BETWEEN:

GEORGE FOULIDIS

- and -

ROBERT FORD

CITATION: Foulidis v. Ford, 2012 ONSC 7189 COURT FILE NO.: CV-10-411851

DATE: 20121227

ONTARIO

SUPERIOR COURT OF JUSTICE

j ) Brian Shiller and Angelrr Chnisson, for the ) plaintiff

Plaintiff ) 1 1 1 ) Gavin J. Tighe, Steven A. Thiele and Sarah ) Petersen, for the defendant

Defendant ) 1 ) HEARD: November 13, 14, 15, 16, 19 and ) 20,2012

J. MACDONALD J.

REASONS FOR JUDGMENT

[I] The plaintiff, George Foulidis, a businessman, sues for libel. The defendant, Robert Ford, was a municipal councillor and a candidate for the office of Mayor of the City of Toronto when he met with the editorial board of the Toronto Sun, a newspaper publisher, shortly before August 12, 2010. On August 12,2010 the Sun published an article in its newspaper which was based on Mr. Ford's statements to its editorial board. The plaintiff asserts but has not proven that the Sun also publisl~ed the article online. The plaintiff has sued the defendant in respect of statements attributed to him in the article. Tlie Sun has not been sued.

[2] When he spoke with the Sun's editorial board, the defendant was actively campaigning for election. He was elected Mayor approximately six weeks after the Sun article was published.

[3] Mr. Foulidis testified that he was and is the principal and sole shareholder of Tuggs Inc. which operated the Boardwalk Pub in the Beaches area of Toronto. There is an issue about the true nature of his relationship with Tuggs Inc., to which I will return. In 2007, after its initial lease expired, City Council awarded Tuggs Inc, a sole-source or untendered contract for the operation of the Boardwalk Pub and related concessions for 20 years. That decision and the untendered nature of the contract provoked considerable media attention and public colltroversy.

THE SUN ARTICLE

[4] The front page of the Sun newspaper on August 12,2010 featured a full-page photograph of Mr. Ford with a large superin~posed headline saying "COUNCIL CORRUPT". A smaller headline in the upper right corner directed the reader to the lead story with the words "Ford lashes out at Boardwalk decision PAGE 4". On the top half of page 4, two thirds was another picture of Mr. Ford with the large superimposed headline "FORD SMELLS "CORRUPTION"" and a superimposed quotation "I wish I could tell you stuff that happens behind closed doors". The right third was the article in issue, which consisted of two columns under the headline "Contract for Beaches eatery "stinks to high l~eaven"" written by Jonathan Jenkins. The article was 17 paragraphs long. The relevant paragraphs were as follows:

City council's decision to award an untendered, 20-year contract to Boardwalk Pub operator Tuggs Inc. smacks of civic corruptioti, Councillor Rob Ford says.

"If Tuggs isn't, then I don't know what is," Ford told the Torortto Slot 's editorial board. "1 can't accuse anyone or I can't pinpoint it, but why do we have to go in-camera on the Tuggs deal?"

"These in-camera meetings, there's more corruption and skullduggery going on in there than I've ever seen in my life."

Tuggs' owner George Foulidis did not respond to requests for comment *om the Stln.

Sandra Bussin, the local cou~~cillor who has defeuded Tuggs in t l ~ e past hilt recused herself *om the most recent votes on the contract in June, also declined to comment.

Bussill received more tl~an $12,000 %om Foillidis and people associated with him in campaign contributio~~s in 2003 and '06. City staff had recommended putting the food and drink concessioti at the eastern Beaches up for public tender after Tuggs' first contract expired but councillors opted instead to negotiate a sole-sourced deal with the firm.

"It's confidential and I wish you guys k~lew what happened in-camera," Ford said. "I wish I could tell you the stuff that happens behind closed doors".

He said the Tuggs deal "stinks to high heaven" and if he is elected mayor 011 Oct. 25 - he told the Siui he is now leading the race with 35% support, according to his campaign polls - he might try to break the contract.

MR. FORD'S STATEMENTS TO THE SUN

[ S ] Mr. Ford denies telling the Sun's editorial board that City Council's decision to award an untendered 20-year contract to Boardwalk Pub operator Tuggs Inc. smacks of civic corruption. There is a tape of what he said and counsel have agreed on a transcription of it. The parts of the transcript which relate to Tuggs Inc., its contract or deal with the City, the Boardwalk Pub and Mr. Foulidis were as follows:

Q: Rob, you ... I think I spoke with you yesterday, there are a number of things being rammed through at the next City Council meeting, um, you know, you know I've written about the Foulidis contract. There are a number of other things.. .leasing deals which I'll be writing about. All kinds of um, things. Um, first of all how do you feel about that and second of all, as Mayor, I mean is it possible for you to undo any of this stuff, after the fact? Rob Ford: Absolutely. Absolutely it is. Let me ask you one question, how did David Miller get elected? Q: On a bridge. On a bridge. Rob Ford: That's exactly how he got it. The $2 bridge that ended up costing millions. And so, he said that you can undo anything that's been done. :

Q: The Foulidis deal? Rob Ford: Wha.. . On the Tuggs? -.

Q: Yes. Rob Ford: Absolutely. It's in camera, obviously, its confidential, I wish that you guys knew what happened in camera, which a lot of you do, obviously, but these in camera meetings, there's more corruption and skullduggery going on in there than I've ever seen in my life. And.. .and if Tuggs isn't, I don't know what is. And I can't accuse anyone, or I can't pinpoint it, but why do we have to go in camera on a Tuggs deal? ... Rob Ford: So, I wish, I wish I could tell you the stuff that's happened behind closed doors. The things the media does not know. . . . Rob Ford: So a lot of these issues ... sorry Andy.. .A lot these issues don't have to go in camera. And if that Tuggs deal doesn't stink to high heaven I.. .I. ... Doug Ford: ... How about a 20 year untendered bid at a lower cost and then you find out the owner's contributing to the guys who are voting for him. ... Rob Ford: That's illegal. You call the police in to investigate that.

[6] These extracts from the transcript of the defendant's meeting with the Sun editorial board are less than one page of the thirty page transcript. In the rest of the interview, the defendant

spoke of his personal background, the lack of customer service at City Hall, spending, waste, the connection between sole-source contracts and waste, the nunlber of sole-source City contracts, his desire for competitive bids, transparency, in-camera meetings and his desire for accountability, downsizing City Council, opening the City for business, cleaning up graffiti, the City payroll, com~nunity housing, efficiency incentives for City workers, effective City managers and the progress of his election campaign.

[7] The defendant regarded his meeting with the Sun editorial board as an interview. He presumed that it was public and he expected that the Sun would write a story based on it. I find that he was speaking to the readership of the Toronto Sun newspaper as part of his election campaign. The Sun alone chose what to publish.

[8] The article in issue reports only part of what the defendant said to the Sun editorial board. I find that the defendant said what he is quoted as saying. He did not say the words reported in the first paragraph, which are not in quotation marks, that City Council's decision to award an untendered 20-year contract to Boardwalk Pub operator Tuggs Inc. smacks of civic corruption. However, that is an accurate paraphrase of, and an accurate account of the intended meaning and sense of words that the defendant did speak. In cross examination, the defendant admitted that when he said "if Tuggs isn't, then I don't know what is" he meant that if Tuggs isn't an example of corruption and skullduggery then he didn't know what was.

[9] I find that Mr. Ford spoke to the Sun editorial board because that would help to publicize him, his canlpaign and the issues on which he was running. By speaking to the Sun editorial board in these circumstances, I find that he implicitly authorized the Sun to publish what it did publish of and about his statements to its editorial board. See Douglas v. Tucker, [I9521 S.C.R. 275 at pp. 288-9; Ross v. Lciniporf [I9551 O.R. 542 at pp. 561-2 ( 0 . c . ~ ) ' . Mr. Ford is therefore regarded as having published his statements and the accurate paraphrasing thereof through the Sun newspaper to third parties. See Crookes et a1 v. Newton el al, 1201 11 3 S.C.R. 269 at para. 16.

THE NOTICE OF ACTION

[lo] The Notice of Action, referred to in this case as the Notice of Libel frames and limits an action for libel published in a newspaper. The plaintiff is limited to suing on the basis of the "matter colnplained of...", pursuant to the Libel and Slander Act, R.S.O. 1990 c. L-12, s. 5(1). Both the plaintiff and Tuggs Inc., carrying on business as the Boardwalk Pub were listed in the Notice of Libel as the intended plaintiffs.

1 It appears that the Court of Appeal ordered a new trial on other grounds. The Supreme Coutt of Canada set aside the order for a new trial of liability: [I9561 S.C.R. 366.

[I 11 The Notice of Libel complained of the following words contained in the article2, and stated also that the intended plaintiffs would rely on the entire article to provide context to the following words:

(1) City Council's decision to award an untendered, 20-year contract to Boardwalk Pub operator Tuggs Inc. smacks of civic corruption

(2) if Tuggs isn't, then I don't know what is

(3) it's confidential and I wish you guys knew what happened behind closed doors

(4) the Tuggs deal 'stinks to high heaven'

[I21 The Notice of Libel continued:

The Intended Plaintiffs state that the words complained of in their plain and ordinary meaning or by their innuendo meant or were understood to mean that the Intended Plaintiffs acted illegally and that the contract awarded to Tuggs Inc. was the result of that illegal and criminal activity. Further, the words complained of in their plain and ordinary meaning or by their innuendo were meant or were understood to mean that the Intended Plaintiffs are corrupt. The innuendo of the words complained of is that the Intended Plaintiffs bribed a member or members of City council. The words complained of are false and defamatory. The words complained of refer directly to the Intended Plaintiffs or are capable of referring to the Intended Plaintiffs. The words complained of were published recklessly and maliciously by you. ...

THE AMENDED STATEMENT OF CLAIM

[13] Tuggs Inc. did not sue. The plaintiffs amended Statement of Claim pleads the words mentioned in the Notice of Libel and states that they are defamatory of the plaintiff. In respect of the words in paragraph 1 of the Notice of Libel, the plaintiff pleads in paragraph 18.1 of the amended Statenlent of Claim that ". .. the statement is either the exact statement made by Mr. Ford or an accurate summary of the comments made by Mr. Ford to the Editorial Board and Mr. Jenkins. In the alternative, it is pleaded that the words "These in camera meetings, there's more corruption and skullduggery going on in there than I've ever seen in my life" that are a direct quote of Mr. Ford, have the same meaning as the words in paragraph 1 of the Notice of Libel. In paragraph 19, the plaintiff pleads that the words in issue ". . . in their plain and ordinary meaning

In the technical sense, this is a case of pt~blication to the Sun editorial board and of re-poblication by the Sun. However, the action was structured as the defendant publisl~ing tllrough the Sun.

or by their imluendo meant or were understood to mean that Mr. Foulidis acted illegally and that the contract awarded to his company was the result of that illegal and criminal activity". In paragraph 20, the plaintiff pleads that the words in issue ". . . in their plain and ordinary meaning or by their innuendo were meant or were understood to mean that Mr. Foulidis is corrupt", and that the innuendo is " ... that Mr. Foulidis bribed a member or members of City Council or througl~ some other unlawful means procured favour from City Council that resulted in tlte improper award of the contract." In paragraph 21, the plaintiff pleads that the words in issue are false, defamatory and capable of referring to him.

[14] In respect of his claim that the words in issue refer to him, the plaintiff does not plead in explicit terms that he relies on "extrinsic circumstances", namely information known to reasonable persons reading the article in issue and not mentioned in it. Nonetheless, reading the amended Statement of Claim as a whole, there is an implicit assertion of factors which amount to such extrinsic factors. The plaintiff pleads that Tuggs Inc. is Mr. Foulidis' corporation, Tuggs Inc. had a contract with the City entered into in 1986 pursuant to which the plaintiff built the Boardwalk Pub, the plaintiff established himself as an honest and reputable businessman, the plaintiff pursued a renewal of "his" contract with the City and he presented "his" business proposal and request to renew "his" lease to the City. I am satisfied that the plaintiff has pleaded that he was the principal of Tuggs Inc. and worked for and 011 behalf of it, not only in the Boardwalk Pub but in pursuing renewal of its lease with the City, deriving his reputation in part from that. This is, in turn, a sufficient pleading of the plaintiff's case at trial that he was seen by members of the public as the face of Tuggs Inc., as its alter ego, such that Mr. Ford's words about Tuggs Inc. or its deal would be seen as referring to him.

DID THE WORDS IN ISSUE REFER TO THE PLAINTIFF?

[15] One of Mr. Ford's defences is that the words in issue refer only to Tuggs Inc., which has not sued, and do not refer to Mr. Foulidis.

(161 The law has developed a two-part test which reflects the fact that, unlike this action, libel actions often have been tried with a jury. The first part of the test, an issue of law, is whether the words complained of are capable of referring to the plaintiff. The second part, an issue of fact, which a jury would decide only if the trial judge were to decide the first issue affirmatively, is whether the words in question would lead reasonable people to conclude that they did refer to the plaintiff: see Frciser v. Sykes [I9741 S.C.R. 526; Knupffer v. London Express Nelvsyciper Ltcl. [I9441 A.C. 116 at p. 121 (H..L.); Walker. el (11. v. CFTO Lid el ([I., (1987) 59 O.R. (2d) 104 (C.A.).

[17] I am satisfied that the words in issue are capable in law of referring to the plaintiff. The words are capable of having been spoken of and concerning him, in conjunctio~~ with Tuggs Inc., because they impute conduct to Tuggs Inc., an inanimate entity, which may only take place through a human agency. Since there is some evidence which, if believed, would establish that Mr. Foulidis was the only person with control of Tuggs Inc., its alter ego, the words in issue are capable in law of referring to him. See Anrgzistine Autonlafic Rotary Engine Co. v. Sc~t~~rdc~jj ~Vighf Lintited (1917), 38 O.L.R. 609 (C.A.); O~clen Sound Building & Saving Society a illeir

(1893), 25 O.R. 109 (C.A.); Don~bey I? Phoenix Ne1i1spspayel.s Inc., 150 Ariz 476 (1986) (Ariz. S.C.). Each case, of course, depends on its own facts.

[18] As the above description of the second part of the test states, it is determined from the vantage point of the reasonable person reading the words in issue. It is a common sense test, which presumes that the words in issue will be read reasonably, in context, and understood in accordance with their usual and ordinary meaning. The primary context in this case is the article itself. Reasonable persons would consider the wllole of the article, so that both the words therein and the ideas expressed may be considered in the light of the whole. The context here also includes that Mr. Fold was speaking as a sitting councillor with knowledge of City Council and its processes and also as a nlayoralty candidate campaigning for election. Mr. Ford's dual status as a councillor and as a mayoralty candidate in the upcoming election were mentioned in the article and were also well known.

[19] Reasonable persons generally would consider the whole of an article in order to form any conclusions. Reasonable persons reading the article in issue and tlie page 4 headline would have been struck by the use of the work "corruption". It is a serious issue when spoken about governmental processes by a member of the government in issue. It would have been an alarnling word in the circumstances, and reasonable persons reading it would have scrutinized the article to see whetl~er there was any substance to it. They would have looked to see whether there was any basis in fact put forward for the assertion of corruption, whether any such basis in fact supported t l ~ e assertion of corruption, and whether the person asserting corruption expressed any limitations or disclaimers which limited, modified or clarified the inherent seriousness of the assertion of corruption. Reasonable persons would have read this article in this way so they could decide for themselves what to make of Mr. Ford's corruption assertion. When I speak of the reasonable person or the reasonable reader in the rest of these reasons, I speak of them acting in the way I have described.

[20] Mr. Ford was asked by a Sun representative about Mr. Foulidis. Mr. Ford responded by asking whether the question was about "Tuggs". He spoke only about "Tuggs" and the "Tuggs deal". Nothing which he said to the Sun editorial board, and nothing of what he said which is quoted or parapl~rased in the article mentioned Mr. Foulidis. The reference to "Tuggs' owner George Foulidis" in the article was, and clearly would have been seen by the reasonable person reading it as a statement made by tlie Sun, not by Mr. Ford. This paragraph of the article stated that the Sun had requested comment from "Tuggs' owner George Foulidis", which obviously was in respect of Mr. Ford's assertions. It was the Sun which linked George Foulidis' name to Mr. Ford's statements, not Mr. Ford, as the reasonable reader would have known from what the Sun said. I accept Mr. Ford's evidence that he barely recognized Mr. Foulidis' name when asked about "the Foulidis deal" by the Sun, and that he did not know him personally. I find that Mr. Ford did not authorize the Sun to add its linkage of tlie name "George Foulidis" to any publication of what he had said. That is because Mr. Ford was explicit in telling the Sun that he could not accuse anyone.

[21] The issue for determination is whether the words complained of as libellous referred to the plaintiff, when considered from the vantage point of the reasonable reader. It is not whether Mr. Ford intended to refer to the plaintiff. It also is not whether the article mentioned the

plaintiff because the reference to Mr. Foulidis therein was made by the Sun without Mr. Ford's knowledge or authorization, not by Mr. Ford. While the whole of the article was properly context which the reasonable reader would have considered, so too were the clear indications in it that first, Mr. Ford did not identify Mr. Foulidis as Tugg Inc.'s owner or otherwise speak of him personally and second, that only the Sun did that.

[22] Taking into account the burden of proof resting on the plaintiff and the standard of proof in civil actions, namely the balance of probability, the issue for determination becomes this: has the plaintiff proven that, when Mr. Ford spoke or was paraphrased in the article as speaking of Tuggs Inc. or of Tuggs, or about the Tuggs deal, it is probable that the reasonable person would have understood that as a reference to the plaintiff, as well as a reference to Tuggs Inc, or Tuggs?

[23] The first aspect of this issue which I wish to address is the relationship between the plaintiff and Tuggs Inc., the work which he did on behalf of Tuggs Inc. and how the reasonable person would have regarded that.

[24] Tuggs Inc. is a corporation. It is properly regarded as a legal entity which is separate and distinct from the person or persons who incorporated it, who own its shares, or who are its officers, directors, employees or agents. Reasonable people know this and know also that a corporation, being an inanimate entity, can act only through a person or persons. They know that if a corporation is corrupt, or makes a col.l.upt deal, it is because the person or persons who operate it or act for it engage in that conduct on the corporation's behalf.

[25] The evidence, which raises several issues, falls into three general categories:

1. a Corporation Profile Report from the Ministry of Government Services in respect of Tuggs Inc.

2. Mr. Foulidis' testimony about his comlection to Tuggs Inc., and

3. other evidence about Mr. Foulidis' connection to Tuggs Inc.

[26] The Corporation Profile Report states that it records the 1110st recent information filed by the corporation. The Report was provided by the Ministry of Government Services on September 30, 201 1 and states that the last document recorded is the corporation's annual return under the Corporations Inforrt2ation Act, R.S.O. 1990 c. C-39, which was dated January 24, 2009. The Report states that Konstantinos Foulidis has been the president, secretary and director of Tuggs Inc. since December 1993. He is the plaintiff's brother. The Report makes no lilention of the plaintiff. No other records of Tuggs Inc, are in evidence. I find that Tuggs Inc. advised the Ministry in its annual return under the Corporations Information Act dated January 24, 2009 that Konstantinos Foulidis was its president, secretary and director and thereby also stated, inferentially, that George Foulidis was not its officer or director. Further, I find that, up to September 30,201 1 Tuggs Inc, left this information standing in the Ministry records, knowing of its obligation under the Corporations Inforrm~ution Act, s. 3.1(1) to file an annual return setting out in part who its officers and directors were. Consequently, Tuggs Inc.'s representation to the Ministry was that the plaintiff was not its officer or director at the relevant time.

[27] Mr. Foulidis was cross examined about the Report. He testified that it likely was in error. He testified that he was and is Tuggs' sole-shareholder, that the Ministry sends letters addressed to him as the president of Tuggs, that the Ministry "has me as president" and that he had in court documentation fsolll the Ministry which states that he is the director and administrator of the company. No such records were put in evidence.

[28] Mr. Foulidis' participated in a fraud, namely a fraudulent conveyance which was to assist his mother in defeating the claims of a judgment creditor. When testifying, he denied his participation in the fraud. He eventually admitted it, reluctantly, after reasons for judgment of this court and further reasons for judgment of the Court of Appeal upholding the decision of this court were put to him. The trial judgment found that he was the person primarily responsible for moving the assets in issue and the appeal judgment upheld this finding.

1291 I find that the plaintiff attempted to mislead this court about his past fraudulent conduct. Having considered this in the context of the whole of the evidence, I am left with serious doubt about the credibility and reliability of his testimony, particularly where it is in conflict with other credible evidence, but also where it is not confirmed or supported by other evidence.

[30] 1 reject as incredible the plaintiffs testimony that he was, at any relevant time, an officer, director or shareholder of Tuggs Inc. There is only his testimony in support of these contentions and I find as a fact that he has failed to prove these connections to Tuggs Inc.

[31] Mr. Foulidis also testified that he was heavily involved in running Tuggs Inc.'s restaurant, the Boardwalk Pub, from 1986 to the present, and that he was the only person who, on Tuggs Inc.'s behalf, dealt with the City in seeking to extend its lease which expired in 2006. No other witnesses testified about these connections with Tuggs Inc., its business and its lease negotiations wit11 the City. However, there are numerous references in the doculnents put into evidence about Mr. Foulidis' involveinent wit11 the Boardwalk Pub and involvenlent on Tuggs Inc.'s behalf in the lengthy efforts to negotiate a new lease with the City. On the whole of the evidence I find that the plaintiff has had considerable involvement in running the Boardwalk Pub and as a result, he was and is seen by its clientele as a person involved in running Tuggs Inc.'s business venture. In addition, I find that Mr. Foulidis also had considerable involvement with the City, on behalf of Tuggs Inc. in its lengthy efforts to negotiate a new lease. Those efforts, as confirmed by City documents in evidence, spanned the years from approximately 2005 to 2010. As a result of that, the plaintiff also was and is seen as a person involved in Tuggs Inc.'s business.

[32] In addition, the substantial controversy which arose after City Council decided in 2007 to award Tuggs Inc, a new 20 year lease without calling for public tenders has resulted in soine public understanding that the plaintiff was and is a person involved in Tuggs Inc.'s business.

[33] My findings are that Mr. Foulidis has proven on the balance of probability that, at the relevant times, he was, and was seen to be a person who acted on behalf of Tuggs Inc. as aforesaid. He has not proven that he was, or was seen as the only person. I bear in mind what Tuggs Inc.'s annual return states and what I have found in this regard. Mr. Foulidis has failed to prove his assertion that he is either the face of Tuggs, or its alter ego. On the evidence, I find

that he has failed to prove that he was the person, and was seen as the person with management control of Tuggs Inc.

[34] I return to the question of wl~etller the reasonable person probably would have concluded that the words complained of refer to the plaintiff. As stated, the reasonable person knows that a corporation acts through a person or persons, and also that a statement that a corporation, or its deal is corrupt is a statement that one or more persons acted corruptly on its behalf. Despite this, there are two compelling reasons in this case why the reasonable person reading the words in issue about Tuggs Inc., Tuggs or the Tuggs deal would have concluded that they do not refer to the plaintiff.

[35] The first reason is that the plaintiff was known only as a person involved with Tuggs, not as the person who was its sole actor or even its primary actor.

1361 The second reason is that the defendant was quoted in the article as saying "I can't accuse anyone.. .". That would have led the reasonable person reading the article to conclude that the defendant could not, and therefore was not blaming or charging any person with fault. That included any person who had acted for or on behalf of Tuggs Inc., of whom the plaintiff was known to be one. This conclusion about how the reasonable person would have regarded the defendant's explicit assertion that he couldn't accuse any person is fortified by the following analysis. Looking at the article as a whole, the defendant stated only that he sensed or suspected the presence of corruption. He was paraphrased correctly as stating that City Council's decision to award the contract to Tuggs Inc. "smacks of ' civic corruption. He said that the deal "stinks". This latter graphic description was paraplrased accurately by the Sun in the page 4 headline that he "smells" corruption. Having stated clearly that he only sensed or suspected the presence of corruption, the defendant then stated in addition "I can't pinpoint it.. .". Tlle words "I can't.. ." in this phrase would have been understood reasonably as the defendant admitting his inability to point to any facts which demonstrated what he sensed. To the reasonable reader, the fact that the defendant only sensed or suspected the presence of corruption and admitted that he had no facts to support that sense would have made his statement "I can't accuse anyone ..." particularly conclusive. That is because the words "I can't ..." in this phrase also would have been understood reasonably as meaning "I am not able to.. .". I recognize that the word 'or' was used in the plrase "I can't accuse anyone or I can't pinpoint it...". In my opinion, the reasonable reader probably would not have understood the 'or' to mean that the defendant had corrected l~imself by substituting the second part of the phrase for the first part. I think it is much likely that the reasonable reader would have understood the defendant to have said that he couldn't do either; he couldn't either accuse or pinpoint. Nonetheless, these words, spoken together in one plrase, would reasonably have been understood as related. Both parts of the plrase were strong, limiting expressions. Functionally, they are closely related concepts. I conclude that the defendant's inability to accuse anyone of having acted corruptly meant, to the reasonable reader, that the defendant didn't have facts which supported his sense or suspicion of corruption. As well, the defendant's inability to point to facts which established corri~pt conduct meant that the defendant could not accuse anyone. Consequently, the 'or' in the phrase, read reasonably, does not negate the understanding that the two concepts mentioned in the plrase were inter-related limiting concepts, even though expressed as alternatives. Read reasonably, they were alternative expressions of the same thing. The defendant stated that he was unable to accuse anyone of

anything. In my view, the words in issue could not have been taken as saying what the defendant explicitly disavowed. The words in issue, read reasonably and in context, do not refer to George Foulidis because they do not refer to any person.

ARE THE WORDS IN ISSUE DEFAMATORY?

[37] The issue is whether the words are defamatory of the plaintiff. To decide this issue, I must assume for the sake of analysis that the words were spoken about the plaintiff, despite my conclusion to the contrary. Mr. Peter Downard states in "Libel", 2 ed. Markhain, Ont.: LexisNexis Inc., 2010 in s. 3.01 that:

"(t)he classic statement of the law is that words are defamatory if they tend to cause the plaintiff to be regarded by reasonable persons with hatred, contempt, fear or ~idicule.~ Words are also defamatory if they impute improper and disreputable conduct, even though an ordinary person might not regard that conduct with hatred, contempt, fear or ridicule.

[38] The reasonable person, having read fairly all of the defendant's assertions in the article in issue, both quoted statements and accurate paraphrasing, likely would have understood him to have said:

(1) I sense or suspect corruption in Tuggs Inc.'s deal with the City

(2) However, I'm unable to say that anyone did anything wrong

(3) My sense or suspicion of corruption is based on the Tuggs deal having been considered by the City "in camera"

(4) In camera meetings are where more corruption and skullduggery goes on than I've ever seen

(5) However, I don't know what actually took place.

1391 Point 2 is, in my view, what the reasonable person would have understood from the defendant's statement "I can't accuse anyone .. .", read in context. Point 5, I conclude, is what the reasoilable person would have understood from the defendant's statement " ... I can't pinpoint it . . .", see11 in the light of the rest of the reported statements that the defendant nlerely sensed or suspected corruption but "can't" accuse anyone of it. Again, the words "I can't ..." would have been reasonably understood as meaning "I am not able to . . .", a confession of the defendant's inability to say that anyone did anything wrong. The words in issue are reasonably

Botilrk v. Torortfo Free Press Publicafioris Lfd. [I9951 3 S.C.R. at para. 62 (S.C.C.)

read as precluding the inference that the defendant knew of facts which proved corruption but he was unwilling to speak of them.

[do] As a matter of law, a statenlent of suspicion may impute guilt and therefore be libellous, but it does not necessarily do so: see Lewis 17. Daily Telegraph Ltd., [I9641 A.C. 234 (H.L.) at p. 285. The issue is resolved by determining the meaning which the particular words in issue, taken in context, conveyed to the reasonable person. As Lord Devlin explained in Lelvis (supra) at p. 285 "(1)oose talk about suspicion can very easily convey the ilnpression that it is a suspicion which is well founded.. .", thereby becoming a defamatory imputation of guilt.

[41] In TPG Technology Consttlting Ltd 11. Poic~ell, 2012 ONCA 87, the Court of Appeal cited with approval at paragraph 11 the statements that first, a report that someone is under investigation or that they have been arrested for, or charged with a criminal offence is not considered "the equivalent of saying that the person has committed the crime unless there is something in the language of the report that suggests the plaintifrs guilt" and second, that reports of arrest or charges will be capable of conveying a defanlatory meaning "where it is stated, either directly or by clear implication, that an offence has been committed, and the qualifications contained in any of the surrounding statements are not sufficient to outweigh or nullify the effect of what appears to be a plain statement of fact". The authority cited for the first statement is Raymond E. Brown, Broic~n of Defaniation, Loose-leaf, (Toronto: Carswell, 201 l), Ch. 4 at pp. 4-165 to 4-166; and Roger D. McConchie and David A. Potts, Canadian Libel and Slrtnder Actions, (Toronto: Irwin Law Inc., 2004) at p. 516. The authority cited for the second statenlent is Shave v. West Azrstralian Neivspapers Ltd., [2000] W.A.S.C. 172 (S.C.) at para. 29.

[42] In the case at bar, the defendant spoke of much less than arrest or charges. He spoke of his sense or suspicion while stating that he was unable to accuse anyone.

[43] English decisions speak of "bane and antidote" circumstances, where a statement contains a defamatory part (the "bane") and also a part which neutralizes it (the "antidote"). English case law holds that it is only in the clearest of cases that the antidote remedies the offence. Canadian case law appears not to have adopted this requirement. This is not part of the ratio of Shave 11. JVest Australian Neic~spnpers Ltd. (s~rpra) which was cited with approval by the Court of Appeal in TPG Technology Conszrlting Ltd. it Polrrell (suprcr). In addition, in P.G Restazrrnnt 11. Northern Interior Regional Health Bourd (2005), 30 C.C.L.T. (3d) 55 (B.C.C.A.), Saunders J.A. held that part of a published article contained a defamatory sting which was neutralized by another pa t . He did not hold that such neutralization could only take place in the clearest of cases. He concluded for the coult that the article, read as a whole, was not defamatory. Leave to appeal to the Supreme Coult of Canada was refused: [2005] S.C.C.A No. 270.

[44] In nly opinion, the reasonable reader would have concluded that the statements in issue, read as whole and understood as aforesaid, did not defame the plaintiff, even if it is ass~uned that the statements were about him. This is not a case of a defamatory assertion and another assertion to the contrary which leave the reasonable reader to choose between them, in deciding what meaning the words convey. The words in issue leave no doubt about their meaning, when read reasonably and in their context. The defendant voiced only a suspicion of corruption which he,

immediately and in clear terms, admitted was without factual foundation or insufficient for him to be able to say that anyone had done anything wrong. In my opinion, he clearly and explicitly prevented any defamatory meaning being perceived in his suspicion of corruption.

CONCLUSIONS

[45] The plaintiff must prove four things on the balance of probability to prove a libel in this case:

(1) That the defendant spoke the words in issue.

(2) That the defendant published the words in issue to one or more third parties.

(3) That the words in issue referred to the plaintiff.

(4) That the words in issue were defamatory of the plaintiff.

The plaintiff has proven the first two and has not proven the second two. His action fails on this basis and must therefore be dismissed.

[46] The defences advanced by the defendant are that he spoke the words on an occasion of qualified privilege, that the words he spoke were "fair comment" and that his words were "responsible co~nmunication on a matter of public interest". Evidence also was adduced from the defendant about his motives in speaking, and whether he honestly sensed or suspected that corruption was involved in Tuggs Inc.'s contract with the City. This latter evidence, adduced from the defendant by the plaintiff, was part of the plaintiffs effort to prove what is called "express malice" in libel law, which is capable of defeating defences proven by the defendant.

1471 In my view, having found that the plaintiff has failed to prove his case, there is no good reason why I should make findings of fact or express conclusio~ls about either the defences raised, or the issue of express malice. Trial judges may, and often do make contingent findings of fact when that serves the ends of justice. For example, if the Court of Appeal were to reverse a trial judge's determination of a threshold issue of law, then the trial judge's contingent findings of fact could be used by the Court of Appeal to resolve the case. In the absence of such contingent findings by the trial judge, the Court of Appeal would have to order a new trial. In this case, I conclude that contingent findings of fact about Mr. Ford's defences and Mr. Foulidis' express malice claim will be of no assistance if the Court of Appeal were to find that I have erred in my conclusions that the plaintiff has failed to prove two essential aspects of his case. That is because my conclusion that the words in issue do not refer to the plaintiff rests on facts as found by me, based on credibility findings. My conclusion that the words in issue are not defamatory of the plaintiff also rests on my assessment of the evidence. If I have erred in these conclusions, I believe it is virtually certain that a new trial will be ordered.

[48] On the other hand, if the Court of Appeal were to uphold one or both of nly determinations that the plaintiff has failed to prove two essential aspects of his case, then that Court would have no need for my contingent findings of fact relating to Mr. Ford's defences and Mr. Foulidis' express malice claim.

[49] I therefore exercise my discretion to refrain from expressing either findings of fact or other conclusions in respect of Mr. Ford's defences and Mr. Foulidis' express malice claim.

[50] I will assess the plaintiffs general damages as if he had been successful. However, I will refrain from attempting to assess his claims for aggravated and punitive damages. These assessments would be hypothetical and speculative in the absence of findings of the type that I have described as part of Mr. Foulidis' express malice claim.

GENERAL DAMAGES

[51] If Mr. Foulidis had been successful in proving that he was libelled by the words in issue, he would not need to prove actual loss. General damages are presumed from the publication of a libel: see Mzrryly 11. Alexander (2004) 236 D.L.R. (4th) 302 at 31 1 (O.C.A.),

[52] General damages are compensatory damages which, in a libel action, are awarded primarily to compensate for tlie harm caused to the plaintiff's reputation by the defamatory publication. Intangible or subjective elements are properly considered, as are the plaintiff's wounded feelings: see Walker et al. I? CFTO Ltd. et al. (1987) 59 O.R. (2d) 104 (C.A.) at p. 11 1.

[53] Since general damages in a libel case do not require proof in tlie assumed circumstances, the courts have developed a number of criteria to assist in assessing them. Peter A. Downard provides a useful list in "Libel", op. cit. at para. 14.01.

[54] The evidence of the plaintiff's participation in a fraud is relevant to his reputation as of the date of publication of the words in issue. The reasons of this court finding that he had participated in a fraud were released on May 3, 2004 and the reasons of the Court of Appeal upholding those findings were released on July 6, 2005. I reject as incredible the plaintiffs evidence that no one knew of this.

[55] The plaintiff testified about his injured feelings, including about a question his young daughter asked him which was apparently based on the defendant's statements about Tuggs Inc. and which caused the plaintiff some difficulty. I am not persuaded to infer any connection between the defendant's words in issue and the plaintiffs assertion that his daughter asked hi111 a troubling question.

[56] One of the criteria for assessing general damages mentioned by Mr. Downard (sttpra) is the stature of the defendant, on the theory that the greater the defendant's stature, the greater the impact of the defamatory statement. Mr. Ford's dual status as a councillor and as a mayoralty candidate is clear, as is the fact that he won the election. It is also clear that he did so with less than 50% of the vote. However, the words in issue include "I can't accuse anyolie or I can't pinpoint it.. .". Viewed reasonably, the words in issue were so neutral in respect of the plaintiff that they probably had little impact on the plaintiff. If I were to assume, as part of the attempt to provide a contingent general damages assessment, that the words quoted above were not spoken, I would be assessing a very different case.

[57] For this reason, even assuming that the words in issue were spoken about the plaintiff and were defamatory, the negligible taint of the words in issue means that the degree of damage to Mr. Foulidis probably was negligible.

[58] I accept that Mr. Foulidis' reputation is an aspect of the business success he has apparently enjoyed. However, it is difficult in this case, given my findings about his involven~ent in Tuggs Inc., to know what his business really was at the relevant time and thus, to consider how reputational issues affected him personally as a businessman. Tuggs Inc, is not a plaintiff. 1 will make a modest allowance for this element of his general damages.

1591 There is also the issue of the plaintiff's libel action against Mr. Bruce Baker for words published in May 2010. That action was tried together with this action. The words in issue therein were spoken about the plaintiff and were defamatory, leaving aside Mr. Baker's defences and the issue of express malice, and thus probably damaged the plaintiff in some measure, shortly before the defendant spoke the words in issue in this action. This is a factor to be taken into account in this assessment.

[60] Looking at the various factors, I conclude that the plaintiff's general damages are properly assessed at $20,000, on the aforesaid assumptions.

ORDER

[61] The action is dismissed. If the parties are unable to resolve costs, the defendant's written costs submissions limited to seven pages in Factum format plus all necessary docket and disbursement information shall be delivered within 30 days of the release of these reasons. The plaintiffs written costs subn~issions, similarly limited, shall be delivered within 60 days of the release of these reasons.

Released: December 27,2012

CITATION: Foulidis v. Ford, 2012 ONSC 7189 COURT FILE NO.: CV-10-411851

DATE: 20121227

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

GEORGE FOULIDIS

Plaintiff

- and -

ROBERT FORD

Defendant

REASONS FOR JUDGMENT

J. Macdonald J.

Released: Deceniber 27,2012