Re Board of Control of Michigan Technological University v Deputy Commissioner of Patents [1981] FCA 39; (1981) 53 FLR 26 (16 April 1981)

FEDERAL COURT OF AUSTRALIA

Re: BOARD OF CONTROL OF MICHIGAN TECHNOLOGICAL UNIVERSITY
And: DEPUTY COMMISSIONER OF PATENTS [1981] FCA 39; (1981) 53 FLR 26
No. VG 159 of 1980
Patents - Appeal Against Decision of Tribunal - Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIAN DISTRICT REGISTRY
GENERAL DIVISION
Bowen C.J.(1), Franki(2) and Deane(1) JJ.

CATCHWORDS

Patents - Patent application - Lapse - Applications for extension of time and for restoration - Extension granted - Restoration refused on grounds of "Undue delay".

Appeal Against Decision of Tribunal - Exercise of original jurisdiction - Question of law.

Patents Act 1952, s.160(2), reg. 7B

Administrative Appeals Tribunal Act 1975, s.44.

Patents - Application - Lapse - Application for extension of time and restoration - Extension granted but restoration refused - Undue delay - Delay be agents attributable to applicant.

Administrative Law - Administrative Appeals Tribunal - Appeal against Tribunal's decision - Whether question of law - Patents Act 1952 (Cth), s. 160 - Patents Regulations, reg. 7B - Administrative Appeals Tribunal Act 1975 (Cth), s. 44. The appellant was the applicant for a patent. The application lapsed by reason of the failure of the applicant's attorney to comply with a requirement of the Deputy Commissioner of Patents. The applicant applied to the Deputy Commissioner for an extension of time to comply with the requirement and for restoration of the lapsed application. That relief was refused on the ground that the Deputy Commissioner lacked jurisdiction and the applicant appealed to the Administrative Appeals Tribunal.

The Tribunal held that the Deputy Commissioner had jurisdiction to grant the relief sought, and it allowed the application for extension of time to comply with the requirement. However, the Tribunal refused the application for restoration of the application.

The applicant appealed to the Federal Court.

Held: (1) The appeal to the Federal Court is an exercise of that court's original jurisdiction.

(2) The question whether there had been such undue delay as would prevent the restoration of the application was a question of statutory construction, and so a question of law.

(3) The default of an applicant's agent or attorney is a relevant fact in determining whether a delay is an undue delay, for the purpose of an extension of time to comply with a requirement.

(4) The Tribunal had not made errors of law in deciding whether there had been undue delay within reg. 7B(8)(c) of the Patents Regulations in applying for restoration by taking into account: (a) that the period of delay stretched from the date when the fact that the application for a patent had lapsed was advertised in the Official Journal; (b) so much of the period of delay as could be attributed to the negligence and default of the Australian firm of patent-attorneys.

Per Franki J. - Undue delay in applying for the restoration of a lapsed application for a patent may adversely affect members of the public in ways which cannot be ascertained. That public prejudice has to be weighed against the hardship to the applicant whose agent's default caused the application to lapse.

R.H. Searby Q.C. and R. Macaw, for the appellant.

J. Emmerson, for the respondent.

HEARING

Sydney, 1981, March 11-12; April 16. 16:4:1981

Solicitors for the appellant: Arthur Robinson & Co.

Solicitor for the respondent: Deputy Crown Solicitor.

J.W.K. BURNSIDE

ORDER

1. The appeal be dismissed.

2. The appellant pay to the respondent his costs of the appeal. Appeal dismissed.

DECISION

On 14 April, 1975, the Board of Control of Michigan Technological University ("the Board") applied to the Commissioner of Patents for a patent for an invention entitled "Method of Agglomerating Steel Plant Waste Dust". The application was accompanied by a complete specification. On 8 May, 1975, the Commissioner gave a direction requiring the re-typing of certain pages of the specification. This direction was not complied with. The consequence of non-compliance was that the application for a patent lapsed on 8 November, 1975.

On 11 March, 1976, the Commissioner advertised in the Official Journal the fact that the application for a patent had lapsed. Under the Patent Regulations (Reg. 7B(6)), the appellant was entitled, within three months after the date of that advertisement, to apply to the Commissioner for restoration of the lapsed application. It did not make any such application within that period. Some two years later, on 7 March, 1978, the Board applied to the Commissioner, pursuant to s.160(2) of the Patents Act, 1952 ("the Act"), for an extension of time for lodging an application for restoration of the lapsed application for a patent. At the same time, an application for restoration, accompanied by a substitute specification complying with the Commissioner's direction, was lodged.

The applications for extension of time and for restoration of the lapsed application for patent were dealt with by the Deputy Commissioner. He refused them on the ground that he had no legal power to grant them. The Board applied to the Administrative Appeals Tribunal for a review of those decisions of the Deputy Commissioner. The Tribunal, which was constituted by its learned President (Davies J.), held that the Deputy Commissioner was mistaken in his conclusion that he lacked power to grant the applications. The Tribunal granted the application for an extension of time to the extent necessary to validate the application for restoration which had been lodged. The Tribunal then refused the application for restoration on the ground that it was not satisfied that there had been no undue delay in the making of the application for restoration and, that being the case, it was precluded by the provisions of Regulation 7B(8)(c) from restoring the lapsed application. The Board appeals to this Court from the Tribunal's decision refusing restoration of the lapsed application for a patent.

The "appeal" to this Court lies pursuant to the provisions of s.44 of the Administrative Appeals Tribunal Act, 1975. It lies within the original jurisdiction of the Court and is expressly restricted to a question of law. At the commencement of the appeal, counsel for the respondent Deputy Commissioner submitted that the appeal was incompetent for the reason that it did not involve any question of law. What was involved, it was argued, was the question whether there had been, in the circumstances of the case, "undue delay in the making of the application for restoration" within the ordinary meaning of those words. That question, so it was said, was solely a question of fact. In this regard, reliance was placed on the judgment of Mason J., with whom the other members of the High Court agreed, in Hope v. Bathurst City Council [1980] HCA 16; (1980) 29 A.L.R. 577.

It can be said at once that we do not accept the submission that the appeal does not involve a question of law. In our view, the appeal raises two substantive questions involving the correct connotation and denotation of the words "undue delay in the making of the application for restoration" as determined in the context of, and by reference to, both the general scheme of the Act and Regulations and the particular provisions of Regulation 7B.Q Those questions are questions of statutory construction. They are questions of law (see Hope v. Bathurst City Council, supra, at p. 584). Before proceeding to the identification and consideration of them, it is desirable to refer in somewhat more detail to the relevant facts.

The failure of the Board to comply with the Commissioner's direction and the long delay in taking steps aimed at procuring the restoration by the Commissioner of the lapsed application was the result of negligence and default in the office of the Australian firm of patent attorneys retained to act on the Board's behalf. It would seem that the Board had entrusted the matter to its United States patent attorneys who had engaged the services of the Australian firm. The failure to comply with the Commissioner's direction and the fact that the application for a patent had consequently lapsed was not known to the Board or its United States patent attorneys until November, 1977, when different Australian patent attorneys were engaged on the Board's behalf. In so far as the question of apportionment of the blame for failure to comply with the Commissioner's direction and for subsequent delay in taking steps to seek restoration of the lapsed application may be relevant, the Tribunal found that the blame fairly lay at the door of the original Australian firm of patent attorneys and that no blame could be attributed to the Board, its United States patent attorneys or the Australian patent attorneys who were subsequently retained.

Section 160(2) of the Act provides:

"Where, by reason of --

(a) an error or omission on the part of the person concerned or of his agent or attorney; or

(b) circumstances beyond the control of the person concerned,

an act or step in relation to an application for a patent or in proceedings under this Act (not being proceedings in a court) required to be done or taken within a certain time has not been so done or taken, the Commissioner may, upon application by the person concerned, but subject to this section, extend the time for doing the act or taking the step".

In his reasons for setting aside the Deputy Commissioner's decision refusing to grant, pursuant to s.160(2) of the Act, an extension of time for the making of an application for restoration, the learned President expressed the view that no element of public interest other than that arising out of undue delay suggested itself. His Honour referred to the provisions of sub-paragraph 8(c) of Regulation 7B which preclude restoration of a lapsed application unless the Commissioner (or the Tribunal on a review) is satisfied that there has been no undue delay in making the application for restoration and effectively put to one side the question of whether the delay in making the application for an extension of time was such as to lead to the conclusion that an extension of time should not be granted. His Honour said:

". . . a consideration of reg. 7B shows that the public interest is, in this case, sufficiently protected by sub-reg. (8) for that sub-regulation precludes the restoration of an application for a patent in a case where there has been undue delay. The grant of an extension of time will not adversely affect the public interest for it will not enable the restoration of the lapsed patent application if there has been such delay.
..................................................
I am therefore of the view that time should be extended to the extent necessary to validate the application for restoration of patent application no. 80103/75 made by written application dated 3 March, 1978".

As at present advised, we entertain considerable doubt as to whether the Tribunal was entitled, in deciding whether an extension of time should be granted pursuant to s.160(2), effectively to disregard the long delay that had occurred in making the application for an extension. The delay in making the application for an extension would, prima facie, appear to be an important factor to be taken into account in determining whether the application should be granted and an extension of time allowed. It appears to us to be at least arguable that the fact that, if an extension of time were allowed, the delay would be a relevant factor in determining whether the application should be restored does not cancel or lessen the importance of the delay as a factor to be taken into account in determining whether an extension of time should be allowed. The Deputy Commissioner has not, however, sought to challenge the Tribunal's decision granting an extension of time and we have not had the benefit of hearing argument on this point. That being the case, we refrain from reaching any concluded view on it.

The process of reasoning which led the Tribunal to grant an extension of time for making an application for restoration is not, however, irrelevant to the actual issues involved in the appeal. It was argued, on behalf of the Board, that there was implicit in the Tribunal's granting of an extension of time a finding that there had been no undue delay in the making of the application for an extension of time. This finding was claimed to be essentially inconsistent with the Tribunal's subsequent finding of undue delay in the making of the application for restoration. Examination of the Tribunal's reasons for decision makes it clear that no such finding was implicit in its decision to extend time. As has been indicated, the Tribunal in effect disregarded the Board's delay in making the application for an extension of time on the basis that, if there were undue delay, the application for restoration would, in any event, be refused.

The Commissioner's direction requiring re-typing of certain pages of the specification was given pursuant to sub-paragraph (3) of Regulation 7B. When the direction was not complied with within six months, the application for a patent lapsed under sub-paragraph (4). Sub-paragraphs (5), (6), (7) and (8) of Regulation 7B read as follows:

"(5) Where an application has lapsed under the last preceding sub-regulation, the Commissioner shall advertise that fact in the Official Journal.

(6) The applicant may, within three months after the date of the advertisement under the last preceding sub-regulation, make an application (in this regulation referred to as "the application for restoration") to the Commissioner for the restoration of the lapsed application.

(7) The application for restoration shall be in accordance with Form 8A and shall contain a statement of the circumstances that led to the failure to comply with the direction within the prescribed time.

(8) If the Commissioner is satisfied that --

(a) the failure to comply with the direction within the prescribed time was unintentional and resulted from an error or omission on the part of the applicant or of his agent or attorney or from circumstances beyond the control of the applicant;

(b) the applicant has complied with the direction; and

(c) there has been no undue delay in the making of the application for restoration,

the Commissioner shall restore the lapsed application, but, if he is not so satisfied, he shall refuse the application for restoration".

Having decided that an extension of time for the lodging of the application for restoration of the lapsed patent should be granted, the Tribunal turned its attention to the question whether it was satisfied of the matters referred to in (a), (b) and (c) of sub-regulation (8) of Regulation 7B. It found that it was satisfied of the matters mentioned in (a) and (b). On the question raised by (c), the Tribunal held that the relevant period of delay was the period from the date of the advertisement of lapse in the Official Journal to the time when the application for restoration was lodged. The Tribunal found that, even though no valid criticism could be directed against either the Board or its United States patent attorneys, the delay in making the application for restoration was undue. In so finding, the Tribunal effectively burdened the Board with the consequences of the negligence and default of the Australian firm of patent attorneys which had been originally retained.

The two specific questions of construction raised by the Board on the appeal are as follows. First, it is argued that the relevant period of delay was the period commencing at the time when an extension of time for making the application for restoration was granted for the reason that that was the first occasion upon which the Board both knew of the need to make the application and was in a position to make it. Second, it is claimed that the Tribunal was in error in taking into account against the Board, on the question of whether there had been undue delay, either the negligence or default of the Australian firm of patent attorneys or the consequence of that negligence or default. We shall consider these attacks on the decision of the Tribunal in the order in which we have mentioned them.

In the ordinary case where no extension of time for making an application for restoration has been granted, the application for restoration will be made within the period of three months from the date on which the fact that the application has lapsed is advertised in the Official Journal. Prima facie, any delay in making the application for restoration is to be measured by reference to the date of that advertisement. Notwithstanding that the application for restoration is made within the period of three months after the date of the advertisement, the delay involved may be undue. Whether or not it is undue will depend on a variety of considerations. Those considerations may arguably include whether the applicant or those acting on its behalf were aware of the advertisement at the time when it appeared. Lack of knowledge may be relevant to the question whether delay is undue. It does not however prevent the period of delay from commencing at the time when the application for restoration could first be made, namely, on the publication of the advertisement in the Official Journal.

The fact that no application for restoration was made within the period of three months after the date of the advertisement neither altered the fact that the period of delay had commenced to run at the time of the advertisement nor brought that period of delay to an end. It is true that after the period of three months had expired and pending the grant of an extension of time, the Board was not entitled to apply for restoration of the lapsed application. That does not, however, alter the plain fact that there was a delay in making the application and that the period of that delay commenced at the time when the application could first have been made and continued to run thereafter until, at the earliest, the application for restoration was lodged.

It follows that we are of the view that the Tribunal was correct in approaching the matter on the basis that the relevant period of delay stretched from 11 March, 1976 when the fact that the application for a patent had lapsed was advertised in the Official Journal.

Nor are we persuaded that the Tribunal was in error in taking into account, in deciding whether it was satisfied that undue delay had not occurred, so much of the period of delay as could be attributed to the negligence and default of the Australian firm of patent attorneys. Regardless of whether the Board has a separate corporate entity from its members, it is apparent that it must, by reason both of its nature and its location, ordinarily act through agents in matters such as lodging and pursuing applications for Australian patents. To hold that delay resulting from the acts or omissions of an agent must be disregarded would, in effect, be to hold that a person or body who or which must, of necessity, act through agents cannot ordinarily be held accountable for undue delay in making an application for restoration pursuant to Regulation 7B.

Prima facie, a person who, by choice or necessity, acts through an agent is burdened with the consequences of the agent's failure to perform the act with the performance of which he has been charged. There are some instances, in the Act and Regulations, of specific provision distinguishing between the error or omission of an agent or attorney on the one hand and the error or omission of the principal on the other. Section 160(2) and Regulation 7B(8)(a) are themselves examples of such provisions. No such provision is, however, applicable to the determination by the Commissioner of whether he is satisfied, as required by Regulation 7B(8)(c), that no undue delay has occurred. In the absence of such specific provision, the ordinary position applies. The facts that the delay was the result of the negligence of an attorney and that a body such as the Board must, in the ordinary course, act through agents and attorneys may not have been irrelevant to the overall assessment of whether the delay was undue. In that assessment however, neither the Commissioner nor, on review, the Tribunal was constrained, as a matter of law, to hold either that the delay which resulted from the negligence and default of the Australian firm of patent attorneys should be disregarded or that, however unreasonable or unnecessary that delay may have been, it did not, in itself or as part of a larger period, constitute undue delay because the fault lay with the agent or the attorney and not with the principal.

In addition to the two specific grounds advanced for impugning the decision of the Tribunal, it was sought to attack the Tribunal's decision on the general ground that, on the material before it, the Tribunal should have been satisfied that there had been no undue delay in the making of the application for restoration. In particular, reliance was placed on the fact that there was nothing in the material before the Tribunal to suggest that any identified person had been prejudiced by the delay in making the application for restoration of the lapsed application.

The Tribunal approached its consideration of the question of whether there had been undue delay on the basis that "undue delay" was "delay which is unreasonable or unnecessary in the circumstances of the case". In the circumstances of this case, that approach was, in our view, correct. It has not been shown that the Tribunal either paid regard to irrelevant factors or failed to pay regard to relevant factors. It does not appear that the Tribunal was under any misapprehension of relevant fact. Nor does it appear that the conclusion which the Tribunal reached on the question whether it was satisfied that there had been no undue delay was not a conclusion which was reasonably open to it on the evidence. In these circumstances, the general attack upon the Tribunal's decision does not raise any question of law upon which an appeal lies to this Court. It is an invitation to the Court to exercise a jurisdiction which it does not possess, namely, to conduct a general review, on the facts, of the Tribunal's decision.

We would dismiss the appeal with costs.

On 14 April 1975 the Board of Control of Michigan Technological University ("the Board") acting by its Australian patent attorney, applied to the Commissioner of Patents ("the Commissioner") for the grant of a patent for an invention entitled "Method of Agglomerating Steel Plant Waste Dust". The application was accompanied by a complete specification which did not comply with the requirements of the regulations ("the Regulations") made under the Patents Act 1952 ("the Act"). Acting under reg. 7B(1) of the Regulations, the Commissioner treated the complete specification as having been lodged at the Patent Office and on 8 May 1975, acting under reg. 7B(3), he directed that a substituted specification complying with the Regulations be lodged. This involved no more than retyping certain pages of the specification in a manner which complied with the Regulations. That direction was not complied with within six months from the date on which it was given and, accordingly, the application for the patent lapsed under the provisions of reg. 7B(4).

Pursuant to the provisions of reg. 7B(5) the Commissioner advertised in the Official Journal on 11 March 1976 that the application had lapsed, and sent a notification to the Board at the address for service noted in its application for the grant of the patent. No application was made within three months after the date of the advertisement to the Commissioner for the restoration of the lapsed patent application under reg.7B(6).

However, by a document dated 3 March 1978 and lodged by the applicant's Australian patent attorney with the Commissioner on 7 March 1978 the applicant applied, ". . . under s.160(2)(a) of the Patents Act 1952-1969, for an extension of time of thirty months from 8 November 1975 to 8 May 1978, within which to apply for restoration of our patent application No. 80103/75 . . . ". On the same day the applicant's Australian patent attorney filed another application with the Commissioner ". . . for the restoration of application No.80103/75, which has lapsed . . . ". On 17 March 1978 a senior clerk in the Patent Office advised the Board's Australian patent attorney that: "The provisions of s.160 are not applicable to the lodgment of an application for restoration under reg.7B(6). As the application for restoration was not lodged within the prescribed time it is not now possible to restore the application".

Ultimately, the respondent, the Deputy Commissioner of Patents ("the Deputy Commissioner") heard both applications at the same time. Counsel appeared for both parties, and, on 3 November 1978 the Deputy Commissioner delivered written reasons for his decision. It is only necessary to say that he concluded by saying ". . . I have no legal power to do so, I am not authorized to grant the applications for an extension of time and for restoration of the lapsed application".

It is convenient at this stage to set out s.160 of the Act which provided:

"(1) . . .

(2) Where, by reason of -
(a) an error or omission on the part of the person concerned or of his agent or attorney; or
(b) circumstances beyond the control of the person concerned,
an act or step in relation to an application for a patent or in proceedings under this Act (not being proceedings in a court) required to be done or taken within a certain time has not been so done or taken, the Commissioner may, upon application by the person concerned, but subject to this section extend the time for doing the act or taking the step.

(3) The time for the doing of an act or the taking of a step may be extended under either of the last two preceding sub-sections although that time has expired.

(4) Where an application is made under sub-section (2) of this section for an extension of time for more than 3 months, the Commissioner shall advertise the application in the Official Journal.

(5) . . .

(6) . . .

(8) . . . "

It is also convenient to set out reg.7B as it appeared prior to the amendments of 28 June 1979 made by S.R. No.93 of 1979:

"(1) Where a complete specification received at the Patent Office does not comply with the requirements referred to in regulation 7, or the requirements of sub-regulation (2) of regulation 13, of these Regulations, the Commissioner may treat the complete specification as not having been lodged at the Patent Office or treat it as having been so lodged.

(2) If under the last preceding sub-regulation the Commissioner treats a complete specification as not having been lodged at the Patent Office, he shall return it, together with any document received in relation to it, to the person from whom it was received, with a statement indicating the matters in respect of which the specification does not comply with the requirements referred to in that sub-regulation.

(3) If under sub-regulation (1) of this regulation the Commissioner treats a complete specification as having been lodged at the Patent Office, he may, within three months after the date on which it was lodged, direct the applicant to do such things as are necessary to ensure that the complete specification complies with the requirements referred to in that sub-regulation.

(4) If an applicant to whom a direction is given under the last preceding sub-regulation in relation to a complete specification fails to comply with the direction within six months after the date on which it was given, the application to which the complete specification relates shall lapse.

(5) Where an application has lapsed under the last preceding sub-regulation, the Commissioner shall advertise that fact in the Official Journal.

(6) The applicant may, within three months after the date of the advertisement under the last preceding sub-regulation, make an application (in this regulation referred to as 'the application for restoration') to the Commissioner for the restoration of the lapsed application.

(7) The application for restoration shall be in accordance with Form 8A and shall contain a statement of the circumstances that led to the failure to comply with the direction within the prescribed time.

(8) If the Commissioner is satisfied that -

(a) the failure to comply with the direction within the prescribed time was unintentional and resulted from an error or omission on the part of the applicant or of his agent or attorney or from circumstances beyond the control of the applicant;

(b) the applicant has complied with the direction; and

(c) there has been no undue delay in the making of the application for restoration,

the Commissioner shall restore the lapsed application, but, if he is not so satisfied, he shall refuse the application for restoration.

(9) . . .

(10) Where a lapsed application has been restored under this regulation, the Commissioner shall advertise that fact in the Official Journal."

An application for a review of the decision refusing the application for an extension of time and the application for restoration of the lapsed application for a patent was lodged with the Administrative Appeals Tribunal ("the Tribunal") on 1 December 1978.

When the proceedings commenced before the Tribunal counsel for the Deputy Commissioner submitted that the Tribunal had no jurisdiction to review the decision of the Deputy Commissioner in the two applications. The Tribunal agreed that it would first consider the jurisdictional issue, and, in the event that it concluded that it did have jurisdiction to review the decision of the Deputy Commissioner it would give directions as to the further hearing of the review.

The Tribunal came to the conclusion that it had jurisdiction to review the decision of the Deputy Commissioner and made certain orders as to advertising.

An appeal was brought to this Court under the provisions of s.44 of the Administrative Appeals Tribunal Act 1975 and it was submitted that the Tribunal had made an error of law in holding that it had jurisdiction to review the decision of the Deputy Commissioner. The Full Court of this Court dismissed the appeal in a judgment which is reported in (1979) 28 A.L.R. 551.

The Tribunal, then constituted by the learned President, considered both the application under s.160(2) for an extension of time to lodge an application for restoration of the patent and the application for the restoration of the patent under reg.7B.

The President granted the application under s.160(2) for an extension of time within which to lodge an application for restoration of the patent but refused to restore the lapsed application.

The applicant has appealed under the provisions of s.44(1) alleging errors of law by the President in refusing the application for restoration of the lapsed patent. No appeal has been lodged by the Deputy Commissioner against the grant of the application for an extension of time in which to lodge the application for restoration of the lapsed application and thus no question arises concerning that issue.

The principle question raised before us concerns the words "undue delay" in reg.7B(8)(c).

It will be seen that this regulation requires the Commissioner to consider whether or not he is satisfied about the matters set out in (a)(b) and (c). If he is so satisfied he is required to restore the lapsed application but, if he is not so satisfied, he is required to refuse the application for restoration.

It is necessary to examine certain further facts in some detail.

The Board is described in the application as ". . . a statutory body created and appointed by the legislature of the State of Michigan, . . . ". The application stated that the Australian patent attorney's office was the address for service on the Board. (See reg. 88).

In addition to advertising the lapse of the application the Commissioner sent a letter dated 9 March 1976 to the Board addressed to the Australian patent attorney, notifying that "the application will be advertised as 'Lapsed, Not open to Public Inspection' in the Official Journal on 11.3.76".

The Board's instructions to its Australian patent attorney were conveyed through an American firm of patent attorneys. On 21 April 1975 the Australian patent attorney advised the American patent attorneys that the complete specification had been lodged on 14 April 1975. After some further correspondence the Australian patent attorney advised the American patent attorney on 11 June 1975 that he would prepare the fresh specification required by the Commissioner. Thereafter the Australian patent attorney failed to lodge the amended specification. It will be seen that on 11 June 1976 the last day for making an application for restoration under reg.7B(6) passed.

On 15 March 1977 the American patent attorneys enquired of the Australian patent attorney about the status of the application and they wrote to the Australian patent attorney about the continuation fee due on 14 April 1977. The Australian patent attorney on 7 April 1977 wrote to the American patent attorneys saying that it had paid the continuation fee. However this fee was not accepted by the Commissioner because the application had lapsed and the Australian patent attorney was so advised by the Commissioner.

In November 1977 the Board engaged different Australian patent attorneys and on 7 March 1978 they made the applications based upon s.160(2) and upon reg.7B respectively. There was thus a period of about two years between the date when the application was advertised as having lapsed and the date when the applications were made in an endeavour to have it restored.

The learned President held that no blame could be attributed to the Board or its American patent attorneys for the lapsing of the application but that the first Australian patent attorney had done nothing to comply with the direction of the Commissioner and that this was inexcusable.

The first matter which the Deputy Commissioner had to decide was whether he was satisfied that the failure to comply with the direction within the prescribed time was unintentional and resulted from an error or omission on the part of the applicant or his agent or attorney or from circumstances beyond the control of the applicant (reg.7B(8)(a)). The President, exercising the powers of the Deputy Commissioner under s.43 of the Administrative Appeals Tribunal Act, reached the conclusion that the failure to comply with the direction was unintentional and that it resulted from circumstances beyond the control of the applicant and from an omission which occurred in the office of its Australian patent attorney. No challenge was made to this finding. It was quite clear that at the time of the hearing the applicant had complied with the direction and the President so found (reg.7B(8)(b)). Again no attack was made upon this finding.

The argument before us involved the meaning of the words "there has been no undue delay in the making of the application for a restoration" which appeared in reg.7B(8)(c).

The Board based its case on the following four arguments:

1. The President erred in holding that the period for consideration in determining whether there had been undue delay was a period which commenced from the publication of the advertisement in the Official Journal that the application had lapsed.

2. The President erred in holding that any delay which was attributable to an agent or attorney of the Board should be taken into account in the consideration of whether or not there had been undue delay.

3. The President ought to have taken into account the hardship to the Board and compared it with any discernible prejudice to other persons and ought to have held that no such prejudice was discernible.

4. In granting an extension of time under s.160(2) the President must have given consideration to whether any delay was undue and that matter should not be considered again in the application under reg.7B(6).

Appeals pursuant to s.44 of the Administrative Appeals Tribunal Act are limited to questions of law and are within the original jurisdiction of this Court. It was submitted by Counsel for the Deputy Commissioner that no question of law was involved in the decision of the Tribunal.

It is necessary to identify the question of law before this court has jurisdiction to determine the appeal. I consider that the arguments of the Board show that questions of law were involved in the determination by the President in deciding whether or not he was satisfied that there had been "no undue delay in the making of the application for restoration".

Deciding whether facts fully found fall within a statutory enactment properly construed is a question of law. Special circumstances apply where, upon examination, words in a statute are found to have been used according to their common understanding. (Hope v. Bathurst City Council [1980] HCA 16; (1980) 29 A.L.R. 577). In applying these concepts it is necessary to have regard to the need for a proper construction of the statute. The words "undue delay" have to be construed in the light of the context in which they appear.

I consider that this appeal raises a question of law because it is necessary to decide what are the correct answers to the four arguments of the Board.

The First Argument.

It is necessary to bear in mind that the Act provides for the grant of a monopoly for a period of time in exchange for the disclosure of the invention to the public. The Act and the Regulations are carefully cast to provide for time limits within which acts must be done either to obtain the monopoly or to preserve its existence. The Act and the Regulations contain provisions for extension of certain of these times and there are some provisions to safeguard to some extent persons who may have been affected by extensions of time. I will consider this aspect further in relation to the third argument.

The provision in reg.7B(6) of three months after the lapse of an application within which an application for restoration may be made, when read with the provisions of reg.7B(8), makes it clear that at least in some cases "undue delay" within the meaning of those words in reg.7B(8)(c) may occur even within that three month period.

It would be quite illogical for the commencing time from which undue delay is to be measured to be after the date of notification of lapse in the Official Journal. Any order granting leave to make an application for restoration would be expected to contain some time limit within which the application could be made. No submission was made to us that an application for restoration could only be made under reg.7B(8) within the three month period mentioned in reg.7B(6).

The Second Argument.

If an applicant for a patent acts through an agent or attorney, as most do, there is no reason why, prima facie, the acts of the agent should not be treated as the acts of the applicant and any failure to act by the agent as a failure to act by the applicant. It is relevant to consider that in reg.7B(8)(a) the agent and attorney are specifically metnioned. In reg.7B(8)(b) the word "applicant" only is used but it is clear that this word must embrace the applicant's agent or attorney. Indeed that must be conceded by the Board if it is to succeed. In reg.7B(8)(c) there is no mention of whose delay is involved but the words "there has been no undue delay in the making of the application for restoration" should be read as embracing "undue delay" not only attributable to the applicant but also to its agent or attorney.

The learned President did say that the application under reg.7B was not to be granted if there had been "unnecessary or unreasonable delay". I would not think this is necessarily the appropriate test since "unnecessary delay" may not be sufficient to be "undue delay". However I do not consider this aspect to be of any significance in the outcome.

An argument was presented by the Board that regard should be had to the lack of knowledge by the Board of the delay. I cannot accept this approach which would exclude the most outrageous delay by the applicant's agent if unknown to the applicant. The lapse was duly advertised in the Official Journal.

The Third Argument

Applications for standard patents may lapse in the following ways:

(a) Under s.41 of the Act by the failure to lodge the complete specification within 12 months after the date of the application where the complete specification is not lodged with the application. There is no specific provision for the restoration of an application which has lapsed under this section, but s.160(2) may be a source of power to extend the time within which the complete specification may be lodged. Section 160(6) provides for the prescription of protection or compensation for certain persons. Regulations 50 to 52 provide for the case where a person has availed himself, or taken definite steps by way of contract or otherwise to avail himself, of the invention the subject of the application for the patent concerned. Such a person may, subject to certain conditions, apply to the Commissioner for the granting of a licence to make, use, exercise and vend the invention the subject of the application for the patent. The Commissioner, if satisfied that the application should be granted, may grant to the applicant a licence on such terms as the Commissioner thinks just, but, if not so satisfied, the shall dismiss the application. There is no provision for the compensation to any person in regs.50 to 52. A license under reg.52 may not extend beyond the applicant under reg.50.

(b) By failure to comply with the directions of the Commissioner where the Commissioner has accepted a complete specification which does not comply with the requirements mentioned in reg.7B(1). In the case before us power to make the application beyond the three months period specified in reg.7B(6) was accepted to arise because there is no appeal from the extension granted in the proceedings from which this appeal has been brought. The power to grant this extension under s.160 was not in issue before us. Where a lapsed application has been restored under reg.7B(8) I can find no provision in the Act or the Regulations providing protection similar to that where an extension of time is granted under s.160(2). It is to be noted that reg.7B was radically altered by S.R. No. 93 of 1979 when the provisions of reg.16F(2) to (6) were made to apply to the restoration of a lapsed application under reg.7B.

Section 54C of the Act is only relevant where the complete specification has become open to public inspection. Section 124 of the Act deals with the case of an innocent infringer and until publication of the complete specification it is unlikely that any person can be other than an innocent infringer. However, an innocent infringer may have relief granted against him by injunction. A person might very well have expended large sums of money on plant and equipment before the complete specification was open to public inspection and as I have said I see no provisions in the Act or the Regulations for that person to be granted a licence to infringe a patent granted in respect of an application which had lapsed but was restored by the Commissioner under reg.7B(8).

(c) Under ss.53 and 54 of the Act where the application and complete specification have not been accepted within 12 months after the date on which the first report of the Examiner was sent to the applicant. Power is given by s.54(1B) to the Commissioner to extend that period for a further 21 months. Although there is no provision for restoration of a patent which has lapsed under s.53, the 21 month limitation in s.54(1B) makes it appear that the powers under s.160(2) for extension are not available in such a case.

(d) Under s.47C where the applicant does not request the making of an examination of the application and complete specification (1) before the period specified in s.47C(a) and (ii) before the expiration of 6 months after the date on which the direction referred to in s.47C(b) was given. It will also lapse under s.47D where the continuation fee is not paid within the prescribed time. There is provision for the restoration of an application which has lapsed under either s.47C or 47D. Section 47E(8) provides for the prescription of protection or compensation for certain persons. Regulation 16F prescribes the provision for the purposes of s.47E(8) and makes very similar provisions to those set out in regs. 50 to 52. Section 47E(9) excludes s.54C operating during the period between the lapse of the application and its restoration.

There are also provisions in s.68 for the lapse of a patent where the renewal fee has not been paid within the prescribed time. An application for renewal of a lapsed patent may be made under s.97 in certain cases and if it is granted, s.98(4) provides for the prescription of protection or compensation for certain persons. Regulations 42 to 44 deal with the nature of the protection. The Commissioner may grant a licence to make, use, exercise and vend the subject matter of the patent on such terms as he thinks just. Section 98 (5) provides that proceedings shall not be taken in respect of an infringement of a patent committed between the date on which the patent ceased and the date of restoration of the patent.

Another matter to be borne in mind in considering what is "undue delay" in reg.7B(8) is that the specification had not become open to public inspection so that any person wishing to oppose the application for restoration would not know whether the patent affected him except insofar as he could guess the nature of the invention from its title. Clearly the title would not be of any real assistance in this regard. Section 54A(2) makes provision for complete specifications to be notified in the Official Journal as open for public inspection unless the application has lapsed or has been refused or withdrawn.

It is of course important for a person to be able to ascertain whether the subject matter of any claim in a complete specification is likely to affect him. Any delay in the specification becoming open to public inspection is relevant in this regard.

Another matter of importance in considering what is undue delay is that under s.48(4) the obligation of an examiner to report on an application for a patent does not include any obligation to report upon a claim in another complete specification where that other application has lapsed.

Although no substantive argument was directed to this question, it will be seen from what I have said, that I consider neither the Act nor the Regulations provided any opportunity for protection or compensation of a person who, without knowing, availed himself of the subject matter of the application for a patent subsequently granted pursuant to the acceptance of an application which had been restored under reg.7B(8).

It will be seen that I consider very undesirable results may eventuate if undue delay occurs in seeking the restoration of lapsed applications.

It is not possible to ascertain particular persons who may have suffered by any such delay. The onus in reg.7B(8) lay on the Board to satisfy the President that there had been no undue delay. Whether or not hardship upon the applicant should be given significant weight, any hardship is clearly outweighed in this case by the possible prejudice to other people and by the principles upon which the Act is based. In any event it is difficult to quantify the applicant's hardship. The application may or may not have been accepted and any patent, if granted, may or may not have been valid.

The Fourth Argument

The President clearly reserved any question of whether the delay was undue for consideration when considering the application for restoration. It may be that he could, or should, have examined this question when considering the application for extension of time to lodge the application but he did not do so. I express no view on that question. As I have said his decision to extend the time for making the application for restoration was not in issue before us. In any event reg.7B(8) requires the Commissioner, and the Tribunal in an appeal, to decide whether he is satisfied or not that there has been no undue delay. Had he considered this question in considering the application under s.160(2) he surely would have refused that application.

Conclusion.

I would reject all the arguments of the Board.

I am satisfied that whilst this appeal properly lies under s.44 of the Administrative Appeals Tribunal Act no error of law was made by the learned President in deciding the proper construction of reg.7B(8)(c). When that Regulation is properly construed the facts of this case clearly show that the President was entitled to come to the conclusion as a matter of fact that he was satisfied that undue delay had taken place. Indeed, in my opinion, had he come to any other conclusion that conclusion would have been one which was not open to him as a matter of law.

I would dismiss the appeal and order the applicant to pay the respondent's costs of the appeal.