Date: 20000328
Docket: T-1473-91
BETWEEN:
REMO IMPORTS LTD.
Plaintiff
- and -
JAGUAR CANADA INC. and
JAGUAR CARS LIMITED
Defendants
REASONS FOR ORDER AND ORDER
O"KEEFE J.
[1]This is an appeal by Jaguar Canada Inc. and Jaguar Cars Limited from certain
parts of an Order of Prothonotary Richard Morneau dated May 29, 1999. The Prothonotary had before him two motions, one brought by each party, which dealt with outstanding questions from the examinations of discovery of the representatives of the plaintiff and the defendants.
[2]The Prothonotary summarized the background of the file as follows:
[3] Remo Imports Ltd. (Remo) instituted proceedings against Jaguar Canada Inc. (Jaguar Canada) and Jaguar Cars Limited (Jaguar U.K.) for trade mark infringement, passing off as well as for the expungement of the following wares covered by Jaguar U.K."s Canadian registration Nos. 378,644 and 378,643 for the trade marks "JAGUAR" and "JAGUAR" & design, namely driving license cases, wallet cases, business card holders, credit card holders, key cases, address books, notebooks, passport holders, beauty cases, document cases and pocket wallets (the offending wares).
[4] Remo"s action is based on the alleged unlawful use in Canada of the trade mark "JAGUAR" by Jaguar U.K. and Jaguar Canada in respect of non-automobile wares, including attaché cases, sport bags and belts, in infringement of Remo"s registration No. 263,924 for the trade mark "JAGUAR" covering tote bags and baggage, as well as handbags and school bags.
[5] Remo additionally seeks that the offending wares be deleted from Jaguar U.K."s registration Nos. 378,643 and 378,644 for the trade marks "JAGUAR" & design and "JAGUAR" on the basis that, inter alia , Jaguar U.K. was not entitled to the registration of such trade marks in respect of the offending wares, given the existence of Remo"s prior registration No. 263,924 for the trade mark "JAGUAR" for similar wares.
[6] As appears from the Statement of Claim, Remo alleges that Jaguar U.K. was not the person entitled to obtain registration Nos. 378,643 and 378,644 for the trade marks "JAGUAR" & design and "JAGUAR" for the offending wares because such marks were confusing with Remo"s trade mark "JAGUAR" previously used in Canada by Remo since at least 1981 in association with maroquinerie.
[7] In their Statement of Defence and Counterclaim, Jaguar Canada and Jaguar U.K. seek the expungement of Remo"s registration No. 263,924 for the trade mark "JAGUAR" as well as the issuance of a permanent injunction restraining Remo from selling, advertising or otherwise using in Canada in association with consumer products its trade marks "JAGUAR", "JAGUAR SPORT" or any trade mark confusingly similar to the "JAGUAR" family of trade marks owned by Jaguar U.K.
[8] As appears from the Statement of Defence, it has been alleged that:
(a) There has been extensive use of the trade mark "JAGUAR" in Canada in respect of automobiles and consumer products.
(b) There has been widespread promotion and advertisement by Jaguar U.K. of its "JAGUAR" family of trade marks and products in Canada.
(c) The "JAGUAR" family of trade marks have long been considered famous trade marks in Canada.
(d) Since 1981 and on a continually expanding basis thereafter, Jaguar U.K. has sold in Canada in association with one or more of the "JAGUAR" family of trade marks a full range of consumer products, including the leather products set out in Schedule C of the Statement of Defence, namely, attaché cases, briefcases, handbags, license cases, wallets, card holders, key rings, key cases, garment bags, suitcases, flight bags and other luggage.
(e) Remo adopted its trade mark "JAGUAR" with full knowledge of the famous "JAGUAR" family of trade marks so as to trade on the reputation of such marks.
(f) Remo was not the person entitled to secure registration of its trade mark "JAGUAR" because as of the date of first use, it was confusing with the "JAGUAR" family of trade marks previously used and made known in Canada by Jaguar U.K. and that Remo adopted its trade mark with knowledge of that previous use and making known.
[3] The defendants have appealed the decision made by the Prothonotary in
paragraphs 18, 20, 22, 23, 29, 30, 31, 36, 39, 40, 47 and 48 of the Reasons for Order and Order dated May 25, 1999. The plaintiff also asked for an order extending the time for providing written answers until 90 days after the order on this appeal and the plaintiff asked for its costs of this motion.
[4] Section 240 of the Federal Court Rules, 1998 states:
| Scope of examination 240. A person being examined for discovery shall answer, to the best of the person"s knowledge, information and belief, any question that (a) is relevant to any unadmitted allegation of fact in a pleading filed by the party being examined or by the examining party; or (b) concerns the name or address of any person, other than an expert witness, who might reasonably be expected to have knowledge relating to a matter in question in the action. |
Étendue de l"interrogatoire 240. La personne soumise à un interrogatoire préalable répond, au mieux de sa connaissance et de sa croyance, à toute question qui: a) soit se rapporte à un fait allégué et non admis dans un acte de procédure déposé par la partie soumise à l"interrogatoire préalable ou par la partie qui interroge; b) soit concerne le nom ou l"adresse d"une personne, autre qu"un témoin expert, don"t il est raisonnable de croire qu"elle a une connaissance d"une question en litige dans l"action. |
| [5] MacKay J. stated in Sydney Stell Corp. v. Omisalj (The), [1992] 2 F.C. at page 197: |
Counsel for the parties are essentially agreed that the standard for propriety of a question asked in discovery is less strict than the test for admissibility of evidence at trial and the appropriate standard is whether the information solicited by a question may be relevant to the matters which at the discovery stage are in issue on the basis of pleadings filed by the parties. As noted by the defendants the test is as set out by Norris D.J.A. in McKeen and Wilson Ltd. v. Gulf of Georgia Towing Co. Ltd. et al., [1965] 2 Ex. C.R. 480 at page 482:
| . . . the questions objected to may raise matters which are relevant to issues raised on the pleadings. This is all that the defendants are required to show. As to whether or not they are relevant and admissible at the trial is a matter for the learned trial judge. |
It should be noted that the Sydney Steel Corp. case was decided under the previous Federal Court Rules, however, subsection 240(a) is for our purposes, the same as the previous Rule 458(1)(a).
| [6] There has been a tendency by this Court to allow broad discovery, subject to |
certain limitations to which I will refer later. In Crestbrook Forest Industries Ltd. v. Canada, [1993] 3 F.C.A. 251 Isaac C.J., as he then was, stated at page 265:
An historical outline of the evolution of the discovery process (including the practice of examining corporate parties through their officers) can be found in the judgment of Osler J.A. in Leitch v. Grand Trunk R.W. Co. (1890), 13 P.R. 369 (Ont. C.A.), but in Irish Shipping Ltd. v. The Queen [1974] 1 F.C. 445 (T.D.), Collier J. succinctly captured the rationale underlying the framing of the rules pertaining to examination for discovery in such broad language. At page 449, he said:
| The tendency in the Courts of this country in recent years has been to provide all litigants with full and complete discovery prior to trial and to remove as much as possible what used to be known as the "ambush" tactics of the adversary system. In my view that is the general intention of the Federal Court Rules . |
| Similarly, in Champion Truck Bodies Ltd. v. R.. [1986] 3 F.C. 245 (T.D.) Strayer J. said at page 247: |
| It is in the interests of justice that examinations for discovery should be complete and this implies that the questioning should be as relevant as possible. The object is to explore fully the issues raised by the pleadings, to understand the position of the party being examined and to gain admissions from him. This is all in furtherance of the goal of narrowing the issues and reducing as much as possible matters to be determined at trial. |
| [7] However, as stated earlier, there are some limitations on the bounds of discovery. |
McNair J. in Reading & Bates Construction Co. v. Baker Energy Resources Corp. (1989), 24 C.P.R. (3d) 66 (F.C.T.D.) stated some of these limitations at pages 70 - 72:
1. The test as to what documents are required to be produced is simply relevance. The test of relevance is not a matter for the exercise of the discretion. What documents parties are entitled to is a matter of law, not a matter of discretion. The principle for determining what document properly relates to the matters in issue is that it must be one which might reasonably be supposed to contain information which may directly or indirectly enable the party requiring production to advance his own case or to damage the case of his adversary, or which might fairly lead him to a train of inquiry that could have either of these consequences: Trigg v. MI Moves Int"l Transport Services Ltd. (1986), 13 C.P.C. (2d) 150 (Ont. H.C.); Canex Placer Ltd. v. A.-G. B.C. (1975), 63 D.L.R. (3d) 282, [1976] 1 W.W.R. 644 (B.C.S.C.); and Compagnie Financière et Commerciale du Pacifique v. Peruvian Guano Co. (1882), 11 Q.B.D. 55 (C.A.).
2. ...
3. The propriety of any question on discovery must be determined on the basis of its relevance to the facts pleaded in the statement of claim as constituting the cause of action rather than on its relevance to facts which the plaintiff proposes to prove to establish the facts constituting the cause of action. Additionally, where a reference has been directed, the application of Rule 465(15) requires that the answers on discovery be restricted to questions as to facts that may prove or tend to prove or disprove or tend to disprove any unadmitted allegation of fact placed in issue on the reference: Armstrong Cork Canada Ltd. v. Domco Industries Ltd. (1983), 71 C.P.R. (2d) 5, 48 N.R. 157 (F.C.A.).
4. The court should not compel answers to questions which, although they might be considered relevant, are not at all likely to advance in any way the questioning party"s legal position: Canex Placer Ltd. v. A.-G. B.C., supra ; and Smith, Kline & French Laboratories Ltd. v. A.-G. Can. (1982), 67 C.P.R. (2d) 103 at p. 108, 29 C.P.C. 117 (F.C.T.D.).
5. Before compelling an answer to any question on an examination for discovery, the court must weigh the probability of the usefulness of the answer to the party seeking the information, with the time, trouble, expense and difficulty involved in obtaining it. Where on the one hand both the probative value and the usefulness of the answer to the examining party would appear to be, at the most, minimal and where, on the other hand, obtaining the answer would involve great difficulty and a considerable expenditure of time and effort to the party being examined, the court should not compel an answer. One must look at what is reasonable and fair under the circumstances: Smith, Kline & French Ltd. v. A.-G. Can., per Addy J. at p. 109.
6. The ambit of questions on discovery must be restricted to unadmitted allegations of fact in the pleadings, and fishing expeditions by way of a vague, far-reaching or an irrelevant line of questioning are to be discouraged: Carnation Foods Co. Ltd. v. Amfac Foods Inc. (1982), 63 C.P.R. (2d) 203 (F.C.A.); and Beloit Canada Ltée/Ltd. v. Valmet Oy (1981), 60 C.P.R. (2d) 145 (F.C.T.D.).
The above is a general statement of the laws respecting discovery.
Law Respecting Standard of Review
| [8] The law with respect to the standard of review of discretionary orders of the |
prothonotary is set out by the Federal Court of Appeal in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C.A. 425 at page 454:
I am in agreement with counsel for the appellant that the proper standard of review of discretionary orders of prothonotaries in this Court should be the same as that which was laid down in Stoicevski for masters in Ontario. I am of the opinion that such orders ought to be disturbed on appeal only where it has been made to appear that
(a) they are clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of the facts, or
(b) in making them, the prothonotary improperly exercised his discretion on a question vital to the final issue of the case.
In each of these classes of cases, the Motions Judge will not be bound by the opinion of the prothonotary; but will hear the matter de novo and exercise his or her own discretion.
Analysis and Findings
| [9] The prothonotary was called upon to rule on three general issues and on a number |
of outstanding questions found in schedules A4 and B4 of the agreement.
| [10] The first general issue dealt with by the prothonotary was the scope which should |
be given to paragraph 2(3) of the agreement reached by the parties dated March 15, 1999. Paragraph 2(3) reads as follows:
- . With respect to the questions in Schedule A2 and B2, the parties will provide:
(1) . . .
(2) . . .
(3) all purchase orders and invoices for the first purchase and sale by the parties or the earliest which can be located of at least each class of personal accessories. (Remo is suggesting that this apply to each item).
| [11] In relation to paragraph 2(3) the parties took different positions: |
| (a) The plaintiff took the position that what should be provided was "all purchase orders and invoices for the first purchase and sale by the parties or the earliest which can be located with respect to each item of personal leather accessories disclosed or illustrated in the production documents of the parties." |
| (b) The defendants" position was that they provide all purchase orders and invoices for the first purchase and sale by the parties or the earliest of which can be located of at least each class of personal accessories. |
| [12] The prothonotary adopted the plaintiff"s position. I agree with the reasoning and |
decision of the prothonotary. A review of paragraph 11 of the Statement of Defence shows that the defendants have put in issue the extent and timing of its sales. It is important for the plaintiff to know when the defendants first sold each item or if in fact they sold every item as they alleged. The appeal of the prothonotary"s decision in relation to paragraphs 18 and 20 is dismissed.
| [13] The second general issue relates to paragraph 2(c) of the agreement. The question |
is whether the parties must obtain production of sales documents of dealers and retailers (paragraphs 22 and 23 of his decision). The prothonotary ruled that:
[22] I take it that a contractual relationship must exist between the Defendants and their dealers. Therefore, it can be said that some form of connection exists between them. Consequently, for the purpose of paragraph 2(c) of the Agreement, it appears reasonable to order that the Defendants will be obliged to call upon each of the Jaguar dealers in Canada to produce representative invoices of their sales of personal leather accessories for the years 1981 to the present. Should any of the dealers fail to comply, the Defendants shall state so in an affidavit to be filed by them.
[23] I do not consider in this case that the probative value which may be offered by the documents sought would be outweighed by the time and expense in obtaining them. However, I believe that this would be the case if the Plaintiff were requested to seek the same information from its retailers. Indeed, the Defendants have eighteen dealers in total, whereas the Plaintiff appears to have over a thousand retailers. In addition, for all intents and purposes, the Plaintiff"s retailers would be third parties in regard to the Plaintiff without any contractual relationship with it.
| [14] I do not believe that the prothonotary is completely correct when he stated that a |
contractual relationship must exist between the defendants and their dealers. In fact, the Reply Affidavit of Vivien Shortt (Jaguar Motion Record, page 112, paragraph 6) states:
"None of the dealers is related to or controlled by share ownership by Jaguar. Jaguar cannot require production of documents or information from its dealers."
| [15] This set of facts is different than the factual relationship in the line of authorities |
that required persons being examined on behalf of corporate parties to answer questions in connection with the activities of other affiliates or companies controlled by it. (See Chestbrook Forest Industries Ltd. v. Canada, [1993] 3 F.C. 251 (F.C.A.)). In the present case, the parties from which documents are being sought are in effect non-parties to the action. The Federal Court Rules, 1998 make provision for production of documents from these non-parties in Rule 233(1):
| Production from non-party with leave 233. (1) On motion, the Court may order the production of any document that is in the possession of a person who is not a party to the action, if the document is relevant and its production could be compelled at trial. |
Production d"un document en la possession d"un tiers 233. (1) La Cour peut, sur requête, ordonner qu"un document en la possession d"une personnne qui n"est pas une partie à l"action soit produit s"il est pertinent et si sa production pourrait être exigée lors de l"instruction. |
| [16] There is no doubt that the documents requested are relevant as the defendants |
have pleaded sales of the goods in Canada. Although the discovery rules are to be interpreted broadly, there is a need to apply a specific rule to a certain set of facts if those facts fit the rule. Here we have the dealers, who are non-parties, specifically covered by Rule 233(1). It is my opinion that it is an error of law to order the dealers" documents to be produced by the plaintiff when Rule 233(1) sets out a simple process to obtain the documents of a non-party. I would therefore reverse the prothonotary"s decision with respect to paragraph 22 and rule that the defendants need not produce the sales documents of its dealers or retailers.
| [17] The same reasoning applies to the sales documents of the plaintiff"s dealers and |
retailers. Consequently, I agree with the prothonotary"s conclusion that the plaintiff need not produce the sales documents of its retailers and dealers.
| [18] The parties informed me at the hearing of the motion that Ground 3 of the |
appeal had been withdrawn. This dispenses with Category A (paragraph 29 of decision).
| [19] Ground No. 4 - Whether the defendants must disclose their suppliers" names. |
The prothonotary ruled as follows, relating to Category B and D-2:
Category B
| [30] I am of the view that the questions in this category shall be answered provided that a confidentiality order is requested and obtained from this Court. These questions seek information on whether some leather products were in fact sold in Canada by the Defendants. The information requested is therefore relevant. |
| [36] As for question 2910 in subcategory entitled "Supply", I am of the view that it is relevant and that it shall be answered under a confidentiality order, provided one is granted. |
I have reviewed the questions in issue under this category and the questions seem to relate more to whether the defendants purchased goods from suppliers. However, this information may advance the plaintiff"s case and damage the defendants" case as it is conceivable that if no purchases were made, no sales occurred. As well, the information may set a time frame to show when sales of these products could have been made by the defendants in the sense that sales would occur at about the time of the purchases or some time thereafter. Thus, this information could fairly lead to a train of inquiry that could advance the plaintiff"s claim or damage the defendants" claim. I therefore conclude that the prothonotary was correct in his decision and I would not allow this ground of appeal.
| [20] Ground No. 5 - Typographical errors re: Schedule A4 of the agreement. |
The parties agree that in Category C of Schedule A4, the question number should be 2999 and not 599 and I would so order (See J.M.R., page 64) that in paragraph 31 of the prothonotary"s decision (J.M.R., page 101), line 1, the number "599" be changed to "2999".
| [21] Ground No. 6 - Whether Remo should supply buying agent information. |
The prothonotary"s finding on this point is contained in paragraph 39 of his decision and is referred to Category 6 of Schedule B4 (R.M.R., page 069). The questions in issue are questions 622, 1671 N and 16710 and the prothonotary ruled as follows:
| [39] Questions 622, 1671 N and 16710 need not be answered on the grounds of irrelevancy since I fail to see how the names of Remo"s buying agents would likely throw any light on any relevant issues including the quality of the products. |
I have studied these questions and I am in agreement with the prothonotary. These answers would not assist the defendants in advancing their own case or damaging the plaintiff"s case, nor would they lead them to a train of inquiry that would have either of the first two consequences. This decision of the prothonotary was not based on any wrong principle or upon a misapprehension of the facts.
| [22] Ground No. 7 |
According to Jaguar, four questions for which answers were sought under this category (question nos. 1694; 1771; 1774; 1796 were omitted from the prothonotary"s ruling through an inadvertent error. With respect to the questions which were referred to in this portion of the ruling (question nos. 1475B; 1498; 1550; 1555; 1557; 1617 and 1798), the questions were ordered answered. Remo, however, alleges that the relevancy of the questions was argued before the prothonotary and that the questions were therefore not "omitted" but were considered and, by their absence from the ruling, were not ordered answered. Given the ambiguity on this aspect of the appeal, I will consider the merits of the four questions de novo .
| [23] In argument before me, counsel for both parties referred to question 1694 as |
requesting that Remo "Produce any other documents covering purchases from manufacturers of Jaguar products for the years in question." Question 1694, however, asks no such thing. From page 753 of Volume 3 of the Supplement to the Jaguar Motion Record, question 1694 asks the Remo representative:
"How you promoted Remo, and in particular the trade mark Jaguar to those customers?"
| [24] Jaguar did not argue the subject matter of question 1694 before me, but argued for |
the production of documents from Remo manufacturers. Therefore, I have considered that argument only. I am satisfied that Remo has indicated to Jaguar that it has provided all the documentation it possesses with respect to purchases from manufacturers. And with respect to the remaining questions 1771, 1774, 1794, I am also satisfied that Jaguar has answers to those questions. Remo has answered the questions to the extent of its capability.
| [25] Ground No. 8 |
The prothonotary ruled as follows on Category 19, question 462:
Category 19
| [47] Question 462 is irrelevant and need not be answered. |
Question 462 reads as follows:
"Check with Remo staff and determine whether they are aware car companies offer accessory products to their customers?"
Counsel have agreed that question 462 would be answered and I would so order.
| [26] Ground No. 9 |
The prothonotary"s ruling with respect to question 733 was:
Category 19
| [48] Question 733 asks for opinions and need not be answered. |
Question 733:
"Advise as to whether there are any documents, facts or information contrary to the suggestion that car companies would respond into areas such as car and personal accessories."
I would agree with the prothonotary"s ruling on this question. Before the witness could answer this question, the witness would have to form an opinion that the documents, facts or information were contrary to the suggestion that car companies would expand into areas such as car and personal accessories.
| [27] As success has been divided, there shall be no order as to costs on this motion. |
ORDER
| IT IS HEREBY ORDERED that the appeal be allowed to the extent noted in |
the reasons given above.
IT IS FURTHER ORDERED that there shall be no order as to costs as success has been divided.
"John A. O"Keefe"
J.F.C.C.
Toronto, Ontario
March 28, 2000
FEDERAL COURT OF CANADA
Names of Counsel and Solicitors of Record
| COURT NO: T-1473-91 |
| STYLE OF CAUSE: REMO IMPORTS LTD. |
| -and- |
| JAGUAR CANADA INC. and |
JAGUAR CARS LIMITED
| DATE OF HEARING: WEDNESDAY, SEPTEMBER 29, 1999 |
| PLACE OF HEARING: TORONTO, ONTARIO |
REASONS FOR ORDER
| AND ORDER BY: O"KEEFE J. |
DATED: TUESDAY, MARCH 28, 2000
APPEARANCES: Mr. Richard Uditsky
For the Plaintiff
Mr. Douglas Wilson
For the Defendants
| SOLICITORS OF RECORD: Mendelsohn Rosentzveig Shacter |
| Barristers & Solicitors |
| 1000 Sherbrooke St. W., 27th Floor |
Montreal, Quebec
H3A 3G4
| For the Plaintiff |
Lang Michener
Barristers & Solicitors
P.O. Box 747
Suite 2500
BCE Place
181 Bay Street
Toronto, Ontario
M5J 2T7
| For the Defendants |
| FEDERAL COURT OF CANADA |
Date: 20000328
Docket: T-1473-91
Between:
| REMO IMPORTS LTD. |
Plaintiff
| -and- |
| JAGUAR CANADA INC. and |
JAGUAR CARS LIMITED
Defendants
REASONS FOR ORDER
| AND ORDER |