T-3587-77
CC Chemicals Limited (Plaintiff)
v.
Sternson Limited (Defendant)
Trial Division, Cattanach J.—Ottawa, June 19
and August 1, 1980.
Practice — Discovery — Motion to restrain defendant from
proceeding with examination for discovery of inventor/assignor
residing in the U.S. — Ex parte application seeking order to
compel said inventor to submit to a discovery deposition
granted to defendant by foreign Court Claim by plaintiff
that procedure is inappropriate without motion for directions
made to Federal Court — Whether authority to grant order
compelling assignor of a patent not resident in Canada to
attend to be examined for discovery either within or outside
Canada — Federal Court Rules 465(5),(12),(16), 494(9) —
Canada Evidence Act, R.S.C. 1970, c. E-10, s. 43.
Plaintiff moves for an order restraining the defendant from
proceeding with an examination for the discovery of the inven
tor and initial assignor of a patent of invention who is residing
in the United States, otherwise than in accordance with the
Rules of this Court. Defendant, who relied on Rule 465(5)
without result, sought and was granted, by a United States
District Court, an ex parte application without letters rogatory
from this Court for an order directing the inventor to submit to
a discovery deposition upon oral examination in accordance
with the Rules of the foreign Court. Plaintiff claims that
defendant's course of action in relation to the action in this
Court is inappropriate without the procedure to do so first
being settled in a motion for directions made to this Court, and
is contrary to the law of this country. The question is whether
there is authority for the grant of an order whereby the
assignor of a patent who is not resident in Canada can be
compelled to attend to be examined for discovery either within
or outside Canada.
Held, the application is allowed. (1) It is inappropriate for
the defendant to obtain an order from a foreign court to compel
the attendance of an assignor of an invention resident within
that jurisdiction for examination in relation to an action in this
Court without first seeking such process as is available to it: a
particular court is the master of its own procedure and of the
conduct of proceedings before it in conformity with the general
law applicable and its Rules. (2) Rule 465(5) cannot operate
where the person to be examined is outside Canada and cannot
be made the subject of a subpoena issued out of a Canadian
Court (per Jackett C.J. in the Lido case). Such an order cannot
be made because the Court by its own process, cannot enforce
its order: the Rules of the Federal Court do not contemplate it.
Resort may not be had to the issuance of a commission to
examine for discovery the assignor of a patent to be conducted
outside Canada; neither may Letters rogatory nor letters of
request be utilized to achieve that end. The purpose of these
letters is to take evidence out of the jurisdiction for use as
testimony in the action within the jurisdiction. There is no
doubt that defendant was not seeking the assignor's testimony,
but rather information and a train of inquiry. The Court will
restrain a litigant before it from prosecuting proceedings in a
foreign court for the purpose of searching out evidence or
information respecting an action in the Court which proceed
ings in the foreign court are not permissible under its Rules.
The defendant can obtain no "legitimate advantage".
Lido Industrial Products Ltd. v. Teledyne Industries, Inc.
[1979] 1 F.C. 310, applied. Lovell Manufacturing Co. v.
Beatty Bros. Ltd. (1961) 35 C.P.R. 12, applied. Textron
Canada Ltd. v. Rodi & Wienenberger AG [1973] F.C.
667, applied. Xerox of Canada Ltd. v. IBM Canada Ltd.,
IBM Canada Ltée [1976] 1 F.C. 213, applied. Dennison
Manufacturing Co. of Canada Ltd. v. Dymo of Canada
Ltd. (1976) 23 C.P.R. (2d) 155, applied. The Carron Iron
Co. Proprietors v. Maclaren (1854-56) 5 H.L., Cas. 416,
applied. Armstrong v. Armstrong [1892] P. 98, applied.
Re Raychem Corp. v. Canusa Coating Systems, Inc.
[1971] 1 O.R. 192, considered.
MOTION.
COUNSEL:
D. MacOdrum for plaintiff.
J. Morrissey for defendant.
SOLICITORS:
Hayhurst, Dale & Deeth, Toronto, for
plaintiff.
Barrigar & Oyen, Ottawa, for defendant.
The following are the reasons for judgment
rendered in English by
CATTANACH J.: The plaintiff moved by notice
dated June 16, 1980, which application was heard
on June 19, 1980, for an order restraining the
defendant from proceeding with an examination
for the discovery of Solomon J. Rehmar in relation
to this action as assignor of a patent of invention
otherwise than in accordance with the Rules of
this Court.
As the examination was to take place within
three juridical days I gave the order requested at
the conclusion of the hearing of the application but
undertook to give written reasons for so doing.
These reasons are in discharge of that
undertaking.
The plaintiff is a company incorporated pursu
ant to the laws of the Province of Ontario with
head office at Thornhill, Ontario. As such it is
therefore resident and domiciled in Canada.
The defendant is also a company incorporated
pursuant to the laws of the Province of Ontario
with head office in Brantford, Ontario and is
likewise resident and domiciled in Canada.
The plaintiff is owner of a patent of invention
issued by the Patent Office of Canada on October
17, 1967 to Solomon J. Rehmar, of Cleveland,
Ohio, one of the States of the United States of
America with respect to an invention by him.
Rehmar by assignment dated October 27, 1969
and recorded on November 21, 1969 transferred
his rights in that patent to Intrusion Prepakt In
corporated, a company incorporated under the
laws of the State of Ohio.
By assignment dated September 16, 1969 Intru
sion Prepakt Incorporated transferred the patent
to the plaintiff.
By statement of claim dated September 23,
1977 and filed in this Court on that date the
plaintiff alleges that the defendant has infringed
the plaintiff's exclusive rights under that patent
and seeks the usual relief.
The defendant has filed a statement of defence
which basically alleges that no invention is
described in the claims, denies infringement and
alleges the invalidity of the patent. These are
standard defences to an action for infringement.
The allegations are supported by particulars.
By letter dated October 15, 1979 the solicitors
for the defendant inquired of the solicitors for the
plaintiff as to the invention date to be relied upon
which elicited the reply that the invention date
being relied upon was April 4, 1979.
By letter dated September 28, 1978 the solici
tors for the defendant notified the solicitors for the
plaintiff of their intention to examine for discovery
Solomon J. Rehmar as inventor and an officer of
Intrusion Prepakt Incorporated both as assignors.
By letter dated October 30, 1978 in reply the
solicitors for the plaintiff pointed out that both
assignors were resident outside of Canada, that
they represented neither of these parties and that
the Rule upon which the defendant proposed to
rely did not extend to the examination of these
parties out of the country.
The Rule upon which the defendant proposed to
rely was identified in a letter dated October 15,
1979 as Rule 465(5).
The plaintiff made available for discovery its
president.
On April 24, 1980 the defendant advised that
the steps required would be taken to secure the
examination of Rehmar before trial.
The plaintiff reiterated that the Rules did not
permit of the examination of a non-party to the
litigation who is not resident in Canada particular
ly a retired inventor who is not under the control
of the plaintiff.
Mr. Rehmar is over 87 years of age and has
indicated that he would not willingly submit to
examination for discovery. He is not and never was
an employee of the plaintiff and the plaintiff has
no control whatsoever over him.
Apparently there was a telephone conversation
between the solicitors which prompted the plain
tiff's solicitors' letter dated May 22, 1980 and a
reply thereto dated June 4, 1980 which I consider
expedient to reproduce as demonstrative of the
dispute between them.
The plaintiff's solicitors wrote:
We have considered the information given to us by you in
your telephone call of May 18, 1980 that you intend to seek the
discovery of Mr. Rehmar, the inventor named in the patent in
suit in the Federal Court, which currently has jurisdiction over
the subject matter of the dispute between our respective clients.
It appears that you recognize that the Rules of the Federal
Court, and the decisions made under those Rules, do not permit
you to obtain the examination for discovery of Mr. Rehmar. It
further appears to us that you are attempting to by-pass those
Rules, and indeed to by-pass the Federal Court entirely, despite
the fact that this action is to be governed by the Rules of
practice in the Federal Court. It is our concern that your
proposed activities may be considered contemptuous of the
Federal Court, and we are not sure of the extent to which we
should become involved in those activities.
There are a number of questions that arise out of this
proposed procedure, and it is our view that these should be
settled on an application for directions to the Federal Court.
First of all, is it appropriate that Mr. Rehmar be examined,
having regard to the practice of the Federal Court? If Mr.
Rehmar is to give commission evidence, can you establish that
he has refused to appear at the trial of this action? If Mr.
Rehmar is giving commission evidence pursuant to your
request, are you producing Mr. Rehmar as your witness, and
are we to be entitled to cross-examine Mr. Rehmar? If you are
to take commission evidence of Mr. Rehmar, should not the
whole of Mr. Rehmar's evidence be read into the proceedings at
the trial of the action, or are you to be entitled to read in those
portions only which are, in your view, favourable to your case?
As it is our view that your proposed procedure is a clear
attempt to by-pass Rules of the Federal Court, I would suggest
that you bring your application for directions forthwith. If you
do not bring this application, we shall bring our own applica
tion. We see no reason why we should be put to the trouble and
expense of proceeding with a deposition of Mr. Rehmar when
the Rules do not provide for his discovery, and there is further
more no evidence that he has been requested, and has refused,
to appcar at the trial of this action.
The solicitors for the defendant replied:
Your letter of 22 May 1980 was received in our office on 29
May 1980.
If you wish to apply to the Federal Court of Canada for
directions in respect of our proposal to obtain Mr. Rehmar's
deposition then please do so.
In our opinion, our proposed course of action for obtaining
evidence from Mr. Rehmar is not, in any way, contemptuous of
the Federal Court of Canada. Rather, we wish to obtain Mr.
Rehmar's testimony in order that we may have evidence from
the inventor before proceeding to the trial of this action.
In your letter you have stated, "We see no reason why we
should be put to the trouble and expense of proceeding with a
deposition of Mr. Rehmar when the Rules do not provide for
his discovery, and there is furthermore no evidence that he has
been requested, and has refused, to appear at the trial of this
action.". On the contrary, Federal Court Rule 465(5) does
provide for the discovery of Mr. Rehmar. "The assignor of a
patent of invention, copyright, trade mark, industrial design or
any property, right or interest may be examined for discovery
by any party who is adverse to an assignee thereof." (Where
the context so permits, a reference in this Rule to an individual
to be questioned or to the individual being questioned includes
such an assignor.) You have refused consistently to volunteer
Mr. Rehmar for discovery pursuant to Rule 465(5) and, by
virtue of your actions, have left us with no option but to apply
to the appropriate United States court of competent jurisdic
tion. If Mr. Rehmar were a Canadian resident then there would
be no difficulty whatsoever in obtaining his testimony. Instead,
you have relied upon the technical ground that Mr. Rehmar is
a United States resident so as to avoid making him available to
us for discovery.
After reviewing the discovery of Mr. Rehmar, we shall
consider what further steps, if any, are required.
Lastly, we note that this is not the first time that the
pertinent United States statute has been invoked by litigants
involved in proceedings before the Federal Court of Canada.
With respect to the concluding paragraph at the
hearing of the application I asked the solicitor for
the defendant to point out to me the instances to
which he referred, what prior request had been
made to this Court, and if no prior authorization
had been so requested and obtained such as by
way of letters rogatory or a letter of request, was
any evidence so obtained admitted as evidence at
the trial of the action in this Court.
He could not do so. What he meant was that on
three occasions of which he was aware application
had been made to courts in one or other of the
States of the United States to compel a resident to
appear and give evidence independently of any
intercession by this Court but that any evidence so
obtained was apparently not tendered for use as
evidence in a trial of an action before this Court.
Thus I am left without precedent in this Court
which I had fully suspected to be the case.
I expressed the view that it was not within my
jurisdiction to interfere with what a foreign court
may do under the laws which it may administer
and apply. Certainly I have no power to do that. It
was my initial reaction that the matter might best
be left to the Trial Judge to decide the admissibili
ty of evidence so obtained if tendered at trial as
evidence but the order sought by the plaintiff as
applicant herein goes far beyond that.
The suggestion was made by the plaintiff that
for the defendant to seek an order from a foreign
court to compel the attendance of the inventor for
examination in relation to the action in this Court
was most inappropriate without the procedure to
do so contemplated first being settled on a motion
for directions made to this Court.
Frankly the logic of that suggestion has com
mended itself to me but apparently not to the
solicitor for the defendant who blithely ignored the
suggestion so made and initiated a unilateral
application to a judge of the United States District
Court for the Northern District of Ohio, pursuant
to 28 U.S.C. § 1782 for an order directing the
issuance of a subpoena duces tecum commanding
Solomon J. Rehmar to attend and "submit to a
discovery deposition to be taken by Sternson upon
oral examination for use in a proceeding now
pending before the Federal Court of Canada, Trial
Division".
The applicant, Sternson, requested that it be
ordered that "the testimony shall be taken in
accordance with the Federal Rules of Civil Proce
dure". This I take to be Rules applicable in the
foreign jurisdiction because such expression is
unknown in this jurisdiction.
The title to and substantive part of paragraph
1782 (which in all likelihood might be a federal
statute) reads:
§ 1782. Assistance to foreign and international tribunals and to
litigants before such tribunals
(a) The district court of the district in which a person resides
or is found may order him to give his testimony or statement or
to produce a document or other thing for use in a proceeding in
a foreign or international tribunal. The order may be made
pursuant to a letter rogatory issued, or request made, by a
foreign or international tribunal or upon the application of any
interested person and may direct that the testimony or state
ment be given, or the document or other thing be produced,
before a person appointed by the court.
The ex parte application which is undated but
appears to have been filed in the foreign court on
June 10, 1980 was apparently heard on that day
by the judge of that court who endorsed the
margin of the application: "The motion is granted.
It is so ordered. Frank J. Battisti". I assume that
the grant of such an order is not mandatory but
discretionary.
The application was made without notice to the
party adverse in interest and it was unfortunate
that the learned Judge was deprived of the advan
tage of hearing representations contrary to the
grant thereof. Basically the representation vigor
ously advanced before me was that there is no
authority for the grant of an order whereby the
assignor of a patent who is not resident in Canada
can be compelled to attend to be examined for
discovery either within or outside Canada and to
do so is contrary to the law of this country.
The former Chief Justice of this Court had
occasion to consider this question in Lido Indus
trial Products Ltd. v. Teledyne Industries, Inc.
[1979]1 F.C. 310 when he delivered the judgment
of the Appeal Division.
The Trial Division had dismissed an application
for an order to produce the assignor of a patent
resident in the United States to be examined for
discovery pursuant to Rule 465(5). That decision
was appealed.
Jackett C.J. dismissed the appeal because there
is no authority for the order sought. None had
been referred to and he knew of none.
Having so stated he considered it expedient to
explain why the application for that order was not
only misconceived but was an attempt to obtain
relief that is not available under the Rules.
He pointed out at pages 311 and 312:
As I understand it, examination for discovery, as commonly
understood, is a pre-trial process whereby one party to an
action obtains information or admissions from the other and is
one of the few aspects of our procedure that has no root in the
procedure of the United Kingdom. It is now almost universally
found in superior courts in Canada but, in each court, is a
product of the relevant statute and the Rules made thereunder.
The relevant Rule is Rule 465 of the Federal
Court Rules made under section 46 of the Federal
Court Act, R.S.C. 1970 (2nd Supp.), c. 10.
The Chief Justice explained that no order of the
Court is required for an examination for discovery
except in exceptional circumstances.
The simplest case is in an action of one individu
al against another where one party examines
another (Rule 465(1),(2) and (3)). In such a case
no order of the Court is contemplated unless it is
required to nominate an examiner (Rule
465(6)(c)).
The sanction against a party which fails to
submit to discovery or answer questions required
by the Court is, if a defendant, to have the defence
struck out, or, if a plaintiff, to have the action
dismissed.
The second exception is an examination for
discovery of the Crown or a corporation. In the
event that the parties cannot agree on the officer
to be questioned then an order of the Court may
be sought to nominate an officer (Rule 465(1)(b),
(c)).
Under Rule 465(12) it is possible that an exami
nation for discovery may, in certain circumstances,
be held outside Canada but only by an agreement
or with authority of an order of the Court. This is
the third exception to the general rule that no
order of the Court is necessary for arranging for
commencement of an examination for discovery.
Rule 465(5) reads:
Rule 465. .. .
(5) The assignor of a patent of invention, copyright, trade
mark, industrial design or any property, right or interest may
be examined for discovery by any party who is adverse to an
assignee thereof. (Where the context so permits, a reference in
this rule to an individual to be questioned or to an individual
being questioned includes such an assignor).
In commenting upon this somewhat unusual
provision the Chief Justice had this to say at pages
313 and 314:
Rule 465 also includes provision (Rule 465(5)) for something
that is called an examination for discovery but that does not fall
within what is ordinarily thought of as an examination for
discovery of one party by another; it is a pre-trial questioning of
a potential witness, and the only person who can be questioned
thereunder is the assignor of the property right that is the
subject of the litigation, who is subject to being questioned
whether or not he is an officer or other employee of the
opposing party.
The mode of enforcing attendance for examination of a
person subject to questioning by virtue of Rule 465(5) is a
subpoena (Rule 465(9)); as such a person is not necessarily
under the control of the opposing party, that party does not
become subject to having his defence struck out or to having his
action dismissed by reason of such person failing to attend and
answer as required. (Rule 465(20).) Presumably, Rule 465(12)
contemplates the Court authorizing such an examination taking
place outside Canada but one does not find anything in the
Rules authorizing the Court to order such a person to appear
for examination inside or outside Canada; and any such author
ity would not be expected having regard to the provision for a
subpoena in Canada and the Court's inability to issue orders or
other process having effect outside its geographical jurisdiction
(see McGuire v. McGuire [1953] O.R. 328). In other words,
there is an implied limitation, as far as Rule 465 is concerned,
on the ambit of Rule 465(5) in that it cannot operate where the
person to be examined is outside Canada and cannot be made
the subject of a subpoena issued out of a Canadian court. This
is not to say that there may not be an international convention
between Canada and another country, duly implemented by
statute in both countries, that would authorize such examina
tions. I do not recall any such convention that contemplates
pre-trial examination of potential witnesses as opposed to
obtaining evidence in one country for use at trial in another
country.
I have said so much in this connection not only to make it
clear that, in my view, the appellant is not failing to obtain
what he seeks merely because he frames his application inade
quately, but also to make it clear that, in my view, he sought
something that the Rules did not, and could not, give him any
right to obtain. I also have attempted to bring out that there
seems to be a tendency to seek from the Court orders concern
ing the details of launching an examination for discovery
(person to be examined, place, time, etc.) that should not be
taking up the time of the Court when the Rules do not provide
for them.
In argument before me counsel for the defend
ant suggested that if the Chief Justice had been
aware of paragraph 1782 of the United States
Code he would have decided other than he did.
He predicated this submission on the particular
language in the extract quoted which reads:
This is not to say that there may not be an international
convention between Canada and another country, duly imple
mented by statute in both countries, that would authorize such
examinations. I do not recall any such convention that contem
plates pre-trial examination of potential witnesses as opposed to
obtaining evidence in one country for use at trial in another
country.
When the Chief Justice referred to an interna
tional convention implemented into the domestic
law of each contracting state by statute he meant
precisely what he said.
He did not mean a domestic statutory law as
paragraph 1782 of the United States Code appears
to be. He meant, as he said, mutually reciprocal
statutes enacted by the respective States to an
international convention by which the terms of the
convention agreed upon become part of the law of
each State which was party to the convention.
There is no indication that paragraph 1782 is such
a statute.
In so contending counsel must be drawing an
analogy between a law of a foreign State as such
and a law of a foreign State enacted to meet
obligations incurred by being signatory to an inter
national convention. No such analogy exists.
Counsel for the defendant did not refer me to
such a convention no doubt because no such con
vention exists. I should add that I have made a
search for such a convention without avail.
Jackett C.J. has stated that there is an implicit
limitation on the ambit of Rule 465(5) in that it
cannot operate where the person to be examined
for discovery is outside Canada.
Resort may not be had to a commission to take
evidence to conduct an examination for discovery
of the assignor of a patent of invention who is
resident outside Canada.
Cameron J. in Lovell Manufacturing Co. v.
Beatty Bros. Ltd. (1961) 35 C.P.R. 12 said [at
page 13]:
In my view, Rule 129 does not authorize the Court to issue a
Commission to examine for discovery an assignor of any patent
of invention (who, in this case, is not a party in the action)
outside of Canada.
In Textron Canada Ltd. v. Rodi & Wienenberg-
er AG [1973] F.C. 667 Kerr J. held that orders for
commissions to examine assignors of a patent resi
dent in Germany and Japan could not be made
under Rule 477, that is by commission evidence.
Rule 477 of the Federal Court Rules is the succes
sor to Rule 129 of the Exchequer Court Rules
referred to by Cameron J.
However he did entertain the possibility of an
order for discovery under Rule 465(12) analogous
to the kind of order contemplated in Rule 477 on
being satisfied that there were conventions or trea
ties between Canada and Germany and Japan
under which the examinations applied for would be
held in or permitted by the laws of those countries.
He therefore reserved the motion for one month in
order that counsel for the parties might so inquire.
Apparently the Textron case was settled shortly
after the judgment of Kerr J. was delivered and
accordingly the application was not pursued.
In Xerox of Canada Ltd. v. IBM Canada Ltd.,
IBM Canada Ltée [1976] 1 F.C. 213 it was moved
by the defendant before Heald J. for orders
authorizing the issuance of letters rogatory to
permit the examinations for discovery of eighteen
inventors and assignors of patents residing in five
different jurisdictions in the United States. In so
applying the defendant relied on paragraphs (5)
and (12) of Rule 465 and the remarks of Kerr J. in
the Textron case (supra) that is that if he could be
satisfied that an order would be effective under the
laws of the country where the request is to be
executed he would then consider an application to
that end.
In support of the application before Heald J. the
defendant submitted affidavits of a qualified attor
ney from each of the jurisdictions of New York,
Connecticut and two districts in California to the
effect that the courts in these jurisdictions would
execute letters of request from this Court to enable
the defendant to obtain examination for discovery
of the assignors of a patent resident in these
jurisdictions.
In response the plaintiffs filed affidavits of
equally qualified attorneys whose opinions were
diametrically opposite. The firm view was
expressed that the California courts would not act
upon such letters of request because the evidence
so obtained could not be introduced as evidence in
the action but could only be used for the purpose
of gaining information. This may not be necessari
ly so.
The deponents of the rebuttal affidavits were
clearly of the view that the courts of Connecticut
and New York would not act on letters rogatory or
letters of request of this Court because of the
inability of the Federal Court of Canada to recip
rocate under the laws of this country. The inability
to reciprocate has been held to exist.
Under section 43 of the Canada Evidence Act,
R.S.C. 1970, c. E-10, a Canadian court may, in its
discretion, order the attendance in Canada of a
party or witness within its jurisdiction where it
appears that a foreign court of competent jurisdic
tion is desirous of obtaining the "testimony" of
such witness in relation to a matter pending in the
foreign Court.
Section 60 of The Evidence Act of Ontario is to
like effect.
In Re Raychem Corp. v. Canusa Coating Sys
tems, Inc. [1971] 1 O.R. 192, Brooke J.A. said at
page 197:
It is the law of this Province that whether one proceeds under
the relevant provisions of the Ontario Evidence Act, R.S.O.
1960, c. 125, or the Canada Evidence Act, R.S.C. 1952, c. 307,
the Court will order an examination of a witness only if it is
clear that what is intended is the taking of that evidence for the
purpose of trial. No such order will be made if the principal
purpose is to use such proceedings to search out evidence and
information in the same way as on examination for discovery.
In Re Radio Corp. of America v. Rauland Corp. et al., [1956]
O.R. 630 at p. 635, 5 D.L.R. (2d) 424 at p. 428, 26 C.P.R. 29,
Gale, J., as he then was, adopted the language of Devlin, J., in
Radio Corp. of America v. Rauland Corp. et al., [1956] 1 Q.B.
618 at p. 646, when he said:
Testimony which is in the nature of proof for the purpose of
the trial is permissible. Testimony, if it can be called "tes-
timony," which consists of mere answers to questions on the
discovery proceeding designed to lead to a train of inquiry, is
not permissible.
Incidentally I was prompted by the use of the
word "testimony" in paragraph 1782 of the United
States Code to refer to definition of that word in
Black's Law Dictionary, 5th ed., since that work is
definitions of words and phrases of American and
English jurisprudence.
Testimony is therein defined as properly
meaning:
... only such evidence as is delivered by a witness on the trial
of a cause, either orally or in the form of affidavits or
depositions.
Before Mr. Justice Heald the motions sought
were opposed on a twofold basis.
The first submission was that this Court has no
jurisdiction under any circumstances to issue let
ters rogatory to a foreign court.
Heald J., because of the disposition he made of
the motion did not elaborate on the exact nature of
that submission or the reasons advanced in its
support. Conceivably, and I speculate, it may have
been that jurisdiction is lacking in the absence of
an international convention or treaty implemented
by statute in the contracting States that would
authorize examinations of the nature sought or
perhaps that there is no authority in the Federal
Court Act and Rules made thereunder.
The second basis advanced was that "even if this
Court does have the power to issue letters rogato-
ry, that power is discretionary and should not be
exercised to order the examination for discovery of
an assignor who is not a party to the action". This
quotation is extracted from Mr. Justice Heald's
reasons for judgment at page 217. Being extracted
from its whole context and in the light of Rule
465(5) I would assume it might be proper to add
at the conclusion of the quotation words such as
"resident out of the jurisdiction and as directed to
be conducted by the court of the jurisdiction in
which the assignor resides".
Heald J. did state that the discretion should not
be exercised because no reciprocity exists in the
Federal Court of Canada and accordingly a for
eign court should not be asked to do what could
not be done in return.
He refused to issue letters rogatory as requested
because he was not satisfied on the conflicting
evidence of the law in four of those jurisdictions
that the Courts thereof would act on those letters
(there was no evidence as to the law in the fifth
jurisdiction) and further he was not satisfied that
the defendant would be prejudiced by the refusal
of the orders sought because the defendant still
had available to it the normal party examination
procedures under Rule 465.
These same normal party examination proce
dures were available to the defendant in this action
but the defendant has been adamant in its insist
ence upon examining the initial assignor and
inventor for discovery.
Mr. Justice Kerr in the Textron case (supra)
clearly indicated that, in his opinion, an order for
the discovery of an assignor resident out of the
jurisdiction could be devised and granted. He said
this at page 668:
However I think that, in the absence of specific provisions
governing the manner of the examination for discovery of
patent assignors out of Canada, Rule 465(12) permits the
Court to make orders for discovery analogous to the kind of
order provided for in Rule 477(1), or even, but less preferably,
to issue commissions for the examination with appropriate
modifications. I need not at this stage decide what use may be
made of the examination if it takes place, conceivably it may be
useful, even if only informative to the plaintiff. Nor need I
speculate as to whether the assignors will attend for examina
tion, or what recourse the plaintiff may have if they do not
attend.
He added at page 669:
I would be willing to make an appropriate order for the
requested examination for discovery of the assignors in Japan
and Germany or as the case may be, but before making an
order I would want to be satisfied that there would be a
reasonable probability that it would be effective under the laws
of those countries.
Kerr J. based his willingness to grant such an
order on Rule 465(12) which reads:
Rule 465... .
(12) Where an individual to be questioned on an examination
for discovery is temporarily or permanently out of the jurisdic
tion, it may be ordered by the Court, or the parties may agree,
that the examination for discovery be at such place, and take
place in such manner, as may be deemed just and convenient.
Under Rule 465(5) the assignor of a patent may
be examined for discovery by any party who is
adverse to the assignee thereof.
The defendant meets that qualification.
Solomon J. Rehmar meets the qualification of
an assignor who may be examined by the defend
ant. He also meets the qualification of being "an
individual to be questioned on an examination for
discovery ... permanently out of the jurisdiction".
By virtue of Rule 465(16) he:
... shall answer any question as to any fact within his knowl
edge that may prove or tend to prove or disprove or tend to
disprove any unadmitted allegation of fact in any pleading filed
by the assignee... .
The use to which an examination for discovery
may be put at the trial of the action is outlined in
Rule 494(9) which provides in part:
Rule 494... .
(9) Any party may, at the trial of an action, use in evidence
against another party any of his examination for discovery of
that other party, but.....
In view of the express provision of Rule 494(9)
the question immediately arises whether, despite
the provision in Rule 465(5) that the assignor of a
patent who is not a party may be examined for
discovery by a party adverse to the assignee and
who, under Rule 465(16), is obliged to answer
questions with respect to any unadmitted allega
tion in the pleadings, the information so elicited
can be used in evidence. My brother Mahoney has
decided the question posed. I shall refer to his
decision later.
Mr. Justice Kerr did not decide what use could
be made of the examination for discovery should
he order it, other than to remark:
... conceivably it may be useful, even if only informative to the
plaintiff.
Jackett C.J. in the Lido case (supra) has said
that what is described in Rule 465(5) as the
examination for discovery of a non-party is not
within the normal concept of an examination for
discovery. He describes it as the "pre-trial ques
tioning of a potential witness", the assignor of the
industrial property right.
With respect to Rule 465(12) upon which Kerr
J. was prepared to place reliance to order examina
tion for discovery in the Textron case predicated
upon the assumption that the order would be
effective under the laws of the foreign country
Jackett C.J., in considering Rule 465(12) in the
Lido case said:
Presumably, Rule 465(12) contemplates the Court authorizing
such an examination taking place outside Canada but one does
not find anything in the Rules authorizing the Court to order
such a person to appear for examination inside or outside
Canada; and any such authority would not be expected having
regard to the provision for a subpoena in Canada-and the
Court's inability to issue orders or other process having effect
outside its geographical jurisdiction.
It is this, and like considerations, which led
Jackett C.J. to say that Rule 465(5) "cannot
operate where the person to be examined is outside
Canada and cannot be made the subject of a
subpoena issued out of a Canadian court".
As I appreciate his conclusion it is because the
Court by its own process cannot enforce its order
that order will not be made. The Rules of Court do
not contemplate such an order being given.
But Jackett C.J. did not discard the possibility
that other methods might be available to accom
plish that same end.
Resort may not be had to the issuance of a
commission to examine for discovery the assignor
of a patent to be conducted outside Canada: see
Cameron J. in Lovell Manufacturing Co. v. Beatty
Bros. Ltd. (supra) and Kerr J. in the Textron case.
Neither may letters rogatory nor letters of
request be utilized to achieve that end. See Brooke
J.A. in Re Raychem Corp. (supra), Radio Corp.
of America v. Rauland Corp. [1956] 1 All E.R.
549 and Re Radio Corp. of America v. The Rau-
land Corp. [1956] O.R. 630. The reason for this is
that letters rogatory and letters of request are for
the purpose of taking evidence out of the jurisdic
tion for use as testimony in the action within the
jurisdiction. They are not for the principal purpose
to search out evidence and information in the same
way as an examination for discovery.
It was the view of Jackett C.J. that such would
be possible by a duly implemented international
convention.
Mr. Justice Kerr in the Textron case, was not
oblivious that there might be implemented interna
tional conventions or treaties which would permit
an examination for discovery being held in foreign
contracting countries but he was not referred to
any such existing treaties. In the absence of such
conventions or treaties he would nevertheless by
reason of Rule 465(12) make an order analogous
to taking evidence on commission to enable the
conduct of an examination for discovery of the
assignor of a patent resident out of Canada. Before
doing so he required to be satisfied that the laws of
the foreign jurisdiction would permit of this being
done.
Counsel for the defendant was undoubtedly
aware that the United States District Court for the
Northern District of Ohio might accede to such a
request in view of his statement that it was done on
three previous occasions of which he was aware
although where these occasions occurred he did
not say.
In any event, when requested on an ex parte
application, without letters rogatory or letters of
request, to require Solomon J. Rehmar to submit
to a "discovery deposition" to be taken on oral
examination "for use in a proceeding now pending
before the Federal Court of Canada, Trial Divi
sion", the United States District Court for the
Northern District of Ohio did so and in so doing it
acted under paragraph 1782 of the United States
Code.
Therefore the defendant knew that the condition
precedent to the order that Kerr J. contemplated
giving in the Textron case could be met, not only
on an order emanating from this Court but with
out any such order.
It is axiomatic that a particular court is the
master of its own procedure and the conduct of
proceedings before it in conformity with the gener
al law applicable and its Rules. It was for this
reason I considered it inappropriate for the defend
ant to obtain an order from a foreign court to
compel the attendance of an assignor of an inven
tion resident within that jurisdiction for examina
tion in relation to an action in this Court without
first seeking such process as is available to it.
This the defendant did not do.
Rather this Court and its processes were
ignored.
It may be that a motion for directions was
considered by the defendant as being abortive and
contrary to its concept of what the law should be
but that is no reason for not first determining what
the law is by that means if any doubt existed.
There can be no doubt that what the defendant
sought and obtained was not the testimony of
Solomon J. Rehmar as a witness for use in the trial
of this action in which event there would have been
no perceptible impediment to the order for the
issuance of letters rogatory or letters of request.
What was sought and what was obtained without
letters rogatory or letters of request but on a
unilateral application to a foreign jurisdiction is
described as a "discovery deposition" for use in
this proceeding before this Court.
As I understand it an oral deposition in the
United States is a tool for discovery and serves the
same purpose as an examination for discovery does
in this jurisdiction.
Furthermore counsel for the defendant was
candid in his admission that he did not wish to go
to trial without first having subjected the assignor
of the patent to an examination for discovery. He
was not seeking the assignor's "testimony". He
was therefore seeking information and a train of
inquiry.
In the application to the United States District
Court it was alleged that the purpose of the "dis-
covery deposition" upon oral examination was "for
use in a proceeding now pending before the Feder
al Court of Canada".
That representation may have been misleading
and inaccurate. At least it is ambiguous.
Kerr J. in the Textron case did not decide what
use could be made of the examination for discov
ery he contemplated giving other than conjecturing
that it may be useful.
That question arose casually during the course
of representations by counsel for the defendant. I
suggested that at the most it could only be used as
a basis for cross-examination of Mr. Rehmar
should he be called as a witness by the plaintiff at
the trial, and I expressed reservations that any part
of the "discovery deposition" reduced to writing
could be used in evidence at trial under Rule
494(9).
By his decision in Dennison Manufacturing Co.
of Canada Ltd. v. Dymo of Canada Ltd. (1976) 23
C.P.R. (2d) 155 Mahoney J. resolved any such
reservations.
After first quoting Rule 494(9) with appropriate
emphasis he said at page 162:
Admissions obtained on examination for discovery are not
voluntary; they are obtained by lawful coercion. At common
law, they were not admissible as evidence but could be used
only to contradict the party examined during his testimony at
the trial. The admissibility of such admissions as evidence
depends entirely on statute. The only statutory authority in this
instance is Rule 494 (9). That rule is authority only for the use
in evidence, by an adverse party, of admissions obtained from a
party and that is limited to its use against the party who made
the admissions and no other. The assignor is not a party and,
even if he were, his admissions could not, under Rule 494 (9),
be used in evidence against another party.
The reservations I may have entertained conse
quent upon Rules 465(5) and (16) were dispelled
by his answer to a like question posed by counsel
for the defendant before him in these terms:
The question posed by the defendant was: what useful pur
pose is served by permitting, under Rule 464 (5), an examina
tion for discovery of the scope defined by Rule 465 (16), unless
the results may be used as evidence? The purposes of examina
tion for discovery were succinctly stated by Middleton, J., in
Graydon v. Graydon (1921), 67 D.L.R. 116 at pp. 117-18:
It is primarily for the purpose of enabling the opposite party
to know what is the case he is to be called upon to meet, and
its secondary and subsidiary purpose is to enable the party
examining to extract from his opponent admissions which
may dispense with more formal proof at the hearing.
The primary purpose is usefully served by an examination such
as that in question; the secondary purpose is not served and,
indeed, ought not be served since the person being examined is
not the defendant's "opponent" in the context of the action
whatever his stance may be in fact.
These considerations prompted my initial reac
tion that the matter be left to the Trial Judge in
the event that the "oral deposition" or part thereof
might be tendered in evidence at trial.
But as stated the order sought by the plaintiff in
its motion goes far beyond that and, in my view,
there is sound reason for so seeking and ample
jurisprudence justifying the relief sought.
The application to the United States District
Court was supported by an affidavit sworn by the
solicitor for the defendant.
In paragraph 6 thereof the affiant swears that
central issues in the patent infringement action are
(1) the date of the invention by the assignor and
the nature of the invention made and (2) the steps
from its conception to culmination which require
explanation by the defendant. It is also sworn that
the inventor's "testimony" is of great importance.
Testimony is loosely used. The inventor is not
sought as a witness. He is sought to be examined
for discovery. That is what the paragraph of the
affidavit establishes.
After reciting that Mr. Rehmar is not a party to
the action and is not resident in Canada paragraph
9 recites that:
There is therefore no jurisdictional basis by way of subpoena or
otherwise upon which the Federal Court of Canada can compel
Mr. Rehmar to submit to an examination for discovery....
That is accurate and I agree with that statement
but I would put it otherwise in the light of the
decision of Jackett C.J. in the Lido case, Brooke
J.A. in Re Raychem Corp. v. Canusa Coating
Systems, Inc. and in the two decisions sub nom
Radio Corp. of America v. Rauland Corp. which
have been quoted extensively. It is contrary to law
for the Federal Court of Canada to so order.
The Court will restrain a litigant before it from
prosecuting proceedings in a foreign court for the
purpose of searching out evidence or information
respecting an action in the Court which proceed
ings in the foreign court are not permissible under
its Rules.
In The Carron Iron Co. Proprietors v. Maclaren
(1854-56) 5 H.L. Cas. 416 the House of Lords
held that if the circumstances were such as would
make it the duty of one court in this country to
restrain a party from instituting proceedings in
another court here these circumstances will also
warrant that court from imposing on the party a
similar restraint with regard to proceedings in a
foreign court.
Lord Cranworth said at pages 436-437:
There is no doubt as to the power of the Court of Chancery to
restrain persons within its jurisdiction from instituting or prose
cuting suits in foreign courts, wherever the circumstances of the
case make such an interposition necessary or expedient. The
Court acts in personam, and will not suffer any one within its
reach to do what is contrary to its notions of equity, merely
because the act to be done may be, in point of locality, beyond
its jurisdiction.
I appreciate that the Carron case was decided in
1855 but it has been followed and applied as late
as 1928 by Scrutton L.J. in Ellerman Lines, Lim
ited v. Read [1928] 2 K.B. 144 (C.A.).
In The Christiansborg (1885) 10 P.D. 141 the
ship had been arrested and suit commenced
against it in Holland. The ship was released from
arrest on bail being furnished. The ship came to
England and was there arrested by the same party
suing in Holland.
It was moved before Sir James Hannen for the
release of the ship from its arrest under the second
action in England.
Sir James Hannen said at page 143:
The principle on which I think that this question should be
determined is, that where an action has been brought in one
court, and it is not shewn that such court would not do justice,
it is primâ facie oppressive to institute an action in any other
court.
On appeal Baggallay L.J. said at pages 152-153:
I take it to be established by a series of authorities that
where a plaintiff sues the same defendant in respect of the same
cause of action in two courts, one in this country and another
abroad, there is a jurisdiction in the Courts of this country to
act in one of three ways,—to put the party so suing to his
election, or, without allowing him to elect, to stay all proceed
ings in this country, or to stay all proceedings in the foreign
country—it is not in form a stay of proceedings in the foreign
court, but an injunction, restraining the plaintiff from prosecut
ing the proceedings in the foreign country, which of course
cannot be enforced against him if he is a foreigner, and is
neither present in this country nor has property here. It is an
injunction which may become inoperative, but that is how the
proceedings in the foreign Court may in effect be stayed.
The order I granted in this matter restrains the
defendant from prosecuting an examination for
discovery, the order for which is not permissible
under the law in this jurisdiction, but which was
ordered by a foreign court with respect to a pro
ceeding completely within this jurisdiction.
Fry L.J. said at page 155 in The Christiansborg
(supra):
... the institution of the action in the Admiralty Court in this
country was against good faith.
In Ellerman Lines, Limited v. Read (supra) it
was held that the fact that a British subject had
actually obtained judgment in a foreign court did
not prevent an English court from granting an
injunction restraining its enforcement where it was
shown to have been obtained by breach of contract
or by fraud. In granting an injunction the English
court did not seek to assert jurisdiction over the
foreign court. It restrained the person seeking to
enforce the judgment from doing so either in
England or elsewhere. It was an injunction in
personam.
The Judge of first instance had granted the
injunction restraining the enforcement of the for
eign judgment in England but considered he had
no authority to restrain its enforcement outside the
jurisdiction of the English court.
Scrutton L.J. disagreed. He said at page 151:
They [the English Courts] do not, of course, grant an injunc
tion restraining the foreign Court from acting; they have no
power to do that; but they can grant an injunction restraining a
British subject who is fraudulently breaking his contract, and
who is a party to proceedings before them, from making an
application to a foreign Court for the purpose of reaping the
fruits of his fraudulent breach of contract. This appears from a
series of authorities.
Here the injunction is not directed to the foreign
court but to a party in an action before this Court.
The matter was put this way by Atkin L.J. at
page 155:
The principle upon which an English Court acts in granting
injunctions is not that it seeks to assume jurisdiction over the
foreign Court, or that it arrogates to itself some superiority
which entitles it to dictate to the foreign Court, or that it seeks
to criticize the foreign Court or its procedure; the English
Court has regard to the personal attitude of the person who has
obtained the foreign judgment. If the English Court finds that
a person subject to its jurisdiction has committed a breach of
covenant, or has acted in breach of some fiduciary duty or has
in any way violated the principles of equity and conscience, and
that it would be inequitable on his part to seek to enforce a
judgment obtained in breach of such obligations, it will restrain
him, not by issuing an edict to the foreign Court, but by saying
that he is in conscience bound not to enforce that judgment.
The decision which is analogous to the facts in
the present matter is Armstrong v. Armstrong
[1892] P. 98.
This was a petition for divorce by the husband
on the ground of his wife's adultery with the
co-respondent. The petitioner had obtained an
order on commission to examine witnesses in
Vienna. The co-respondent disputed the jurisdic
tion of the Court. Pending the disposition of peti
tion against the jurisdiction of the Court the com
mission to the petitioner to take evidence of the
witnesses in Vienna was suspended. In the mean
time agents of the petitioner in Vienna summoned
witnesses before a tribunal in Vienna appointed to
take evidence for the perpetuation of testimony.
This was done under an order requested of the
Viennese Courts under Article 179 of the Austrian
Code appointing the tribunal for that purpose.
The proceedings in Vienna were more than the
mere taking of proofs because the witnesses were
examined on oath subject to the pressure of foreign
procedure. The proceedings were not auxiliary to
the progress of the action for this evidence when
taken could not be used in the trial of the action
and as such must be considered as separate and
independent action by the petitioner and as useless
and vexatious.
What was sought was an injunction restraining
the petitioner from proceeding under the order of
the Viennese Court in relation to matters in ques
tion in the cause or alternatively that the petitioner
elect to proceed with his suit in England or with
the proceedings commenced by him in Vienna.
The Court made the order restraining the peti
tioner from further prosecuting the proceedings
before the Court at Vienna.
In so doing Jeune J. said [at pages 100-102]:
Is that a proceeding which this tribunal ought to permit the
petitioner to take? I think it is not, and on two main grounds.
First, I think it is useless, in the sense that the petitioner can
obtain no legitimate advantage from it; secondly, I think it is or
may be injurious to the proper course of proceeding in this
Court. It is admitted that the evidence thus taken could not be
used before this tribunal. Apart from other considerations, the
Act of 1857 expressly and exhaustively provides how evidence
may be taken, and by s. 47 it provides that in certain cases a
commission may be issued for the examination of witnesses
abroad in the manner therein specified. But the Court has held
that it is not entitled to order the issue of such a commission in
this case in the position in which it stands at the present
moment. What has been done at Vienna has been represented
as auxiliary to this suit; but it clearly is not auxiliary in the
sense that the evidence taken before the Court in Vienna can in
any way be made available before the Court here. The case of
the Peruvian Guano Co. v. Bockwoldt (23 Ch. D. 225) appears
to me to shew that, whether the second proceeding be before a
foreign tribunal or a tribunal in this country, in either case the
rule is this: that such a proceeding ought not to be allowed if a
person can only obtain an illusory advantage from it. In this
case I think that no legitimate advantage of any kind can be
obtained. This brings me to the second ground to which I have
referred. The only advantage suggested here is that the peti
tioner may be able to bring before the Vienna tribunal wit
nesses whose evidence he does not know, and to take their
proofs under the pressure of an oath. He thus will get to know
all that the witnesses may prove, and he will be under no
obligation to produce that evidence before this Court, as he
would be if the evidence were taken on commission. That
appears to me to be an interference with the proper course of
the administration of justice in this Court. Moreover, we do not
know under what rule of law these witnesses may be examined.
They may, and from what was said by Mr. Ram I gather will,
be unwilling witnesses; and they may be subjected to questions
in the nature of cross-examination by the petitioner's counsel,
and, it appears also, by the Court, and, further, information
beyond their proper evidence may be extracted from them. This
appears to be a mode of dealing with testimony which we
should not allow, and to go far beyond any process of discovery
recognised in the procedure of this country. It amounts to
interrogating your opponent's witnesses before trial. The matter
is not made any better by the argument that the respondent
may have the right of appearing before this tribunal; for though
she may have a right to go, she has also a right to say that she
will not go. It is clear to me, therefore, that the petitioner is not
entitled to do what he has done. He can gain no legitimate
advantage from it; on the contrary, a serious disadvantage may
accrue to the administration of justice. I think he ought to be
restrained from further action of this kind, and there will be a
personal injunction on him restraining him from prosecuting
the proceedings which he has begun before the Vienna tribunal.
Many of the comments on the facts and the law
made by Jeune J. may be extracted and applied to
the facts and law in the present matter.
Here the defendant, like the petitioner before
Jeune J., can obtain "no legitimate advantage".
The evidence obtained in the respective proceed
ings could not be used in the courts seized of the
actions and neither court could nor would grant an
order such as was granted by the foreign court.
The advantage accruing to the defendant is an
advantage to which, in the applicable circum
stances under the law of this jurisdiction, it is not
entitled. That is not a legitimate advantage. The
defendant by invoking the process of a foreign
jurisdiction in a proceeding which is not truly
auxiliary (and could not be without the order of
this Court) to the action properly before this
Court, but separate and distinct therefrom, has
circumvented the law of this jurisdiction by which
law this action must be governed.
This, in my view, is a proceeding which this
Court ought not permit the defendant to take.
It was for those reasons that I gave the order
that I did at the conclusion of the hearing.
The plaintiff shall be entitled to its costs in any
event in the cause.
I cannot leave this matter without saying that
my conclusion has been reached without disrespect
to the United States District Court for the North
ern District of Ohio which these reasons should
clearly indicate. This is what prompted me to say
that the learned Judge of that Court had been
placed at a disadvantage in that representations
contrary to those of the applicant were not avail
able to him.
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.