Ford Motor Company of Australia Ltd v Stephen Campbell of All Crash Parts Pty Ltd

DESIGNS ACT 2003

DECISION OF A DELEGATE OF THE REGISTRAR OF DESIGNS, WITH REASONS

Re:Objection by Ford Motor Company of Australia Ltd to amendment of applications for compulsory licences in relation to registered designs 131506, 131507, 131508, 131509, 131510, 131511, 131576, 131577 - CAR PART DESIGNS - filed in the name of Stephen Campbell of All Crash Parts Pty Ltd.

Delegate:

Terry Williams

Representation:

Opponent: written submissions by Davies Collison Solicitors

Applicant (for licence and for amendment): written submissions by McCullough Robertson, solicitors

Decision:

Power to amend application for compulsory licence. Error by solicitor. Effect of repeal of 1906 Act. Amendment allowed.

Legislative environment

Before setting out the facts that are applicable in this matter, it will be useful to set out the general legislative provisions. This matter comes for determination under the Designs Act 2003 (the 2003 Act). Section 150 of the 2003 Act repeals the former Designs Act 1906 (the Old Act). However, S 154 of the 2003 Act preserves any relevant “application, request, action or proceeding” that was on foot when the 2003 Act commenced and that had not been finally dealt with.

Background

At the centre of this opposition matter are eight registered designs applicable to parts of the Ford motor vehicle commonly known as the AU series Falcon introduced in 1998.
An applicant described as “Stephen Campbell of All Crash Parts Pty Ltd” has applied for the issue of a compulsory licence that would allow production of relevant motor vehicle parts the subject of design registrations held by Ford Motor Company of Australia Ltd (“Ford”), without fear this would infringe Ford’s design registration rights.
In what follows, I will refer to “Stephen Campbell of All Crash Parts Pty Ltd” as “the applicant”, without intending to differentiate between the individual and the company. I will use “itself” to indicate the applicant, again without intending to differentiate between the individual and the company. Now at issue is a proposal to amend the name of the applicant.

History of present matter

The history of this matter is that the Ford designs, for which registration was applied in 1996, had reached the end of their period of registration in early 2003. Ordinarily, an application to extend the period of registration under the Old Act must have been made before (or within six months of) the end of that period. However, Ford sought, and was granted, an extension of time within which to seek to extend the period of registration. In due course, proper process having been followed, the term of Ford’s design registrations was extended.
It is alleged that, in the interregnum during which the design registrations were no longer in force, the applicant (and here I use that term very loosely indeed, as will become obvious later) commenced to produce car parts the subject of the registered designs. The applicant wishes to avail itself of the provisions of a design regulation whereby a person who takes advantage of the ceasing of a design registration may, by the grant of a compulsory licence, be sheltered from a claim of infringement. The applicant made the necessary applications on 30 September 2004 under s 27B(7) of the Old Act. In what follows, there are in fact a total of eight separate registered designs, and a separate application for each. However, it will be convenient to speak of the application for a compulsory licence in the singular.
Ford has formally opposed the issue of any such licence. Such an opposition was governed by various provisions of the old regulations, including reg 29 and reg 29A. These, however, are now repealed. Instead, regulation 12.04(2) of the Designs Regulations 2004, the regulations made under the 2003 Act, allows that, inter alia, subsection 27B(7) of the Old Act and regulations 29 and 29A of the regulations under the Old Act are “taken to have effect in relation to an application for a licence under subregulation 29(2) of the old Regulations, as if those provisions had not been repealed”.
The overall result is that, because of the transitional provision in regulation 12.04(2), all of the circumstances - the ceasing of the design registrations, the extension of the period thereof, the actions and licence application made by the applicant, and Ford’s opposition - are to be assessed seamlessly under provisions that, strictly speaking, are or were contained in two designs Acts, the Old Act and the 2003 Act.

Error in making application

I turn now to the history of the present matter, which involves a request to amend the application for the compulsory licence.
When the applicant filed the application in 2004, the Designs Office noted that the preamble to the application indicated that it was made by “Stephen Campbell of All Crash Parts Pty Ltd”. The Designs Office was prepared, at that point, to accept that the application was ambiguous about the name. It did not read the name of the company as being simply a description of, for instance, the place of employment of Mr Campbell. The Designs Office recognised, on the basis of past experience, that there was a great likelihood that the form of words used by Mr Campbell was intended to be equivalent to “Stephen Campbell on behalf of All Crash Parts Pty Ltd”, and sought clarification accordingly. While perhaps the alternative view is that the wording is clear, and that Mr Campbell alone is the applicant, that was not the way the matter was dealt with and I think it would be inequitable to raise that issue now. In view of what follows, it would not affect the outcome in any case.
It has subsequently emerged that, because of circumstances that I will not set out at this point, neither Stephen Campbell nor All Crash Parts Pty Ltd should have been recorded as the name of the applicant. To clarify the situation, the lawyers acting for Mr Campbell and for a third party, Pacrim Trading Co Pty Ltd, (“Pacrim”) have requested that the application proceed in the name of Pacrim, whom the lawyers submit was at all material times the relevant person to make and prosecute the application.
Ford has objected strenuously to this amendment. I will leave the details of this to be elaborated below but the essence of the objection is the claim that the Registrar of Designs simply does not have a power to amend a licence application in the manner sought. I note that, if amendment of the present application is denied, the application for a licence would have to proceed in a wrong name, presumably rendering it of no use at all. That in turn assumes that the application could survive the opposition process.
I have given both parties more than ample opportunity to request a hearing – reg 11.22 would mandate such an opportunity. Neither party has taken that option but there has been a thorough exchange of written submissions and what follows are my reasons for decision.

Decision on amendment

1. Power to make the amendment

At the heart, Ford says there is simply no power to make the amendment. If I am not in agreement with this proposition, Ford has argued that I should not, in proper exercise of any discretion that I might find to exist, make the amendment in any case.
The lawyers for the applicant agree with Ford’s lawyers that there is no specific amendment provision that would expressly allow this amendment. Indeed, Ford points out that the amendment provisions under the 2003 Act are confined to amendment of an application for registration, and of the register.
However, on behalf of the applicant it is firstly argued that since the registrar has the power to direct a person to perform an act (see reg 11.28) she clearly has the power to compel the applicant to provide “a corrected application”. I find this unconvincing. The lawyers for the applicant seem to have confused a piece of paper, a “corrected application” which they might be directed to file, with the underlying proceeding in the present matter. I can no doubt require the applicant to offer up a corrected application but that would be a fruitless course if I cannot bring about a correction in the name of the party who is involved in the present proceeding.
I would also reject any suggestion that the power given by regulation 11.24 to establish “practice and procedure” is itself a power that would authorise the amendment. This puts the cart before the horse. If I have the power to amend the application, the regulation in question would then allow me to establish practice and procedure for deciding on the allowability of such an amendment; it does not confer such power.
The lawyers for the applicant have a second string to their bow. It argues that the Acts Interpretation Act gives, and various authority notes, what I will call a general housekeeping ability in these matters. I agree with the proposition that if the Acts Interpretation Act or any other source gives the necessary power then (2003 Act, s 122) it is a power conferred on the registrar, and, by delegation, on me.
As to the existence of such a power, the arguments of the parties fall, broadly, under three headings. Firstly, Ford asserts that the applicant, or rather Pacrim, would be not be entitled to make a fresh application under precisely the same terms as the original. Therefore, they argue that any purported power to make the amendment does not exist or, if it exists, should not be construed so as to amount to “permitting to be done by mere amendment of an application what should be done by withdrawal of the application and filing of another application”[1].
[1] Full Federal Court in relation to a comparable amendment under s 65 of the Trade Marks Act. Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196.
I have to disagree with Ford as to its first premise, which seems, from their submission, to be the keystone of their case. In my own view, there does not seem to be anything to prevent Pacrim from applying, now, reliant on reg 12.04. Ford argues a question of detail, and I therefore set out reg 12.04(2) in full, with bolding of the words on which Ford places reliance:
Subsection 27B(7) of the old Act, and regulations 29, 29A and 29B of, and Schedule 1 to, the old Regulations, are taken to have effect, in relation to an application for a licence under subregulation 29(2) of the old Regulations, as if those provisions had not been repealed.
Ford seizes on the text that I have bolded, arguing that since subreg 29(2) is repealed, the action of the new regulation is limited to an application already made under subreg 29(2). It supports this by noting that the reg 12.04 only came into effect some months after the repeal of the old regulations. It is said by Ford that the words in bold would not be needed if the provision was meant to provide a continuing right for all third parties (such as Pacrim) to apply now, just as if the provisions had not been repealed.
I cannot agree. The important part of the reading is the reference to subsection 27B(7). This was clearly a repealed piece of legislation when reg 12.04 came into effect. The new regulation recognises that the Old Act and the old regulations were already repealed, but provides that certain provisions are taken to have effect as if they had not been repealed. The first and foremost result is that the former terms of s 27B(7) continue to have substance and effect. The provisions of s 27(B)7 which thus continue are (emphasis added):
Where an extension of time is granted for doing a relevant act, the prescribed provisions have effect for the protection or compensation of persons who availed themselves (or took definite steps by way of contract or otherwise to avail themselves) of the design concerned because of the failure to do the relevant act within the time allowed, the lapsing of the application or the ceasing of the registration, as the case may be.
The relevant “prescribed provisions” that apply here are regulation 29, which allows for the making of an application for a licence if certain circumstances applied to the applicant, and regs 29A and 29B, which allow for opposition to, and decision on, such an application. It makes sense for reg 12.04 to describe the mechanism thus created as “an application for a licence under subreg 29(2) of the old regulations”, simply to better describe what would otherwise be a somewhat obscure reference to something created by the interaction of old s 27(B)7 and the prescribed provisions thereunder. Those provisions are a package. They were, and are, part of repealed legislation, it is true, but their terms are incorporated into the current statutory regime by the action of reg 12.04(2), just as effectively as if they had been incorporated as additional paragraphs of the new regulation.
This, of course, would merely establish that Ford, if it is successful in preventing this amendment, can do no more than force Pacrim to apply, again, it its own name. It does not necessarily determine the allowability of the amendment now sought, but it is certainly of assistance.
Otherwise, for the applicant it is said that what is at issue is a mere misnomer. Here, the solicitors for the applicant have characterised this error as one which simply mis-identifies the licence applicant, attributing to it the wrong name, “All Crash Parts Pty Ltd”. In essence, they say, this is a case of “right applicant, wrong name”. I find this puts a gloss on the matter. True it is that the application was filed in its present form because of a gratuitous intervention by an employee of the applicant’s solicitor, which neither her employing supervisor nor Mr Campbell noticed. Just as true is the fact that Mr Campbell has gone to the trouble to create or maintain two separate bodies corporate, Pacrim and All Crash Parts Pty Ltd. The relationship between the man and the two companies is set out in evidence and noted below but the simple fact is that the man and/or the wrong company filed the application. As Ford’s solicitors put it: “It is not that the Applicant was incorrectly named. Rather, the application was made by the wrong party”. It seems to me that, while the circumstances that attended this error are regrettable, the solicitors for the applicant are seeking to minimize the seriousness of the error that was made by casting it as a misnomer. It is considerably more than this, as Ford appreciates.
The applicant’s solicitor puts up a series of arguments that suggest that the there is a general housekeeping power that would allow this to be fixed. It is said firstly that there is a need to apply a broad, purposive interpretation to the legislation. They note here s 15AA of the Acts Interpretation Act, and their point is appropriate.
Ultimately, the reference by Ford to Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd, previously noted, is critical. In that case, the Full Court of the Federal Court was able to point to clear tension between the regime that existed for the change in ownership of a trade mark and the amendment to the name of the applicant that was sought to be made under s 65 of the Trade Marks Act. Here, there is no such tension.
The lawyers for the applicant have noted s 33(3) of the Acts Interpretation Act. This provides:
Where an Act confers a power to make, grant or issue any instrument (including rules, regulations or by-laws) the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.
I will accept at face value the applicant’s argument that “instrument” has been interpreted as going beyond legislative instruments[2]. Also, it is clear that the Register of Designs should be as accurate as possible, and that under reg 9.05 the Registrar of Designs has power to correct a “clerical error or obvious mistake” on the register itself. The lawyers for the applicant argue that the existence and importance of such provisions support their case. They then note s 33(3B) of the Acts Interpretation Act. I set this out, with bolding of a double negative:
(3B) Where an Act confers a power to make, grant or issue any instrument (including rules, regulations or by-laws), the power shall not be taken, by implication, not to include the power to make provision for or in relation to a particular aspect of a matter by reason only that provision is made by the Act in relation to another aspect of that matter or in relation to another matter.
[2] The lawyers for the applicant relied on, inter alia, Chittick v Ackland (1984) 53 ALR 143, Barton v Croner Trading Pty Ltd (1984) 3 FCR 95 and Heslehurst v Government of New Zealand 2002 189 ALR 99. The last of these, at para 25, seems applicable to the present situation.
Helpfully and appropriately, the lawyers for the applicant adapt this to the current situation as follows:

(a) where an Act grants the right to request a licence (per s.27B(7) and old regs 29(1) and (2)), and confers an associated discretionary power on the registrar to decide whether the licence should be granted, together with the power to grant it (per s.27B(7) and old r.29B),

(b) that Act must not be construed as excluding the power to make provision for a particular aspect of the licensing process (eg. amendment of a licence application) simply because the legislation either:

(i) expressly addresses another aspect of the licensing process, eg. when an applicant will qualify to apply, what criteria will be considered, etc (as per old reg 29(1)); or

(ii) addresses another matter, eg. the fact that a design owner may request amendment of their design application (as per old s. 13, now see s.28 of the new Act).

To come to the point, I think they are right, and there is a conspicuous lack of rebuttal in Ford’s arguments at this precise point.

2. Discretion – Ford’s arguments against the exercise

Ford’s fall-back position is that if I do have a power to make the amendment I should decline to do so for a number of reasons. These are said to be because:

• The amendment would mean that new applications are being made.

This argument is circular and must fail. If I have the power to amend an existing application, the fact that it has been amended does not make it a new application. Just the contrary: amendment of an existing application is no more than that, and its exercise does not create a new application.

• Lack of adequate explanation of the error.

As I have said, the licence application was filed in September 2004, by “Stephen Campbell of All Crash Parts Pty Ltd”. It was not until September 2005 that the Designs Office queried if it was Mr Campbell or the company subsequently named that was the applicant[3].
[3] The Designs Office has already frankly admitted that the delay happened because the relevant files were “misplaced” in the moving of the Designs Office to new premises operating under new administrative arrangements.
It is declared by the lawyers who filed the application, or otherwise shown in material that is in evidence, that:

Pacrim Trading Co Pty Ltd (Pacrim) trades as All Crash Parts.
- All Crash Parts Pty Ltd is a separate legal entity from Pacrim
- Stephen Campbell is the sole director and company secretary of both companies, a joint shareholder (with one other) of the former, and the only shareholder of the latter.
- Mr Campbell apparently has twice described himself as Stephen Campbell of All Crash Parts. He instructed his solicitor to prepare the licence application without any reference to the name of a company.
- The solicitor (at the time simply an articled clerk) who prepared the licence application referred to the applicant as “Stephen Campbell of All Crash Parts Pty Ltd”, appending thereafter the ACN attributable to that company. She believes that she would have done so after doing a search of Australian Securities and Investments Commission records, but is no longer certain of the details.
- The solicitor’s supervisor reviewed the licence application in draft form. (The draft, I note, had allegedly been prepared after “detailed instruction” from Mr Campbell, who at that time described himself as Managing Director of “All Crash Parts”.)
- Mr Campbell himself viewed the drafts and made detailed comments
- The introduction of “All Crash Parts Pty Ltd” was a gratuitous addition, not intended by the solicitor, her supervisor or Mr Campbell to have any effect on the substance of the application
- Delay since September 2005 up to 11 January 2006 when the amendment was requested, is attributable to Mr Campbell’s actions. These, the lawyers assert, were aimed at getting to the truth of the proper naming of the application, in order that the lawyers might respond to the September 2005 query from the Designs Office. There is, however, no apparent reason for the time that it took to get to the bottom of what the lawyers assert is a ‘mere misnomer’.

It is asserted by the lawyers for the applicant that Pacrim has traded as “All Crash Parts”. It is clear from the evidence that Pacrim has owned that business name registration for some time, and was doing business under that name in 2003.
The error is explained, in summary, as a combination of the well-meant action of a clerk, now herself a solicitor, and the subsequent failure of any of the people concerned to sufficiently check a fundamental detail of the application. It might be said, unfairly, that it is an adequate explanation that does not reflect particular credit on those involved but my own experience of cases such as those at issue in Crazy Ron, supra, is that such things, regrettable though they may be, happen in business.

• Consequences (for Ford and others) of delay.

Briefly, it is asserted that the amendment, after the application has been opposed, would have dire but unspecified consequences for Ford. I find this less than convincing: the onus is on the applicant to substantiate its case for a licence[4] and the applicant’s evidence is already filed and served. Ford has not explained how the amendment would impact on the notice of opposition, despite being in a good position to do so. Given that Ford goes on to note that hundreds of thousands of AU Falcons have been produced, I infer that Ford’s true objection is not to the amendment per se, but to any form of licence. Conversely, should the amendment be allowed and Ford find it necessary to amend its notice of opposition because of the amendment[5], the registrar would take a pragmatic view of this, and the applicant would be in a very poor position from which to complain.
[4] Part 4 of the old regulations was repealed and its effects are not retained by reg 12.04. After taking representations from the parties, I gave a direction under reg 11.24 to set the procedures for the conduct of this opposition. Despite the views of the applicant on the subject, it is more appropriate that the applicant be initially required to bring in evidence of why a licence should be granted than that an opponent show why it should not.
[5] The registrar’s delegate would, I would expect, adopt a broad reading of the notice of opposition in order to avoid elevating form above substance. I note that the regulations do not require Ford’s opposition to state grounds in detail, and that the onus is on the applicant to make a case, not on Ford to negate it.
Ford attempts to bolster its submission by an assertion that the public interest will suffer from my allowing the amendment. Ford notes that the public interest is in the efficient conduct of applications and oppositions. It does not explain how it would not be in the public interest to allow the amendment at this point in time. I would observe here that, had the Designs Office been able to deal with this matter expeditiously, such that the delay was entirely that of Pacrim, this argument would have had more force. But as things have transpired it hardly seems fair to penalise the licence applicant because the Designs Office was delayed in raising the issue in the first place. Indeed, part of the delay that has since followed is due to Ford’s own disinclination to any pragmatic allowance of the amendment. It is understandable that Ford will not assist the applicant. However, Ford itself must accept some of the responsibility for the delay. It is self-contradictory for Ford to insist on exact observance of the law while at the same time complaining about the delay that it has thereby added to what was, primarily, a processing delay at the Designs Office compounding a solicitor’s error. It thereafter becomes unreasonable for Ford to insist that these circumstances should militate against the exercise of my discretion in favour of the applicant.

Conclusion

The licence application may proceed in the name of Pacrim Trading Co Pty Ltd. The official record will be amended accordingly.

Costs

Understandably, Ford is concerned about any costs thrown away. I would observe that Ford’s insistence on a strict letter of the law approach has added to the costs of both parties. Having said that, I think further consideration of costs is inappropriate at the present time. The amendment issue is neither a proceeding before the registrar nor has it been the subject of a hearing. I will leave it to some future delegate of the Registrar of Designs to determine if the outcome today should have any bearing on costs in the opposition proceeding, which is the substantive matter at issue between the parties.

Terry Williams

Hearing Officer

20 Sept 2006

[2006] ADO 1

20 September 2006