Date: 20090317
Docket: A-193-08
Citation: 2009 FCA 88
CORAM: RICHARD
C.J.
LÉTOURNEAU J.A.
LAYDEN-STEVENSON
J.A.
BETWEEN:
SC PRODAL 94 SRL
Appellant
and
SPIRITS INTERNATIONAL B.V.
and
REGISTRAR OF TRADE-MARKS
Respondents
REASONS FOR JUDGMENT OF THE
COURT
(Delivered from the Bench at Ottawa, Ontario, on March 17, 2009)
LAYDEN-STEVENSON J.A.
[1] We
are all of the view that the appeal should be allowed.
[2] The
respondent, Spirits International B.V. (Spirits) applied to the Federal Court,
pursuant to sections 57 and 58 of the Trade-marks Act, R.S.C. 1985, c.
T-13 (the Act) to expunge the 501, 347 ('347) trade-mark of the appellant, SC
Prodal 94 SRL (Prodal), from the register.
[3] Prodal’s
'347 mark “STALINSKAYA”, in association with alcoholic distilled beverages,
particularly vodka, was registered in Canada
on September 28, 1998. After submitting a fresh application for the trade-mark
“STALINSKAYA”, Appl. No. 1370400, on November 2, 2007, Prodal voluntarily
cancelled its '347 trade-mark on November 5, 2007. Consequently, when the
application came on for hearing on April 1, 2008, there was no mark on the
register.
[4] Although the '347 mark had been cancelled, the applications judge allowed
Spirits’ application. The judge went further and issued a declaration that the
trade-mark STALINSKAYA “was not distinctive because it is confusing with the
[Spirits] registered STOLICHNAYA trade-marks including registration TMA208,809
for use in association with vodka.” With respect to the pending application, the
applications judge ordered that “a stay of proceedings and a permanent
mandatory injunction is granted prohibiting the Registrar of Trade-marks from
considering trade-mark application STALINSKAYA, Appl. No. 1370400.” Lump sum
costs in the amount of $1,000 plus expert costs, disbursements and GST were
awarded to Spirits. No reasons were given for the order. No explanation for
the exercise of discretion to deal with an application that was otherwise moot
was provided.
[5] Section
57 of the Act enables the Registrar, or any person interested, to apply to the
Federal Court for an order to strike or amend any entry in the register 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. As noted, Spirits
sought to expunge the Prodal mark.
[6] That
which does not exist cannot be expunged. The applications judge allowed the
application and declared that Prodal’s trade-mark was not distinctive because
it is confusing with a Spirits mark. We express no opinion as to the propriety
of an order granting ancillary relief in circumstances where the primary relief
is not attainable. For reasons that will be discussed, we are of the view that
the declaration ought not to have been granted.
[7] The
applications judge also granted relief that cannot be characterized as being
ancillary to that requested in the notice of application. Specifically and
notwithstanding that there was no request for such relief in the notice of
application, the judge granted a stay of proceedings and a permanent mandatory
injunction “prohibiting the Registrar of Trade-marks from considering”
trade-mark application number 1370400.
[8] To
obtain a stay of proceedings, the tripartite test articulated in RJR-MacDonald
Inc. v. Canada (A.G.) (RJR), [1994] 1 S.C.R. 311 must be
satisfied. There was no evidence before the applications judge addressing the
constituent elements of the RJR test. Further, there was no argument
in this respect in the memorandum of fact and law of Spirits (Appeal Book,
Volume 6, pp. 1548-1574). The components of the RJR test are
conjunctive. Therefore, each must be satisfied in order to obtain a stay of
proceedings. The test was not satisfied in this case. In fact, it was not
addressed. There being no basis upon which to grant a stay of proceedings, the
applications judge erred in doing so.
[9] As
previously stated, the applications judge’s order also provides that “a
permanent mandatory injunction is granted prohibiting the Registrar of
Trade-marks from considering trade-mark application STALINSKAYA, Appl. No.
1370400.” With respect, the two remedies cannot co-exist.
[10] A
mandatory injunction requires one to act positively. It may be given to remedy
past wrongs requiring an individual to take the necessary steps to undo a wrong
committed, or it may look to the future and require an individual to carry out
some unperformed duty to act. A prohibitive injunction restrains an individual
from committing a specified act: Robert J. Sharpe, Injunctions and Specific
Performance 3rd ed. (Aurora:
Canada Law Book, 2000) at p. 1-1.
[11] Notably,
Spirits did not include a request for a stay of proceedings, a mandatory
injunction, or an order of prohibition in its notice of application. These
forms of relief were requested in its memorandum of fact and law. Spirits
claims that the “basket clause” in its notice of application wherein it
requested “such other relief as counsel may advise and this Honourable Court
deems just” is sufficient to encompass any and all of the relief requested in
its memorandum of fact and law. No authority was cited for the proposition
that the principle in Native Women’s Assn. of Canada v. Canada, [1994] 3
S.C.R. 627 (where declaratory relief that is necessarily ancillary to the
requested relief may be granted under a basket clause in circumstances where
the party opposite is not taken by surprise or prejudiced in any way) should be
extended to the granting of stays, mandatory injunctions or orders of
prohibition.
[12] Rule
301 of the Federal Courts Rules, SOR/98-106 (the Rules) mandates that a
notice of application shall contain a precise statement of the relief sought as
well as a complete and concise statement of the grounds intended to be argued,
including a reference to any statutory provision or rule to be relied on.
Spirits does not respond to Prodal’s submission that the requirements of Rule
301 were not met.
[13] After
it cancelled its mark, Prodal did not file a notice of appearance. Rule 145 of
the Rules provides that where a person has been served with an originating
document and has not filed a notice of appearance, no further documents in the
proceeding need be served on the person prior to final judgment unless the
Court orders otherwise. Therefore, Spirits did not serve Prodal with its
memorandum of fact and law.
[14] Leaving
aside the propriety of requesting the relief Spirits asked for in its
memorandum of fact and law, it is common ground that Prodal had no notice of
any of the requested relief, other than that in relation to the expungement of
its mark. Spirits was aware that Prodal had never used its trade-mark in
Canada as a result of Spirits’ unsuccessful appeal in relation to proceedings
under section 45 of the Act: Spirits International N.V. v. Canada (Registrar
of Trade-marks) (2006), 49 C.P.R. (4th) 196 (F.C.), aff’d.
(2007), 60 C.P.R. (4th) 31 (F.C.A.). Prodal claims it was unaware
of the applications judge’s order, until after the order was issued, and was
taken by surprise and prejudiced by it. Moreover, it contends that the
process, in the circumstances, was procedurally unfair.
[15] Rule 75 allows a party to apply to the court, at any time, to amend
a document on such terms as will protect the rights of all parties. We are of the view that, in
circumstances where a respondent party does not have notice of the relief being
requested, such relief should not be granted until notice is given and the
respondent party is offered the opportunity to respond. Failure to ensure the
provision of notice results in a process that is procedurally unfair. Here, it
was readily apparent that Spirits’ requested relief as set out in its notice of
application did not correspond with that contained in its memorandum of fact
and law.
[16] The
appeal will be allowed with costs and the order of the applications judge will
be set aside.
“C. Layden-Stevenson”
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