Inquiries as to damages in South African intellectual property law

• Jurisdiction: South Africa
• Citation: (1998) 10 SA Merc LJ 145
• Pages: 145-172
• Author: Roshana Kelbrick
• Published date: 25 May 2019
• Date: 25 May 2019

Inquiries as to Damages in South African

Intellectual Property Law

ROSHANA KELBRICK*

University of South Africa

1 Introduction

Awards of damages for intellectual property infringement are not

uncommon in England. By contrast, such awards are extremely rare in

South Africa, despite numerous decisions in which findings of

infringement have been made. In this article, the procedure which must

be followed when damages are sought is investigated to determine

whether it affects the grant of awards of damages.' In English law, once a

finding of liability has been made, an inquiry

2

as to damages is ordered,

while in South Africa, action procedure culminating in a trial has

traditionally been necessary to obtain any award of damages.

This article starts with a study of the English procedure. The reasons for

the separation of merits and quantum are briefly sketched, and an attempt

is made to distinguish between a separation of issues and an inquiry as to

damages. An inquiry is the usual order given when damages are sought in

intellectual property proceedings. The current procedure before and on

inquiry is detailed. The status of a judgment after an inquiry and matters

incidental to such a judgment are set out. Finally, problems encountered in

England with the implementation of inquiry procedure are considered.

In South Africa, unliquidated damages are obtained by way of action

procedure. This procedure is dealt with in general terms, after which

orders for a separation of issues are considered. But statutory provision

has recently been made for inquiries as to damages in proceedings for the

infringement of intellectual property rights. Before this legislation, some

attempts were made to introduce inquiries into South African practice.

They are briefly described. The distinction between inquiries and a

separation of issues in South Africa is considered. Finally, the advantages

of the English inquiry procedure and legislative changes required to

ensure its local acceptance are discussed.

2 The English Inquiry Procedure

Current legislation grants the Chancery Division exclusive jurisdiction

to hear intellectual property matters.

3

Even before such legislation, these

* BA (Pret) LLB (Stell) LLM LLD (Unisa). Associate Professor in the Department of Criminal

and Procedural Law, University of South Africa.

Damages for intellectual property infringement are always viewed as unliquidated, and so

only the procedure to obtain unliquidated damages is considered.

2

English legislation and decisions use the spelling 'inquiry' while South African legislation

refers to an 'enquiry'. The English form is used except in quotations.

3

Currently s 61(1), read with schedule 1 para 1(i) of the Supreme Court Act 1981 (c 54),

assigns all causes and matters relating to patents, trade marks, registered designs, copyright, or

145

(1998) 10 SA Merc LJ 145

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146



(1998) 10 SA Merc LJ

matters were traditionally brought in this division, where jury trials were

a rarity and the court was accustomed to referring accounts and inquiries

to court officials. Assessment of damages by the court itself, or by a jury,

as the position was before fusion of the courts when only common-law

courts could award damages, became increasingly less common. The

current situation is that assessment of damages by a court is the exception

rather than the rule. A court hearing an intellectual property infringe-

ment matter will order an inquiry as to damages rather than award

damages per se.

4

2.1 Distinction between a Split Trial and an Inquiry

There is a greater acceptance of the separate determination of liability

and quantum in English law than in South African law. This may be

ascribed to both common-law and chancery practice. The traditional

approach at common law, whereby a judge determined liability and then

referred assessment of damages to a jury, has resulted in the view that

damages are not determined at a trial on the merits, but at a later stage.

In chancery proceedings, the calculation of damages is frequently

complicated,

5

so these courts have also assumed that the calculation of

damages will be postponed for later determination.

6

The separation

of issues, for separate trials on liability and damages, is usually deter-

mined before trial by order of court

7

or in terms of a summons for

directions.

8

It is usually granted only if there is a clear indication that the

issues of liability and damages are sufficiently distinct.

9

An inquiry as to damages also presupposes that merits and quantum

are not considered together. However, this is not viewed as a splitting of

trials, and it is not necessary to obtain leave to have damages determined

at an inquiry once the merits have been decided. The reason for this is not

clear, but is probably linked to the historical development of the inquiry

design rights to the Chancery Division. The Court of Appeal held in

McCain International Ltd v

Country Fair Foods Ltd

[1981] RPC 69 at 82 that passing-off matters should be brought in the

Chancery Division; see also

Kerly's Law of Trade Marks and Trade Names

12 ed (1986) by

TA Blanco White & Robin Jacob 431.

Both Kerly (op cit note 3 at 327) and Christopher Wadlow

(The Law of Passing-off

2 ed

(1995) 580) assume that if anything other than nominal damages are awarded, the order will be for

an inquiry, and the court will not itself assess damages. See also

Smith Kline & French Laboratories

Ltd v Doncaster Pharmaceuticals Ltd

[1989] 1 FSR 401 at 403, where the defendant's request for

the court to order payment of a sum rather than an inquiry was described as 'somewhat unusual'.

5

Odgers on High Court Pleading and Practice

23 ed (1991) by DB Casson 374.

6

In

British Thomson-Houston Co Ld v G and R Agency

(1925) 42 RPC 305, a patent decision,

the court, after postponing judgment to canvass the issue with other judges, held as follows: 'The

proper form of order in these cases, as in all other motions for judgment in the Chancery Division,

where damages are given, will be: — Direct an inquiry as to damages' (at 306). See also

TA Blanco White

Patents for Inventions

4 ed (1974) 427n62: 'It is, of course, normal Chancery

procedure, that the court does not assess damages at the trial but orders an inquiry.'

7

Rules of the Supreme Court Order 33,r.3.

8

Rules of the Supreme Court Order 25,r.1 read with 33,r.4(2).

9

Jack IH Jacob (ed)

The Supreme Court Practice 1995 vol

1 (1994) 1995) 593; Lord Hailsham

of St Marylebone (ed)

Halsbury's Laws of England

vol 37

Practice and Procedure

4 ed (1982) by

Jack IH Jacob 69.

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