RITCHIE’S INVESTMENT INC. operating as, RITCHIE’S CARPET WAREHOUSE Applicant – v. –, 2023 NBKB 148

Citation: 2023 NBKB 148 Date: 2023-09-08 Docket: FC-207-2023 IN THE COURT OF KING’S BENCH OF NEW BRUNSWICK TRIAL DIVISION JUDICIAL DISTRICT OF FREDERICTON BETWEEN: RITCHIE’S INVESTMENT INC. operating as, RITCHIE’S CARPET WAREHOUSE Applicant – and – TREVOR RITCHIE, ADAM RITCHIE, RITCHIE’S DISCOUNT CARPET LTD. operating as RITCHIE’S FLOORING WAREHOUSE and, GREG LONG Respondents Date of Hearing: August 28, 2023 Date of Decision: September 8, 2023 Subject Matter: INJUNCTION Before: Justice E. Thomas Christie At: Burton, New Brunswick Appearances: Mr. Roman Veil, Mr. Tyler Ryan and Mr.

Bryan Mills, for the Applicants Mr. George Cooper, K.C. and Mr. Matthew LeBlanc, for the Respondents Christie, J. (Orally) I. INTRODUCTION [ 1 ] For many decades, the Ritchie family has been involved in the sale of flooring, windows, paint and other construction materials for residential and commercial customers. Since the inception of the Ritchie family business, there have been generational changes in the corporate leadership. The most recent involved certain corporate assets owned and operated by Kevin Ritchie and other assets owned and operated by his brothers, Respondents Trevor and Adam Ritchie.

In late 2022, Kevin Ritchie agreed to sell his business interests in Ritchie’s Investments Inc., which did business in Fredericton region under the registered business name of Ritchie’s Carpet Warehouse. The Respondents, Trevor Ritchie and Adam Ritchie owned and operated Ritchie’s Discount Carpet Ltd. doing business under the name Ritchie’s Flooring Warehouse in the Moncton and Nova Scotia areas.

As far as the Record indicates, both Ritchie’s Flooring Warehouse and Ritchie’s Carpet Warehouse operate the same type of business selling flooring, windows, paint and associated products and services. [ 2 ] The heritage of the family businesses can be traced back to their great-grandfather who opened the first ‘Ritchie’ family

business in 1966. Kevin Ritchie has sold his business interest in the Applicant which, since closing of the sale in January 2023, has continued doing business in Fredericton under the name Ritchie’s Carpet Warehouse. With this sale by Kevin Ritchie, the operation of a business, which contained the Ritchie name, was now held by someone outside the family. [ 3 ] It was asserted that there was an understanding between the brothers that Ritchie’s Flooring Warehouse would not compete in the regions where Ritchie’s Carpet Warehouse did business. This was reciprocated.

Therefore, Trevor and Adam Ritchie did not directly compete in the Fredericton market and, similarly, Kevin Ritchie did not operate in the markets covered by Trevor and Adam Ritchie. The Respondents did provide certain invoices they say were from certain Fredericton customers it had over the years, but were not tendered to refute the generally understood ‘market exclusivity’ the Ritchie brothers asserted had existed between them for decades. [ 4 ] At issue presently is the Fredericton market which has, since 1984, been served by the Applicant under the business name Ritchie’s Carpet Warehouse.

It has been built into a substantial business with annual sales in the last number of years exceeding $15,000,000 in each year. Following the completion of the sale/purchase in late 2022, Ritchie’s Carpet Warehouse continued operation servicing the local market for flooring, windows, paints and other construction products. [ 5 ] However, in the months that have followed Kevin Ritchie’s sale of his interest in the Fredericton business, it became apparent that Trevor and Adam Ritchie felt unencumbered by past family loyalty or unwritten agreement or understanding to not compete in each other’s region.

Trevor and Adam Ritchie made plans to bring Ritchie’s Flooring Warehouse to Fredericton. On August 14, 2023, Trevor and Adam Ritchie opened their Fredericton location of Ritchie’s Flooring Warehouse. It is located less than three kilometers from Ritchie’s Carpet Warehouse. [ 6 ] In this Motion, the Applicant seeks injunctive relief to prevent the Respondents from carrying on business in Fredericton using the ‘Ritchie’s’ name.

They take no issue with the Respondents continuing to carry on the business they have recently opened - just not with the name ‘Ritchie’s’ – a name which in the Fredericton area has a business reputation cultivated, I find, over many years by the Applicant. [ 7 ] A complicating factor is that in the days leading up to the August 14 th opening of Trevor and Adam’s Ritchie’s business in Fredericton, twelve employees of Ritchie’s Carpet Warehouse (Applicant) resigned without apparent notice. This includes the Respondent Greg Long. The Applicant asserts it was caught completely off-guard by this mass resignation.

These employees were immediately re-employed at the Respondent’s new Fredericton store. Moreover, the Applicant argues, that during the course of this mass resignation, sensitive business information of the Applicant’s was taken by certain of those employees for the purpose of benefiting the Respondent. [ 8 ] In fact, Respondent Greg Long, deposes in his affidavit that: However, shortly before my resignation, I took photographs of certain information regarding pending customer orders that were made with Ritchie’s Carpet Warehouse. [Record p. 404] [ 9 ] Mr.

Long explains he took the photographs to ensure that none of the Applicant’s customer’s orders fell through the cracks during the transition. However, he further deposes that: On Sunday August 20, 2023, I deleted all photographs of potentially confidential information that I had taken. I am no longer in possession of these photographs as they have been destroyed. The original records from which these photographs were taken remain, so far as I am aware, in the possession of Ritchie’s Carpet Warehouse. [Record p. 405] [ 10 ] The propriety of Mr.

Long’s actions in the lead-up to his resignation (specifically his dealing with the Applicant’s business records) will be a matter for determination at the trial. Nevertheless, his handling of the Applicant’s business records given the timing of his departure, the mass resignations from the Applicant, followed by the essentially immediate re-employment by the Respondent do raise issues of concern for resolution at trial. II.

ISSUES and ANALYSIS [ 11 ] The Applicant seek an order prohibiting the Respondents from passing their business off as that of the Applicant’s pending determination at trial of the underlying claim. In essence, the Applicant seeks an order prohibiting the Respondent from operating Ritchie’s Flooring Warehouse in the Fredericton region. The Applicant is not attempting to prevent the Respondent from operating the type of business it has opened in Fredericton – even in direct competition with the Applicant - only that it be prohibited from doing so

using the name ‘Ritchie(’s)’. In my view, the requested relief can be considered as a narrow limitation on the Respondent’s operation. [ 12 ] The Applicant asserts that it has spent decades developing its business reputation within the Fredericton community. As noted above, I find this to be accurate. It highlights its longstanding advertising within the Fredericton community from the use of glossy flyers to radio commercials with its distinctive Ritchie’s jingle.

While the Respondent has also been operating their business in other markets for decades, it has not been a relevant participant in the Fredericton flooring market. This is because, the Respondents assert, there was an unwritten understanding between the three brothers that they would not compete on each other’s territory. There is no written document memorializing such an understanding.

Nevertheless, there is sufficient evidence in the Record to establish (for the present purposes) that there has been decades of business history confirming that Kevin Ritchie had Fredericton and Trevor and Adam Ritchie operated elsewhere. [ 13 ] I find as a fact, on the evidence in the Record, that the business presence in the Fredericton market has been dominated (as between the Ritchie brothers) for years by the Applicant, doing business as Ritchie’s Carpet Warehouse.

It borders on being entitled to recognition by way of judicial notice that, in the Fredericton region, when persons speak colloquially of, ‘going to Ritchie’s’, they are referencing the Applicant. I mention this again below. [ 14 ] Trevor Ritchie deposes that the business use of the ‘Ritchie’ name was based on a ‘licence’ to do so granted by the grandfather and that it has been understood that the condition for such use was that only family members could use that name for business purposes.

The Respondents say that since the Applicant is no longer owned by a family member, it should be prohibited from using ‘Ritchie’ in its business operation. There are no documents in the Record which support the existence of this license to use the ‘Ritchie’ name.

I also note that the Respondents, having known since early 2023 that Ritchie’s Carpet Warehouse has been operated by a non-family member, has not taken any steps to prevent the use of the name ‘Ritchie’ by the Applicant based on this purported licensing arrangement. [ 15 ] Furthermore, I am unsure what the Respondents Trevor and Adam Ritchie see as the scope of such an exclusive unwritten licence arrangement originating, as they say it does, from their grandfather.

Does an unrelated Ritchie family in Campbellton, for instance, have the right to open a ‘Ritchie’s Auto Sales’ or any business using their own family name? In my view, I see little of value in the Respondents’ argument on this point. [ 16 ] The Record contains evidence that, on at least one occasion, a delivery vehicle has gone to the wrong Ritchie’s in Fredericton to make a delivery. This, the Applicant argues, shows the confusion that now exists – created by the business activities of the Respondents. This, coupled with the desire of Mr.

Long to take pictures of the Applicant’s business records, so that he could assist with any customer confusion that might arise with the new business opening, is evidence of the actual and potential confusion within the community. [ 17 ] The Respondents says that, given they have a provincially registered business name pursuant to the applicable legislation ( Partnership and Business Names Registration Act , RSNB 1973, c. P-5 ) for the use of Ritchie’s Flooring Warehouse, there can be no limitation imposed by the court on where, within the province, that name can be used.

This point was a particular focus of Respondents during argument. In essence, the Respondent argues that this puts an end to the jurisdiction to grant an injunction because it is exercising a statutorily granted right to use the name it registered. [ 18 ] On this point it is worth noting that the Respondents registered the business name, Ritchie’s Flooring Warehouse, on January 1, 2013. The Applicant registered its business name, Ritchie’s Carpet Warehouse, on October 10, 1984.

While it may be accurate to state that registration gives a party the right to use that business name in markets throughout the province the reality is that, until August 14, 2023, the Respondent had specifically chosen not to do so in the Fredericton region - intentionally leaving that market, substantially, to Ritchie’s Carpet Warehouse. I recognize that the Respondents have provided a number of invoices for clients it has served in the Fredericton area.

It is hard to know what to make of this argument given the Respondents’ position that there existed a ‘gentleman’s agreement’ between brothers to not compete in each others’ territory. In any event, in my view, any consequences that flow from the choice to not directly bring Ritchie’s Flooring Warehouse into a market that had, apparently by agreement, been left to Ritchie’s Carpet Warehouse, is a matter to be canvassed at trial. [ 19 ] I am not convinced by the Respondents’ argument that the provincial registration of its business name gives it unfettered right to use its business name anywhere in the province.

There was no jurisprudence provided by the Respondents confirming that the administrative registration of a business name under a provincial statute, supplants the courts inherent jurisdiction to issue, in proper circumstances, certain limitations by way of injunctive relief. I am unable to give this argument of the Respondents’ the definitive characteristic I was encouraged to do. As Abella, J. wrote in Google Inc. v. Equustek Solutions Inc . 2017 SCC 34 at para. 23 : Injunctions are equitable remedies. “The powers of courts with equitable jurisdiction to grant injunctions are, subject to any relevant

statutory restrictions, unlimited” (Ian Spry, The Principles of Equitable Remedies (9th ed. 2014), at p. 333). [20] The Applicant asserted that, when it opened for business on August 14th, 2023, following the mass resignation (twelveemployees within a three-minute period) it found that certain consequential business records were missing.

As Denise Ring, GeneralManager of the Applicant, deposes at p. 84 of the Record (para. 15): However, as the day progressed [being the next workday following the mass resignations] it became clear that Ritchie’s was missingseveral important documents, such as estimates, work orders, a customer directory book, and price lists. [21] In response, Ms. Ring began a review of CCTV security footage.

It can be seen from the captured screen shots that at datesand times coincident with the mass resignations, certain employees are leaving the Ritchie’s Carpet Warehouse store with what could beinferred as being business records of the Applicant. A customer of Ritchie’s Carpet Warehouse, Cory Miller, deposed that he had placed an order for a specific project through a salesperson, Trevor Wheeler, in July 2023. On August 14th, Mr. Wheeler contacted Mr. Millerand told him that he was now working for Ritchie’s Flooring Warehouse and that he could fill Mr.

Miller’s order in a matter of weeks.There were no records of the July 2023 order found in the Ritchie’s Carpet Warehouse store following the mass resignations. [22] I also highlight the affidavit of Elie Hachey, a general contractor and customer of Ritchie’s Carpet Warehouse. Mr.Hachey notes that he has been a customer of “Ritchie’s” [Carpet Warehouse] for over thirty years. He deposes as follows at p. 58 of theRecord, para. 3: On August 14, 2023 at approximately 9:22 am, I received a call from Mr. Long. Mr. Long said that “we moved” to a “new spot” at theFredericton Mall.

When I asked for clarification, he informed me that he was still at Ritchie’s but that he was working for theRespondent, Trevor Ritchie and Adam Ritchie, in Fredericton. He also informed me that they had $9,000,000 in inventory. [emphasisadded] [23] Of note to me in the above (a conversation he did not dispute in his affidavit) is that Mr. Long stated that “we moved”.Maybe that meant the staff moved, or maybe it meant that the store he worked in for 19 years had moved. Precisely what he meant canbe determined at trial. But both Elie Hachey and Mr. Long refer to the business as “Ritchie’s.

It is an indicator to me that, having beenthe only Ritchie’s doing business in the Fredericton region for decades, “Ritchie’s” in the Fredericton market, means Ritchie’s CarpetWarehouse. So, when Mr. Long advised Elie Hachey that he still worked at “Ritchie’s” it can be readily inferred that to a customer ofover thirty years, Ritchie’s meant Ritchie’s Carpet Warehouse. At a minimum it can contribute to confusion as to who one is dealingwith. [24] The Respondents, on August 22, 2023, in apparent response to any confusion in the Fredericton area, determined it washelpful to issue a corporate announcement.

As Trevor Ritchie deposed at p. 278 of the Record, “On August 22, 2023, Ritchie’s FlooringWarehouse released a corporate announcement to alleviate any confusion.” [emphasis added].

The corporate announcement stated, inpart, the following: Please note that Ritchie’s Flooring Warehouse is a separate business not affiliated with Ritchie’s Carpet Warehouse – a company whichis no longer owned by any member of the Ritchie family. [25] I note in passing that the Record does not contain information indicating that the August 22nd corporate announcementreceived the same level of distribution typically associated with the advertising of the businesses themselves. In other words, it is unclearwho would have reasonably had access to, or been exposed to, the announcement.

But the acknowledged need to issue the statement atall, even if just precautionary, speaks to the concern surrounding the necessity to keep straight in the minds of customers which‘Ritchie’s’ customers are dealing with – because for the last number of decades the only Ritchie’s selling flooring, window, doors, paintsor other such products in the Fredericton region was the Applicant.

While, as noted above, the Respondents provided 58 invoices fromits customers for product and services it provided in the Fredericton region over an 11-year period, it is insignificant in volume incomparison to the more than $15,000,000 yearly sales of the Applicant. III. TEST FOR INJUNCTIVE RELIEF [26] The parties correctly identified the test to be applied is that set out in RJR MacDonald v. Canada, (SCC),[1994] 1 SCR 311. The three-part test is as follows: i. Is there a serious issue to be tried? ii. Is there irreparable harm which cannot be compensated for in damages?

iii. Does the balance of convenience favour granting the injunction? [27] With that said, as Abella, J. wrote in Google Inc. at para. 1: Ultimately, the question is whether granting the injunction would be just and equitable in all the circumstances of the case. A. SERIOUS ISSUE TO BE TRIED [28] With respect to step (i), the Respondents agree that the issues raised in the underlying proceedings are not frivolous orvexatious. Step (

i) is typically seen as creating a low threshold to meet (RJR p. 337). However, there is, the Respondents argue, a moresubstantive consideration required if granting the injunction would effectively determine the underlying claim which, the Respondentsargue, would be the result (RJR p. 338). As set out at para. 50 of the Respondents’ pre-hearing brief: 50.

In other words, granting the motion for [an] interlocutory injunction will, in effect, amount to a final determination of the actionwhich will impose such hardship as to remove the benefit from proceeding to trial. [29] In my view, granting an injunction in these circumstances would do no such thing. That may more arguably have been thecase had the Applicant sought to prevent the Respondents from conducting any competing business in the Fredericton region – but that isnot the scope of the relief sought.

The Applicant is quite prepared to have the Respondents carry on a directly competing business. [30] At issue in the underlying action is the tort of passing-off. There is nothing in the granting of the injunction that should beconsidered as determinative of the substance of the underlying claim. The purpose of an injunction of this type is, in part, to limit thepossible accrual of damages (ADP Distributors Inc. v Davidson, 2019 BCSC 219) or reset the status quo to ensure that the subject matterof the litigation can be preserved (Google Inc. para. 24) and let the parties have their issues determined in a court.

Step (

i) is, I find,satisfied. The issues are serious, and by no means frivolous or vexatious. B. IRREPARABLE HARM [31] Step (ii) requires that the Applicant satisfy the court that it will suffer irreparable harm if the injunction is not granted.RJR, at p. 41 provides the following description of irreparable harm: “Irreparable” refers to the nature of the harm suffered rather than its magnitude. It is harm which either cannot be quantified in monetaryterms or which cannot be cured, usually because one party cannot collect damages from the other.

Examples of the former includeinstances where one party will be put out of business by the court’s decision (R.L. Crain Inc. v. Hendry (1988), (SK KB), 48 D.L.R. (4th) 228 (Sask. Q.B.)); where one party will suffer permanent market loss or irrevocable damage to its businessreputation (American Cyanamid, supra); or where a permanent loss of natural resources will be the result when a challenged activity isnot enjoined (MacMillan Bloedel Ltd. v. Mullin, (BC CA), [1985] 3 W.W.R. 577 (B.C.C.A.)).

The fact that one partymay be impecunious does not automatically determine the application in favour of the other party who will not ultimately be able tocollect damages, although it may be a relevant consideration (Hubbard v. Pitt, [1976] Q.B. 142 (C.A.)). [32] Presently, there is no argument that the corporate Respondents would be unable to pay an award of damages if theApplicant succeeded at trial.

The Applicant’s principle argument on irreparable harm rests on the confusion created by two ‘Ritchie’s’businesses operating less than three-kilometers from each other providing, essentially, the same goods and services. In addition, whilethere are differences in the public signage or advertising used by both operations, the similarities are more striking. Exception was takenby the Respondents to the apparent inadvertent use by the Applicant of the Respondent’s logo in a social media post advertising a clientappreciation bar-b-que the Applicant was to hold.

This was an issue that arose, in part, because of the very ease by which one business ortrade logo might be confused with the other. [33] Furthermore, how would one be able to track or measure if a customer mistakenly did business with the Respondents,thinking that they were doing business with what has been the established ‘Ritchie’s’ in Fredericton? This is particularly so if theRespondent’s employees are, for instance, answering phones or emails by the use of the ‘Ritchie’s’ name. Essentially, the Respondentmay find that a certain percentage of their customers are in their store out of confusion.

Of course, the opposite could also be true in thatit is possible that a customer of Ritchie’s Carpet Warehouse intended to be a customer of Ritchie’s Flooring Warehouse. This type ofscenario could give rise to damages that would be unquantifiable.

[34] There is evidence in the Record to support the Applicant’s contention that, even after two weeks of the Respondentoperating in Fredericton, customers of the Applicant have been confused as to the status of their orders. In addition is the concern arisingfrom the evidence of the delivery driver getting mixed up as to which ‘Ritchie’s’ deliveries were to be made. The importance of clarity incustomer choice was stated by the Supreme Court in Masterpiece Inc. v. Alavida Lifestyles Inc. 2011 SCC 27 , [2011] 2 S.C.R.387.

While Masterpiece Inc. deals specifically with concerns arising from the applicability of the Trade-marks Act, R.S.C. 1985, c. T-13,the principles expressed therein can be of assistance. At para. 1 is found the following: In a marketplace, a business marks it wares or services as an indication of provenance.

This allows consumers to know, when they areconsidering a purchase, who stands behind those goods or services. … Confusion between trade-marks impairs the objective ofproviding consumers with a reliable indication of the expected source of wares or services. [35] As noted in Masterpiece Inc., the basis of customer confusion is not difficult to establish. It is a matter of first impressionin the mind of the consumer (para. 40).

At para 41, the Court applies this ‘first impression’ principle to the facts in that case, noting: In this case, the question is whether, as a matter of first impression, the “casual consumer somewhat in a hurry” who sees the Alavidatrade-mark, when that consumer has no more than an imperfect recollection of any one of the Masterpiece Inc. trade-marks or trade-name, would be likely to be confused: that is, that this consumer would be likely to think that Alavida was the same course of retirementresidence services as Masterpiece Inc. [36] The Respondents argues that a claim of a loss of goodwill by the Applicant must be supported by specific evidence.

Suchclaims, they argue, cannot be simply speculative (Centre Ice Ltd. v. National Hockey League, [1994] FCJ No. 68). A customer base,confused by the actions of a new competitor could, in circumstances like those present, undermine a business’s goodwill.

With theevidence of customer and supplier confusion, arising after just two weeks of the Respondent being in open competition to the Applicant,it would not be unreasonable to consider that the Applicant’s goodwill is, at a minimum, at some risk. [37] In my view, the present circumstances of this case, create a challenge to the existing goodwill of the Applicant and further,the circumstances make it difficult to quantify any damages a court may, following trial, consider appropriate.

To be clear, I make thesecomments in the context of the evidence presented for the purposes of the present motion and should not be construed as suggesting anexpected outcome on the merits following trial. The present case is not about a single contract giving rise to a claim of enforcement. TheApplicant’s and the Respondent’s businesses exist on the basis of hundreds, if not thousands, of single contractual transactions each yearbetween the companies and their customers or between the companies and their suppliers.

I have not been provided with any suggestionas to how interference in those individual contractual relationships could be legitimately established or damages calculated. [38] I would also note, and while not necessary to the determination I have made of the existence of irreparable harm, I haveconcern over the allegations that there may have been a concerted effort to have the employees who left the Applicant’s business bringwith them certain business records of the Applicant – the purpose of which could not be benign.

These are allegations to be tested at trialbut there is certain evidence in the Record that could explain why the Applicant thinks as it does. If it turns out, after trial, that any of theApplicant’s former employees did remove from the Applicant’s premises business records which were then used in furtherance of theRespondent’s business, then that conduct may also enhance the difficulty in being able to quantify damages.

As the Respondent notes inits pre-hearing brief at para. 85, “… it [Respondent] has hired 12 persons to operate the new store.”, some of those employees can beseen on security recordings leaving the Applicant’s premises with items which are not known. It may well be that they were takingpersonal items when they left, but when considered in light of Mr. Long’s admission that he photographed certain of the Applicant’sbusiness records when he left and then deleted them from his computer, the question is legitimately raised if others did similar things. C.

BALANCE OF CONVENIENCE [39] I have no difficulty concluding that the balance of convenience favours the Applicant. At the time of the hearing, theRespondents had been operating their Fredericton location for approximately two weeks. This is compared to the decades-long period oftime for which the Applicant was the only ‘Ritchie’s’ operating in the Fredericton market. The Respondent is not starting a new type ofbusiness – it is conducting the same type of business it does in its other locations. It may have obtained additional inventory to open itsnew store. But that is not clear.

Or maybe the inventory was gathered from its other locations. In any event, I am not convinced that anorder, pending the conclusion of trial, preventing the Respondents from using the name Ritchie’s in its Fredericton location presents afinancial obstacle it cannot handle. This can also be true of the Respondents concern over the lease it says it now has for the Frederictonlocation. They can still sell their products. [40] The Respondents argue that it would be a considerable restraint of trade to prevent it from exercising its right to operate itsbusiness in Fredericton as Ritchie’s Flooring Warehouse.

Given the recency of their choice to move into the Fredericton market moredirectly, it does not appear that the delay necessary to resolve the underlying claim is unreasonable. As I have repeated throughout, this isnot a prohibition on the Respondents carrying on the business they have set up in Fredericton – a business which is an apparent directcompetitor to that of the Applicant. Temporarily resolving any confusion that may exist in the minds of the buying public and allowing

time to resolve any merits of the underlying claim, would not unduly harm the business of the Respondent in Fredericton. Until a fewweeks ago, it had no store front business in Fredericton. The Applicant has, quite rightly, sought a relatively narrow scope of relief. TheRespondent’s are entitled to carry on their competing business. [41] In

summary, I find that there are serious issues to be tried. I find that there would be irreparable harm to the Applicantshould the injunction not be granted. I find the balance of convenience favour the Applicant. [42] Both parties took time in their submissions to address concern over whether each came to court with clean hands withrespect to the former employees of the Applicant’s – employees who resigned en masse without apparent notice. The Respondents pointto the Applicant’s delay in issuing the former employees’ final pay.

The Applicant point to the apparent coordinated resignations and themissing business records. Certain of these issues are raised in the Statement of Claim. As noted, Mr. Long acknowledged tophotographing certain of the Applicant’s business records around the time he was leaving. [43] The ‘clean hands’ concerns in this case clearly go both ways and it is my view that those concerns are best left for trial.Employment contracts are unique in the sense that they recognize a special relationship between an employee and an employer.

But theyare, nonetheless, contracts – contracts that contain duties and obligations not only from employer to employee, but also from employee toemployer – particularly at the time of termination. The absence of a written contract of employment does not mean that obligations asbetween employer and employee are not legally recognized. In Consbec Inc. v. Walker, 2016 BCCA 114 the court noted at paras. 67, 73: [67] The trial judge awarded damages against Peter for his having left Consbec without giving Consbec reasonable notice; whatMr. Justice Robertson in Ainscough v.

McGavin Toastmaster Ltd. (1974), (BC CA), 45 D.L.R. (3d) 687 at 699(B.C.C.A.), aff’d (SCC), [1976] 1 S.C.R. 718, referred to as “a wrongful quitting”. … [73] As discussed in Physique Health Club Ltd. and Sure-Grip Fasteners Ltd., the main purpose of the notice requirement is to givethe employer a reasonable time to adjust to the employee’s departure.

In determining the appropriate notice period regard should be hadto the employee’s duties and responsibilities, salary, length of service, and the time it would reasonably take the employer to have othershandle the employee’s work or to hire a replacement. [44] In my view, delving into the competing claims of ‘clean hands’ at this time, tied as it is to the existence of mutualobligations between employer and employee is of no value. Such matters are best left for trial. IV.

CONCLUSION [45] In conclusion, the injunction is to be granted in the form as set out in the requested relief of the Applicant’s AmendedNotice of Motion. I find, in the words of Abella, J. that it is just and equitable in the present circumstances. In

summary, the Respondents(and each of them) are enjoined from operating any business (that directly competes with that of the Applicant) using the name“Ritchie’s” or any similar name that would be confusing to customers in the Fredericton region. In addition, all employees of theRespondent are prohibited from representing themselves as “Ritchie’s” employees or representatives in the Fredericton region.

And, thatthe Respondents and their employees and representatives are prohibited from using or displaying any signage or other marketingmaterials that includes the name “Ritchie’s” at their place of business in the Fredericton region.

All of which is ordered pending furtherorder of the court. [46] I would allow until end of business Monday September 11, 2023 [a date set by me after consultation with counsel] for theRespondents to deal with any necessary public displays or advertising in the Fredericton region or the dismantling of any signage orother business use of the word ‘Ritchie’s’ in its Fredericton operations. I would ask counsel for the Applicant to draft the order inconformity to the relief sought in the Amended Notice of Motion at p. 2 thereof to include subparagraph (b), (c), (d).

As for the relief in(b), asking that it be ordered that the Respondents stop passing themselves off as the Applicant, that is a matter for trial. While theNotice of Motion did not specify a geographical definition of the ‘Fredericton Region’, counsel for the Applicant suggested duringargument it be considered to be within a radius of 50 kilometres from the Applicant’s business on Hanwell Road.

Should counsel have anissue with the definition being as suggested, I will hear counsel on this shortly. [46] The Applicant is entitled to one set of costs from the Respondents, jointly and severally, in the amount of $2,000.00 plusHST and allowable disbursements. ______________________ Justice E. Thomas Christie

Court of King’s Bench of New Brunswick, Trial Division