Date: 20011213
Docket: T-458-97
Neutral citation: 2001 FCT 1383
BETWEEN:
ROBERT MICHAUD and
ADHÉSITECH INC.
Plaintiffs/
cross-defendants
and
SOPREMA INC.
Defendant/
cross-plaintiff
REASONS FOR ORDER
RICHARD MORNEAU, PROTHONOTARY:
[1] The Court has before it a motion by the defendant and cross-plaintiff ("the defendant") pursuant to Rule 75 of the Federal Court Rules, 1998 ("the Rules") to amend its defence and counterclaim ("the defence").
[2] The defendant is also seeking the right to proceed with the examinations for discovery of the plaintiffs and cross-defendants ("the plaintiffs") on the amendments made or to be made by them again to their reply and defence to the amended counterclaim.
Background
[3] The instant motion was filed in connection with an action for infringement of Canadian patent No. 1,298,951 brought on March 18, 1997.
[4] On February 4, 1998 a counterclaim was added seeking to have the Court invalidate the patent, or alternatively, to have Messrs. Denis Faucher and Gilbert Lorenzo declared the sole inventors of the invention described and claimed in the patent and to declare their employer Soprema Inc. the sole holder of rights to the patent.
[5] On September 14, 1998 a reply and defence to the counterclaim was served on the defendant.
[6] The plaintiffs' examinations before and after defence, namely on the statement of claim and on the reply and defence to the counterclaim, were held in May and June 1997 and in January 1999.
[7] Between January and September 1999 the plaintiffs changed counsel three times due to the death of two of their counsel.
[8] On September 5, 1999 the action was dismissed for failure to respond to the status review notice, but reinstated by order of November 30, 1999 as a specially managed proceeding.
[9] By a letter dated December 3, 1999 the defendant consented to the filing of a reply and defence to the amended counterclaim, reserving the right to examine the plaintiffs on those amendments at a later date.
[10] On January 17, 2000 the plaintiffs filed the reply and defence to the amended counterclaim, to which they had added inter alia paragraphs 36 to 90.
[11] On March 6, 2000, following the reinstatement of the action on November 30, 1999, the Court imposed the following schedule on the parties:
- exchange of affidavit of documents by each party by May 8, 2000 at the latest;
- termination of examinations for discovery by June 20, 2000 at the latest; and
- filing of application for pre-trial conference by the plaintiffs by September 6, 2000 at the latest.
[12] In May 2000 the parties exchanged their list of documents. However, the defendant did not receive a copy of the plaintiffs' documents until December 2000.
[13] On August 16 and 17, 2000 the plaintiffs proceeded with the examinations for discovery of the defendant.
[14] By order of October 20, 2000, as certain deadlines specified in the March 6 order had not been complied with, the Court directed the plaintiffs to explain why the case should not be dismissed for delay and ordered the parties to submit a schedule.
[15] Subsequently, on November 20, 2000 the Court directed the parties [TRANSLATION] "and in particular the plaintiffs, who have the duty of ensuring that this matter moves forward and that this Court's orders are observed" to observe the following schedule:
- filing of a motion for scission by December 15, 2000 at the latest;
- discussions of a settlement within 15 days of the order on the said motion (made on December 7, 2000); and
- filing of application for pre-trial conference within 45 days of the order on the motion for scission.
[16] In December 2000 a copy of the documents cited in the plaintiffs' affidavit of documents was made available to the defendant.
[17] On February 8, 2001 the plaintiffs filed a requisition for and memorandum of a pre-trial conference, which was then set down for March 20, 2001.
[18] On March 7, 2001 the defendant changed counsel.
[19] On March 14, 2001, following the defendant's motion of March 9, 2001 the Court allowed the filing of the defendant's pre-trial conference memorandum to be postponed to June 6, 2001 and the pre-trial conference to June 14, 2001.
[20] In its pre-trial conference memorandum the defendant informed the plaintiffs that it intended to amend the defence and counterclaim after its new counsel had reviewed the file.
Analysis
[21] It appears to the Court that it goes without saying that if the amendments sought by the defendant are authorized the parties' right to proceed with and complete their examinations for discovery will follow that authorization. The Court must therefore consider whether the defendant's motion for amendments should be allowed.
[22] Where the rules applicable to amending pleadings are concerned, the following passage from Canderel Ltée v. Canada, [1994] 1 F.C. 3 (C.A.), at 10, clearly reflects the liberalism which the Court must exercise in such matters:
. . . 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.
[23] As a background to these observations it may be added that in the case of an amendment, like an application to strike pleadings, the amendment should be allowed unless it is clear and obvious that the amendment is doomed to failure (see Raymond Cardinal et al. v. Her Majesty the Queen, an unreported judgment of the Appeal Division of this Court on January 31, 1994, case A-294-77, per Heald, Décary and Linden JJ.A.).
[24] In Visx v. Nidek, [1998] F.C.J. No. 1766, the Federal Court of Appeal also dealt with the following statements taken from an 1886 case:
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 prejudice 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.
(My emphasis.)
[25] The plaintiffs objected to the amendments suggested by the defendant on the ground that they created a new cause of action and were likely to cause them irreparable harm.
[26] The plaintiffs strenuously objected to the fact that in the suggested amendments the defendant was now seeking to radically alter its position as to the validity of the patent in question. They contended that the arguments regarding the invalidity of the patent made by the defendant were in the nature of a new cause of action since in their submission the validity of the patent was initially admitted by the defendant.
[27] I cannot agree with the plaintiffs' approach.
[28] It appears to me that the invalidity of the patent was already present in the defence and that the defendant is now only seeking to add a basis for invalidity. This new basis, like all arguments of prescription and estoppel, are not such as to create an entirely different cause of action from that present in the defence at a later stage, as was the case in Ketteman, cited at p. 11 in Canderel, supra.
[29] As to the harm which may result from the desired amendments, I do not feel that it is such as to cause the plaintiffs harm that could not be compensated for by an award of costs.
[30] I do not think at this stage that the amendments sought can be regarded as frivolous or as seeking to unduly broaden the dispute between the parties. It seems to me that these amendments are more likely to further limit the real points at issue.
[31] The defendant's motion will accordingly be allowed on a schedule protecting the rights of the parties resulting from that amendment.
[32] As to the costs which should be attached to this motion and the pleadings resulting from it, it seems to me these should be borne by the defendant.
[33] It was the defendant which re-opened the debate at quite an advanced stage of the proceeding. Despite the objections which may be made against the plaintiffs in the stages preceding the pre-trial conference, it was the defendant who at that stage, through the new counsel of record, raised the possibility of amending its defence. The amendments made will cause the plaintiffs to amend their reply and defence to the amended counterclaim and require further examinations for discovery and the holding of a second pre-trial conference. The costs for all these additional stages or inconveniences must be borne by the defendant, in the amount of $4,500.
[34] An order will be issued accordingly.
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Richard Morneau
Prothonotary
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MONTRÉAL, QUEBEC
December 13, 2001
Certified true translation
Suzanne M. Gauthier, LL.L. Trad. a.
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