Weeks, J. Pty Ltd v Foodland Association Ltd

[1986] FCA 271

Re: JOHN WEEKS PTY. LTD.
And: FOODLAND ASSOCIATED LIMITED; RONALD MULLIGAN; JOSEPH GUIPPA
and NEVILLE GALE
No. WA G50 of 1986
Trade Marks

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Toohey J.

CATCHWORDS

Trade Marks - application under Trade Practices Act to restrain use of name and mark - prior application for removal for non-use pending before Registrar of Trade Marks - application to remove trade mark proceedings into Federal Court - whether Federal Court a prescribed court under Trade Marks Act - whether application to Registrar within associated jurisdiction of Federal Court - power of court to order removal of application

Federal Court of Australia Act 1976 ss.23, 32

Trade Marks Act 1955 s.23

HEARING

PERTH

#DATE 4:7:1986

JUDGE1

Before the Court is a dispute between the applicant and the first respondent as to the use of "Bi-Lo" both as a name and as a trade mark in the business of wholesale distributor and retailer of groceries which each company carries on.

1. The applicant is the registered proprietor of trademark No. B370,430 consisting of the trade mark Bi-Lo registered in Part B of the Register of Trade Marks in respect of retailing through supermarkets, being services included in Class No. 42. Registration of the mark was granted to the applicant on 20 December 1984 and subsists for a period of seven years from 14 January 1982.

2. The applicant was incorporated in South Australia and since May 1979 or thereabouts it has carried on business in that State. The first respondent was incorporated in Western Australia and it has registered the name Bi-Lo pursuant to the provisions of the Business Names Act 1962 of this State. The first respondent uses the name Bi-Lo in the course of its business and it has, by franchise agreements, given the other respondents the right to use that name.

3. The applicant has brought proceedings against the respondents, pursuant to s.52 of the Trade Practices Act 1974 and on other grounds, seeking to restrain the respondents from using the name Bi-Lo in their businesses and in particular to restrain them from using the name in the course of trade as a mark. Although no defences have yet been filed to the statement of claim, it is apparent that these proceedings will be defended.

4. On 25 October 1985, the first respondent lodged with the Registrar of Trade Marks an application under sub-s.23(1) of the Trade Marks Act 1955 for an order that the mark be removed from the Register in respect of all of the services for which it is registered "insofar as the State of Western Australia is concerned". The grounds of the application are that the first respondent has been the proprietor of the business name Bi-Lo Stores since 1 February 1980 and that the applicant has never used the mark Bi-Lo in Western Australia. On 16 April 1986 the applicant lodged notice of opposition to the application by the first respondent, contending that the mark had been used by it since May 1979 and that extensive good-will attached to the trade mark and the applicant's reputation in the name Bi-Lo throughout Australia.

5. The respondents have moved this Court for an order that the applicant's claim be stayed pending disposal of the first respondent's application under the Trade Marks Act. However, when the motion came on for hearing, counsel for the respondents asked the Court to order removal of the application under the Trade Marks Act into the Court. The object of this course was to avoid concurrent proceedings in the Federal Court and before the Registrar in which common issues would have to be determined. Counsel for the applicant supported this course. Both counsel urged that this Court has power to order removal of the trade marks application and jurisdiction to deal with that application. I have no doubt that what counsel seek makes good sense and will avoid unnecessary duplication of time and money. The question however is whether the Court may do what is asked of it. The question does not appear to have arisen before.

6. Sub-section 23(6) of the Trade Marks Act provides that if the Registrar considers that an application made to him under the section "ought to be decided by a prescribed court", he may refer the application to such a court which "may hear and determine the application as though it had been made to the prescribed court in the first instance".

7. Sub-section 6(1) of the Act defines "prescribed court" to mean "the Supreme Court of a State, the Supreme Court of the Australian Capital Territory, the Supreme Court of the Northern Territory of Australia or the Supreme Court of Norfolk Island". No mention is made of the Federal Court. Nevertheless, in Browne v. Smith & Son Pty. Ltd. (1985) 60 ALR 431 Neaves J. said at 435:
   
   

"It would seem necessary, in order that the court might exercise the jurisdiction conferred on it by s.32(1) of the Federal Court of Australia Act 1976 (Cth) in a case such as this, to read the reference in s.23(1) of the Trade Marks Act 1955 (Cth) to a 'prescribed court' as including a reference to this court. It may be said that so to read the provision is to depart from the literal meaning of the words of the statute, but it is, I think, permissible to do so in order to give effect to the obvious intention of the legislature as expressed in s.32(1) of the Federal Court of Australia Act 1976 (Cth): Cooper Brookes v. F.C. of T. (1981) 35 ALR 151; 147 CLR 297 at 304-5, 310, 319-21."

1. With respect to his Honour, I am unable to read the references to "prescribed court" in s.23 of the Trade Marks Act in this way. Other considerations aside, there was no Federal Court of Australia in existence when the Trade Marks Act was passed. Sub-section 32(1) of the Federal Court of Australia Act reads:
   
   

"To the extent that the Constitution permits, jurisdiction is conferred on the Court in respect of matters not otherwise within its jurisdiction that are associated with matters in which the jurisdiction of the Court is invoked".

It may be that the effect of sub-s.32(1) is to confer on the Federal Court jurisdiction to deal with the removal of a trade mark from a register, where that matter is associated with a matter in which the jurisdiction of the Court is invoked, as for instance in a claim under s.52 of the Trade Practices Act. But to say that sub-s.32(1) has that effect is quite different from saying that the reference to "prescribed court" in the Trade Marks Act includes the Federal Court which is not mentioned either expressly or by implication.

1. Judicial opinions differ as to the meaning and operation of sub-s.32(1) of the Federal Court of Australia Act. But there is common ground. No one would quarrel with the statement of Barwick C.J. in Philip Morris Inc. v. Adam P Brown Male Fashions Pty. Ltd. (1980-1981) 148 CLR 457 at 478:
   
   

"The evident endeavour of the section is to increase the jurisdiction of the Federal Court beyond the federal jurisdiction which is attracted in relation to the matter".

The difficulty arises in giving content to the term "associated" so as to define the scope of matters in respect of which jurisdiction is conferred by sub-s.32(1). Various tests were propounded in Philip Morris Inc. v. Adam P. Brown Male Fashions Pty. Ltd. - Barwick C.J. and Murphy J. accepting jurisdiction in regard to any question or claim which, although not necessary for a decision on the matter where jurisdiction exists by reason of a law of the parliament, is not separate and disparate from that matter; Gibbs and Wilson JJ. confining the associated matter to one which it is necessary to decide in order to determine the matter in respect of which jurisdiction is expressly conferred; and Stephen and Mason JJ. treating an associated matter as one which although not necessary for a decision on the matter for which jurisdiction is expressly conferred, is not severable from that matter.

1. The views of their Honours also differed as to whether sub-s.32(1) operates in such a way as to confer jurisdiction on the Federal Court in respect of matters for which the federal parliament has legislated or whether it is enough that the associated matter is within the legislative competence of that parliament. A further question arose as to whether sub-s.32(1) operates so as to confer jurisdiction on the Federal Court in respect of a matter arising under State law if that matter is truly associated with the matter in respect of which jurisdiction had been expressly conferred.

2. None of these problems, I think, arises in the present case for the matter in respect of which it is said that the Federal Court has associated jurisdiction is a matter arising under a law of the Commonwealth viz. the Trade Marks Act. The question rather is whether a claim that a trade mark be removed from the register pursuant to sub-s.23(1) of the Trade Marks Act has a sufficient connection with the claim made in the Federal Court that the use of that mark by the respondents constitutes misleading or deceptive conduct on their part.

3. Both claims concern the use in Western Australia by the first respondent (and other respondents) of the name and mark Bi-Lo and the lack of use by the applicant. Both claims "so depend on common transactions and facts that they arise out of a common substratum of facts" (Mason J. in Philip Morris Inc. v. Adam P. Brown Male Fashions Pty. Ltd. at p 512 - see also Rolls-Royce Motors Ltd. v. D.I.A. (Engineering) Pty. Ltd. (1981) 50 FLR 340).

4. If the conclusion that the associated jurisdiction of the Federal Court extends to the application to the Registrar be correct, the appropriate course is for the respondents to file a cross-claim in the Federal Court echoing the relief which they claim in their application to the Registrar or such other relief as they may think appropriate. There may be a difficulty for the respondents if they adopt that course and it arises from the significance that the period of one month before application has under para.(b) of sub-s.23(1) of the Trade Marks Act. That paragraph, upon which the first respondent relies, grounds an application where
   
   

"up to 1 month before the date of the application, a continuous period of not less than 3 years had elapsed during which the trade mark was a registered trade mark and during which there was no use in good faith of the trade mark in relation to those goods and services by the registered proprietor ...".

Sub-s.23(6) operates so that if the Registrar refers an application to a prescribed court, that court may determine the application as if it had been made to the court in the first instance. In practical terms, the court approaches the matter as if the application to remove the trade mark from the register had been made to the court on the date on which the application was filed in the registry. It does not follow that the Federal Court must or even may take the same approach if removal of the trade mark from the register is sought by way of cross-claim. The period of one month may be differently calculated. That matter was not fully argued and I do not think I should express a view on it, particularly as no cross-claim has been filed.

1. If there is a difficulty such as I have mentioned, it would be overcome no doubt if this Court could, by analogy with sub-s.23(6), order the removal of the respondents' application to the Court.

2. I am not persuaded that this Court has power to make such an order which even a prescribed court is not empowered to make. (Prerogative writ proceedings before a prescribed court may raise different questions.) Section 23 of the Federal Court of Australia Act empowers the Court, in relation to matters in which it has jurisdiction "to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate". The section is wide in its terms but is generally aimed at the parties to the litigation before the Court. A party might be restrained, by injunction, from prosecuting an application under sub-s.23(1) of the Trade Marks Act. But that is of no assistance in the present case if the first respondent is content not to prosecute its application to the Registrar while its claim is dealt with in this Court. If it concludes that it is disadvantaged by proceeding by way of cross-claim, it may prefer to continue before the Registrar, notwithstanding the inconvenience that course may produce. But that must be a matter for the first respondent.

3. This Court will, in an appropriate case, restrain a party from proceeding in a State court in respect of a matter which is within the jurisdiction of the Federal Court and which is convenient to be dealt with by this Court. But the Federal Court does not assert any mandate in respect of State courts so as to direct those courts what they may or may not do. The Court's powers are exercised in regard to the parties before it. See St. Justin's Properties Pty. Ltd. v. Rule Holdings Pty. Ltd. (1980) 40 FLR 282 at 285. It is true that the Registrar of Trade Marks is not a court but s.23 confers on him the same powers as it confers on a prescribed court. I am not to be taken as suggesting that in an appropriate case an injunction will not lie against the Registrar as ancillary to an injunction against a party to proceedings before the Federal Court (that question does not arise). But that is quite different from ordering the removal of an application into this Court. Such an order would, I think, be beyond the scope of s.23 of the Federal Court of Australia Act.

4. In summary then, I am of opinion that this Court may entertain by way of cross-claim a claim by the present respondents or any of them to remove the applicant's trade mark from the register. The Court however may not direct the Registrar to remove the proceedings before him to this Court. In the light of these conclusions, I shall hear from counsel as to the appropriate orders to be made.