Green Cabs Limited v Siulua HC Wellington CIV 2010-485-1723

[2010] NZHC 2042

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2010-485-1723

UNDER  The Fair Trading Act 1986

IN THE MATTER OF     a breach of Part 1 of the Fair Trading Act

1986

BETWEEN  GREEN CABS LIMITED Plaintiff

ANDSAGE SIULUA Defendant

Counsel:         N E Flint for the Plaintiff

J W Cameron and K J Patterson for the Defendant

Date:              27 September 2010

ORAL JUDGMENT OF WILD J

[1]      This is an application for an interim injunction.  Prior to 30 March, when his contract was terminated, the defendant, Mr Siulua, was an independent taxi driver contracted to the plaintiff, Green Cabs Ltd.  He was driving a Toyota Prius painted in the plaintiff’s  distinctive  green paint,  Panatone 368C.   Since termination of his contract the defendant has continued to drive his cab with the same paint, although he has removed the plaintiff’s signage and, more recently, has put a sign on the back doors of the cab stating “THIS IS NOT A GREEN CAB”.

[2]      The plaintiff seeks an interim injunction upon the three causes of action in its statement of claim which are:

a)        Breach of contract;

GREEN CABS LIMITED V SAGE SIULUA HC WN CIV 2010-485-1723  27 September 2010

b)Breach of the Fair Trading Act, in particular ss 9 and 11, in short, misleading or deceptive conduct in trade or the provision of taxi services; and

c)       For the tort of passing off.

[3]      In  support  of  the  application  the  Director  of  the  plaintiff  Company,  Mr Callum Brown, has sworn an affidavit.   He gives hearsay evidence about various instances of the defendant continuing to pass his cab off as a Green Cab, including passing out Green Cab name cards with the name of another Green Cab driver deleted and his own name and mobile number handwritten on it.

[4]      The Notice of Opposition and Mr Siulua’is affidavit in opposition essentially admit that Mr Siulua continues to drive his taxi with the same paint or getup, save that all the plaintiff’s signage has been removed.   Mr Siulua denies the conduct alleged by Mr Brown.

[5]      I am satisfied that the threshold for an interim injunction, namely that there is a serious case to be tried, is met.   I am satisfied on the Fair Trading and tortious causes of action, but not on the breach of contract cause of action.  I consider the plaintiff cannot seriously argue that a requirement for Mr Siulua to repaint his cab is either express or implicit in clause 9.2.1 of the Independent Drivers Contract which provides that, upon termination of the contract, Mr Siulua will:

remove from the contract holder’s vehicle all:  identification that in any way associates the contract holder with the company, including removal of any signage.

[6]      I see the essence of the problem as the fact that Mr Siulua continues to drive a taxi with the plaintiff’s distinctive green paint coat.   Even if some of what is alleged against the defendant is not made out there is evidence of patrons being confused, if not misled.

[7]      I turn to the balance of convenience.   The balance of convenience is best described by the phrase, “the balance of the risk of doing an injustice”.  The phrase is that of May LJ in Cayne v Global Natural Resources Plc [1984] 1 All ER 225 (CA)

at 237.  My task is to balance the injustice that will be caused to the plaintiff if I refuse it an interim injunction and it is ultimately granted a permanent injunction, against the injustice that will result to Mr Siulua if I grant an interim injunction against him but it is ultimately discharged at substantive hearing.

[8]      In  practical  terms  the  balance  of  convenience  really comes  down  to  the adequacy of damages.  Will damages be an adequate remedy for the plaintiff if it is denied an interim injunction, but is ultimately successful?  On the other hand, will damages be an adequate remedy for Mr Siulua if I enjoin him from driving his green painted cab on the road, but he is ultimately successful?

[9]      I am well satisfied that damages would not be an adequate remedy for the plaintiff.   There are two reasons for that.   The first is that I accept Ms Flint’s submission that the damage to the plaintiff is damage to its reputation, essentially to the goodwill of its business, and is really inestimable in dollar terms.  Secondly, Mr Cameron tells me that Mr Siulua cannot afford the quoted cost (obtained by Mr Siulua) of $2,475 to have his cab repainted.  It follows that he obviously would not be able to afford or meet any award of damages made against him unless it is very small.

[10]     On the other hand, damages will be a sufficient remedy for Mr Siulua, who is driving his cab as a means of earning a livelihood.  In other words, his interest is money.  On the face of what Mr Brown deposes in his affidavit the plaintiff seems to be well capable of meeting any award of damages.  He deposes that in the 10 months ended 31 January 2010 the plaintiff had a turnover of some $2.2 million, and no substantial debts.   But in evidence is a copy of the financial statements of the plaintiff as at 31 January 2010.  That discloses negative equity of some $526,000. Perhaps  indicative of  that  financial  position  is  the information  contained  in  the affidavit of Mr McKenna filed in opposition.   He deposes that a debt of $6,748 awarded to him against Green Cabs Ltd by the Disputes Tribunal on 19 April this year was only paid on 14 July, after his solicitors had issued a statutory demand.  So the plaintiff’s ability to meet any award of damages that might ultimately be made to Mr Siulua is not at all clear.

[11]     As so often in these situations, I consider that a compromise solution is the one that carries the least risk of injustice to both parties at this interim stage.  I intend granting the plaintiff an interim injunction, but on terms.  Accordingly, I make an order prohibiting Mr Siulua from operating his  Toyota Prius car painted in the plaintiff’s green Panatone 368C paint as a taxi cab, effective immediately.  He can drive the car for private or family purposes.  He may not drive it as a taxi.  I make that interim injunction on the following terms:

a)       The  plaintiff  is  to  pay  50%  of  the  quoted  cost  of  repainting  Mr Siulua’s taxi.   The quote in evidence is $2,475.   Accordingly, the plaintiff is to pay $1,240 (I have rounded it up slightly) of that cost.  It is to make that payment forthwith to Mr Siulua’s solicitors, Thomas Dewar Sziranyi Letts.

b)Although the plaintiff has been successful in its application for an interim injunction there will be no order as to costs.  The reason for that I trust is obvious, but it is simply Mr Siulua’s inability to pay any costs order.  That is a significant concession to Mr Siulua.

Solicitors:

O’Sullivan & Associates, Wellington for the Plaintiff

Thomas Dewar Sziranyi Letts, Lower Hutt for the Defendant