CATCHWORDS
Practice and procedure - interlocutory application for prohibitory and mandatory injunctions - alleged passing off, misleading or deceptive conduct and breach of contract - whether a serious question to be tried - whether reputation established - balance of convenience
Trade Practices Act 1974 s 52
SNOWAVE PTY LIMITED v WANDERERS SKI HOLIDAYS AND TRAVEL PTY LIMITED
No. NG 245 of 1996
CORAM: Lehane J
PLACE: Sydney
DATE: 19 April 1996
IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )
GENERAL DIVISION ) No. NG 245 of 1996
BETWEEN: SNOWAVE PTY LIMITED
Applicant
AND: WANDERERS SKI HOLIDAYS AND
TRAVEL PTY LIMITED
Respondent
CORAM: Lehane J
PLACE: Sydney
DATE: 19 April 1996
MINUTE OF ORDERS
UPON THE APPLICANT BY ITS COUNSEL GIVING THE USUAL UNDERTAKING AS TO DAMAGES THE COURT ORDERS:
1. THAT until further order the respondent by itself, its servants and agents be restrained from:
(a) Passing off or enabling to be passed off its business and/or services
(i) as and for the business and/or services of the applicant;
(ii) as being connected or associated with the business and/or services of the applicant;
(iii) as having the sponsorship or approval of the applicant; or
(iv) in such a way as to represent that it has an affiliation with the applicant.
(b) Using the name, Snowave, or any other substantially identical or deceptively similar word or words
(i) in any advertising of its business and/or services; or
(ii) in connection with any of its services.
The entries in the Yellow Pages of the 1996 Sydney and Melbourne telephone directories referring to Snowave Tours are not to be regarded as in breach of this order.
2. THAT the respondent within seven days cause a telephone message to be placed on its Sydney telephone number 415 1955 until 31 December 1996 or further order, so that any person calling that number will hear words to the following effect:
Thank you for calling Wanderers Ski Holidays. If you are calling for Snowave Snowboard Tours please call Sydney 1800 677 669. For all other snow holiday inquiries please contact us on Freecall 1800 063 063
3. THAT until further order the respondent refer to the applicant any inquiries made to the respondent concerning Snowave.
THE COURT ALSO ORDERS:
4. THAT costs are reserved.
5. THAT both parties are granted liberty to apply on 48 hours notice.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY )
GENERAL DIVISION ) No. NG 245 of 1996
BETWEEN: SNOWAVE PTY LIMITED
Applicant
AND: WANDERERS SKI HOLIDAYS AND
TRAVEL PTY LIMITED
Respondent
CORAM: Lehane J
PLACE: Sydney
DATE: 19 April 1996
EXTEMPORE REASONS FOR JUDGMENT
LEHANE J: This is a motion for interlocutory relief in the form of prohibitory and mandatory injunctions. The applicant carries on business in New South Wales. Its business comprises the provision of snowboarding tours. The evidence of a director of the applicant is that that business is advertised nationally. The respondent is a company which carries on business principally in Victoria. It provides, as its managing director has deposed, packaged ski holidays in the Victorian snowfields. It also appears on the evidence to have some relationship with certain ski resorts in New South Wales.
The relevant facts are briefly
these. The business now conducted by the
applicant was until September 1994 or thereabouts conducted by Mr Murphy as
sole trader. Mr Murphy is now a director
of the applicant. The business has at
all times since October 1992 been carried on under the business name
"Snowave Tours" which is
registered in New South Wales. The
applicant is now the proprietor of that business name.
In about November 1993 there was a discussion between Mr Murphy and Mr Van Wachem, a director of the respondent, in the course of which an agreement was reached. The terms of that agreement are not entirely clear and the parties do not appear to be at one as to the detail of what was agreed. However, what does appear to be uncontradicted is that the respondent was by the agreement appointed to be a Victorian agent of the applicant and that the respondent was granted the right to use the name Snowave for the purpose of advertising in Victoria to attract clients for the applicant's business. I should interpolate here that where I speak of the applicant's business I refer to the business which until September 1994 was conducted by Mr Murphy and at about that time was acquired by assignment by the applicant; where I speak of the applicant as the person conducting the business before the assignment I refer to Mr Murphy.
It also appears to be agreed that the arrangement between the applicant and the respondent ceased at about the end of 1994. Mr Murphy says that this was because that was the time when the agreement by its terms came to an end. Mr Van Wachem disagrees that there was a fixed term to the arrangement; that difference between them I think does not much matter for present purposes.
The respondent took two further steps which are relevant to these proceedings. It caused to be inserted in the Yellow Pages of the Sydney and Melbourne telephone directories for 1995 an entry in each case under the name Snowave Tours. Against each entry there was listed a number, a Melbourne number in the case of the Melbourne directory, a Sydney number in the case of the Sydney directory; both were connected to the office of the respondent in Melbourne. Secondly, the respondent registered in Victoria the business name "Snowave Tours". Mr Van Wachem in his evidence concedes that neither of those two steps was taken following explicit consultation with, or with the express consent of, the applicant. He says, however, that it was necessary, in order effectively to perform the agreement, that the respondent have a telephone book listing in the name of Snowave (or if not necessary then at least desirable) and that he would not have expected that step to be controversial or to require any express consent; he says also that it was necessary to register the business name in Victoria for the purpose of certain regulatory requirements, the details of which were not explored in evidence and again probably do not much matter.
In November 1994 Mr Murphy
says that he first became aware that the respondent had registered the business
name Snowave or Snowave Tours in Victoria.
Oddly enough, because this was apparently at a time when the arrangement
between the parties was still on foot, what Mr Murphy did on making that
discovery was to cause his solicitors to write to the respondent, not directly
referring to the registration of the business name in Victoria,
but rather formally putting the respondent on notice
that
legal action would be taken against any person who used the name Snowave
without the authority of Mr Murphy.
Nothing much seems immediately to have followed from that. Certainly nothing followed in relation to the registered business name until about March 1995, when Mr Murphy says he became aware of what he describes as an unauthorised advertisement in the Yellow Pages of Sydney telephone directory - the entry to which I have previously referred. At that point he says he rang Mr Van Wachem and complained about this, as a result of which Mr Van Wachem replied, according to Mr Murphy, and there appears to be no dispute about this, "Snowave is the name of your business. We undertake to refer all inquiries that we get for Snowave services to you".
There followed a series of letters and conversations the precise course of which it is unnecessary for me to describe. During the course of it the applicant made it clear that it objected to the use by the respondent of the name Snowave. It objected to the registration of the business name by the respondent in Victoria. It objected to the entries in the telephone directories in Sydney and Melbourne. It is fair to say that it received from Mr Van Wachem, and from another director of the respondent, assurances the effect of which was that the respondent had no claim to be, and was not part of Snowave, that it would not continue the entries in the telephone directory in later years and that it would refer to the applicant any inquirers who specifically asked after Snowave or Snowave Tours.
Matters having reached that point, the correspondence was resumed after the applicant discovered that the Yellow Pages of the Sydney and Melbourne telephone directories for 1996 continued to include an entry for Snowave Tours with the telephone number of the respondent. There is, to complete the picture perhaps sufficiently for present purposes, evidence of what might be described as two trap orders, or trap inquiries, in which telephone calls were made to the Sydney number thus listed by persons claiming to be inquiring after Snowave, who were directed not to the applicant but to the respondent's agent, a competitor of the applicant in Sydney.
It is in those circumstances that the applicant seeks relief on the footing of passing-off, misleading or deceptive conduct under the Trade Practices Act and also contract.
The interlocutory relief sought comprises orders substantially as follows. First, orders are sought restraining the respondent from passing-off or enabling to be passed-off its business and/or services as the business and/or services of the applicant, as being connected or associated with that business or those services, as having the sponsorship or approval of the applicant or in such a way as to represent that the respondent has an affiliation with the applicant.
Secondly, the applicant seeks
an order restraining the respondent from using the name Snowave or a
substantially identical or deceptively similar word or words in
advertising the respondent's business and/or services or in connection with any
of the respondent's services.
Thirdly, it seeks interlocutory relief in the form of an injunction requiring the respondent to do whatever may be necessary to change the respondent's advertisements to delete the word Snowave.
Next, the applicant seeks a mandatory injunction requiring the respondent to make arrangements that anyone who calls either of the two listed numbers to which I have referred receives a message including the following words: "This is not the number for Snowave Tours. If you require to speak to someone from Snowave Tours please dial the following number" - there then being stated the applicant's own Sydney number. Finally, the applicant seeks an order requiring the respondent to refer any inquiries concerning Snowave to the applicant.
The argument has followed the
orthodox course of dealing successively with the question whether there is a
serious question to be tried and the balance of convenience, and I shall follow
briefly the same course. I think it must
be said, though with one or two qualifications to which I shall come, that
there is a serious question to be tried.
There is evidence that there was an agency arrangement of the sort I
have generally described between the parties.
There is evidence that the respondent acquired the right, and possibly
was subjected to the duty, for the
purposes of that arrangement, to use in its advertising the name Snowave in
connection with the applicant's business.
It is also, I think, clear on the evidence both of Mr Murphy and Mr Van Wachem, that the use of the name Snowave by the respondent was to be for the purposes of that arrangement and particularly for the purpose of promoting and making available the services provided by the applicant. It also seems clear on the evidence that, except perhaps as a matter of principle, the respondent does not with any degree of enthusiasm assert the right to use the name Snowave for any other business of its own which it conducts. Indeed, to do so would be rather at odds with both its own correspondence which is in evidence and statements made by its own officers of which evidence has been given and not, in relevant respects, contradicted.
It must be said also however
that to the extent of that reputation - that is, particularly, reputation to
which the applicant is entitled in Victoria - the evidence is very slight
indeed. There is Mr Murphy's evidence
to the effect that the applicant's business has been advertised throughout the
Commonwealth including in Victoria.
Beyond that however, and beyond what appears from the evidence as to the
activities of the respondent as Mr Murphy's agent, there is no evidence that
establishes in any clear way a significant reputation built up by the applicant
or by Mr Murphy before it in Victoria.
That of course is a matter which may be relevant ultimately to passing off. It may also be relevant to questions relating
to misleading or deceptive conduct under
the Trade Practices Act. It will
be less so, of course, in relation to any claim arising out of the contract
between the parties.
On the question whether there is a serious question to be tried, however, the applicant has established that it has an entitlement to the name Snowave and to the business name Snowave Tours; there is some evidence from which it might be inferred that the applicant has acquired a reputation in that name in New South Wales, certainly, and perhaps some slight evidence that it has done so in Victoria. There is also evidence that, as between the parties, the respondent as a matter of contract acquired the name for the purpose of fulfilling its obligations and taking advantage of its rights under the agreement between the parties and it can readily enough be inferred, I think, that its entitlement to use the name lasted no longer than the agreement. Indeed, as I have said, the respondent's own conduct is on the evidence clearly consistent with that proposition.
Turning then to the balance of convenience, the evidence certainly establishes that the respondent carries on a substantial business of its own in Victoria and a substantial business on behalf of others, that is other skiing organisations and ski resorts with which it has marketing arrangements. That is reflected not just in the evidence of Mr Van Wachem but also in the numerous entries which appear in the telephone directories, all of which give as the relevant number, either in Melbourne or in Sydney, that of the respondent.
I think it would be tilting the balance too far in favour of the applicant to order the respondent to place a recorded message, or any other sort of message, on its Victorian number which had the effect that anyone who rang was told before anything else occurred that if he or she were looking for Snowave or Snowave Tours the place to ring was the Sydney office of the applicant. In relation to Sydney, however, the matter is rather different. The Sydney directory, like the Melbourne directory, contains a great number of entries under the same Sydney number of the respondent. However, the respondent's counsel made it clear, before the adjournment, that the respondent was not adamantly opposed to a suitable message on the Sydney number. Additionally, it seems clear on the evidence that the applicant's principal catchment area is Sydney; equally it seems clear on the evidence that, particularly in New South Wales, it is the applicant, not the respondent, who is entitled to use the name Snowave Tours, and the respondent accepts that the entry in the Sydney directory is unjustified and occurred through no fault of the applicant and possibly, though not certainly, to some extent through the fault of the respondent. Given all those matters, it seems to me that in the case of the Sydney number a message ought to be placed diverting those seeking Snowave or Snowave Tours to the applicant. The precise form of the message is perhaps a matter requiring further discussion.
As for the other relief sought, although, as I have said, I do not think it appropriate to require, at least on a interlocutory basis, a message of the kind sought by the applicant on the Melbourne telephone number I think it is appropriate that any inquiries for Snowave or Snowave Tours ought to be diverted to the applicant. There appears to be no dispute in the correspondence that that is the appropriate course. There is evidence that that course has not been followed, at least on some occasions, and I think the applicant is entitled to an order substantially in the form of order 6 in the notice of motion.
Additionally, if the applicant presses for it, I think it is entitled to an injunction substantially in the form of that numbered 1 in the notice of motion. That should, however, be on the basis that the mere appearance in the 1996 telephone directories of the entry Snowave Tours, with the respondent's telephone numbers, is not to be regarded as an infringement of the injunction.
As for injunction number 2 sought - requiring the respondent to do all such things as may be necessary to cause advertisements to be changed to delete the word Snowave - I do not think there is any evidence which suggests that such an order is required, simply because there is no evidence of any advertisements issued on behalf of the respondent which include the word Snowave. In the absence of such evidence I think it is unnecessary and inappropriate to make an order of that kind.
Therefore, on the applicant by its counsel giving the usual undertaking as to damages, I would grant an injunction, subject to discussion as to its precise form, in terms of paragraph 1 of the notice of motion, subject to the exception to which I referred. I would also grant injunctions substantially in the form of paragraph 5 and paragraph 6, again subject to further discussion of the precise form which the orders should take; and I think order 7 sought in the notice of motion is appropriate, that is, that costs should be reserved.
I will indicate, so that it will be on the transcript, that in my view, as the evidence now stands, it is appropriate that the order requiring a recorded message on the Sydney number should be in force until the 1997 Yellow Pages are distributed to subscribers.
To be clear about it I shall read on to the transcript what I think are the appropriate orders to give effect to these reasons. They are that on the applicant, by its counsel, giving the usual undertaking as to damages the Court orders:
(1) That until further order the respondent by itself, its servants and agents be restrained from:
(a) Passing off or enabling to be passed off its business and/or services
(i) as and for the business and/or services of the applicant;
(ii) as being connected or associated with the business and/or services of the applicant;
(iii) as having the sponsorship or approval of the applicant; or
(iv) in such a way as to represent that it has an affiliation with the applicant.
(b) Using the name, Snowave, or any other substantially identical or deceptively similar word or words
(i) in any advertising of its business and/or services; or
(ii) in connection with any of its services.
The entries in the Yellow Pages of the 1996 Sydney and Melbourne telephone directories referring to Snowave Tours are not to be regarded as in breach of this order.
(2) That the respondent within seven days cause a telephone message to be placed on its Sydney telephone number 415 1955 until 31 December 1996 or further order, so that any person calling that number will hear words to the following effect:
Thank you for calling Wanderers Ski Holidays. If you are calling for Snowave Snowboard Tours please call Sydney 1800 677 669. For all other snow holiday inquiries please contact us on Freecall 1800 063 063
(3) That until further order the respondent refer to the applicant any inquiries made to the respondent concerning Snowave.
As I indicated, costs will be reserved. As I also indicated, I grant both parties liberty to apply on 48 hours notice.
I certify that this and the preceding 12 pages are a true copy of the Reasons for Judgment of the Honourable Justice Lehane.
Associate:
Dated: 3 May 1996
Heard: 19 April 1996
Place: Sydney
Decision: 19 April 1996
Appearances: Mr M M Macrossan of counsel instructed by Anthony Sunman & Co appeared for the applicant.
Mr I D Roche of counsel instructed by Logie‑Smith Lanyon appeared for the respondent.
