Ian Wymer v Industrial Fan Equipment Pty Ltd

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS, WITH REASONS
Re:Opposition by Ian Wymer to registration of trade mark application 1068788(11) - FANMASTER - filed in the name of Industrial Fan Equipment Pty Ltd.

Delegate: Terry Williams

Representation: Opponent: Camen Champion of counsel, instructed by AU Trademarks
Applicant: Josephine Thornton of counsel, instructed by Hunt & Hunt, solicitors

Decision: 2008 ATMO 96
S 52 opposition: s 58 and 60 grounds not established, registration proceeding. Costs not awarded in view late filing of evidence by applicant.
Background

Trade mark application 1068788 was filed on 9 August 2005 (“the critical date”) in the name of Collair Pty Ltd (“Collair”), ACN 080 889 836, of 15 Daisy St, Revesby NSW. Registration of the trade mark FANMASTER was sought in class 11 in respect of “ventilating apparatus”. Subsequently, recordal of assignment of the application to Industrial Fan Equipment Pty Ltd (“IFE”) has been published by the Trade Marks Office as required under s 108 of the Trade Marks Act 1995 (“the Act”).
The application has been examined at the Trade Marks Office and advertised in December 2005 as having been accepted for possible registration.
Assignment of application
Subsequently, in May 2006, recordal of assignment of the application to IFE has been published by the Trade Marks Office as required under s 108 of the Trade Marks Act 1995 (“the Act”). The document filed at the Trade Marks Office to show proof of title is a letter dated 27 April 2006, seven months after the critical date. It is from “Metroll SA Pty Ltd (formerly (Collair))” and quoting the appropriate ACN. The letter says, “We have assigned our interest in the above application to (IFE)”. It is signed by K J Broadfoot, a director, and the change in name from Collair to Metroll SA Pty Ltd is supported by a copy of a certificate of registration on change of company name, issued by the Australian Securities and Investments Commission.
Opposition
Registration of the application, by then in the name of IFE, was then opposed by Ian Wymer (“the opponent”). The opponent argues primarily that the ownership of the trade mark FANMASTER, purported to rest now with IFE, does not, and that the opponent has the superior title such that he, rather than IFE, is the owner of the trade mark in terms of s 58 of the Act.
The parties have used the opportunity under the regulations to file and serve evidence to support their respective positions. IFE filed and served its evidence in answer to the opposition in June 2007, six months after being served with the opponent’s evidence in support. Thereafter, the opponent filed and served its evidence in reply, in December of that year.
There the matter rested until just before the hearing of the substantive matter, when IFE requested permission to serve and rely on further evidence. I regard that request as not having been particularly well justified. However, at the hearing of the substantive matter that was set down in Sydney in July 2008 Ms Champion, counsel for the opponent, was quite sanguine that the additional evidence sought to be adduced by IFE actually supported the opponent’s case, and requested, in the course of her submissions, that the material be allowed into the proceeding. Josephine Thornton, counsel for IFE, was profuse in her apologies for the lateness of the evidence, nearly all of which is dated within a day or two prior to the hearing. However, both advocates were able to make submission that addressed the totality of the new material. Therefore I think it would be pointless for me, now, to exclude it.
What follows is my decision of the opposition, made under delegation from the Registrar of Trade Marks.
Grounds considered
Ownership
It is well established that, in the absence of any use, the first person to apply to register a trade mark will, in most cases, be entitled to claim to be the owner of the trade mark. It is otherwise if the trade mark has been used before the filing date. In that case, and in the absence of fraud, the owner of a trade mark in Australia for particular goods or services is taken to be the first person to use it in the course of trade in Australia in relation to those goods or services[1]. In the present matter, Ms Champion staked the opponent’s claims on prior usage, such that the claim made by Collair at the critical date was defective. In the interests of coherence, I will interleave the submissions of counsel for the applicant and the opponent with my discussion of the evidence supporting this proposition.
[1] Aston v Harlee (1960) 103 CLR 391, and see also Shanahan’s Australian Law of Trade Marks and Passing Off at [11.70] and following
There were two vital questions, according to Ms Champion, that went to the validity of the ownership claim made by Collair at the critical date, 9 August 2005. Ms Champion noted that, at earlier times, the trade mark had been used by a company called Fanmaster Air Pty Ltd, (“FMA”). Ms Champion undertook a review of the evidence to date to show that, in the opponent’s view, the ownership of the trade mark had been thoroughly misunderstood by IFE and its principal, Garth Bird. She described the documentation purported to document IFE’s entitlements as “appalling” and the present application as hopelessly flawed.
Ms Thornton, for her part, argued that IFE was the possessor of enduring rights, which it has endeavored to enforce against the opponent in particular, even though its approach to the passing of title perhaps lacked sophistication. In Ms Thornton’s view, a proper understanding of the good title now resting with IFE required a proper understanding of the history of the matter.
My own view of the situation would be that Mr Bird, like others before him, has been rather busier running a business that sells fans than with the technicalities of legal transactions that have occurred over time.
The 1992 assignment
An initial part of this dispute is the efficacy and scope of an assignment that occurred in 1992 (“the 1992 assignment”). At that time there was a transfer of assets from Fanmaster Company Pty Ltd (“FMC”) to “Barry Warren on behalf of (FMA)”. That transaction is the first link in a chain of title on which IFE now relies. The difficulty, as Ms Champion argued the matter, was to know what was transferred to FMA. If there was no transfer of the trade mark rights from FMC in the terms alleged, then there was nothing that could validly be transferred by FMA, later, to Collair and from Collair to IFE.
Ms Champion noted that, in the 1992 assignment, the value of the contract was apportioned between goodwill, plant, fitting and chattels, and stock-in-trade. The goodwill portion was valued at “nil”.
IFE relies on the declaration of Eris Parker to establish the inclusion of trade marks in the sale from FMC. Ms Parker is the former managing director of FMC. In a declaration of 11 lines in length made 16 years after the events surrounding the 1992 assignment, she says that it “included trademarks”. By this, Ms Parker might be taken to mean the two registered trade, 83631 and 167040[2], trade marks that remained registered in the name of FMC until the registrations expired and were removed from the register. Ms Champion was very critical of the probative value of such opinions[3]. Ms Parker, she argued, was now giving belated and subjective evidence about what may have been her company’s intention in entering into the contract. But, leaving that aside, she argued that the opinion of Ms Parker is out of step with documents that were prepared by the seller’s solicitor for the consideration of Mr Warren at the time of the 1992 assignment. Annexure D to the Bird declaration of 21 July 2008 defines “the business” to consist of, among other things, the following description, which I quote verbatim.
1. The business name of “Fanmaster provided that it is not used in a company name that indicates that it is the same name of Fanmaster Company Pty Limited. It may be used in a company name but as long as the name of Fanmaster is included but is different from the existing name.
[2] FANMASTER, registered for, respectively, “electric fans of all types, including desk fans, exhaust fans, multivane fans, air-circulating fans, blower fans, and component parts thereof” and for “air conditioning equipment, air cooling equipment, air heating equipment, drying equipment, fans of all types and components of all the said goods
[3] Ms Champion referred to Codelfa Construction Pty Ltd v State Rail Authority of NSW (1981-82) 149 CLR 337 at 349 for the proposition that evidence that neither adds to nor subtracts from the written contract is receivable to allow the subject-matter of the contract to be better understood. As Ms Champion put it, such extrinsic evidence, to be relevant, must go to the facts of the contract, not to opinions about intention. Ms Thornton accepted this proposition.
This appears to be consistent with a view that, in entering into the contract, both parties had some eye on the prospect that a business name may be used as part of a company name to indicate something about the identity of another company (FMA, as matters turned out) vis a vis FMC. The very most that could perhaps be said about this is that the reference to “Fanmaster” is not inconsistent with it having, otherwise, a trade mark function. But, as Ms Champion noted, there was no express offer to sell the registered or common-law trade marks.
Barry Warren, to whom I have referred above, gives evidence that he was “the original owner of FMA”. Like Ms Parker, Mr Warren is of the view that the 1992 assignment included the trade mark.
Ms Champion suggested that it was unusual to set the value of the goodwill at zero where it includes trade marks that had been used. She noted the basic principle set out in Shanahan’s Australian Law of Trade Marks and Passing Off, 3^rd edition at p 386:
unless agreed otherwise, a transfer of goodwill carries with it the trade marks and trade name of the business. However, the trade marks and names to do not pass by implication under a transfer of something less than the goodwill, such as the stock in hand or business premises.
Ms Champion argued that the 1992 assignment was a case of “something less”. She invited me to infer that, since goodwill was valued at zero, it had not been transferred at all. She noted that neither the vendor of the business nor Mr Warren had ever done anything, subsequently, about trade mark registrations 83631 and 167040. It was not, she said, a genuine purchase with goodwill. No stamp duty had apparently ever been paid on the value of the goodwill – though she conceded that people were notoriously keen to avoid stamp duty payments. In short, no trade mark rights flowed from FMC to either Barry Warren or FMA. The rights were, instead, abandoned, since FMC deliberately ceased to conduct business under the trade mark.
I understand the basis on which Ms Champion would have me infer that the purported transfer with goodwill was not a genuine one. I cannot, however, draw such an inference. The 1992 assignment document and the conduct of the parties prevent me doing so. This is not the sort of purported but hollow transfer of goodwill at issue in cases such as Rey v Lecouturier[4], to which Shanahan refers. While it is clearly unfortunate that the parties to that assignment did not expressly deal with the trade mark registrations, the inference will not survive what Ms Thornton called a reality check. Both parties to the assignment appear to have conducted themselves, at all times, as though their intention was to transfer the right to use the trade mark and there is nothing in that conduct to detract from the terms of the 1992 contract, which shows that they did so.
The 2002 assignment
[4] (1910) 27 RPC 268.
As what she said was another defective part of the chain of title, Ms Champion fixed on looseness of description (as Ms Thornton put it, for her part) in dealings under the trade mark by IFE’s predecessor in title. That aspect is in itself a saga of some proportions. Mr Warren has made a declaration dated 21 July 2008. He declares that in 2002 he assigned the trade mark from himself to “(Collair), a division of HH Robertson Australia Pty Ltd” (“Robertson”) along with the business name FANMASTER AIR. That, however, could never have been accurate in law, as Ms Champion noted, since a company cannot be a division of another company. Nor is it necessarily an accurate account of what actually happened in 2002, as will be seen.
In an attempt to clarify this picture, Mr Wilton, the former chief executive of what he calls the HH Robertson Group, gives evidence about the 2002 assignment. His declaration too was made immediately before the hearing. He asserts that the seller was Mr Warren, but that the buyer was Robertson. As to linkage between Robertson and Collair, Mr Wilton is not helpful. He declares that Robertson and Collair are both subsidiaries of Pacific Industrial Corporation SA, (“Picsa”), which he describes as a “common ultimate parent company”. This statement is typical of the unsatisfactory history here. It does not show how trade mark rights were apparently bought by Robertson, one of the subsidiaries of Picsa, while the presently opposed application comes to be made by another company entirely, Collair. Mr Wilton’s bland statement “(Collair) was used for the registration of various trade marks as it was planned to transfer the Collair business into this company” (my emphasis) sheds no light on that transfer. It is doubly unsatisfactory that this claim is itself at odds with the assertion made in support of the recordal of the assignment. It will be recalled that a director of Collair has written to the Trade Marks Office on the basis that the owner, prior to transfer to IFE, had indeed been Collair, not Robertson.
Lending some weight to Mr Wilton’s version of events, annexure C to his declaration is an assignment document apparently made out by FMA. Taken at face value, the document would transfer the trade mark to “Collair Equipment”, not to Robertson. It might be permissible to infer that Collair Equipment is a business name that was owned by Robertson. I would then need also to assume that, somehow or other, the trade mark made its way from Robertson to Collair before the critical date.
Over time, as Ms Champion points out, there is scant evidence that Collair has used the trade mark FANMASTER. There is, of course, evidence that entities other than the opponent have been doing so, and these appear (perhaps) to have some corporate connection with Robertson and/or Collair. Ms Thornton, suggested that, again, the opponent’s case would not survive a reality check. As Ms Thornton put it, each and every Australian-made fan sold since the 1940s has had the trade mark on it, up to and including those sold by IFE. Ms Thornton noted, in particular, usage by “Collair Equipment a division of (Robertson)” at annexure R to the second declaration by Garth Bird. These documents appear to be purchase orders relating to various shipments, some with specific reference to the trade mark and to “Australian made product”. There are orders for:
- 10 fans by reference to the trade mark “Fan master” (sic) dated January 19 2006, and
- 20 further fans to the same purchaser, in March 2006
- Subsequently, in July 2006, (after the date of the letter from Mr Broadfoot, about the assignment) there are tax invoices headed “Fanquip”, an entity which apparently has the same ABN as IFE. Payment by cheque made payable to IFE is requested.
The general tenor of this usage appears to be entirely consistent with the earlier use made by FMA and by FMC before it, examples of which are appended to the second Warren declaration.
There was thus usage of the trade mark continuously from a time before any involvement of the opponent, and subsequently, in ways that are consistent, just barely, with Ms Thornton’s view of events. Ms Champion for her part stressed that the purported usage by anyone claiming to be “a division of Robertson” was itself enough to imperil the ownership claim made by Collair at the time of filing. In her view, any trade mark rights formerly resting with FMA were effectively abandoned, since FMA clearly manifested an intention to cease business after the 2002 assignment and has been voluntarily de-registered as a company. The trade mark rights, she argued, were not successfully transferred to Collair, whether via Robertson or otherwise. The rights transferred from FMA either went nowhere or, equally fatal for IFE’s claims, came to rest with Robertson such that they defeated the subsequent claim to ownership asserted by Collair in filing the present application. The only surviving rights as a common law owner would then be those of the opponent, whose rights, in her view, were superior to any that might be asserted by Robertson, and the present application would be open to the opponent’s attack.
The opponent’s case here is simple - “Be it lawful, I take up what’s cast away”[5]. If the opponent can satisfy me that the link in the chain of title claimed to descend from FMA is non-existent, Ms Champion argued that the opponent’s then-superior title based on its own common-law usage would defeat the opposed application. That remains to be seen and perhaps the less now said about the rights and entitlements of the opponent, the better. The opponent had, in my very preliminary view, been authorized to use the trade mark only in a limited way, and for a limited time, on the expectation that he would be buying the relevant business from FMA. It is common ground, from the evidence, that this did not occur. The opponent, to fortify his own position, has made much of the lack of sophistication that was shown by Mr Warren in, among other things, allowing the trade mark registrations to lapse, and in the thoroughly disorganized paperwork surrounding the 2002 assignment. This has been an attempt to exploit discrepancies in Collair’s claim to use and ownership but I am not satisfied that the opponent has been able to establish this ground of opposition. What the entitlements of the opponent may be remains to be determined but such claims as he might have do not supplant the entitlement of IFE to be regarded as the owner of the trade mark by virtue of rights obtained from Barry Warren and FMA.
[5] King Lear, Act I scene I
I accept that there is a divergence of views as to the appropriate interpretation of the documents and events relied upon before me. However, I am not prepared to put telling weight on the discrepancies on which the opponent relied. To suggest that there may be, perhaps, something fundamentally awry to underpin the divergence of views in the documents prepared by Messrs Wilton, Warren and Broadfoot remains, in my view, simply speculation. It may well be that a s 92 application is filed by the opponent to further probe the alleged weaknesses in the claims that use was neither by, nor under the control of, the owner for the time being. That will be a more appropriate way of further reviewing, in detail, the defects to which Ms Champion referred. For present purposes, I am not satisfied that they reflect substance rather than form. I do not find that the ownership ground has been established.
Section 60
Ms Champion argued that, at the priority date, the trade mark rights that might otherwise have passed to IFE had not done so. They were abandoned, she said. The opponent, on the other hand, has been shown by the evidence to have commenced to use its own trade mark (FANMASTER, apparently in various forms, but used in relation to imported fans) under arrangement with Mr Warren. Ms Champion argued that with the abandonment of any other claim the opponent had the only surviving reputation as at the priority date.

For reasons that I have set out above, I have not been convinced by Ms Champion that there has been any such abandonment of rights. The succession in title is, in my view, badly documented but tenable, and the long-standing reputation accrues to IFE, not to the opponent. That being so, this ground of opposition too is not established.
Conclusion and costs
No ground of opposition has been established. The trade mark application may proceed to registration one month from the date of this decision. If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been discontinued or registration is otherwise ordered by the court.
Costs would ordinarily follow the cause but in my view the late introduction of so much additional evidence has disentitled IFE to such an award. I decline to award costs against the opponent.
T. E. Williams
Hearing Officer
Trade Marks Hearings
28 November 2008

[2008] ATMO 96

28 November 2008

Key Legal Topics

Areas of Law

Intellectual Property

Legal Concepts

Appeal

Costs

Standing

Delegate:	Terry Williams
Representation:	Opponent: Camen Champion of counsel, instructed by AU Trademarks Applicant: Josephine Thornton of counsel, instructed by Hunt & Hunt, solicitors
Decision:	2008 ATMO 96 S 52 opposition: s 58 and 60 grounds not established, registration proceeding. Costs not awarded in view late filing of evidence by applicant.