21 April 2010

High Court Defines "Aggrieved"

Case: Health World Ltd v Shin-Sun Australia Pty Ltd [2010] HCA 13.

This appeal to the High Court is connected with Section 88(1) of the Trade Marks Act 1995. Only a person "aggrieved" can make use of that section to rectify the register. Rectification can take the form of cancellation, removal or amendment or entering conditions or limitations.

The factual background is worth reading, but I will skip it in this post, but for a brief summation.

Three proceedings took place between the parties before a single judge in the Federal Court and were heard together.  In that court, two of the proceedings were dismissed on the ground that Health World was not a person "aggrieved". The remaining proceeding was dismissed on the ground that Shin-Sun was not a person "aggrieved".


Health World appealed to the Full Federal Court by contesting the primary judge's conclusion that it was not a person "aggrieved". It did not challenge the finding that the marks in question were not deceptively similar. The Full Court agreed with the primary judge's finding that Health World was not a person aggrieved in the two proceedings.

This court gave some reasoning for the "aggrieved person" requirement. It acknowledged that the word has a filtering function. But there appears to be no reason why the word should be construed restrictively rather than liberally.

In its reasoning, the Full Court made reference to Kraft Foods v Gaines Pet Foods Corporation (1996) 65 FCR 104. In that case, it was held that an exhaustive test was used in Ritz Hotel Ltd v Charles of the Ritz Ltd (1988) 15 NSLWR 158. One aspect of the test was that a person claiming to be aggrieved "must demonstrate, to use the language of McLelland J, at least a reasonable possibility of being 'appreciably disadvantaged in a legal or practical sense' by the trade mark remaining on the Register." In using "must" the Full Court in Kraft was adopting an exhaustive test.

This court said that the Full Court should not have followed the Kraft case that was "clearly wrong". McLelland J. did not state any exhaustive test.

It appears that the Kraft case was erroneous in the way that it quoted and emphasised certain aspects of Powell v The Birmingham Vinegar Brewing Co. Ltd  1894 AC 8. One passage quoted from that case contained the following: "...by reason of the existence of the entry upon the register he could not lawfully do that which but for the appearance of the mark upon the register, he could lawfully do, it appears to me that he has a locus standi to be heard as a 'person aggrieved'". But the next, unquoted sentence reads: "In the present case I do not think it can be doubted that the rights of any person who was in the trade and who might desire to make use of the words...would be less if this mark were upon the register than they would ...".

Another passage quoted in the Kraft case was: "It is implied, of course, that the person aggrieved must manufacture or deal in the same class of goods to which the registered mark applies, and that there shall be a reasonable possibility of his finding occasion to use it." But in Powell, Lord Ashbourne said: "In the present case, if free, the respondents might wish to deal in a similar article, and the existence of this mark might hamper and impede them in considering how they would develop and work their business." And Lord Shand said: "It appears to me that where a person is engaged in the same trade as the trader claiming the exclusive right to a registered trade mark consisting, as here, merely of words describing or designating the article manufactured, and where, in the development of his business he may find it advantageous to use the words claimed, he is within the meaning of the statute a 'person aggrieved'".

This court made three points about the Powell case:

1. The language does not suggest that the test is exhaustive.

2. Nothing in the case supported by implication the suggestion that the test was exhaustive. Despite the fact that there was no evidence that the respondents wished or intended to sell Yorkshire Relish, both courts involved held that the respondents were persons "aggrieved". Hence, a possibility of use of the mark unsupported by evidence suffices, even where there is no evidence of an actual desire or intention on the applicant's part to use the mark.

3. Lord Herschell said that the test turned not on whether the application "might desire" to use the mark, but on whether the trade mark "would or might limit the legal rights of the applicant", whatever future course of conduct the applicant actually had in mind or was likely to embark on.

In the Ritz case, McLelland J. said that: "Decisions of high authority appear to me to establish that the expression has no special or technical meaning and is to be liberally construed. It is sufficient for present purposes ... any person having a real interest in having the register rectified, or the trade mark removed ... include any person ..." The words "it is sufficient for present purposes" indicate that McLelland J. was deciding not what the legislature necessitated, but what was sufficient to determine the precise issue presented for decision. He was not offering a complete account of what the legislation meant.

This decision can be concisely summed up by quoting Lord Pearce in Daiquiri Rum Trade Mark [1969] RPC 600: "In my opinion, the words ["person aggrieved"] were intended by the Act to cover all trade rivals over whom an advantage was gained by a trader who was getting the benefit of a registered trade mark to which he was not entitled."

So, Health Plus and Shin-Sun were both "persons aggrieved" because they are in the same trade and they each trade in the class of goods in respect of which the challenged mark is registered.

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