Consumers today can easily consult a large number of online reviews before deciding where to shop, what to eat or what movie to watch. Review websites exist to provide consumers with opinions about various businesses to help individuals make informed decisions.

The Court of Appeal for Ontario recently considered whether the Better Business Bureau in the Ottawa area (the “BBB”) defamed a local heating and air conditional business by giving it a D- grade online.

In Walsh Energy Inc. v. Better Business Bureau of Ottawa-Hull Incorporated, 2018 ONCA 383, the Court of Appeal found that the D- rating given by the BBB was defamatory in the sense that it would lower the reputation of business in the eyes of a reasonable person. The BBB had developed a new ratings system based on letter grades that replaced an older system that rated business as “satisfactory” or “unsatisfactory” on the basis of customer complaints. Before the new system, the company had an “unsatisfactory” rating. The new system was designed by the BBB’s umbrella organization and used proprietary software to generate the grades based on 17 factors. In finding the D- grade constituted defamation, the Court of Appeal departed from the conclusion of the trial judge who had determined that the rating was not defamatory – it wasn’t clear that a D-was a diminution or an improvement over the company’s old “unsatisfactory” rating.

The Court of Appeal found that the trial judge had focused too closely on the context of the grade and hadn’t considered the plain and ordinary meaning of a D-. As noted by the Court, “Although context may be important in determining whether a statement is defamatory, the plain and ordinary meaning must also be considered.”

In my (potentially unreasonable) opinion, I would give the Court of Appeal an A for its clear analysis of the fair comment defence in this case. It found that the BBB’s online rating of the company was protected and met the following test, as developed by the Supreme Court in WIC Radio v. Simpson, 2008 SCC 40:

  • the comment must be on a matter of public interest;
  • the comment must be based on fact;
  • the comment, though it can include inferences of fact, must be recognizable as comment;
  • the comment must satisfy the following objective test: could any person honestly express that opinion on the proved facts?; and
  • even though the comment satisfies the objective test the defence can be defeated if the plaintiff proves that the defendant was actuated by express malice.

The integrity and customer service record of small businesses was found to be a matter of public interest and a D- grade was comment based on fact and recognizable as such. The case turned on whether the second branch of the test was met, namely whether the facts underlying the opinion were “sufficiently stated or otherwise […] known to the listeners”, or in this case the readers, to allow them to make up their own minds about the opinion. If there is a factual foundation for an opinion “there is no requirement that the opinion be reasonable”.

Here, the facts about the BBB’s rating system were known. The website identified information about the process for assigning letter grades and a single refusal to address a customer complaint through the BBB process could result in a D- rating (as happened here).

Further, the Court considered whether a person could honestly express the opinion – in this case giving the company a D- grade – based on the proved facts. In the Court’s view, while the D- grade was harsh, it met the test. It does not matter whether a person actually holds the opinion expressed, only that the opinion could honestly be held and has a basis in the facts. Opinions can sometimes be harsh or unreasonable but our law still protects them.

Julia Lefebvre is an associate at Bersenas Jacobsen Chouest Thomson Blackburn with a focus on media and defamation law.