TRITEQ LOCK & SECURITY, LLC Plaintiff / Defendant by Counterclaim v. MINUS FORTY TECHNOLOGIES CORP., 2023 FC 819

Date: 20230609 Docket: T-205-19 Citation: 2023 FC 819 Toronto, Ontario, June 9, 2023 PRESENT: Associate Judge Trent Horne BETWEEN: TRITEQ LOCK & SECURITY, LLC Plaintiff / Defendant by Counterclaim and MINUS FORTY TECHNOLOGIES CORP. Defendant / Plaintiff by Counterclaim ORDER AND REASONS I. Overview [ 1 ] An undertaking given during an examination for discovery is an unequivocal promise. A party may not unilaterally resile from or reconsider what it promised to do.

A party who refuses to answer undertakings, and opposes a motion to compel answers to those undertakings, should expect to pay a significant costs award. II. Background [ 2 ] This is an action for patent infringement. The defendant is alleged to have infringed certain claims of a patent directed to a cooler lock. The defendant denies infringement, and also asserts that the patent is invalid and should be impeached. [ 3 ] The defendant’s representative was examined for discovery on March 5, 2020, and October 6, 2022.

During that examination, undertakings were given, and other questions were refused. [ 4 ] The plaintiff brought a motion to compel answers to certain discovery questions. About 90 questions were set out in a chart that was included in the motion record. Shortly before the hearing, the parties advised that many of the questions had been resolved, and about 18 remained to be adjudicated. [ 5 ] During the hearing, and for reasons given at that time, certain questions were ordered answered, and others were not.

So far, this describes a routine discovery motion. [ 6 ] What is unusual about this motion is that about half of the questions that were included in the plaintiff’s initial chart, and about half of what was argued on the motion, were undertakings that the defendant took the position it should no longer have to answer. It was submitted that information that was the subject of certain undertakings would be apparent once physical samples were provided to the plaintiff, was irrelevant, or requested information that the plaintiff should have had before the action was commenced.

It was submitted that parties should have an opportunity for " “sober second thought” " when it comes to answering an undertaking. III. Undertakings [ 7 ] In its ordinary meaning, an undertaking is a promise or a pledge to do something (see the Canadian Oxford Dictionary , 2d ed). [ 8 ] The meaning of " “undertaking” " in the context of examinations for discovery is no different.

Obligations that arise when undertakings are given were addressed in Merchant Law Group v The Queen , 2008 TCC 49 at paras 6-16 and the cases cited therein: i. a party that has given undertakings at an examination for discovery cannot later change its mind and will be bound by its original promise. A refusal to give answers to an undertaking can have detrimental consequences for the party at fault; ii. an undertaking is a form of contract.

It is a promise to produce certain information, and the consideration may well be the fact that no further questions are asked about the document at the time of the examination. At any rate it is a promise which the courts have always enforced; iii. an undertaking is an acknowledgment that the question is proper and that the subject-matter of the undertaking is relevant. Put crudely, should counsel be permitted to renege on a production-undertaking when he or she subsequently comes to the belief that a document or part thereof is not relevant in the action?

This question invades the sanctity of a solicitor’s undertaking;

iv. an undertaking is an unequivocal promise to perform a certain act; v. undertakings given by lawyers are matters of the utmost good faith and must receive scrupulous attention; and vi. once an unqualified undertaking has been given, it is too late to refuse to provide an answer on grounds of relevance. [9] See also RE/MAX, LLC v Save Max Real Estate, Inc, at para 10: "“[u]ndertakings are considered binding.

When aparty, being under no obligation to give an undertaking, freely undertakes to provide further answers or documents, the undertaking mustbe honoured.”" [10] A party may bring a motion to be relieved of an undertaking.

The defendant has brought no such motion. [11] The Law Society of Ontario’s Rules of Professional Conduct specifically address undertakings in rule 5.1-6: "“a lawyer must strictlyand scrupulously fulfill any undertakings given by him or her and honour any trust conditions accepted in the course of litigation.”" Thecommentary to that rule states that "“unless clearly qualified, the lawyer's undertaking is a personal promise and responsibility.”" [12] There is no principled basis upon which I can accept the defendant’s submissions and conclude that undertakings can or should besubject to any form of unilateral reconsideration.

If an undertaking is given to do something, a party is expected to do exactly that, nomore and no less. IV. Costs [13] The Court has full discretionary power over the amount and allocation of costs (subrule 400(1)). [14] Among the factors I can consider in the assessment of costs is whether a step was improper, vexatious or unnecessary (subrule400(3)(k)(i)). [15] An award of costs can perform more than one function.

Costs can regulate conduct (e.g. by promoting early settlement), indemnifythe successful party, and deter impetuous, frivolous and abusive behaviour (Sherman v Canada (National Revenue), 2003 FCA 202 atpara 46). [16] I agree with the defendant’s submission that parties should not be discouraged from advancing novel legal positions. That is howthe common law grows and develops. But novel legal positions must have a plausible foundation. The language used to describe thenature of undertakings includes "“promise”", "“sanctity”", "“unequivocal”", and "“scrupulous”".

If any part of the discovery process hasbeen carved in stone for decades, it is that undertakings are expected to be answered in full and on time.

The defendant offered nojurisprudence, academic commentary, or submissions that would enable me to conclude that the Court should depart from these long-established principles. [17] Accepting the defendant’s submissions would introduce great uncertainty to the discovery process, and certainly increase thenumber and duration of discovery motions. [18] The defendant’s position on this issue was so far from established principles and jurisprudence that it lacked any kind of reasonablefoundation.

The plaintiff should not have been required to bring a motion to compel answers to undertakings, and certainly should nothave been required to spend time and money arguing whether an undertaking should be answered.

Subrule 401(2) of the Federal CourtsRules SOR/98-106 applies, and costs will be payable forthwith. [19] As for quantum, recovery under the Tariff, even at the high end of Column V, would be inadequate to compensate the plaintiff forits costs associated with this motion, and address the frivolous nature of the defendant’s position. [20] I asked the plaintiff to make reference to its solicitor-client fees as part of its cost submissions. I was advised that the cost to theplaintiff for this motion was in the range of $15,000.00 to $16,000.00.

The plaintiff asked that costs be fixed at $5,000.00; the defendantsubmitted that costs should be fixed at $4,000.00. [21] A cost award of $5,000.00 would be insufficient to address how entirely unnecessary most of this motion was. There must be nodoubt that contested motions involving a unilateral refusal to answer undertakings will result in a significant costs award. Costs will befixed at $7,500.00, payable forthwith and in any event of the cause. ORDER in T-205-19 THIS COURT ORDERS that: 1.

By no later than August 31, 2023, the defendant shall provide the plaintiff with written answers to the following questions, asidentified with the chart attached as

schedule “A” at tab 1A of the plaintiff’s motion record dated April 6, 2023: items 2-6, 7-10,11, 12, 14-16, 21-24, 26, 31, 37, 43, 45, 17-19, 30, 32-36, 41-42, 46-61, 64-74, the unnumbered rows after items 69 and 70, 76-77,80-81, 84-89, and 90. 2. The defendant does not need to provide the plaintiff with answers to the following questions, as identified with the chart attachedas

schedule “A” of tab 1A of the plaintiff’s motion record dated April 6, 2023: items 25 and 83. 3. The defendant shall provide access to samples of a Minus Forty refrigerator with a Generation I lock installed, a Minus Fortyrefrigerator with a Generation II lock installed, a Minus Forty freezer with a Generation I lock installed, a Minus Forty freezer with

a Generation II lock installed, as well as the Royal Vendors Unit, at a third-party facility, where the plaintiff will have access to the units with the defendant present, at date(

s) and time(

s) to be agreed upon. 4 . The defendant shall make its representative available for follow-up discovery at a date and time to be agreed upon, unless the parties agree that further discovery be in writing. 5 . Costs of the motion are payable by the defendant to the plaintiff, fixed at $7,500.00, payable forthwith and in any event of the cause. "Trent Horne" Associate Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-205-19 STYLE OF CAUSE: TRITEQ LOCK & SECURITY, LLC v MINUS FORTY TECHNOLOGIES CORP. PLACE OF HEARING: HELD BY VIDEOCONFERENCE DATE OF HEARING: May 25, 2023 ORDER AND REASONS: HORNE A.J.

DATED: June 9, 2023 APPEARANCES : Andrew I. McIntosh Nyrie Israelian For The Plaintiff / DEFENDANT BY COUNTERLAIM Pierre Robichaud Trevor Wong For The Defendant / PLAINTIFF BY COUNTERCLAIM SOLICITORS OF RECORD : BERESKIN & PARR LLP Barristers and Solicitors Toronto, Ontario For The Plaintiff / DEFENDANT BY COUNTERLAIM ANDREWS ROBICHAUD P.C. Barristers and Solicitors Ottawa, Ontario For The Defendant / PLAINTIFF BY COUNTERCLAIM