| IN THE FEDERAL COURT OF AUSTRALIA | 1 |
| QUEENSLAND DISTRICT REGISTRY | |
| GENERAL DIVISION | ) |
BETWEEN: TRACEY LEE WICKHAM
Applicant
AND: ASSOCIATED POOL BUILDERS PTY LTD
First Respondent
AND: GEOFFREY JAMES RAMSEY
Second Respondent
AND: HALHAPIN PTY LTD
| -: | SPENDER J. |
| PLACE : | BRISBANE |
| - | DATE : | 19 March 1992 |
REASONS FOR JUDGMENT
This is the further hearing of
involving the sale of swimming pools by use of the applicant's
name.
On 23 September 1988, at the request of counsel for the parties, I dealt with questions of liability between the parties and published reasons. This occurred after the hearing of oral evidence and after the receipt of extensive written submissions by counsel instead of oral addresses. It is unnecessary to repeat those reasons, but I concluded tha.t
| on ten working days' notice, and I reserved costs. |
the applicant had made out breaches of ss. 52 and 53(c) of the Trade Practices Act 1974 ('the Act'). I indicated that I would hear the parties further and I adjourned the matter to the registry to be brought on by any party to the proceedings
An appeal and cross-appeal were filed in the Pull Court concerning the conclusions I had reached but I am informed by counsel for the respondents that leave to appeal was refused. My conclusions on liability expressed in those reasons were interlocutory. Some time later, the matter came on for further hearing.
In the course of final submissions Mr Bowden of counsel, who appeared for the first, second and fifth respondents, indicated that the Full Court had in effect indicated that counsel for the respondents could attempt to persuade me that I was in error in the conclusions to which I earlier came. He said:
| " ... | al though we do not concede y o u r Honour i s |
| r i g h t , | we | do | n o t | a t t e m p t | to | persuade | your |
| Honour | t o a n y c o n t r a r y v i e w for | t h e purpose | of |
| now making | s u b n ~ i s s i o n s about | quantum. | " |
| In that respect I have already found that the agreement reached between Miss Wickham and Associated Pool Builders Pty Ltd ('APB') was that APB was entitled to use the applicant's | name in the context of promoting sales of swimming pools for | the period of the agreement. I rejected the contention that |
| APB had acquired the right to use the name 'Tracey Wickhamt or 'Tracey Wickham Pools' in perpetuity, and I held that the agreement between Miss Wickham and APB was never intended to confer any 'ownership' rights in respect of the name 'Tracey Wickham'. Reaching that conclusion, I rejected the evidence of Mr Ramsey, the second respondent, and Mrs Marion Adams, in preference to the evidence of Miss Wickham and Mrs Foster in relation to the agreement reached at the National Hotel in December 1982. |
| The evidence establishes that some $150,000.00 to $200,000.00 was spent by APB in advertising. The double medal logo and the words 'Tracey Wickham' feature prominently in all that advertising. It was clearly represented that the pools had the sponsorship and approval of Tracey Wickham, and that she endorsed their quality. The written material included photographs of the applicant as well as written endorsements. An instance of such endorsement was: |
" Hello, I'm Tracey Wickham, and I'd like to tell you about Tracey Wickham Pools.
All my training has shown me the necessity of discipline, planning and a 'no compromise' approach, in the quest for success.
Ours is a product to be proud of.. .every step in the manufacture is quality-controlled to produce the best possible pool for you.
The people who install our pools have been carefully selected because of their experience, expertise and, most importantly, their reputation for jobs well done.
| Even after all the excitement of competition, a | thing to remember is that swimming is fun. I |
| wish you years of pleasure from your Tracey |
| |
This was followed by the applicant's signature. The commendation appears underneath a photograph of the applicant in swimming costume.
The assessment of whether conduct of APB subsequent to the termination of the agreement was misleading or deceptive has to be made on the basis that during the currency of the promotions agreement, it was widely represented by the first respondent that its business and products were closely affiliated and connected with Miss Wickham, were sponsored and approved by her and the first respondent sought to exploit the applicant's reputation to sell pools.
I am satisfied that the promotions agreement was terminated by 16 February 1986. I am not satisfied that Miss Wickham was in breach of that agreement and, in particular, clause 5. The cross-claim is therefore dismissed. The obligation to make personal appearances in my view required some specificity as to the time and place of the appearance and that there be reasonable notice of such requirement and that the proposed time and date for a personal appearance did not unreasonably call for disruption of Miss Wickham's prior commitments. I am satisfied that Miss Wickham's failure to attend in Alice Springs in late 1984, at a time when she had her leg in plaster, was not
| November 1985 in Cessnock when she had an earlier engagement | unreasonable and the same applies to her non-attendance in |
| to be bridesmaid at a wedding. The occasions referred to in evidence by Mrs Adams and Mr Ramsey were not the subject of any written complaint to Miss Wickham and, in my opinion, the alleged breaches are not put forward bona fide but are advanced belatedly in an attempt to justify the otherwise unexplained failure to pay royalties to Miss Wickham to which she was clearly entitled. |
| The first aspect of relief for the applicant concerns the period during the currency of the promotions agreement. There is no claim as such for moneys due and owing but the application does seek an account and no point is taken by counsel for the respondent that it would be inappropriate to award an amount for unpaid royalties. |
| The evidential material is unsatisfactory both in respect of the amount to be awarded under this head and in respect of damages pursuant to S. 82 for loss or damage suffered as a consequence of contraventions of ss. 52 and 53(c). This is the fault of the respondents. There has been a lack of primary material such as cashbooks, ledgers, and journals, and no sequential record of invoices has been discovered. In addition, the evidence of Mr Ramsey, particularly as concerns the records and accounting procedures of the respondents, was vague, non-responsive and evasive. There is therefore a larger degree of estimation than ought properly to be the case. |
| Based on the information in Exhibit 23 when compared with the details of payments made to Tracey Wickham scheduled in Exhibit 1, I am satisfied that there is an underpayment to the end of September 1985 in respect of 23 pools; there being an underpayment of 1 in March 1985, 1 in June 1985, 13 in July 1985, 6 in August 1985, and 4 in September 1985. There is an overstatement of 2 in respect of the December 1984 figures. I am therefore satisfied that there ought to have been paid to | |
Miss Wickham by October 1985 the sum of $1,150.00 more than she in fact received.
In the months October 1985 to 16 February 1986, again based on Exhibit 23, I am satisfied that the number of pools in respect of which Miss Wickham was entitled to payment from APB were in October - 33, in November - 35, in December -
17, in January - 26, and to 16 February - 16. The total
amount of unpaid royalties to 16 February was $7,500.00 calculated on 150 pools, 23 of which were unpaid in the months prior to October 1985 and the balance for the months of October 1985 to 16 February 1986.
Because of a feared impecuniosity in APB, Mr Stephens, counsel for the applicant, sought bravely to establish some fiduciary obligation in the third respondent to make the payments which were the primary obligation of APB. There is no evidence which would permit any such finding and, in respect of this aspect of the matter, I give judgment for
| of $7,500.00. In my opinion, Miss Wickham is entitled to | the applicant against the first respondent in the primary sum |
| interest at 12 percent on that figure, which I will calculate from 1 January 1986 to take account of the fact that part of this money should have been paid before that date and some paid after it. After some rounding off the amount of money to be awarded in respect of interest is $5,590.00, making a total against APB in respect of unpaid royalties of $13,090.00. |
| As earlier indicated, I am satisfied that in the period subsequent to 16 February 1986, APB's conduct in continuing to conduct its business as 'Tracey Wickham Pools' and to sell its product as a 'Tracey Wickham Pool' was in contravention of ss. 52 and 53(c). The promotions agreement contemplated that it might be terminated in the circumstances therein set out. Subject to earlier termination, it was for a fixed term. There is no factual basis for any estoppel on which APB can rely. A party cannot rely on its own conduct to engineer an estoppel. APB, by spending money in advertising the nexus between its product and the applicant, is not thereby entitled to believe that on termination of the promotions agreement and the cessation of APB's obligation to pay royalties to Miss Wickham, it could continue as if the agreement was still on foot. In my opinion, in the absence of further agreement, there was no entitlement in APB to expect to be able to use the name 'Tracey Wickham' as part of the name of its business or in connection with its products. |
| The continued use of 'Tracey Wickham Pools' and the description 'a Tracey Wickham Pool' after 16 February 1986, in | the light of the extensive identification between the business | |
| and the product with Miss Wickham in the period prior to 16 February 1986, would convey to the members of the public the impression that the business and the products had the endorsement or approval of the applicant when they did not. The conduct of APB after the termination of the agreement was a representation that nothing had altered, that its business and products were connected with the applicant and was an assertion of an association which it no longer had and was an appropriation of the applicant's reputation for the commercial benefit of APE without any remuneration to the applicant. |
| I am satisfied that this claimed association continued until at least September 1986. The advertisements in the Telecom yellow pages inserted in about August 1985 continued. The entry in the Telecom white pages inserted in about August 1985 continued. APB traded as 'Tracey Wickham Pools' and continued the registration of business names using the words 'Tracey Wickham Pools' and advertised its products using the name 'Tracey Wickham Pools' with the logo. On at least one occasion APB advertised its products as 'Tracey Wickham Pools' in a metropolitan newspaper. From March 1986 to September 1986, Halhapin Pty Ltd ('Halhapin') was the proprietor of the business name 'Tracey Wickham Pools (Southside)'. From September 1986 to July 1987 APE continued some advertising material using the name 'Tracey Wickham |
| Pools' with the logo and continued the Telecom yellow pages | and white pages entries, and APB advertised under the title | |
| 'Landscaping' in the Telecom yellow pages. |
| Mr Ramsey says that Halhapin traded as 'Gateway Pools' from about September 1986 and that a 'Gateway Pool' was quite different from a 'Tracey Wickham Pool'. He said that a 'Tracey Wickham Pool' was a prefabricated pool made in precast concrete sections which were joined together by a steel cable. |
The 'Gateway Pool' on the other hand was a concrete steel pool set up and sprayed on site.
The evidence establishes that on 10 May 1987 a large billboard advertising 'Tracey Wickham Pools' was on display at Chandler and the name 'Tracey Wickham Pools' and the logo was on a sign outside the premises of APB at Spine Street, Sumner Park.
Mr Ramsey says that on 19 May 1986 he ordered all references to Tracey Nickham to be removed. This claim sits oddly, not only with his contention at the time of the application for an interlocutory injunction that APB was entitled to use the name 'Tracey Wickham Pools', but also with the continued conduct in telephone directory insertions and his conduct personally in February 1987 when dealing with a Mrs Lunardon. Mrs Lunardon swears, and Mr Ramsey believes it to be correct, that he used a brochure showing 'Tracey Wickham Pools' and the double medal logo on that occasion and gave her
| Pools' with the double medal logo and shows the address of | three visiting cards, each of which is headed 'Tracey Wickham |
| Spine Street, Sumner Park, and the telephone number 376.2200. This number had been transferred to Gateway Pools. The contract with Mrs Lunardon, according to Mr Ramsey, was a contract between Gateway Pools and her. The application for approval of building works to the Pine Rivers Shire Council is in the name of Gateway Pools. |
| Having regard to these aspects of the evidence, it may be that the conduct in breach of ss. 52 and 53(c) continued past September 1986; I am satisfied that it continued at least until the end of September 1986. |
| Miss Wickham, pursuant to S. 82 of the Act, is entitled to be compensated for the loss and damage she has suffered as a result of the contraventions. How is such loss and damage to be assessed? |
| It is asserted on behalf of the respondents that the applicant had to establish which of the pool sales subsequent to 16 February 1986 had come about by reason of misleading or deceptive conduct. It was submitted that there was no clear picture that any one of a number of transactions were brought about by reason of misleading and deceptive conduct of the respondents, and it was said that no attempt had been made by the applicant in these proceedings to pinpoint which were 'infringing transactionsf. |
| In my opinion, it is wrong to approach the matter on the basis that in each pool transaction it has to be established that the representation that it was a 'Tracey Wickham Pool' or was a product of the business 'Tracey Wickham Pools' played a part in that transaction. What Miss Wickham has to be compensated for is the loss and damage suffered as a consequence of the misrepresentation that she continued to have an association with, and give her approval to, the business and the products, which was previously the case and in respect of which she was previously paid. | |
| That loss and damage, it seems to me, can be assessed by considering what would APB have had to pay if it had acted lawfully instead of unlawfully. That amount is a fair measure of the loss and damage suffered by the applicant. There has been a misappropriation of the applicant's goodwill and reputation, the value of which can be measured by the evidence that, prior to the termination of the promotions agreement, APB was prepared to pay $50.00 per pool to Miss Wickham in return for the right to call its business 'Tracey Wickham Pools' and to market its product as a 'Tracey Wickham |
| |
| This approach in my opinion is supported by cases dealing with intellectual property rights. In WEA Records v. Stereo FM (1973) 48 ALR 91, the Copyright Tribunal was concerned to determine the value to 2MMM of the right to |
| broadcast protected recordings. The Tribunal said at 111: | |
| " | 2 M ' s | p r i m a r y | c o n t e n t i o n | was. . . | t h a t | the | v a l u e |
| o f | the r i g h t t o b r o a d c a s t | was | the | amount | which |
| the p a r t i e s | would | h a v e | agreed | i n | ' a r m ' s | l e n g t h ' |
| n e g o t i a t i o n s . | T h i s | ' n o t i o n a l | bargain ' | approach |
| d r e w | h e a v i l y | on | the | a s s e s s m e n t | o f | v a l u e | i n |
| c a s e s | o f | compu l sory | a c q u i s i t i o n , | s u c h | a s |
| SDencer v. Commonwealth (1907) 5 CLR 418. | A |
| s i m i l a r | approach | was | f o l l o w e d | by | the | T r i b u n a l |
| i n | t h e | d e t e r m i n a t i o n | o f | a n | e q u i t a b l e | r o y a l t y |
| u n d e r S . | 5 8 o f the A c t | i n the context | o f the |
| c o m p u l s o r y | licence | c o n f e r r e d | by | S . | 55: | see |
| ' R e p o r t | o f | the | I n q u i r y | by | the | C o p y r i g h t |
| T r i b u n a l | in to | the | r o y a l t y p a y a b l e | i n r e s p e c t | of |
| r e c o r d s | g e n e r a l l y ' | p u b l i s h e d | 24 | December | 1979 |
| ( t h e 1979 | R e p o r t ) | a t p p | 97-9. | In | the | 1979 |
| R e p o r t | a n | e q u i t a b l e | r o y a l t y | was | e q u a t e d | w i t h |
| e q u i t a b l e | r e m n n e r a t i o n | t o | the | c o p y r i g h t | owner. |
| T h i s was | consistent | w i t h | the p r o v i s i o n s | o f | the |
| i n t e r n a t i o n a l | c o p y r i g h t | conventions | t o | which |
| A u s t r a l i a | i s a | p a r t y . |
| T h e | amount | r e p r e s e n t e d | by | e q u i t a b l e |
| r e m u n e r a t i o n | c o u l d | not, | o f | c o u r s e , | be | g r e a t e r |
| t h a n | the | amount | o f | damages | f o r | i n f r i n g e m e n t . |
| I f it were , | there would be no incentive t o g i v e |
| a n y u n d e r t a k i n g | under | S . | 109. | The | r e l a t i o n s h i p |
| b e t w e e n | e q u i t a b l e | r e m u n e r a t i o n | and | damages | i n |
| i n f r i n g e m e n t | c a s e s | was | c o n s i d e r e d | at: | pp | 99-101 |
| i n the | 1979 R e p o r t . | The measure o f damages | i n |
| s u c h c a s e s has been | the | amount | o f r o y a l t y which |
| the | i n f r i n g e r would | h a v e | had | t o p a y | for | a |
| l i c e n c e , | had | he | a c t e d | l a w f u l l y | i n s t e a d | o f |
-
| u n l a w f u l l y : | S t o v i n - B r a d f o r d | v. | Vo l po in t |
| P r o p e r t i e s L t d | 119711 3 | WLR | 256; | 119711 3 A l l |
| ER | 570; | I n t e r f i r m | Comparison | ( A u s t r a l i a l | P t v |
| L t d | v. | Law S o c i e t y o f New | S o u t h Wales | (1975) 6 |
| ALR | 445; | A u s t r a l a s i a n | P e r f o r m i n a | R i q h t s |
| A s s o c i a t i o n | v. | Grebo | T r a d i n g CO P t v L t d | (1979) |
| 2 3 | ACTR | 30. | T h e s e | c a s e s | a ~ p l y | t o | co~vriaht |
-
| c a s e s | the | p r i n c i p l e s | d e v e l o p e d | and | a p p i f e d - i n |
| p a t e n t | c a s e s : | see | General | T i r e and | Rubber CO v. |
| Firestone | T v r e and | Rubber | CO | L t d | [ l 9 7 6 1 RPC |
| 197, | p e r | Lord | W i l b e r f o r c e ( a t 212-5) . | In | those |
| c a s e s | where | the | i n f r i n g e r | d i v e r t s | s a l e s | from |
| the owner the measure of | damages w i l l u s u a l l y |
| be | the pro f . i t | wh ich would | h a v e been | r e a l i z e d by |
| the owner had | the s a l e been made by h i m ( i b i d |
| a t 2 1 2 ) . | In other c a s e s the measure o f damages |
| w i l l be | the sums he would h a v e pa id by way o f |
| r o y a l t y f o r | a | licence | i f he | had | a c t e d l a w f u l l y |
| and n o t u n l a w f u l l y : | ( i b i d a t 212-3) . | " |
| I n Meters | Ld | v . M e t r o p o l i t a n Gas Meters | Ld | (1911) 28 |
| R.P.C. | 157, Fletcher Moul ton LJ s a i d a t 165: |