FEDERAL COURT OF AUSTRALIA

Harcourts WA Pty Ltd v Roy Weston Nominees Pty Ltd (No 5) [2016] FCA 983

ORDERS

THE COURT ORDERS THAT:

1.    There be judgment for the applicant and cross-respondent (applicant).

2.    The cross-claim of the respondent and cross-claimant (respondent) be dismissed.

3.    Pursuant to s 88(1) of the Trade Marks Act 1995 (Cth), the Register of Trade Marks be rectified by cancellation of the respondent's:

(a)    Australian registered trade mark number 1336120 for Roy Weston Real Estate registered in class 36; and

(b)    Australian registered trade mark number 1154742 for Roy Weston Nominees The Trusted Name In Real Estate registered in class 36.

4.    The respondent, whether by itself, its directors, officers, employees or agents be restrained from infringing the applicant’s Australian registered trade mark numbered 921651 for the mark Roy Weston, registered in class 36 (applicant's trade mark 921651).

5.    Commencing on or from 3 months from the date of the final costs orders, the respondent, whether by itself, its directors, officers, employees or agents or otherwise be restrained from using, including by licensing other parties to use:

(a)    the name Roy Weston;

(b)    the applicant's trade mark 921651; and

(c)    any name, word, mark, sign or device which is substantially identical with or deceptively similar to the applicant's trade mark 921651,

in the course of trade, or in relation to any services (or any services that are closely related) to those for which the applicant's trade mark 921651 is registered, or in connection with the advertising, promotion, marketing and provision of such services or any other goods and services in relation to such services, without the authority of the applicant.

6.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise be restrained from representing that:

(a)    the respondent is the owner of the applicant's trade mark 921651 and all similar names or logos comprising or incorporating the words Roy Weston;

(b)    the respondent conducts its business under licence or authority of the applicant;

(c)    the respondent has a connection or association with the applicant;

(d)    the respondent has the sponsorship, approval of, or an affiliation with, the applicant;

(e)    the products and/or services of the respondent are supplied by or on behalf of the applicant;

(f)    the products and/or services of the respondent have a connection or association with the applicant; and/or

(g)    the products and/or services of the respondent have the sponsorship or approval of the applicant,

(collectively, the Representations) by using in any manner the Roy Weston name, any of the respondent's Marks, the applicant's trade mark 921651 or any other name, word, mark, sign or device which is misleadingly, deceptively or confusingly similar to the applicant's trade mark 921651.

7.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise be restrained from passing off:

(a)    the respondent's business as a business conducted under the licence or authority of the applicant;

(b)    the respondent as having a connection or association with the applicant;

(c)    the respondent's services as services which have a connection or association with the applicant;

(d)    the respondent as having the sponsorship or approval of, or an affiliation with, the applicant; and/or

(e)    the respondent's services as having the sponsorship or approval of the applicant.

8.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise, within 3 months of the date of this order, is directed to do all acts and execute all such documents as may be necessary or desirable to be done or executed in order to:

(a)    cancel the registration of:

(i)    the respondent's registered business names 'Roy Weston Real Estate' and 'Roy Weston Nominees'; and

(ii)    any White Pages, telephone or other directory listing the respondent has under or by reference to the name Roy Weston;

(b)    remove the name Roy Weston and any word or phrase substantially identical with or deceptively similar to the name Roy Weston from the respondent's real estate licenses, permits and approvals, and those of its directors, officers, employees and contractors;

(c)    change its corporate name from 'Roy Weston Nominees Pty Ltd' to some other name not incorporating the name Roy Weston or any word of phrase substantially identical with or deceptively similar to the name Roy Weston, and to have the change of name registered in the Register of Corporations kept and maintained by the Australian Securities and Investments Commission; and

(d)    transfer to the applicant the registration of the domain names royweston.net.au, roywestonnom.com.au, roywestonrealestate.com and roywestonrealestate.com.au.

9.    The respondent is directed to deliver up within 3 months to the Applicant or its duly authorised agent for destruction all signs, signboards, uniforms, brochures, marketing and promotional material, stationery and other documents, materials and things (regardless of form) incorporating referring to the name 'Roy Weston' or the applicant's trade mark 921651, that are in the respondent's services in the possession, custody or control of the respondent.

10.    The Court declares that, by making the Representations, the respondent has:

(a)    in trade or commerce engaged in conduct which is misleading and/or deceptive and likely to mislead or deceive in contravention of s 18 of the Australian Consumer Law set out in Sch 2 of the Competition and Consumer Act 2010 (Cth) (Australian Consumer Law); and

(b)    engaged in passing off.

11.    An account of the profits made by the respondent by the said infringements between 1 September 2013 and the date of these orders and payment of the amount found to be due on the taking of such account, pursuant to s 126 of the Trade Marks Act 1995 (Cth).

12.    The respondent pay the applicant’s costs of the proceeding on a basis to be determined by further order.

13.    The operation of the above orders be stayed until a final order as to costs is made or until further order of the Court.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 92 of the Trade Marks Act 1995 (Cth), the Register of Trade Marks be rectified by cancellation of the respondent’s Australian registered trade mark numbered 821667, for the mark The House Sold Word in Real Estate, registered in class 36.

2.    The applicant’s claim otherwise be dismissed.

3.    The applicant’s application for removal of the Australian registered trade mark numbered 921651 for the mark Roy Weston, registered in class 36 be dismissed.

4.    The applicant pay the respondent’s costs of the proceedings, the proportion and basis of which to be determined.

5.    The operation of the above orders be stayed until an order as to costs is made or until further order of the Court.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MCKERRACHER J:

INTRODUCTION

1    These reasons address the dispositive orders following findings reached after trial in Harcourts WA Pty Ltd v Roy Weston Nominees Pty Ltd (No 4) [2016] FCA 138 (Harcourts No 4). In order to understand these reasons and orders, it is necessary to take into account the content of Harcourts No 4.

2    As was plain from Harcourts No 4, there were two different proceedings in issue, WAD 167 of 2013 and SAD 224 of 2012. The two proceedings were heard together in one trial.

THE RWN NON-USE PROCEEDINGS (WAD 167 OF 2013)

3    There is a debate between the parties as to the appropriate costs disposition. I have resolved that debate (below) in substance, but not precise detail as I was asked to generally (as I took it) defer orders on costs until further addressed on them. I apprehend that request pertained to the SAD proceeding, but as a precaution, have not made specific costs orders in this proceeding either.

4    Harcourts WA contends that costs should follow the event. It successfully defended the non-use application with respect to the mark ‘Roy Weston’ brought by RWN. The relevant findings were that:

(a)    the non-use application with respect to the mark ‘Roy Weston’ by RWN could not succeed (Harcourts No 4 at [220]);

(b)    had it been necessary, I would have exercised a discretion to not grant the relief sought by RWN in the non-use proceedings (Harcourts No 4 at [224]); and

(c)    the mark ‘The House Sold Word in Real Estate’ should be expunged from the Register for non-use (Harcourts No 4 at [231]).

5    Shortly put, RWN’s success was limited to its application that ‘The House Sold Word in Real Estate’ should be cancelled. Otherwise, the application was dismissed. Harcourts WA advanced no evidence to support usage of this trade mark and advanced no submissions on the point. Little, if any, time at trial was devoted to this issue. Otherwise Harcourts WA was successful in relation to the issues agitated at trial.

RWN’s contentions

6    RWN contends that Harcourts WA has engaged in prolonged and systematic delay in both sets of proceedings, which has had a significantly adverse impact on RWN’s rights, which should affect the orders to be made consequent upon the findings in Harcourts No 4.

7    Harcourts WA says that the delay is obvious from the facts set out in an affidavit of M/s Grace Ng of 11 October 2012, which reveal that:

(a)    on 22 July 2011, the non-use proceedings were commenced by Roy Weston in the Trade Marks Registry;

(b)    on 7 September 2011, Harcourts WA filed a notice of opposition;

(c)    on 5 December 2011, Harcourts WA sought an extension of time;

(d)    on 21 December 2011, Harcourts WA sought a further extension of time;

(e)    on 6 February 2012, Harcourts WA sought a further extension of time;

(f)    on 7 March 2012, Harcourts WA sought a further extension of time;

(g)    on 4 April 2012, Harcourts WA sought a further extension of time;

(h)    on 2 May 2012, Harcourts WA sought a further extension of time; and

(i)    on 31 May 2012, Harcourts WA sought an extension of time.

8    The final extension of time granted to Harcourts WA was to 7 September 2012, by which date all evidence in support of its opposition to the removal proceedings was to be filed. RWN says there was no credible justification for the repeated delays which took the filing of evidence out beyond the maximum benchmark usually applied. I do note, however, that it is apparent from a brief review of the material annexed to the affidavit that at least the final extension granted was on the basis that the parties had been involved in negotiations (as was indicated by a letter from Elevation Legal and Harcourt WA’s extension application).

9    On 6 September 2012, Harcourts WA filed the proceedings in SAD 224 of 2012 and sought suspension of the trade mark removal proceedings. Subsequently the proceedings were transferred to the Western Australian District Registry of this Court and became proceeding WAD 167 of 2013 (RWN non-use proceedings).

10    By orders of the Court the statutory declaration of M/s Musca of 26 October 2012 (which dealt with the Roy Weston Medal, the Wall of Fame and website redirection) was admitted as Harcourts WA’s evidence in chief. RWN submits that no further substantive attempts to adduce, or to file, any evidence in the case were made until February 2014, approximately one week before the proposed trial date. On this occasion, Harcourts WA filed considerable and significant new evidence on or around 12 February 2014 in the SAD proceedings, and brought two separate applications to seek leave to rely on that evidence, which had otherwise been relied upon only in the SAD 224 of 2012 proceedings. As I noted in Harcourts WA Pty Ltd v Roy Weston Nominees Pty Ltd (No 2) [2014] FCA 107 (Harcourts No 2) and Harcourts WA Pty Ltd v Roy Weston Nominees Pty Ltd (No 3) [2014] FCA 133 (Harcourts No 3), the delay and timing of these actions had a significant impact on the proceedings and, if allowed, changed the nature of the case faced by RWN. It also resulted in the trial date, which had then been set, being vacated, and with the addition of a number of further steps and the filing of further evidence, relisted about six months later. RWN says it was entitled to consider that the only evidence it was required to deal with was the statutory declaration of M/s Musca by virtue of orders made by this Court: Harcourts No 2 (at [22]). RWN submits that only on the last business day before the intended trial date in February 2014, nearly two and a half years after the non-use application was filed, did Harcourts WA produce the evidence that ultimately prevailed at the rescheduled trial in October 2014. Not only was this unfairly prejudicial on their case, RWN submits, but it also had a significant impact on costs.

11    In contrast, had the evidence been presented at the correct time in the ‘cost effective’ IP Australia trade mark proceedings commenced by RWN, it would have changed the advice given to RWN at an appropriate time before the matter became two sets of Federal Court proceedings with the associated costs involved. RWN complains that no adequate or plausible explanation has been offered by Harcourts WA for the extended delay in production of the new evidence. The attempted ‘ambush’ on the eve of trial, RWN complains, comes close to an abuse of process, but, on any view, should be sanctioned with a costs order in RWN’s favour.

12    RWN stresses that it was successful in part as it was necessary to go to trial in order to prove that ‘The House Sold Word in Real Estate’ should be removed as a trade mark. Accordingly, RWN seeks a costs order in its favour.

Consideration

13    Of the whole of the trial, extremely little time was taken with the ‘The House Sold Word in Real Estate’ issue. Only one paragraph of the reasons was devoted to it (Harcourts No 4 at [231]). There is no doubt whatsoever that the bulk of the evidence on the RWN non-use proceedings was directed to the ‘Roy Weston’ trade mark, on which RWN failed. Additionally, the defences of abandonment and acquiescence occupied a substantial portion of the trial. Harcourts WA was wholly successful in its defence regarding the ‘Roy Weston’ trade mark.

14    Harcourts WA contends that, as the outcome of the RWN non-use proceedings was overwhelmingly in its favour, costs should follow the event and be awarded to it.

15    In relation to delay, in my view, RWN’s submissions overstate the position. The practical reality is that the two sets of proceedings have been running side by side during the directions hearings. As a result, there is no doubt, as is evident on reading the reasons in Harcourts No 4, that the two sets of proceedings were and are inextricably linked. The SAD 224 of 2012 proceedings commenced by Harcourts WA have been on foot since September 2012 and were preceded by a number of demands, some of which are referred to in Harcourts No 4. For example, a demand on 15 September 2011 (Harcourts No 4 at [43])). Further, following the transfer of the RWN non-use proceedings to the Western Australian Registry of this Court, it is clear that both parties sought extra time. For example, the Court ordered by consent, on 3 December 2013, that the time for the parties to file and serve their evidence in chief be extended to 23 December 2013 and the time for the parties to file and serve their evidence in response be extended to 29 January 2014. The record shows that there was late compliance by RWN with these orders, which in turn gave rise to a further extension of the time for the parties to file evidence in response (by consent). Accordingly, the evidence filed in response by Harcourts WA was not late.

16    RWN submitted that the ‘game changer’ was in the additional evidence adduced by Harcourts WA after the first trial date. RWN says different advice might have been given had there been time. In my view, there was ample opportunity, always firmly encouraged by the Court, for negotiation between the parties after the additional evidence from Harcourts WA became apparent. While the Court is not aware of what steps, if any, were taken by RWN to attempt to negotiate a resolution of the proceedings, the submission of RWN does tend to suggest that it pushed the matter on to trial, even though different advice might have been given had the full position been known earlier.

Conclusion

17    In the RWN non-use proceedings (WAD 167 of 2013), in my view, Harcourts WA are entitled to most of its costs, but I consider that costs should be discounted partially in relation to the trade mark issue on which it lost and partially, and more importantly, in relation to the delay in applying for evidence in the SAD proceedings to be evidence in this proceeding. I propose to finalise the orders as to costs at the next hearing.

18    The remaining orders in relation to the RWN non-use proceedings are not particularly controversial. I make orders in terms of paras 1-3 of the Harcourts WA minute filed on 15 April 2016. Paragraph 4 will be that the applicant pay the respondent’s costs of the proceeding, the basis of which will be determined at the next hearing. Paragraph 5 provides for a brief stay of the operation of the orders (until any further order as to costs or further order of the Court), with the intention that the parties have an opportunity to address me on it at the further costs hearing.

THE HARCOURTS WA TRADE MARK INFRINGEMENT PROCEEDINGS (SAD 224 OF 2012)

19    In this proceeding I am specifically asked to make no order as to costs at present due to information which will be made known to the Court at a subsequent hearing.

20    The orders under debate in this proceeding are more complex.

Harcourts WA’s contentions

21    Harcourts WA seeks judgment and dismissal of the RWN cross-claim, together with cancellation of the ‘Roy Weston Real Estate’ trade mark and ‘Roy Weston Nominees the Trusted Name In Real Estate’ trade mark. It seeks injunctive relief restraining RWN with respect to further infringements, misleading conduct and passing off. It seeks orders requiring positive steps to be taken for removal and delivery up on offending material. It elects an account of profits over damages and seeks costs. It contends that costs should be paid on an indemnity basis, but seeks deferral of any order on costs until further evidence is adduced.

22    Harcourts WA argues that the injunctive relief it seeks is justified as a consequence of comprehensive findings in its favour to the effect that:

(a)    RWN’s application for registration of RWN’s trade marks was based on representations, and false and misleading particulars, contrary to s 62(b) of the Trade Marks Act 1995 (Cth) (TMA) (Harcourts No 4 at [282]-[283]);

(b)    Harcourts WA established that RWN infringed a trade mark by its use of the Harcourts Trade Marks without authority, contrary to s 120(1) and (2) TMA (Harcourts No 4 at [287] and [290]);

(c)    RWN’s conduct in respect of the Harcourts Trade Marks constituted both passing off and misleading and deceptive conduct contrary to s 18, Sch 2 to the Competition and Consumer Act 2010 (Cth), the Australian Consumer Law (ACL) (Harcourts No 4 at [293]);

(d)    RWN went well beyond the use of its own company name and engaged and continues to engage in use of a range of other marks which infringe Harcourts WA trade mark for ‘Roy Weston’ (Harcourts No 4 at [300]);

(e)    the defence under s 122(1)(a)(i) TMA was not available to RWN (Harcourts No 4 at [303]); and

(f)    RWN’s defence of prior use under s 124 TMA was rejected (Harcourts No 4 at [307]).

23    Harcourts WA says that it follows, from those findings, that RWN should be restrained from ongoing activity in the nature of the impugned conduct. A further consequence is that RWN should have to take certain positive steps to ensure that the impugned conduct ceases.

24    Harcourts WA contends there was a clear course of conduct by which it consistently rejected RWN’s assertion of a continuing entitlement to use the ‘Roy Weston’ trade mark. In particular, the findings reject Mr Taylor’s suggestion that Harcourts WA had consented to RWN’s conduct (Harcourts No 4 at [153]). There was also a finding (at [250]) that, although RWN asserts that the 2002 Franchise Agreement came to an end by reason of Harcourts WA’s repudiation (which Harcourts WA denies), on expiry or termination of the 2002 Franchise Agreement pursuant to cl 15.1, RWN was obliged to desist from using any of the Roy Weston Identifications, which included the ‘Roy Weston name’, to revest ownership of any trade marks, business names or other intellectual property which comprised ‘Roy Weston Identifications’, to cause the name Roy Weston Morley to be transferred to Harcourts WA, to discontinue all use of ‘Roy Weston Identifications’ and, absent prior consent in writing, to desist from conducting any business under the Roy Weston Identifications coupled with any name. There was no prior consent in writing and RWN did not carry out the obligations under cl 15.4. Those obligations covered the field arising in the dispute.

25    The findings were based on a series of actions by Harcourts WA, including:

(a)    correspondence and discussions between Mr Taylor and Mr Shane Kempton in December 2006 (Harcourts No 4 at [241]);

(b)    a defensive domain name registration by Harcourts WA (Harcourts No 4 at [243]);

(c)    the series of letters of demands sent to RWN by Harcourts WA, including:

(i)    the first letter of demand sent by Deacons to RWN dated 24 January 2007;

(ii)    the second letter of demand sent by Deacons to RWN dated 14 February 2007;

(iii)    the third letter of demand sent by Deacons to RWN dated 14 January 2008;

(iv)    the fourth letter of demand from Deacons to RWN dated 11 June 2008;

(v)    the fifth letter of demand from Deacons to RWN dated 14 October 2008; and

(vi)    the first letter of demand from Minter Ellison to RWN dated 15 September 2011.

26    Harcourts WA submits that it follows from the above series of actions and correspondence that RWN was aware that:

(a)    RWN had no right to continue to use the Roy Weston name after the 2002 Franchise Agreement came to an end;

(b)    RWN had no right to continue to use Harcourts WA's ‘Roy Weston’ trade mark after the 2002 Franchise Agreement came to an end;

(c)    RWN's conduct infringed Harcourts WA's right in the ‘Roy Weston’ trade mark;

(d)    RWN's conduct in relation to the use of the ‘Roy Weston’ trade mark after the 2002 Franchise Agreement came to an end amounted to misleading and deceptive conduct, false representations, passing off and/or a breach of the 2002 Franchise Agreement; and

(e)    RWN's conduct in seeking to register and/or registering trade marks substantially identical with or deceptively similar to the ‘Roy Weston’ trade mark infringed the rights of Harcourts WA in the ‘Roy Weston’ trade mark.

27    Harcourts WA also relies on the following finding (Harcourts No 4 at [273]):

Contrary to the contention of RWN, in my view, Harcourts WA remained the true owner of the RWN Trade Marks. The name ‘Roy Weston’ was associated with the Harcourts’ business since its incorporation on 30 January 1985. The ‘Roy Weston’ name in connection with the real estate affairs was that of Mr Roy Weston personally. Mr Weston commenced using the name ‘Roy Weston’ in connection with the real estate agency business in 1957 and later traded under the name as part of the unincorporated partnership, Roy Weston and Co, and that partnership expanded the business, granting licences to third parties to use the ‘Roy Weston’ name and brand as franchisees. Harcourts WA have established that there is a trail of ownership in the trade mark Roy Weston from Mr Weston personally through to the Roy Weston and Co partnership to Roy Weston Pty Ltd, and then to Harcourts WA. When M/s Musca commenced working, there were three partners. Shortly after that, Mr Weston ceased attending the business and the two remaining partners, Mr Park and Mr Newman, were inaugural directors of Harcourts. In that capacity, Harcourts WA became the true owner of the ‘Roy Weston’ mark. There is no evidence of any assignment to RWN or acquisition of ownership by RWN occurring. There is also no satisfactory evidence to support any transfer of the ownership to RWN. Had the Registrar known all these facts, it is likely that the RWN Trade Marks would not have been accepted for registration in the name of RWN.

28    In those circumstances, it is argued that there is no likelihood that the granting of the injunctions, which Harcourts WA seeks, would enable Harcourts WA to ‘take advantage of the reputation and goodwill’ of RWN in the sense discussed in Knott Investments Pty Ltd v Winnebago Industries Inc (2013) 211 FCR 449 (at [121]).

29    As to the delay in seeking injunctive relief, to which reference was made in Harcourts No 4, Harcourts WA submits that an applicant’s delay is a discretionary factor that weighs against the grant of injunction, but only where it has caused prejudice to the respondent. Mere delay with a reasonable explanation for the delay will not of itself usually prevent the grant of an injunction. Harcourts WA relies upon Lindsay Petroleum Co v Hurd (1874) LR 5 PC 221 (at 239-240), which was approved in Goldie v Getley (No 3) [2011] WASC 132 by Simmonds J (at [231]) and in Knott Investments by the Full Court (Allsop CJ, Cowdroy and Jagot JJ) (at [97]-[100]) in support of this proposition.

30    Harcourts WA contends there is no evidence of any prejudice suffered by RWN as a result of Harcourts WA’s delay. To the contrary, the delay has enabled RWN to continue to enjoy use of the ‘Roy Weston’ name and simply deferred the rebranding exercise it would otherwise have had to undertake at the conclusion of the 2002 Franchise Agreement in any event.

31    The terms of the relief sought by Harcourts WA to some extent take into account its own delay in proposing restraints and consequential orders, which rather than having immediate effect a delay for a period of three months, allow RWN an appropriate time to organise its affairs so as to cease the impugned conduct.

RWN’s opposition to the orders in SAD 224 of 2012

32    RWN stresses that Harcourts WA’s conduct in rebranding was found to have amounted to a repudiatory breach of contract, RWN says this finding should give rise to a declaration in favour of RWN that Harcourts WA repudiated the contract. RWN contends that the entire dispute that has followed between the parties stems from that repudiatory conduct. Had Harcourts WA honoured its obligations under the contract, the parties would have remained branded ‘Roy Weston’ under the 2002 Franchise Agreement at the time of the infringing conduct. A declaration in favour of RWN as to repudiation by Harcourts WA is of major importance, it is argued, when coming to consider equitable remedies and the relief sought more broadly.

33    RWN also seeks a declaration as to an absence of any confusion between the trade marks pursuant to the findings made to the following effect (Harcourts No 4 at [275]-[276]):

275    Harcourts WA argue that, in any event, the 2002 Franchise Agreement aside, at the time of registration and at all times since those dates, use of the RWN Trade Marks by RWN was likely and remains likely to cause confusion sufficient to constitute passing off and a breach of s 18 ACL: see Cadbury Schweppes Pty Ltd v Wal-Mart Stores, Inc (2004) 61 IPR 596.

276    I do not consider the evidence rises to this level. The use is minimal. Although the abandonment and non-use claims have failed, there is no evidence of sufficient use in trade of the name Roy Weston by Harcourts WA to demonstrate any likelihood of confusion within the meaning of s 18 ACL. It follows, in my view, that Harcourt WA’s claims with respect to confusion cannot succeed.

34    Again, and perhaps even more so in relation to SAD 224 of 2012, RWN stresses the delay by Harcourts WA. It argues that RWN informed Harcourts WA by its letter of 7 December 2006 that it did not intend to rebrand and that it intended to trade as an independent agency using its own name. This submission does not appear to take into account my findings in Harcourts No 4 as to whether the letter of 7 December 2007 was actually sent to Harcourts WA (particularly Harcourts No 4 at [247]). RWN also says that Harcourts WA was aware of the fact that in January 2007 it applied for the ‘Roy Weston Nominees the Trusted Name in Real Estate’ trade mark as evidenced by the letters sent by its lawyers. Further, RWN points to the fact that M/s Musca of Harcourts WA was contacted by M/s Craig of the Sunday Times and asked to approve Roy Weston’s new logo. M/s Musca emailed Mr Kempton, M/s Jenny Birrell and Mr James Reid in relation to the issue and subsequently Mr Reid of Harcourts WA was also contacted by email from the Sunday Times in the same vein. Again, I note the evidence of M/s Musca (Harcourts No 4 (at [100])), being that M/s Musca was alerted to the unauthorised use of the ‘Roy Weston’ name and she could not recall the response to M/s Craig at The Sunday Times. There is also no finding in Harcourts No 4 as to the knowledge of Mr Reid, nor any contact with The Sunday Times.

35    It is not in dispute, RWN says, that Harcourts WA knew about RWN’s conduct from the outset. That conduct, which has now been held to have amounted to trade mark infringement, passing off, and breach of s 18 ACL, continued unchecked for long time.

Laches

36    RWN argues that while usually (absent the breach of contract and the delay) an order would be made granting relief to Harcourts WA in such a case, RWN has always pleaded that this is a case where Harcourts WA’s acquiescence and delay gave rise to harm to RWN. It relies on the defence of laches. RWN submits that those factors should weigh heavily in determining what relief, if any, should be granted. RWN points to my observation (Harcourts No 4 at [308]):

[I]n my view, consideration of the relief, if any, to which Harcourts WA may be entitled would have to take into account its own delay. In light of this, while there has been no sign of it so far, the parties might both benefit by approaching a mediated resolution.

37    RWN also draws attention to my ‘conclusion’ in Harcourts No 4 at [308], which I return to below.

38    RWN says that it has relied on the status quo, which has continued for nearly ten years following the announcement of the rebranding in December 2006, and has continued to invest in the brand and to run a business that employs a number of staff, as well as having two independent licensees operating under the same mark. It says it has spent a substantial amount of money, exceeding $460,000 in advertising between 2007 and 2012 and considerable other money in respect of the Roy Weston mark, since it started trading independently of the franchise group. In this case, unlike Knott Investments, RWN says that it expressly pleaded acquiescence and delay as opposed to mere estoppel.

39    RWN submits that the appropriate order should be that the registration of the RWN Trade Marks be cancelled, that there be a restraint against certain representations and passing off, a declaration as to contraventions of s 18 ACL and passing off, a declaration as to repudiation, a declaration as to an absence of likelihood of confusion, an order that the parties bear their own costs, and the dismissal otherwise of the application and cross-claim. RWN also seeks an order that RWN may continue to use or license the Roy Weston Identifications.

Consideration

40    Contrary to the RWN submissions, which turn largely on [276], the findings do reflect that RWN has caused confusion and engaged in misleading and deceptive conduct and passing off by reason of its association with the business of Roy Weston which was acquired by Harcourts WA. This is reflected in Harcourts No 4 (at [291]-[293]):

291    Once again, the acknowledgments under the 2002 Franchise Agreement as to the chain of ownership of the relevant trade marks makes it difficult for RWN to resist these claims. It is not necessary that Harcourts WA demonstrate any subjective intent on the part of RWN to mislead consumers. It is sufficient that Harcourts WA demonstrate that by RWN’s conduct using the ‘Roy Weston’ name since the expiry of the 2002 Franchise Agreement, it has misled consumers into believing that it is associated with the Harcourts WA business. For example, in November 2014, on the www.roywestonrealestate.com website, RWN stated:

Welcome to Roy Weston Real Estate. For over 50 years the name Roy Weston has been the trusted name in real estate in Western Australia…

292    As Harcourts WA correctly submits, this is a direct reference to the very same business acquired by Harcourts WA. RWN commenced using the Roy Weston name to conduct its business immediately after RWN ceased as a long standing franchisee and licensee of the ‘Roy Weston’ name. If it be necessary, this is further supported by use of the photograph and signature of the founder of the Harcourts WA business, Mr Roy Weston. The evidence in the case clearly enables Harcourts WA to make out these contentions. The fact that Harcourts WA rebranded is not a defence. Depending on the facts, it may support claims of abandonment and non-use (not in this case), but it is not a defence to these contentions. Harcourts WA case succeeds on these points. RWN has sought to exploit this by granting sub-licences in correspondence in 2013.

293    Accordingly, in my view, RWN’s conduct in respect of the Harcourts Trade Marks constitutes both passing off and misleading and deceptive conduct contrary to s 18 ACL.

41    Further, there was a finding that RWN breached s 120(1) and (2) TMA (Harcourts No 4 at [287]-[290]):

287    In my view, Harcourts WA has established that RWN has infringed a trade mark by its use of the Harcourts Trade Marks without authority.

288    In CSR Ltd v Resource Capital Australia Pty Ltd (2003) 128 FCR 408 it was held (at [38]) that:

the act of obtaining registration of… domain names constituted conduct that was misleading and deceptive or was likely to mislead and deceive persons and breached s 52 of the TPA.

289    The RWN Trade Marks are undoubtedly deceptively similar to the trade mark held by Harcourts WA over ‘Roy Weston’. Section 10 TMA defines ‘deceptively similar’ as follows:

For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

290    There has, therefore, been a breach of s 120(1) and (2).

42    As to the RWN submission that there has not been any confusion, there was certainly no actual evidence of confusion from consumers, experts or others. But, objectively viewed for the purpose of the TMA, there is no doubt that there was a finding of deceptive similarity between the trade marks for the purposes of s 120(1) and (2).

43    Furthermore, notwithstanding the finding that Harcourts WA’s conduct constituted a repudiation, this was irrelevant to resolution of the dispute between the parties. In my view, it had no practical effect or consequence in determining the rights of the parties on the pleaded cases (Harcourts No 4 at [249] and [252]). There is, accordingly, no purpose to be served in granting a declaration as to a repudiation at this point in time years after the event. The finding is on record. A declaration producing no foreseeable consequences for the parties is rarely granted: Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 per Mason CJ, Dawson, Toohey and Gaudron JJ (at 582).

44    It is necessary to consider the issue of delay. This is particularly important in relation to the injunctive relief debate. The starting point is that there was certainly no delay in communicating Harcourts WA’s position to RWN in opposing its conduct. This is relevant in the sense discussed by the High Court in B.M. Auto Sales Pty Ltd v Budget Rent A Car System Pty Ltd (1976) 12 ALR 363 (at 372). Secondly, five letters of demand were sent from Deacons between the period 24 January 2007 and 14 October 2008. It is fair to say that there was no delay in putting Mr Taylor on notice as to Harcourts WA’s assertion as to its legal rights over the relevant trade marks. There was a finding that Mr Taylor took a calculated risk in the face of Harcourts WA’s assertion of rights (see Harcourts No 4 at [153]). This finding precludes any reliance upon estoppel. It is relevant in my view to take into account the conduct of Mr Taylor in respect of the RWN Trade Marks. Each of the statutory declarations filed in support of RWN’s applications for the RWN Trade Marks contained material inaccuracies (Harcourts No 4 at [281]), despite RWN having been put on notice by Deacons as to the position taken by Harcourts WA.

45    Nonetheless, it is true that between 14 October 2008 and September 2011 (a considerable period of time), there was apparently miscommunication within Harcourts WA as to who was dealing with the matter and this oversight or inefficiency, in my view, also has to be taken into account.

46    Delay may be less significant in public interest litigation where the relevant question is whether the public has been misled, which is potentially relevant in this instance to the claim under the ACL. This is reflected in Knott Investments where Allsop CJ said (at [56]):

Final injunctive relief may be refused by reason of delay: Carlton & United Breweries (NSW) Pty Ltd v Bond Brewing New South Wales Ltd (1987) 76 ALR 633 at 638 (per Bowen CJ, Beaumont J and Foster J). To the extent that any injunctive relief is informed by, or founded upon, the protection of the public by enforcement of the Trade Practices Act or Australian Consumer Law, delay, even serious delay otherwise sufficient in equity to disentitle the applicant to relief, may not have that effect, in that the court will be slower to give effect to delay or like considerations, given the wider public interest, beyond mere private rights: World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181 at 189-190 (Bowen CJ), at 195-196 (Franki J) and at 203-204 (Brennan J) and Associated Minerals Consolidated Ltd v Wyong Shire Council [1974] 2 NSWLR 681 at 692-693.

47    Nonetheless, in my view, delay should be taken into account.

48    That does not mean that I agree with the suggestion, in fact I expressly disagree with the suggestion, that any injunction should permit RWN to use the words ‘Roy Weston’ so long as it disassociates its services from those of Harcourts WA. Indeed, the words of disassociation may themselves cause confusion due to the different names now used by RWN and Harcourts WA and, more importantly, be interpreted as being disparaging of Harcourts more broadly. An injunction permitting use of the trade name or mark provided it is coupled with words of disassociation has been refused where it can be regarded as being a way in which the infringer inappropriately distances itself from the innocent party: Bridge Stockbrokers Ltd v Bridges (1984) 4 FCR 460 (at 469 and 472).

49    It needs to be said quite plainly I think (as I said in Harcourts No 4), that Harcourts WA has succeeded on the majority of issues and, in my view (and subject to any appeal), has been successful in the litigation - despite attempts by RWN to paint a brighter picture from its perspective. The essential question has always been who is entitled to use the name ‘Roy Weston’. The conclusion I have reached is that Harcourts WA has that right. Harcourts WA has won on all substantive issues.

50    The fact that there was no evidence of the actual quantum of any damage, like no actual evidence of consumer confusion, simply reflects the difficulty of calling such evidence in a case such as the present. Indeed there is no requirement that actual deception be proven to establish the tort of passing off: Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 234 FCR 549 per Weinberg and Dowsett JJ (at [55]-[62]); Nutrientwater Pty Ltd v Baco Pty Ltd [2010] FCA 2 per Kenny J (at [78]-[83]).

51    Essentially, that is the reason why Harcourts WA elected to pursue an account of profits, about which I will say a little more in a moment. That is not to say that the element of establishing damage for the tort of passing off is not established. Damage in that sense to prove the tort is not required to be proven quantitatively, but to be proven qualitatively by all of the elements of the evidence which make up a passing off claim.

52    Further it must be said that the passage at [308] on which much reliance has been placed by RWN in saying ‘it is not apparent that Harcourts WA has suffered loss or any damage by reason of RWN’s conduct’ was a reference to a submission by RWN not a finding as such. The full context is:

RWN argues there was a ‘legitimate’ basis (I infer, subjectively) to believe there was no foundation in the threats originally made on behalf of Harcourts WA. Furthermore, it is not apparent that Harcourts WA has suffered loss or any damage by reason of RWN’s conduct.

53    While it is common ground that (as with any other tort) damage must be proven, other than in a quia timet action (relevantly and more recently Reckitt & Colman Products Ltd v Borden Inc [1990] RPC 341 (at 406), ConAgra Inc. v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302 and Bodum v DKSH Australia Pty Limited [2011] FCAFC 98 (at [212])), there is no doubt that Harcourts WA has had its intellectual property used for profit for a number of years by RWN. In those circumstances, damage is self-evident and assumed - albeit difficult to prove. As also noted in Nutrientwater (at [79]), if a case of passing off is made out, a court will presume damage, but, as to the measure of damage, the court will consider all the circumstances of the case: see Childrens Television Workshop Inc v Woolworths (NSW) Ltd [1981] 1 NSWLR 273 (at 281-282) per Helsham CJ in Eq and Draper v Trist (1939) 56 RPC 429 (at 442) per Goddard LJ.

54    That is the reason why damages on such claims may be awarded on a ‘user principle’ as explained by Yates J in Winnebago Industries Inc v Knott Investments Pty Ltd (No 4) [2015] FCA 1327 where his Honour said:

13    The underlying principle for damages awarded on [the basis of a reasonable royalty licence fee in respect of the respondents’ use of the relevant marks] the has been called the “user principle”—an expression said to have been coined by Nicholls LJ in Stoke-on-Trent City Council v W & J Wass Ltd [1988] 1 WLR 1406 at 1416. Under this principle, a plaintiff is entitled to recover, by way of damages, a reasonable sum from a defendant who has wrongfully used the plaintiff’s property. The plaintiff may not have suffered actual loss from the use, and the wrongdoer may not have derived actual benefit. Nevertheless, under the principle, the defendant is obliged to pay a reasonable sum for the wrongful use. The reasonable sum is sometimes described as a reasonable rent, hiring fee, endorsement fee, licence fee or royalty (amongst other expressions), depending on the property involved and the nature of the wrongful use.

14    Damages in tort are compensatory. But damages awarded under the user principle have a restitutionary aspect in the sense that the award can be seen to reverse the “use value” of the property in question: see, for example, the explanation in Edelman J, Gain-Based Damages: Contract, Tort, Equity and Intellectual Property (Hart Publishing, 2002) pp 66-71. It has been said, nevertheless, that an award of damages under this principle remains compensatory in character (Tito v Waddell (No 2) [1977] Ch 106 at 335; Jaggard v Sawyer [1995] 1 WLR 269 (Jaggard) at 281-282) or combines elements of compensation and restitution (Inverugie Investments Ltd v Hackett [1995] 1 WLR 713 (Inverugie Investments) at 718). In Attorney General v Blake [2001] 1 AC 268 (Blake), Lord Nicholls suggested (at 279) that an award of damages under the user principle is probably best regarded as an exception to the general rule that damages are compensatory. Even so, Lord Nicholls regarded damages awarded under the principle as “established and not controversial”.

55    The delay to which I have been referring has been the delay in commencing proceedings. I am less persuaded that RWN has made out as strong a case as it suggests for delay in the conduct of the proceedings, although to some extent there appears to have been a difficulty in the adjournment of the initial trial dates. Most of that difficulty appears to arise from Harcourts WA’s intention to expand the evidence upon which it would rely in its case beyond the initial order made by Gilmour J. As to the question of delay, Harcourts WA concede the delay and has apologised for it. It accepts that it was aware of an infringement at the time of the end of the 2002 Franchise Agreement when the first of a series of five letters of demand was sent. That concession was made at trial. The question is whether that delay of perhaps three years or so should preclude Harcourts WA from any injunctive relief. Alternatively, should Harcourts WA have limited injunctive relief?

56    The source of the power to grant an injunction arises under the three heads of breach of the franchise agreement, breach of the TMA and, thirdly, breach of the ACL. None of these breaches is founded in equity. The latter two are statutory and the former injunctive power is an exercise of the auxiliary jurisdiction of equity to support a legal right. This topic is discussed in Heydon, Leeming and Turner, Meagher Gummow and Lehane’s Equity: Doctrines and Remedies (5th ed, 2015) (at 1090) where the learned authors observe that if a plaintiff seeks equitable relief and protection of a purely legal right, other than a claim to specific performance of a contract, it is not easy to make out a defence of laches. The authors point out that an injunction in aid of a legal right is not refused by a court of equity until the legal right is itself statute barred, although in such a case, laches might well bar interlocutory equitable relief.

57    Although the position may be different in England, it appears that in Australia laches may not be available in answer to a legal claim. In obiter remarks Deane J in Orr v Ford (1989) 167 CLR 316 (at 340) said (footnotes omitted):

The availability of a defence of laches and what will suffice to make it good depends upon the nature of the claim. Laches is an equitable defence and is not available in answer to a legal claim.

58    There are cases in Australia which have followed these obiter remarks: see for example Australian Olympics Committee v Big Fights Inc [1999] FCA 1042 (at [387]-[388]). I find it difficult to discern any practical justification for the distinction between the grant of injunctive relief following a legal claim rather than an equitable claim. In reality, however, any decision as to whether or not to grant an injunction, and, if so, on what terms is discretionary.

59    In this instance, RWN has referred to prejudice. The first was incurring the cost of advertising, next was trading under the name ‘Roy Weston’ and, thirdly, was franchising or licencing other parties. Incurring the cost of advertising, like the other two, in my view, is not a prejudice. That is simply part of the conduct which infringes the impugned rights. Shortly put, it is money spent on advertising and other business activities in the name Roy Weston in order to gain benefit from trading under that name. That is not a detriment in the sense contemplated in the cases. More importantly, it is necessary to revert to the finding in Harcourts No 4 (at [153]) that Mr Taylor took a calculated risk in the face of numerous letters of demand, being his conviction that the existence of a repudiation, taken with his control of the company name, meant that he would probably be able to resist any claim by Harcourts WA if it was actually ever pressed.

60    The short position is that, with the passing of the years, RWN has conducted a successful business generating, I infer, profits. In my view, the appropriate recognition of Harcourts WA’s delay is not in declining to grant an injunction that reflects the outcome of the litigation, but, rather, to reflect that delay in a reduction of the period of time in respect of which an account of profits would apply. The period of time would be broadly commensurate with the delay in commencing proceedings.

61    This conclusion in respect of appropriate injunctive relief is consistent with the approach in other cases, such as Knott Investments. In that case, the Full Court held that the owner of the relevant trade marks and name was entitled to injunctive relief despite its knowledge that the infringing party was using the trade marks and name for a period of 25 years and took no action to stop this from happening (albeit the injunctive relief granted was limited to distinguishing the infringing products in future). The injunction restraining the use of a name without a clear differentiating disclaimer in Turner v General Motors (Australia) Pty Ltd (1929) 42 CLR 352 provides another example: one party sought to restrain another from use of a name through commencing litigation approximately 18 months after becoming aware of the infringing use (although, notably, the party complained and wrote a letter to the Registrar-General in the intervening period).

62    In relation to the terms of the injunction, again, for the reasons discussed by the Full Court in Knott Investments (at [56]), I also consider that this is an inappropriate case for words of disassociation. In my view, the injunction should not be qualified.

63    In my view, the appropriate orders to be made in relation to SAD 224 of 2012 are:

1.    There be judgment for the applicant and cross-respondent (applicant).

2.    The cross-claim of the respondent and cross-claimant (respondent) be dismissed.

3.    Pursuant to s 88(1) of the Trade Marks Act 1995 (Cth), the Register of Trade Marks be rectified by cancellation of the respondent's:

(a)    Australian registered trade mark number 1336120 for Roy Weston Real Estate registered in class 36; and

(b)    Australian registered trade mark number 1154742 for Roy Weston Nominees The Trusted Name In Real Estate registered in class 36.

4.    The respondent, whether by itself, its directors, officers, employees or agents be restrained from infringing the applicant’s Australian registered trade mark numbered 921651 for the mark Roy Weston, registered in class 36 (applicant's trade mark 921651).

5.    Commencing on or from 3 months from the date of the final costs orders, the respondent, whether by itself, its directors, officers, employees or agents or otherwise be restrained from using, including by licensing other parties to use:

(a)    the name Roy Weston;

(b)    the applicant's trade mark 921651; and

(c)    any name, word, mark, sign or device which is substantially identical with or deceptively similar to the applicant's trade mark 921651,

in the course of trade, or in relation to any services (or any services that are closely related) to those for which the applicant's trade mark 921651 is registered, or in connection with the advertising, promotion, marketing and provision of such services or any other goods and services in relation to such services, without the authority of the applicant.

6.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise be restrained from representing that:

(a)    the respondent is the owner of the applicant's trade mark 921651 and all similar names or logos comprising or incorporating the words Roy Weston;

(b)    the respondent conducts its business under licence or authority of the applicant;

(c)    the respondent has a connection or association with the applicant;

(d)    the respondent has the sponsorship, approval of, or an affiliation with, the applicant;

(e)    the products and/or services of the respondent are supplied by or on behalf of the applicant;

(f)    the products and/or services of the respondent have a connection or association with the applicant; and/or

(g)    the products and/or services of the respondent have the sponsorship or approval of the applicant,

(collectively, the Representations) by using in any manner the Roy Weston name, any of the respondent's Marks, the applicant's trade mark 921651 or any other name, word, mark, sign or device which is misleadingly, deceptively or confusingly similar to the applicant's trade mark 921651.

7.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise be restrained from passing off:

(a)    the respondent's business as a business conducted under the licence or authority of the applicant;

(b)    the respondent as having a connection or association with the applicant;

(c)    the respondent's services as services which have a connection or association with the applicant;

(d)    the respondent as having the sponsorship or approval of, or an affiliation with, the applicant; and/or

(e)    the respondent's services as having the sponsorship or approval of the applicant.

8.    The respondent, whether by itself, its directors, officers, employees, contractors or agents or otherwise, within 3 months of the date of this order, is directed to do all acts and execute all such documents as may be necessary or desirable to be done or executed in order to:

(a)    cancel the registration of:

(i)    the respondent's registered business names 'Roy Weston Real Estate' and 'Roy Weston Nominees'; and

(ii)    any White Pages, telephone or other directory listing the respondent has under or by reference to the name Roy Weston;

(b)    remove the name Roy Weston and any word or phrase substantially identical with or deceptively similar to the name Roy Weston from the respondent's real estate licenses, permits and approvals, and those of its directors, officers, employees and contractors;

(c)    change its corporate name from 'Roy Weston Nominees Pty Ltd' to some other name not incorporating the name Roy Weston or any word of phrase substantially identical with or deceptively similar to the name Roy Weston, and to have the change of name registered in the Register of Corporations kept and maintained by the Australian Securities and Investments Commission; and

(d)     transfer to the applicant the registration of the domain names royweston.net.au, roywestonnom.com.au, roywestonrealestate.com and roywestonrealestate.com.au.

9.    The respondent is directed to deliver up within 3 months to the Applicant or its duly authorised agent for destruction all signs, signboards, uniforms, brochures, marketing and promotional material, stationery and other documents, materials and things (regardless of form) incorporating referring to the name 'Roy Weston' or the applicant's trade mark 921651, that are in the respondent's services in the possession, custody or control of the respondent.

10.    The Court declares that, by making the Representations, the respondent has:

(a)    in trade or commerce engaged in conduct which is misleading and/or deceptive and likely to mislead or deceive in contravention of s 18 of the Australian Consumer Law set out in Sch 2 of the Competition and Consumer Act 2010 (Cth) (Australian Consumer Law); and

(b)    engaged in passing off.

11.    An account of the profits made by the respondent by the said infringements between 1 September 2013 and the date of these orders and payment of the amount found to be due on the taking of such account, pursuant to s 126 of the Trade Marks Act 1995 (Cth).

12.    The respondent pay the applicant’s costs of the proceeding on a basis to be determined by further order.

13.    The operation of the above orders be stayed until a final order as to costs is made or until further order of the Court.

Associate:

Dated:    22 August 2016