Pit Stop Foodstore Pty Ltd v Lee Lou Pty Ltd
[2004] QSC 2
•16 January 2004
SUPREME COURT OF QUEENSLAND
CITATION:
Pit Stop Foodstore Pty Ltd & Ors v Lee Lou Pty Ltd & Anor [2004] QSC 002
PARTIES:
PIT STOP FOODSTORE PTY LTD ACN 075 612 654
(first plaintiff/respondent)
E & M ROMANIN
(second plaintiffs/respondents)
v
LEE LOU PTY LTD ACN 069 694 588
(first defendant/applicant)
FERNBRIDGE PTY LTD ACN 010 963 854
(second defendant)FILE NO:
SC No. 10332 of 2002
DIVISION:
Trial Division
PROCEEDING:
Application
DELIVERED ON:
16 January 2004
DELIVERED AT:
Brisbane
HEARING DATE:
9 October 2003
JUDGE:
Mullins J
ORDER:
1. Paragraph 4(b) of the reply be struck out.
2. The following words of paragraph 6 of the reply be struck out:
‘and further or alternatively, on the ground that the registration of the first defendant’s trade mark was for an intended use different from the specified use’.
3. The following words of paragraph 7 of the reply be struck out:
‘is a wider use than that alleged therein’.
4. The following words of the particulars of paragraph 7 of the reply filed on 12 June 2003 be struck out:
‘and not for services in class 36 in respect of which the first defendant’s trademark was registered’.
5. The following words of paragraph 8 of the reply be struck out:
‘and further or alternatively, has been used for a purpose which was not intended at the time of registration and further or alternatively, causes confusion with the first plaintiff and second plaintiffs registered trade marks’.
CATCHWORDS:
PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PRACTICE UNDER RULES OF COURT – PLEADING – GENERALLY – where plaintiffs owners of registered trade marks – where plaintiffs alleged infringement by defendant of registered trade marks – where defendants brought application to have certain paragraphs of plaintiffs’ reply struck out under r 171 UCPR – whether specified parts of the pleading have a tendency to prejudice or delay the fair trial of the proceeding
PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PRACTICE UNDER RULES OF COURT – PLEADING – PARTICULARS – where particulars given in respect of part of reply – whether allegation in particulars relevant to defence – whether appropriate to strike out part of particulars
Trade Marks Act 1995 (Cth)
Trade Marks Regulations 1995 (Cth)
UCPR r 171COUNSEL:
T Matthews for the plaintiffs/respondents
D M Logan for the first defendant/applicantSOLICITORS:
Carter Lester for the plaintiffs/respondents
Steindls for the first defendant/applicant
MULLINS J: By application filed on 19 September 2003 the first defendant seeks an order that paragraphs 4(b), 6, 7 and 8 of the plaintiffs’ reply be struck out pursuant to r 171(a), (b) and/or (e) of the UCPR or, alternatively, that the plaintiffs file and serve an amended reply and/or further and better particulars of the reply.
Background
It is common ground that since 16 March 1999 the first plaintiff has been and remains registered owner of Australian registered trade mark numbers 788259, 788260, 788261 and 788262 and that since 16 March 1999 the second plaintiff has been and remains the registered owner of Australian registered trade mark number 788257. Each of these registered trade marks consists of specific words together with the device consisting of crossed chequered flags. The words for trade mark 788259 are ‘Pit Stop Convenience Store’ and that trade mark is registered in respect of services in class 35 of the Trade Marks Regulations 1995 (‘the Regulations’) under the Trade Marks Act 1995 (Cth) (‘the Act’) in respect of retailing of newsagency items including newspapers, magazines, cards, stationery, lottery products and tobacco products; retailing grocery items including fruit and vegetables; photocopying and fax services. Trade mark 788260 which incorporates the words ‘Pit Stop Food Store’ is also registered in respect of the same services in class 35 as trade mark 788259. Trade mark 788261 incorporates the words
‘Pit Stop Supermarket’ and is also registered in respect of the same services as trade mark 788259 in class 35. Trade mark 788262 incorporates the words
‘Pit Stop Super Store’ and is also registered in respect of the same services in class 35 as trade mark 788259.
The second plaintiff’s trade mark incorporates the words ‘Pit Stop Bottle Shop’ and is registered in respect of the goods specified in class 33 of the Regulations of alcoholic beverages.
The first defendant is the registered proprietor of the fee simple of the land situated at 406 Nerang Southport Road, Ashmore described as Lot 195 on Survey Plan 100487. There is a building constructed on that land which is described by the first defendant as commercial premises and by the plaintiffs as a convenience centre to which the description of ‘Ashmore Pitstop’ is applied. The first defendant leases various parts of this building to various lessees. One of the lessees was the second defendant which the first defendant admits carried on business at the premises until 31 October 2002. It is alleged by the plaintiffs that the business carried on by the second defendant was a retail outlet for alcoholic beverages called ‘Pit Stop Bottle Shop’.
The first plaintiff claims against the first defendant for an injunction to restrain the first defendant from infringing registered trade mark numbers 788259 to 788262, damages for infringement of those registered trade marks or, alternatively, an account of profits, interest, further or other relief as may be just and costs. The second plaintiff’s claim against the first defendant and/or the second defendant is for an injunction to restrain the first defendant and/or the second defendant from infringing registered trade mark number 788257, damages for infringement of that trade mark or, alternatively, an account of profits.
It is also common ground that the first defendant is the registered owner of Australian registered trade mark number 868582 consisting of the mark ‘PITSTOP’ and registered for services in class 36 described as real estate affairs; provision of premises for commerce; real estate appraisal and evaluation; rent collection; real estate agencies; real estate management; provision of real estate information; capital investments.
The defences of the first defendant can be summarised as:
(a)Any use by the first defendant of the words ‘Ashmore Pitstop’ in relation to its commercial premises has been in the exercise of the first defendant’s rights by virtue of the registration of the first defendant’s trade mark, relying on ss 122(1)(e) and 23 of the Act (paras 6 and 7 of the defence);
(b)The first defendant has used the business name ‘Ashmore Pitstop’ solely to identify commercial premises that it uses for the purpose of leasing to other businesses in return for rental payments and it is therefore not being used in relation to goods or services in respect of which the plaintiffs’ trade marks are registered, services of the same description as the registered goods or services or goods or services closely related to the registered goods or services within ss 120(1) and (2) of the Act (para 8 of the defence);
(c)The name ‘Ashmore Pitstop’ has only one word namely ‘Pitstop’ in common with the plaintiffs’ trade marks, is distinguished from the plaintiffs’ trade marks by the use of the word ‘Ashmore’ and is not substantially identical with or deceptively similar to any of the plaintiffs’ trade marks within s 120 of the Act (para 9 of the defence).
Whereas the defence alleged in paras 6 and 7 of the defence is based on the registration of the first defendant’s trade mark, the respective defences in paras 8 and 9 of the defence do not rely on the registration of the first defendant’s trade mark.
Para 4(b) Reply
Para 4(b) of the reply is responsive to para 4 of the defence of the first defendant. The allegation is made in para 4 of the defence that the first defendant’s trade mark is valid and subsisting. The plaintiffs’ response in para 4(b) of the reply is that they do not admit that the first defendant’s trade mark was and is valid ‘on the ground that the first plaintiff and the second plaintiffs, despite reasonable inquiries made to date, cannot until after disclosure and/or interrogatories in the proceeding, know whether the registration of the first defendant’s trade mark is liable to be set aside on grounds arising under s 59 and/or s 88 of the Trade MarksAct 1995’.
The first defendant by its solicitors’ letter dated 27 March 2003 requested that the plaintiffs either withdraw the allegation in para 4(b) of the reply or properly plead any claim for cancellation for the first defendant’s trade mark or rectification of the register. The plaintiffs declined to do so.
The concern of the first defendant is that the plaintiffs by para 4(b) of the reply are raising the possibility that they may challenge the validity of the first defendant’s registered trade mark, without particularising the basis on which the plaintiffs will do so, so that the first defendant will be embarrassed in preparing for trial. The first defendant also contends that the allegation serves to confuse and complicate the proceeding, including the ambit of the first defendant’s disclosure obligations. It is submitted that the plaintiffs are not entitled to use disclosure and interrogation to fish out a case for cancellation.
Mr Matthews of counsel on behalf of the plaintiffs submitted that para 4(b) of the reply had the effect of flagging the plaintiffs’ challenge to the validity of the first defendant’s trade mark, so that the first defendant would not be taken by surprise if the plaintiffs ultimately elected in the proceeding to seek cancellation of the registration of the first defendant’s trade mark. If it were considered necessary to do so, Mr Matthews foreshadowed the plaintiffs’ intention to amend the claim to seek an order that the register be rectified by cancelling the registration of the first defendant’s trade mark.
The challenge to the validity of the first defendant’s trade mark which presently exists in para 4(b) of the reply is equivocal and means that the first defendant does not know with certainty whether the validity of its trade mark is in issue and, if so, on what basis. Para 4(b) of the reply should be struck out pursuant to r 171(1)(b) of the UCPR.
While the first defendant’s trade mark remains registered, the first defendant is entitled to rely on the rights given to it under the Act by the registration of that trade mark. If the plaintiffs wish to attack the validity of the registration of the first defendant’s trade mark, they will need to have the registration of that trade mark cancelled or removed from the register. Mr Matthews conceded that any such relief would need to be sought by the amendment of the plaintiffs’ claim. Leave is required to amend the claim. Whether that leave should be given should be considered in the context of a properly particularised pleading in support of the claim for cancellation of the registration of the first defendant’s trade mark.
Para 6 Reply
Para 6 of the reply is responsive to paras 6 and 7 of the defence of the first defendant which raises the defence based on the registration of the first defendant’s trade mark in reliance on ss 23 and 122(1)(e) of the Act. Para 6 of the reply states:
‘The first plaintiff and the second plaintiffs deny the allegations of fact contained in paragraphs 6 and 7 of the defence of the first defendant on ground that the first defendant’s rights by virtue of the alleged valid registration of the first defendant’s trade mark do not extend to the present use of the first defendant’s trade mark, and such use is not in respect of class 36 goods and services as defined in the Act, and further or alternatively, on the ground that the registration of the first defendant’s trade mark was for an intended use different from the specified use.’
Particulars were requested by the first defendant of the allegations made in para 6 of the reply. The response of the plaintiffs was in the following terms:
‘As to paragraph 6 of the reply and in relation to the allegations identified in paragraphs 1(a), (b) and (c) of the first defendant’s request for further and better particulars thereof, the first plaintiff and the second plaintiffs say that in relation to the first defendant’s trademark that the same is registered for services in class 36 and that the first defendant’s actual use of its mark is a use which falls within the uses specified by class 35 and, as such, is an infringing use of the plaintiffs’ said trademarks. The first plaintiff and second plaintiffs say that the first defendant’s said trademark has not been used substantially in respect of class 36 services as specified therein, but rather has been used substantially in respect of class 35 services which was not the intention at the time of its registration and was not indicated by the first defendant as being a substantial use to the Trademarks Office in the course of the first defendant’s application for registration of its said trademark. The first plaintiff and second plaintiffs will refer on the trial of this proceeding to the Eighth Edition of the Nice Classification and its list of classes with explanatory notes in respect of services in classes 35 and 36.’
The point which is taken by the first defendant is that all that is relevant is the services for which the first defendant’s trade mark is registered and not what services otherwise fall within class 36. Curiously, however, that did not stop the first defendant from requesting particulars of para 6 of the reply in respect of the allegation that the present use of the first defendant’s trade mark was not in respect of class 36 goods and services.
There are two allegations in para 6 of the reply. The first is that the services for which the first defendant’s trade mark is registered do not cover the use that the first defendant is presently making of that trade mark for which the detail is added that the use of the first defendant’s trade mark is not in respect of class 36 goods and services. Presumably this detail is intended to relate to services only, as class 36 is concerned with services rather than goods. The first defendant is technically correct when it submits that what is relevant is the services for which the first defendant’s trade mark is registered. Those services are services within class 36 and are covered by the allegation in para 6 of the reply that the present use of the first defendant’s trade mark is not in respect of class 36 services. Although the detail of this allegation could have been better expressed, the first allegation in its entirety in para 6 of the reply is sufficiently clear for the first defendant to understand the response of the plaintiffs.
The second allegation is para 6 of the reply is the alternative allegation that the registration of the first defendant’s trade mark was for an intended use different from the specified use. The point is taken by the first defendant that such allegation could be relevant only to an application for cancellation or removal of the first defendant’s trade mark. There is substance in that submission. Another difficulty with the second allegation is that the particulars provided appear to be inconsistent with what is alleged in para 6 of the reply. The particulars are to the effect that the first defendant’s trade mark has been used substantially in respect of class 35 services ‘which was not the intention at the time of its registration and was not indicated by the first defendant as being a substantial use … in the course of the first defendant’s application for registration of its said trademark’. The particulars therefore seem to be saying that the first defendant’s trade mark has been used in respect of class 35 services rather than class 36 services and that it was not the intention of the first defendant to use the trade mark in respect of class 35 services at the time it applied for registration, when the second allegation in para 6 of the reply appears to be that the first defendant always intended to use its trade mark for a use other than in respect of the services in class 36 for which the application for registration was made.
The second allegation in para 6 of the reply which is found in the words ‘and further or alternatively, on the ground that the registration of the first defendant’s trade mark was for an intended use different from the specified use’ should be struck out pursuant to r 171(1)(b) of the UCPR.
Para 7 of the Reply
Para 7 of the reply is responsive to para 8 of the defence of the first defendant. Para 8 of the defence pleads the use made by the first defendant of the business name ‘Ashmore Pitstop’ and that it is not being used in relation to goods or services in respect of which the first or second plaintiffs’ trade marks are registered. Para 7 of the reply is in the following terms:
‘The first plaintiff and the second plaintiffs deny the further and alternative allegations contained in paragraph 8 of the defence on the ground that the use of the business name “ASHMORE PITSTOP” as alleged in subparagraph (a) thereof is an infringing use of the first plaintiff’s and/or second plaintiff’s registered trademarks, and further or alternatively is not a legitimate use of the said business name, and further or alternatively is a wider use than that alleged therein, and deceptive and confusing to members of the public and is substantially identical with or deceptively similar to the use to which the first plaintiff uses its trade marks registered in class 35 of the regulations to the Act;’
The first defendant requested particulars of each of the allegations in para 7 of the reply and the following particulars were provided:
‘As to paragraph 7 of the reply, and in relation to the allegations identified in paragraphs 2(a) and (b) of the first defendant’s request for further and better particulars thereof, the first plaintiff and second plaintiffs say that in relation to the first defendant’s use of the business name “Ashmore Pit Stop” that such use is not the usual or ordinary use of a business name which is to identify the business and/or the proprietors thereof, but rather is a use by the first defendant of a business name as a trademark for services substantially in class 35, and not for services in class 36 in respect of which the first defendant’s trademark was registered and therefore such use of the business name constitutes an infringement of the plaintiffs’ registered marks in class 35.’
The gist of the defence in para 8 of the defence is that the business name ‘Ashmore Pitstop’ is not being used by the first defendant in respect of services in respect of which the plaintiffs’ trade marks are registered. This defence has nothing whatsoever to do with the registration of the first defendant’s registered trade mark.
The first part of the plaintiffs’ response in para 7 of the reply is a re-statement of the allegation of infringement in the statement of claim. Although it may ‘add nothing’, as submitted by the first defendant, it is not objectionable. The second part of the response in para 7 of the reply is to challenge the first defendant’s allegation that it is using ‘Ashmore Pitstop’ as a business name. The response that it is not a legitimate use of the business name has been adequately particularised by the plaintiffs’ further particulars.
The next allegation in para 7 of the reply found in the words ‘is a wider use than that alleged therein’ is confusing. It appears to be alleging that a wider use is made of the business name ‘Ashmore Pitstop’ by the first defendant than it alleged in para 8 of the defence. That is not a response to the defence, but is more properly characterised as part of the allegation made by the plaintiffs in the statement of claim against the first defendant. Because the wording of this part of the reply is unclear, it should be struck out under r 171(1)(b) of the UCPR.
The last part of para 7 of the reply merely recites what the plaintiffs need to prove to establish infringement under s 120(1) or (2) of the Act. Although this part of para 7 of the reply could be better expressed, in that what is relevant is the services in respect of which the first plaintiff has registered its trade marks, the pleading is sufficiently clear for the first defendant to be able to proceed to trial.
There is a difficulty with one aspect of the particulars of para 7 of the reply. As the defence to which para 7 is responsive is not based on the registration of the first defendant’s trade mark, it is irrelevant for the particulars to make the allegation that the use by the first defendant of the business name as a trade mark is not for services in class 36 in respect of which the first defendant’s trade mark was registered. Although not specifically sought by way of relief, it would be appropriate to strike out that part of the particulars of para 7 of the reply found in the words ‘and not for services in class 36 in respect of which the first defendant’s trademark was registered’.
Para 8 Reply
Para 8 of the reply is responsive to para 9 of the defence. Para 8 of the reply primarily denies the allegations in para 9 of the defence on the basis that the use by the first defendant of the name ‘Ashmore Pitstop’ utilises the major component of the first and second plaintiffs’ registered trade marks. The objection raised by the first defendant to para 8 of the reply is to the further or alternative allegations made at the end of para 8 in the following terms:
‘… and further or alternatively is substantially identical with or deceptively similar to the first plaintiff and the second plaintiffs’ registered trade marks, and further or alternatively, has been used for a purpose which was not intended at the time of registration and further or alternatively, causes confusion with the first plaintiff and the second plaintiffs’ registered trade marks.’
A request was made by the first defendant for particulars in respect of the allegation that the name ‘Ashmore Pitstop’ had been used for a purpose which was not intended at the time of registration. The plaintiffs relied on the particulars provided in respect of paras 6 and 7 of the reply.
The part of para 8 of the reply to which objection is taken contains three allegations. The first allegation that the name ‘Ashmore Pitstop’ is substantially identical with or deceptively similar to the first and second plaintiffs’ registered trade marks is again a re-statement of what the plaintiffs need to prove to establish infringement of their trade marks. It may not be necessary for the allegation to be made in the reply, but it will not impede the preparation for the trial of the proceeding.
The second allegation is in a different category. As the defence in para 9 of the defence to which the allegation is responsive is not based on the registration of the first defendant’s registered trade mark, it is not appropriate for the plaintiffs to make the allegation about the propriety of the registration of the first defendant’s trade mark. The same applies to the third allegation in this part of para 8 of the reply.
The following words in para 8 of the reply should be struck out pursuant to
r 171(1)(b) of the UCPR:
‘… and further or alternatively, has been used for a purpose which was not intended at the time of registration and further or alternatively, causes confusion with the first plaintiff and second plaintiffs’ registered trade marks.’
Orders
It follows that the orders which should be made are:
1. Paragraph 4(b) of the reply be struck out.
2.The following words of paragraph 6 of the reply be struck out:
‘and further or alternatively, on the ground that the registration of the first defendant’s trade mark was for an intended use different from the specified use’.
3.The following words of paragraph 7 of the reply be struck out:
‘is a wider use than that alleged therein’.
4.The following words of the particulars of paragraph 7 of the reply filed on 12 June 2003 be struck out:
‘and not for services in class 36 in respect of which the first defendant’s trademark was registered’.
5.The following words of paragraph 8 of the reply be struck out:
‘and further or alternatively, has been used for a purpose which was not intended at the time of registration and further or alternatively, causes confusion with the first plaintiff and second plaintiffs’ registered trade marks’.
Costs
The application sought costs on an indemnity basis, relying on r 171(2) of the UCPR.
A letter had been written by the first defendant’s solicitors dated 16 May 2003 setting out the complaints about the particulars provided by the plaintiffs in respect of the reply and complaints about the reply. A further letter written pursuant to
r 444 of the UCPR was sent by the first defendant’s solicitors to the plaintiffs’ solicitors on 3 June 2003. No explanation has been provided by the first defendant for the delay in bringing the application after sending the letter of 3 June 2003. The first defendant has been substantially successful on its application, but not entirely successful. It is also relevant that the challenges by the first defendant to the plaintiffs’ pleadings have been confined to the reply and to aspects which are better characterised as peripheral rather than fundamental to the plaintiffs’ claims.
On the hearing of the application both parties made submissions about whether or not indemnity costs should be ordered in favour of the first defendant, if the first defendant were successful. Having regard to all the circumstances in connection with the application, it is not an appropriate matter in which to order indemnity costs in favour of the first defendant.
My inclination is to order that the costs of the application filed on
19 September 2003 be the first defendant’s costs in the proceeding. Apart from the submissions on the issue of indemnity costs, the parties have not made submissions on costs. I will defer making the costs order, until after the parties have had an opportunity to make oral or written submissions in relation to costs.
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