FEDERAL COURT OF AUSTRALIA

Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd [2015] FCA 554

TABLE OF CONTENTS

REASONS FOR JUDGMENT

1    In this proceeding, the applicants seek injunctions and other relief against the respondents for infringement of trade marks and misleading or deceptive conduct. The respondents’ cross-claim for rectification of the Register of Trade Marks (“the Register”).

2    Before considering the case, I feel compelled to say that the expenditure of resources, both by the Court and the parties, on this proceeding seems grossly disproportionate to the scope of the relief sought. On the second day of the trial, I asked the parties whether mediation was appropriate in view of the parties’ indications that the dispute had narrowed. I was told that there was no prospect of settlement and that “The issue that is in the way … is the question of legal costs that the parties have incurred”. I suggested that costs would not ordinarily be much of a barrier to resolution of a proceeding in comparison with the substantive issues and directed the parties participate in a mediation before a Deputy Registrar. The proceeding did not resolve.

3    The trial took eight days. The parties each tendered a very large volume of documents, apparently on the basis that it was all relevant. The written submissions alone exceeded 300 pages. The sheer volume of written material, the number of allegations of trade mark infringements and misleading or deceptive conduct and the number of issues raised in the cross-claim have made this case a particularly onerous one to decide.

4    Sections 37M and 37N of the Federal Court of Australia Act 1976 (Cth) make it plain that the Court is required to facilitate the just resolution of the dispute according to law and as quickly, inexpensively and efficiently as possible, and that the parties are required to conduct the proceedings in a way consistent with that purpose. The parties do not comply with their obligation by engaging in a circular exercise where legal costs are run up to the extent that they become an insurmountable barrier to the resolution of the litigation. It cannot be consistent with the interests of justice for a trial of this length and complexity to be heard and determined for the main purpose, it appears, of ultimately deciding who should pay the legal costs that the parties have incurred. I very much regret that our system of justice could allow this to occur.

THE PARTIES AND FACTUAL BACKGROUND

5    The second applicant, Cairns Harbour Lights Pty Ltd is a property developer. I will refer to that company as “CHL”, except where the context makes it preferable to use its full name. It developed a property consisting of three towers of residential apartments and a retail section at 1 Marlin Parade in Cairns in Far North Queensland. Construction of the complex commenced in September 2004 and was completed in July 2007. The complex is known as “Harbour Lights” or “Cairns Harbour Lights”.

6    The residential part of the Harbour Lights complex consists of two community titles schemes, namely:

(a)    Harbour Lights Community Titles Scheme 36769 (which I will call “the Residential Scheme”); and

(b)    Harbour Lights (Managed Apartments) Community Titles Scheme 36770 (which I will call “the Managed Scheme”).

7    The apartments in the Residential Scheme are larger than those in the Managed Scheme and are designed for owner-occupiers and longer-term tenants. However, the owners of some of the apartments in the Residential Scheme also let them on a short-term basis. The apartments in the Managed Scheme are smaller, lack full kitchen facilities and are like hotel rooms. They are designed to attract tourists and business travellers seeking short-term accommodation. CHL has so far sold approximately 112 of the 191 lots and retains ownership of the remainder.

8    Importantly, CHL is the registered owner of two registered trade marks. The trade marks and the dates of their registration are:

(a)    HARBOUR LIGHTS – 21 January 2009;

(b)    CAIRNS HARBOUR LIGHTS – 21 April 2009.

9    The trade marks are each registered in respect of the following services and classes of services under reg 3.1 and Schedule 1 of the Trade Marks Regulations 1995 (Cth) (“the Regulations”):

(a)    Class 36: agency services for the leasing of real estate properties; commercial real estate agency services; apartment letting agency; apartment rental services; rental of apartments; rental of accommodation; and

(b)    Class 43: accommodation letting agency services (holiday apartments); accommodation letting agency services (hotel); hotel accommodation services; accommodation reservation services; booking services for accommodation; hotel services.

10    On 21 December 2004, CHL caused the body corporate for each of the Residential Scheme and the Managed Scheme to enter into agreements giving Mirvac Hotels Pty Ltd (“Mirvac”) the exclusive rights to provide on-site letting services and caretaking services for the schemes. On 28 September 2010, CHL and Mirvac entered a written agreement granting an exclusive licence to Mirvac to use the trade marks in connection with its letting agency services. The agreement acknowledged that Mirvac had used the trade marks with CHL’s consent since 21 December 2004.

11    In 2012, Mirvac’s name was changed to Accor Australia & New Zealand Hospitality Pty Ltd (“Accor”) following a change in the shareholding of the company. I will generally refer to the company as “Accor”, but sometimes the context will make it preferable to refer to it as “Mirvac”. Accor is the first applicant.

12    Accor acts as letting agent for a number of owners of lots in the Residential Scheme and the Managed Scheme. It manages a pool of apartments which are let to members of the public as short-term or holiday accommodation. It operates its letting business as a 4½ star hotel.

13    Lot owners who wish to let their apartments are free to choose Accor or another letting agent or to arrange the letting themselves. However, only Accor, because of its agreement with each body corporate and the body corporate by-laws, is able to operate on-site. That allows Accor the competitive advantage of being able to offer guests benefits like on-site reception and on-site luggage storage.

14    Accor advertises and takes booking for the apartments it manages through its own website, travel agents, various hotel and apartment listing websites and telephone directory listings.

15    The third respondent, Elise Wyandra Bradnam, purchased an apartment (or, more correctly, purchased a lot) in the Managed Scheme in 2005. Ms Bradnam is referred to by her former surname of Warring in some of the evidence, but I shall refer to her throughout these reasons by her current surname.

16    Ms Bradnam obtained registration of the following domain names on the following dates:

(a)    cairnsharbourlights.com.au – 4 October 2006;

(b)    harbourlightscairns.com.au – 4 October 2006;

(c)    harbourlightscairns.com – 17 January 2007.

17    Ms Bradnam commenced operating a business involving short and long-term letting and sales in respect of apartments in the Residential Scheme and the Managed Scheme from about July 2007. She had earlier established a website which commenced advertising apartments on 31 October 2006 in anticipation of their later availability. When Ms Bradman’s domain names were entered into a web browser they would direct the viewer to the website. Her business traded principally under the registered business name “Harbour Lights Property Management and Sales”.

18    Ms Bradnam advertised her business on her own website and on a number of external hotel and apartment listing websites and on outdoor signs. Ms Bradnam’s business competed with that of Accor in respect of short-term letting.

19    In September 2009, Ms Bradnam entered a contract for the sale of her business to the first respondent, Liv Pty Ltd (“Liv”). The second respondent, Ivana Patalano, is the sole director of Liv and its sole shareholder. Liv trades under the registered business name “Cairns Luxury Apartments”. It competes with Accor in respect of short-term letting of accommodation in the Harbour Lights complex.

20    Liv advertises its business on its own website. Although Ms Bradnam sold her business to Liv, she remains the registrant for the domain names cairnsharbourlights.com.au and harbourlightscairns.com.au. Ms Patalano is the registrant for harbourlightscairns.com. Entering those domain names into a web browser directs customers to Liv’s website. Liv also advertises on a number of external hotel and apartment listing websites.

21    The respondents submit that the complex is generally known as “Harbour Lights” or “Cairns Harbour Lights”. There are signs attached to the buildings that say “Harbour Lights” and “Cairns Harbour Lights”. The words “Harbour Lights” are part of the relevant community titles schemes and of each body corporate for those schemes. In their advertising materials for the sale of lots in the community titles schemes, CHL promoted the property as “Harbour Lights” or “Cairns Harbour Lights”. Ms Bradnam’s uncontested evidence was that lot owners were encouraged by CHL to include “Harbour Lights” as part of their address. “Harbour Lights” forms part of the ordinary postal address of the occupants of the complex. I accept that the complex is generally known as “Harbour Lights” or “Cairns Harbour Lights” to lot owners and members of the public.

22    The applicants’ case is that the respondents have infringed their trade marks and engaged in misleading or deceptive conduct through the use of the domain names, through the content of their websites, through other advertising and through the use of email addresses and business names.

23    The applicants seek injunctions restraining Liv and Ms Patalano from infringing their trade marks and from engaging in misleading or deceptive conduct. The applicants seek an order that Ms Bradnam transfer the domain names to them. They seek an account of profits in respect of the alleged infringements of their trade marks. During their final address they foreshadowed an application to further amend the originating application to seek declarations (which the respondents indicated they would oppose).

24    In their cross-claim, the respondents seek orders that the Register be rectified by cancellation of the registration of the trade marks or removal or amendment of the entries.

25    I will not decide what relief I should grant until after I have delivered my reasons concerning the substantive allegations and heard submissions as to the appropriate orders.

26    As it is convenient to use a number of abbreviations, I will provide a glossary at the end of these reasons.

27    I will consider the cross-claim first, and then consider the applicants’ allegations of infringement of their trade marks and misleading or deceptive conduct.

THE CROSS-CLAIM: RECTIFICATION OF REGISTER

28    The cross-claimants, Ms Patalano and Ms Bradnam, have applied pursuant to s 88(1) of the Trade Marks Act 1995 (Cth) (“TMA”) for orders that the Register be rectified. Section 88 provides:

(1)    Subject to subsection (2) and section 89, a prescribed court may, on the application of an aggrieved person or the Registrar, order that the Register be rectified by:

(a)    cancelling the registration of a trade mark; or

(b)    removing or amending an entry wrongly made or remaining on the Register; or

(c)    entering any condition or limitation affecting the registration of a trade mark that ought to be entered.

(2)    An application may be made on any of the following grounds, and on no other grounds:

(a)    any of the grounds on which the registration of the trade mark could have been opposed under this Act;

(b)    an amendment of the application for the registration of the trade mark was obtained as a result of fraud, false suggestion or misrepresentation;

(c)    because of the circumstances applying at the time when the application for rectification is filed, the use of the trade mark is likely to deceive or cause confusion;

(e)    if the application is in respect of an entry in the Register—the entry was made, or has been previously amended, as a result of fraud, false suggestion or misrepresentation.

29    There no dispute that the cross-claimants have the standing to apply under s 88(1) of the TMA.

30    For the purposes of s 88(2)(a), it is necessary to identify the grounds upon which registration of the trade marks could have been opposed. Part 4 of the TMA (ss 27 – 51A) deals with applications for registration of trade marks. It is Part 4 in its form prior to the commencement of the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth) that is relevant to this case.

31    Section 33(1) provides that the Registrar must, after examination, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act or there are grounds under the Act for rejecting it. The grounds for rejecting an application are set out in Division 2 of Part 4 (ss 39 – 44). The grounds on which registration may be opposed are contained in Division 2 of Part 5 (ss 57 – 62A). Section 57 provides that registration of a trade mark may be opposed on the grounds upon which registration may be rejected.

32    The grounds upon which the cross-claimants seek cancellation of the trade marks or removal or amendment of the entries are as follows:

(a)    the trade marks are not capable of distinguishing the services of CHL or Accor from the services of others: s 41 TMA;

(b)    the use of the trade marks would be contrary to law because their use would be likely to mislead or deceive consumers into believing that CHL or Accor are the sole owners of the apartments in the Harbour Lights complex, or are the sole provider of letting services for apartments in the Harbour Lights complex: s 42 TMA;

(c)    the trade marks have a connotation that would deceive or cause confusion: s 43 TMA;

(d)    because of the circumstances at the time the cross-claim was filed, the use of the trade marks is likely to deceive or cause confusion: s 88(2)(c) TMA;

(e)    CHL is not the owner of the trade marks – the owner being Ms Bradnam or Liv: s 58 TMA.

33    I will start my consideration of the cross-claim with the cross-claimants’ argument that CHL is not the owner of the trade marks.

Section 58 TMA – Ownership of the trade marks

34    One of the grounds for opposition of the registration of a trade mark, and therefore for cancellation or removal or amendment of an entry in the Register, is set out in s 58 of the TMA. That section provides:

The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

35    The cross-claimants argue that Ms Bradnam is the owner of the trade marks because she was the first user of the trade marks “Harbour Lights” and “Cairns Harbour Lights” in relation to at least some of the services in respect of which the trade marks are registered. That first use is alleged to have occurred in October 2006 when her website went “live” and she commenced advertising three apartments in the development for rental or letting. Ms Bradnam then started renting or letting the apartments in about July 2007 using the business name “Harbour Lights Property Management and Sales”.

36    The cross-respondents, CHL and Accor, dispute that the marks used by Ms Bradnam are substantially identical to the registered trade marks and dispute that she used the marks in relation to the same kind of services as those in respect of which the trade marks are registered. I will call the services in respect of which the trade marks are registered the “Class 36” and “Class 43 services” for convenience.

37    The cross-respondents submit that CHL used the trade marks in relation to each of the Class 36 and Class 43 services as early as 2004, and that Accor did so from 2005. The cross-claimants dispute that the cross-respondents used substantially identical trade marks prior to October 2006 in relation to all but one of the Class 36 and Class 43 services and dispute that the marks were used as trade marks.

The case law concerning ownership of trade marks

38    Section 58 does not define who the owner of a trade mark is, or specify how ownership is to be determined. The principles stem largely from the case law rather than directly from the TMA. However, there is an overlap with the law concerning infringement under the TMA.

39    In Shell Co of Australia Ltd v Rohm & Haas Co (1949) 78 CLR 601 Dixon J, speaking of previously unused trade marks, said at 627:

[I]t is clear enough from the course of legislation and of decision that an application to register a trade mark so far unused must, equally with a trade mark the title to which depends on prior user, be founded on proprietorship. The basis of a claim to proprietorship in a trade mark so far unused has been found in the combined effect of authorship of the mark, the intention to use it upon or in connection with the goods and the applying for registration.

40    Dixon J said at 628 that “Authorship … involves the origination or first adoption of the word or design as and for a trade mark.”

41    Where a person has used a trade mark prior to the application for registration, the person is regarded as the owner of the mark, providing that another person has not made first use of it: Colorado Group Ltd v Strandbags Group Pty Ltd (2007) 164 FCR 506 at [5] per Kenny J. In Thunderbird Products Corp v Thunderbird Marine Products Pty Ltd (1974) 131 CLR 592, Jacobs J said at 602:

[R]egistration by another of the trade mark prevents the further use of the mark by the person who had been the first to use it. That is not permissible because it bars the true proprietor of the mark in Australia, the person who had first used the mark to distinguish his goods in the course of trade in this country.

42    In Winton Shire Council v Lomas (2002) 119 FCR 416, Spender J noted at [37], by reference to High Court decisions, that “a very small amount of use will suffice”.

43    The person claiming to be the owner of a trade mark may rely on authorised use of the mark by another person: s 8(2) TMA.

44    There is an onus on the party seeking removal of a trade mark from the Register to disprove the registered owner’s claim of first use: Colorado Group at [8] per Kenny J, [73] per Allsop J, Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9 at [61].

45    Ownership is not established by earlier use of a trade mark unless it is the same as or substantially identical to the trade mark the subject of the application for registration: Colorado Group at [107] – [108] per Allsop J, E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144 at [69]. In Carnival Cruise Lines v Sitmar Cruises Ltd (1994) 120 ALR 495, Gummow J, discussing Shell Co of Australia v Rohm & Haas Co said at 513:

[I]t does not supply any general authority for the proposition that in the case of disputed claims to proprietorship under the present statute anything less than substantial identity between the two marks will suffice. The phrase “substantially identical” as it appears in s 62 (which is concerned with infringement) was discussed by Windeyer J in Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 414. It requires a total impression of similarity to emerge from a comparison between the two marks. In a real sense a claim to proprietorship of the one extends to the other. But to go beyond this is, in my view, not possible. There is, as Mr Shanahan points out in his work, p 158, real difficulty in assessing the broader notion of deceptive similarity in the absence of some notional user in Australia of the prior mark (something postulated by s 33) or prior public recognition built up by user: s 28(a).

In the present case there would, in my view, be no material distinction to be drawn between FUN SHIP and FUNSHIP or between the addition of the definite article or the use of the plural. However, FUN SHIP is for this purpose a substantially different trade mark to SITMAR’S FUNSHIP and FAIRSTAR THE FUNSHIP.

46    The earlier use of the trade mark must also be in relation to the same services or the same kind of services as those in respect of which the trade mark is registered. In Colorado Group, Kenny J at [6] said:

The owner of a mark does not have rights at large in relation to the mark. The effect of the 1995 Act, which, in this regard, is much the same as earlier trade mark legislation, is that a trade mark must be registered in respect of particular goods or services as set out in Sch 1 to the Trade Marks Regulations 1995 (Cth): see regs 3.1 and 4.4 and Sch 1; also the 1995 Act, ss 19 and 27. Ownership by first use is therefore ownership (or proprietorship) in relation to the goods or classes of goods on which the mark has first been used. The owner’s right to registration in this circumstance is not limited to the identical goods or classes of goods but extends to goods or classes of goods “of the same kind”: see Jackson & Company v Napper (1886) 35 Ch D 162 at 178 and Re Hicks’ Trade Mark; Ex parte Metters Bros (1897) 22 VLR 636 at 640.

47    The use must be at a time when there was actual trade, or an offer to trade, in the goods or services bearing the mark, or, at least, an existing intention to offer or supply the goods or services in Australia. In Lomas v Winton Shire Council [2002] FCAFC 413, the Full Court said at [39]:

However, where there is no actual trade or offer to trade in goods bearing the relevant mark in Australia or any existing intention to offer or supply such goods in trade, but merely preliminary discussions and negotiations about whether the mark would be so used, there is no use so as to constitute ownership of the mark (see Moorgate Tobacco (No 2) at 434).

48    The earlier use must be use of the mark as a trade mark: Moorgate Tobacco Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 432 per Deane J, King Par LLC v Brosnan Golf Pty Ltd (2014) 106 IPR 457 at [180] per Greenwood J. As the issue of use as a trade mark is particularly significant to the disposition of the ownership issue in this case, I will set out the relevant principles in some detail.

49    In E & J Gallo Winery v Lion Nathan Australia Pty Ltd, the High Court at [43] approved the following passage from Coca-Cola Co v All-Fect Distributors Ltd (1999) 96 FCR 107 at [19]:

Use ‘as a trade mark’ is use of the mark as a ‘badge of origin’ in the sense that it indicates a connection in the course of trade between goods and the person who applies the mark to the goods … That is the concept embodied in the definition of “trade mark” in s 17 – a sign used to distinguish goods dealt with in the course of trade by a person from goods so dealt with by someone else.

50    In Woolworths Ltd v BP plc (No 2) (2006) 154 FCR 97, the Full Federal Court said at [77]:

Whether or not there has been use as a trade mark involves an understanding from an objective viewpoint of the purpose and nature of the use, considered in its context in the relevant trade. How the mark has been used may not involve a single or clear idea or message. The mark may be used for a number of purposes, or to a number of ends, but there will be use as a trade mark if one aspect of the use is to distinguish the goods or services provided by a person in the course of trade from the goods or services provided by any other persons, that is to say it must distinguish them in the sense of indicating origin.

51    In Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326, Gummow J said at 347-348:

Where the trade mark allegedly used by the defendant comprises ordinary English words … then … that circumstance may be taken into account by the court in the process of reasoning by which it accepts or rejects a submission that the use in question is not a trade mark use but a description of the goods in question. To say that is not to gainsay the point made by Dixon CJ in Mark Foys Ltd v Davies Coop and Co Ltd (the Tub Happy case) (1956) 95 CLR 190 at 194-195 that language is not always used to convey a single, clear idea; a mark may have a descriptive element but still serve as a badge of trade origin. However, where the issue is one of infringing use by use of a word mark (as in the present case), the fundamental question remains, to paraphrase what was said by Williams J in the same case (supra) (at 205), whether those to whom the user is directed are being invited to purchase the goods (or services) of the defendants which are to be distinguished from the goods of other traders “partly because” (emphasis supplied) they are described by the words in question.

52    In Johnson & Johnson, Lockhart J stated at 336:

Distinctive means distinctive in the sense that the mark distinguishes the registered proprietor's goods from others of the same type in that market, though it does not mean that the goods must specifically identify the plaintiff as the source of those goods. Often the identity of the supplier will be unknown, but what is important is that a significant number of consumers in the relevant market identify the plaintiff's goods as coming from one trade source.

53    In Aldi Stores Ltd Partnership v Frito-Lay Trading Co GmbH (2001) 190 ALR 185, Hill J said at [23]:

Where the sign or mark is an invented word or invented combination of words, it will usually be easy to conclude that use on packaging or on the goods themselves is a trade mark use … Where the word has or a combination of words have a clear meaning in ordinary use, the question will be much more difficult as the word or combination of words may either have taken on a secondary meaning indicating the origin of the goods or may simply convey an ordinary meaning (that is, some message other than the trade origin of the goods): see Top Heavy Pty Ltd v Killin (1996) 34 IPR 282 at 286. It is well established that there is not a true dichotomy between words capable of being used as a badge of trade origin and words that are descriptive: see Johnson & Johnson at FCR 347 per Gummow J and at FCR 339 per Lockhart J.

54    The legal principles concerning the use of a sign as a trade mark were succinctly summarised by Reeves J in Mantra Group Pty Ltd v Tailly Pty Ltd (No 2) (2010) 183 FCR 450 at [50]:

(a)    Use as a trade mark is use of the mark as a “badge of origin” in the sense that it indicates a connection in the course of trade between goods or services and the person who applies the mark to those goods or services. It has been described as “planting a flag to identify the fact you are in a particular trader’s territory”;

(b)    In determining whether a sign is used as a trade mark, one does not ask whether the sign indicates a connection between the alleged infringer’s services and those of the registered owner. Instead, one asks whether the alleged infringer has used the sign so as to indicate that the origin of the services was in itself;

(c)    The latter question is the question that has to be determined at this threshold stage. The determination of this threshold question only involves an examination of the impugned mark, not the registered trade mark;

(d)    In assessing whether the alleged use is use as a trade mark, the Court is required to examine the purpose and nature of the use in its context. This includes factors such as the positioning of the sign, the type of font used, the size of the words or letters, and the colours which are used, as well as how the sign is applied to the advertising material in question;

(e)    This assessment of the purpose and nature of the use of the sign is objective, ie by reference to what a member of the public could be expected to understand by its use;

(f)    The words (of a mark) may be used to describe the goods or services concerned, but still serve as a badge of trade origin. The question is whether consumers are being invited to purchase the services on the basis that they are to be distinguished from that of other providers of those services partly because they are described by the words used;

(g)    It has been doubted whether the mere registration of a domain name containing the words of a trade mark constitutes the use of those words as a trade mark for the purposes of s 120 of the Trade Marks Act. However, if the registered domain name is linked to a website that contains advertising material that promotes goods or services in relation to which the trade mark is registered, this combination of use could constitute use as a trade mark under s 120 of the Trade Marks Act. This is all the more so if the advertising material on the website also uses the words of the trade mark to promote the goods or services concerned. In considering whether these situations constitute trade mark use, it will be necessary to apply the general principles set out above to the particular circumstances.

(Citations omitted. Emphasis in original.)

55    In summary, where cancellation of the registration of a trade mark is sought on the ground that the person registered as the owner is not the owner, the party seeking cancellation must prove that he or she or someone else used the trade mark in Australia earlier than the registered owner did. The party seeking cancellation must establish that the earlier use was:

(a)    use of a trade mark identical or substantially identical to the trade mark sought to be registered;

(b)    use as a trade mark;

(c)    use in respect of goods or services of the same kind or class; and

(d)    at a time when there was actual trade, or an offer to trade, in the goods or services bearing the mark, or, at least, an existing intention to offer or supply the goods or services in Australia.

The services in respect of which the trade marks are registered

56    The trade marks are registered in respect of six types of services in each of Class 36 and Class 43. In Class 36 those services are:

(a)    agency services for the leasing of real estate properties;

(b)    commercial real estate agency services;

(c)    apartment letting agency;

(d)    apartment rental services;

(e)    rental of apartments;

(f)    rental of accommodation.

57    In Class 43 the services are:

(a)    accommodation letting agency services (holiday apartments);

(b)    accommodation letting agency services (hotel);

(c)    hotel accommodation services;

(d)    accommodation reservation services;

(e)    booking services for accommodation;

(f)    hotel services.

58    The cross-claimants do not dispute, or only faintly dispute, that CHL was the first user of the trade marks in respect of some of the Class 36 and Class 43 services.

59    Ms Bradnam specifically deposed that the services her business provided and marketed were apartment letting services, but not hotel services. She said:

While I let some apartments in the hotel section (i.e. Harbour Lights Managed Apartments CTS), the actual services that my business provided were strictly apartment letting services; not hotel services. For example, I did not provide onsite baggage storage services, room service, concierge services or other services typically offered by hotel operators. I was aware these services were provided by Mirvac as part of its hotel service. At no time did I ever advertise my business as providing hotel services. The service I provided and marketed was private apartment letting services.

(Emphasis in original.)

60    Ms Bradnam therefore disclaims first use and ownership of the trade marks in respect of “accommodation letting agency services (hotel)”, “hotel accommodation services” and “hotel services” in Class 43. I accept that CHL is the owner of the trade marks in relation to those services.

61    In addition, there is little or no dispute that CHL was the first user of the trade marks in relation to “commercial real estate agency services” in Class 36 by its use of the trade marks in connection with the sale of lots.

62    Ms Bradnam claims ownership by first use of the trade marks in relation to the remainder of the services. There was little evidence and attention directed to what most of those services entail, but it is a question of some importance. It is convenient to set out my assessment of those services at this stage in order to avoid repetition later.

63    I consider that, for the purposes of this case, there is no distinction to be made between “apartment letting agency”, “apartment rental services”, “rental of apartments”, “rental of accommodation” and “accommodation letting agency services (holiday apartments)”. The accommodation in the Harbour Lights complex consisted solely of apartments. Although those in the Managed Scheme were smaller and did not have full kitchen facilities, they were sold as “managed apartments”. The Macquarie Dictionary seems to treat “let” and “rent” as synonyms, defining “let out” as “to grant the occupancy or use of (land, buildings, rooms, space, etc., or moveable property) for rent or hire”, while defining “rent”, relevantly, as “to be leased or let for rent”. While the word “let” may generally refer to shorter term occupancy than “rent”, there can be short-term rentals. No distinction between these categories of services was suggested by the parties.

64    In providing the services described in the preceding paragraph, it is to be expected that a business would advertise the availability of the accommodation and take bookings or reservations from guests. That is certainly what Accor and Liv do. I consider that the provision of the services described above will also involve the provision of “accommodation reservation services” and “booking services for accommodation”. I will refer to these services collectively as “rental and letting services”.

65    I consider that there is some distinction between “agency services for the leasing of real estate properties” and the rental and letting services. The former suggests a formal lease for medium to long-term accommodation. It refers to accommodation leased for a longer period than rental for short-term holidays, business travel and the like.

66    It is convenient to refer to the services other than “commercial real estate agency services” “accommodation letting agency services (hotel)”, “hotel accommodation services” and “hotel services” collectively as “leasing, letting and rental services”.

67    It is also necessary to consider what “accommodation letting agency services (hotel)”, “hotel accommodation services” and “hotel services” involve in order to distinguish those services from the leasing, letting and rental services. Dino Mezzatesta, a senior executive with Accor, expressed the opinion that guests booking a hotel room would expect, unless expressly notified otherwise, the following:

(a)    the ability to check-in and check-out at a reception on-site;

(b)    supply of a furnished room with linen and towels;

(c)    a daily room clean or tidy, with the making of the bed and replacement of towels each day;

(d)    the ability to call someone who is in the hotel on a 24 hour basis, so that if there is an issue or problem, that person would come promptly to the guest room;

(e)    an on-site person monitoring the security and safety of the hotel on a 24 hour basis, for example, in relation to smoke and fire issues, and to monitor the behaviour of other guests;

(f)    the ability to get extra keys, toiletries and towels, if needed, from a person on-site;

(g)    room service, or at least the ability to have breakfast delivered to the room;

(h)    on-site luggage storage;

(i)    the ability to collect mail, packages and messages at the front desk.

68    These are services that Accor provides in its hotel business at the Harbour Lights complex. The quality of the hotel is described as 4½ stars and my impression is that the features that Mr Mezzatesta described are those that a guest would expect at a hotel of that quality.

69    David Catterall, a provider of management services for hotels and resorts who gave expert evidence, indicated that “hotel” does not have a fixed meaning in the industry. He indicated, however, that the characteristics that people commonly use to define a modern hotel include:

(a)    24 hour reception;

(b)    tour desk;

(c)    concierge;

(d)    daily housekeeping service;

(e)    mini-bar;

(f)    room service;

(g)    extra facilities and services.

70    Again, these are services that guests would expect at a high quality hotel. Some hotels are “dives” and would not provide all these services, but they are nevertheless hotels.

71    In my opinion, a hotel is ordinarily understood to be an accommodation facility that provides, at a minimum, an on-site reception desk and the ability to check-in and check-out on-site. The services described as “accommodation letting agency services (hotel)”, “hotel accommodation services” and “hotel services” have corresponding meanings. I add that it may be possible for an accommodation facility that does not have on-site reception and check-in to still be regarded as a hotel if it has some of the other features of a hotel indicated above.

72    It is convenient to refer to “accommodation letting agency services (hotel)”, “hotel accommodation services” and “hotel services” collectively as “the hotel services”.

First use by CHL and Accor

73    I will consider when CHL and Accor first used the trade marks. Then I will consider Ms Bradnam’s claim to have used the trade marks first.

74    The name “Harbour Lights” was created by George Chapman, a director and shareholder of CHL, for the proposed development in December 2003. CHL was originally named Citiport Developments Pty Ltd, but changed its name to Cairns Harbour Lights Pty Ltd on 22 December 2003.

75    Mr Kenneth Chapman, a director of CHL, deposed that:

The intention of CHL was that the Managed Scheme would operate as a hotel. The lots were generally smaller than residential lots and were sold by CHL fully furnished. The Residential Scheme had larger apartments, which were two and three bedroom apartments, and these apartments were designed for owner-occupiers and longer term tenants.

76    CHL sold the caretaking and letting rights for both the Managed Scheme and Residential Scheme to Mirvac (now Accor) on 21 December 2004. Mirvac operated a chain of hotels in Australia known as “Sebel”. Mirvac used the name “The Sebel Harbour Lights” to describe both its letting business and the Harbour Lights complex until early 2009. After that, Mirvac used the name “Cairns Harbour Lights”.

77    A wholly owned subsidiary of CHL started providing a service involving long-term rentals of apartments in the Managed Scheme and the Residential Scheme in late 2008 after obtaining a real estate agent’s licence.

78    The cross-respondents give fifteen “Examples of the early use of the Trade Marks” which are said to demonstrate their use of the trade marks in relation to hotel services, accommodation reservation services, apartment rental services, accommodation letting services and services relating to the rental of accommodation prior to October 2006. The cross-respondents also appear to rely on CHL’s use of its domain names and its website.

CHL’s use of domain names and website

79    On 28 January 2004, the following domain names were registered:

(a)    harbourlights.com.au; and

(b)    cairnsharbourlights.com.

80    Although Skyrail Pty Ltd and “Brightfox” were the registrants, CHL used the domain names to resolve to its website. In other words, when the domain names were typed into a web browser, the viewer was taken to CHL’s website. In early 2004 CHL’s website went “live”. From early 2005, CHL also used the domain name cairnsharbourlights.com.au, but the registration of that domain name lapsed, and the name was subsequently registered by Ms Bradnam. Mr Chapman’s evidence was that the website was “branded as ‘Harbour Lights’ since its first launch”.

81    I will consider whether the use of the domain names to resolve to CHL’s website and the content of the website itself amounts to trade mark use in relation to the Class 36 and Class 43 services.

82    In Mantra Group v Tailly, Reeves J said at [50]:

[I]f the registered domain name is linked to a website that contains advertising material that promotes goods or services in relation to which the trade mark is registered, this combination of use could constitute use as a trade mark under s 120 of the Trade Marks Act.

83    In Edgetec International Pty Ltd v Zippykerb (NSW) Pty Ltd (2012) 98 IPR 1, Reeves J was concerned with a case in which the respondent had registered domain names that incorporated or were similar to the applicant’s registered trade marks and linked those domain names to a website which advertised the respondent’s goods and services. His Honour held at [24]:

I consider this is trade mark use of those signs or words. That is so because this use of a domain name to redirect potential customers to a website displaying one’s goods and services is analogous to using those words as a sign on the front of a shop to indicate the goods and services that are sold within.

84    When deciding whether domain names are substantially identical to the trade marks, the prefix “www” and the suffix “.com” or “.com.au” do not substantially affect the identity of the trade mark: The Architects (Australia) Pty Ltd v Witty Consultants Pty Ltd [2002] QSC 139 at [21] per Chesterman J, Sports Warehouse Inc v Fry Consulting Pty Ltd (2010) 186 FCR 519 at [155] per Kenny J.

85    Mr Chapman deposed that CHL “operated a website to promote sales of apartments”. That is consistent with other aspects of his evidence demonstrating that CHL used the names “Harbour Lights” and “Cairns Harbour Lights” as trade marks in respect of sales of lots in the development from 2004. For example, CHL engaged real estate agents who were provided with business cards that contained the words “Harbour Lights”. The agents each had an email address in the form “name@harbourlights.com.au”.

86    Mr Chapman said later in his affidavit that the website was used by CHL both to sell apartments and to “encourage potential owners to use the services of the onsite letting agent”. He explained under cross-examination that it was in CHL’s interests to encourage apartment owners to use Mirvac’s services.

87    Mr Chapman’s evidence did not explain how the website was used to encourage potential owners to use Mirvac’s letting agency services or indicate the words that were used to do so. His evidence was somewhat evasive through omission in that respect. While Mr Chapman annexed a document showing the current home page of the CHL website, he produced no version demonstrating encouragement of the use of Mirvac’s services. In contrast, Ms Bradnam was able to produce screen shots taken from CHL’s website on 16 July 2007, 19 July 2008 and 11 September 2009. Those screen shots refer only to sales of apartments, not to letting of them. In these circumstances, I do not accept Mr Chapman’s assertion that the website was used to encourage potential owners to use Mirvac’s letting agency services.

88    Even if Mr Chapman’s evidence is accepted, it does not go far enough to support a conclusion that the words “Harbour Lights” were used on the website as a trade mark in relation to Mirvac’s letting agency services. His evidence does not indicate that those words were used as a badge of origin, rather than, for example, merely as descriptive of the complex. I cannot reach such a conclusion from the vague evidence that the website was “branded as ‘Harbour Lights’” and was used to encourage potential owners to use Mirvac’s letting services. The use of CHL’s domain names to resolve to the website, therefore, is not trade mark use in relation to letting services.

89    An additional problem is that there is no evidence of precisely when the website encouraged owners to use Mirvac’s services. Mr Chapman’s oral evidence was merely that it occurred “at different stages” prior to the completion of the building. The problem lies in comparing the timing of CHL’s claim of first use of the trade marks with Ms Bradnam’s claim that her first use was in October 2006.

90    I find that CHL’s website advertised or promoted sales of apartments, but not leasing, rental or letting of apartments or hotel services. The use of the domain names to resolve to CHL’s website was not use in connection with the Class 36 and Class 43 services, other than “commercial real estate agency services”.

91    Some of the documents containing the cross-respondents’ fifteen examples of early use, which I will discuss below, refer to CHL’s domain names. To avoid repetition, I will indicate that my conclusion applies equally to those uses of CHL’s domain names. That is, the use of CHL’s domain names to resolve to its website was not trade mark use in connection with the Class 36 and Class 43 services, other than “commercial real estate agency services”.

Media release 30 June 2004

92    The first of the cross-respondents’ fifteen examples is a media release dated 30 June 2004. It is quite lengthy and I do not propose to set out its contents in full. The cross-respondents submit that the use of the terms “managed apartments”, “guests” and “investors” demonstrates preparatory use in relation to apartment letting agency and accommodation letting agency services.

93    It must be borne in mind that the use must be use as a trade mark and that it is necessary to consider that issue in accordance with the understanding of an ordinary person. To avoid repetition, I will indicate that is the way I will approach my consideration of the issue of use as a trade mark throughout these reasons.

94    The media release was presumably sent to members of the media. There is no reason to suppose that such persons would have a different understanding of the Harbour Lights development and the content of the media release to ordinary members of the public. An ordinary person may be taken to have had no knowledge of the Harbour Lights development prior to reading the media release.

95    The media release aimed to promote sales of apartments in the development. It set out the range of sale prices for “residential apartments” and “managed apartments”. It stated that “Harbour Lights” has “101 residential and 92 managed apartments”. The media release also stated that the “Harbour Lights Display and Sales Office” can be contacted at info@harbourlights.com.au.

96    I accept that the reference to “Harbour Lights Display and Sales Office” was use as a trade mark of a mark substantially identical to “Harbour Lights” in relation to “commercial real estate agency services”, although not in relation to any of the other Class 36 or Class 43 services.

97    The email address info@harbourlights.com.au is substantially identical to “HARBOUR LIGHTS”, ignoring the “.com.au” and “info@”, but it was used as a trade mark only in connection with sales. That is evident from the press release being directed to sales, the absence of any reference to letting services in the press release and the stated use of the email address which was to contact the “Harbour Lights Display and Sales Office”.

98    In my opinion, the references to “managed apartments” were to the sale of apartments in the Managed Scheme. They were not references to any service involving the leasing, rental and letting of apartments or the hotel services.

99    Even if it is assumed that “managed apartments” also referred to management of the apartments, in the sense of managing their leasing, rental or letting, that does not assist the cross-respondents. The words “Harbour Lights” and “Cairns Harbour Lights” were not used as trade marks, whether wholly or in part. The media release used “Cairns Harbour Lights” to describe the name of the 12 story, 193 apartment development. It also used “Harbour Lights” as the name of the development. It said, “Harbour Lights is one of the most exciting property developments in Australia today” and “Harbour Lights is in the best location in Cairns ever”. None of the uses of “Harbour lights” and “Cairns Harbour Lights” were to show a connection between the user of the mark and any leasing, rental and letting services.

100    The cross-respondents rely on the reference to “guests” in the phrase “Harbour Lights is positioned to provide residents and guests alike with unparalleled views” to demonstrate that “Harbour Lights” was preparatory use in relation to apartment and accommodation letting services. The cross-respondents also rely on references to “investor response” and “investors…needing to get in quick”. However, these references would suggest to an ordinary reader no more than that some purchasers may want to lease, rent or let their apartments and that guests would find the apartments attractive. They do not indicate that any leasing, rental or letting service was being offered, let alone that there was a connection between the user of “Harbour Lights” and such a service.

Advertisement in The Financial Review 28 October 2004

101    The cross-respondents rely on an advertisement placed by CHL in The Financial Review on 28 October 2004. The advertisement had the heading “Australia’s best waterfront location now available in Cairns”.

102    The advertisement referred to “managed” and “residential” apartments. Again, the advertisement was for the sale of apartments in the Managed Scheme, not for the letting of apartments. The reference to “investment opportunity” would be understood to mean no more than that buying an apartment was a good investment.

103    Even if the use of “managed apartments” were taken to be a reference to letting services, “Cairns Harbour Lights” was not used as a trade mark because those words would be understood as used only to describe the name of the development. The advertisement stated that “Cairns Harbour Lights is a once in a lifetime investment opportunity”. It also stated that “Cairns Harbour Lights boasts 95 metres of absolute water frontage”. That was not use as a trade mark because it was used as the name of the property, and not used to show a connection between the user of the mark and any letting service.

104    In the advertisement, the words “HARBOUR LIGHTS” appeared below the heading. Immediately above the words “HARBOUR LIGHTS” appeared an image of five gold-coloured stars in a horizontal line and immediately below appeared some words that are indecipherable in the copy of the advertisement in evidence. There are a number of other advertisements in evidence which contain a mark that looks similar. I infer from these other advertisements that the indecipherable words are “A New Star Shines”.

105    The cross-respondents submit that “HARBOUR LIGHTS” was used as a trade mark in its own right. The cross-claimants submit that the words “HARBOUR LIGHTS”, the device and the words “A New Star Shines” were used as a composite trade mark.

106    In E & J Gallo, the registered trade mark consisted of the word BAREFOOT. The High Court considered whether the word “Barefoot” in combination with a device of a drawing of a bare foot was substantially identical. The High Court said at [69]:

The addition of the device to the registered trade mark is not a feature which separately distinguishes the goods or substantially affects the identity of the registered trade mark because consumers are likely to identify the products sold under the registered trade mark with the device by reference to the word BAREFOOT. The device is an illustration of the word. The monopoly given by a registration of the word BAREFOOT alone is wide enough to include the word together with a device which does not substantially affect the identity of the trade mark in the word alone. So much is recognised by the terms of s 7(1), which speak of additions or alterations which “do not substantially affect the identity of the trade mark”. Except for a situation of honest concurrent use, another trader is likely to be precluded from registering the device alone while the registered trade mark remains on the Register. The device is an addition to the registered trade mark that does not substantially affect its identity. Accordingly, the use of the registered trade mark with the device constitutes use of the registered trade mark in accordance with s 7(1).

107    The High Court contrasted the outcome in Colorado Group, saying at [68]:

The registered trade mark in that case was for the word “Colorado”, which, by reason of its geographical significance, was not inherently adapted to distinguish the owner’s goods from the goods of other persons as required by s 41(3) of the Trade Marks Act. As noted by Gyles J, it was difficult to obtain registration of a geographical name as a trade mark under the Trade Marks Act 1955 (Cth) by reason of s 24(1)(d) of that Act. The trade mark for the word “Colorado” had been used in conjunction with a mountain peak device, which reinforced the geographical connotation of the word. Allsop J found that the mark used was a composite mark and that the mountain peak device was not a mere descriptor but a distinguishing feature.

108    In my opinion, the words “HARBOUR LIGHTS” together with the device and the words “A New Star Shines” formed a composite mark. There was a connection between all three parts of the mark because the image of the stars alluded to the word “Lights” in “Harbour Lights” and the words “A New Star Shines” alluded to the device and the word “Lights”. The device and the words “A New Star Shines” were not mere descriptors but were distinguishing features.

109    As a general rule, an owner of a composite mark is not the owner for trade mark purposes of the marks comprising each separate component of it: Re JB Palmer’s Trade Mark (1883) 24 Ch D 504, Richards v Butcher [1891] 2 Ch 522, Colorado Group at [7] per Kenny J. The question is whether the composite mark used is substantially identical to “Harbour Lights” or “Cairns Harbour Lights”.

110    In The Shell Company of Australia Limited v Esso Standard Oil (Australia) Limited (1963) 109 CLR 407 (“Shell Company”), Windeyer J discussed at 414 how it is to be judged whether one mark is substantially identical to another (Windeyer J’s judgment was reversed by the Full Court, but not on this point):

In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.

111    On a side by side comparison, the device and the additional words in the composite mark are so significant that the composite mark cannot be described as substantially identical to HARBOUR LIGHTS or CAIRNS HARBOUR LIGHTS. Mere similarity is not enough.

112    Even if the mark used in the advertisement is considered substantially identical to the registered trade marks, it was not used in relation to any of the Class 36 and Class 43 services, other than “commercial real estate agency services”.

Press release 20 November 2004

113    The cross-respondents rely on a press release issued by CHL which was published in the Weekend Post Realtor. The article was entitled “A New Star Shines”. It referred to “Harbour Lights” a number of times, but always as the name of the development.

114    The article dealt with the sales of lots, not the letting of the apartments. The use of “managed apartments” was a reference to the sale of apartments in the Managed Scheme. It did not use “Harbour Lights” in relation to services other than “commercial real estate agency services”.

115    I consider that “Harbour Lights” is substantially identical to “Cairns Harbour Lights” because “Cairns” is a geographical reference and is not distinctive in its own right. Therefore, this was use of a sign substantially identical to CAIRNS HARBOUR LIGHTS in relation to “commercial real estate agency services”. It was not used in relation to the leasing, rental and letting services and hotel services.

116    “Harbour Lights” was not used as a trade mark as it did not indicate a connection between the user and any services.

Advertisement 16 April 2005

117    On 16 April 2005, CHL placed an advertisement in The Sydney Morning Herald. It stated:

Harbour Lights is situated right on the waterfront in the heart of Cairns, close to everything this beautiful region has to offer. Boasting stunning views of the Coral Sea, rainforest-clad mountains and the city of Cairns, it’s no wonder this luxurious development is selling fast. Reside or invest, Harbour Lights is the opportunity of a lifetime.

Purchasing here guarantees absolute waterfront living with comfort second to none. Invest here and you have secured your piece of a tropical paradise that attracts 2.3 million visitors per annum, with management services provided by one of Australia’s leading operations, Mirvac Hotels and Resorts. But above all, be quick!

118    There is no evidence as to the meaning of “management services”. However, I accept that in the context the expression would be understood by an ordinary reader to refer to the service to be provided by Mirvac of managing the rental and letting of the apartments on behalf of owners. In respect of those services, the advertisement did not distinguish between apartments in the Residential Scheme and those in the Managed Scheme, and so covered both. In my opinion, each of the Class 36 and Class 43 services, other than “commercial real estate agency services” and “agency services for the leasing of real estate properties”, was encompassed within the term “management services”.

119    The issue is whether “Harbour Lights” was used as a trade mark in relation to the management services to be provided by Mirvac. The words “Harbour Lights” were used as the name of the development in which apartments are offered for sale and were also used in CHL’s domain name which resolved to its website promoting such sales. However, “Harbour Lights” was not used as a badge of origin in relation to the management services. The advertisement did not suggest, for example, that management services would be provided “by Harbour Lights”; but only that such services would be provided by Mirvac for the owners of the apartments in Harbour Lights. The advertisement did not indicate a connection between the user of the mark and rental and letting services or hotel services.

120    The advertisement also used the composite mark consisting of the words “Harbour Lights” and “A New Star Shines” and the image of five stars, but, for the reasons already given, it was not substantially identical to either of the registered trade marks in dispute.

Brochure May 2005

121    The cross-respondents next rely on a brochure described as a “Hotel Fact Sheet” created by Mirvac in May 2005 entitled “Splendour by the sea…the facts”. The brochure referred to “The Sebel Harbour Lights”, but did not use the words “Harbour Lights” by themselves. It set out features of the development including its location, accommodation, guest services and nearby attractions. By the use of headings such as “Guestroom layouts”, “Guest services” and “Guestroom features and facilities”, the brochure promoted the rental and letting services and hotel services offered by Mirvac.

122    I accept that “The Sebel Harbour Lights” was used as a trade mark in relation to the Class 36 and Class 43 services other than “commercial real estate agency services” and “agency services for the leasing of real estate properties”.

123    The cross-claimants submit that the trade mark used by Mirvac was “The Sebel Harbour Lights”. The cross-respondents submit that they used “The Sebel” and “Harbour Lights” as separate trade marks. The cross-respondents advance their submission by reference to the evidence of Mr Mezzatesta, who deposed that:

[T]he Cairns Harbour Lights hotel was initially branded using two brands, namely “Sebel” and “Harbour Lights”. Thus, on opening, it had a dual brand of “Sebel Harbour Lights”.

…

This dual branding strategy changed in 2009 for the Sebel Harbour Lights property and Accor thereafter branded it as “Cairns Harbour Lights”.

124    The cross-respondents submit that there are a number of factors that support the conclusion that “Harbour Lights” was used as a trade mark separately from “The Sebel”. They note that “Sebel” is a registered trade mark in its own right as, of course, is “Harbour Lights”. They point out that the initial advertising by CHL was for “Harbour Lights” and “Cairns Harbour Lights”, without “The Sebel”. In some advertising, “The Sebel” was used on a different line to “Harbour Lights”. The Sebel is a well known hotel chain with its own history and reputation, and was promoted separately in relation to other properties. The “Harbour Lights” sub-brand focussed on a specific market segment, namely, consumers looking for accommodation near Cairns Harbour, and thus had its own attributes over and above that of the Sebel brand. The Sebel brand was owned by a different entity to the “Harbour Lights” brand. It would have been irrational for Mirvac to remove “The Sebel” from the branding of the hotel in 2009 if “Harbour Lights” was not a trade mark in its own right (although I note that from 2009 the property was branded as “Cairns Harbour Lights”). The cross-respondents submit that “Harbour Lights” functions as a trade mark independently of the “Sebel” trade mark and, thus, use of “The Sebel Harbour Lights” is evidence of use of both “The Sebel” and “Harbour Lights”.

125    I accept that “The Sebel Harbour Lights” consists of two brands which are each registered trade marks. I accept that the use of two brands together to market a hotel is common. I accept that there were sound marketing reasons for Accor promoting its services by the use of “The Sebel Harbour Lights”, which reflected the reputation or attributes of each brand. However, the focus of the cross-respondents on brands tends to distract from the real issue, which is whether “Harbour Lights” was used as a trade mark in the brochure: cf Unilever Aust Ltd v Karounos (2001) 113 FCR 322 at [53] per Hill J.

126    The cross-respondents’ submissions invite attention to Mirvac’s intention and purpose in using “The Sebel Harbour Lights”. The effect of Mr Mezzatesta’s evidence is that Mirvac considered that it was using “The Sebel” and “Harbour Lights” as separate trade marks. The cross-respondents’ submissions suggest that the test must be a subjective one or involve subjective elements. They do not point to any authorities supporting that approach.

127    The question under consideration is whether Accor used “Harbour Lights” as a trade mark in the brochure. That involves an objective test. The issue of precisely what words or combination of words were used as a trade mark is a slightly different question, but there is support for the proposition that this also involves an objective test.

128    In Richards v Butcher, Kay J at first instance said at 536-537:

Now, how can I possibly say that the purchaser of a bottle with this wrapper on it, “Monopole, Heidsieck & Co, Reims,” would know that “Monopole” was the trade-mark and “Heidsieck & Co., Reims,” was not? How can I say that? I should not know myself. If I were asked I should suppose that “Monopole” was a description of a special wine made by these gentlemen, and that “Monopole” was never intended to be a trade-mark; and I should be strongly fortified in that view by knowing, as I do know now, that on some other wines they put, not “Monopole,” but “Dry Monopole.” Surely that meant some particular character of wine. Then on some others they put, “Grand Vin Royal” and “Sillery Mousseux.” Therefore, it is clear enough that a purchaser buying a bottle of wine with that wrapper upon it would not know from that wrapper that “Monopole” was alone used there as the trade-mark. That is conclusive, because it is what the purchaser would know - not what the seller meant in his own mind – it is what the purchaser would know and judge was used as the trade-mark which must establish the user as a trade-mark of the word “Monopole” only.

129    The Court of Appeal dismissed an appeal from the judgment of Kay J and their Lordships’ judgments are consistent with the test being an objective one. The judgment of Kay J was cited with approval by Lord MacMillan in Bass, Ratcliff and Gretton Limited v Nicholson and Sons Limited [1932] AC 130 at 156.

130    As the brochure was created in May 2005, some two years prior to the completion of the building, it is likely to have been directed to persons who had contracted to buy a lot or were considering doing so, and it is necessary to consider how the words would be understood by an ordinary member of that class. In my opinion, such a person would understand “The Sebel Harbour Lights” to be used as a single sign. The natural reading of those words is as a single phrase. Each of the words commenced with a capital letter, which grouped the words together and distinguished them from the surrounding words. Such a person would not view “The Sebel” as one sign and “Harbour Lights” as a separate one. The whole of the words appeared to be used together, and there was nothing to indicate that they were to be considered separately. While Mr Mezzatesta’s evidence may have some relevance to how an ordinary person would understand the use of the words, that evidence is not persuasive. In my opinion, Accor must be taken to have used “The Sebel Harbour Lights” as a trade mark, not “Harbour Lights”.

131    The next question is whether “The Sebel Harbour Lights” is substantially identical to “Harbour Lights” and “Cairns Harbour Lights”. For marks to be substantially identical there must be a total impression of similarity emerging on a comparison of the two marks (see [110]).

132    In my opinion, “The Sebel Harbour Lights” is a substantially different mark to “Harbour Lights” and “Cairns Harbour Lights”. The words “The Sebel” are distinctive and not merely descriptive. I am assisted in this conclusion by the analysis of Gummow J in Carnival Cruise Lines at 513.

Magazine Article 29 June 2005

133    The next publication relied upon by the cross-respondents is an article appearing in Traveltrade entitled “Cairns limelight for Mirvac”. The article referred to “the Sebel Harbour Lights”. Again, I consider that an ordinary reader would understand this mark to be used as a single mark. It is substantially different to “Harbour Lights” and “Cairns Harbour Lights”.

Advertisement October 2005

134    Mirvac caused an advertisement for “Sebel Harbour Lights Cairns” to be published in a brochure entitled Sunlover Far North Queensland printed in October 2005. Again, the mark used would be understood as a single mark, and it is not substantially identical to the registered trade marks.

Press release December 2005

135    There are the same difficulties with a press-release issued by Mirvac in December 2005 which referred to “The Sebel Harbour Lights” and “The Sebel Harbour Lights Cairns”.

Article 17 December 2005

136    An article was published in the Cairns Weekend Post Realtor entitled “lighting up cairns” on 17 December 2005. It appears that CHL paid for the article to be published.

137    The article said, relevantly:

With 95 m of absolute water frontage, Harbour Lights allows the chance to turn that vision into reality.

…

Nestled on the Cairns foreshore between the Hilton Hotel and Reef Fleet Terminal, Harbour Lights Apartments provide spectacular views of the Coral Sea, Cairns marina, Esplanade Lagoon, inner city Cairns and the surrounding rainforest clad mountains.

…

The property is divided into 101 residential and 92 managed apartments. The managed operator is Mirvac Hotels and Resort, which will operate Sebel Harbour Lights to cater to the tastes of the most discerning guest.

…

In early 2006, an on-site display apartment will open allowing you to imagine life at Harbour Lights for yourself or how good an investment it will be.

138    I accept that by the use of the term “managed operator” and the words that follow, “Sebel Harbour Lights” was used as a trade mark in relation to rental and letting services and hotel services. The difficulty is that “Sebel Harbour Lights” was used as a single mark and is not substantially identical to “Harbour Lights”.

139    The references in the article to “Harbour Lights” are to the name of the development and do not amount to use as a trade mark.

Advertisement 17 December 2005

140    The cross-respondents rely on an advertisement in Weekend Post Realtor on 17 December 2005. It had the heading “Three year fixed rent lease option now available”.

141    The advertisement contained the composite mark consisting of the words “Harbour Lights” with the device consisting of five stars and the words “A New Star Shines”.

142    The advertisement stated “The Sebel Harbour Lights Cairns is the star performer in luxurious waterfront managed apartment investments”. That statement was followed by other statements including “3 Year Fixed Rent Leaseback Option now available”.

143    I accept that the advertisement referred to both the sale of lots and to the leasing of lots back to either the developer or “The Sebel Harbour Lights Cairns”. An ordinary reader would infer that the apartments would then be leased, rented or let to members of the public. The mark “The Sebel Harbour Lights Cairns” was used as a trade mark in relation to each of the Class 36 and Class 43 services.

144    The next question is whether either of the marks used in the advertisement is substantially identical to “Harbour Lights” and “Cairns Harbour Lights”. They are not substantially identical for the reasons I have already given (see [111] and [130]).

Advertisement spring 2006

145    The next publication relied on by the cross-respondents is an advertisement in The Financial Review published in the spring of 2006. That advertisement was similar to the one published on 17 December 2005, except that the heading is “Only the best address in Cairns offers these absolute waterfront views!”

146    The advertisement contained the words “HARBOUR LIGHTS” with five stars depicted above it. Below it appear words which are indecipherable on the copy in evidence but which I infer are “A New Star Shines”. I again consider that the mark is a composite mark and is not substantially identical to “Harbour Lights” and “Cairns Harbour Lights”.

147    There is again the difficulty that “The Sebel Harbour Lights Cairns” is used as a single mark and is not substantially identical to the registered trade marks.

148    The advertisement contained the words “Developed by Cairns Harbour Lights Pty Ltd”, but those words are not relied on by the cross-respondents.

Brochure late 2006

149    The cross-respondents point to a brochure which they say was printed in late 2006 by CHL. There is no evidence of the precise date.

150    The brochure used the composite mark “HARBOUR LIGHTS” with the image of the stars above and the words “A New Star Shines” below. It is not substantially identical to the registered trade marks.

151    The brochure stated:

Harbour Lights is situated right on the waterfront in the heart of Cairns…it’s no wonder this luxurious development is selling fast.

Purchase an apartment here and you’ll enjoy comfort second to none. Invest here and you’ll benefit from what only the most unique development can offer with management services provided by one of one of Australia’s leading operators, Mirvac Hotels and Resorts.

152    The reference to management services, I accept, involves the service of renting or letting apartments and hotel services. However, “Harbour Lights” was used to describe only the name of the development and not to indicate a connection between the user and the rental and letting or hotel services. It was not used, even in part, as a badge of origin.

Fact sheet late 2006

153    There is a fact sheet entitled “Splendour by the sea…the facts Opening June 2007” said to have been printed in late 2006 by Mirvac. It referred to “The Sebel Harbour Lights”. This, again, was used as a single mark and lacks substantial identity with the registered trade marks.

Brochure late 2006

154    In late 2006 a listing for “The Sebel Harbour Lights” was published in an Abbey Travel brochure. Again, the mark used was a single trade mark and is not substantially identical to the registered trade marks.

Brochure June 2007

155    There is a brochure said to have been printed prior to June 2007 which referred to “Cairns Harbour Lights”. The brochure was only for the sale of apartments. In addition, that name was used only as the name of the development and was not trade mark use.

Information given to potential purchasers

156    Mr Chapman deposed that:

From approximately December 2004, prior to a potential purchaser signing a contract of sale, the potential purchaser was informed that Mirvac was to be the caretaker and exclusive on-site letting agent. The potential purchaser was routinely told this in the sales process, before a contract of sale was prepared, because CHL considered it to be advantageous that a high quality operator such as Mirvac was the on-site manager. The contract of sale included a disclosure statement and, for the Managed Scheme or investors buying in the Residential Scheme, also a PDS (product disclosure statement) that had this information.

157    The applicants submit that:

In addition, from December 2004, CHL used “Harbour Lights” as a trade mark in relation to agency services for the leasing of real estate when it was selling apartments in the hotel to potential purchasers and, upon settlement, assisting some of those purchasers find tenants for their apartments. Prior to any off-the-plan sale, the potential purchasers would be advised that Mirvac (now Accor) was the on-site letting agent. This was to encourage the purchaser to put the apartment in the letting pool to be managed by Mirvac (now Accor). The contract of sale included a disclosure statement and PDS which disclosed this fact and a copy of the by-laws of the schemes.

(Emphasis in original.)

158    Mr Chapman’s evidence indicates that potential purchasers were told that Mirvac would be operating as an on-site letting agent. It does not indicate that potential purchasers were told that Mirvac would be offering its services using the name “Harbour Lights” or “Cairns Harbour Lights”, or that it would otherwise be using either name as a badge of origin. I also note that the PDS itself was not a part of the evidence before the Court.

159    I do not accept that CHL used “Harbour Lights” or “Cairns Harbour Lights” as a trade mark in relation to “agency services for the leasing of real estate”, or any other services, in the way contended for when it was selling apartments and assisting purchasers to find tenants.

CHL’s use of business name

160    Mr Chapman deposed that “CHL (or its related entities) has used the Trade Marks in the following Queensland registered Business Names, with permission from CHL”. One of the business names he then set out is “Cairns Harbour Lights Management”. That business name was registered on 25 May 2005.

161    I did not understand the cross-respondents to submit that the use of “Cairns Harbour Lights Management” established ownership of the trade marks. That may be because there was no evidence of when it was used and in relation to what services and whether it was used as a trade mark.

CHL’s real estate agency services

162    Mr Chapman deposed that CHL has been operating a licenced permanent letting and sales agency through its wholly owned subsidiary Cairns Harbour Lights Management Company Pty Ltd (“CHLMC”) since 2008. He deposed that “CHLMC has provided real estate services, both sales and long term letting, under the Trade Marks”. I infer that this is intended to mean that CHLMC has used the trade marks as trade marks in respect of its real estate services. CHLMC was not incorporated until 27 November 2008, so could not have offered any services until then.

163    I accept that CHL has authorised CHLMC to use the registered trade marks in respect of “commercial real estate agency services” and “agency services for the leasing of real estate properties”. I am required to use an objective test to decide whether the trade marks were used as trade marks since late 2008. In the absence of evidence as to how the trade marks were used, I cannot conclude that they were used as trade marks.

164    The cross-respondents did not rely on any other use of “Harbour Lights” and “Cairns Harbour Lights” between 2007 and 21 January 2009, when HARBOUR LIGHTS was registered as a trade mark. Accor certainly continued to use “The Sebel Harbour Lights” to promote its management services during that time, but, as I have said, that it not substantially identical to “HARBOUR LIGHTS” or “CAIRNS HARBOUR LIGHTS”.

165    In summary, CHL used “Harbour Lights” and “Cairns Harbour Lights” as trade marks in relation to “commercial real estate agency services” prior to 21 January 2009. It did not use the trade marks as trade marks in respect of any of the other Class 36 and Class 43 services prior to that date.

First use by Ms Bradnam

166    I will next consider when Ms Bradnam first used “Harbour Lights” and “Cairns Harbour Lights” as trade marks in respect of any of the Class 36 and Class 43 services.

167    Ms Bradnam purchased a lot in the Managed Scheme on 5 April 2005. Her then partner bought two apartments in the Residential Scheme at about the same time. After her partner told her that he thought that Mirvac’s fees for management were too expensive, Ms Bradnam decided to start a letting business in respect of apartments at the Harbour Lights complex.

168    In early October 2006, Ms Bradnam undertook searches to see what domain names were available and discovered that cairnsharbourlights.com.au and harbourlightscairns.com.au were available. She registered those domain names on 4 October 2006. She later registered harbourlightscairns.com on 17 January 2007.

169    In early October 2006, Ms Bradnam engaged a website designer to design and build a website for her business. On 31 October 2006, she caused her website to “go live” and began advertising her apartment and those of her partner to the public in preparation for the commencement of her new business. Each of her domain names resolved to her website.

170    On 7 March 2007, Ms Bradnam registered the business name “Harbour Lights Property Management and Sales”.

171    On 29 June 2007, settlement of the purchase of her apartment and her partner’s two apartments was completed. Ms Bradnam’s business then commenced trading. Initially this consisted of holiday letting for her apartment and her partner’s apartments. Later she provided a service involving both holiday letting and long-term letting to other lot owners. She made one sale while she operated the business. She traded under the name “Harbour Lights Property Management and Sales”.

172    Ms Bradnam operated her business from her apartment in the Managed Scheme until 1 November 2008, when she moved her business following a complaint by the body corporate. By 2009 she was managing approximately 30 apartments in the Managed Scheme and the Residential Scheme.

173    As CHL and Accor did not use the marks “Harbour Lights” and “Cairns Harbour Lights” as trade marks in relation to any of the Class 36 and Class 43 services other than “commercial real estate agency services” prior to 21 January 2009, the issue is whether Ms Bradnam did so at an earlier time. She does not claim to have used the trade marks in relation to hotel services. The question is whether Ms Bradnam used the trade marks as trade marks in relation to leasing, letting and rental services prior to CHL and Accor.

174    Ms Bradnam’s claim of first use of the trade marks in relation to the leasing, letting and rental services is based upon use on her website, her use of domain names and her use of a business name.

Ms Bradnam’s website from 31 October 2006

175    The home page of Ms Bradnam’s website which “went live” on 31 October 2006 had an aerial photograph of the Great Barrier Reef at the top of the page. Underneath the photograph was the heading “hlp Harbour Lights Private Apartments”. The letters “hlp” were in larger font than the words that followed.

176    Underneath the heading were various tabs, which were apparently able to be clicked-on to bring up other pages on the website. Those other pages are not in evidence.

177    The following words then appeared on the home page:

Cairns Luxury Accommodation

Take a stroll through luxury

Cairns most luxurious and absolute waterfront 5 star holiday apartments, Harbour Lights Private, are about to be released.

Located on the most sought after blue ribbon real estate, these architecturally designed apartments offer the most discerning traveller the ultimate in exclusive, private, premier accommodation.

Each apartment boast the utmost in privacy, tranquillity and all showcase the breathtaking beauty of the Coral Sea, hinterland, and harbour lights.

The apartments offer a quality unsurpassed in the prestigious private holiday market.

The spacious apartments provide every item you need for your getaway, from flat screen televisions, to soft and indulgent linen. If you do dare leave, you can take a dip in the swimming pool, have a glass of wine in the private bar, and all the while, gaze over the horizon to the Great Barrier Reef.

While nestled inside the exclusive CityPort marina it is hard to believe how close you are to the bustling city centre, but boutique shopping, fine cuisine, and entertainment are a mere one minute stroll along the beautifully night lit and adjoining jetty.

178    The positioning of “hlp” was such that it would be naturally read in combination with “Harbour Lights Private Apartments”, rather than separately from those words. The letters “hlp” were distinctive, including because of their size, and were not a mere descriptor attached to “Harbour Lights”. In my opinion, the mark “hlp Harbour Lights Private Apartments” is not substantially identical to “Harbour Lights” or “Cairns Harbour Lights”.

179    Later the webpage referred to “Harbour Lights Private”. In their context, those words would appear to a reader to be a reference to the name of the apartments. Those words were not used as a badge of origin in respect of rental or letting services.

180    The website also referred to “harbour lights” to describe the view available from the apartments. Those words were not used as a trade mark.

181    There are a number of later versions of the home page of Ms Bradnam’s website in evidence. The versions presently relevant are those before 21 January 2009, when “Harbour Lights” was registered, and before 21 April 2009 when “Cairns Harbour Lights” was registered. There are versions of the home page in evidence at the following dates:

(a)    18 December 2006;

(b)    1 April 2007;

(c)    9 May 2007;

(d)    9 August 2007;

(e)    30 August 2007;

(f)    12 October 2007;

(g)    12 November 2007;

(h)    12 December 2007;

(i)    12 February 2008;

(j)    16 March 2008;

(k)    20 March 2008;

(l)    11 May 2008;

(m)    12 June 2008;

(n)    18 July 2008;

(o)    11 December 2008;

(p)    12 December 2008;

(q)    21 December 2008;

(r)    20 February 2009;

(s)    21 February 2009;

(t)    6 March 2009;

(u)    13 April 2009;

(v)    16 April 2009.

182    After 18 December 2006, the heading of the home page was changed to “hlp harbour lights luxury apartments” and the subheading to “Cairns Luxury Accommodation – Holiday Apartments With Class”. A box was added to the side of the text with a photograph of the complex and text that read “luxury harbour side living from $240 per night”. That price later changed to “$99 per night”. After 1 April 2007, the words “about to be released” were changed to “have recently been released”. After 12 February 2008, a section was added to allow viewers to type in the type of apartment sought, the arrival date and the number of nights sought. None of these changes affect my conclusion.

183    By 13 April 2009, the heading had been changed to “harbour lights cairns – the luxury collection”. In my opinion, the new heading would naturally be read as a whole. The words “the luxury collection” were allusive, rather than merely descriptive. I consider that “harbour lights cairns – the luxury collection” is not substantially identical to the registered trade marks HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS.

184    My conclusion is that Ms Bradnam did not use any mark substantially identical to HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS as a trade mark on her website prior to 21 January 2009 or 21 April 2009.

Ms Bradnam’s use of domain names

185    The three domain names registered by Ms Bradnam were:

(a)    cairnsharbourlights.com.au;

(b)    harbourlightscairns.com.au; and

(c)    harbourlightscairns.com.

186    Ms Bradnam used each of those domain names to resolve to her website. It is necessary to examine whether such use of the domain names amounted to use as trade marks and whether the domain names were substantially identical to the registered trade marks and used in connection with the Class 36 and Class 43 services.

187    As Reeves J said in Mantra Group v Tailly at [50], if the domain name is linked to a website that contains advertising material that promotes goods or services in relation to which the trade mark is registered, this combination could constitute use as a trade mark. In Edgetech International, Reeves J said that use of a domain name to direct potential customers to a website displaying a person’s goods and services is analogous to using those words as a sign on the front of a shop to indicate the goods and services that are sold within. In the present case, I consider that Ms Bradnam’s use of the domain names to direct potential customers to her website which advertised her services was use of the domain names as a trade mark. It was use of the domain names as a badge of origin to indicate a connection between her business and the services it provided.

188    It is apparent from the home page (despite the absence of the other pages of the website) that Ms Bradnam’s website advertised apartments for short-term rental and letting. The letting advertised was holiday letting. The home page refers to “the most discerning traveller” and “your getaway”. The services advertised are all the Class 36 and Class 43 services other than “commercial real estate agency services”, “agency services for the leasing of real estate properties” and the hotel services.

189    When Ms Bradnam started operating the website on 31 October 2006 she had an existing intention to offer the services she advertised. From about July 2007, when the complex had been built, she engaged in actual trade on the website.

190    In considering whether the domain names are substantially identical to HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS, the prefixes “www” and suffixes “.com” and “.com.au” should be disregarded. The domain names are each substantially identical to HARBOUR LIGHTS because the word “Cairns” is merely a geographical reference, not distinctive in its own right. One of the domain names is identical to CAIRNS HARBOUR LIGHTS when shorn of the prefix and suffix. The rearrangement of the words in the other two domain names to “harbourlightscairns” does not substantially affect their identity. Therefore, I consider that by the use of the domain names to resolve to her website, Ms Bradnam used trade marks substantially identical to HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS.

191    The use of the domain names by Ms Bradnam was use as trade marks. She used the domain names in respect of each of the Class 36 and Class 43 services other than “commercial real estate agency services”, “agency services for the leasing of real estate properties” and the hotel services. They were so used from 31 October 2006, but even if this is wrong, by no later than July 2007.

Ms Bradnam’s use of business name

192    Ms Bradnam traded under the business name “Harbour Lights Property Management and Sales”. She deposed, referring to her domain names and business names, that “The reason I used the words ‘Harbour Lights’ in these names was simply common sense so guests knew the apartments were located in Harbour Lights CTS and Harbour Lights Managed Apartments CTS”. However, whether the words were used as a trade mark must be determined objectively.

193    Ms Bradnam’s evidence was that she used “Harbour Lights Property Management and Sales” to trade in some general but unspecified ways. She also deposed to some specific uses of that business name. For example, she entered into agreements for the letting of apartments under the business name.

194    I will first consider whether any finding can be made that general and unspecified use of the business name by Ms Bradnam amounts to use as a trade mark of a substantially identical name in relation to any of the Class 36 and Class 43 services. The cross-claimants’ submissions rely on such general use, contending that she was the first user of the trade marks because “From 7 March 2007 until early 2009 Bradnam traded under the business name ‘Harbour Lights Property Management and Sales’”.

195    Section 5(1) of the Business Names Act 1962 (Qld) (now repealed) prohibited the carrying on of a business in Queensland under a business name unless either the business name consisted of the name of the person operating the business, or the business name was registered. Ms Bradnam’s registration of her business name allowed her to carry on business under that name.

196    When a person carries on a business using a business name, a purpose of that use must be to distinguish that person’s business from other businesses. That will often be done in order to distinguish the goods or services provided by the person’s business from those provided by another business, but that will not necessarily be the case. For example, the business name may appear on brochures and other material promoting the businesses’ goods or services; or letters may be written to employees, to regulatory authorities and the like that identify the business, but do not refer to or concern the goods or services of the business.

197    I consider that Ms Bradnam’s evidence of use of the registered business name in a general way, without specifying the uses, does not establish that the business name was used to distinguish the services provided by her business from those provided by other businesses. She may have merely used the business name to identify her business. I find that the cross-claimants have not proved that such general use was trade mark use.

198    There is, however, evidence of more specific use of the business name “Harbour Lights Property Management and Sales” by Ms Bradnam prior to 21 January 2009.

199    Ms Bradnam annexed six examples of agreements with owners of apartments in the Harbour Lights complex to her affidavits. Each of those agreements was between a named owner and “Harbour Lights Property Management & Sales”. Only the first page of five of the agreements is provided, so that the dates of those agreements are not apparent. The sixth, however, is dated 10 August 2007. That agreement states that the client appoints the agent to perform the services of “Letting/leasing of property” and “Collection of rent”. The agreement sets out rental charges for permanent rental and holiday rental.

200    I accept that the agreement of 10 August 2007 demonstrates use by Ms Bradnam of the name “Harbour Lights Property Management and Sales” in relation to each of the Class 36 and Class 43 services other than “commercial real estate agency services” and the hotel services.

201    The business name was used as a badge of origin to indicate a connection between Ms Bradman’s business and the services it provided. It distinguished the services provided by that business from services provided by others. It was use of the business name as a trade mark.

202    It is necessary to consider whether the business name “Harbour Lights Property Management and Sales” is substantially identical to HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS. In my opinion, the words “Property Management and Sales” are purely descriptive of the services offered by “Harbour Lights”. Those words are not distinctive in their own right. Therefore, “Harbour Lights Property Management and Sales” is substantially identical to HARBOUR LIGHTS. That business name is not, however, substantially identical to CAIRNS HARBOUR LIGHTS. Even though Cairns is a geographical name which is not distinctive in its own right, “Harbour Lights Property Management and Sales” and CAIRNS HARBOUR LIGHTS when compared side by side are too dissimilar to be substantially identical.

203    I find that Ms Bradnam used a trade mark substantially identical to HARBOUR LIGHTS as a trade mark in relation to the Class 36 and Class 43 services other than the hotel services in the agreement dated 10 August 2007.

Harbour Lights Caravan Park

204    The cross-claimants relied upon a search showing that the name “Harbour Lights Caravan Park” had been registered as a business name in 1994. They alleged that this was the first use of the “Harbour Lights” trade mark. However, the evidence does not establish the use of “Harbour Lights Caravan Park” as a trade mark, nor when it was first used, nor in relation to which services.

Summary of findings as to ownership of trade marks

205    CHL applied for the registration of HARBOUR LIGHTS on 21 January 2009 and CAIRNS HARBOUR LIGHTS on 21 April 2008 and obtained registration of those marks in respect of a number of specified services in Class 36 and Class 43. I have found that prior to 21 January 2009, neither CHL nor Accor had used those marks or any substantially identical mark as trade marks in respect of such services other than “commercial real estate agency services” (see [165]). CHL is the owner of the trade mark HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS in respect of “commercial real estate agency services”. CHL is also the owner of both trade marks in relation to the hotel services by reason of the registration of those trade marks in circumstances where there was no prior use in relation to those services (see [59] and [60]).

206    I have found that Ms Bradnam did use trade marks substantially identical to HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS as trade marks from 31 October 2006 as domain names linked with her website (see [187]-[191]) and a mark substantially identical to HARBOUR LIGHTS on 10 August 2007 in an agreement with an owner (see [200]-[203]). Ms Bradnam was the first user of the trade marks in respect of the leasing, letting and rental services. It follows that CHL is not the owner of the trade marks in respect of those services.

207    It is not strictly necessary for me to determine whether Ms Bradnam retains ownership of the trade marks. Under s 58 of the TMA, the ground of opposition to registration requires only that CHL is not the owner. However, as the issue of current ownership will become relevant later, I will consider it now. At common law, anyone claiming under a valid assignment from the original owner is the proprietor of the trade mark: Marcus v Sabra International Pty Ltd (1995) 30 IPR 261 at 266, per Burchett J. There was a written contract between Ms Bradnam and Liv for the sale of Ms Bradnam’s business. That contract incorporated the REIQ’s Standard Conditions of Sale – Business Sale. Clause 3.1 shows that the sale includes the intellectual property of the business. Liv is not one of the cross-claimants, but is presently the owner of the trade marks at common law.

Section 41 TMA – Whether the trade marks are capable of distinguishing the services

208    The cross-claimants’ next argument is that the trade marks should be removed from the Register because they are not capable of distinguishing the cross-respondents’ services. At the time each of the applications for registration was made, s 41 of the TMA provided:

41    Trade mark not distinguishing applicant’s goods or services

(1)    For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

(2)    An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (“designated goods or services”) from the goods or services of other persons.

(3)    In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

(4)    Then, if the Registrar is still unable to decide the question, the following provisions apply.

(5)    If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

(a)    the Registrar is to consider whether, because of the combined effect of the following:

(i)    the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

(ii)    the use, or intended use, of the trade mark by the applicant;

(iii)    any other circumstances;

the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

(b)    if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and

(c)    if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.

(6)    If the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:

(a)    if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant—the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;

(b)    in any other case—the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.

209    In Chocolaterie Guylian NV v Registrar of Trade Marks (2009) 180 FCR 60 at [93], Sundberg J described the steps that the Registrar must take under s 41 in order to decide whether to allow the registration of a trade mark. I respectfully adopt his Honour’s analysis, without setting it out here.

Section 41(3) – Extent to which the trade marks are inherently adapted to distinguish

210    In Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511, Kitto J said at 513-514:

That ultimate question must not be misunderstood. It is not whether the mark will be adapted to distinguish the registered owner's goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others. In Registrar of Trade Marks v. W. & G. Du Cros Ltd. [1913] A.C. 624, at pp. 634, 635 Lord Parker of Waddington, having remarked upon the difficulty of finding the right criterion by which to determine whether a proposed mark is or is not “ adapted to distinguish ” the applicant's goods, defined the crucial question practically as I have stated it, and added two sentences which have often been quoted but to which it is well to return for an understanding of the problem in a case such as the present. His Lordship said: “The applicant's chance of success in this respect [i.e. in distinguishing his goods by means of the mark, apart from the effects of registration] must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connexion with their own goods. It is apparent from the history of trade marks in this country that both the Legislature and the Courts have always shown a natural disinclination to allow any person to obtain by registration under the Trade Marks Acts a monopoly in what others may legitimately desire to use.” The interests of strangers and of the public are thus bound up with the whole question, as Hamilton L.J. pointed out in the case of R. J. Lea, Ltd. [1913] 1 Ch. 446, at p. 463; but to say this is not to treat the question as depending upon some vague notion of public policy: it is to insist that the question whether a mark is adapted to distinguish be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.

211    In Cantarella Bros Pty Ltd v Modena Trading Pty Ltd (2014) 315 ALR 4, French CJ, Hayne, Crennan and Kiefel JJ explained Kitto J’s judgment at [57]:

In Clark Equipment, Kitto J considered for the purposes of registration in Pt B the word “Michigan”, which had acquired distinctiveness through 20 years of use in respect of the applicant’s goods despite the fact that it was a geographical name of a State in America. After approving Lord Parker’s test in Du Cros and Hamilton LJ’s observation in RJ Lea, his Honour explained that directly descriptive words, like geographical names, are not prima facie suitable for the grant of a monopoly because use of them as trade marks will rarely eclipse their “primary” (that is, ordinary) signification. Such a word, his Honour said, “is plainly not inherently, that is in its own nature, adapted to distinguish the applicant’s goods”. Traders may legitimately want to use such words in connection with their goods because of the reference they are “inherently adapted to make” to those goods. Kitto J’s elaboration of the principle, derived from Lord Parker’s speech in Du Cros, applies with as much force to directly descriptive words as it does to words which are, according to their ordinary signification, geographical names.

212    Although Cantarella Bros was concerned with the question of whether foreign words were inherently adapted to distinguish, the judgment of the majority is also relevant to English words. Their Honours said at [59]:

The principles settled by this court (and the United Kingdom authorities found in this court to be persuasive) require that a foreign word be examined from the point of view of the possible impairment of the rights of honest traders and from the point of view of the public. It is the “ordinary signification” of the word, in Australia, to persons who will purchase, consume or trade in the goods which permits a conclusion to be drawn as to whether the word contains a “direct reference” to the relevant goods (prima facie not registrable) or makes a “covert and skilful allusion” to the relevant goods (prima facie registrable). When the “other traders” test from Du Cros is applied to a word (other than a geographical name or a surname), the test refers to the legitimate desire of other traders to use a word which is directly descriptive in respect of the same or similar goods. The test does not encompass the desire of other traders to use words which in relation to the goods are allusive or metaphorical. In relation to a word mark, English or foreign, “inherent adaption to distinguish” requires examination of the word itself, in the context of its proposed application to particular goods in Australia.

213    The majority continued:

[70]     In accordance with the principles established in Mark Foy’s and restated in Clark Equipment, Faulding and Burger King, determining whether a trade mark is “inherently adapted to distinguish”, as required by s 41(3), requires consideration of the “ordinary signification” of the words proposed as trade marks to any person in Australia concerned with the goods to which the proposed trade mark is to be applied.

[71]     As shown by the authorities in this court, the consideration of the “ordinary signification” of any word or words (English or foreign) which constitute a trade mark is crucial, whether (as here) a trade mark consisting of such a word or words is alleged not to be registrable because it is not an invented word and it has “direct” reference to the character and quality of goods, or because it is a laudatory epithet or a geographical name, or because it is a surname, or because it has lost its distinctiveness, or because it never had the requisite distinctiveness to start with. Once the “ordinary signification” of a word, English or foreign, is established an inquiry can then be made into whether other traders might legitimately need to use the word in respect of their goods. If a foreign word contains an allusive reference to the relevant goods it is prima facie qualified for the grant of a monopoly. However, if the foreign word is understood by the target audience as having a directly descriptive meaning in relation to the relevant goods, then prima facie the proprietor is not entitled to a monopoly of it. Speaking generally, words which are prima facie entitled to a monopoly secured by registration are inherently adapted to distinguish.

(Footnotes omitted.)

214    In Registrar of Trade Marks v W & G Du Cros Ltd [1913] AC 624 at 635, Lord Parker said that the registrability of a trade mark as being distinctive should:

…largely depend upon whether other traders are likely, in the ordinary course of their business and without any improper motive, to desire to use the same mark, or some mark merely resembling it, upon or in connection with their own goods.

215    In Cantarella Bros the majority said of this passage at [73]:

Lord Parker was not referring to the desire of traders to use words, English or foreign, which convey an allusive or metaphorical meaning in respect of certain goods.

216    In Mantra IP Pty Ltd v Spagnuolo (2012) 205 FCR 241, Reeves J at [52] referred to the authorities concerning s 41(3) and summarised the principles as follows:

In summary, the principles that can be extracted from these authorities, bearing on the assessment required by s 41(3) of the Act in the present case, are as follows. [The opponent] bears the onus of persuading the court on the balance of probabilities that the word mark “Q1” should not be registered. In discharging that onus, regard must be had to the presumption of registrability in s 33 of the Act. The assessment under s 41(3) looks to the mark itself and its inherent nature; it does not take into account the effect of use; it considers how the mark would be understood by ordinary Australians seeing it for the first time. The question can be tested by asking whether other traders trading in services of the same or a similar kind and only actuated by proper motives are likely to want to use the mark in connection with the same or similar services. A proper motive is one founded on the “common right of the public to make honest use of words forming part of the common heritage”. Signs that are descriptive in nature, or use a geographical name, form part of the “common heritage” and, therefore, cannot usually be inherently distinctive. This test is to be applied negatively, not positively and the assessment is to involve a “practical evaluative judgment…in the real world”.

217    I respectfully adopt the summary of principles given by Reeves J, subject to reading them in the context of the decision in Cantarella Bros.

218    The cross-claimants submit that the trade marks are not inherently adapted to distinguish the services of Accor or CHL from the services of other persons in circumstances where:

(a)    HARBOUR LIGHTS simply adopts the names of the community titles schemes;

(b)    CAIRNS HARBOUR LIGHTS simply adopts the names of the community titles schemes save for the word “Cairns”, which is the name of the city in which the schemes are located and which forms part of the common heritage;

(c)    at the time of applying for registration of the trade marks, CHL was not the sole owner of all apartments in the Harbour Lights schemes; and

(d)    the schemes are governed by by-laws which prevent the body corporate from entering into an exclusive letting rights agreement in relation to all the residential apartments in the schemes (ss 16(2), 169(1) and 180(3) and (4) of the Body Corporate and Community Management Act 1977 (Qld) (“the BCCM Act”)), meaning that individual lot owners have the right to use whomever they wish to let their apartments.

219    The cross-claimants submit that other traders, including other lot owners and their agents, will want to, and in fact need to, use the names “Harbour Lights” and “Harbour Lights Cairns” legitimately (that is, without any intention to trade on the reputation of Accor or CHL) for the sake of geographical reference. They submit that the trade marks are descriptive of a characteristic or quality of the services offered by Accor or CHL, namely that they are used in connection with a geographic location. They submit that the services are connected with the lots comprising the two community titles schemes. The lots are real property and are a geographic location, and the services comprise of provision of an entitlement to occupy a geographic location. They submit that the services are so closely related to the lots that the services are largely indistinguishable from the lots themselves.

220    The cross-claimants submit that other traders, whether lot owners or their agents, would seek to use the name of the community titles schemes for their ordinary geographic significance. They submit that other traders would of necessity refer to the lots comprised in the community titles schemes to describe the services offered by them, namely the entitlement to occupy the lots comprised in the scheme.

221    The cross-claimants submit that lot owners in a community titles scheme have a common heritage. They argue that it follows that the lot owners have a right in common with other owners to use the name of the scheme to signify the location of their apartments which they let, in the same way that traders in a town have a right to use the name of the town to signify the location of their services provided from within the town.

222    The cross-claimants also argue that permitting an on-site agent to register as a trade mark the name of a community titles scheme is contrary to the provisions of the BCCM Act, which are designed to give lot owners freedom of choice as to whomever they wish to act as their agent to let their apartments.

223    The cross-claimants rely on Note 1 to s 41(6), which stated that trade marks that are not inherently adapted to distinguish goods, are mostly those that consist wholly of a sign that is ordinarily used to indicate the kind, quality, quantity, intended purpose, value, geographical origin or some other characteristic of the goods or the time of production of goods. In Ocean Spray Cranberries Inc v Registrar of Trade Marks (2000) 47 IPR 579, Wilcox J at [30] noted that although the note “does not have legislative force… it fairly reflects the trend of relevant judicial authority”.

224    The cross-respondents submit that the present case is indistinguishable from Mantra IP v Spagnuolo and Mantra Group v Tailly where the same issues were decided. They submit that “Harbour Lights” was coined by CHL, is not descriptive, is not a geographical name and is not part of the common heritage. They argue that registration of the trade marks does not prevent lot owners from using the words “Harbour Lights” to describe the place where their apartment is located, but merely prevents them from carrying on a business under that name.

225    The issue under s 41(3) is the extent to which the trade marks HARBOUR LIGHTS and CAIRNS HARBOUR LIGHTS are inherently adapted to distinguish the services of Accor from those of others. In Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417, Gibbs J said at 424:

Inherent adaptability is something which depends on the nature of the trade mark itself…and therefore is not something that can be acquired; the inherent nature of the trade mark cannot be changed by use or otherwise.

226    In Kenman Kandy Australia Pty Ltd v Registrar of Trade Marks (2002) 122 FCR 494, Lindgren said at [84]:

While inherent adaptation to distinguish requires attention to be focused on the mark itself, and is intended to stand in sharp contrast to a mark's capacity to distinguish arising from use, the notion of “the mark itself” does not exclude from consideration the nature of the range of goods within the class or classes in respect of which registration is sought, or the various ways in which the mark might, within the terms of the registration, be used in relation to those goods. Indeed, those matters must be taken into account.

227    It is necessary to commence by considering the ordinary signification of the trade marks to persons who will trade in or use the service to which the trade mark is applied, namely lot owners, travel agents and potential guests.

228    I will start with HARBOUR LIGHTS. The cross-claimants point out that these are not invented words. HARBOUR LIGHTS is a well-known combination of ordinary English words. That combination is used in ordinary language to refer to the collection of lights around a harbour and the lights on boats or structures in a harbour.

229    When used in relation to services involving some form of accommodation, HARBOUR LIGHTS suggests that the accommodation has views of a harbour and is close to a harbour. However, to an ordinary person looking at the words for the first time, they do not directly describe a characteristic of the accommodation, in the way that something like “Harbour View” or “Harbour Side” might. The words HARBOUR LIGHTS allude to certain characteristics, but do not directly describe those characteristics. I consider that the words are in the nature of a “covert and skilful allusion” to the services, which make them prima facie registrable. In my opinion, the words HARBOUR LIGHTS are not descriptive of a characteristic of the services provided by Liv and Accor.

230    Liv and Ms Bradnam submit that HARBOUR LIGHTS is a geographical name, being the name of the community titles schemes and the building. In Mantra IP v Spagnuolo, Reeves J rejected such an argument, saying at [59]:

Thus, it is apparent from what the Full Court said (above) in MID Sydney that a sign concurrently applied as the name of a privately owned building and to distinguish certain services to be provided from, or in relation to, that building, does not lose its inherent adaptability to distinguish the services concerned. The Full Court appears to have reached that conclusion because the name of a privately owned building cannot be regarded as being the equivalent of a geographical place name such that it is to be considered as part of the “common heritage” over which the public, including a competitor trading in, or near, the building can claim to have a public right to make honest use of that sign in relation to its goods or services. In other words, its use as a trade mark will not, in any way, infringe upon the “common heritage” because its concurrent use as a building name does not bring it within that domain. This does not, of course, prevent a trader operating within the building concerned from using the name of the building to indicate the location of its place of business.

231    Nor does the name HARBOUR LIGHTS otherwise indicate a geographical origin. In the context of s 122(1)(b) of the TMA, Reeves J in Mantra Group v Tailly held at [87]-[88]:

[T]he word “geographical” in s 122(1)(b) was intended to protect the common right of the public to use words forming part of the common heritage, specifically, the name of a country, region, city or town. On the other hand, they suggest that word was not intended to extend to a large privately owned residential apartment building like the Circle on Cavill complex that could not be said to be a part of the common heritage, any more than it did to the large privately owned city office building in the MID Sydney case.

…

Taking into account all these matters, I consider the words “geographical origin … of … service” in s 122(1)(b) are to be construed to refer to the name of a country, region, city, town or similar geographical area from which a trader’s goods or services have been derived, but not to refer to a privately owned building situated within such a city or town, such as the Circle on Cavill complex in this case.

232    I respectfully agree with the views of Reeves J. I do not accept that HARBOUR LIGHTS is descriptive of a geographical location connected with the services, even though they reflect the name of the building connected with the services. The fact that the services are connected with real property and that the services comprise of provision of an entitlement to occupy that real property does not affect the inherent adaptability of the relevant words to distinguish.

233    The cross-claimants point out that their argument that lot owners in a community titles scheme have a common heritage and common right to use the name of the scheme to signify the location of their apartments was not made in Mantra IP v Spanguolo or in Mantra Group v Tailly. That argument stems from the “common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess” identified by Kitto J in Clark Equipment Co. In Mark Foy’s Ltd v Davies Co-op & Company Ltd (1956) 95 CLR 190 at 199, Williams J quoted from the speech of Lord Herschell in Eastman Photographic Materials Company Ltd v Comptroller-General of Patents, Designs, and Trade-Marks [1898] AC 571 at 580:

“The vocabulary of the English language is common property: it belongs alike to all; and no-one ought to be permitted to prevent the other members of the community from using for purposes of description a word which has reference to the character or quality of goods”.

234    In Mantra IP v Spagnuolo, Reeves J at [55] identified the principle as being that a sign is not inherently adapted to distinguish where it includes words or names over which there is a common or public right of use in that they form part of the common heritage.

235    The “words forming part of the common heritage” described by Kitto J are those words available to all members of the community, rather than to a small section of the community. Such words include descriptive words and geographical locations.