventions, and the judge eventually lifted the original publication ban and sealing order, replacing it with a subtitute ban protecting Mr. Fraleigh's health information. The judge ordered that the Star pay approximately $93,000 in costs to Mr. Fraleigh as a result of this action. The Star appealed the costs award.

The Star appealed on three grounds. The Court of Appeal was not sympathetic to its first two grounds of appeal. They disagreed that the costs award was inconsistent with s.2(b) of the Charter of Rights and Freedoms, as the Star argued (on the grounds that costs awards for publication bans were a chill on media discourse), suggesting that the nature of the conflict between privacy rights of the individual and the public interest in the openness of the courts did not make a costs award on either side inappropriate in light of 2(b). The Court also felt that the motion judge did not err by awarding costs against an intervener, even though it went against the general principle that interveners in public interest litigation shoud not be subject to costs orders, primarily because the Court of Appeal characterized the Star as intervening not only on the basis of the public interest, but also their own interest (as they wished to publish the sealed/banned information), and therefore a costs award against an intervener in this instance was justified.

However, the Court did agree with the Star's third ground of appeal, which was that full indemnity costs were extreme in this instance. The Court noted that precedent states that elevated indemnity costs are only appropriate where either an offer to settle had previously been made to the costs-paying party and was not accepted (pursuant to the Rules of Civil Procedure) or where there was a finding of reprehensible conduct against the costs-paying party. In this case, the Court felt that the motion judge had improperly assigned reprehensible conduct to the Star, and that the Star pursuing a motion that was in its best interest was obviously not reprehensible. The Court also decided that the motion judge had improperly assigned the Star Mr. Fraleigh's costs for the entire publication ban period, and instead stated that only the period where the Star was actively litigating to contest the ban should be costs-awardable. Therefore, they reduced the costs award from the approximate $93,000 to $28,000. Read-the-whole-case rating: 2.

- Christopher Bird, Toronto
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