Re Dow Chemical Company v Francis John Smith (Commissioner of Patents) and Imperial Chemical Industries Plc v [1984] FCA 349 (20 November 1984)

FEDERAL COURT OF AUSTRALIA

Re: THE DOW CHEMICAL COMPANY
And: FRANCIS JOHN SMITH (COMMISSIONER OF PATENTS) and IMPERIAL CHEMICAL
INDUSTRIES PLC
V. No. G 290 of 1983
(1984) AIPC para 90-143
Patents

COURT

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
Northrop J.

CATCHWORDS

Patents - judicial review - costs - concession that application cannot succeed.

Patents Act 1952 s.59,160

HEARING

MELBOURNE
20:11:1984

ORDER

The application be dismissed with costs.

DECISION

On 25 November 1983 the Commissioner of Patents ("the Commissioner"), pursuant to paragraph 160(2)(a) of the Patents Act 1952 ("the Act"), extended the time in which Imperial Chemical Industries PLC ("I.C.I.") might lodge a notice of opposition under sub-section 59(1) of the Act. The indulgence was granted to I.C.I. in relation to Application No. 529649 in the name of The Dow Chemical Company ("Dow"). Notice of the application was advertised in the Official Journal on 16 June 1983. Under sub-section 59(1) of the Act any notice of opposition should have been lodged on or before 16 September 1983. A notice of objection was lodged by I.C.I. on 30 September 1983 accompanied by an application under paragraph 160(2)(a) of the Act for an extension of time to enable the late lodgement of the objection to be effective. The application for the extension of time was supported by a statutory declaration. Notice of the application was given to Dow which objected to the extension of time being granted. The application was heard by the Commissioner on 18 November 1983 in proceedings in which I.C.I. and Dow were each represented by a patent attorney. In his reasons for granting the extension of time under paragraph 160(2)(a) of the Act, the Commissioner acted on the view that he did not have to decide whether a serious opposition was foreshadowed by I.C.I., a matter that might have been relevant in an application for a further period in which to lodge an objection under the discretion conferred by sub-section 59(1) of the Act; see Vangedal-Nielson v. Commissioner of Patents [1980] FCA 163; (1980) 33 ALR 144 per Bowen CJ at pp.149-50. In passing it is noted that the nature of the discretion under sub-section 59(1) is markedly different from the nature of the discretion under paragraphs 160(2)(a) and (b). Under the former, the application must be made within the three months first mentioned in the sub-section and the further period must not exceed three months. Under the latter, no time is mentioned but the applicant for the extension of time must establish:

"(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."

2. On the material before him, the Commissioner was satisfied that I.C.I. had established that the failure to lodge a notice of opposition within the three month period prescribed by sub-section 59(1) was by reason of an error or omission on the part of the attorney for I.C.I. within the meaning of paragraph 160(1)(a) and in the exercise of his discretion, granted an extension of time to 30 September 1983.

3. On 21 December 1983 Dow commenced these proceedings in the Federal Court seeking an order of review under the Administrative Decisions (Judicial Review) Act 1977 of the decision of the Commissioner. The issues sought to be raised by Dow in the proceedings were whether in law an extension of time could be granted by the Commissioner under paragraph 160(2)(a) for the lodgment of a notice of opposition under sub-section 59(1) and secondly, if so, whether the Commissioner was wrong in law in holding that in granting the extension, he did not need to decide whether I.C.I. intended to propose to mount or was capable of mounting a serious opposition to the grant of letters patent on the patent application made by Dow.

4. Pursuant to directions given in the Federal Court proceedings I.C.I. filed voluminous material which included material directed to establishing the fact that it proposed to mount or was capable of mounting a serious opposition to the grant of letters patent on the patent application by Dow. In addition, the material was directed to show that the patent application by Dow was but a step in a long and involved dispute involving I.C.I. and Dow with respect to the subject matter of the patent application by Dow.

5. When the proceedings in the Federal Court came on for hearing, counsel for Dow announced that having regard to the material filed by I.C.I., but without conceding the accuracy or validity of the material so filed, Dow conceded that the material was sufficient to demonstrate that I.C.I. proposed to mount and was capable of mounting a serious opposition, in the relevant sense, to the grant of letters patent on the patent application by Dow. In those circumstances counsel indicated that he did not wish to proceed further in the application for the order of review but submitted that the application should be dismissed and that Dow's costs of the application should be paid by I.C.I. He submitted that having regard to the reasons for decision given by the Commissioner, the proceedings in the Federal Court would have succeeded but for the change of tactic by I.C.I. and that Dow should not have to pay costs of the respondents to the application.

6. Counsel for the Commissioner and for I.C.I. have submitted that Dow should pay the respondents costs of the application. Counsel referred to s.43 of the Federal Court of Australia Act 1976 which confers jurisdiction on the Court to award costs and in proceedings in the Court, "the award of costs is in the discretion of the Court". No counsel referred to any authority directed to the exercise of discretion to award costs conferred by s.43. The general principle is clear. "It is a general rule that a wholly successful defendant should receive his costs unless good reason is shown to the contrary"; see Milne v. Attorney-General for the State of Tasmania [1956] HCA 48; (1956) 95 CLR 460 per Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ. at p.477.

7. Counsel for Dow did not dispute this general principle but submitted that the Court should consider the matters of law raised by the application under the Judicial Review Act and determine whether the Commissioner was in error in holding that once a reason specified in paragraph 160(2)(a) had been established it was not necessary to decide whether a serious opposition was intended under sub-section 59(1) in order to determine whether to grant an extension of time under paragraph 160(2)(a) to enable a person to lodge an opposition under sub-section 59(1).

8. At the hearing counsel for Dow and I.C.I. made submissions directed to the issue of whether the Commissioner had been in error. To that end counsel for Dow criticized the form of the notice of opposition lodged by I.C.I. on 30 September 1983. Counsel for Dow contended further that the fact that I.C.I. filed material in the Federal Court proceedings directed to establishing a serious opposition constituted a concession that the Commissioner had been in error. On this latter aspect it is salutary to note what was said in Milne v. Attorney General for the State of Tasmania, above, in relation to defences which had been raised but not pursued.

9. Counsel for I.C.I. made submissions directed to showing that the Commissioner was not in error in exercising his discretion to grant an extension of time under paragraph 160(2)(a). He contended further that the discretion under sub-section 59(1) was of a different nature and was directed to the circumstances where a person interested had knowledge of an application for a patent within the specified time of three months but required further time to decide whether to oppose the grant of the patent on that application.

10. During the course of submissions the Court raised the issue of whether on an application for judicial review of this nature, the Court should look at new material not put before the Commissioner even though that material was available at the time of the hearing of the application before the Commissioner and was relevant or may have been relevant to the exercise of the discretion by the Court. The Court does not express an opinion on this issue. The Court did not look at the material filed by I.C.I. but relies upon the concession made by counsel for Dow that the application should be dismissed.

11. In all the circumstances the Court declines to express an opinion on whether the Commissioner was in error or not. That is a hypothetical question which the Court should not answer.

12. The only matter in issue between the parties relates to the costs of the application. The general principle to be applied in awarding costs has been stated. The proceedings were commenced by Dow. The order now sought by Dow is that the application be dismissed. Dow has taken that course for reasons it thinks fit. It is not for the Court to say whether those reasons are adequate or not. It is not for the Court to express an opinion on the question of whether, if Dow had prosecuted the application, it would have succeeded. Further, by submitting that the application should be dismissed, counsel for Dow must be taken to concede that there is no basis to support the first issue sought to be raised in the proceedings, namely whether in law an extension of time could be granted by the Commissioner under paragraph 160(2)(a) for the lodgment of a notice of opposition under sub-section 59(1). Nothing that has been said by counsel for Dow has pursuaded me that there is good reason to depart from the general principle that the successful respondents should recover their costs.

13. The application is dismissed with costs.