By Joel Secter
Canadian visual artists celebrated on Sparks Street in Ottawa after their appeal to the Supreme Court of Canada was allowed from the bench on May 14, 2014.1 They have been embroiled in a legal dispute with the National Gallery of Canada (NGC) since negotiation of a scale agreement with the iconic institution went sideways in 2007. While the Supreme Court’s reasons did not follow until June 12th,2 and will only directly affect a select few, Canada’s visual artists breathed a collective sigh of relief because the ruling will undoubtedly set the stage for similar negotiations at other institutions across the country.
The case stems from a complaint filed pursuant to the Status of the Artist Act (the “Act”)3 by the Canadian Artists’ Representation/Le Front des artistes canadiens (CARFAC) and Le regroupement des artistes en arts visuels du Québec (RAAV) against the NGC. The Act defines a scale agreement as “an agreement in writing between a producer and an artists’ association respecting minimum terms and conditions for the provision of artists’ services and other related matters.” The definition of producer in the Act includes a government institution such as the NGC, and CARFAC/RAAV are, respectively, the certified artists’ associations for Canadian visual artists outside and within Quebec. At issue was whether granting a license to use an existing artwork can be considered a service provided by an artist.
By way of background, CARFAC/RAAV commenced negotiating a scale agreement with the NGC in 2003. Those negotiations continued for four years before the parties reached an impasse. Relying on an outside legal opinion, the NGC refused to include minimum fees for the licensing or assignment of copyright in existing works in the scale agreement. By way of example, such a provision would require the NGC to pay artists a minimum fee for featuring non-commissioned artworks on its website and in its publications. The NGC argued that copyright is akin to property and therefore could not fall within “services” pursuant to the Act. CARFAC/RAAV viewed the NGC’s refusal to negotiate on copyright as a breach of the latter’s duty to bargain in good faith and filed a complaint with the Canadian Artists and Producers Professional Relations Tribunal (the “Tribunal”), which was responsible for applying and enforcing the Act at the time.
The Tribunal agreed with CARFAC/RAAV and confirmed that scale agreements negotiated under the Act could deal with matters related to copyright.4 Its decision provided that, “…the right to use an existing work is a service that the artist who holds the copyright in that work may provide to a producer, and representing artists’ interests in this fundamental socio-economic right is an appropriate activity for a certified artists’ association.”
However, rather than comply with the Act and resume bargaining, the NGC filed an application for judicial review. A majority in the Federal Court of Appeal (FCA) set aside the Tribunal’s decision on the basis that permitting scale agreements to impose minimum fees for existing works would conflict with the Copyright Act. Writing for the majority, Noel J.A. wrote, “no one would think of describing a transfer of property as a ‘provision of…services’.” However, Pelletier, J.A, writing in dissent, set the stage for this dispute to be heard in Canada’s highest court. He reasoned:
There is nothing surprising in the finding that granting a license to use a work is a service provided by an artist to a producer. The fact that copyright is property does not preclude a finding that granting another the right to use that property is a service. One need only think of hotels and car rental agencies as examples of property owners who provide a service by allowing others to use their property. Thus, the granting of a license is a service provided by the artist, as contemplated by the definition of “scale agreement”.5
The judges of the Supreme Court found this reasoning persuasive and unanimously allowed the appeal, dismissing the NGC’s application for judicial review.
Rothstein J., writing for the Court, reasoned that excluding existing works from these scale agreements would run contrary to Parliament’s express recognition that artists should “be compensated for the use of their works, including the public lending of them.”6 He further stated that the collective bargaining conducted by artists’ associations in respect of scale agreements covering existing artistic works does not contradict any provision of the Copyright Act; the two statutes must be read together in a manner that allows them to work in a complementary fashion.
With the Tribunal’s order reinstated, the parties will resume negotiations after years at a stalemate. While it is hard to say just how far-reaching this decision will be, it does clarify the authority of artist associations under the Act for the purposes of future collective bargaining. Considering this case took so long and presumably ran up quite a high tab, it is worth mentioning that costs were awarded to CARFAC/RAAV on the appeals before the Supreme Court and FCA.
4 Canadian Artists’ Representation (Re),  C.A.P.P.R.T.D. No. 053
6 Supra note 3, s. 2(e).