Saxby Bridge Mortgages Pty Ltd v Saxby Bridge Pty Ltd

[2001] ATMO 97

TRADE MARKS ACT 1995

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

Re:Opposition by Saxby Bridge Mortgages Pty Ltd, to registration of trade mark application 777027(35)(36)(37) – SAXBY BRIDGE- filed in the name of Saxby Bridge Pty Limited.

Background

Application 777027 was filed by Saxby Bridge Pty Limited (‘the applicant’) on 29 October 1998.  The application seeks to register the trade mark ‘Saxby Bridge’ in respect of the following services in Classes 35, 36 and 37 of the International (Nice) Classification of Goods and Services.

Class: 35 

Business consulting and management and business administration

Class: 36 

Insurance; financial and investment affairs; real estate affairs

Class: 37 

Property development; building construction; installation services for information technology systems

Following examination of the application, it was accepted for registration and advertised as such in the Australian Official Journal of Trade Marks on 18 March 1999.  On 16 June 1999, within the time allowed to do so, Saxby Bridge Mortgages Pty Limited (‘the opponent’) filed Notice of Opposition (‘the Notice’) to the registration of the trade mark.  In brief, as some of the grounds in the Notice appear to be repeated, I restate the grounds in the Notice as follows:

• The applicant is not the owner of the trade mark (section 58)
• The applicant does not intend to use the trade mark (section 59)
• The trade mark is not capable of distinguishing the services of the applicant (section 41)
• The use of the trade mark would be likely to deceive or cause confusion in terms of sections 43 and 60 of the Act.
• The use of the trade mark is contrary to law (section 42)
• The registration of the trade mark is prohibited by section 44 of the Act
• In the exercise of the registrar’s discretion, registration of the trade mark should be refused

The parties have completed the service and filing of their evidence in these proceedings as provided for in the regulations.  However, neither party has requested a hearing or submitted written argument relating to the issues raised.  Section 55 of the Act provides:

55  Decision

Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

(a)to refuse to register the trade mark; or

(b)to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

having regard to the extent (if any) to which any ground on which the application was opposed has been established.

Note:For limitations see section 6.

The opposition has therefore come to me to decide on the written record as a delegate of the registrar of trade marks.

The declarations filed in these proceedings are, in tabular form:

Declarant	Known as	Date Made	Exhibits
Evidence in Support
John Brett Kingston	Kingston 1	1 September 1999	JBH-1
John Brett Kingston	Kingston 2	15 August 2000
Evidence in Answer
Jeffrey Joseph Braysich	Braysich 1	15 November 2000
Jeffrey Joseph Braysich	Braysich 2	15 November 2000	1 – 4
Jeffrey Joseph Braysich	Braysich 3	21 February 2001	1

I will note now that Braysich 2 mentions proceedings No 1618 of 1999 in the Supreme Court of New South Wales between the Parties.  In fact, proceedings between the parties appear to have been extensive and are reported at:

• Saxby Bridge Mortgages Pty Ltd v Saxby Bridge Pty :Ltd  [2001]  NSWCA 282
• Saxby Bridge Mortgages v Saxby Bridge [1999]  NSWSC 695
• Saxby Bridge Mortgages Pty Ltd v Saxby Bridge Pty Ltd [2000]  NSWSC 433
• Saxby Bridge Mortgages Pty Ltd v Saxby Bridge Pty Ltd [1999]  NSWSC 251

The above-cited cases appear to have little direct bearing on the issues before me.  However, they are useful in verifying some of the factual background of this matter. 

The declarations in evidence cover much more ground than is relevant to these proceedings and I concentrate on those parts which I consider to be pertinent.

John Kingston is Managing Director of the opponent.  In 1993, he avers, he worked for Australian Home Loans Pty Ltd (Aussie Home Loans) as an area sales manager selling mortgages.  Subsequently, he worked as an independent mortgage and finance broker for some three months before joining FAI First Mortgage Pty Limited (‘FAI’) in February 1993 as a senior consultant marketing residential mortgages and some commercial mortgages.  In 1994 he had written a large amount of business for FAI and had built up a network of contacts such as accountants, brokers, solicitors and conveyancing solicitors, mortgage insurers and wholesale ‘funders’ who referred and serviced clients seeking mortgages.

Mr Kingston states that in December 1994, he had an approach from an Associate Director of the applicant company who stated that the applicant was looking at putting together a new mortgage venture and was looking for someone to head it.  At that time, Mr Kingston was dissatisfied with his remuneration package at FAI and he entered into negotiations with the applicant company.

Mr Kingston says that negotiations took place with John Braysich who is Managing Director of the applicant.  During the course of negotiations Mr Braysich advised him that, “Mortgages at the moment are a dirty word [among companies in the Saxby Bridge group].  All of the top guys have lost good clients with the slip ups through the mortgage part of the existing company.”  [Parenthetical material added].

The negotiations culminated in Mr Kingston accepting an 80% shareholding in a new company called Saxby Bridge Mortgages Pty Ltd – the balance of the shares were held by the applicant.  The applicant sub-let office space to the opponent and shared in telephone rentals.  The applicant, says Mr Kingston, in Kingston 2 at paragraph 4, “consented to the opponent’s use of the trade mark SAXBY BRIDGE in relation to mortgage, home loan and financing services and in fact never used the trade mark in respect of these services”.

Mr Kingston says that, after setting up Saxby Bridge Mortgages and commencing operations on 1 March 1995, there was reluctance on the part of the applicant’s sales consultants to have anything to do with the new company because of the previous personnel in the mortgage divisions of the applicant who had lost clients because of incompetence and delays in approvals.  I understand from this that the applicant's sales consultants did not initially often refer clients to the opponent. 

However, mortgage referrals from the applicant to the opponent grew and by, I would estimate, early 1998, the business had some success.  But, Mr Kingston says that, from July 1998, the business relationship between the applicant and opponent began to deteriorate and on 24 February 1999, the opponent received a termination letter from the applicant which severed the business relationship and required the opponent to vacate its office space.  I understand that the applicant still owned 20% of the opponent's shares.

As at 15 August 2000, the opponent had continued to use the trade mark SAXBY BRIDGE in relation to its mortgage services.

Mr Kingston says that, “my company has become the owner of the trade mark SAXBY BRIDGE MORTGAGES the period from 1995 to the present in that it has been the exclusive owner of that mark in that period with respect to mortgage, home loan and financing services and that its use of the mark has been bona fide use as the company was set up to provide these services with no restrictions set out or implied.”

Mr Braysich says that he is Managing Director of the applicant company.  Relevant to these proceedings, he says, at paragraph 5 sub (ii) of Braysich 1, that during the negotiations referred to above, it was agreed the applicant would allow the opponent to use the name SAXBY BRIDGE as its corporate name.  In Braysich 2, the declarant states that the applicant was founded on 28 October 1992 to provide a full range of financial, business and property services to the public as well as commerce and industry in Australia.

The trade mark SAXBY BRIDGE was selected by the founders of the applicant because it had an appealing ring to it in relation to a provider of financial services.  There are a number of companies in the group, each of which carry the name Saxby Bridge.  These are Saxby Bridge Financial Planning Pty Ltd; Saxby Bridge Home Loans Pty Ltd; Saxby Bridge Corporate Finance Pty Ltd; Saxby Bridge Property Group Pty Ltd; Saxby Bridge Travel Pty Ltd; Saxby Bridge Property and Finance Pty Ltd.

Since 1992, the applicant, states Mr Braysich, has provided a number of services through the Saxby Bridge group and affiliated companies – these services include stockbroking, investments advice, financial planning, superannuation, estate planning, insurance, home loans and mortgages, corporate finance, corporate lending, construction loans, syndicated equity raising and structured finance, property and project development, property investments, property management, corporate travel, a wide range of insurances, information technology consulting and business property and financial consulting.

The opponent has offices in Sydney, Brisbane, Melbourne and on the Gold Coast and in excess of 250 employees and consultants are employed by the opponent, its group and its affiliates.

The applicant provides details of the number of clients and annual turnover of the group – these are not essential to my decision so, while the applicant has not requested confidentiality, I will only mention that they are substantial.

Turning to the mortgages side of the applicant’s business, Mr Braysich states that the applicant has provided mortgage services under the trade mark SAXBY BRIDGE since 1993.  In that year, the applicant established a department under a Mr Ian Dorney which was staffed by a number of consultants.  This department provided home loan and mortgage services to clients of the applicant and its group from 1993 to 1995.

In late 1994, the principal officer of the opponent, Mr Kingston, was recommended to Mr Braysich as a way of growing the mortgage business of the applicant and its group.  Mr Braysich attests to substantially the same course of negotiations as does Mr Kingston in his declarations; however, while the declarants differ strongly on particular issues, these do not affect the outcome in these proceedings so I will not mention them.

In Braysich 3, Mr Braysich provides documentation that shows that the opponent has ceased using the name SAXBY BRIDGE MORTGAGES and is now called Gainsworth Mortgages.

Discussion of evidence

I note that the opponent does not present reliable evidence of the trade mark’s reputation in terms of section 60 of the Act.  It is true that the opponent presents a claim in percentage terms of the total of the Saxby Bridge Group’s mortgage business – however, these figures are disputed by the applicant and the opponent does not state what the total of this business was, how many mortgages were initiated, what the rate of customer contact was or the amounts expended on advertising by the opponent in relation to the trade mark.  I thus have no true basis for any assessment on the evidence by which I could infer a reputation.  Further, the reputation in the trade mark would, I consider, only accrue to the opponent if there were to be a positive finding in terms of section 58 that the opponent is the owner of the trade mark. 

Neither has the opponent presented evidence which appears obviously to go to sections 41, 42, 43, 44 or 59 of the Act or state why those sections are relevant – there is nothing I can find in the opponent’s evidence that suggests that these sections might operate in relation to the applicant’s trade mark.  Accordingly, the opponent cannot, in terms of section 55 of the Act, establish its grounds under those sections and I accordingly dismiss the opposition in terms of those sections.  The sole ground that remains is under section 58.

Section 58

Section 58 of the Act provides:

58  Applicant not owner of trade mark

The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

Note:          For applicant see section 6.

Under the Trade Marks Act 1995, the word ‘owner’ has the same meaning as that of the word ‘proprietor’ in the Trade Marks Act 1955 and its predecessors.  In Shell Co. of Australia Ltd. v. Rohm and Haas Co. (1949) 78 CLR 601 Dixon J said, at paragraph 7 of his judgment:

But, however that may be, it is clear enough from the course of legislation and of decision that an application to register a trade mark so far unused must, equally with a trade mark the title to which depends on prior user, be founded on proprietorship. The basis of a claim to proprietorship in a trade mark so far unused has been found in the combined effect of authorship of the mark, the intention to use it upon or in connection with the goods and the applying for registration. For a time the provision that application was equivalent to prior user necessarily embodied in statutory form the conclusion that the applying for registration completed title to the unused mark, where the other elements existed. But the principle had been already adopted by Cotton L.J. in In re Hudson's Trade Mark (1886) 32 Ch D 311 . (at p628)

Authorship of course includes claim through or under the author. But it involves the origination or first adoption of the word or design as and for a trade mark. This is well brought out by the Victorian case of Re Hicks's Trade Mark (1897) 22 VLR 636 which was decided on legislation in much the same form as the English Act of 1875. Hicks had obtained registration of the word "Empress" for stoves. A stove, the design of which had been registered, had been sold under the name Empress by the predecessors in title of Metters Brothers. Metters Brothers moved to rectify the register by expunging Hicks's trade mark. For Hicks it was argued that prior user by him was unnecessary and that by registration he had made himself proprietor of the mark. In the course of the argument Holroyd J. said: - "A person cannot be properly registered unless he is the proprietor. Proprietor is the person who at the moment he makes application to be registered is entitled to the exclusive use of the name, whether he then or before publicly adopted it. A man cannot be said to have adopted a name if someone else has done so before him. Section 19 merely says that the act of applying is to be deemed equivalent to public user. No one could otherwise be entitled to registration as proprietor unless he had publicly used the trade name before. The section does not affect the fact that another person used the name first. The difficulty here is that although Hicks may have by virtue of his application publicly used the name, someone else publicly used it before him." (1897) 22 VLR, at p 639 . (at p628)

In delivering the judgment of the court his Honour said: - "For the reasons given by us in the course of the argument, we think this application to expunge Hicks's name from the register of trade marks as the proprietor of the word 'Empress' as a trade mark applied to stoves ought to be granted. In order to substantiate his application to be placed on the register for this word he must have claimed to be the proprietor, and the word 'proprietor' must be taken to mean the person entitled to the exclusive use of that name. If there is anyone else who would be interfered with by the registration of the word 'Empress' in the exercise of a right which such person has already acquired to use the same word in application to the same kind of thing, then Hicks ought not to have been put on the register for that trade mark, and his name will be properly removed on the application of the person whose right of user was thereby disturbed" (1897) 22 VLR, at p 640 . (at p628)

The trade marks involved, SAXBY BRIDGE and SAXBY BRIDGE MORTGAGES are substantially identical trade marks and the services are the same services, at least as far as the mortgage services of the opponent are concerned.  The question for me to decide is whether the rights of the applicant which arise from the filing of the application are displaced by any rights of the opponent which might arise from its earlier use of the trade mark.  Moreover, it follows that if, in fact, the applicant used the trade mark in relation to mortgage services earlier than did the opponent, that use will establish the applicant’s ownership of the trade mark in relation to those services.

I think that it is quite plain from the evidence that the opponent must fail under this ground for two reasons.  In the evidence of Mr Kingston, he says Mr Braysich advised him during the negotiations that, “Mortgages at the moment are a dirty word [among companies in the Saxby Bridge group].  All of the top guys have lost good clients with the slip ups through the mortgage part of the existing company.”  [Parenthetical material added].  Mr Kingston also later states in his declaration that (in 1995 after the opponent began operations) “there was a reluctance on the part of the applicant’s consultants to have anything to do with the new company because of the previous personnel in the mortgage divisions of the applicant who had lost clients because of incompetence and delays in approvals”.  I think that I must read into these statements an acknowledgement on the part of Mr Kingston that the applicant had earlier been using the words SAXBY BRIDGE as a trade mark in relation to mortgage services – if this was not so, the applicant could not have had any of the alleged slip ups in relation to the services.  It may or may not be, as Mr Kingston alleges, that the service might not have been perfect; however, the service is an earlier use of the trade mark by the applicant in relation to these mortgage services.  This acknowledgment on the part of Mr Kingston is consistent with the evidence of Mr Braysich who says that the applicant had used the trade mark since 1993 in relation to mortgage services.

Further, I think that it is obvious from the evidence that any use that the opponent had of the words SAXBY BRIDGE as a trade mark was only with the consent of the applicant and that the consent indicates the true ownership of the trade mark.  In his evidence, Mr Kingston says, in Kingston 2 at paragraph 4, that the applicant “consented to the opponent’s use of the trade mark SAXBY BRIDGE in relation to mortgage, home loan and financing services and in fact never used the trade mark in respect of these services”.  While Mr Kingston is wrong on the basis of his own evidence that the applicant had never used the trade mark in relation to mortgage services (as discussed above), I think that the statement is a clear acknowledgement on the part of Mr Kingston that the applicant was the owner of the trade mark as any use of the trade mark could only be with the applicant’s consent or permission.

Accordingly, the opponent has not established its opposition in terms of sections 55 and 58 of the Act and I find that the opposition has not been successful.  I therefore direct that the application proceed to registration, subject to payment of the requisite fees and if no appeal is filed against these reasons within the allowed period.

Costs

The applicant has requested, and is entitled to, its costs in this matter.

Ian Thompson
Hearing Officer

15 October 2001