When companies are targeted by malicious or libelous statements, a common question is "can a company sue for defamation?" Do Canadian laws allow corporations to sue to protect their reputation?
This article will discuss the basics and legal considerations if a company can sue for defamation in Canada. For more details on libel and defamation, companies can also reach out to a Lexpert-ranked defamation lawyer.
Can a company sue for defamation?
Yes. Companies can sue for defamation under Canadian laws. Common law has established that a corporation, organization, or company can file a defamation case in court. On the flipside, this also means that they can also be sued for defamation.
However, there are certain differences between a person and a company when suing for defamation. Common law says that because a company does not have personal feelings, the injury is typically shown through financial or reputational loss.
Because of the ruling that corporations do not have feelings, courts typically limit moral or non‑pecuniary damages for corporations; other damages may be available based on proven loss.
How do defamation cases work under Canadian laws?
First, it's important to clarify some terms that are commonly interchanged:
- libel means defamation through written or printed material
- slander is spoken defamation or defamation done verbally
- libel and slander are forms of defamation; provinces often distinguish between them in statutes, but the core principles are similar
Before a company can sue for defamation, it must first determine whether the alleged statement or publication is defamatory under Canadian law. The legal bases of defamation in Canada are found in the following:
- Criminal Code
- provincial laws
- Québec's Civil Code
- common law
While the Charter of Rights and Freedoms protects freedom of speech and freedom of the press, the exercise of these freedoms must be done legally and in good faith. Courts balance Charter protections for expression and press with defamation law, recognizing limits where reputational harm is proven.
We'll discuss the laws governing defamation below:
Defamation under the Criminal Code
Section 298 of the Criminal Code provides for the crime of defamatory libel, which is the act of publishing any matter or material that:
- will likely injure a person, by exposing them to hatred, contempt, or ridicule
- is designed to insult a person
Under the same Section, defamatory libel may be either:
- through direct damaging statements
- implied, through insinuations or ironies
Provincial defamation laws
A person or a company can sue for defamation in Canada based on provincial laws for libel, slander, and defamation. Under these laws, civil liabilities such as damages may be imposed on the defendant if found guilty of committing defamation.
Here are some provinces with their own laws on libel, slander, and defamation:
- Alberta: Defamation Act
- British Columbia: Libel and Slander Act
- Manitoba: The Defamation Act
- Ontario: Libel and Slander Act
Anti-SLAPP laws
In addition, British Columbia and Ontario also have their own anti-SLAPP (strategic lawsuit against public participation) laws. Both are called the Protection of Public Participation Act.
These laws allow the early dismissal of defamation claims filed in court, but only if the defendant can prove that the alleged defamatory statement is a matter of public interest. On the other hand, the case will proceed if the plaintiff can show that their case has legal merit or that the defendant has no valid defence.
These anti-SLAPP laws are relevant for corporations suing for defamation, as their court cases may be prematurely dismissed. This is why it is important to talk to a defamation lawyer, who can help in the early evaluation of the corporation's case.
Québec's Civil Code provision on defamation
Since Québec is not a common law province, defamation is governed by its Civil Code. While the Code does not have a specific provision on defamation, libel, or slander, the Code's Article 1457 applies when a person or a company sues for defamation.
Under this Article, a person must not cause injury to another. Otherwise, they will be liable for damages and reparations, whether physical, psychological, or material in nature.
Watch this video to learn more about what you need to prove when suing for defamation in Québec:
Determined to file a defamation case? Hire one of the best defamation lawyers for media litigation in Canada as ranked by Lexpert.
Common law on defamation
Canada's common law also governs when a person or a company sues for defamation. Certain case law impacts:
- how defamation cases are litigated
- what defences may be set up by the defendants
- the elements of defamation the plaintiffs must prove
Below are some of the prevailing cases and their legal principles when suing for defamation:
- Grant v. Torstar Corp., [2009] 3 SCR 640: established the defence of "responsible communication" for journalists and other defences against defamation, such as justification, fair comment, and qualified or absolute privilege
- WIC Radio Ltd. v. Simpson, [2008] 2 SCR 420: clarified the fair comment defence in defamation cases by establishing its requisites and the test that the defendant must prove to invoke this defence
- Crookes v. Newton, [2011] 3 SCR 269: publishing a hyperlink is not "publishing" a defamatory material per se, unless a defamatory statement is found in the text of the Uniform Resource Locator (URL)
- Breeden v. Black, [2012] 1 SCR 666: Canadian courts have jurisdiction over a defamation case even if it was published outside the country, if the defamatory statements are read, downloaded, or republished within Canada
- Hill v. Church of Scientology of Toronto, [1995] 2 SCR 1130: stated that the plaintiff does not have to prove the defendant's malicious intent when suing for defamation
This video discusses the defences against defamation in the case of Hill v. Church of Scientology of Toronto:
Whether you're a plaintiff or a defendant in a potential defamation case, you can consult the Lexpert-ranked best defamation law firms for media litigation in Canada.
How can you prove defamation in Canada?
Before anyone can sue for defamation in Canada, the existence of defamation would have to be established through these elements:
- the published material is defamatory
- the published defamatory material refers to the plaintiff
- the defamatory material was published for the public or other people aside from the plaintiff
This is because plaintiffs have the burden to prove their allegations of defamation in court.
Standard on what is defamation
Common law says that a published material will be considered "defamatory" based on the standards of a "reasonable man" or a "right-minded person." As such, it is defamatory if the statements attack the company's reputation, integrity, or competence based on these standards.
Here are other legal considerations on the defamatory material when a company sues for defamation:
- the company must be identified in the material: the defamatory material must also refer to the company, whether expressly or impliedly
- the material must be published: the defamatory material must be published publicly or in any other mass media (e.g., the internet, newspaper, or magazine)
What are the penalties for defamation in Canada?
Penalties for defamation can be criminal and civil in nature. While civil tort cases for defamation are more common, companies should consult with a defamation lawyer to know what case would be appropriate for their situation.
Criminal penalties for defamation
Under the Criminal Code, defamation is penalized according to the specific crime committed:
- publication of libel (section 300): when the person knows that the information is false, the penalty is either:
- imprisonment of not more than five years
- a penalty for offences that are punishable on summary conviction
- publication of all defamatory libel (section 301): imposes a penalty of either:
- imprisonment of not more than two years
- a penalty for offences that are punishable on summary conviction
Civil penalties for defamation
Common law provides the civil liabilities for defamation, which may be one or a combination of the following:
- general damages: to compensate for the plaintiff's injured reputation
- special damages: out-of-pocket expenses, such as business losses and expenses
- punitive damages: to penalize defendants for their defamatory acts
- aggravated damages: when the defamatory acts are highly oppressive
- permanent injunction: to permanently prohibit the publishing of defamatory statements
The specific damages you would be asking the court is easily calculated with the help of your defamation lawyer. This would depend on the extent of injury your company has suffered and the gravity of the defamatory statements.
How can lawyers help companies sue for defamation?
Whether your company is the one suing for defamation or is being sued for defamation, lawyers have your back by assisting you in several ways:
- for plaintiffs: with the help of your lawyer, you can legally respond to defamatory statements against you or your company through several legal means (e.g., notice of libel or filing a case in court)
- for defendants: lawyers can help you respond to libel or defamation claims by the plaintiff, not just when a case is already filed in court, but even as early as when the plaintiff sends you a notice of libel
Corporations should seek timely legal advice to assess the claim, potential defences, mitigation steps, and strategic options.
Company suing for defamation: Legally protecting its reputation
When a company's name is at stake, Canadian laws allow it to sue for defamation, aside from other legal remedies. To be sure, it's important to first engage in the services of a defamation lawyer, not only to understand how defamation cases work, but also to know how these cases can affect the company's publicity and reputation.
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