2007 January 3

Regina School Division No. 4 v. Hall, 2007 SKCA 1323

The Saskatchewan Court of Appeal varied a lower court order striking a counterclaim against the plaintiff’s law firm as being frivolous and vexatious by permitting the individual defendant to counterclaim for alleged breach of fiduciary duty. The law firm had acted for the defendant in matters leading to his 1981 criminal code record (for which he was granted a full pardon in 1994) which became an issue when the plaintiff board caused a press release to be published in daily newspapers in Regina and Saskatoon announcing its legal action over “potentially libellous emails” which alleged that the school district, its schools and teachers are associated with an organization “directed and operated by an individual [the defendant] convicted of criminal offences.” The law firm conceded at the hearing of appeal that breach of fiduciary duty was properly pleaded by the defendant. “Since [the law firm] did act for the [individual defendant] in the criminal proceedings which played a prominent part in the subsequent proceedings it took on behalf of the Board against [the individual defendant], it cannot be said either that the pleadings in this respect disclosed no cause of action or that the pleadings were frivolous or vexatious. [The individual defendant] will, of course, have to prove at trial that the fiduciary duty of [the law firm] to [the individual defendant] continued to exist at the relevant time, notwithstanding that it had provided no services to [the individual defendant] for many years, that the members of the firm who acted for [the individual defendant in the criminal matters had left the firm many years before, and that the relevant files had been destroyed. While this may be difficult to prove or seem highly improbable, it cannot be said on the basis of the pleadings alone and the affidavits filed in support, that the claim is devoid of all merit of cannot possibly succeed. It is a matter for the trial judge to determine after hearing all relevant evidence. The Court of Appeal sustained the lower court’s decision to strike out the counterclaim for defamation relating to the allegation that the individual defendant had been convicted, noting that the pardon “cannot … change the historical fact that the convictions occurred and continued to exist for a period of time.” The Court of Appeal ordered that the counterclaim be stayed, however, until the original defamation action by the Board against the defendants over an email authored by the individual defendant and information on the defendant’s website is tried and determined.