[1995] 3 F.C. 330
A-649-94
Merck & Co., Inc. and Merck Frosst Canada Inc. (Appellants) (Defendants)
v.
Richter Gedeon Vegyészeti Gyar Rt (Respondent) (Plaintiff)
Indexed as: Richter Gedeon Vegyészeti Gyar Rt v. Merck & Co. (C.A.)
Court of Appeal, Isaac C.J., Stone and Robertson JJ.A.—Ottawa, June 23 and July 10, 1995.
Practice — Discovery — Examination for discovery — Appeal from interlocutory order dismissing motion pursuant to RR. 456(5), 462(4) for order for examination for discovery of eight assignors/inventors of respondent’s patent resident in Hungary — Motions Judge finding necessity inventors explain patents not demonstrated — R. 456(5) giving party adverse in interest to assignee, who is also party, right to examine assignor — Not requiring demonstration evidence necessary as condition precedent to examination.
Patents — Practice — R. 456(5) providing for examination for discovery of patent assignor by party adverse in interest to assignee — Motions Judge refusing to order examination of assignors/inventors resident in Hungary — Of opinion inventors not needed to explain inventions as anyone skilled in science could replicate patent — Where assignor Canadian resident, party wishing examination not required to show assignor needed to explain fact in issue — Nor is requirement implied where judicial assistance sought, assignor being non-resident.
Construction of statutes — Federal Court Rules, s. 456(5) providing where assignee party to action, assignor may also be examined for discovery — Motions Judge holding appellants entitled to examine only one of eight assignors/inventors of patent — Erred in refusing to heed Interpretation Act, s. 33(2) providing words in singular include plural, words in plural include singular.
International law — Motions Judge dismissing motion for order for examination for discovery of eight assignors/ inventors of respondent’s patent residing in Hungary — Disregarding international Convention providing for mutual assistance in legal proceedings pending in either contracting state because not enacted by statute — Evidence Convention in effect in Canada, Hungary — Convention facilitating legal proceedings in contracting states, not altering municipal law of either — Validity not depending on implementation by statute — Should be construed liberally to give effect to purpose, intent.
This was an appeal from an interlocutory order dismissing a motion pursuant to Federal Court Rules, subsections 456(5) and 462(4) for an order for examination for discovery of eight assignors/inventors of the respondent’s patent who were resident in Budapest, Hungary. The respondent claimed ownership of the patent as assignee of nine inventors, eight of whom are still its employees. The appellants denied infringement and alleged invalidity.
Subsection 456(5) of the Rules provides that where an assignee is a party to an action, the assignor may also be examined for discovery. Subsection 462(4) of the Rules provides that where the person to be examined orally resides outside Canada, the place, manner, costs and expenses of the oral examination shall be as agreed upon by the person and the parties or as ordered by the Court.
The Motions Judge concluded that the assignors/inventors were not needed to explain the inventions, since anyone skilled in the art or science of the inventor could, from inspection of the patent, replicate it upon the expiration of the monopoly. He found that the appellants had not demonstrated “the necessity of requiring such persons to attend any oral examination for discovery”. In any event, he ruled that the appellants were entitled to examine only one of the eight assignors/inventors. Since the appellants had not designated the person to be examined for discovery, he declined to make the order. He also refused to give effect to the Convention between His Majesty in Respect of the United Kingdom and the Regent of the Kingdom of Hungary Regarding Legal Proceedings in Civil and Commercial Matters providing for mutual assistance in the conduct of legal proceedings. There was uncontradicted evidence that this Convention was, and still is, in effect in Canada and Hungary, but the Motions Judge held that he could consider the Convention only if it had been duly enacted by statute in both Canada and Hungary. The appellants’ submissions were that the Motions Judge had erred: (1) by imposing a requirement that they must demonstrate that the assignors/ inventors’ evidence was necessary; (2) in placing a limitation on the number of assignors/inventors who may be examined pursuant to subsection 456(5) of the Rules; and (3) in disregarding the evidence regarding the Convention.
Held, the appeal should be allowed.
(1) A party to an action wishing to examine an assignor who is resident in Canada may do so as of right provided that the provisions of section 462 of the Rules respecting the service of a direction to attend and the payment of conduct money have been satisfied. There is no legal requirement that the examining party should demonstrate to anyone, as a condition precedent to the examination, that the assignor is needed to explain a fact in issue or that the attendance of the assignor for an oral examination for discovery is necessary. Subsection 462(4) of the Rules contemplates judicial assistance where the persons to be examined reside outside Canada, absent agreement between the persons to be examined and the parties, but it does not either expressly or by necessary implication impose those requirements. Since their imposition is supported neither by principle nor authority, the Motions Judge erred in imposing them.
(2) The Motions Judge also erred in concluding that the appellants were entitled to examine but one assignor/inventor. Subsection 456(5) of the Rules speaks in the singular, but Interpretation Act, subsection 33(2) provides that words in the singular include the plural, and words in the plural include the singular. The authorities on which the Motions Judge relied did not support the restrictive construction that he placed on subsection 456(5) of the Rules, and he erred in refusing to heed the direction of Interpretation Act, subsection 33(2).
(3) The purpose of the Convention is to facilitate legal proceedings in the contracting states. It does not alter the municipal law of any contracting state. Hence in Canadian practice its validity or effectiveness does not depend upon due implementation by statute. It should be construed liberally to give effect to its true purpose and intent. When so construed, the examinations for discovery of the assignors/inventors come within the definition of “taking of evidence” in Article 7.
STATUTES AND REGULATIONS JUDICIALLY CONSIDERED
Canada Evidence Act, R.S.C., 1985, c. C-5, s. 10 (as am. by S.C. 1994, c. 44, s. 86), Part II.
Convention between His Majesty in Respect of the United Kingdom and the Regent of the Kingdom of Hungary Regarding Legal Proceedings in Civil and Commercial Matters, 25 September 1935, [1939] Can. T.S. No. 6, Art. 7.
Federal Court Rules, C.R.C., c. 663, RR. 332(1), 455 (as am. by SOR/90-846, s. 15), 456 (as am. idem), 457 (as am. idem), 458 (as am. idem), 459 (as am. idem), 460 (as am. idem), 461 (as am. idem), 462 (as am. idem), 463 (as am. idem), 464 (as am. idem), 465 (as am. idem, 466 (as am. idem), 466.3 (as enacted by SOR/92-726, s. 4), 494(9) (as am. by SOR/90-846, s. 21).
Interpretation Act, R.S.C., 1985, c. I-21, ss. 2, 3(1), 33(2).
CASES JUDICIALLY CONSIDERED
APPLIED:
Zingre v. The Queen et al., [1981] 2 S.C.R. 392; (1981), 127 D.L.R. (3d) 223; 10 Man. R. (2d) 62; 61 C.C.C. (2d) 465; 23 C.P.C. 259; 38 N.R. 272.
DISTINGUISHED:
Corning Glass Works v. Canada Wire & Cable Company Limited, [1984] 2 F.C. 42 (1983), 1 C.I.P.R. 163; 77 C.P.R. (2d) 76 (T.D.); Sternson Ltd. v. CC Chemicals Ltd., [1982] 1 F.C. 350 (1981), 124 D.L.R. (3d) 76; 58 C.P.R. (2d) 145; 36 N.R. 507 (C.A.); Lido Industrial Products Ltd. v. Teledyne Industries, Inc., [1979] 1 F.C. 310 (1978), 91 D.L.R. (3d) 81; 41 C.P.R. (2d) 1; 23 N.R. 100 (C.A.).
REFERRED TO:
Dennison Manufacturing Co. of Canada Ltd. v. Dymo of Canada Ltd. (1975), 23 C.P.R. (2d) 155 (F.C.T.D.); Abitibi-Price Sales Corp. v. Wilhelm Wesch (The), [1987] 2 F.C. 579 (1987), 10 F.T.R. 14 (T.D.).
AUTHORS CITED
Castel, J.-G. Canadian Conflict of Laws, 3rd ed., Toronto: Butterworths, 1994.
Department of Foreign Affairs. Bilateral and Multilateral Treaty Actions Taken by Canada, 1992.
Freedman, B. J. and G. N. Harney. “Obtaining Evidence from Canada: The Enforcement of Letters Rogatory by Canadian Courts” (1987), 21 U.B.C. L. Rev. 351.
Gotlieb, A. E. Canadian Treaty-Making. Toronto: Butterworths, 1968.
Hogg, Peter. Constitutional Law of Canada, 3rd ed., Scarborough: Carswell, 1992.
Kindred, H. M. et al. International Law Chiefly as Interpreted and Applied in Canada, 5th ed., Toronto: Emond Montgomery Publications Ltd., 1993.
APPEAL from an interlocutory order dismissing a motion pursuant to Federal Court Rules, subsections 456(5) and 462(4) for an order for examination for discovery of eight assignors/inventors of the respondent’s patent who were resident in Hungary ((1994), 87 F.T.R. 230 (F.C.T.D.)). Appeal allowed.
COUNSEL:
G. Alexander Macklin, Q.C. and Jane E. Clark for appellants (defendants).
Ronald E. Dimock and Solomon R. Avisar for respondent (plaintiff).
SOLICITORS:
Gowling, Strathy & Henderson, Ottawa, for appellants (defendants).
Avisar, Hunt & Yan, Ottawa, for respondent (plaintiff).
The following are the reasons for judgment rendered in English by
Isaac C.J.: This is an appeal from an interlocutory order made by a motions judge in the Trial Division on 28 November 1994 [(1994), 87 F.T.R. 230] in an action by the respondent for infringement of its patent. The order dismissed a motion by the appellants for an order pursuant to subsections 456(5) and 462(4) of the Federal Court Rules, C.R.C., c. 663 [as am. by SOR/90-846, s. 15] (hereinafter “the Rules”) for the examination for discovery of eight assignors/inventors of the respondent’s patent who are resident in Budapest, Hungary.
In the action, the respondent claims ownership of the patent as assignee of nine inventors, eight of whom are still its employees. The appellants defend the action on several bases, including denial of infringement. They also allege invalidity of the patent on the ground, among others, that the persons named in the patent as inventors are not the inventors of any patentable subject-matter.
The appellants filed their motion on 18 August 1994. In it, they joined to their request for the discovery of the eight assignors/inventors in Budapest, a request for an order that three employees of the respondent be produced for discovery in Budapest as representatives of the respondent corporation and for the issue of letters of request directed to the Central District Court of Pest seeking the assistance of that Court for the examination in Budapest of all these employees, in relation to the infringement action pending in this Court. The materials before the Motions Judge indicate that the examinations for discovery were scheduled to be conducted during the week of 12 to 16 September 1994, inclusive. The motion was heard on 23 August 1994. On 28 November 1994, the Motions Judge made the order dismissing the motion. He gave several reasons.
He dismissed as premature the motion made pursuant to subsection 456(4) [as am. idem] of the Rules for an order that certain persons named by the appellants be required to attend in Budapest to be examined for discovery on behalf of the respondent corporation. The Motions Judge pointed out, correctly in my respectful view, that by virtue of subsection 456(2) [as am. idem] of the Rules, the right to designate the person or persons to be examined for discovery on behalf of the respondent corporation is given to the respondent in the first instance and not to the appellants or to the Court. Until the respondent’s designates had demonstrated during the examination for discovery that they were not informed persons within the meaning of subsection 456(2) of the Rules, the appellants could not invoke to their benefit the provisions of subsection 456(4) of the Rules. Since the examinations for discovery in this case had not yet been held, the Motions Judge dismissed that part of the motion, but without prejudice to the appellants’ right to renew the application in appropriate circumstances. No appeal is taken from this portion of the order.
The Motions Judge then turned his attention to the appellants’ request pursuant to subsections 456(5) and 462(4) of the Rules for an order to examine eight of the nine assignors/inventors for discovery in Budapest. He dismissed this branch of the motion for several reasons. First, he said that the assignors/ inventors were hardly needed to explain the inventions to anyone, since by definition, any person reasonably skilled in the art or science of the inventor could, from inspection of the patent, replicate it upon the expiration of the monopoly. Secondly, he found that the appellants had not demonstrated by evidence “the necessity of requiring such persons [the assignors/inventors] to attend any oral examination for discovery” (at page 233). Thirdly, and in any event, the Motions Judge concluded, on the authority of Corning Glass Works v. Canada Wire & Cable Company Limited, [1984] 2 F.C. 42(T.D.), that the appellants were entitled to examine only one of the eight assignors/inventors, despite the direction in subsection 33(2) of the Interpretation Act, R.S.C., 1985, c. I-21. Since the appellants had not designated the person to be examined for discovery, he declined to make the order. He declined as well to give effect to the Convention between His Majesty in Respect of the United Kingdom and the Regent of the Kingdom of Hungary Regarding Legal Proceedings in Civil and Commercial Matters, signed at Budapest 25 September 1935, Can. T.S. 1939 No. 6, to which Canada has acceded, (hereinafter “the Convention”), as the appellants had asked.
The appellants object to the order in as far as it dismissed the motion pursuant to subsections 456(5) and 462(4) of the Rules. They allege several grounds of error. First, they allege that the Motions Judge erred by imposing a requirement that the appellants demonstrate that the assignors/inventors are needed to explain the patent and that their evidence is necessary. They submit that subsection 456(5) of the Rules does not on its face or by necessary implication impose either requirement; secondly, they allege that he erred in placing a limitation on the number of assignors/inventors who may be examined pursuant to subsection 456(5) of the Rules; thirdly, they state that he erred in reading into subsections 456(5) and 462(4) of the Rules a requirement that the assignors/ inventors be amenable to the subpoena jurisdiction in this Court; and finally, they say that he disregarded the evidence respecting the Convention. For its part, the respondent seeks to uphold the order, contending that the Motions Judge was right in every conclusion that he reached.
I will deal with each ground of objection in turn. However, since the resolution of the issues which they raise invites consideration of provisions of the Rules promulgated in 1990, it might be useful to reproduce the relevant rules here. To the extent that the Motions Judge grounded his conclusions on principles laid down by this Court or by the Trial Division in cases decided before 1990, I reproduce as well former Rule 465 which regulated the procedure relating to examinations for discovery. Rule 456 reads in relevant part:
Rule 456. (1) A party may, without leave of the Court, examine for discovery any adverse party only once.
(2) Where a corporation or an unincorporated group or body of persons is to be examined for discovery, it shall select an informed officer, director, member or employee to be examined on its behalf.
…
(4) The Court may, on the application of a party entitled to examine the person selected under paragraph (2) or (3), order that some other person be examined.
(5) Where an assignee is a party to an action, the assignor may also be examined for discovery. [Emphasis added.]
Rule 462 reads in relevant part:
Rule 462. (1) A party who intends to examine an adverse party by way of an oral examination for discovery shall
(a) serve a direction to attend (Form 21) on the adverse party and a copy of it on every other party to the action; and
(b) unless the parties otherwise agree, serve conduct money on the adverse party in an amount to cover any reasonable living and travelling expenses of the person to be examined.
(2) Where a party intends to examine an assignor or a bankrupt under Rule 456(5) or (6), the direction to attend and the conduct money shall be served on that person.
…
(4) Where the person to be examined for discovery orally resides outside Canada, the place, manner, costs and expenses of the oral examination shall be as agreed upon by the person and the parties or as ordered by the Court.
Former Rule 465 read in relevant part:
Rule 465. (1) For the purpose of this Rule, a party may be examined for discovery, as hereinafter in this Rule provided,
(a) if the party is an individual, by questioning the party himself,
(b) if the party is a corporation or any body or group of persons empowered by law to sue or to be sued, either in its own name or in the name of any officer or other person, by questioning any member or officer of such corporation, body or group,
…
and, in this Rule, a party who is being, or is to be, so examined for discovery is sometimes referred to as the “party being examined” or the “party to be examined”, as the case may be, and the individual who is being, or is to be, questioned is sometimes referred to as the “individual being questioned” or the “individual to be questioned”, as the case may be.
…
(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).
…
(7) Upon request of the party who proposes to exercise a right under this Rule to examine for discovery, a person who is qualified by paragraph (6) to be the examiner and who has agreed so to act for the particular examination shall issue an appointment signed by him fixing the time when, and the place where, the examination is to be conducted (Such appointment shall indicate the names of the examining party, the party to be examined for discovery and the individual to be questioned).
(8) An appointment issued under paragraph (7), together with appropriate conduct money, shall be served upon the attorney or solicitor for the party to be examined in the case of any examination for discovery other than one falling under paragraph (1)(b) or paragraph (5); and it shall be so served in the case of an examination for discovery falling under paragraph (1)(b) if the Court so orders before the service is effected; and, in any case to which this paragraph applies, no notification other than service of the appointment on the attorney or solicitor for the party to be examined is necessary.
(9) In any case to which paragraph (8) does not apply, the attendance of the individual to be questioned may be enforced by subpoena (which may be a subpoena ad testificandum or a subpoena duces tecum) in the same manner as the attendance of a witness at the trial of an action. In any such case, the appointment issued under paragraph (7) shall be served on the attorney or solicitor for the party to be examined or the party adverse in interest to the examining party, as the case may be.
…
(12) Where an individual to be questioned on an examination for discovery is temporarily or permanently out of the jurisdiction, 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.
…
(15) Upon examination for discovery otherwise than under paragraph (5), the individual being questioned shall answer any question as to any fact within the knowledge or means of knowledge of the party being examined for discovery that may prove or tend to prove or disprove or tend to disprove any unadmitted allegation of fact in any pleading filed by the party being examined for discovery or the examining party.
(16) Upon examination for discovery of a person under paragraph (5), he shall answer any question as to any fact within his knowledge 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 or the examining party. [Emphasis added.]
Unlike the former Rules which provided in Rule 465 a complete code to regulate the conduct of examinations for discovery, the present Rules have established a simplified scheme formulated, in some instances, in different language. Thus, Rules 455-461 [as am. idem] regulate the conduct of examinations for discovery generally; Rules 462-466 [as am. idem] regulate the conduct of oral examinations for discovery and Rule 466.3 [as enacted by SOR/92-726, s. 4] provides for the pre-trial questioning of non-parties. It should be noticed that, unlike former Rule 465, the present Rules do not compel attendance by subpoena, but provide in Rule 461 a range of sanctions for non-compliance.
Subsection 456(5) of the Rules is clear and unambiguous. It reads:
Rule 456….
(5) Where an assignee is a party to an action, the assignor may also be examined for discovery.
On its face, the subsection gives to a party to an action who is adverse in interest to an assignee who is also a party to the action, a right to examine the assignor. The right is exercisable at the discretion of the party adverse in interest to the assignee. In my opinion, the subsection assumes that the assignor will depose to facts that are relevant to issues in the litigation. It has been held that the purpose of former subsection 465(5) of the Rules, which gave a similar right, was to enable the party examining to obtain facts to prepare the case to be met and to obtain statements from the assignor which could be used for purposes of impeachment in cross-examination, if the assignor were called as a witness at trial. See Sternson Ltd. v. CC Chemicals Ltd., [1982] 1 F.C. 350(C.A.), at page 358 and Dennison Manufacturing Co. of Canada Ltd. v. Dymo of Canada Ltd. (1975), 23 C.P.R. (2d) 155 (F.C.T.D.), at pages 161-162.
The right given in subsection 456(5) of the Rules is separate from and independent of that which is given in subsections 456(1), (2) or (3) of the Rules to examine an adverse party, if an individual, or an informed officer, director, member or employee, if a corporation or the Crown. Thus, a party to an action wishing to examine an assignor who is resident in Canada may do so as of right provided that the provisions of Rule 462 respecting the service of a direction to attend and the payment of conduct money have been satisfied. In such a case, the examining party has no need to invoke the assistance of the Court unless it be to ask that the sanctions prescribed in Rule 461 be imposed in an appropriate case. In the case of an assignor who is resident in Canada there is no legal requirement that the examining party should demonstrate to anyone, as a condition precedent to the examination, that the assignor is needed to explain a fact in issue or that the attendance of the assignor for an oral examination for discovery is necessary. But the Motions Judge was not asked to lend his assistance for the examination for discovery of assignors/inventors who are resident in Canada. The persons to be examined were all resident in Budapest. Subsection 462(4) of the Rules contemplates judicial assistance in such a case, absent agreement between the persons to be examined and the parties. However, subsection 462(4) of the Rules does not either expressly or by necessary implication impose those requirements. Since their imposition is supported neither by principle nor authority, I must conclude that the Motions Judge erred in imposing them.
As regards the second ground of objection, i.e., that the Motions Judge was wrong in concluding that the appellants were only entitled to examine one assignor/inventor, I need only say that I am in complete agreement with the appellants’ contention. It is true that subsection 456(5) of the Rules speaks in the singular. But as everyone knows, the subsection is part of an enactment as defined in section 2 of the Interpretation Act. The provisions of that Act are, by subsection 3(1) thereof, made applicable to every enactment. Subsection 33(2) contains a clear and unambiguous direction that in construing federal enactments, such as the Rules:
33. …
(2) Words in the singular include the plural, and words in the plural include the singular.
In his reasons, the Motions Judge adverted to that provision, but, being of the view that it fell to him to prevent [at page 233] “the orgy of examinations implicit in [the appellants’] seeking to examine eight assignors”, he refused to heed its clear direction. He preferred instead to rely upon the decision of Walsh J. in Corning Glass Works, supra, and to tease out of the decisions of this Court in Lido Industrial Products Ltd. v. Teledyne Industries, Inc., [1979] 1 F.C. 310(C.A.) and Sternson Ltd. v. CC Chemicals Ltd., supra, support for his position that only one assignor/inventor could be examined. The first point to notice about these cases is that they were all decided before 1990, under former Rule 465.
Lido Industrial Products Ltd. is first in time. In that case, the defendant [appellant] in an action for infringement of a patent sought to examine pursuant to former subsection 465(5) of the Rules two assignors of the patent who were resident in the United States. The defendant [appellant] asked that they attend for examination before a Special Examiner in Toronto. The request was dismissed in the Trial Division and that dismissal was affirmed on appeal. For a unanimous Court, the Chief Justice gave two reasons for dismissing the appeal. First, he said that subsection 465(5) of the Rules contained an implied territorial limitation since an order of the Court was enforceable only by subpoena which had no validity outside of Canada. Secondly, the defendant [appellant] had not proved any international convention which allowed the pre-trial examination of potential witnesses as opposed to obtaining evidence for use at trial in Canada. The report of this case contains no discussion of the issue whether the examination should be restricted to a single assignor. I should add that even though there is an indication in the report that the Trial Division had refused the request to examine two non-resident assignors, the appeal was limited to the refusal as to a single one. No explanation is given for the limitation.
Sternson Ltd., supra, was an appeal from a judgment of the Trial Division [[1981] 1 F.C. 541 restraining a defendant in an action for infringement from pursuing in the United States the examination for discovery of an assignor of the patent resident there pursuant to an order of a United States District Court. The Court allowed the appeal. The dispositive reasons of Ryan J., writing for a unanimous Court, appear in the following passage at page 359:
It is true that, for the reasons given in the Lido case, the Trial Division of the Federal Court could not have ordered the examination of Mr. Rehmar for discovery. This would be so because Mr. Rehmar would not be subject to a subpoena issued in Canada, but for this reason only. I do not see, however, why this should prevent the appellant from going into a United States Court which has jurisdiction over Mr. Rehmar to obtain under applicable United States law the sort of order it could have obtained from the Federal Court had Mr. Rehmar, the assignor of the patent, been within Canada. The sort of procedure invoked abroad is a procedure which is available in the Federal Court action in respect of an assignor of a patent who is subject to service in Canada. The examination conducted abroad will, of course, have no status under Rule 465. That does not mean, however, that it would be illegitimate to conduct it.
As in Lido Industrial Products Ltd., there is no discussion in Sternson Ltd. of the issue whether an examination conducted pursuant to former subsection 465(5) of the Rules should be restricted to a single assignor.
In Corning Glass Works, supra, the defendants in an action for infringement moved under former Rule 465 for leave to serve an appointment for discovery on one of two assignors/inventors of the patent who was resident in the United States of America. It appears that the other assignor/inventor had already been examined for discovery on behalf of the plaintiff corporation and during the examination had undertaken to inform himself and to provide information sought by the defendants. In refusing leave Walsh J. quoted former subsection 465(5) of the Rules and stated at pages 46-47:
The word “assignor” is used in the singular and there is nothing to indicate that in the case of a co-inventor both parties may be examined for discovery. Doctor Schultz who was being examined undertook to inform himself of Doctor Maurer, and while it may be that it would be useful for defendants to also be able to make inquiries of the co-inventor Doctor Maurer, this does not necessarily justify a second examination since under our procedure, unlike that in the United States, normally only one person can be examined on behalf of a corporation. Doctor Schultz was so examined. It is true that paragraph (19) of Rule 465 does permit the Court, for special reason in an exceptional case, in its discretion, to order a further examination for discovery after a party or assignor has been examined for discovery under the Rule, but this is a provision which is infrequently used.
In any event the real issue is that this Court cannot effectively issue a subpoena requiring a non-resident to come to Canada to be examined, even if conduct money is tendered. [Emphasis added.]
In that case, the Motions Judge does not appear to have considered the direction in subsection 33(2) of the Interpretation Act. In any case, it is clear that the passage of his reasons just quoted was not necessary for his decision.
In sum, I conclude that the authorities which the Motions Judge relied on in the present case do not support the restrictive construction that he placed upon subsection 456(5) of the Rules and that he was wrong in refusing to heed the clear and unambiguous direction of subsection 33(2) of the Interpretation Act.
Each of the cases relied on was concerned with the territorial limitation of subpoenas issued by the Court and directed to non-residents. The concern is a valid one since it is fundamental that the Court will not issue processes that it cannot enforce. But as the Chief Justice stated in Lido Industrial Products Ltd., supra, that concern would disappear if the process could be enforced by virtue of an effective international convention.
The concern expressed in those cases respecting the reach of the Court’s processes applies with equal force to processes issued under the present Rules, even though compellability by subpoena is no longer the mode of securing attendance. The appellants recognized this limitation and tendered before the Motions Judge evidence of the Convention which, in their view, provides an effective mechanism to enforce any order that the Court might make pursuant to subsection 462(4) of the Rules for the examination of the assignors/inventors in Budapest. They submit that the Motions Judge disregarded this evidence. Reduced to essentials, the appellants’ position is that subsection 462(4) of the Rules invests the Court with a discretion to order oral examinations for discovery of non-residents; but they recognize the Court will only make such an order where it is likely that it will be effective. The Convention proved in evidence before the Motions Judge demonstrates that such an order could be effective in this case. For these reasons, they say, this Court should make such an order and issue a Letter of Request.
Before examining the appellants’ submission on this point, I wish to make some observations on the nature of the evidence they tendered.
The appellants proved the Convention and its effectiveness both in Canada and Hungary by filing the affidavit of Birgit Baasch, an articling student in the law firm of Gowling, Strathy & Henderson, who are solicitors for the appellants. A copy of the Convention, published by the King’s (now the Queen’s) Printer, is annexed as Exhibit H to the affidavit. Also annexed as Exhibit I are pages from a document compiled by the Department of Foreign Affairs entitled Bilateral and Multilateral Treaty Actions Taken by Canada, 1992. This document contains the following entry for Hungary:
Legal Proceedings:
Convention between the United Kingdom and Hungary regarding Legal Proceedings in Civil and Commercial Matters.
Budapest, September 25, 1935
Entered into force April 1, 1939
Notes
Extended to Canada as of April 1, 1939 by an Exchange of Notes dated March 1 and 23, 1939 (CTS 1939/6)
Suspended during World War II and revived as from February 27, 1948.
In paragraph 13 of her affidavit Ms. Baasch deposed on information and belief that the Convention and Exchange of Notes are still in force. The source of this information is said to be a telephone conversation between the deponent and the Registrar of the Treaty Section in the Department of Foreign Affairs. Similarly, in paragraph 15, Ms. Baasch deposed as follows:
15. I am informed by Klara Kaszo, an attorney at law, practicing in Budapest, Hungary, and verily believe that if an order were to be granted by the Federal Court of Canada and a Letter of Request issued from this Court to the Court of Hungary, requiring the attendance of the Hungarian citizens with respect to Canadian civil proceedings including those proceedings with the Federal Court of Canada, that, under the aforementioned Convention, the Hungarian Courts will enforce the Canadian Order and the Minister of Justice will act upon the Letter of Request, to compel the attendance of the Hungarian citizens for that purpose. Ms. Kaszo also advised that the Convention was still in force.
Given the provisions of subsection 332(1) of the Rules that on interlocutory motions, facts may be proved by affidavit on information and belief, the proof offered by the appellants is sufficient, but barely so. The better practice would have been for the appellants to prove those facts by filing an affidavit by the Treaty Registrar as to the effectiveness of the Convention in Canada and another by the Hungarian attorney as to its effectiveness in Hungary, based on their own knowledge.
At any rate, the Motions Judge had before him uncontradicted evidence that there was in force between Canada and Hungary a convention for mutual assistance in the conduct of legal proceedings in civil and commercial matters and evidence that a Hungarian court would honour a Letter of Request by this Court for assistance in securing the attendance of the assignors/inventors for examinations for discovery in Budapest. The Motions Judge gave no effect to this evidence, claiming a want of proof of Hungarian law. He also seemed to be of the view that lack of proof that the Convention had been duly implemented in both Canada and Hungary was a fatal defect. As a result he considered the appellants’ request as an application under Part II of the Canada Evidence Act, R.S.C., 1985, c. C-5, and in the end he declined to issue letters rogatory under that Part. He was right in doing so not for the reason he gave but because that Part had no application to the case before him. Part II of the Canada Evidence Act is concerned with the taking of evidence in proceedings pending in courts outside Canada and not, as here, in proceedings pending in courts in Canada.
So the Motions Judge was left with the Convention as the only mechanism to enforce the order that the appellants had requested. The evidence before him indicated that the Convention was in force in Canada and in Hungary, but he disregarded it because he was of the view that he could consider the Convention only if the appellants had proved that it had been duly enacted by statute in both Canada and Hungary. For him [at page 236], “executive branch agreements of a long-gone government of the day” would not do, even though there was uncontradicted evidence that the agreement is in force.
The Convention was concluded in Budapest on 25 September, 1935 between the heads of state of the United Kingdom and the Kingdom of Hungary, by their respective plenipotentiaries.
The preamble reads:
His Majesty the King of Great Britain, Ireland and the British Dominions beyond the Seas, Emperor of India, and His Serene Highness the Regent of the Kingdom of Hungary: being desirous to render mutual assistance in the conduct of legal proceedings in civil and commercial matters, which are being dealt with or which it is anticipated may be dealt with by their respective judicial authorities; have resolved to conclude a Convention for this purpose and have appointed as their Plenipotentiaries:
His Majesty the King of Great Britain, Ireland and the British Dominions beyond the Seas, Emperor of India:
For Great Britain and Northern Ireland:
The Honourable Sir Patrick William Maule Ramsay, K.C.M.G., His Majesty’s Envoy Extraordinary and Minister Plenipotentiary at Budapest;
His Serene Highness the Regent of the Kingdom of Hungary: M. Kálmán Kánya de Kánya, Royal Hungarian Minister for Foreign Affairs.
Article 17 states that the Convention does not apply ipso facto to all parts of what was then known as the British Empire and that Article and Article 18 provide a mechanism for extending its application to parts of the British Empire other than the United Kingdom.
The Convention was ratified by exchange of notes at London on 7 May, 1936. It was extended to Canada in accordance with Articles 17 and 18 by notification effected by exchange of notes dated 1 and 23 March, 1939, and entered into force for Canada on 1 April, 1939. It was suspended during World War II; presumably because the Kingdom of Hungary was then considered an enemy state. Since new letters patent constituting the Governor General of Canada were not issued by the Head of State of the United Kingdom until 1947, ratification and implementation were done by the United Kingdom. In 1948 Canada notified Hungary of the revival of the Convention. See A. E. Gotlieb, Canadian Treaty-Making (Toronto: Butterworths, 1968) at pages 39, 81. The evidence before the Motions Judge and before us is that the Convention is still in force in Canada and in Hungary.
An examination of the Convention discloses that its purpose is to facilitate civil and commercial proceedings pending in courts of the contracting states. It does not alter the municipal law of any contracting state. Hence in Canadian practice its validity or its effectiveness does not depend upon due implementation by statute. See P. W. Hogg, Constitutional Law of Canada, vol. 1, 3d ed. (Scarborough: Carswell, 1992) at pages 11-4 to 11-6; H. M. Kindred et al., International Law Chiefly as Interpreted and Applied in Canada, 5th ed. (Toronto: Emond Montgomery Publications Ltd., 1993); Abitibi-Price Sales Corp. v. Wilhelm Wesch (The), [1987] 2 F.C 579 (T.D.). The Motions Judge was therefore wrong to require evidence of an Act of Parliament implementing the Convention.
Part III of the Convention describes the procedure for the “Taking of Evidence”. Articles 7, 8 and 9 are in the following terms:
III.—Taking of Evidence
Article 7
(a) When a judicial authority in the territory of one of the High Contracting Parties requires that evidence should be taken in the territory of the other High Contracting Party, such evidence may be taken, in any one of the ways prescribed in Articles 8 or 9, in cases where these articles are applicable.
(b) In Part III of this Convention, the expressions—
(1) “taking of evidence” shall be deemed to include the taking of the statements of a plaintiff, defendant, expert or any other person on oath or otherwise; the submission to a plaintiff, defendant, expert or any other person of any oath with regard to any legal proceedings; and the production, identification and examination of documents, samples or other objects;
(2) “witness” shall be deemed to include any person from whom any evidence, as defined above, is required to be taken;
(3) “country of origin” shall be deemed to mean the country by whose judicial authority the evidence is required, and “country of execution” the country in which the evidence is to be taken. [Emphasis added.]
Article 8
(a) The judicial authority of the country of origin may, in accordance with the provisions of the law of his country, address himself by means of a Letter of Request to the competent authority of the country of execution, requesting such authority to take the evidence.
(b) The Letter of Request shall be drawn up in the language of the country of execution, or be accompanied by a translation into such language. Such translation shall be certified as correct by a Diplomatic or Consular Officer acting for the country of origin or by an official or sworn translator of the country of execution or of the country of origin. The Letter of Request shall state the nature of the proceedings for which the evidence is required, giving all necessary information in regard thereto, the names of the parties thereto, and the names, descriptions and addresses of the witnesses. They shall also either (1) be accompanied by a list of interrogatories to be put to the witness or witnesses, or, as the case may be, by a description of the documents, samples or other objects to be produced, identified or examined, and a translation thereof, certified as correct in the manner heretofore provided; or (2) shall request the competent authority to allow such questions to be asked viva voce as the parties or their representatives shall desire to ask.
(c) Letters of Request shall be transmitted—
In England by a Hungarian Diplomatic or Consular Officer to the Senior Master of the Supreme Court of Judicature.
In Hungary by a British Diplomatic or Consular Officer to the Royal Hungarian Ministry of Justice.
In case the authority to whom any Letter of Request is transmitted is not competent to execute it, such authority shall (except in cases where execution is refused in accordance with paragraph (f) of this Article) of his own motion forward the Letter of Request to the competent authority of the country of execution.
(d) The competent authority of the country of execution shall give effect to the Letter of Request and obtain the evidence required by the use of the same compulsory measures and the same procedure as are employed in the execution of a commission or order emanating from the authorities of his own country, except that if a wish that some special procedure should be followed is expressed in the Letter of Request, such special procedure shall be followed in so far as it is not incompatible with the law of the country of execution.
(e) The Diplomatic or Consular Officer, by whom the Letter of Request is transmitted, shall, if he so desires, be informed of the date when and the place where the proceedings will take place, in order that he may inform the interested party or parties, who shall be permitted to be present in person or to be represented, if they so desire, by any legal representatives who are competent to appear before the courts of the country of execution.
(f) The execution of a Letter of Request which complies with the preceding provisions of this Article can only be refused—
(1) If the authenticity of the Letter of Request is not established;
(2) If, in the country of execution, the execution of the Letter of Request in question does not fall within the functions of the judiciary;
(3) If the High Contracting Party in whose territory it is to be executed considers that his sovereignty or safety would be compromised thereby.
(g) In every instance where a Letter of Request is not executed by the authority to whom it is addressed, the latter will at once inform the Diplomatic or Consular Officer by whom it was transmitted, stating the grounds on which the execution of the Letter of Request has been refused, or the competent authority to whom it has been forwarded.
(h) When a Letter of Request has been executed, the competent authority to whom it was transmitted or forwarded shall send to the Diplomatic or Consular Officer by whom it was transmitted the necessary documents establishing its execution.
Article 9
(a) The evidence may also be taken, without any request to or the intervention of the authorities of the country of execution by a Diplomatic or Consular Officer acting for the country of origin.
(b) The Diplomatic or Consular Officer may request the individuals named by the court of the country of origin to appear before him and to give evidence. He may take all kinds of evidence which are not contrary to the law of the country of execution. The attendance and giving of evidence before such officer shall be entirely voluntary and no measures of compulsion shall be employed.
(c) The evidence may be taken in accordance with the procedure recognized by the law of the country of origin, and the parties will have the right to be present in person or to be represented by any legal representatives who are competent to appear before the courts either of the country of origin or of the country of execution.
(d) Unless and until a notification is given through the Diplomatic channel by the Hungarian Government, the provisions of this article will not apply to the taking of evidence from persons who are subjects or citizens of the High Contracting Party in whose territory the evidence is to be taken.
In making their request, the appellants say that they wish to examine the eight assignors/inventors for two reasons; first, to obtain from them information to enable them to prepare the case they are required to meet and, secondly, to obtain statements for impeachment purposes in the event that any inventor is called as a witness for the respondent at trial. They rightly concede that subsection 494(9) [as am. by SOR/90-846, s. 21] of the Rules prevents them from using any evidence they obtain from these witnesses to prove a fact in issue at trial since the witnesses are not parties to the action. But this does not prevent its admissibility for credibility purposes where section 10 [as am. by S.C. 1994, c. 44, s. 86] of the Canada Evidence Act is engaged. They invite us to construe the Convention liberally in order to give effect to its true purpose and intent, namely, to facilitate legal proceedings in both contracting states. They submit that when the Convention is construed in this way the examination of the assignors/ inventors for discovery comes within the definition of “taking of evidence” in Article 7 of the Convention.
The invitation has respectable provenance and I accept it. The dictum of Dickson J., as he then was, in Zingre v. The Queen et al., [1981] 2 S.C.R. 392, at pages 409-410, although written in a different context, describes aptly the interpretative approach that should guide us:
The argument in favour of granting the order in the case at bar does not rest merely on the notion of “comity”. It rests on treaty. In responding affirmatively to the request which has been made the Court will be recognizing and giving effect to a duty to which Canada is subject, by treaty, under international law. It is common ground that the treaty applies. None of the cases cited by the appellants involves a situation where Canada is under obligation to provide assistance to foreign authorities. It is the duty of the Court, in interpreting the 1880 Treaty and s. 43 of the Canada Evidence Act to give them a fair and liberal interpretation with a view to fulfilling Canada’s international obligations. Canada forced Switzerland to undertake criminal proceedings because Canada was unable to extradite the appellants from Switzerland. Now, Switzerland is asking Canada for assistance in those proceedings. The Treaty of 1880 places Canada under a specific obligation to comply with the Swiss request. If Canada denies the Swiss request it will be in breach of its international obligations. By the terms of the Treaty, orders for commission evidence, as requested by the Swiss, are part and parcel of the surrogate criminal proceedings in Switzerland. It must be assumed in the absence of evidence to the contrary that the request has been made in compliance with the Treaty, in conformity with Swiss rules and practice, and “with a view to the better administration of justice, and to the prevention of crime”, the purpose for which the Treaty, as expressly stated herein, was entered into.
In that case the issue before the Court was whether Canada should honour a Letter of Request from a Swiss court to take evidence for use at the investigative stage of criminal proceedings pending in Switzerland.
See also J.-G. Castel, Canadian Conflict of Laws, 3rd ed. (Toronto: Butterworths, 1994), at page 128 and B. J. Freedman and G. N. Harney, “Obtaining Evidence from Canada: The Enforcement of Letters Rogatory by Canadian Courts” (1987), 21 U.B.C. L. Rev. 351.
In light of the evidence and these authorities I am of the view that the appellants had made their case for the issue of the order for the examination of the eight assignors/inventors in Budapest and the issue of a Letter of Request. The Motions Judge declined to exercise his discretion because of the error to which I have referred. In my respectful view, the justice of this case requires the making of such an order.
For all the foregoing reasons, I would allow the appeal with costs both here and below, set aside the order of the Motions Judge and would order that the appellants are at liberty to examine for discovery the following eight persons: Peter Bod, Kalman Harsanyi, Bela Hegedus, Erik Bogsch, Eva Fekecs, Peter Imre, Zsuzsanna Aracs née Trischler and Sandor Miszori, all resident in Hungary, as assignors of Canadian Patent 1,265,809, at a date and time agreed upon by the parties or appointed by this Court, at a place to be decided by the Central District Court of Pest, Hungary; and further, that the appellants do submit to this Court for issue a Letter of Request that complies with Article 8 of the Convention and is directed to the Central District Court of Pest requesting its assistance in the execution of this order.
I would not wish to leave this appeal without making some observations on the explanation that the Motions Judge gave for the delay in rendering his decision. The materials before him disclosed that the parties had arranged to conduct the examinations for discovery during the week of 12 to 16 September 1994, inclusive. The motion was returnable on 23 August 1994 and was heard on that day. On 28 November 1994, some three months after the motion was argued and two months after the date fixed for discoveries, the Motions Judge made his order dismissing the appellants’ motion.
He explained the delay between hearing and disposition in the following passage in his reasons [at page 232]:
Due to various circumstances, this judge has been unable to formulate this disposition of the defendants’ motion within the time period which was expected by them. However in light of this disposition, and the time which would have been needed to bring on an appeal hearing, that delay beyond the expected time will not turn out to be so inconvenient as it might otherwise have been.
From the materials filed in support of the motion it is clear to me that counsel for the parties had been attempting between May and August 1994 to settle the issues in dispute without judicial intervention and that the motion was brought only when those attempts failed. Given this background and the fact that the examinations for discovery had been scheduled to commence within three weeks after the hearing of the motion, the parties were entitled to expect that the Court would make every effort to accommodate them. In light of the explanation he gave, the Motions Judge was obviously of a different view; otherwise he would have disposed of the motion earlier as the parties had every right to expect. Save in exceptional circumstances, every judge has an obligation to dispose of all matters heard by him or her within a reasonable time after hearing. What is reasonable will depend, of course, on the circumstances of each case, including, where known, the steps that the parties have agreed to take following disposition. I make these observations here to emphasize that timely disposition of matters adjudicated is an important feature of the administration of justice to which all litigants are entitled and which should not be overlooked.
Stone J.A.: I agree.
Robertson J.A.: I agree.