Docket: T-791-13
Citation: 2013 FC 1245
Ottawa, Ontario, December 11, 2013
PRESENT: The Honourable Mr. Justice Zinn
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BETWEEN:
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299614 ALBERTA LTD.
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Applicant
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and
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FRESH HEMP FOODS LTD.
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Respondent
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REASONS FOR JUDGMENT AND JUDGMENT
[1]
This is an appeal under section 56(1) of the Trade-marks
Act, RSC 1985, c T-13 [Act], of a decision by the Registrar of
Trade-marks [Registrar] to allow the Respondent’s trade-mark application and to
register the mark.
[2]
It is clear that the Registrar erroneously allowed and registered
the trade-mark because it thought that the opposition had been withdrawn, when
it had itself acknowledged receipt of the opposition evidence. As a
consequence, the Respondent was granted rights that it would not otherwise have
had, simply because of an error by the Registrar.
[3]
The determinative issue is whether this application was initiated
under the correct section of the Act. I find that these proceedings
have been improperly brought under section 56 of the Act and that the
only way to remove a trade-mark from the register is to initiate expungement
proceedings under section 57.
[4]
The relevant statutory provisions are sections 55,
56 and 57 of the Act:
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55. The Federal Court has jurisdiction to
entertain any action or proceeding for the enforcement of any of the
provisions of this Act or of any right or remedy conferred or defined
thereby.
56. (1) An appeal lies to the Federal
Court from any decision of the Registrar under this Act within two months from
the date on which notice of the decision was dispatched by the Registrar or
within such further time as the Court may allow, either before or after the
expiration of the two months.
…
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.
(2) No person is entitled to institute
under this section any proceeding calling into question any decision given by
the Registrar of which that person had express notice and from which he had a
right to appeal.
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55. La Cour fédérale peut connaître de toute
action ou procédure en vue de l’application de la présente loi ou d’un droit
ou recours conféré ou défini par celle-ci.
56. (1) Appel de toute décision rendue par
le registraire, sous le régime de la présente loi, peut être interjeté à la
Cour fédérale dans les deux mois qui suivent la date où le registraire a
expédié l’avis de la décision ou dans tel délai supplémentaire accordé par le
tribunal, soit avant, soit après l’expiration des deux mois.
…
57. (1) La Cour fédérale a une compétence
initiale exclusive, sur demande du registraire ou de toute personne
intéressée, pour ordonner qu’une inscription dans le registre soit biffée ou
modifiée, parce que, à la date de cette demande, l’inscription figurant au
registre n’exprime ou ne définit pas exactement les droits existants de la
personne paraissant être le propriétaire inscrit de la marque.
(2) Personne n’a le droit d’intenter, en
vertu du présent article, des procédures mettant en question une décision
rendue par le registraire, de laquelle cette personne avait reçu un avis
formel et dont elle avait le droit d’interjeter appel.
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[5]
The Applicant submits that the
decisions by the Registrar to allow the trade-mark application and subsequently
to register the trade-mark ought to be set aside, and the trade-mark removed
from the registry pursuant to subsection 56(1) and section 55 of the Act.
It submits that section 56 is the appropriate manner for proceeding because
the decisions to allow the trade-mark application and register the trade-mark
constitute decisions within the meaning of “any decision of the Registrar” as
set out in that section. It says that a proceeding under section 57 would not
be appropriate because s. 57(2) prohibits a proceeding under section 57 where
the applicant was given express notice of a decision of the Registrar and there
is a right of appeal. It says that having received notice of the decision on
March 15, 2013, and having not exhausted its right of appeal under section 56,
no claim can properly be brought under s. 57.
[6]
The Respondent submits that once a trade-mark is registered, it can only
be expunged under section 57: Sadhu Singh Hamdard Trust v Registrar of
Trade-Marks, 2007 FCA 355 at para 23 [Sadhu]. Expunging a
registered mark is not a remedy that is available under section 56. I agree.
[7]
The Federal Court of Appeal in Sadhu unambiguously stated at
paragraph 23 that “once the trade-mark is registered, it can only be challenged
on substantive grounds under section 57.” There is no right
of appeal under section 56 once the trade-mark is registered.
[8]
I do not accept the Applicant’s submission that
the previous decision of the Court of Appeal in Ault Foods Ltd v Canada
(Registrar of Trademarks), [1993] 1 FC 319 [Ault Foods] is on
all-fours with this case and permits the Court to set aside the Registrar’s
decision to accept and register the mark. As noted by the Respondent, it is
clear from paragraph 10 of the Reasons in Sadhu that while the trade-mark
application in Ault Foods had been accepted, the trade-mark had not yet
been registered. That is a significantly different situation than here where the
trade-mark has been registered.
[9]
Furthermore, as was noted by the Court of Appeal
in Sadhu at paragraph 24: “The differences between an appeal under
section 56 and an action for expungment under section 57 are real and
substantial.” Therefore, there are substantive reasons why a trade-mark should
only be struck from the register through proceedings under section 57. One
example that the Court in Sadhu provided is that the result of a section
57 proceeding is binding against the world, and not only binding as between the
parties.
[10]
Although it may be regrettable that the
Applicant has no cost-effective and expeditious way to correct the Registrar’s
error, section 56 of the Act simply does not provide this Court with
jurisdiction to remove a trade-mark from the register. That can only be done under
section 57.
[11]
The Applicant contends that it would be barred
from proceeding under section 57 by virtue of subsection 57(2) which reads: “No
person is entitled to institute under this section any proceeding calling into
question any decision given by the Registrar of which that person had express
notice and from which he had a right to appeal.” I agree with the Respondent
that there is no such impediment. Since there is no right to appeal under section
56 to begin with, subsection 57(2) would not operate to bar the Applicant from
initiating expungement proceedings.
[12]
The Respondent is entitled to its costs. The
Respondent asked the Court for an opportunity to make submissions on quantum
after this decision was rendered. It is understood that offers may have been
exchanged. The Respondent shall serve and file its written submissions as to
costs within fourteen (14) days and the Applicant shall have a further period
of seven (7) days to serve and file its reply.
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