Television Food Network GP v Food Channel Network Pty Ltd

[2010] HCATrans 303

[2010] HCATrans 303

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane   No B33 of 2010

B e t w e e n -

TELEVISION FOOD NETWORK GP

Applicant

and

FOOD CHANNEL NETWORK PTY LTD ACN 079 015 339

Respondent

Application for special leave to appeal

FRENCH CJ
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 12 NOVEMBER 2010, AT 9.40 AM

Copyright in the High Court of Australia

MR R. COBDEN, SC:   May it please the Court, I appear with my learned friend, MR J.S. COOKE, for the applicant.  (instructed by Bennett & Philp Lawyers)

MS J.R.BAIRD, SC:   May it please the Court, I appear with my learned friend, MS P.L. ARCUS, for the respondent.  (instructed by Potts & Co Lawyers)

FRENCH CJ:   Yes, Mr Cobden.

MR COBDEN:   Thank you, your Honour.  Your Honours this case raises what the applicant submits is an important issue of what happens if, at the conclusion of a trademark opposition under the Trade Marks Act 1995, the state of the evidence under the application of the Act is such that a doubt remains about whether a trademark should be registered. Our case is that on the proper construction of the Trade Marks Act 1995 and, in particular, section 55, in that circumstance the question of registration should be decided against the applicant for registration. That will be so even if the opponent has not established, in the sense of made out fully, any ground of opposition that it raised. In that respect, we contend that the present will ‑ ‑ ‑

FRENCH CJ:   When you say a doubt, do you mean a reasonable doubt?

MR COBDEN:  A doubt sufficient to exercise the mind of the registrar and the authorities referred to the registrar’s state of mind as being in dubio and take it no further than that.  By referring to those authorities, your Honour, of course I am referring to the previous law and it is our respectful submission that the present law, in this aspect, remains the same as the law under the Trade Marks Act 1955 and 1995.

Now, that is quite different, of course, to the new situation under the 1995 Act where, at the examination and acceptance stage, there is what is called conveniently the presumption of registrability and that was as your Honour the Chief Justice said in Woolworths v Registrar was a shift in position from the previous law.  The conclusion for which we contend we say follows from the words of the relevant provisions of the Act read in the context of the Act and as confirmed by reference to extrinsic materials. 

There are three passages of the Full Court judgment that we submit are critical for this application for special leave.  The first is paragraph 28 of the Full Court’s reasons which is page 85 of the application book and that is where the Full Court construes section 55(1) of the 1995 Act.  There are echoes of that paragraph 28 in other paragraphs – 34 and 39 of the Full Court’s reasonings and I will go to those, but that is the main location of that finding.

To succeed on this application and on any appeal, we would need to persuade your Honours that the Full Court’s construction of section 55 is wrong.  However, we accept that that alone would not be sufficient.  We would also need to persuade your Honours that in light of the Full Court’s findings about the state of the evidence before it and the trial judge, on the construction we propound registration would be refused on either or both of the remaining grounds of opposition.

GUMMOW CJ:   What is the point of construction of section 55?

MR COBDEN:   The point of construction of section 55 is effectively whether ‑ ‑ ‑

GUMMOW J:   Just looking at the text which appears at paragraph 20 of the reasons ‑ ‑ ‑

MR COBDEN:   It does your Honour, yes.

GUMMOW J:   In the Full Court.

MR COBDEN:   Quite so, your Honour.  The Full Court says in the last sentence of paragraph 28:

In particular, s 55 of the Act expressly contemplates that registration may be refused at the opposition stage only “to the extent (if any) to which” a relevant ground of opposition “has been established”.

We submit that that is not the case.

GUMMOW J:   Well, how do you read the words?

MR COBDEN:   We read the words in this way, your Honour.  The registrar must decide to refuse to register the mark or to register the mark.  That is the decision invested in the registrar.  The registrar has regard to the extent, if any, to which any ground has been established but the decision is back in the registrar’s province.

FRENCH CJ:   What it is required by the words “has been established”?

MR COBDEN:   What is required by that?

FRENCH CJ:   Yes.

MR COBDEN:   The consideration to be taken to the extent to which, for example, the opponent has made out such a ground but on one reading of it the registrar, if one reads one of his disjunctive approaches, must at the end decide to register the mark having regard to the extent, if any, to which a ground has been established.  In other words, the registrar can decide to register the mark having regard to a ground that may not have been established at all and may only have been established in part or, to refuse to register the mark having regard to such a ground.

The question of construction is what does the word “decide” invest in the registrar and what is the meaning of having regard to the extent, if any, to which a ground has been established.  It is there, we will submit, your Honour – I will take your Honour briefly to the points we make – that looking at the history of the Act and its antecedents and the intention of the legislature in making very few changes, that at that point, and using very similar wording in the previous legislation, the registrar so decided, looking at all the material before the registrar, and if there was any doubt in the registrar’s mind remaining, and that would include if a ground of opposition has not been made out, but equally it has raised a question of non-registrability which has not been dealt with appropriately by the applicant, if the registrar was in any doubt then the application was determined against the applicant for registration and was refused.

I will come back in due course to what we say about the two grounds.  We say that if the Full Court’s findings are left undisturbed on the two grounds we maintain in section 58, ownership, and section 59, lack of intention to use, they are expressed in such a way that if the burden did fall on the applicant for registration, the present respondent, then there was doubt and, on the authorities, that doubt would be resolved against taking the step of registration. 

In order to appreciate that your Honours, could I just remind your Honours briefly of the stages of the life of a trademark application and registration and this was dealt with in overview by your Honours in the Full Court of this Court in Health World recently.  First, there is the stage of application examination and acceptance.  Limited grounds are available to the registrar to refuse an application.  That is section 31 of the Act.  It is not reproduced in the judgment but it says that the registrar must report on whether there are grounds for rejection.

Section 33 of the Act, which is in a bundle we have provided for your Honours but your Honours are doubtless familiar with it, says that the – we have provided a bundle behind tab 17, that is some provisions of the Act – this is at the application stage, that the registrar must after the examination accept the application unless there are grounds for rejecting it.  That is the presumption of registrabiliy and by that wording, one then expects to see some grounds somewhere enumerated and they are enumerated in Part 4, Division 2.  That is the acceptance and examination phase.

Then there is the opposition phase and the structure of the Act is to say that almost all grounds on which the mark could have been rejected are available and also some additional grounds are available to the opponent and this is all dealt with in Part 5 of the Act.  If your Honours have that bundle it is instructive to look at the way in which Part 5 is constructed because we say that the Full Court and the respondent, as it were, misapplied some introductory words to each of the grounds of opposition.

If your Honours have Part 5 and section 52 behind our tab 17, your Honours see that opposition arises if the mark has been accepted.  Critically, 52(4):

The registration of a trade mark may be opposed on any of the grounds specified in this Act and on no other grounds.

So that leaves one, under the structure of this Act, to expect to find in due course that the grounds will be somewhere enumerated.  They are enumerated in Division 2 in section ‑ ‑ ‑

FRENCH CJ:   We are looking at 58 and 59?

MR COBDEN:   Yes, your Honour.

FRENCH CJ:   Can you point to the proposition, the constructional proposition in the Full Court’s judgment that is erroneous, as distinct from a complaint you might have about its application to the facts of this case.

MR COBDEN:   Yes, your Honour.  Paragraph 28 which I just took your Honours to:

s 55 of the Act expressly contemplates that registration may be refused at the opposition stage only “to the extent (if any) to which” a relevant ground . . . “has been established”. 

FRENCH CJ:   Yes.

GUMMOW J:   What is wrong with that?

FRENCH CJ:   It is citing the section.

GUMMOW J:   It seems to refer to the section.

MR COBDEN:   The word “only” is not in the section, your Honour.

GUMMOW J:   It says “having regard to”.

MR COBDEN:   Quite so.

GUMMOW J:   And if it is having regard to something else, then you would expect Parliament to say so.

MR COBDEN:   Well, we would submit, your Honour, if Parliament intended to say that the application should be rejected, must be rejected if a ground of opposition has been made out or to the extent that a ground of opposition has been made out, then Parliament would have said that.

FRENCH CJ:   What else would the registrar have regard to that is excluded by this erroneous use of the word “only”?

MR COBDEN:   Your Honour, the registrar would have regard to the state of any doubt about the application that was raised by the opposition and the material in the opposition.

FRENCH CJ:   Well, that is all wrapped up in the question of what is meant by “has been established”, is it not?

MR COBDEN:   Yes, your Honour. 

FRENCH CJ:   And “to the extent”, et cetera.

MR COBDEN:   Yes.  The error of the Full Court ‑ ‑ ‑

GUMMOW J:   Prima facie, one would have thought that the establishment has to be by the proponent of the ground, namely the opponent.

MR COBDEN:   Yes, your Honour, but ‑ ‑ ‑

GUMMOW J:   Just as a matter of language.

MR COBDEN:   Quite so, your Honour.

GUMMOW J:   And commonsense, maybe.

MR COBDEN:   Yes.  But, what happens if the ground has been established to some extent, at which the legislative language refers to, what does the registrar do with that and what does the registrar then decide in the way it is described in the opening words of that paragraph?  This is perhaps a slightly strange expression “decide at the end”.  Can I take your Honours to two other passages where the Full Court, we say ‑ ‑ ‑

GUMMOW J:   Well, “to the extent” reflects the circumstance that it may be that the registration goes ahead.  See 55(1) poses a double possibility – refusal or registration. 

MR COBDEN:   Yes, your Honour.

GUMMOW J:   Then the words that follow have to accommodate both contingencies.

MR COBDEN:   Yes.

GUMMOW J:   This may explain the somewhat awkward language, maybe, having regard to the extent.

MR COBDEN:   It may explain it.  If there is some doubt about that your Honour, there are some ‑ ‑ ‑

GUMMOW J:   You could have written the section out twice, really.

MR COBDEN:   Yes, or one could have used what the Act often uses which is that something will happen if, but only if, something particular has happened, that is to say if, but only if, a particular ground has been made out.  Your Honour, if there is doubt about that and we would submit that what your Honour has just said there could be some doubt about it, the extrinsic materials do take it a bit further.  Can I just get to those very shortly? 

But I will just identify, your Honour, a couple of other places where we say the Full Court repeats that an error.  In paragraph 34 on application book page 87, the Full Court relies on two linguistic matters to say that the burden falls entirely, as it were, on the opponent and there is no burden, as it were, left on the applicant.

The first linguistic matter the Full Court relies upon is at section 55 which I have just dealt with, and the second one is the opening phrase of each of the grounds of opposition:

the registration of a trade mark may be opposed –

We say that that second point which is that each of the grounds is prefaced by the phrase “the registration of a trade mark may be opposed” is entirely accounted for by that structural and textual legislature that I took your Honours to earlier, that is to say, section 52(4) says there are going to be specifically enumerated grounds of opposition.  We promise you will find them somewhere and in the organisation of this particular Act they were found by being gathered together in Part 5.  That is in distinction to the 1955 Act where they were scattered around as conditions of registrability and the like, and then paragraph 39, where ‑ ‑ ‑

FRENCH CJ:   Just before we leave paragraph 34, what was the - succinctly stated that Television’s argument which was being rejected at that point?

MR COBDEN:   Sorry, your Honour.

FRENCH CJ:   The Court says:

presents an insuperable obstacle to Television’s argument.

MR COBDEN:   Television’s argument – that if there was doubt ‑ ‑ ‑

FRENCH CJ:   That is how you would characterise what was put to the Full Court then.

MR COBDEN:   Yes.

FRENCH CJ:   All right.

MR COBDEN:   I am sorry.  My learned friend has corrected me, I was not there.  The argument that a burden still fell on the applicant for registration ‑ ‑ ‑

FRENCH CJ:   That is a bit different from saying there is doubt.  There was a shifting burden proposed, was there not?

MR COBDEN:   Yes.  It, ultimately, in the circumstances of this case, means the same thing – that because we say there was doubt - if the applicant carried the onus and there is doubt, then the applicant failed to carry the onus here because the Full Court held that we carried the onus, particularly, the onus of persuasion of the registrar to decide, under section 55, that the mark should be rejected or accepted.  The historical position, your Honour, which we say is ‑ ‑ ‑

FRENCH CJ:   Sorry, you were going to take us to one other passage.

MR COBDEN:   I am sorry, your Honour.  Yes, paragraph 39:

the opponent either has a case or it does not.

If we are correct that the notion of the registrar having to decide, having regard to certain matters, but still the decision being invested back in the registrar without a presumption of registrability under section 55, then it would not be decisive that the opponent did not have a case because if sufficient doubt had been cast on the registrability of the mark by the opposition process, it falls back to the registrar to make the decision.  The applicant for registration is, as the old cases put it in petitorio, the petitioner for the right and any question of doubt we say, on the old authorities which are not displaced by the wording of section 55, the applicant for registration has to persuade the registrar at the final moment - “at the end”, as it says in section 55, that the mark is appropriate for registration.

FRENCH CJ:   How does this differ from a proposition that if the opponent raises evidence which puts before the registrar material which, if answered, would support an inference that, for example, there was lack of intention to use and there is no material in opposition to that, that the registrar may draw the inference that there was ‑ ‑ ‑

MR COBDEN:   That is one circumstance.

FRENCH CJ:   That is not a shift in onus.  That is just an inferential process.

MR COBDEN:   I would agree with your Honour.  That is one of the circumstances of a certain extent of a ground being made out and if the applicant either does not answer it or if the applicant’s answer does not dispel the doubt that has been raised, then we say that we are in that territory.

FRENCH CJ:   Dispel the doubt or displace the inference that is otherwise available.

MR COBDEN:   Ultimately, dispel the doubt.  Your Honour, it is really beyond question, we would submit, that the position certainly up to the 1995 Act was that the applicant for registration was ‑ ‑ ‑

FRENCH CJ:   Just looking for this in the language of the Act, of course.

MR COBDEN:   I am sorry.  Yes, your Honour.  For the reasons we have advanced we would say it is in the language of the Act because the registrar must decide “having regard”, if any, “to the extent (if any)”, et cetera.  I will not repeat that.  But if there is some ambiguity about what that decision process involves by the registrar, in other words what is the registrar doing and who bears the burden of persuading him at that point, him or her, that the decision should go one way or the other – if that is an ambiguity then it is resolved by reference to the historical material because, your Honour, there is no doubt that the applicant for registration under the 1955 and 1905 Acts remained, to use that expression, in petitorio, and if there was doubt, it was resolved against the applicant for registration.

That comes out of the cases we have put in our outline - Eno v Dunn and picked up by this Court in 1914 in Robert Harper v A Boake Roberts and under the 1905 Act, kept on going under the 1955 Act right through to Campomar.  The 1995 Act came into being by reason of a review that was undertaken by a discussion paper and a working group report.  That is the origin of the presumption of registrability.  The working group made 57 recommendations of which all but three were explicitly accepted by the government in the second reading speech your Honour the Chief Justice referred to again in Woolworths. 

One such recommendation, which is in our bundle of extrinsic materials, is behind tab 18 – the extract from the working party’s report.  I am not suggesting this trumps the legislative language but, in the way in which I have put it would assist.  Your Honours will see pages 6 and 7 of the working party’s report.  There is a recommendation, 8, “Post‑acceptance (but before registration) grounds for refusal” and 8C, on the right‑hand page, looking horizontally:

In opposition proceedings the onus should continue to be generally on the applicant to justify registration and if the matter is left in doubt, it should be resolved against the applicant.

The second reading speech which is behind tab 19, on the second page, about five paragraphs from the bottom ‑ ‑ ‑

GUMMOW J:   Yes.  The question is what is it that engenders the doubt?

MR COBDEN:   Yes.

GUMMOW J:   And, that is spelled out now in section 55.

MR COBDEN:   Yes.

GUMMOW J:   Previous legislation was rather terse.

MR COBDEN:   Quite so, your Honour.  Perhaps put another way, your Honour, that if the process of ‑ ‑ ‑

GUMMOW J:   Whose task is it to engender the doubt?

MR COBDEN:   Yes.  We say that we certainly engendered sufficient doubt, your Honour, because the Full Court ultimately, in making the findings about the section 58 ground and the section 59 ground said that there was a doubtful state of affairs.  On the section 58 ground, this being a mark that was admittedly a used mark, there was doubt raised by the opposition process and by the evidence as to whether Channel, which is the applicant company ‑ ‑ ‑

GUMMOW J:   Yes, but the notion of doubt is substituted in a way by the expression “established”, is it not?  The word “doubt” did not appear in the previous legislation.

MR COBDEN:   No, your Honour, but ‑ ‑ ‑

GUMMOW J:   Judicial gloss.

MR COBDEN:   Yes, but a very respectable one, with great respect.

GUMMOW J:   Of course.  That does not dictate section 55.

MR COBDEN:   No, your Honour, but the word “decide” is the one that carries the freight, as it were.  What is the registrar going to do when the registrar reaches this decision?  We say it is not entirely governed by the question of whether an opponent has established, in the sense of prevailed on, a ground of opposition.  Here, we say in this case, the petition is clearly, on the Full Court’s findings, first of all that on ownership the Full Court was ethically unable to say which of Channel and Network – Channel being the applicant, Network being the assignee but another competing company in the same group for the title of first user – the Full Court at paragraph 71, effectively says in the state of the evidence, one cannot decide this ‑ ‑ ‑

FRENCH CJ:   This was a function of Mr Lawrence’s confused affidavit, was it?

MR COBDEN:   Yes, your Honour, among other things, and I do not need to go to all of that.  I just rely on the only finding of the Full Court in this area, section 58, which is in conclusion under this ground of opposition:

it may well be said that both Network and Channel used the mark, but it cannot be said that Network rather than Channel was the first party to use the mark.

Of course, in the case of a used mark, as opposed to an unused mark, a first user will prevail and, as the Full Court says at the end, and we would not be seeking to disturb this, of that paragraph:

In this state of confusion, the incidence of the onus of proof means that the lack of clear evidence as to prior use is a fatal deficit in the opponent’s case, not in the applicant’s.

In our submission, if that indicates that there is doubt about who the first user was and, we say it does, it has been raised by the opposition process, the doubt remains and it should have been resolved against the applicant, not against the opponent.  The opponent is, in effect, as was referred to in Health World, there assisting the registrar for the purity of the register. 

Similar observations - I see the light your Honour - covered in our submissions are made in respect of section 59, intention to use.  Similarly, the position is left in doubt and we would respectfully submit that that means that the matter should have been resolved against the applicant for registration.

FRENCH CJ:   Thank you, Mr Cobden.  Yes, Ms Baird.

MS BAIRD:   Your Honours ‑ ‑ ‑

FRENCH CJ:   Ms Baird, at paragraph 39 at page 88, their Honours referred to the judgment of Justice Jacobson in Health World and reference to the shift of the evidentiary onus and then they seem to suggest that that cannot operate really in relation to section 58 because the opponent either has a case or it does not.  Do you see that?

MS BAIRD:   Yes, your Honour.  I am just finding it.

FRENCH CJ:   Yes.

MS BAIRD:  

the opponent either has a case or it does not.

FRENCH CJ:   Yes.  It is not clear from that whether their Honours are, in effect, confining the non‑application of the onus‑shifting principle to section 58 grounds, leaving it open in other grounds, or quite what they are doing on the constructional side of it.  Perhaps if we could focus on that.

MS BAIRD:   Your Honours, the Full Court had before them three grounds, only two of which are relevant today – section 44, section 58, and section 59.  The Full Court ‑ ‑ ‑

FRENCH CJ:   The focus of it all seems to be onus, really, does it not?

MS BAIRD:   Yes, yes. 

GUMMOW J:   And intention to use an authorship.

MS BAIRD:   Yes, your Honour.  Intention to use an authorship comes from originally, if we are looking at previous legislation, section 40 of the 1955 Act which was claimed to be proprietor.  When it came to the 1995 Act, the legislation reflected those concepts and of the law behind those concepts in section 27.  Section 27, your Honours, is set out at the Full Court at page 81, paragraph 15.  The concept of what your Honour Justice Gummow has identified as the authorship and intention to use is split in section 27 into two parts in 27(1)(a).  First, that:

A person may apply for the registration of a trademark . . . if:

(a)the person claims to be the owner -

So, that is registration claiming by filing:

and

(b)one of the following applies:

(i)the person is using or intends to use the trade mark in relation to goods and/or services -.

So that the old concepts in Eno v Dunn and in Jafferjee v Scarlett and as were discussed by the High Court in Shell v Rohm and Hass and again in Aston v Harlee are now found in section 27 so that is a ground - the basis on which a person may apply for the mark, a claim to be the owner and intention to use.

When it comes to opposition, section 27 finds it correspondence in two separate grounds of opposition.  They are sections 58 and 59.  They are set out, your Honours, at pages 82 and 83 of the application book in paragraph 22 of their Honours’ reasoning.  In relation to section 58, it reflects the first part of section 27(1)(a), namely the claim to be owner. 

Turning to your Honour Justice French’s inquiry when the Full Court then at section 39 is saying that an ownership by prior user, what the Full Court was directing its mind to was given that the longstanding principle, even under the old Act, that a mark may be unused but be registered and that the filing itself, in the case of an unused trademark for specific goods and services, evidences or an inference arises that that is ownership and is intention to use.  Aston v Harlee and Justice Fullagar sets that out and that is set out by the Full Court at paragraph 67 of their Honours’ reasonings at page 97.  So, section 58 then is usually concerned with something to displace the filing ‑ ‑ ‑

FRENCH CJ:   Their Honours seem to be contrasting the position between 58 and 59, I suppose, if one looks to the beginning of paragraph 38.

MS BAIRD:   Yes.  Your Honour in Health World, Justice Jacobson - the extent to which his Honour Justice Jacobson set out this question of the transfer of owners was only directed to 59 and the underlying concept as is set out in paragraph 38 repeating Justice Jacobson’s reasonings is that there is a subjective element, if you like, to intention.  There is no subjective element to prior user, either there is a prior user or there is not.  Section 58 is concerned with, is there or is there not a prior user.

FRENCH CJ:   Well, does this notion of shifting onus mean anything other than that if the applicant has not provided an answer to evidence from which an adverse inference may be drawn, the adverse inference may be drawn? 

MS BAIRD:   Yes, your Honour.  What that means, however, is that it is on the balance of probabilities because you have section 55 which says “having regard to the extent” to which it is established.  So we start with the inference available by filing that the applicant is the owner of the trademark application.  Section 58 says a mark may be opposed on the basis that the applicant is not the owner.  The Full Court, in our submission, correctly held that that assertion must be proved by he or she who asserts – namely, if you assert that someone else is the owner, that is that the applicant is not the owner therefore there must be another owner, then that must be proved and proved on the balance of probabilities on the civil standard and that there we are looking at what evidence there was before the Full Court to displace the finding that is available by filing.

The Full Court made express findings on this matter at paragraph 61.  Paragraph 61 at page 95 of the application book is concerned with the affidavit of Mr Lawrence and the totality of the evidence, and in paragraph 61, at the end of line 30, 31:

In this case, this evidence does not establish that Network was the prior owner through use -

quite clearly a finding that Network, the party asserted by Television, the applicant in this Court, to be the prior owner was, in fact, not the prior owner.  The court goes on to say it may be that Network did use the mark.  However, that does not negate that Channel might have used it but there is no evidence at line 34:

as to how the mark was used by Network.  Use needs to be in relation to the goods or services claimed -

Here, class 16 -

there was “no set formula” with regard to use.  This tends against a conclusion that any mark was used by Mr Lawrence, Network or Channel to distinguish one company’s goods from another.

In other words, as a trademark for the specified goods.  If it did use the mark, the evidence does not say.  There was no evidence of an attempt to use it to distinguish its goods from those of Channel.  Then the Court went on as to the inherent unlikeliness of Mr Lawrence’s mind to do so.

Your Honours at paragraph 62 at page 96, the Full Court then goes on to state that that suggestion that exclusive or permitted use by Channel, ie as first owner, is counterintuitive.  The Court then goes on at paragraph 64 to say that this is a manifestation of the unnecessary search:

for ‘an owner’ (by reason of use) at the time of registration –

What Television, the appellant in the court below, asserted was that there had to be found a prior user prior to the application date.  Television also asserted in its notice of opposition and in its notice of appeal to the single judge in the Federal Court, that Network was not the owner.  So the whole of the confusion that may have arisen arose because of the opponent’s mischaracterisation of the test under section 58.

The opponent asserted that the assignee, Network, was not the owner.  Mr Lawrence, acting on his own behalf and those of his companies, in his affidavit using a definition of network, then addressed that allegation that Network was not the owner.  The Full Court says at paragraph 70 ‑ ‑ ‑

FRENCH CJ:   Paragraph 66 is where they, as it were, sum up the facts and apply the onus, is it not – their Honours’ conclusion?

MS BAIRD:   Well, your Honour, we are looking just at 58 at the moment and at 58, first of all there has to be evidence of somebody else using the mark.  The only evidence there was, prima facie as suggested, that it was the applicant, Channel.

FRENCH CJ:   Yes, well that is what they say.

MS BAIRD:   The Full Court does not need to go so far because at paragraph 70 the Full Court, having referred to and taken cognisance of Aston v Harlee in the presumption by filing, says:

Given the available inference of use from the fact of application for registration, and the absence of evidence to rebut that inference, the Registrar’s delegate correctly concluded that Channel was entitled to register –

Paragraph 71 then, to which my friend took your Honours, must be read in light of the preceding paragraphs, that is the Full Court has actually found there was no prior user in Network.  It cannot find that there was prior user by Channel, that is that there is no use by the applicant before the date of application, although at paragraph 66 there is suggestion that there is that use and there, in that circumstance, the primary position is not displaced and an express finding at 61, Network is not the prior user.

So it may be that Channel was the first user before application date; that cannot be found.  It is the case that Channel is the applicant by filing and that, on whichever way the onus lies, carries the day.  Contrary to my friend there is no doubt in this case and contrary to my friend the concept of doubt is one that is an unnecessary gloss on the words of the section which provide:

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

FRENCH CJ:   The onus‑shifting proposition is to be found in relation to section 59 in paragraph 72, I think.

MS BAIRD:   Yes, your Honour.  The onus‑shifting proposition, whether indeed that is a correct proposition ‑ ‑ ‑

FRENCH CJ:   I am just a bit uneasy about that nomenclature, I suppose.  I know it has been around, but if all we are talking about is circumstances in which inferences may be drawn then ‑ ‑ ‑

MS BAIRD:   Ultimately, your Honour, the delegate had before them the whole of the evidence and on the whole of the evidence the registrar is directed as provided by section 55 - regard to the extent, if any, to which any ground has been established.  Is it established on the balance of probabilities?  If it is established then the acceptance is revoked.  The mark is not registered, it is refused.  If it is not established then the previous existing state of affairs should continue.  It is not established, the presumption of registrability which led to acceptance carries through.  There is the acceptance and it is registered.  The words “the extent (if any)” are directed, as your Honour Justice Gummow proposed to my friend, in relation to 55(1)(b):

to register the trademark (with or without conditions or limitations) -

Section 6 of the Act provides that a mark may be registered with limitations as to geographic area, as to use, as to mode of use and non‑exhaustively.  Thus, if a ground of opposition is established for a geographical territory within the greater territory of the Commonwealth of Australia, it may be that the trademark can proceed to registration, limited to those other States and Territories ‑ ‑ ‑

GUMMOW J:   The adoption of shifting onuses may not be favourable to you, but it is a bit unfortunate in the sense that this is after all an administrative proceeding for the registrar, not litigation in the ordinary sense.

MS BAIRD:   The concept of the shifting of onus in section 59 arises, as I have said, by the subjective nature of the intention.  It may not be correct, but it is according to the statute and the reading of the text.  But it is what ‑ ‑ ‑

GUMMOW J:   It makes lawyers feel more comfortable, this expression.

MS BAIRD:   Maybe, but effectively it is saying if ‑ ‑ ‑

FRENCH CJ:   I may be oversimplifying it, I am coming back to what I said before and looking at what the Full Court says at paragraph 72:

Once an opponent has made out a prima facie case that there was a lack of intention to use a mark, it has been held that the onus shifts to the applicant –

Does that carry with it any more magic than the proposition that if the opponent has made out a prima facie case and the applicant either stands silent or does not put anything in which in any way responds to it, the registrar can find that, as a matter of inference, of the necessary factual matters that the ground is established?

MS BAIRD:   Yes, on the balance of probabilities the ground is established.  There has been material put forward, which prima facie ‑ ‑ ‑

FRENCH CJ:   Onus is like phlogiston, it sort of shifts from one thing to another.

MS BAIRD:   Ultimately in the whole of the case we say that the Full Court correctly found that onus lies on the opponent.  In relation to section 59 what the Full Court said was the opponent did not shift that onus.  It did not establish a prima facie case of shift of onus.  It did not have to go any further and, your Honours, the Full Court deals with the matter at paragraph 74 at the bottom of page 98.

GUMMOW J:   The opponent did not establish the relevant ground of opposition under section 59.

MS BAIRD:   No, it did not.

GUMMOW J:   That is all you need to say, I suppose.

MS BAIRD:   Yes, it did not establish that there was no intention to use.  Added to that the Full Court found additional material, which supported the applicant’s case – the applicant for registration’s case – in the intention expressed by the controlling mind of both companies, which evidence was not cross‑examined on, was not challenged at all and so the prima facie case of a lack of intention was not established even at that prima facie lack of intention by the opponent.  Further, there was evidence after the date of application from which could be read back inference of intention at the application, and that evidence, your Honours, is at paragraph 82 at page 102.

Your Honours, I do not need to take your Honours further to that evidence, save to say that it made clear that after assignment, Network had used the mark in relation to the provision of recipes.  Those recipes had themselves the trademark and corporate ABN details of Channel.  So evidence both earlier use by Channel in relation to recipes and 2004 use by Network.  The Full Court is, consistent with authority, entitled to look at behaviour after the application date to see if an intention is made good, is made actual by conduct. 

Your Honours, section 55 sits in the Act in a structure which the Full Court has dealt with, in our respectful submission, correctly and comprehensively.  Your Honours, it is a change from the previous law.  The previous law provided at all stages that the applicant for registration had to establish the entitlement to registration.  That is clear from the words of the 1905 Act and from the 1955 Act.  Under the 1995 Act, under section 33, it is for the registrar to be satisfied on the balance of probabilities that there are grounds for rejecting the mark, in other words there is a presumption of registrability. 

The concluding words of section 55 did not exist in the preceding law, rather, under section 50, as I have said in my outline, under section 50(1) and paragraph (2) of the 1955 Act the registrar could have regard to a ground of opposition, whether relied on by an opponent or not.  In other words it was a true re‑examination of all of the grounds of entitlement.  That means that the applicant was, at an application date, in

the same position as it was at examination.  In the present legislation the registrar may only have regard to those grounds of opposition that are actually identified, to the extent they are established.  There are specific grounds of opposition. 

Section 52 provides that a mark may be opposed on specified grounds and no other grounds.  Thus, there is a, if you like, re‑examination or a re‑consideration of registrability, only to the extent that a ground is listed in the opposition.  Your Honours, unless I can assist you further.

FRENCH CJ:   Thank you, Ms Baird.  Yes, Mr Cobden.

MR COBDEN:   Two very brief points, your Honours.  Aston v Harlee and that authority for the proposition that by filing an application that carries with it an implication of ownership and intent, is confined in terms to unused marks, whereas this mark – both the respondent and the Full Court accept, and indeed advance the proposition, it was a used mark.  So that conclusion does not follow from the mere fact of application.

A different way of framing our point without making it a different point might be this, that in a case such as this case where a ground of opposition may be established to the extent that it raises a real, but not a trivial doubt about the registrability of the mark, that really is perhaps another way of putting this shifting onus point or it harmonises the wording of section 55 on our approach to the legislative intent to which we have taken your Honour and the question of shifting onus.

The registrar then has a body of material before the registrar, but still has to do that thing of decide something.  If we are correct about the antecedence of the legislation that decision is done on the whole of the material and if there is doubt, whether it is raised by arguments put up by the opponent, material put up by the opponent or, indeed, material that perhaps is put in, in answer to the opponent by the applicant that further confuses the situation, that would be a way, in our respectful submission, of harmonising all those matters.

In relation just to the short point on section 59 my learned friend just addressed latterly, the Full Court found there in relation to the wrong party – that is to say Network, the assignee, after acceptance and some months after application that use by Network might support an inference of an intention to use by Channel some months before a different company.  We simply say that that inference would not be supported in any event.  May it please the Court.

FRENCH CJ:   Thank you, Mr Cobden.  We will just retire briefly to consider what course we take.

AT 10.25 AM SHORT ADJOURNMENT

UPON RESUMING AT 10.29 AM:

FRENCH CJ:   This application for special leave raises questions which in various ways relate primarily to the onus of proof in opposition proceedings under the Trade Marks Act 1995. The Full Court of the Federal Court allowed an appeal against the decision of a judge of the Court by which her Honour on an appeal against a decision of a delegate of the Registrar of Trade Marks directed that registration of the trade mark in issue in this application be refused.

The decision of the Full Court on the constructional questions raised in the special leave application, in our opinion, was substantially correct, although we are not to be taken as endorsing the general application of notions of shifting onus in opposition proceedings.  In our view, the result was correct.  Special leave should be refused with costs.

AT 10.30 AM THE MATTER WAS CONCLUDED