Thank you for your question.
It is in fact much more complicated, but I'll try to give you a short version.
At the very beginning, in 1977, Bill 101 was indeed based on the territorial model. There was room for exceptions, of course, but it really was based on a territorial system.
Mr. Termote might be able to qualify, correct or improve upon what I'm saying, but in the years that followed, meaning the late 1970s and early 1980s, progress was made with respect to French in Quebec, particularly in terms of the most frequently used language of work, and attendance at French-language schools. Various indices clearly demonstrated progress in the late 1970s and early 1980s.
After that, various Supreme Court decisions reduced the amount of protection for French in Quebec. As a result, Bill 101, Quebec's language act, distanced itself from the territorial model and became increasingly personality-based.
By the end of the 1980s, the vitality indices for French had begun to decline again. This of course was partly attributable to various other factors, including immigration policies, but it was clear that it contributed to these changes in legislation.
Concretely, the territorial model aims at making French the dominant language in Quebec by means of various measures such as guaranteeing the right to work in French. There is no equivalent measure or right to work in English in Quebec, but there is a fundamental right to work in French. The predominance of French also applies to things like signage. French is promoted through various measures, but there is room for accommodation.
What's interesting from the legal standpoint is that the principle remains French, while the rules allowing the use of other languages, including English, are exceptions to a strict interpretation. However, the logic of the federal system is based instead on both languages. So if measures are proposed to protect French, they may be considered exceptions to the strict interpretation.
That's why it's probably preferable to apply Bill 101 to federally-regulated private companies rather than create a federal regime that would promote French, but as an exception to the overriding principle of two official languages under federal law. In such a context, a system under which an exception is made to promote French would likely become a matter of strict interpretation. If Bill 101 were to be applied instead, it would be a matter of broad interpretation because the underlying principle of Bill 101 is the protection of French.