ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO: CV-12-463641
DATE: 20131122

B E T W E E N:

Certified General Accountants Association of Ontario

Applicant

• and -

American Institute of Certified Public Accountants, Chartered Institute of Management Accountants, Canada Inc., Chartered Institute of Management Accountants, Association of International Certified Professional Accountants, Mohandas Puzhankara, Damien Martin, Carlos Lameiro, Dev Devendra, and John Doe

Respondents

Clifford I. Cole & Laurent Massam,
for the Applicant

Bruce Stratton & Henry Lue,
for the Respondents

HEARD: August 22, 2013

FIRESTONE J.

REASONS FOR DECISION

[1] The Certified General Accountants Association of Ontario (“CGA Ontario”), the Applicant, brings this application for a statutory injunction pursuant to section 30(1) of the Certified General Accountants Act, 2010, S.O. 2010, c. 6, Schedule A (“CGA Act”)[^1] to prohibit the Respondents from contravening section 26 of the CGA Act.

[2] The Applicant argues that the Respondents have contravened section 26 of the CGA Act by taking and using the acronym CGMA, which stands for Chartered Global Management Accountant, as an accounting designation in the province of Ontario. The Respondents argue that section 26 of the CGA Act does not expressly prohibit the use of the CGMA designation in Ontario.

[3] The CGMA designation was developed and promoted worldwide by the Association of International Certified Professional Accountants (“the joint venture”), which was formed by two of the world’s largest associations of accountants, namely, the American Institute of Certified Public Accountants (“AICPA”) and the UK-based Chartered Institute of Management Accountants (“CIMA”). CGMA was intended to be a global accounting designation for management accountants.

The Parties

[4] CGA Ontario is a professional body that is statutorily mandated to self-regulate individuals and firms designated as Certified General Accountants, aka “C.G.A.” or “CGA”, in Ontario. CGA Ontario derives its jurisdiction pursuant to the CGA Act and is responsible for granting the exclusive right to use the designation CGA in the province of Ontario. It also has the responsibility of enforcing section 26 of the CGA Act.

[5] The Respondents, AICPA and CIMA, are American and British accounting organizations. AICPA does not have any affiliated business or branch offices in Canada. CIMA has a presence in Canada through its Canadian branch, which operates under the name the Chartered Institute of Management Accountants, Canada Inc. (“CIMA Canada”). CIMA Canada is also a named Respondent, but does not have a physical office in Canada. In January 2012, AICPA and CIMA formed the joint venture to promote and support the CGMA designation on a worldwide basis including the province of Ontario. In addition the Respondents include four individual accountants who have been using the CGMA designation in Ontario and John Doe.

Applicable Statutory Framework

[6] Three statutes have been enacted to regulate the accounting profession in Ontario. Each prohibits taking or using certain designations. These Acts are the CGA Act, the Certified Management Accountants Act, 2010, S.O. 2010, c. 6, Schedule B (“CMA Act”) and the Chartered Accountants Act, 2010, S.O. 2010, c. 6, Schedule C (“CA Act”).

[7] The relevant subsections of 26(1) and (4) of the CGA Act state as follows:

Prohibition, individuals

(1) No individual, other than a member of the Association, shall, through an entity or otherwise,

(a) take or use the designation “Certified General Accountant” or “comptable général accrédité”, or the initials “C.G.A.”, “CGA”, “F.C.G.A.” or “FCGA”, alone or in combination with other words or abbreviations;

(b) take or use any term, title, initials, designation or description implying that the individual is a Certified General Accountant;

Prohibition, corporations

(4) No corporation, other than a professional corporation that holds a valid certificate of authorization, shall,

(a) take or use the designation “Certified General Accountant” or “comptable général accrédité”, or the initials “C.G.A.”, “CGA”, “F.C.G.A.” or “FCGA”, alone or in combination with other words or abbreviations;

(b) take or use any term, title, initials, designation or description implying that the corporation is entitled to practise as a Certified General Accountant;

[8] Sections 26(2) and (5) of the CGA Act state as follows:

Exceptions-Individuals

(2) Clauses (1) (a) and (b) do not apply to an individual in any of the following circumstances:

1. The individual uses a term, title, initials, designation or description when making reference to authentic professional accounting qualifications obtained by the individual from a jurisdiction other than Ontario in,

i. a speech or other presentation given at a professional or academic conference or other similar forum,

ii. an application for employment or a private communication respecting the retainer of the individual’s services, if the reference is made to indicate the individual’s educational background and the individual expressly indicates that he or she is not a member of the Association and is not governed by the Association, or

iii. a proposal submitted in response to a request for proposals, if the reference is made to demonstrate that the individual meets the requirements for the work to which the request for proposals relates.

2. The individual uses a term, title, initials, designation or description as authorized by the by-laws.

Exceptions-Corporations

(5) Clauses (4) (a) and (b) do not apply if a corporation uses a term, title, initials, designation or description when making reference to authentic professional accounting qualifications obtained by the corporation from a jurisdiction other than Ontario in a proposal submitted in response to a request for proposals, if the reference is made to demonstrate that the corporation meets the requirements for the work to which the request for proposals relates.

[9] Section 30(1) of the CGA Act authorizes CGA Ontario to bring an application for a statutory injunction in the Superior Court of Justice against persons who have contravened section 26 of the CGA Act.

Factual Background

[10] The Chartered Global Management Accountant designation-acronym “CGMA” was announced in or around March 2011 by the joint venture as a new global accounting designation for management accountants.

[11] After the announcement, the joint venture promoted the new CGMA designation worldwide by way of media coverage, web presence, traditional advertising, and a launch event. Such advertising was meant to promote the objectives of the AICPA and CIMA, namely to establish a preeminent global standard of professional excellence in management accounting.

[12] Currently there are approximately 140,000 to 145,000 management accounting professionals in over 140 countries who hold the CGMA designation. In Canada, there are approximately 440 AICPA members and approximately 900 CIMA members who have been granted the right to use the joint venture’s CGMA designation.

[13] On March 25, 2011, the joint venture filed trademark applications for the word-mark “CGMA” in Canada and other countries. The application in Canada is being opposed by CGA Ontario. Before the trademark applications were filed, the AICPA and CIMA performed global searches, which revealed that the CGMA designation had not been used anywhere in the world. However, AICPA confirmed on cross-examination that it did not take measures to ensure that the CGMA designation did not create confusion for consumers.

[14] When the CGA Act came into force in May 2010, CIMA published a document titled “Guidance for Ontario.” In the document examples were given of accounting designations that were prohibited in Ontario based on the section 26 of the CGA Act. In 2011, around the same time that the joint venture began promoting the CGMA designation, CIMA amended the guidance document to warn against using the CGMA designation in Ontario.

[15] On cross-examination, CIMA admitted it added a warning because of their concern that CGMA varied from CMA by one letter. In correspondence dated May 11, 2012, CGA Ontario made a complaint to CIMA regarding the use of CGMA on the basis that CIMA was violating section 26 of the CGA Act. The warning regarding the use of CGMA was, however, subsequently removed from the guidance document by CIMA.

[16] CGA Ontario announced in April 2012 it would offer its own CGMA designation for a “Certified Global Management Accountant.” This announcement appeared on its website, newsletter, and was included in its by-laws. At the same time, CGA Ontario sought to have the Registrar of Trademarks declare CGMA an official mark of CGA Ontario.

Issues for Determination

1. Does the Respondents’ use of CGMA contravene section 26 of the CGA Act?

2. If section 26 has been contravened, should a statutory injunction be granted pursuant to section 30(1) of the CGA Act?

3. Does the Respondents’ use of CGMA contravene s. 26 of the CGA Act?

Position of the Parties

[17] CGA Ontario submits that the use of CGMA in Ontario by the Respondents is a breach of sections 26(1)(a), 26(4)(a), 26(1)(b), and 26(4)(b) of the CGA Act. CGA Ontario highlights the well-established principle of statutory interpretation reiterated by the Supreme Court of Canada in Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26:

The words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

[18] CGA Ontario argues that the legislative intention of s. 26 of the CGA Act can be discerned from Hansard. They argue it was enacted by the Government of Ontario to protect the public from confusion about the qualifications of professional accountants. The Applicant submits that the use of foreign unregulated accounting designations in Ontario that are the same or similar to regulated accounting designations can confuse the public.

[19] The phrase “alone or in combination with other words or abbreviations” contained in sections 26(1)(a) and 26(4)(a), CGA Ontario argues, is not restricted to the placement of words or abbreviations placed immediately before or after the protected designations in the subsections.

[20] CGA Ontario states the designations that are prohibited do not need to have the same sequential letters as the protected designations. Because the subsections protect the use of “C.G.A.” and “CGA” alone or in combination with other words or abbreviations, CGMA necessarily falls within the scope of a prohibited designation. The only difference is one single letter, namely the letter “M.”

[21] It submits that for the purposes of ss. 26(1)(b) and 26(4)(b), the test to determine whether the use of CGMA implies the person is a Certified General Accountant is whether a lay member of the public would believe the use of CGMA implies that the person is in fact a Certified General Accountant: see Inst. Chartered Accountants of Man. v Bellamy, 1926 242 (MB KB), [1926] 4 D.L.R. 230 (Man. K.B.), aff’d 1927 307 (MB CA), [1927] 3 D.L.R. 1071 (Man. C.A.), at pp. 233-234. It is argued that the subjective intention of the person using the impugned designation is irrelevant.

[22] In R. v. Langley (1959), 1959 300 (AB CA), 23 D.L.R. (2d) 285 (Alta. C.A.), the majority of the Alberta Court of Appeal found the use of the phrase “certified public accountant” implied the respondent was a certified accountant, which was prohibited under a similarly worded accounting statutory provision. The court noted as follows, at p. 292:

The addition of such a qualifying adjective would denote the particular kind of an accountant such a person is, but the implication would continue to remain that he is a certified accountant, though of a particular kind.… I am of the opinion that the insertion of the word “Public” between the words “Certified” and “Accountant,” does not prevent the full force of the statute applying to make such use an offence.

[23] The point is that the initials C.G.A. as well as the CGA designation are well-known and uniquely associated with Certified General Accounting in Canada. The CGMA designation on the other hand is new and relatively unknown. Therefore, the use of CGMA by the Respondents causes the very deception that was intended to be prevented and avoided by the application of the section 26 prohibitions.

[24] The Respondents, on the other hand, submit that while they agree on the principle of statutory interpretation to apply in this case, the Supreme Court of Canada in Laporte v. College of Pharmacists of the Province of Quebec, 1974 205 (SCC), [1976] 1 S.C.R. 101, at pp. 102-103, has held statutes creating professional monopolies must be strictly construed. Given the CGA Act is a statute that creates a professional monopoly for Certified General Accountants in Ontario, the Respondents argue that section 26 of the CGA Act should be interpreted strictly.

[25] It is acknowledged that section 26 of the CGA Act has not been interpreted by the courts previously. The Respondents submit that the purpose of the CGA Act is not to broadly regulate the accounting profession. Section 2 of the CGA Act states “this Act does not affect or interfere with the right of any person who is not a member of the Association to practise as an accountant.” The purpose of the CGA Act also includes preventing confusion between CGA Ontario members and non-members. The specific language of s. 26(1), they submit, must be interpreted in the context of the goals and objectives of the legislation as a whole.

[26] The purpose of s. 26 is to prevent confusion by the public regarding persons improperly using Ontario regulated accounting designations. It is important to note that the section contains exceptions to the general prohibition.

[27] The Respondents argue that on an ordinary reading of s. 26(1)(a), no individual shall take or use “the” designation alone or in combination with other words or abbreviations. They argue that the subsection applies to a use or taking of the designations as enumerated and not a use or taking of component parts of the designations. The key point is that the subsection does not protect the individual letters, C, G, and A. The legislature specifically and carefully identified the protected designations by quotes around each designation. Therefore, acronyms not enumerated in the subsection should not receive the special status afforded by s. 26(1).

[28] The Respondents submit that the list of protected designations in s. 26(1) is consistent with the purpose of the CGA Act, which is to prevent public confusion related to accounting designations.

[29] The Applicant’s position, according to the Respondents, leads to an absurd and illogical interpretation that must be avoided. If the use of CGMA was prohibited under the CGA Act, then CGA and CMA would be in violation of the CA Act because it prohibits the use of CA alone or in combination with other words or abbreviations. At the same time CGA and CMA are protected under their respective Acts. The Respondents also state that during the legislative process submissions focused on the exact grouping of letters being prohibited under the CMA Act, not the CGA Act.

[30] According to the Respondents, if the Applicant’s interpretation is accepted, the result is that the CGMA designation will be used worldwide except in Ontario. This will lead to heightened public confusion regarding accounting designations in Ontario. Management Accountants in Ontario will be prohibited from using the CGMA designation and s. 26 will effectively prohibit designations in any field that use the individual letters C, G, and A.

[31] Use of CGMA does not, in the Respondents’ view, imply a Certified General Accountant in Ontario. The promotion of the CGMA designation closely connects it to a globally recognized, new and different, accounting designation. The accounting profession currently uses and has similar looking acronyms. The Respondents submit that consumers of the CGMA designation are sophisticated managers in global business and are able to distinguish between Ontario accounting designations and the CGMA accounting designation. Such consumers of these designations do pay attention to small differences. They also note that the Applicant has adduced no evidence that the public will be harmed or confused by the CGMA designation.

Analysis

[32] In determining whether the use of CGMA contravenes s. 26 of the CGA Act, the section must be read in its context and its ordinary meaning harmoniously with the scheme of the Act, the object of the Act, and the legislative intent. Other principles of interpretation are not engaged unless the provision has ambiguous meaning.

[33] In Laporte a unanimous court established a specific principle of interpretation for profession regulating statutes as follows, at pp. 102-103:

The statutes creating these professional monopolies, sanctioned by law, access to which is controlled and which protect their members in good standing, who meet the required conditions against any competition, must however be strictly applied. Anything which is not clearly prohibited may be done with impunity by anyone not a member of these closed associations.

Grammatical and Ordinary Sense: ss. 26(1)(a) and 26(4)(a)

[34] Subsections 26(1)(a) and (4)(a) provide no individual or corporation shall take or use the designation “Certified General Accountant” or the initials “C.G.A.”, “CGA” alone or in combination with other words or abbreviations. The nature of the prohibition is taking or using, the object of the prohibition is “the designation” and “the initials”, and the scope of the prohibition is “alone or in combination with other words or abbreviations.”

[35] Breaking this section down, the sanctioned activities are

• taking or using the enumerated designations or initials alone.

• taking or using the enumerated designations or initials combined with other words or abbreviations.

[36] Members of the profession are exempted from these prohibitions and there are limited circumstances where individuals and corporations are exempted. This includes the use of a designation that is similar to the protected designation-initials in a speech by an individual, but that designation was obtained outside of Ontario.

[37] It is important to consider the object of the prohibition. The definite article “the” indicates the prohibition specifically refers to the enumerated double quoted phrases and abbreviations. The objects of the prohibition read as follows:

• the designation “Certified General Accountant”

• the designation “comptable général accrédité”

• the initials “C.G.A.”

• the initials “CGA”

• the initials “F.C.G.A.”

• the initials “FCGA”

[38] In my view, the use of double quotes around each abbreviation leads to the conclusion that it is the specific permutation of letters and punctuation as opposed to each individual letter that is protected. The issue then is whether the Respondent’s use of CGMA constitutes a taking or use of the initials “CGA” in combination with other words and abbreviations.

[39] The plain meaning of “the initials … ‘CGA’ … in combination with other words and abbreviations” is an object of the prohibition, CGA, being combined with other words and abbreviations. A combination is defined as “a combined set of things” and “a selection of a given number of elements from a larger number of elements, without regard to the order of the elements chosen”; words are defined as “a sound or combination of sounds forming a meaningful element of speech usually shown with a space on either side of it when written or printed, used as part of a sentence”; and abbreviations are defined as a “shortened form of a word or phrase”: see Canadian Oxford Dictionary, 2d ed., s.v. “combination”, “word”, and “abbreviation”.

[40] The letter “M” in CGMA would, in my view, qualify as an abbreviation. This is because M is the short form for the word Management. The definition of “combination” suggests each of the objects of the prohibition and “other words and abbreviations” are unified, unbreakable elements. Consequently, CGA is an element and the abbreviation “M” is an element. Thus, the following combinations of these two elements are, in my view, prohibited: “MCGA”, “CGAM”, “C.G.A.M.”, and “M.C.G.A.”.

[41] CGMA is not clearly prohibited because the meaning of “combination” does not imply the “M” element can be inserted into the middle of the “CGA” element.

[42] The legislature chose to add double quotes around the protected designations and use the phrase “in combination with” instead of simply “with.” In choosing narrower language and punctuation, the legislature narrowed the possible permutations of designations that are prohibited.

Context: ss. 26(1)(a) and 26(4)(a)

[43] The CGA Act is one of three statutes governing the accounting profession in Ontario and came into force on May 18, 2010. It regulates Certified General Accountants in Ontario by imposing conditions of membership, overseeing disciplinary procedures for members, and enforcing general prohibitions against non-members who practise or hold themselves out as CGAs. The CMA Act regulates Certified Management Accountants and the corresponding CMA designation in Ontario. The CA Act regulates Chartered Accountants and the corresponding CA designation in Ontario. The overall objective of the statutes is to allow these various accounting bodies to oversee their profession and protect the public in the public interest.

[44] In accordance with Bell ExpressVu, at para. 46, the various provisions in each statute should be read in the context of the others and consideration should be given to each statute’s role in the overall scheme.

[45] The Hansard debates regarding the virtually identical prohibitions in the CMA Act are equally applicable to the corresponding s. 26 prohibitions in the CGA Act. The stated purpose of the prohibitions in Hansard is to protect “clients of Ontario accountants from confusion about the qualifications or oversight of their professional advisors.”

[46] A reading of Hansard discloses that such prohibitions were said to restrict the use of foreign designations that may be confused with Ontario designations, but the use of designations that will not reasonably be mistaken as Ontario designations will not be restricted.

[47] In analyzing ss. 26(1)(a) and (4)(a) in this context, the prohibitions are intended to protect the public interest and restrict the use of foreign designations that may confuse the public into thinking it is an Ontario designation. From this perspective, in my view, the CGMA designation would likely not be confused with the Ontario regulated CGA.

[48] It is important to consider the long form of CGMA. A Chartered Global Management Accountant is significantly different from a Certified General Accountant. A member of the public and sophisticated managers in global business on balance would be able to distinguish between the two designations especially once they hear the long form of the abbreviation.

[49] Considering the ordinary grammatical meaning of s.26 of the CGA Act, the context of the provision in the larger regulatory scheme, the manner in which the CGMA designation was promoted, as well as the meaning of the designation, CGMA is different enough from the CGA designation so as to not confuse the public into thinking it is an Ontario regulated designation. In my view, it falls outside the scope of the prohibited uses of CGA designations as indicated above.

[50] If there is ambiguity in the provision based on the ordinary grammatical meaning and context, the CGA Act is to be strictly interpreted given that it creates a professional monopoly for Certified General Accountants.

[51] I, therefore, find that the CGMA designation is not clearly prohibited under ss. 26(1)(a) and 26(4)(a) of the CGA Act.

Grammatical and Ordinary Sense: ss. 26(1)(b) and 26(4)(b)

[52] Subsections 26(1)(b) and 26(4)(b) provides that no individual or corporation shall take or use any initials or designation implying the individual or corporation is a Certified General Accountant.

[53] As with ss. 26(1)(a) and 26(4)(a), the subsections are an absolute prohibition with the same limits and exceptions. The prohibition is that of taking or using and the object of the prohibition is “initials or designations.” The scope of the prohibition is “implying” that the person is a Certified General Accountant. In order for the sections to apply, the use of any term, title, initials, designation or description is not enough. They must in fact “imply” that the individual is a Certified General Accountant.

[54] The question is whether the use of CGMA, in fact, implies a person is a Certified General Accountant. The word “imply” means to “strongly suggest the truth or existence of the thing not expressly asserted” or “signify”: see Canadian Oxford Dictionary, 2d ed., s.v. “imply”.

Context: ss. 26(1)(b) and 26(4)(b)

[55] The prior contextual analysis is applicable. Like ss. 26(1)(a) and 26(4)(a), these sections are intended to protect the public from confusing foreign designated accountants with local designated accountants.

[56] The abbreviation, CGMA, does not in my view suggest a Certified General Accountant. This is clear when looking at the long form of CGMA. A Chartered Global Management Accountant does not strongly suggest or imply that a person is a Certified General Accountant. The only common word between the two designations is “Accountant.” This case is distinguishable from Langley in that Langley concerned the use of the long form of “certified accountant”, not the use of initials. Also, a Chartered Global Management Accountant is not a particular kind of Certified General Accountant nor does CGMA have a qualifying adjective that would denote it is a particular kind of Certified General Accountant. Management accountants are focused on accounting for business organizations, whereas certified general accountants are more general in scope by working in various contexts such as government, non-for-profits, and public accounting.

[57] Following the test from Bellamy, the public, in my view, would likely understand that management accountants are functionally different from general accountants and that the word “Global” indicates a worldwide designation. It does not indicate an Ontario-related or Ontario-based designation.

[58] As well, a member of the public can easily ascertain the long form of CGMA by searching for “CGMA” on the internet, which returns the CGMA global accounting designation’s website.

[59] Therefore, I do not find that the use of CGMA implies a person is practising as a Certified General Accountant pursuant to ss. 26(1)(b) or 26(4)(b).

Disposition

[60] Since the Applicant has not met the onus on a balance of probabilities that the Respondents have contravened s. 26 of the CGA Act, a statutory injunction should not be granted. The application is therefore dismissed.

[61] If the parties are not able to agree on costs I may be contacted in order to set a timetable for the delivery of cost submissions.

FIRESTONE, J.

DATE: November 22, 2013

Footnote

[^1]: The CGA Act received royal assent on May 18, 2010 in the form of Bill 158, An Act to repeal and replace the statutes governing The Certified General Accountants Association of Ontario, the Certified Management Accountants of Ontario and The Institute of Chartered Accountants of Ontario, Accounting Professions Act, 2nd Sess., 39th Parl., Ontario, S.O. 2010, c. 6.