DATE: 20020207 DOCKET: C36346
COURT OF APPEAL FOR ONTARIO
RE:
ICE FASHIONABLE ACCESSORIES INC., and ICE FASHIONABLE ACCESSORIES (VANCOUVER) INC., Plaintiffs (Respondents) – and - HOLT, RENFREW & CO. LIMITED, Defendant (Appellant) – and between - ICE FASHIONABLE ACCESSORIES INC., and ICE FASHIONABLE ACCESSORIES (VANCOUVER) INC., Plaintiffs (Respondents) – and - HOLT, RENFREW & CO. LIMITED, Defendant (Appellant)
BEFORE:
MORDEN, GOUDGE and SHARPE JJ.A.
COUNSEL:
Robert S. Russell and Adam F. Fanaki for the appellant
A.T. McKinnon for the respondents
HEARD:
January 30, 2002
E N D O R S E M E N T
On appeal from the order of Mr. Justice Pitt dated April 20, 2001.
[1] Mesbur J. decided at the trial directed by Somers J. that the evidence did not support the claims based on interference with contractual or economic relations. In our view, these findings give rise to an issue estoppel against the plaintiff with respect to those claims.
[2] We do not accept the argument that by successfully setting aside the judgment against it for damages and an injunction, the appellant must be taken to have also set aside the findings made in its favour. With respect to the motions judge, we see no logical or policy basis for requiring the appellant to forego the decisions in its favour as the price of setting aside the judgment which was, wrongly, granted against it.
[3] The respondents submit that they might have been assisted by admissions in the pleadings or from documentary and oral discovery in making out their claim for interference with contractual and economic relations had the action had proceeded as a defended action in the ordinary manner. In our view, the respondents can hardly complain about any disadvantages of proceeding by default. Knowing that the appellant intended to defend the action, the respondents deliberately proceeded by default and went to trial on the basis of the evidence they had. Having failed to prove the claims for interference with contractual and economic relations, the respondents are now precluded by the doctrine of issue estoppel from proceeding again to trial on those claims.
[4] However, with respect to the claims based on misleading and false advertising of various products, Mesbur J. made findings in favour of the respondents. On those claims, she found that the actions of the appellant had caused harm and damage to the respondents, and she awarded a broadly worded injunction, enjoining the appellant from using certain phrases “relating to any product carried by the plaintiffs.” As well, she awarded $10,000 damages with respect to the product “Beauty Parlour Night Kit”.
[5] In view of those findings and the remedies awarded, we do not accept the appellant’s submissions that only the “Beauty Parlour Night Kit” claim for false and misleading advertising should be allowed to proceed to trial. It is apparent from the injunction she awarded that Mesbur J. did not reject or dismiss the cause of action for false and misleading advertising in relation to the other products. While the damages award was limited to the “Beauty Parlour Night Kit” claim, the injunction was premised on a finding that the respondents had suffered harm in relation to other products as well. This finding supports rather than extinguishes the false and misleading advertising claims. As the respondents are entitled to proceed on these claims for an injunction, it would not serve the ends of justice to preclude them from claiming the remedy of damages. We do not accept the submission that the conduct of the respondents in relation to these claims supports a plea of abuse of process.
[6] In the result, the appeal is allowed in part. The order of Pitt J. is varied by the addition of a paragraph dismissing the claims for unlawful interference with contractual and economic relations. As there has been divided success, we would also set aside Pitt J.'s order of costs and order that there be no order as to costs, either here or before Pitt J.
[7] The appeal from the order dismissing the motion to consolidate is interlocutory in nature and is quashed without costs.
“J.W. Morden J.A.”
“S.T. Goudge J.A.”
“Robert J. Sharpe J.A..”