The Quebec Court of Appeal Rules on the Necessity for a Foreign Entity to Register With the Provincial Authorities in Order to Pursue Trade-Mark Litigation In Quebec



THEQUEBECCOURTOFAPPEALRULESONTHENECESSITYFORAFOREIGN
ENTITYTOREGISTERWITHTHEPROVINCIALAUTHORITIESINORDERTOPURSUE
TRADE-MARKLITIGATIONINQUEBEC

By
AlexandraSteele*
LEGERROBICRICHARD,Lawyers
ROBIC,Patent&TrademarkAgents
CentreCDPCapital
1001Square-Victoria-BlocE–8
thFloor
Montreal,Quebec,CanadaH2Z2B7
Tel.:(514)9876242-Fax:(514)8457874
www.robic.ca-info@robic.com
TheQuebecCourtofAppealrecentlyruledthataforeigncorporation,owner
ofaCanadiantrade-mark,didnothavetoregisterwithQuebec’sInspector
GeneralofFinancialInstitutions(“IGFI”)inordertopursuelegalproceedings
fortrade-markinfringementsinceitdidnotcarryonanycommercialactivities
intheProvinceofQuebec(WhiteInternationalManagementInc.v.9041-
8351QuebecInc.,C.A.M.500-09-011278-017,January11,2002,Mailhot,
DussaultandThibaultJJ.A.).
MandatoryRegistrationintheProvinceofQuebec
AnActRespectingtheLegalPublicityofSoleProprietorships,Partnershipsand
LegalPersons,R.S.Q.c.P-45(“LegalPublicityAct”)cameintoforceon
January1,1994.TheLegalPublicityActprovidesthatanypersonor
partnershipcarryingonanactivityinQuebecisrequiredtoregisterwiththe
IGFI,whetherornotthispersonorpartnershipisformedinQuebec.The
purposeofregistrationistoenablethepublictoobtainreliableinformation
concerningtheidentityofCanadianandforeignentitieswhichcarryon
commercialactivitiesinQuebec.TheIGFIisresponsibleformaintaininga
publicregisterofallsuchregisteredpersonsorpartnerships
1.



















































©LEGERROBICRICHARD,2002.*OftheLawfirmLEGERROBICRICHARD,g.p.andthePatentandTrademarkAgencyFirm
ROBIC,g.p.Publication142.137.

1Theregisterisaccessiblefreeofchargeat:
https://ssl1.igif.gouv.qc.ca/index_recherche_consultation.htm



Thefacts
WhiteInternationalManagementInc.(“White”)isacompanyincorporatedin
theBahamasandistheregisteredowner,inCanada,ofthetrade-mark
CENTREDESANTÉMINCEUR(TMA489,713)inassociationwithwaresand
servicesrelatingtoweightcontrol.
GestionFinanceTamalia(“Tamalia”)isacompanyincorporatedinQuebec
anddulyregisteredwiththeIGFI.Furthertoanexclusiveverballicense
agreement,TamaliawasauthorizedbyWhitetocommercialisethewares
andservicesundertheCENTREDESANTÉMINCEURtrade-mark.Tamalia
operatedafranchisebusinesswherebythefranchiseesusedtheCENTREDE
SANTÉMINCEURasatrade-markandalsoasabusinessname.
9041-8351QuebecInc.(“QuebecInc.”)wasafranchisee,andupon
terminationofitsfranchiseagreementwithTamalia,QuebecInc.continued
tousetheCENTREDESANTÉMINCEURtrade-markandbusinessname.
WhiteandTamaliainstitutedproceedingsforinterlocutoryandpermanent
injunctivereliefagainstQuebecInc.whoimmediatelyrequestedthatWhite
postasecurityforcosts,sinceitwasaforeignplaintiff,andthatWhiteregister
itsbusinesswiththeIGFI.QuebecInc.furtheraskedthattheCourtsuspendall
legalproceedingsagainstitpendingWhiteobtainingregistrationwiththe
IGFI.
TheQuebecSuperiorCourtjudgement
Inrenderinghisjudgement,theSuperiorCourtJudgereliedonQuebecInc.’s
allegationsthatWhitenotonlycontrolledthequalityofthewaresand
servicesunderlicense,butalsoprofitedfinanciallyfromTamalia’slicenseduse
oftheCENTREDESANTÉMINCEURtrade-mark.TheJudgeappliedthe
presumptionunderSection6oftheLegalPublicityActthatanypersonor
partnershipwhichcarriesoutanactforthepurposeofprofitispresumedto
becarryingonanactivityoroperatinganenterpriseinQuebec.TheTrial
JudgethereforegrantedQuebecInc.’smotionforasecurityforcosts,and
orderedWhitetoobtainregistrationinaccordancewiththeLegalPublicity
Act.TheJudgefurtherorderedthatthatallproceedingsbestayedpending
registration.
WhitedisagreedwiththeSuperiorCourtjudgementandappealedthe
decisiontotheQuebecCourtofAppeal.



TheQuebecCourtofAppealjudgement
Onappeal,WhitepleadedthatitwasnotobligatedtoregisterwiththeIGFI
sinceitdidnotcarryanycommercialactivitiesinQuebec.QuebecInc.
pleadedthatWhitewaspresumedtocarryonactivitiesinQuebecsinceit
hadanaddress,thatofitsrepresentativesforservice,asappearedfromthe
trade-markregister.Inaddition,QuebecInc.reliedonSection50ofthe
Trade-MarksAct,R.S.C.ch.T-13(“Trade-MarksAct”)arguingthatby
exercisingcontroloverthequalityofthewaresandservicescommercialised
byTamalia,Whitealsocommercialisedthesaidwaresandservices,thus
carryingoncommercialactivitiesintheProvinceofQuebec.

Firstly,theCourtconsideredonlythefactscontainedintheproceedings
formingpartofthecourtrecord,namelytheinterlocutoryandpermanent
injunctionproceedings.IntheCourt’sopinion,theproceedingsweresilentas
tothefinancialaspectsofthelicenseagreementbetweenWhiteand
Tamalia.NothingintherecorddemonstratedthatprofitinuredtoWhite
furthertotheverballicenseagreement.IntheCourt’sview,QuebecInc.
confusedthenotionofcarryingonacommercialactivityundertheLegal
PublicityActwiththenotionofexercisingtherightsconferreduponatrade-
markownerbyvirtueofitstrade-markregistration.ThefactthatWhite
exercisedsomeformofqualitycontroloverTamalia’suseoftheCENTREDE
SANTÉMINCEURtrade-markdidnotconstituteproofthatWhitecarriedon
commercialactivitiesinQuebec.
Secondly,theCourtruledthatQuebecInc.incorrectlyreliedonSection50of
theTrade-MarksActtoassertthatatrade-markregistrationwassufficientin
itselftoshowusebyitsowner.Section50oftheTrade-MarksActsetsoutthe
conditionsforlicensingtrade-markrightstoathirdparty.Thissectionfurther
providesthatthetrade-markownermustbeapartytoanyactionfor
infringementofitstrade-mark.TheCourtruledthatWhitewaslegallyentitled,
andobligated,toinstitutelegalproceedingsagainstQuebecInc.inorderto
protectanddefenditstrade-markrights.
Thirdly,thefactthatWhitehaddesignatedarepresentativeforserviceforthe
purposeofitstrade-markregistrationcouldnotbeconstruedasWhitehaving
anaddressorplaceofbusinessinQuebecforthepurposeoftheLegal
PublicityAct.Section30oftheTrade-MarksActspecificallyrequiresforeign
entitieswhodonothaveaplaceofbusinessorofficeinCanadatodesignate
arepresentativeforservice.Onceagain,theCourtdeemedthatQuebec
Inc.’sargumentwasmoot.
TheCourtofAppealconcludedthattheLegalPublicityActmustnotbe
interpretedasrequiringallforeignentitieswishingtoexercisetheirrightsand



recoursesintheProvinceofQuebectoregisterwiththeIGFI.Consequently,
QuebecInc.’sappealwasdismissedwithcosts.
Thiscaseconstitutesareminderforalltrade-markowners,whethernationalor
foreign,toexercisecareinensuringthattheyhavecompliedwiththetrade-
markandcommerciallawsinforceinthevariousterritorieswheretheycarry
on,orintendtocarryon,theiractivities,astheymayeventuallyencounter
problemsenforcingtheirrightsduetononcompliancewiththelaw.
Publishedat(2002),16-4WIPR4-5underthetitleQuebecCourtRuleson
Foreigners’NeedToRegisterWithProvincialAuthorities
©LEGERROBICRICHARD,2002.



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