Date: 20100419
Docket: T-887-08
Citation: 2010 FC
421
Ottawa, Ontario, April 19, 2010
PRESENT: The Honourable Mr. Justice Mosley
BETWEEN:
CANADIAN
SUPPLEMENT TRADEMARK LTD.
Applicant
and
M. FRANK PETRILLO
Respondent
REASONS FOR ORDER AND ORDER
[1]
This is an
appeal of the order of Prothonotary Aronovitch, dated September 10,
2009, in which she denied a motion by the applicant, Canadian Supplement
Trademark Ltd. (CSTL), to convert the underlying application into an action or
to order the respondent, Mr. Petrillo, to provide oral testimony at the hearing
of the application. The applicant is appealing only the refusal to order that
Mr. Petrillo testify.
[2]
The
motion arose in the context of an
application by CSTL, commenced on June 25, 2008, to expunge a registered
trade-mark for NYTRO TECH NUTRITION & Design, owned by Mr. Petrillo. Following
the filing of that application, Mr. Petrillo brought an action against CSTL for
trade-mark infringement in Federal Court File No. T-1535-08. On December 11,
2008, Prothonotary Milczynski stayed the infringement action upon the close of
pleadings, until final determination of the expungement application.
DECISION UNDER APPEAL:
[3]
Before Prothonotary
Aronovitch, the
applicant sought
to find a means to allow viva voce evidence to be presented regarding
the key fact in dispute
between the parties, namely the date of first use of the respondent’s
trade-mark. The applicant contended that Mr.
Petrillo's evidence was inconsistent with that given in the infringement
action, and other proceedings related to the trade-mark brought before the
Québec Superior Court and an unrelated opposition proceeding. These
inconsistencies would be difficult to reconcile on the basis of a paper record, the
applicant submitted, and the interests of justice would be best served by
having Mr. Petrillo cross-examined before a judge, who would then be in a
position to assess his demeanour as a witness and weigh the evidence: Macinnis v.
Canada (Attorney General) (C.A.), [1994] 2 F.C. 464, [1994] F.C.J. No.
392, at para. 9.
[4]
The applicant offered
three potential vehicles for the presentation of viva voce evidence: i)
conversion of the present application to an action; ii) a trial on the issue of
Mr. Petrillo's credibility;
or,
iii) allowing viva voce evidence in the context of the application. Prothonotary
Aronovitch considered that none of these vehicles were available to the
applicant.
[5]
Citing Canadian
Private Copying Collective v. Fuzion Technology Corp., [2005] F.C. 1557, [2005] F.C.J.
No. 1915, (“Fuzion
Technology”) where the question arose in the context of a proceeding
brought under subsection 34(4) of the Copyright Act, Prothonotary
Aronovitch held that a
proceeding to expunge a trade-mark is not “an application or reference to the
Federal Court under any of sections 18.1 to 18.3” (subsection 18.4(1) of
the Federal Courts Act). Section 58 of the Trade-marks Act makes
no provision for the conversion of an application into an action. Similarly,
she concluded, a Rule 107 trial of an issue was not available outside the
context of an action.
[6]
While an application
and action may be consolidated for the purposes of hearing, the prothonotary
considered that it was not justified or warranted in the circumstances. The
infringement action was not well advanced in comparison to the application, the
parties had agreed to a stay upon completion of the pleadings and the effect of
consolidation would be to unnecessarily delay the application. Final
disposition of the application would limit or eliminate the basis for the
infringement action. All of the factors considered militated in favour of an
early hearing of the application.
[7]
The prothonotary
addressed what she described as “the further issue of whether viva voce evidence
should be permitted in the context of this application pursuant to Rule 316”.
She concluded that the applicant had not made out the “special circumstances”
required by the rule.
The
mere fact that the documentary evidence may contain contradictions was an insufficient
basis as the Court often sorts out conflicting evidence of this nature in
judicial review proceedings: Misquadis v. Canada (Attorney General), 2000
CanLII 16230, [2000] F.C.J. No. 1488. There was nothing in the
circumstances of this case, in her view, that required a departure from the
ordinary practice as to the manner in which evidence is given on an
application.
[8]
At the hearing of the
motion, counsel for the applicant had confirmed that she did have an
opportunity to cross-examine on the apparent contradictions but submitted that
new information had come to her attention after the cross-examinations were
completed. Prothonotary Aronovitch found that the applicant had had an adequate
opportunity to proffer the evidence in documentary form. Nonetheless, she
considered that it would be appropriate and just to allow the applicant a
further opportunity to challenge Mr. Petrillo’s credibility by putting this new
information to him. Accordingly, the prothonotary granted leave to recall Mr.
Petrillo for further cross-examination “for the limited purpose of examining on
new facts or documents which came to the attention of the applicant following
the close of cross-examinations on affidavits…”
[9]
This
cross-examination was to be completed by October 8, 2009 and the prothonotary’s
order also set out firm dates for completing the remaining stages of the
application. During the cross-examination which took place at Montreal, the respondent, through his counsel, objected to and
declined to answer questions pertaining to information that “came before
February 10, 2009”.
THE STANDARD OF REVIEW:
[10]
The standard of
review on this appeal is that formulated by the Federal Court of Appeal in Canada v.
Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.), [1993] F.C.J. No.
103 and restated in Merck & Co. v. Apotex Inc., (2003), 315 N.R.
175, [2003] F.C.J. No. 1925, as follows:
Discretionary orders of prothonotaries
ought not to be disturbed on appeal to a judge unless:
a. the questions in the motion
are vital to the final issue of the case, or
b. the orders 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 facts.
[11]
In
my view, the questions raised in the motion are not vital to the final issue of
the case as they do not go to the ultimate resolution of the expungement application
but rather to the manner in which evidence is to be put before the applications
judge on a collateral issue, the credibility of a witness.
ISSUE:
[12]
The
sole issue, therefore, is whether Prothonotary Aronovitch was “clearly
wrong” in refusing to order either the trial of an issue or that Mr. Petrillo
testify viva voce at the hearing of the expungement application
regarding the use of his registered trade-mark.
ANALYSIS:
Section
58 of the Trade-marks Act makes no provision for conversion
[13]
In rendering my
decision as to whether Prothonotary Aronovitch was “clearly wrong” in refusing
to order either the trial of the issue of credibility or that Mr. Petrillo
testify viva voce at the hearing of the application, I note that the
applicant is not appealing the prothonotary’s refusal to convert the
expungement application into an action. I take into consideration however, that
the applicant asserts that the refusal to convert the application into an action
was an error of law which coloured the remainder of the prothonotary’s decision
in refusing to order viva voce evidence from the respondent, Mr.
Petrillo. While I do not need to decide that question in light of the position
taken by the applicant on this appeal, I am not persuaded that the
prothonotary’s determination of the issue influenced her consideration of the
alternatives advanced by the applicant.
[14]
I note that
Prothonotary Aalto arrived at a different result on conversion of an application
for infringement of a copyright in Havana House Cigar & Tobacco
Merchants Ltd. v. Worldwide Tobacco Distribution Inc., (2008), 73 C.P.R.
(4th) 131, [2008] F.C.J. No. 1828. That case is distinguishable as it was an
application for copyright infringement commenced under subsections 27(1) and 27(2)
of the Copyright Act, and was not brought pursuant to subsection 34(4),
as in Fuzion Technology, above, the decision discussed by Prothonotary
Aronovitch in her order. Prothonotary Aalto found in Havana House Cigar
& Tobacco Merchants Ltd., above, at paras. 16 and 21, that the application
should proceed by way of action as the proceeding was not simple, nor straightforward,
and there was a requirement to avoid a multiplicity of proceedings involving
essentially
the same parties and issues and the risk of inconsistent results and the
inadequacy of affidavit evidence.
[15]
In the case at bar,
however, the lack of evidence submitted by the applicant as to why the
conversion should take place appeared to be the underlying consideration in
denying the conversion: Havana House Cigar & Tobacco Merchants Ltd.,
above, at paras. 18, citing Euro-Excellence Inc. v. Kraft Canada Inc., 2007
SCC 37, [2007] S.C.J. No. 37. Also, I note that the evidence is straightforward
and uncomplicated. Further, and specifically to the Trade-marks Act, I
do not find that Prothonotary Aronovitch erred when she found that where the
only relief sought is to have a trade-mark expunged, it appears that Parliament
has provided one vehicle for proceeding: an application. I agree with the
Prothonotary that even if conversion was available, it is doubtful that it
would be justified especially at this stage of the proceeding, on the grounds
and for the reasons asserted by the applicant. I am of the view that final
disposition of this application will limit or eliminate the basis for the
infringement action. This militates in favour of an early hearing of the
application.
[16]
I agree with the
respondent that there is nothing in the reasons for the order which suggest
that the prothonotary failed to consider the introduction of viva voce
evidence independently from the issue of conversion. The prothonotary
considered the possibility of introducing oral evidence into the present application
on two other grounds: a trial on the issue of Mr. Petrillo’s credibility under
Rule 107 of the Federal Courts Rules and the introduction of viva
voce evidence through the application of Rule 316.
Rule
107 for a trial on the issue of credibility not available under this application
[17]
Before Prothonotary
Aronovitch, the applicant sought to have a trial on the issue of Mr. Petrillo’s
credibility in the form of live testimony on the use of the registered
trade-mark. Arguing that the Court should order a trial of an issue in this
case, I note that the applicant cited only cases that arose in the context of
an action and not in the context of an application: Illva Saronno S.p.A. v.
Privilegiata Fabbrica Maraschino "Excelsior" (T.D.), [1999] 1
F.C. 146, [1998] F.C.J. No. 1500, at para. 14; Merck & Co. v. Brantford
Chemicals Inc., 2004 FC 1400, [2004] F.C.J. No. 1704, at paras. 7 &
10.
[18]
Prothonotary
Aronovitch acknowledged the absence of jurisprudence directly on the point of the
use of Rule 107 in the context of an application. In her view, it was
appropriate to apply the reasoning in Justice Hughes’ decision in Fuzion
Technology, above, given that an application is designed to proceed
summarily. In that case, a similar question arose in the context of a proceeding
brought under the Copyright Act and Justice Hughes concluded, at
paragraph 13, that a Rule 107 trial of an issue was not available under an
application pursuant to subsection 34(4) of the Copyright Act. Subsection
34(4) of the Copyright Act resembles the legislative provision at issue,
subsection 59(3) of the Trade-marks Act, which also indicates that
proceedings on an appeal or application shall be heard and determined
summarily.
[19]
Were Rule 107 of the Federal
Courts Rules available, it would effectively allow a portion of the
application to be converted into a de facto action. I find no reason to
intervene in the
prothonotary’s
determination that the applicant offered no authority to support the
proposition that Rule 107 should be applicable to non-actions, as in this case.
No
exceptional circumstances justifying viva voce evidence in this application
[20]
I recognize that this
Court has noted that the ability to hear viva voce testimony and to
observe a person’s demeanour in the witness box is an “irreplaceable tool
[which is] vital to the performance of the function of a trier of fact.”: Apple
Computer, Inc. v. Mackintosh Computers Ltd. (F.C.A.), [1988] 3 F.C. 277,
[1988] F.C.J. No. 237, at para. 8; Eli Lilly Canada Inc. v. Apotex Inc.,
2009 FC 320, [2009] F.C.J. No. 413, at para. 19. I would only observe that in
recent years, the value of demeanour evidence has been brought into question.
The reality is that no one, including judges, can do better than chance in
assessing credibility solely on demeanour. Credibility is best determined by
assessing the entire record and, in particular, any inconsistencies that there
may be in the witness’s evidence.
[21]
In this case, the
evidence is straightforward and uncomplicated and relates to allegedly
ambiguous statements regarding the date of first use of NYTRO TECH NUTRITION
& Design, within a range of “late 1997 to the beginning of 1998.” The
credibility of these statements and the witness who made them is capable of
being determined on the evidence in the record.
[22]
Accordingly, I do not
find that Prothonotary Aronovitch was clearly wrong when she determined that
the fact that this type of evidence appears in the record could not be
considered a special or exceptional circumstance as defined in section 316 of
the Federal Courts Rules.
She
cited the decision of Justice MacKay in Holland
v. Canada (Attorney General), (1999), 93 A.C.W.S. (3d) 403, [1999]
F.C.J. No. 1849, at para. 3, incorporating the following quote from Justice
Rouleau in Glaxo Canada Inc. v. Canada (Minister of National Health &
Welfare), (1987), 15 C.P.R. (3d) 482, 11 F.T.R. 132, at 133:
… It is only "by leave of the
Court" and "for special reason" that a witness can be called to
testify in relation to an issue… In my opinion, this is a question to be
decided on the facts of a particular case with the onus being on the applicant
to prove the existence of "special reason" to the satisfaction of the
Court. What is clear from the jurisprudence is that leave will be granted by
the Court only in exceptional circumstances. [My Emphasis]
[23]
As was found by
Prothonotary Aronovitch, I agree that the fact that documentary evidence may
contain contradictions has been rejected as a basis for allowing viva voce
evidence in an application and that this Court in judicial review proceedings
often sorts out conflicting evidence: Misquadis v. Canada (Attorney General),
above, at para. 14.
[24]
In the present
instance, I am not convinced that affidavit evidence, in addition to the
prothonotary’s order granting leave to the applicant to continue with a further
round of cross-examination of Mr. Petrillo for the purpose of examining new
facts or documents going to credibility, will be inadequate: Edgar v.
Kitasoo Band, 2003 FCT 815, [2003] F.C.J. No. 1078, at para. 17. The
present situation is not one which embodies the clearest of circumstances
demonstrating that live evidence is necessary. I find that the affidavit
evidence combined with the further round of cross-examination, is sufficient
for the Court to determine the matter: Edgar, above, at para. 15.
[25]
I also find that
Prothonotary Aronovitch correctly relied on Condo v. Canada (Attorney General), 2004 FC 885, [2004] F.C.J. No. 1077, at
para. 16, to indicate that this Court has declined to find special circumstances
justifying viva voce evidence where a party, as in the case of the
applicant, had adequate opportunity to proffer the evidence in documentary
form.
[26]
I note that the
respondent argues that the applicant has been given ample chance to
cross-examine Mr. Petrillo and has already taken advantage of the
prothonotary’s decision to allow for a second cross-examination of Mr.
Petrillo, and in doing so has benefited from an even greater opportunity to
examine Mr. Petrillo as would have been provided to it under a strict
interpretation of Rule 316 of the Federal Courts Rules.
[27]
Having read the
transcript of the further cross-examination that took place on October 8, 2009,
I agree with the applicant that the respondent adopted an unduly restrictive interpretation
of Prothonotary Aronovitch's order. Counsel for the respondent objected to any
question pertaining to information which pre-dated the previous
cross-examination of Mr. Petrillo. It is apparent from the terms of the order that
Prothonotary Aronovitch granted leave for further cross-examination on any
information that came to the attention of the applicant following the
close of cross-examinations and not just that which may have existed prior to
that date. However, the question before me is whether the Prothonotary erred in
issuing the order and not whether the respondent properly complied with it. In
any event, this issue may be raised before the applications judge who will hear
the matter and the judge may draw any inference he or she deems appropriate
from the refusal of the respondent to answer the questions.
[28]
I am of the view that
this Court currently has before it an adequate record of the evidence it needs
to adequately dispose of the substantive issues raised in the present
application.
[29]
Overall, I do not
find that Prothonotary Aronovitch erred in principle or misapprehended the
facts in (1) refusing to order the trial of the issue of credibility and (2)
refusing to order that Mr. Petrillo testify viva voce at the hearing of
the application. Accordingly, I find that there is no reason in this case to
intervene.
[30]
While costs would
normally be awarded to the respondent in light of this result, I will exercise
my discretion in this matter not to award them.
[31]
The applicant’s
appeal must be dismissed.
ORDER
THIS COURT ORDERS that:
- the applicant is granted leave to
amend the Notice of Motion dated September 21, 2009 in accordance with the
amendments set out in the Amended Notice of Motion filed on January 8,
2010;
- the applicant’s appeal is dismissed;
- the parties will bear their own
costs.
“Richard
G. Mosley”
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