Luna Park Reserve Trust v Promenade Investments Pty Limited

[1993] ATMO 102

TRADE MARKS ACT 1955

REASONS FOR A DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS

Re:Opposition by PROMENADE INVESTMENTS PTY LIMITED to an application under section 23 of the Act by LUNA PARK RESERVE TRUST to remove trade mark registration number B333014 from the Register

An application under s.23 of the Act to remove trade mark registration number B333014 from the Register was lodged on 23 December 1991 by LUNA PARK RESERVE TRUST (the Trust). The application was opposed on 12 June 1992 by the registered proprietor of the mark, PROMENADE INVESTMENTS PTY LIMITED (Promenade). The mark comprises the words LUNA PARK and is registered for "Entertainment services" in Class 41.

The grounds relied upon by the Trust are as follows:

"That up to one month before the date of this application, a continuous period of not less than three years has 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 services by the registered proprietor or a registered user for the time being."

The grounds of Promenade's opposition are as follows:

(a)The Trust does not have standing to apply for an order under Section 23 of the Trade Marks Act 1955 ("the Act") as the Trust is not "a person aggrieved" by the registration of the Trade Mark.

(b).Up to one month before the date of the Application there had not elapsed a continuous period of not less than three years during which there had not been any use in good faith of the Trade Mark in relation to the services in respect of which the Trade Mark is registered by the registered proprietor or a registered user of the Trade Mark for the time being.

(c).Alternatively to (b) above, if there has been a failure to use the Trade Mark during the period referred to in (b) above, (which is denied), such failure was due to special circumstances in the trade; namely the termination of the sub-lease of the property on which the amusement park formerly known as "Luna Park" was conducted and the vesting of that property in the Crown pursuant to the Luna Park Site Act, 1990 (NSW), and not to an intention not to use or to abandon the Trade Mark in relation to the goods or services to which the Application relates.

Lodgment of the Trust's evidence in support was completed on 9 July 1992.  This evidence comprised Statutory Declarations by:

Derek Alexander Sinclair and exhibits A to D of 7 July 1992 (first Sinclair declaration)

Desmond Thomas Wittingslow Jnr
  John Martin Phelan
  Peter Albert Johnstone

Promenade's evidence in answer was completely lodged by 24 November 1992 and comprised Statutory Declarations by:

David Zalmon Baffsky and Exhibits A to I of 9 October 1992 (first Baffsky declaration)

Mark Leigh Bouris and Exhibit A
  John Anthony Jeans and Exhibits A to D

David Zalmon Baffsky and Exhibits A to L of 13 November 1992 (second Baffsky declaration)

The evidence in reply from the Trust was lodged on 25 May 1993 and comprised a Statutory Declaration by:

Derek Alexander Sinclair of 21 May 1993 (second Sinclair declaration)

The Trust subsequently applied for a hearing and the matter came before me, as the Registrar's delegate, in Canberra on 22 July 1993.  Representing the Trust was Mr A.J.L. Bannon of Counsel instructed by H.R.Hodgkinson & Co, patent and trade mark attorneys of Sydney.  Appearing for Promenade was Mr J. Allsop of Counsel instructed by Webeck Farland Pender, solicitors and notaries of Sydney.

Submissions

At the hearing, Mr Allsop sought leave to present further evidence in the matter in the form of Statutory Declarations by Robert Bruce Henry Schneider and Robert Valentino Gasparotto and copies of Certificates of Incorporation on Change of Name of Company. Mr Bannon said he would not object to these being added to Promenade's evidence as this would delay proceedings. However, he said that, in the course of his submissions, he would be alleging that some of the assertions made in the Gasparotto declaration, as they related to other material, did not amount to reliable evidence. I granted leave for the evidence to be lodged and the substantive matter of the opposition to the application under s.23 proceeded.

Mr Bannon began his submissions on behalf of the Trust by outlining the history of the registration and the subsequent application for its removal under section 23, submitting that there had been no use of the mark during the critical period for section 23 purposes - 23 November 1988 to 23 November 1991. He cited passages from an interim award of compensation made by Sir Laurence Street following his arbitration between Promenade and the New South Wales Government (the Government) regarding the lease of the well known amusement park site where the mark in question was used by Promenade and its predecessors (the Luna Park site). He traced the history of the dispute between those parties which included, inter alia, Promenade's failure to comply with a notice to re-open the Luna Park site by 1 June 1990 and a dispute over land use following the coming into force of the Luna Park Site Bill on 12 October 1990.  He said that the amusement park at the Luna Park site had closed in April 1988 and, due to a catalogue of delays, including the discovery of asbestos in buildings at the site and consequent union intervention, it had never re-opened.

Mr Bannon commented on the evidence lodged by Promenade, saying that it was deficient in several aspects in showing that the mark had been used in the critical period. He said that the mark was registered for "Entertainment services" and use during the period in question must have involved the actual provision of those services to qualify as valid use under s23. If Promenade had used the mark during the s.23 period, it was not in connection with the provision of "entertainment". As no such services had been provided, it follows that the mark had not been used for the purposes of trade in the present matter. For support here he referred to the decision of Hearing Officer Homann in Sitmar Cruises Ltd v Carnival Cruise Lines Inc AIPC (1992) 90-939 where there was an offer to trade in certain services but they were not provided in Australia.  According to the first Baffsky declaration, the Luna Park site was closed on 10 April 1988 for the purposes of redevelopment - although this did not preclude the continued provision of entertainment services.  The famous "Luna Park face" had remained in place for some of the critical period and, if the words comprising the present mark were used as part of that landmark , it was only as an identification of the site.  The site had never reopened for trade, although Mr Baffsky, a director of Promenade, did claim some use of the mark by that company during April and May 1990.  However, this was only in connection with site preparation, and the contacting and booking of entertainment providers.  According to the Gasparotto declaration, Promenade had itself used and made available for hire, a pontoon called the Harbour Queen beside the site for private functions - although when and how this occurred is unclear. In any case, this offer for rent was not use of the services as registered.. Mr Bannon said that there was no evidence on paper of such hirings and any stationery, such as "With Compliments" slips issued by Promenade showing the mark, was used as an indication of site only. The only entrance to the site itself had been boarded up, clearly denying access to the entertainment park. After the critical period, the mark had apparently been used, for the appropriate services, at an amusement park called Magic Kingdom at Lansvale, NSW but this use was too late for the purposes of s.23. It was not enough that there be an intention to use the mark on the services; those services must be available for trade.  Mr Bannon referred here to page 28 of the text, Australian Law of Trade marks and Passing Off (Second Edition) by D.R.Shanahan which encapsulated the notions of trade and goodwill.  He particularly referred to the positions reached by Falconer J in referring to the Hermes trade mark, (1982) RPC 425, and Deane J in the Moorgate case, supra, with respect to the advertisement of goods (and services) for the purpose of immediately offering to trade.  Here , despite the use of the mark in a development proposal, there was not an offer of entertainment services and the proposal was not intended to be seen by the public.  Its use on "With Compliments" slips in connection with the Harbour Queen was not use on the services in question but use in relation to boat rental, leasing of real estate or catering.  The words in the mark on the Luna Park face did not qualify as use either, as such a notice appeared to offer custom and, at the same time - by virtue of the site being boarded up - denied it.

Mr Bannon said that any claim of an inability to use the mark because of "special circumstances" as envisaged by sub-section 23(4) was baseless, as such "special circumstances" must refer to the trade as a whole - not just to Promenade's difficulties alone. This was clearly not the case in the present situation. The problems occasioned by the unavailability of the site, or because of the Luna Park Site Act 1990 (NSW), did not preclude use of the mark for the services as registered elsewhere. This was evident from the belated licensing action taken to establish "Luna Park at Magic Kingdom". Mr Baffsky's declaration only referred to the special circumstances of the passing of the Act and did not mention any difficulties in dealing with the Government or the arbitration which had taken place. He said in his declaration that it was not possible for Promenade to operate an amusement park using the mark on that site. There was no mention of why it took so long to commence discussions regarding the licensing of the mark at Magic Kingdom. There had certainly been no mention of any "special circumstances" which had delayed such action. Additionally, there had been no explanation offered as to why Promenade had closed the Luna Park site in April 1988. Promenade had voluntarily not employed the mark after that date and before that of the passing of the Act which it claimed comprised the "special circumstances" which prevented use.

With respect to the exercise the Registrar's discretion as to whether or not to remove the mark from the Register, Mr Bannon said that the cases where this had been considered included the Hermes case, supra, Paragon Shoes Pty Ltd v Paragini Distributors (NSW) Pty Ltd (1988)13 IPR 323; and Pacific Dunlop v Gunn & Moore Ltd 25 IPR 329. In the present case, what seems to be relied upon was the general assertion of an intent to use the mark during the critical period although no use actually occurred. Promenade had not been delayed in using the mark by negotiations with government, arbitration or asbestos related matters but had clearly obtained the Luna Park site for commercial development and, after closing down the fun park on its own accord, had not used the mark whilst it pursued this aim. It had also claimed that it had promoted use of the mark by simply erecting a sign saying the park was closed. Later, it had expressed an intent to use it by seeking a licensee. Several of the declarants relied upon by Promenade claim that the company made attempts to organise use of the mark by that means. However, this use did not take place until after the s.23 period had expired. The use of the mark which eventuated was token and was apparently used in the form, "Luna Park in the West" or "Luna Park at Magic Kingdom". He said that the public could be deceived by the mark's use in this different form and referred to the words of Woodward J in the Paragon Shoes case, supra, regarding the importance of the public interest in removing marks from the Register which were likely to deceive.  In all the case law where the Registrar's discretion had been exercised in favour of the registered proprietor to not remove marks, there had been some use during the critical period, albeit not always by the proprietor itself.  This was not the case in the present instance.  He said that there was no reason here why the mark should not be removed from the Register on the grounds of non-use.

In reply, Mr Allsop pointed to the fact that Promenade had used the mark at the Luna Park site under various names and on the appropriate services from the date the mark's assignment in 1987 until April 1988 when the site was closed.  The site at Milson's Point had been used for that purpose for many years prior to that time and had become an icon of Sydney and the harbour.  He said that the mark was registered in Part B for entertainment services in New South Wales not merely the site at Milson's Point. There may have been some combining in the public mind of the geographical place and the mark itself but the trade mark was granted under Commonwealth law for use in the wider area of the State and the Trust bore the onus of proving non-use throughout that area for the s.23 period. He referred to the interim award made by the arbitrator, Sir Laurence Street, where he awarded compensation to Promenade to be paid by the Government relating to the determination of its lease and the vesting of the Luna Park site in the Crown under the Luna Park Site Act 1990. In his award, Sir Laurence had outlined the history of the events which led to the current situation. Following the closure of the Luna Park site in 1988, there had been a long period of negotiations between Promenade and the Government, the parent of the Trust, regarding the lease and the future of the site. He said that the Government had acquiesced in the continued closure of the site while discussions took place on those matters. In September 1989, the Government wrote to Promenade giving the company a period of nine months within which the site was to be reopened as a fun park. Promenade was unable to comply with this demand, mainly because of the continuing negotiations which considered the possibility of total redevelopment of the site. This made proceeding with the reopening of the fun park at that time commercially impractical. This was exacerbated by the discovery of asbestos on the site, with attendant union problems precluding demolition and rebuilding. The Government had then legislated Promenade out of the site in October 1990 with the introduction of the Luna Park Site Act 1990. An arbitrator was given the task of determining any compensation payable to Promenade and Sir Laurence Street's award was handed down in October 1991. Negotiations then took place to relocate the Luna Park operations at Magic Kingdom and so use the mark under licence for the appropriate services.

Mr Allsop said that what had effectively happened was that the Government had taken the Milson's Point site away from Promenade, had paid it compensation for this and now sought to have the mark removed from the Register on the grounds of non-use.  It was up to the Trust to prove that Promenade had not used the mark in good faith during the critical period.  He contended that the evidence showed that use had occurred in the form of signs at the site, Luna Park stationery issued by Promenade in relation to certain activities on the site and a detailed development proposal prepared on behalf of Promenade.

According to the Gasparotto declaration, the towers and face comprising the Luna Park sign had been damaged and replaced by a sign in around December 1988.  This sign advised that these landmarks would be re-erected as the new entrance to Luna Park once re-development negotiations had been completed.  This action served to say that, not only did the words Luna Park refer to a location but they also identified the relationship of the fun park to Promenade - then known as Luna Park Investments Pty Ltd.  Thus the sign indicated to its readers that the entertainment services had been provided there and would be again in the future.  There was no requirement that the public had to associate the mark with a particular identity but merely with the services that had been, and would again be, offered.  This was use of the mark in a bona fide sense.  Mr Allsop referred here to Johnson and Johnson Australia Pty Ltd v SterlingPharmaceuticals Pty Ltd 21 IPR 1 (the Caplets case) where the majority of judges had held that a mark could serve as a trade mark even if it is also used to describe the goods in some way.  Here, the trading channel was still open and the goodwill was still present even though trading was not actively occurring.  Although, in the case of Moorgate Tobacco Co Ltd v Philip Morris Ltd (1984) 156 CLR 414 the matter in question was one of proprietorship and not non-use, Deane J said that even slight use would suffice to protect the owner of a mark from challenge as to ownership. He said that a development proposal for the Luna Park site carrying the mark on the cover and face page produced on behalf of Promenade was another example of use of the mark within the period. This publication had a dual purpose: firstly as a proposal and secondly as a representation of the mark alluding to the owner. Its utilitarian nature did not preclude its use as a trade mark: Thunderbird Trade Mark 131 CLR 592.

With respect to the mark's use on stationery used by Promenade, Mr Allsop pointed to the "With Compliments" slip issued by Promenade under the name, Luna Park Investments Pty Ltd, which he said identified the proprietor and the services it offered.  The mark was also used on cheques issued by Promenade to the same effect.  He said that such use connected the mark not only to the site but what went on there.  Additionally, the Harbour Queen was hired to other persons during the period although the evidence was not easily obtainable with respect to the attendant paperwork.

Mr Allsop pointed to pages 282 to 284 of Shanahan's book with regards to what constituted "special circumstances" as contemplated in s.23(4) and also Columbia Gramophone Co Ltd's Trade Mark (1932) 49 RPC 621 for general points made by the court in that respect. He said that special circumstances which prevented use by the proprietor need not cover the full period in question and also that use of the mark for that time did need to be continuous. He contended that if, for example, Promenade had wished to use the mark at a particular time and was not able to because of intervening circumstances, then this was sufficient. Asbestos had been discovered at the site, the Government had essentially deprived Promenade of the land at Milson's Point and a year had been lost in litigation over compensation. The problems faced by Promenade, taken together, constituted special circumstances which precluded use. Mr Allsop said that use of the mark on another park was possible but, in a practical sense, was very difficult.

On whether the Registrar's discretion should be exercised in favour of Promenade in allowing the mark to stay on the Register, Mr Allsop said that the principal consideration should be the public interest.  Sir Laurence Street's award had made it plain that, in a commercial sense, Promenade had been treated unfairly by the Government, the parent of the Trust.  Promenade owned a trade mark which was not limited to the site, the site had been taken away by an Act of Parliament and it had then been alleged that use of the mark elsewhere was confusing.  He said that there were many factors which had contributed to the alleged non-use, some of which involved commercial considerations but mostly the reasons for this situation had been caused by the "shabby" behaviour of the Government.  None of the alleged confusion generated by the resumption of the land at the Luna Park site had been caused by Promenade.  He said that, despite the Trust alleging it was concerned with the public interest, the current dispute was only serving the interest of the Trust.  There was, he said, an overwhelming case for the mark to remain in the possession of the current registered proprietor.

Decision

Person aggrieved

The threshold question which needs to be asked in a matter of an application under s.23 for removal of a registered mark is whether the applicant is a "person aggrieved" in terms of that section of the Act. This point was not argued at the hearing despite it being raised as one of the reasons for objection. However, I am satisfied that the Trust is such an entity by virtue of its being the applicant for registration of several trade marks against which the present mark owned by Promenade has been cited as a bar to registration: Ritz Hotel Ltd v Charles of the Ritz & Anor (1988) 12 IPR 417 at 454.

Onus

It is well established that the onus of proof of the non-use of a trade mark rests with the applicant for removal: Estex Clothing Manufacturers Pty Limited v Ellis & Goldstein Limited (1967) 116 CLR 254 per Windeyer J at 258:

It is for the applicant who seeks to have a mark removed to prove his case.  The onus is on him to show an absence of use in good faith during the period. ... slight evidence may suffice at this stage for the applicant has the task of proving a negative ... but ... when all the evidence is complete, the question is still, has the applicant proved his case?

It is a matter of public record that the Luna Park site closed on 10 April 1988 and did not reopen to offer fun park style entertainment - for reasons which form part of the dispute between the parties - during the period applied for under s.23 as being the critical period of non-use - 23 November 1988 to 23 November 1991. The Sinclair declaration in support of the s.23 application and the annexed Interim Award by Sir Laurence Street, together, give an historical account of the factors which were involved. These include the acquisition of the park's lease by Promenade in December 1987; its subsequent closure in April 1988; the negotiations between Promenade and the Government regarding possible development, the future of operations at the site and the terms of the lease; the instructions by the Government to Promenade to reopen the park by 1 June 1990; a notice from the Building Workers Industrial Union on 17 May 1990 stopping work on demolition and rebuilding due to the discovery of asbestos in buildings at the site; the introduction of the Luna Park Site Bill in June 1990 - "An Act to return the Luna Park site to the people of New South Wales..."; and the re- commencement of the use of the mark at Lansvale at the Magic Kingdom amusement park in around December 1991 or January 1992.

Up until the mark made an appearance at the Magic Kingdom park - the date of first use at that site I note here to be after the s.23 period had expired - any use of the Luna Park mark was linked to the site at Milson's Point. This was despite the fact that registration of the mark for "entertainment services" was restricted to the wider area of New South Wales. Supporting declarants for the Trust attest to the mark's non-use for such services at any site in New South Wales during the critical period. I am therefore satisfied that the Trust has satisfactorily made out such a case for Promenade to answer in terms of paragraph 23(1)(b).

The onus in the matter therefore shifts to Promenade to demonstrate that it has used its mark in conjunction with the appropriate services during the specified period or that there are grounds for the favourable exercise of the Registrar's discretion under s.23 on the grounds that special circumstances prevented it from using it, despite a bona fide intention to do so. To do this, I turn to the arguments put forward by Mr Allsop at the hearing and the evidence in answer submitted by Promenade.

Use

Under s.23, the thing which must be used is a trade mark, and that term is defined in section 6(1) of the Act as:

(a) except in relation to Part XI, a mark used or proposed to be used in relation to goods or services for the purpose of indicating, or so as to indicate, a connexion in the course of trade between the goods or services and a person who has the right, either as proprietor or as registered user, to use the mark, whether with or without an indication of the identity of that person;

The foregoing must be taken in context with the comments of the High Court in Moorgate Tobacco, supra:

The cases establish that it is not necessary that there be an actual dealing in goods bearing the trade mark before there can be a local use of the mark as a trade mark.  It may suffice that imported goods which have not actually reached Australia have been offered for sale in Australia under the mark (Re Registered Trade Mark "Yanx"; Ex parte Amalgamated Tobacco Corporation Ltd, supra, at 204-5) or that the mark has been used in an advertisement of the goods in the course of trade (Shell Co of Australia v Esso Standard Oil (Australia) Ltd, 109 CLR 407 at 422). In such cases, however, it is possible to identify an actual trade or offer to trade in the goods bearing the mark in trade.

Again, McGarvie J said in Settef S.p.A. v Riv-Oland Marble Co (Vic) Pty Ltd (10 IPR 402 at 417):

[A] mark is used as a trade mark only if it is used with a view to facilitating or promoting the operation of a trading channel which in a business sense had already been opened in Australia.  The mark must be used for the purpose of trade: WD & HO Wills (Australia) Ltd v Rothmans Ltd (1956) 94 CLR 182 at 191. The forwarding of samples and brochures is not sufficient to indicate that Settef was ready and willing to fulfil such orders as it received from Australia.

Further, the High Court has made it clear that the finding of trade mark use is a matter of context.  In the case of The Shell Co of Australia v Esso Standard Oil (Australia) Ltd, 109 CLR 407, Kitto J., with the concurrence of the other members of the Full High Court, found at pp 425 to 426 that the context in which a particular use of an animated oil drop was used precluded a finding that there was use as a trade mark - "Did they appear to be thrown on to the screen as being marks for distinguishing Shell petrol from other petrol?". This can only be decided by making inferences about how a particular advertisement or whatever would be perceived, and Kitto J. referred to the cases of J. B. Stone and Co v Steelace Manufacturing Co Ltd. (46 RPC 406) and the Yeast Vite Case (50 RPC 139, 51 RPC 110) as giving examples of similar conclusions under English law. He described the latter as "a striking example of a context precluding a conclusion that a use complained of as an infringement was use as a trade mark". He went on to refer to Edward Young and Co Ltd v Grierson Oldham and Co Ltd 41 RPC 548 as an appropriate example of how the "purpose and nature" of the use must be considered.

The above means then, that the use to be established must be use which, on an objective test, is as a badge of origin.  This is illustrated in the Caplets case, supra, to which Mr Allsop referred me.

The Luna Park site closed in April 1988 and from that date on there were no appropriate services available to be provided there. There were significant problems precluding use of the site which included the Government's introduction of an Act which made Promenade's occupation untenable; a development proposal which would have meant the provision of fun park services could have been years away, if ever; the instability of the sea wall facing the harbour meaning replacement or substantial refurbishment was necessary; and the discovery of asbestos with consequent union problems. I would have thought that a trade mark proprietor, keen to use his mark so as not to expose it to a s.23 application for removal would have taken earlier action to utilise it somewhere in New South Wales, the area for which it was registered, during that period. I agree that public perception linked the mark to the Milson's Point site but the speed with which the mark was eventually licensed, used and presumably accepted by fun park devotees at magic Kingdom - outside the required period of use - demonstrates that the difficult can become possible when it comes to the provision of entertainment.

I do not regard the hiring of the Harbour Queen pontoon as use of the Luna Park trade mark for entertainment services. The services offered in the hiring of that venue were described in the Gasparotto declaration as use as a "function room" which could perhaps fall under "boat rental" in Class 39, "leasing of real estate" in Class 36 or perhaps "catering" in Class 42. However, there was no suggestion in the evidence, or by Mr Allsop at the hearing, that entertainment was provided by Promenade when the pontoon was used as a function room and such hirings cannot be regarded as "entertainment services" for purposes of s.23 use. Additionally, the "With Compliments" slips and other stationery used in conjunction with this enterprise do not indicate exactly what services are being offered, despite the presence of the words, LUNA PARK.

The other claim of use of the mark was made by Mr Allsop with respect to the sign erected in place of the Luna Park Face which had been damaged by winds.  It read:

The Luna Park Face and towers have been temporarily taken down as a safety precaution.  The face will be restored and re-erected on the same site it previously occupied as part of a new entrance to Luna Park once negotiations with the State Government for the development of the Luna Park Site have been determined.

Management

Luna Park Investments Pty Limited

Whilst I appreciate that this sign provided information on the location and fate of the face, I cannot accept that this amounted to an offer to trade. The entrance to the fun park was boarded up, denying entrance and Promenade had commenced negotiations with the State Government on the future of the site. It could not have been certain of the outcome of that process as to when any entertainment services could again be offered. The proposal put forward by Promenade in August 1989 regarding use of the site appears to have been an ambitious plan to exploit the area of the fun park with extensive commercial development but including some elements of the old Luna Park. However, Promenade could not have been certain of the Government's approval of such a plan, especially taking into account the extensive negotiations which had been taking place with the Government, the notice to comply with the terms of the lease within 9 months dated 1 September 1989 and the Luna Park Site Act 1990 which terminated the lease of the site. I believe that these factors, combined, meant that the likelihood of the provision of required services at the site was a long time away - if ever -and that "some degree of immediacy" of intended use is required for the purposes of successfully defending an application under s.23: see Shanahan's text p.18 and Neuchatel Asphalte Co Ltd's Appn (1913) 30 RPC 349 at 358. I therefore believe that, for all the reasons listed, Promenade made no use of the trade mark in respect of "entertainment services" during the s.23 period.

Special Circumstances

I have considered the arguments advanced by both sides as to whether or not the non-use of the mark at the Luna Park site for entertainment services could be covered by the "special circumstances" provisions contemplated by s.23(4) of the Act. This reads, in part, that the circumstances relied upon which precluded use of the mark must be,

"...shown to have been due to special circumstances in the trade and not to an intention not to use or to abandon the trade mark in relation to the goods or services to which the application relates."

In the case of Aktiebolaget Manus v R.J.Fulwood and Bland Ltd (1949) 66 RPC 71, Lord Evershed rejected the proposition postulated by Sargent J in Crean's case 38 RPC 155, that in order to get within s.26(3) of the UK Act (the equivalent of s23(4) of the Australian Act), the non-user must be due to circumstances affecting the whole of the trade and not to special circumstances attaching to and belonging to the trader personally. At page 79 of the Manus case, supra, Lord Evershed said:

"It is, I think, clear that the words 'the trade' in the sub‑

section must mean the trade in which the proprietor is engaged.  I should therefore in the present case be disposed to define 'the trade' as meaning that of foreign manufacturers of milking machines dealt in on the English market.  But even if the word be extended so as to comprise also English manufacturers I am unable to accept the defendant's argument: for though the phrase in question may or may not be apt to cover the case of a calamity suffered exclusively by a particular trader ‑ eg. if his factory were destroyed by fire or bombs ‑ it is not in my view necessary that special circumstances should be such as to afflict all traders equally or indeed to afflict all of them at all.  It is important to my mind to note that the relevant phrase is used in contrast to that which immediately follows ‑ 'and not to any intention not to use or abandon the trade mark'.  In that context it seems to me (without attempting any precise definition) that the words must be taken to refer to circumstances which are 'special' in the sense of being peculiar or abnormal and which are experienced by persons engaged in a particular trade as the result of the working of some external forces as distinct from the voluntary acts of any individual trader.  According to such a test no less than (in my view) the ordinary and commonsense meaning of the words the impact of war conditions making impracticable the ordinary usages of international trade would amount to special circumstances in the trade; and if the non‑user of his mark by a particular trader was in fact due to the effect upon his business of those conditions then he would in my view be within the protection of sub‑section (3)."

"The case was put by Somervell LJ in the course of the argument of the imposition of prohibitive tariffs practically effective to keep out of England altogether machines manufactured abroad.  It is clear that such a tariff would strike hardest at those manufacturers who had no means of manufacturing in England and would (as it would be intended to do) immensely benefit English manufacturers; and whether or not the words 'the trade' be given their widest significance, the effect of such a tariff would in my judgement amount to 'special circumstances in the trade'."

The point thus made by Lord Evershed was carried by Kitto J in Carl Zeiss Pty Ltd's Appn (1969) 122 CLR 1 at p.6 where he said:

"A point made in the applicant's submission on this question was based upon section 23(4), which provides that if a failure to use a trade mark is shown to have been due to special circumstances in the trade an applicant is not entitled to rely on the failure for the purposes of section 23(1)(b). From this, it was said, the intention appears that a failure due to special circumstances not in the trade as a whole but relating only to the individual registered proprietor shall not be relied upon as a ground, even a discretionary ground, for the refusal of an application for removal under section 23(1)(b). I am unable to agree. The operation of sub‑section (4) is to create an absolute bar to an application and this is quite consistent with the co‑existence of a discretion in the court to refuse the application where the special circumstances are more particular than the absolute bar requires."

The combined effect of these judgements is, firstly, that no circumstance will be excluded from the protection of s23(4) by reason of its being a circumstance that affects the registered proprietor of the trade mark alone, as distinct from the trade as a whole and, secondly, that a circumstance may be regarded as a "special circumstance" within the meaning of the section if it arises as "the result of working of external forces as distinct from the voluntary acts of the individual trader". Implicit in that statement of Lord Evershed and in the examples given by him of what might be regarded as a "special circumstance", such as the destruction of a factory by fire or act of war, or the imposition of a prohibitive tariff, is the notion that the victim of the circumstance must, of course be in no way to blame for its predicament. It must be such a circumstance as, by normal commercial standards, would be completely beyond the ability of any trader to foresee or control as distinct from one which might, for example, arise from the making of a bad or unfortunate commercial judgement.

In the present case, Promenade itself closed down the park at Milson's Point and ceased using the mark in conjunction with the entertainment services which it had previously offered there. From that point on, the catalogue of events, which I have previously outlined and which prevented the mark's use at that site, occurred at and about the park. Some of these circumstances were indeed "external" and out of Promenade's control, but some were, in my opinion, caused by the action of that company itself. Mr Allsop made the point that use on another park was possible but, in a practical sense, it was very difficult. However, I cannot agree that, sometime during the period that the park was closed, the mark could not have been utilised somewhere in New South Wales for the services for which it was registered. There would not appear to have been any impediment to the mark's use elsewhere, perhaps on a temporary basis, during the period of negotiations with the Government, while time was spent on litigation, or when the discovery of asbestos at the site set off the warning bells about a long term disruption of the use of Milson's Point as a fun park. The comparative haste with which a licensing agreement was arranged for the mark's use at Magic Kingdom has convinced me that such an action should have been possible sometime during the closure at the Luna Park site. I therefore find that the non-use of the mark was not caused, at least entirely, by "special circumstances' and that, accordingly, Promenade's defence under s.23(4) must fail.

Discretion of the Registrar

In cases such as I have to decide in the present instance, it is the public interest which is the main determinant for the exercise of the Registrar's discretion to remove or retain a trade mark on the Register. On one hand, Promenade has alleged shabby behaviour by the NSW Government, the parent of the Trust, together with "special circumstances", as the reasons for its non-use of the mark. However, I feel that one of the authors for that situation was Promenade itself in voluntarily closing the park and failing to use the mark elsewhere in New South Wales, and any steps which it took to remedy the situation were ineffective or too late in terms of the s.23 period. Meanwhile, the Trust has argued that any intention by Promenade to use the mark is not relevant if the services covered by the registration cannot be offered and that the public interest would be best served by removing the mark because of its later use at Magic Kingdom despite claims that it will again be used at the Milson's Point site. This raises issues of the potential deception or confusion of the public as to the ownership of the mark, especially as it has been shown in photographs and other material which were annexed to second Baffsky declaration comprising Promenade's evidence in answer, that the mark is not now being used in the form it was registered. I think that the latter argument is the more relevant in safeguarding the public interest and I am of the opinion that it would be best served by removal of the mark from the Register.

Conclusion

Promenade has not, to my satisfaction, discharged its onus of showing why the mark should not be removed on the grounds of non-use during the period in question.  In this regard, I am mindful of the comments of Kitto J in the Carl Zeiss case, supra, where he said, "The Stiftung's omission to use the mark for the statutory period entitles the applicant to have the mark removed from the Register unless sufficient reason appears for leaving it there".  In my opinion, Promenade has not shown me such "sufficient reason" why I should exercise my discretion to retain the mark in the present instance.

Accordingly, subject to any appeal from this decision, I direct that the registration be removed for all the services for which it is registered.  Having been successful in its application, the Trust is entitled to its costs and I so award them.

Ian Forno
Hearing Officer

30 December 1993