Date: 20070309
Docket: A-500-06
Citation: 2007 FCA 105
Present: SHARLOW
J.A.
BETWEEN:
NOVOPHARM LIMITED
Appellant
and
JANSSEN-ORTHO INC.
and DAIICHI PHARMACEUTICAL CO., LTD.
Respondents
REASONS FOR ORDER
SHARLOW J.A.
[1]
Before me
is a motion for costs on an order I made on December 13, 2006, dismissing a
motion by the appellant Novopharm Limited for a stay of the judgment of the
Federal Court pending the disposition of this appeal (2006 FCA 406). The respondents
Janssen-Ortho Inc. and Daiichi Pharmaceutical Co., Ltd. (collectively,
“Janssen”) filed a joint motion record opposing the stay motion, and requested
costs.
[2]
My notes
of the hearing indicate that neither party made oral submissions on costs. I
did not mention costs in the order dismissing the stay or in my reasons.
[3]
On January
30, 2007, Janssen filed a notice of motion seeking an order under Rule 400 of
the Federal Courts Rules for an order granting the respondents costs in
the stay motion in the amount of $45,000, or in the alternative, costs in an
amount to be assessed by an assessment officer in accordance with certain
directions.
Procedural issues
[4]
Novopharm
opposes the motion on the basis that costs cannot be awarded on a Rule 400
motion after judgment if the judgment itself is silent on costs: Pelletier
v. Attorney General of Canada, 2006 FCA 418. In that case, unlike this one,
costs had not been requested in the proceeding, so that the later motion for
costs not consistent with the order sought in the proceeding. I do not read Pelletier
as precluding Janssen from seeking costs on the stay motion, because it asked
for costs in that proceeding.
[5]
Pelletier also points out, in obiter
dicta, that if costs are requested in a proceeding and the judgment is
silent on costs, the appropriate remedy is a motion under Rule 397 for reconsideration
of the judgment. In this case, Janssen did not refer to Rule 397 in its notice
of motion, and it is now out of time for moving under that Rule. However, Janssen
has invoked Rule 397 in its reply to Novopharm, along with a request for an
extension of time for filing a motion under Rule 397.
[6]
In this
case, I inadvertently overlooked the matter of costs. If Janssen had moved for
reconsideration under Rule 397 on a timely basis, I would have granted the
motion for reconsideration and I would have entertained the motion for a lump
sum award of costs or for directions. Having reviewed the material now before
me, I consider it unlikely that Janssen would be unable to establish the
grounds for an extension of time for a motion under Rule 397.
[7]
I note
also that part of Janssen’s motion falls squarely within Rule 403 (motion after
judgment for directions on costs), and the motion was made within the time
permitted by Rule 403(1)(a) (after taking into account the rule regarding days
during the Christmas vacation). Rule 403(2) permits such a motion whether or
not the judgment included an order concerning costs. Therefore, there is no
procedural basis upon which Janssen’s motion for directions can be dismissed.
[8]
I could dismiss
the portion of the motion that seeks an award of lump sum costs, but if I did
so it would be without prejudice to the right of Janssen to file a new notice
of motion under Rule 397 for reconsideration, for an extension of time to bring
that motion, and for the other relief sought in the current motion. However, that
would not result in a just or efficient determination of the issue of costs
(see Rule 3).
[9]
In my
view, this is an appropriate case to exercise my discretion under Rule 55, and treat
the current motion for an award of lump sum costs as though Janssen had
properly invoked Rule 397 from the outset. I do not read Novartis
Pharmaceuticals Canada Inc. v. Rhoxalpharma Inc., 2005 FCA 188, as a
decision that precludes the exercise of my discretion under Rule 55.
Whether success was divided
[10]
Janssen
argues that it is entitled to costs on the stay motion because it successfully
opposed the motion. Novopharm argues that there was divided success because,
although Janssen was successful in opposing the stay, Novopharm was successful
in obtaining from Janssen an undertaking for damages as a condition of the
dismissal of the stay motion.
[11]
The
undertaking is to abide by any order that the Court may make concerning damages
if the appeal is allowed and it appears that that the judgment under appeal has
caused damage to the Novopharm, during the period from December 13, 2006 to the
day that is 120 days after the appeal is allowed, for which Novopharm ought to
be compensated.
[12]
The value
of that undertaking cannot be determined at this stage because the appeal is
still pending. However, it can be said that the undertaking gives Novopharm a
right against Janssen that it would not have had, but for its motion for a stay.
It can also be said that the motion for a stay might well have succeeded
without that undertaking.
[13]
In these
circumstances I agree with Novopharm that success on the stay motion was
divided. The parties should bear their own costs of the stay motion.
[14]
Novopharm
is entitled to its costs of this motion, which I will fix in the amount of
$1,500 inclusive of disbursements and GST.
“K.
Sharlow”
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