Date: 20100720
Docket: A-220-10
Citation: 2010 FCA 194
Present: SHARLOW
J.A.
LAYDEN-STEVENSON
J.A.
TRUDEL
J.A.
BETWEEN:
DYWIDAG SYSTEMS INTERNATIONAL,
CANADA, LTD.
Appellant
and
GARFORD PTY LTD.
Respondent
REASONS FOR JUDGMENT
LAYDEN-STEVENSON J.A.
[1] The
appellant, Dywidag Systems International, Canada Ltd. (DSI) seeks an order
quashing a notice of cross-appeal filed by the respondent Garford Pty Ltd.
(Garford) in A-220-10.
[2] This
appeal arises in relation to an interlocutory order in an action in which
Garford, as plaintiff, is suing DSI, defendant, for patent infringement and
breach of the Competition Act, R.S.C., 1985, c. C-34. DSI sought an
order bifurcating the liability phase of the action from the damages or
accounting for profits phase. The case management Prothonotary granted the
bifurcation order. A Federal Court judge allowed Garford’s appeal and ordered
as follows:
1. This appeal
is allowed and the order of the Prothonotary dated February 5, 2010
is set aside; and
4. The
plaintiff is entitled to its costs of this appeal fixed at $5,000, inclusive of
fees, disbursements and taxes, and is also awarded its costs of the motion
before the Prothonotary, in an amount to be agreed upon by the parties, or
failing such agreement within 10 days, to be fixed by the Prothonotary.
[3] DSI
filed a notice of appeal from the Federal Court order. Garford filed a notice
of cross-appeal, the grounds for which provide:
▪ The
Learned Prothonotary ordered the proceeding be bifurcated.
▪ Justice
Zinn (the “Trial Judge”) set aside the Order of the Learned Prothonotary.
▪ The
Plaintiff Garford agrees with the disposition of the matter by the Trial Judge.
▪ However,
Garford asks that the Reasons for the Order be varied.
▪
The Plaintiff further traverses or contests all allegations and grounds
made in the
Defendant’s
Notice of Appeal.
[4] DSI, on its motion to quash
the notice of cross-appeal relies on Rule 341(1) of the Federal Courts Rules,
SOR/98-106. It states:
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341. (1) A respondent who
intends to participate in an appeal shall, within 10 days after service of
the notice of
appeal, serve and file
(a) a notice of
appearance in Form 341A; or
(b) where the
respondent seeks a different disposition of the order appealed from, a notice
of cross-appeal in Form 341B.
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341.
(1) L’intimé qui entend participer à l’appel signifie et dépose, dans les 10
jours suivant la signification de l’avis d’appel :
a)
soit un avis de comparution établi selon la formule 341A ;
b)
soit, s’il entend demander la réformation de l’ordonnance portée en appel, un
avis d’appel incident établi selon la formule 341B.
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[5] It is evident that, on its
face, the notice of cross appeal does not seek a different disposition of the
order under appeal. Garford submits that its cross-appeal relates to an issue
that was determined separately from the issues on the appeal, namely the
relevance of evidence of commercial success and the procedure to be followed in
electing damages or profits. Its quarrel is with the Federal Court judge’s
statements at paragraph 14 of the reasons for order, specifically:
The
plaintiff’s submission that the financial information is required with respect
to
the
defence of obviousness is unconvincing. “Commercial success” is no longer a
central
component of the test for obviousness: Apotex Inc. v. Sanofi-Synthelabo
Canada
Inc., [2008] SCC 61 (CanLII), 2008 SCC 61, therefore, the financial
information
which is clearly relevant to the remedy phase is not relevant to the
assessment
of the obviousness invalidity attack. It is true that complete financial
information
may be necessary for the plaintiff, if successful in proving liability, to
properly
elect between damages or an accounting of profits as a remedy; however,
there
is no reason that this election cannot come after the liability phase is
completed…
[6] Garford
submits that because it takes issue with both of these determinations, it
should be permitted to cross-appeal with respect to them. It points to Rule
61.07 of the Ontario Rules of Civil Procedure, R.R.O. 1990, Reg. 194
where a cross-appeal is required in circumstances where a respondent seeks to
set aside or vary the order appealed from, or will seek, if the appeal is
allowed in whole or in part, other relief or a different disposition than the
order appealed from. According to Garford, the Federal Courts Rules
are unintentionally silent as to whether a notice of cross-appeal is required
in a case where the appeal is allowed in whole or in part. Therefore, in
accordance with
Rule 4 of the Federal Courts Rules (reproduced
below), Rule 341(1) should be read in the same manner as the analogous Ontario rule.
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4. On motion, the Court may
provide for any procedural matter not provided for in these Rules or in an
Act of Parliament by analogy to these Rules or by reference to the practice
of the superior court of the province to which the subject-matter of the
proceeding most closely relates.
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4. En cas
de silence des présentes règles ou des lois fédérales, la Cour peut, sur
requête, déterminer la procédure applicable par analogie avec les présentes
règles ou par renvoi à la pratique de la cour supérieure de la province qui
est la plus pertinente en l’espèce.
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[7] First,
I am not persuaded that the Ontario rule is substantively
different than Rule 341(1). Even if it is, as Garford suggests, the application
of Rule 4 depends upon there being a “gap” in the Federal Courts Rules.
Where they provide for a particular matter, but in a different fashion than the
provincial procedural rules, there is no gap: Condux International Inc. v.
Smith, [1989] F.C.J. No. 1056 (F.C.A.); Pharmacia Inc. v. Canada (Minister of National Health
and Welfare),
[1995] 1 F.C. 588 (F.C.A.).
[8] Second,
it is evident, on its face, that the cross-appeal does not seek a different
disposition of the order under appeal. Rather, it is an attempt to
challenge part of the reasons for the Federal Court judge’s decision, not the
decision itself. A cross-appeal is neither necessary nor appropriate in such
circumstances: Froom v. Canada (Minister of Justice), [2005] 2 F.C.R. 195 (F.C.A.). It is
open to Garford to make its submissions, without a notice of cross-appeal, as
an alternative basis upon which the Federal Court judge could have dismissed
DSI’s appeal of the prothonotary’s order: MTS
Allstream Inc. v. Toronto (City), 2006 FCA 89, 348 N.R.143.
See also: Air Canada v. Canada (Commissioner of Competition),
[2002] 4 F.C. 598 (F.C.A.).
[9] The
motion to quash the notice of cross-appeal will be granted, with costs.
“Carolyn
Layden-Stevenson”
“I agree
K.
Sharlow J.A.”
“I
agree
Johanne
Trudel J.A.”
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