Malleys Ltd v Whirlpool Aust Pty Ltd
[1984] FCA 132
•09 MAY 1984
Re: MALLEYS LIMITED
And: WHIRLPOOL AUSTRALIA PTY. LIMITED; ROBYN JULIE SUTHERLAND; AUSTRALIAN
TELECOMMUNICATIONS COMMISSION
No. G. 127 of 1984
(1984) ATPR para 40-455
Trade Practices
2 IPR 441
COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Lockhart J.
CATCHWORDS
Trade practices - consumer protection - motion for interlocutory injunctions - advertising and telephone entries using inter alia the name "Whirlpool" - whether misleading and deceptive conduct - whether public would believe that there was a connection between applicant or its "Whirlpool" products and respondent or that respondent was affiliated with applicant.
Trade Practices Act; s. 52, para. 53(c), (d), s. 74.
HEARING
SYDNEY
#DATE 9:5:1984
ORDER
The first and second respondents by themselves, their servants or agents be restrained from using in trade or commerce the combination of the word "Whirlpool" and the logo appearing above that word in the form in which the word and logo appear in annexure "A" to this Order or any other combination of such word and logo or any similar logo or any part of any such logo or any combination of the letter "W" and such logo or any similar logo or any part of any such logo or any document or thing on which appears any combination of the word "Whirlpool" or the letter "W" and any such logo or any part of any such logo.
The first and second respondents by themselves, their servants or agents be restrained from publishing or causing or allowing to be published in the 1984 edition or any future edition of the Sydney White Pages telephone directory, the Sydney Yellow Pages telephone directory, the Sydney Pink Pages telephone directory, the Canterbury and Bankstown Districts Community Phone Book or any similar directory or publication the words:
(i) "Whirlpool Appliance Service";
(ii) "Whirlpool Australia Pty. Limited"'
(iii) "Whirlpool Australia Pty. Limited, refrigerator and washing machine sales and service";
(iv) "Whirlpool Engineering";
(v) "Whirlpool Washing Machines";
(vi) "Whirlpool Refrigerators";
(vii) "Whirlpool Products";
(viii) "Whirlpool Product Repairs";
(ix) "Malleys Whirlpool";
or any similar combination of such words or any part of such words by way of identification of any business except as may be submitted for publication by the applicant.
The first and second respondents by themselves, their servants or agents be restrained from publishing any advertisement or document in or substantially in the form of annexures "A" and "B" to this Order or containing the word or words in substantially the form of those set out in paragraphs 2(i) - 2(ix) of this Order.
The first and second respondents by themselves, their servants or agents be restrained from representing, in connection with the manufacture, sale, servicing, repairing and supply of refrigerators, washing machines and all other white goods of the type now or at any time manufactured by the applicant or by the Whirlpool Corporation under the name "Whirlpool" or "Malleys Whirlpool" or in connection with the sale of any parts for such white goods or in connection with the provision of any services in relation to such white goods that the goods or services which they supply or provide have the sponsorship or approval of the applicant or of the Whirlpool Corporation or that the respondents or either of them have the sponsorship or approval of or are affiliated with the applicant or with the Whirlpool Corporation.
The first and second respondents by themselves, their servants or agents be restrained from using the words "Whirlpool" and "Malleys Whirlpool" by way of identification of or as the name or part of the name of any business conducted in connection with the manufacture, sale, servicing, repairing and supply of refrigerators and washing machines and all other white goods of the type now or at any time manufactured by the applicant or by the Whirlpool Corporation under the name "Whirlpool" or in connection with the sale of any parts for such white goods or in connection with the provision of any services in relation to such white goods.
The third respondent, by itself, its servants or agents, until further order be restrained from publishing or causing or allowing to be published in the 1984 edition of the Sydney White Pages telephone directory, the Sydney Yellow Pages telephone directory, the Canterbury and Bankstown Districts Community Phone Book or any similar directory or publication the words:
(i) "Whirlpool Appliance Service";
(ii) "Whirlpool Australia Pty. Limited"'
(iii) "Whirlpool Australia Pty. Limited, refrigerator and washing machine sales and service";
(iv) "Whirlpool Engineering";
(v) "Whirlpool Washing Machines";
(vi) "Whirlpool Refrigerators";
(vii) "Whirlpool Products";
(viii) "Whirlpool Product Repairs";
(ix) "Malleys Whirlpool";
or any similar combination of such words or any part of such words submitted for publication by or on behalf of the first or second respondents.
The first, second and third respondents and each of them forthwith do all such acts and execute all such documents as may be necessary or desirable to be done or executed in order to withdraw and prevent from publication in the 1984 edition of the Sydney White Pages telephone directory the words:
(i) "Whirlpool Appliance Service";
(ii) "Whirlpool Australia Pty. Limited, refrigerator and washing machine sales and service";
or any words substantially identical with or deceptively similar to those words or any of them.
The first and second respondents and each of them, within eight (8) weeks from the date of this Order, do all such things and execute all such documents as may be necessary or desirable to be done or executed in order to procure the first respondent to change its name from "Whirlpool Australia Pty. Limited" to some other name not incorporating the word "Whirlpool" or any word substantially identical with or deceptively similar to that word and to have the said change of name registered in the Register of Companies kept and maintained by the Corporate Affairs Commission of New South Wales and the Australian Capital Territory.
The first and second respondents and each of them, within fourteen (14) days from the date of this Order, do all such things and execute all such documents as shall be necessary to be done or executed in order to cease to carry on business under and to remove from the Register of Business Names kept and maintained by the Corporate Affairs Commission of New South Wales and the Australian Capital Territory where such names are registered the following names as business names:
(i) "Whirlpool Appliance Service";
(ii) "Whirlpool Engineering";
(iii) "Whirlpool Washing Machines";
(iv) "Whirlpool Refrigerators";
(v) "Whirlpool Products";
(vi) "Whirlpool Product Repairs"
(vii) "Malleys Whirlpool".
The first and second respondents pay the costs of the applicant of these proceedings.
JUDGE1
Malleys Limited, the applicant, claims that Whirlpool Australia Pty. Limited, the first respondent, is falsely representing that it is affiliated or connected with Whirlpool Corporation of Michigan, United States of America or the applicant, the previous Australian manufacturer of Whirlpool branded products under licence from Whirlpool Corporation. This conduct is said to be misleading and deceptive and therefore in contravention of s. 52, paras. 53(c) and (d) and s. 74 of the Trade Practices Act 1974. This is a motion for interlocutory injunctions to restrain that conduct.
Whirlpool products, including Whirlpool washing machines, clothes dryers, refrigerators and freezers were manufactured in Australia by the applicant from 1954 to about December 1981. The applicant continued to sell Whirlpool products until about June 1982. Although no Whirlpool products were sold by the applicant thereafter, Whirlpool refrigerators and chest freezers carried a five year warranty from the applicant; other Whirlpool goods carried a 12 months warranty. There are therefore Whirlpool refrigerators and freezers still under warranty from the applicant and still in use.
Simpson Limited owns about 98 per cent of the issued shares in the capital of the applicant. Simpson Limited owns all the issued shares in the capital of Simpson Appliance Service Limited. The applicant and Simpson Appliance Service Limited service Whirlpool, Malleys and Simpson products in Australia. They still receive requests for service of Whirlpool products previously manufactured by the applicant some of which are still under warranty. As part of its continuing service obligations to customers who purchased Whirlpool products the applicant manufactures or causes to be manufactured spare parts suitable for Whirlpool products. Nobody else in Australia is licensed by the Whirlpool Corporation to manufacture spare parts for Whirlpool appliances.
The applicant is bound under an agreement signed with Whirlpool Corporation on 2 January 1979 to continue servicing Whirlpool products sold by it before June 1982 whilst they remain under warranty. For at least the past three years an entry has been inserted by the applicant in the Sydney White Pages telephone directory as follows:
"Whirlpool (Malleys Limited), 60 Marigold Street, Revesby
Service calls only ... 772 0133;
Spare Parts Orders & Enquiries ... 774 4044
Administration Spare Parts & Service 772 0111."
In April this year the third respondent, Australian Telecommunications Commission, ("Telecom"), told the applicant that it could not insert this telephone entry in the 1984 Sydney White Pages because the first respondent had complained to Telecom about the use by anyone of the word "Whirlpool" without the written permission of the first respondent. The letter of complaint was signed by Ronald George Markey, the managing director of the first respondent, and was in these terms, omitting formal parts:
"We request that you inform Simpson Limited that as they have no further rights to the name Whirlpool they cease to use the name Whirlpool in any White or Yellow Page entries. Under no circumstances is anyone to use this name without the written permission of Whirlpool Australia Pty. Limited."
The first respondent seeks to have entries in the 1984 Sydney White Pages as follows:
"Whirlpool Appliance Service, Domestic Home Products
Service, 405 Forest Rd,
Penshurst ... 570 5700;"
"Whirlpool Australia Pty. Limited, Refrigerator and Washing Machine Sales and Service, 405 Forest Rd,
Penshurst ... 570 5700."
The first respondent seeks to have other entries inserted in telephone directories of various kinds which would include the words "Whirlpool Engineering", "Whirlpool Washing Machines", "Whirlpool Refrigerators", "Whirlpool Productions", "Whirlpool Product Repairs", "Malleys Whirlpool", although counsel for the respondents informed the court this morning that the last phrase "Malleys Whirlpool" is not one that the first respondent would seek to continue to have inserted in telephone directories or indeed use in any other way. The closing date for entries in the Sydney White Pages has passed, but the third respondent is in fact able to insert or delete entries relating to the parties to these proceedings provided they are received before the end of this week.
The first respondent was incorporated in New South Wales on 7 April 1981 as a shelf company under the name Frostell Pty. Limited. It changed its name to Whirlpool Australia Pty. Limited on 9 January 1984 when it was taken over by the second respondent and Mr. Markey. The second respondent and Mr. Markey are the shareholders and directors of the first respondent. The first respondent is also registered in the Australian Capital Territory as a foreign company.
The first respondent carries on the business of repairing and servicing washing machines, refrigerators and freezers including the Whirlpool brand of products. Prior to 9 January this year the same business was carried on under a business name "Appliance Service Centre" of which the second respondent was the registered proprietor. The second respondent and Mr. Markey carried on business under that business name in partnership for about 12 months before 9 January 1984. Prior to that time the second respondent and Mr. Markey's father carried on business in partnership together for about three years, the business being essentially the same as presently carried on by the first respondent. Mr. Markey was an employee of that business and his father had been engaged in the same general type of business since about 1963.
The first respondent acquired the business name "Whirlpool Appliance Service" from the second respondent on 12 January 1984. That business name is registered in New South Wales and the Australian Capital Territory. The first respondent carries on its business from leased premises at 405 Forest Road, Penshurst. Since the change of name of the first respondent to Whirlpool Australia Pty. Limited, it has advertised its activities in the following ways:
1) in the St. George Sutherland Shire Leader, a local weekly newspaper circulating in the St. George and Sutherland Shires. The advertisement appears there weekly and in the following form:
"Whirlpool Appliance Service 570 8927 Genuine Expert Service of all Whirlpool Washing Machines, At Whirlpool We Care."
2) in the St. George and Sutherland Shire Leader one advertisement appeared on 25 January 1984 in a form which has since been discontinued following the receipt of legal advice.
3) in the 1984 telephone book Yellow Pages for the areas of St. George, Canterbury-Bankstown and Eastern Suburbs. The advertisement has also been lodged for the Burwood-Ashfield area community telephone book but it has not yet been published. The text of the advertisement is:
"Whirlpool Australia Pty. Limited Washing Machines Sales and Service 570 5700, Genuine Expert Service of all Models, At Whirlpool We Care, 405 Forest Road, Penshurst."
The first respondent's efforts to secure listing in the Sydney White Pages is not confined to the above entries. It has also sought to have the following entries inserted "Kelvaire Services", "Domestic Refrigerator Service", "Leonard Domestic Appliances, Refrigerator and Washing Machine Service", "Malleys Whirlpool Refrigerator and Washing Machine Service", "Phillips Repairs, Refrigerator and Washing Machine Service", "Simpson Fluid Drive Repairs, Washing Machine Service", to be accompanied in each case with the address and telephone number "405 Forest Road, Penshurst, 570 5711". The first respondent has no connection with the applicant or Simpson Limited or Simpson Appliance Service Pty. Limited nor does it have any connection, so far as the evidence goes, with manufacturers of Kelvinator, Leonard or Phillips products.
The applicant claims that the first respondent's advertisement in newspapers and the Sydney telephone directories are misleading and deceptive because they would lead the public to think that the first respondent is affiliated or connected with the Whirlpool Corporation of the United States of America or the applicant or Simpson Limited or Simpson Appliance Service Pty. Limited. The first respondent asserted that all it is doing is to advertise that it services and repairs Whirlpool refrigertors, freezers and washing machines; and it denies that the advertisements or entries represent that it is affiliated or connected with the Whirlpool Corporation, the applicant, Simpson Limited or Simpson Appliance Services Limited.
The Court is not, of course, finally determining the issues in the case at this stage. The present inquiry is to determine whether there is a serious question to be tried and where the balance of convenience lies. In my opinion it is plain that there is a serious question to be tried, or, to express the test another way, that the applicant has established a prima facie case in the sense contemplated in Beecham Group Limited v. Bristoll Laboratories Pty. Limited (1968) 118 CLR 618.
The first respondent is entitled to represent that it does service and repair Whirlpool appliances, but it cannot represent, either expressly or impliedly, that it is authorised to carry on its business by Whirlpool Corporation, the applicant, Simpson Limited or Simpson Appliance and Service Limited or that it is affiliated or connected with any of them. A strong case has been made out in my view by the applicant that this is precisely what the first respondent is doing. The advertisement in the St. George and Sutherland Shire Leader, conveys a plain impression that the "Whirlpool Appliance Service 570 8927" is connected or affiliated with the manufacturer of Whirlpool appliances or authorized by it to carry on its business of servicing Whirlpool appliances. The words "At Whirlpool We Care" are in my view sufficient in themselves to convey this impression; and when coupled with the words "Whirlpool Appliance Service" the impression is very strong indeed. The advertisement for the first respondent's services in the community telephone book Yellow Pages for the St. George, Canterbury-Bankstown and Eastern Suburbs districts also conveys a plain impression to my mind that the first respondent is connected or affiliated with the manufacturer of Whirlpool appliances or authorized by it to carry out its sales and service business. Again the words "At Whirlpool We Care" appear, together with the name of the first respondent. Use by the first respondent of its corporate name in advertising its business plainly conveys the impression that it is affiliated or connected with the people who manufacture or who previously manufactured Whirlpool appliances in Australia or that it has their or its authority to repair, service and sell Whirlpool products. The proposed entries in the Sydney White Pages for 1984 convey a similar impression. The proposed artwork for advertisements in the 1985 Sydney Yellow Pages Telephone Directory suffers in my view from the same vice notwithstanding the disclaimer appearing in small print, "No Connection with Simpson Limited or the Whirlpool Corporation USA". The very emphasis given in the proposed telephone entries and artwork to the name "Whirlpool Australia Pty. Limited" or simply "Whirlpool Aust" will lead the public to think that the first respondent is affiliated or connected with the manufacturer or manufacturers of Whirlpool appliances or associated or connected or affiliated with them or acting under their authority in the course of its business.
Some members of the public may connect the name of the first respondent with the applicant or with Simpson Limited or with Simpson Appliance Service Limited or perhaps with Whirlpool Corporation of the United States of America; others may not connect the first respondent with a particular corporation at all, but would assume that Whirlpool Australia Pty. Limited is an offshoot or branch or subsidiary or otherwise connected with the manufacturer of Whirlpool appliances without knowing the names of any of the corporations concerned.
The relevant members of the public are not only those who own refrigerators and freezers the subject of the subsisting warranties, but persons who own Whirlpool appliances generally. After all, there are doubtless many Whirlpool appliances still in use in homes, shops and other places throughout Australia and outside the warranty period. A natural thing for the owner of a Whirlpool appliance who requires service to do would be to look up the Sydney White Pages telephone directory under "W" and, on seeing the proposed entry of the first respondent, would assume that the first respondent was the official Whirlpool servicing or repair representative for the manufacturer of Whirlpool appliances.
I said earlier that I had not formed any final views on the issues in the case, nor have I, but it is obvious that some cases at the interlocutory stage are either strong or weak. This case is in the former category.
As to the balance of convenience, there is evidence from Mr. Markey that should the first respondent not be permitted to advertise under its corporate name and not be permitted to insert entries under its name in the Sydney Yellow and White Pages telephone directories, its present source of custom would cease. He also gave evidence in his affidavit that the first respondent has incurred not insubstantial expenditure in setting up its business under its present name and that he anticipates a considerable increase of business in consequence of the appearance of the proposed entry in the Sydney White Pages 1984 telephone directory. He gave evidence that certain extra staff who have been employed may have to be dismissed if this extra business does not eventuate.
Mr. Markey was cross-examined and, in the result, did not leave me with any impression that any real prejudice would be sustained by the first respondent if injunctive relief were granted. The first respondent only commenced to carry on business in January this year. The applicant and Simpson Service and Appliance Limited have carried on the business of servicing and repairing Whirlpool products for about 30 years. Also, the applicant is the former Australian manufacturer of Whirlpool appliances.
The public interest is also of critical importance and I do not think that the activities of the respondent should be allowed to continue pending the final hearing. Appropriate interlocutory injunctions should therefore be granted against the first respondent. They should also be granted against the second respondent as a person knowingly concerned in the alleged contraventions.
The third respondent, Telecom, has been represented by its solicitor, who has been present throughout the proceedings. Telecom has, in effect, adopted the approach of a submitting respondent and it does not oppose the making of order number 6 in the further amended application which was handed to the court this morning, which I now give leave to be filed in court.
I shall stand the matter down until this afternoon so that counsel may bring in short minutes of order to give effect to my reasons for judgment.
At 4.15 p.m. that afternoon (9 May 1984) counsel and solicitors forthe parties informed the Court that orders should now be made by consent finally disposing of the proceeding and not merely on an interlocutory basis.
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