John Weeks Pty Ltd v Foodland Association Ltd

[1986] FCA 443

Re: JOHN WEEKS PTY. LTD.
And: FOODLAND ASSOCIATED LIMITED; RONALD MULLIGAN; JOSEPH GUIPPA and NEVILLE
GALE
No. WA G50 of 1986
Trade Marks

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Toohey J.

CATCHWORDS

Trade Marks - application under Trade Practices Act to restrain use of name and mark - prior application for removal for non-use pending before Registrar of Trade Marks - application by respondents for stay of Federal Court proceedings until disposal of trade marks application - Federal Court proceedings unlikely to proceed to hearing after resolution of trade marks matter - considerations of time, cost and convenience relevant to question of stay

Trade Marks Act 1955 ss.21, 23(3A)

Trade Marks Regulations Pt VII Div.2

HEARING

PERTH

#DATE 10:10:1986

ORDER

Until further order all proceedings in relation to this application be stayed pending disposal of the first respondent's application dated 25 October 1985 pursuant to sub-s.23(3A) of the Trade Marks Act 1955 that the applicant's trade mark No. B370430 be removed from the Register in respect of all of the services in respect of which it is registered so far as the state of Western Australia is concerned.

Note: Settlement and entry of orders is dealt

with in Order 36 of the Federal Court Rules.

JUDGE1

This is a motion by all respondents seeking an order that proceedings in relation to this application be stayed pending disposal of the first respondent's application under sub-s.23(3A) of the Trade Marks Act 1955 for the removal of the applicant's trade mark No. B370430 from the Register of Trade Marks in respect of all of the services for which it is registered, so far as Western Australia is concerned.

1. The background to this motion is set out in reasons for judgment I delivered on 4 July 1986 and I shall not repeat what is said there, except to the extent that it is necessary for an understanding of the matter now before the Court.

2. The applicant is the registered proprietor of trade mark No. B370430 consisting of the trade mark Bi-Lo registered in Part B of the Register of Trade Marks in respect of retailing through supermarkets, being services included in Class No. 42. Registration of the mark was granted to the applicant on 20 December 1984 and subsists for a period of seven years from 14 January 1982.

3. The applicant was incorporated in South Australia and it has carried on business in that state since May 1979. The first respondent was incorporated in Western Australia and it has registered the name Bi-Lo under the provisions of the Business Names Act 1962 of this state. It has used the name Bi-Lo in the course of its business and it has, by franchise agreements, given the other respondents the right to use that name.

4. The applicant has brought proceedings against the respondents, pursuant to s.52 of the Trade Practices Act 1974, seeking to restrain them from using the name Bi-Lo in their businesses and in particular to restrain them from using the name in the course of trade as a mark.

5. On 25 October 1985 the first respondent lodged with the Registrar of Trade Marks an application under sub-s.23 of the Trade Marks Act 1955 for an order that the mark be removed from the register in respect of all of the services for which it is registered "in so far as the State of Western Australia is concerned". The basis of the application was that the first respondent had been the proprietor of the business name Bi-Lo since 1 February 1980 and that the applicant had never used the mark Bi-Lo in Western Australia. On 16 April 1986 the applicant lodged notice of opposition to the application by the first respondent, contending that the mark had been used by it since May 1979 and that extensive good-will attached to the trade mark and to the applicant's reputation in the name Bi-Lo throughout Australia.

6. When this matter was last before the Court, counsel for the parties joined in inviting the Court to order removal of the trade marks application to this Court. I had doubts as to my power to make such an order and reserved my decision to consider this aspect. The question of a stay was put to one side until that question had been resolved. For reasons that appear in my earlier judgment, I concluded that the Court had no power to direct the Registrar to refer the proceedings before him to this Court, though the Court might entertain by way of cross-claim a claim by the respondents or any of them to remove the applicant's trade mark from the Register.

7. The respondents' argument was along these lines. The existence of a registered trade mark is central to the applicant's case in the Federal Court. If the first respondent succeeds in its application to the Registrar and becomes the registered proprietor of the trade mark Bi-Lo, the applicant's case in this Court is for all practical purposes at an end. The applicant does not trade in Western Australia, makes no claim to a reputation in this state and does not assert in its statement of claim that the respondents have passed off their businesses or their goods as those of the applicant. The first respondent applied under s.23 of the Trade Marks Act about seven months before the applicant instituted proceedings in this Court. Indeed, those proceedings were not begun until, in terms of Div. 2 of Pt VII of the Trade Marks Regulations, the time had arrived for the applicant to serve its evidence in answer to the first respondent's application to the Registrar. The period of three months in which to do this has expired though, with the consent of the first respondent, the period has been extended for a further three months until 5 November 1986. Even now the applicant has lodged no evidence in support of its opposition to the first respondent's application to the Registrar.

8. In making its application to the Registrar, the first respondent relied upon the ground in para.(b) of sub-s.23(1) of the Trade Marks Act that,
   
   

"up to 1 month before the date of the application, a continuous period of not less than 3 years had elapsed during which the trade mark was a registered trade mark and during which there was no use in good faith of the trade mark in relation to those goods or services by the registered proprietor or a registered user of the trade mark for the time being".

In that regard, the material date for determining whether the mark has been a registered trade mark for the three year period is the date of the application for registration. Hunter Douglas Australia Pty. Ltd. v. Perma Blinds (1970) 44 ALJR 257. The operation of the period of one month is clear enough when there is an application to the Registrar. What is the relevant commencing date if a claim is made in this Court for removal of a trade mark? In Brown v. S. Smith & Son Pty. Ltd. (1985) 60 ALR 431 Neaves J. held that "an application made to the court under s.23(1) for the removal of a trade mark from the register can only succeed if non-use is shown during the period terminating one month before the date upon which the application was made to the court" (at 436). That matter was not argued before me but, conscious of the decision by Neaves J., the first respondent is anxious to press its application before the Registrar rather than proceed by way of cross-claim in this Court.

1. The respondents argued that a stay of proceedings in this Court would not work any disadvantage to the applicant, particularly as no interlocutory injunction had been sought. Furthermore, the respondents contended, the first respondent had done all within its power to prosecute its application before the Registrar and it was the failure of the applicant to serve its evidence in opposition that had prevented the application being heard.

2. While denying that it had been guilty of any deliberate delay in the proceedings under the Trade Marks Act, the applicant did not take serious issue with the respondents' submissions. Rather, its case was that it had begun proceedings in the Federal Court and ought to be allowed to prosecute those proceedings. It was uncertain when the application to the Registrar would be heard, so that a stay of proceedings in this Court until disposal of the trade marks application might lead to a substantial delay in the prosecution of the applicant's claim. It submitted that it was premature to grant a stay and that its application should be allowed to proceed to a directions hearing and thereafter, at least until it was known when the application to the Registrar would be dealt with. It might then be appropriate, depending on how far the application in the Federal Court had progressed, to order a stay.

3. In my view there should be a stay of proceedings in this Court though not in the absolute terms sought by the respondents. Once the applicant meets its obligations under the Trade Marks Regulations, the way is open for a hearing by the Registrar. The only evidence I have as to when such a hearing might take place is in para.8 of the affidavit of David Roy Fawcett filed in support of the respondent's motion in which it is said:
   
   

"I understand that, subject to the within Applicant filing and serving its Evidence in Answer promptly, those proceedings can, within a matter of weeks, be completed to a stage of being ready for hearing".

It is true that Mr. Fawcett's affidavit was sworn on 10 June 1986 but the applicant did not offer any evidence to suggest that this estimate was no longer realistic or indeed that it was inaccurate at the time it was given.

1. If the matter does proceed in this Court, there is a real possibility that a great deal of unnecessary time and expense will be incurred. If the first respondent is successful in its application to the Registrar, it is unlikely that the application in this Court will continue. If the first respondent is unsuccessful, it is unlikely to mount a substantial defence to the applicant's claim in this Court. Considerations of time, cost and convenience all weigh heavily in favour of granting a stay.

2. The Federal Court has from time to time considered the principles according to which it will stay its own proceedings. See in particular Hughes Motor Service Pty. Ltd. v. Wang Computer Pty. Ltd. (1978) 35 FLR 346; Muller v. Fencott (1981) 53 FLR sureway Stores Pty. Ltd. v. Yorke (1982) 59 FLR 222. Those decisions were given in a context in which there were proceedings on foot in a Supreme Court as well as in the Federal Court. In Muller v. Fencott at 188 I said:
   
   

"... It seems to me that to justify a stay of proceedings in the Federal Court, the respondents must at least show that the Supreme Court is a forum to whose jurisdiction they are amenable, in which justice can be done at substantially less inconvenience and expense and that a stay will not deprive the applicants of a legitimate personal or juridical advantage available to them in the Federal Court".

1. Those principles are not entirely apposite in the present case. The application to the Registrar is necessarily limited in its scope though, as indicated earlier, it may have wider practical consequences. The question here is a narrower one - should this Court stay its own proceedings for a limited time, having regard to the implications that a decision by the Registrar may have for the continuance of the application in this Court? Matters such as amenability to jurisdiction and deprivation of personal or juridical advantages do not arise. The matter, I think, is to be determined having regard to considerations of time, cost and convenience which, as I have already indicated, warrant a stay.

2. I do not think that a stay should be, without qualification, until disposal of the application under the Trade Marks Act. It may prove to be the case that the Registrar is unable to deal with that application for some months and the applicant should not be held out of any rights it may have under the Trade Practices Act indefinitely. These matters can be accommodated by an order in the following terms:
   
   

"That until further order all proceedings in relation to this application be stayed pending disposal of the first respondent's application dated 25 October 1985 pursuant to sub-s.23(3A) of the Trade Marks Act 1955 that the applicant's trade mark No. B370430 be removed from the Register in respect of all of the services in respect of which it is registered so far as the state of Western Australia is concerned".

1. I shall hear from counsel on the question of costs.