Multi-million dollar defamation lawsuit against N.W.T. town and officials dismissed

·3 min read
The former SAO of the Town of Norman Wells has been unsuccessful in a multi-million dollar defamation lawsuit against the town, its mayor, its former and current senior administrative officers. (Katie Toth/CBC - image credit)
The former SAO of the Town of Norman Wells has been unsuccessful in a multi-million dollar defamation lawsuit against the town, its mayor, its former and current senior administrative officers. (Katie Toth/CBC - image credit)

A former senior administrative officer (SAO) in Norman Wells has been unsuccessful in a multi-million dollar defamation lawsuit against the town, its mayor and its former and current senior administrative officers.

Catherine Mallon worked as the town's SAO for about three years until the fall of 2018. Following her employment, a new mayor and council filed a lawsuit against her and the town's former mayor Nathan Watson, alleging they conspired to defraud the town of $1.26 million, citing significant irregularities in her pay and credit card use among other matters.

The accusations have not been tested in court.

Mallon's lawyer, Matthew Woodley, told CBC News his client "continues to defend herself against the town's allegations. She looks forward to the opportunity to provide her side of the story."

The fraud lawsuit has been wrought with issues. N.W.T. Supreme Court Justice Karan Shaner said the town was guilty of "an egregious miscarriage of justice" in December 2019. Shaner said the town used inappropriate tactics to convince a judge to put a freeze on the assets of former mayor Nathan Watson and former senior administrative officer Catherine Mallon, when it tried to make it sound like Mallon was planning to leave the country.

In the spring of 2020, Mallon filed a lawsuit in response to the way allegations against her were being communicated.

She sought $2.57 million for harm to her reputation that she says has left her unemployable. Her suit names the town, Mayor Frank Pope, its current SAO Cathy Clarke and former interim SAO Darren Flynn.

Richard Gleeson/CBC
Richard Gleeson/CBC

The case was in court on March 29 and 30 this year, and Shaner filed the reasons for her decision on Nov. 22.

In her statement of claim, Mallon alleged the relationship among town councillors and between herself and some councillors was fraught with antagonism and dysfunction.

Mallon alleged a public meeting to inform residents about the fraud action and making related documents available amounted to defamation. She said it was also defamatory when people named in the suits made comments about her to potential employers, media and others — including Pope's comments that Mallon was improperly paid overtime, had used the town's corporate credit card to make purchases outside the country, and was paid for vacation leave she had already taken, among other things.

The judge dismissed the defamation claims on the basis that the statements were made by officials who had absolute or qualified privilege, which meant the officials made the comments over the course of their work and had a legal, moral or social duty to have made them. The various forms of disclosures to residents and other parties, such as the public meeting, were reasonable and without the dominant objective of harming Mallon, the judge said.

Katie Toth/CBC
Katie Toth/CBC

Woodley called the court's decision "unfortunate" and pointed out it doesn't make any findings about whether Mallon did anything wrong.

He said Mallon would continue with other aspects of the claim against the town, but did not provide further detail to CBC News about what parts of the claim she would be pursuing.

The town's current SAO, Cathy Clarke, told CBC News that "as far as the defamation suit is concerned this is it ... all that has been presented in the court to date is done."

Current Mayor Frank Pope said he saw no reason they could lose the case, and believes residents are "elated" at the results. The town is hoping to hear an updated schedule in regards to the fraud case soon, he said.

The town's former mayor, Nathan Watson, filed a defamation lawsuit similar to Mallon's against the town and some of its officials, claiming more than $1.5 million in damages.

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