A-1094-90
Celliers du Monde Inc. (Appellant) (Defendant)
v.
Dumont Vins & Spiritueux Inc. (Respondent)
(Plaintiff)
INDEXED AS: DUMONT VINS & SPIRITUEUX INC. V. CELLIERS
DU MONDE INC. (C.A.)
Court of Appeal, Marceau, Desjardins and Décary
JJ.A.—Montréal, February 6; Ottawa, February 17,
1992.
Practice — Res judicata — Plaintiff marketing L'Oiseau
Bleu, light white wine, in opaque white Hock bottle with blue
labelling — Defendant bringing out L'Ombrelle, light white
wine, in opaque white Hock bottle with blue labelling — Plain
tiff suing in Quebec Superior Court for passing off and
infringement of unregistered trade mark — Superior Court
stating white bottle cannot be trade mark, giving judgment for
passing off — Defendant returning L'Ombrelle to market in
saine bottle with black and gold labelling — Plaintiff suing in
Federal Court for infringement of unregistered trade mark and
passing off — Whether Superior Court Judge's remarks on
invalidity of unregistered trade mark ratio decidendi — Rea
soning not required to be repeated in disposition to be ratio
decidendi — Where Court giving judgment on two issues, both
decisions rationes decidendi — Res judicata not limited to
holding, but including reasons — Res judicata where parties,
object, cause identical.
Trade marks — Infringement — Plaintiff marketing light
white wine, L'Oiseau Bleu, in white opaque Hock bottle with
blue label and neck band — Becoming most popular light
white wine in Québec — Defendant bringing to market light
white wine, L'Ombrelle, in opaque white Hock bottle with blue
label and neck band — Plaintiff suing in Quebec Superior
Court for passing off and infringement of unregistered trade
mark — Succeeding on issue of passing off — Superior Court
Judge stating white Hock bottle cannot be unregistered trade
mark — Increase in sales not conferring necessary distinctive
ness.
Federal Court jurisdiction — Trial Division — Concurrent
jurisdiction in trade mark matters — No jurisdiction over
action in passing off in absence of trade mark.
This was an appeal from a Trial Division order dismissing
the defendant's motion on a preliminary objection that the Fed
eral Court was without jurisdiction to try the principal action.
Since 1984, the plaintiff has been marketing, mainly through
licensed grocery stores in the province of Quebec, L'Oiseau
Bleu, a light white wine in an opaque white Hock bottle with
blue label and neck band. It has become the best-selling light
white wine in the Province. The plaintiff registered the name
"L'Oiseau Bleu" in 1985. It applied, in February, 1989, to reg
ister the white bottle, and the white bottle with blue labelling,
as two trade marks. These applications are still pending. In
March, 1989, the defendant brought to market a light white
wine, L'Ombrelle, in an opaque white Hock bottle with blue
labelling. The plaintiff brought an action in Quebec Superior
Court alleging passing off and infringement of an unregistered
trade mark. That Court stated the white bottle could not be a
trade mark, but gave the plaintiff judgment for passing off.
Shortly thereafter, the defendant resumed the sale of L'Om-
brelle in the same bottle, but with black and gold labelling. The
plaintiff brought the instant action in Federal Court, alleging
infringement of an unregistered trade mark, whereupon the
defendant entered a conditional appearance for the purpose of
objecting to the jurisdiction of the Court. The Trial Judge held
that the remarks of the Quebec Superior Court Judge about
infringement of an unregistered trade mark were obiter and,
therefore, that issue was not res judicata between the parties.
Held, the appeal should be allowed.
A statement in reasons for judgment on one of the very mat
ters in issue does not become obiter dictum just because it is
not expressly reflected in the order. Two issues were put before
the Superior Court, argued by the parties, and ruled on by that
Court. It was not necessary that the Court, in giving judgment
for the plaintiff, advert to the issue of the validity of the
alleged unregistered trade mark, on which the plaintiff was
unsuccessful, for its reasons on that issue to be part of the ratio
decidendi. This is not a case where a court has given several
different reasons for its decision on a single issue; rather, there
were two issues before the Superior Court, and two decisions.
Either issue could have been the subject of an action by itself,
and the reasons for both decisions are rationes decidendi.
For a matter to be res judicata, the parties, the object of the
action and its cause must be identical. Here, only the cause,
which is the legal characterization of the facts alleged, is dis
puted. The matter of passing off is not res judicata, as the
defendant's new packaging is a distinct cause; but, on the
question of infringement of an unregistered trademark, it is the
plaintiff's bottle which is the cause, and that remains the same.
That the plaintiff's sales have grown does not permit the bottle
to acquire a distinctiveness the Superior Court held it did not
have. The invalidity of the bottle as an unregistered trade mark
is therefore res judicata between the parties.
For the Federal Court to have jurisdiction there must be an
existing body of federal law which is essential to the disposi
tion of the case. Section 7 of the Trade-marks Act gives the
Court jurisdiction over an action in passing off only where it is
related to a trade mark, registered or unregistered. Since the
issue of the unregistered trade mark is res judicata between the
parties, the Court is without jurisdiction to hear the action in
passing off.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Federal Court Act, R.S.C., 1985, c. F-7, s. 20(2).
Federal Court Rules, C.R.C., c. 663, R. 401.
Trade-marks Act, R.S.C., 1985, c. T-13, ss. 7, 55.
CASES JUDICIALLY CONSIDERED
APPLIED:
Canadian Shredded Wheat Co. Ltd. v. Kellogg Co. of
Canada, [1939] S.C.R. 329; [1939] 3 D.L.R. 641.
CONSIDERED:
Dumont vins et spiritueux Inc. c. Celliers du Monde Inc.,
[1990] R.J.Q. 556 (S.C.); Roland Jacques Inc. c.
Laboratoire Dr. Renaud Inc., [1980] C.A. 553 (Que.);
Rocois Construction Inc. v. Québec Ready Mix Inc.,
[1990] 2 S.C.R. 440; (1990), Q.A.C. 241; 112 N.R. 241;
MacDonald et al. v. Vapor Canada Ltd., [1977] 2 S.C.R.
134; (1976), 66 D.L.R. (3d) 1; 22 C.P.R. (2d) I; 7 N.R.
477; Asbjorn Horgard AIS v. Gibbs/Nortac Industries
Ltd., [1987] 3 F.C. 544; (1987), 38 D.L.R. (4th) 544; 17
C.I.P.R. 263; 14 C.P.R. (3d) 314; 12 F.T.R. 317; 80 N.R.
9 (C.A.).
REFERRED TO:
Ellard v. Millar, [1930] S.C.R. 319; Vachon c. Frenette-
Vachon, [1978] C.A. 515 (Que.); Roberge v. Bolduc,
[1991] 1 S.C.R. 374; (1991), 78 D.L.R. (4th) 666; ITO—
International Terminal Operators Ltd. v. Miida Electron
ics Inc. et al., [1986] 1 S.C.R. 752; (1986), 28 D.L.R.
(4th) 641; 34 B.L.R. 251; 68 N.R. 241; Kigowa v.
Canada, [1990] 1 F.C. 804; (1990), 67 D.L.R. (4th) 305;
10 Imm. L.R. (2d) 161; 105 N.R. 278 (C.A.); Southam
Inc. v. Canada (Attorney General), [1990] 3 F.C. 465;
(1990), 73 D.L.R. (4th) 289 (C.A.); Promotions Atlanti-
ques Inc. v. Hardcraft Industries Ltd. (1987), 13 C.I.P.R.
194; 17 C.P.R. (3d) 552; 13 F.T.R. 113 (F.C.T.D.);
Québec Ready Mix Inc. v. Rocois Construction Inc.,
[1989] 1 S.C.R. 695; (1989), 60 D.L.R. (4th) 124; 48
C.C.C. (3d) 501; 25 C.P.R. (3d) 304; 93 N.R. 388.
AUTHORS CITED
Ducharme, L. Précis de la preuve, 3e éd., Montréal: Wil-
son et Lafleur, 1986.
Mayrand, Albert. Dictionnaire de maximes et locutions
latines utilisées en droit, Cowansville, Qué.: Les Edi
tions Yvon Blais Inc., 1985, "Obiter dictum", "Ratio
decidendi".
Mignault, P.-B. Le droit civil canadien, tome VI, Mon-
tréal: Librairie de droit et de jurisprudence, 1902.
Nadeau, André and Léo Ducharme. Traité de droit civil
du Québec, tome IX, Montréal: Wilson et Lafleur,
1965.
Planiol, Marcel and Georges Ripert. Traité pratique de
droit civil français, 2e éd., tome VII, Montréal:
Librairie générale de droit et de jurisprudence, 1954.
Royer, Jean-Claude. La preuve civile, Cowansville (Qué.):
Les Editions Yvon Blais Inc., 1987.
APPEAL from an order of the Trial Division,
T-2697-90, Denault J., 4/12/90, not reported, dis
missing a motion objecting to the jurisdiction of the
Court. Appeal allowed.
COUNSEL:
Ian MacPhee for appellant (defendant).
Louis Carbonneau for respondent (plaintiff).
SOLICITORS:
Lapointe Rosenstein, Montréal, for appellant
(defendant).
Clark Woods Rochefort Fortier, Montréal, for
respondent (defendant).
The following is the English version of the reasons
for judgment rendered by
DÉCARY J.A.: Does L'Ombrelle cast a shadow on
L'Oiseau Bleu? This is how Mr. Justice André Forget
of the Superior Court of Quebec on January 18, 1990
began a long judgment which is central to the case at
bar. 1 In this Court, the discussion took a slightly dif
ferent form and we have to decide whether L'Oiseau
Bleu can now eclipse L'Ombrelle in the Federal
Court.
[ 1990] R.J.Q. 556.
A brief review of the facts and a short description
of the parties chiefly concerned are necessary.
The respondent Dumont Vins & Spiritueux Inc. is
engaged in the sale of wines which for the most part
are bottled in Quebec and which it sells primarily
through a network of licensed grocers. In October
1984 it brought out, under the mark "L'Oiseau Bleu",
an opaque bottle of white wine of the Hock (Alsace)
type which soon became the best-selling light white
wine in Quebec. The mark "L'Oiseau Bleu" was reg
istered with the Registrar of Trade Marks on August
16, 1985. On February 16, 1989 the respondent filed
with the said Registrar two applications to register a
distinguishing guise, one its white bottle and the
other its white bottle and presentation, namely a
label, collar and a seal cap in blue. These two appli
cations are still pending, but on September 24 and
October 1, 1991 the Registrar informed the respon
dent that, if allowed, these registrations would be
limited to the province of Quebec.
The appellant, Celliers du Monde Inc., is one of
the respondent's competitors. In March 1989 it
placed a bottle of light white wine on the market
under the mark "L'Ombrelle": the bottle was white
and a Hock shape with a mainly blue presentation.
On March 1, 1989 the respondent applied to the
Quebec Superior Court for an injunction against the
appellant. In this application for an injunction the
respondent sought an order directing the appellant
[TRANSLATION] ... its shareholders, associates, employees, rep
resentatives, agents, licensees, customers and assignees ... to
forthwith cease, directly or indirectly:
(i) USING a white bottle in connection with the marketing of
any alcoholic product or otherwise directing public attention to
its wares in such a way as to cause or be likely to cause confu
sion in Canada between its products and the table wine sold by
the applicant in a white bottle under the mark "L'Oiseau Bleu"
or to pass off its wares when the goods ordered or requested
are the applicant's L'oiseau bleu wine;
(ii) USING, in connection with its products or the advertising
or promotion of its products, the mark "L'Oiseau Bleu", the
distinguishing drawing of a white bottle or the distinguishing
drawing of a white bottle with the applicant's blue label.
On January 18, 1990 Forget J. rendered the judg
ment to which I have referred above and from which
it is necessary to quote at length [at pages 558-566]:
[TRANSLATION] I. Facts
11. Basis of remedy
The plaintiff bases its remedy both on the alleged infringe
ment of an unregistered trade mark and the offence of passing
off.
III. Similarity and dissimilarity
IV. Burden of proof
A. Infringement of unregistered trade mark
The evidence submitted in the instant case does not provide
a basis for concluding that an unregistered trade mark has been
infringed. The Court is not persuaded that the plaintiff has
established a distinguishing guise allowing it to claim exclu
sive rights to its opaque Hock type white bottle with a blue
label.
To begin with, the Hock (Alsace) type bottle is in common
use. It is true that Dumont appears to be the only Quebec pro
ducer to have used the opaque white Hock bottle to sell a light
white wine, but the Court is not persuaded that this gives it the
right to exclusive use of a white-painted bottle of this shape.
Counsel for Celliers referred to the theory of exhaustion of
colours. If one manufacturer monopolizes white, a second blue,
a third green and so on, future competitors will in this way be
eliminated. This theory was set out in a U.S. case, Campbell
Soup Co. v. Armour & Co. (175 F. 2d 795 (1949), 798):
If they may thus monopolize red in all of its shades the next
manufacturer may monopolize orange in all of its shades
and the next yellow in the same way. Obviously, the list of
colours will soon run out.
The Court accordingly considers that the plaintiff did not
succeed in establishing that an unregistered trade mark had
been infringed.
B. Offence of passing off
The Court is however persuaded that Celliers committed an
offence of passing off ... .
For these reasons, the Court
Declares that by marketing a white wine bottle designated
under the trade name "L'Ombrelle" similar to that entered in
the record as No. P-11, the defendant passed off its product as
that marketed by the plaintiff under the trade name "L'Oiseau
Bleu" ;
Issues an order for a permanent injunction directing the
defendant and its officers, directors, shareholders, associates,
employees, representatives, agents, assignees and any other
person having knowledge of the said order, to forthwith cease,
directly or indirectly:
marketing, selling, offering for sale or advertising a wine in
packaging identical to that entered in the record as No. P-11 so
as to direct public attention to its wares or business in such a
way as to cause or be likely to cause confusion between its
wares or business and those of the plaintiff, and to pass the
wine "L'Ombrelle" off as the wine "L'Oiseau Bleu", in any
format whatsoever;
The whole with all costs against the defendant.
On January 26, 1990 the appellant appealed this
decision to the Quebec Court of Appeal; on July 4,
1990 it discontinued its appeal. The respondent did
not appeal from the decision.
In May 1990, the appellant reintroduced its wine
"L'Ombrelle" in a new bottle which was still opaque
white and Hock-shaped and the presentation of which
(labels and seal cap) were similar, in the respondent's
submission, to the original presentation except as to
colour, black and gold having replaced blue.
On October 10, 1990 the respondent again applied
for an injunction against the appellant in respect of
this new bottle, but this time it chose to make its
application to the Federal Court rather than to the
Quebec Superior Court. The conclusions sought in
the Federal Court are as follows:
[TRANSLATION] A) ALLOW the action at bar;
B) DECLARE that the defendant Celliers by marketing its
wine "L'Ombrelle" in Canada has directed public attention
to its wares, services or business in such a way as to cause
or be likely to cause confusion in Canada between its wine
"L'Ombrelle" and the wine "L'Oiseau Bleu" marketed by
the plaintiff Dumont, contrary to the provisions of s. 7(b) of
the Trade Marks Act;
C) DECLARE that the defendant Celliers has thereby
engaged in business practices contrary to honest industrial
or commercial usage in Canada;
D) DECLARE that the defendant Celliers has passed off its
light white wines as those of the plaintiff Dumont contrary
to the provisions of paragraph 7(c) of the Trade Marks Act;
E) MAKE an order for an interlocutory injunction directing
the defendant Celliers, its shareholders, associates, employ
ees, representatives, agents, licensees, customers, assignees
and any other person having knowledge of the said order to
forthwith cease, directly or indirectly:
(i) employing or using a white bottle or allowing a white
bottle to be employed or used in association with the
import and/or manufacture, marketing, promotion, sale
and distribution of wine;
(ii) using a white bottle or allowing a white bottle to be
used on advertising material, prospectuses, invoices, busi
ness cards, signs, showcases, catalogues, labels, advertis
ing or any other commercial or promotional material in
association with wine;
(iii) directing public attention to its wines or business in
such a way as to cause or be likely to cause confusion in
Canada between its wines or business and the wines or
business of the plaintiff Dumont;
(iv) passing off its wines or its business as those of the
plaintiff Dumont;
(v) any act of unfair competition contrary to honest indus
trial or commercial usage in Canada by the use of a white
bottle in association with the sale of wine;
(vi) cease diverting the plaintiff's trade mark white bottle
from its function and nature as a trade mark;
F) GRANT the plaintiff a final injunction against the defen
dant according to the terms and conditions mentioned in the
foregoing paragraph;....
On November 30, 1990 the appellant, having
received leave to do so, filed a conditional appear
ance under Rule 401 [Federal Court Rules, C.R.C., c.
663] for the purpose of objecting to the Court's juris
diction. The bases of this objection were the follow
ing: the question of the infringement of an unregis
tered trade mark was res judicata between the parties
and so, since there was no trade mark, the Federal
Court had no jurisdiction to hear a case simply
involving the offence of passing off.
On December 4, 1990 Denault J. dismissed the
appellant's application. He concluded that there was
no res judicata: as the Superior Court judgment con
tained no specific ruling on the argument involving
the infringement of an unregistered trade mark, For
get J.'s comments in this regard were only obiter
dicta; further, as the appellant's bottle at issue in the
Federal Court proceeding was not the same as the one
at issue in the Superior Court, there was no identity
of cause and so no possibility of res judicata. In these
circumstances, the Federal Court had jurisdiction by
reason "of the interpretation given by the Federal
Court of Appeal to section 7 of the Trade-marks Act
in Asbjorn Horgard A/S v. Gibbs/Nortac Industries
Ltd. 2 and sections 20(2) of the Federal Court Act and
55 of the Trade-marks Act".
It is this order which is the subject of the appeal at
bar.
Obiter dictum or ratio decidendi?
[TRANSLATION] Dictum what is said
obiter by the way, incidentally
An opinion given by a judge which is not required to sup
port the decision he is making.
Obiter dictum is to be contrasted with ratio decidendi.
RATIO (or RATIONES) DECIDENDI
The reason (or reasons) for deciding
The essential reason for a judgment, the basis of the deci
sion, is the ratio decidendi; a proposition which is not essential
to the decision in the case, on the other hand, is an obiter dic
tum... . 3
[TRANSLATION] Res judicata applies only to points argued by
the parties, which are decided by the judgment and which must
be decided for the case to be settled ... It does not apply to
mere assertions which were not the subject of argument ...
Opinions given by the judge on points simply mentioned by
him which were not in issue do not have the authority of res
judicata. In those cases there is what is ordinarily referred to as
an obiter dictum, that is, in Jéraute's (Vocabulaire français-
anglais et anglais français de termes et locutions juridiques,
Paris, Libr. gen. de dr., 1953, p. 319) definition, an "opinion
expressed by the way on a point of law which does not have
the force of precedent" . 4
2 [1987] 3 F.C. 544.
3 A. Mayrand, Dictionnaire de maximes et locutions latines
utilisées en droit, Cowansville, Yvon Blais, 1985, at pp. 193
and 239.
4 A. Nadeau and L. Ducharme, Traité de droit civil du Qué-
bec, vol. IX, Montréal, Wilson et Lafleur, 1965, at p. 467,
para. 568.
[TRANSLATION] I have already expressed the view that neither
of two alternative reasons given in support of a decision should
be regarded as obiter dictum since each is part of the ratio
decidendi (Nadeau c. Nadeau, [1977] C.A. 248, 265). I have
not subsequently changed my view, especially as I was relying
on a passage from the opinion of Lord Simon speaking for the
House of Lords in Jacob v. London County Council, [1950]
A.C. 361, at 368, which shows how preposterous the contrary
opinion would be. 5
In the case at bar the respondent had sought two
orders for an injunction from the Quebec Superior
Court, one against the offence of passing off and the
other against the use of unregistered distinguishing
guises. In practice it was a two-step procedure, which
could just as readily have been dealt with in two sep
arate actions that would probably have been joined
for purposes of hearing. Both steps were argued by
the parties, the Superior Court was asked to rule on
each one and did in fact rule on each, in the terms I
have indicated above.
It is undoubtedly true, as counsel for the respon
dent maintained, that the disposition of the judgment
referred only to the step that the Court accepted (the
passing-off offence) and passed over in silence the
step rejected by the Court (the absence of an infringe
ment of an unregistered mark). However, the time is
past, if indeed it ever existed, when the language of a
disposition is minutely scrutinized regardless of the
underlying reasons and the relief sought in the action,
and everything not echoed in the conclusion was nec
essarily regarded as an obiter dictum.
Even the text by Professor Jean-Claude Royer to
which the respondent referred the Court suggests an
approach that I would describe as "case-by-case": 6
[TRANSLATION] 776—General observations—In principle res
judicata applies only to the disposition of the judgment. In
some cases, it extends to the reasons.
777—The disposition—The disposition is the formal decision
that settles a case. It is usually contained in the conclusions of
a judgment.
778—The reasons—The disposition sometimes contains an
implied decision which has the authority of res judicata. [My
emphasis.]
5 Roland Jacques Inc. c. Laboratoire Dr. Renaud Inc.,
[1980] C.A. 553 (Que), at p. 555, per Bélanger J.A.
6 J.-C. Royer, La preuve civile, Cowansville, Yvon Blais,
1987, at p. 286.
I think it is Professor Léo Ducharme who best sum
marizes the relative flexibility of the ratio decidendi
concept, when he says that: 7
[TRANSLATION] What the judgment implicitly decides has the
authority of res judicata (Vachon c. Frenette-Vachon, [1978]
C.A. 515; Droit de la famille -75, J.E. 83-883 (S.C.)) just as
does what is expressly stated in it.
Forget J. said that in his opinion, on analysing the
evidence and considering the applicable law, the
respondent [TRANSLATION] "did not succeed in estab
lishing that an unregistered trade mark" had been
infringed. In so doing, he decided one of the two
points argued by the parties which he had to decide to
resolve the case, since one of the orders sought dealt
specifically with that point. It would undoubtedly
have been better if in the conclusion he had made it
clear that the action was allowed only in part or, if he
had dismissed the part of the action concerning the
unregistered trade mark, but it is readily understanda
ble that as he disposed of one part of the action in
such clear language he did not think it necessary, as
in any case he was allowing the other remedy
claimed, to discuss it expressly in the conclusion.
What has been clearly and expressly decided in the
reasons does not become a mere obiter dictum just
because nothing is said about it in the conclusion. It
is a matter of perspective and overall assessment. To
adopt the words of Gonthier J. in Rocois Construc
tion Inc. v. Québec Ready Mix Inc., 8
When the question is whether there is res judicata, the Court in
question has at its disposal a judgment the language and scope
of which it can assess, and this allows it to determine just how
far the authority of res judicata should be attributed to it.
It hardly needs to be added that the case at bar is
not one in which a court mentions several reasons for
deciding a matter when only one of those reasons
would have sufficed (and even in such a case, as
Bélanger J.A. noted in Roland Jacques Inc., 9 such
reasons would have been rationes decidendi), but a
case in which a court decides two matters which are
7 L. Ducharme, Précis de la preuve, 3rd ed., Montréal, Wil-
son & Lafleur, 1986, at p. III. See Ellard v. Millar, [1930]
S.C.R. 319, at p. 326, per Rinfret J.; Vachon c. Frenette-
Vachon, [1978] C.A. 515 (Qué.), at p. 516, per Jacques J.A.
S [1990] 2 S.C.R. 440, at p. 465.
9 Supra, note 5.
before it and the reasons given in support of each of
the two "decisions" are very definitely rationes
decidendi.
Authority of res judicata
Res judicata implies identity of parties, of subject-
matter and of cause. Happily I need not undertake an
analysis of this concept as the Supreme Court of
Canada has made an exhaustive study of it in two
recent cases. 10
In its submission the respondent admitted [TRANS-
LATION] "that its action for a permanent injunction
brought in the Federal Court Trial Division involves
the same parties and that its subject-matter, as
defined by our writers, namely 'the right one seeks to
establish,' is identical". Accordingly, it only remains
to decide whether there is also identity of cause.
"Cause" was defined by Gonthier J. in Rocois 11 as
"the essence of the legal characterization of the facts
alleged". In Robe rge L'Heureux-Dubé J. adopted this
definition, 12 though she said she preferred what she
called the "concrete" or "special concept" of cause as
compared with an "abstract or general concept", as
the first seems "more rational" and the second may
"be confused with the object".
In the case at bar, the respondent argued, the cause
in the action brought in the Federal Court is distinct
from that found in the action brought in the Superior
Court for three reasons: the second action was
brought as a result of the marketing by the appellant
of a new and different wine bottle; this is a new fact
which is the basis of the dispute between the parties;
the area of protection provided by even unregistered
trade marks is a dynamic concept and even if the
respondent's bottle is the same in both actions the
distinctiveness of the bottle has continued to increase
since the action giving rise to the Superior Court
judgment was brought and the Federal Court will
Rocois Construction Inc. v. Quebec Ready Mix Inc.,
supra, note 8 and Roberge v. Bolduc, [1991] 1 S.C.R. 374, at
pp. 401-418, per L'Heureux-Dubé J.
11 Supra, note 8, at p. 456.
12 Supra, note 10, at pp. 418 and 425.
have to decide this aspect of the matter on different
evidence.
These arguments seem attractive and counsel for
the respondent defended them with remarkable
energy and skill. However, I do not think I can accept
them.
Though it concerns a different bottle, the action in
the Federal Court is directed for all practical purposes
at the same objectives as that in the Superior Court.
The respondent frankly admitted this in its submis
sion when it said that the action brought in the Fed
eral Court is one for [TRANSLATION] "passing off as
much as for infringement of unregistered trade marks
and the two remedies must be distinguished".
Like the Superior Court before it, therefore, the
Federal Court has a two-part action to consider, and
the conclusions sought in either action, though
couched in somewhat different language, are for all
practical purposes the same. It is clear beyond any
question that there is no res judicata as to the passing
off, since the bottle in dispute in this part of the
action is that of the appellant, this bottle is different
and the facts giving rise to the allegation of passing
off are not the same. The respondent's first two alle
gations are valid in so far as they concern passing off,
but they have nothing to do with the second part of
the action, that of the infringement of an unregistered
trade mark, which is independent and which concerns
not the appellant's new bottle but the respondent's
bottle, which has remained the same.
However, the respondent suggested in its third
allegation, this second part of the action does not
really concern the same bottle as the one which was
at issue in the Superior Court, as the recognition of
an unregistered trade mark depends on use and the
use of this bottle is now more a source of distinction
than it was two years ago.
This argument is valid in principle and in a partic
ular case might certainly be an obstacle to the appli
cation of res judicata. The new use and new distinc-
tiveness would still in my opinion have to be alleged
in the second action, and most importantly, the first
judgment would have to have concluded not that
there could not be an unregistered trade mark but that
there was not yet an unregistered trade mark.
In the case at bar the second action alleges nothing
new except that it updates the sales figures. These
figures may in general have an effect on the use of a
mark, but the Superior Court did not take this into
account and in the instant case they are not an indica
tion of new use or new distinctiveness. Additionally,
Forget J.'s judgment is clear [at page 564]: the reason
the respondent had not [TRANSLATION] "established a
distinctive guise allowing it to claim exclusive rights
to the opaque Hock type white bottle with a blue
label" was that "the Hock (Alsace) type bottle is in
common use" and moreover, under "the theory of
exhaustion of colours" the respondent could not
monopolize white. Whether two years or ten years
have passed, whether sales have doubled or increased
tenfold, does not in any way alter the legal finding
made by Forget J.: there is not and in the circum
stances there cannot be an unregistered trade mark.
The case at bar bears some resemblance to Canadian
Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada,i"
in which the Supreme Court of Canada held that a
judgment rendered by the Judicial Committee of the
Privy Council four years before on a trade mark
which the Committee refused to recognize had the
force of res judicata in the circumstances since it was
not possible to present any evidence of a different use
of the mark in question.
In my opinion, it would be to distort the very prin
ciple of res judicata to make it applicable only to
what was decided by a judgment as a whole, when
that judgment disposed concurrently of several
claims made to it which were separate from each
other. As L'Heureux-Dubé J. observed in Roberge, 14
The rationale for this irrebuttable legal presumption of valid
ity of judgments is anchored in public social policy to ensure
13 [1939] S.C.R. 329.
14 Supra, note 10, at p. 402.
the security and stability of relations in society. The converse
would be anarchy, with the possibility of endless trials and
contradictory judgments.
She referred in particular to this passage from Planiol
and Ripert in their Traité pratique de droit civil fran-
çais: 15
It is a social necessity of the first order that legal proceedings
should not be started over and over again on the same matter.
Res judicata applies once the question has been
decided, and it does not matter whether it was
decided alone or with other questions. As Nadeau and
Ducharme observed, 16 [TRANSLATION] "this rule (of
res judicata) also does not mean that in a given case
there can only be one final judgment". At a time
when the tendency is to avoid multiple actions and to
join similar causes of action in the same proceeding,
it would not be in the interests of this "social neces
sity" to allow a party who failed on one point to
begin over on that point solely because several
actions were combined in the same proceeding. At
the risk of simplification I would say that res judicata
applies when in a new proceeding a party seeks, per
haps in other language, to obtain from the same
opponent the same thing (or one of the things) which
it was denied in an earlier action.
I therefore conclude that in the case at bar the
"cause", namely "the essence of the legal characteri
zation of the facts alleged", is to all intents and pur
poses the same in both proceedings: the respondent's
white opaque bottle, which constitutes the material
fact on which the right claimed is directly and imme
diately based, is the same in both actions. 17. Accord
ingly, there is identity of parties, of subject-matter
and of cause and res judicata applies.
15 2nd ed., vol. VII, 1954, No. 1552, at p. 1015.
16 Supra, note 4, at p. 456, No. 560.
17 In the Federal Court, the respondent no longer insisted on
the distinguishing guise allegedly provided by the presentation
of its bottle and did not mention in the conclusions it sought
the colour of that presentation. This difference does not seem
significant to me in deciding whether there was res judicata: as
the Superior Court judgment ruled on both the distinguishing
guises mentioned by the respondent, the latter clearly could not
avoid the effect of res judicata by limiting itself to one of those
guises in a new action. As Mignault pointed out, Le droit civil
(Continued on next page)
Federal Court jurisdiction
Under section 55 of the Trade-Marks Act, 18
55. The Federal Court has jurisdiction to entertain any action
or proceeding for the enforcement of any of the provisions of
this Act or of any right or remedy conferred or defined
thereby.
Under subsection 20(2) of the Federal Court Act, 19
the Federal Court has concurrent jurisdiction in cases
in which a remedy is sought under the authority of
any federal Act or at law or in equity respecting any
patent of invention, copyright, trade mark or indus
trial design.
The appellant argued that once the respondent is
no longer able, on account of res judicata, to main
tain that its distinctive guises constitute an unregis
tered trade mark, the Federal Court has no jurisdic
tion to consider the only remaining part of the action
brought, namely the offence of passing off. This
argument is valid.
The Federal Court, which is a creature of statute,
has no jurisdiction apart from what is expressly con
ferred on it by Parliament, and that jurisdiction can
only be given to it in respect of an existing body of
federal law which is essential to the disposition of the
case. 20
In the case at bar the legislation on which the
respondent relies is paragraphs (b), (c) and (e) of sec
tion 7 of the Trade-marks Act, which reads as fol
lows:
7. No person shall
(Continued from previous page)
canadien, Montréal, 1902, vol. VI, at p. 105, [TRANSLATION] "to
complete the rule it must be said that there is no need for the
two actions to claim exactly the same result, but there will be
res judicata when the subject-matter of the second action is by
implication contained in the subject-matter of the first".
18 R.S.C., 1985, c. T-13.
19 R.S.C., 1985, c. F-7.
20 See ITO—International Terminal Operators Ltd. v. Miida
Electronics Inc. et al., [1986] I S.C.R. 752, at p. 766; Kigowa
v. Canada, [1990] 1 F.C. 804 (C.A.); Southam Inc. v. Canada
(Attorney General), [1990] 3 F.C. 465 (C.A.).
(a) make a false or misleading statement tending to discredit
the business, wares or services ofa competitor;
(b) direct public attention to his wares, services or business
in such a way as to cause or be likely to cause confusion in
Canada, at the time he commenced so to direct attention to
them, between his wares, services or business and the wares,
services or business of another;
(c) pass off other wares or services as and for those ordered
or requested;
(d) make use, in association with wares or services, of any
description that is false in a material respect and likely to
mislead the public as to
(i) the character, quality, quantity or composition,
(ii) the geographical origin, or
(iii) the mode of the manufacture, production or perform
ance
of the wares or services; or
(e) do any other act or adopt any other business practice
contrary to honest industrial or commercial usage in
Canada.
In MacDonald et al. v. Vapor Canada Ltd., 21 the
Supreme Court of Canada came to the conclusion
that paragraph 7(e) was unconstitutional and
appeared to raise a question as to the validity of the
other paragraphs. In Asbjorn Horgard A/S v. Gibbs
/Nortac Industries Ltd., 22 this Court considered that
the observations of Laskin C.J. in MacDonald did not
necessarily lead to the conclusion that the other
paragraphs of section 7 were unconstitutional, and
MacGuigan J.A., speaking for the Court, expressed
the opinion that paragraphs (a) to (d) were "constitu-
tionally valid in so far as they merely round out the
trade mark scheme of the Act, because this is not an
expansion of the federal jurisdiction but merely a
completion of an otherwise incomplete circle of juris
diction".
Referring in particular to paragraph 7(b), MacGui-
gan J.A. added the following at pages 560 and 561:
None of this, not even the civil remedy (in any event, analo
gous to that upheld in the Attorney General of Canada v. Qué-
bec Ready Mix Inc. case, supra) is controversial. What is at
issue is Parliament's right to create a civil remedy in relation to
a trade mark not registered under the Act.
21 [1977] 2 S.C.R. 134, at p. 172.
22 Supra, note 2, at p. 556.
Paragraph 7(b) is a statutory statement of the common law
action of passing off, which consisted of a misrepresentation to
the effect that one's goods or services are someone else's, or
sponsored by or associated with that other person. It is effec
tively a "piggybacking" by misrepresentation.
At common law the right to a trade mark thus arose through
the use of a mark by a business to identify its products to the
public. There was no need for the business to register its mark
in order to protect its right to use the trade mark and prevent
the misuse of its trade mark by other businesses. The passing
off action was the enforcement mechanism available for the
protection of trade mark rights. Without the passing off action,
common law trade mark rights would have little value.
The Canadian Act, as the statutory history set out by Laskin
C.J.C. in the MacDonald case, supra, showed, has traditionally
been concerned with the protection of unregistered as well as
registered trade marks. In this it is like the Copyright Act
[R.S.C. 1970, c. C-30], whose coverage is broader than regis
tered copyright. In both Acts what registration does is to pro
vide additional benefits over and above those available at com
mon law.
In paragraph 7(b) Parliament has chosen to protect the good
will associated with trade marks. In this way, as Chief Justice
Laskin put it, it "rounds out" the statutory scheme of protection
of all trade marks. As such, the civil remedy which it provides
in conjunction with section 53 is "genuinely and bona fide
integral with the overall plan of supervision": Attorney Gen
eral of Canada v. Québec Ready Mix Inc., supra, at pages 79
F.C.; 226 N.R.; 172 C.P.R. It has, in sum, a rational functional
connection to the kind of trade marks scheme Parliament
envisaged, in which even unregistered marks would be pro
tected from harmful misrepresentations.
In my view, paragraph 7(b) is clearly within federal consti
tutional jurisdiction under subsection 91(2) of the Constitution
Act, 1867.
It seems to me to follow from these reasons that
paragraph 7(b) is valid in so far as the passing off
action is connected to a trade mark, registered or not,
but that it would not be valid in a case such as the one
at bar in which the passing off action, as a result of
the fact that the absence of an unregistered trade
mark is res judicata, is not connected to any trade
mark. In my opinion, the same reasoning applies to
paragraph (c). 23
23 See Promotions Atlantiques Inc. v. Hardcraft Industries
Ltd. (1987), 13 C.I.P.R. 194 (F.C.T.D.), at pp. 198-199, per
Strayer J.
As the relief sought by the appellant cannot be
based on section 7 of the Trade-marks Act, this Court
can have no jurisdiction. 24
I would therefore allow the appeal, declare that the
Federal Court has no jurisdiction to hear the action
filed in the Registry of the Court on October 11, 1990
and dismiss the said action with costs to the appellant
at trial and on appeal.
MARCEAU J.A.: I concur.
DESJARDINS J.A.: I concur.
24 See Québec Ready Mix Inc. v..Rocois Construction Inc.,
[19891 1 S.C.R. 695.
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.