Saskatchewan Economic Development Corp. v. Westfalia DME, Inc.
T-1158-92
Dubé J.
8/1/93
4 pp.
Motion for interlocutory injunction enjoining defendants from assigning or transferring patents and relevant materials until trial -- Defendant pledging patents to plaintiff as security for loan -- Subsequently defaulted in repayment of loan and plaintiff demanded payment -- Defendant failed to pay -- Executed security agreement with American sister company without notice to other creditors pursuant to which sister company seized patents six days later -- Plaintiff claiming defendant, with intent to defraud creditors, knowingly conspired in absconding with patents -- Application allowed -- Circumstances herein not creating exception to three criteria established by American Cyanamid Co v Ethicon Ltd, [1975] 1 All E.R. 504 (H.L.) and consistently applied in this Court since Turbo Resources Ltd. v. Petro Canada Inc., [1988] 3 F.C. 235 (C.A): (1) serious issue to be tried; (2) irreparable harm; (3) balance of convenience -- At least serious question defendant knowingly developed agreement to pursue common purpose to defeat creditors in favour of sister company -- While affidavit evidence of irreparable harm not as elaborate as could have been, irreparable harm obvious if basic assets of admittedly insolvent company allowed to be dispersed before trial -- As to balance of convenience, status quo cannot irreparably prejudice defendant.