Canadian Tire Corporation v. Canadian Bicycle Manufacturers Association

Canadian Tire Corporation v. Canadian Bicycle Manufacturers Association Court (s) Database Federal Court of Appeal Decisions Date 2006-02-10 Neutral citation 2006 FCA 56 File numbers A-439-05 Decision Content Date: 20060210 Docket: A-439-05 Citation: 2006 FCA 56 Present: NADON J.A. BETWEEN: CANADIAN TIRE CORPORATION, LIMITED Applicant and CANADIAN BICYCLE MANUFACTURERS ASSOCIATION, RALEIGH CANADA LIMITED, GROUPE PROCYCLE INC., A. MORDO AND SON LTD., YONG QI (CHANGZHOU) INDUSTRIAL CO., LTD., LIYANG (SHEN ZHEN) MACHINERY CO., LTD., LIYANG (VIETNAM) INDUSTRIES CO., LTD., SPECIALIZED BICYCLE COMPONENTS CANADA, INC., CERVÉLO CYCLES INC., GIANT MANUFACTURING CO., LTD., TAIWAN BICYCLE EXPORTERS' ASSOCIATION, KENTON BICYCLE CO., ACEBIKE BICYCLE CO., LTD., PRIDE INTERNATIONAL INC., CHINA BICYCLE ASSOCIATION, CHINA CHAMBER OF COMMERCE FOR IMPORT AND EXPORT OF MACHINERY AND ELECTRONIC PRODUCTS, BANGKOK CYCLE INDUSTRIAL COMPANY LIMITED, RETAIL COUNCIL OF CANADA, CANADIAN ASSOCIATION OF SPECIALTY BICYCLE IMPORTERS, TREK BICYCLE CORPORATION, CANNONDALE BICYCLE CORPORATION, GIANT BICYCLE CANADA INC., ASTRO ENGINEERING VIETNAM CO., LTD., ASAMA YUH JIUM INTERNATIONAL VIETNAM CO. LTD., ALWAYS CO., LTD., VIETNAM SHENG FA INTERNATIONAL CO., LTD., DRAGON BICYCLES VIETNAM CO. LTD., SYNDICAT DE MÉTALLOS, GENESIS CYCLE INC., LAIDLAW HOLDINGS INC./TO WHEELS, DUKE'S CYCLE, NORCO PRODUCTS LTD., RYDER DISTRIBUTION INC., THE GOVERNMENT OF THE KINGDOM OF THAILAND, BICICLETAS MERCURIO, S.A. DE C.V., ITALCYCLE INC., BICYCLE TRADE ASSOCIATION OF CANADA, THE GOVERNMENT OF THE UNITED MEXICAN STATES, GIANT CHINA CO. LTD., THE GOVERNMENT OF TAIWAN, .243 RACING INC., THE GOVERNMENT OF THE REPUBLIC OF TURKEY, THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINA, THE GOVERNMENT OF THE REPUBLIC OF PHILIPPINES, THE GOVERNMENT OF THE SOCIALIST REPUBLIC OF VIETNAM, SMOOTH SHIFTING SPORTS, INC., BRANTFORD CYCLEPATH, BAYVIEW CYCLE CENTRE, INDEPENDENT BICYCLE DEALER ASSOCIATION, PRIMEAU VÉLO, CYCLES DEVINCI INC., ACCESSOIRES POUR VÉLO O.G.D. LTÉE and BICYCLE SPORTS PACIFIC Respondents Heard at Ottawa, Ontario, on February 2, 2006. Order delivered at Ottawa, Ontario, on February 10, 2006. REASONS FOR ORDER BY: M. NADON Date: 20060210 Docket: A-439-05 Citation: 2006 FCA 56 Present: NADON J.A. BETWEEN: CANADIAN TIRE CORPORATION, LIMITED Applicant and CANADIAN BICYCLE MANUFACTURERS ASSOCIATION, RALEIGH CANADA LIMITED, GROUPE PROCYCLE INC., A. MORDO AND SON LTD., YONG QI (CHANGZHOU) INDUSTRIAL CO., LTD., LIYANG (SHEN ZHEN) MACHINERY CO., LTD., LIYANG (VIETNAM) INDUSTRIES CO., LTD., SPECIALIZED BICYCLE COMPONENTS CANADA, INC., CERVÉLO CYCLES INC., GIANT MANUFACTURING CO., LTD., TAIWAN BICYCLE EXPORTERS' ASSOCIATION, KENTON BICYCLE CO., ACEBIKE BICYCLE CO., LTD., PRIDE INTERNATIONAL INC., CHINA BICYCLE ASSOCIATION, CHINA CHAMBER OF COMMERCE FOR IMPORT AND EXPORT OF MACHINERY AND ELECTRONIC PRODUCTS, BANGKOK CYCLE INDUSTRIAL COMPANY LIMITED, RETAIL COUNCIL OF CANADA, CANADIAN ASSOCIATION OF SPECIALTY BICYCLE IMPORTERS, TREK BICYCLE CORPORATION, CANNONDALE BICYCLE CORPORATION, GIANT BICYCLE CANADA INC., ASTRO ENGINEERING VIETNAM CO., LTD., ASAMA YUH JIUM INTERNATIONAL VIETNAM CO. LTD., ALWAYS CO., LTD., VIETNAM SHENG FA INTERNATIONAL CO., LTD., DRAGON BICYCLES VIETNAM CO. LTD., SYNDICAT DE MÉTALLOS, GENESIS CYCLE INC., LAIDLAW HOLDINGS INC./TO WHEELS, DUKE'S CYCLE, NORCO PRODUCTS LTD., RYDER DISTRIBUTION INC., THE GOVERNMENT OF THE KINGDOM OF THAILAND, BICICLETAS MERCURIO, S.A. DE C.V., ITALCYCLE INC., BICYCLE TRADE ASSOCIATION OF CANADA, THE GOVERNMENT OF THE UNITED MEXICAN STATES, GIANT CHINA CO. LTD., THE GOVERNMENT OF TAIWAN, .243 RACING INC., THE GOVERNMENT OF THE REPUBLIC OF TURKEY, THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINA, THE GOVERNMENT OF THE REPUBLIC OF PHILIPPINES, THE GOVERNMENT OF THE SOCIALIST REPUBLIC OF VIETNAM, SMOOTH SHIFTING SPORTS, INC., BRANTFORD CYCLEPATH, BAYVIEW CYCLE CENTRE, INDEPENDENT BICYCLE DEALER ASSOCIATION, PRIMEAU VÉLO, CYCLES DEVINCI INC., ACCESSOIRES POUR VÉLO O.G.D. LTÉE and BICYCLE SPORTS PACIFIC Respondents REASONS FOR ORDER [1] On February 10, 2005, the Canadian International Trade Tribunal (the "CITT") commenced a Global Safeguard Inquiry into the importation of bicycles and finished painted bicycle frames, following a complaint brought by the respondents herein who alleged that the said bicycles and painted bicycle frames were being imported into Canada in such increased quantities and under such conditions as to cause or threaten serious injury to domestic producers of like or competitive goods. [2] Following its investigation into the matter, the CITT, on September 1, 2005, issued a Report containing its determinations and recommendations. More particularly, the CITT concluded that the increase in imported bicycles was the principal cause of the serious injuries suffered by the domestic producers of like or directly competitive goods. As a result, the CITT recommended to the Department of Finance that it impose a surtax set at 30% in the first year of application, 25% in the second year, and 20% in the third year. [3] On September 29, 2005, the applicant, Canadian Tire Corporation ("Canadian Tire"), commenced a judicial review application in respect of the CITT's Report and on October 31, 2005, it filed the affidavit of William C. Dovey in support of its application.. [4] On November 18, 2005, the respondents filed a motion for an order striking out the said affidavit in its entirety. [5] The Dovey affidavit is comprised of 45 paragraphs. After outlining his qualifications and experience (paragraphs 1 to 4), Mr. Dovey sets out the scope of the opinion which he intends to give (paragraphs 5 to 8), with a qualification of that opinion (paragraph 9). He then provides, at paragraph 10, his summary comments and conclusions. He then sets out, at paragraphs 11 through 42, his approach and analysis. Finally, at paragraph 43, he sets out the specific findings which lead him to conclude as he does. [6] For the present purposes, it will suffice for me to reproduce paragraphs 8, 9, 10 and 43 of the affidavit: 8. In the context of the above, I was asked to address and answer from a financial and accounting point of view the following questions: Are the determinations and recommendations by the Tribunal concerning bicycles pursuant to the Global Safeguard Inquiry consistent with and supported by the financial evidence and information set out in the Tribunal Report? 9. My opinions and comments are qualified because the scope of my review was limited to the financial and other information set out in the Tribunal Report. I understand that the Tribunal had significant additional financial information available to it that is not now available to me. I am not able to determine the extent to which such additional information, were it available to me, would have impacted on my observations and opinions set out herein. 10. Based on the scope of my review and subject to the assumptions, qualifications and restrictions noted herein, my conclusions are as follows: a) The financial evidence and information set out in the Tribunal Report is contradictory to and not supportive of certain of the Tribunal's determinations; b) There are alternative conclusions one can draw from the financial evidence and information set out in the Tribunal Report. [...] 43. Set out below are my summary findings based on the scope of my review and subject to the assumptions and restrictions noted herein: i) The rate of growth in imports slowed over the five year period under review. ii) Based on certain measures, the financial condition of domestice producers improved over the period 2000 to 2004. The improvement in gross margin percentage and reduction in losses between 2000 and 2004 suggests improvement in the overall financial condition of domestic producers despite increases in imports. iii) The domestic producers may not have had the capacity to supply the domestic market if imports were substantially reduced. iv) There is no support in the Tribunal Report for an assumption that, had the imports not increased, the domestic producers are now capable of a substantial production increase while maintaining existing profitability. v) Factors other than the volume of and rate of increase in imports may be the drivers of domestic production, sales and profit. [7] For the reasons that follow, it is my view that there can be no doubt whatsoever that the affidavit must be struck in its entirety. [8] To begin with, it is clear that the Dovey affidavit constitutes opinion evidence, the purpose of which is to demonstrate to this Court that the conclusions reached by the CITT in its Report and, in particular, that the increase in the number of bicycles and finished painted bicycle frames into Canada is a principal cause of the serious injury caused to the domestic market, are not supported by, nor are they consistent with the financial evidence and information contained in the CITT Report. [9] Recently, in Ly v. Canada(Minister of Citizenship and immigration), 2003 FC 1184, dated October 10, 2003, Mr. Justice von Finkenstein, in the context of an application for judicial review of a decision of the Appeals Division of the Immigration and Refugee Board, correctly, in my view, dealt with the nature of affidavits that could be filed in support of a judicial review application. At paragraph 10 of his Reasons, the learned Judge expressed his view as follows: [10] Except on motions, affidavits shall be confined to facts within the personal knowledge of the deponent: Rule 81(1), Federal Court Rules, 1998. The affidavit must be free from argumentative materials and the deponent must not interpret evidence previously considered by a tribunal or draw legal conclusions (Deigan v. Canada (A.G.) (1996), 206 N.R. 195 (Fed. C.A.); West Region Tribal Council v. Booth (1992), 55 F.T.R. 28; First Green Park Pty. Ltd. v. Canada(A.G.), [1997] 2 F.C. 845). If an affidavit does not meet these requirements, the application can only succeed if an error is apparent on the face of the record (Turcinovica v. Canada (M.C.I.), 2002 F.C.T. 164). [10] In Deigan v. Canada, supra, to which Mr. Justice von Finkenstein refers in support of his view, this Court agreed that the Motions Judge was correct in striking out certain paragraphs of the affidavit at issue on the grounds that these paragraphs were tendentious, opinionated and argumentative. [11] Although I agree with counsel for the applicant that certain paragraphs of Mr. Dovey's affidavit are factual statements and not opinion, they cannot be dissociated from the paragraphs which, in effect, constitute Mr. Dovey's opinion. Further, some of the paragraphs, namely paragraphs 1 to 4, which set out Mr. Dovey's qualifications and experience, are of no use to this Court on their own. Indeed, the true purpose of the Dovey affidavit is not to present facts for consideration of the Court, but to present facts which are already within the existing record so as to argue that the conclusions reached by the CITT are not justified. Paragraph 8 of Mr. Dovey's affidavit, which I again reproduce, makes that perfectly clear: 8. In the context of the above, I was asked to address and answer from a financial and accounting point of view the following questions: Are the determinations and recommendations by the Tribunal concerning bicycles pursuant to the Global Safeguard Inquiry consistent with and supported by the financial evidence and information set out in the Tribunal Report? [12] In other words, the purpose of the affidavit is to provide to this Court an assessment of the evidence which differs from that made by the CITT. That evidence is, in my view, not admissible in this judicial review application. [13] Another reason for striking the Dovey affidavit is that it constitutes evidence that was not before the CITT when it issued its Report. Allowing the introduction of the affidavit would have the effect of transforming the application before this Court into a de novo application. Were I to conclude that the affidavit is admissible, I would then have to grant, if they so wished, leave to the respondents to file their own "expert" affidavits in response to that of Mr. Dovey. The parties would most certainly proceed to discovery and file the transcripts of the evidence adduced thereat. In the end, this Court would be called upon to decide the issues raised by the judicial review application on evidence which the CITT had never considered. [14] In any event, as Mr. Justice MacKay of the Federal Court stated in Vancouver Island Peace Society v. Canada, [1994] 1 F.C. 102, at paragraphs 56 and 57 of his Reasons, the issues which arise in judicial review proceedings are generally of a legal nature and not issues of a scientific or technical nature in respect of which the Court is in need of help from experts. [15] For these reasons, I will allow, with costs, the respondents' motion to strike the Dovey affidavit in its entirety. [16] There remains one issue to be dealt with. At the end of their arguments, the parties informed me that Canadian Tire had not yet filed its Application Record and that, as a result, the time to do so had elapsed. The respondents were in agreement with Canadian Tire that the delay to file the Application Record should be extended. However, the respondents were of the view that a delay of 20 days was sufficient, while Canadian Tire requested a delay of 45 days. In the circumstances, I am prepared to give Canadian Tire an additional 45 days to file its Application Record. "M. Nadon" J.A. FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-439-05 STYLE OF CAUSE: Canadian Tire Corp., Ltd. v. Cdn. Bicycle Manufacturers Assoc. et al PLACE OF HEARING: Ottawa, Ontario DATE OF HEARING: February 2, 2006 REASONS FOR ORDER BY: Nadon J.A. DATED: February 10, 2006 APPEARANCES: Mr. Riyaz Dattu FOR THE APPLICANT Mr. Martin G. Masse Mr. Keith Cameron FOR THE RESPONDENTS SOLICITORS OF RECORD: McCarthy Tétrault Barristers & Solicitors Toronto, ON FOR THE APPLICANT Lang Michener LLP Barristers & Solicitors Ottawa, ON FOR THE RESPONDENTS