Soucy International Inc. v. Camoplast Inc., 2003 FCA 211

Date: 20030506

Docket: A-428-01

Montréal, Quebec, May 6, 2003

CORAM:       DESJARDINS J.A.

NOËL J.A.

NADON J.A.

BETWEEN:

CAMOPLAST INC.

Appellant

and

SOUCY INTERNATIONAL INC.

Respondent

JUDGMENT

This appeal is dismissed without costs as it has now become moot.

Certified true translation

Suzanne M. Gauthier, C. Tr., LL.L.

Date: 20030506

Docket: A-184-01

Montréal, Quebec, May 6, 2003

CORAM:       DESJARDINS J.A.

NOËL J.A.

NADON J.A.

BETWEEN:

SOUCY INTERNATIONAL INC.

Appellant

and

CAMOPLAST INC.

Respondent

JUDGMENT

The appeal is allowed with costs in this Court and at trial, and the judgment by the Trial Division judge is quashed. The appeal to the trial judge from the prothonotary's decision is allowed and the prothonotary's decision is quashed. The appellant Soucy is authorized to amend its defence and counterclaim to add the following paragraphs thereto:

           16.1     the patent at issue, namely Canadian patent No. 2,182,845, is the subject of a patent application and the issuance of a similar U.S. patent, which was issued under No. USP 5,730,510; in the U.S. patent, claim No. 1 of the Canadian patent is not reproduced and this factor adds to the arguments for invalidity of the patent at issue, as described in paras. 14, 15 and 16 above;

17.       viii.       three-step Aktiv track series No. 4375, the three successive steps of which differ in configuration from each other, which was manufactured and sold before the date the patent was filed;

ix.         Soucy-Quimpex track, which includes a three-step repeated at two places along the length of the track, which was manufactured and sold before the date the patent was filed;

x.         Yokohama track for Arctic Cat, Exhibit No. 602-001, which includes a variable step configuration repeated elsewhere on the track, which was produced and tested in December 1991 and January 1992;

18.1     Mr. Courtemanche was instructed by Mr. Lecours to do the preparatory work leading to Canadian patent application No. 2,143,802 (Lecours), and accordingly Mr. Courtemanche and his team were fully aware of Mr. Lecours' work on reducing the noise that may be created by snowmobile tracks, before the date the patent at issue was filed;

18.2     the plaintiff manufactured tracks for the Arctic Cat company between 1979 and 1991, the tracks being used on Aktiv brand snowmobiles, and therefore knows that Aktiv snowmobiles have no longer been made since 1991-92.

Certified true translation

Suzanne M. Gauthier, C. Tr., LL.L.

Date: 20030506

Docket: A-184-01

Citation: 2003 FCA 211

CORAM:       DESJARDINS J.A.

NOËL J.A.

NADON J.A.

BETWEEN:

SOUCY INTERNATIONAL INC.

Appellant

and

CAMOPLAST INC.

Respondent

Hearing held at Montréal, Quebec, on May 6, 2003.

Judgment from the bench at Montréal, Quebec, on May 6, 2003.

REASONS FOR JUDGMENT OF THE COURT:                                                    DESJARDINS J.A.

Date: 20030506

Docket: A-184-01

Citation: 2003 FCA 211

CORAM:       DESJARDINS J.A.

NOËL J.A.

NADON J.A.

BETWEEN:

SOUCY INTERNATIONAL INC.

Appellant

and

CAMOPLAST INC.

Respondent

REASONS FOR JUDGMENT OF THE COURT

(Delivered from the bench at Montréal, Quebec, on May 6, 2003)

DESJARDINS J.A.

[1]                 The Court has before it two appeals, the first in case A-184-01 (Camoplast Inc. v. Soucy International Inc., 2001 FCT 169, [2001] F.C.J. No. 330 (F.C.T.D.) (QL), per Blais J., rendered on March 9, 2001), and the second in case A-428-01 (T-2006-99, per Pinard J., rendered on May 28, 2001, not reported).

[2]                 These two appeals were joined for hearing.

[3]                 The Court heard the appeal in case A-184-01 and now delivers its judgment in that case.

[4]                 For the reasons we will give below, the reasons for this judgment shall be filed in case A-428-01.

1.         Background to proceedings

[5]                 In the principal action, Camoplast Inc. ("Camoplast") sued Soucy International Inc. ("Soucy") for infringement of Canadian patent No. 2,182,845. Soucy filed a defence and counterclaim, alleging the patent was invalid.

[6]                 After the usual originating proceedings, an initial series of examinations for discovery of the inventor Denis Courtemanche was held in May and June 2000. Objections were filed by Camoplast at that time. They were allowed by the prothonotary on the ground that the questions covered were not relevant or concerned the validity of another patent, not at issue ([2000] F.C.J. No. 1825 (F.C.T.D.) (QL)).

[7]                 On December 15, 2000, Soucy filed with the prothonotary an initial motion for leave to amend its defence and counterclaim pursuant to Rule 75 of the Federal Court Rules (1998), so as to include certain new facts which Soucy said had been brought to its attention at the examination for discovery of the inventor Denis Courtemanche.

[8]                 The prothonotary disallowed the amendment. Soucy appealed that decision and submitted two new affidavits to the trial judge in support of its application for an amendment. Blais J. said he lacked jurisdiction to admit this new evidence. He said he was authorized to review the prothonotary's decision only on the basis of the record as it stood before the prothonotary. He subsequently affirmed the prothonotary's decision, but invited Soucy to make a new motion for amendment to the prothonotary, supported this time by the two new affidavits.

[9]                 Soucy appealed the judgment of Blais J. (case A-184-01), but at the same time filed a second motion for an amendment with the prothonotary, and this was allowed. That judgment was appealed by Camoplast. However, it was upheld by Pinard J., who affirmed the prothonotary's second decision allowing the amendment. Camoplast appealed the judgment of Pinard J. (case A-428-01).

[10]            In an order dated May 9, 2002, this Court ordered that the two appeals be heard successively by a single bench, the appeal in case A-184-01 to be heard first (2002 FCA 189, [2002] F.C.J. No. 724 (F.C.A.) (QL)).

2.         Appeal in case A-184-01

[11]            In its first motion for an amendment on December 15, 2000, Soucy asked for the addition of the following paragraphs to its defence and counterclaim:

[TRANSLATION]

                                 16.1         The patent at issue, namely Canadian patent No. 2,182,845, is the subject of a patent application and the issuance of a similar U.S. patent, which was issued under No. USP 5,730,510; in the U.S. patent, claim No. 1 of the Canadian patent is not reproduced and this factor adds to the arguments for invalidity of the patent at issue, as described in paras. 14, 15 and 16 above;

. . .

17.           viii.          three-step Aktiv track series No. 4375, the three successive steps of which differ in configuration from each other, which was manufactured and sold before the date the patent was filed;

                ix.            Soucy-Quimpex track, which includes a three-step repeated at two places along the length of the track, which was manufactured and sold before the date the patent was filed;

                x.             Yokohama track for Arctic Cat, Exhibit No. 602-001, which includes a variable step configuration repeated elsewhere on the track, which was produced and tested in December 1991 and January 1992;

. . .

18.1         Mr. Courtemanche was instructed by Mr. Lecours to do the preparatory work leading to Canadian patent application No. 2,143,802 (Lecours), and accordingly Mr. Courtemanche and his team were fully aware of Mr. Lecours' work on reducing the noise that may be created by snowmobiles, before the date the patent at issue was filed;

18.2         the plaintiff manufactured tracks for the Arctic Cat company between 1979 and 1991, the tracks being used on Aktiv brand snowmobiles, and therefore knows that Aktiv snowmobiles have no longer been made since 1991-92.

[12]            On January 24, 2001, the prothonotary dismissed this motion based on para. 12 of the written submissions by Camoplast, which reads as follows:

[TRANSLATION]

12.           Since the parties have already conducted two examinations in the case at bar, and the amendments proposed by the applicant concern facts of which it had knowledge well before those examinations took place, and further it had questioned Denis Courtemanche on these facts, questions to which objections were made and which were allowed by this Honourable Court, it is in the interests of justice for the amendments proposed by the applicant to be dismissed . . .

[13]            Camoplast asked this Court to affirm this decision, because the statements in support of Soucy's application are wrong, as according to Camoplast Soucy had knowledge of all the facts described as [TRANSLATION] "new" well before its motion to amend was filed.

[14]            The rules that guide this Court in questions of amendments are the following.

[15]            In Enoch Band of Stony Plain Indians v. Canada, [1993] F.C.J. No. 1254 (F.C.A.) (QL), para. 8, Décary J.A. stated, for the Court, that "the Court will only . . . deny amendments in plain and obvious cases where the case is beyond doubt". (For a case applying this decision, see Hoechst Aktiengesellschaft v. ADIR (1999), 82 C.P.R. (3d) 344, rendered on July 14, 1998, [1998] F.C.J. No. 1028 (F.C.T.D.) (QL), per Reed J.).

[16]            In Canderel v. Canada, [1994] 1 F.C. 3 (C.A.), at 10, Décary J.A., for the Court, reviewed as follows the tests which should be applied in questions of amendments:

. . . while it is impossible to enumerate all the factors that a judge must take into consideration in determining whether it is just, in a given case, to authorize an amendment, the general rule is that an amendment should be allowed at any stage of an action for the purpose of determining the real questions in controversy between the parties, provided, notably, that the allowance would not result in an injustice to the other party not capable of being compensated by an award of costs and that it would serve the interests of justice.

[17]            In Visx v. Nidex, [1998] F.C.J. No. 1766 (F.C.A.) (QL), Sexton J.A., for this Court, said he was bound by Meyer v. Canada, 62 N.R. 70, [1985] F.C.J. No. 929 (F.C.A.) (QL), per Mahoney J.A., which cited and approved the following passage from Stewart v. North Metropolitan Tramways Co. (1886), 16 Q.B.D. 556, regarding the tests to be applied in amendment matters:

The rule of conduct of the Court in such a case is that, however negligent or careless may have been the first omission, and however late the proposed amendment, the amendment should be allowed, if it can be made without injustice to the other side. There is no injustice if the other side can be compensated by costs: but, if the amendment will put them into such a position that they must be injured, it ought not to be made.

[18]            It was not in dispute that Camoplast would suffer no harm in the case at bar if the amendment was allowed.

[19]            Whatever the time at which Soucy learned of the facts which it now wishes to add, according to the tests in Visx, supra, this situation was not a reason for denying Soucy leave to amend its pleadings.

[20]            As the subject of the amendment was to allow clarification of the real points at issue, the prothonotary could not disallow the motion for an amendment filed by Soucy for the reasons given by Camoplast.

[21]            In this Court Camoplast argued that in any case the evidence submitted in support of the motion was prima facie insufficient for the amendment to be allowed. As it is clear from the written submissions of Camoplast that this argument was not made either to the prothonotary or the trial judge, it cannot be considered on appeal.

[22]            The prothonotary accordingly misdirected himself in law.

[23]            The trial judge should have intervened, in accordance with the rules laid down in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.), at 462-463. MacGuigan J.A. said the following, for the majority:

                I also agree with the Chief Justice in part as to the standard of review to be applied by a motions judge to a discretionary decision of a prothonotary. Following in particular Lord Wright in Evans v. Bartlam, [1937] A.C. 473 (H.L.) at page 484, and Lacourcière J.A. in Stoicevski v. Casement (1983), 43 O.R. (2d) 436 (Div. Ct.), discretionary orders of prothonotaries ought not to be disturbed on appeal to a judge unless:

(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) they raise questions vital to the final issue of the case.

Where such discretionary orders are clearly wrong in that the prothonotary has fallen into error of law (a concept in which I include a discretion based upon a wrong principle or upon a misapprehension of the facts), or where they raise questions vital to the final issue of the case, a judge ought to exercise his own discretion de novo.

[24]            In conclusion Soucy asked that costs be awarded to it on a solicitor-client basis. We do not feel that this application is warranted.

[25]            The appeal will accordingly be allowed with costs in this Court and at trial and the judgment of the Trial Division judge will be quashed. The appeal to the trial judge from the prothonotary's decision will be allowed and the prothonotary's decision quashed. The appellant Soucy will be authorized to amend its defence and counterclaim to add the paragraphs sought.

3.         Appeal in case A-428-01

[26]            The appeal in case A-428-01 is now moot. It will be dismissed without costs for that reason.

Certified true translation

Suzanne M. Gauthier, C. Tr., LL.L.

                          FEDERAL COURT OF CANADA

                                       APPEAL DIVISION

                                SOLICITORS OF RECORD

Appeal from judgment rendered in Trial Division on March 9, 2001, in case T-2006-99.

FILE:                                                                               A-184-01

STYLE OF CAUSE:                                                     SOUCY INTERNATIONAL INC.

Appellant

and

CAMOPLAST INC.

Respondent

PLACE OF HEARING:                                                Montréal, Quebec

DATE OF HEARING:                                                  May 6, 2003

REASONS FOR JUDGMENT OF THE COURT (DESJARDINS, NOËL AND NADON JJ.A.)

DELIVERED FROM THE BENCH BY:                 DESJARDINS J.A.

DATE OF REASONS:                                                  May 6, 2003

APPEARANCES:

Eric Ouimet                                                                        FOR THE APPELLANT

Jean Carrière                                                                      FOR THE RESPONDENT

SOLICITORS OF RECORD:

Brouillette, Charpentier, Fortin                                        FOR THE APPELLANT

Montréal, Quebec

Mendelsohn                                                                        FOR THE RESPONDENT

Montréal, Quebec