TRADE MARKS
Retrospective extensions of time in NZ trade mark proceedings: a thing of the past?
A recent High Court decision has resulted in a significant change in the practice of IPONZ in granting extensions of time in trade mark proceedings. Ian Finch and Ben Cain explain
Until December 2009, the Commissioner of Trade Marks usually granted extensions of time (to file evidence, for example) in trade mark proceedings as long as the application was filed with the Intellectual Property Office of New Zealand (IPONZ) on or before the applicable deadline. Occasionally, if an application was made after the applicable deadline, the Commissioner would still grant the extension by exercising his perceived discretion to do so under regulation 32 of the Trade Mark Regulations 2003 (Regulations).
On 18 December 2009, however, Justice Lang held in The Muir Electrical Company Pty Ltd v The Good Guys Group Ltd (High Court, Auckland CIV-2009-404-4965) that the Regulations did not permit the granting of general extensions of time if they were applied for after the applicable deadline (ie retrospectively).
Muir Electrical
Muir Electrical concerned an application by The Good Guys Group under section 65 of the Trade Marks Act 2002 (Act) to revoke a number of trade marks owned by Muir Electrical for non-use under section 66 of the Act. During the revocation process, The Good Guys Group failed to notify IPONZ that it did not intend to file evidence in support of its revocation action, as it was required to do under regulation 98.
Having realised its error after the deadline for doing so had passed, The Good Guys Group applied for a retrospective extension of time to provide the notification under regulation 32. The Commissioner granted the extension retrospectively, as it had done previously (see Natural Health New Zealand 2002 Ltd v Omni Nutraceuticals Ltd (T20/2004, 7 September 2004, Assistant Commissioner Walden); Re Sanofi Pasteur (T14/2008, 9 June 2008, Assistant Commissioner Walden)), using the broad discretion conferred by regulation 32. Muir Electrical appealed to the High Court.
The issues
There were two issues:
• Whether the Commissioner had the discretionary power to grant extensions of time retrospectively; and
• If the answer to above was “yes”, whether the circumstances in this particular case qualified as “genuine and exceptional circumstances” required under regulation 32.
This article focuses upon the first issue.
The relevant regulations
Under regulation 32, the Commissioner has a general power to extend time for taking steps in trade mark proceedings in New Zealand, except where the regulations specifically prohibit an extension, provided there are genuine and exceptional circumstances to justify the extension.
Regulation 98 specifies a time frame for taking a step in a revocation proceeding, but does not explicitly exclude the granting of an extension of time after the deadline has passed.
Although not directly relevant to the revocation proceedings, regulation 75 was used as a yardstick against which the wording of regulation 98 was measured. Regulation 75 specifies a time frame and allows for extension of that time frame, but, in contrast to regulation 98, expressly stipulates that the time frame may not be extended once the deadline has expired.
Counsel’s arguments
Counsel for Muir Electrical submitted that regulation 32 did not grant the power to retrospectively grant extensions. Counsel argued that regulation 32 differed significantly from its predecessor, regulation 93 of the Trade Marks Regulations 1954, which stated that an extension of time could be granted “though the time has expired for doing the act or taking the proceeding”. Counsel argued that since this phrase had not been carried forward into the 2003 Regulations, it was Parliament’s intention that such extensions could no longer be granted.
Counsel for Muir Electrical further argued against a retrospective grant of extensions of time on the basis that regulation 98 is a mirror provision of regulation 75 and similar provisions (for example, regulation 43 dealing with the addition of classes to a trade mark application), which have self-contained powers of extension that override the general power in regulation 32. On counsel’s submission, even though regulation 98 contained no express bar on the granting of extensions of time retrospectively, an implicit bar should be read in.
In reply, counsel for The Good Guys Group argued that regulation 32 does not expressly prohibit the Commissioner from granting an extension in circumstances where the time for taking a step has expired. Neither does regulation 32 expressly prohibit the Commissioner from granting an extension where the party seeking the extension is taken to have discontinued its application or opposition by failing to file its evidence within the prescribed time. As Justice Lang paraphrased at [57], counsel submitted that:
“[I]f Parliament had wanted to prevent the Commissioner from granting extensions in the present situation, it could easily have included an express provision to that effect within Regulation 32(1)… [T]he absence of such a prohibition confirms that the general power to grant an extension is available in circumstances such as the present.”
Furthermore, if no power to grant extensions of time retrospectively existed at all, there would be no need to expressly restrict such power as in regulation 75 (which provides that the deadline to file a Notice of Opposition cannot be extended after the deadline has expired); it simply would be a non-issue.
Decision
Justice Lang held that the Commissioner has no general discretionary power under regulation 32 to grant extensions of time retrospectively, stating at [27] (emphasis added):
“[T]he omission of this power from the 2003 regulations clearly signals Parliament’s intention that the Commissioner should have no power to grant an extension of time where the extension is sought after the time for performing an act or taking a step has already passed.”
On the absence of an explicit bar on retrospective extensions in regulation 98, Justice Lang considered (at [58]) that:
“[U]nlike the regulations that contain an express limit or prohibition on the power to grant an extension, regulations such as Regulation 98 provide their own consequences for any failure to comply with a procedural step within the prescribed period. Parliament has determined that, if a party does not comply with the obligations that those regulations impose, that party’s application or opposition is discontinued and is at an end. It is therefore not surprising that Parliament did not feel the need to cater for this type of situation by making it a further exception under Regulation 32(1).”
Justice Lang stated that the “critical factor is whether the extension is sought before the expiry of the current deadline”. The wording of regulation 32, Justice Lang said, cannot be “taken to imply that the Commissioner has any power to extend a deadline retrospectively. An extension of a deadline can only be valid if the Commissioner has the necessary power to grant it in the first place”.
In this case, counsel for The Good Guys Group had sought the extension after the expiry of the two-month period under regulation 98. Justice Lang thus held that the Commissioner was wrong to grant the extension on the basis he did not have the discretionary power to do so.
With regard to regulation 75, even though this regulation was not at issue, Justice Lang held that there is no power for the Commissioner to grant an extension of time for filing a Notice of Opposition under regulation 75(3) after the expiry of the applicable deadline, even where the application was received by the Commissioner prior to the deadline. Justice Lang stated (at [31]) (emphasis added):
“Regulation 75(3) prohibits the Commissioner from extending the deadline after the deadline has expired. I take the effect of this to be that the Commissioner has no power to extend the date for filing a notice of opposition unless the extension is both requested and granted before the expiry of the three month deadline contained within Regulation 75(1). That prohibition clearly overrides the general power conferred by Regulation 32, because that power may not be exercised ‘where [the] regulations stipulate that time must not be extended’.”
Comment
The upshot of Justice Lang’s judgment is that:
• The Commissioner would no longer appear to have the power to grant any extension of time in trade mark proceedings where the application is made after the relevant deadline has passed; and
• In the case of applications to extend the period for filing a Notice of Opposition, the extension must be both filed and granted before expiry of the relevant deadline.
But is the decision right?
Regulation 32 states that the Commissioner may “extend the time specified by these regulations for a step to be taken” if satisfied that there are “genuine and exceptional circumstances” that justify an extension of time. It is critical to the interpretation of regulation 32 that there is no temporal element to the test; that is, whether an applicant has to apply and show genuine and exceptional circumstances before or after the relevant specified time.
Genuine and exceptional circumstances may arise either because of an unconscious omission by a party, or a conscious external act of a party, either of which detrimentally affects a step in a proceeding. In the former case, the relevant circumstances may not come to light until after a deadline has passed, as in Muir. It is only at this post-facto point of realisation that the circumstances will present themselves as “genuine and exceptional” to the affected party and an application can be made. It is a question of fact in every case. Read in this way, regulation 32 may cater for both pre- and post-deadline discovery of genuine and exceptional circumstances. To restrict the Commissioner’s discretion to only pre-deadline applications, as Justice Lang did, arguably removes the Commissioner’s discretionary power when it is needed most.
IPONZ Practice Note
On 25 February 2010, the Hearings Office at IPONZ published a practice note on its website, stating the Hearings Office “has adopted a new practice in relation to the time for filing a notice of opposition to the registration of a trade mark”. The new practice “reflects the High Court decision in [Muir Electrical]” in relation to regulation 75.
The Hearings Office will henceforth endeavour to consider and process an extension of time for filing a notice of opposition under regulation 75 within five working days. Should applications for extension of time be received less than five working days prior to the deadline, the Hearings Office “will take all reasonable steps” to ensure that such applications are considered and determined prior to the expiry of the applicable deadline. The Hearings Office states, however:
“No guarantee can be provided that such applications will be able to be processed in time – especially in cases where applications are received on the final day before expiry of the deadline.”
Summary
Before Muir, the Commissioner had granted retrospective extensions of time under the Regulations on the basis that, if they did not expressly forbid doing so, the Regulations impliedly granted the Commissioner the discretionary power to do so. Following Muir, there is no power at all to grant general extensions retrospectively and the applicable deadline must be adhered to or extended before expiry. In terms of Muir, the moral of the story is to keep a careful eye on your diary!