Australian Lumber Company Pty Ltd v Borello, P

IN THE FEDERAL COURT OF AUSTRALIA

) )

WESTERN A~JSTRALIA DISTRICT REGISTRY )

No. WA G 46 of 1987

)

GENERAL DIVISION

)

BETWEEN:

AUSTRALIAN

LUMBER CO. FTY.

LTD. tradins as W.A. Salvaqe

Applicant

AND:	PETER BORELLO

Respondent

MINUTE OF ORDER

JUDGE MAKING ORDER	: Neaves J.
DATE OF ORDER	: 3 July 1987
WHERE MADE	: Canberra
THE COURT ORDERS THAT:

1. The motion for interlocutory relief be dismissed.

2. The

applicant pay the

respondent's

costs

of the

motion.

IN THE FEDERAL COURT OF AUSTRALIA	) )
WESTERN AUSTRALIA DISTRICT REGISTRY	) No. WA G 46 of 1987
)
GENERAL DIVISION	)

BETWEEN:

AUSTRALIAN

LUMBER

CO.

PTY.

LTD. tradlnq as W.A.

Salvaqe

Applicant

AND :

P E E R

BORELLO

Respondent

W: Neaves J.

m:	3 July 1987

REASONS FOR JUDGMENT

Australlan Lumber Co. Pty. Ltd.

("the applicant") has

applied to the Court by motlon for

an interlocutory m~unctlon

pending the hearing of the substantive applicatlon referred to

below restraining Peter Borello

("the respondent") from -

"(a)

Causlng or procurlng the broadcastlng or

dissemination on television in Perth of

advertisements depicting the character

'Luigi

Sava Da Money' as shown

Annexure 'A' to the Affldavlt of Joseph Boros dated 21 April 1987 or a colourable imltation thereof In breach

of the provisions of Sections 52 and 53(d) read with Section 6(3)(a) and (b)

the

Trade

Practices

Act

1974

\Commonwealth);

(b)	Committlng any other acts of misleadlng or deceptlve conduct or acts amountlng

to 'passing off' whereby the publlc or

members of the public are induced or led to belleve that there 1s any connection between the buslness of the Appllcant

conducted at its various branches In

2 .

Perth and that of the Respondent conducted by the Respondent under the name of 'Buccaneer Pools and Patlos' at Belmont by reason of the use by the Respondent of the character 'Lulgl Sava

Ea Money' o r a

colourable

imltatlon

thereof In television advertisements;

(c)

Committing any acts of infrinqement of the Applicant's copyrlght in the plcture of the character 'Lulgl' as deplcted in

Annexure ' A ' aforesald

in breach of the

provlslons of the Copyrlqht Act 1968

(Commonwealth)

" .

The substantlve appllcatlon filed on behalf of the

applicant seeks

a permanent in~unction

in similar terms as

well as damages and costs.

As the respondent is

not

a corporatlon, the

applicant relles on the xtended operation glven to Division 1 of Part V, whlch Includes 55.52 and 5 3 ( d ) , of the Trade Practlces Act 1974 (Cth) ("the Trade Practices Act")

by s.6(3) thereof.	The latter sub-section provides, so far
as relevant:

" ( 3 )

In addition to

the effect that thls

Act, other than Part X, has as provlded by sub-section ( 2 ) , Divislon 1 of Part V has, by force of this sub-section, the effect It would

that Division (other than section

55)

were, by express provision, confined in its operation to engaging in conduct to

the extent to which the conduct lnvolves the use of postal, telegraphlc or

telephonic servlces o r

takes place in a

radio or television broadcast;

....

reference in

that Divlslon to a

corporatlon included a reference to a

person not belng a corporation."

support

the

motlon

for

an lnterlocutory

ln]unctlon

the

applicant

relies

on the

three

several

affldavits of Joseph

Boros, the managlng dlrector of the

appllcant, sworn on

April 1987, 7

May 1987 and 19 May

1987 respectlvely, the affidavlt

of Davld Cornellus Johns

sworn on

13 Aprll 1987 and the affidavlt of Llndsay Allan

Cary sworn on

21 April 1987.

In opposltlon to the motion

the respondent relies upon hls

own affldavlt sworn on 13 May

1987, the affldavlt of Dlana Denise

Neman sworn on

8 May

1987 and the affidavit of Lee Russell Smith sworn on	14 May
1987.

Certaln paragraphs of

Mr Boros’ affldavlt sworn 21

April 1987 were objected to and

re~ected.

None of the

deponents

was

cross-examined.

For the

purposes

this

application, I

accept that the facts are as

stated in the

affidavits and the annexures thereto except, of course, the

paragraphs of

Mr Boros’ affidavlt that were not admitted

into

evidence.

I have

vlewed

several

examples

of the

applicant‘s advertising materlal as broadcast	on televlsion
and the advertisement used by the respondent	which is the
subject of this application.

The respondent, who is

of Italian descent, 1s the

sole proprletor of

a business carrled on at Belmont in the

State of Western Australia under the name “Buccaneer

Pools”.

The nature of the business

1s descrlbed as the deslgn,

construction and installation of flbreglass swimming pools.

' .

4 .

Seven distinctive designs

are marketed.

Such swimming pools

sell for a base price of

approximately $8,000.

In additlon

to selling fibreglass swimming pools from its showroom at

Belmont,

Buccaneer

Pools

also

sells pool accessories

mcludlng

chlorlnators. hoslng, test klts and leafscoops.

These accessorles are sold as

a servlce to customers of

Buccaneer Pools whlch does not conduct

a servlce department

for the publlc and	does not have a	separate retail area at
Its showroom.

Buccaneer Pools commenced

advertlse

television in

1976. From the outset the respondent wrote

the scripts for the advertisements and personally appeared

in them.

He also used the services of a presenter, Mr J.K.

Watts, whose task was to present the bulk of the script	of
each advertisement.

In late 1986 the respondent caused to be made the advertisement of which the

applicant

complains.

The

advertisement is

for what is described as a do-it-yourself

turbo tub swimmlng pool.

It opens with an overall view of

the factory yard containing a number of fibreglass swimming pool shells and two vehicles bearing the name "Buccaneer".

Standing in the swimming pool shell nearest

the

camera is

the presenter

of the advertisement, Mr

Watts, dressed in a

sult. Standlng beside him is

the respondent dressed in

dark blue slnglet and pale blue trousers

with

a knotted

white handkerchief on

his head. He wears a chain around hls

neck with

a large medallion at the front.

Watts then

5 .

advertises the pool kit consisting of the pool shell, a

filter and pump at the price of $4,000 emphasising that the

offer is only open at Buccaneer Pools.

He introduces "my

mate Peter Borello" as

the person who will show a purchaser

how easy it is to assemble the various components. Mr Borello emphasises how easy that task is, leaning forward towards the camera as he does so as if to emphasise his words. His comments are followed by laughter presumably not

at the content of what he

says but

at hls manner of

delivery. The scene then moves

into the showroom of the

factory and features

installed turbo-tub swimming

pool

filled with water which is being agitated.

At the rear of

the pool Mr Watts and the respondent are

standing. Mr Watts

again advertises the

product following which the respondent

gestures and uses

the

words "Come

to Belmont and sava da

money". His performance is again followed by laughter - in fact somewhat prolonged laughter. The name Buccaneer Pools is prominently displayed during the advertisement. The name "Luigi" is not mentioned. The respondent has described the

words

spoken

by him in the advertisement

Australian/Italian slang.

The	applicant is one of a group of companies

generally known as the Alco Group.

It carries on business

under the name "W.A. Salvage"

Leederville,

Balcarra,

Cannington,

Midland

and

Spearwood,

all within

the

metropolitan area of Perth. It sells a great variety of

goods.

It has an annual turnover of approximately $10m.

6 .

The general nature of its business appears from the

following extract

from a brochure, being an annexure to Mr

Boros‘ affidavit	sworn 21 April 1987, put	out	by	the
applicant:

“W.A. Salvage operates from five warehouse style

stores in

the Perth metropolitan area, catering

for

the

price

conscious

home

owners

and

the

bottom end of the do-it-yourself market. Their

basic range of merchandise is timber and building

materials drawn from new

downgraded

and

manufacturers

surplus

stock.

They

have

extensive range of secondhand goods which are

taken from their demolition

sites.

W.A. Salvage also sells a wide range of general merchandise which includes paint, giftware, toys, footware and camping gear, which are obtained at Auctions or imported from interstate or overseas.

W.A. Salvage are quipped to purchase and

efficiently

retail any products which can be

obtained in volume and

lend themselves to

self

service warehouse retailing.“

The diversity of products sold is well illustrated by the newspaper advertisements in evidence. They include dressed

timber, chipboard, roof

and wall sheets, fertiliser, paint,

barbecues, combination locks, cake

pans,

Christmas

tree

lights, children’s swings,

ceramic ornaments, baseball sets

and shadecloth. The emphasis is clearly on cheap prices. Some of the goods sold are referred to as “opportunity lines“, an expression explained to mean goods which it is

able to purchase cheaply and sell at what would be a discounted value relative to other retail outlets.

It is clear on the evidence that the respondent

carries on an entirely different kind of business from that

I I ...a*

. .

carried on by the applicant. There is at the present time no overlap in their respective fields of business activity and there is nothing in the evidence to suggest that this will change in the foreseeable future. There is, in fact, no association or connection between the two businesses.

Mr Boros states in his affidavit that the applicant

has a wide

and

well

known

reputation

throughout

the

metropolitan area of Perth.

He does not elaborate upon the

nature of that reputation, the reader being left to draw his own conclusions from the information provided as to the type of business in fact carried on. Notwithstanding the paucity of material, I am prepared to accept, for the purpose of considering the present application, that the applicant has a significant local reputation in respect of the business which it carries on.

Mr Boros says that

the applicant in or about 1976

desired to improve the format of its advertising by making

use of an emblem

or character which would depict the nature

of the business and

also identify the market aimed

at. At

that time, he says, the market aimed at was mainly the

"price

conscious

lower

end of the

building

materials

market".

advertising agency was commissioned to prepare

an appropriate character or emblem.

Mr Boros says that, in

consequence of their efforts, the

applicant

adopted

character

called

"Luigi Sava-da-Money". What was submitted

by the advertising agency was, in fact, a photograph of the upper part of the body of an actor dressed in a singlet and

8 .

with his hair covered by a knotted handkerchief. He has a very prominent moustache. The photograph shows the right arm bent at the elbow so that the actor's hand is at the same level as his mouth with his fingers, other than his

index finger, extended upwards.

The index finger is bent

downwards to touch the thumb and so depict a circle.

ACKOSS

the left upper part of the singlet are the words, in script,

"Luigi Sava-da-Money". Mr BOKOS says that the character has

since 1976 been used extensively by the applicant in the

conduct of its business. He

further

states

that, by

agreement between the applicant and the advertising agency,

copyright "in the picture of	the character" vested	in the
applicant.

Three examples of the applicant's advertisements as

appearing in Perth newspapers are in evidence. Two of them

contain a KepKOdUCtiOn

of the photograph much reduced in

size.

"WO of

them, including one in which the reproduction

of the photograph

appears, contain line drawings evidently

intended to represent "Luigi" . A KepKOdUCtiOn Of the photograph is also used as a trade mark on some goods sold

by the applicant. "Luigi"

is also depicted on

wall and

other

signs

the

various

business

premises

of the

applicant.

In television advertising, which is broadcast on

Channels 7 and 9

in Perth on

a regular basis,

"Luigl" is

depicted by an actor, apparently the actor who posed for the

photograph already mentioned.

He has a swarthy appearance.

He is dressed in a singlet, shorts, socks and boots

and has

his hair covered by a knotted handkerchief. The colour of his clothes is predominently dark blue though the shade of

blue varies from

advertlsement to advertisement. Sometimes

the handkerchief is white, sometimes blue. On occasions it is replaced by other headgear. Sometimes the singlet bears advertising material on both front and back. Each

advertisement advertises a particular product

or particular

products with prominence being given to the

applicant's

business name.

Repetition is a feature of the

advertisements, "Luigi"

being

depicted

character

constantly on the move, speaking almost incessantly, usually

in a raised voice, and emphasising what he says

by extensive

use of hand and arm movements.

His speech is apparently

intended

to convey the Australian idiom

with an

Italian

accent and

flavour.

He repeats

over and over again the

message that the goods sold by the applicant are very

cheap,

the words mainly used being

"We're not fancy .... but we're

cheap".

The slogan "Luigi Sava-da-Money"

is not a dominant

feature of the advertisements viewed by the Court.

In a

number of those advertisements, however, "Luigi" introduces

himself as "Luigi

from W.A. Salvage"

and

exhorts

his

audience to "Cuma to

W.A. Salvage where you

sava-da-money".

In the various forms

advertising the Character

is used both with and without the name "Luigi" and with and without the words "Sava-da-Money". It is asserted that the

character "has become an integral

part of the get-up and

image of the business of W.A. Salvage and is very well known

10.

as part

of the business and as depicting and representing

the

business and its goods in

Perth due to the

long and

extensive use thereof" in the manner shortly referred to

above. It is said that in the past ten years a total of

approximately $1.6m has been expended by the applicant on

advertising, most of that advertising	incorporating	the
"Luigi" character.

Hr Boros asserts that the applicant's customers

include builders, tradesmen

and

others

involved

in the

building industry

as well as the general

public including

handymen and "do-it-yourself" householders. He expresses the belief that many of the respondent's customers would

also be customers

of the applicant.

The applicant alleges that

has suffered damage

arising from the conduct

of the respondent but the evidence

does not make clear what is the nature of that damage. It is stated that particulars of damage will be provided prior to the trial of the proceeding. The applicant has not seen

fit to place

before

the

Court on

the

hearing

of the

application for interlocutory

relief any evidence as to the

damage it is alleged to be suffering as a result of the continued use by the respondent of the advertisement the subject of the complaint.

The

application

for

interlocutory

relief

supported

by grounds based on

s s . 5 2

and 53(d)

read with

s . 6 ( 3 ) of

the Trade Practices Act.

argument was put to

11.

the Court based on the allegation of passing off or the allegation of breach of copyright. The application is opposed by the respondent.

The applicant submits that the evidence discloses a

deliberate attempt by the respondent to seek to appropriate to his swimming pool business the applicant's good business reputation. It is said that he has done this by the adoption and use of a style of television advertising which

copies both the character "Luigi" developed by the applicant to promote its business and used by it on a regular basis over many years in such promotion and also the form of words

"Sava-da-Money"

employed

the

applicant

its

advertisements.

By the use of the advertisement in question

the respondent is said to be engaging in conduct that is misleading or deceptive or is likely to mislead or deceive,

and

therefore

contravention

of s.52 of the

Trade

Practices Act read with s.6(3) thereof, because it misrepresents to a relevant and identifiable section of the public either -

(a) that

respondent's swimming pool

business is the same business	as that
conducted by the applicant;

(b)	that there is a connection or

association between the two businesses;

given

its

imprimatur,

endorsement

or stamp of

approval

the

fibreglass

wimming

pools being marketed

by the respondent.

12.

It is further submitted that the advertisement, contrary to

s.53(d) of the Trade Practices Act read with s.6(3) thereof, represents that the respondent has a sponsorship, approval

or affilitation with the appllcant, a sponsorship, approval

or affiliation which he does not, in fact, have.

The case for the applicant turns solely on the question whether the television advertisement

would convey

to reasonable members

of the television viewing audience to

which it 1s directed any of the representations upon which the applicant relies. In accordance with authority, two issues arise. Has the applicant demonstrated that there is

a serious question

to be

tried in that regard and,

if so,

does the balance	of convenience require that	an injunction
be granted?

The advertisement the subject

of the applicant's

complaint is of short duration - of the Order of thirty seconds. I have already referred to its main features. To those features one should add that the respondent and the

actor

portraying

"Luigi"

are of similar build and

complexion. The respondent has a moustache but it is by no means as prominent as that worn by the actor.

Further, the

respondent takes a subsidiary role

in the advertisement - he

is not the

dominant

character

"Luigi"

is in the

applicant's advertisements.

The viewer of the respondent's advertisement would

have

but little opportunity

to perceive and take note

13.

much of the detail visually presented. In particular, I would not expect the ordinary reasonable viewer, even if familiar with the portrayal in the applicant ' S

advertisements of

"Luigi", to perceive

such differences as

there may be between the bodily features and dress of the "Luigi" in the applicant's advertisements. It is, I think, fair to say that the ordinary reasonable viewer would be left with the impression that there is a resemblance, even

respondent

in his advertisement

and the

actor

playlng

perhaps a striking resemblance, between the respondent

attired for

his advertisement and

the get-up of

the actor

playing

the part of "Luigi". He would also perceive

certain similarity in the

kind of language and the style

speech used by

the respondent in his advertisement and that

of "Luigi" in the applicant's advertisements. But it would not, in my opinion, go beyond that. The ordinary reasonable viewer would not believe that "Luigi" was appearing in the

respondent's advertisement.

He would, I think, regard the

respondent's appearance and speech as an imitation, more or less believable, of "Luigi" but none the less an imitation. It is of some significance, in this connection, to note what is said by Mr Johns and Mr Cary in their affidavits filed on

behalf of the applicant. Mr Johns states that

the

respondent's advertisement "depicts a character which .... is a clear and obvious imitation of the 'Luigi' character as used by the applicant". Mr Cary's affidavit is to the same

effect. But so to conclude is not to establish that the advertisement would convey to the ordinary reasonable viewer

any of the

representations on which the applicant relies or

14.

provide a sufficient

ground

upon

which

grant

interlocutory injunction.

A reasonable viewer of the respondent's

who

is familiar with

the

applicant's

advertisements may

well wonder whether

is,

fact,

"Luigi" who

is taking part in the advertisement for the

respondent and why

he would be doing

so.

That viewer may

even experience some confusion over the matter.

But, again,

even if that be so, it is not sufficient to entitle the

applicant to the relief it seeks.

What the advertisement complained of would portray to the Ordinary reasonable viewer

is a matter of impression.

I have viewed the advertisement a number of times.

I am not

persuaded that there is an issue of a sufficiently substantial kind that the Ordinary reasonable viewer would

think

that

the

dvertisement

represents

that

the

respondent's business is the same business as that conducted by the applicant or that it has any connection or

association with the applicant

that the applicant has

given its imprimatur, endorsement

OK stamp of

approval to

the product being

marketed by the

respondent.

In my

opinion, objectively viewed, the advertisement does not, in fact, make any of the statements attributed to it by the applicant.

Being of opinion that there is no substantial issue to be tried, I need not consider the balance

of convenience.

15.

For the reasons

set out above,

the motion for

interlocutory relief is

dismissed.

The applicant

muet pay

the respondent's costs of the motion.

I	certify that this and

the preceding 14 pages are

8 true copy of the Reasons

for Judgment herein of the

Honourable	Justice	Mr
Neaves .

Associate

Dated:

3 July 1987

Counsel for the applicant

: Mr T.E. O'Connor

Solicitors for the applicant :

Mallesons Stephen Jaques

Counsel for the respondent

: Mr P.A. Tribe

and Mr E.W. Nielsen

Solicitors for the respondent : E.W.

Nielsen & Co.

Date of hearing

: 29 May 1987

[1987] FCA 289

3 Jul 1987