Protective Mining & Industrial Equipment Systems (Pty) Ltd (Formerly Hampo Systems (Pty) Ltd) v Audiolens (Cape) (Pty) Ltd

• Jurisdiction: South Africa
• Citation: 1987 (2) SA 961 (A)

Protective Mining & Industrial Equipment Systems (Pty) Ltd (Formerly Hampo Systems (Pty) Ltd) v Audiolens (Cape) (Pty) Ltd
1987 (2) SA 961 (A)

1987 (2) SA p961

Citation	1987 (2) SA 961 (A)
Court	Appellate Division
Judge	Corbett JA, Hoexter JA, Grosskopf JA, Nestadt JA and Nicholas AJA
Heard	February 23, 1987
Judgment	March 30, 1987

Flynote : Sleutelwoorde

Trade and trade mark — Trade mark — Infringement — Section 44(1 )(a) of Trade Marks Act 62 of 1963 — 'Unauthorised use' in s 44(1 )(a) — Meaning of — No more than well-established rule of trade mark law, viz that proprietor has right to prevent others from selling goods I which, while not his, are marked with his mark.

Trade and trade mark — Trade mark — Infringement — Section 44(1 )(a) of Trade Marks Act 62 of 1963 — 'Use as trade mark' — Meaning of in context of section — Expression connoting use only in respect of goods other than J 'genuine' goods.

1987 (2) SA p962

A Trade and trade mark — Trade mark — Infringement — Section 44(1)(a) of Trade Marks Act 62 of 1963 — Trade mark proprietor appointing sole distributor to distribute goods marked with its trade mark in South Africa — South African retailer purchasing and importing genuine products, properly B marked with trade mark by or on behalf of trade mark proprietor and selling same in South Africa — Such conduct not amounting to infringement — Such conduct not covered by s 44(1)(a) of Act since trade mark attached to 'genuine' goods of trade mark proprietor.

Headnote : Kopnota

The appellant had been the exclusive distributor in South C Africa of cameras and related goods manufactured by a Japanese company, Asahi, and marketed under the trade mark 'Pentax' since 1956. Asahi was the proprietor in South Africa of the trade mark 'Pentax' registered pursuant to the Trade Marks Act 62 of 1963. The appellant had become aware in 1982 that the respondent company, a retailer of cameras and related goods, had imported into South Africa and had offered for sale Pentax branded goods. The goods were genuine Asahi products, bearing the Pentax trade mark affixed thereto by or on behalf D of Asahi itself, and had been purchased by the respondent company in Hong Kong. The respondent had been able to sell the products profitably at a price lower than that charged in the retail trade for similar goods imported by the appellant. Asahi and the appellant had written to the respondent in November 1982, pointing out that in their view the respondent had 'used' the Pentax trade mark, that such use had been unauthorised and had therefore infringed Asahi's and the appellant's rights in E the trade mark. They had asked for the respondent's assurance that it would refrain from importing or selling Pentax branded goods in South Africa other than those it could purchase from the appellant. The respondent had declined to give the assurance sought and had denied that, by obtaining genuine Pentax branded goods manufactured by Asahi from a legitimate source and selling such goods in South Africa, it could have in any way infringed Asahi's trade mark.

In April 1984 the appellant had applied to a Provincial F Division for various forms of relief against the respondent, including orders interdicting the respondent from unlawfully competing with the appellant in two respects, viz, firstly, by selling foreign Products under the 'Pentax' trade mark and, secondly, by informing purchasers that such products had been warranted against defects and that such warranty would be honoured by the appellant, its agents and its distributors. Its application had been dismissed. In an appeal, the latter claim G was rejected on the evidence. In support of its claim for an interdict preventing the respondent from unlawfully competing with the appellant by selling foreign products under the trade mark 'Pentax', the appellant argued that the respondent had committed an infringement of Asahi's trade mark within the meaning of s 44(1)(a) of the Trade Marks Act 62 of 1963 by its 'unauthorised use' thereof, and that by so doing its conduct had amounted to unlawful competition, actionable at the suit of the appellant.

Held, that it was clear that the mark 'Pentax' had been placed H upon the cameras in question for the purpose of indicating a connection between the cameras and the proprietor of the mark, Asahi, and to distinguish such cameras from those connected in the course of trade with any other person.

Held, further, that, on the face of it, by selling cameras bearing the mark 'Pentax', the respondent had used the trade mark for the same purpose, ie of indicating a connection between the cameras and Asahi.

Held, accordingly, that the use of the trade mark 'Pentax' by the respondent was use I as a trade mark and was thus use as referred to in s 44(1)(a) of the Trade Marks Act.

Held, further, that the expressions 'unauthorised use' and 'use as a trade mark' in s 44(1)(a) could only be properly understood in the light of the historical development of the law relating to trade marks.

Held, further, that at common law a trade mark served to indicate the origin of goods in the proprietor of the trade J mark, and infringement occurred when the trade mark had been used in respect of goods which were not those of the proprietor.

1987 (2) SA p963

Held, further, that at common law the consent of the trade mark A proprietor was a good defence to an action for infringement, and the legislation preceding the patent, Designs, Trade Marks and Copyright Act 9 of 1916 had taken this for granted, making no specific provision for it.

Held, further, that when the concept of 'registered user' had been introduced into the 1916 Act, 'permitted use', being use by a registered user, was excluded from conduct which would otherwise have constituted infringement: consent remained a B good defence to an action for infringement.

Held, further, that, while the 1916 Act and subsequent legislation had extended and refined the definition of infringement, such legislation had done nothing to change the main characteristics of trade marks at common law.

Held, further, that there was nothing in the common law, or in the legislation, to suggest that the proprietor of a trade mark was entitled, by virtue of trade mark law, to control the sale or distribution of his goods which he had marked with his trade C mark.

Held, accordingly, that it appeared that the word 'unauthorised' in s 44(1)(a) did no more than express a well-established rule of law, viz that the Proprietor of a registered trade mark had the right to prevent others from selling goods which, while not his, were marked with his trade mark.

Held, further, that the expression 'use as a trade mark' in s 44(1)(a) had a well established meaning in the context of infringement, in view of the historical background to the D legislation, viz that the expression should be interpreted to connote use only in respect of goods other than what have been called 'genuine' goods.

Held, further, that, since the goods which the respondent had sold had been genuine Asahi products, properly marked with the 'Pentax' trade mark by or on behalf of Asahi, there had been no infringement since the respondent's conduct had not been covered by s 44(1)(a). Appeal dismissed.

Champagne Heidsieck et Cie Monopole Societe Anonyme v Buxton E [1930] 1 Ch 330 applied.

The decision in Hampo Systems (Pty) v Audiolens (Cape) (Pty) Ltd 1985 (4) SA 257 (C) confirmed.

Case Information

Appeal from a decision in the Cape provincial Division (Schock F J). The facts appear from the judgment of Grosskopf JA.

C Plewman SC (with him C E Puckrin SC) for the appellant: Although appellant is an authorised distributor and not a registered user in respect of the trade mark 'Pentax', the appellant has a legal right to enjoy and achieve the trading benefit or advantage of the goodwill subsisting in the mark G Pentax in return for the obligations undertaken under the distribution agreement. Cf Prok Africa and Another v N T H (Pty) Ltd 1980 (3) SA 687 (W); Atlas Organic Fertilizers (Pty) Ltd v Pikkewn Ghwano (Pty) Ltd and Others 1981 (2) SA 173 (T). The respondent is misrepresenting to the public that the appellant will honour a guarantee in respect of the product sold by it (the respondent) and is thereby passing-off its business as being connected in the course of trade with the H business of the appellant; and the respondent is unlawfully competing with the appellant by infringing Asahi's trade mark 'Pentax'. While the respondent is not passing-off its product or its business as that of the appellant, it is nonetheless misrepresenting to the public that there is a connection in the course of trade between its business and that of the appellant I in that the public are being led to believe that products sold by the respondent will be repaired under a warranty which the appellant will honour. The facts show that the respondent, far from indicating to its customers that it has no connection with the appellant, in fact expressly suggests that the appellant will honour any warranty claims in respect of the equipment J which it (the respondent) sells.

1987 (2) SA p964

A The basic requirements of the delict of passing-off are a misrepresentation and consequent damage or the likelihood of damage to the plaintiff's goodwill. H P Bulmer Ltd v J Bollinger SA 1978 RPC 79 at 99 line 12; and Erven Warnink BV v J Townsend and Sons (Hull) Ltd (1979) FSR 397 at 405. In the latter case it was stated that five characteristics had to be B present in order to create a valid cause of action for passing-off: (i) a misrepresentation; (ii) made by a trader in the course of trade; (iii) to prospective customers of his or ultimate consumers of the goods or services supplied by him; (iv) which is calculated to injure the business or goodwill of another trader (in...