Today’s decision of the Court of Appeal for Ontario in Bedessee Imports Ltd. v. Guyana Sugar Corporation, Inc., 2010 ONCA 719 ["Bedesseee"] is the first to apply the Supreme Court of Canada’s recent decision in Kuwait Airways Corp. v. Iraq, 2010 SCC 40, which I discussed in my recent post: Rough Landing: Supreme Court of Canada ejects Iraq’s State Immunity Defence: Kuwait Airways Corp v. Iraq. It also confirms that using a government official as a spokesman for a government-owned brand is a bad idea.
In Bedessee, the appeal arose from a motion to dismiss a defamation claim made against the Minister of Agriculture of the Government of Guyana and a state-owned company on grounds of state immunity .The motion judge had dismissed that motion and held that the Minister’s statements fell within the commercial activity exception to state immunity provided for in s. 5 of the State Immunity Act, R.S.C. 1985, c. S-18.
The appellants’ primary argument was that the motion judge erred in unduly emphasizing the purpose of the Minister’s statements, rather than focusing on the nature of those statements, namely, statements made in the public interest and with a constitutional dimension, which were made by a minister speaking on behalf of the Government of Guyana.
In rejecting those submissions, the Court of Appeal for Ontario concludes:
 In our view, the reasons of the motion judge are entirely consistent with [the contextual approach directed by the] Supreme Court of Canada. The motion judge considered the statements of the Minister in the context of the ongoing trademark dispute between the state-owned Guyana Sugar Corporation and the respondent and concluded at para. 59:The statements promoted Guyana’s “brand” and disparaged the brand of a competitor. To permit a lawsuit by Bedessee in relation to such activity is neither an affront to the dignity of the Guyanese state nor an interference with its sovereign functions. This conclusion was supported by the motion judge’s factual findings which, in turn, were well supported by the evidence. We agree with his careful reasons and we see no basis to interfere. We do note that in Kuwait Airlines at para. 22, the Supreme Court of Canada held that it is up to the party opposing the state asserting its immunity to establish that it may rely on an exception to this immunity. In his reasons, the motion judge applied the law as it stood when he decided the case and placed the onus on the appellant to make out the immunity. However, it is apparent to us from his reasons that the placement of the onus played no role in the motion judge’s decision.”