1395047 Ontario Inc. v. Farol Sports Bar Inc., 2003 FC 1188

Date: 20031010

Docket: T-1834-02

Citation: 2003 FC 1188

Ottawa, Ontario, this 10^th day of October 2003

Present:           The Honourable Madam Justice Heneghan                                      

BETWEEN:

                                                             1395047 ONTARIO INC.

                                  cob FPTV - FESTIVAL PORTUGUESE TELEVISION

                                                                                                                                                   PLAINTIFF

                                                                              - and -

                                                         FAROL SPORTS BAR INC.;

                                       BLUE NIGHTS SPORTS BAR; CAFÉ DELIZIA;

                                       WALTER'S SPORTS BAR; POR DO SOL INC.;

                                           DOCE MINHO PASTRY & BAKERY LTD.;

                                                       STAR NIGHTS; URUHU BAR;

      COSTA VERDE BAR & RESTAURANT/CHURRASQUEIRA COSTA VERDE INC.;

                                                           CASCAIS BAKERY LTD.;

                                       LA BAMBA RESTAURANT & NIGHT CLUB;

                      WHITE ELEPHANT SPORTS BAR INC.; CAFÉ DO PORTO INC.

                                               PORTUGUESE CANADIAN BAKERY;

                                                           DELTA SPORTS BAR; and

                                                          TRINI PORT SPORTS BAR

                                                                                                                                                  (ONTARIO)

                                                                              - and -

ASSOCIATION PORTUGAISE RECREATIVE ET CULTURELLE DE VILLE LA SALLE

                                                                                                                                                    (QUEBEC)

                                                                              - and -

                                                                     CAFÉ PARDAL;

                    CHARCUTERA MICAELENSE AND GROCERIES (1987) LTD.; and

                                                        CAFÉ 2001 (CARLOS TELES)

                                                                                                                                                  (ALBERTA)

                                                                              - and -

                              METRO COFFEE & BILLIARDS; SERRA COFFEE BAR;

                                                GRANDVIEW BILLIARDS INC.; and

                                       PORTUGAL BISTRO OFF BROADWAY LTD.

                                                                                                                           (BRITISH COLUMBIA)

                                                                                                                                           DEFENDANTS

                                               REASONS FOR ORDER AND ORDER

INTRODUCTION

[1]                 1395047 Ontario Inc. (the "Plaintiff") seeks an order pursuant to the Federal Court Rules, 1998 that four Defendants, that is Por Do Sol Inc., Blue Nights Sports Bar, Edmund Santo c.o.b. as Café Delizia and Tseggaz Sebhatu c.o.b. as Uruhu Bar are in breach of the injunctions issued by this Court on November 26, 2002, thereby committing an act of contempt.

[2]                 The injunctions were issued in the context of the action commenced by the Plaintiff on October 30, 2002. In its statement of claim, the Plaintiff alleges that it is the exclusive distributor for the rights to commercial satellite broadcasts in Canada for all Portuguese League matches for the 2002/2003 season. This motion was originally scheduled to be heard on January 27, 2003 but further to an order made on February 24, 2003, the hearing was adjourned until March 24, 2003. By order made on March 10, 2003, Mr. Aries was accorded status to represent the Defendant Por Do Sol Inc. At the hearing on March 24, 2003, Mr. Aries appeared on behalf of this Defendant. A Mr. Wondem attended in connection with Uruhu Bar but neither sought nor was accorded status to represent the Defendant. No one appeared for or on behalf of the Defendants Café Delizia or Blue Nights Sports Bar.

THE EVIDENCE

[3]                 The Plaintiff called two witnesses. The first was Ms. Jenny Naumovski, a legal assistant with the law firm representing the Plaintiff. She testified concerning service of various orders upon the Defendants, including the two orders of November 26, 2002. The first order granted an injunction against Blue Nights Sports Bar, Café Delizia and Uruhu Bar. The second granted an injunction against Por Do Sol Inc. According to Ms. Naumovski, copies of these orders were sent to the Defendants by registered mail, regular mail, and by courier, using Maple Express Courier Service, together with a letter dated November 27. Ms. Naumovski identified courier receipts on behalf of the Defendants.

[4]                 The letter of November 27, together with the courier receipts were entered at Tab 3 of Exhibit P-1, an exhibit book prepared on behalf of the Plaintiff. Ms. Naumovski testified that she did not receive any correspondence back from either the courier service or the mail service, although the receipt from the courier service showed that the package for Blue Nights was deposited in the mail box and there was no delivery receipt signed for the courier service on behalf of the Defendant. She said that she did not know if the package for Blue Nights had "been accepted or not, by them".

[5]                 Ms. Naumovski also testified that similar letters were sent to Por Do Sol and the correspondence in that regard was found at Tabs 3 and 4 of the Exhibit Book. However, Mr. Aries, as the designated representative for that Defendant, acknowledged receipt of that correspondence and that service is not an issue.

[6]                 Ms. Naumovski also identified affidavits found at Tab 11 of the Plaintiff's Book of Exhibits. These affidavits are from a process server and relate to service of a motion record upon the four Defendants on January 21, 2003. According to Ms. Naumovski, the Defendants were served on January 21, 2003, with a copy of the motion record returnable on January 27.

[7]                 Ms. Naumovski testified that by letter dated March 3, 2003, copies of the orders dated January 27, January 30 and February 24, 2003, were served upon the four Defendants by courier, registered mail and regular mail. Receipts for the registered mail delivery are included at Tab 16.    As well, there are affidavits of service dated March 20, 2003, attesting to personal service of the order of February 24, 2003 upon these four Defendants on March 19, 2003.

[8]                 The second witness called on behalf of the Plaintiff was Mr. Bonaventure Falcone. He is employed with the Plaintiff as a credit manager. He testified that on three occasions, that is December 8, 2002, January 5, 2003 and March 21, 2003, he was instructed to attend on certain establishments, including those of the four Defendants, to determine if they were broadcasting sports games to which the Plaintiff holds exclusive rights, contrary to the injunctions issued on November 26, 2002.

[9]                 He testified that on December 8, 2002, he went to the premises of Por Do Sol and saw that a game was being broadcast. He identified the broadcast by the presence of a logo in the corner of the TV screen. He was in the premises for approximately 15 minutes. He sat at the bar and ordered a mineral water. Upon return to his vehicle, he made a note about the number of people he saw in the bar. He later transcribed his note to a memorandum which was identified at Tab 6, Plaintiff's Exhibit Book. This memorandum records that he attended at the premises of Por Do Sol at 4:15 p.m. on December 8, 2002 and counted 18 people viewing the game.

[10]            He re-attended at Por Do Sol on January 5, 2003 at 3:39 p.m. and counted 40 people. Again, he made his notes upon return to his car. The note was transcribed onto a memorandum which was included as Tab 9, Plaintiff's Exhibit Book.

[11]            On January 5, 2003, Mr. Falcone also attended at Blue Nights Sports Bar and Uruhu Bar. He went to the Blue Nights Sports Bar at 2:40 p.m. and counted 18 people viewing the game. He attended at the Uruhu Bar at 3:20 p.m. and counted 15 people viewing the game. His memorandum concerning this visit was identified at Tab 9, Plaintiff's Exhibit Book. On January 5, 2003, Mr. Falcone visited 12 establishments between 2:15 p.m. and 3:51 p.m. He also visited the Café Delizia and Bakery at 3:41 p.m. and observed 13 people viewing the game.

[12]            On March 21, 2003, Mr. Falcone returned to the Uruhu Bar and Blue Nights Bar. He made those visits at 4:15 p.m. and 4:44 p.m. At the Uruhu Bar, he counted 12 people viewing the game. At the Blue Nights Sports Bar, he counted 5 people viewing the game. His memorandum concerning this investigation was entered as Exhibit P-2. In all cases, Mr. Falcone said he identified the broadcast by the presence of the "SPT" logo on the television screen. Mr. Falcone did not describe the logo in any way but said that he had been instructed to look for it on the television screen.

[13]            Mr. Falcone was cross-examined by Mr. Aires, representative of the Defendant Por Do Sol. He was questioned about the records of his visit to the premise of these four Defendants and queried, in particular, about the correctness of his memoranda. Mr. Falcone was asked if he was sure about the times that he had recorded for his visits to the premises of these Defendants. He was questioned as to how he could have visited so many establishments within a relatively short period of time. Mr. Falcone testified that he had been driven from place to place and that the driver would drop him off in front of the premises, he would enter and make his survey, then return to the car where he made his notes about what he had seen and the number of people present. When pressed by Mr. Aires, Mr. Falcone maintained that he was certain about the times that he had written down. He gave no evidence as to the proximity of these establishments to each other.

[14]            The sole witness called on behalf of Por Do Sol was Ms. Anabel Silva. She is the sister of the proprietor of Por Do Sol and works there as an assistant cook. She has been acquainted with that establishment for ten years. She testified that on December 8, 2002, the restaurant was closed at the time when Mr. Falcone purportedly visited it. The establishment was closed because the family, that is the owners, were at a Chinese restaurant celebrating the birthday of her brother, Mr. Mendes, the proprietor of Por Do Sol. She said it was impossible for Mr. Falcone to have attended at the time indicated in his memorandum. When asked in cross-examination for documentary proof that the restaurant was closed for business on the afternoon of December 8, 2002, Ms. Silva said that if the bar had been open, the game would not have been broadcast because her brother did not have permission from the Court to do so.

[15]            Furthermore, she testified that the game in question, allegedly shown on December 8, 2002, was over by the time Mr. Falcone attended. She produced and identified a document called the "A Bola" a schedule for the game in question. Ms. Silva said that her husband had obtained this from the internet and that this schedule clearly showed that the game began in Portugal at 6 p.m. which was 1:00 p.m. in Toronto. She maintained that the game would have been over at 4:15, the time Mr. Falcone said that he went to the premises of Por Do Sol.

[16]            As well, Ms. Silva testified that the restaurant had shown the Portuguese soccer games in the past but currently, "we show only the games that we, we can". She testified that her brother paid for transmissions of certain sports channels, including RTPE, TV Globo and TV Record. The premises has satellite receiving equipment. She does not know very much about the receipt of the game and said that her brother pays for the Portuguese channel.

ISSUES

[17]            There are two issues arising from this motion. Were the Defendants properly served with the orders of November 26, 2002, January 27, 2003, January 30, 2003 and February 24, 2003? The second issue is whether the Plaintiff has discharged the burden of showing that these Defendants are in contempt of orders of this Court.

ANALYSIS

[18]            On the basis of the evidence of Ms. Naumovski, I am satisfied that the Defendants Por Do Sol, Uruhu Bar and Café Delizia received these orders, in November 2002 and March 2003. I refer to the evidence of Ms. Naumovski that she prepared a letter on November 27,2002 to accompany copies of the order dated November 26, 2002. This letter is found at Tab 3 of Exhibit P-1. As well, there are receipts from Maple Express Courier Service dated November 27, 2002 which show that envelopes were delivered to and signed for by Café Delizia and Uruhu Bar. Mr. Aires, on behalf of Por Do Sol, acknowledged receipt of the correspondence of November 27, 2002 and December 3, 2002. The courier slip concerning the delivery to Blue Nights Sports Bar simply says it was delivered in the mailbox.

[19]            The affidavit of service sworn by Ms. Naumvoski on March 5, 2003, which appears at Tab 17 of the Plaintiff's Exhibit Book, provides as follows in paragraph 2:

I served all of the Defendants listed at Schedule "A" to this Affidavit of Service with the Orders of Mr. Justice Campbell dated January 27^th, 2003 and January 30^th, 2003 and the Order of Madam Justice Snider dated February 24, 2003 (copies of these Orders appended to this Affidavit of Service) by sending copies of same by Maple Express courier (copies of waybills appended to this Affidavit of Service), regular lettermail and registered mail (copies of Registered Mail receipts appended to this Affidavit of Service) on March 5, 2003.

[20]            Her affidavit refers to copies of waybills for Maple Express Courier Service addressed to these four Defendants. These waybills are undated and do not show that the envelopes in question were received by any of the addressees. However, the affidavit also contains copies of receipts from Canada Post, showing delivery of registered mail. It is clear that the correspondence from the solicitors for the Plaintiff was delivered to the Defendants Café Delizia, Uruhu Bar and Por Do Sol. These receipts are found at Tab 16 of the Plaintiff's Exhibit Book. The receipt, however, concerning delivery to Blue Nights says that the customer was not available and a card was left to advise it to pick up the item at the local Canada Post outlet. Ms. Naumovski testified that she received nothing back from the Post Office or from the courier service.

[21]            There are affidavits of service from a process server, concerning personal service of the order dated February 24, 2003, upon the four Defendants. These affidavits appear at Tab 18 of the Plaintiff's Book of Exhibits. I am satisfied that Blue Nights Sports Bar was served with this order. However, I am not satisfied that it was properly served with the injunction dated November 26, 2002. In the absence of reliable evidence that this Defendant was indeed served with the injunction, I see no basis for proceeding with the motion for contempt against this Defendant. It cannot be in contempt of an order which has not been properly served upon it. Ms. Naumovski did not know if Blue Nights Sports Bar received the package sent by courier on November 27. The fact that she received nothing back from the courier company does not mean that service had been effected.

[22]            Accordingly, I dismiss this motion against the Defendant Blue Nights Sports Bar.

[23]            I turn now to the second issue arising from this motion. Has the Plaintiff discharged its burden of showing that the remaining Defendants have committed an act of contempt?

[24]            Two separate orders were issued on November 26, 2003. In one, an interlocutory injunction was issued against Blue Nights Sports Bar, Café Delizia and Uruhu Bar. In the second, an interlocutory injunction was issued against the Defendant Por Do Sol. The operative parts of the orders are the same and read as follows:

1.              ... restraining each of them, their agents or servants, or any person acting under their instructions, or any person having knowledge thereof, from publicly showing, exhibiting or performing any Portuguese Football National Football League/Portuguese Premiere League soccer (Portuguese League) matches or decoding, without authorization, transmissions of same, without the consent in writing of the Plaintiff, except those Portuguese league matches that are shown on the RTP International Network.

2.              An order that each of the Named Defendants provide the Plaintiff with any serial numbers, identification numbers and satellite transmission decoding card numbers requested by the Plaintiff appearing on the Defendants' satellite receiving equipment, including any satellite dishes or satellite receiving sets.

3.              The issuance of this order is premised on the Plaintiff's undertaking to abide by any order concerning damages that the Court may make if it ultimately appears that the granting of the order has caused damage to any of the responding parties for which the Plaintiff ought to compensate any of the responding parties.

[25]            The evidence adduced by the Plaintiff in support of its allegation of contempt is that of Mr. Falcone. As noted above, Mr. Falcone testified that he went to the premises of Por Do Sol on two occasions, that is December 8, 2002 and January 5, 2003. He testified that he went to the premises of Blue Nights Sports Bar, Uruhu Bar and Café Delizia on January 5. On March 21, 2003, he returned to the premises of Uruhu Bar and Blue Nights Sports Bar. In light of my conclusion concerning lack of evidence of service of the injunction upon Blue Nights Sports Bar, I will deal only with the evidence of Mr. Falcone as it relates to Por Do Sol, Uruhu Bar and Café Delizia.

[26]            Mr. Falcone testified that he was taken by car to the various establishments, was dropped off, entered, made his observations, returned to the car and made notes, and later prepared the memoranda which were entered into evidence. He was challenged by Mr. Aires concerning the accuracy of his times and his ability to visit so many places, which were not next door to each other, in a relatively short time period. Although Mr. Falcone maintains that he was able to do this, because he was being transported from place to place, he did not give any evidence about the relative locations of these establishments or attempt to explain how he could have visited so many places in the short times recorded. He did not produce his original notes.

[27]            Although the witness who testified on behalf of Por Do Sol gave evidence that Mr. Falcone could not have visited that place on December 8, 2002, because the premises were closed, this situation was not put to Mr. Falcone in his cross-examination. Accordingly, I give that evidence little weight in determining whether the Plaintiff has discharged its burden.

[28]            This motion has been taken pursuant to Rules 466 and 467 of the Federal Court Rules. 467(1) provides as follows:

[29]            Rule 469 addresses the applicable burden of proof and provides as follows:

[30]            Rule 470 addresses the nature of the evidence to be presented and provides as follows:

[31]          The burden of proof in contempt proceedings is similar to that prevailing in criminal proceedings, that is proof beyond a reasonable doubt that the alleged contemners committed the acts complained of. In this regard see Bhatnager v. Canada (Minister of Employment and Immigration), [1990] 2 S.C.R. 217 and Vidéotion Ltée v. Industries Microléc Produits Électronique Inc., [1992] 2 S.C.R. 1065.

[32]            The burden lies on the Plaintiff to prove that the Defendants acted in contempt of an order of the court. The elements of contempt were identified in Lyons Partnership, L.P. v. McGregor (2000), 5 C.P.R. (4^th) 157 at page 160 as follows:

...Those constituent elements, the onus of proof which is upon the plaintiff, are: a defendant's actual personal knowledge of the Court's order; the defendant is the primary actor either actually or by express or implied authorization; and the required degree of mens rea.

[33]            Applying this test to the facts here, I am satisfied that the Plaintiff has proven personal service of the injunction upon Por Do Sol, Uruhu Bar and Café Delizia. However, I am not persuaded, on the evidence adduced by the Plaintiff, that the Plaintiff has established that any of the Defendants, that is Por Do Sol, Uruhu Bar and Café Delizia were engaged in activities prohibited by the injunction dated November 26, 2002. I conclude that in his cross-examination of Mr. Falcone, Mr. Aires has raised a reasonable doubt as to whether Mr. Falcone could have carried out his surveys on the dates in question, at the times indicated. Furthermore, there was no evidence concerning the alleged breach by these Defendants of any other provisions of the orders made on November 26, 2002.

[34]            The Plaintiff was in the position to lead evidence concerning failure by these Defendants to comply with paragraph 2 of those orders. It did not do so. Mr. Falcone described himself as a credit manager with the Plaintiff. It is reasonable to expect that either he would know whether these Defendants had complied with paragraph 2 of the November 26 orders, or at the very least, be in a position to inform himself prior to giving his evidence.

[35]            The burden of proof in contempt proceedings requires the Plaintiff to prove its case beyond a reasonable doubt. In this case, on the basis of the evidence submitted, I am not satisfied that the Plaintiff has discharged its burden.

[36]            The motion is dismissed.

                                                  ORDER

The motion is dismissed.

                                                                                           "E. Heneghan"

                                                                                                           J.F.C.

                                       FEDERAL COURT

    NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                                 T-1834-02

STYLE OF CAUSE: 1395047 ONTARIO INC. cob FPTV-FESTIVAL

                                      PORTUGUESE TELEVISION

-and-

FAROL SPORTS BAR INC. ET AL.

PLACE OF HEARING:         TORONTO

DATE OF HEARING:           Monday, the 24^th day of March, 2003

REASONS FOR ORDER

AND ORDER:                         Heneghan J.

DATED:                                   October 10, 2003

APPEARANCES:

                                                   Kevin Fisher      FOR PLAINTIFF

Antonio Aires    FOR DEFENDANT

SOLICITORS OF RECORD:

FOR PLAINTIFF/APPLICANT

Kevin Fisher

Bosman Smith LLP

Barristers & Solicitors

1400-111-Richmond Street West

Toronto, Ontario

M5H 2G4

FOR DEFENDANT/ RESPONDENT

Antonio Aires

Rep. For Por Do Sol Inc.

1355 St. Clair Ave. West

Toronto, Ontario

M6E 1L5