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SLAPPs on the wrist

Real Estate
|Written By Kevin Marron
SLAPPs on the wrist

So far, only Quebec has introduced legislation to stop lawsuits from big companies that appear to pick on the little guys opposing their plans. Goliath didn’t have the option of suing David for malicious use of a slingshot, but today’s corporate giants can and sometimes do use the law as a blunt instrument to intimidate weaker foes.

That concerned the Quebec government to introduce a new law in 2009 to curb abusive civil proceedings, while the Uniform Law Conference of Canada is proposing a similar model act that could be applied in every province.

The Quebec legislation and ULCC proposals are designed to address the phenomenon that has acquired the emotive acronym SLAPP — strategic lawsuits against public participation. It refers to situations where a developer or corporation comes into conflict with citizens and launches apparently frivolous or abusive proceedings in the expectation citizens will not have the resources to defend themselves and may be intimidated enough to stop fighting for their cause.

Jack Aasen, a 62-year-old retired justice of the peace, has been called “the poster boy for anti-SLAPP legislation.” He and his wife Judy, with three other residents of their Vernon, B.C., subdivision, were sued by local developer Leonard Brad Chapman and his three corporations over allegedly slanderous statements made by the residents in connection with their concerns about the developer’s handling of sewer and water services.

What made this case “horrifying” and “unbelievable,” according to Aasen, was some of the allegations were based on a conversation secretly recorded in their own home by a private investigator posing as a prospective purchaser of a neighbouring property seeking their opinion of the developer.

Aasen says it was only because he represented himself that he and his wife avoided potentially ruinous legal fees for a case that ended up in the B.C. Court of Appeal. The appeal court ruled against the developer on several allegations, but did find that Aasen slandered the developer when he told the private detective that “he rides around on his horse and he kind of makes the suggestion that he’s got the mayor in his pocket.”

Aasen says he is waiting to see if the developer will pursue the matter further and is currently trying to get access under B.C.’s privacy legislation to the taped conversation with the private detective, which was never presented in court. He says he and his neighbours are now very wary of talking to strangers.

“The outcome of this case was shocking. It stunned the average citizen of British Columbia,” says lawyer Micheal Vonn, policy director of the B.C. Civil Liberties Association. She sees the case as “a clear demonstration of the need for some kind of mechanism to assist victims of SLAPPs or to have some kind of vetting process in place.”

B.C. had anti-SLAPP legislation for a few months in 2001. It was introduced by an NDP government that April and repealed by an incoming Liberal government that August. The reasons given for repealing the legislation were the same ones other provinces have subsequently cited in resisting calls for similar laws — a new law is not necessary because there are existing provisions that allow the courts to control abuse of process and dismiss frivolous lawsuits. Furthermore, the legislation was criticized as being too vague defining “abusive.”

Advocates of anti-SLAPP laws argue the courts are reluctant to use the powers they have to protect defendants from SLAPPs. That’s why the ULCC’s model act “proposes different measures to reinforce existing remedies, including sanctioning the conduct of a party, which should encourage the courts to intervene more often to deter abuse of the judicial process.”

In Ontario, calls for anti-SLAPP laws have recently been inspired by a case involving a marina and resort development proposed by Kimvar Enterprises Inc. at Big Bay Point on Lake Simcoe. It was opposed by local property owners and residents’ groups who soon found themselves embroiled in lawsuits.

The Ontario Municipal Board ruled in favour of the development, which was supported by the local municipality, but the developers were accused of using SLAPP tactics when they subsequently sought $3.2 million in costs. In deciding not to award costs, the OMB determined Kimvar’s claim for costs was not made for the improper intent of suppressing public participation but that a cost award against the residents could nevertheless have a “chilling effect.”

It highlights the need to put proponents and opponents of development on equal footing, says Ontario’s Environmental Commissioner Gord Miller, who is calling for laws that “could serve to halt SLAPP suits in their tracks” and “provide a means for the public to access financial and other resources in order to exercise their participatory rights in planning approvals and other contexts.”

But this could give citizens’ groups “a licence to slander,” says Jeffrey Davies, a partner at Davies Howe Partners in Toronto, who represented Kimvar at the OMB hearings. He maintains that slanderous statements often surface when citizens’ groups campaign against property developments. In most cases, he says, developers will “look the other way,” but “there are some highly egregious situations where action is taken.”

“We know how easy it is to manipulate the buzzword SLAPP, especially in an emotional setting like a hearing and how potentially damaging it can be to a proponent,” says Davies.

Quebec’s law attempts to balance the rights of all parties, says Jean-François Michaud, of Ogilvy Renault LLP. It reinforces the rules of procedure regarding abuse of process and also provides for new remedies, such as the ability to dismiss a portion of an action considered unfounded, without throwing the whole action out of court.

Costs can be claimed from the party found to be abusing the system and they can be paid in advance. Punitive damages can also be awarded after a process whereby the party complaining about abuse must convince the court that there is a prima facie case, after which the onus is reversed and it is up to the other party to convince the judge the proceedings are not abusive. “It’s a clear signal that the legislature is sending to the judicial system that it should be used for the essence of the dispute and not nourish the dispute by adding frivolous proceedings,” says Michaud.

So far, other provinces have chosen not to follow Quebec’s lead, so David will just have to hope that the courts will use their discretion to keep Goliath in check.

Reach freelance business journalist Kevin Marron at