T-831-82
Algonquin Mercantile Corporation (Plaintiff)
v.
Dart Industries Canada Limited (Defendant)
Trial Division, Reed J.—Toronto, January 23;
Ottawa, February 2, 1984.
Practice — Stay of execution -- Application to stay execu
tion of judgment ordering industrial design expunged from
register — Judgment appealed, but no motion for stay of
execution — Design expunged — Application allowed —
Delay in seeking stay due to mistaken belief appeal triggering
stay — Plaintiff acting expeditiously since notice of expunge -
ment — Delay not sufficient to deny relief — More likely to
mislead public by allowing expungement to stand should
appeal be successful — "Or other relief' in R. 1909 encom
passing stay of execution pending appeal, notwithstanding
judgment executed — Plaintiff meeting burden of proof
Omark Industries, Inc. v. Sabre Saw Chain (1963) Limited,
[1977] 2 F.C. 550; 32 C.P.R. (2d) 145 (T.D.) considered —
Respective damages to parties considered — Defendant's
product not infringing plaintiff's registered design so can
continue to manufacture and sell — No substantial argument
addressed to R. 341A — Federal Court Rules, C.R.C., c. 663,
RR. 341A, 1909.
Jurisdiction — Federal Court — Trial Division — Applica
tion to stay execution of judgment after design expunged from
register — Wilkinson Sword (Canada) Limited v. Juda, Arthur
(Continental Watch Import Co.), 119671 1 Ex.C.R. 421; 34
Fox Pat. C. 169 and The King v. Consolidated Distilleries
Ltd., 11931] Ex.C.R. 125 distinguished — Cases relating to
situation before creation of Federal Court of Appeal — Deal
ing with applications for stay of execution of Exchequer Court
decisions appealed to Supreme Court of Canada, and different
legislation — Industrial Design Act, R.S.C. 1970, c. 1-8, s. 22
— Trade Marks Act, S.C. 1952-53, c. 49, s. 56(1).
Industrial design — Application to stay execution of judg
ment after design expunged from register — Application
allowed — Plaintiff acting expeditiously since notice of
expungement — Plaintiff satisfying burden of proof —
Respective damages to parties considered — Industrial Design
Act, R.S.C. 1970, c. I-8, s. 22.
CASES JUDICIALLY CONSIDERED
DISTINGUISHED:
Wilkinson Sword (Canada) Limited v. Juda, Arthur
(Continental Watch Import Co.), [1967] I Ex.C.R. 421;
34 Fox Pat. C. 169; The King v. Consolidated Distilleries
Ltd., [1931] Ex.C.R. 125.
CONSIDERED:
Re Occhipinti et al. and Discipline Committee of the
College of Pharmacy, [1970] 1 O.R. 741 (C.A.); Omark
Industries, Inc. v. Sabre Saw Chain (1963) Limited,
[1977] 2 F.C. 550; 32 C.P.R. (2d) 145 (T.D.); Marketing
International Ltd. v. S. C. Johnson and Son, Limited,
[1977] 2 F.C. 618; 35 C.P.R. (2d) 226 (C.A.).
REFERRED TO:
Re Great Northern Capital Corporation Ltd. et al. and
City of Toronto et al. (1973), 1 O.R. (2d) 160 (H.C.).
COUNSEL:
Ronald E. Dimock for plaintiff.
G. A. Macklin, Q.C. for defendant.
SOLICITORS:
Sim, Hughes, Toronto, for plaintiff.
Gowling & Henderson, Ottawa, for defend
ant.
The following are -the reasons for order ren
dered in English by
REED J.: This is an application for the suspen
sion of part of a judgment of Mr. Justice Mahoney
rendered on June 2, 1983 [1984] 1 F.C. 246
(T.D.). It is the part of that judgment which
ordered the plaintiff's [hereinafter sometimes
referred to as the applicant] registered design
expunged from the register which underlies this
application.
An appeal from that part of Mr. Justice
Mahoney's judgment was filed by the plaintiff on
August 17, 1983 but no motion was brought at
that time for a stay of execution. The plaintiff
appears to have thought that the taking of the
appeal was sufficient to trigger a stay. The plain
tiff subsequently received a letter from the Depart
ment of Consumer and Corporate Affairs, dated
December 23, 1983, stating that its registered
design had been expunged pursuant to the June 2,
1983 judgment.
Counsel for the respondent [hereinafter some
times referred to as the defendant] argued that a
stay of execution or suspension should not now be
granted because: (1) this Court did not have juris
diction to grant such a motion; alternatively (2)
the applicant could not now seek a stay of execu
tion when he had not done so during the past six
months and before the Registrar had acted to
expunge the design; and (3) in any event, the
applicant had not satisfied the burden of proof
required of it.
In support of his first argument counsel cited
the decision of Thurlow J. (as he then was) in
Wilkinson Sword (Canada) Limited v. Juda,
Arthur (Continental Watch Import Co.), [1967] 1
Ex.C.R. 421; 34 Fox Pat. C. 169 where an order
for a stay of execution of the expungement of a
trade mark registration was refused.
It was argued that the Wilkinson decision stood
for the proposition that, in the case of an expunge -
ment order, unless a party applied for a stay of
judgment before judgment was rendered there was
no authority in the Court under Rule 1909 [Fed-
eral Court Rules, C.R.C., c. 663] to stay execu
tion. The Court's jurisdiction in this regard, it was
argued, was different from its jurisdiction with
respect to equitable remedies or money awards.
After a careful reading of the Wilkinson case
(supra) and the decision in The King v. Con
solidated Distilleries Ltd., [1931] Ex.C.R. 125 to
which it refers, I am of the view that these cases
do not lay down so wide a rule. They relate to the
situation existing before the Appeal Division of the
Federal Court was created and deal with applica
tions for a stay of execution for Exchequer Court
decisions which had been appealed to the Supreme
Court of Canada. In addition, the Wilkinson case
dealt with subsection 56(1) of the Trade Marks
Act [S.C. 1952-53, c. 49] which accorded the
Court authority to strike out or amend entries in
the register which do not "accurately express or
define the existing rights of the person appearing
to be the registered owner of the mark." (Under-
lining added.) In the present case the application is
made under section 22 of the Industrial Design
Act [R.S.C. 1970, c. I-8]. That section is some
what more broadly framed and authorizes the
Court to "make such order for making, expunging
or varying any entry in any such register as the
Court thinks fit...." (Underlining added.)
Accordingly, I am of the view that the Wilkinson
case does not preclude the granting of the relief
sought.
With respect to the argument that the applicant
had many months and several opportunities during
that time to bring a motion for stay of execution, I
do not think that the delay in this case is sufficient
to deny the relief claimed. The plaintiff appeared
to be operating on the mistaken assumption that
no action was necessary by it to preserve the status
quo pending appeal. The first notice it had that
this was not the case was the letter of December
23, 1983 from the Department of Consumer and
Corporate Affairs. Since that time the applicant
has acted expeditiously to have the issue resolved.
Equally, I am not persuaded that significant
harm to the public would now occur should the
plaintiff's registration be reinstated. It was argued
that members of the public would be misled and
would be operating on false assumptions if they
had searched the register subsequent to the
expungement signalled by the December 23 letter
and before any order staying the June 2, 1983
judgment might be given. It seems to me there
would be even greater opportunity for public mis
apprehension if the plaintiff's design remains
expunged and the decision of Mr. Justice Mahoney
were eventually to be overturned by the Federal
Court of Appeal.
It was also argued that while the Court might
have had jurisdiction to stay or suspend judgment
before the Registrar had acted to expunge the
design registration this was no longer the case. The
judgment having been executed it was argued an
order under Rule 1909 would now be an amend
ment or alteration to the judgment and not a stay
or suspension. In this regard I would note that
while counsel for the defendant called attention to
the existence of Rule 341A, counsel for the plain
tiff did not address any substantial argument to
that Rule.
Rule 1909 provides:
Rule 1909. A party against whom a judgment has been given or
an order made may apply to the Court for a stay of execution
of the judgment or order or other relief against such judgment
or order, and the Court may by order grant such relief, and on
such terms, as it thinks just. [Underlining added.]
I could find no authority directly on point but
the words "or other relief ' would seem broad
enough to encompass the relief claimed in this
case: a stay of judgment pending appeal and an
order rectifying the register of industrial designs
nunc pro tunc. Of some interest is the decision of
Mr. Justice Jessup of the Ontario Court of Appeal
in Re Occhipinti et al. and Discipline Committee
of the College of Pharmacy, [1970] 1 O.R. 741.
The learned Justice stayed the execution of an
order expunging the registration of pharmaceutical
chemists pending appeal of the original judgment.
This appears to have been done at a time after the
expungement was made since that order was dated
November 1, 1969 and the judgment carries the
date November 3, 1969. That decision of course
was made in reference to the Ontario Rule 506
[Rules of Pratice, R.R.O. 1960, Reg. 396] which
does not have the benefit of the words "or other
relief' which occur in Rule 1909. I note with
respect to the decision of Mr. Justice Jessup that
his order was given out of an abundance of caution
since in Ontario a stay of execution (subject to
conditions and exceptions) occurs automatically
with the bringing of an appeal. Such automatic
stay of execution pending appeals is the rule in
several jurisdictions.
I would not want to conclude without making
reference to counsel's argument on the burden of
proof. Three cases were cited: Omark Industries,
Inc. v. Sabre Saw Chain (1963) Limited, [1977] 2
F.C. 550; 32 C.P.R. (2d) 145 (T.D.); Re Great
Northern Capital Corporation Ltd. et al. and City
of Toronto et al. (1973), 1 O.R. (2d) 160 (H.C.);
Marketing International Ltd. v. S. C. Johnson and
Son, Limited, [1977] 2 F.C. 618; 35 C.P.R. (2d)
226 (C.A.). Particular reference was made to com
ments in the Omark case, at page 554 [F.C.]; at
page 147 [C.P.R.]:
On an application of this kind, the burden on the applicant is
greater than that of a party seeking an interlocutory
injunction ....
In the case of an interlocutory injunction, how
ever, the respective damage to the two parties is an
important consideration. This factor was con
sidered in the Omark case and in both the Great
Northern Capital case (supra) and the Marketing
International case (supra). In the latter Chief
Justice Jackett speaking for the Federal Court of
Appeal said at page 621 F.C.; at pages 230-231
C.P.R.:
In our view, where an injunction has been granted by a final
judgment, prima facie, it should remain in force until that
judgment has been found, on appeal, to be wrong.
However, there are cases where the "interests of justice"
require interference.... Where the preponderance of irrepa
rable detriment to the defendant flowing from maintaining the
injunction in force pending appeal (if the judgment should turn
out on appeal to be wrong) in relation to the irreparable
detriment to the plaintiff, if any, flowing from suspending the
injunction pending appeal (if the judgment should turn out to
be correct) is such that the interests of justice require that the
injunction should be suspended pending appeal, then the Court
should exercise its discretion to do so.
In the present case virtually no harm would
occur to the defendant as a result of a stay of
judgment. The disputed industrial design was reg
istered in February, 1980. The plaintiff subse
quently commenced manufacture and sale of the
cooking appliance to which the design related. On
February 9, 1983 the plaintiff brought an action
against the defendant alleging that it was produc
ing a product that infringed the registered design.
Mr. Justice Mahoney's decision of June 2, 1983
found that the defendant's product did not infringe
the plaintiffs registered design, that the two appli
ances did not look very much alike at all, in
addition, that the plaintiffs design was not regis-
trable because it had been published in Canada
more than one year prior to its registration. Thus
the defendant can manufacture and sell its non-
infringing product regardless of whether the plain
tiffs registered design is reinstated pending appeal
or not. In addition, as noted above the position of
the public at large is more consistently maintained
if the design is reinstated. In the circumstances I
think the plaintiff has met the burden of proof.
Accordingly I would allow the plaintiffs
application.
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.