This decision of Hughes J is the first interpretation of the grace period provided for by Rule s 3.1(1) when a “clear but unsuccessful” attempt is made to pay a fee. Hughes J’s decision was a fairly straightforward application of s 12 of the Interpretation Act, which requires that an enactment be given an interpretation “as best ensures the attainment of its objects.”
On September 4 and 15, 2008, the Applicants filed patent applications under the PCT in Sweden and the US. The crucial dates for late entry into the Canadian national phase under Rule s 58(3) (42 months, rather than 30 months), were therefore 4 and 15 March 2012. The letter requesting national phase entry was filed electronically 29 Feb 2012. However, due to a clerical error in office of the Canadian agent, the total fee was sufficient to cover only the basic fee (10(a)) and the second year maintenance fee (30(a)(i)), and not the late payment fee (11); the total tendered was $250, when it should have been $450. CIPO consequently refused entry into the national phase, on the basis that s 58(3) requires payment of fees prior to the expiry of 42 months from the priority date.
The decision concerned the application of Rule s 3.1(1) which provides for a grace period
if, before the expiry of a time limit for paying a fee set out in Schedule II, the Commissioner receives a communication in accordance with which a clear but unsuccessful attempt is made to pay the fee.
In such a case, the Commissioner is required to (“shall”) send a notice requesting payment of the deficiency: s 3.1(2). The Commissioner did not do so.
CIPO argued that it was not “clear” that the Applicant intended to pay the late payment fee. Hughes J’s description of CIPO’s argument was very brief: “Counsel relies on the words ‘the fee’ in Rule 3.1” .
Treating the interpretation of s 3.1(1) as a matter of first instance , Hughes J appealed to s 12 of the Interpretation Act , and held, in effect, that “the fee” should be interpreted to mean the fee that was payable for the thing that the applicant was clearly trying to do . Thus Rule 3.1 was applicable, and the Commissioner’s decision not to apply the grace period was unreasonable.
It seems to me that Hughes J’s decision was straightforwardly correct. I find it very difficult to think of an interpretation that would support CIPO’s position. Perhaps CIPO was of the view that there must be a clear attempt to pay the full fee, and the provision is only operable if the attempt is unsuccessful for technical reasons? I don’t see any reason why the requirement of a subjective intent to pay the full fee should be read into this Rule. In any event, I am just speculating as to what CIPO’s position might have been. I wonder if what happened is that someone at CIPO simply forgot about Rule 3.1(2), and so sent out a refusal instead of a request for payment, and this litigation was an attempt to justify that error post hoc?
Thanks to Alan Macek's IPPractice for making this decision available before it has been posted on the Federal Court website.