T-4267-82
Mayborn Products Limited (Appellant)
v.
Registrar of Trade Marks (Respondent)
and
Gowling & Henderson (Requesting Party)
Trial Division, Cattanach J.—Ottawa, January 24
and February 22, 1983.
Trade marks — Appeal from Registrar's decision expunging
trade mark for non-user following s. 44 notice — Use of mark
by subsidiary of registered owner not use by latter
"Requesting party" designation in style of cause not constitut
ing person so described party to appeal — On appeal, proper
designation of "requesting party" "appellant", or joined as
"respondent" — Trade Marks Act, R.S.C. 1970, c. T-10, ss.
37(9) (as added by S.C. 1976-77, c. 28, s. 44), 44(1),(2),(4),(5),
56 — Federal Court Rules, C.R.C., c. 663, R. 1716(2)(b).
Practice — Parties — Trade marks — "Requesting party"
designation in style of cause not constituting person so
described party to appeal — On appeal, proper designation of
"requesting party" having initiated s. 44 inquiry, "appellant",
or joined as "respondent" — Trade Marks Act, R.S.C. 1970,
c. T-10, ss. 37(9) (as added by S.C. 1976-77, c. 28, s. 44),
44(1),(2),(4),(5), 56 — Federal Court Rules, C.R.C., c. 663, R.
1716(2)(6).
The Registrar of Trade Marks, acting under section 44 of the
Act, expunged the appellant's mark "Dylon Paintex" for non
user. The question, on appeal, was whether use of the trade
mark in Canada by a subsidiary is "use" within the meaning of
the Act.
Held, the appeal should be dismissed. Use by a subsidiary, if
it is not carrying on business as agent of the parent company
owner of the trade mark and described as such, is not use by
the latter, especially if, as in the present case, the relevant
inscription is only susceptible of conveying to the consumer that
the subsidiary is the owner of the mark. There is therefore a
complete lack of evidence of use of the mark by its registered
owner in Canada because the direct chain of selling and
delivering the wares in the normal course of trade, which would
constitute "use" in Canada, has been broken by the insertion of
the subsidiary without identifying it as a mere conduit from the
registered owner to the consumer.
The parties to an appeal from a decision under section 44
should be designated as follows: the registered owner, when his
trade mark has been ordered to be expunged, "appellant", the
Registrar, "respondent", and the "requesting party" who ini
tiated the inquiry under subsection 44(1), if the appellant so
desires, may be joined as "respondent". If the decision is
adverse to the interests of the requesting party, the latter may
appeal as "appellant". "Appellants" and "respondents" are the
only categories of parties on such an appeal. The designation of
a person as "requesting party" does not constitute such person
party to this appeal.
CASES JUDICIALLY CONSIDERED
APPLIED:
Ports International Limited v. Registrar of Trade Marks
(order dated July 22, 1982, Federal Court—Trial Divi
sion, T-59-82, not yet reported); Lindy v. Registrar of
Trade Marks, [1982] 1 F.C. 241; 57 C.P.R. (2d) 127
(T.D.); Manhattan Industries Inc. v. Princeton Manufac
turing Ltd. (1972), 4 C.P.R. (2d) 6 (F.C.T.D.); Uarco
Incorporated v. Phil Borden Limited, [1973] F.C. 650;
10 C.P.R. (2d) 97 (T.D.).
NOT FOLLOWED:
Parker-Knoll Ltd. v. Registrar of Trade Marks (1977),
32 C.P.R. (2d) 148 (F.C.T.D.).
DISTINGUISHED:
Marchands Ro -Na Inc. v. Tefal S.A. (1981), 55 C.P.R.
(2d) 27 (F.C.T.D.).
CONSIDERED:
Galuga v. Registrar of Trade Marks et al. (order dated
March 30, 1983, Federal Court—Trial Division,
T-6647-82, not yet reported).
REFERRED TO:
Good Humor Corporation of America v. Good Humor
Food Products Limited et al., [1937] Ex.C.R. 61.
COUNSEL:
Robert Gould for appellant.
Michael Ciavaglia for respondent.
No one appearing on behalf of requesting
party.
SOLICITORS:
Smart & Biggar, Ottawa, for appellant.
Deputy Attorney General of Canada for
respondent.
Gowling & Henderson, Ottawa, for request
ing party.
The following are the reasons for judgment
rendered in English by
CATTANACH J.: As is indicated in the style of
cause this is an appeal pursuant to section 56 of
the Trade Marks Act [R.S.C. 1970, c. T-10] from
a decision of the Registrar of Trade Marks under
section 44 of that Act, exercised by the Registrar
through delegation to an Opposition Board under
the authority of subsection 37(9) [as added by
S.C. 1976-77, c. 28, s. 44], whereby the Registrar
concluded that the appellant, as the registered
owner of the trade mark here in question, had
failed to establish that the trade mark had been
used by it in Canada as it is required to do in
response to a notice served upon it pursuant to
subsection 44(1) of the Act and accordingly the
Registrar held that the trade mark shall be
expunged.
The appellant, Mayborn Products Limited,
whose address is Worsley Bridge Road, Lower
Sydenham, London, SE 26 5HD, England, is the
registered owner of the trade mark "Dylon Pain -
tex" for use in association with "paints, dyes,
colouring materials, ingredients thereof and addi
tives therefore". I have taken the liberty of insert
ing a comma after the word "dyes" and the words
"colouring materials" because the context so dic
tates even though in the trade mark as registered
these commas are omitted (which corresponds with
the statement of wares in the application for regis
tration in Canada) but they are not omitted from
the certified copy dated December 4, 1973 of the
pending application before the Trade Mark Regis
try in Great Britain which application matured
into registration on June 16, 1972 and which is the
priority filing date claimed in the application for
registration in Canada. Likewise the concluding
word in the statement of wares should read "there-
for" rather than "therefore".
The trade mark registration, which was applied
for in Canada on August 21, 1972, was registered
on August 2, 1974.
By notice dated March 24, 1981 pursuant to
section 44 of the Act addressed to the registered
owner and its agent for service the Registrar
required the registered owner to establish by
affidavit or statutory declaration whether the trade
mark is in use in Canada and, if not, the date when
it was last so used and the reason for the absence
of such use since that date.
This request was made by Gowling and Hender-
son, Barristers and Solicitors, as well as Patent and
Trade Mark Agents, Toronto, Ontario on Febru-
ary 24, 1981, most likely on behalf of a client.
In the style of cause Gowling and Henderson are
named as a party identified as "Requesting
Party". I am not aware of any such category of
party to a statement of claim, a declaration, notice
of appeal or in the style of cause in any like
originating document.
In statements of claim and counterclaims there
are plaintiffs and defendants. In some instances
where a defendant alleges a claim over against
another person in the event of the defendant being
found liable to the plaintiff there may be a claim
over by the defendant against a third party. Spe
cific rules govern third party proceedings.
Deceased persons and persons under a disability
may sue as plaintiffs or be sued as defendants
through a representative who discloses that repre
sentative capacity.
Generally in common law and chancery matters
a plaintiff who conceives that he has a cause of
action against a defendant is entitled to pursue his
remedy against that party alone. He cannot be
compelled to proceed against other persons whom
he has no desire to sue except in the circumstances
contemplated in Rule 1716(2)(b) [of the Federal
Court Rules, C.R.C., c. 663] and then only as a
defendant but there can be no joinder as a plaintiff
without that party's consent.
There are certain statutes which require that
specified persons shall be plaintiffs and if they
declined to do so they may be added as a defend
ant, not as a plaintiff, and in other instances
provision is made that specified persons shall be
named as defendants. I have in mind the Patent
Act [R.S.C. 1970, c. P-4] and the Canada Ship
ping Act [R.S.C. 1970, c. S-9] respectively.
In notices of appeal the parties are appellants
and respondents. These are the only categories of
parties.
Thus it is the plaintiff or appellant who names
the parties whom he desires as defendants or
respondents.
If others wish to be joined as defendants they
must initiate the application to be so joined and
the same applies to respondents to a notice of
appeal or for intervenants.
While intervenants may participate they are, by
practice, precluded from receiving an award of
costs.
The categories mentioned, in the absence of
special provisions in Rules or statutes, are the only
categories of parties and, in my view, it is improp
er to name a person in the style to a statement of
claim or notice of appeal without designating the
capacity in which that party is so named.
In appeals from decisions from the Registrar of
Trade Marks under section 44 of the Trade Marks
Act counsel in the present matter indicated that
uncertainty and divergent views existed in the
profession and requested clarification.
The registered owner of the trade mark which
the Registrar has found not to be in use or that
there has been no satisfactory explanation for an
absence of use pursuant to a request under subsec
tion 44(1) and the trade mark has been ordered to
be expunged may appeal that decision in the
capacity of an "appellant" naming the Registrar
as a "respondent" in the notice of appeal.
In my view naming the Registrar in the capacity
of a "respondent" should not be disturbed, that
practice having prevailed for decades both in the
United Kingdom and Canada.
The difficulty arises as to whether the "request-
ing party" who initiated an inquiry under subsec
tion 44(1) should be added as a party and if so in
what capacity.
In numerous instances, where the decision by
the Registrar has been adverse to the interests of
the requesting party, the requesting party has filed
a notice of appeal from that decision in the capaci
ty of an "appellant". In my opinion it is quite
proper for the requesting party to do so and to do
so in that capacity.
That being so it is, in my opinion, equally proper
that the requesting party should be joined with the
Registrar as a "respondent" (and that is the only
category in which the requesting party can be
joined) by the registered owner who appeals a
decision by the Registrar as an "appellant" if the
appellant so desires.
The view to the contrary is predicated upon the
remarks made by my brother Walsh in Parker-
Knoll Ltd. v. Registrar of Trade Marks ((1977),
32 C.P.R. (2d) 148 [F.C.T.D.]).
Parker-Knoll Ltd. was the registered owner of a
trade mark ordered to be expunged for failure to
establish use of the trade mark in response to a
notice sent to the registered owner at the written
request of Knoll International Inc. by its trade
marks agent.
Parker-Knoll Ltd. was the appellant and the
Registrar was named as the respondent. These
were the only two parties named in the notice of
appeal.
At pages 155-156 Walsh J. said:
At the hearing the respondent, the Registrar of Trade
Marks, was not represented but Knoll International Inc. who
had requested the Registrar to issue the s. 44 notice December
9, 1975, were represented by counsel and opposed the appeal.
While they are quite properly not parties to the proceedings, s.
44(2) while limiting the evidence which the Registrar can
consider to the affidavit or statutory declaration of the owner
nevertheless permits representations to be made not only on
behalf of the registered owner but also on behalf of the person
at whose request the notice was given. I believe, therefore, that
it is proper that the said Knoll International Inc. should be
represented by counsel and permitted to make representations
at the hearing of the appeal. In the absence of representations
on behalf of the Registrar I believe that it is a necessary
consequence of the adversary system, as well as a logical
extension of the provisions of s. 44(2) to permit Knoll Interna
tional Inc. to make such representations, defending the Regis
trar's decision to expunge the trade mark in question, and
appellant did not object to this.
With respect and deference to my brother
Walsh I do not agree with his statement that:
While they (Knoll International Inc. parenthetically inserted by
myself) are quite properly not parties to the proceedings ...
as inconsistent with the course he adopted and the
statutory provisions upon which he relied to sup
port that statement.
If Knoll International Inc. was not a party to the
appeal I fail to follow by what authority it could
be represented by counsel and make representa
tions at the hearing.
Subsection 44(2) to which Walsh J. referred
provides that the registered owner only shall file
an affidavit or statutory declaration. That is a
strict limitation on the evidence to be placed
before the Registrar. But the subsection permits
the hearing of representations by or on behalf of
the registered owner and by or on behalf of the
person at whose request the notice was granted.
By reason of that provision Walsh J. permitted
Knoll International Inc. to exercise the rights of a
party. In my view if it is proper for the requesting
party to exercise those rights it is equally proper
and more consistent and logical that Knoll Inter
national Inc. be named as a respondent before
exercising those same rights on appeal either on its
own motion or on motion by the judge himself.
The fact that the appellant did not object to the
requesting party participating and being represent
ed by counsel on appeal does not make that pro
ceeding proper.
Subsection 44(2) contemplates a lis, or at the
very least a quasi -lis, before the Registrar, the
divergent interests having been those of the regis
tered owner and the person at whose request the
notice was given to the registered owner by the
Registrar.
Subsection 44(4) requires that the Registrar
shall give notice of his decision to the registered
owner and to the person at whose request the
notice was given to the registered owner by the
Registrar. Normally notice is not given in a lis or
quasi -lis to a person who does not have the attri
butes of a party thereto and no logical exception
appears to prevail here.
Subsection 44(5) dictates the action by the Reg
istrar if no appeal is taken from his decision. That
appeal is not limited to one party to the lis. Either
the registered owner or the party at whose request
the notice was given may be the appellant and
since that be so either may be named as a respond
ent along with the Registrar.
No other case was cited to me nor am I aware of
any in which that statement by Mr. Justice Walsh
was followed or approved.
On the other hand in Ports International Lim
ited v. Registrar of Trade Marks [order dated
July 22, 1982, Federal Court—Trial Division,
T-59-82, not yet reported] Ports International was
named as the appellant and the Registrar was
named as the respondent. There were no other
parties named. It was therein stated [at page 4]:
I know of no manner in which a person who is not a party to
the action can participate therein.
That being so I fail to follow how the "Requesting Party"
may make a reply to a notice of appeal in which it is not named
as a respondent and should be granted an extension of time to
do so as the notice of motion seeks.
In Galuga v. Registrar of Trade Marks et al.
[order dated March 30, 1983, Federal Court—
Trial Division, T-6647-82, not yet reported] the
registered owner of a trade mark appealed from a
decision of the Registrar expunging the trade mark
naming only the Registrar as respondent.
Counsel for John S. Lockhart, on whose behalf
counsel had requested the Registrar to serve the
owner with a notice under subsection 44(1), by
notice of motion applied for leave to participate in
the appeal and to be added to the style of cause as
a respondent. An order to that effect with conse
quential rights following thereupon was granted.
The practice has developed that patent agents
who practice before the Registrar make written
requests on behalf of undisclosed clients to the
Registrar under subsection 44(1) that notice be
given to the registered owner of a trade mark
requiring the owner to establish use of the trade
marks or justification for failing to do so.
In such circumstances the patent agent, being
the agent of an undisclosed principal, it may well
follow that the patent agent can be named as a
respondent in the capacity of principal under the
ordinary principles of agency with the consequence
which may flow therefrom.
In the present instance Gowling and Henderson
are named in the style of cause as "Requesting
Party". I do not recognize that designation as
constituting the person so described as a party to
the appeal. For that to be the case the designation
should have been as a "respondent". That party,
however designated, did not appear or participate
in the proceedings.
The appellant responded to the notice from the
Registrar pursuant to section 44 by affidavit sworn
by William Thomas Stone based upon his personal
knowledge as a director of the appellant corpora
tion.
The affiant establishes that:
1) the appellant is the registered owner of Canadian trade mark
registration of the mark DYLON PAINTER;
2) the appellant manufactures and packages the wares in
association with which the trade mark is used;
3) these packages "are transferred in the normal course of
business" to the appellant's "distributor" of these wares,
DYLON INTERNATIONAL LTD., a subsidiary of the appellant;
4) the packages are then transferred to a Canadian distributor,
Farquhar International, which in turn transfers "the property
in and possession of the said wares .... to purchasers in
Canada in the normal course of trade through the sale in
Canada by Farquhar International Limited".
There are exhibited to the affidavit copies of
invoices establishing the sale in Canada by Far-
quhar International Limited to the ultimate con
sumer of the wares.
In his decision dated April 27, 1982 the Regis
trar, in my opinion, correctly concluded that the
appellant by the process described introduced its
wares bearing the trade mark "Dylon Paintex" on
the packages printed by the appellant in which
packages the appellant enclosed its wares, into the
channels of trade resulting in a use of the trade
mark in Canada.
Parenthetically speaking when I mention the
Registrar I mean to include in that word where the
context requires the member of the Opposition
Board who actually made the decision and signed
it "David J. Martin for Registrar of Trade
Marks".
What the Registrar did not accept was that the
use so described was use in Canada by the
appellant.
He predicated his conclusion to that effect upon
the language printed upon the package containing
the wares.
As previously indicated a specimen of the pack
age printed by the appellant or on its instructions
in which the appellants inserted its wares before
the package and contents were "transferred" to
Dylon International Ltd., its distributor and sub
sidiary, was annexed to the affidavit sworn by Mr.
Stone as Exhibit A.
That package is printed in colours, the back
ground being purple. It is rectangular in shape,
five inches in length, about two and three-quarters
inches in width and one-half inch in depth.
On the front the words "Dylon Paintex" printed
in the largest type, encircled by an oblong, are
predominant. The word "Paintex" is printed on
each end and the words "Dylon Paintex" are
printed on each side.
On the reverse side or back of the package
instructions are printed in English and French for
the use of "Dylon Paintex". The contents are there
described as one sachet "Dylon Paintex" and one
sachet "Dylon-Cold Dye-Fix".
Beneath the instructions for use and the con
tents in type very slightly smaller than that of the
words "Dylon Paintex" and "Dylon-Cold Dye-
Fix" are printed the words and figures:
"DYLON INTERNATIONAL LTD.,
LONDON,
SE 26 5HD, ENGLAND"
in a single line in high case letters throughout.
Immédiately below that line, in smaller type are
printed the legends on the same single line:
"Made in England Trade Marks Registered"
in lower case but with capitals as indicated above.
Where the word "Dylon" appears on the front
of the package above the word "Paintex" (the
words appearing in different styled type) there is
the device of the letter R within a circle. In United
States legislation there is the requirement that a
registered trade mark shall be so identified. There
is no such requirement in the Trade Marks Act in
force in Canada but because of the volume of
United States products and advertising thereof in
publications which flow into Canada the Canadian
purchasing public had become aware of that
device signifying a registered trade mark but not
necessarily where registered.
In the printed legend on the reverse side of the
package the use of the words "Trade Marks Regis
tered" in the plural might refer to "Dylon" alone,
"Paintex" alone (although "Paintex" is disclaimed
in the registration of "Dylon Paintex" in Great
Britain) or to "Dylon Paintex". It is remotely
possible that the subsidiary, Dylon International
Ltd., was intended to be described as the agent to
its parent, the appellant, but it was not.
In my view the mere fact that one incorporated
company controls another is not sufficient by itself
and in the absence of convincing evidence to the
contrary to establish that the controlled company
carries on business as agent of the controlling
company.
A trade mark must be used only to distinguish
the wares of the owner of the trade mark and it is
an infringement to use it on the wares of a related
company, even the subsidiary of the owner of the
trade mark.
I do not think that a trade mark as defined in
the Trade Marks Act, enacted in 1953, can be
adapted to the concept of a "single organization"
such as conceived by Angers J. in Good Humor
Corporation of America v. Good Humor Food
Products Limited et al. ([1937] Ex.C.R. 61, at
page 74). There is the possibility that there may be
joint owners of a trade mark but they would be
acting in concert and in doing so might well consti
tute a partnership and the partnership members
would be the corporations.
Like the Registrar I am satisfied that there is no
question whatsoever that the trade mark "Dylon
Paintex" was used in Canada but to me the crucial
question remaining to be answered is "By whom
was the trade mark used?"
I do not think that the editorial note to Manhat-
tan Industries Inc. v. Princeton Manufacturing
Ltd. ((1972), 4 C.P.R. (2d) 6 [F.C.T.D.]) in the
context in which it was quoted by my brother
Addy in Marchands Ro -Na Inc. v. Tefal S.A.
((1981), 55 C.P.R. (2d) 27 [F.C.T.D.] at page 33)
is authority to contrary.
The portion quoted by Mr. Justice Addy reads:
... see also editor's note to the effect that the important
question is not who is using the mark but whose mark is being
used in Canada.
The pertinent paragraph of the editorial note in
its entirety reads [at page 7, 4 C.P.R. (2d)]:
The question is not who iF using the mark but whose mark is
being used. As long as the wares originate from the owner it is
suggested that his mark is being used even if no sales in Canada
are directly made by that owner. In the normal course of trade
the wares were placed on the market by the trade mark owner.
I am in agreement with the conclusion reached
by my brother Dubé in Lindy v. Registrar of
Trade Marks ([[1982] 1 F.C. 241]; 57 C.P.R.
(2d) 127 [T.D.]) when he said at page [246 F.C.]:
Reading the Act as a whole, the conclusion is inescapable, in
my view, that "use in Canada" means use by the registered
owner or a registered user.
That is basic to the concept of a trade mark. It
is a mark that is used by a trader to identify as his
the wares made by him. (In certain circumstances
it may be used by certain persons to identify wares
selected by that person for sale by him.) The trade
mark confers on the registered owner the exclusive
use of the trade mark in Canada.
Likewise I am in agreement with the decisions
in the Manhattan Industries case and in Uarco
Incorporated v. Phil Borden Limited ([[1973]
F.C. 650]; 10 C.P.R. (2d) 97 [T.D.]) that there
was a direct chain of selling and delivering the
wares, in the normal course of trade.
In this instance that direct chain in the normal
course of trade would be the sale by the appellant
to its distributor in England, the sale by that
distributor to a distributor in Canada (or directly
by the English distributor to a wholesaler or retail
er in Canada) and ultimately by the Canadian
distributor to a retailer or the consumer.
But that direct chain has been broken by the
insertion of Dylon International Ltd., without
identifying that corporate entity as being merely a
conduit from the registered owner of the trade
mark to the consumer.
On the contrary the legend is only susceptible of
conveying to the consumer that Dylon Internation
al Ltd., was the owner of the trade mark and that
follows from a complete absence of a reference to
the name of the registered owner from the package
nor any indication that Dylon International Ltd.
was but the distributor for the registered owner.
That being so there was a complete lack of
evidence of the use of the trade mark by its
registered owner in Canada. The evidence of use
was by its subsidiary, Dylon International Ltd.
which is not the registered owner.
For the foregoing reasons I am in agreement
with the decision of the Registrar and the appeal is
dismissed.
There will be no award of costs for or against
any party to the appeal.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.