Federal Court of Appeal Reiterates Permissive Approach to Granting Leave to Amend Defective Pleadings

In Bell Canada et al. v. Millennium Funding, Inc. et al., 2025 FCA 153, Bell Canada and Bell Aliant (collectively, “Bell”) appealed an order granting the Respondents’ (collectively, “Millenium Producers”) motion to strike parts of Bell’s pleading, without leave to amend. The appeal raised three issues: the sufficiency of Bell’s copyright misuse defence, whether Bell should have been given leave to amend, and the fate of secondary allegations against the producers, their counsel, and related requests for declaratory relief.

The Federal Court of Appeal held that the Federal Court made no error except as it relates to denying leave to amend. Ultimately, Bell was granted leave to amend its pleadings to rectify the defects noted by the appellate court.

The Millennium Producers commenced an action against Bell in relation to their copyright in five films. The Millennium Producers alleged that Bell, as the internet service provider (“ISP”), failed to comply with the notice and notice regime under the Copyright Act. Specifically, the film producers alleged that Bell failed to forward over 40,000 infringement notices to potential defendants over a 28-month period. Bell counterclaimed, arguing that the producers’ copyright enforcement program misused the notice regime to intimidate users and extract inflated settlements from ISPs.

At first instance, the case management judge struck Bell’s pleadings in their entirety, without leave to amend. The Federal Court upheld that decision, finding that Bell had not pleaded sufficient material facts and had failed to rectify defects raised by the Millennium Producers and to indicate how the deficiencies would be cured.  

The Federal Court of Appeal (the “Court”) acknowledged that Bell’s pleadings lacked sufficient detail but determined that they were not beyond repair. In principle, improper use of the notice regime could support a viable copyright misuse defence.

On the question of leave to amend, the Court reiterated that the legal test is well-established: leave to amend may be denied only if it is plain and obvious that the defect cannot be cured by amendment. This high threshold reflects the “very serious consequences” of denying leave and demonstrates that such a step “should not be taken lightly”.

Citing Michel v Canada (Attorney General), 2025 FCA 58, the Court noted that, when a defect stems from insufficient material facts, leave to amend should be granted unless the party has already been given so many chances to amend that the court concludes they are unable to plead the required facts. 

The Federal Court “did not apply these principles”, and instead, denied leave because Bell had not addressed deficiencies identified by the Respondents. In so doing, the Federal Court erred in law by failing to consider the circumstances as a whole and to determine whether the defects “could possibly” be cured.

The Court’s decision reinforces a generous approach to granting leave to amend defective pleadings. Parties will generally be permitted leave to amend, unless it is “plain and obvious” that the defects cannot be cured.