Barristers and Solicitors	German Spanish

   Torts — Trespass — Trespass to goods, conversion — Gold bar — Refining — Assault — Malicious prosecution.

   This was an action to recover the value of a gold bar delivered to the defendants who allegedly converted it to their own use.  The defendants counterclaimed for damages for malicious prosecution for theft.  One defendant counterclaimed for damages for assault.  The plaintiffs were jewellers.   Upon being approached by the plaintiffs, the defendants said that they would first assay the bar to test its content and inform the plaintiff whether they were satisfied and of the price. One defendant left the bar with his partner to be, refined notwithstanding that he was told that it was 3/9 pure and should have been assayed.  The plaintiff was informed that the content of the bar was not as pure as thought and he demanded the return of his bar.  Instead, he was given the option to accept money, gold or silver which he refused.  A scuffle ensued and one defendant put his hand on the plaintiff to push him out of the office.  The plaintiff pushed him back.   The bar had been refined and could not be returned.

   HELD:  The action was allowed and the counter-claim dismissed. The defendants were liable for the market value of the goods at the time of conversion.  The plaintiff did not use excessive force and had reasonable and probable cause to institute criminal proceedings.

STATUTES, REGULATIONS AND RULES CITED:
 

	Mining Act, R.S.O. 1980, c. 268, ss. 164, 165, 166, 166(1) (b), 169.
	F. De Santis, for the Plaintiffs.  J.G. Hodder, for the Defendants.

      MANDEL D.C.J.:— This is an action by the plaintiffs to recover from the defendants the sum of $8,945.46 being the value of a bar of gold which they allegedly delivered to the defendants and which they allege the defendants converted to their own use. The defendants James Paul Mironovich and Henryk Zacharewicz counter-claim for damages arising from the alleged malicious prosecution by the plaintiffs of the defendant James Paul Mironovich for theft. The defendant James Paul Mironovich further counter-claims against the plaintiff Keith William Siduak for damages arising out of his being assaulted by the plaintiff Siduak.

FACTS

      I find as follows. The plaintiffs carried on the business of jewellers in Burlington and Hamilton Ontario at all relevant times. They purchased old gold in the form of jewellery from the public. The Town of Burlington had enacted a by-law whereby it was incumbent for a purchaser of old gold to be licensed. At all relevant times the plaintiffs had such a licence in respect of their Burlington store. In Hamilton, the City did not enact a licensing by-law in respect of purchase of old gold until July 29, 1980 (see exhibits 33, 34 and 35). Prior thereto it was not necessary to have a licence. The plaintiffs did not have a licence in respect of their Hamilton operation until August 5, 1983 (see exhibit 34). The plaintiffs would amass the old jewellery so purchased from the public and when they had sufficient, they would refine it using a 2 stage process. At no time were the plaintiffs nor their operation licensed under Part X of The Mining Act R.S.O. 1980 Chapter 268 to refine gold from the old jewellery. The defendants James Paul Mironovich and Dobrila Mironovich are husband and wife and carry on business of purchasing and selling gems and precious metals under the name of Fashion Gem Imports. The defendants James Paul Mironovich and Henryk Zacharewicz are unrelated and carry on the business of refining precious metals under the firm name of F.G.I. Refining. In evidence, both Messrs. Mironovich and Zacharewicz described their partnership of F.G.I. Refining as being a division of the partnership Fashion Gem Imports and it is also so described in exhibit 3 being the receipt given by Mr. Mironovich to the plaintiffs for the bar left with him. Fashion Gem Imports was issued a refinery licence under Part X of The Mining Act. Mr. Zacharewicz was the person who actually did the refining. Mr. Mironovich met and dealt with the clients not only for Fashion Gem Imports but also F.G.I. Refining. The business of both partnerships were intertwined. In the summer of 1980, the plaintiffs attended upon Mr. Mironovich as a result of seeing an ad placed by the defendants to sell refining equipment. Such equipment was of no use to the plaintiffs. However Mr. Siduak did discuss with Mr. Mironovich, the sale of their gold. The plaintiffs up to then had refined their gold and sold it to other refiners. At this time the gold market was rising. The plaintiffs had been selling their gold to the Imperial Smelting & Refining Co. Limited (hereinafter called Imperial) at a rate of 5% of the amount purchased if the gold were 3/9 pure and 7% if less than 3/9 pure. The purchase price was the going market rate on the settlement date. Because the plaintiffs had informed Mr. Mironovich that they would deal with him in large quantities, Mr. Mironovich stated he would purchase such gold at a rate of 2% plus an assay charge of $35.00. The plaintiffs decided to give the defendants a trial. To such end, the plaintiffs had refined the old jewellery, they had on hand to 3/9 pure. The refined gold totalled some 26 odd ounces, and consisted of 3 bars. Two of such bars were delivered by the plaintiffs to Imperial on August 27, 1980. The third bar (which originally was part of the smaller of the two bars delivered to Imperial) was delivered to Mr. Mironovich also on August 27 1980. At the time of delivery Mr. Mironovich was specifically told that the bar was 3/9 pure. It is common ground between the parties and Mr. Mironovich specifically testified that in such circumstances regardless of the receipt which he gave to the plaintiffs for the bar, the defendants would first assay the bar i.e. drill holes in it and test to see if the bar's contents were 3/9 pure to satisfy themselves and would do so by a specific date. On such date the defendants would inform the plaintiff if they were satisfied and the price. If the defendants were not satisfied, or if the plaintiffs did not agree with the defendants in respect of their findings the bar would be returned. According to Mr. Mironovich, an assay as opposed to refining the bar, would be done whether the defendants received instructions in writing in the forms set out in exhibit 15 (being instructions of defendants to Johnson & Matthey Ltd., a refiner to whom they sold silver) or whether the defendants were orally informed that the bar was 3/9 pure. In refining the bar, the bar is destroyed and what is obtained and left is grains of gold. When he received the bar, Mr. Mironovich gave the plaintiffs a receipt signed by him in the following terms:
 

	"Received for refining net 369.8 grams, one bar of gold alloy
	Result by September 4th."

The receipt is on paper having the following letterhead

              "F.G.I. Refining Division of Fashion Gem Imports."

      Having regard to exhibit 3 and the evidence of both Mr. Mironovich and Mr. Zacharewicz, the plaintiffs dealt with all of the defendants. The contents of the receipt was of no concern to the plaintiffs for if the sale was ultimately consummated, the gold would be refined, but until consummated, the defendants had to satisfy themselves as to the purity and this would be done by assay. Furthermore, the plaintiffs understood that the defendants would not accept their word as to the purity and thus the words gold alloy did not disturb them, for it would be against the interest of the defendants who had not as yet satisfied themselves, to give a receipt for the bar, describing it as 3/9 gold and thus accept, without testing, the word of the plaintiffs. The word of a vendor is not accepted in the industry and this is shown by exhibit 1 which plaintiffs received from Imperial in respect of the 2 bars left with it on August 27, 1980. Such exhibit refers to "2 pcs. of gold lemel". The word lemel is a term used by Imperial to designate a mixture of materials and according to Mr. Vismantas of Imperial has the same meaning as alloy, and is used because refiners do not accept the word of persons who intend to sell gold to them. On August 28th 1980, the plaintiffs received the results from Imperial in respect of the 2 bars left with it. These 2 bars were 3/9 pure. The plaintiffs received payment for such bars from Imperial on August 29th 1980. The price was the second London fix times 95% of the amount of gold purchased. Meantime Mr. Mironovich gave the bar left with him to his partner Mr. Zacharewicz to be refined. This, notwithstanding that he was told that the bar was 3/9 pure and acknowledged during his testimony that in such circumstances the bar would not be refined but assayed notwithstanding what was written on the receipt. On September 4th 1980 Mr. Siduak telephoned Mr. Mironovich. Mr. Siduak was informed that the gold content of the bar was 324.73 grams which translated into .878 pure, which is considerably less than .999 or 3/9 pure that Imperial stated the 2 bars left with them were. Mr. Siduak immediately told Mr. Mironovich that this was not acceptable and demanded the return of his bar. Mr. Mironovich stated he could pick it up next day. On September 5th Mr. Siduak attended upon Mr. Mironovich at his offices in Toronto and was told by Mr. Mironovich that there was a "hold up in the factory" where the bar was and that Mr. Siduak could pick up the bar the following Monday, September 8th. During this time. Mr. Zacharewicz testified that he was having problems with equipment and as a result could not use the smelting furnace. On September 8th Mr. Piekarzczyk attended on Mr. Mironovich who told him that he did not have the bar but it would be available on the following Friday September 12th. He asked for a receipt and was given a receipt signed by Mr. Mironovich in the following form:
 

"Content of refined gold as per receipt No. 21073 of Aug. 29/80, will be returned by Friday." (See exhibit 6).

      This was not acceptable to the plaintiffs. However, it was the only document that Mr. Mironovich would give and Mr. Piekarzczyk took it and departed.

      On September 16th Mr. Siduak presented himself at the office of Mr. Mironovich. He asked for the bar and was given exhibit 7 which is headed credit note giving the plaintiffs the option of accepting $7,374.15 or 10.23 troy oz. fine gold and 0.41 troy oz. of fine silver. Mr. Mironovich also informed Mr. Siduak that he was to accept either option in full settlement. Mr. Siduak was not agreeable to this. The two shouted at each other. The one for the bar, the other that he did not have the bar and to take one of the 2 options. Mr. Mironovich, then told Mr. Siduak to get out and put his hands on Mr. Siduak to push him out of the office. Mr. Siduak pushed Mr. Mironovich back. Mr. Mironovich then called the police. The police came. A discussion took place and Mr. Siduak left. He subsequently contacted the police and on September 26th 1980 laid an information against Mr. Mironovich that he "unlawfully did steal one gold bar of a value exceeding $200.00." This trial was held in Provincial Court on January 9, 1981 and was dismissed. The bar left with the defendant Mr. Mironovich on August 27th 1980 was 3/9 pure and I specifically so find. As I have hereinbefore found, the defendant Mr. Mironovich was told by the plaintiffs it was 3/9 pure and notwithstanding that no instructions were given in writing and the receipt given by Mr. Mironovich states that the bar was received for refining, both parties understood that in such circumstances the bar was not to be refined but assayed so that if either party was not satisfied with the ultimate result, the bar would be returned to the plaintiffs. The defendants did not assay the bar but refined it thus destroying the bar.

      I do not accept the testimony of Mr. Mironovich and Mr. Zacharewicz insofar as their testimony is contrary to my findings as in these reasons set out. I do not accept such testimony for the following reasons. I found Mr. Mironovich less than forthcoming and instead of answering the questions asked equivocated and went into long dissertations that did not answer the questions. He was glib in his answers. He knew that the bar was refined into grains of gold and thus the bar could not be returned. Yet he told the plaintiffs that it would be returned. When asked why he said this he answered that although he was 90% sure that the bar did not exist, he told the plaintiff what he did, because he wanted to make sure it did not exist. Such an explanation is incredible. His testimony conflicted in material aspects with Mr. Zacharewicz as to his having told his partner what was transpiring with the plaintiffs and being told by Mr. Zacharewicz after informing him what transpired on September 8th to prepare exhibit 9. This was flatly denied by Mr. Zacharewicz. As well it conflicted with that of Mr. Vismantas, (whose evidence was straight-forward and credible) as to price. The evidence of Mr. Mironovich that the price paid for gold was secretive is incredible when compared to the evidence given by other refiners who stated that they obtained the price from Johnson & Matthey Ltd. on the phone. At one point Mr. Mironovich stated that if he was told the bar was 3/9 pure he would require that to be in writing and then obtain an assay. The same as Johnson & Matthey. He would have one believe that at all times there had to be a delivery note from the client for there to be an assay and gave as an example his dealings with Johnson & Matthey (see exhibits 15, 16, 17 and 18). Later he acknowledged that there did not have to be anything in writing and that if he was told the bar was 3/9 pure, that he would have assayed the bar notwithstanding his receipt stated it was received for refining. Again in examination-in-chief he stated that what is to be done with the material left with him is clearly set out in his receipt and only that is done i.e. refine and not assay. Subsequently he stated that notwithstanding what the receipt states, if he is told orally that the bar was 3/9 pure he would assay it. I did not find Mr. Mironovich to be credible.

      As for Mr. Zacharewicz, he acknowledged that his testimony was fully reconstructed. His testimony contradicted what he stated in his discovery held almost 3 years earlier as to his being told by Mr. Mironovich that the plaintiff wanted his bar back. On his discovery he stated that he did not recall his being so told until after the police were involved. He acknowledged that his memory is bad and he has no recollection and his testimony at trial was reconstructed. The reconstruction as to what Mr. Mironovich told him could only come from Mr. Mironovich after Mr. Zacharewicz's discovery. His answer as to why he reconstructed all of his testimony namely that the solicitor for plaintiffs asked him to obtain answers to certain undertakings from outside sources, is incredible, especially when he states that he thinks he passed on the change in the answers given on discovery which had nothing to do with the undertakings to his solicitor and it turns out from exhibit 31 that he did not and the question as to whether Mr. Mironovich told him that the plaintiffs wanted the bar back was not part of the undertakings. He was glib. His further explanation as to the answers given by him on discovery being at variance with those at trial was that the questions on discovery were unexpected does not inspire confidence in his testimony. Furthermore he testified that he is an expert refiner having refined precious metals for some 16 years, and that when he received the bar, he first did an acid test on it before he actually did the refining and found that there was high content of gold in the bar in the area of 22 carat or 90% or better gold content. Yet his results after refining is .878. I do not accept such result nor the testimony of Mr. Zacharewicz.

      After allowing the 2% commission and the $35.00 assay fee, I find that the value of the bar on September 4th 1980 the date that both parties agree was the settlement date was the sum of $8933.80. The difference between such amount and the amount claimed by the plaintiffs, is the sum of $11.66 or $1.00 an ounce i.e. the difference in the value of 3/9 pure (which I have found the bar to be) and 4/9 pure according to Mr. Murton. The defendants are liable for the market value of the goods at the time of conversion in a subsequent falling market, as here. (McGregor on Damages 13th Ed. para 991).

THE DEFENCES

      The issues, except for the matters hereinafter set forth, are matters of credibility and have been resolved by my findings as hereinbefore set forth. During submissions the following were put forward.

MITIGATION

      The defendant relying on Payzu Ltd. v. Saunders (1919) 2 K.B. 581 submitted that the plaintiffs should have accepted one of the options given by the defendant (exhibit 7) on September 16th 1980 and not having done so, did not mitigate their damages. In that regard the defendants offered same in full and complete settlement. The answer to such a submission is set forth at paragraph 1208 et sequ in Waddams, The Law of Damages viz. the plaintiff is not bound to accept an offer from the defaulting party if acceptance involves abandoning rights against the defendants. Aliter if the defendants offer is without prejudice to the rights of the plaintiff to claim for any damages above such offer. At no time was the latter type of offer made to the plaintiffs. The offers were in full and complete settlement. The defendants then state that they tendered 10.23 troy ounces of gold. However such tender was defective in that they tendered less than was found to be due to the plaintiffs and further such tender was made during a time when the gold market was falling so that the value thereof was less than the amount found to be the value of the gold as hereinbefore set forth. In addition the defendants obtained an order of Judge Scime on June 16th 1982 to pay the value into Court and did not do so. In my view the submission of the defendants is without merit. (In that regard see McGregor supra para 1030).

PAROLE EVIDENCE RULE

      The defendants submit that the receipt (exhibit 3) is not ambiguous and that no extrinsic evidence is available to vary such document i.e. the bar was to be refined and not assayed. The defendants rely on Transcanada Pipelines v. Northern and Central Gas 41 O.R. 447. That case is clearly distinguishable, for there what was in question was clearly the written contract between the parties. Here what is written is not the contract between the parties. Both parties agree that if the plaintiff had informed the defendants that the bar was 3/9 pure, that there were several steps to be taken before there was a contract between the parties notwithstanding what the receipt stated. I have found that the defendants were so informed. The extrinsic evidence is admissible on 2 grounds. First as is stated in Halsbury Laws of England 4th Ed. Volume 12, Deeds at p. 1483.
 

It is in all cases a question of fact whether a particular document was intended to express the whole of the terms of the contract between the parties and with what intention it was signed by one or other of the parties and on those points extrinsic evidence is admissible."

      There is cited as an authority for the above amongst other cases the case of Allen v. Pink 150 E.R. 1376. In that case Pink signed a receipt in the following words:
 

"Bought of G. Pink, a horse for the sum of 7 pounds [Sterling] 2s 6d."

The Court of Appeal held that the writing was "meant merely as a memorandum of transaction or an informal receipt for the money not as containing the terms of the contract itself" and allowed extrinsic evidence to show the terms of the contract.

      Secondly extrinsic evidence is allowed to show that a prior condition has not been fulfilled (see Long v. Smith (1911) 23 O.L.R. 121; Standard Bank v. Wettlaufer 33 O.L.R. 441 and unreported Supreme Court of Canada case of Williams & Glyns Bank Ltd. v. Belkin Packaging).

      In the case at bar before refining could take place, the defendants were to assay the bar and report back to the plaintiffs whether they were satisfied that the bar was 3/9 pure and if the bar was in the defendants view not 3/9 pure but something less the plaintiff had the option to have its bar returned. Clearly such act was a condition precedent to the bar being refined.

      In my view the submission of the defendants is not tenable.

ILLEGALITY OF THE TRANSACTION

      The defendants submitted that the transaction between the parties was illegal in that
 

(a)		The plaintiffs did not have a licence from the City of Hamilton to buy gold and
(b)		The plaintiffs did not have a refining licence.

(a)  City of Hamilton Licence.

      The City of Hamilton By-law was enacted on July 29 1980. The gold bar which was refined from old jewellery purchased by the plaintiffs was delivered to the defendants on August 27, 1980. During submissions it was pointed out to counsel for the defendants that there was no evidence before me as to when the old gold was purchased i.e. prior to July 29, 1980 when no licence in Hamilton was required or post July 29, 1980 or whether some was prior and some post and the extent of such purchases. Furthermore there was no evidence as to where such old gold was purchased i.e. in Burlington where the plaintiffs had a licence or in Hamilton where a licence was required only after July 29, 1980 and again if some was purchased in both areas the extent thereof. Faced with foregoing the defendants withdrew their submissions as to illegality based on the plaintiffs not being licenced by the City of Hamilton to purchase old gold after July 29, 1980.

(b)  The Refining Licence

      It is clear from Menard v. Generoux (1982), 39 O.R. (2d) 55 and Berne Development Ltd. v. Havilland 40 O.R. (2d) 238 that a court is bound to act proprio motu when the facts disclosed illegality, even though the matter had not been pleaded.

      As I have found the plaintiffs refined the old gold and gave the bar to the defendants to satisfy themselves that the bar was 3/9 pure. It is only after they satisfied themselves that a contract for the bar would come into being for if the defendants were not satisfied, the plaintiff upon being notified of the result had the option of taking back the bar or agreeing with the results of the defendants. Put another way it was a condition precedent to the formation of the contract. There is no contract between the parties (see Trans Trust v. Danubian Trading (1952) 2 Q.B. 297 at 304. The condition was not met. The plaintiffs seek the return of their bar (which could not be returned for it was destroyed) or its value on September 4th 1980 (in that regard see McGregor on Damages supra para 1030). Can the defendants resist on the basis of illegality of a contract that is non-existent? To ask the question is to answer it.

      The defendants rely on section 165 of The Mining Act. Such section reads in part "no person shall, own, operate, use or have a refinery.....unless a refinery licence has been granted in respect of such refinery...." A refinery is by Section 164 defined as apparatus or equipment that may be used for the refining of among other metals, gold. It is to be noted that according to such section there is no prohibition against selling gold refined by an unlicensed refinery. Ms Gartley of the Ministry of Northern Development and Mines made it quite clear that it is the apparatus and equipment that is licensed and not the person and the Ministry does so license in the public interest (see Section 166(1)(b).) There is a penalty for using such unlicensed refinery (S. 169).

      Assuming that there is a contract (and in my view there is not), the modern judicial view to illegality and what is to be taken into consideration are set out in the cases of Royal Bank of Canada v. Grobman (1977) 83 D.L.R. (3d) 415; Re Lambton Farmers Ltd. (1978) 91 D.L.R. (3d) 290; Archbold (Freightage) Ltd. v. Spanglett Ltd. (1961) 1 Q.B. 374. Assuming that the prohibition by inference includes the sale of gold refined by an unlicensed refinery (and such assumption entails a quantum leap) in my view such a sale to a licensed refinery which does not rely on what is stated by the vendor but will carry out its own processes, is a transaction which does not fall within the purview of the Act and the licensed refinery is not an entity for whose protection the section in question was enacted. I am further of the view that the section does not apply to the sale of gold refined at an unlicensed refinery and in that respect my view is reinforced by St. John Shipping v. Joseph Rank Ltd. (1957) 1 Q.B. 267 where a carrier was permitted to recover freight even though it had deliberately overloaded its ship; the statute being held to ban overloading ships not agreements to carry freight. Again in my view the purpose of the statute is sufficiently served by the penalties proscribed for the offender rather than avoiding the contract, assuming there was one (see Archbold (Freightage) Ltd. v. Spanglett supra, per Devlin L.J. at p. 390). Moreover such an illegal contract does not prevent the owner of the goods transferred from recovering them relying on his right of ownership independent of the illegal transaction (Bowmakers v. Barnet Instruments (1945) K.B. 65; Belvoir Finance v. Stapleton (1971) 1 Q.B. 210; Singh v. Ali (1960) A.C. 167). Finally on the assumption that the contract is illegal, to allow the defendants to retain the gold or anything than its value as of September 4th 1980 would result in the unjust enrichment of the defendants (Berne Development Ltd. v. Havilland, supra).

      For all of the above reasons in my view this submission of the defendants is also untenable.

      Accordingly the plaintiffs are entitled to judgment against the defendants in the sum of $8,933.80.

THE COUNTER-CLAIM

      Battery

      As I have found the defendant Mironovich after the shouting match, demanded that the plaintiff Siduak leave and laid hands on the plaintiff pushing him to the door. The plaintiff pushed back and I find that in so doing the plaintiff did not use excessive force. I further find that the defendant was neither injured nor harmed by such push. Accordingly the counter-claim of the defendant Mironovich for damages for the alleged battery is dismissed (see Fleming The Law of Torts Sixth Edition p. 77 et sequ.; Hinton v. Heather 14 M & W 131).

      Malicious Prosecution

      The onus is upon the Messrs. Mironovich and Zacharewicz not only to prove that the plaintiffs instituted the criminal proceedings without reasonable and probable cause but also for an improper purpose ((Abrath v. N.E. Ry (1883) 11 Q.B.D. 440; Cox v. English, Scottish & Australian Bank 1905 A.C. 168).

      Not only must the prosecutor's subjective belief in the guilt of the accused be honest but it must be based on evidence that persons of reasonably sound judgment would regard as sufficient for launching a prosecution. (See Fleming supra at 582-583). Even if malice exists, if the prosecutor had reasonable and probable cause, the action is dismissed (See Herniman v. Smith (1938) 1 All E.R. 1). For as is stated in Glinski v. McIver (1962) 1 All E.R. 696 (House of Lords), though malice in a proper case may be inferred from want of reasonable cause, such cause or lack of belief in the prosecutor's case is not to be inferred from the existence of malice. (See also Turner v. Ambler (1847) 10 Q.B. 252 at 261).

      Here the prosecutor was so involved that the very basis of the case for the prosecution was his testimony. In fact the only person who testified for the crown at the Provincial Court was Mr. Siduak. At the end of his testimony, counsel for Mr. Mironovich moved that the case be dismissed in that there was "no prima facie case". Such motion was dismissed and both Messrs. Mironovich and Zacharewicz testified. The charge was dismissed the Court stating inter alia that "although as I ruled on the motion there's a prima facie case, it certainly is not proven beyond a reasonable doubt". The Court further felt that persons carrying on business for as long as the accused did would not run a scheme to filch gold by this method and that it is a civil matter. Thus the prosecution boiled down to the testimony of Mr. Siduak against that of Mr. Mironovich who dealt with him and Mr. Zacharewicz who did not deal with Mr. Siduak but who refined the bar. There were no independent third parties. In such circumstances the words of Lord Denning in Glinski v. McIver supra at p. 711 are apposite.
 

"Second, there are some cases where the prosecutor is personally involved, so much so that his own evidence is the very basis of the case for the prosecution:  and it is flatly contradicted by the evidence of the accused. The issue then appears simple. If he was speaking the truth, there was good cause for the prosecution. If he was lying, there was no cause for it. In those cases he has to face the fact that his evidence has not been accepted at the criminal trial for the accused man has been acquitted. But this does not mean that there was no reasonable or probable cause for prosecution. It depends on his state of mind when he launched the charge. If he honestly believed that the facts were as he stated, then, even though it turned out to be a mistaken belief, he would have reasonable and probable cause to prosecute: but if he had no such honest belief and was consciously putting forward a false case he would have no cause to prosecute."

      I find that Mr. Siduak had an honest belief in the case that he put forward. Furthermore his testimony was in the opinion of the Provincial Court Judge a prima facie case. As was stated in German v. Major 20 D.L.R. (4th) 703 (Alberta Court of Appeal) at p. 711 "what better test than to observe .... that a presumptively reasonable person (the trier of fact in the criminal case) saw a prima facie case?"

      As Fleming states at p. 583 "In any event, unshakable certainty in the guilt of the accused is not demanded, since a fair minded man may well feel justified in bringing a suspect to justice without, in his own mind, prejudging the issue. It is sufficient, if he believes that the probability of guilt is such that upon general grounds of justice a charge is warranted. In other words, he may have a probable cause for initiating a prosecution, although lacking a conviction of guilt beyond reasonable doubt such as a jury must entertain to justify a verdict of guilty."

      I find that Mr. Siduak had reasonable and probable cause to institute the criminal proceedings. Accordingly the counter-claim is dismissed.

      In accordance with the wishes of counsel I may be spoken to as to prejudgment interest and costs.

MANDEL D.C.J.