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Date: 20010531 Docket: A-225-01 Neutral citation: 2001 FCA 172 CORAM: STONE J.A. DÉCARY J.A. SHARLOW J.A. BETWEEN: SYNCHRONICS LTD, SYNCHRONICS, IAN BROWN and MARCUS LEECH carrying on business as Synchronics Appellants and SYNCHRONICS, INCORPORATED Respondent Dealt with in writing without appearance of parties ORDER delivered at Ottawa, Ontario, May 31, 2001 REASONS FOR ORDER BY: SHARLOW J.A. CONCURRED IN BY: STONE J.A. DÉCARY J.A. Date: 20010531 Docket: A-225-01 Neutral citation: 2001 FCA 172 CORAM: STONE J.A. DÉCARY J.A. SHARLOW J.A. BETWEEN: SYNCHRONICS LTD, SYNCHRONICS, IAN BROWN and MARCUS LEECH carrying on business as Synchronics Appellants and SYNCHRONICS, INCORPORATED Respondent REASONS FOR ORDER SHARLOW J.A. In 1998, a corporation named Synchronics, Incorporated commenced Action No. T-2407-98 against defendants identified in the statement of claim as "Synchronics Ltd., Synchronics, Ian Brown and Marcus Leech carrying on business as Synchronics". A Defence and Counterclaim was submitted to the Registry but, for reasons that will become apparent, it was never accepted for filing. At various times in the proceedings involving this action, the named defendants have asserted that there is in fact no corporation called Synchronics Ltd. and that "Synchronics" is the name of a partnership of which Mr. Brown and Mr. Leech are members. For present purposes I will assume that to be the case, and I will ignore references to Synchronics Ltd. even though the style of cause has never been amended. In substance, the action was against the partnership known as Synchronics. Mr. Brown and Mr. Leech are named, not in their personal capacity, but in their capacity as partners of Synchronics. For convenience I will refer to the defendants collectively as the Synchronics partnership. The Synchronics partnership has attempted from the outset to defend the action without being represented by counsel. That brought into play Rule 120 of the Federal Court Rules, 1998, which reads as follows:
Soon after the statement of claim was filed, the Synchonics partnership sought an order authorizing either Mr. Brown or Mr. Leech to act for it, and an order permitting a joint Defence and Counterclaim. That motion was denied by Mr. Justice Teitelbaum on March 23, 1999 because it was not supported by an affidavit. On May 7, 1999 Mr. Justice Teitelbaum denied a motion by the Synchronics partnership to reconsider his March 23, 1999 order. On the same day, he dealt with a motion by Synchronics, Incorporated for default judgment. He gave the Synchonics partnership 15 days to retain counsel, failing which default judgment would be granted. The Synchonics partnership did not retain counsel within 15 days, and indeed to this day are unrepresented by counsel. On May 10, 1999, the Synchonics partnership filed a notice of appeal against all three orders of Mr. Justice Teitelbaum. Synchronics, Incorporated moved to quash the appeal. In an order made on June 15, 1999 and certified on June 21, 1999, the appeal was quashed on the basis that it was out of time in so far as it related to the order of Mr. Justice Teitelbaum dated March 23, 1999, and that, because that order could not be appealed, the appeals of the two May 7, 1999 orders that were predicated upon the March 23, 1999 order could not be maintained. The Synchonics partnership sought leave to appeal to the Supreme Court of Canada. Leave to appeal was denied on March 16, 2000. Leave to reconsider the denial of leave was dismissed on August 4, 2000. Meanwhile, on April 3, 2000, Mr. Justice Teitelbaum granted default judgment against the Synchonics partnership. The Synchonics partnership appealed that order and moved for leave to permit Mr. Brown and Mr. Leech to represent them in the appeal against the order for default judgment, and for a stay of the execution of the order for default judgment. Both motions were denied by me on May 31, 2000. The appeal was dismissed on June 19, 2000. The Synchonics partnership sought leave to appeal both orders to the Supreme Court of Canada. Leave was denied on March 1, 2001. On March 12, 2001, the Synchonics partnership moved for an order setting aside the April 3, 2001 order for default judgment. On March 28, 2001, that motion was denied by Mr. Justice Teitelbaum, who also awarded Synchronics, Incorporated costs of $1,500 payable forthwith. On April 9, 2001 the Synchonics partnership filed a notice of appeal challenging the March 28, 2001 order of Mr. Justice Teitelbaum. The notice of appeal indicates that the Synchronics partnership is still challenging the initial decision of March 23, 1999 denying leave to permit representation by Mr. Brown and Mr. Leech, and is also challenging on various grounds the legal validity of Rule 120. In addition, the notice of appeal alleges that the Court is unfairly biased against unrepresented litigants, and that the award of costs of $1,500 is punitive. Synchronics, Incorporated has moved for an order quashing the appeal filed on April 9, 2001. The basis for the motion is that the subject matter of the appeal is res judicata or alternatively is an improper attempt to prolong these proceedings and thus an abuse of the process of the Court. On April 30, 2001, the Synchonics partnership has filed a response to the motion to quash. In a letter to the Administrator of the Court dated May 2, 2001, Synchronics, Incorporated argues that the response dated April 30, 2001 should not have been accepted for filing because it was submitted by Mr. Brown and Mr. Leech, who are not authorized to represent the Synchronics partnership. There may well be merit to this argument, but as the response was in fact accepted for filing before Synchronics, Incorporated challenged the correctness of doing so, I have read the response and taken it into consideration in dealing with the motion to quash the appeal. I have concluded that the motion of Synchronics, Incorporated should be granted in part, on the basis that the notice of appeal raises issues that have already been determined in prior proceedings and thus are res judicata. The applicable principle is summarized in Thomas v. Trinidad and Tobago (Attorney General) (1990), 115 N.R. 313 (P.C.) at pp. 316-317, in a passage adopted by this Court at paragraph 36 of Canada v. Chevron Canada Resources Ltd., [1999] 1 F.C. 349 (C.A.): It is in the public interest that there should be finality to litigation and that no person should be subjected to action at the instance of the same individual more than once in relation to the same issue. The principle applies not only where the remedy sought and the grounds therefor are the same in the second action as in the first but also where, the subject matter of the two actions being the same, it is sought to raise in the second action matters of fact or law directly related to the subject matter which could have been but were not raised in the first action. The classic statement on the subject is contained in the following passage from the judgment of Wigram, V.C., in Henderson v. Henderson (1843), 3 Hare 100, at page 115: ". . . where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time." The same reasoning applies to appeals. Here, the Synchronics partnership clearly wished from the outset to have an order made under Rule 120 to permit representation by Mr. Brown and Mr. Leech, but the attempt to obtain such an order was denied by Mr. Justice Teitelbaum on March 23, 1999. That order could have been appealed if the appeal had been commenced on a timely basis, or if an extension of time to appeal had been sought and obtained. Any argument challenging the legal validity of Rule 120 or its application to this case could and should have been raised in the initial motion before Mr. Justice Teitelbaum that resulted in the March 23, 1999 order or at least in the appeal from that order. However, I see no basis in law for barring the Synchronics partnership from proceeding with the appeal against the award of costs. Therefore, the appeal should be dismissed except with respect to the award of costs made by Mr. Justice Teitelbaum in his order dated March 28, 2001. An amended notice of appeal referring only to the appeal against the award of costs must be served and filed on or before June 29, 2001. Synchronics partnership has not formally moved for an order permitting Mr. Brown and Mr. Leech to represent the Synchronics partnership in this appeal. However, the affidavits of Mr. Brown and Mr. Leech filed with their motion record on April 30, 2001 state that they cannot afford to retain counsel. There is no doubt, reading their material in its entirety, that they continue to maintain that they should be permitted to represent the Synchronics partnership. I note also that if the award of costs against the Synchronics partnership stands, the costs will be borne by Mr. Brown and Mr. Leech personally. On that basis, I would on my own motion grant Mr. Brown and Mr. Leech jointly leave to represent the Synchronics partnership in the appeal against the award of costs made by Mr. Justice Teitelbaum in his order dated March 28, 2001. If they wish, they may also represent the Synchronics partnership in a motion to amend the style of cause to delete the reference to Synchronics Ltd. Karen R. Sharlow J.A. "I agree A.J. Stone J.A." "I agree Robert Décary J.A." |
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