Judgments

[1993] 1 F.C. 319

A-627-91

Thomas J. Lipton Inc. (Appellant)

v.

Ault Foods Ltd./Les Aliments Ault Ltée and the Registrar of Trade-marks (Respondents)

Indexed as: Ault Foods Ltd. v. Canada (Registrar of Trade Marks) (C.A.)

Court of Appeal, MacGuigan, Linden and Robertson JJ.A.—Toronto, November 27; Ottawa, December 1, 1992.

Trade marks — Registration — Opposition — Appeal from trial judgment directing Registrar to consider request to extend time to file opposition — Due to bureaucratic bungling, timely request for extension of time to oppose trade mark not reaching Opposition area before trade mark allowed as unopposed — Trade-marks Act, s. 39 requiring Registrar to allow application for registration if not opposed and time for filing statement of opposition expired — No opposition or opposition decided in favour of applicant essential precondition to allowance under s. 39 — Silverwood Industries Ltd. v. Registrar of Trade Marks, holding no statutory power to rescind Registrar’s erroneous decision, overruled.

This was an appeal from an order of Rouleau J. quashing the decision of the Registrar of Trade Marks and requiring him to consider the request for an extension of time to file a statement of opposition. The appellant filed an application to register “I can’t believe it’s not butter” as a trade mark. One day prior to the expiry of the 30-day limitation period for the filing of statements of opposition, the Toronto District Office of the Department of Consumer and Corporate Affairs received a letter from an agent of the respondent requesting a three-month extension of time for filing a statement of opposition. Due to inexcusable bureaucratic bungling, this letter was not brought to the Registrar’s attention until after the application had been allowed as unopposed. The issue was the meaning of Trade-marks Act, subsection 39(1) which provides that when an application for registration of a trade mark has not been opposed and the time for filing a statement of opposition has expired, the Registrar shall allow it.

Held, the appeal should be dismissed.

The use of “has not been opposed” in subsection 39(1), and the case law indicates that it is a precondition to the allowance of an application for registration that there has been no opposition, or that an opposition has been decided in favour of the applicant. In this context, there is no distinction between a completed opposition and a notice of intention to oppose coupled with a request for an extension. Extensions of time are permitted by subsection 47(1), and are expressly provided for, even on an out-of-time basis, by subsection 47(2). The opposition herein was not out-of-time, but even if it had been, the Registrar may not proceed to allowance before first dealing with outstanding applications for extension of time for opposition. The Registrar’s office must be organized so as to ensure that he has actual knowledge of every opposition or request for extension before allowance. On the basis of fairness, the respondent had a right to have its application for an extension of time considered by the Registrar before his decision on allowance of the trade mark.

Silverwood Industries Ltd. v. Registrar of Trade Marks, wherein it was held that there was no power to rescind or vary the Registrar’s decision because of error or other reasons, had to be overruled.

STATUTES AND REGULATIONS JUDICIALLY CONSIDERED

Trade-marks Act, R.S.C., 1985, c. T-13, ss. 38, 39, 47, 57.

CASES JUDICIALLY CONSIDERED

APPLIED:

Nicholson v. Haldimand-Norfolk Regional Board of Commissioners of Police, [1979] 1 S.C.R. 311; (1978), 88 D.L.R. (3d) 671; 78 CLLC 14,181; 23 N.R. 410; Martineau v. Matsqui Institution Disciplinary Board, [1980] 1 S.C.R. 602; (1979), 106 D.L.R. (3d) 385; 50 C.C.C. (2d) 353; 13 C.R. (3d) 1 (Eng.); 15 C.R. (3d) 315 (Fr.); 30 N.R. 119; Rust-Oleum Corp. v. Reg. T.M. (1986), 8 C.I.P.R. 1; 9 C.P.R. (3d) 271; 3 F.T.R. 113 (F.C.T.D.); Centennial Grocery Brokers Ltd. v. Registrar of Trade Marks, [1972] F.C. 257; (1972), 5 C.P.R. (2d) 235 (T.D.); Max Factor & Co. v. Registrar of Trade Marks (1982), 60 C.P.R. (2d) 158 (F.C.T.D.); Oakwood Development Ltd. v. Rural Municipality of St. François Xavier, [1985] 2 S.C.R. 164; (1985), 20 D.L.R. (4th) 641; [1985] 6 W.W.R. 147; 36 Man. R. (2d) 215; 18 Admin. L.R. 59; 31 M.P.L.R. 1; 61 N.R. 321; 37 R.P.R. 101; Tabi International Inc. v. Reg. of Trade Marks (1987), 17 C.I.P.R. 265; 17 C.P.R. (3d) 572; 14 F.T.R. 158 (F.C.T.D.); Uniroyal Ltd. v. Canada (Registrar of Trade Marks), [1987] 2 F.C. 124; (1986), 12 C.P.R. (3d) 376; 7 F.T.R. 149 (T.D.); Fruit of the Loom, Inc. v. Registrar of Trade Marks et al. (1986), 12 C.P.R. (3d) 381; 7 F.T.R. 239 (F.C.T.D.).

OVERRULED:

Silverwood Industries Ltd. v. Registrar of Trade Marks, [1981] 2 F.C. 428; (1980), 65 C.P.R. (2d) 169 (T.D.).

CONSIDERED:

Fjord Pacific Marine Industries Ltd. v. Registrar of Trade Marks, [1975] F.C. 536; (1975), 20 C.P.R. (2d) 108 (T.D.).

REFERRED TO:

In re Schmitz, [1972] 1 F.C. 1351; (1972), 31 D.L.R. (3d) 117 (Cit. App. Ct.); Professional Institute of the Public Service v. Treasury Board, [1977] 1 F.C. 304 (T.D.); Re Germain and Malouin et al. (1977), 80 D.L.R. (3d) 659 (F.C.T.D.); Lodge v. Minister of Employment and Immigration, [1979] 1 F.C. 775; (1979), 94 D.L.R. (3d) 326; 25 N.R. 437 (C.A.); Lokeka v. Minister of Employment and Immigration et al. (1986), 6 F.T.R. 85 (F.C.T.D.).

AUTHORS CITED

Wade, H. W. R. Administrative Law, 6th ed., 1988.

APPEAL from order (Ault Foods Ltd. v. Canada (Registrar of Trade Marks) (1991), 36 C.P.R. (3d) 499; 48 F.T.R. 1 (F.C.T.D.)) quashing Registrar of Trade Marks decision and requiring consideration of request for extension of time to file statement of opposition. Appeal dismissed.

COUNSEL:

W. Ian Binnie, Q.C. and William H. Richardson for appellant.

Douglas N. Deeth for respondent Ault Foods Ltd./Les Aliments Ault Ltée.

No one appearing for respondent Registrar of Trade Marks.

SOLICITORS:

McCarthy, Tétrault, Toronto, for appellant.

Blake, Cassels & Graydon, Toronto, for respondent Ault Foods Ltd./Les Aliments Ault Ltée.

Deputy Attorney General of Canada for respondent Registrar of Trade Marks.

The following are the reasons for judgment rendered in English by

MacGuigan J.A.: This is an appeal from an order of Rouleau J. on June 20, 1991, reported at (1991), 36 C.P.R. (3d) 499 (F.C.T.D.), sub nom. Ault Foods Ltd. v. Canada (Registrar of Trade Marks), by which the learned Trial Judge quashed by way of certiorari a decision of the Registrar of Trade Marks (“the Registrar”) and issued a writ of mandamus directing the Registrar to consider the respondent’s request for an extension of time in which to file a statement of opposition.[1]

The relevant provisions of the Trade-marks Act, R.S.C., 1985, c. T-13 (“the Act”), are as follows:

38. (1) Within one month from the advertisement of an application for the registration of a trade-mark, any person may, on payment of the prescribed fee, file a statement of opposition with the Registrar.

...

39. (1) When an application for the registration of a trade-mark either has not been opposed and the time for the filing of a statement of opposition has expired or it has been opposed and the opposition has been decided finally in favour of the applicant, the Registrar thereupon shall allow it.

(2) The Registrar shall not extend the time for filing a statement of opposition with respect to any application that has been allowed.

...

47. (1) If, in any case, the Registrar is satisfied that the circumstances justify an extension of the time fixed by this Act or prescribed by the regulations for the doing of any act, he may, except as in this Act otherwise provided, extend the time after such notice to other persons and on such terms as he may direct.

(2) An extension applied for after the expiration of the time fixed for the doing of an act or the time extended by the Registrar under subsection (1) shall not be granted unless the prescribed fee is paid and the Registrar is satisfied that the failure to do the act or apply for the extension within that time or the extended time was not reasonably avoidable.

...

57. (1) The Federal Court has exclusive original jurisdiction, on the application of the Registrar or of any person interested, to order that any entry in the register be struck out or amended on the ground that at the date of the application the entry as it appears on the register does not accurately express or define the existing rights of the person appearing to be the registered owner of the mark.

I

The appellant filed an application for the trade mark “I can’t believe it’s not butter” on November 9, 1989, based on proposed use in association with a vegetable oil spread, and it was advertised in the Canadian Trade Marks Journal on August 29, 1990.

By letter addressed to the Registrar and dated September 28, 1990, and received the same day by the Toronto District Office of the Department of Consumer and Corporate Affairs (one day prior to the expiry of the 30-day limitation period for the filing of statements of opposition in section 38 of the Act), an agent of the respondent requested a three-month extension of time for the filing of a statement of opposition. The appellant raised two contentions with respect to this letter: that it indicated no clear intention to file a statement of opposition and that it was not properly served upon the Registrar.

The relevant part of the text of this letter to the Registrar is as follows (Appeal Book, at page 10):

We respectfully request an extension of time of three months (to December 29, 1990) to oppose the within application. The undersigned requires the additional time to review the file history and to seek instructions from the opponent.

Because the three-month extension of time was requested “to oppose the within application”, I interpret the letter as a clear indication of an intention to oppose. I do not consider the instructions to be sought from the prospective opponent as relating to whether or not to oppose, but rather as having to do with the phrasing of the opposition. Of course, the respondent could always decide not to proceed, but it could also do so even if the letter had contained an actual statement of opposition rather than a request for an extension. The Court must be guided by the intention as expressed at the time.

As for the delivery, it was common ground that the Registrar’s Office is a part of the Department of Consumer and Corporate Affairs in Ottawa, and that the Registrar has no separate Toronto location. The letter of September 28 was addressed to the Registrar and was accepted by the Department in Toronto. It was in fact received by the Trade Marks Office in Ottawa on October 3, payment of the accompanying $50 fee was processed on October 22, and the letter was reviewed on October 23. At no time did the Registrar raise any issue as to improper delivery, and I can conclude only that the Registrar constructively received the letter, through the good offices of the government department with which he is associated, on September 28, 1990.

Despite the fact that the request for an extension of time was thus received on September 28 and reviewed on October 23, it did not come to the attention of the person within the office making the decision as to the allowance of the trade mark before the decision to that effect on October 26. Subsequently, on November 23, 1990, the respondent received a letter from the Chairman of the Trade Marks Opposition Board as follows (Appeal Book, at page 11):

Receipt is acknowledged of your letter dated September 28, 1990 requesting an extension of time within which to oppose application No. 643,903.

Unfortunately, your letter did not reach the Opposition area until after the above-referenced application had proceeded to allowance. A photocopy of the Office letter of October 26, 1990 in enclosed for your information.

In view of the decisions of the Federal Court of Canada in Silverwood Industries Ltd. v. Registrar of Trade Marks (1980), 65 C.P.R. (2d) 169 and Uniroyal Ltd. v. Registrar of Trade Marks (1986), 12 C.P.R. (3d) 376, I am unable to consider your request for an extension of time.

The $50 fee enclosed with your letter will be refunded in due course.

The upshot is that by an inexcusable and apparently not unprecedented bureaucratic bungle the Registrar allowed a trade mark on the basis that it was unopposed without having taken account of a request for an extension of time to oppose it. In such circumstances, who should bear the loss—apart from the Registrar, whose liability, if any, may fall to be decided in subsequent proceedings?

II

Although the November 24 letter to the respondent does not so indicate, the Trial Division precedents appear to be in disagreement as to the appropriate result.

In Silverwood Industries Ltd. v. Registrar of Trade Marks, [1981] 2 F.C. 428 (T.D.), where a prospective registrant had brought an application for a mandamus against the Registrar, the Trial Judge said (at pages 428-429):

I cannot accept the submission that a request for an extension of time must be taken to be the commencement of opposition proceedings. A request of that kind may be granted or refused.

Here the request was not acted upon until far too late. At that time subsection 38(2) [now subsection 39(2)], unfortunately, came into play. There is no power, as in some statutes such as the Unemployment Insurance Act, 1971 [S.C. 1970-71-72, c. 48], to rescind or vary because of error or other reasons, a decision previously made by the Registrar of Trade Marks.

I hold the decision to allow the application was not a nullity. It stands. The Registrar cannot now purport to permit opposition proceedings by any one of the letters of August 21, 1980, extending the time. He at this stage has no jurisdiction to do so. There will be an order in the nature of prohibition forbidding him to do so.

This is also, in my view, a proper case for relief in the nature of mandamus. The Registrar has received the declaration of use requested. Provided that declaration meets the Registrar’s requirements, he is required by way of mandamus to register the applicant’s trade mark, and to issue the appropriate certificate of registration.

In Uniroyal Ltd. v. Canada (Registrar of Trade Marks), [1987] 2 F.C. 124 (T.D.), a case on all fours with the present case, Rouleau J., on the other hand, distinguished Silverwood on the ground that no letter seeking an extension of time had been filed within the prescribed one-month period. He therefore felt free to allow prerogative relief (at pages 129-130):

I am satisfied that the Registrar’s decision in these circumstances was purely administrative and he had a duty to act fairly in exercising his powers.

The administrative decision-maker must consider and take into account all relevant factors. Though I am satisfied that the Registrar has no jurisdiction under the Trade Marks Act to suspend the application for the allowance of the trade mark, this Court has that discretionary power.

In situations where discretionary powers are exercised without having regard to all relevant facts or where there may be an error on the fact of the record, or there exists a procedural irregularity which eventually had an influence on the final determination made by the decision-maker, the exercise of that discretion should be subject to review by the Court in its supervisory capacity. If the disregard for the facts or the overlooking of some procedure was a relative factor in determining the outcome, the Court, should exercise its discretion and set aside the decision or order.

Rouleau J. followed his own decision in Uniroyal in Fruit of the Loom, Inc. v. Registrar of Trade Marks et al. (1986), 12 C.P.R. (3d) 381 (F.C.T.D.) and in the case at bar. However, his original distinction of Silverwood proved to be untenable and he revised it in the present case as follows (at pages 503-504):

Upon rereading the Silverwood decision, I note that there is an allusion, albeit cursory, to the letter of request being filed prior to allowance, contrary to my remarks in Uniroyal. Nevertheless, I am not satisfied that this would change the conclusion in Uniroyal. The Court in Silverwood was faced with an application to enforce a statutorily imposed duty under s. 38(2) (now 39(2)) of the Act; it was not concerned with an application by the party filing the opposition to overturn the decision. Collier J. may have hinted at this when he said [at pp. 170-71]:

I see no reason for me to, in effect, say anything about, or to preserve in any way, the right of any other persons. It seems to me the legal consequences will flow from my order. Parties such as McDonald’s will have to seek their own advice.

In my opinion, nothing prevents the aggrieved party from seeking to have the decision of the Registrar overturned as having been taken in the absence of relevant factors, i.e. a duly filed letter of intent to oppose. I conclude that the decision in Uniroyal was therefore correct and is determinative of the present application.

Uniroyal was also followed by Cullen J. in Tabi International Inc. v. Reg. of Trade Marks (1987), 17 C.I.P.R. 265 (F.C.T.D.), where the request for an extension of time for opposition was made retroactively, but before the Registrar had acted on the allowance.

It is, of course, important to note that the mandamus granted by the learned Trial Judge did not order the Registrar to grant the extension of time, but only to consider it.

III

The issues, as defined by the appellant, relate to the scope of judicial review and to the correct interpretation of the statute.

In its judicial review contention, the appellant relied upon the following caveat from H. W. R. Wade, Administrative Law, 6th ed., 1988, at page 38:

Nevertheless the limits to the court’s function in judicial review proceedings must be remembered. The courts review the legality of action; they do not exercise a roving commission to scrutinise and then quash any action or decision of which they disapprove, or which they may feel does injustice to the complainant. Hence the distinction between the role of a court reviewing legality and that of an appellate court hearing an appeal on its merits is most evident.

It seems clear to me that there can be no contest as to the accuracy of this statement. In particular, it is evident that courts may not use the prerogative writs to amend legislation. But once it is accepted that the courts may review even administrative decisions on the basis of fairness (Nicholson v. Haldimand-Norfolk Regional Board of Commissioners of Police, [1979] 1 S.C.R. 311; Martineau v. Matsqui Institution Disciplinary Board, [1980] 1 S.C.R. 602), which is enough for the present case where the respondent’s challenge was on the basis of fairness,[2] the real question in the case at bar becomes one of statutory interpretation. I find the issue of the scope of judicial review something of a red herring in the present context, since that scope, as I see it, depends upon the meaning of the statute.

In my view, a good starting point is to be found in the dictum of Teitelbaum J. in Rust-Oleum Corp. v. Reg. T.M. (1986), 8 C.I.P.R. 1 (F.C.T.D.) at page 5, that the Act is to be read as a whole rather than as a series of discrete parts:

No section of the Trade Marks Act is to be interpreted on its own. In order to find the true meaning of any words of a particular section of the Act, it is imperative that all sections of the Act relating, directly or indirectly, to the section to be interpreted must be considered.

Heald J. (as he then was) in Centennial Grocery Brokers Ltd. v. Registrar of Trade Marks, [1972] F.C. 257 (T.D.), had to deal with whether an applicant for registration could require the Registrar to register his mark without considering an opposition when the notice of application had been filed out-of-time. Heald J. wrote (at pages 259-260):

Applicant here is in effect arguing that the combined effect of section 38(1) and (2) [now 39(1) and (2)] is that the Registrar must allow an application immediately after the time for opposition has expired unless within that time an opposition has been filed or a request for extension has been received.

With deference, I cannot give effect to this argument... In the case at bar, the application was made outside the 30 day period and such an application is surely contemplated under the provisions of section 46(2) [now 47(2)]. Fournier J. would seem to agree with this view where he says at page 313:

... After the expiration of the time fixed and up to the date on which a registration is allowed, the Registrar, in his discretion, may grant an extension of time, if he is satisfied that the circumstances justify such an extension.

Dr. Fox has dealt with this question in his Second Edition, Volume I, at page 367 as follows:

The meaning of the word “thereupon” contained in section 38(1) and section 39(1) does not necessarily require registration to be effected by the Registrar immediately.

This view was followed by Jerome A.C.J. in Max Factor & Co. v. Registrar of Trade Marks (1982), 60 C.P.R. (2d) 158 (F.C.T.D.) at pages 160-161:

[T]he applicant’s main premise on this application [was] that by virtue of s. 38(1) [now s. 39(1)], the Registrar, was at the moment of his refusal of the requested extension of time, under a statutory duty to “thereupon” allow the application.

...

In the circumstances of this case, I cannot conceive that this application could ever be considered by the Registrar to be unopposed, which obviously is one of the essential elements of s. 38(1) [now s. 39(1)].

In the light both of the statutory wording (“has not been opposed”) and of the authorities, I interpret subsection 39(1) to mean that it is an essential precondition of the Registrar’s allowing an application for registration that there has been no opposition (or, of course, alternatively, that an opposition has been decided in favour of the applicant).

I can make no distinction in this context between a completed opposition and a notice of intention to oppose coupled with a request for an extension. Extensions of time are not only provided for by subsection 47(1), but are expressly provided for even on an out-of-time basis by subsection 47(2). On my view of the facts there is nothing out-of-time in the opposition in the present case. Even if there were, Centennial Grocery and Tabi establish that the Registrar may not proceed to allowance before first dealing with outstanding applications for extension of time for opposition. Obviously, the Registrar’s office must be organized in such a way as to ensure that he has actual knowledge of every opposition or request for extension before allowance, but in this age of computerization that should be seen as an easily performed duty rather than as an onerous one. Even a more primitive system properly carried out could hardly fail to alert the Registrar in time.

In sum, on the basis of fairness, as found by the Trial Judge, the respondent had a right to have its application for an extension of time considered by the Registrar before his decision on allowance of the trade mark. As Wilson J. put it for the Supreme Court in Oakwood Development Ltd. v. Rural Municipality of St. François Xavier, [1985] 2 S.C.R. 164, at page 175, a statutory decision maker must “be seen to have turned its mind to all the factors relevant to the proper fulfilment of its statutory decision-making function.” The potential unfairness which the appellant claimed would be the result of a decision against it, even if true, could not be placed on the same footing as the unfairness in procedure the Registrar committed against the respondent.

The appellant argued as well that the scheme of the Act as enacted by Parliament provided for relief in such situations through expungement proceedings under section 57.[3] However, such proceedings must be brought in the Federal Court, with all the consequences that that entails, rather than in a summary way before the Registrar. This does not appear to me to be a statutory alternative.

In the result, Silverwood must be overruled, and the appeal dismissed with costs.

Linden J.A.: I agree.

Robertson J.A.: I agree

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