03 March 2012

Appeals Court Finds Nadine Potatoes Protected Under PBR Act

Appeal Decision: Elders Rural Services Australia Limited v Registrar of Plant Breeder's Rights [2012] FCAFC 14 (29 February 2012)
Appeal from: Elders Rural Services Australia Limited v Registrar of Plant Breeder's Rights [2011] FCA 384
See also: Federal Court Finds Fatal Flaw in PBR Act

Nadine potatoesA Full Bench of the Federal Court of Australia has overturned the April 2011 decision of a single judge of the court, who found that a drafting flaw in the transitional provisions of the Plant Breeder’s Rights Act 1994 left the Nadine potato without protection under the PBR Act.

In 1994, the PBR Act replaced the earlier Plant Variety Rights Act 1987.  The PVR Act differed from the PBR Act in a number of respects, notably in that it typically provided a shorter term of protection by measuring the 20-year period from the date of acceptance rather than the later date of grant of rights.  Additionally, a PBR provides a broader scope of protection, giving exclusive rights in relation to propagating material of the variety, whereas a PVR protected only the plants and their reproductive material (i.e. seeds).  The PBR Act also includes provisions whereby protection may be extended to a range of derived and related varieties.

The application to protect the Nadine potato straddled the two Acts, being originally filed and accepted under the PVR Act, but not being granted until after the PBR Act came into force.  At that time the PVR Act had been repealed, and therefore could not be the basis for a grant of rights.  As the appeals court has succinctly put the issue (at [40]), ‘either the [applicant] acquired PBR under the new Act by reason of the grant that occurred on 16 August 1995 or it acquired no right at all.’

The primary judge had looked at the transitional provisions of the PBR Act, and determined that on a literal reading none of them applied to an application which spanned the changeover period in the manner of the Nadine potato case, and concluded that the applicant had thus acquired no enforceable rights.  Furthermore, he concluded that the apparent drafting error in the PBR Act was not one ‘which can be redrawn by the Court. The unfortunate result which the drafting error discloses is a matter for Parliament.’

Elders Rural Services Australia Limited (‘Elders’) appealed the decision.

OUTCOME ON APPEAL

The Full Bench of the Federal Court showed none of the primary judge’s squeamishness about reading a suitable ‘correction’ into the legislation.

The Full Court essentially concluded that the purpose of the transitional provisions of the PBR Act was to ensure that third parties would not be adversely affected by the broadening of rights granted as compared with the PVR Act.  An existing granted PVR was thus converted to a PBR, subject to the limitations that it would retain its existing expiry date, and that it would not provide the additional exclusive rights and extensions available to grants made under the new Act.

Any rights not yet granted under the PVR Act, and thus not yet enforceable, could not trigger such concerns.  While a grant under the PVR Act was, once granted, retrospectively enforceable from the date of acceptance, the Full Court noted the applicant had never gained this right under the old Act (at [50]-[51]).

Furthermore, the Full Court did not feel that any judicial redrafting of the PBR Act was necessary to achieve the correct outcome (at [58]):

We do not think the present case is one that calls for the application of such an approach because we do not think it is necessary to add words, omit words or substitute words to the new Act in order to give effect to Parliament’s intention. As we have explained, we consider it implicit in s 83 of the new Act that any grant made in connection with an application to which it applies will be a grant made under the new Act.

The court therefore concluded that the Nadine potato is protected by a grant of full rights under the PBR Act, including a 20 year term commencing from the date of grant, and thus terminating on 16 August 2015.

COMMENT

Whatever the relative strengths and weaknesses of the reasoning of the appeals court, the primary judge’s conclusion that it would be up to Parliament to correct an apparent drafting error in the PBR Act wrought, in our view, a fairly substantial injustice.

The fact is that rights – such as those relating to the Nadine potato – potentially affected by the transitional provisions will all have expired within the next three to four years.  There is absolutely no realistic prospect that the Parliament would turn its attention to the correction of such a subtle technical flaw in a relatively low-profile piece of legislation during this period.

In practice, therefore, by abrogating responsibility to the legislature the primary judge was effectively sealing the fate of all such ‘transitional’ rights to be null and void.

Far better, therefore, that the court make the only available alternative finding, which in this case is that the Nadine potato enjoys the full protections of grant under the PBR Act.  If the Parliament does not like this outcome (although it is hard to see any convincing objections), then it remains free to legislate away the court’s decision.

But, as stated above, there is no realistic prospect of that happening.

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