Khan v Khan, 2015 ONSC 1847

By O’Connor J.
Ontario Superior Court
Mar 20, 2015

B E T W E E N:

CHAUDHRY KHAN,  Ashwani K. Datt, for the Plaintiff

- and -

 

RAZA KHAN,  Christina Bowman and Jitesh Bhalla, for the Defendant

HEARD:  September 22, 23, 24, 25, 2014

 

O’CONNOR J.

 

[1]           The plaintiff, Liaqat Chaudhry, and the defendant, Raza Khan, were friends and partners in a Pakistani restaurant business in Mississauga, called 5 Star Haveilly, until they had a falling out in 2005.  They met several times to discuss their problems.  Chaudhry says Khan refused to pay his share of the business expenses, that he wished to continue as a partner without making any contribution to running the restaurant, and that he wished to continue eating at the restaurant without paying for his meals.  He even wished the business to pay his costs for a trip to Saudi Arabia.

[2]           Chaudhry says that Khan threatened him with words such as “You are going to have big problems” and “you will pay for that.”

[3]           In 2007, Khan reported to the Peel Region Police that Chaudhry had threatened to burn down his house.  On October 17, 2004, Chaudhry was arrested and charged with conspiracy to commit arson.  It was alleged he had tried to hire a third party to commit the arson.  He was held in custody for three days before being released on bail.  His bail terms included posting a bond of $100,000 and required that he have no contact with Khan or the restaurant, in which Khan still claimed a half interest.  He was not permitted to leave his home unless accompanied by his surety.  As a result, the business failed in 2011 and Chaudhry had to sell his house to survive.  His health and his reputation in the Pakistani community suffered.

[4]           The criminal charge proceeded through the justice system.  However, on November 5, 2008, after over a year, the charge against Chaudhry was withdrawn at the preliminary hearing.

[5]           Chaudhry commenced this action seeking damages from Khan for malicious prosecution, claiming that the circumstances of the charges being commenced against him and the resolution of the matter in his favour satisfy the four elements a plaintiff must prove to succeed in a malicious prosecution action.

LAW AND ANALYSIS

 [6]           In order to succeed in establishing the tort of malicious prosecution, the plaintiff must establish four elements. These were set out by the Supreme Court of Canada in Miazga v. Kvello Estate2009 SCC 51 (CanLII) [Miazga] at para 3:

[A] plaintiff must prove that the prosecution was: (1) initiated by the defendant; (2) terminated in favour of the plaintiff; (3) undertaken without reasonable and probable cause; and (4) motivated by malice or a primary purpose other than that of carrying the law into effect.

 

[7]           The onus is on the plaintiff to prove all four elements of the test on a balance of probabilities (Brummell v. Williams2014 ONSC 5733 (CanLII) at para. 11Mirra v. Toronto Dominion Bank[2004] O.J. No. 1804 at para. 25Su v. Chowdhury2014 ONSC 5730 (CanLII), at para. 18).

[8]           The plaintiff’s burden is a difficult one to meet. This was recognized by the Supreme Court of Canada in Nelles v. Ontario,1989 CanLii 77 (SCC)[1989] 2 S.C.R. 170, at para 47:

A plaintiff bringing a claim for malicious prosecution has no easy task. Not only does the plaintiff have the notoriously difficult task of establishing a negative, that is the absence of reasonable and probable cause, but he is held to a very high standard of proof to avoid a non-suit or directed verdict.

 

[9]           In Correia v. Canac Kitchens, 2997 CanLii 691 (ONSC), at para 75, reversed on other grounds, 2008 ONCA 506 (CanLII), Low J. further explained the difficulty in establishing this tort, and the public interest rationale that underlies this difficulty:

 

 It is often observed that the bar is set very high in a claim of malicious prosecution and that a plaintiff has very difficult burden to meet to make out the claim. It is in the public interest that this be the case because criminal prosecutions are brought not for the benefit of the prosecutor nor for the benefit of the complainant but rather for the common welfare of society. Second, because the standard of proof is very high in a criminal prosecution, there will be many prosecutions brought that do not succeed not because the charge is unfounded but because the standard of proof has not been met. That the threshold for success is high in an action of malicious prosecution therefore balances the public interest in bringing to justice persons who may have broken the law against the private interest of persons who have been wrongfully prosecuted without reasonable grounds and for oblique or improper motives.

 

[10]       I will review each element of the tort of malicious prosecution in order.

1.     Whether the prosecution was initiated by the defendant

 

[11]       Under the first element of the test for malicious prosecution, the plaintiff must establish that:

[T]he prosecution at issue was initiated by the defendant. This element identifies the proper target of that suit, as it is only those who were “actively instrumental” in setting the law in motion that may be held accountable for any damage that results [citation omitted] (Miazga at para. 53).

 [12]                         The first question that arises at this stage is under what circumstances a non-stage agent, such as Chaudhry, can be found to be the prosecutor. The general rule is that the police are treated as a prosecutor, and the court will consider the police officer who laid the charge as the person who set the prosecution in motion (Harrison v. Wicro Products2011 ONSC 1049 (CanLII), at para 8 [Harrison]; Kefeli v. Centennial College of Applied Arts and Technology[2002] O.J. No. 3023 (C.A.) at para. 24 [Kefeli])

 [13]                         However, in exceptional circumstances, a private citizen may be treated as the prosecutor. This may arise where:

a)     the complainant desired and intended that the plaintiff be prosecuted;

b)   the facts were so peculiarly within the complainant's knowledge that it was virtually impossible for the professional prosecutor to exercise any independent discretion or judgment; or if the complainant puts the police in possession of information which virtually compels an officer to lay an information; and

c)     the complainant procured the initiation of proceedings by the professional prosecutor, either by furnishing information which he knew to be false, or by withholding information which he knew to be true, or both (Kefeli at para 24; see also Harrison at para 8; and Mirra v. Toronto Dominion Bank, [2004] O.J. No. 1804[2004] O.T.C. 365 (S.C.J.) at para. 35).

 

[14]                         On the last point, the complainant’s deceit must be intended for the purpose of procuring a prosecution against the plaintiff (St. Jacques v. Doyle[2008] O.J. No. 914165 A.C.W.S. (3d) 69 (S.C.J. Div. Ct.) at para 17).

 Application to this Case

  

[15]                         In this case, I am easily satisfied that Khan desired and intended that Chaudhry be prosecuted. He went to the authorities with incriminating information that Chaudhry had threatened to burn down his house.

[16]                         The important question is whether, despite Khan having furnished the relevant information to the authorities, the prosecution was nonetheless initiated as a result of independent discretion on the part of the authorities. In this regard, the evidence of officer Sebastian Cuoco (“Cuoco”), the investigating officer, is crucial. Cuoco testified that:

a)     the decision to charge Chaudhry was that of police;

b)   Cuoco exercised his own independent discretion to charge Chaudhry;

c)     Khan did not specifically ask police to charge Chaudhry;

d)   Khan did not subvert the police investigation in any way;

e)     Khan did not place any pressure on Cuoco with respect to investigating or charging Chaudhry;

f)      Khan did not deceive Cuoco in any way;

g)     Through the course of his investigation, Couco did not discover any evidence concealed by Khan;

h)   Nobody on behalf of Khan attempted, obstructed, interfered, or persuaded Cuoco to charge Chaudhry;

i)      The Defendant did not obstruct or influence the investigation in any way;

j)      During Cuoco’s investigation, he examined witnesses, namely, Ziad Anwar, Nabeel Khan, Faisal Malik, and Arifa Dar;

k)   Ziad Anwar was the main witness for the prosecution; and

l)      After examining these witnesses, Cuoco reasonably believed that there were reasonable and probable grounds that the offence had been committed by Chaudhry.

 

[17]                         The evidence of officer Cuoco, which was uncontradicted on cross-examination, indicates that Khan did not intend to deceive the police, either by omission or commission, regarding the nature of the allegations against Chaudhry. Further, and importantly, Cuoco’s evidence clearly establishes that the police conducted an independent investigation before deciding whether to lay a charge against Chaudhry.  

[18]                         I agree with Khan’s position that the “but for” threshold advanced by Chaudhry is insufficient to establish this prong of the test. While it is true that the prosecution would not have been initiated but for Khan’s complaint to the police, the evidence shows that the decision to initiate the prosecution was nonetheless within the discretion of, and exercised by, the police in this case.

[19]                         Therefore, Chaudhry has failed to prove the first element of the test on a balance of probabilities.

[20]                         In light of the fact that all four elements of the test must be met in order for the plaintiff to succeed, a finding that any one element has not been made out is sufficient to find that Chaudhry has failed to establish the tort of malicious prosecution. Nonetheless, I will proceed to consider the remaining three elements of the test.

2.     Whether the proceeding was terminated in favour of the plaintiff

  

[21]                         The second element of the test was explained by the Supreme Court of Canada in Miazga as follows:

54        The second element of the tort demands evidence that the prosecution terminated in the plaintiff's favour. This requirement precludes a collateral attack on a conviction properly rendered by a criminal court, and thus avoids conflict between civil and criminal justice. The favourable termination requirement may be satisfied no matter the route by which the proceedings conclude in the plaintiff's favour, whether it be an acquittal, a discharge at a preliminary hearing, a withdrawal, or a stay.

 

 [22]                         Although the favourable termination requirement may be satisfied “no matter the route by which the proceedings conclude in the plaintiff’s favour,” this is tempered by the fact that:

 

54        …[W]here the termination does not result from an adjudication on the merits, for example, in the case of a settlement or plea bargain, a live issue may arise [as to] whether the termination of the proceedings was "in favour" of the plaintiff.

 

[23]                         Some cases have held that a prosecution is not terminated in favour of an accused person where the charges are withdrawn after s/he enters into a peace bond or agrees to some other remedial condition or quid pro quoBond v. Ontario, [2002] O.J. No. 3499 (Ont. S.C.J.) at para 26; see also Hunt v. Ontario[2004] O.J. No. 5284 (Ont. S.C.J.).

[24]                         In Ferri v. Root (2007), 2007 ONCA 79 (CanLII)279 D.L.R. (4th) 643 (Ont. C.A.) the Ontario Court of Appeal held that, in order to properly determine whether the proceedings terminated in favour of the accused, the courts must carefully examine negotiated resolution agreements in order to understand the underlying reasons for such settlements (paras 53-54).

Application to this Case

  

[25]                         In this case, the charges were withdrawn at the preliminary hearing stage at the request of the Crown. The exact reasons for this are unclear, however. Chaudhry did not produce the transcripts of the hearing of November 5, 2008, in which the Crown withdrew the charges against him.

[26]                         Khan submits that an adverse inference should be drawn against Chaudhry for him failing to adduce evidence as to why the charges were withdrawn.

[27]                         However, Cuoco’s evidence at trial was that the charges were withdrawn because the main witness for the prosecution, Ziad Anwar, did not testify in a manner consistent with his statement to the police. This testimony is the only evidence on this point, and it is not challenged by Khan. Further, there is no evidence, nor even any suggestion, that the charges were withdrawn in exchange for any remedial action to be taken by Chaudhry.

[28]                         Therefore, I am satisfied that Chaudhry has established on a balance of probabilities that the proceedings were terminated in his favour.

3.     Whether there was an absence of reasonable and probable cause

  

[29]                         The third element of the test of malicious prosecution requires the plaintiff to prove an absence of reasonable and probable cause for initiating or continuing the prosecution. The Supreme Court of Canada explained this further in Miazga as follows:

 

58       …Since malicious prosecution is an intentional tort that targets a prosecutor's decision to initiate criminal proceedings, this element is generally couched in terms of the prosecutor's belief in the existence of reasonable and probable cause. It is well established that the reasonable and probable cause inquiry comprises both a subjective and an objective component, such that for grounds to exist, "[t]here must be both actual belief on the part of the prosecutor and that belief must be reasonable in the circumstances" (Nelles at p. 193). Although stated in the affirmative, the onus is clearly on the plaintiff to prove the absence of reasonable and probable cause (emphasis in original).

 

[30]                         Importantly, where the ‘prosecutor’ in issue is a private person and not a public prosecutor, this element of the test may be established on the basis of a subjective belief alone, regardless of the actual facts, on the part of the private prosecutor (Miazga at para 72). This is in contrast to the case of a public prosecutor, whose lack of subjective belief will not be determinative of the third element where objective reasonable grounds nonetheless do exist. The Supreme Court said in Miazga:  

73        …Unlike the situation in a purely private dispute, the public interest is engaged in a public prosecution and the Crown attorney is duty-bound to act solely in the public interest in making the decision whether to initiate or continue a prosecution. Consequently, where objective reasonable grounds did in fact exist at the relevant time, it cannot be said that the criminal process was wrongfully invoked. Further… the decision to initiate or continue the prosecution may not entirely accord with the individual prosecutor's personal views about a case as Crown counsel must take care not to substitute his or her own views for that of the judge or the jury. Therefore, in the context of a public prosecution, the third element of the test necessarily turns on an objective assessment of the existence of sufficient cause.

 [31]                         A subjective belief on behalf of the private prosecutor is critical, therefore, because, unlike a public prosecutor, the private prosecutor is not charged with any public duty, and has no reason to invoke criminal process against an individual in the absence of the requisite subjective belief. The private prosecutor must have an honest belief in the guilt of the accused, and his intention may be to protect his own or the public interest (Oniel v. Marks, 2001 CanLii 24091 (Ont. C.A.) at paras 40, 43).

[32]                         It must also be noted that, in analyzing this factor, the court must be mindful of the general idiom that hindsight is 20/20. In Miazga, the Supreme Court of Canada said:

76      In carrying out the objective assessment, care must be taken in retroactively reviewing the facts actually known to the prosecutor at the relevant time — that is, when the decision to initiate or continue the proceeding was made. The reviewing court must be mindful that many aspects of a case only come to light during the course of a trial: witnesses may not testify in accordance with their earlier statements; weaknesses in the evidence may be revealed during cross-examination; scientific evidence may be proved faulty; or defence evidence may shed an entirely different light on the circumstances as they were known at the time process was initiated.

 

[33]                         Finally, where reasonable and probable cause existed to initiate or continue the prosecution, the proceedings must be taken to have been properly instituted, regardless of the fact that they may have ultimately resolved in favour of the accused (Miazga, paras 55 and 75).

Application to this Case

  

[34]                         In this case, Chaudhry argues that Khan lied to the police in order to obtain an advantage in the parties’ business dispute over the ownership of the restaurant owned by Chaudhry’s wife and Khan. Chaudhry points to the following facts as undermining Khan’s alleged fear of Chaudhry:

        The parties have known each other since the early 1990s, and have done business together;

        Khan went around the community seeking a meeting with Chaudhry to resolve their business differences, and only went to the police after he failed to resolve these differences;

        Khan testified that he wanted to meet Chaudhry in person to resolve their business dispute after the alleged fear arose;

        Chaudhry gave uncontradicted evidence at trial that Khan made threats to him on two occasions in relation to the business dispute;

        Khan admitted during his examination for discovery that what he really wanted to do was embarrass Chaudhry;

        Khan admitted during cross-examinations in discovery that he told police that he felt cheated by Chaudhry in their business dealings, and that he (Khan) was claiming a 50% share in their restaurant business;

        Khan admitted during his discovery that he previously told Chaudhry that, if Chaudhry tried to sell the restaurant, he would go to the police to try and stop him; and further that he knew Chaudhry was attempting to sell the restaurant before he went to the police;

        Khan initiated a court action for the restaurant a few weeks after Chaudhry was charged by the police; and

        After Chaudhry was barred from attending the restaurant because of his bail conditions, Khan immediately initiated attempts to manage the business. 

 

[35]                         Khan testified as to his reason for believing the accused threatened him. He received a note in his residence mail box with a phone number on it and a message asking him to contact that number. He called that number and met with Ziad Anwar, who was the person that left the note. Anwar allegedly told Khan that Chaudhry and his nephew, Akmal Choudhary, attempted to recruit him to burn down Khan’s house.

[36]                         Khan was also well aware of the fact that both parties were embroiled in a business dispute over the restaurant, and the fact that Chaudhry had previously accused the Defendant of burning his property. This evidence was not contradicted by Chaudhry. Both Khan and Cuoco believed these factors furnished Chaudhry with motive to follow through on his threats.

[37]                         On this basis, Khan submits that he had reasonable and probable cause to lay the information to the police, as he was concerned about his and his family’s safety.

[38]                         Weighing all of the evidence, I am not satisfied that Chaudhry has established this element on a balance of probabilities. Chaudhry’s submissions certainly indicate that Khan may have been motivated in part by financial reasons. But that is not the issue at this stage of the inquiry. The question is whether Khan nonetheless subjectively had reasonable and probable grounds to believe that Chaudhry had uttered threats to have his house burned down.

[39]                         The evidence is that the alleged threats arose in the context a business dispute between the parties. The dispute beganbefore the threats and continued after it. It is logical, therefore, that the actions of both parties, both before and after the threats, were affected by financial considerations and a level of animus between the parties. One might question, for example, why Chaudhry chose only to sue Khan, and not the Crown, Cuoco, Peel Regional Police, or Anwar, the main witness for the prosecution.  Nonetheless, with this context in mind, the defendant’s actions - attempting to resolve the business dispute with Chaudhry; sharing details of the business dispute with the police; beginning to manage the restaurant after the Plaintiff was prohibited from doing so; and initiating a legal proceeding to take over for the restaurant – are in no way inconsistent with Khan’s evidence that he received and believed the threats in question.

[40]                         Chaudhry, in his written submissions and affidavit, does not deny the threats, nor does he question the credibility or reliability of Ziad Anwar, who informed Khan of the threats.

[41]                         Further, while the court must be cautious in retroactively reviewing the facts, it is noteworthy that Chaudhry’s nephew, Akmal Choudhary, who Khan incriminated together with Chaudhry in his allegations, was committed to trial on the matter and ultimately entered into some form of resolution with the Crown. This indicates that Khan’s fear was not unfounded.

[42]                         I would not find, therefore,  that Chaudhry has proven on a balance of probabilities that Khan had no subjective belief that there was reasonable and probable cause to submit the allegations to the police.

4 – Whether the prosecution was initiated with a malicious intent

  

[43]                         The fourth and final element of the tort considers whether the prosecutor was fuelled by malice. To establish malice, the plaintiff must show more than recklessness or gross negligence (Miazga at para 80). This was explained in greater detail inJacques v. Doyle[2008] O.J. No. 914165 A.C.W.S. (3d) 69:

9.         …The test for malicious prosecution requires that the plaintiff show that the actual motive was improper, or demonstrate that the prosecution can only be explained by imputing a wrong motive. Neither bald allegations of malice, nor inferences in the face of other explanations, nor assumption and innuendo will satisfy the elements of the test (emphasis in original).

 

 [44]                         The malice element has a wider meaning than spite, ill-will, or revenge; it can be made out where the plaintiff shows that the prosecutor was compelled by an improper purpose (Miazga at para 78; Oniel v. Marks2001 CanLII 24091 (ON CA)141 O.A.C. 20180 C.R. (2d) 90 (Ont. C.A.))

[45]                         Undoubtedly, the malice requirement is a high threshold to meet. The requirement is designed to strike a balance “between society's interest in the effective administration of criminal justice and the need to compensate individuals who have been wrongly prosecuted for a primary purpose other than that of carrying the law into effect” (Miazga at para. 56).

Application to this Case

  

[46]                         Chaudhry’s position is that Khan lied to the police in order to obtain revenge and to gain an advantage in the business dispute between the parties. He relies on the facts listed under the third element above to establish that Khan had an improper purpose.

[47]                         Khan emphasizes the fact that Anwar was the prosecution’s main witness, and that it was on the basis of his sworn statement that the police decided to charge Chaudhry. Khan also points to the fact that Cuoco testified that, during his investigation, he did not sense any malice on the part of Khan towards Chaudhry, and that the business dispute between the parties did not play any role in Khan making his complaint to the police.

[48]                         Having found that Khan laid the allegations based on reasonable and probable cause that Chaudhry had threatened him, I am not satisfied that Khan proceeded on the basis of a malicious intent or for an improper purpose. As noted above, both parties were locked in a business dispute and both parties were affected by financial considerations and a certain level of animus. In the end, however, Chaudhry’s reliance on a business dispute between the parties is insufficient to prove, on a balance of probabilities, this final prong of the test.  

CONCLUSION

[49]                         Chaudhry has not proven the tort of malicious prosecution on a balance of probabilities. While the criminal proceedings initiated against him as a result of Khan’s allegations were resolved in his favour, Chaudhry has not demonstrated that the prosecution was initiated by Khan, that Khan lacked reasonable and probable cause, or that Khan possessed a malicious intent. 

 COSTS

 [50]                         Unless agreed to between the parties, they shall make their costs submissions to the Court within 10 days of this date. Such submissions are to be limited to five double-spaced pages, except for their Bills of Costs and supporting cases.

___________________________

O’CONNOR J.

 

 Released:    March 20, 2015