Date:
20120709
Docket:
T-1715-10
Citation:
2012 FC 866
Toronto, Ontario, July 9, 2012
PRESENT: The Honourable Mr. Justice Near
BETWEEN:
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THE CANADIAN COPYRIGHT
LICENSING AGENCY ("ACCESS COPYRIGHT")
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Plaintiff
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and
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THREE CENT COPY CENTRE LTD. AND
ALL PERSONS CARRYING ON BUSINESS AT 732 SPADINA AVENUE AND/OR 917 BAY STREET,
TORONTO, ONTARIO
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Defendants
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REASONS FOR ORDER AND
ORDER
[1]
The
defendants in this action seek a declaration that the default judgment may not
be enforced against them, or, alternatively that the default judgment should be
set aside. I find that the defendants have not satisfied the applicable
test so as to entitle them to have the default judgment set aside nor have they
persuaded me in any way that the default judgment should not be enforced
against An Le and Anh Ly. As such, the motion will be dismissed.
I. Background
[2]
It
is conceded that at all material times, 1247714 Ontario Ltd., An Le and Ahn Ly
were persons carrying on a business, described as Three Cent Copy
Centre, at one or both copy shops located at 732 Spadina Avenue and 917 Bay Street in Toronto. The plaintiff became aware of possible activities at these
places of business that may have amounted to an infringement of their copyright
sometime in 2008.
[3]
As
a result the plaintiff contacted the defendants and demanded that they cease
and desist from such activities. The defendants through their counsel
advised counsel for the plaintiff that the proper name of the businesses at
these locations was Three Cent Copy Centre Ltd. Counsel for the plaintiff
undertook the proper corporate searches and had been unable to find a properly
registered corporate entity at these locations and relied upon the information
provided by counsel for the defendants who understood throughout that it was
their activities at these two places of business that were of concern to the
plaintiff.
[4]
Counsel
for the plaintiff and counsel for the defendants exchanged various
correspondence from 2008 to 2010 in an attempt to resolve the matter. Ultimately,
as no resolution seemed possible the plaintiff commenced an action and filed
and served the Statement of Claim in this matter in 2010.
[5]
The
defendants’ acknowledgement being served with the Statement of Claim and
retained new counsel to represent their interests. New counsel exchanged
various correspondence with counsel for the plaintiff and continued to
represent the corporate entity throughout as Three Cent Copy Centre
Ltd. These further attempts to resolve the issues continued throughout
2010 until August 2011 when the plaintiff sought default judgment against the
defendants as no statement of defence had been filed on behalf of the
defendants and the incidents of possible infringement had increased over that
time period.
[6]
Default
judgment issued on August 9, 2011.
II. Default Judgment
[7]
The
defendants now seek to set aside the default judgment on the basis that the
proper corporate entity is 1247714 Ontario Ltd and not Three Cents Copy
Centre Ltd. (and others) despite having clearly indicated to the plaintiff that
the proper name was indeed Three Cents Copy Centre Ltd.. In addition, this
falsehood was perpetuated throughout negotiations subsequent to the service of
the Statement of Claim. It is rather disingenuous that the defendants
now seek to have a default judgment set aside based on their own misrepresentations
and despite admitting that at all times that they were in fact the principals
behind this business and despite being clearly aware (having retained two separate
counsel to act on their behalf) that it was their activities that were the
subject matter of the litigation. There is no merit to such a position
and I reject it absolutely. The test to set aside a default judgment as
set out in many cases of this Court such as Setanta Sports Canada Limited v.
Gentile Enterprises Inc. et al, (2011) FC 64 is as follows:
a. Does the defendant have a
reasonable explanation for its failures to file a statement of
defence?
b. Does the
defendant have a prima facie defence on the merits? And
c. Has the defendant
brought this motion within a reasonable time?
[8]
Further,
the three elements of the test are conjunctive as set out in Contour Optil
Inc. v. E'lite Optik Inc.; 2001 F.C.J. No. 1952 at para. 4, and hence the
Court must be satisfied that all three elements have been met.
[9]
In
my view, there is simply no reasonable explanation for the defendants not to
have filed a statement of defence to this matter given their level of knowledge
of the proceedings as evidenced through their retention and instruction of counsel
throughout a considerable length of time. Further, no evidence of a prima
facie defence on the merits has been filed with the Court. The only
submission is that the defendants were not properly named in the Statement of
Claim which is totally without merit given their active participation in both
providing the incorrect corporate name and failing to take any measures to
correct this misleading and incorrect information. As such, the test to
set aside the default judgment has not been met and this part of the motion is
dismissed.
III. Setting aside the writ of
execution
[10]
Similarly,
there is no merit to the submission that the defendants An Le and Anh Ly should
not be personally liable for the claims contained in the Statement of Claim and
ultimately the default judgment. It is admitted that they have been at
all times the principals behind the businesses undertaking the activities that
are of concern. Further, they have been fully advised as to the legal
proceedings brought on behalf of the plaintiff involving their
activities. These activities continued to occur for years after they were
first put on notice and indeed after default judgment had been obtained against
the corporate entity (which was described in error as a result of communication
with their counsel) and them personally. The Court sees no merit in
granting any equitable relief to the defendants under such circumstance.
ORDER
THIS
COURT ORDERS that the motions are dismissed, with costs
fixed in the amount of $2,000.
"D.G.
Near"
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