Date: 20040219
Docket: T-643-03
Citation: 2004 FC 250
Ottawa, Ontario, this 19th day of February, 2004
Present: The Honourable Mr. Justice Mosley
BETWEEN:
PETER EIBA
Applicant
and
THE ATTORNEY GENERAL OF CANADA
Respondent
REASONS FOR ORDER AND ORDER
[1] This is an application for judicial review in relation to a purported decision of the Commissioner of Patents (the "Commissioner"), dated March 24, 2003. The Commissioner took the position that Canadian patent application No. 2, 182, 092 (the "application") was abandoned and beyond the period for reinstatement due to the applicant's failure to pay the required maintenance and reinstatement fees. The applicant, Mr. Peter Eiba, seeks an order setting aside the abandonment of his application and an order that the Commissioner reinstate his application and accept the maintenance fees that are due in respect thereto. The applicant also seeks costs in this application.
BACKGROUND
[2] Mr. Eiba is a resident of Germany and had originally claimed protection in that country for an invention entitled "Method and System for the Automatic Control of a Tournament" in 1995. He brought an application in Canada for similar protection on July 25, 1996. Pursuant to the Patent Rules, SOR/96-243 (the "Rules") and article 11 of the Patent Cooperation Treaty, the application bears the filing date of the international application, that is January 27, 1995.
[3] Annual maintenance fees pursuant to section 27.1 of the Patent Act, R.S.C.1985, c. P-4 (the "Act") were payable to the Canadian Intellectual Property Office (the "Office") on or before January 27 of each year after 1997. Pursuant to Rule 64(2) of the Rules, a request for examination of the application had to be filed at the Office within seven years of the international filing date. Since January 27, 2002, was a Sunday, the due date for requesting an examination was January 28, 2002.
[4] For each of the years between 1997 and 2001, the required maintenance fees were paid to the Office, on instruction by the applicant to his Canadian agents. This was not done for the year ending on January 27, 2002, nor was the request for examination filed within time along with the appropriate fee.
[5] By letters dated February 23, 2002, and March 11, 2002, the Office notified the applicant's agents that the application was deemed abandoned on two grounds. First, for failure to pay the yearly maintenance fee, pursuant to paragraph 73(1)(c) of the Act and secondly, for failure to request examination and pay the prescribed fee, pursuant to paragraph 73(1)(d). For each ground, a twelve-month reinstatement period in which the applicant could request reinstatement and pay the prescribed fees was available pursuant to subsection 73(3).
[6] The applicant has filed affidavits from a lawyer and three patent agents familiar with the process of patent applications filed with the Office. The evidence of Mr. Robert Wilkes, patent agent, is that his firm prepared two sets of submissions, both dated June 20, 2002, each addressing a different ground of the deemed abandonment and instructing the Office to debit their Visa account with the applicable fees. Both submissions requested reinstatement of the patent application. These submissions, Mr. Wilkes attests, were handed over to the firm's file room personnel for transmission to the Office. There is no evidence that they were thereafter entrusted to Canada Post or other means of delivery, nor is there any evidence that the firm took any active steps to ascertain whether the submissions were in fact delivered or that the related fees were paid through their Visa account.
[7] There is no question that the Office received the submission pertaining to paragraph 73(1)(d), requesting an examination and providing payment of the examination fee and late fee. However, there is no record of receipt of the second submission by the Office including no entry on the certified patent file, particularly the "Case History for Application/Patent" print-out. It evidently went astray somewhere in transit.
[8] By notice dated August 6, 2002, the Commissioner sent the applicant an "Acknowledgement of Request for Examination", stating that the request for examination and prescribed fee had been received in relation to the application, and that examination of the application "will take place in due course". There was nothing in this acknowledgement to indicate the status of the application with respect to the deemed abandonment due to the failure to pay the annual maintenance fees. However, from the evidence of Mr. Robert Hendry, the responsible patent agent for the application, it appears that the applicant's agents assumed from the issuance of the acknowledgement that the application was in good standing. He attests that it was the invariable practice of the Office to contact the responsible agent where there remained an outstanding ground of abandonment. Similar evidence was offered by the principal of another patent agency firm.
[9] Ms. Heather Probert is a lawyer and registered patent agent at the applicant's counsel's law firm, who, since November 2002, has had primary responsibility at the firm for all matters relating to maintenance fees. Ms. Probert attests that the Office does not issue receipts for maintenance fee payments or reinstatement fee payments. She attests that applicant's agents had no reason to believe after June 20, 2002, that the application had not been reinstated on both grounds, that is pursuant to both subsections 73(1)(c) and (d) of the Act. Applicant's counsel received no communication from the Office in relation to the application, other than the "Acknowledgement of Request for Examination" notice described above.
[10] On January 22, 2003, applicant's counsel submitted payment of the maintenance fee for the next year that was due by January 27, 2003. Ms. Probert attests that this indicates that the applicant believed that his application was already reinstated on both grounds and also demonstrates the applicant's intention to continuously maintain the application in good standing for subsequent years.
[11] Ms. Probert deposes that her firm was informed by the Office, by telephone in mid-March, 2003, that the application was abandoned and incapable of being reinstated because the maintenance fee due on January 27, 2002, had never been paid, nor the reinstatement fee received.
[12] By letter dated March 24, 2003, the Office set out in writing its refusal of the maintenance fee payments for 2003 on the grounds that the payments for reinstatement and maintenance for 2002 had not been received prior to January, 28, 2003 .
[13] By submissions dated March 27, 2003, Mr. Robert Hendry, a patent agent at the firm of applicant's counsel, wrote to the Office, attaching a previous "direction" from the firm to the Office, dated January 8, 2001, stating that any fee deficiency in relation to the application was to be charged to the firm's deposit account.
[14] Again, by letter dated April 7, 2003, the Office confirmed its refusal to accept maintenance or reinstatement fees for the application. That letter stated, in part, as follows:
However, the Office has never received your letter dated June 20, 2002 to pay the maintenance fee which was due January 27, 2002 and the reinstatement fee (requested after January 27, 2002). Therefore, no acknowledgement of reinstatement was issued and the application is now beyond period of reinstatement.
Please note that, the Patent Office does not accept any corrective payments which are submitted after the prescribed time, to compensate for having incorrectly paid the prescribed fees....
[15] The respondent filed no evidence in this proceeding and did not cross-examine the affiants who provided affidavits on behalf of the applicant.
APPLICANT'S SUBMISSIONS
[16] The applicant submits that the Commissioner's decision is properly the subject of judicial review, pursuant to section 18.1 of the Federal Courts Act, R.S.C. 1985, c. F-7, as amended. The applicant argues that the standard of review warranted in this case is correctness. Applying the pragmatic and functional approach, and considering particularly that the decision of the Commissioner as to the payment of maintenance fees does not engage any specialized expertise, and is far removed from the core area of the Commissioner's expertise, the applicant argues that minimal deference is warranted to the Commissioner's decision in this case.
[17] The applicant submits that he was entitled to procedural fairness at each stage of the reinstatement process, and that judicial review would lie of each decision of the Commissioner within the maintenance fee process.
[18] Next, the applicant's main submission focuses on the legal doctrine of legitimate expectations, and that the applicant had an expectation that certain procedures would be followed. The applicant says he relied on such expectation to his detriment, and that while the principle of legitimate expectation cannot be used to create substantive rights, it can be seen as one element of the duty of fairness owed to an applicant by an administrative body.
[19] The applicant submits that he had a reasonable expectation that his application had been brought into good standing after June 20, 2002. The applicant refers to the affidavit evidence filed on his behalf that details the "usual practice" of the Office, and the manner in which he was led to believe that both his submissions of June 20, 2002, reinstating his application pursuant to subsections 73(1)(c) and (d), had been received and processed in the regular course.
[20] The applicant refers specifically to the following "usual practices" of the Office, as attested to by the lawyer and agents of his counsel's law firm:
- the Office would not process a request for examination and send out the notice, "Acknowledgment of Request for Examination" to the applicant if an application had not been fully reinstated on all grounds of deemed abandonment;
- the Office would contact the applicant's representative agent if there was an irregularity or query concerning a request for reinstatement, particularly if there were multiple grounds required for reinstatement and it appeared that only one ground of reinstatement had been sought, prior to the last possible date for reinstatement;
- the Office "consistently" contacts representative agents in situations where the documents received by the Office are not consistent with the apparent intention of an applicant who has filed other documents requesting reinstatement;
- the Office would not accept the fee for requesting an examination unless an application was in good standing, that is, unless all maintenance fees had been fully paid, as the fee for requesting an examination is non-refundable;
- the Office does not provide receipts or acknowledgment for payment of maintenance fees, including payment of reinstatement fees.
[21] The applicant argues that the Office's failure to follow its usual practices led him to reasonably believe, to his detriment, that his application was in good standing. The applicant submits that the Office was in the "exclusive position" of knowing that receipt of the applicant's submissions had inadvertently not occurred. According to the applicant, the Office's practices led him to rely on a legitimate expectation that his application had been fully and properly reinstated.
[22] The applicant submits that the Commissioner had the discretion to investigate whether or not the loss of the applicant's June 2002 submission was wholly or to any extent attributable to an act or omission of the Office. The applicant argues that by declining any review of that possibility, the Commissioner declined to exercise his discretionary jurisdiction, contrary to the principles of natural justice. Here, the applicant relies on University of Saskatchewan v. Canada (Commissioner of the Plant Breeders' Rights Office) (2001), 11 C.P.R. (4th) 348 (F.C.T.D.) and refers to subsection 4(2) of the Act. The applicant argues that the Commissioner had the jurisdiction to find that a request for reinstatement and payment had gone astray in the administrative process and could be "deemed" to have been received by the appropriate deadline.
[23] The applicant submits that the Commissioner's refusal to exercise his jurisdiction has resulted in a complete loss of his substantive rights under the Act. Referring to Barton No-till Disk Inc. et al. v. Dutch Industries Ltd. et al. (2003), 24 C.P.R. (4th) 157 (F.C.A.), leave to appeal to the S.C.C. dismissed December 11, 2003, [2003] S.C.C.A. No. 204 (QL), the applicant argues that this refusal of the Commissioner does not advance any object of the Act. The purpose of the provision providing for the abandonment of an application for non-payment of maintenance fees is to allow for the lapse of "deadwood" applications where an applicant has lost interest in pursuing the application. The applicant submits that it is contrary to the intention of the Act to allow his application to lapse where his actions have demonstrated that he is interested in maintaining the application and no prejudice would result to any other person if his application is reinstated.
RESPONDENT'S SUBMISSIONS
[24] The respondent submits that the non-reinstatement of the applicant's abandoned application occurred independently of any decision or action of the Commissioner and that this occurrence was "entirely the result of the operation" of the Act and the Rules, without any intervention or discretionary power on the part of the Commissioner.
[25] Therefore, according to the respondent, this Court is without jurisdiction, pursuant to section 18.1 of the Federal Courts Act, to set aside the non-reinstatement on the grounds suggested by the applicant, as there is no "decision" flowing from a federal board, commission or tribunal. Rather, the challenged result arises only by operation of the legislation. The respondent submits that the Court may only determine whether, as a matter of fact, the applicant completed the necessary actions to reinstate his application and if so, declare the application reinstated.
[26] The respondent refers to the provisions in the Act and Rules that address payment of maintenance fees and the process for reinstating an abandoned application. The respondent characterizes these provisions as "non-discretionary" or having "declaratory effect". The respondent submits that there is a mandatory requirement to pay fees at particular times and a mandatory consequence of failure to pay. The respondent argues that neither the Commissioner nor the Court has jurisdiction to modify, set aside or ignore these mandatory provisions.
[27] The respondent relies on Pfizer v. Canada, [2000] F.C.J. No. 1801 (C.A.)(QL) and, by analogy, on Hopkinson v. Canada, [1997] F.C.J. No. 848 (T.D.)(QL), aff'd [2000] F.C.J. No. 492 (C.A.)(QL). For the sake of contrast, the respondent also sets out several provisions of the Act that confer an actual duty or power on the Commissioner.
[28] The respondent also relies on Barton No-till Disk Inc. et al., supra and the recent decision of F. Hoffmann-La Roche AG. v. Canada (Commissioner of Patents), [2003] F.C.J. No. 1760 (T.D.)(QL).
[29] The respondent argues that the applicant has presented no evidence that the June 20, 2002 document and payment, requesting reinstatement pursuant to subsection 73(1)(c) of the Act were in fact transmitted to and received by the Patent Office. The applicant, instead, has presented indirect evidence that such transmittal did not occur. The respondent argues that, on a balance of probabilities, the applicant has not demonstrated that the request for reinstatement and appropriate payments were in fact made as required by the Act and the Rules.
[30] The respondent also submits that this Court should be mindful of narrowing the effect of any decision in favour of the applicant, to avoid encouragement of "inappropriate" future litigation over reinstatement of applications. If this Court is to allow this application, the respondent requests that the relief be limited to a declaration that the patent application be reinstated because the applicant fulfilled the requirements of the legislation.
ISSUES
[31] 1. Is judicial review available in the present case?
2. Has the applicant demonstrated that the doctrine of legitimate expectations is applicable and that he was therefore denied procedural fairness?
ANALYSIS
[32] In my view, the scope of judicial review jurisdiction provided in section 18.1 of the Federal Courts Act is broad enough to encompass the current situation. The respondent argues that the Commissioner did not make any "decision" that can be judicially reviewed, as the applicant's application was deemed abandoned and not properly reinstated by only the mandatory operation of the legislation. In response to a similar argument that the Commissioner did not make any "decision" or "order", Justice O'Reilly in F. Hoffmann-LaRoche, supra, held that judicial review was available in respect of the Commissioner's notice to the applicant that its patent had lapsed for failure to pay the proper maintenance fees. Such action by the Commissioner was, properly in my opinion, found to be within the ambit of subsection 18.1(3) of the Federal Courts Act, that is, a "decision, order, act or proceeding of a federal board, commission or other tribunal".
[33] The decisions of Larny Holdings Ltd. (c.o.b. Quickie Convenience Stores) v. Canada (Minister of Health), [2003] 1 F.C. 541 (T.D.) and Morneault v. Canada (Attorney General), [2001] 1 F.C. 30 (C.A.) support my conclusion that the challenged matter in the present case is properly within the scope of judicial review provided by section 18.1 of the Federal Courts Act. At page 555 of Larny Holdings Ltd, supra, Justice Nadon, as he then was, stated as follows:
Mr. Justice Stone's remarks in Morneault, supra, [at paras 40-45] like those of Décary J.A. in Gestion Complexe, supra, are to the effect that judicial review under section 18 of the Act must be given a broad and liberal interpretation, as a result of which a wide range of administrative actions will fall within the Court's judicial review mandate. It is also clear that judicial review is no longer restricted to decisions or orders that a decision maker was expressly charged to make under the enabling legislation. Rather, judicial review will extend to decisions or orders that determine a party's rights, even if the decision at issue is not the ultimate decision. It also follows from the Court of Appeal's decision in Morneault, supra, that the word "matter" found in section 18.1 of the Act is not restricted to "decisions or orders", but encompasses any matter in regard to which a remedy might be available under section 18 or subsection 18.1(3).
[34] Moving now to the applicant's argument that he was denied procedural fairness through the Commissioner's actions, in that he had a legitimate expectation that certain procedures would be followed, I am not satisfied that the Office's "usual practices" created a duty of the Commissioner to inform the applicant that his request for reinstatement and payment of the required fee had not been received. In my view, the Act is clear that an applicant must be held responsible for not allowing his application to become irrevocably abandoned and, as I will outline below, I am not satisfied that the Office created a legitimate expectation for the applicant that the paragraph 73(1)(c) reinstatement request had, in fact, been received.
[35] Sections 27.1(1), 73(1)(c) and (d) and 73(3) of the Act provide that an applicant has the duty to pay maintenance fees, as may be prescribed, and sets out the procedure to be followed for abandonment and reinstatement of applications if such fees are not paid. These provisions read as follows:
| 27.1 (1) An applicant for a patent shall, to maintain the application in effect, pay to the Commissioner such fees, in respect of such periods, as may be prescribed. 73. (1) An application for a patent in Canada shall be deemed to be abandoned if the applicant does not ...
(c) pay the fees payable under section 27.1, within the time provided by the regulations; (d) make a request for examination or pay the prescribed fee under subsection 35(1) within the time provided by the regulations;
... 73 (3) An application deemed to be abandoned under this section shall be reinstated if the applicant
(a) makes a request for reinstatement to the Commissioner within the prescribed period;
(b) takes the action that should have been taken in order to avoid the abandonment; and
(c) pays the prescribed fee before the expiration of the prescribed period. |
|
27.1 (1) Le demandeur est tenu de payer au commissaire, afin de maintenir sa demande en état, les taxes réglementaires pour chaque période réglementaire.
73. (1) La demande de brevet est considérée comme abandonnée si le demandeur omet, selon le cas : ...
c) de payer, dans le délai réglementaire, les taxes visées à l'article 27.1;
d) de présenter la requête visée au paragraphe 35(1) ou de payer la taxe réglementaire dans le délai réglementaire;
...
73 (3) Elle peut être rétablie si le demandeur :
a) présente au commissaire, dans le délai réglementaire, une requête à cet effet;
b) prend les mesures qui s'imposaient pour éviter l'abandon;
c) paie les taxes réglementaires avant l'expiration de la période réglementaire.
|
[36] Section 152 of the Rules provides as follows:
| 152. In order for an application deemed to be abandoned under section 73 of the Act to be reinstated, the applicant must, in respect of each failure to take an action referred to in subsection 73(1) of the Act or section 151, make a request for reinstatement to the Commissioner, take the action that should have been taken in order to avoid the deemed abandonment and pay the fee set out in item 7 of Schedule II before the expiry of the twelve-month period after the date on which the application is deemed to be abandoned as a result of that failure.
|
|
152. Pour que la demande considérée comme abandonnée en application de l'article 73 de la Loi soit rétablie, le demandeur, à l'égard de chaque omission mentionnée au paragraphe 73(1) de la Loi ou visée à l'article 151, présente au commissaire une requête à cet effet, prend les mesures qui s'imposaient pour éviter la présomption d'abandon et paie la taxe prévue à l'article 7 de l'annexe II, dans les douze mois suivant la date de prise d'effet de la présomption d'abandon.
|
[37] The legitimate expectations doctrine has been recognized in Canada as allowing for procedural protection for applicants to be consulted or make representations, in certain circumstances. Justice Sopinka described the basis of this doctrine in Old St. Boniface Residents Association Inc. v. Winnipeg (City), [1990] 3 S.C.R. 1170 at page 1204 as follows:
The principle developed in these cases is simply an extension of the rules of natural justice and procedural fairness. It affords a party affected by the decision of a public official an opportunity to make representations in circumstances in which there otherwise would be no such opportunity. The court supplies the omission where, based on the conduct of the public official, a party has been led to believe that his or her rights would not be affected without consultation.
[38] Further, as stated by Justice L'Heureux-Dubé in Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817, at page 840:
...This doctrine, as applied in Canada, is based on the principle that the "circumstances" affecting procedural fairness take into account the promises or regular practices of administrative decision-makers, and that it will generally be unfair for them to act in contravention of representations as to procedure,...
[39] Did the Commissioner, through the past practices of the Office, represent that a particular procedure would be followed in the event that an applicant's request and payment for reinstatement on one section 73 ground is received by the Office and such request and payment for reinstatement on another ground is not? In other words, did past practices of the Office, and particularly the fact that the applicant received an "Acknowledgment of Request for Examination", without further contact from the Office, lead the applicant to legitimately expect that his application had been reinstated pursuant to both grounds of abandonment?
[40] The legitimate expectations doctrine is meant to apply to situations where an applicant has been led to believe that he will have a right to make representations to, or be consulted by, a government decision-maker, prior to a particular decision. I am not persuaded that this doctrine applies to the situation where an administrative body has allegedly, in past situations, brought deficiencies in the filing process to an applicant's attention, so as to create an expectation that the Commissioner will catch each slip, even inadvertent ones, of an applicant in the reinstatement process. The Commissioner has no duty to provide notice to an applicant that an application has not been properly reinstated, when the obligation to reinstate an abandoned application, by submitting certain, prescribed materials and fees, is clearly placed on the shoulders of the applicant by the legislative scheme. If the applicant's submission as to legitimate expectations is accepted, a positive obligation would be placed on the Commissioner to inform applicants, on its own initiative, of any deficiency in the materials filed in the reinstatement process.
[41] The sending of the "Acknowledgment of Request for Examination" notice does not create a legitimate expectation that an application is fully reinstated pursuant to all grounds for which abandonment may have occurred pursuant to section 73(1). This notice states that the request for examination and prescribed fee "have been received" and that examination of the application "will take place in due course". I am not satisfied that this wording conveys any sort of reasonable expectation that an application is fully reinstated, on all grounds of abandonment, and the fact that the applicant's representatives had in previous dealings interpreted this notice in this manner is not sufficient for a legitimate expectation to arise, in light of the clear wording of Rule 152. This Rule explicitly states that in order for an application that is deemed abandoned under section 73 of the Act to be reinstated, an applicant must, "in respect of each failure to take an action referred to in subsection 73(1) of the Act or section 151," make a request for reinstatement to the Commissioner and take the action that should have been taken in order to avoid the deemed abandonment.
[42] Moreover, in Hoffmann-La Roche, supra, the court held that there was no duty on the Commissioner to give an applicant notice that its patent was about to lapse pursuant to subsection 46(2) of the Act, even where the applicant placed reliance on the Commissioner's general practice of delivering notice when an initial deadline was missed. Such past practice in that case was, to quote Justice O'Reilly at paragraph 38 "...not enough to create a corresponding duty on the part of the Commissioner". In that case, the court noted that the limited role of the Commissioner in relation to the mandatory payment of maintenance fees did not allow for acceptance of the legitimate expectations doctrine. In my view, such reasoning is applicable to the present case.
[43] The object of the annual maintenance fee provisions, as stated by the Federal Court of Appeal in Barton No-till Disk Inc. et al., supra, is to provide for defrayment of the costs of administering the patent regime and also to discourage the proliferation of "deadwood" patents and patent applications by requiring patentees to take steps on an annual basis to keep them in good standing. While the affidavit evidence filed in this proceeding reveals that the application in the present case was not intended to be abandoned, I am satisfied that the maintenance fee provisions of the Act and the Rules must be interpreted strictly by the Commissioner, and also this Court, in order to ensure compliance by applicants through the timely and diligent filing of fees.
[44] It is clear that the Commissioner has no authority pursuant to the Act and the Rules to extend the deadline for payment of maintenance fees: Pfizer Inc., supra, and Barton No-till Disk Inc. et al., supra.
[45] The Court in Barton No-till Disk Inc. et al., supra, recognized that the maintenance fee regime is complicated and that there is a risk of innocent error in compliance that could have "catastrophic consequences". In that case the patent holder was given the benefit of ambiguity in statutory provisions dealing with the payment of maintenance fees on the "small entity" scale. There is no ambiguity in the enactments relating to the situation before me.
[46] The evidence is clear that the applicant's agents took steps to satisfy the requirements for reinstatement prior to the expiry of the applicable time period. Unfortunately, it is also clear that those steps were not completed and the agents did not ensure that the requests for reinstatement on both grounds had in fact been made to the Commissioner and the necessary fees paid in accordance with Rule 152, before the expiry of the twelve month period during which reinstatement could be achieved. They chose to rely on the Commissioner's informal practise of notifying agents that applications were not in good standing prior to the expiry of that period. As I have concluded above, the Commissioner was under no duty to provide such notice. In the circumstances, I can find no remedy for the applicant.
ORDER
THIS COURT ORDERS that this application for judicial review is dismissed.
Costs to the respondent.
"Richard G. Mosley"
F.C.J.
FEDERAL COURT
SOLICITORS OF RECORD
DOCKET: T-643-03
STYLE OF CAUSE: PETER EIBA
AND
ATTORNEY GENERAL OF CANADA
PLACE OF HEARING: Ottawa, Ontario
DATE OF HEARING: February 10, 2004
REASONS FOR ORDER
AND ORDER BY: The Honourable Mr. Justice Mosley
DATED: February 19, 2004
APPEARANCES:
Teresa Martin FOR THE APPLICANT
F.B. (Rick) Woyiwada FOR THE RESPONDENT
SOLICITORS OF RECORD:
TERESA MARTIN FOR THE APPLICANT
Shapiro Cohen
Barristers & Solicitors
Ottawa, Ontario
MORRIS ROSENBERG FOR THE RESPONDENT
Deputy Attorney General of Canada
Ottawa, Ontario