ICI Australia Operations Pty Ltd v Duco-Magic (Australia) Pty Ltd

[1999] ATMO 40

TRADE MARKS ACT 1955
DECISION OF A DELEGATE OF THE REGISTRAR OF
TRADE MARKS, WITH REASONS

Re:Opposition by ICI Australia Operations Pty Ltd to the registration of trade mark application number 591509 in the name of Duco-Magic (Australia) Pty Ltd.

Background:
The Trade Marks Office has examined application 591509 and accepted it for registration.  The applicant is Duco-Magic (Australia) Pty Ltd, which I will refer to simply as “the applicant” from this point.

The mark in question is as follows:

 

and the application covers the service of "automotive paint touch-up processes".

ICI Australia Operations Pty Ltd ("the opponent") opposes registration of the application on various grounds.  The opponent is the owner of the registered trade mark DUCO for, among other things, paints and lacquers.

The opposition process has followed the course set out in the regulations.  The relevant legislation, because of the transitional provisions of part 22 of the Trade MarksAct1995, is the 1955 act and regulations.

Evidence
Both sides served evidence to support their positions. 

The opponent relied on evidence in support and reply: declarations by David Fitzpatrick, Peter Nicholls and Robert Kelson, patent attorneys.  The opponent also relies, in its evidence in support and in reply, on a number of declarations, long and short, from people in what it sees as the relevant trades.  Chief among these are two declarations of William Matthews, Marketing Manager for "the Duco range of products of the Dulux Australia Division" of the opponent.  The latter of these also incorporates evidence given by Mr Matthews in another proceeding in the Trade Marks Office.  Since that evidence is referred to by Mr Matthews, has been properly filed and a copy served on the trade mark applicant, I think I should treat this as being something I must also consider in the present matter.

Broadly speaking, the other trade declarations relied on by the opponent are from those in the trades of panel beating and the sale of automotive paint.  However, three of the trade declarations that make up the evidence in reply are from experienced teachers of automotive painting at Institutes of Technical and Further Education in Victoria.

In answer to the opposition, the applicant relies on the declaration of Peter Fisher, a patent attorney, and two declarations by Warwick Lindsay, the General Manager of the applicant company.  The Fisher declaration incorporates a number of declarations or written statements from people who, in the main, are not panel beaters or spray painters but who appear to have, even so, a loose connection with the sale, cleaning or operation of motor cars.

Additionally, at the hearing, I allowed the applicant special leave to serve further evidence dealing with matters raised by the opponent in the evidence in reply.  My decision was that, while any addition to the ordinary evidence stages needs to be justified, Mr Lindsay's further evidence appeared relevant and credible.  Simple fairness demanded that he be given an opportunity to respond to an issue that emerged in the evidence in reply.  Also, I noted that the opponent had sought to use the evidence in reply stage to deal with matters of argument, not simply for adducing factual evidence to which arguments can be applied at the hearing.  Such a party, having stretched the intent of the evidence-gathering stage, cannot fairly claim that the discretion given to me on questions of further evidence should be applied rigorously to the detriment of its adversary.

At the hearing, the applicant was represented by Peter Fisher, an attorney from the patent attorney firm of Fisher Adams Kelly.  The opponent was represented by Mr Barry Hess of Counsel, instructed by its patent attorneys, Phillips Ormonde & Fitzpatrick. 

Grounds of opposition:
At the hearing, Mr Hess argued that the registration of the trade mark should be denied because of the action of sections 33, 28, 40 and 24-26.  In the alternative, the opponent argues that the registration should be restricted to the Brisbane area because of limited use and in view of the risk of deception or confusion if use commences elsewhere. 

The pivots of its argument are that, because of circumstances in the business of car paint retouching and restoration, the trade mark DUCO so closely resembles the applicant's trade mark that it is either substantially identical or deceptively similar to it.

I will approach the issues in the order in which the opponent argued them.

Section 33
This provides, so far as is relevant, with bolding added to the provision itself for emphasis of the issues, that:

(2) Subject to this Act, a trade mark is not capable of registration by a person in respect of services if it is substantially identical with or deceptively similar to a trade mark which is registered, or is the subject of an application for registration, by another person in respect of the same services, of services of the same description as those services, or of goods that are closely related to those services, unless the date of registration of the first-mentioned trade mark is, or will be, earlier than the date of registration of the second-mentioned trade mark.

The opponent relies on nine trade mark registrations, in a variety of classes.  These consist of the word DUCO, either in plain block letters or as follows:

 

These trade marks all predate the opposed application for the purposes of s 33.  I turn to the remaining questions raised by the sub-section.

Substantially identical trade marks?
Mr Hess noted the general principle in The Shell Co of Australia Ltd v Esso Standard Oil (Aust) Ltd, (1963) 109 CLR 407 at 414 and several other authorities including Seven-Up Co v Bubble Up Co Inc (1985) 9 IPR 259. I believe that the proper approach is the conventional side-by-side comparison called for in the former case. I am simply not convinced by Mr Hess's argument that the word MAGIC in the applicant's mark is either insignificant or an irrelevant or superfluous suffix. I have concluded that the marks are not substantially identical.

Deceptively similar trade marks?

For deceptive similarity, the opponent refers to s6(3):"... a trade mark shall be deemed to be deceptively similar to another trade mark if it so nearly resembles that other trade mark as to be likely to deceive or cause confusion.

Mr Hess relied on long-standing authorities: The Shell Co v Esso Standard Oil (supra); Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536, 538 applying Re Pianotist's Application (1906) 23 RPC 774, 777 and Aristoc Ltd v Rysta Ltd (1945) AC 68, 86; Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641, 648; Coca Cola Coy of Canada Ltd v Pepsi Cola Coy of Canada Ltd (1942) 59 RPC 127, 134; Smith Hayden & Co Ltd's Application (1946) 63 RPC 97; Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592, 608; Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd (1979) RPC 410, 439.

I accept his paraphrase of Evershed J in Smith Hayden (supra): the Registrar must be satisfied that, on the evidence in the opposition, if the opponent uses its marks for the word DUCO in a normal and fair manner for any of the goods covered by the relevant registrations listed, there will be no reasonable likelihood of deception or confusion amongst a substantial number of persons if the applicant uses its mark DUCO MAGIC for the services of the application.

The opponent argues that there is a close relationship between car paint retouching services and the paints with which that service is rendered.  Therefore, submitted Mr Hess, there will readily be deception or confusion as between one mark and another.

Mr Fisher, however, noted one element of the opponent's evidence that, he said, added another dimension to the comparison of the competing marks.  In the Nicholls declaration there is an exhibit, a copy of the 1991 edition of the Macquarie Dictionary, that indicates "duco" to be:

(noun) 1. a type of paint, esp as applied to the body work of a motor vehicle

(transitive verb) 2. to spray or otherwise coat (a vehicle) with duco  [Trademark]

This issue, the meaning of "duco", with or without a capital and in various contexts, is at the heart of this case.  It is necessary to deal with that issue at this point but it is also relevant to section 28, to which I will come below.  To deal with the issue, I need to step back from the technical argument under s 33 and return to the relevant evidence.

Both sides relied on a large number of trade declarations, though I use that term loosely.  Some of the written statements relied on by the applicant and incorporated into the declaration of Mr Lindsay do not meet the requirements for a declaration under the Trade Mark Regulations.  None the less, I can give them some weight as apparently seriously made attempts to set down the beliefs of the writers.  On their own, they would establish little if anything but they are broadly consistent with the Macquarie Dictionary entry, with my own knowledge of the casual use of the word "duco" and with some exhibits to the Lindsay and Matthews declarations, to which I will come below.

These declarations have attracted the criticism of one of the opponent's principal declarants, Mr Matthews.  He is, as I have said, the Marketing Manager for the Duco range of products.  He devotes much of his declaration in reply to raising argument about what he finds to be defects in the applicant's evidence in answer.  He does there the job that would normally be done by a legal representative at the hearing.  Such argument is completely undesirable in what is meant to be a fact-gathering process.  I have already referred to one consequence of this, in that I was prepared to allow the applicant a liberal exercise of my discretion to bring in further evidence.  At the hearing, Mr Fisher was quite critical of the "creative interpretation" adopted by Mr Matthews.

None the less, I accept the central argument raised by Mr Matthews.  The declarants relied on by the applicant are, by and large, those who deal in used cars or in the detailing (cleaning) of them.  Such people, typically, see "duco" as meaning the finished paint of a motor vehicle.  Many of this group are of the view that DUCO used to be, some time ago, a brand of paint.  I do not, however, accept that the limited number of written statements provided by the applicant, prepared as they are under unknown circumstances, provides anything like factual evidence about the majority view of the meaning, if any, of the word.  I do accept, however, that they illustrate one current view that exists in the community.

Mr Fisher sought to minimise the impact of the opponent's trade declarations in support of the opposition.  In them, critical questions are asked about what the declarants would expect the applicant's mark to indicate.  The answers would doubtless have been useful in at least illustrating how some people experienced in the automotive painting business see the matter.   

Mr Fisher argued that the declarants were all too closely associated with the opponent to have a completely uncoloured view.  He was also critical of the structure of the declarations themselves.  I agree with him: the declarations are highly leading.  The critical questions are prefaced, in bold print, by the statements:

DUCO is a registered trade mark for paints, lacquers and like products put out by ICI Australia Operations Pty Ltd (for short, "ICIA")

ICIA's trade mark DUCO has been used for many years for motor vehicle bodywork paint products.

These leading statements mean that I cannot decide how much of the declarants' expressed opinions is their initial and freely formed view and how much comes from assumptions made on the basis of the bold-printed and gratuitous information given to them before they were asked the critical questions.  The last of these critical questions is also open to a second criticism.  It reads as follows, the italics and upper case being as used in the original:

"DUCO paint" is quality controlled by ICIA as owner of the trade mark DUCO.  If a company called DUCO MAGIC (AUSTRALIA) PTY LTD provides "Automotive paint touch-up processes", and, knowing DUCO paint to be of good quality, you engaged that company to touch-up your car, how happy would you feel if you discovered they had used non-genuine "DUCO" paint?

This is completely misleading.  It raises the spectre of the applicant making dishonest statements about the brand of paint actually used in the retouching process.  No other reading will explain the reference to the quality of DUCO paint, followed by a reference to "non-genuine 'DUCO' paint", yet this allegation is at best tangential to the issue said to be addressed by the declarations.

The opponent's trade declarations simply do not help me to decide if there are, among those whom Mr Fisher categorised as "insiders" - ie those with specialist knowledge - people to whom DUCO is or was a brand of paint.  Nor do the declarations help me to know what such people would expect the applicant's mark to indicate.

However, to continue using Mr Fisher's terminology, there are certainly "outsiders" who none the less deal with cars.  To some of those people, duco is the painted surface of a motor vehicle.  There is evidence that the term is very commonly used, by such people and in advertisements of motor vehicles for sale, to indicate simply the painted surface of the car in question.  Even in Mr Matthew's declaration in the non-use matter, one exhibit (WM-10) contains an example of this.  It is a brochure that appeared as an article in a number of car car magazines.  It was formulated, in 1992, with the assistance of Dulux Paint Technical Services:

There it sits, a few car park dings in the doors, a bit of rust in the lower rear quarter panels and a stone pitted bonnet.  The original duco has been buffed and polished to the primer and just won't hold a shine

Consistent with this, Mr Lindsay's declaration exhibits a label from a product branded DUCO WASH.  That product had no connection with the opponent yet appears to have been in use, by direct sale from the manufacturer, to indicate a particular car washing detergent.  I note, however, that the opponent objects to such use, which has now apparently ceased.

Some of the group to whom "duco" means paint finish also know of the opponent's past use of DUCO as a trade mark for liquid paint.  There is no evidence at all that the word "duco" is in use, even loosely, as a generic reference to liquid paint. 

Having established these things, I return to the question, under s 33, of deceptive similarity.  For that purpose, the simple fact is that DUCO is a registered trade mark.  I am therefore required to assume that it is in use.  I must, as Mr Hess argued, assume that the opponent uses its trade mark in ordinary and fair ways for, among other things, automotive paint.  The question is, that being so, what will happen if the applicant makes ordinary and fair use of the registration it now seeks?

From the evidence, there will be many people who will accept that the applicant's DUCO MAGIC services - with or without the logo of the present mark - are simply a restoration service that "works magic" on the duco, the finished paint, of a car or other motor vehicle.  However, I think there must also be allowance, in this notional assessment, for the group of people to whom DUCO is a trade mark for automotive paint. 

To any member of that group, the words DUCO MAGIC, in relation to automotive touch-up process services, would invite an assumption that the paint used was DUCO and that the service was "working magic" through the application of DUCO paint.  On the other hand, as the opponent's evidence has shown, this is a specialised type of painting, needing more knowledge, equipment and attention to detail than would, for example, a house paint.

I appreciate Mr Fisher's argument that, to some of the rest of the community, "duco" is just another word for the paintwork of a car.  I also note that, in eight years of use of the applicant's mark, there is no solid evidence of actual deception or confusion.  That is probably easily explained by the fact that the general public, outside the spray painting and panel beating trades, is armoured by ignorance about the existence of the specialist DUCO trade mark and will not be confused. 

Evidence of confusion, assuming there is some, among experienced panel beaters or spray painters - those who would know of DUCO paints - is not necessarily easy to come by.  In practice, the evidence may never arise.  Mr Fisher argued that those in the trade would not be the ones to use the applicant's services in the first place.  They would be doing the work themselves and therefore any possible confusion caused in that group was less relevant than were the opinions in the actual market, among potential customers.

It was probably to try and assess the opinion of the experienced "insider" group that the opponent designed its trade declarations but, simply because of the defective way in which they are structured, I can give them no weight.  Even so, my conclusion is that specialists, hypothetically knowing of the applicant's services, would draw a wrong conclusion about the existence of a connection with the opponent. 

In saying this, I note that one part of the opponent's evidence that I am able to give weight to does tend to lean in the that direction.  This is the declaration of David Bruckshaw.  Mr Bruckshaw's company is a former associate and franchisee of the applicant.  Mr Bruckshaw's uncontroverted evidence is that, on 29 March 1993, he asked Mr Lindsay "how was his company able to use the DUCO name" and that the reply was that Mr Lindsay had "special permission" to use it - or words to that effect.  Mr Fisher was, at the hearing, quite critical of his evidence.  He pointed out that Mr Bruckshaw now appears to be in business in direct competition with the applicant and that his evidence should therefore be given reduced weight.  As Mr Fisher pointed out, Mr Bruckshaw was still doing business as a franchisee in February 1994, and he is reticent about the full details of the reasons why this has not continued.  His declaration states only that "one of the reasons we severed our relationship with (the applicant) was because we learned that such permission was apparently non-existent". 

I accept Mr Fisher's caution.  I also allow for the fact that Mr Bruckshaw is not precise about the wording used by Mr Lindsay in regard to the alleged "special permission".  However, Mr Lindsay has not refuted any part of the alleged conversation.  On the evidence as it is, therefore, Mr Bruckshaw is someone who was deceived or confused by the similarity between DUCO and the applicant's trade mark. 

I should state for the record that there is no suggestion in the evidence the applicant originally adopted this trade mark with any intention to deceive.  Mr Lindsay was certainly aware, before the application was accepted, that DUCO was a registered trade mark.  The relevant registrations were cited by the examiner at the first report stage.  However, Mr Lindsay has stated that "at no stage, prior to the dispute with ICI Australia Operations Pty Ltd was I aware that DUCO was a registered trade mark".

Mr Hess dwelt on this apparent discrepancy in Mr Lindsay' evidence.  The statement I have just quoted does make sense when I allow for the not unlikely possibility that the opponent may have contacted Mr Lindsay even before the application was accepted.  It is quite possible that a warning was given even before his application was examined, some twelve months after filing, and that "the dispute" began at that time.  Mr Lindsay was possibly somewhat careless, or even uncaring, about any trade mark rights owned by the opponent, or he would have searched the Register of Trade Marks.  For all that, as General Manager and driving force behind the applicant, he was not, in my opinion, acting fraudulently at the time he coined the mark now used by his company. 

Having said that, I must none the less conclude that the trade marks at issue are, because they are likely to deceive or confuse those engaged in or having knowledge of the services of spray painting, deceptively similar.  I therefore move on to consider if the applicant's services are closely related to the goods covered by the opponent's registrations.

Closely related goods and services?

Under this heading, Mr Hess noted the office decision in Re Aussat Pty Ltd (1993) 27 IPR 309 at 311. This, he said, summarised the issues from earlier case law and other sources. The most important issue here was that the opponent's goods would, or could reasonably, be used in delivering the service specified in the application.

The evidence shows that the particular service provided by the applicant is not precisely that of a car respraying business.  The applicant's own service is aimed primarily at used-car yards, and at owners who wish to avoid the delay and expense of respraying small scratches or stone chips.  To that end, the applicant's process uses a device to apply a tiny amount of colour-matched paint to just the area that has been damaged.  Mr Fisher stressed the extent of this difference.  He argued that, as a practical thing, the two markets would not intersect and that the applicant company was simply not part of the conventional automotive spray-painting trade, nor were its customers ordinarily the customers of spray painting businesses. 

However, while that may be so, there does not seem to me to be any way to separate out the applicant's business from the ordinary trade.  This is what the applicant describes, in an exhibit to the Lindsay declaration, as "the old respray way".  The test is, what can the applicant do if it obtains registration?  As matters now stand, a registration would give the applicant rights in respect of "old hat" technology and processes as well as in its present innovative approach.

Accordingly, when I approach this matter, I will need to assume that the norms of the ordinary trade in automotive paint touch-up processes can apply.

Mr Hess laid great stress on the fact that these painting services are rendered using specialised automotive paints.  This is something that was touched on in Aussat, supra.  The Hearing Officer commented, on that issue:

the fact that services are performed by means of goods does not of itself mean that those goods and those services are closely related.  A person employed as a cleaner or a chimney sweep will use brushes and chemicals in the performance of their service; however, the ordinary person would not believe that UNICORN floor or chimney cleaning chemicals (or brushes) and UNICORN OFFICE & CHIMNEY CLEANING services were closely related.  (This is not to suggest, however, that a person adopting the name of a well-known cleaning agent for his or her trade mark in respect of cleaning services would not encounter difficulties: a lawful objection to the adoption of such a mark might well exist elsewhere).

The decision continues with a summary of the issues that now confront me.  The Hearing Officer, Mr Thompson, said:

Just how the question of closely related goods and services is to be assessed has not been the subject of detailed analysis by the courts.  Caterpillar Loader Hire (Holdings) Pty Ltd v Caterpillar Tractor Co (1983) 1 IPR 265 is one case that has been before the courts. Lockhart J. in his decision suggested some examples of 'closely related' goods and services but did not suggest any unifying tests. In American Express Co v N.V. Amev, (1985) AIPC 90-258, the Hearing Officer found that travel services are 'closely related' to printed magazines because the 'free' magazines by which travel agencies promote their business have the look of travel magazines. Finally, in Rowntree PLC v Rollbits Pty Ltd (1988) 10 IPR 539, Needham J. stated that, as Rollbits' goods were 'goods of the same description' as Rowntree's goods, the restaurant and retail food services that Rollbits performed in relation to their goods were 'closely related' to Rowntree's goods.

I believe that the tests must lie in the adoption of criteria similar to those oft quoted from John Crowther & Sons (Milnsbridge) Ltd's Appn (1948) 65 RPC 369 at 372, adopted by
the High Court in Reckitt and Colman (Aust) Ltd v Boden (1945) 70 CLR 84 at 94. I believe that these criteria should include:

·   are the services performed directly upon or by means of the goods? if so,

·   are the goods and services generally regarded by the ordinary consumer as originating in, or being part of, the one industry or trade, or, a closely related trade or industry? 

In consideration of the latter point some guide-lines might be suggested and I stress that these are not in any particular order of priority:

·   are the goods and services of matching technical complexity?

·   is the technical training of the people who make the goods or provide the services the same?

·   do the people who make the goods or provide the services belong to the same unions or associations?

·   are there personnel who are implicit in the provision of the service, or a necessary ancillary to the provision of it, who are viewed by the ordinary person as  having the essential expertise in common to the provision of either the goods or services?  (For example, in "vehicle hire services" and the goods "cars", there are the ancillary personnel common to both, such as car detailers, mechanics, salespersons, credit checkers, and so on which give both the same flavour).

·   do the goods usually have this service as a related service agreement or package?  For instance, it would be most unusual for a person buying a very expensive piece of machinery not to enter some sort of service agreement.  Conversely, are the goods usually offered as part of a service agreement?

·   is the nature of the goods or the service such that they would cease to exist without each other, thus creating an expectation of a common source? (Such as "transportation services" and "vehicles"; or, "vehicle hire services" and "vehicles"; or "restaurant and take-away food services" and "food").

·   does the service consist of altering, matching and/or installing the goods to a customer's or client's requirements? (Such as "curtains and furnishings" and "the sewing of furnishings").  It must be observed that the person doing the service of sewing the furnishings is also exercising the same or very similar skills as were involved in making the curtains.  Also, the installers of domestic and industrial equipment are often employed either directly or indirectly by the manufacturer.

·   are the goods and services commonly offered by the one company or organisation?  (For example, "retail sales" and the equivalent "goods"; or, "telephone communication services" and "telephones").

·   are the goods a necessary adjunct to a particular service or the only tangible result of it?  (For example, "advertising services" and "directories", or "publications"; or, "travel agency services" and "publications"; or "telephony services" and "directories").

He noted, finally, that these tests must be in terms of the ordinary person's perceptions of either of the industries in question.  By this, he meant the ordinary person who was a buyer in either of the industries in question.

In the present case, most of the relevant questions must be answered with a firm "no".  The present case seems to me to be more analogous to that of the chimney sweep, on the one hand, and the chimney sweeping brushes and chemicals on the other.  I conclude that these are not closely related goods and services.

Therefore, I conclude that this ground of opposition has not been established.

Section 28
This section reads:

Scandalous and improper marks

28. A mark-

(a) the use of which would be likely to deceive or cause confusion;

(b) the use of which would be contrary to law;

(c) which comprises or contains scandalous matter; or

(d) which would otherwise be not entitled to protection in a court of justice,

shall not be registered as a trade mark

and the opponent relies initially on s 28(a).

Let me say briefly that the Trade Marks Office applies s 28 in the light of the decision of the Full Federal Court in Nettlefold Advertising Pty Ltd v Nettlefold Signs Pty Ltd [1998] FCA (23 Dec 1998).  Section 28(a) can be applied unfettered, without any reliance on any of the other paragraphs of the section.  While Mr Hess addressed our former practice at the hearing, his submissions have been overtaken by the clear and helpful explanations of Wilcox J and I will make proper allowance for the change in interpretation.

The essential differences between s 28 and the action of s 33, with which I have already dealt, are twofold.  Firstly, s 28 does not stipulate that there must be any particular level of connection between the goods or services of the competing parties.  Section 28(a) is triggered wherever the end result of use of the applicant's mark will, tested at the date of application, be a significant likelihood of deception or confusion.  Secondly, s 28(a) depends on assessment of the actual reputation of the opponent and its trade mark as at the application date.  Notional use of the opponent's registration plays no part in this assessment.

The relevant test is: having regard to the reputation shown to exist in the opponent and its trade marks, will use of the applicant's trade mark, for any of the services specified, be reasonably likely to deceive or cause confusion to a substantial number of people.

I have concluded that, notionally, there are some automotive spray painters who might infer a connection between DUCO and DUCO-MAGIC.  That, of course, was in the context of entirely hypothetical fair use of the opponent's trade mark.  I must now re-do this analysis, taking into account only the reputation that has been established by the opponent.

Mr Hess, in addressing the evidence of reputation, relied on what he said was evidence of a long-standing reputation in the opponent's DUCO trade mark.

He relied on the declared opinions of various spray painters and others with a good knowledge of the supply and application of automotive paint.  I have already said that I am not prepared to give these declarations any weight because of the unsatisfactory way they were constructed.

Mr Hess also relied on two decisions of the Trade Marks Office in which the opponent has been involved.  Nearly ten years ago, it was able to oppose registration of a trade mark consisting of the word DUCO with a car device.  That was in Avirone Pty Ltd v ICI Australia Operations Pty Ltd (1989) 17 IPR 262. The headnote to this decision is in evidence but I do not think I can rely too heavily on the words adopted by the learned editor of the headnote in question. I agreed at the hearing that I am able to consider the views of the registrar's delegate but that I will not have recourse to evidence in that matter.

In addition, the opponent has successfully opposed removal of its own DUCO registrations when they were attacked, by the present applicant, on grounds of non-use.  That was in ICI Australia Operations Pty Ltd v Duco Magic (Australia) Pty Ltd (1998) 40 IPR 35.

In the latter case, the hearing officer was critical of the framing of the evidence.  She found evidence of use of the trade mark DUCO on automotive putty, finishing glaze coatings and tinter for lacquer.  She also noted evidence that the trade mark had previously been well known for what, on the evidence in the current case, was an old-style nitrocellulose lacquer.  There is reference, in her decision, to evidence that suggests the trade mark has been re-launched in relation to the more modern acrylic lacquers, apparently in 1994 or later.  Mr Matthews says so, quite clearly.  That is consistent with the declaration of Fred Amos, a teacher of vehicle painting, whose evidence is a part of the current evidence in reply.  However, of the previous evidence, Hearing Officer Zars has already considered some promotional material in relation to acrylic lacquer.  She concluded that that the material is not supported by "any evidence that such material was distributed for the purpose of actual trade or offer to trade in the goods bearing the mark".  This, in the lack of any evidence of actual sales of acrylic lacquer, fortifies my own conclusion that the opponent in the present matter does not have a significant reputation for a DUCO trade mark that is currently in use on automotive paint. 

However, the opponent does have a significant residual reputation, augmented by use on the particular items referred to by Mrs Zars in the non-use opposition.  I quote the decision on that issue:

Having regard to the above comments and conclusions, it follows that, should the DUCO marks be adopted by any other trader for use in relation to the goods now specified in the opponent's registrations, such an act would likely result in considerable deception or confusion on the part of the prospective buyers of such goods.  For the sake of public interest, therefore, and taking into account the past reputation of the opponent's marks in respect of surface coatings, I have decided to exercise residual discretion in the matter by allowing the opponent's marks to remain registered in respect of all the goods as they are registered.

Similarly, in the Avirone case, supra, Ms Hardie referred to the achieved reputation in DUCO.  I note, however, that at the time of her decision the annual sales of paint bearing the trade mark DUCO were only about 2750 litres per year, whereas thinners bearing the trade mark amounted 1,693,000 litres.  To put the paint volume further into context, the opponent's evidence shows that it takes about four litres of paint to respray a car.  It cannot be said that, even in 1989 when the Avirone evidence was prepared, the opponent's sales of DUCO paint were anything but a shadow of the business that, under other and much better known trade marks, apparently takes in about half of the respray market. 

On the present evidence, the current reputation of the trade mark DUCO is, in relation to paint, more a matter of past reputation.  I have now to decide if that past reputation, plus the evidence of use on automotive putty, finishing glaze coatings and tinter for lacquer, is sufficient, now, to lead anyone, either inside or outside the automotive painting trade, to entertain a reasonable doubt about a connection between the applicant's mark, used for the general run of retouching services, and the opponent.  If there are such people, I must decide if there are a sufficient number of them.

In my opinion, there may be some who would hold such a doubt.  Possibly, they would be what one of the opponent's declarants, Mr Littlejohn, calls "older tradesmen".  While there is otherwise very little evidence that the reputation of the DUCO trade mark has remained current, what there is cannot be disregarded.  When I allow for the fact that the applicant must, if it obtains registration, be granted one that will bring rights in respect of the ordinary work of automotive spray-painting, I believe the risk of an inferred connection exists.  Such people would believe, just as Mr Bruckshaw did, that the name DUCO must indicate a connection with the paints that originate - or originated - from the opponent.  Underpinning all this is the fact that the opponent is itself a well-known supplier of automotive paints, albeit mostly under other trade marks. 

The final question, then, is this: is the number of people who are thus likely to be deceived or confused significant?  The overall market is apparently broad: these services are used by many people who own a car that needs retouching of minor blemishes.  They are also used by car detailers and, in the way the applicant conducts its business, they are sold directly to used-car yards.  Only some of the people in that market - a limited number of informed spray-painters and arguably none of the ultimate customers - will have heard of the opponent's DUCO paint.

The group of specialists who know of the opponent's paint will also be familiar with the other significance of the word "duco" and know that it is quite capable of being used to mean nothing more than the hardened paint of a car or other vehicle.  Many of them will presumbaly allow for this.  That in turn will reduce the number of the "insiders" who will be deceived.  The number who will actually be likely to be deceived or confused is thus a very small proportion of the actual market for these services. 

Accordingly, I dismiss the opposition as it arises under s 28.

Sections 40 and 32 - restricted use
Mr Hess's attack on proprietorship hinged on a claim that the opponent's and applicant's marks are substantially identical.  I have already concluded that the marks in question are not substantially identical.  I will not repeat my reasons for saying that they are not "the same mark" (Hicks' case (1897) 22 VLR 636). Accordingly, the opposition fails under s 40.

I note his fall-back argument, that the applicant's claim to proprietorship was limited to the State of Queensland.  However, I do not accept that the applicant's claim to ownership should be limited by the fact that, so far, it has apparently only sought franchisees in Queensland.  The opponent has not brought in any evidence to suggest that this is anything but a logical step in building up a franchise operation in an industry where skilled use of the applicant's paint application device is the key to successful business.  The opponent has simply not met its evidentiary responsibility in this respect.

Nor do I accept Mr Hess's claim that the trade mark should be made the subject of some sort of disclaimer that would limit rights to the Brisbane metropolitan area.  At the hearing, Mr Hess argued that this question could be dealt with under s 32.  Section 32 is a provision that bestows a wide discretion to impose a disclaimer of part of a trade mark or "such other disclaimer as the Registrar or the prescribed court considers to be proper…".  However, given the failure of the opponent to establish any ground on which I should exercise the discretion, the question of the applicability of s 32 does not arise. 

In my view, the power to require disclaimers of any sort is part of the general discretion that I already have, to require such conditions or limitations as I see fit, under s 50.  Since I have not found there to be any established ground of opposition or any lawful basis for the exercise of that discretion, I will not require any such condition.

Sections 24-26
Mr Hess submitted here that because of other matters previously discussed, the applicant's mark was not capable of becoming distinctive of the applicant's services.  I have already decided against the opponent on those other matters.

Conclusion
I have found that no ground of opposition has been established.  I have also concluded, above, that there is no lawful basis on which I should restrict the area covered by this registration.  I therefore dismiss the opposition and direct that, subject to any appeal from this decision, the application proceeds to registration.

I award costs, in accord with the official scale, to the applicant.

T. Williams
Hearing Officer
29 April 1999.