Hugo Boss A.G. v Lazer, M

[1990] FCA 513

IN THE FEDERAL COURT OF AUSTRALIA	)
VICTORIA DISTRICT REGISTRY	No VG 372 of 1989

1

GENERAL DIVISION 1

BETWEEN: HUGO BOSS A.G.

(Applicant)

m:  MARY LAZAR

Coram:  Ryan J. RECEIVED

- Date: 16 August 1990

20 SEP 1990

W:  Melbourne EDERAL COURT OF

AUSTRALU	PRINCIPAL
REGISTRY

EX TEMPORE REASONS FOR JUDGMENT

.-

8 > .

On 15 February 1990 Woodward J. made an order granting permanent injunctions restraining the respondent from, amongst	8 ,
b. L .
r .
l
other things:	, .
l

"using in any manner whatsoever the 'HUGO BOSS', 'BOSS', and/or IBOSS-

HUGO BOSS' trade marks or any name or mark substantially identical or

deceptively or misleadingly similar thereto on or in relation to goods

not manufactured by or under the authority of the Applicant."

The order further restrained the respondent from "engaging in conduct liable to mislead the public as to the nature and/or the

t .-

manufacturing process and/or the characteristics of goods sold by

! . 8.

the respondent by using in any manner whatsoever" the marks to

I -

which I have just referred, or any name or mark substantially

i

identical or deceptively or misleadingly similar thereto. A further

I

I

I

I.

injunction restrained the respondent from passing off by using

m	:
, ,	I I

those marks, her goods as the goods of or associated with the

applicant and passing off her trade and business as and for a trade

C

i '

and business of the applicant or a trade or business affiliated
with the applicant.

By paragraph 4 of his Honour's order, the respondent was restrained from infringing Australian registered trade mark numbers B345,175, A442,954, A442,955 and A442,956, and in particular from using the three marks which I have earlier mentioned on or in relation to any of the goods in respect of which the said trade- marks are registered.

By paragraph 5 of the order it-was ordered that:

"The respondent pay t h e Applicant:

(a) damages under s e c t i o n 37 of t h e Fa i r Tradins Act (Vic tor ia) 1985;

(b)	damages under Sect ion 82 of t h e Trade Prac t i ces A c t 1974
( c )	damages o r a t t h e Applrcant 's option an account of p r o f i t s f o r
passing o f f ;
(d )	damages o r a t t h e Applicant 's opt ion an account of p r o f i t s f o r
rnfringernent of t h e s a i d Aust ra l ian reg r s t e red t r a d e marks
together with i n t e r e s t thereon;

such damages t o be assessed o r accounts t o be taken."

By paragraphs 6 and 7, his Honour ordered the respondent to or power which infringed the applicant's registered trade-marks and	"deliver up on oath to the Applicant" all goods in her possession
"all labels, tickets, ... dyes" and the like bearing the three specified trade-marks to which I have referred, or any mark substantially identical therewith or deceptively similar thereto. Those last two paragraphs of the order have, on the evidence, been complied with by the respondent.
His Honour then ordered that the applicants costs of and incidental to the proceedings including reserved costs be taxed and when so taxed be paid by the respondent and that the directions hearing in the application be adjourned to 30 March 1990.

not expressed to be by consent, the order made by Woodward J. was consented to by solicitors then acting for the respondent, Messrs. Strauss & Associates, who wrote to the solicitors for the applicant on 15 February 1990 a letter which, omitting formal parts, was in the following terms:

~ l t h o ~ ~ ~ h

- - .

"As you are aware we act for Mary Lazar and conflrm the advice given to you on the morning of 15 February that our client has this morning consented to 3udgment in terms of paragraphs 1 - 9 of the Minutes of Order sent to us by fax on 14th February a copy of which is attached to this letter. We would be pleased to receive a copy of the Order at your earliest convenience and also advice in relation to paragraphs 5 and 8. You will appreciate the view of our client that your client has not suffered any damage in view of the swing ticket which was attached to the garment clearly disclaiming any association with your client."

The copy of the draft order attached to Messrs Strauss & Associates' letter was in terms identical to the order later that day pronounced by Woodward J. who made the order without hearing argument or investigating any of the facts giving rise to the

issues between the applicant and the respondent.

In the circumstances, the consent order, in my view, embodied what was called in Siebe Gorman and CO Ltd v Pneu~ac Ltd (1982) 1 All E.R. 377 "a real contract between the parties". In that case, Lord Denning M.R. observed at 380:

"It should be clearly understood by the profession that, when an order is expressed to be made 'by consent', it is ambiguous. There are two meanings to the words 'by consent'. That was observed by Lord Greene MR in Chandless-Chandless v Nicholson [l9421 2 All ER 315 at 317, [l9421 2

K.B. 321 at 324. One meaning is this: the words 'by consent' may

evidence a real contract between the parties. In such a case the court will only interfere with such an order on the same grounds as it would wrth any other contract. The other meaning is this: the words 'by consent' may mean 'the parties hereto not objecting'. In such a case there is no real contract between the parties. The order can be altered or varied by the court in the same circumstances as any other order that is made by the court without the consent of the parties. In every case it is necessary to dlscover which meaning is used. Does the order evidence a real contract between the parties? Or does it only evidence an order made without obligation?"

The respondent, Mrs Lazar, who appears in person, has applied, presumably under 0.35 r.7 of the Rules of this Court for an order that the judgment pronounced by Woodward J. on 15 February 1990 be set aside. Order 35 rule 7 provides:

"(l).. The Court may vary or set aslde a judgment or order before it has been entered.

The Court, where it is not exercising its appellate or related jurisdrction under Divrsion 2 of Part I11 of the Act, may if it thinks fit vary or set asrde a judgment or order after the order has been entered where-

(2)

(a) the order has been made in the absence of a party, whether or not the absent party rs in default of appearance or otherwise

m default and whether or not the absent party had notice of

the motion for the order;

(b) the order was obtained by fraud;

(C) the order is interlocutory;

(d)	the order is an injunction or for the appointment of a receiver;
(e)	the order does not reflect the intention of the Court; or
(f)	the party in whose favour the order was made consents.

(3) A clerical mistake in a judgment or order, or an error arisrng in a judgment or order from an accidental slip or omission, may at any time be corrected by the Court.

(4) Sub-rule (2) shall not affect the power of the Court to vary or terminate the operation of an order by a supplementary order."

It is accepted on behalf of the applicant that the present order is interlocutory within the meaning of that rule; see e.g. Computer Edae Ptv Ltd v Auule Computer Inc (1984) 54 A.L.R. 767. Accordingly, the question which arises on this application is whether the Court should exercise the discretion conferred by 0.35 r.7 to set aside the judgment made, as I have found, pursuant to consensual arrangements between the applicant and Mrs Lazar through solicitors then acting for her.

In support of her motion to set aside the orders of 15

February 1990, Mrs Lazar has deposed:

"2. That I have not at any time contravened The Fair Trading Act, The

Trade Practices Act, or passed off or rnfringed the Applicant's registered trade marks.

3.   That prior to the making of the Order on 15th February I requested my Solicitors at the time to make my position clear and that is that I had not intentionally breached any mark that the Applicant was entitled to use and it was for this purpose that I attached a swing ticket to the items that I had for sale and this swrng ticket made it clear that I was not associated in any way with the Applrcant Hugo Boss.

4.  That I was at the time of the making of the Orders under extreme emotional and financial pressure as a result of a breakdown of a long standing relationship which I had with Phill~p Guest who was the Respondent in several actions brought by the Applicant's solicrtors on behalf of other parties and had been made aware that all of the Applicants represented by those Solicitors were considered to be professional litigants who used their financral standing to dominate other parties in Court proceedings.

5.  That I recelved advice from Counsel that proceedings in the Federal Court could cost up to $50,000.00 and that even if I won those proceedings my own costs would be substantial compared to the costs recovered against the Applicant and in view of my financial circumstances was unable to continue to obtain legal

representation.

6.  That I have been following the proceedings in the actions against Phillip Guest for some considerable time and have now the belief that I am able to defend these proceedings myself without the assistance of legal advrsors and in vrew of the fact that I have never admitted any liability maintain that there is no real contract between myself and the Applicant and therefore request the Court to vary the Order that has been made in these proceedings.

7.   That I did not object to the making of Orders restrainrng me from contravening The Fair Trading Act or The Trade Practices Act or from any passing off or rnfringing of the Applicant's registered trade marks however I have at all times maintained that I have not been guilty of any of those items and I also do not believe that the Respondent has suffered any damages and was therefore quite happy to have so called damages assessed on the basis that I would be able to present argument to show that the Applicant had not in fact suffered any damage and I also request the Court to review this particular aspect.

8.  That I request the Court to set aside the whole of the Order on the basis that my consent was of a no objectron variety."

It is significant that there is no suggestion in that affidavit that Messrs Strauss & Associates lacked authority to consent to the orders which were made by Woodward J., or that her consent had been procured by fraud, duress, mistake or non- disclosure of some material fact. Accordingly, one can adapt to the circumstances of this case, the concluding remarks of the High Court in Harvev v Phillios (1956) 95 C.L.R. 235 at 244 where their Honours, in a joint judgment, observed:

"When the defendants accepted the compromise requiring them to pay
E4,000 they believed that thereby they were putting an end to the

litigation. They acted upon the statement made by her counsel that the compromise was made w ~ t h the authorrty of the plaintiff. Once it appears that the plaintiff did in fact give an assent which had not been withdrawn up to the moment when the terms of settlement were signed, it can be nothrng to the pornt to say afterwards to the defendants that it was the result of her real desires or her judgment being overborne by her advisers, whatever may have been the degree of moral pressure that she felt."

I am also confirmed in the clear conclusion that the motion must be refused by the failure of the respondent to show facts which afford her a grima facie defence on the merits to the

have been purchased from the respondent which bears a legend which	applicant's claim. I have examined for myself a garment sworn to
consists of the reproduction, once in large capital letters and twice in small capital letters, of the mark "BOSS" of which the applicant is registered as the proprietor by the Australian Trademark A442,954 for use on "clothing, clothing accessories, head gear, footwear, all being goods in class 25 and all other goods in class 25".
Accordingly, the offer for sale of such garments constituted, prima facie, a blatant infringement of the applicant's mark. On the principles enunciated in Evans v Bartlam (1937) A.C. 473 at 489, the discretion which the respondent invokes therefore ought not to be exercised in her favour. In that passage, Lord Wright observed:

"A discretron necessarily involves a latitude of individual choice according to the particular circumstances, and differs from a case where the decision follows ex deb~to justrtiae once the facts are ascertained. In a case like the present there is a judgment, which, though by default, as a regular judgment, and the applicant must show grounds why the discretion to set it aside should be exercised in his favour. The primary consideration is whether he has merits to which the Court should pay heed; if merits are shown the Court will not prima facie desire to let a judgment pass on which there has been no proper adjudication."

-- - .

For these reasons, the motion must be refused with costs. In making that order, I should stress that, as Mr Clarke of counsel for the applicant has conceded, there is no impediment to the respondent contending, should the applicant proceed to have an assessment of damages as contemplated by paragraph 5 of the order of Woodward J. of 15 February 1990, that the applicant has suffered no damage as a result of the respondent's activities, whether by reason of the attachment to her garments of the swing ticket to

which she referred or for any other reason which she cares to advance should such an inquiry as to damages take place.

Accordingly, the order of the Court is:

1. that the motion is refused with costs;

2. that each of the applicant and the respondent file and serve by 21 September 1990 an affidavit of documents related to the assessment of damages or taking account of profits referred to in the order of Woodward J. of 15 February 1990;

3.   that the directions hearing herein be adjourned to 28 September 1990;

I certify that this and the preceding seven (7)

pages are a true copy of the Reasons for

Judgment of His Honour Mr Justice Ryan.

Associate:

Date: /6 /6/q0 t

---

Counsel for Applicant:	Mr M. Clarke
Solicitors for Applicant:	Freehill, Hollingdale C Page
Counsel for Applicant:	1
) Mrs M. Lazar appeared in person
Solicitors for Applicant:	)
Date of Hearing:	16 August 1990
Date of Judgment :	16 August 1990

- - -