Iron Creek Group Inc v Registrar of Corporations (Alberta), 2021 ABQB 872

Court of Queen’s Bench of Alberta Citation: Iron Creek Group Inc v Registrar of Corporations (Alberta), 2021 ABQB 872 Date: 20211105 Docket: 2001 12125 Registry: Calgary Between: Iron Creek Group Inc. Appellant - and - Registrar of Corporations (Alberta) and Ironcreek Oilfield Rentals Inc. Respondents _______________________________________________________ Reasons for Decision of the Honourable Madam Justice M.H.

Hollins _______________________________________________________ [ 1 ] This is an appeal from the decisions of the Registrar of Corporations for the Province of Alberta (the “Registrar) holding that the name Iron Creek Thermal Remediation Inc. (proposed by Iron Creek Group Inc) is too similar to IronCreek Oilfield Rentals Inc. to be granted registration under that name. [ 2 ] IronCreek Oilfield Rentals Inc (“IC Rentals”) is an oilfield services company registered in Alberta since 2011 and doing business primarily in western Canada .

Its business includes renting equipment but also providing drilling management services and environmental containment and reporting. Iron Creek Group Inc (“IC Group”) is an Alberta company registered in 2015, also doing business primarily in western Canada. It provides oilfield services including the remediation of soil.

[ 3 ] On April 4, 2018, IC Rentals obtained a direction from the Registrar that IC Group would have to change its name as it was too similar to IC Rentals, based in part on the fact that IC Group’s name did not contain any words which were descriptive of its services. [ 4 ] IC Group then applied for approval of the name Iron Creek Thermal Remediation Inc (“IC Remediation”) but the Registrar also rejected that proposal by decision dated August 26, 2020. The Registrar was of the opinion that Iron Creek Thermal Remediation Inc was still too similar to IronCreek Oilfield Rentals Inc.

IC Group appeals both of these decisions. [ 5 ] The appeals are dismissed for the reasons that follow. The Legal Requirements [ 6 ] Under

Section 12 of the Alberta Business Corporations Act (ABCA), a company cannot register under a name that is confusing or misleading; s.12(c)(

i) ABCA. If it does so, the Registrar can direct the company to change its name; s.13 ABCA. [ 7 ] The Regulation to the ABCA clarifies that a name will be confusing or misleading if it is too similar to the name of an already-registered Alberta company; s.4(1) Regulation 118/2000. What is too similar?

The Regulation defines this as a name that would reasonably lead to the inference that the companies are associated or affiliated OR a name that would lead an interested person to believe that he or she is dealing with one company when it is actually the other; s.4(4) Regulation 118/2000. [ 8 ] In making that determination, the Registrar may have regard to the following factors from s.15 of the Regulation regarding the contested or proposed name: (

a) The distinctiveness of the name or any element of the name and the extent to which it has become known; (

b) The length of time the name has been used; (

c) The nature of the business carried on under the name; (

d) The nature of the trade or industry with which the name is associated, including the nature of the goods or services and how they are provided or sold; (

e) The degree of similarity in appearance or sound; (

f) The geographic area in which the name is likely to be used. The Registrar’s Decisions [ 9 ] In 2018, the Registrar was comparing Ironcreek Oilfield Rentals Inc to Iron Creek Group Inc. She summarized their arguments and made her findings on each of the above factors from s.15 of the Regulation . She found: (

a) That “iron” and “creek” were not distinctive; (

b) That IC Rentals had been using the name about 4 years longer than IC Group; (

c) That their business lines and geographic scope had overlap; (

d) That both companies provided some drill management services and thermal remediation; (

e) That the names were “phonetically identical”; and (

f) That the companies worked in close proximity to each other. [ 10 ] Under s.15(c), the Registrar referred back to s.4.4 of the Regulation and said that, because IC Group’s name did not include any words describing its services, a new customer or supplier could confuse the two companies or assume they were affiliated.

She also reviewed a number of Alberta cases which she said focussed on the use of words within the corporate names that “were indicative of the fields of endeavour or industry in which the corporations were involved”. [ 11 ] She concluded that the similarity in the names could reasonably lead someone to deal with one company believing it to be the other and thus directed IC Group to change its name. [ 12 ] IC Group did so, swapping out “Group” for “Thermal Remediation” effective May 15, 2018.

IC Rentals again complained to the Registrar and by her decision dated August 26, 2020, she (different individual than in 2018) again found the names too similar. [ 13 ] The 2020 decision essentially repeated the 2018 analysis with an additional

section dealing with the use of “thermal remediation” in IC Group’s new name. Among other things, the Registrar said that the phonetic similarity of the shortened versions of the names along with the overlap in their provision of thermal remediation services still meant that a person could be misled as to the true identity of either corporation. [ 14 ] IC Group appeals both the initial and the second decision of the Registrar under s.247 of the Business Corporations A ct (the “ABCA”). It frames the issues as follows: 1. Did the Registrar err in finding that “IronCreek” is a coined term? 2.

Did the Registrar err by failing to consider the sophistication of the customers and prospective customers of both companies?

3. Did the Registrar err in its choice of legal test for determining similarity? 4. Did the Registrar err in determining that the names were sufficiently similar to deny IC Group’s application to register? 5. Did the Registrar err in determining that customers and prospective customers of IC Oilfield would likely be deceived by anysimilarity between the names?

Standard of Review [15] The parties agree that the standard of review on this judicial review is correctness on questions of law and palpable andoverriding error on findings of fact, including inferences, or questions of mixed fact and law; Canada (Minister of Citizenship andImmigration) v Vavilov, 2019 SCC 65 at paras 17, 36-37. [16] IC Group concedes that issues number 1, 4 and 5 are questions of mixed fact and law and subject to review only for palpableand overriding error.

However, it says that issues number 2 and 3 are extricable questions of law and subject to review for correctness.The Registrar and IC Rentals says that the appeals are effectively from the Registrar’s factual determination that the corporate nameswere confusingly similar and thus the only standard of review is palpable and overriding error. [17] In my view, even as presented by IC Group as the appellant, the only question above that is subject to review for correctnessis number 3, namely whether or not the Registrar employed the correct legal test for determining similarity.

The other grounds of appealare all, as framed and in substance, questions of fact or mixed fact and law as they merely contest the Registrar’s conclusions. Thoseconclusions are entitled to deference and will only be reversed if there is palpable and overriding error present in the Registrar’s reasons.

Choice of Test (Ground #3) [18] Because the choice of legal test is the only ground of appeal subject to a review for correctness, I will begin there. [19] IC Group argues that the Registrar relied too heavily on the case of Bumper’s, The Beef House (Banff) Ltd v Alberta(Registrar of Companies), (AB KB), 9 AR 349 (QB). They say that Bumper’s should be confined to its facts. Idisagree. [20] In Bumper’s, the Registrar had refused to force Bumpers Discotheque to change its name at the request of Bumpers BeefHouse.

Laycraft, J (as he then was) allowed the appeal from Bumpers Beef House and ordered Bumpers Discotheque to change its name.He explained that, according to the Court of Appeal decision in Action Plumbing Ltd v Action Alberta (Registrar of Companies), 1976CarswellAlta 140 (QB), he was bound to consider the constitution of the group of people using or looking to use these services, as wellas whether the similar or identical words were descriptive of the respective businesses; paras.10-12.

He made the point that, whileconfusion might be avoided if people used the full corporate names of the parties, if they instead used the shortened form of those names(i.e. “Bumpers”), confusion could arise; para.13. [21] IC Group also says that a later decision of McFayden, J (as she then was) in Twin City Equipment Sales & Rental Ltd v TwinCity Excavating Ltd, 1980 CarswellAlta 504 (QB), rejected the reasoning in Bumper’s. Again, I disagree.

In fact, she articulated the testin a way that reflects the current state of the law: I do not understand that either the decision of Morrow, JA in Action Plumbing or Laycraft, J in Bumper’s as stating that the mere use ofone or more identical words is sufficient to require the registrar to change the name.

The issue is whether the similarity of names wouldbe likely to deceive having regard to the name; the businesses actually carried on by the companies; the objects of the companies asdisclosed in the memoranda of association and having regard to the customers served by the companies and whether these customers canbe said to be knowledgeable and less likely to be deceived by any similarity; para.19 [22] Some cases have focussed on certain elements more than others (for example, on the class of users; Re CC Chemicals Ltd, (ON CA), 1967 CarswellOnt 37 (CA) at paras. 37 and 47 or on the overlap, or lack thereof, of services provided; TwinCity at para.22).

However, all have had the same north star, namely whether or not the names are so similar that they are likely to causeconfusion for customers and prospective customers. This is not surprising, given that the test is rather comprehensively laid out in thelegislation. [23] The Registrar’s decisions were both expressly mindful of the legislative test. Her reference to Bumper’s - which jurisprudencehas, in any event, been incorporated rather than rejected by subsequent cases - was not incorrect and affords no maintainable appeal onthat ground.

Coined Term (Ground #1) [24] I will now return to the other grounds for appeal, beginning with whether or not the Registrar erred in finding that Iron Creekwas a coined term. [25] This is important only in that coined terms i.e. newly-minted or invented words, may be worthy of greater protection,presumably because they are unique or more unusual than language already in wide use.

The IC Group argues that the Registrar wronglytreated “Iron Creek” as a coined term, thereby affording it greater protection than it should legally have. [26] This ground of appeal fails because there is no evidence that the Registrar found as a fact that “Iron Creek” is a coined term,much less overly relied on such a fact. She said only that she was unable to find any other instances of the use of “Iron Creek” in acorporate name in Alberta. Just because no one has used a word or combination of words in a previous corporate name does not mean thefirst person to do so is coining a term.

That is not an escapable inference of what she said, nor does a reasonable reading afford thatinterpretation.

[ 27 ] There is no overriding and palpable error on the part of the Registrar on this ground. Sophistication of Customers (Ground #2) [ 28 ] IC Group framed this as an error of the Registrar in failing to consider the relative sophistication of prospective customers at all, and thus an error of law.

I agree with IC Rentals that she considered but rejected IC Group’s argument that confusion was unlikely because the group of prospective customers are expected to be quite knowledgeable about service providers in the oil and gas industry. [ 29 ] In 2018, IC Group’s written submissions referred expressly to these consumers as “large, sophisticated operations”, whose employees would be highly unlikely to be confused by any similarity between the names.

The 2019 submissions of IC Group repeated this argument, saying that consumers of the services of the two companies would be unlikely to believe they were in the same business, particularly given the addition of “Thermal Remediation” in the 2019 proposed name. [ 30 ] Although neither Registrar addressed the sophistication of potential customers or suppliers specifically using that phrase, both clearly understood and discussed that the customers of both companies were oil and gas industry participants. [ 31 ] As recognized by the appellant, the Registrars were not required to specifically address every argument in their respective written decisions.

Further, it is my view that even knowledgeable or seasoned employees might very well use the shortened versions of these names. As discussed below, there is no phonetic difference between “Iron Creek” and “Ironcreek”.

Given the overlap in the services provided by these companies within the same industry, there is no palpable or overriding error in the decision of the Registrars that any relative sophistication of these potential customers could not overcome those problems. [ 32 ] Even if I were wrong in characterizing this ground of appeal as one of mixed fact and law, I believe the ultimate decision of the Registrars was correct for the reasons stated. Degree of Similarity (Ground #4) [ 33 ] This ground of appeal is largely a catch-all for the appellant’s arguments on other grounds.

IC Group argues that the 2020 decision did not adequately consider the relevant factors under s.15 of the Regulation, notwithstanding that the format of the 2020 decision is identical to the 2018 decision and addressed each factor in turn and separately. [ 34 ] IC Group argues that the 2020 Registrar’s analysis was patently flawed because she found that customers and suppliers of IC Rentals might accidentally contact IC Group based on the fact that they are both oil and gas service companies and the shortened versions of their names sound identical. [ 35 ] However, beyond raising the sophistication of the customer base again (dealt with above), IC Group is simply rejecting the Registrar’s decision, saying she has not provided reasons for finding the names too similar when she clearly did.

Likelihood of Confusion (Ground #5) [ 36 ] Even as described by the appellant, this ground of appeal is an aggregate of the foregoing grounds of appeal, which it says led to a palpably erroneous conclusion that someone could reasonably be led to deal with IC Group thinking they were dealing with IC Rentals. [ 37 ] In Re CC Chemicals , the Ontario Court of Appeal considered the objection of Construction Chemicals Limited to the registration of the name CC Chemicals Ltd by another. Both companies sold chemicals for concrete and masonry to construction industry participants.

The Court of Appeal began with the test under [then] s.12 of the Corporations Act (Ontario) which precluded registration under a name “likely to deceive”; para.8. [ 38 ] The Court found that “CC Chemical” and “Construction Chemical”, compared side by side, were not so similar as to likely deceive, particularly given the industry knowledge of the likely respective customers of both companies; paras.45-46. [ 39 ] It is true that here, notwithstanding somewhat similar facts, the Registrars applied these tests and came to a different conclusion regarding the likelihood of confusion.

One difference between Re CC Chemical and the case at bar is the auditory similarity between “Iron Creek” and “Ironcreek”, which of course are phonetically identical. This was a consideration, even in Re CC Chemicals ; para. 39 [ 40 ] In Action Plumbing , our Alberta Court of Appeal overturned Laycraft, J’s decision that “Action Plumbing Ltd.” was sufficiently different from “Action Auger Drain Cleaning Co”.

Having reviewed In Re CC Chemicals , Morrow, JA writing for the majority, concluded that the use of the word “Action” combined with the overlap in the business of the two companies would be likely to deceive; para. 49. [ 41 ] As in many areas of law, the degree of discretion at play is significant because of the inherently subjective nature of the legislative test. Accordingly - and predictably - the jurisprudence is full of cases using the same test and coming to different conclusions.

In both decisions, the Registrar had multiple grounds on which to conclude that the names were similar enough to likely cause confusion about which company was which or whether they were affiliated. There is no palpable or overriding error in the reasoning or the conclusion. Conclusion [ 42 ] Here, the test for me is not whether I would have made the same decision but whether there is palpable and overriding error in the reasoning or result of the Registrars. There is not. The Registrars both set out the applicable factors, considered the relevant case law and analyzed each facet of the competing arguments.

[ 43 ] I also refer here to the decision of my sister, Grosse, J in Reliance OFS Canada Ltd v Registrar of Corporations and Reliance Production Optimization Ltd , 2020 ABQB 600 at para.44 where she makes the point that even if the Registrar was palpably incorrect in the analysis of one of multiple factors, it would have to be an error that changed the result. In the whole, there is no such error in the decision of the Registrars to refuse to register Iron Creek Thermal Remediation Inc. [ 44 ] The appeal is dismissed. Parties may speak to costs if necessary. Heard on the 13 th day of April, 2021.

Dated at the City of Calgary, Alberta this 5 th day of November, 2021. M.H. Hollins J.C.Q.B.A. Appearances: Russell Patterson for the Appellant, Iron Creek Group Inc. Katrina Edgerton-McGhan for the Respondent, Ironcreek Oilfield Rentals Inc. Christine Nugent for Registrar of Corporations