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Leveraging Knowledge Assets

Under the provincial and territorial secured transactions regimes, the standard default remedy is sale of the collateral. In order to exercise this remedy, there needs to be some mechanism to enable the buyer at the secured creditor’s liquidation sale to be recorded as the new owner in the relevant federal IP registry. At present, secured creditors typically require the borrower to exercise an assignment in registrable form at the time of the initial borrowing that can be used if and when default occurs. Alternatively, the borrower is required to execute a power of attorney in favour of the secured creditor to do whatever is necessary on default to effectuate a sale of the collateral including the execution of an assignment and its submission for registration. The latter is the recommended course, particularly with trade-marks, to avoid any challenge that the mark has lost its distinctiveness in the absence of control by the assignee/secured creditor.¹⁰⁵ In any event, these awkward and burdensome procedures of uncertain effectiveness could be eliminated if the law were to provide an express procedure whereby on presentation of a transfer document executed by the secured creditor n the prescribed form, the Registry were required to record the purchaser as the new owner. Although a procedure of this kind has been recommended for inclusion in the PPSAs¹⁰⁶ to be fully effectual reform at the federal level is required and we so recommend.