Date:
20100804
Docket:
T-970-08
Citation:
2010 FC 798
[ENGLISH
TRANSLATION]
Montréal, Quebec, August 4, 2010
PRESENT:
Richard Morneau, Esq., Prothonotary
BETWEEN:
OCEANEX
INC.
Plaintiff
and
PRAXAIR CANADA INC.
and
THE OWNERS AND ALL OTHERS
INTERESTED IN
THE TANKTAINER “C-156” EX THE
SHIP M.V. “CABOT”
and
THE
TANKTAINER “C-156” EX THE SHIP M.V. “CABOT”
Defendants
AND BETWEEN:
PRAXAIR
CANADA INC.
Plaintiff
by counterclaim
and
OCEANEX
INC.
Defendant
by counterclaim
REASONS
FOR ORDER AND ORDER
[1]
This
is a motion by the defendant Praxair Canada Inc. (Praxair) to continue the
examination for discovery of representatives of Oceanex Inc. (Oceanex), seeking
the adjudication of the objections raised at that time, and finally, the
production by Oceanex of a more complete affidavit of documents.
[2]
The
examination for discovery of Oceanex representatives took place on February 12,
2009, for Michel Parent and on February 13, 2009, for Daniel Turcotte. There
was then a written exercise between the parties consisting essentially of
Oceanex answers to undertakings, follow-up questions by Praxair and answers to
those additional questions, ending on about March 4, 2010. That was followed by
the current motion by Praxair. It must be noted right away that, after weighing
the arguments of all the parties, I do not find that this motion is late and
that it must be dismissed on that basis.
[3]
That
said, the basic dispute between the parties is essentially based on the
following context.
[4]
Oceanex
is suing Praxair for damages that were allegedly caused to its ship, the M.V. “Cabot”
on or about December 15, 2007, when liquid oxygen escaped from container C‑156
owned by Praxair (the Container).
[5]
In
return, Praxair is suing Oceanex in a counterclaim for damages to the Container
during handling or transportation of the Tank by Oceanex or by third parties
acting under the direction or authority of Oceanex, essentially stevedores in
Montréal or St. John’s Newfoundland.
[6]
For
the remainder, following is a more detailed narrative of the relevant
circumstances found in the written submission by Praxair:
1.
Praxair
produces industrial gases including liquid oxygen. Throughout 2006 and 2007,
including the last shipment on December 11, 2007, Praxair contracted with
Oceanex to transport its cryogenic container identified as C‑156 loaded
with liquid nitrogen or oxygen from Montreal to St. John’s Newfoundland.
2.
The
container was only used on the Montreal – St. John’s transportation rum
and was only carried by sea by Oceanex. The Bickerdike terminal in Montreal is
operated by Empire Stevedoring who was at all material times Oceanex’s
contractor hired to receive and load cargo on Oceanex’s ships. Oceanex has an
office at the Bickerdike Terminal and employees who work there.
M. Parent transcript
p. 51
Answer
to undertaking 16
3.
The
container C‑156 had been returned empty to Montreal by Oceanex on
November 26, 2007 from the previous shipment and had been sitting in a
storage area at the Bickerdike terminal since then. On December 10 [2007],
Praxair booked C‑156 with Oceanex to be carried to St. John’s.
Oceanex made arrangements with Empire Stevedoring for C‑156 to be placed
on a trailer supplied by Empire Stevedoring by a top lift operated by an
employee of Empire and a trucker hired by Oceanex hauled it outside the
terminal. On December 11 a trucker employed by Oceanex brought C‑156
to Praxair’s filling station in Montreal where the container was filled with
liquid oxygen by Praxair, and the trucker returned the container to the
terminal. The container was loaded on the “Cabot” on December 11 by Empire
Stevedoring together with other cargo for Oceanex, and was carried to
St. John’s Newfoundland.
M. Parent transcript
pages 92‑94
Answer
to undertakings 21, 27, 30, 38, 40
4.
On
December 15, 2007 the container was discharged by stevedores employed by the
St. John’s Shipping Association, of which Oceanex is a member. The
stevedoring gangs were hired by Oceanex and supervised by Oceanex supervisors.
Oceanex operates the terminal in St. John’s where the container was
discharged.
M. Parent transcript pages
Answer
to undertakings 50, 70
5.
On
the morning of December 15, 2007 after the container had been placed on
the pier in St. John’s, Praxair was advised by Oceanex that the container
was leaking.
[7]
More
specifically for the purposes of this motion, Praxair argues that neither of
the parties is able to establish the day or time when the Container was damaged
and began leaking. However, it is clear according to Praxair that the Container
was damaged during transportation. The piping and base of the Container
allegedly suffered an impact and Praxair argues, primarily based on a letter
dated January 15, 2008, from the Container’s manufacturer, CVA, that the
Container apparently somehow fell from a certain height, causing a valve on the
container to rupture.
[8]
What
any stevedore handling the Container at any time may have known was thus seen
by Praxair, and it must be agreed to a large extent, as relevant information.
Thus, despite the many documents submitted to date by Oceanex in its affidavit
of documents or in the written follow-up to complete the examination of its
representatives, the Court is not prepared to limit the relevant information to
essentially what happened on the ship M.V. Cabot during unloading in
Newfoundland.
[9]
For
the applicable principles regarding relevance, it is appropriate to refer to Reading
& Bates Construction Co. and al v. Baker Energy Resources Corp. and al (1988),
24 C.P.R. (3rd) 66, in which McNair J., in a general six-point
reminder, first defined in points 1 to 3 the parameters that make a question or
document relevant and then, in points 4 to 6, set out a series of circumstances
or exceptions that, in any case, in the end, are such that a question need not
be answered or a document need not be produced.
[10]
Moreover,
it is clear that one of the Oceanex representatives during examination for
discovery, Mr. Parent, did not know whether any stevedore had noticed a leak
when the Container was on the vessel “Cabot” in St. John’s Newfoundland. It
seems that some of the information in that regard was apparently provided by
Oceanex following that examination for discovery, in December 2009 and March
2010. However, more detailed information may be contained in stevedore reports.
Although Praxair acknowledges that those stevedores report to third parties in
the dispute, it considers that Oceanex is at least able to obtain the
information in question from them, due to its commercial relationships with
those third parties.
[11]
In
that regard, Praxair refers to Eli Lilly & Co. v. Apotex Inc., 2000
CarswellNat 185, in which the Court stated, at paragraph 5:
It
seems to me that where one may reasonably expect, because of a relationship
existing between a party and some third party, that a request for information
will be honoured. It is proper to require that party to make such a request. …
[12]
The
Court also agrees in principle with Praxair on this approach.
[13]
Despite
a directive from this Court dated May 31, 2010, referring the many difficulties
in the Praxair case that seem to separate the parties and the invitation by the
Court for the parties to try to reach an agreement on any or all of them, the
fact remains that, on reading the Oceanex reply record, a significant number of
difficulties still need to be addressed.
[14]
In
light of the comments above, and after hearing from counsel for the parties
during a half-day hearing, it is now time for a decision on the elements
separating the parties as part of this motion, essentially the undertakings by
Oceanex to which there have not yet been sufficient answers according to
Praxair.
[15]
We
will begin with the examination of Mr. Parent, and then that of Mr. Turcotte.
Any specific comments below by the Court under any of the elements is in
addition to the comments found under each element in the written submissions by
the parties. Consequently, if there are no comments by the Court, the Court has
relied on the written submissions by the parties in favour of or against a response.
Examination
of Mr. Parent
[16]
Additional
question (AQ) 6 must be answered.
[17]
The
documents produced by Oceanex as part of undertakings U7 and U8 can be the
subject of a written and concise examination by Praxair, to be served within
thirty (30) days of these reasons for order and this order and that examination
shall then be answered within thirty (30) days of being served.
[18]
AQ
9 and 10(a) and (b) do not need to be answered, as the events discussed in them
date back several years and Mr. Parent is no longer employed by Oceanex.
[19]
As
for AQ 16, and this also holds for AQs 29, 75(y), 76(h) and (l), 88
and 17(b) (under the examination of Mr. Turcotte and limited to his last known
address) — for the reasons cited by Praxair in its arguments numbered 1 to
4 on page 16 of its written submissions, these questions must be answered.
[20]
AQs 18(b)
and (c) and AQs 113(a) to (d) do not need to be answered for the following
reasons. The Court holds that, under the circumstances of this case, a search
for information possibly related to past events during the transportation by
Oceanex of other Praxair containers seems to lack similarities to the incident
at issue. If the documents raised by Praxair in additional questions regarding
three (3) past events were so relevant, Praxair should have included them in
its affidavit of documents in November 2008. The fact that, in examination, Mr.
Parent denied that such incidents occurred is not, in my view, a dynamic that
justifies Praxair examining those documents at a later time.
[21]
AQs 47,
65(a) and (b) and 70(b) must be answered. AQ 70(c) does not need to be answered
as such, but with the answer under AQ 70(b), Praxair could address the third
party to obtain an answer to AQ 70(c).
[22]
As
for AQ 74(b), the Court understands in the end, following a heated debate
between counsel at the hearing, that there are statements by stevedores for
which Oceanex claims a litigation privilege. However, the Court agrees with
Praxair when it states the following at the top of page 26 of its written
submissions under undertaking 75:
The
Oceanex Affidavit of Documents does not list, describe or disclose any
documents containing the statements of stevedores for which a privilege is
claimed, as required by Rule 223 (2) (ii) and (b). The
Defendant was only informed during the discovery that statements had been made
by undisclosed individuals to the effect that a leak had been observed on the
deck of the ship in Newfoundland, and the nature of the observations was
disclosed in the answer to the undertaking, some 2 years after the incident (…)
[23]
Consequently,
AQ 74(b) must be answered within thirty (30) days of these reasons for order
and this order by serving a supplementary affidavit of records in which, as
Appendix 2, Oceanex shall list the statements signed by stevedores, with their
names, for which Oceanex is claiming a litigation privilege.
[24]
In
this regard, I do not consider that paragraph 3 of Appendix 2 of the existing
Oceanex affidavit of documents is an indication that complies with the terms of
Rules 223(2)(a)(ii) and 223(2)(b) of the Federal Court Rules (the
Rules).
[25]
AQ
75(r) must be answered, but not AQ 75(w), as the person in question was not on
the vessel at the time of unloading. The information sought seems to me to be
too distant and the question irrelevant. The same reasoning applies to refuse
AQs 76(g), (h), (k) and (l) and 77(b).
[26]
As
for AQ 84, it seems to me that it has now been sufficiently answered and that
the additional information now sought by Praxair under arguments 1 and 2
on page 29 of its written submissions are not legitimate additional questions
arising from the original question 84.
[27]
AQ 124(b)
does not need to be answered as it is ultimately clear that the laboratory
report discussed in Court provides sufficient information.
[28]
AQ 124(c)
must be answered.
[29]
Objection
25 (page 33 of the written submissions from Praxair) is relevant and must be
answered. The incident in question is related to the transportation of liquid
air, like the case at hand.
Examination
of Mr. Turcotte
[30]
AQs 5(a)
and (b) must be answered. The same is true for AQs 17(a) and 18(a)
and (c).
[31]
All
the questions above that must be answered (for both Mr. Parent and Mr.
Turcotte) must be answered by Oceanex in writing within 30 days of these
reasons for order and this order. This exercise and any other measure ordered
after it shall conclude the examinations for discovery between the parties.
[32]
Moreover,
within forty-five (45) days of these reasons for order and this order, the
parties shall make every effort to reach an agreement and to transmit to
the Court a joint proposal for an order containing a timeline for the remaining
steps in this case.
[33]
Any
other remedies sought by Praxair in its motion that is not granted in these
reasons for order and this order are dismissed.
[34]
Given
that success is shared in this motion, no costs are awarded.
“Richard
Morneau”
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