Executive Summary: Key Legal and Evidentiary Issues

• Limitation periods under The Municipalities Act were decisive, with both the defamation and refund claims against the Village and its first responder held to be statute-barred.
• Precision in defamation pleadings was central, as the plaintiff failed to particularize the exact defamatory words, time, place, and recipients sufficiently to disclose a reasonable cause of action.
• The attempted fresh evidence (response to request for particulars) was rejected on appeal because it did not satisfy the due diligence requirement under the Palmer test and would effectively give the plaintiff a “second kick at the can.”
• Scope of municipal powers and procedures was contested, but the Court affirmed that bylaws authorizing fire-service fees and adding unpaid fees to the tax roll fall within the broad, purposive grant of authority in The Municipalities Act.
• Allegations of bad faith and improper motive by municipal actors failed for want of admissible evidence, with the Court refusing to rely on unproven narratives from other disputes.
• Corporate ownership of the taxed land (via 6517633 Canada Ltd.) did not assist the plaintiff, as the invoices were properly issued and the payment voluntarily made, triggering the strict six-month refund limitation period.

Background and parties

The litigation arose from a farm accident and medical emergency involving Stan Sheppard on September 10, 2021, on land in the Rural Municipality of Norton No. 69 in Saskatchewan. After he was trapped under farm equipment, the RCMP and volunteer first responders from the Village of Pangman were dispatched to locate and extract him. Among the responders was Keith Howse, who served both as a volunteer first responder for the Village and as an employee of Sun Country Health Authority. Once Mr. Sheppard was found and freed, Howse transported him by ambulance to a Regina hospital for treatment.

The parties ultimately involved were: Mr. Sheppard as plaintiff/appellant; Sun Country Health Authority; Mr. Howse in his dual capacities; and the Village of Pangman, later with allegations also directed at the Village and RM administrator, Patti Gurskey, and by implication the RM. The central defendants on appeal were the Village and Mr. Howse in his role as a Village first responder, along with the residual position of Sun Country, which did not actively oppose the appeal.

Facts leading to the lawsuit

While at the Regina hospital, Mr. Sheppard alleged that Howse made defamatory statements about him in the presence of medical personnel, including a doctor or nurse said to be an acquaintance of one or the other. He claimed that these statements caused irreversible harm to his reputation and his ability to conduct business, and further asserted that Howse distracted medical staff at a critical moment, compromising his care.

Separate from the alleged defamation, the Village issued an invoice dated September 10, 2021, for $2,400, described as two hours of “Rescue Call Extrication / Entrapment Call.” When the invoice went unpaid, the Village applied a late-payment penalty of $288. The outstanding total of $2,688 was then added to the tax roll in the RM as an assessment on property owned by 6517633 Canada Ltd., a numbered company connected to Mr. Sheppard. On August 31, 2022, he paid the 2022 municipal taxes, including this charge, asserting that he did so under protest. The tax receipt reflected that the payment was made by 6517633 Canada Ltd.

On September 8, 2023, almost two years after the emergency incident, Mr. Sheppard issued a statement of claim in the Court of King’s Bench. He pleaded defamation against Sun Country, the Village, and Howse, seeking $1,000,000 in punitive damages and $500,000 in aggravated damages, alleging that the defendants were jointly and severally liable. He also sought refund of the $2,688 in fees and penalties charged and collected via the tax roll, claiming that the Village had no lawful authority to impose and collect the sums as it had done.

Procedural history in the Court of King’s Bench

The Village promptly responded by serving a request for particulars of the defamation claim in September 2023, seeking a more precise description of the alleged defamatory words, their context, and their recipients. Shortly afterward, it brought a motion under Rule 7-9(2) of The King’s Bench Rules to strike the action on three grounds: failure to disclose a reasonable cause of action, frivolous and vexatious proceedings, and expiry of the relevant limitation periods under The Municipalities Act.

Before that strike application was heard, Mr. Sheppard sought to amend his claim to add a new defamation allegation against administrator Patti Gurskey, said to have occurred on September 12, 2023, and to extend those allegations, by employment, to both the Village and the RM. He did not, however, add the RM itself as a named party. The King’s Bench judge agreed to consider the late amendment motion alongside the Village’s strike application.

In January 2024, the King’s Bench released its decision striking key portions of the claim. The judge concluded that any action against the Village and against Howse as a Village volunteer first responder in relation to the 2021 incident was statute-barred under The Municipalities Act, and that the defamation pleadings, even as amended, failed to disclose a reasonable cause of action. The judge emphasized that the statement of claim did not set out the precise words alleged to be defamatory or sufficient particulars of publication, and that Mr. Sheppard had not responded to the Village’s demand for particulars in a way that appeared on the court file.

With respect to the late-added claim that Gurskey had raised her voice and used foul language, the judge held that, while rude and unprofessional, such conduct was not defamatory at law and could not sustain a defamation action. Those allegations were also struck, effectively disposing of the claims tied to the RM and its administrator. The judge further held that the claim for a refund of the $2,688 was barred by the six-month limitation period for actions seeking return of money paid as taxes to a municipality.

Importantly, the judge did not strike the defamation claim as it related to Sun Country and Howse in his capacity as a Sun Country employee. That portion remained extant, because the King’s Bench application was confined to the Village’s position and Howse’s role as a Village first responder.

A formal order issued on February 7, 2024, recording that the claims against the Village and against Howse in his Village first responder capacity were struck, and that corresponding portions of the statement of claim were removed, consistent with a draft amended pleading filed by Sun Country.

The appeal and the fresh evidence application

Mr. Sheppard appealed to the Saskatchewan Court of Appeal. His notice of appeal advanced two main themes but the Court reframed them as two questions: whether the judge erred in striking the defamation claims against the Village, Howse in his Village capacity, the RM, and Gurskey; and whether the judge erred in holding that the refund claim was barred by section 278 of The Municipalities Act.

Alongside the appeal, Mr. Sheppard brought an application to adduce fresh evidence: specifically, his response to the Village’s request for particulars. He asserted that he had prepared and served this response on November 3, 2023, on counsel for Sun Country and thought he had filed it with the local registrar on November 6, 2023, but that it had been misfiled or lost by the court office. He argued that the King’s Bench judge should not have penalized him for an administrative mishap beyond his control.

The Court of Appeal applied the well-known Palmer test governing fresh evidence on appeal. The test has four components: due diligence; relevance; credibility; and the potential to affect the result. The Court emphasized, consistent with recent Supreme Court of Canada authority in Barendregt v Grebliunas, that the due diligence requirement is driven by the principle that litigants must put their best case forward at first instance, and that appellate courts should generally not permit a party to cure evidentiary or pleading omissions after the fact.

Reviewing the trial court record, the Court of Appeal found no indication that Mr. Sheppard’s response to the request for particulars had been filed prior to judgment, or even shortly thereafter. The only version of the response on the record bore a registry stamp of February 12, 2024, weeks after the King’s Bench decision. There was also no proof of service of this response on the Village or its counsel before the strike application was argued, only on Sun Country’s counsel. On those facts, the Court held that the due diligence branch of the Palmer test was not satisfied. The proposed fresh evidence thus failed at the threshold and could not be admitted.

The Court further observed that acceding to Mr. Sheppard’s request would conflict with the finality and fairness concerns articulated in Barendregt, as it would permit a litigant to fill gaps in his case only after losing, amounting to a “second kick at the can.” For that reason, it declined to conduct a full Palmer analysis of the remaining criteria and dismissed the fresh evidence application.

Defamation pleadings and limitation issues

Turning to the merits of the appeal, the Court of Appeal first examined the striking of the defamation claims. It clarified that the appellate court could only assess the record that was before the King’s Bench judge, which did not include any timely-filed, effective response to the request for particulars. Given that, the judge could not be faulted for striking a defamation pleading that lacked the particularity demanded in this area of law.

The Court reaffirmed Saskatchewan authority that, although courts have relaxed the strict historical requirement to plead the exact words of the alleged defamation in every case, defamation pleadings still require enough detail that the defendant knows the case to meet and can prepare a defence. At a minimum, a plaintiff must clearly identify the defamatory communication and the circumstances of publication. Here, the pleadings were too vague and generalized, and the absence of a properly filed and served response to particulars meant the deficiency remained when the strike application was heard.

The appellate court also addressed the limitation analysis. The King’s Bench judge had applied section 344(1) of The Municipalities Act, which provides that an action for damages against a municipality must be both commenced and served within one year of when the damage was sustained. Since the alleged wrongs occurred in September 2021, and the statement of claim was not filed or served until September 2023, the claims against the Village were plainly out of time. The judge had also treated the claim against Howse, in his capacity as a Village volunteer first responder, as subject to the same municipal limitation regime.

The Court of Appeal cautioned that municipal limitation periods cannot automatically be extended to every claim against municipal employees, servants, or agents; rather, it is necessary to consider, in line with prior appellate decisions, whether it is truly plain and obvious that a municipal limitation applies to a given non-municipal defendant. Nevertheless, the Court saw no live appeal of the finding that the defamation claim against Howse as a Village responder was statute-barred, and the limitations ruling as to the Village itself was clearly correct.

Municipal powers, tax collection and refund limitation

On the refund claim, Mr. Sheppard argued that municipalities should be held to a higher standard than private actors, that the Village and RM exceeded their jurisdiction by using the tax roll to collect rescue-service fees, and that their actions were tainted by bad faith and personal animus, particularly through the involvement of an RM councillor with whom he had prior disagreements. He also contended that the RM’s statutory role was confined to road maintenance and other narrow infrastructure functions and that any attempt to recover money from him should have proceeded only by way of a conventional civil claim and not by the municipal taxation mechanism.

The Court of Appeal rejected these submissions. It started from the orthodox position that municipalities are statutory corporations, “creatures of the Legislature,” whose powers derive from and are bounded by provincial legislation. Under The Municipalities Act, councils are expressly empowered to provide services they consider necessary or desirable, including fire and emergency response services, and to pass bylaws setting fees for these services. The Village had such bylaws in place governing fire services, and the record supported that the invoice issued to Mr. Sheppard reflected the deployment of the volunteer fire department to his property.

Furthermore, section 369 of The Municipalities Act authorizes municipalities to add certain unpaid fees to the tax roll for a property, deeming those amounts to be taxes from the date they are added. Among the recoverable charges are unpaid fees for services such as fire-related responses. On that statutory footing, the Court held that the Village’s use of the tax roll to collect unpaid rescue fees was a policy choice clearly contemplated by provincial legislation; disagreement with the wisdom of that policy could not render the Act invalid or the Village’s conduct ultra vires in the absence of any constitutional challenge.

The Court also dismissed the allegation of bad faith. There was no admissible evidence demonstrating that the Village or RM were pursuing any improper motive, or that the involvement of the councillor converted a lawful statutory mechanism into an abuse of power. Oral references to unrelated disputes and other proceedings were not a proper evidentiary basis in this appeal.

As to the corporate ownership point, the Court noted that the invoices were addressed to Mr. Sheppard “care of” 6517633 Canada Ltd., and that the tax roll assessment was placed on property owned by that company. Nonetheless, the record showed that an invoice was sent, the charge was added to the tax roll under the statutory scheme, and the outstanding sum was paid in due course with the annual property taxes. Mr. Sheppard did not deny receiving the invoices or making the tax payment, only asserting that it was done under protest.

The key legal obstacle, however, was section 278 of The Municipalities Act. That provision imposes a strict six-month limitation period for any action seeking the return of money paid to a municipality as taxes or tax arrears, whether paid under protest or otherwise. If no such proceeding is commenced within six months of payment, the statute deems the payment voluntary and bars recovery. Because Mr. Sheppard paid the $2,688 on August 31, 2022, but did not commence his proceeding until September 8, 2023, his refund claim was clearly out of time. The Court of Appeal agreed with the King’s Bench judge that section 278 applied and that the claim for repayment of the rescue fees and penalty was therefore statute-barred.

Final disposition and result

In the end, the Saskatchewan Court of Appeal upheld the King’s Bench decision in all material respects. It refused to admit Mr. Sheppard’s proposed fresh evidence, confirmed that his defamation pleadings against the Village, the RM administrator, and Howse in his Village capacity were properly struck for want of particularity and because of expired limitation periods, and agreed that the statutory six-month limitation for refund of money paid to a municipality as taxes precluded any recovery of the $2,688 collected via the tax roll. The Court also reiterated that the underlying defamation claim against Sun Country Health Authority and against Howse as its employee remained alive in the Court of King’s Bench, as it had never been the subject of the Village’s strike application or the King’s Bench order.

Accordingly, the appeal was dismissed. The successful party on appeal was the Village of Pangman, which was awarded a fixed sum in costs for both the appeal and the fresh evidence application. The Court ordered costs to the Village in the amount of $1,000 inclusive, made no order for costs in favour of Sun Country, and granted no damages or other monetary relief.