In Mars Canada Inc. v Bemco Cash & Carry Inc., the Ontario Divisional Court held that it did not have jurisdiction to hear an appeal where the court below directed a reference to a Master to fix damages, which had yet to be determined, and the claim for damages was for more than $50,000. The Divisional Court found that where damages remain to be determined, the order is to be treated as an order for more than $50,000 for purposes of determining jurisdiction under section 19 of the Courts of Justice Act (“CJA”).
The parties were in prior litigation with each other in which Mars Canada Inc. (“Mars”) claimed that Bemco Cash & Carry Inc. (“Bemco”) infringed its Canadian registered trademarks by selling in Canada Mars brand candy products purchased in the USA. The prior litigation was settled under terms that provided that Bemco would not engage in the impugned conduct.
In this action, Mars sued Bemco for breaching the settlement agreements. Mars moved for summary judgment and was granted an order that, among other things, included an order for a reference before a Master to fix damages owed by Bemco to Mars. Bemco purported to appeal the order to the Divisional Court, challenging the finding that the settlement agreements were enforceable, the reference to the Master, and the costs award.
Divisional Court does not have jurisdiction
Bemco argued that the Divisional Court had jurisdiction to hear the appeal under s. 19(1.2)(a) of the CJA because the judge did not fix the amount of damages and the amount could be less than $50,000. The Divisional Court rejected this argument and held that, where damages are indeterminate, that is, remain to be determined, and the claim for damages is for more than $50,000, then the order is to be treated in the same manner as an order dismissing a claim for more than $50,000. The Divisional Court noted that, as a practical matter, this will mean that judgments where references are directed will almost always have to be appealed to the Court of Appeal.
The Divisional Court rejected the argument that the Court should look at the underlying facts of the case and make a determination of the damages likely to be awarded on the reference. The Court held that such an approach “flies in the face of the principles established in the jurisprudence for determining appellate jurisdiction: one looks to the order. If the order falls within the jurisdiction of the Divisional Court, then the appeal is to this court. If it does not, either because it is clearly outside the jurisdiction of this court or because it cannot be determined that it is within the jurisdiction of this court, then the appeal is to the Court of Appeal.”
The Divisional Court quashed the appeal and exercised its jurisdiction to transfer the appeal to the Court of Appeal pursuant to s. 110 of the CJA.