T-4780-76
Canamerican Auto Lease & Rental Limited
(carrying on business under the firm name and
style of "Hertz") and Hertz Canada Limited
(carrying on business under the firm name and
style of "Hertz") (Plaintiffs) (Respondents)
v.
The Queen (Defendant) (Applicant)
Trial Division, Dubé J.— Montreal, June 18;
Ottawa, June 20, 1984.
Practice — Application pursuant to R. 480 for order action
proceed to trial as to liability and issue of damages be subject
of reference — Case concerning tenders for car rental services
at international airports — Plaintiffs objecting to reference
due to advanced stage of preparations and expenses on dam
ages issue, and possible duplication of evidence — Motion
denied — Purpose of R. 480 to minimize expense of action —
Absent consent of both parties, reference not to be imposed
where plaintiff objecting unless reasonably certain reference
resulting in economy of time and costs — Federal Court
Rules, C.R.C., c. 663, R. 480.
CASES JUDICIALLY CONSIDERED
REFERRED TO:
Brouwer Turf Equipment Ltd. v. A and M Sod Supply
Ltd., [1977] 1 F.C. 51 (C.A.); Baxter Travenol
Laboratories of Canada, Ltd. v. Cutter Ltd., [1982] 1
F.C. 388 (T.D.).
COUNSEL:
Raymond D. LeMoyne for plaintiffs (respond-
ents).
Donald J. Rennie for defendant (applicant).
SOLICITORS:
Doheny Mackenzie, Montreal, for plaintiffs
(respondents).
Deputy Attorney General of Canada for
defendant (applicant).
The following are the reasons for order ren
dered in English by
DUBÉ J.: This application is by the defendant
for an order pursuant to Rule 480 [Federal Court
Rules, C.R.C., c. 663] directing that the plaintiffs'
action proceed to trial on the issue of liability
alone and that the issue of damages be the subject
of reference.
Essentially, the plaintiffs claim in their action
that in calling and awarding tenders for automo
bile rental services at the nine major international
airports in Canada in 1976 the Ministry of Trans
port did not adhere to representations made prior
to the tender call, with the result that a competitor
(Avis Rent a Car) of the plaintiffs did not lose its
positions, thus depriving the plaintiffs of
$5,000,000 dollars in profits.
The action was commenced in December 1976.
Numerous interlocutory proceedings have fol
lowed. Much effort was devoted to the discovery of
documents and other evidence relating more to the
issue of damages than to liability. The defendant
claims that because of the extensive preparations
remaining to be carried out with reference to
damages the case is still far from ready for trial.
At trial, the defendant intends to call five wit
nesses, four of whom would be experts required to
address the issue of quantum. She therefore claims
that it would be beneficial to both parties to sever
the two issues: the date for trial could be
advanced, the issue of liability could be resolved
and the matter of damages may become unneces
sary.
The true purpose of Rule 480 is to minimize the
expense of an action.' The Court must determine
whether or not it would be more economical to
deal first with liability and then with damages if
necessary. It is often difficult to anticipate whether
a reference is likely to shorten a case, or may cause
two trials and perhaps two sets of appeals. I should
think that in the absence of the consent of both
parties, a motion judge ought not to impose a
reference on a case, specially where the plaintiff
strenuously objects to the splitting of his action,
unless it appears reasonably certain that a refer
ence will indeed result in an economy of time and
' See Jackett C.J. in Brouwer Turf Equipment Ltd. v. A and
M Sod Supply Ltd., [1977] 1 F.C. 51 (C.A.), at p. 54.
costs. In the absence of consent, there must be a
"present reason, bearing on the conduct of the
action as a whole" for ordering a reference. 2
The plaintiffs are resisting the reference in the
instant case on several valid grounds which, for
convenience, I am grouping under three separate
propositions.
Firstly, the case has already been going on for
almost eight years. Should a trial intervene on the
issue of liability alone, and there be a successful
appeal from such findings, a reference on damages
might well not be heard for a number of years.
One witness has already died. Several others no
longer work for the corporate group of which the
plaintiffs form part. And, obviously, the memory
of the survivors does not improve with the passage
of time.
Secondly, the nature of the case is such that in
order to establish the liability of the defendant, the
plaintiffs will have, in any event, to show that by
reason of the market then prevailing in the car
rental industry, they would have captured a share
of the business of Avis Rent a Car. In order to
establish such a link of causality, the plaintiffs
allege that they must adduce evidence of market
ing, sales and advertising realities during the rele
vant period of 1976 to 1979, as well as expert
evidence, which would be of exactly the same
nature as some of the evidence required to prove
the quantum. Some, if not all, of the same wit
nesses would have to testify twice. With a refer
ence, the plaintiffs would have to shoulder the
additional burden of seeking to separate the evi
dence of such witnesses in two components or
going over the same ground twice.
Thirdly, the time and costs involved in extensive
discovery and production of documents in connec
tion with the quantum of damages have already
2 See Mahoney J. in Baxter Travenol Laboratories of
Canada, Ltd. v. Cutter Ltd., [1982] 1 F.C. 388 (T.D.), at p.
390.
been invested by the parties: it is now very late in
the day to sever the issue of quantum from that of
liability.
Under the circumstances, looking at the conduct
of the action as a whole, considering the potential
prejudice to the plaintiffs, the possible duplication
of evidence and the advanced stage of preparations
and expenses on damages, it does not appear to me
to be proper and reasonable to impose a reference
upon the plaintiffs against their will.
ORDER
Motion denied. Costs in the cause.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.