McNeil v. Brewers Retail Inc., 2008 ONCA 405, released yesterday is a remarkable decision upholding a huge award for malicious prosecution.
Legally a significant issue was the clarification of the requirement that a prosecution be initiated by the defendant for there to be a claim for malicious prosecution.
The facts are fairly straightforward. A former employee of Brewers Retail Inc. (“BRI”), Douglas McNeil, was accused of stealing about $140 from the cash register. A subsequent investigation by McNeil's union showed BRI withheld evidence that proved his innocence, and McNeil's theft convictions were quashed in 1997.
Douglas McNeil was fired in 1994 from a Niagara Falls-area franchise after being convicted of theft.
At trial two years ago, court heard that, while BRI - known publicly as The Beer Store - gave police video evidence showing McNeil taking money from the cash register, footage of him returning the cash was not shown at any point during court proceedings.
The court heard that on two occasions when McNeil removed cash from the till, his transaction was balanced by returning funds. Yesterday’s decision noted:
"By its verdict, it is apparent that the jury viewed BRI as a calculating and insensitive company that was prepared, for its own purposes, to see an innocent man convicted of a crime he knew he did not commit. … The duplicity and deception practiced by BRI was not limited to a one-time act of folly that occasioned limited harm; rather, BRI carried on the charade for the better part of 13 years."
Following a 17-day jury trial in 2006, BRI was found liable for malicious prosecution and ordered to pay damages and costs of $2,078,120.27.
The Court’s ruling on initiating the proceedings follows:
Malicious Prosecution
[44] There are four necessary elements that must be proved for a plaintiff to succeed in an action for malicious prosecution:
a) The proceedings must have been initiated by the defendant.
b) The proceedings must have been terminated in favour of the plaintiff.
c) The absence of reasonable and probable cause; and
d) Malice, or a primary purpose other than that of carrying the law into effect.
See Nelles v.
[45] The focus of BRI’s argument is on initiation. The trial judge’s charge to the jury on the requirement of initiation was as follows:
The first question of fact for you to determine is whether the plaintiff has proven that the criminal proceedings against Doug McNeil were initiated by one or more of the defendants. The plaintiff must prove that the defendant or defendants were the persons who set the criminal proceedings in motion against the plaintiff or the person or persons who aided or encouraged the prosecution as its real instigator. It is not necessary for the plaintiff to prove that the defendant or defendants actually laid the information, as long as you are satisfied on the preponderance of evidence that the defendant or defendants were the ones who were actively instrumental in setting the criminal proceedings in motion.
If you find that the defendant or defendants fairly and truthfully disclosed to the police or to the Crown Attorney all matters within their knowledge that a reasonably prudent person would believe material to the question of the plaintiff’s guilt or innocence and that the determination to prosecute was made by the police or the Crown Attorney or some other responsible person, then the defendant or defendants are not responsible for that prosecution. If, however, you find that the defendant or defendants directed or interfered with the prosecution or insisted that the Crown Attorney or police prosecute, then you would find the defendant or defendants responsible for the prosecution. If the defendant or defendants knowingly provided the police with false information with the intention that the police would take action, this does not necessarily amount to setting the law in motion as to make the defendant or defendants responsible. You must consider the nature of the allegations, the circumstances in which they were made, and the effect it had on the eventual prosecution. In other words, you must determine whether the defendants by providing the false information were actively involved and instrumental to the prosecution. If you find that none of the defendants are responsible for initiating the prosecution, your verdict will be for the defendant and you will proceed no further.
[46] BRI made no objection to the trial judge’s charge on initiation perhaps because the instructions provided were favourable to the defence. The charge left the jury with the impression that a finding of initiation required them to accept the respondents’ position that the defendant instigated the prosecution by supplying false evidence in circumstances where the police had to wholly rely on it and did rely on it.
[47] BRI’s principle submission on this issue is that initiation and malice are separate watertight compartments and that, in deciding whether a person has initiated a prosecution, no qualitative assessment may be undertaken as to whether a person has provided false information or deliberately withheld information from the police. No authorities were submitted by BRI to support this submission and in fact, the jurisprudence suggests a contrary view. The relationship between falsely and maliciously providing information and initiation of a prosecution was described in the House of Lords decision of Martin v. Watson [1996] A.C. 74 at 86:
Where an individual falsely and maliciously gives a police officer information indicating that some person is guilty of a criminal offence and states that he is willing to give evidence in court of the matters in question, it is properly to be inferred that he desires and intends that the person he names should be prosecuted. Where the circumstances are such that the facts relating to the alleged offence can be within the knowledge only of the complainant, as was the position here, then it becomes virtually impossible for the police officer to exercise any independent judgment, and if a prosecution is instituted by the police officer the proper view of the matter is that the prosecution has been procured by the complainant.
[48] This governing principle from Martin v. Watson has been followed and applied in
[49] BRI further suggests that a private party who goes to the police with a criminal allegation initiates the prosecution only if it is “virtually impossible” for the police to independently exercise discretion or judgment as to whether to lay an information. BRI submits that this test has not been satisfied because it gave the entire tape containing the exculpatory evidence to the police and Detective Kane confirmed that an independent evaluation was conducted prior to laying charges.
[50] In contrast, the respondents argue that the law recognizes that there may be a variety of ways to satisfy the initiation requirement, apart from simply the “virtual impossibility” test. Reliance is placed on the decision in Martin v. Watson, which accepted the view that a person may be regarded as the prosecutor or the individual who initiated the action if “he puts the police in possession of information which virtually compels an officer to lay an information; if he deliberately deceives the police by supplying false information in the absence of which the police would not have proceeded; or if he withholds information in the knowledge of which the police would not prosecute.” Martin v. Watson at 84, referring to Commercial Union Assurance Co. of N.Z. Ltd. v. Lamont [1989] 3 N.Z.L.R. 187 at 207-08. See also Berman v. Jenson (1989), 77
[51] The respondents also point out that BRI did not object to the charge on the basis that it lacked an instruction to apply the “virtual impossibility” test.
[52] In our view, this is not a case in which we must decide all the factors that could, in any particular case, satisfy the element of initiation. On the facts of this case, it was open to the jury to find that BRI knowingly withheld exculpatory information from the police which the police could not be expected to find and indeed did not find upon their review of the tapes. But for the withholding of this essential information, McNeil would not have been charged.
[53] The facts here confirm that the police and the Crown relied wholly on BRI, which actively and deliberately misled them. Only a trained operator of the video monitor could properly review the tapes. The police were unable, through their own due diligence, to uncover the exculpatory evidence available to BRI prior to laying charges.
[54] As a result, the police did not have all the information available to BRI prior to laying charges. The appellant’s November, 1993 summary of the tapes identifying the exculpatory evidence and Detective Kane’s evidence that he was never told about the exculpatory evidence until after the criminal trial is strong evidence that BRI deliberately withheld information when it went to the police.
[55] Further, contrary to the appellant’s submission, the jury had evidence that Detective Kane did not conduct an independent investigation. Kane claimed that he used MacFarlane’s witness statement as the basis for his report, only to be confronted with the fact that he used it verbatim. Furthermore, there was evidence from which the jury could find that it was virtually impossible for Kane to perform an independent investigation before laying charges. Perhaps the best evidence is the fact that neither he, nor McNeil’s counsel, nor McNeil himself could locate the exculpatory portion of the alleged
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