Premetis v 260 Oxford Street Pty Ltd

[2005] NSWSC 904

CITATION:	Premetis v 260 Oxford Street Pty Ltd & Ors [2005] NSWSC 904
HEARING DATE(S):	22/08/05, 23/08/05, 24/08/05, 25/08/05
JUDGMENT DATE :	8 September 2005
JUDGMENT OF:	Gzell J
DECISION:	Lessor entitled to injunctive relief for breach of contract, passing off and breach of the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1987. Damages to be considered separately.

CATCHWORDS:	CONTRACTS - General Contractual Principles - Construction and Interpretation of Contracts - Agreement for sale of business and goodwill - Whether unregistered trade name excluded from contract and purchasers/lessees granted a revocable licence to use the name - Whether a collaterall agreement to that effect - Whether evidence of pre-contract negotiations on use of name admissible - Whether restriction on use of name in later lease void as an attempt to assign future property or as an assignment of goodwill in gross - On expiration of lease, lessor opens business in same premises under now registered business name - Lessees threaten to continue business under the name from premises 200 metres away - Whether passing off - Whether misleading or deceptive conduct
LEGISLATION CITED:	Trade Practices Act 1974 (Cth) Fair Trading Act 1987 Business Names Act 1962
CASES CITED:	Churton v Douglas (1859) Johns 174 (70 ER 385) Federal Commissioner of Taxation v Murry (1998) 193 CLR 605 Maas v Pepper [1905] AC 102 Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1981-1982) 149 CLR 337 De Lassalle v Guilford [1901] 2 KB 215 JH Coles Pty Ltd v Need [1934] AC 82 Kall-Kwik Priniting (UK) Ltd v Rush [1996] 23 FSR 114 Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 Palette Shoes Pty Ltd v Krohn (1937) 58 CLR 1 Geraghty v Minter (1979) 142 CLR 177 Reckitt & Colman Products Ltd v Borden Inc (1990) 17 IPR 1 Powell v Birmingham Vinegar Brewery Co Ltd (1897) 14 RPC 720
PARTIES:	Arthur Premetis - Plaintiff 260 Oxford Street Pty Ltd - 1st Defendant/Cross Claimant Bosco Vujovic - 2nd Defendant Vladimir Jujovic - 3rd Defendant Juliet Vanessa Jujovic - 4th Defendant Arthur Premetis Trading as Arthur's Pizza - 1st Cross Defendant AP Pizza (Aust) Pty Ltd - 2nd Cross Defendant
FILE NUMBER(S):	SC 2441/05
COUNSEL:	Mr B Rayment QC/ Mr D Kell - Plaintiff and 2nd Cross Defendant Mr R Webb SC/ Mr M Green - Defendants
SOLICITORS:	Tzovaras Legal Holdings Redlich

LOWER COURT JURISDICTION:

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

THURSDAY 8 SEPTEMBER 2005

2441/05 ARTHUR PREMETIS v 260 OXFORD STREET PTY LTD & ORS

JUDGMENT

1 Arthur Premetis conducted a pizzeria from his premises at 260 Oxford Street, Sydney under the name “Arthur’s Pizza”. He sold the business in 1993 to Vladimir Vujovic, the third defendant, and his wife, Juliet Vanessa Vujovic, the fourth defendant, and granted them a three year lease of the premises. In 1996, Mr Premetis granted a four year lease to 260 Oxford Street Pty Ltd, the first defendant, the equal shareholders and directors of which were Mr and Mrs Vujovic and Mr Vujovic’s brother, Bosco Vujovic, the second defendant. In 2000, Mr Premetis granted a further five year lease to the Oxford Street company without a renewal option.

2 From 1993 until the expiration of the lease in 2005, Mr and Mrs Vujovic and, subsequently, the Oxford Street company conducted a pizzeria business from 260 Oxford Street under the “Arthur’s Pizza” name. The 2000 lease contained a provision that the name belonged to Mr Premetis, it could not be removed and used in any other location than to 260 Oxford Street, and if the Oxford Street company were to operate from other premises, it would not trade under the name “Arthur’s Pizza”.

3 Upon the expiration of the 2000 lease, the Oxford Street company moved to 180 Oxford Street and set about establishing a pizzeria business at those premises under the name “Arthur’s Pizza”. Without admission, it and the Vujovics consented to an interlocutory injunction restraining them from using that name. If the injunctions are dissolved, however, they intend to operate the business under the name “Arthur’s Pizza” or “Arthur’s” or “the Arthur’s Crew”.

4 Also upon the expiration of the 2000 lease, Mr Premetis and his company, AP Pizza (Aust) Pty Ltd, the second cross-defendant, commenced to carry on a pizzeria business at 260 Oxford Street under the name “Arthur’s Pizza”.

5 The issues to be determined are whether the name “Arthur’s Pizza” passed with the goodwill to Mr and Mrs Vujovic upon the purchase of the business in 1993, whether Mr Premetis is entitled to enforce the restrictive provision in the 2000 lease, and whether Mr Premetis or, alternatively, the Oxford Street company is entitled to damages or an account of profits for passing off or damages under the Trade Practices Act 1974 (Cth) or the Fair Trading Act 1987 for misleading or deceptive conduct.

The 1993 sale of the business

6 Mr Premetis had operated a pizzeria at 260 Oxford Street under the name “Arthur’s Pizza” from 1974 to 1979. For a short period thereafter, the pizzeria was operated by a lessee under that name. But for a period of some seven years thereafter, it was operated by the lessee under the name “Mena’s Pizza” and then under the name “Jim’s Pizza” for a further five years.

7 Mr Premetis re-took possession of the premises in 1992 and re-opened the pizzeria under the name “Arthur’s Pizza”. It was in June 1993 that he sold the business to Mr and Mrs Vujovic.

8 260 Oxford Street was not the first business conducted by Mr Premetis under the name “Arthur’s Pizza”. In 1969, he purchased a property in Charing Cross and operated a pizzeria under that name for about three years. Mr Premetis sold the business and, subsequently, the real estate. He said it was agreed that the purchaser could use the name “Arthur’s Pizza” while operating a pizzeria from the premises, but the name belonged to Mr Premetis.

9 In 1984, Mr Premetis purchased premises in Maroubra from which a lessee operated an Italian restaurant under the name “Portofino” until 2002 when Mr Premetis re-took possession and opened a pizzeria under the name “Arthur’s Pizza”. In early 2003, Mr Premetis sold the business to a lessee who operated under the name “Arthur’s Pizza”. In 2005, Mr Premetis re-took possession, and at the time of trial, the premises were being renovated to be re-opened by Mr Premetis as a pizzeria under the name “Arthur’s Pizza”.

10 Mr Premetis purchased premises in Randwick in 1989 that he operated as a pizzeria under the name “Arthur’s Pizza” for some two years. He sold the business to lessees but retained rights to the name “Arthur’s Pizza” and gave permission for the name to be used at the premises. Subsequent lessees continued the operation of the premises as a pizzeria under the name “Arthur’s Pizza”.

11 In 1997, Mr Premetis purchased a property at 139 Oxford Street, Bondi Junction and opened an “Arthur’s Pizza” restaurant. He sold the business to a lessee in 1999 but re-purchased it in 2003, when he re-opened a pizzeria under the name “Arthur’s Pizza”. In 2004, he sold the business but retained the rights in the name and granted the lessees permission to use it at the premises. It was being operated as a pizzeria under the name “Arthur’s Pizza” at the time of trial.

12 Mr Premetis owns the premises from which the pizzerias are conducted. He established the name. He has now standardised signage. He trains tenants in the operations of the business. Both Mr Vujovic and his brother received such training prior to the 1993 agreement for sale of the business. Mr Premetis regularly visits the leased premises and talks to the tenants and checks cleanliness, service and quality. He provides advice and guidance as to the conduct of the businesses. From time to time he refers potential customers to a particular “Arthur’s Pizza” pizzeria. The evidence was that some customers were drawn to an “Arthur’s Pizza” pizzeria, because they had eaten the products of one of the other “Arthur’s Pizza” pizzerias. There is a similarity in the menus of the businesses and in their appearance.

13 In the 1993 agreement for sale to Mr and Mrs Vujovic, the business was described as “Arthur’s Pizza” but those words were struck out of the agreement. Mr Premetis said there was a verbal agreement between the parties that the name was not included and that was corroborated by a diary note of his solicitor, John Theodoridis when taking instructions from Mr Premetis: “The name “Arthur’s Pizza” remains with owner”.

14 It was common ground that Mr Premetis had provided vendor finance upon the sale of the business and that he required the business to be conducted under the name “Arthur’s Pizza” until the vendor finance was discharged, at which time Mr and Mrs Vujovic were entitled to operate the pizzeria under any name of their choosing.

15 Mr Theodoridis’ file note also contained: “As long as an amount is outstanding on the “vendor finance” the name of the shop cannot be changed”.

16 It was argued that the name “Arthur’s Pizza” was one of the sources of goodwill and since Mr Premetis had assigned his business including its goodwill to Mr and Mrs Vujovic, they, and subsequently, the Oxford Street company, were entitled to the continued use of the name.

17 As a general proposition, an assignment of a business and its goodwill carried on under a business name, will entitle the purchaser to restrain the continued use of the name by the vendor (Churton v Douglas (1859) Johns 174 (70 ER 385)). But that general proposition is subject to exception if the terms of the contract or the surrounding circumstances so indicate (Federal Commissioner of Taxation v Murry (1998) 193 CLR 605 at [29]).

18 It was submitted that the agreement for sale did not specify that the name “Arthur’s Pizza” did not follow the assignment of the goodwill of the business. Indeed, cl 9 provided that on completion, Mr Premetis was to sign and deliver to Mr and Mrs Vujovic all necessary forms to notify under the Business Names Act 1962 the change of ownership of any business name being used in connection with the business. Mr Premetis had not registered “Arthur’s Pizza” as a business name at that time.

19 It was submitted that the evidence of Mr Premetis as to the pre-contract discussions with Mr Vujovic relating to the name “Arthur’s Pizza” were inadmissible. In my view the evidence fell within three exceptions to the parol evidence rule. First, the evidence was admissible to show the true nature of the transaction (Maas v Pepper [1905] AC 102). Did it or did it not exclude the business name from the transfer of goodwill? Secondly, the striking out of the words “Arthur’s Pizza” from the agreement for sale was equivocal and evidence of a prior agreement of the parties that the name should be excluded from the sale was admissible (Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1981-1982) 149 CLR 337 at 352). Thirdly, Mr Premetis pleaded in the alternative that he and Mr Vujovic entered into a collateral agreement that Mr Premetis was entitled to the name, in consideration for his entering into the agreement for sale. Evidence of that oral agreement was admissible (De Lassalle v Guilford [1901] 2 KB 215).

20 Mr Vujovic denied that he had a conversation with Mr Premetis in which he asked whether they could change the name “Arthur’s Pizza” to which Mr Premetis said he responded that the name was his and if Mr Vujovic did not want to use the name, he did not have to buy the business.

21 Mr Vujovic had said in an earlier affidavit that it did not concern him that the name was crossed out of the agreement for sale because he, his wife and his brother were going to change the name in any event. They registered the name “Pepperoni Bar” on the same day as the agreement for sale was executed.

22 Furthermore, if the name “Arthur’s Pizza” had passed to Mr and Mrs Vujovic, one would have expected them to object to the continued use of the name at Charing Cross and Randwick and the use of the name at Bondi Junction and Maroubra.

23 Although his evidence was somewhat contradictory, in the end Mr Vujovic agreed that the name “Arthur’s Pizza” had been deleted from the sale agreement. When asked whether, according to him, he bought the name “Arthur’s Pizza” from Mr Premetis in 1993 he replied: “No, we didn’t”.

24 It was submitted that I should not accept the evidence of Mr Premetis on grounds of credit. I reject that submission. The admission of Mr Vujovic is consistent with the evidence given by Mr Premetis and that evidence is corroborated by diary notes of Mr Theodoridis when he took instructions to draw the agreement for sale. Where the evidence of Mr Vujovic diverges from that of Mr Premetis, I prefer that of the latter.

25 That Mr Premetis was empowered to licence the use of the name “Arthur’s Pizza” in the absence of registration under the Business Names Act 1962, is supported by JH Coles Pty Ltd v Need [1934] AC 82.

26 The appellant carried on business at shops in and near Melbourne under trade names that had become associated with its business and it had the exclusive right to use the names under the Business Names Act 1928 (Vic). It was verbally agreed with the respondent that he should, at his own expense, open a shop fitted up like the appellant’s shops and there sell goods to be bought from the appellant at a discount. The business name was painted up over the shop. Following a failure of the respondent to purchase goods from the appellant, it terminated the agreement and claimed an injunction restraining the respondent from trading under the business name.

27 The Privy Council held that the appellant was entitled to that relief. The name had not ceased to be distinctive of the appellant’s business and all the respondent had was a revocable licence to use the name.

28 Lord Wright, who delivered the judgment of their Lordships, put the case on two bases at 87. Once the revocable licence was revoked, the continuance of the user of the trade names necessarily involved a passing off by the respondent of his business as being a business for the sale of the appellant’s goods and as being a business in which the appellant had at least an interest. Secondly, his Lordship expressed the view that the prohibition contained in the Business Names Act 1928 (Vic) for the protection of the registered owner of a name, entitled the appellant to equitable relief.

29 It was submitted that the decision was distinguishable on two grounds. First, there was no sale of a business in Coles. That is a difference but one, in my view, that does not affect the underlying principle that when a revocable licence is revoked, the licensee has no right to the continued use of a trade name.

30 Secondly, it was argued that Mr Premetis did not own any other business that traded under the name “Arthur’s Pizza”. At the time the 1993 agreement was executed, Mr Premetis had sold his business at Charing Cross and at Randwick but in each case he said he retained the name but permitted the purchasers to use it while they conducted pizzerias from the premises.

31 By the time the licence was revoked at the expiration of the 2000 lease, the Bondi Junction and Maroubra premises were both the sites of pizzeria businesses operating under the name “Arthur’s Pizza” in addition to the Randwick premises under arrangements that Mr Premetis said involved his retention of the name and permission to the lessees to use it while conducting pizzerias from the premises.

32 It was argued that Mr Premetis did not exercise any control over the use of the trade name and, in consequence, it lacked identification with any business conducted by him. But the name was used by his lessees and was used by him on the occasions he re-took possession of leased premises and conducted a pizzeria himself.

33 In my view, “Arthur’s Pizza” remained distinctive of businesses in the eastern suburbs operated by lessees from Mr Premetis and the name retained value for him as distinctive of the businesses he permitted his lessees to conduct under that name.

34 In Kall-Kwik Priniting (UK) Ltd v Rush [1996] 23 FSR 114, a restrictive covenant upon the termination of a franchise agreement was held enforceable because a restriction upon competition was appropriate having regard to the re-transfer of goodwill upon termination. And it did not matter that no specific amount was allocated to goodwill because it was all part of one larger transaction. At 119 it was said:

“One way perhaps of looking at a franchise agreement is that this is a form of lease of goodwill for a term of years, with an obligation on the tenant, as it were, to retransfer the subject matter of the lease at the end of the lease in whatever state it is. So to that extent there is no obligation to transfer goodwill in a particular form which is much more akin, I think, to the goodwill cases than to the servant cases.
I do not for my part think it matters that there is no specific sum attached to the retransfer of the goodwill: see Bridge v Deakins [1984] AC 705 at 718. I think that the proper way of looking at it is that this is all part of a wider commercial deal in which profits and losses pass between both sides and so it is not really necessary to try to identify one particular piece of consideration which attaches to the transfer of the goodwill as such.”

35 The sale of a business with retention of the trade name and a licence to use it so long as a lease remains on foot, creates much the same circumstances. There is a transfer of the goodwill of the business to the lessee and the lessor gains the advantage of such goodwill as is attracted to a new business conducted from the premises under the trade name upon the expiration of the lease.

36 But that is the result of the contractual arrangements between the parties. And there is no claim to equitable relief against enforcement of those arrangements.

37 Construing the agreement for sale in light of the admissible extrinsic evidence and the surrounding circumstances known to the parties, I conclude that the name “Arthur’s Pizza” was excluded from the agreement for sale and did not follow the goodwill into the hands of Mr and Mrs Vujovic. They were, in consequence, incapable of transferring any permission to use the name to the Oxford Street company. By the agreement for sale, Mr Premetis granted to Mr and Mrs Vujovic a licence to use the name “Arthur’s Pizza” and a requirement that they use the name until the vendor finance had been discharged.

38 If I be wrong in that construction of the agreement for sale, I am of the view that the extrinsic evidence establishes a collateral agreement between Mr Premetis and Mr Vujovic that the name “Arthur’s Pizza” was excluded from the sale of the business and remained with Mr Premetis, that Mr and Mrs Vujovic were licensed to use the name and were required to use it until the vendor finance was discharged, in consideration for Mr Premetis entering into the agreement for sale of the business.

The 2000 Lease

39 In the negotiations for the 2000 lease, correspondence passed between the solicitors for the parties. The solicitors for the Oxford Street company claimed that the sale of the business to Mr and Mrs Vujovic had included the name “Arthur’s Pizza”. This was denied by Mr Premetis whose solicitors demanded, and received, an acknowledgement that the name had not been included in the sale of the business. On 19 February 2000, the solicitors for Mr Premetis wrote in these terms:

“My instructions on this issue are that the business name was never part of the sale to Mr & Mrs Vujovic in 1993. This is clearly reflected in the fact that the reference to the business name is deleted from the front page of the contract and also in fact that at the time of the settlement, no documents relating to a change of ownership of the business name were handed to the purchasers or sought by the purchasers.

I am further instructed that at the time that Mr and Mrs Vujovic purchased the business they indicated to my client that it was their intention to trade under a different name and there was never an issue about the name being included in the sale or of them acquiring any rights to it.”

These paragraphs appeared at the bottom of the first page and the top of the second page of the letter.

40 The acknowledgement was signed by Mr and Mrs Vujovic on behalf of the Oxford Street company. It was in the following terms:

“Subject to the proposed lease being duly entered into and your lawful right to use and authorise the Company to use the name ““Arthur’s Pizza”” under the Business Names Act 1962 (as amended):-
The Company hereby acknowledges the matters set out in the last paragraph on page 1 and the first paragraph on page 2 of letter dated 19th February 2000 from Theodore Sullivan & Partners, Solicitors to Dennis WA Langley, Solicitor.”

41 It was argued that Mr Premetis had no right under the Business Names Act 1962 to authorise the Oxford Street company to use the name “Arthur’s Pizza”. But on the day the acknowledgement was proffered, the name was registered to Mr Premetis under the Act. It was also argued that the document was a carefully crafted one that merely acknowledged the assertions of Mr Premetis but did not adopt the truth of them. That is an extremely narrow construction of a document meant to have commercial effect.

42 It was submitted on behalf of Mr Premetis that the acknowledgement was part of the surrounding circumstances known to the parties and the 2000 lease is to be construed in its light.

43 I reject that submission. It seems to me that the acknowledgement was part of the negotiations that merged in the terms of the 2000 lease. For that reason, it is unnecessary for me to deal with the submissions as to the proper construction of the acknowledgement.

44 Clause 20 of the 2000 lease contained the restrictions upon use of the “Arthur’s Pizza” name. It was in the following terms:

“(a) Lessee agrees that he shall conduct his business from the premises under the trading name ““Arthur’s Pizza”” and that such name shall at all times belong to the Lessor and nothing herein shall be taken to grant to the Lessee the property right to the said name.
(b) The Lessor consents to the use of the name ““Arthur’s Pizza”” by the Lessee so long as the Lessee shall continue to be a tenant of the Lessor.
(c) The Lessee acknowledges and agrees that the name ““Arthur’s Pizza”” cannot be removed and used by the Lessee in any other location from where the Lessee may operate in the future and that if the Lessee is desirous of operating from other premises, he shall not trade from such other premises under the business name ““Arthur’s Pizza””.
(d) The Lessee acknowledges that the name ““Arthur’s Pizza”” is also used by other tenants of the Lessor at other locations and the Lessee shall raise no objection or in any way claim compensation by reason of the fact that the name ““Arthur’s Pizza”” is used with the consent of the Lessor in other premises.”

45 It was submitted that cl 20 did not deal with the goodwill in the “Arthur’s Pizza” name or the proprietary rights in the name in the Oxford Street company before the lease was executed. This submission presupposed that the trade name passed to Mr and Mrs Vujovic in 1993 and passed from them to the Oxford Street company at or about the time of the second lease in 1996.

46 In light of my conclusion that the trade name did not pass with the goodwill of the business in 1993, that submission fails.

47 It was further submitted that in dealing with the use of the trade name in the future, cl 20 was an arrangement that goodwill generated by the Oxford Street company in the future through the conduct of its business would belong to Mr Premetis. It was said that this constituted an attempt to convey property, the trade name and its associated goodwill, in the future and was void for that reason and for the reason that it was an attempt to assign goodwill in gross.

48 A conveyance of future property could not be affected at common law (Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 at 24). But future property was assignable in equity for value (Palette Shoes Pty Ltd v Krohn (1937) 58 CLR 1 at 26). Because goodwill was not severable from the assets used in the conduct of a business, it could neither be held nor assigned in gross (Geraghty v Minter (1979) 142 CLR 177 at 181).

49 But, again, the submission presupposes that the trade name had followed the goodwill into the hands of Mr and Mrs Vujovic and was to be dealt with at their expense by cl 20. Not only did the trade name not pass to Mr and Mrs Vujovic, but also cl 20 was not couched in terms of a conveyance.

50 The trade name was that of Mr Premetis and cl 20(a) acknowledged that fact and that the licence by Mr Premetis for the name to be used in the business at 260 Oxford Street, granted no proprietary interest in that name to the Oxford Street company.

51 The licence granted in cl 20(b) was limited to the period in which the Oxford Street company remained a tenant of Mr Premetis in the leased premises.

52 By cl 20(c), the Oxford Street company agreed that the trade name could not be removed and used by it in any other location from where it might operate in the future, and if it did operate from other premises, it should not trade from those premises under the name “Arthur’s Pizza”.

53 In my view, cl 20 is clear in its terms. What the Oxford Street company and its directors and shareholders propose to do at 180 Oxford Street is in direct contradiction to the agreement in cl 20(c). They intend to continue the business using the name “Arthur’s Pizza”, “Arthur’s” or “the Arthur’s Crew”. They intend to promote and advertise that business by reference to those names. The new location is 200 metres from 260 Oxford Street.

54 That threatened course of conduct is in contravention of cl 20(c) and ought to be restrained by injunction. In my view, damages are an inadequate remedy.

Passing off

55 There is no doubt that when the 2000 lease expired, the Oxford Street company, and the Vujovics before it, had built up a successful business trading under the name “Arthur’s Pizza” and that the goodwill of the business belonged to the Oxford Street company. Over the years, new menus including gourmet pizzas were introduced. A distinctive ambiance was developed with music, lighting and other improvements. A home delivery service was introduced. The quality of ingredients was improved. Marketing was undertaken, including letter drops of takeaway menus on postcards. And media publicity was sought and obtained.

56 Mr and Mrs Vujovic paid off the vendor finance ahead of time. They then had the opportunity to operate their business under a different trade name, one that they could have used at 180 Oxford Street. They chose not to do so.

57 The intended use of the name “Arthur’s Pizza” and similar words by the Oxford Street company at 180 Oxford Street will inevitably constitute passing off. It will constitute a misrepresentation by which the goodwill of the business conducted by Mr Premetis and his company at 260 Oxford Street will be deflected to the use of the Oxford Street company with consequent damage to the business of Mr Premetis and his company.

58 The elements of the cause of action for passing off have been described as a classical trinity of reputation, misrepresentation, and injury or damage to goodwill (Reckitt & Colman Products Ltd v Borden Inc (1990) 17 IPR 1 at 7).

59 It is not necessary that customers should know the identity of the owner of the trade name. It is sufficient that they recognise the product by this indicium. As Lord Halsbury said in Powell v Birmingham Vinegar Brewery Co Ltd (1897) 14 RPC 720 at 729:

“It may be true that the customer does not know or care who the manufacturer is, but it is a particular manufacture that he desires. He wants “Yorkshire Relish” to which he has been accustomed, and which, it is not denied, has been made exclusively by the plaintiff for a great number of years. This thing which is put into the hands of the intended customer is not “Yorkshire Relish” in that sense. It is not the original manufacture. It is not made by the person who invented it. Under these circumstances, it is a fraud upon the person who purchases to give him the one thing in place of the other.”

60 The established businesses in the eastern suburbs operating under the name “Arthur’s Pizza”, means that there would be a grave risk of significant confusion in the market if the Oxford Street company were allowed to carry on business at 180 Oxford Street under the name “Arthur’s Pizza” or colourable imitations thereof. In my view, the elements of a passing off action have been established and Mr Premetis is entitled to injunctive relief for passing off as well.

61 The claim by the Oxford Street company in passing off fails.

Misleading and deceptive conduct

62 For similar reasons, the proposed conduct would be misleading or deceptive in terms of the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1987 and Mr Premetis is also entitled to injunctive relief under those Acts.

Damages

63 In addition to the injunctive relief to which I have referred, Mr Premetis is, in my view, entitled to damages or an account of profits for passing off and to damages under the Trade Practices Act 1974 (Cth), s 82 or the Fair Trading Act 1987, s 68 if he establishes loss or damage. Those matters are to be considered separately.

Conclusion

64 I have concluded that the name “Arthur’s Pizza” was excluded from the 1993 agreement for sale of the business and did not follow the goodwill into the hands of Mr and Mrs Vujovic. They were, in consequence, incapable of transferring any permission to use the name to the Oxford Street company. By the agreement for sale, Mr Premetis granted to Mr and Mrs Vujovic a licence to use the name “Arthur’s Pizza” and a requirement that they use the name until the vendor finance had been discharged

65 If I be wrong in that construction of the agreement for sale, I am of the view that the extrinsic evidence established a collateral agreement between Mr Premetis and Mr Vujovic that the name “Arthur’s Pizza” was excluded from the sale of the business and remained with Mr Premetis, that Mr and Mrs Vujovic were licensed to use the name and were required to use it until the vendor finance was discharged, in consideration for Mr Premetis entering into the agreement for sale of the business.

66 In my view, cl 20 of the 2000 lease is clear in its terms. What the Oxford Street company and its directors and shareholders propose to do at 180 Oxford Street is in direct contradiction of the agreement in cl 20(c) and ought to be restrained by injunction. In my view, damages are an inadequate remedy.

67 The established businesses in the eastern suburbs operating under the name “Arthur’s Pizza”, means that there would be a grave risk of significant confusion in the market if the Oxford Street company were allowed to carry on business at 180 Oxford Street under the name “Arthur’s Pizza” or colourable imitations thereof. In my view, the elements of a passing off action have been established and Mr Premetis is entitled to injunctive relief for passing off as well and the claim by the Oxford Street company in passing off fails.

68 For similar reasons, the proposed conduct would be misleading or deceptive in terms of the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1987 and Mr Premetis is also entitled to injunctive relief under those Acts.

69 Questions of damages are to be considered separately.

70 I will hear the parties on the terms of appropriate orders and I will hear the parties on costs. I direct the parties to bring in short minutes of orders reflecting these reasons.

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