T-3099-74
Marubeni Corporation (Plaintiff)
v.
The Ship Star Boxford and Blandford Shipping
Co. Ltd. and Star Shipping Co. A/S (Defendants)
Trial Division, Walsh J.—Vancouver, October 9
and 10, 1975.
Practice—Motion to amend defence—Motion to require
plaintiff to produce documents and officer for discovery—
Defendants wishing to examine plaintiff in respect of all
previous instances where defendants have carried goods for
plaintiff—Whether special nexus beyond mere similarity—
Federal Court Rule 465(15).
In an attempt to show that defendants had carried similar
goods under similar conditions for plaintiff previously without
complaint, and that no greater damage could now have been
suffered than that which must have occurred on earlier occa
sions, and been acquiesced in by plaintiff, defendants moved to
amend their statement of defence, and to have plaintiff produce
records dealing with all previous shipments, and an officer of
the company, for examination.
Held, granting the motion in part, the issue may be raised.
Defendants cannot enlarge the scope of the proceedings by
requiring production of documents relating to previous ship
ments. Evidence of similar acts is collateral only, "unless some
special nexus is shown, creating a relationship beyond mere
similarity". Defendants have established no such nexus. More
than an allegation in a statement of claim or defence is required
to vastly enlarge the scope of proceedings. It was never the
intent of Rule 465(15) that merely by making a sweeping
allegation in a defence raising collateral issues, the door would
be opened by defendants' own pleadings to extend the scope of
their examination far beyond allegations in the statement of
claim, with no right in the Court to control or limit.
Babcock v. Canadian Pacific Railway Co. (1916) 27
D.L.R. 432, and Metropolitan Asylum District v. Hill 47
L.T. (N.S.) discussed. East Asiatic Company (Canada)
Ltd. v. The Ship "Aegis Bravery" (unreported, T-371-73)
applied.
MOTION.
COUNSEL:
D. F. McEwen for plaintiff.
P. D. Lowry for defendants.
SOLICITORS:
S. M. Lipetz, Vancouver, for plaintiff.
Macrae, Montgomery, Spring and Cunning-
ham, Vancouver, for defendants.
The following are the reasons for judgment
delivered orally in English by
WALSH J.: Defendants move for leave to amend
their defence in accordance with the terms of the
draft amended defence annexed to their motion;
and that plaintiff produce all outturn and ware
house reports, all reconditioning invoices and sales
receipts, in its custody and control that relate to
the damage of linerboard, sack kraft or kraft paper
carried aboard the several vessels operated by the
defendant Star Shipping A/S from Kitimat, Brit-
ish Columbia to Kawasaki and Osaka, Japan,
during the years 1971, 1972, 1973, 1974; and that
plaintiff produce Mr. Keije Kurosawa for discov
ery and that he be compelled to answer questions
relating to the outturn condition and sale of liner-
board and sack kraft or kraft paper delivered to
the plaintiff from Kitimat, British Columbia by
the several vessels operated by the defendant Star
Shipping A/S during the years 1971, 1972, 1973
and 1974.
The motion to amend the defence results from a
judgment rendered on October 2, 1975 refusing to
order the production of the documents referred to
in the second part of the defendants' motion save
with respect to the six shipments of linerboard for
which damage claims have been brought, including
the present action, which judgment read in part:
"There is nothing in the pleadings to the actions
brought ... which would justify at this stage of the
proceedings an inquiry into any claims which may
or may not exist respecting other voyages or ma
terial other than linerboard to which the existing
actions are limited."
Plaintiff opposes the amendment to the defence
on the ground that the allegations do not disclose a
reasonable cause of defence and could be struck on
an application under Rule 419, and that therefore
the Court should not exercise its discretion to
permit the amendment by virtue of Rule 420.
Certainly the proposed amendments depart very
substantially from the original defence and raise
entirely new issues, and this, after the conclusion
of examination for discovery of defendants' witness
Mr. Dodd, so if leave to amend is granted it would
have to be on terms that the production of him for
further examination as a result of the amended
defence would be done at defendants' expense.
The amended defence basically raises the issue
that since defendants have been carrying liner-
board and sack kraft and kraft paper under identi
cal conditions to plaintiff for some years without
any complaint as to their condition on outturn save
for minor and normal handling damage, defend
ants are convinced that the damage now com
plained of in the present proceedings and the other
five voyages which have led to claims must have
existed in all 20 voyages with respect to which
information is sought, and further that since plain
tiff did not complain previously, which would have
put defendants on their guard with respect to the
conditions of packaging, stowage etc. which might
be necessary to avoid such damage, there has been
acquiescence by plaintiff so that it cannot now
complain of the damages for which claims have
now been made which defendants believe to be no
greater than damages which may have been suf
fered in previous shipments for which no claim was
made.
Such a defence is tenuous to say the least but I
am not dealing here with a motion to strike and in
any event I believe this is a matter which should
properly be left for the trial judge. Halsbury: Laws
of England, 3rd edition vol. 14, has this to say
about acquiescence as an element of estoppel at
1179.
When A stands by while his right is being infringed by B the
following circumstances must as a general rule be present in
order that estoppel may be raised against A .... (4) A must
know of B's mistaken belief; with that knowledge it is inequit
able for him to keep silent and allow B to proceed on his
mistake.
The cases referred to deal with different circum
stances, however, such as allowing someone to
build on property which you know to be yours,
without complaint, and it is extremely doubtful
whether this doctrine could be applied in the
present circumstances, even if defendant could
establish that similar damage occurred in previous
shipments, without complaint by plaintiff.
Defendants' counsel concedes that defendants
have no definite indication of any previous damage
but assume that it must have occurred because
packaging and shipping conditions were identical
and that plaintiff should have advised it of such
damage. They hope to prove this by evidence from
plaintiff's own witnesses and documents. This
appears to me to be analogous to an automobile
manufacturer when confronted by a claim for
damages because a wheel has fallen off a new car
just delivered saying that it must have often hap
pened before because all the cars are similarly
made and inspected, and that it is not liable
because the existence of these previous accidents
have never been called to its attention thereby
enabling it to take additional precautions in future.
However, as indicated I will permit the issue to be
raised, for what it is worth, by allowing the
amendment, on terms as set out above.
This does not mean to say the defendants can go
on a fishing expedition and vastly enlarge the
scope of the proceedings by requiring plaintiff to
produce for inspection outturn and warehouse
reports and all reconditioning invoices (mostly
requiring translation from Japanese) for all ship
ments over a 4 year period with respect to which
no damage complaints have been made, including
sack kraft and kraft paper, neither of which is the
subject of the present action or 5 similar claims for
linerboard damage, or that Mr. Kurosawa should
be subjected to lengthy and exhaustive questioning
on such collateral issues. In this connection I
would refer to Babcock v. Canadian Pacific Rail
way Co. (1916) 27 D.L.R. 432 at page 440 and to
the case of Metropolitan Asylum District v. Hill
47 L.T. (N.S.) 29; referred to therein. See also
Sopinka and Lederman: The Law of Evidence in
Civil Cases at page 15. "It will be apparent on the
slightest reflection that there are degrees of rele
vance. It is not surprising that the courts, desiring
to restrain proceedings within manageable limits,
have evolved categories of inferior facts which are
either entirely excluded, or admitted subject to
strict conditions.", and again at page 19, "Evi-
dence of similar acts is considered collateral, and
therefore irrelevant, unless some special nexus is
shown which creates a relationship beyond mere
similarity. General similarity is not sufficient."
It must be pointed out that these cases dealt
with the relevance of evidence which a party was
seeking to introduce and still required some "nex-
us" to the claim in question before it was allowed.
In the present case defendants have at this stage,
established no such nexus; on the contrary they
complain that plaintiff did not make any claims
except for minor and routine shipping damages
with respect to previous shipments: this should not
open the door to an assumption that major dam
ages must have occurred and an inquiry into them.
It requires more than an allegation in a statement
of claim or a defence to justify vastly enlarging the
scope of the action and departing from the actual
issue involved, namely damages allegedly occur
ring to linerboard on certain specific shipments.
A somewhat similar conclusion was reached by
my brother Collier J. in an unreported case of East
Asiatic Company (Canada) Ltd. v. The Ship
"Aegis Bravery" (No. T-371-73, judgment dated
December 5, 1974) in which he stated: "In my
view, nevertheless, in an application of this kind,
where a defendant takes the position the inspection
sought is not relevant, nor otherwise permissible,
there must be sufficient material on which the
court can arrive at a decision as to relevance or
privilege."
Defendants' counsel relies on the very broad
provisions of Rule 465(15) relating to the scope of
examinations for discovery which permits ques
tioning respecting facts in "any pleading filed by
the party being examined for discovery or the
examining party" as permitting him to examine
plaintiff's witness on the allegations in the amend
ed defence relating to damage to previous ship
ments and other merchandise (sack kraft and kraft
paper). I cannot conceive that it was ever the
intent of this Rule that by merely making a very
sweeping allegation in a defence, raising collateral
issues, the door would be opened by defendants'
own pleadings to extend the scope of the examina
tion far beyond the allegations of plaintiff's state
ment of claim, and that the Court would have no
right to control or limit the extent of this
questioning.
In view of the amended defence, defendants may
certainly question the witness Kurosawa as to
whether similar extensive damage was noted with
respect to linerboard shipments on previous voy
ages, and if he admits this, then some questioning
as to the extent of this damage, the steps taken to
mitigate it, and why no complaint or claim was
made is permissible, including, if necessary the
production of documents to substantiate any such
damages or reconditioning. I do not accept the
argument of defendants' counsel however, that if
plaintiff's witness, when examined denies the exist
ence of any such damage, he is then still entitled to
examine plaintiff's outturn and warehouse reports,
reconditioning invoices and sales receipts to ascer
tain whether he is telling the truth. In the absence
of any nexus to indicate the existence of any such
damage, such further questioning would not in my
view be permissible. The admissibility or
non-admissibility of any specific question will be of
course a matter to be decided by a judge before
whom the issue is raised, if defendants insist on an
answer to a question which is objected to.
Moreover defendants' counsel states he refuses
to proceed with the examination for discovery until
he has examined the documents in question. Since
I have found that these documents (except for
those referred to in my judgment of October 2)
may only be examined in the event that the
groundwork is laid as a result of answers by the
witness indicating the existence of the uncom-
plained-of damage which defendants suspect, the
examination, if it is to take place, must be proceed
ed with, without prior inspection, of these docu
ments. In this connection it should be pointed out
that a special hearing took place on October 2,
1975 of defendants' previous motion for produc
tion of documents because the Court was advised
that arrangements had been completed for the
examination for discovery of plaintiff's witness in
Japan commencing Wednesday, October 8 and
that both counsel were about to leave for there to
participate in the examination. When defendants
did not get a favourable judgment on the said
motion, defendants' counsel then failed to go to
Japan for the examination, claiming it would be
useless to do so since plaintiff's counsel had
already indicated, as is not denied, that he would
object to any questions relating to damage to the
other shipments. Plaintiff's counsel proceeded to
Japan however, and is still there awaiting the
examination, if it is to proceed. The issue of the
eventual costs arising from this impasse, and
whether defendants' counsel was justified in decid
ing it would be useless to proceed to Japan as
arranged are not before me. However, in view of
the amended defence some questioning of Mr.
Kurosawa on this question will now be permitted
on a limited basis as I have indicated. Defendants'
counsel now states he has other commitments pre
venting him from going to Japan at this time. I do
not consider this a valid reason for a unilateral
decision on his part not to proceed with the exami
nation and believe it should be commenced without
further delay while plaintiff's counsel is still in
Japan for this purpose. Again, the question of
costs, or the consequences of any failure by
defendants' counsel to proceed with the examina
tion are issues to be decided at a later date.
ORDER
1. Defendants are permitted to amend their
defence in accordance with the draft amended
defence annexed to the motion on the term that
defendants will produce at their own expense and
at plaintiffs convenience the witness Dodd for
further examination for discovery as a result of
these amendments.
2. Plaintiff is not required to produce at this time
the documents referred to in paragraph 2 of
defendants' motion relating to other shipments and
other materials than those which are the subject of
the present action and other 5 claims.
3. Mr. Keiji Kurosawa may be asked whether
plaintiff encountered similar damage in previous
shipments by defendants of linerboard, and if so,
the extent of same and the steps taken to recondi
tion the damaged cargo, and to produce documen
tation relating to this in the event he admits such
damage (other than minor and normal carriage
damage) was encountered. If he denies the exist
ence of any such damage he will not be required to
produce any documentation or other evidence to
establish that in fact, no such damage existed.
The costs of this motion are in favour of plain
tiff in any event of the cause.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.