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[2014] ZASCA 173
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Roodezandt Ko-Operatiewe Wynmakery Ltd v Robertson Winery (Pty) Ltd and Another (503/2013) [2014] ZASCA 173; 2014 BIP 294 (SCA) (19 November 2014)
THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
REPORTABLE
Case
No: 503/2013
In
the matter between:
ROODEZANDT
KO-OPERATIEWE WYNMAKERY
LTD
........................................
APPELLANT
and
ROBERTSON
WINERY (PTY)
LTD
...............................................................
FIRST
RESPONDENT
REGISTRAR
OF
TRADEMARKS
.............................................................
SECOND
RESPONDENT
Neutral
citation:
Roodezandt Ko-operatiewe
Wynmakery Ltd v Robertson Winery (Pty) Ltd & another
(503/13)
[2014] ZASCA 173
(19 November 2014).
Coram:
Brand, Maya, Shongwe, Theron JJA
et
Meyer AJA
Heard:
10 November 2014
Delivered:
19 November 2014
Summary:
Trademarks Act 194 of 1993 –
Register of trademarks rectified by removal of the appellant’s
trademark ‘Robertson
Hills’ on the basis that it is so
similar to the first respondent’s marks containing the word
component ‘Robertson’
that it is likely to deceive or
cause confusion as contemplated by sub-sections 10(12) and 10(14) of
the Act.
ORDER
On
appeal from:
North Gauteng High Court,
Pretoria (Mavundla J sitting as court of first instance):
(a)
The appeal is dismissed with costs.
(b)
Save for the amendment in para (c), the order of the high court is
confirmed.
(c)
Paragraph 2 of the high court’s order is amended to read as
follows:
‘
That
the removal of the registration is made in terms of s 24 of the
Trademarks Act 194 of 1993 and deemed to be with effect
from the date
of application for its removal on 19 January 2012.’
JUDGMENT
Brand
JA
(, Maya, Shongwe, Theron JJA
et
Meyer AJA concurring):
[1]
This appeal arises from the application of s 24(1) of the
Trademarks Act 194 of 1993 (the Act) which allows for the
rectification
of the trademarks register, inter alia, by removing an
entry wrongly made or wrongly remaining on the register. The
appellant is
Roodezandt Ko-operatiewe Wynmakery Ltd (Roodezandt). The
first respondent is Robertson Winery (Pty) Ltd (the Winery). The
Registrar
of Trademarks, who was cited as the second respondent in
this court and in the court a quo, abided the decision of the court
on
both occasions. Roodezandt is the proprietor of the trademark
Robertson Hills, registered in class 33 in respect of alcoholic
beverages,
except beer. Proceedings began when the Winery brought an
application in the North Gauteng High Court for the removal of this
trademark
in terms of s 24 of the Act. The court a quo, Mavundla
J, granted the order sought with costs, but afforded Roodezandt leave
to appeal to this court against his judgment and order.
[2]
Roodezandt’s trademark was filed on 25 February 2008. In terms
of s 29(1) of the Act that is therefore deemed to
be the date of
registration. It is common cause that, for the purpose of deciding
whether or not the entry of that trademark was
wrongly made, we must
look at the factual position prevailing at that date, irrespective of
when the certificate of registration
was issued. As at that date the
Winery was the proprietor of three registered trademarks which
included the name Robertson, all
in class 33 and thus pertaining,
amongst other things, to wine. The first of these was registered in
1997. It is a composite label,
consisting inter alia of the words
‘Robertson Winery’. The second of these marks was
registered in 2002. It consists
of a word mark ‘Robertson
Vineyards’. It is registered subject to the disclaimer that its
registration ‘shall
give no rise to the exclusive use of the
geographical name Robertson where used
bona fide
as an
indication of origin’. The third mark consists of the word
‘Robertsoner’ and was registered in 2004. To
complete the
picture, the Winery is also the registered holder of the trademark
‘William Robertson’ again in class
33. But this was filed
on 1 August 2008, ie five months after the effective date of
Roodezandt’s mark.
[3]
Apart from these registered marks, affidavits tendered by the Winery
testified that it is an award winning winery which had
been producing
and distributing wines under the Robertson Winery label since 1941,
ie 56 years before it applied for the registration
of its first
Robertson mark. By way of example, its wine sales increased from
197 878 cases of 12 x 750ml bottles in 2000,
to 271 694
cases in 2002, to 451 397 cases in 2007 and to 1 068 740
cases in 2010. Annexed to these affidavits
were a whole range of
South African publications showing extensive advertising by the
Winery of its Robertson Winery products.
Moreover, the Winery pointed
out that its wines are the only ones in relation to which the word
Robertson has ever been used in
respect of wine to identify the
producer. Although Roodezandt nominally denied these allegations in
its answering affidavit, these
denials were self-evidently bald and
Roodezandt plainly could proffer no evidence to contradict the
Winery’s contentions
of its acquired reputation in the
‘Robertson Winery’ mark.
[4]
As to the relevant legal principles, it appears to be well
established that an application for rectification in terms of s 24
under the rubric ‘an entry wrongly made’ can rely on any
of the grounds on which opposition to registration could have
been
made (see eg Webster and Page
South African Law of Trademarks
4
ed para 13.16.1). These include the negative attributes which would
render a trademark unregisterable in terms of s 10 of
the Act.
With reference to the grounds contemplated in s 10, the Winery
initially relied upon a number of sub-sections, but
in argument
before us, confined itself to sub-section 10(12) and 10(14). What
these two sub-sections have in common is that they
proscribe the
registration of a mark which would be likely to deceive or cause
confusion, either in general or with reference to
another registered
mark. Hence it was common cause in argument before us that, whichever
of these sub-sections were relied upon,
the outcome of the appeal
hinges on a comparison of Roodezandt’s trademark with the marks
relied upon by the Winery for similarity,
so as to establish whether
the former is likely to deceive or cause confusion. ‘Deception’
will result, so it has been
held, when the similarity were to cause
members of the purchasing public to assume that the goods bearing the
two competing trademarks
come from the same source. ‘Confusion’,
on the other hand, would occur if these members of the public will be
caused
to wonder if the goods had a common origin (see eg
Oude
Meester Groep Bpk v SA Breweries Ltd; SA Breweries Ltd v Distillers
Corporation (SA) Ltd
1973 (4) SA 145
(W) at 160H).
[5]
The fundamental enquiry is therefore whether Roodezandt’s
Robertson Hills mark so resembles the Winery’s marks
incorporating the term ‘Robertson’ that, if the competing
marks are all used in relation to wine, such use would be
likely to
cause deception or confusion. That determination involves a value
judgment (see eg
Cowbell AG v ICS Holdings Ltd
2001 (3) SA 941
(SCA) para 10). Considerations that could assist in the exercise of
this value judgment have been proposed in numerous decided
cases. One
of these cases is
Laboratoire Lachartre SA v Armour-Dial
Incorporated
1976 (2) SA 744
(T) in which Colman J sounded the
following note of caution (at 746B-E):
‘
We
have had ample time for full consideration and close comparison of
the two trademarks with which we are concerned. These advantages,
however, carry their own dangers. They have caused us to look at the
trademarks with far greater care than they would be looked
at by the
members of the public whose probable reactions we are required to
assess, and with a far keener awareness of similarities
and
dissimilarities than such people would probably have as they go about
their daily lives.
What
we have now to do is, therefore, to transport ourselves, notionally,
from the court-room or the study, to the market place.
We must try to
look at the marks as they will be seen, if they are both in fair and
normal commercial use, by the hypothetical
consumers of [wine]. Those
will be people of many races and degrees of education, having varied
gifts, interests and talents. We
are not to postulate the consumer of
“phenomenal ignorance or extraordinarily defective
intelligence”. . . We
are to consider a person of average
intelligence and proper eyesight, buying with ordinary caution.’
[6]
Most, if not all, of these considerations seem to find application in
the present context. Other principles of comparison which
have become
crystallised in earlier decisions of this court which I find to be
pertinent, include the following:
(a)
A likelihood of confusion does not only arise when every person
interested or concerned in the class of goods for which the
trademark
has been registered could probably be deceived or confused. It also
arises if the probabilities establish that a substantial
number of
such persons will be deceived or confused.
(b)
The concept of deception or confusion is not limited to inducing in
the minds of these interested persons the erroneous belief
or
impression that the two competing products are those of the objector
or that there is a connection between these two products.
A
likelihood of confusion is also established when it is shown that a
substantial number of persons will probably be confused as
to the
origin of the products or the existence or non-existence of such a
connection.
(c)
The determination of the likelihood of confusion involves a
comparison between the two competing marks, having regard to the
similarities and differences in the two and an assessment of the
impact it would have on the average type of customer who is likely
to
purchase the kind of goods to which the marks are applied.
(d)
The marks must not only be considered side by side, but also
separately.
(e)
It must be borne in mind that the ordinary purchaser may encounter
goods bearing one mark with an imperfect recollection of
the other.
(f)
If each of the competing marks contains a main or dominant feature or
idea, the likely impact made by this dominating feature
on the mind
of the customer must be taken into account. This is so because marks
are remembered by some significant or striking
feature rather than by
the photographic recollection of the whole. (See eg
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984 (3) SA 623
(A) at
640G-641E;
Puma AG Rudolf Dassler Sport v Global Warming (Pty) Ltd
2010 (2) SA 600
(SCA) para 8; and
Adidas AG & another v
Pepkor Retail Ltd
2013 BIP 203 (SCA) paras 20-23.)
[7]
Roodezandt’s trademark, Robertson Hills, is clearly not
identical to either Robertson Winery or Robertson Vineyards. Yet
all
these marks contain a common element, the term Robertson. Moreover,
it is clear to me that this common element at the same
time
constitutes the dominant component of all three. After all, the
suffix, ‘Hills’ in itself seems to be as non-distinctive
as ‘Winery’ and ‘Vineyards’. On the face of
it and having regard to the crystallised principles of comparison
to
which I have referred, Roodezandt’s mark therefore seems to
create the likelihood of deception or confusion.
[8]
But, Roodezandt argued, Robertson is not a constructed or invented
word finding distinctiveness in itself. It is the name of
a town, and
also the name of a defined production area in terms of s 11(3)
(a)
of the
Liquor Products Act 60 of 1989
. In this light, so
Roodezandt contended, it was not open to the Winery to arrogate for
itself the exclusive use of an ordinary
geographical term ‘Robertson’
in the trademark sense.
[9]
The answer to this line of argument, so it seems to me, is that
although Robertson is not a constructed or invented word, but
the
name of a town, this does not necessarily mean that it could never
acquire distinctiveness with reference to wine. The example
that
comes to mind is the one given by Harms DP in
Century City
Apartments Property Services CC v Century City Property Owners’
Association
2010 (3) SA 1
(SCA) para 33, of Windhoek as
distinctive with reference to beer, albeit that it is also the
capital of Namibia. Where, as in this
case, the name ‘Robertson’
had been used exclusively with reference to the wine of a specific
producer for a period
in excess of 60 years, I can see no reason why
the Windhoek example would not apply. Moreover, what is clear to me,
and in fact
it was conceded, that Roodezandt is not using the word
Robertson in its label ‘Robertson Hills’ with reference
to the
town, but in order to distinguish its wines from others, ie as
a trademark.
[10]
As to the fact that Robertson is the name of a defined production
area for wine in accordance with the wine of origin scheme
(the WO
scheme) which was established in terms of the
Liquor Products Act,
this
court had the opportunity on two occasions to express itself on
the relationship between trademarks, on the one hand, and the WO
scheme on the other. That was in
Groupe LFE (SA) (Pty) Ltd v
Swartland Winery Ltd
(467/09)
[2011] ZASCA 4
(4 March 2011) and
in
Mettenheimer v Zonquasdrift Vineyards
2014 (2) SA 204
(SCA). In
Mettenheimer
the following is said (in paras 19 and
20):
‘
According
to well-established principle, a trademark serves as a badge of
origin, in the sense that it identifies and guarantees
the trade
origin of the goods to which it applies . . . But in the wine
industry a trademark in respect of wine serves to guarantee
the
origin of the wine only. The badge of origin in respect of the grapes
from which that wine is made is provided by the wine
of origin scheme
(WO scheme).’
And:
‘
The
WO scheme is governed by regulations promulgated . . . in terms of
s 14
of the
Liquor Products Act 60 of 1989
. It emanates from the
recognition in the wine industry that the “terroir” or
area where the grapes are grown has a
significant bearing on the wine
made from these grapes.’
[11]
In
Groupe LFE
the word ‘Swartland’ formed part of
the respondent’s registered trademark. It is also the name of a
production
area under the WO scheme. The appellant then used the word
Swartland on its wine label to indicate that it was a wine of origin
produced in the Swartland geographical area, as it was entitled to do
in terms of the WO scheme. But, so this court held, on the
facts of
that case, the appellant also used the word Swartland as a trademark
which constituted an infringement of the respondent’s
mark
which, of course, it was not entitled to do. As I see it the facts of
the present case
a fortiori
lead to a similar conclusion.
Roodezandt does not even suggest that its Robertson Hills wines are
produced as wines of origin in
the Robertson geographical area. It
uses the name Robertson exclusively as a badge of origin of the
producer. And, because the
Winery is doing the same, there is a
likelihood of deception and confusion.
[12]
In all the circumstances I therefore agree with the finding by the
court a quo that the Winery had succeeded in establishing
the
likelihood of confusion and deception of Roodezandt’s trademark
Robertson Hills with its marks containing the component
Robertson.
Hence I also agree that the Registrar of Trademarks should be ordered
to rectify the register forthwith by the removal
of Roodezandt’s
trademark ‘Robertson Hills’ in class 33.
[13]
The court a quo also ordered that the removal of Roodezandt’s
trademark is ‘deemed to be with effect from the date
of entry
of the relevant registration’. Roodezandt contended, however,
that there is no basis for making the order retrospective
to that
date. At best, so the argument went, the order could be effective as
from the date of the application for removal of the
trademark. Until
such time as the order had been granted, so the argument went, the
trademark remained validly registered. There
appears to be no
authority on this aspect. The Winery’s counter argument was
that in view of a finding that the trademark
should never have been
registered by virtue of
s 10
, the removal with retrospective
effect from the outset is warranted.
[14]
Although I see the logic in the Winery’s counter argument, I
believe it may lead to consequences which could be substantially
unfair. In this case it does not seem to matter because, as I
understand it, Roodezandt had not yet used its registered mark. But
what about the proprietor who had used its mark for a lengthy period
prior to its removal under
s 24?
I find an analogy in what has
become known in administrative law parlance as the Oudekraal
principle (after the decision of this
court in
Oudekraal Estates
(Pty) Ltd v Cape Town & others
2004 (6) 222 (SCA) para 31 in
which it had first been established). In essence, this principle
dictates that, since administrative
decisions are often acted upon on
the supposition that they were validly taken, they are accepted as
valid, until challenged and
set aside by a competent court. Whether
or not the particular decision was indeed valid is of no consequence.
Until challenged
and set aside, its validity is accepted as a fact
(see also eg
Camps Bay Ratepayers’ and Residents’
Association v Harrison
2011 (4) SA 42
(CC) para 62). When applied
to the removal of a trademark in terms of s 24 of the Act, the
retrospective effect of that rectification
can go no further than the
time that its validity was formally challenged, which is the date of
the application for its removal.
[15]
For these reasons:
(a)
The appeal is dismissed with costs.
(b)
Save for the amendment in para (c), the order of the high court is
confirmed.
(c)
Paragraph 2 of the high court’s order is amended to read as
follows:
‘
That
the removal of the registration is made in terms of s 24 of the
Trademarks Act and deemed to be with effect from the date
of
application for its removal on 19 January 2012.’
_________________
F
D J BRAND
JUDGE
OF APPEAL
APPEARANCES:
For
the Appellant: R Michau SC
Instructed
by:
Dyason
Inc
Pretoria
c/o
McIntyre & Van der Post
Bloemfontein
For
the Respondent: A J Bester SC
Instructed
by:
Ron
Wheeldon Attorneys
Johannesburg
c/o
Phatshoane Henney
Bloemfontein