The Supreme Court of Canada upholds summary judgment and dismisses a copyright class action for Teranet
September 26, 2019
On September 26, 2019 the Supreme Court of Canada (SCC) issued its decision in Keatley Surveying Ltd. v. Teranet Inc., 2019 SCC 43, upholding summary judgment and dismissing a copyright class action in favour of Teranet. The claim was initiated in 2010 by Keatley Surveying Ltd. on behalf of all land surveyors in Ontario. The claim alleged that Teranet was infringing surveyors’ copyright in plans of survey that were registered and deposited in Ontario’s land registry system.
Teranet operates Ontario’s on-line electronic land registry system (ELRS) on behalf of the Province of Ontario. In 1991 Teranet and the Ontario government entered into a public-private partnership to undertake the automation and conversion of the paper-based land registry system to an electronic land title system. This public-private partnership was supported by duly enacted legislation and valid licensing agreements, and continued under the detailed statutory scheme governing the registration and deposit of all documents relating to title of land, including plans of survey. Since the on-line conversion, the ELRS has become integral to real property management and transactions in Ontario.
One of the key common issues that was certified in the class action was whether the copyright in surveys belongs to the Province of Ontario by virtue of the operation of section 12 of the Copyright Act which provides that Copyright vests in the Crown in respect of works prepared or published “under the direction or control” of the Crown or any governmental department. Section 12 has never before been substantively analysed in the Canadian context, and comparative statutes and law from other jurisdictions did not definitively answer the question of when Crown copyright is operative under the Canadian Copyright Act.
At first instance on summary judgment, Justice Belobaba held that the registration and deposit of plans of survey into the Ontario land registry system engages s. 12 and results in copyright vesting in the Province. The Ontario Court of Appeal unanimously agreed. In a decision written by Justice Doherty, the Court confirmed that copyright in registered and deposited plans of survey vests in the Crown, and that Teranet was authorized to make copies of plans available to the public, as a service provider to the Province. Justice Doherty held, “The extensive property-related rights in the registered or deposited plans of survey bestowed on the Crown by the provincial legislative scheme must be considered as a whole”, and acts to meet the threshold of the requisite “direction and control” contemplated by section 12 of the federal Copyright Act. Further, the system within which Teranet operated as a service provider to Ontario is part of an integral and required public service.
The Court of Appeal decision in Keatley Surveying Ltd. v. Teranet Inc., 2017 ONCA 748 confirmed the importance and validity of public-private partnerships, and how these relationships must be understood as part of, and integrated with, the government’s statutory and regulatory responsibilities. The Court of Appeal’s definitive and unanimous decision also confirmed the reliability and priority of the provincial electronic land registry system, without interference from other interests, for businesses engaged in real property transactions. The representative plaintiff sought and was granted leave by the SCC.
The SCC in a unanimous decision dismissed the plaintiff’s appeal with two sets of concurring reasons, each of which confirmed the public importance of land registration documents and Teranet’s role as a service-provider for the Province. Justice Abella, writing the Majority’s reasons, applied an interpretive framework for determining when s. 12 is engaged and when a work is “prepared or published by or under the direction or control of the Crown”. These factors include the presence of a statutory scheme that transfers property rights, places controls on the content of the work, whether the Crown physically possesses the work, and whether the published works must be available to the public. Justices Brown and Coté writing the Minority reasons took a different approach and determined that for s. 12 to be engaged, the work had to be “a government work”. Both the Majority and Minority agreed, however, that their respective analyses applied to plans of survey, such that copyright vested in the Crown.
Until today, s.12 had not been comprehensively reviewed by a Canadian court since its enactment in 1921 and the decision will have broad implications and application.
McCarthy Tétrault LLP represented Teranet throughout certification and through to summary judgment at the Supreme Court of Canada, with a team co-led by Julie Parla and Barry Sookman, that consisted of Hovsep Afarian, Stephanie Sugar, Simon Cameron, and F. Paul Morrison