SCIENTOLOGY HISTORY IN TORONTO, PART FIVE
Canada's Largest Libel Award
After the police raid on its headquarters in Toronto, the Church of
Scientology decided to destroy the reputation of Casey Hill, the Crown
Attorney who was preparing the case for the prosecution. False allegations
of contempt of court were prepared. Appearing on the steps of
Osgoode Hall (Appeal Court) in his barrister's robes, lawyer Morris Manning
announced to a press conference that his client, the Church of
Scientology, was bringing contempt charges against Hill for allegedly
misleading a judge and breaching a court order sealing seized documents.
The contempt charges were later dismissed by a judge, and Hill sued the
church for libel. Hill's lawyers met with the church's lawyers before the
libel trial and offered to settle for $50,000, but the church refused. The
jury trial ending October 3rd, 1991 awarded general damages of
$300,000 against Scientology and lawyer Morris Manning. The jury also
awarded $500,000 in aggravated damages against Scientology, and a
further $800,000 in punitive damages against Scientology, for a total of
The Church of Scientology appealed the size of the award, and on March
11th, 1992, Mr. Justice Douglas Carruthers decided that the church
should pay pre-judgement interest at the rate of 10% since 1985,
effectively adding $500,000 more to the award. He also issued a permanent
injunction against church officials from making defamatory statements about
When a lawyer for Mr. Hill, Robert Armstrong, attempted to collect, he
found that the Church's offices, with an appraised value of $6 million, had
been mortgaged to the Church of Scientology of California within weeks of
the judgement. The cash from the mortgages had ostenstibly been used
to pay legal fees. A payment of $3.1 million was shown to the law firm of
Clayton Ruby, although $2.1 million of that was not owed at that time.
Armstrong asserted that the church's property was essentially debt-free
before the trial, but within weeks it had three mortgages registered
it for $10 million.
The Church appealed to the Ontario Court of Appeal and in a unanimous
judgement on May 10, 1994, the court found in favour of Mr. Hill. The
three-judge panel was severely critical of the church's conduct, calling it
"character assassination" and noting that Scientology kept an internal file
on Hill, identifying him as "Enemy Canada" - a category reserved for the
"Scientology decided that Casey Hill was the enemy and it set out to
destroy him", the court said in its 129 page judgement. "It levelled false
charges against him. It prosecuted him on those charges ... In summary, the
evidence suggests that Scientology set upon a persistent course of
character assassination over a period of seven years with the intention of
destroying Casey Hill."
Although the church knew within 10 days of the Osgoode Hall news conference
that some of its allegations were untrue, it continued to defend
them as justified right up to the start of the appeal.
Mr. Justice W. David Griffiths wrote that the appeal court had reviewed the
evidence and found that it was sufficient to find "malice and egregious
conduct on the part of Scientology". The malice alone was sufficient to
merit the punitive damage award, the judgement said, and "what seemed to
be of overriding importance was the need for specific deterrence of
Scientology to prevent it from repeating its libel."
Scientology was not easily deterred, the appeal court judges said. It not
only published the libel when there was no evidence to support the
allegations but continued its unfounded proceedings against Mr. Hill when
it knew the principal allegation was untrue. It also made allegations that
knew were untrue in documents it submitted to court.
1.Globe and Mail, May 11, 1994, p. A3. "1.6-million award upheld in
appeal: Court rules Church of Scientology 'set out to destroy'
2.Globe and Mail. November 26, 1992, p. A10. "Scientologist's offices
mortgaged, court told: church accused of trying to make Toronto
3.Toronto Star, May 13, 1994, p. A14. "1.6m libel case settlement is
4.Toronto Star, March 12, 1992, p. D26. "Judge adds $500,000 to record
5.Globe and Mail, October 5, 1991, p. A9. "Lawyer awarded $1.6m for
libel: decision against Church of Scientology largest of its kind in