Date: 19980310
Docket: T-733-96
BETWEEN:
PRINCE EDWARD ISLAND
MUTUAL INSURANCE COMPANY
Plaintiff and
Defendant by Counterclaim
AND
THE INSURANCE COMPANY OF
PRINCE EDWARD ISLAND
Defendant and
Plaintiff by Counterclaim
REASONS FOR ORDER
RICHARD MORNEAU, ESQ., PROTHONOTARY
[1] This is a motion by the Defendant and Plaintiff by Counterclaim (the Company) directed to outstanding questions from the examination for discovery of the representative of the Plaintiff and Defendant by Counterclaim (Mutual).
[2] This motion takes place in the context of a trade-names and trade-marks passing off action involving two corporations doing business in the field of insurance services to the public in the Province of Prince Edward Island, and allegedly outside that province in the case of Mutual.
[3] The outstanding questions consist of forty-two (42) questions (the number of questions outstanding at the beginning of the hearing of the motion at bar) classified in ten categories.
[4] I shall attempt to adjudicate on this motion by referring to each category and by avoiding where possible specific references to individual questions within each category.
[5] During the hearing of the motion, counsel for the Company withdrew certain questions. Therefore, the withdrawn questions shall not be referred to herein and shall not be adjudicated.
[6] Before dealing with the various categories, it is necessary to have some understanding of the background and the issues at stake.
Background and Issues
[7] Mutual alleges that, since 1885, it has made use of various corporate names as trade-names and trade-marks in the provision of insurance services in the Province of Prince Edward Island as well as outside the province. Mutual alleges that it has provided these insurance services in association with a trade-name including the words "Prince Edward Island", "Mutual" and "Insurance Company" thereby establishing for Mutual a substantial reputation and goodwill in Canada
[8] In support of its passing-off action under the Trade-marks Act, R.S., 1985, c. T-13, Mutual asserts the following, at paragraph 13 of its Amended Statement of Claim:
| 13. The Defendant has, by reason of its use of the trade-name and trade-mark THE INSURANCE COMPANY OF PRINCE EDWARD ISLAND: |
| (a) directed public attention to its insurance services in such a way as to cause or be likely to cause confusion in Canada between the services of the Defendant and the services of the Plaintiff, contrary to Section 7(b) of the Trade-Marks Act; |
| (b) misappropriated the goodwill and reputation connected with the Plaintiff's trade-name, contrary to Section 7(b) of the Trade-Marks Act; and |
| (c) passed off its insurance services as and for the services of the Plaintiff, contrary to Section 7(c) of the Trade-Marks Act. |
| (underlining omitted) |
[9] In defence, the Company asserts that Mutual has used and abandoned a profusion of different trade-names throughout its existence. As to Mutual's current corporate name, the Company maintains that if that name was used at all, it would have been as a trade-name, not as a trade-mark. Furthermore, the use by Mutual of its current name would have started only in 1994 - when Mutual was granted its present name by the legislature of the Province of Prince Edward Island - and would have been restricted to that province.
[10] The Company further contends that Mutual would have adopted an umbrella design said to be similar to that of a trade-mark owned by a U.S. corporation, Travelers Corporation. Accordingly, Mutual would come to this Court seeking equitable relief with a lack of clean hands.
[11] In answer to Mutual's allegation that certain aspects of the Company's business are in direct competition with Mutual's business, the Company replies that Mutual benefits from certain favourable tax treatment not available to the Company and that Mutual does not offer automobile insurance which is one of the Company's main products and services.
[12] The Company also attacks the vires of section 7 of the Trade-marks Act or, alternatively, the jurisdiction of this Court to grant Mutual any relief in respect thereof on the assumption that the dispute between the parties involves solely corporate or trade-names and not trade-marks.
The Law on Questions on Discovery
[13] As stated by MacKay J. in Sydney Steel Corp. v. Omisalj (The), (1992) 2 F.C. 193, at page 197:
| (...) [T]he standard for propriety of a question asked in discovery (...) is whether the information solicited by a question may be relevant to the matters which at the discovery stage are in issue on the basis of pleadings filed by the parties. |
[14] Despite this broad statement of principle, though, there are some limits on the ambit of an examination for discovery, one of which is that far-reaching questions in the nature of a fishing expedition are to be discouraged (see Reading & Bates Construction Co. v. Baker Energy Resources Corp. (1988), 24 C.P.R. (3d) 66 (F.C.T.D.), at page 72).
[15] With this in mind, I shall now evaluate the propriety of the questions and documents requested.
Category 1
[16] This category deals with Mutual's corporate and trade-name history. Considering that Mutual changed name several times in the past, that history might have been relevant had it been limited to a reasonable time period. However, the questions request information covering the period since 1885. This information would not be relevant to any material date alleged by the parties in these pleadings. In addition, I am of the view that any probative value which the information sought may offer is by far outweighed by the time and trouble it would take to provide answers. Therefore, no questions need to be answered in category 1.
Category 2
[17] Some questions under this category intend to probe Mutual's marketing activities through a registered trade-name referred to as PEI Direct. However, it must be noted that Mutual is not suing on the basis of that name. In addition, it would appear that the use of that trade-name by Mutual is prospective only. Therefore, I conclude that questions 137, 250, 251 and 252 are hypothetical in nature and irrelevant to the issues in dispute. They will not be ordered answered.
[18] Question 234 requires Mutual to produce copies of contracts it might have with each of its current insurance sales agents. It is argued that this question is put to discover what instructions might be given by Mutual with respect to how its different trade-names are to be used. I believe that this is an appropriate avenue of inquiry. Therefore, question 234 must be answered.
Category 3
[19] This category addresses Mutual's financial statements. The only question remaining under this category is question 577. The Court shall take note of counsel for Mutual's undertaking to answer it should the material submitted with respect to question 68 prove to be insufficient to answer question 577 as well.
Category 4
[20] This category deals with the nature of the different types of insurance products offered by Mutual and the impact of the tax benefit enjoyed by Mutual on these products.
[21] I agree with counsel for the Company that these issues may be relevant to listed surrounding circumstances in an analysis of confusion under subsection 6(5) of the Act. Therefore all questions under this category shall be answered.
Category 5
[22] The issue emphasized in this category is Mutual's alleged use of a third party umbrella logo, namely the Travelers Corporation's logo. It relates to two paragraphs found in the Company's Amended Defence and Counterclaim. I do not believe that the Company should be allowed to pursue questions 947 and 948 even though, by an order of even date, I denied a motion by Mutual to have these two paragraphs struck out. These questions purport to discover whether Mutual and Travelers sued one another over the use of the similar umbrella logos. The answers to these questions are irrelevant to the issues in dispute between Mutual and the Company. Questions 947 and 948 need not be answered.
[23] Question 950 requests Mutual to come to a conclusion as to the possibility of confusion arising between Travelers' and Mutual's umbrella logos. This question calls for a legal determination which is within the purview of the Court, not of Mutual's representative. This question need not be answered.
Category 6
[24] This category addresses Mutual's 1994 change of name. The questions asked refer to discussions or communications held by two employees of Mutual further to a letter from the Office of the Superintendent of Insurance for the Province of Prince Edward Island. I understand, though, that these employees would be in-house lawyers for Mutual. Counsel for Mutual is concerned with the possibility of a solicitor-client privilege since the discussions or communications referred to might very well have been carried on by the two employees in their capacity as lawyers.
[25] The questions asked appear to be relevant to the issues raised in paragraph 15 of Mutual's Amended Statement of Claim and in paragraph 20 of the Company's Amended Statement of Defence and Counterclaim. However, so far the basis for asserting that privilege has not been clearly established.
[26] Therefore, Mutual shall answer the questions in this category unless a proper claim for solicitor-client privilege is made by Mutual, the propriety of which shall be determined at a later date.
Category 7
[27] With respect to the only question under this category, the Court takes note that Mutual has provided an answer or will be providing one in writing.
Category 8
[28] All questions in this category were withdrawn. No adjudication is therefore needed.
Category 9
[29] All questions under this category, save question 109, pertain to the constitutional and jurisdictional issues raised by the Company in its Defence. They are all framed alike. For example, question 42 reads as follows:
| Provide examples of how the name "Prince Edward Island Mutual Insurance Company" is used outside of Prince Edward Island as a trade-mark. |
[30] Mutual objects to answering these questions on the basis that they ask the witness to make a legal determination of what a "trade-mark" or a "trade-name" is. It is submitted that these are questions of law and are therefore improper.
[31] However, it is Mutual which raises in its Amended Statement of Claim that it makes use of its corporate name as a trade-name and trade-mark. Therefore, the Company is entitled to discover how in fact such would be the case. Even though question 42 might require an expression of opinion by the witness as it contains a qualifier at the end, I am of the view that question 42 and the questions framed alike are essentially geared to discover facts. In Foseco Trading A.G. v. Canadian Ferro Hot Metal Specialties, Ltd. (1991), 36 C.P.R. (3d) 35, Madame Justice Reed had to evaluate the propriety of a question where the information sought was factual as well as technical in nature, not factual as well as legal in nature as in our present case. Nevertheless, I believe that the principle she found to be applicable there (page 52) can be applied here:
| I have not been able to find, however, an articulation of the appropriate principle, in a case such as the present, where the information sought is technical in nature (and for that reason might be addressed in an affidavit of an expert witness), but is within the common knowledge of the plaintiff and where the question is of a factual nature although it can arguably be said to require an expression of opinion by the witness, in the sense that many assertions of "fact" require the expression of an "opinion". It is my conclusion that in such cases the principle to be applied is that the factual nature of the question takes precedence and the question should be answered. |
[32] Therefore, questions 36, 42, 44, 48 and 49 shall be answered.
[33] Question 109 reads as follows:
| Advise what evidence the Plaintiff has to rely on to show that the Plaintiff has goodwill outside of Prince Edward Island. |
[34] I agree with Mutual's counsel that this question asks the witness to choose facts and to disclose how his lawyer will prove his plea. Consequently, it amounts to an improper question and need not be answered.
Category 10
[35] All questions under this category were withdrawn. Therefore, no adjudication is required.
[36] An order will issue ordering Mutual to answer, in writing as requested by counsel for both parties, within fifteen (15) days from the date of the order, all the questions for which an answer is required according to the above reasons.
[37] The order will also require Blair Campbell, the representative of the Plaintiff and Defendant by Counterclaim previously examined for discovery, to re-attend, at the expense of the Plaintiff and Defendant by Counterclaim, upon a date, time and place to be agreed by counsel or, failing such agreement, on a date, time and place fixed by a direction to attend served by the Defendant and Plaintiff by Counterclaim, to answer all proper questions arising from the answers and documents provided under paragraph 36 above.
[38] As success is divided on this motion, costs will be in the cause.
Richard Morneau
Prothonotary
MONTREAL, QUEBEC
March 10, 1998
FEDERAL COURT OF CANADA
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT NO.:
STYLE OF CAUSE:
T-733-96
PRINCE EDWARD ISLAND MUTUAL
INSURANCE COMPANY
Plaintiff and
Defendant by Counterclaim
AND
THE INSURANCE COMPANY OF
PRINCE EDWARD ISLAND
Defendant and
Plaintiff by Counterclaim
PLACE OF HEARING:Ottawa, Ontario
DATE OF HEARING:January 27, 1998
REASONS FOR ORDER BY RICHARD MORNEAU, ESQ., PROTHONOTARY
DATE OF REASONS FOR ORDER:March 10, 1998
APPEARANCES:
Mr. Arthur B. Renaud for the Plaintiff and Defendant by
Counterclaim
Mr. R. Aaron Rubinoff and Mr. Howard P. Knopf for the Defendant and Plaintiff by
Counterclaim
SOLICITORS OF RECORD:
Mr. Arthur B. Renaud for the Plaintiff and Defendant by
Sim Hughes Ashton & McKay Counterclaim
Toronto, Ontario
Mr. R. Aaron Rubinoff and Mr. Howard P. Knopf for the Defendant and Plaintiff by
Perley-Robertson, Panet, Hill & McDougall Counterclaim
Ottawa, Ontario