Law Times

July 22, 2013

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Page 13 Law Times • July 22, 2013 caselaw CaseLaw is a weekly summary of notable civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada, and all Ontario courts. FEDERAL COURT OF APPEAL Civil Procedure SUMMARY JUDGMENT Record on motion did not provide basis for resolving ambiguity This was appeal of dismissal of actions. Appellant brought actions against respondents for copyright infringement. Respondents brought motion for summary judgment dismissing both actions. At issue was whether appellant had standing to sue respondents under Copyright Act (Can.), for certain acts they undertook between June 2001 and March 2007, in respect of CHS works. Judge granted motion and dismissed actions. Appeal allowed. Appellant was entitled to sue in its own name for breach of copyright in CHS works if it had right, title or interest in Crown's copyright by virtue of licence. There was ambiguity in licence. It was unclear whether appellant was licensed only to use CHS data to make its digital products or whether it was licensed to make digital copies of CHS works. Record on motion did not provide basis for resolving ambiguity. Respondents had not met burden of proving that there was no genuine issue for trial. Motion for summary judgment should have been dismissed. Nautical Data International Inc. v. C-Map USA Inc. (Mar. 1, 2013, F.C.A., M. Nadon J.A., K. Sharlow J.A., and Eleanor R. Dawson J.A., File No. A-115-12, A-11612) 226 A.C.W.S. (3d) 1140. Industrial and Intellectual Property PATENTS Phrase "previously approved" should be strictly construed This was appeal of judge's decision granting application for judicial review. Appellant Minister of Health refused to register respondent's drug THALOMID on register of innovative drugs. Medicinal ingredient in THALOMID was thalidomide. In 1960 and 1961, two companies received approval for sale of drug, including thalidomide under brand names KEVADON and TALIMOL. In 1961 and 1962, thalidomide was dramatically withdrawn from world market because of its potential to produce fetal malformation. In 1962, sale of thalidomide was absolutely prohibited. However, thalidomide was found to be effective treatment of leprosy and related conditions and form of cancer. THALOMID was first available in 1995 through program that was designed to pro- vide exceptional access to drugs not approved for sale in Canada. Respondent applied for notice of compliance, which was issued in August 2010. Minister advised respondent that THALOMID would not be eligible for data protection pursuant to Food and Drug Regulations (Can.), because its medicinal ingredient thalidomide had been previously approved by Minister in at least two drugs, KEVADON and TALIMOL. Minister confirmed decision not to list respondent's product on innovative drugs register. Respondent applied for judicial review. Judge determined that prior approval of KEVADON and TALIMOL should not stand in way of data protection for THALOMID. Judge found that approval of thalidomide was short lived, that thalidomide was banned until respondent came up with new drug submissions for THALOMID and that notice of compliance was granted based on new studies and data. Appeal allowed. THALOMID was new drug and Minister's approval must be obtained before it could be sold in Canada. Thalidomide was medicinal ingredient previously approved in drug by Minister. "Previously" should not be construed as meaning "currently". Reading words "and currently" into data protection provisions could open door to unintended scenarios. Phrase "previously approved" should be strictly construed. Courts should not inquire into why notice of compliance was suspended or withdrawn. Although thalidomide had exceptional history, there was no cogent legal basis to create exception. Celgene Inc. v. Canada (Minister of Health) (Feb. 15, 2013, F.C.A., Johanne Gauthier J.A., K. Sharlow J.A., and M. Nadon J.A., File No. A-75-12) Decision at 212 A.C.W.S. (3d) 814 was reversed. 226 A.C.W.S. (3d) 1144. FEDERAL COURT Immigration REFUGEE STATUS Board procedurally unfair in not alerting applicant to photographic inconsistencies Applicant was denied refugee status. Board could not determine applicant's personal identity. Board was concerned that photograph contained in applicant's RIC did not depict applicant. Board found authenticity of documents questionable. Board found applicant failed to produce sufficient credible documents and evidence to establish applicant's identity as national of China and did not satisfactorily These cases may be found online in BestCase and other electronic resources from Canada Law Book. To subscribe, please call 1-800-387-5164. explain why they were not provided. Board found applicant knowingly submitted false documents and was not credible. Application for judicial review was allowed. Decision was procedurally unfair. Board was procedurally unfair in not alerting applicant prior to hearing applicant's photographic inconsistencies would be issue with respect to confirming applicant's identity. Board failed to disclose prior to hearing that blown-up copies of applicant's photographs would be put to applicant to question applicant's identity. Board did not err in failing to analyze applicant's nationality independent of identity finding. Xiang v. Canada (Minister of Citizenship and Immigration) (Mar. 8, 2013, F.C., Michael D. Manson J., File No. IMM-5710-12) 226 A.C.W.S. (3d) 1134. Taxation INCOME TAX Decision letter's conclusion equivocal and inconsistent with evidence Application for judicial review of decision of Canada Revenue Agency (CRA). Applicant paid president management bonus of $7.09 million on February 28, 2006. President was informed on March 13, 2006 that corporation was obliged to withhold and remit full amount of tax due on payment of bonus on or before March 15, 2006. Applicant remitted payroll taxes of $2.8 million on account of payment of bonus. CRA assessed corporation $284,805 late remitting penalty. CRA determined that applicant ought to have remitted amount on March 3, 2006, and failure to remit proper amount on this date warranted assessment of penalty. Required withholding was later lowered to $1.5 million and penalty was reduced to $150,748. CRA offset penalty with GST refunds owed to applicant. Applicant's request for cancellation of penalty under taxpayer relief provisions in s. 220(3.1) of Income Tax Act (Can.), was denied. Application granted. Decision was quashed. Applicant made error in failing to remit payroll taxes by March 3, 2006, but corrected error by payment 11 days later. Decision letter from CRA made no indication why applicant's correction of error was not quick enough to satisfy director, nor did it state how error could have been remedied any quicker. Applicant would not have known correct and final amount owed on penalty until after deduction was made. Decision letter's conclusion was equivocal and inconsistent with evidence before director. Director's decision that applicant failed to quickly edy error was found to be unreasonable as it failed requirements of being justified, transparent and intelligible. Matter was returned for re-determination. NRT Technology Corp v. Canada (Attorney General) (Feb. 27, 2013, F.C., Leonard S. Mandamin J., File No. T-56-08) 226 A.C.W.S. (3d) 1204. ONTARIO CIVIL CASES Appeal LEAVE TO APPEAL Failure to cite correct test for summary judgment sufficient to doubt correctness of decision This was motion for leave to appeal dismissal of motion for summary judgment. Plaintiffs' action arose from deaths of two victims in collision following high speed vehicle chase by officers of police service. Plaintiffs alleged that police officers were negligent. They alleged that defendants Ontario, Quebec and Canada were vicariously liable, as employers of police officers and owners of police cruisers. Ontario and Quebec brought motions for summary judgment. Motions were dismissed. Motions judge found that determination of vicarious liability would more appropriately be considered with full evidentiary record. Motions judge held that it could not be concluded that plaintiffs' position was clearly untenable and that interests of justice required trial. Plaintiffs' motion to further amend pleadings was granted. Leave to appeal granted. Motions judge applied test for motion to strike out claim instead of test for summary judgment, which put decision in conflict with leading decision of Court of Appeal. Motions judge's review of evidentiary record was problematic. Decision appeared to be in conflict with case law that required responding party to put best evidentiary foot forward. Failure to cite correct test for summary judgment was sufficient to doubt correctness of decision. Motions judge's review of evidentiary record was problematic and provided additional reason to doubt correctness of decision. With respect to decision to allow amendment, motions judge's decision conflicted with decision of Supreme Court of Canada. There was good reason to doubt correctness of decision. Kassian Estate v. Canada (Attorney General) (Feb. 14, 2013, Ont. S.C.J., Robert N. Beaudoin J., File No. Ottawa 10-47481) Leave to appeal from 222 A.C.W.S. (3d) 906 was allowed. 226 A.C.W.S. (3d) 923. Contracts PERFORMANCE AND BREACH Alleged misrepresentations did not justify non-performance of contract Defendants purchased plaintiff 's real estate brokerage pursuant to share purchase agreement. Defendant guaranteed purchase price by unconditional promissory note. Defendant stopped payments. Plaintiff brought action to enforce promissory note and for non-payment of balance of purchase price. Defendants alleged misrepresentation and breaches of agreement in negotiations and disclosure. Defendants claimed damages. Plaintiff was entitled to payment of $372,514 pursuant to promissory note. Counterclaim was dismissed. No misrepresentations were made to defendants to induce individual to enter into agreement. No reliance was placed on any representations in entering agreement. Only term plaintiff breached was failure to deliver audited financial statements, which was not material and caused defendants no damages because defendants waived them and affirmed contract. Alleged misrepresentations were without foundation and did not justify defendant's non-performance of contract and did not support claim for damages. Henderson v. Risi (Feb. 20, 2013, Ont. S.C.J., Lederman J., File No. CV-09-393431) 226 A.C.W.S. (3d) 1172. Courts ABUSE OF PROCESS Plaintiff did little more than oppress and harass his opponents Motion by defendants to dismiss plaintiffs' action and to have individual plaintiff declared vexatious litigant. Primary claim in action was for declaration that corporate plaintiff was owner of property. This was identical to relief sought in 1998 action which was dismissed, and was strikingly similar to relief that same individual plaintiff, together with his mother and related entities, unsuccessfully sought in numerous other proceedings. Actions arose out of death of father of individual plaintiff. Father left most of his substantial estate to daughter, to exclusion of individual plaintiff and his mother. Pursuant to previous court orders and judgments, property was ordered sold. Estate was finalized by passing of accounts in 2009. Motions granted. Action dismissed for reasons of issue estoppel, abuse of process, missed court-ordered time-limit and expired limitation period. Title to property belonged to two defendants who purchased property for value

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