Farmer & Co Ltd v Anthony Hordern & Sons Ltd [1964] HCA 58; (1964) 112 CLR 163 (14 October 1964)

HIGH COURT OF AUSTRALIA

FARMER & CO. LTD. v. ANTHONY HORDERN & SONS LTD. [1964] HCA 58; (1964) 112 CLR 163

Trade Marks

High Court of Australia
Taylor J.(1)

CATCHWORDS

Trade Marks - Removal from register - Non-use - Use of associated registered trade mark - Equivalent use - Discretion to accept as proof of use - Grounds upon &which exercised - Onus of proof of reasons justifying exercise - Goods of same description - Use of associated mark by company controlled by proprietor of impugned mark - Trade Marks Act 1955-1958 (Cth), ss. 23 (1.) (b), 38 (1.)*.

HEARING

Sydney, 1964, September 11, 14;
Melbourne, 1964, October 14. 14:10:1964
APPEAL from the Registrar of Trade Marks.

DECISION

October 14.
TAYLOR J. delivered the following written judgment:-
This is an appeal pursuant to s. 23(7.) of the Trade Marks Act 1955-1958 made by the appellant for the removal from the register of the respondent's trade mark "Young Miss Sydney" which was registered on 5th February 1952 in class 38 in respect of "frocks, suits and coats for feminine wear". Class 38 at that time related to "Articles of clothing. Such as hats of all kinds. Caps and bonnets. Hosiery, Gloves, Boots and shoes. Other ready-made clothing". The ground upon which the application was made was that specified in s. 23(1.)(b) of the Act, that is to say that, up to one month before the date of the application, a continuous period of not less than three years had elapsed during which the trade mark was a registered mark and during which there was no use in good faith of the trade mark in relation to the goods in respect of which it was registered. The application to remove the mark was made on 5th May 1961 so that the relevant continuous period of three years was that which began on 4th April 1958 and ended on 4th April 1961. (at p165)

2. The evidence concerning the non-user of the mark was not entirely satisfactory but no case was made by the respondent that the mark had ever been used and in the end it was conceded that there had, in fact, been no direct user of the mark during the relevant period. What was relied upon was, first of all, consistent use during the relevant period by the respondent of an associated trade mark - "Miss Sydney" - of which it was the registered proprietor and which was registered on 20th June 1958 in class 38 in respect of "women's shoes". That there was a consistent user by the respondent of this associated mark in relation to women's shoes is not open to question. Secondly, the evidence shows that since 1959 the respondent has been the beneficial owner of the whole of the ordinary capital of Hordern Bros. Limited, the owner of another department store in Sydney, and that since that year the mark "Miss Sydney" has been consistently used in relation to women's frocks and other wearing apparel sold at that company's store. There was some unsatisfactory evidence that in 1959 the employees of Hordern Bros. Limited became the employees of the respondent and that, in effect, the operations conducted in the former's store were directly conducted by the respondent. Upon this evidence it was suggested that the use of the mark "Miss Sydney" in relation to women's clothing sold in this store was a direct use by the respondent but it is a suggestion which, in my view, cannot be entertained. Indeed, I intimated as much to counsel for the respondent during the hearing and afforded him an opportunity to adduce further evidence in relation to this matter if he wished to persist in the contention that the business operations conducted in the store of Hordern Bros. Limited were directly conducted by the respondent at any relevant time. No advantage was taken of this opportunity and I have no doubt that this was not the situation. It may be true that the respondent had, in one sense, full control of its subsidiary company but the use of the mark in Hordern Bros. Limited's store was a use by that company. Nevertheless, the respondent, relying upon the decision in the Radiation Case (1930) 47 RPC 37 , contended that this use by Hordern Bros. Limited was equivalent, for all practical purposes, to a use by the respondent. (at p165)

3. The question to be resolved is whether I should, in the exercise of the discretion conferred by s. 38 of the Act, accept the proved use of the associated registered trade mark by the respondent "as an equivalent for the use required to be proved" in this case. Of course, what s. 23(1.)(b) requires is proof by an applicant of non-user during the specified period in order to substantiate his application for removal but it is clear that proof by the respondent in such an application of "use in good faith of the trade mark in relation to those goods" during the relevant period will result in the dismissal of the application and there can, I think, be no question that s. 38 authorizes the Court to accept the use of an associated registered trade mark as "an equivalent" for such proof. But that section is silent - no doubt advisedly - as to the basis upon which the discretion should be exercised and leaves to the Court the problem of working this out. In the absence of any guiding authority on the point some general help may, perhaps, be obtained from the observations of the Master of Rolls when speaking of the discretion reposed in the Court by the proviso to s. 26(1) of the English Act of 1938 (J. Lyons & Co. Ltd.'s Application (1959) RPC 120, at p 130). He said: "the discretion in the proviso should, in my judgment, be exercised as a matter of common sense - 'in a business sense' (to cite again Lindley L.J.'s phrase - in the light of all the circumstances of the case, which will, of course, include the nature of the mark itself and the relevant business history of the applicants and the registered proprietor respectively. Again, however, regard must in my view be had to the legislative purpose of the Act, as I have earlier attempted to define it. In other words, the tribunal, bearing in mind all the circumstances of the case, will have to ask itself the question, whether the grant of the application would unfairly or unjustly restrict or invade the statutory monopoly acquired for its trade by the registered proprietor"(1959) RPC, at p 130. It may be observed, however, that the "use" which may be relied upon pursuant to the provisio to s. 26(1.) (the equivalent of s. 23(2.) of the Commonwealth Act) is a use in relation to some of the goods in respect of which the mark is registered, whereas under s. 38 the use which may be accepted as an equivalent to the use required to be proved may be a use in relation to goods which, though of the same description as the goods in respect of which the impugned mark is registered, are not goods in respect of which that mark is registered. Nevertheless, it seems to me the discretion in either case ought to be exercised on the same general principles and I add that, in my view, it is for the respondent in an application such as this to satisfy the Court affirmatively that some reason exists justifying the exercise of the discretion in his favour. However, it was contended before me that "women's shoes" and "frocks, suits and coats for feminine wear" are not goods of the same description, that the two marks should not have been registered as associated marks and that the use by the respondent of the mark "Miss Sydney" in relation to shoes should, therefore, not be held to be a user of an associated trade mark within the meaning of s. 38. I think there is considerable force in the contention that the goods in respect of which each mark is respectively registered are not goods of the same description but it cannot be contested that the mark was, in fact, an associated registered mark, that it was used by the respondent consistently during the relevant period and that, pursuant to s. 38, its use may be accepted as an equivalent for the use required to be proved. Nevertheless, it is of importance to consider, among other matters, the nature of the use made of the mark including the character of the goods in relation to which it was used. (at p167)

4. In dealing with the application it must, I think, be assumed that the appellant has made out a prima facie right to the removal of the mark in question and that an order to that effect should be made unless the circumstances in which the associated mark was used justifies acceptance of the proved use of that mark as equivalent to the use of the impugned mark. Now what use of the associated mark has been proved? It is, as I have already said, beyond question that the respondent has during the relevant period used the associated mark in relation to women's shoes. But no reason has been advanced - and, indeed, I am unable to perceive any - which would justify acceptance of that use, standing alone, "as an equivalent for the use" of the impugned mark in relation to frocks, suits and coats for feminine wear, even if it be proper - which I doubt - to treat women's shoes as goods of the same description. However, the respondent also relies upon the use of the associated mark during the relevant period by Hordern Bros. in relation to articles of women's clothing such as frocks, suits and coats and asserts that I should have regard to this use as, in effect, a use by the respondent. If it were proper to do this I would be disposed to dismiss the application but I am of the opinion that the decision in the Radiation Case (1930) 47 RPC 37 does not support the respondent's contention. There is, in my opinion, a clear distinction between the facts of that case and those of the present case. In that case the evidence showed that the applicant constantly exercised rights of selection as to what articles should be produced and sold by its associated companies and it maintained a testing establishment to ensure that approved manufacturing procedures and standards were observed and maintained and, treating "the question as a practical one", the Comptroller-General held that the mark in question was registrable upon the application of the applicant as, in effect, a "house mark" of the whole group of associated companies. But in the present case no equivalent circumstances are present. To all intents and purposes Hordern Bros. Limited conducted its store as a completely separate undertaking notwithstanding the fact that in one of the many advertisements tendered in evidence it appears that it was described as an "Anthony Horderns Store". It may be that the respondent, as the sole shareholder, dictated the buying and selling policies of Hordern Bros. Limited but in the public eye the use of the associated mark in that company's store during the relevant period was a use by Hordern Bros. Limited in relation to goods which it had purchased or manufactured and it was, in no sense, used by the respondent or to indicate any connexion in the course of trade between the respondent and the goods upon which the mark was used. The Registrar took a different view on this point observing that he thought that authority favoured the respondent "in its recognition of use by wholly owned subsidary companies as use by the parent company". I think this proposition is too widely stated and I have reached the conclusion that an order should be made for the removal of the mark from the register. I should add that I do not regard as a material circumstance the fact that after the date when this application was lodged Hordern Bros. Limited became a registered user of the mark "Miss Sydney". (at p168)

ORDER

Appeal allowed with costs. Order that the trade mark "Young Miss Sydney" registered on the application of the respondent on 5th February 1952 be removed from the Register of Trade Marks.