Date: 20100416
Docket: A-382-09
Citation: 2010 FCA 104
CORAM: NOËL
J.A.
EVANS
J.A.
DAWSON
J.A.
BETWEEN:
MIRANDA ALUMINUM INC.
Appellant
and
MIRANDA WINDOWS & DOORS INC.
Respondent
REASONS FOR JUDGMENT
EVANS J.A.
[1]
This
litigation arises from an acrimonious dispute between a father and son over the
right to use the family’s surname, Miranda, in connection with selling and
installing aluminum windows, doors and other home renovation products. Both
draw their customers largely from the Portuguese community in the Greater
Toronto Area (GTA). The same parties are also engaged in a related passing-off
action in the Superior Court of Justice.
[2]
Miranda
Aluminum Inc., the father’s company, is appealing a decision of the Federal
Court (2009 FC 669) in which Justice Simpson dismissed the appellant’s application
under section 57 of the Trade-marks Act, R.S.C. 1985, c. T-13 (Act) to
expunge two trade-marks registered by Miranda Windows & Doors Inc., the
son’s company. The first is a word mark, Miranda, and the second a design mark,
Miranda surrounded by the simple outline of a house.
[3]
An
application to register both trade-marks was filed on February 20, 2006. The
word mark was registered on March 13, 2007, and the design mark on March 14,
2007. Both were registered for use in association with services that include
the custom design and installation of windows, doors and aluminum railings, and
home renovations.
[4]
Justice
Simpson’s dismissal of the application was based principally on five findings
of fact.
[5]
First,
Miranda is primarily a surname, and thus not registrable by virtue of paragraph
12(1)(a) of the Act. However, by the time that the son’s company applied
to register the marks on February 20, 2006, both had acquired distinctiveness
in connection with the products and services of the son and his company, and
thus could be registered under the exception in subsection 12(2).
[6]
Second,
the father had not established prior use of the name Miranda so as to warrant
expungement of the trade-marks under subsection 17(1) of the Act.
[7]
Third, in
1990, when the son first used the name Miranda in applying to register Miranda
Aluminum and Vinyl Products as the trade name of his first company, T.M.
Renovations Inc. (“TMR”), the public would not falsely have connected the name
Miranda with the father in association with the supply and installation of
aluminum products. Accordingly, she rejected the father’s argument that the
trade-mark should be expunged under paragraph 9(1)(k) of the Act.
[8]
Fourth, the
respondent’s application to register the marks stated that it had first used
the name Miranda at least as early as August 31, 1991. The marks were therefore
not liable to be expunged under section 18 on the ground of a material false
statement.
[9]
Fifth, the
father’s alleged use of the name Miranda in connection with the sale and
installation of aluminum products as of the date when he commenced the
expungement proceedings, July 16, 2007, had not caused the name to lose its
distinctiveness, and the registration of the marks was not invalidated by
paragraph 18(1)(b) of the Act.
[10]
It is
common ground that questions of law decided by the Judge are subject to review
on the standard of correctness. On the other hand, the Judge’s findings of
fact, and of mixed fact and law, may only be set aside on appeal if the
appellant establishes that they were vitiated by palpable and overriding error.
However, any question of law that is readily extricable from the Judge’s
determination of a question of mixed fact and law is reviewable for
correctness.
[11]
I would
only add that the teaching of the Supreme Court in Housen v. Nikolaisen,
2002 SCC 33, [2002] 2 S.C.R. 235, on the importance of appellate courts’
showing a large measure of deference to the findings of fact by a trial judge
is particularly salutary in a case such as this where, as counsel for the
appellant candidly stated, aspects of the conduct of the parties to this complex
and lengthy family feud are “very murky”.
[12]
The
appellant’s memorandum of fact and law raises three issues, which I shall deal
with in turn.
Issue 1: Did the
Judge err in finding that, when the respondent applied to register the marks on
February 20, 2006, it did not misrepresent the date of the first use of the
mark as August 31, 1991, or ealier?
[13]
The
registration of a trade-mark may be invalidated by a material misstatement in
the application, even if the misstatement was made innocently: General
Motors of Canada v. Décarie Motors Inc., [2001] 1 F.C. 665 (F.C.A.) (“General
Motors”) at para. 18.
[14]
The
appellant argues that the Judge erred in finding that the respondent could rely
on the earliest use of the name Miranda by the respondent’s first company, TMR,
as its predecessor in title. This is because, counsel submitted, TMR was
involuntarily dissolved on June 17, 2004, pursuant to section 240 of the Ontario
Business Corporations Act, R.S.O. 1990, chap. B-16, for failing to file
special notices, and all its rights, including any right to use the name
Miranda, were forfeited to and vested in the Crown under subsection 244(1).
[15]
TMR had
not assigned its rights to the use of the name Miranda to either the son or the
respondent prior to TMR’s dissolution. Nor was there any evidence that,
following TMR’s dissolution, the son had taken steps to revive the company by
promoting a private Act of the Ontario Legislature. Instead, counsel argued,
the first use of the name by the respondent could not have been earlier than
the date of its incorporation, March 2, 2005, fourteen years after August 31,
1991, the date stated in the application for registration of the marks.
[16]
Assuming,
without deciding, that the Judge erred in finding that 1991 was the date of
their earliest use by the respondent, I do not agree that the misstatement
warrants the expungement of the marks. This Court stated in General Motors
(at para. 18) that innocent misstatements will only invalidate a trade-mark if
they are material, in the sense that “without them, the section 12 barriers to
registration would have been insurmountable.” In my view, based on the Judge’s
findings of fact in the present case, there would have been no bar to the
registration of the marks on February 20, 2006, if the respondent had stated in
its application that their first use was in March 2005. Nor is there any
evidence that the appellant was prejudiced by the misstatement.
[17]
As I
understand it, counsel’s argument is that the respondent could not rely on its
use of the name because the right to use the name Miranda in connection with
the supply of vinyl products and related services had passed from TMR to the
Crown on June 17, 2004, on the dissolution of TMR. Hence, it is submitted, the
respondent’s use of the name Miranda after June 17, 2004, was unlawful and
cannot be relied on as establishing first use. In my opinion, this is a highly
technical and artificial argument that overlooks the essential realities of the
situation.
[18]
First,
TMR’s dissolution was involuntary and technical, resulting from its failure to
file special notices. It happened without the knowledge of the son, who
continued to operate the business, to use its registered trade name until March
2, 2005, when the respondent was incorporated, and to provide goods and
services to his customers as before.
[19]
Second,
the son was the directing mind of the corporations through which he conducted
his business. As the Judge found, the name acquired distinctiveness through the
services provided by the son and flowed through to his companies.
[20]
Third,
there is no evidence that the use of the name Miranda, after the dissolution of
TMR, by either the son or the respondent, caused any confusion in the minds of
members of the public about the identity of the source of the goods and
services being provided and advertised by the respondent. This, after all, is
the mischief at which the law of trade-marks is aimed: Mattel Inc. v. 3894207
Canada Inc., 2006 SCC 22, [2006] 1 S.C.R. 772 at para. 21.
[21]
Fourth, it
is not alleged that the Crown objected to, or was damaged by, the son’s
continuing use of the name Miranda, or to its subsequent use by the respondent.
[22]
Fifth,
counsel argued that the father was prejudiced by the misstatement because he
could have opposed the registration of the marks on the basis of his prior use
of the name in his businesses after 2000. However, as is explained further
below, the Judge rejected the father’s evidence relating to his prior use.
Consequently, he could have suffered no prejudice.
[23]
Hence,
whatever technical irregularity may have occurred regarding the declared date
of earliest use of the name does not, in my view, warrant the expungement of
the marks.
Issue 2: Did the
Judge err in finding that the name Miranda had acquired distinctiveness by
either February 20, 2006, when the respondent applied to register the marks, or
by July 17, 2007, when the appellant commenced the present proceedings?
(i) Use of the name Miranda by John
Miranda
[24]
Counsel
for the appellant argues that a mark can only be distinctive of a single
source. The name Miranda, he asserts, cannot be distinctive of the respondent’s
goods and services because the father’s brother, John, had also used Miranda
from the 1970s to 1995 in the names of corporations through which he conducted
manufacturing and wholesale businesses for the supply of aluminum and vinyl
products. Counsel also alleges that the Judge ignored the evidence that John’s
products were advertised on the respondent’s website as “Genuine Miranda
Products”, and that when the respondent advertises on its website that it is a
“family owned business”, it is referring to John and his companies.
[25]
I do not
agree. The Judge found that John’s use of the name Miranda in his business was
irrelevant because John was in the manufacturing and wholesale business, while
the respondent was in retail sales and installation. The businesses were thus
not competing with each other. Accordingly, she held, John’s use of the name
did not undermine its distinctiveness in connection with the respondent’s
business.
[26]
This is a
finding of fact reasonably open to the Judge on the evidence. That the Judge
did not mention every item of evidence, including the advertising on the
respondent’s website site, is not a legal error. Nor is it clear that the
respondent’s advertisement stating that it is a “family owned business” would
necessarily be understood to be a reference to John and his companies, rather than
to the respondent itself, in which the son, his wife, and sister were engaged.
[27]
Given the
above findings of fact by the Judge, it is unnecessary to determine the legal
effect of the purported 2008 assignment, effective November 21, 1990, whereby
John and his companies assigned to TMR any rights that they had in the use of
the name Miranda as a trade name or trade-mark. However, as counsel for the
respondent points out, this document at least indicates that the respondent and
John’s businesses were not in competition with each other. The purported assignment
thus further supports the Judge’s finding of fact that John and the respondent
were in different kinds of business, and that the name Miranda did not identify
two competing sources of goods and services.
(ii) use of the name Miranda by the
appellant
[28]
The
appellant attacks the findings of fact from which the Judge concluded that the
use of the name Miranda by the father and his companies did not prevent its
association with a single source, the respondent. Having carefully set out (at
para. 31) the evidence on which the appellant had relied to establish the
father’s prior use, the Judge rejected it. For the period of alleged use before
2000, the Judge found that the evidence was not credible, and the father had
twice abandoned the use of the name in connection with a business. She further
held that the appellant could not rely on the father’s use of the name between
2000 and 2004 because his use had been calculated to deceive customers.
[29]
In light of
the evidence indicating the father’s abandonment of the use of the name, the
breaks in the corporate chain, the absence of assignments of rights, the
father’s deceptive later use of the name, and the Judge’s credibility finding,
I am not satisfied that the Judge made a palpable and overriding error when she
concluded that the father’s use of the name Miranda had not destroyed its
distinctiveness by establishing in the minds of consumers that there was a
competing source for the aluminum products and associated services. Again, the
appellant is asking the Court to step into the shoes of the Judge and reweigh
the evidence. This is not the function of an appellate court.
(iii)
Since Mirada is primarily merely a surname, it had not acquired distinctiveness
as connoting the source of tbe products and services supplied by the
respondent.
[30]
While it
may be unusual for a surname to be found to have acquired distinctiveness in
connection with goods or services provided by an individual or a corporation,
the question is ultimately one of fact, to be determined on the basis of the
evidence adduced in a given case. Thus, the Judge found in this case that the
name Miranda had distinctiveness as of July 16, 2007, when the respondent
instituted this expungement proceeding. In the absence of any error of law, her
finding of fact may only be set aside if it was not reasonably open to her on
the whole of the evidence.
[31]
In my view
it was and there is therefore no basis for this Court to intervene.
[32]
Thus, the
Judge stated (at para. 26) that she agreed with the son when he said that
the fact that
customers identify his wares and services with him personally proves the
acquired meaning and distinctiveness of the marks and the fact that they
actually distinguish his company’s wares and services from those of others.
She then set out (at para. 27) the evidence on which she
relied to support her finding. In my opinion, the observations made by counsel
for the appellant about that evidence went essentially to the weight that the
various items should be given. I am not persuaded that either individually or
collectively, they demonstrated palpable and overriding error in the Judge’s
findings of fact.
[33]
Counsel
for the appellant also submitted that the marks are registered without any
geographical restriction, although the only evidence that the name Miranda had
any distinctiveness related to its use in the GTA and, in particular, in the Portuguese
community.
[34]
However,
it is difficult for the appellant to maintain that the Judge should have
imposed a restriction on the registration of the marks when the appellant had
not argued before her that, if she found that the name was perceived as having
distinctiveness, it was limited to the GTA or, possibly, to the Province of
Ontario.
[35]
In fact,
the only argument advanced below was that the name was not distinctive at all,
which the Judge rejected, finding that the appellant had not discharged the
onus of proving that the marks should be expunged from the register. Moreover,
since the father has no interest in using the name Miranda in connection with a
vinyl and aluminum products business anywhere else in Canada, the issue has an
air of unreality.
[36]
In all these
circumstances, I see no basis for interfering with the Judge’s decision that the
appellant had not proved that the marks should be expunged from the register by
virtue of paragraph 12(1)(a).
Issue 3: Did the
Judge err in failing to hold that the name falsely suggested a connection with
a living person, that is, the father?
[37]
The Judge
deals with this issue at paragraph 34 of her reasons, stating that the son
first used the name Miranda in his business in 1990, when his father was
working as a salesman in the son’s business, having been out of his own
business since 1988 following his arrest and conviction for trafficking
cocaine, events which received some publicity in a newspaper in Toronto. In
these circumstances, the Judge found, it was unlikely that, in 1990, the public
would have falsely connected the name Miranda with the father in association
with the supply and installation of aluminum and vinyl products, or that the
son would have attempted to encourage such confusion.
[38]
Further,
it is difficult for individuals to invalidate the registration of a trade-mark
on the basis that the public will falsely associate the mark with them.
Normally, a person challenging the validity of a trade-mark on this ground must
establish the existence of a “significant public reputation” (Bousquet v.
Barmish Inc. (1991), 37 C.P.R. (3d) 516 (F.C.T.D.) at 524), which there is
no evidence that the father had.
[39]
Whether
the public would have associated the son’s use of the name Miranda in his
business with his father is a factual question. On the basis of the
considerations set out above, I am not persuaded that the Judge made a palpable
and overriding error in concluding that such a connection was not likely to be
made.
[40]
For all
these reasons, I would dismiss the appeal with costs.
“John
M. Evans”
“I
agree.
Marc Noël J.A.”
“I agree.
Eleanor R. Dawson J.A.”
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