Sacks v Permanent Trustee Australia Ltd

[1993] FCA 502

JUD(3AENT No. ........ ........ .. ........ .... soa 11?93

IN THE FEDERAL COURT OF AUSTRALIA	1
1
NEW SOUTH WALES DISTRICT REGISTRY	) No NG 2h2 of 1993 1
GENERAL DIVISION	1
1

BETWEEN:  YOUBERTYOHANA
T/A BRIDAL FACTORY

Applicant

AND. J E N V A T P T I T E D

First Respondent

BEN YOHANA

Second Respondent

JULIUS YOHANA

Third Respondent

Coram-	Davies J.
Date.	4 June 1993
Sydney
should make clear is that costs are not imposed by way of punishment, for an order as	to costs is simply an incident of the proceedings. Ordinarily, if an applicant has
successfully sought an order of the Court, then the costs of the application are paid by the respondent. Of course, if the respondent succeeds, the respondent is awarded costs taxed on a party and party basis. So the standard principle is that the successful party will, in addition to any order for an amount recovered, also recover the costs of the proceedings on a party and party basis.

2 8 l U L 1 9 9 3

FEDERAL COURT OF

AUSTRALIA PRINCIPAL

REASONS FOR JUDGMENT REGISTRY

EX TEMPORE

The outstanding issue in these proceedings is one of costs. The first point I

Whilst that is the ordinary rule, the Court retams a discretion and, in the

light of certain conduct on the part of a successful applicant, may even make an order

that the whole of the costs be paid by the successful party.

Now, in these proceedings the applicants have been trading for some time

as manufacturers and retailers of bridal wear and have done so under a number of trading names in which the words "Bridal Factory" have figured prominently. The respondents have, in the past, conducted a retail business dealing with bridal wear under the name "Edessa Bridal", with shops at Fairfield and Chatswood. In March 1993, the respondents altered the nature of their operation by setting up a business

similar to that of the applicants. The respondent's business was located at Wetherill

Park, close to the applicant's business and was set up, not under their trading name of	"Edessa Bridal", but under the name "Edessa Brldal Factory". From those premises,
the respondents manufacture and sell bridal wear to the public. So within a very short distance of each other there was established two premises of which either the trade name was Bridal Factory or a substantial part of the trade name was Bridal Factory. That each proprietor knew the other is plain, for the persons standing
behind the applicants and the respondents are all members of the one family.

Now, despite the submissions put by Mr Storie, solicitor for the respondents,

that the legal proceedings have been brought about by the applicant's failure to discuss this matter with the respondents, it seems to me that it must have been known

to the respondents that if they opened a premises close to the applicant's premises and used the applicant's name, together with the word Edessa, they would incur the wrath of the applicants.

These proceedings are the result of those actions and the parties are agreed

that injunctions relating to the use of the trade names should now issue. I make no comment on the merits of the case except to say that I have a tentative view that, had the matter proceeded, I have made an order in favour of the applicants. Particularly in the circumstance that the parties belonged to the same family, to establish a factory

close to the applicant's factory and to market bridal wear to the public under the two names "Br~dal Factory", would, I think, tend to confuse members of the public seeking premises m the suburbs of Wetherill Park and so would probably constitute

misleading and deceptive conduct.

Therefore, I approach the question of costs with not only the agreed

mlnutes of order but also wth a tentative view that the applicants would have been

successful in these particular circumstances.

Mr Storie has submitted that he and his clients were taken by surprise at the

manner in which this matter has developed and that costs could have been avoided if the matter had been the subject of round table discussion. It seems to me, however, that where one party adopts a business name that is very similar to that already adopted by another persod then it can cause no surprise that legal proceedings are instituted and that, in the ordinary course of proceedings, an interlocutory injunction will be sought.

Notice was in fact given by the applicants' solicitors at a very early stage as

to what was required of the respondents. In a letter of 31 March to Mr Ben Yohanna of the respondents, the apphcants' solicitors noted the prominently situated sign referring to the new premises as "Edessa Bridal Factory". Whilst the applicants did not object to the respondents canying on business under the name "Edessa Bridal", it was contended that the inclusion of the word "Factory" in the business sign was misleading to customers of the business in breach of s.52 of the Trade Practices Act

1974 (Cth).

The agreement now reached by the parties is that the orders should

preclude the use by the respondents of the name "Edessa Bridal Factory" without

limiting their use of the words "Edessa Bridal". That the applicants were content with	that compromise was set out m the letter of 31 March. In my opinion, the
respondents were very slow to recognise the consequences of using the business name "Edessa Bridal Factory" and their failure to agree wlthout limitation to the removal of the word "Factory" has been the sole reason for the institution and continuation of these proceedings.

I would order that the costs be paid in full by the respondents but for one

factor, for it seems to me that the words "Bridal Factory" are somewhat unsuitable for

use as a business name if unqualified by any adjective. It is difficult for the applicants to contend that they have a monopoly in the words Bridal Factory, for those words are so descriptive as to have little capacity to describe one business as against another. In my view, the applicants' choice of that name may have contributed to this litigation and, in any event, I would not wsh the applicants to think that I am of the

view that they could have a monopoly as against all other traders in the words "Bridal

Factory".

In order to recognise these special circumstances, I shall reduce the order

against the respondents by one-third and I order that the respondents pay two-thirds
of the applicants' costs of these proceedings.

I certify that this and the 4 preceding pages are a true copy of the reasons for judgment

herein of the Honourable Mr Justice Davies.
Date:	4 June 1993