Date: 20051004
Docket: T-1832-04
Citation: 2005 FC 1419
BETWEEN:
RHODIA UK LIMITED
and RHODIA INC.
Plaintiffs
(Defendants by Counterclaim)
- and -
JARVIS IMPORTS (2000) LTD.
and 116038 B.C. LTD.
Defendants
(Plaintiffs by Counterclaim)
REASONS FOR ORDER
HARRINGTON J.
[1] This is a motion by the second Defendant, 116038 B.C. Ltd., for dismissal of the Plaintiffs' action by way of summary judgment. It comes about this way.
[2] The Plaintiffs, whom I shall collectively call "Rhodia", allege they own or otherwise are interested in PROBAN, a trade-mark registered in Canada. PROBAN is said to be used in fireproofing preparations for the treatment of various fabrics. They claim that the Defendants have imported, sold and advertised in Canada garments bearing the PROBAN trade-mark, or a confusingly similar variation thereof, the whole in violation of the Trade-marks Act.
[3] The Defendants, who are represented by the same counsel, deny the allegations. Moreover, they deny that the moving party on this motion, 116038 B.C. Ltd., has ever carried on any business involving PROBAN in any way.
[4] Prior to this motion for summary judgment, the case had proceeded to the discovery of documents stage. There are outstanding disputes in connection therewith.
[5] The motion is supported by an affidavit of Sarah Jarvis, upon which she was cross-examined. The evidence in response is an affidavit by a paralegal employed in the Plaintiffs' law firm to which is attached a copy of labels appearing on a sample of garment purchased from the co-Defendant Jarvis Imports (2000) Ltd. and entries in the CA registry administered by the Competition Bureau, which invite the conclusion that the CA number was only transferred from one Defendant to the other in May of this year. The CA number is an identification number for use by Canadian dealers on the label of consumer textile articles which they import, sell or otherwise distribute in Canada.
[6] Summary judgment is granted pursuant to Rule 216 of the Federal Courts Rules if the Court is satisfied there is no general issue for trial with respect to a claim or defence.
THE CORPORATE HISTORY
[7] It began in the 1970s with a corporation known as Jarvis Imports and Sales Ltd. which imported industrial work wear and camping goods. This was a family business operated by Maurice Jarvis and the affiant, his wife Sarah. Their children also held positions in the company. In late 2000, the assets of the company were sold to Jarvis Imports (2000) Ltd. This may have been an arms-length transaction, although Mrs. Jarvis, who is now quite elderly, understands that for a time at least she was a director of the new corporation, as was her husband. Her husband Maurice was to continue as a consultant, and a numbered company was created to facilitate the receipt of income. Jarvis Imports and Sales Ltd. changed its name to 116038 B.C. Ltd.
[8] Tragically, Maurice Jarvis suffered a stroke in 2001 and has been incapacitated - so much so that he never provided consulting services to Jarvis Imports (2000) Ltd. and is apparently unable to offer any evidence to this Court.
[9] Sarah Jarvis states categorically that "my company", 116038 B.C. Ltd., never had anything to do with the importation and sale in Canada of garments bearing references to PROBAN. Yet, the cross-examination suggests that her memory may be far from flawless. On the one hand, she said she had never heard of the word PROBAN before the action was instituted, which was in October 2004. On the other hand, she signed various papers for her husband Maurice Jarvis, who only ceased to be a director of Jarvis Imports (2000) Ltd. in November 2004. On the one hand, she assumes that the CA number was transferred at the time of sale in 2000 because "why would we need that number anymore?" On the other hand, the number was only assigned to, or at least the assignment was only registered, Jarvis Imports (2000) Ltd. after the lawsuit commenced.
[10] At this stage, I am not satisfied that there is no genuine issue for trial with respect to the claim and so must dismiss the motion for summary judgment.
[11] The motion practically assumes that Sarah Jarvis is the alter-ego of the moving corporation. The evidence to date is somewhat doubtful. The asset purchase agreement does not mention the CA number. Even if Mrs. Jarvis could be considered the directing mind of the corporation, the fact that she has no knowledge of the circumstances in which, according to her, the co-Defendant Jarvis Imports (2000) Ltd. was using 116038 B.C. Ltd.'s CA number does not constitute a full defence to the claim. Not only is a corporation distinct in law from its officers, directors and shareholders (Salomon v. Salomon & Co., [1897] A.C. 22), a corporation may be liable absent any actual fault or privity on the part of its directing mind or alter-ego (Lennard's Carrying Company Limited v. Asiatic Petroleum Company Limited, [1915] A.C. 705; Disney Enterprises Inc. v. 2631-5374 Quebec Inc. (c.o.b. Multividéo), 2004 FC 1360).
[12] The test on a motion for a summary judgment is not whether a party cannot possibly succeed, it is whether the case is so doubtful that it does not deserve further consideration (Granville Shipping Co. v. Pegasus Lines Ltd., [1996] 2 F.C. 853).
[13] If there are serious factual or legal issues that must be resolved, the case is not appropriate for summary judgment (Kanematsu GmbH v. Acadia Shipbrokers Ltd. (2000), 259 N.R. 201). In this case, there are still serious factual issues as to the relationship between the Defendants, their officers and directors, and the history of the assignment of the CA number. In law, the Plaintiffs take the position that the public registration of that number constitutes a representation which can be relied upon to support the action. That is an arguable point.
[14] For these reasons, the motion shall be dismissed with costs.
(Sgd.) "Sean Harrington"
Judge
Vancouver, BC
October 4, 2005
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1832-04
STYLE OF CAUSE: RHODIA UK LIMITED et al.
- and -
JARVIS IMPORTS (2000) LTD. et al.
PLACE OF HEARING: Vancouver, BC and Montreal, QC
DATE OF HEARING: By Teleconference on October 4, 2005
REASONS FOR ORDER: HARRINGTON J.
DATED: October 4, 2005
APPEARANCES:
Ms. Hélène D'Iorio FOR PLAINTIFFS (DEFENDANTS BY COUNTERCLAIM)
Mr. Paul Smith FOR DEFENDANTS (PLAINTIFFS BY COUNTERCLAIM)
SOLICITORS OF RECORD:
Gowling Lafleur Henderson LLP FOR PLAINTIFFS (DEFENDANTS
BY COUNTERCLAIM)
Montreal, QC
Paul Smith Intellectual Property Law FOR DEFENDANTS (PLAINTIFFS
Vancouver, BC BY COUNTERCLAIM
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