The New Brunswick Court of Appeal split in answering the question of whether the disciplinary arm of a professional self-regulating body could be sued and found liable for malicious prosecution, in the recent decision of New Brunswick Real Estate Association v Estabrooks, 2014 NBCA 48. The majority’s answer was no, but the dissent said yes. It may ultimately fall to the Supreme Court of Canada to resolve the issue, which is one that Canadian courts have debated for years.

Background facts

(The facts of Estabrooks are set out in paras 3-11 of the majority decision and paras 75-80 of the dissent.)

The plaintiff was the president of the New Brunswick Real Estate Association, a professional governing body with a disciplinary scheme provided in its governing statute. The complainant was a board member of the Association and also chair of the finance committee. His letter to the registrar / executive director of the Association alleged two heads of misconduct: First, that the plaintiff had posted confidential financial information about the Association on his personal website and refused to remove it upon the complainant’s demand (which had also been the subject of an earlier letter from the complainant to the registrar); and second, that the plaintiff had not followed the complainant’s request that he provide an apology letter after suggesting that another board member was in a conflict of interest over a separate matter.

The plaintiff had apparently had disagreements with the complainant and the registrar in the past. Interestingly, these particular allegations were formally submitted the day after the plaintiff had suggested to the registrar that the complainant may have made a dubious expense claim. The registrar referred the complaint to the Association’s Complaints Committee (which she had not done for the complainant’s earlier letter about the website issue). The Complaints Committee forwarded the apology letter allegation to the Discipline Committee, which subsequently found that the plaintiff had committed professional misconduct.

The plaintiff successfully appealed this decision to the Court of Queen’s Bench, and several years later he sued the Association for malicious prosecution. He was successful at trial, and the Association appealed.

The Association raised as its first ground of appeal the fact that 105 of the 167 paragraphs in the trial judge’s decision had been “cut and pasted” from the parties’ briefs, indicating a lack of independence and impartiality. But apart from reminding trial judges of the Supreme Court’s instructions on writing original reasons in Cojocaru v British Columbia Women’s Hospital and Health Centre, 2013 SCC 30, [2013] 2 SCR 357, Justice Larlee (with Justice Robertson concurring) did not allow the appeal on that basis and focused instead on the substantive law of malicious prosecution (see paras 11-15).

The test for malicious prosecution

Justice Lamer (as he then was) listed the four elements of malicious prosecution in Nelles v Ontario, [1989] 2 SCR 170 at 193:

a) the proceedings must have been initiated by the defendant;

b) the proceedings must have terminated in favour of the plaintiff;

c) the absence of reasonable and probable cause;

d) malice, or a primary purpose other than that of carrying the law into effect.

A plaintiff must also prove damage (Estabrooks at para 24).

The title of the tort—malicious prosecution—suggests that it is most easily understood when the prior proceedings were criminal. That was the context in Nelles, where the Supreme Court held that attorneys general and Crown prosecutors could not be immune from malicious prosecution claims. (See paragraphs 20-22 of Estabrooks for an overview of Nelles.)  But outside of allegedly maliciouscriminal prosecutions, the scope of malicious prosecution has not been as clear.

Justice Larlee for the majority in Estabrooks took a limited view of the tort’s boundaries, stating at para 25: “While the availability of the tort of malicious prosecution was somewhat expanded by Nelles, it remains largely restricted to cases involving criminal prosecutions.” (Emphasis added.) She decided against extending the tort to professional disciplinary bodies:

[40] … I am not convinced that the law in Canada is now settled such that professional disciplinary bodies and individuals who initiate proceedings before such bodies do not have immunity from suits for malicious prosecution. … while I agree that the provincial self-regulating disciplinary bodies, like Crown prosecutors, should not be given an absolute immunity from tortious liability for misuse of their power, that tortious liability should not be framed in malicious prosecution.

Justice Larlee, in obiter, went on to apply the Nelles test in case she was wrong about the extent of malicious prosecution where a professional disciplinary proceeding is involved, but noted that the test itself was an awkward fit on the facts: “This is because the process begins in a disciplinary procedure before a provincial self-regulating professional body by the receipt of a written complaint by a member of the Association or a member of the public – not a Crown actor” (para 48).

According to Justice Larlee, the first and fourth elements of the Nelles test could not be met on the facts. First, the proceedings were not initiated by the defendant Association, and once the registrar received the complaint from the member, she had virtually no discretion to dismiss it so had to forward it to the Complaints Committee (paras 59-61). On the final element, the plaintiff had not properly proved malice; “conflicting relationships” with the complainant and registrar, and “spiteful or vengeful behavior” against him, would not suffice (para 69).

Justice Larlee concluded (with emphasis added):

[72]     To summarize, if one looks at the context, this was a relatively minor complaint that dealt with one act of alleged misconduct: Mr. Estabrooks failed to write a letter of apology. The caselaw speaks of who initiated the prosecution: there was no prosecution here; the process was begun by the receipt by the Registrar of a written complaint from an individual member. The Registrar then had to act within the statutory framework and refer the complaint to the Complaints Committee. The Complaints Committee here, again in accordance with the Act, is not required to hold a hearing or give anybody the right to make oral submissions but to make a preliminary evaluation, to consider and investigate the conduct or competence of a member. This was not a quasi-criminal inquiry; it was an inquiry by the Discipline Committee into the conduct of a member. No improper purpose has been identified and malice has not been proved.  In any case, there is no evidence that Mr. Estabrooks suffered any actual damage. The failure of Mr. Estabrooks to plead vicarious liability and the errors the trial judge made with respect to the application of the Nelles test all lead me to the conclusion that even if the tort of malicious prosecution can be said to apply to professional disciplinary proceedings, liability has not been established on the facts: no tortious conduct can be attributed to the NBREA.

Three points of disagreement between majority and dissent

There are three key points of departure between the majority and the dissent that are worth exploring in more detail.

1. Precedent

The majority chose to rely on decisions of the House of Lords and Privy Council—which the parties had not cited—rather than cases from other Canadian courts that had permitted malicious prosecution claims arising from disciplinary proceedings. (See para 41.) Justice Larlee for the majority found particular support in Gregory v Portsmouth City Council, [2000] UKHL 3 where Lord Steyn refused to expand malicious prosecution to cover disciplinary proceedings brought by a local authority against a city councillor. Lord Steyn in Gregory made an obiter comment that there was “a stronger case” for extending the tort to civil proceedings than to disciplinary proceedings, but concluded that other torts, including defamation and misfeasance in public office, were sufficient to capture the kind of conduct at issue without extending malicious prosecution.

Crawford Adjusters v Sagicor General Insurance (Cayman) Limited, [2013] UKPC 17—and particularly Lord Sumption’s dissent—also influenced Justice Larlee’s conclusion. (See Estabrooks at paras 43-47.) Whilst the majority in Crawford was willing to consider malicious prosecution where the prior proceedings were civil, Lord Sumption was not. Justice Larlee agreed with Lord Sumption that malicious prosecution “makes no sense in cases” where there is no public prosecution or its equivalent, and expressed similar reluctance to enlarge the scope of a tort when there could be unforeseen practical consequences.

For his part, Justice Bell in dissent in Estabrooks preferred to follow the Canadian cases accepting that disciplinary proceedings could ground a claim for malicious prosecution:

[81]     As outlined by my colleagues, at least three Canadian courts clothed with appellate jurisdiction have concluded that the tort of malicious prosecution is available to those who find themselves maliciously prosecuted by self-regulatory disciplinary bodies: Stoffman; Khanna v. Royal College of Dental Surgeons of Ontario, [2000] O.J. No. 946 (C.A.) (QL), leave to appeal to S.C.C. refused, [2000] S.C.C.A. No. 244; and, Griffin v. Summerside (City), 2008 PESCAD 14, [2008] P.E.I.J. No. 46 (QL), leave to appeal to S.C.C. refused, [2009] S.C.C.A. No. 45. In addition to those appellate jurisdictions, as noted by the majority, superior courts of first instance in Manitoba, Ontario, Nova Scotia and the Northwest Territories have acknowledged the possibility of a claim in malicious prosecution in such cases. I find that approach embraces the view of a legal system that is responsive to the changing realities of our society, that refuses to pigeon-hole remedies and procedures available to the public, and that responds with appropriate caution to the invitation by the Court in Nelles v. Ontario, [1989] 2 S.C.R. 170, [1989] S.C.J. No. 86 (QL) for increased access to justice through more accessible tort relief.

[emphasis added]

To briefly recap the three leading cases cited in this passage: The Court in Stoffman
v Ontario Veterinary Association
, 1990 CanLII 6925 (H Ct J (Div Ct)) held that the disciplinary panel of a professional association—there, the Ontario Veterinary Association—would not be immune from a lawsuit for malicious prosecution. In Khanna (also available at 2000 CanLII 5167) the Ontario Court of Appeal permitted a malicious prosecution claim against the lawyer representing the Ontario Royal College of Dental Surgeons in a disciplinary hearing to proceed despite its “novel” nature. Finally, in Griffin, the majority stated (at para 12) that it was “now well settled that professional disciplinary bodies and individuals with the authority to initiate proceedings before such bodies do not have immunity from suits for malicious prosecution.”

The majority in Estabrooks had reviewed these cases but did not follow them, finding that they were not binding, and not as persuasive asGregory and the dissent in Crawford (para 40).

2. Policy

The majority offered several policy reasons against widening the tort of malicious prosecution (para 48):

The policy concerns I have are: the resulting prolongation in litigation which cannot benefit any association or its members, the fact that malice is easy to allege but difficult to prove in this context, and, finally, and more practically, these complaint and disciplinary committees are frequently made up of volunteer members who give their time pro bono to the associations. How willing would they be to act if they knew they might have to defend themselves against a malicious prosecution suit?

But according to the dissent, the tort carries with it sufficient safeguards to ensure volunteers would still be willing to act; and, whether or not malicious prosecution is available, the members of disciplinary bodies could still be subject to liability for other torts (see para 82). Justice Bell concluded (at para 83): “The tort of malicious prosecution is but one tool available to ensure the disciplinary police are themselves policed. Unlike my colleagues, I am of the view the benefits of the availability of that tool exceed any impediments that might arise.”

3. Pleadings

The whole Court agreed that any liability of the Association would be vicarious (see para 84), but disagreed as to whether the pleadings were sufficient in this respect. For the majority, the pleadings had two fatal flaws: The plaintiff had not specifically pleaded vicarious liability, and he had not “named names” of the particular individuals whose malice led to the disciplinary proceedings (see paras 40 and 50-57). For the dissent, however, ”the failure to specifically plead vicarious liability and the failure to name another defendant did not negatively impact the conduct of the trial or the decision reached” (para 87).


The majority decision in Estabrooks will be a good precedent for professional regulatory bodies sued for malicious prosecution based on disciplinary proceedings that turned out to be unfounded – and for counsel and litigants urging a cautious approach to the expansion of any contested tort. But as the dissent points out, there is now a conflict in the Canadian case law on malicious prosecution. It might take a trip to the Supreme Court of Canada to settle the dispute.