Arbormasters Pty Ltd v Arbormaster Training Inc

[2007] ATMO 7

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:Opposition by Arbormasters Pty Ltd to registration of trade mark application 935211(18)(41) Arbormaster proceeding in the name of ArborMaster Training, Inc

Delegate:	Iain Thompson
Representation:	Opponent Susan Gatford of Counsel instructed by Macpherson & Kelly Applicant Julia Baird of Counsel instructed by Griffith Hack
Decision:	Section 52 opposition, grounds under subparagraph 42(b), section 44, section 58, section 60, subparagraph 62(b). Opposition established under subparagraph 62(b), opposition under sections 44 and 58 also established. Costs ordered against applicant.

Background

1. ArborMaster Training, Inc, ('the applicants'), a Massachusetts corporation of Willington, Connecticut, has filed an application to register a trade mark, current details of which are:

   App No:  935211
   Filing Date:  22 November 2002

   Services:Class: 18:  Equipment for climbing trees including tree saddles

   Class: 41Providing of training, practical demonstration services, including training and practical demonstration services for arborists

   Trade Mark:  ARBORMASTER
   Endorsement:  Provisions of subsection 44(4) applied.

   (Subsection 44(4) provides for the acceptance of a trade mark application in the face of an earlier application or registration with which it conflicts on the basis of evidence of prior continuous user).

2. On 25 January 2005, Arbormasters Pty Ltd, ('the opponent') of Ringwood, Victoria, filed Notice of Opposition (‘the Notice’) to the registration of the trade mark.  The Notice cites most of the available grounds under the Trade Marks Act 1995 (‘the Act’).

3. Evidence in support and evidence in answer, the opponent’s evidence in reply, and further evidence of the parties was served and filed in accordance with the Act and Regulations thereto.

4. As a delegate of the Registrar of Trade Marks, I heard the arguments of the parties at a hearing in Canberra on 11 December 2006.  Ms Susan Gatford of Counsel instructed by Macpherson & Kelly represented the opponent and Ms Julia Baird of Counsel instructed by Griffith Hack represented the applicant.

   Evidence

5. The evidence comprises the following statutory declarations:

Declarant	Known As Position	Date Made	Exhibits
Evidence in Support
John Cobbett	‘Cobbett’ MD of opponent	19 April 2005	JC1 to JC29
Evidence in Answer
Kenneth M Palmer	‘Palmer’ President & CEO of opponent	28 September 2005	KMP-1 to KMP-16
Evidence in Reply
John Cobbett	‘Cobbett 2’ As above	21 December 2005	JC1 to JC4
Applicant’s Further Evidence
Kenneth M Palmer	‘Palmer 2’ As above	22 April 2006	KMP-1 to KMP-18
Opponent’s Further Evidence
John Cobbett	‘Cobbett 3’ As above	13 June 2006	JC1 to JC2
Siegfried Werner	‘Werner’	13 June 2006

The subsection 44(4) evidence

1. The convenient start point for a discussion of the evidence is the evidence provided to the examiner by the applicant to establish prior continuous user of the opposed trade mark. This evidence is the basis of the grounds of opposition in terms of subparagraph 62(b) and (with the other evidence) goes to 44(4). Much of the evidence that relates to these two grounds also relates to the ground under section 58.

2. The opponent’s registration cited as a ground for rejection by the examiner (and accepted here by both parties as conflicting with this application in terms of subsections 44(1) and 44(2) of the Act) is (with irrelevant classes of goods or services omitted:

   Reg No:  822645
   Priority Date:               8 February 2000

   Goods/Services:          
   Class: 18  Tree climbing equipment including saddles, gaff climbers, positioning straps, belts, harness fittings, harness straps,and harness traces, backpacks, gags, key rings, leather goods, saddle cloths, saddle trees, satchels, kit bags for climbers.
   Class: 41  Training and education services

   Trade Mark:                ARBORMASTER

3. The declaration (‘the section 44(4) declaration’) put in as evidence by the applicant of prior continuous use to the examiner is by Kenneth M Palmer who is President and CEO of the applicant.  He refers to the goods and services of the application and defines them as the “Goods and Services” and also defines the trade mark as the word ARBORMASTER as applied for, then states that:

   “The lodgement date of the cited registration is 8 February 2000.

   The Applicant’s Goods were made available in Australia by an authorised distributor who commenced distributing catalogues and the Goods in Australia as early as August 1996.  The applicant’s authorised distributor commenced distributing catalogues in which the ARBORMASTER trade mark appeared and distributing the Goods in Class 18 as early as October 1997.  The Applicant’s authorised distributor was distributing catalogues and selling the Goods in Class 18 of the application in Australia using the Trade Mark directly in connection with the Goods at least as early as February 1999.  The Respondent [the opponent] was a sub-distributor of the Applicant’s authorised distributor from 1996 through to at least the end of 1999” [Parenthetical material added]

4. I will state now that the precise import of the above paragraph eludes me.  The declaration appears to give three dates (1996, 1997, and 1999) as being potential start dates for the use of its ARBORMASTER trade mark on goods.  It could be that the declarant means to say that catalogues in which the goods appear were distributed in Australia in 1996 but the goods were not sold in Australia at that time.  As there is no reference to Australia in the second sentence, it could be that the authorized distributor only commenced distributing both catalogues and the goods in 1997, but not to Australia.  The leaves the third sentence as being the first authoritative claim to use of the applied-for trade mark on potentially relevant goods in Australia in February 1999.

5. I note too that the last sentence of the paragraph quoted above carries a strong allegation of a lack of good faith on the part of the opponent.

6. The declaration goes on to say:

   I am also responsible for presenting educational seminars and hands-on training modules, being services in Class 41 covered by the application for the Trade Mark in Australia under or by reference to the Trade Mark for:

   a)The Tree Doctor, Brisbane, Queensland, on 1, 2, 3, 4 and 5 December 1997 (hands on training modules).

   b)The Tree Doctor, Sydney, New South Wales, on 10, 11, 12, & 13 December 1997 (hands-on training modules); and,

   c)the first National Conference of the International Society of Arboriculture on 12 to 15 November 1998 (seminar)

   d)Rip Tomkins, Vice President and Co-owner of ArborMaster Training, Inc conducted training, hosted by the Tree Doctor, Brisbane, Queensland November 1998 (hands-on training modules);

   e)Rip Tomkins, Vice President and Co-owner of ArborMaster Training, Inc presented an educational seminar and also oversaw the ITCC Climbing Competition at the 2^nd Annual National Conference of the International Society of Arboriculture, Sydney, Australia, October 1999.

7. There is no supporting material appended to the section 44(4) declaration. However, the opposition stands or falls on the extent to which the applicant’s evidence before me supports its statements which led to the acceptance of the application for registration.

   The Opponent’s History

8. The opponent has a related or associated company, New Age Arbor Products Pty Ltd, (‘NAAP’) which, as correspondence in evidence from attorneys acting for the applicant observes, has the same company officers and address as does the opponent.

9. In 1992, the opponent’s associated company NAAP purchased, inter alia, assets of a bankrupt company from JAV Australia Corporation Pty Ltd (‘JAVAC’) who were the liquidators.  The bankrupt company was called Arbormasters Australia Pty Ltd (‘AAP’) (incorporated in 1988 under the name Terralift Australasia Pty Ltd) and the business name registration 1060366S ARBORMASTERS was registered by the liquidator.  The contract, dated 7 November 1992, is a proforma Law Institute of Victoria document with hand written ‘Z’ deletions and other hand written additions and, as far as it relates to these proceedings, is couched in the following terms:

   The Vendor sells and the Purchaser buys the stock as inspected and the other assets referred to herein for

   (a)the price

   and upon the terms and conditions of the Contract as contained in the attached –

   Particulars of Sale;                 and

   General Conditions;               and

   Special Conditions and Schedules (if any).

10. The contract was executed by someone whose signature appears to be that of John Cobbett (Managing Director of the opponent) and Vince Amato, who was presumably acting on behalf of the liquidator as his signature appears on other documents in this capacity.  Consideration in the contract was a deposit of $2000 and a promise to pay an unspecified balance.

11. The contract goes on to specify General Conditions:

    Until the possession date [9 November 1992] the assets hereby sold shall be at the risk of the Vendor.  The chattels sold shall be delivered to the Purchaser on the possession date in the same state of repair as at the date hereof fair wear and tear excepted and where applicable in proper working order unless otherwise specified herein.

    The assets hereby sold do not include the debts of the business owing to the Vendor at the possession date.

    Any provision of this Contract remaining to be performed or capable of having effect after the possession date remains in full force and effect.

    Unless otherwise agreed in writing between the parties the deposit moneys paid hereunder shall be held by the person receiving those moneys as a stakeholder in accordance with the provisions of Division 3 of Part 1 of the Sale of Land Act 1962, save that section 27 of the said provision shall not apply, mutatis mutandis.

    The General Provisions shall be read subject to any Special Conditions and to any provisions in any schedule to this Contract.

    Special Conditions

    The Vendor warrants to the Purchaser that the Vendor is the proprietor of the business name, the stock and other assets sold pursuant to the Contract and in consideration of the payment to the Vendor of the purchase price, the Vendor hereby indemnifies and shall save harmless the Purchaser from and against all loss, damage, expenses or costs whatsoever or howsoever arising out of or in connection with the Vendor failing to pass to the Purchaser ownership or good title of the business name, the stock or the other assets.

    The Vendor makes no warranty in relation to the company files.

    Other than a warranty and representation that the Vendor [is] entitled to ownership of the Company files of Arbormasters Australia Pty Ltd and is therefore in a position to sell those files to the purchaser,  In consideration of the payment by the Purchaser to the Vendor of the purchase price the Vendor hereby indemnifies and saves harmless and shall keep indemnified and shall save harmless the Purchaser from and against all claims, suits, demands, actions, loss or damage, costs or [illegible] in connection with any claims by any third person made against the Purchaser in relation to the ownership or possession of the company files of Arbormasters Australia Pty Ltd in the possession of the vendor as at the date of sale.

    The purchaser buys the stock as inspected at the premises at 163-167 Eley Road, Blackburn South.

    The purchaser shall not be required to effect settlement and pay the residue of the purchase price until the purchaser is satisfied that that the vendor is the registered proprietor of the business name and that telecom [sic] will, subject to the payment of any necessary fee, transfer or redirect the phone number of the business from the vendor to the purchaser.

    Schedule other Assets

    1.Chain Saw

    Stihl 026

    2.Chain Saw

    Echo Little Champ

    3.The files of Arbormasters Australia Pty Ltd in Liquidation in the possession of the vendor as at the date of the sale.

    (a)     The Vendor agrees to sell and the Purchaser agrees to buy the marketable stock of the business on the date of this contract and the vendor acknowledges that the price for the stock is included in the purchase price.

    The Vendor shall execute all documents (to be prepared by the Purchaser) and do all things necessary for the Purchaser to apply for and obtain the transfer to him of –

    (a)any business name relating to the business

    (b)all licenses, quotas, franchises, and other like rights relating to the business including any specified herein;

    (c)subject to the approval of Telecom any telephone facsimile or telex service for the business

    (d)all permits and registrations necessary to enable the Purchaser to carry on the business lawfully including any specified herein;

    and shall hand these documents to the Purchaser on the possession date.

    [matter within the square parentheses, above, is either illegible or inferred]

12. Other documents in evidence which accompany the contract are a letter from Mr Amato acknowledging the deposit of $2000; a receipt from Corporate Affairs Victoria concerning a business name registered under 1060366S (Arbormasters) by Mr Amato; a letter from Mr Amato on JAVAC letterhead to Telecom requesting diversion of phone calls to the opponent’s associated business NAAP at 25/200 Canterbury Rd, Bayswater; a letter from the bankrupt AAP to the Superintendent of Parks & Gardens; a 1991 AAP pricelist in which are included ‘Arbormaster’ Harnesses; and, an AAP ‘flier’ (at the head of which the trade mark arbormasters prominently appears) which promotes, inter alia, ‘climbing and ancillary gear’, ‘cable and bracing supplies’, ‘safety gear’ and ‘safety footwear’.

13. The above trade mark use must necessarily have been before 1992 when AAP became bankrupt.

    The Applicant’s History

14. The applicant states that a distributor called Buckingham has a license to distribute goods under the applicant’s trade mark in Australia.  It is clear that for some two or three years before 8 February 2000, the opponent sold Buckingham products and distributed Buckingham catalogues containing the applicant’s ARBORMASTER trade mark.  The Buckingham product line is relatively extensive, being goods for arborists, and occupies at least 22 A4 pages.  I only have extracts from catalogues in the evidence but, as far as I can ascertain, the majority of the relevant products within the catalogue carry the Buckingham brand.  

15. The applicant’s claims to have used the trade mark on the nominated goods in Australia appear to stem from the use of the applicant’s trade mark in these Buckingham catalogues that circulated in Australia during 1997, 1998 and 1999.  At the hearing, a great deal of time was spent considering these brochures or catalogues.  However, this distracts from what Mr Kenneth Palmer, CEO of the applicant, says about these brochures in his declaration in answer:

    As noted in Paragraph 15, above, the Applicant’s Trade Mark was first used in Australia in relation to the Goods and Services during October 1997 and December 1997 respectively.  The Applicant’s Trade Mark was used in catalogues in which the Goods were offered for sale in Australia by Buckingham via its agents and distributors.  Buckingham also distributes the Applicant’s Goods under the Trade Mark in the USA, Canada, France, Germany, Italy, UK, Netherlands and New Zealand.

    […]

    Attached and marked “Annexure KMP-9” is a copy of four pages including the cover page of the October 1997 catalogue of Buckingham which was made available to [the opponent’s associated company] in Australia and which allowed the purchase of Goods including in particular the training videos referred to on Page 2 of the catalogue by the consumer public.

16. Having read the above carefully, I would conclude that the only goods which the applicant might have sold bearing the trade mark ARBORMASTER prior to 8 February 2000 in Australia is an instructional video.  These paragraphs, which are pivotal to the applicant’s claims of prior use, appear to me to be based upon a misapprehension that the mere appearance of a trade mark in an advertisement in a magazine or catalogue in Australia will constitute use of that trade mark.  In the first paragraph above, the claim that the opponent’s trade mark was used in catalogues is in the past tense and is immediately followed by a change to the present tense and a statement that the goods are also distributed to certain other countries around the world.  I read this literally as meaning that for some time previously the trade mark only appeared in the Buckingham catalogues and now the trade mark appears on goods which are presently in these other countries but not necessarily in Australia.  Read carefully, there is no express claim to have distributed or sold the relevant goods under the trade mark in Australia at any time.  The applicant’s goods and trade mark were seemingly only in Buckingham’s American catalogues which were in Australia to support such of the Buckingham range which was sold in Australia and there is no evidence of attempts (other than the catalogues) to market the goods sold under the applicant’s trade mark.  This is a considerable step back from the statement in the subsection 44(4) declaration that, “The Applicant’s authorised distributor was distributing catalogues and selling the Goods in Class 18 of the application in Australia using the Trade Mark directly in connection with the Goods at least as early as February 1999.”

17. Later in the declaration, Mr Palmer states:

    I confirm that the catalogues referred in paragraphs 20, 21 and 22 were available in Australia from which the Applicant’s goods under the applicant’s trade mark could be purchased through the applicant’s local distributor.  Presently, the applicant’s goods are made available in Australia by Buckingham’s distributors …

18. Again, read carefully, there is no express claim (or support for any earlier claim) to have sold goods under the opposed trade mark in Australia prior to 8 February 2000 or to have used the trade mark continuously on goods within Australia.  The only claims that I can find within the applicant’s evidence in answer and further evidence is that its trade mark appeared in Buckingham catalogues and that, accordingly, the goods could have been ordered from within Australia.  There is no claim, or supporting evidence, to give weight to the proposition that the goods were so ordered.

19. I would conclude that the applicant has assumed that the appearance of its trade mark within the Buckingham catalogues in Australia constitutes a use of its trade mark on goods in Australia.

20. The applicant also provides a copy of an executed letter of offer relating to the training services it performed within Australia before 8 February 2000.  These training services were performed by officers of the applicant prior to the filing of the opponent’s trade mark registration 822645, which includes, inter alia, training and practical demonstration services for arborists.  The opponent’s trade mark appears on the letterhead as below and there is no other reference to the trade mark as it appears on the application form in this documentation:

21. There is other evidence that I will discuss as is necessary in the course of my decision.

    Submissions

22. The submissions of counsel focused on whether the evidence of the parties is sufficient to establish ownership, and if it does, who is the owner of the trade mark. Other argument concerned the statements or representations made to the examiner which led to the acceptance of the opposed trade mark for possible registration. There were other arguments which were made in relation to the other grounds under subparagraph 42(b) and section 60 – however, in my consideration, the opposition is quite clearly established under both sections 58 and 44 and also subparagraph 62(b) and, rather than inflict the death of one thousand cuts on the application, I will give my reasons for finding that the opposition has been established under section 58 and subparagraph 62(b) and consequently subsection 44(4).

    Discussion

    Section 58

1. Section 58 of the Act provides:

   58  Applicant not owner of trade mark

   The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

   Note:For applicant see section 6.

2. In order to establish its opposition under section 58 of the Act, an opponent must show that:

   ·    the respective trade marks of applicant and opponent be either identical or substantially identical (Carnival Cruise Lines Inc. v Sitmar Cruises Limited (1994) 31 IPR 375, (1994) AIPC ¶91-049, (1994) 120 ALR 495), and,

   ·    the  respective goods or services of the parties be the ‘same kind of thing’ (Re:Hicks’s Trade Mark (1897) 22 VLR 636, 3 ALR 75), and,

   ·    a person other than the applicant has the earlier claim to ownership based on use prior to both the present application to register and actual use of the trade mark by the applicant (Settef SpA v Riv-Oland Marble Co (Vic.) Pty Limited 10 IPR 402 at 413 and Re:Hicks’s Trade Mark, above, at 639).

3. The parties agree that the trade mark are the same trade marks and the relevant goods and services involved are the same kind of thing.  The questions resolve themselves to these: did anyone use the trade mark in Australia before the priority date (8 February 2000) of the registration of the trade mark by the opponent.  Moreover, if anyone did use the trade mark before this date, who was first to use it?

4. I will discuss the applicant’s claims to the ownership of the trade mark first.

5. The applicant’s claims to first use in relation to the services for which it seeks registration relate to training courses it ran in Australia before 8 February 2000. Section 7 of the Act provides:

   7  Use of trade mark

   (1)If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.

   Note:For prescribed court see section 190.

6. The trade mark the use of which the applicant relies on to establish its ownership of the trade mark prior to 8 February 2000 is the graphical representation of a man in a tree with the word ‘ArborMaster’ imposed over the leaves of the tree and the words ‘Training Inc’ appearing under it.  This trade mark (a representation of which is at paragraph 26, above) appears in the executed letter of offer to conduct training courses in Australia.  The word trade mark does not appear in this correspondence, although the company name, Abormaster Training, Inc, does.  This is, of course, use of a company name rather than of a trade mark.

7. In terms of subsection 7(1), the addition of the device of the man in a tree to the word trade mark ARBORMASTER are alterations which substantially affect the identity of the word trade mark. Substantial identity, which is relevant (as a minimum) in terms of section 58 (and is also contemplated by subsection 7(1) of the Act) looks to the classic side-by-side comparison of the trade marks: Windeyer J in Shell Co. (Aust) Ltd v Esso Standard Oil (Aust) Ltd, (1961) 109 CLR 407 at 414 said:

   In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.

8. The word trade mark ARBORMASTER compared with the device trade mark which incorporates the word are not substantially identical.  This use of the device trade mark, on which the applicant relies to establish ownership in relation to its services, is thus not a use of the word trade mark which it has applied to register.  The applicant accordingly cannot rely on the use of the device trade mark to establish use (and hence potential ownership) of the opposed trade mark.  Other evidence which shows that Kenneth Palmer, a principal of the applicant was present at International Arborist Conferences in Australia and that the trade mark may have occurred in conference material, is not, to my mind, of much weight in establishing the use of the trade mark.  It is not clear that this usage was for the purposes of trade.  As the conference organizers acceded to a request by the opponent to cease any use of the trade mark in relation to Mr Palmer’s activities, it appears likely that the use was not by the applicant but was informal use by the conference organisers.  The removal of the allegedly offending material from conference material might also, in the presence of any pre-existing use of the trade mark by the opponent or its associated company NAAP, be an acknowledgement of that pre-existing use.

9. The other evidence relied on by the applicant is that which is alleged to establish use of the trade mark in Australia in relation to goods.  There is no evidence that there were goods sold in Australia bearing the applicant’s trade mark before 8 February 2000.  I consider that the weight of the evidence suggests that Buckingham, the arborist equipment and supplies distributor, sold goods in Australia that were ordered by reference to its catalogue.  These goods bore the Buckingham trade mark and were sold by the opponent.  It can be safely inferred that the opponent would have seen the applicant’s trade mark and goods within the catalogues.  However, the weight of the evidence supports, in my consideration, the proposition that the catalogues are American ones which show the entire Buckingham range of goods and that a much more limited range of goods was actually immediately available within Australia.  There is no evidence that the opponent’s goods carrying its trade mark were ever amongst those goods. 

10. The presence in evidence of the opponent’s email orders from Buckingham (other than those here under consideration and not bearing the opposed trade mark) indicates that if the relevant goods bearing the opposed trade mark had been ordered from, or available and sold in Australia, it should have been simple for the applicant, when challenged concerning the ownership of the trade mark, to establish this.  The inference I would draw is that the applicant’s goods were not available within Australia, the offer of goods in the catalogue was seemingly not made to people in Australia, and there were no goods sold in Australia (or ordered by people in Australia) bearing the opposed trade mark prior to 8 February 2000.  Mr Palmer’s declarations made in relation to the opposition, carefully read, appear to confirm that no relevant goods bearing the trade mark were ordered from or sold in Australia prior to 8 February 2000.

11. The precedents such as Blackadder v Good Roads Machinery Inc (1926) 38 CLR 332, Mooregate Tobacco Co Ltd v Philips Morris Ltd (1984) 156 CLR 414 and Re Registered Trade Mark “Yanx”; Ex parte Amalgamated Tobacco Corp Ltd (1951) 82 CLR 199 dictate that there be an actual trade in the goods or services in question and that the trade might only be one item – even if the goods have been ordered but not yet arrived in Australia. The applicant has not established this and has thus not established its ownership of the trade mark in Australia before the priority date of the conflicting registration 8 February 2000.

12. I next turn to the opponent’s claims to ownership of the trade mark.

13. As I have decided that the applicant has not established ownership prior to 8 February 2000, it is not strictly necessary for me to consider whether the opponent was the owner of the trade mark prior to 8 February 2000 – its rights could be properly seen as arising from the registration of its trade mark on 8 February 2000.  However, for the sake of completeness, I note that I consider for the following reasons that the opponent (or its related company NAAP) became the owner of the trade mark ARBORMASTERS in Australia when it bought the bankrupt AAP from the liquidator in 1992.

14. The contract makes it clear that the opponent (or its associated company NAAP) did not just ‘buy a couple of chainsaws and some files’ from the liquidator, as the applicant has suggested.  The opponent, or NAAP, bought the business name which was registered by the liquidator for just that purpose.  As the bankrupt company was called Arbormasters Australia Pty Ltd, the registration of the business name was a pragmatic formalization by the liquidator of a pre-existing verity and an acknowledgement of NAAP’s desire to purchase something more than just existing stock and assets.  As well as the assets, NAAP bought the unsold stock (that is, the types of goods which are shown on the bankrupt AAP’s catalogue which includes the relevant goods such as harnesses which were trade marked ARBORMASTERS).  NAAP also bought AAP’s business files, which should have included all dealings with manufacturers and suppliers, advertisers or printers, customer lists, telephone lists, mailing lists, and invoice and receipt books.  The files also included contacts for the arborists with whom AAP had dealt and sold goods to, and to whom NAAP subsequently referred enquiring members of the public requiring tree surgery.  The liquidator transferred all telephone calls from the bankrupt AAP to the opponent’s associated company NAAP.

15. While it is not immediately clear that goodwill passed with the business, it is apparent that NAAP bought something in addition to the mere stock and assets of the bankrupt business.  By taking over the telephone number and company files, business name, advertising, stock and receipt books bearing the trade mark ARBORMASTERS, NAAP appears to me to have stepped into the shoes of the bankrupt company.  The term ‘goodwill’ is an elusive one: as observed by Pullin J in JWH Group Pty Ltd & Anor -v- Kimpura Pty Ltd & Anor [2004] WASC 39:

    The word "goodwill" is a word which is notoriously difficult to define: Hepples v Federal Commissioner of Taxation (No 2) (1992) 173 CLR 492 at 519. In its ordinary meaning, it is an intangible, saleable asset, arising from the reputation of a business and its relation with its customers, distinct from the value of its stock: see "Macquarie Dictionary". It is necessary to take care in referring to cases which deal with the meaning of the word "goodwill". This is because the context in which the case was decided may focus on the different aspects of goodwill and whether goodwill constitutes property, whether something is a source of goodwill, or whether the case was concerned with valuation issues: see Federal Commissioner of Taxation v Murry (1998) 193 CLR 605 at [12]. Having said that, it is clear that goodwill is the attractive force which brings in custom to a business. It is the one thing which distinguishes an old established business from a new business at its first start. The goodwill of a business may emanate from many different sources: see Murry's case (supra) [17] and [24]; Inland Revenue Commissioners v Muller & Co's Margarine Ltd [1901] AC 217 at 223-224.

16. Having effectively bought the business, and business name, the opponent’s associated company NAAP continued to issue receipts under the ARBORMASTERS trade mark, several examples of which are in evidence, and to deal with clients on the basis that at least a part of their business was a continuation of the AAP business.  I would conclude that goodwill (and hence the trade mark ARRBORMASTERS) passed with the business to NAAP or, if it did not, NAAP assumed the mantle of the owner of the AAP trade mark ARBORMASTERS in 1992 in good faith and was not challenged in this role.  The only person who, in 1992 or 1993, could have challenged the opponent in the role of common-law trade mark owner was the liquidator, and he appears to have signalled his consent by registering the business name in order to sell it to NAAP, and including in the sale stock that carried the trade mark, the company files, and in forwarding telephone calls to NAAP.

17. There are statements within the evidence that between 1995 and 1997 the opponent had 229 climbing harnesses manufactured for it by Sala International Pty Ltd bearing the trade mark ARBORMASTER and that a company called Vertical Pty Ltd has manufactured approximately 750 harnesses trade marked ARBORMASTER for the opponent between 1997 and 2003.  These statements are unsworn but have not been seriously challenged by the applicant and I give them due weight.

18. The opponent has also licensed a number of businesses to use the ARBORMASTER trade mark in relation to their services – a letter in evidence from Robert Knott, director of R&T Tree Services Pty Ltd confirms this and also that Mr Knott has purchased three tree climbing harnesses bearing the trade mark from the opponent since the early 1990s.

19. I would conclude that the opponent (or NAAP) was the owner of the trade mark ARBORMASTER in Australia in relation to at least tree climbing equipment, and tree removal, trimming and tree surgery services from 1992 when it (or its associated company) effectively purchased the bankrupt AAP. 

20. I would conclude that, from 1992, the opponent, or its related company NAAP, was the owner of the trade mark ARBORMASTER in Australia in relation to the relevant goods.  The situation in relation to the relevant training services is not as clear but, absent evidence which establishes either the applicant’s or the opponent’s ownership in relation to the training services before 8 February 2000 (the date of the opponent’s trade mark registration) the opponent’s ownership of the trade mark stems from at least that date.

21. In view of the above conclusions, the opponent has established its opposition in terms of section 58 of the Act for both the goods and the services nominated on the application.

    Subparagraph 62(b)

22. Subparagraph 62(b) provides:

    62  Application etc. defective etc.

    The registration of a trade mark may be opposed on any of the following grounds:

    […]

    (b)that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars.

    Note:For file see section 6.

23. The statement in the subsection 44(4) declaration on which the examiner relied in accepting the application for possible registration in relation to the applied-for goods was:

    The Applicant’s Goods were made available in Australia by an authorised distributor who commenced distributing catalogues and the Goods in Australia as early as August 1996.  The applicant’s authorised distributor commenced distributing catalogues in which the ARBORMASTER trade mark appeared and distributing the Goods in Class 18 as early as October 1997.  The Applicant’s authorised distributor was distributing catalogues and selling the Goods in Class 18 of the application in Australia using the Trade Mark directly in connection with the Goods at least as early as February 1999.  The Respondent [the opponent] was a sub-distributor of the Applicant’s authorised distributor from 1996 through to at least the end of 1999” [Parenthetical material added]

24. In view of my conclusion that the evidence in answer and further evidence of the applicant does not support the proposition that the applicant (or its distributor) sold, or took orders for, goods bearing the opposed trade mark in Australia before 8 February 2000, the above statement is false in a material particular – namely that the trade mark had been used in trade in relation to the sale of relevant goods bearing trade mark in Australia before the priority date of 8 February 2000.  The examiner accepted the application for possible registration relying on the verity of this claim.

25. The statement would also lead an examiner to conclude that not only had the applicant’s goods been sold in Australia bearing the trade mark but also infers that they had been sold by the owner of the conflicting trade mark.  While the statement that, “The Respondent [the opponent] was a sub-distributor of the Applicant’s authorised distributor from 1996 through to at least the end of 1999,” is true, its juxtaposition with the sentence immediately before it, “The Applicant’s authorised distributor was distributing catalogues and selling the Goods in Class 18 of the application in Australia using the Trade Mark directly in connection with the Goods at least as early as February 1999,” would have led the examiner to conclude that the owner of the cited trade mark had sold the applicant’s goods bearing the trade mark before the date of the cited registration.  This conclusion on the part of the examiner would have led to a predisposition to accept the application for possible registration.

26. Additionally, the examiner would have concluded that the owner of the conflicting trade mark had acted in bad faith in securing registration of the conflicting trade mark.  This conclusion would have also predisposed the examiner to accepting the application for possible registration.

27. Each of the above conclusions is as the result of a statement or representation which is false in a material particular on which the examiner would have relied in accepting the application for possible registration. 

28. In view of my conclusion concerning the applicant’s lack of use of the word trade mark ARBORMASTER in relation to the services ‘Providing of training, practical demonstration services, including training and practical demonstration services for arborists’, the applicant’s claim that it had used the word trade mark ARBORMASTER (rather than its device trade mark) is (on the evidence before me) false in a material particular and the examiner accepted the application to register the trade mark for the services in reliance on the verity of the statement.

29. The opponent has therefore established its grounds under subparagraph 62(b).

    Section 44

30. It naturally flows from my conclusions in relation to section 58 and subparagraph 62(b) that the opponent has also established its opposition under section 44 of the Act. The evidence does not establish any prior continuous use of the opposed trade mark in terms of subsection 44(4) by the applicant before 8 February 2000.

    Decision

31. Section 55 of the Act provides:

    55. Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

    (a) to refuse to register the trade mark; or
    (b) to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

    having regard to the extent (if any) to which any ground on which the application was opposed has been established.

    Note:  For limitations see section 6.

32. As the opponent has established its grounds under sections 44, 58 and 62, I refuse to register application 935211.

    Costs

33. The opponent is entitled to its costs in relation to this matter and I order costs against the applicant at the official scale.

    Iain Thompson
    Hearing Officer
    Trade Marks Hearings
    05 February 2007