27 O.R. (3d) 215
 O.J. No. 152
Court File No. 418/95
Ontario Court (General Division), Divisional Court
O'Leary, McRae and Corbett JJ.
January 23, 1996
The plaintiff appealed an order dismissing its application for an interlocutory injunction to restrain the defendant from unlawfully interfering with its contractual and economic relations by threatening and engaging in secondary picketing. These activities began following a disagreement between the parties about the plaintiff's logging rights on Crown land in Alberta which is the subject of land claims by the Lubicon Indian Band. The plaintiff sought an injunction and damages in tort for interference with its contractual relations. The application was dismissed because the plaintiff failed to establish a prima facie case in tort. The judge found that the intention of the defendant volunteer organization was to help the Lubicon and not to injure the plaintiff, and also that secondary picketing was not illegal per se and therefore did not constitute unlawful means for purposes of establishing a prima facie case.
Held, the appeal should be allowed and injunctive relief granted.
Per Corbett J. (McRae J. concurring): There is clear and unequivocal authority that secondary picketing is illegal in a labour context. In a non-labour context peaceful picketing which is not per se illegal may become unlawful if it is part of the commission of another independent tort. The judge's findings of misrepresentation established a sufficient evidentiary foundation to constitute the illegal acts or illegal means in respect of the economic torts. A prima facie case was established that the defendants induced a breach of contract, intended to injure the defendant in its economic relations with its customers, and did harm by the unlawful means of misrepresentation and intimidation. Picketing and the threat of picketing was one of the means used and it was an essential part of the tortious conduct. As to the Canadian Charter of Rights and Freedoms, no governmental action is involved and the defendant has not proved that the common law is incompatible with Charter values. A prima facie case has been established, irreparable harm has occurred and will continue to occur, and the balance of convenience requires the granting of an interlocutory injunction.
Per O'Leary J. (dissenting): Secondary picketing is not illegal per se, and the plaintiff therefore cannot show that the picketing with which its customers are being threatened is unlawful. On the evidence in this case the plaintiff has failed to establish any reason why peaceful picketing should be enjoined. The order should be amended to prohibit the defendants from threatening or doing anything by way of demonstrations or picketing that is not peaceful.
Cases referred to:
Assad v. Cambridge Right to Life (1989), 69 O.R. (2d) 598 (H.C.J.); British Columbia Government Employees' Union v. British Columbia (Attorney General),  2 S.C.R. 214, 53 D.L.R. (4th) 1, 31 B.C.L.R. (2d) 273, 71 Nfld. & P.E.I.R. 93, 87 N.R. 241,  6 W.W.R. 577, 44 C.C.C. (3d) 289, 30 C.P.C. (2d) 221, 88 D.T.C. 14,047, 50 C.R.R. 397n; Canada Cement LaFarge Ltd. v. B.C. Lightweight Aggregate Ltd.,  1 S.C.R. 452, 145 D.L.R. (3d) 385,47 N.R. 191,  6 W.W.R. 385, 21 B.L.R. 254, 24 C.C.L.T. 111, 72 C.P.R. (2d) 1; Canada Dairies Ltd. v. Seggie (1940), 74 C.C.C. 210,  4 D.L.R. 725 (Ont. H.C.J.); Canadian Broadcasting Corp. v. Dagenais,  3 S.C.R. 835, 25 C.R.R. (2d) 1, 120 D.L.R. (4th) 12, 175 N.R. 1, 94 C.C.C. (3d) 289, 34 C.R. (4th) 269, 20 O.R. (3d) 816n; Channel Seven Television Ltd. v. N.A.B.E.T.,  5 W.W.R. 328, 21 D.L.R. (3d) 424 (Man. C.A.); Crofter Hand Woven Harris Tweed Co. v. Veitch,  A.C. 435,  1 All E.R. 142, 111 L.J.P.C. 17, 166 L.T. 172, 58 T.L.R. 125 (H.L.); Darrigo's Grape Juice Ltd. v. Masterson,  3 O.R. 772, 21 D.L.R. (3d) 660 (H.C.J.); Ford Motor Co. v. McDermott (1978), 20 O.R. (2d) 160, 87 D.L.R. (3d) 109 (H.C.J.); Gershman v. Manitoba (Vegetable Producers' Marketing Board),  4 W.W.R. 406, 69 D.L.R. (3d) 114 (Man. C.A.); Halifax Antiques Ltd. v. Hildebrand (1985), 22 D.L.R. (4th) 289, 69 N.S.R. (2d) 375, 163 A.P.R. 375 (S.C.); Heather Hill Applicances Ltd. v. McCormack,  1 O.R. 12, 52 D.L.R. (2d) 295n (C.A.); Hersees of Woodstock Ltd. v. Goldstein,  2 O.R. 81, 63 C.L.L.C. 15,461, 38 D.L.R. (2d) 449 (C.A.); Hill v. Church of Scientology of Toronto,  2 S.C.R. 1130, 30 C.R.R. (2d) 189, 126 D.L.R. (4th) 129, 184 N.R. 1, 25 C.C.L.T. (2d) 89, 24 O.R. (3d) 865n; Hubbard v. Pitt,  3 All E.R. 1,  Q.B. at p. 161,  3 W.L.R. 201,  I.C.R. 308, 119 Sol. Jo. 393 (C.A.); International Brotherhood of Teamsters, Local 213 v. Therien,  S.C.R. 265, 60 C.L.L.C. 15,273, 22 D.L.R. (2d) 1; Lumley v. Gye (1853) 2 E & B 216, [1843-60] All E.R. Rep. 208, 22 L.J.Q.B. 463, 17 Jur. 827, 1 W.R. 432, 118 E.R. 749; Morgentaler v. Wiche,  O.J. 2582; Nedco Ltd. v. Nichols,  3 O.R. 944, 73 C.L.L.C. 14,191, 38 D.L.R. (3d) 664 (S.C.); Ontario (Attorney General) v. Dieleman (1994), 20 O.R. (3d) 229, 117 D.L.R. (4th) 449 (Gen. Div.) [supp. reasons 22 O.R. (3d) 785, 123 D.L.R. (4th) 757 (Gen. Div.)]; R. v. Salituro,  3 S.C.R. 654, 8 C.R.R. (2d) 173, 131 N.R. 161, 68 C.C.C. (3d) 289, 9 C.R. (4th) 324; R. v. Swain,  1 S.C.R. 933, 3 C.R.R. (2d) 1, 47 O.A.C. 81, 125 N.R. 1, 63 C.C.C. (3d) 481, 5 C.R. (4th) 253; Retail, Wholesale & Department Store Union, Local 580 v. Dolphin Delivery Ltd.,  2 S.C.R. 573, 25 C.R.R. 321, 33 D.L.R. (4th) 174, 9 B.C.L.R. (2d) 273, 71 N.R. 83,  1 W.W.R. 577, 38 C.C.L.T. 184, 87 C.L.L.C. 14,002; RJR-MacDonald Inc. v. Canada (Attorney General),  1 S.C.R. 311, 111 D.L.R. (4th) 385, 60 Q.A.C. 241, 164 N.R. 1, 54 C.P.R. (3d) 114, 20 C.R.R. (2d) D-7; Rookes v. Barnard,  1 All E.R. 367,  A.C. 1129,  2 W.L.R. 269, 108 Sol. Jo. 93,  1 Lloyd's Rep. 28 (H.L.); Slade and Stewart Ltd. v. Retail, Wholesale and Department Store Union, Local 580 (1969), 69 W.W.R. 374, 5 D.L.R. (2d) 736 (B.C.S.C.)Statutes referred to:
Canadian Charter of Rights and Freedoms, s. 1, 2(b)
Criminal Code, R.S.C. 1985, c. C-46
CORBETT J. (MCRAE J. concurring): -- This is an appeal by the plaintiff Daishowa Inc. ("Daishowa") from the order of Kiteley J., dated May 29, 1995 [reported 30 C.R.R. (2d) 26], dismissing the application of Daishowa Inc. for an interlocutory injunction to restrain the defendants, respondents on appeal, from unlawful interference with Daishowa's contractual and economic relations by the threat of secondary picketing and by secondary picketing of Daishowa's customers. Kiteley J. granted limited injunctive relief respecting the nature of the communications with Daishowa's customers. Leave to appeal the order was granted by Steele J. on June 30, 1995.
The Lubicon are a band of 500 Cree Indians who live in the community of Little Buffalo in the north-east area of the Peace River district of Alberta. The Lubicon Nation were not included when Treaty 8 extinguished certain aboriginal land titles in northern Alberta and no treaty purports to extinguish their aboriginal title. The Lubicon claim aboriginal land rights to a 10,000 sq. km. area, described as "unceded Lubicon territory" or "area of concern". Negotiations continue with the federal government with respect to Lubicon land claims.
The respondents, Friends of the Lubicon ("Friends") are an unincorporated volunteer organization formed in 1988. The general objective of the Friends is to increase the level of public knowledge of the plight of the Lubicon and to encourage a land claim settlement with the federal government. The Daishowa boycott involves secondary picketing and is one of many activities engaged in by the Friends which also include speeches, rallies, education, and government lobbying. Daishowa does not object to the picketing of Daishowa and its related companies and does not object to the dissemination of truthful information to the public or to Daishowa's customers.
Daishowa Canada Company Limited (DCCL) was granted logging rights pursuant to a forest management agreement by the Alberta government in 1989 over a large area of Crown land in northern Alberta to supply a pulp mill in Peace River, Alberta. The forest management agreement granted logging rights to the lands over which the Lubicon assert hunting and fishing rights. Each year since 1989 Daishowa has imposed a moratorium on any logging operations within the Lubicon "area of concern". After a public protest, Chief Ominayak, the Lubicon chief, met with Mr. Tom Hamaoka, a Daishowa representative, on March 7, 1988. After this meeting the Lubicon took the position that Daishowa had agreed not to log in the "area of concern". Daishowa denied that such an agreement was reached.
Daishowa announced that its newly-acquired subsidiary Brewster Construction was planning to log 1,000 hectares, which was a continuation of Brewster's previous logging activity. There were fears that this logging would occur in the area of concern and the boycott by the Friends began in November 1991. Initially a letter-writing campaign was used demanding a commitment from Daishowa not to cut any wood on unceded Lubicon territory until the land rights were settled.
Since then, the boycott strategy has remained essentially unchanged with the Friends contacting the customers of Daishowa and demanding that the customers stop using Daishowa's products. A standard initial letter would be sent enclosing background information asking customers not to purchase Daishowa's products in the future. Those customers who did not comply were subject to boycott tactics, including the threat of picketing and secondary picketing.
The boycott campaign was enormously successful. At least 43 companies representing 4,300 retail outlets joined the boycott. As a result of the boycott, about 26 customers discontinued supply services and Daishowa lost a significant portion of its business, estimated at about $5 million worth of sales since 1991. The boycott also affected the ability of Daishowa to acquire new customers.
A boycott is not an illegal act per se. In its ordinary meaning, "boycott" is defined in the Concise Oxford Dictionary as: "to punish, coerce (person, class, nation) by systematic refusal of social or commercial relations; to combine in abstaining from (goods, etc.) with this aim." Picketing is one means of effecting a boycott.
(1) a preliminary assessment of the merits of the case to determine whether there is a serious question to be tried;I will discuss each of these tests in turn.
(2) a determination whether the applicant would suffer irreparable harm unless the injunction was granted, which harm is not susceptible to compensation in damages; and,
(3) a determination of which of the two parties will suffer the greater harm from the granting of or refusal to grant an interlocutory injunction pending a decision on the merits, i.e., the balance of convenience test.
Kiteley J. considered the two exceptions which apply to the general rule that a judge should not engage in an extensive review of the merits. The two exceptions are set out in RJR- MacDonald Inc. v. Canada (Attorney General),  1 S.C.R. 311 at p. 338, 111 D.L.R. (4th) 385 at pp. 403 and 404, as follows:(2) Irreparable harm(1) when the result of the interlocutory motion will in effect amount to a final determination of the action; and,Kiteley J. went beyond a preliminary investigation of the merits because picketing was involved and the impact of an injunction would tend towards finality. Kiteley J. relied upon Ontario (Attorney General) v. Dieleman (1994), 20 O.R. (3d) 229, 117 D.L.R. (4th) 449 (Gen. Div.), in which Adams J. concluded that a more appropriate test to be applied in a picketing case was the demonstration of a prima facie case. Kiteley J. concluded that Daishowa was required to establish a prima facie case in respect of the various torts alleged in the statement of claim. In this regard, we find no fault with her decision to engage in an extensive review of the merits.
(2) when the question of constitutionality presents itself as a simple question of law alone.
Daishowa seeks an injunction and claims damages for interference with its contractual relations. Kiteley J. treated the claim as seeking relief in respect of the alleged torts of misrepresentation, defamation, injurious falsehoods, nuisance, wrongful interference with economic interests, inducing breach of contract, intimidation, and conspiracy. However, the claim is more accurately described as one grounded in the economic interference torts, including conspiracy. In relation to these torts, Daishowa alleged that the unlawful means used included misrepresentation, defamatory statements, innuendo, and injurious falsehoods. Daishowa also alleged the boycotts utilized unlawful means, including secondary picketing, intimidation, watching and besetting and that the information distributed constituted misrepresentation, defamation, and injurious falsehood. Therefore, although the constituent elements of the other torts must be addressed, a critical issue is whether unlawful means have been used.
Kiteley J. found that Daishowa had failed to establish one or more of the following torts: wrongful interference with economic and contractual relations; inducing breach of contract; intimidation; and conspiracy to injure, either on the basis of the prima facie test or the serious issue test.
Kiteley J. found the only tort that was established on a prima facie basis was misrepresentation with respect to the March 7, 1988 agreement and genocide. She was not persuaded on the evidence before her that Daishowa and the Lubicon had an agreement whereby Daishowa would not log on the Lubicon area of concern and that such an agreement was breached. Further, she did not find that Daishowa's refusal to make a commitment not to log was an act of genocide.
Crucial to the determination that no prima facie case was established in respect of the economic torts were her findings that Daishowa had failed to demonstrate either (1) an intention by the Friends to cause economic harm or, (2) the use of unlawful means by the Friends.
The purpose of the boycott as described by the Friends of the Lubicon was to encourage Daishowa to make a clear, unequivocal, and public commitment to refrain from logging on, or buying timber from, unceded Lubicon territory until the Lubicon negotiated a land claim settlement and a timber harvesting agreement which respects Lubicon environmental and wildlife concerns.
As articulated by Daishowa, the aim of the Friends is to coerce the customers of Daishowa's packaging division into terminating existing contracts and undertaking not to purchase Daishowa products in the future. Customers who did not yield to the initial demands of the Friends were subjected to boycott tactics until they ceased to deal with Daishowa.
Kiteley J. found that the intention or purpose of the Friends was to support the Lubicon and was not to cause injury to Daishowa, although injury occurred. She further held that secondary picketing did not constitute unlawful means because secondary picketing was not illegal per se and was not illegal in this case.
With respect to the second test, Kiteley J. found that Daishowa suffered significant irreparable harm both in terms of lost sales and with respect to loss of future business. She also found it was unlikely the Friends would have the ability to pay any award of damages which might be made at trial to compensate Daishowa for its lost business.(3) Balance of convenience
With respect to the third test, Kiteley J. found that the "balance of convenience" favoured the Friends for the following reasons:(i) the Charter rights of freedom of expression, freedom of conscience and freedom of association manifested in the actions of the Friends must be given consideration, along with the competing interests of Daishowa to profit;In conclusion, Kiteley J. did not grant an injunction restraining picketing or the threat of picketing in respect of Daishowa's customers. As a result of an admission by the Friends that they may have been intemperate, Kiteley J. imposed conditions on the Friends. These conditions included: prohibiting references to a breach of the 1988 agreement and genocide; and, giving Daishowa copies of future correspondence addressed to Daishowa's customers.
(ii) the public interest in protecting the claims of aboriginal peoples is important;
(iii) the use of a boycott to communicate a public message is an effective tool in accomplishing political and social objectives;
(iv) while inconvenienced, and in some cases irritated and subjectively intimidated, none of the customers was unable to meet packaging needs at similar cost;
(v) there was no cross-motion to restrain logging;
(vi) having undertaken a self-imposed moratorium for four winters, and with a trial as early as January 1996, Daishowa would miss one more logging season which would be far less inconvenient than harvesting thousands of trees which may ultimately be found to be the property of the Lubicon.
(1) whether Daishowa has established a prima facie case or a "serious question" to be tried in respect of one or more of the economic torts, namely: wrongful interference with economic relationships, inducing breach of contract, intimidation, and conspiracy; andIt is the position of Daishowa that the common law of Ontario prohibits secondary picketing and that there is no common law basis for distinguishing secondary picketing in a labour context from secondary picketing in a political or social context.
(2) whether the learned judge erred in holding that secondary picketing was not unlawful per se in a non-labour context.
It is the position of the Friends that secondary picketing per se is not unlawful in a non-union context and that Kiteley J. did not err in finding that the Friends lacked the requisite intent or purpose to establish a prima facie case that any tort had been committed.
The legality of secondary picketing is a critical and pivotal issue. If secondary picketing is illegal per se in non-labour circumstances, that is determinative of the test of a prima facie case. The legality of such picketing is also relevant to the consideration of "unlawful means" in respect of the various economic torts alleged if the requisite intention to harm is established. In this case, no claim is made in nuisance, as such. Accordingly, the issue of secondary picketing will be discussed on the basis that the secondary picketing which took place or will take place is peaceful picketing and does not constitute a nuisance, a trespass, or watching and besetting.
The leading Ontario authority respecting secondary picketing in a labour context is Hersees of Woodstock Ltd. v. Goldstein,  2 O.R. 81, 38 D.L.R. (2d) 449 (C.A.). In Hersees, secondary picketing of a retailer handling goods of a manufacturer with whom a union was in a collective bargaining dispute was held to be illegal per se even though the picketing was not surrounded by extrinsic unlawful elements. The court held that even if the picketing was lawful in the sense of being merely peaceful picketing for the purpose only of communicating information, it should be restrained and that the right to secondary picketing if there was such a right, must give way to the appellant's right to trade. Aylesworth J.A. at p. 86 O.R., described the right to engage in secondary picketing as a right exercised for the benefit of a particular class, whereas the right to trade is the benefit of the community at large. He characterized the right to trade as more fundamental and of far greater importance than the right to engage in secondary picketing. Aylesworth J.A. further stated at p. 86 O.R., that he was unable to find a clear precedent for this principle and observed that in each case supporting the principle, the secondary picketing embraced one or more admittedly unlawful elements such as trespass, intimidation, nuisance, or inducement of breach of contract. Nonetheless, he viewed the cases as declaring secondary picketing to be illegal per se.THE ECONOMIC INTERFERENCE TORTS
Secondary picketing has been described as containing illegal elements. In Heather Hill Appliances Ltd. v. McCormack,  1 O.R. 12 at p. 13, 52 D.L.R. (2d) 295n (C.A.), Stewart J. defined secondary picketing as "the watching and besetting of a place occupied by a person or company having no dispute with the picketers or its employees". The ratio was followed and he held that secondary picketing, though peaceful, was illegal per se.
However, there have been conflicting views of the ratio in Hersees in both labour and non-labour cases. In Darrigo's Grape Juice Ltd. v. Masterson,  3 O.R. 772, 21 D.L.R. (3d) 660 (H.C.J.), the defendant and others picketed the applicant urging people not to buy the applicant's grapes, with the object of discouraging the plaintiff from selling grapes provided by a California grower. Keith J. held that although one may sympathize with the aims of persons seeking to improve the conditions of workers in California, the picketing was illegal. He stated at pp. 773-74 O.R.: "secondary picketing is prohibited for very sound social reasons . . . regardless of the motives, their conduct cannot be permitted".
Osler J. in Nedco Ltd. v. Nichols,  3 O.R. 944, 38 D.L.R, (3d) 664 (S.C.), doubted that Hersees held that secondary picketing was illegal per se and stated at pp. 951-52 O.R.:Whatever may be "commonly known as secondary picketing", the situation I am here considering cannot be so described. It is sometimes said that Hersees of Woodstock Ltd. v. Goldstein et al.,  2 O.R. 81, 38 D.L.R. (2d) 449, laid down the proposition that secondary picketing was illegal per se. If that is the correct meaning to be drawn from the case, a satisfactory definition of that phrase still has not been forthcoming. In the Hersees case, the picketing, in itself lawful and unobjectionable, was being conducted at the premises of a merchant whose only connection with the employer party to the labour dispute, which incidentally was a boycott rather than a strike, was that of a retailer who offered for sale, amongst many other items, some garments manufactured by the employer party to the dispute.In Ford Motor Co. v. McDermott (1978), 20 O.R. (2d) 160 at p. 163, 87 D.L.R. (3d) 109 (H.C.J.), Pennell J. observed that Hersees "looked at broadly" may be cited as authority for the proposition that secondary picketing is, per se, illegal, but that it had to be read in light of the 1970 amendments to the Judicature Act, R.S.O. 1970, c. 228.
In those cases that have purportedly followed the Hersees case, such as Heather Hill Appliances Ltd. et at. v. McCormack et al.,  1 O.R. 12, 52 D.L.R. (2d) 292, and J.S. Ellis & Co. Ltd. v. Willis et al.,  1 O.R. 121, 30 D.L.R. (3d) 397, as well as in the Darrigo's case already mentioned, the relationship between the parties at whose premises the picketing occurred and the party to the dispute put forward as authorizing the picketing was in each case a remote one. Therefore, if what is now s. 20 of the Judicature Act is to be read as having application to what is commonly known as secondary picketing, a proposition which I confess to having difficulty in understanding, what has taken place in the case at bar does not fall within the principle laid down in Hersees case.
The principle of the inherent illegality of secondary picketing was applied in Assad v. Cambridge Right to Life (1989), 69 O.R. (2d) 598 (H.C.J.), in a non-labour context. Doctors' offices were picketed in an effort to dissuade them from performing abortions. An interlocutory injunction was granted on the grounds that there was a substantial issue to be tried on the allegations of defamation in respect of placards which accused the doctors of "killing" unborn babies. Scott L.J.S.C. relied upon Hersees and at p. 604 adopted the definition of secondary picketing described in Morgentaler v. Wiche,  O.J. 2582, as "picketing by persons who have no relationship, professional, business or social or otherwise" with the persons subjected to the picketing". Scott L.J.S.C. found substantial issues to be tried in respect of defamation, trespass, nuisance, and inducing breach of contract and found that there was an unwarrantable interference with the legitimate exercise of professional duties, that is, legitimate trade. Injunctive relief was granted and the decision was upheld on appeal.
The issue of secondary picketing has been considered in other jurisdictions.
In Slade and Stewart Ltd. v. Retail, Wholesale and Department Store Union, Local 580 (1969), 69 W.W.R. 374, 5 D.L.R. (2d) 736 (B.C.S.C.), the plaintiffs were engaged in the wholesale purchase of fruits and produce from California and Arizona. The B.C. Federation of Labour announced refusal on the part of trade union members to handle grapes from California and Arizona in order to support those grape workers. The letter to affiliated locals was held to constitute an unlawful inducement of breach of contract. MacDonald J. held that the interference with the contractual relations of the employees was bound to damage the plaintiff and must have been so intended. It was noted that there was no tort if there was sufficient justification for interference with contractual relations. Notwithstanding that the cause may be a very worthy one, MacDonald J. found the actions taken went beyond laying the facts before the public to urge them to buy the grapes and the actions taken deprived the plaintiff and its employees of any choice as to participating in the boycott of grapes.
In Channel Seven Television Ltd. v. N.A.B.E.T. (1971), 21 D.L.R. (3d) 424,  5 W.W.R. 328 (Man. C.A.), the defendant union, during a lawful strike, attempted to persuade advertisers with Channel 7 to withdraw their advertising. The union representatives would call upon an advertiser, acquaint the advertiser with the issues, and urge it not to advertise on Channel 7 while the strike was on. If the advertiser failed to comply, a picket line would be set up in front of its premises with signs stating: "This company advertises on CJAY-TV during a legal strike." For the purposes of the appeal, Freedman C.J.M. held that the affidavit evidence established that the conduct came within the tort of inducing breach of contract in a prima facie way. He also held that an actual breach of contract need not be proved and that a threatened breach was sufficient. At p. 431 he stated:Basically, we are here concerned with the limits attaching to the exercise of the right of freedom of speech. That right is justly prized in a free society. But it is not absolute in nature. In certain circumstances it may have to yield to the assertion of some other right by another member of society or to the claims of society as a whole. For liberty is achieved through harmonizing contending interests, through a reconciliation between conflicting social values. In the present case we face a conflict between the right of the union to exercise freedom of speech (including picketing, which is sometimes described as symbolic speech) and the right of the plaintiff and its advertisers to freedom of trade and contract.Freedman C.J.M. found the activities in furtherance of the strike were lawful and the information communicated on the signs and in the letters was truthful. Freedman C.J.M. discussed Hersees at p. 436:The Ontario decision of Hersees of Woodstock Ltd. v. Goldstein, 38 D.L.R. (2d) 449,  2 O.R. 81, was referred to by Solomon, J. [the motions court judge]. He interpreted it as coming fairly close to declaring secondary picketing to be illegal per se. With respect, I think that case may be read as going all the way in that direction. But I have the following comments on the Hersees case: First, although it is of persuasive value, it is not binding on this Court. Secondly, it has been the subject of searching criticism. (Vide the comment by Prof. H. W. Arthurs in (1963), 41 Can. Bar Rev. 573.) Thirdly, the union's placards were there found to be deceptive. Finally, there was no legislative enactment in Ontario restricting the right to an injunction, such as we have here.And at p. 437:"Picketing is necessarily calculated to cause harm", said Dr. A. W. R. Carrothers in an article entitled "Secondary Picketing" (1962), 40 Can. Bar Rev. 57 at p. 66. Secondary picketing, even though carried on in furtherance of a union's legitimate interests in a labour dispute, may well cause harm to innocent third parties. The plight of those who, through no fault of their own, and without a labour dispute with their own employees, suddenly find themselves the victims of secondary action by a union is one that justly commands sympathy. But we have here a conflict between rights -- the right of labour to protect and advance its cause, and the right of those affected by labour's action to freedom of trade and of contract.In Halifax Antiques Ltd. v. Hildebrand (1985), 22 D.L.R. (4th) 289, 69 N.S.R. (2d) 375 (S.C.), tenants who received notices to quit picketed in front of a retail business owned by the person who owned the company that was their landlord. The picketing was peaceful. The signs indicated dissatisfaction with the landlord and did not request a boycott of the retail business. The plaintiff claimed there was a possibility of economic damage or harm if the customers were intimidated from doing business with its store, but the judge found there was no such evidence. The plaintiff submitted that the activity was secondary picketing and that secondary picketing in itself is illegal. Kelly J. reviewed the cases including Hersees and observed that the secondary picketing embraced one or more admittedly unlawful elements, such as trespass, intimidation, nuisance or inducement of breach of contract. Kelly J. concluded that secondary picketing is not illegal in all circumstances and stated at p. 294:When there is a clear association between the employer and the party being picketed and where the picketing is peaceful and does not involve any unlawful elements . . . such picketing may be legal.Kelly J. was satisfied there was a substantial relationship between the landlord company and the plaintiff and, if the corporate veil were pierced, they were the same person. He distinguished between labour and non-labour picketing and found the predominant reason for the picketing in the matter before him was not to cause financial loss to the plaintiff company, but to bring public pressure to bear. In refusing to grant an injunction restraining the picketing, Kelly J. acknowledged the defendants were exercising the basic freedom of expression guaranteed by the Canadian Charter of Rights and Freedoms.
In her decision, Kiteley J. relied extensively on the analysis of the various torts contained in the decision Ontario (Attorney General) v. Dieleman, supra, an abortion picketing case. She adopted the approach of Adams J. respecting secondary picketing.
Adams J. found that the activities of the defendants outside the clinics did not constitute secondary picketing and distinguished picketing in labour relations from picketing at the clinics. He found the primary/secondary distinction arbitrary with respect to parties caught up in the "abortion debate". Adams J. described the distinction which arises from the structure of an employment relationship in labour law as much less pronounced for political protesters who will often have multiple targets of their messages because of their multiple purposes.
Adams J. noted the court's reluctance to enjoin picketing as an exercise of civil rights, citing at p. 279 O.R., p. 660 D.L.R., Lord Denning, in dissent, in Hubbard v. Pitt,  3 All ER. 1,  Q.B. at p. 161 (C.A.), to the effect that the right to demonstrate should be exercised without impediment so long as no wrongful act is done. In fact, a majority of the court in Hubbard granted an injunction restraining picketing as there was a real prospect that the continuance of the defendant's activities outside the plaintiff's premises would seriously interfere with the plaintiff's business and that damages would be an inadequate remedy. Further, at p. 16 of Hubbard, Stamp L.J. quoted the learned judge of the lower court and noted that such picketing may destroy a person's trade without compensation, and that the defendants were still free, at some other place and by legitimate means, to bring their dislike of the plaintiff's actions before the public.
Adams J. found, however, that the pickets outside the homes of doctors engaged in providing abortion services was disruptive and constituted a prima facie case of the crime of watching and besetting and that the picketing included purposes, other than and in addition to, mere communication of information.
The common law rule against secondary picketing in a labour context was continued in Retail, Wholesale and Department Store Union, Local 580 v. Dolphin Delivery Ltd.,  2 S.C.R. 573, 33 D.L.R. (4th) 174. McIntyre J. found on the facts that the purpose of the secondary picketing was to induce a breach of contract and thus to exert economic pressure. He noted that all picketing is designed to bring economic pressure on the person picketed and to cause economic loss for so long as the object of the picketing remains unfulfilled. At p. 588, the chambers judge granted the injunction on the basis that the picketing involved the commission of two common law torts: civil conspiracy to injure and inducing "breach of contract". The court concluded that secondary picketing in labour cases should not be permitted to harm others and picketing should be restricted to the actual parties in the conflict.
The court went on to discuss the application of the Charter to the common law, which I will address later. Thus, there is clear and unequivocal authority that secondary picketing is illegal per se in a labour context, but there is no clear authority in a non-labour case.
I agree with the observations of Adams J. in Dieleman that the description of picketing as secondary does little to advance the discussion of the limits of the exercise of the right to picket in non-labour cases. It is difficult to conclude that peaceful picketing is illegal. A bystander observing a picket line outside the Holt Renfrew store in Toronto (one of Daishowa's customers who joined the boycott) in Toronto may conclude that:(a) the picketing is part of a labour dispute,In Dolphin Delivery, McIntyre J. described at p. 586 S.C.R. that the "picketers would be conveying a message which at a very minimum would be classed as persuasion, aimed at deterring customers and prospective customers from doing business with the respondent". The only way to ascertain the purpose of the picketing would be to read the signs or any pamphlets being distributed. As in other socially contentious situations, the bystander may or may not agree with the message. In each case, however, the bystander would infer that the object of the picketing is integrally related to the store being picketed.
(b) the picketing is directed against Holt Renfrew itself, for example, by the anti-fur lobby to discourage the sale of fur garments, or perhaps,
(c) the picketing is directed at customers to discourage trade at the store.
Freedom of expression is not absolute and is subject to other public and private rights, e.g., the law of defamation, obscenity provisions of the Criminal Code, R.S.C. 1985, c. C- 46, and so on. In this case, the freedom of expression and the right to trade come into conflict. Each comports individual and social values which must be balanced in the circumstances of the case.
Kiteley J. relied upon the observation of Adams J. in Dieleman that the evolving tort of interference with economic interests would appear to apply only if the picketing is itself unlawful. Adams J. stated at p. 675 D.L.R. that the tort most capable of ensuring this conduct, without binding itself beyond recognition, is that of nuisance. As I have previously indicated, nuisance is not the only tort which can provide the unlawful means. For example, Adams J. agreed with the analysis in Halifax Antiques. In any event, given the substantial connection between the landlord and the store being picketed, I doubt that the picketing in Halifax Antiques can properly be characterized as secondary picketing in the traditional sense. In Canada Dairies Ltd. v. Seggie (1940), 74 C.C.C. 210,  4 D.L.R. 725 (H.C.J.), cited by Adams J., an application for an injunction to restrain "secondary" picketing was dismissed. After reviewing the authorities, Mackay J. in Canada Dairies concluded that picketing per se is not unlawful and stated at p. 219:...picketing is only wrongful; (a) If it is featured by defamatory statement or (b) If it is carried on in such manner as to disclose a purpose other than peacefully "obtaining or giving information," or (c) If it is part of a conspiracy to injure.In my view, peaceful picketing per se is not illegal, but may become unlawful if it is part of the commission of another independent tort. The proper approach is to determine if the evidence is sufficient to establish the commission of tortious or otherwise unlawful conduct. I therefore turn to the torts alleged to determine if a prima facie case has been raised.
It is useful to describe each of the economic interference torts briefly.
The tort of intentional interference with contractual relations and economic interests requires the plaintiff to prove:(1) an intention to injure the plaintiff;The tort of inducing breach of contract requires the plaintiff to prove:
(2) interference with another's method of gaining his or her living or business by illegal means: see International Brotherhood of Teamsters, Local 213 v. Therien,  S.C.R. 265 at p. 280, 22 D.L.R. (2d) 1; and
(3) economic loss caused thereby.(1) the defendant's knowledge of the contract and its terms;(See Lumley v. Gye (1853), 2 E & B 216, 22 L.J.Q.B. 463.)
(2) the intention to procure a breach of the contract;
(3) conduct by which the defendant directly persuades or induces a third party to break a contract with the plaintiff;
(4) there must be a breach of contract; and
(5) the plaintiff must suffer damage.
The tort of illegal conspiracy to injure requires the plaintiff to establish:(1) an agreement by two or more persons;For this tort, the real or predominant purpose of the agreement must be to inflict harm on the plaintiff.
(2) (a) the agreement must be to do an unlawful act or to effect an unlawful purpose; or
(b) the agreement must be to do a lawful act by unlawful means; and
(3) the plaintiff must suffer damage.
With respect to 2(a), to determine if the agreement was to effect an unlawful purpose, the governing principles are:(i) a combination of two or more persons wilfully to injure a person in his or her trade;(See Hersees of Woodstock Ltd. v. Goldstein, supra, at pp. 89-90.)
(ii) if the real purpose of the combination is not to injure another, but to serve the legitimate interests of those who so combine, the act is not tortious, even if damage results.
The tort of intimidation requires the plaintiff to prove:(1) coercion of another to do or refrain from doing an act;(See Morgentaler v. Wiche, supra.) The tort of intimidation can be intimidation of the plaintiff or intimidation of other persons to the injury of the plaintiff: Rookes v. Barnard,  1 All E.R. 367 at p. 397,  A.C. 1129 (H.L.), per Lord Devlin.
(2) the use of a threat as a means of compulsion;
(3) the threat must be to use unlawful means;
(4) the person threatened must comply with the demand;
(5) intention to injure the person threatened; and
(6) the person threatened must suffer damage.
It is easy to understand why discussion of these overlapping torts becomes circuitous. If secondary picketing were unlawful, it would constitute the unlawful means for the above torts, with the exception of inducing breach of contract. If secondary picketing is not unlawful per se the court must still consider if the acts and means undertaken were or became unlawful and, in this regard, the intention of the defendants becomes the critical factor.
In the case at bar, Daishowa alleged as the unlawful means misrepresentation and defamation with respect to (1) the status of logging operations; (2) the March 7, 1988 agreement; and (3) genocide. Kiteley J. dealt with these torts as separate torts, finding no prima facie case was established respecting the status of logging, but the evidence may have satisfied the "serious issue" test. Kiteley J. found Daishowa established a prima facie case that the agreement described by the Friends was not made and may constitute misrepresentation but not defamation or injurious falsehood. She reached the same conclusion respecting the attribution of genocide to Daishowa.
I view these findings as establishing a sufficient evidentiary foundation to constitute the illegal acts or the illegal means in respect of the economic torts. On this basis, and accepting for this purpose the evidentiary conclusions of Kiteley J., there is a serious issue to be tried with respect to whether the defendants misrepresented the status of logging, whether there was a breach by Daishowa of the 1988 agreement, and whether the attribution of genocide and the evidence in respect of the latter two areas established a prima facie case. Thus, there is sufficient evidence of misrepresentation, that is of a tortious act, which must beconsidered in the analysis of the economic torts.
In the instant case, the contractual relations of Daishowa and its customers tended to take the form of continuing purchase orders. Kiteley J. found that at the outset the Friends urged customers to breach their contracts with Daishowa and, over time, the customers were admonished not to make any new orders. Existing supplies were used until depleted. Kiteley J. found that the tort of inducing breach of contract was not made out as the customer was not induced to breach a contract; rather, the customer was induced to refrain from entering a new contractual relation. Daishowa lost ongoing business which may well have continued. This is not akin to persuading a prospective customer not to deal with a particular supplier.
In Gershman v. Manitoba (Vegetable Producers' Marketing Board) (1976), 69 D.L.R. (3d) 114 at pp. 118-20,  4 W.W.R. 406 (Man. C.A.), the court found that the distinction between the various "economic torts" is somewhat artificial and the tort of interference with economic relationships may be committed even if there is no actual breach of a contract. In my opinion, as stated in Morgentaler, interference with a contract or an existing contractual relationship which falls short of causing an actual breach but results in the untimely conclusion of relations is nonetheless actionable. Kiteley J. erred in finding that it was necessary to establish actual breach of contract in these circumstances.
There being evidence of misrepresentation and evidence of economic interference amounting to a breach of contract within the meaning of the tort of inducing breach of contract, I now turn to consider whether the requisite intention exists to constitute one or more of the torts of economic interference.
Kiteley J. found that the fundamental objective of the Friends was to assist the Lubicon in establishing a land claims agreement and this objective was pursued in a variety of educational and lobbying efforts. She also found that while the boycott resulted in injury to Daishowa, it was not the intention of the Friends to cause injury. Kiteley J. found there was no evidence that the intention to injure customers or distributors of Daishowa was the motivation of the Friends. The intention was to communicate a message to consumers to enable those consumers to make informed choices at the point of purchase. The pursuit of the objective reflected a moral duty which would constitute justification for inducing breach of contract had such breach been established.
It is difficult to distinguish the element of the requisite intention in respect of the particular tort alleged. The words "intention" and "purpose" are both used. "Ultimate" and "predominant" are used to describe purpose. Nonetheless, "motive" must be distinguished from either "intention" or "purpose".
Motive cannot justify an otherwise unlawful act or an otherwise tortious act. The morality of the goal cannot sanction unlawful means. Regardless of the overall purpose of the Friends, the appropriate method of analysis is to look at the intention or purpose of the acts complained of. Intention has both subjective and objective elements. The intent to cause injury may be inferred in circumstances where the Friends knew that injury to Daishowa would ensue. I will review some of the evidence to determine if the Friends intended to interfere with the contractual relations of Daishowa and its customers.
In this regard, the critical intention to be examined is that of the Friends with respect to Daishowa and the critical act or course of action are those directed at Daishowa.
The letter dated November 6, 1991 by Kevin Thomas to Tom Hamaoka of DCCL, stated in part, as follows:We expect from you a clear, firm and public commitment to not cut and not to purchase any wood cut on unceded Lubicon territory until after a settlement of Lubicon land rights and negotiation of a harvesting agreement with the Lubicon people that takes into account Lubicon wildlife and environmental concerns. Until such time we are initiating a public boycott campaign of Daishowa products.The reply from James Morrison dated November 8, 1991 advised:
This campaign will encompass all Daishowa products which reach the public, including all paper products and chip board. We are currently negotiating with many of your clients who have shown an interest in the Lubicon Nation's concerns and are reconsidering their contracts with Daishowa.This is in reply to your letter to Mr. Tom Hamaoka dated November 6, 1991. In recent weeks, Daishowa Canada has been attempting to dispel the negative effects of some of the misleading reports published in the press. Therefore, we have attached for your perusal, a copy of Daishowa Canada's position paper which outlines the Company's efforts respecting the Lubicon situation.In response, by letter dated November 10, 1991 addressed to Tom Hamaoka, Mr. Thomas requested clarification of various matters before considering disengaging the public action campaign and his letter concluded:
You may not be aware the Daishowa Canada (and its subsidiaries) have elected to avoid the area of concern to the Lubicons this winter....As we have stated in the past, until we see the afforementioned [sic] firm and public commitment from Daishowa which is acceptable to the Lubicon Nation, we will continue to mount a full-scale challenge to Daishowa's plans through a public boycott and action campaign. No doubt by now you will have heard from several of your many clients who have been contacted by us. Each day we are identifying and approaching new clients who are concerned with the issues being raised here. I believe it is in your best interests to make a commitment as soon as possible. We will look forward to hearing from you.The Friends issued a press release on November 11, 1991, which stated in part, "Within the next few days...Daishowa...will begin clear cutting the traditional, unceded territory of the Lubicon Cree Nation in Northern Alberta. Stop the Genocide." It called for a demonstration on November 14, 1991 at Daishowa's offices on Bay Street. Respecting the boycott, the press release stated:Lubicon supporters are calling for a boycott against those businesses that refuse to stop using Daishowa paper products.The following are examples of the approaches taken by the Friends with respect to customers of Daishowa, which are described in detail in the decision of Kiteley J. By letter dated August 15, 1991, the defendant, Stephen Kenda, wrote to the L.C.B.O. and stated that Daishowa was violating the March 1988 agreement, that Daishowa's clear cutting continued to accelerate the cultural genocide and concluded: "the Friends of the Lubicon strongly urge the L.C.B.O. to employ an alternate source for its paper bags". After approaching the Minister of Consumer and Commercial Relations, the Ministry decided to stop using Daishowa paper products without endorsing support for the boycott.
The standard initial letter included a statement such as the following used in 1991: "This letter serves as notice to you that a boycott of your company will be initiated unless we receive from you written confirmation by November 25, 1991 of your intention to stop using Daishowa paper products."
Knechtel Stores:We hope you'll support this action by choosing a different supplier for your packaging. (November 15, 1991)Cultures:. . . a boycott of your company will be initiated unless we receive from you written confirmation by November 25, 1991 of your intention to stop using Daishowa paper products.Country Style Donuts:The following extract appears in the fax sent by Thomas dated January 27, 1992:Water Sports:While Daishowa has been telling you since early January they plan to send you a written promise not to clearcut until there's a settlement of Lubicon land rights, they've been clearly saying the opposite to everyone else.
Rather than waiting for a promise that doesn't seem to be forthcoming, it would seem appropriate for Country Style to write Daishowa informing them that contracts won't be renewed unless they make such a promise.By letter dated March 17, 1992, Thomas forwarded information, reported that Daishowa had not cut that winter, but suggested Daishowa would do so next winter "when the heat is off". He indicated that the "economic pressure" of the boycott had probably held them off that winter.A & W:A letter dated July 3, 1992 asked A & W to "make a decision in advance not to buy Daishowa paper products when the time comes to re-order" and by follow-up letter dated September 3, 1992, Thomas indicated "Daishowa is planning to begin logging again this fall". Failing a response on a negative decision, they would boycott A & W.In a press release of January 21, 1992, the Friends announced that a one-season moratorium was held to be insufficient and the boycott pressure would be increased to effect a commitment not to cut on unceded territories until land claims were settled.
Some of Daishowa's customers joined the boycott immediately, some customers changed suppliers for reasons stated to be other than the boycott, others joined on the eve of picketing and two customers joined after picketing, namely, Pizza Pizza and Woolworths.
In respect of Pizza Pizza, it was asked to find a new supplier for its paper products, failing which the Friends would not need to initiate a boycott of Pizza Pizza outlets. By press release dated November 28, 1991, a Pizza Pizza located in Toronto was targeted for demonstration. Leaflets distributed at the demonstration contained in Appeal Book II at p. 300 referred to Daishowa's breach of the 1988 agreement and stated: "Support the boycott of Pizza Pizza stores until they cancel their contracts with Daishowa." Pizza Pizza relented and agreed not to purchase Daishowa products because its franchisees sustained substantial financial damage.
The Friends newsletter reported in October 1992:Despite repeated attempts at a negotiated settlement FOL was forced to launch a boycott of Pizza Pizza stores in order to force them to give up their Daishowa merchandise. Three months of picketing, leafletting, letters, phone calls, and convincing advertising sources to deny Pizza Pizza ad space, and the Pizza giant gave in. As a result of pressure mounted against them, Pizza Pizza joined the Daishowa boycott, contrary to their earlier statement that they would continue to support Daishowa until "hell freezes over".A press release dated January 12, 1994 announced Woolworth's had surrendered to Daishowa boycott pressure stating in part as follows:The Woolworth decision comes after over a half year of public action organized by the Lubicon solidarity network of which Friends of the Lubicon (Toronto) is a part. Action have included store front pickets, protest phone-in's, fax attacks, a mail campaign, boycott information dissemination and "anything else we could think of to kick their asses." Lubicon supporters count the Woolworth decision as their biggest victory to date in their battle to help prevent the resumption of clearcut logging on unceded Lubicon land by Daishowa.There is sufficient evidence that the purpose of the picketing was to induce a Daishowa customer to cease to do business with Daishowa. The purpose as expressed to the customers of Daishowa and to the general public was to discourage the customer from doing business with Daishowa. Its purpose was not to induce customers of the secondary target (a third party to the dispute) to cease to do business with Daishowa's customers. The focus and aim was to persuade Daishowa's customers to cease trading with Daishowa so that economic harm would be experienced by Daishowa. This would obtain the desired commitment as part of the overall objective to support the Lubicon.
Interference with the economic relations of Daishowa and its customers could reasonably be expected to cause damage to Daishowa and this result must be taken to have been intended. The question then becomes to what extent is the ultimate or overall intention, or goal, or purpose, pertinent in respect of the intentions with which the acts were undertaken. The answer to this question is the same as determining whether there is sufficient justification for interference with economic relations.
No such justification was found in Slade & Stewart Ltd. and none can be found in the case at bar. The ultimate moral goal cannot justify an otherwise illegal act in the absence of some duty to interfere.
In conclusion, there is a prima facie case established that the Friends induced a breach of contract, intended to injure Daishowa in its economic relations with its customers and did harm to Daishowa by the unlawful means of misrepresentation and intimidation. Picketing and the threat of picketing was one of the means used by the Friends and it was an essential part of the tortious conduct.
Cory J. in Hill v. Church of Scientology of Toronto,  2 S.C.R. 1130, 126 D.L.R. (4th) 129, discussed Dolphin Delivery and stated at p. 1165 S.C.R., p. 153 D.L.R.:
In emphasizing that the common law should develop in a manner consistent with Charter principles, a distinction was drawn between private litigants founding a cause of action on the Charter and judges exercising their inherent jurisdiction to develop the common law.Cory J. continued on and reviewed the cases since 1986 where the Supreme Court of Canada subjected the common law to Charter scrutiny where government action was based upon a common law rule. The case at bar is not similar to British Columbia Government Employees' Union v. British Columbia (Attorney General),  2 S.C.R. 214, 53 D.L.R. (4th) 1, 44 C.C.C. (3d) 289, where the law courts were picketed in the course of a legal strike: R. v. Swain,  1 S.C.R. 933, 63 C.C.C. (3d) 481; R. v. Salituro,  3 S.C.R. 654, 68 C.C.C. (3d) 289; or Dagenais v. Canadian Broadcasting Corp.,  3 S.C.R. 835, 120 D.L.R. (4th) 12, 94 C.C.C. (3d) 289. In each of these cases some government action was involved. At p. 1169 S.C.R., p. 156 D.L.R., Cory J. stated:
...the common law must be interpreted in a manner which is consistent with Charter principles. This obligation is simply a manifestation of the inherent jurisdiction of the courts to modify or extend the common law to comply with prevailing social conditions and values.Nonetheless, it is important not to import into private litigation the analysis which applies in cases involving government action.
In the case at bar, no governmental action is involved. As McIntyre J. stated at p. 599 in Dolphin Delivery:
...the Charter applies to the common law but not between private parties. The problem here is that this is an action between private parties in which the appellant resists the common law claim of the respondent on the basis of a Charter infringement.The litigation herein is strictly private litigation. The parties owe each other no constitutional duties. The cause of action is not based upon a Charter right. As in Dolphin Delivery, a Charter right is used to ground a defence, not to establish a right.
In terms of the case at bar, the question is whether the common law prohibiting secondary picketing should be modified in consideration of freedom of expression. However, the courts must not go further than necessary and far-reaching changes to the common law must be left to the legislature.
On the approach I have adopted, the common law provides that secondary picketing is unlawful when used in furtherance of the torts of economic interference and conspiracy to harm. The common law then requires no modification. As in Dolphin Delivery, picketing in non-labour cases receives Charter protection if it does not encompass unlawful acts. The Friends have not proven that the common law is inconsistent with Charter values and that its provisions cannot be justified.
In my view, a prima facie case has been established and there are serious issues to be tried. Irreparable harm has occurred and will continue to occur which cannot be adequately compensated for in damages. In these circumstances, the balance of convenience requires the granting of an interlocutory injunction enjoining the Friends from intentionally interfering with Daishowa's contractual and economic relations by unlawful means, including picketing and threats of picketing aimed at Daishowa's customers. Other lawful boycott activities are not enjoined.
The balance of convenience also requires that Daishowa continue its self-imposed moratorium in logging on the lands on which the Lubicon claim traditional rights pending trial. This course of action has been voluntarily imposed since 1989 and should be maintained pending trial.
The appeal is allowed and injunctive relief is granted as described above.
Subject to being spoken to, costs shall be determined by the trial judge.
The appeal is from the order of Kiteley J., made in motions court, refusing to grant to the plaintiff, Daishowa Inc. ("Daishowa"), an injunction prohibiting the defendants from threatening Daishowa's customers with secondary picketing or carrying on secondary picketing of the customers.
Since November 1991, the defendants Thomas, Bianchi, Kenda and others, all belonging to an unincorporated organization known as Friends of the Lubicon, have carried on a campaign to get customers of Daishowa to boycott its products. Daishowa is the major Canadian manufacturer of paper shopping bags. The purpose of the boycott campaign is to put economic pressure on Daishowa Paper Manufacturing Co. Ltd. (the company at the top of a pyramid of Daishowa companies and the ultimate owner of Daishowa Inc.) to require Daishowa Canada Company Ltd., another of its subsidiaries, to make a public commitment to refrain from logging on, orbuying timber from, land in which the Lubicon Band of Cree Indians claim to have aboriginal rights, until such time as the Lubicon Band has settled its long-standing land claim dispute with the government of Canada and has negotiated a timber harvesting agreement.
The boycott campaign has remained essentially unchanged since November of 1991. Its aim has been to convince or coerce customers of Daishowa into undertaking not to purchase Daishowa products in the future. Customers who do not yield to the defendants' demands are subjected to threats of picketing and eventual picketing until they cease to deal with Daishowa.
After being identified as such, customers are contacted by the defendants who demand that they stop buying Daishowa products. Often, these demands take the form of clear, unequivocal threats of secondary picketing of the customers. Initial contacts, which may be either by telephone or letter, are usually accompanied by written material containing a history of the plight of the Lubicon Band and how certain customers had been persuaded to join the boycott. For example, the written material sent to one customer included an "update" sheet, dated October 1992, that contained the following words:
Despite repeated attempts at a negotiated settlement, FOL was forced to launch a boycott of Pizza Pizza stores in order to force them to give up their Daishowa merchandise. Three months of picketing, leafleting, letters, phone calls, and convincing advertising sources to deny Pizza Pizza ad space, and the Pizza giant gave in. As a result of pressure mounted against them, Pizza Pizza joined the Daishowa boycott, contrary to their earlier statement that they would continue to support Daishowa until "hell freezes over".If the customer does not agree to join the boycott, the defendants subject it to an array of escalating tactics, including leafletting campaigns, fax attacks, press releases and secondary picketing. When such a customer eventually succumbs, the defendants announce their victory in a press release thus making future victims of their tactics aware of the fate that awaits them.
More recently, Bootlegger stores were approached by the Daishowa Boycott Coalition (DBC) in Calgary. When initial negotiations failed, the DBC launched a boycott of Bootlegger stores and backed this up with leafletting actions. FOL joined this boycott and began contacting local outlets to warn them of possible pickets. We also contacted the head office to notify them of our support of the DBC position. Within days Bootlegger did the honourable thing and joined the Daishowa boycott, vehemently disapproving of our tactics but forced by pressure from Alberta and Ontario to ditch Daishowa.
When Pizza Pizza, a customer of Daishowa, after being targeted by the defendants, eventually agreed to buy no further bags from Daishowa, the defendants issued a press release that reads, in part:
The concerted boycott effort mounted by Lubicon supporters in Ontario included a postering campaign, regular leafletting actions in front of Pizza Pizza outlets, and convincing advertising outlets not to carry Pizza Pizza advertising. Pizza Pizza says that while it still doesn't believe Daishowa is doing anything wrong, they say "joining the boycott is the only responsible course of action available" (read: we kicked their butts)When Woolworth joined the boycott, the press release read, in part:
For Immediate Release:Eventually, on January 11, 1995, Daishowa brought an action against the defendants and moved for an interlocutory injunction to prevent their boycott activity. The motion for an interlocutory injunction was dismissed, and that dismissal has been appealed to this court.
WOOLWORTH SURRENDERS TO DAISHOWA BOYCOTT PRESSURE
Toronto Paper Supplier, Omniplast Inc. Loses its Biggest Contract
Succumbing to intense public pressure, the over 1600 stores of Woolworth Canada Inc. have swelled the ranks of the international boycott of Daishowa-Marubeni paper products in support of the Lubicon Cree Nation of northern Alberta to over 4300 stores. With the Woolworth decision, Toronto area paper bag distributor, Omniplast Inc., has been hurt by the loss of its biggest contract. Marc Robitaille of Omniplast Inc., verified to the Friends of the Lubicon (Toronto) that the contracts for the Daishowa paper bags which they were supplying to Woolworth has lapsed and that Woolworth is seeking an alternate bag source.
The Woolworth decision comes after over a half year of public action organized by the Lubicon solidarity network of which Friends of the Lubicon (Toronto) is a part. Actions have included store front pickets, protest phone-in's, fax attacks, a mail campaign, boycott information dissemination and "anything else we could think of to kick their asses".
Before proceeding further, I want to clear away any lesser issues that might otherwise confuse a decision on the main issue, namely, whether or not secondary picketing is illegal per se. Daishowa has complained that the defendants, in their dealings with the press, the public and its customers, accused it of genocide of the Lubicon and of breaking an agreement it is alleged to have made not to harvest timber from the lands in which the Lubicon claim traditional or aboriginal rights. The order of Kiteley J. prohibits the defendants from making any allegation that Daishowa ever made or broke such an agreement and from suggesting Daishowa is guilty of genocide.
The history of the boycott indicates that the defendants threatened Pizza Pizza, a Daishowa customer, that its telephone lines would be jammed on New Year's Eve so as to prevent orders being taken. Such a threat is clearly a threat to perform an illegal act. There is little evidence that the threat was carried out, or indeed that the defendants were capable of carrying it out. Nevertheless, I would amend the order of Kiteley J., if the plaintiff wishes, so as to prohibit the defendants from threatening or doing anything that would prevent the public from placing orders with Daishowa's customers.
The defendants also threatened they would hold a "demonstration" outside a Pizza Pizza franchise. The "demonstration" in fact turned out to be a peaceful picketing by 12 to 15 persons. Nevertheless, I would also amend the order of Kiteley J., if the plaintiff wishes, so as to prohibit the defendants from threatening or doing anything by way of demonstration or picketing that was not peaceful picketing. But the fact that the defendants may have been guilty of unlawful acts that caused Daishowa harm, acts that are now enjoined, is no reason for the court to also enjoin conduct that without those acts is lawful.
I now turn to the main issue, namely, whether secondary picketing is illegal per se.
The grounds for Daishowa's claim for an injunction is captured in that part of the headnote in Rookes v. Barnard,  1 All E.R. 367,  A.C. 1129 (H.L.), which reads:
There is at common law a tort of intimidation by a threat to a person other than the plaintiff to do an unlawful act, made with the intention of damnifying the plaintiff, whereby loss accrues to him, and for the purposes of constituting the tort there is no distinction between a threat to do a tortious act to, and a threat to break a contract with, the person threatened.At pp. 373, 374 and 375 of Rookes v. Barnard, Lord Reid states:
It has often been stated that if people combine to do acts which they know will cause loss to the plaintiff, he can sue if either the object of their conspiracy is unlawful or they use unlawful means to achieve it. In my judgment, to cause such loss by threat to commit a tort against a third person if he does not comply with their demands is to use unlawful means to achieve their object.In Morgan v. Frye,  2 Q.B. 710 at p. 724,  3 All E.R. 452 (C.A.), Lord Denning put the matter as follows:
I can see no difference in principle between a threat to break a contract and a threat to commit a tort....What [the plaintiff] sues for in each case is loss caused to him by the use of an unlawful weapon against him -- intimidation of another person by unlawful means.
Intimidation of any kind appears to me to be highly objectionable. The law was not slow to prevent it when violence and threats of violence were the most effective means. Now that subtler means are at least equally effective I see no reason why the law should have to turn a blind eye to them. We have to tolerate intimidation by means which have been held to be lawful, but there I would stop. Accordingly, I would hold that on the facts found by the jury the respondents' actions in this case were tortious.
According to the decision in Rookes v. Barnard, the tort of intimidation exists, not only in threats of violence, but also in threats to commit a tort or breach of contract. The essential ingredients are these: there must be a threat by one person to use unlawful means (such as violence or a tort or a breach of contract) so as to compel another to obey his wishes; and the person so threatened must comply with the demand rather than risk the threat being carried into execution. In such circumstances the person damnified by the compliance can sue for intimidation.It is obvious then that for Daishowa to succeed on the basis that its customers are being intimidated, it is necessary that it prove that what they are being threatened with is illegal. Daishowa says its customers are being threatened with secondary picketing and such picketing is illegal per se. That allegation requires close scrutiny, for here the defendants are not asking Daishowa's customers to break existing contracts with Daishowa but, rather, not to order more paper bags from Daishowa. Secondary picketing is usually illegal precisely because that picketing is intended to or is likely to induce a breach of contract. Daishowa cannot say that here the secondary picketing is illegal because it is intended to induce a breach of contract; rather, it argues that secondary picketing is always illegal.
In support of that submission, reliance is placed on the following cases:
(1) Hersees of Woodstock Ltd. v. Goldstein,  2 O.R. 81, 38 D.L.R. (2d) 449 (C.A.).Daishowa then is unable to show that the secondary picketing its customers are being threatened with is illegal. Thus, its argument based on the tort of intimidation fails, there being no threat to do an unlawful act.Aylesworth J.A. does state at p. 88 in regard to condemnations of secondary picketing found in various cases that he "view[s] them as declaring secondary picketing to be illegal per se". But it is obvious in so doing that his words are obiter. He had already concluded the picketing was illegal for he said at p. 86:(2) Darrigo's Grape Juice Ltd. v. Masterson,  3 O.R. 772, 21 D.L.R. (3d) 660 (H.C.J.)...appellant had a contract with the Deacon Company; respondents knew of the contract and attempted to induce appellant to break it by picketing his premises; such picketing is a "besetting" of appellant's place of business causing likely to cause damage to appellant; not being "for the purpose only of obtaining or communicating information" the picketing is unlawful...and it ought to be restrainedOnly then did he go on to say:But even assuming that the picketing carrried on by the respondents was lawful in the sense that it was merely peaceful picketing for the purpose only of communicating information, I think it should be restrained. Appellant has a right lawfully to engage in its business of retailing merchandise to the public. In the City of Woodstock where that business is being carried on, the picketing for the reasons already stated, has caused or is likely to cause damage to the appellant. Therefore, the right, if there be such a right, of the respondents to engage in secondary picketing of appellant's premises must give way to appellant's right to trade; the former assuming it to be a legal right, is exercised for the benefit of a particular class only while the latter is a right far more fundamental and of far greater importance, in my view, as one which in its exercise affects and is for the benefit of the community at large. If the law is to serve its purpose then in civil matters just as in matters within the realm of the criminal law, the interests of the community at large must be held to transcend those of the individual or a particular group of individuals.He then goes on to admit he has not found in any of the cases a clear statement that secondary picketing is illegal per se and says that in all the cases where it has been found to be illegal, "the secondary picketing which was the subject-matter under consideration, embraced one or more admittedly unlawful elements such as trespass, intimidation, nuisance or inducement of breach of contract". I conclude therefore that I am not bound by the view of Aylesworth J.A. that secondary picketing is illegal per se, as such view is merely obiter.Keith J. does follow the dicta of Aylesworth J.A. in Hersees and does find secondary picketing to be unlawful per se, stating at pp. 773-74:(3) Retail, Wholesale & Department Store Union, Local 580 v. Dolphin Delivery Ltd.,  2 S.C.R. 573, 33 D.L.R. (4th) 174...one cannot condone their actions in simply defying the law of this country and the law which to me must be the law of the country, namely, that secondary picketing is prohibited and for very sound social reasons which have been set out in many judgments of the Courts of this Province including the judgments of the Court of Appeal to which I have been referred during the course of this argument.Out of comity, I would ordinarily follow the decision in Darrigo's. But I believe that if it was ever the law, it is no longer especially so since the right of freedom of expression has been guaranteed by s. 2(b) of the Canadian Charter of Rights and Freedoms under the Constitution Act, 1982, and in light of more recent decisions. If secondary picketing be illegal per se, then there is no reason for the courts in Canada when dealing with secondary picketing to look, as they do, for some other illegality, such as inducement to breach a contract, before declaring such picketing unlawful.As is stated in the headnote [at p. 574]: "At issue here is whether secondary picketing in a labour dispute is protected as freedom of expression under s. 2(b) of the Charter and accordingly not the proper subject of an injunction to restrain it."
In granting the injunction, later reviewed by the British Columbia Court of Appeal and the Supreme Court of Canada, Sheppard L.J.S.C. stated (see reasons of McIntyre J. at p. 579):...what the Union proposes in picketing the plaintiff applicant is secondary picketing for the purpose either of the tort of inducing breach of contract, or of the tort of civil conspiracy in that the predominant purpose of the picketing is to injure the plaintiff rather than the dissemination of information and the protection of the defendant's interest. Accordingly, I find that the plaintiff is entitled to an injunction to restrain the picketing.In the Court of Appeal, Hutcheon J.A. (see reasons of McIntyre J. at p. 580):...was of the opinion that peaceful picketing is a protected form of expression under the Charter. He was of the view, however, that in so far as the purpose of the picketing was to induce a breach of contract, restraint of such picketing might be a reasonable limit under s. 1. He rejected the application of the tort of civil conspiracy in a labour dispute.McIntyre J., speaking for the majority in the Supreme Court of Canada, says, at p. 588:On the basis of the findings of fact that I have referred to above, it is evident that the purpose of the picketing in this case was to induce a breach of contract between the respondent and Supercourier and thus to exert economic pressure to force it to cease doing business with Supercourier.At p. 589 S.C.R.:The question then is: Can an injunction based on the common law tort of inducing a breach of contract, which has the effect of limiting the Charter right to freedom of expression, be sustained as a reasonable limit imposed by law in the peculiar facts of this case.At p. 603:We have a rule of the common law which renders secondary picketing tortious and subject to injunctive restraint, on the basis that it induces a breach of contract.Wilson J.'s reasons emphasize that what was illegal about the secondary picketing under consideration was that if allowed it would induce a breach of contract. Indeed, she ignores the secondary picketing and speaks only of that which makes it a tort. She states at p. 605:There are, as I see it, two distinct questions which must be answered, namely:The fact that all judges at all levels in Dolphin Delivery dealt with secondary picketing not as being unlawful per se but only unlawful if it constituted some tort, leads me to conclude secondary picketing is not, in the absence of a statute prohibiting it, illegal per se.(1) Does the tort of inducing breach of contract represent a reasonable limit under s. 1 on freedom of expression in the labour relations context? and
(2) If the tort does represent a reasonable limit under s. 1, should injunctive relief be granted in this particular case?
Daishowa also claims that the defendants have committed the tort of wrongful interference with the normal economic and business relations of Daishowa Inc. with its customers. In this regard, we were referred to Gershman v. Manitoba (Vegetable Producers' Marketing Board) (1976), 69 D.L.R. (3d) 114,  4 W.W.R. 406, a decision of the Manitoba Court of Appeal. O'Sullivan J.A. stated at p. 117:
...the learned trial Judge followed the principles set out in Lumley v. Gye, [1843-60] All E.R. Rep. 208, 2 El. & Bl. 216, 118 E.R. 749. In doing so he said [65 D.L.R. (3d) 181 at p. 189,  2 W.W.R. 432] that the tort of interfering in contractual relationships covers not only interference with an existing contractual relationship but also interference where "there was an agreement to enter into a contract".His language suggests that the tort of unlawfully interfering in contractual relationships extends to interference with the formation of such relationships.
The learned trial Judge referred to the dicta of Lord Esher, M.R., in Temperton v. Russell et al.,  1 Q.B. 715 at p. 728:
It seems rather a fine distinction to say that, where a defendant maliciously induces a person not to carry out a contract already made with the plaintiff and so injures the plaintiff, it is actionable, but where he injures the plaintiff by maliciously preventing a person from entering into a contract with the plaintiff, which he would otherwise have entered into, it is not actionable.That language has to be assessed in light of the decisions in the subsequent cases of Allen v. Flood et al.,  A.C. 1, and the Crofter's case, Crofter Hand Woven Harris Tweed Co. Ltd. et al. v. Veitch et at.,  A.C. 435. It is said by Clerk & Lindsell on Torts, 14th ed. (1975), at p. 395, fn. 10:
...the later decisions make it clear that it is not tortious merely to induce one person not to contract with another. There is a "chasm between the legality of that action and the unlawfulness of procuring breachof an existing contract."and at p. 427, para. 808:
...it is now recognised to be a "leading heresy" to believe that spiteful interference with another's trade is in itself actionable when no unlawful means have been threatened or employed.They said that a decision to depart from the principles of Allen v. Flood et al., supra, would "put the legality of trade competition completely into the discretion of the judiciary".
Clerk & Lindsell on Torts, 14th ed. (1975), at pp. 850-51, states:
There exists a tort of uncertain ambit which consists in one person using unlawful means with the object and effect of causing damage to another. In such cases, the plaintiff is availed of a cause of action for this "clearly recognised" but "relatively undeveloped tort," which is different from those so far discussed. For example, in Stratford (J.T.) & Son Ltd. v. Lindley, two of their Lordships gave, as an alternative ground of their decision that an injunction should lie, the fact that the defendants had used unlawful means to interfere with the business of the plaintiffs. "In addition to interfering with existing contracts the respondents' action made it practically impossible for the appellants to do any new business with the barge hirers. It was not disputed that such interference with business is tortious if any unlawful means are employed." Such "interference with business" does not require proof that existing contracts have been broken or interfered with; but the cause of action exists only when the defendant has brought about the damage by use of unlawful means.I conclude therefore that for the tort of wrongful interference with normal economic and business relations to exist, an unlawful means must be threatened or employed. The unlawful means here relied on by Daishowa is the secondary picketing which I have concluded is not unlawful.
Finally, Daishowa claims the defendants are guilty of the tort of conspiracy to injure. In Canada Cement LaFarge Ltd. v. B.C. Lightweight Aggregate,  1 S.C.R. 452 at pp. 471-72, 145 D.L.R. (3d) 385, Estey J. said the tort of conspiracy to injure exists if:
(1) whether the means used by the defendants are lawful or unlawful, the predominant purpose of the defendants' conduct is to cause injury to the plaintiff; or,I have already found that the secondary picketing threatened or carried out that Daishowa wishes to enjoin is not unlawful, so I deal only with the tort of conspiracy to injure by lawful means. For that tort to exist, the predominant purpose of the defendants must be to cause injury to Daishowa. Here it is clear the predominant purpose of the defendants is to help the Lubicon though they hoped to accomplish that purpose by causing economic injury to Daishowa. In Crofter Hand Woven Harris Tweed Co. v. Veitch,  A.C. 435,  1 All E.R. 142, the House of Lords made clear that the predominant purpose is the defendants' overriding and ultimate purpose and that even where that ultimate purpose is selfish self-interest, an allegation of a conspiracy to injure by legal means will fail. Viscount Simon L.C. stated at p. 445:
(2) where the conduct of the defendants is unlawful, the conduct is directed towards the plaintiff (alone or together with others), and the defendants should know in the circumstances that injury to the plaintiff is likely to and does result.
...if there is more than one purpose actuating a combination, liability must depend on ascertaining the predominant purpose. If that predominant purpose is to damage another person and damage results, that is tortious conspiracy. If the predominant purpose is the lawful protection or promotion of any lawful interest of the combiners (no illegal means being employed), it is not a tortious conspiracy, even though it causes damage to another person.And at p. 447:
In the present case, the conclusion, in my opinion, is that the predominant object of the respondents in getting the embargo imposed was to benefit their trade-union members by preventing under-cutting and unregulated competition, and so helping to secure the economic stability of the island industry. The result they aimed at achieving was to create a better basis for collective bargaining, and thus directly to improve wage prospects. A combination with such an object is not unlawful, because the object is the legitimate promotion of the interests of the combiners, and because the damage necessarily inflicted on the appellants is not inflicted by criminal or tortious means and is not "the real purpose" of the combination. I agree with Lord Fleming when he says in his judgment that it is not for a court of law to consider in this connection the expediency or otherwise of a policy adopted by a trade union. Neither can liability be determined by asking whether the damage inflicted to secure the purpose is disproportionately severe: this may throw doubts on the bona fides of the avowed purpose, but once the legitimate purpose is established, and no unlawful means are involved, the quantum of damage is irrelevant.I conclude Daishowa cannot establish the tort of conspiracy to injure.
In the result, on the evidence before us, Daishowa cannot establish any reason why peaceful picketing should be enjoined. Except to the extent the order of Kiteley J. should be amended as indicated above, the appeal should be dismissed.