Gilltrap, T.J. v Autopromos Pty Ltd

[1995] FCA 151

CATCHWORDS

INTERLOCUTORY INJUNCTIONS - no reasonable risk that conduct sought to be restrained will occur - balance of convenience - interlocutory relief having the character of final relief.

COSTS - applicants continue proceedings despite respondents having ceased offensive conduct voluntarily.

PASSING OFF - contravention of s. 52 of the Trade Practices Act (1974) - use of descriptive words - minor changes sufficient to ensure no misleading or deceptive conduct.

TERENCE JOHN GILLTRAP & ANOR v AUTOPROMOS PTY LTD & ANOR
No. QG 14 of 1995

SPENDER J
BRISBANE
14 MARCH 1995

IN THE FEDERAL COURT OF AUSTRALIA     )
QUEENSLAND DISTRICT REGISTRY         )    No. QG14 of 1995
GENERAL DIVISION  )

BETWEEN:    Terence John GILLTRAP and Maree Rose GILLTRAP

Applicants

AND:    AUTOPROMOS PTY LTD

ACN 007 362 683
  First Respondent

AND:    AUSTRALIAN CONCOURS D'ELEGANCE (VIC) PTY LTD

ACN 005 868 093
  Second Respondent

CORAM:    Spender J
PLACE:    Brisbane
DATE:     14 March 1995

MINUTES OF ORDER

THE COURT ORDERS THAT:

(i)the application for interlocutory relief be refused;

(ii)the costs of the application for interlocutory relief be reserved.

Note:     Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA     )
QUEENSLAND DISTRICT REGISTRY         )    No. QG14 of 1995
GENERAL DIVISION  )

BETWEEN:    Terence John GILLTRAP and Maree Rose GILLTRAP

Applicants

AND:    AUTOPROMOS PTY LTD

ACN 007 362 683
  First Respondent

AND:    AUSTRALIAN CONCOURS D'ELEGANCE (VIC) PTY LTD

ACN 005 868 093
  Second Respondent

CORAM:    Spender J
PLACE:    Brisbane
DATE:     14 March 1995

REASONS FOR JUDGMENT

This is an application for interlocutory relief.  The nature of the interlocutory relief sought has varied as amended notices of motion on behalf of the applicants have been filed.  The present prayer for interlocutory relief is contained in an amended notice of motion filed 10 March 1995 by which Terence John Gilltrap and his wife, Maree Rose Gilltrap, seek to restrain Autopromos Pty Limited and Australian Concours D'Elegance (Vic) Pty Ltd until trial or earlier order from promoting, advertising, or publicising an event to be called "Australian Concours D'Elegance" or "National Concours D'Elegance".  The notice of motion also seeks that the respondents be restrained from passing off or attempting to pass off their business as the business of the applicants.

The notice of motion further seeks that the second respondent do all things necessary to cause its name to be changed to delete the words "Australian Concours D'Elegance" or words similar thereto, such as "National Concours D'Elegance", and other matters associated with such a name change and requiring it to lodge notice of a resolution to give effect to that name change with the Australian Securities Commission, and further that they cause their registered business name to be changed by deleting the words "Australian Concours D'Elegance" or words similar thereto such as "National Concours D'Elegance". 

The notice of motion further seeks the delivery up for destruction, on oath, of all printed and written material in the possession of the respondents bearing the words "Australian Concours D'Elegance" (with one immaterial exception), that they be restrained from displaying at their premises or in connection with their business the words "Australian Concours D'Elegance" or "National Concours D'Elegance", and finally that the respondents be restrained from not only promoting, advertising or organising an event called "The Australian Concours D'Elegance" or "The National Concours D'Elegance" on 2 April 1995 but also from holding any such event.

The nature of the interlocutory application has changed in response to decisions made by the respondents concerning their proposed conduct.  The applicants commenced trading under a registered business name "The Australian Concours D'Elegance" in June 1987, but in 1994 that registration lapsed for non-renewal.  The applicants have continued in business under that name from 1987 to the present and have conducted an event called "The Australian Concours D'Elegance" at Royal Pines Resort on the Gold Coast in 1992, 1993, 1994 and most recently on 12 March 1995. 

The event is modelled on an event of international importance, the Pebble Beach Concours D'Elegance held each year in August on the Monterey Peninsula in California.  In 1995 in conjunction with the Indy Grand Prix Car Race the Australian Concours D'Elegance event, conducted by the applicants, has been nominated an official event of the Indy program.  During the period in which the Gilltraps have conducted their concours, substantial sums have been expended on promoting the event, both within Australia and internationally.  Notwithstanding a submission by the respondents to the contrary, I am satisfied that notwithstanding the descriptive nature of the words describing the business conducted by the applicants, there is a reputation and a goodwill attaching to the Australian Concours D'Elegance in the applicants.

In BM Auto Sales Proprietary Limited v Budget Rent A Car Systems Proprietary Limited (1977) 51 ALJR 254 the High Court concluded that a name composed of descriptive words may become distinctive of a particular business, and if a plaintiff shows that such combination used by him distinguishes his business, and that the use of the name by the defendant was calculated to deceive persons into supposing that the defendant's business was that of the plaintiff and was likely to cause damage to the plaintiff's business, he would be entitled to relief.

That case concerned the use in the Northern Territory by a person of the name 'Budget Rent A Car' in circumstances where there had been a national company conducted under that name in Australia.  On the evidence before me it seems to be the case that the applicants, notwithstanding their choice of descriptive words for their business, have made out a case, at least for the purposes of interlocutory relief, of a goodwill and reputation in the description 'Australian Concours D'Elegance' as it relates to their business and the annual event they conduct, to be entitled to relief by the court from persons who seek to exploit that reputation.

The complications in this case arise because when the circumstances of the applicants' business were made known to the respondents, it was proposed by the respondents, through their solicitors, that they would no longer use the description 'Australian Concours D'Elegance' in relation to their proposed event on 2 April 1995 at Domaine Chandon Winery in the Yarra Valley, but would promote their event as the 'National Concours D'Elegance'.  They would desist from advertising under the earlier name and would also make a disclaimer of any connection between the event promoted by the respondents and the event promoted by the applicants.

Notwithstanding this very significant concession on behalf of the respondents, the applicants' case, it seems to me, has proceeded substantially as if the threatened conduct by the respondents of conducting an event under the name 'Australian Concours D'Elegance' has continued unaltered.  The real question behind the question for interlocutory relief is whether the reputation by the applicants in the description 'Australian Concours D'Elegance' is sufficient to entitle them to orders restraining the respondents from conducting an event called 'The National Concours D'Elegance', and in my opinion, they are not entitled to that relief.

Had there been a persistence on the part of the respondents in their initial plans, the result may very well have been different.  But for the reasons which I will now give, it seems to me that this is not a case where the court, considering the dual tests for the grant of interlocutory relief, namely whether there is a serious question to be tried and, if there is, where the balance of convenience lies, is such as to call for the grant of that relief.  First of all, there is no proprietorial right in relation to the words 'Concours D'Elegance'. 

According to the Concise Oxford Dictionary, those French words mean a "parade of vehicles with prizes for the most elegant-looking".  That dictionary definition indicates that the words are from the French meaning a "contest of elegance".  The phrase does not appear in the shorter Oxford or in the Macquarie Dictionary, but the material filed on behalf of the Gilltraps makes it plain that the phrase is quite widespread and understood in Australia.

One of the exhibits to the affidavit of the applicants, filed on 14 February 1995, has an article which asks the question "What is Concours D'Elegance?"  That article says:

"Like many phrases in the English language, 'Concours D'Elegance' means many things to people.  Translated from the French it means, "An elegance competition."

The article continued:

"The term was used in France around the turn of the century at events where cars were judged for their appearance and equipment. "

And later the article noted:

"As enthusiasts began to restore cars in the early fifties, various clubs and organisations began to hold 'Concours D'Elegance'.

A further exhibit to the same affidavit refers to the event conducted by the Gilltraps in the following way:

"The Australian Concours D'Elegance is a one day automobile event held to judge the most elegant car in Australia. "

And later:

"The Australian Concours D'Elegance is modelled on the world famous Pebble Beach Concours D'Elegance held on the Monterey Peninsula in California each August, and attended by the Gilltraps annually.  With adequate support and sponsorship we would be in a position to invite one or two automobiles from overseas to participate.  This would assist in establishing the Australian Concours D'Elegance as a world class event. "

Mr Lawrie, who has a significant influence on the respondents, in an affidavit swears:

"A Concours d'Elegance is an event at which motor vehicles are displayed and judged.  The vehicles are judged for their state of preservation, authenticity and beauty.  Such events are commonly held and, to my knowledge, there would be 30 to 40 such events held in Melbourne each year.  " 

It appears that the respondents were able to register the name 'Australian Concours D'Elegance' in Queensland, because of the lapsing of the registration of that name in the applicants.  But a letter from solicitors for the respondents makes plain that they are prepared to release the registration in their name of that term and to cause it to be transferred to the applicants, it being their intention to promote their event, not under the name 'Australian Concours D'Elegance' but under the name 'National Concours D'Elegance'.

The primary submission in the altered circumstances, on behalf of the applicants, is that the term 'National Concours D'Elegance' is a mere pseudonym for the words 'Australian Concours D'Elegance' and the same legal

consequences should follow, as though the respondents had persisted in calling their event the 'Australian Concours D'Elegance'.

I do not accept that this is so, and the central reason for my rejecting the claim for interlocutory relief is a consequence of the fact that the applicants have chosen to identify and establish a good will and reputation in a phrase which is intrinsically descriptive.  The first word, 'Australian' is geographic, or purports to indicate the scope and the spread of the reach of the event hosted by the Gilltraps.  The words 'Concours D'Elegance', while they are French in origin, are sufficiently common and descriptive of a fashion parade for cars as not to permit any person to have a monopoly in respect of the use of those words.

In combination, it seems to me, that it is possible to establish, and in my view the Gilltraps have succeeded in so establishing, a reputation and a goodwill in those words, notwithstanding their descriptive nature. What this means, however, is that very small differences will be sufficient to permit others to conduct similar events without being in breach of the proscription against passing off or the prohibition contained in s. 52 of the Trade Practices Act 1974 against misleading and deceptive conduct.

Stephen J in Hornsby Building Information Centre Pty Limited v Sydney Building Information Centre Limited (1977-1978) 140 CLR 216, said at 229:

"There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name.  Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public.  In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods that is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor's trade name will render the latter immune from action (Office Cleaning Services Ltd v. Westminster Window and General Cleaners Ltd (1946) 63 R.P.C. 39 at p. 42, per Lord Simonds). As his lordship said, at page 43, the possibility of blunders by members of the public will always be present when names consist of descriptive words - 'So long as descriptive words are used by two traders as part of their respective trade names, it is possible that some members of the public will be confused whatever the differentiating words may be. '  The risk of confusion must be accepted, to do otherwise is to give to one who appropriates to himself descriptive words an unfair monopoly in those words and might even deter others from pursuing the occupation which the words describe. "

At page 230, his Honour continued:

"If this be so in the case of passing off actions the case of s. 52(1), concerned only with the interests of third parties, is a fortiori.  To allow this section of the Trade Practices Act to be used as an instrument for the creation of any monopoly in descriptive names would be to mock the manifest intent of the legislation.  Given that a name is no more than merely descriptive of a particular type of business, its use by others who carry on that same type of business does not deceive or mislead as to the nature of the business described. Thus both the Hornsby and the Sydney Centres are building information centres and no one is being deceived as to the nature of the service which is available there.  Any deception which does arise stems not so much from the Hornsby Centre's use of the descriptive words as from the fact that the Sydney Centre initially chose descriptive words as its title and for many years thereafter was the only centre in Sydney which answered the description which those words provide.  In consequence members of the public have come to associate its particular business with that type of activity.  Evidence of confusion in the minds of members of the public is not evidence that the use of the Hornsby Centre's name is itself misleading or deceptive but rather that its intrusion into the field originally occupied exclusively by the Sydney Centre has, naturally enough, caused a degree of confusion in the public mind.  This is not, however, anything at which s. 52(1) is directed. "

There are further reasons which persuade me that the grant of interlocutory relief should not be made in this case.  The evidence suggests to me that if the respondents' event, styled as the 'National Concours D'Elegance', is held, there will not have been and will not in the future be any adverse effect on the applicants' reputation and the standing of the Concours D'Elegance which they conduct. 

The 1995 Australian Concours D'Elegance conducted by the applicants was held last Sunday, 12 March 1995, and the evidence suggests that it was "bigger and better" than the previous three annual events.  The evidence seems to suggest that interstate entries for the 1995 event were significantly higher than in the earlier years, and I am not satisfied that it has been shown that if the respondents conduct their event as proposed, namely, under the name 'National Concours D'Elegance', there will be any significant adverse effect on the applicants.  If, however, I am wrong in that assessment, it seems to me that damages is an adequate remedy.

What I have said thus far concerning the phrase used by the applicants to describe their business seems to me to be the subject covered by the comments by Lord Herschell in a trademark context in Eastman Photographic Materials Company Application (1898) 15 R.P.C. 476 where his Lordship said at 484:

"The vocabulary of the English language is common property; it belongs alike to all; and no one ought to be permitted to prevent the other members of the community from using, for purposes of description, a word which has reference to the character or quality of the goods. "

The principle in Hornsby and in Office Cleaning Services Ltd v Westminster Window and General Cleaners Ltd (1946) 63 R.P.C. 39, which is referred to in those parts of the judgment of Stephen J to which I have earlier made reference, has been applied in many cases, including Morgan and Banks Pty Ltd v Select Personnel Pty Ltd (1991) AIPC 90 780. The material in the present case establishes that, after the respondents received the advice of counsel, which seems to me to be sensible and sound, they changed the name of their company and event to 'National Concours D'Elegance'. There is clearly no reputation or goodwill established by the applicants in the name 'National Concours D'Elegance', and it really is a question of whether the reputation and goodwill they have in the name 'Australian Concours D'Elegance' permits them to restrain somebody from conducting a similar event with the description 'National' attaching to it.

On analysis, it seems to me that this amended claim for interlocutory relief evinces an impermissible attempt to keep the respondents from competing in a field previously the sole province of the applicants.  After these proceedings were commenced on 9 February 1995, solicitors for the respondents wrote on 3 March indicating that they proposed to stop using the name 'Australian Concours D'Elegance'; would change the name of the second respondent to 'National Concours D'Elegance (Vic) Pty Ltd'; would prepare to transfer the registration of the business name 'Australian Concours D'Elegance', registered in Queensland, to the applicants and would ensure that all advertising, mailouts, press releases and brochures in relation to the event to be conducted by them on 2 April 1995 include a notice setting out the fact that their event had no relation to the event organised so successfully by the applicants.

There is in evidence before me a new flyer by the respondents under the heading 'National Concours D'Elegance', which does contain, admittedly in smaller font than the rest of the notice, the following disclaimer:

"PLEASE NOTE: This event has no connection with and is not to be confused with the Australian Concours D'Elegance which has been held at the Royal Pines Resort, Gold Coast, Queensland in 1992, 1993 and 1994, and is to be held on 12 March 1995.  Information about this event can be obtained from the organisers on [phone]. "

It appears from the evidence that all sponsors of the respondent's event have been advised concerning these changes, although it appears that, through inadvertence, an advertisement which appeared in 'The Age' newspaper on the weekend just passed did not have the disclaimer which was the subject of the undertaking given by the respondents through their counsel to this court on 8 March 1995.   It seems that the claim that this omission was an unintentional oversight is correct.

Shortly put, my view is that it is not now appropriate to grant an interlocutory injunction, having regard to the steps taken by the respondents subsequent to the initiation of these proceedings on 9 February 1995. In my opinion, there is now no reasonable risk that conduct in contravention of s. 52 of the Trade Practices Act will occur and, in those circumstances, consistent with the judgment of Trade Practices Commission v Gold Coast Property Sales (1994) 49 FCR 442, an interlocutory injunction should not be granted. In that case, at p. 453, Cooper J said:

"Having regard to the observation of the members of the Full Court in Tobacco Institute of Australia Ltd v. Australian Federation of Consumer Organisations Inc (No 2) and ICI Australian Operations Pty Ltd v. Trade Practices Commission, and the view that I take that there is no reasonable risk of re-broadcasting of the material complained of or similar material by the eighth respondent pending trial, the applicant has failed to satisfy me that the granting of interlocutory relief in the terms of the notice of motion or the form of the undertaking given to
the court by the other respondents is necessary or appropriate. "

In addition, it seems to me that the balance of convenience clearly favours the refusal of interlocutory relief.   This is one of those cases where the grant of interlocutory relief in the terms sought, namely, prohibiting the carrying on of the event at all, has all the hallmarks of final relief.   Having regard to the material concerning the consequences for the respondents of any such order, it is plain that the grant or refusal of the interlocutory injunction would have a practical effect of putting to an end the action by the respondents in conducting a concours d'elegance.

As Lord Diplock said in NWL Limited v Woods [1979] 3 All.E.R. 614, at 626:

"Where ... the grant or refusal of the interlocutory injunction will have the practical effect of putting an end to the action because the harm that will have been already caused to the losing party by its grant or its refusal is complete and of a kind for which money cannot constitute any worthwhile recompense, the degree of likelihood that the plaintiff would have succeeded in establishing his right to an injunction if the action had gone to trial is a factor to be brought into the balance by the judge in weighing the risks that injustice may result from his deciding the application one way rather than the other. "

And in Kolback Securities v Epoch Mining NL, [1987] 8 NSWLR 533 McLelland J, in the Equity Division of the New South Wales Supreme Court, said at 536:

"Apart from this, although normally the Court 'does not undertake a preliminary trial, and give or withhold interlocutory relief upon a forecast as to the ultimate result of the case' (Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 at 622), there are some kinds of case in which for the purpose of seeing where lies the balance of convenience (or more specifically 'the balance of the risk of doing an injustice' - see per May LJ in Cayne v Global Natural Resources plc [1984] 1 All ER 225 at 237, cf per Brennan J in Brayson Motors Pty Ltd v Federal Commissioner of Taxation (1983) 57 ALJR 288 at 292; 46 ALR 279 at 285), it is desirable for the Court to evaluate the strength of the plaintiff's case for final relief... "

Essentially for the parties the important sentence is this:

"One class of case to which this applies is where the decision to grant or refuse an interlocutory injunction will in a practical sense determine the substance of the matter in issue: see, eg, NWL Ltd v Woods [1979] 1 WLR 1294 at 1306-1307; [1979] 3 All ER 614 at 625-626 per Lord Diplock; Cayne v Global Natural Resources plc.   The present is such a case. "

The evidence shows that the respondents have committed substantial sums of money to the holding of their event and that an interlocutory injunction would ensure that most of that money would be wasted.   To grant an interlocutory injunction would, in effect, give final relief in view of the likely effect on the further conduct of the respondents' business.

I am by no means satisfied that the applicant's undertaking as to damages is empty, as was suggested by counsel for the respondents.   The inference from the way and the length of time over which their business has been conducted suggests quite to the contrary.  
         There is, however, one further matter to which reference should be made.   The grant of an interlocutory injunction preventing the carrying out of the concours d'elegance organised by the respondents would be likely to affect third party interests adversely.

It seems plain to me that arrangements have been entered into with sponsors and others which would clearly be affected if the event has to be cancelled.   It seems to me that this consideration is a not unimportant one.  It was the subject of observations by Thomas J in the Supreme Court of Queensland in Clarke v Japan Machines (Australia) Pty Ltd [1984] 1 QdR 404 where his Honour said, at 419, in response to a suggestion that the only relevant convenience in the balance of convenience test is that of the parties to the action:

"In the normal case this is true, and many statements can be found in which the balancing process is described by reference to the immediate parties.  But the scope for consideration by the Court is not cut off at the point of legal interest of the immediate parties.  In 1851, Sir R.T. Kindersley V.C. observed, in a case concerning an injunction to restrain infringements of a water right, 'whenever a Court of Equity is asked for an injunction in cases of such a nature as this, it must have regard not only to the dry strict rights of the plaintiff and the defendant, but also to the surrounding circumstances; to the rights or interests of other persons which may be more or less involved:' (Wood v Sutcliffe) (1851) 2 Sim. N.S. 163 at 165; 61 E.R. 303 at 304).  Dr Spry suggests that not only hardship to the parties, but also hardship or injury to third persons may be relevant as tending to establish that it is reasonable to grant interlocutory relief (Equitable Remedies 2nd ed., pp. 440 and 375).   The latter reference was specifically quoted and stated to be accurate by Cumming-Bruce L.J. in Miller v Jackson [1977] 1 Q.B. 966, 988. "

There was a submission on behalf of the respondents that the applicants lacked clean hands.   In support of this submission, reference was made to a flyer produced by them which asserts:

"Don't miss the fifth Australian Concours D'Elegance TM Indy Week 1996 and Australia's National Concours D'Elegance TM -".

There is no evidence that a trademark has been granted in respect of either collocation of words.   Further, reliance was placed on a statement which appears in that flyer:

"The concept is the property of Terry and Maree Gilltrap. "

That last statement seems to me to be redolent of the difficulty which attaches to the applicant's claim here.   There is no proprietorial rights in the concept of holding a concours d'elegance, and the attempts to prevent persons from holding similar events on a national basis is, in my view, an attempt to claim a monopoly to which the applicants are not justly entitled.   They are entitled to have protected the reputation and goodwill in their business, but they are not entitled to prevent competitors from seeking to hold similar events, provided that that is done in a way which does not detract from their reputation or goodwill.

In my opinion, what is proposed on behalf of the respondents clearly distinguishes the respondents' product or business from that of the applicants.  The relief claimed includes some prayers which clearly go beyond that which should be ordered or might be ordered on an interlocutory application.  In particular, delivery up of the material is not appropriate in this sort of case, which is not a trademark or a copyright infringement case.

For all of these reasons then I will not make any interlocutory order.  The question of costs, however, becomes an important matter.  It seems to me that after the respondents had replied by letter of 3 March 1995 as to their intentions, the question of their then proposed conduct should have been considered by the applicants, and their conduct since then has been such as to seek relief to which they are not entitled and incur costs for the respondents which would have been obviated had there been a calmer assessment of the respondents' proposals.

As against that, there was a clear threat to the goodwill and reputation in the applicants of their reputation in the name 'Australian Concours D'Elegance' up until that time.  The matter coming before the court for the first time last week had to be adjourned because of the late supply of material on behalf of the applicants, and the ultimate result has been a decision in favour of the position adopted by the respondents.  One possibility as to costs is to permit the applicants to have their costs of the application up until some time shortly after 3 March, and then the respondents
their costs subsequent; but it seems to me that that is perhaps a little bit fussy in all the circumstances.

The notice of motion for interlocutory relief is refused. 

Notwithstanding my indicated intention that there be no order as to costs, having regard to what counsel have said, I will simply reserve the costs of the interlocutory application. 

I certify that this and the  preceding eighteen (18) pages are a true copy of the reasons for judgment herein of the Honourable Justice Spender.

Associate

Date of hearing             : 14 March 1995
Date of judgment            : 14 March 1995   

Counsel for the applicants:  Mr A. Tropeano
instructed by:              Mr G. F. Knight

Counsel for the respondents: Mr D. M. Logan

instructed by:              Delaney & Delaney, Town Agents for Bullards, Melbourne