Date: 19980914
Docket: T-1712-97
| BETWEEN: |
AIC LIMITED
Plaintiff
-and-
INFINITY INVESTMENT COUNSEL LTD,
INFINITY FUNDS MANAGEMENT INC.,
RICHARD CHARLTON, DAVID SINGH,
JEFFREY LIPTON and GRANT JUNG
Defendants
REASONS FOR ORDER
RICHARD A.C.J.:
BACKGROUND
[1] Pursuant to Section 50 of the Federal Court Act, R.S.C. (1985) ch. F-7, the plaintiff seeks an order to stay this action, pending the disposition of the appeal from the order of Mister Justice Rothstein dated May 5, 1998 or alternatively, an order staying the
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defendants' motion for summary judgment, filed August 4, 1998, pending the disposition of the said appeal and the completion of the examinations for discovery.
[2] The plaintiff is an Ontario corporation with its head office located in Burlington Ontario. Since about 1985, the plaintiff has been carrying on business in Ontario as well as in Canada under the name AIC. In or about 1985, the plaintiff established a group of different mutual funds.
[3] The defendants, Infinity Investment Counsel Ltd and Infinity Funds Managements Inc. are corporations pursuant to the laws of Ontario and carry on business in Ontario and elsewhere in Canada.
[4] The defendants, Richard Charlton, David Singh, Jeffrey Lipton and Grant Jung are individuals resident in the Province of Ontario.
[5] The defendant Richard Charlton, has been Chairman of Infinity Investment Counsel Ltd since the month of February 1997.
[6] The defendant David Singh, is the chairman and director of Infinity Investment Counsel Ltd and Infinity Funds Management Inc.
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[7] The defendant Jeffrey Lipton is Infinity Investment Counsel Ltd's portfolio manager and the defendant Grant Jung is Infinity Investment Counsel Ltd's portfolio analyst.
[8] The plaintiff filed a statement of claim on August 11, 1997 in order to obtain inter alia declaratory and injunctive relief and damages in the amount of $100, 000, 000 for the acts of passing off, trade-mark and copyright infringement, unfair competition and conversion regarding the promotion and distribution of different mutual funds and some other financial services.
[9] Also on August 11, 1997, the plaintiff filed a notice of motion in order to obtain an interim and interlocutory injunction. This motion was subsequently adjourned sine die on consent and has not been heard.
[10] On March 25, 1998, the plaintiff filed a motion to obtain summary judgment on the terms of a settlement agreement, which it alleged had occurred between the parties. This motion was dismissed by the Mister Justice Rothstein, on May 5, 1998.
[11] Mister Justice Rothstein concluded in his reasons that the parties had not reached a settlement agreement and, in any event, any such agreement had been repudiated by the subsequent actions of the parties. In dismissing the plaintiff's motion for judgment
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based on the alleged settlement agreement between the parties, he stated that the action may continue to be prosecuted.
[12] The plaintiff appealed the decision of the Mister Justice Rothstein, on May 15, 1998. The appeal is now pending before the Federal Court of Appeal and has not been heard.
[13] On August 4, 1998, the defendants brought a motion under Rules 213 to 218 of the Federal Court Rules, 1998, for summary judgment dismissing all the claims set out in the statement of claim. A special date for the hearing of the motion was requested by the defendants but has not been fixed, pending the disposition of this motion.
[14] On August 21 1998, the defendants brought the present motion returnable on August 31, 1998, seeking a stay of proceedings.
ISSUE
[15] The issues in this motion to the stay proceedings can be summarized in
one question:
| Having regard to the law and the facts of this case, should the motion to stay these proceedings be granted by this Court? |
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THE APPLICABLE LAW
[16] Subsection 50 (1) of the Federal Court Act, provides that the Court may exercise its discretion to stay proceedings in any cause or matter in two situations: firstly, on the ground that the claim is proceeding in another court or jurisdiction or, secondly, where for any other reason it is in the interest of justice that the proceedings be stayed.
[17] By reason of Section 4 of the Federal Court Act, the Federal Court of Appeal is not a separate court but a division of the Federal Court of Canada as is the Trial Division.
[18] The principle governing the stay of proceedings was well establish by our Court in the judgment of Mister Justice McNair, Varnam12 at page 36:
"A stay of proceedings is never granted as a matter of course. The matter is one calling for the exercise of a judicial discretion in determining whether a stay should be ordered in the particular circumstances of the case. The power to stay should be exercised sparingly and a stay will only be ordered in the clearest cases."
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[19] The test established by this Court in Varnam 3, was followed in Apotex Inc.45, Discreet Logic Inc.67 and in Compulife Software Inc89. It is now established that a stay of proceedings should not be granted unless it can be shown that (1) the continuation of the action would cause prejudice or injustice, not merely inconvenience or additional expense, to the defendant, and (2) that the stay would not be unjust to the plaintiff. The onus is on the party requesting the stay to prove that these conditions exist.
[20] The Supreme Court of Canada has confirmed the principle that a stay of proceedings is a discretionary remedy10.
[21] All of the cases to which I have been referred, deal with a defendant who seeks to stay the plaintiff's action. However, here, I am faced with a most unusual situation. The plaintiff, and not the defendants, seeks to stay a proceeding which it has commenced.
[22] Rule 213 of the Federal Court Rules, 1998, provides:
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| 213. (1) A plaintiff may, after the defendant has filed a defence, or earlier with leave of the Court, and at any time before the time and place for trial are fixed, bring a motion for summary judgment dismissing all or part of the claim set out in the statement of claim. |
| (2) A defendant may, after serving and filing a defence and at any time before the time and place for trial are fixed, bring a motion for summary judgment dismissing all or part of the claim set out in the statement of claim. |
| 213. (1) Le demandeur peut, après le dépôt de la défense - ou avant si la Cour l'autorise- et avant que l'heure, la date et le lieu de l'instruction soient fixés, présenter une requête pour obtenir un jugement sommaire sur tout ou partie de la réclamation contenue dans la déclaration. |
| (2) Le défendeur peut, après avoir signifié et déposé sa défense et avant que l'heure, la date et le lieu de l'instruction soient fixés, présenter une requête pour obtenir un jugement sommaire rejetant tout ou partie de la réclamation contenue dans la déclaration. |
[23] Rule 216 (1) provides that:
| 216. (1) Where on a motion for summary judgment the Court is satisfied that there is no genuine issue for trial with respect to a claim or defence, the Court shall grant summary judgment accordingly. |
| 216. (1) Lorsque, par suite d'une requête en jugement sommaire, la Cour est convaincue qu'il n'existe pas de véritable question litigieuse quant à une déclaration ou à une défense, elle rend un jugement sommaire en conséquence. |
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[24] Rule 219 of the Federal Court Rules, 1998 provides:
| 219. In making an order for summary judgment, the Court may order that enforcement of the summary judgment be stayed pending the determination of any other issue in the action or in a counterclaim or third party claim. |
| 219. Lorsqu'elle rend un jugement sommaire, la Cour peut surseoir l'exécution forcée de ce jugement jusqu'à la détermination d'une autre question soulevée dans l'action ou dans une demande reconventionnelle ou une mise en cause. |
[25] A defendant may apply for summary judgment at any time after filing and serving a statement of defence.
ANALYSIS
[26] The defendants assert that they are entitled to make there defence against the serious allegations made by the plaintiff in this proceeding and that the rules of this Court contemplate that the defendant may apply for summary judgment at any time after a defence has been filed.
[27] It is for the plaintiff to establish that the defendants will not suffer any prejudice as a result of the stay of proceedings.
[28] In this case, the plaintiff has failed to demonstrate that the bringing of a motion for summary judgment by the defendants would result in such prejudice or injustice to the plaintiff.
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[29] The plaintiff claims that its appeal from the judgment of Mister Justice Rothstein would be illusory, if the defendants were successful in their motion to obtain summary judgment before the Federal Court of Appeal has ruled on the validity of the settlement agreement. This is an issue which the plaintiff may wish to raise before the motion judge.
[30] However, I note that the Federal Court of Appeal has been asked to determine that the parties have entered in to a contract to settle the action, whereas the motion judge is being asked to determine whether or not there is a genuine issue for trial, with respect to any issue in the statement of claim.
[31] Our Court has established that the power to stay proceedings should be exercised sparingly and only ordered in the clearest cases. Following these principles and the present facts, I cannot grant the present motion for a stay of proceedings.
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CONCLUSION
| [32] The motion for a stay of proceedings is therefore denied. Costs of this motion are awarded to the defendants. |
____________________________
Associate Chief Justice
Ottawa, Ontario
September 14, 1998
__________________1 Varnam
2 v. Canada (Minister of national health and welfare) et al. (1987), 12 F.T.R. 34 (T.D.).
3 Supra, note 1.
4 Apotex Inc.
5 v. Attorney-general of Canada et al., (1993) 50 C.P.R. (3d) 376.
6 Discreet Logic Inc.
7 v. Canada (Registrar of Copyrights) et al, (1993) 51 C.P.R. (3d) 191.
8 Compulife Software Inc
9. v. Compuoffice Software Inc., (1997) 77 C.P.R. 451.
10 Canada (Ministry of Citizenships & Immigration) v. Tobiass, #25811, 25 September 1997 (S.C.C.).