2015 QCCA 747, 2015 QCCA 747

Unofficial English Translation Québec (Procureure générale) c. Magasins Best Buy ltée 2015 QCCA 747 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-024419-145 (500-17-074083-125) MINUTES OF HEARING DATE: April 27, 2015 CORAM: THE HONOURABLE FRANÇOIS PELLETIER , J.A. YVES-MARIE MORISSETTE , J.A. JULIE DUTIL, J.A. MARIE-FRANCE BICH, J.A. NICHOLAS KASIRER, J.A. APPELLANT COUNSEL ATTORNEY GENERAL OF QUEBEC Mtre Benoit Belleau Mtre Eric Cantin (Direction générale des aff. jur. et légis). RESPONDENTS COUNSEL

BEST BUY STORES LTD. COSTCO WHOLESALE CANADA LTD. GAP (CANADA) INC. OLD NAVY (CANADA) INC. WALMART CANADA CORP. TOYS ‘R’ US CANADA LTD. CURVES INTERNATIONAL INC. Mtre CHRISTINE A. CARRON Mtre GREGORY BRIAN BORDAN ( Norton Rose Fulbright Canada LLP. ) GUESS? CANADA CORPORATION MTRE STÉPHANE CARON ( Gowling Lafleur Henderson LLP .) INTERVENERS COUNSEL RETAIL COUNCIL OF CANADA INTERNATIONAL TRADEMARK ASSOCIATION Mtre CHRISTINE A.

CARRON Mtre GREGORY BRIAN BORDAN ( Norton Rose Fulbright Canada LLP. ) Mtre FRANÇOIS GUAY ( Smart & Biggar) Appeal from a judgment rendered on April 9, 2014, by the Honourable Michel Yergeau of the Superior Court, District of Montreal. NATURE OF APPEAL : Trade-marks – Language of public signs and posters

Court clerk: Linda Côté Courtroom: Louis-H.-Lafontaine HEARING 9:30 a.m. Start of the hearing: The presiding judge addresses counsel for the appellant. Mtre Benoît Belleau is authorized to file submissions. 9:31 a.m. Mtre Belleau's arguments. 11:00 a.m. Recess. 11:21 a.m. Resumption. Mtre Belleau continues his arguments. 11:35 a.m. Mtre Éric Cantin's arguments. 12:04 p.m. Recess. 2:00 p.m. Resumption. 2:01 p.m. The Court informs counsel for the respondents and the interveners that it does not need to hear them. Unanimous ruling by the Court – the reasons will be filed subsequently. 2:02 p.m. End of hearing.

Court clerk PER CURIAM: JUDGMENT FOR THE REASONS THAT SHALL BE FILED SUBSEQUENTLY, THE COURT: [ 1 ] DISMISSES the appeal, with costs. FRANÇOIS PELLETIER, J.A. YVES-MARIE MORISSETTE, J.A. JULIE DUTIL, J.A.

MARIE-FRANCE BICH, J.A. NICHOLAS KASIRER, J.A. Québec (Procureure générale) c. Magasins Best Buy ltée 2015 QCCA 747 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-024419-145 (500-17-074083-125) DATE: May 1, 2015 CORAM: THE HONOURABLE FRANÇOIS PELLETIER, J.A. YVES-MARIE MORISSETTE, J.A. JULIE DUTIL, J.A. MARIE-FRANCE BICH, J.A. NICHOLAS KASIRER, J.A. ATTORNEY GENERAL OF QUEBEC APPELLANT – defendant v. MAGASINS BEST BUY STORES LTD. COSTCO WHOLESALE CANADA LTD. GAP (CANADA) INC. OLD NAVY (CANADA) INC. WALMART CANADA CORP TOYS ‘R’ US CANADA LTD. CURVES INTERNATIONAL INC. GUESS?

CANADA CORPORATION RESPONDENTS – plaintiffs and RETAIL COUNCIL OF CANADA INTERNATIONAL TRADEMARK ASSOCIATION INTERVENERS - interveners REASONS FOR JUDGMENT DELIVERED FROM THE BENCH April 27, 2015 [1] On April 27, 2015, the Court rendered the following judgment from the bench: FOR THE REASONS THAT SHALL BE FILED SUBSEQUENTLY, THE COURT:

DISMISSES the appeal, with costs. [ 2 ] Here are the reasons for that judgment. * * [ 3 ] The respondents post their trade-marks on the storefronts of the establishments they operate in Quebec. These trade-marks include English-language words ("Guess", "Curves"), combinations of such ("Best Buy", "Old Navy" or "Banana Republic"), portmanteaus ("ConnectPro", "Walmart"), and other distinctive elements that are not linguistic (signs, for example) or that are connected to a particular graphic representation (colour, calligraphy, spatial layout, etc.).

What these trade-marks (or the storefront panels on which they appear) do not include is French-language generic or specific terms. [ 4 ] Are the respondents thereby violating the Charter of the French Language (the " Charter ")? [1] More specifically, must the respondents add a French-language generic term to the trade-marks they put on their signage to comply with the Charter ? [ 5 ] The Attorney General of Quebec answers these questions in the affirmative, arguing forcefully that the way the respondents do things violates the Charter and the Regulation respecting the language of commerce and business [2] (the " Regulation "), and

section 27 of the Regulation in particular. [ 6 ] The trial judge did not accept this point of view and the Court is essentially in agreement. * * [ 7 ] For reasons that are known and are no longer disputable, promoting and protecting the French language is, in Quebec, an established priority responding to a real and persistent need. The use of French in public is one of the pivotal points of this policy: " [P]ublic signs and posters and commercial advertising shall be solely in the French language" or in a manner which ensures the marked predominance of the French, states

section 58 of the Charter , which sets out a principle that ensures that the reality of Quebec society is reflected in its " visage linguistique" . [3] [ 8 ] That said, if the Charter prescribes the use of French, it does so in the spirit of justice and openness acknowledged in its own

preamble and, moreover, in compliance with the limits imposed by the Constitution, specifically with regard to the division of powers and freedom of expression. Sections 58 and 63 to 68 of the Charter , whose validity is not at issue here (no more than that of the regulatory provisions under their umbrella), were adopted in response to these constraints. And, as we will now see, the respondents have complied with these provisions. [ 9 ] Certainly, some might wish the respondents to modify their practices [4] and post differently, [5] but that does not mean that they are compelled or, indeed, obliged to do so by the current drafting of the Charter and the Regulation . * * [ 10 ]

Section 58 of the Charter states: [6] 58. L'affichage public et la publicité commerciale doivent se faire en français . Ils peuvent également être faits à la fois en français et dans une autre langue pourvu que le français y figure de façon nettement prédominante . 58. Public signs and posters and commercial advertising must be in French . They may also be both in French and in another language provided that French is markedly predominant .

Toutefois, le gouvernement peut déterminer , par règlement, les lieux, les cas, les conditions ou les circonstances où l'affichage public et la publicité commerciale doivent se faire uniquement en français ou peuvent se faire sans prédominance du français ou uniquement dans une autre langue .

However, the Government may determine , by regulation, the places, cases, conditions or circumstance s where public signs and posters and commercial advertising must be in French only, where French need not be predominant or where such signs, posters and advertising may be in another language only . [Emphasis added.] [ 11 ] As a general rule, public posting – i.e., public posting in all its forms, broadening quite a bit the concept of "signs" in the expression "signs and posters" in the English version of

section 58 – must therefore be in French, or if another language is used, it must be used in such a manner as to make the French markedly predominant. However – and the adverb signals an exception to the general rule – the government may determine, in such cases and under the conditions provided by regulation, that such posting may occur in another language only.

The provision states the exception just as clearly as the general rule: the legislature tells us that, in certain circumstances, it is indeed permitted to post (that is, to publicly announce by posting a sign) “only” in a language other than French (i.e., to the exclusion of French). [ 12 ] What are these circumstances? [ 13 ] They are stated in

section 25 of the Regulation :

25. Dans l'affichage public et la publicité commerciale, peuvent être rédigés uniquement dans une autre langue que le français : 1° le nom d'une entreprise établie exclusivement hors du Québec; 25.

On public signs and posters and in commercial advertising, the following may appear exclusively in a language other than French : (1) the firm name of a firm established exclusively outside Québec; 2° une appellation d'origine, la dénomination d'un produit exotique ou d'une spécialité étrangère, une devise héraldique ou toute autre devise non commerciale; (2) a name of origin, the denomination of an exotic product or foreign specialty, a heraldic motto or any other non-commercial motto; 3° un toponyme désignant un lieu situé hors du Québec ou un toponyme dans cette autre langue officialisé par la Commission de toponymie du Québec, un patronyme, un prénom ou un nom de personnage, de même qu'un nom distinctif à caractère culturel; (3) a place name designating a place situated outside Québec or a place name in such other language as officialized by the Commission de toponymie du Québec, a family name, a given name or the name of a personality or character or a distinctive name of a cultural nature; and 4° une marque de commerce reconnue au sens de la Loi sur les marques de commerce (L.R.C. 1985, c.

T-13), sauf si une version française en a été déposée. (4) a recognized trade mark within the meaning of the Trade Marks Act ( R.S.C. 1985, c. T-13 ), unless a French version has been registered. [Emphasis added.] [ 14 ] Therefore, according to the fourth paragraph of the preceding regulatory provision, it is possible to publicly post a trade-mark that does not include a French-language unit or free morpheme if a French version has not been registered.

On this last point, we note that the provision does not compel the entity with several trade-marks at its disposal, one of which may be in French or have a French version, to use a French one rather than the others. It is also noteworthy that

section 25 does not specify or limit the type of public posting covered and therefore contemplates all types of posting, including signs hung on storefronts. [ 15 ] It would therefore be natural to conclude that the respondents, who post their respective trade-marks (which do not have registered French versions) in this way, are compliant with the Regulation and, therefore, with the Charter . [ 16 ] The Attorney General, however argues that subsection 25(4) of the Regulation is in fact more restrictive than it appears, insofar as it must be read together with

section 27 of the same regulation. To properly understand this assertion, she explains, sections 63 and 67 of the Charter must first be taken into account. Under those provisions, the name of an enterprise (that is, its corporate name and the name under which it does business, identifies itself or is known, within the meaning of articles 305 and 306 C .C.Q. or the Act Respecting the Legal Publicity of Enterprises [7] ) must be in French, in whole (as per

section 63) or in part (as per

section 67). In the second case, under conditions established by regulation, the establishment of a name including a specific term (that is, a distinctive term) taken from a language other than French is indeed allowed. [8] The conditions in question are those set out under

section 27 of the Regulation , which requires that any such specific term must be accompanied by a French-language generic term. These are the provisions in question: Charter of the French Language 63. Le nom d'une entreprise doit être en langue française. 63. The name of an enterprise must be in French. 67. Peuvent figurer, comme spécifiques, dans le nom d'une entreprise , conformément aux autres lois ou aux règlements du gouvernement, les patronymes et les toponymes, les expressions formées de la combinaison artificielle de lettres, de syllabes ou de chiffres ou les expressions tirées d'autres langues . 67.

Family names, place names, expressions formed by the artificial combination of letters, syllables or figures, and expressions taken from other languages may appear in the names of enterprises to specify them, in accordance with the other Acts and with the regulations of the Government. Regulation respecting the language of commerce and business 27. Peut figurer comme spécifique dans un nom, une expression tirée d'une autre langue que le français, à la condition qu'elle soit accompagnée d'un générique en langue française. 27.

An expression taken from a language other than French may appear in a firm name to specify it provided that the expression is used with a generic term in the French language. [Emphasis added.] [ 17 ] The Attorney General further argues that in this case the respondents are using their trade-marks as they would a name, to identify themselves to their customers. [9] In this context, they are necessarily subject to the rules governing names and, consequently, their respective marks (which serve a specific function) must be used with a French-language generic term, in compliance with sections 67 of the Charter and 27 of the Regulation .

The respondents cannot claim to be free of this obligation by arguing subsection 25(4) of the Regulation . That provision protects no more than a trade-mark in a language other than French. The addition of a French-language

generic term, as required under

section 27, would not compromise this right in any way, since the integrity of the mark is not affected by the obligation of adding a French-language generic term above, under, or next to it. [ 18 ] The Attorney General therefore concludes that when used publicly as a name, as the respondents have done here, a trade-mark in a language other than French may be posted but only when accompanied by a French-language generic term.

In other words, under sections 25(4) and 27 of the Regulation , when a trade-mark is posted as a business name or has the same purpose as a business name and is in a language other than French, it may be publicly posted only if appears with a French-language generic term. [ 19 ] With respect, this argument is unconvincing. [ 20 ] Admittedly, the Charter , like any statute, must be given a broad and generous

interpretation to ensure that its objectives are achieved and this in a manner that takes into account its wording and context. The same is true with regards to the Regulation , with appropriate modifications. It is also true that the principles set out in the Charter and outlined in the Regulation , like any other principles, are not neutralized by the exceptions they contain. Such exceptions must receive a strict

interpretation, especially since some embody a principle or strike a balance sought by the legislature. The fact remains that exceptions, like principles, must have meaning and cannot be denied in the name of the principles (any more than the reverse). [ 21 ] The Attorney General's assertion, however, is not consistent with section 58(3) of the Charter , which, completed by section 25(4) of the Regulation , is partly neutralized by the reading she suggests. Nor is this assertion consistent with

section 68 of the Charter , which she completely ignores. [ 22 ] We reiterate that the first two paragraphs of

section 58 state the principle that public posting must be in French or give French a position that is markedly predominant. The manner or the purpose of the posting is not otherwise specified, so we must understand that any public posting is contemplated, irrespective of format or function, including the name or names of an enterprise. As for the third paragraph, it states the exception to the principle of French or predominant French in plain language: under the conditions and in those cases determined by regulation, public posting may be “in another language only ”. This exception is implemented under

section 25 of the Regulation , which states that public posting (for any purpose at all, since the provision does not specify) of a trade-mark or other designation [10] “exclusively” in a language other than French is authorized. [ 23 ] Should we, as the Attorney General suggests, apply

section 27 of the Regulation to these provisions by imposing in such cases the addition of a French-language generic term? This question can only be answered in the negative. [ 24 ] Section 58(3) of the Charter and

section 25 of the Regulation cannot simultaneously state that posting exclusively in a language other than French is permitted, but only if it is accompanied by a French-language generic term. If there is a French-language generic term, then obviously the posting is not exclusively in a language other than French. The

interpretation proposed by the Attorney General based on

section 27 of the Regulation renders the use of the word "exclusively" in section 58(3) of the Charter and

section 25 of the Regulation meaningless, whereas this word reflects the very essence of the exception these provisions acknowledge. The argument must therefore fail. [ 25 ] But there is more. [ 26 ] The Attorney General's argument does not take into account

section 68 of the Charter : 68. Le nom de l'entreprise peut être assorti d'une version dans une autre langue que le français pourvu que, dans son utilisation, le nom de langue française figure de façon au moins aussi évidente. Toutefois, dans l'affichage public et la publicité commerciale, l'utilisation d'un nom dans une autre langue que le français est permise dans la mesure où cette autre langue peut, en application de l'article 58 et des règlements édictés en vertu de cet article, être utilisée dans cet affichage ou cette publicité.

En outre, dans les textes ou documents rédigés uniquement dans une autre langue que le français, un nom peut apparaître uniquement dans l'autre langue. 68. The name of an enterprise may be accompanied with a version in a language other than French provided that, when it is used, the French version of the name appears at least as prominently. However, in public signs and posters and commercial advertising, the use of a version of a name in a language other than French is permitted to the extent that the other language may be used in such signs and posters or in such advertising pursuant to

section 58 and the regulations enacted under that section. I n addition, in texts or documents drafted only in a language other than French, a name may appear in the other language only. [Emphasis added.] [ 27 ] This provision is unequivocal. Its first paragraph authorizes an enterprise to take a name in a language other than French provided that, when it is used, the French name "appears at least as prominently". However – and once again, the use of this adverb signals an exception – when that use is for public signs and posters, the second paragraph permits the use of a name in a language other than French, pursuant to

section 58 of the Charter and the regulations enacted thereunder, in this case,

section 25 of the Regulation .

[ 28 ] As we know, section 25(4) of this regulation permits the posting of a trade-mark exclusively in a language other than French and, obviously, without the addition of a French-language generic term. It is apparent that a trade-mark that does not include French may be posted as is, even when used as a name or in the manner of a business name, without adding a French-language generic term. To apply

section 67 of the Charter and

section 27 of the Regulation to this case would render the exception under the second paragraph of

section 68 of the Charter meaningless. [ 29 ] There is nothing in the Charter (or any other statute) that allows for any other conclusion, which is in fact consistent with the settled

interpretation that the Office québécois de la langue française has used for over 15 years. On this last point, the Attorney General points out that an administrative

interpretation contrary to the wording of the statute would not prevent its true meaning from being reasserted. That is true, but as Professor Côté has pointed out in an excerpt cited by the trial judge: [11] "A settled

interpretation, if consistent with the text of the enactment, should not be overruled without good reason". [12] That is precisely the case here: the interpretive conduct of the Office and the government in this case has long been consistent with the statute, and there has only recently been a shift, one that is not in step with the statutes and regulations. * * [ 30 ] In short, whether the question is approached merely from the point of view of

section 58 or through a combined reading of sections 63, 67, and 68 of the Charter , the outcome is the same: the respondents are entitled to post their trade-marks as is on their storefronts, even if they do not include any French. [ 31 ] In the first case, they are entitled to post because of the exception under the third paragraph of

section 58 of the Charter , which enables the government to derogate from the principle of posting in French (or ensuring that French is predominant). It is the government that enacted this derogation, set out in four parts under

section 25 of the Regulation . The fourth part permits the public posting of a trade- mark exclusively in a language other than French (when it does not have a French version). [ 32 ] In the second case, that is, where the trade-mark is also used as a name, whether the actual corporate name [13] or another name,

section 68 creates an exception to sections 63 and 67 of the Charter by permitting an enterprise to use a name in a language other than French that cannot usually be used alone except in public posting under

section 58. This referral leads us back to the four scenarios listed under

section 25 of the Regulation , which include trade-marks only in a language other than French (and without a French version), which may therefore be posted as is. * * [ 33 ] In sum, like the trial judge, the Court finds that the posting practices at issue comply with the Charter and the Regulation , which permit the public posting of a trade-mark that does not include any French (and has no French version), including when that trade- mark is posted on a storefront. * * [ 34 ] For these reasons, the Court has dismissed the Attorney General of Québec's appeal. FRANÇOIS PELLETIER, J.A. YVES-MARIE MORISSETTE, J.A.

JULIE DUTIL, J.A. MARIE-FRANCE BICH, J.A. NICHOLAS KASIRER, J.A. Mtre Benoît Belleau Mtre Éric Cantin DIRECTION GÉNÉRALE DES AFF. JUR. ET LÉGIS. For the appellant Mtre Christine A. Carron Mtre Gregory Brian Bordan NORTON ROSE FULBRIGHT CANADA For the respondents and the intervener Retail Council of Canada Mtre Stéphane Caron GOWLING, LAFLEUR, HENDERSON, s.e.n.c.r.l. For the respondent Guess? Canada Corporation Mtre François Guay

SMART & BIGGAR For the intervener International Trademark Association Date of hearing: April 27, 2015