First National Bank of Southern Africa Ltd v Barclays Bank Plc and Another (118/02) [2003] ZASCA 12; [2003] 2 All SA 1 (SCA) (14 March 2003)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2003
>>
[2003] ZASCA 12
|

|

First National Bank of Southern Africa Ltd v Barclays Bank Plc and Another (118/02) [2003] ZASCA 12; [2003] 2 All SA 1 (SCA); 2003 (4) SA 337 (SCA); 2003 BIP 72 (SCA) (14 March 2003)

Reportable
Case No 118/02
In
the matter between:
FIRST NATIONAL BANK OF SOUTHERN
AFRICA Appellant
LTD
and
BARCLAYS
BANK PLC 1
st
Respondent
THE
REGISTRAR OF TRADE MARKS 2
nd
Respondent
Coram: HARMS, ZULMAN, CONRADIE JJA and JONES & SHONGWE AJJA
Heard: 28 FEBRUARY 2003
Delivered: 14 MARCH 2003
Subject: Trade Marks Act 62 of 1963 – application for registration
of ‘Premier’ and ‘Premier Package’ – laudatory marks
–
reasonably required for use in the trade
JUDGMENT
HARMS JA/
HARMS JA:
[1] This appeal concerns applications by the appellant, First
National Bank of Southern Africa Ltd (‘FNB’), for the
registration
of the trade marks ‘Premier’ and ‘Premier Package’
in relation to cheques and banking and credit card services. The
respondent
(‘Barclays’), a British bank, opposed the
applications. Eloff J, who had been appointed in terms of
s 6(3)
of
the
Trade Marks Act 194 of 1993
to perform the function of the
Registrar to decide opposition proceedings, refused the applications
for registration. An appeal
to the Full Court
1
was dismissed and the present appeal is an appeal of right.
2
[2] The applications for registration predate the commencement of the
1993 Act and have to be disposed of under the provisions of
the
repealed Trade Marks Act 62 of 1963.
3
All further references in this judgment to ‘the Act’ will thus
be references to the 1963 Act.
[3] We have been informed that, whilst the appeal was pending, FNB
applied to and obtained from the Registrar amendments to the scope
of
the goods and services to its applications. What those amounted to,
we were not told. It is difficult to see on what basis the
Registrar
could have amended the applications whilst they were subject of an
appeal. Rights of parties are usually frozen upon
litis
contestatio
. Since it was not argued it is not necessary to
decide whether the procedure was valid; nevertheless, its propriety
has to be questioned.
[4] It serves no purpose to give the detail of the applications in
their original form because we have been requested to deal with
them
on a more restricted basis. FNB wishes this Court to uphold the
appeal and order the Registrar to register the following trade
marks,
4
all applied for on 29 March 1995:
(a) ‘Premier Package’ in part B of the register, in class 36: in
relation to banking and credit card services (B95/3928).
(b) ‘Premier’ in part A, in class 16 in relation to cheques
(95/3931); in class 36 in relation to banking and credit card
services
(95/3932); and, in class 42, in relation to marketing and
merchandising services in relation to banking and credit cards
(95/3933).
In the alternative, the submission was that these
applications should be allowed in part B.
[5] FNB, originally known as Barclays National Bank, has historically
close links with Barclays. These were severed during the period
of
disinvestment during the 1980’s. Barclays National Bank at the
time owned registered trade marks in classes 16 and 36 for ‘Barclays
Premier Card’ and, in translation, ‘Barclays Premier Kaart’.
These it undertook to assign to Barclays or instead at its own
option
cancel them. Barclays, in turn, was the proprietor of a registered
trade mark ‘Premier Barclays Cheque’ but whether it
was a word or
a device mark, the papers do not state. In any event, FNB somewhat
later sought to register a device mark consisting
of the words
‘Premier Cheque’, which the Registrar thought was too close for
comfort to the ‘Premier Barclays Cheque’ mark.
Confronted by the
fact that its mark was vulnerable due to non-use, Barclays consented
to the cancellation of this registration
and FNB exercised its option
of cancelling the ‘Barclays Premier Card’ trade marks.
[6] These otherwise irrelevant facts have been recited in order to
dispose summarily of a point first raised on appeal by FNB, namely
that Barclays is estopped, in the light of them, to oppose FNB’s
applications for registration of the marks now under consideration.

Apart from the requirement that estoppel must be raised in pleadings
or application papers, something FNB did not do, the representation
relied upon was at best that Barclays believed that the device mark
was a valid trade mark. That representation has nothing to do
with
the validity of the word mark ‘Premier’. Even if Barclays
represented to FNB at the time that it thought that the word mark
would be registrable, there is no indication that FNB applied for
registration because of the representation. In other words, FNB
did
not act to its detriment in reliance upon the representation. There
is another point and that is whether estoppel could at all
be invoked
where the purity of the register or public interest is involved, a
point to which scant attention was given and which
should not be
decided in the absence of full argument.
5
[7] Barclays based its opposition to the registration of the marks in
issue on three grounds, namely that the word ‘Premier’
is
laudatory and descriptive; that it is not ‘distinctive’ within
the meaning of s 10 (1) and 12; and that the mark is reasonably
required for use in the trade (s10 (1A)). The mark is said to be
laudatory because the word ‘premier’, a corruption of the Latin
‘primarius’ blamed on the French, in its adjectival sense means
(if I may be forgiven for stating the obvious) ‘best or most
important’, ‘first in importance, size or quality’.
6
[8] The Act
provides for registration of trade marks in either part A (s 10) or
part B (s 11) of the register. In order to qualify
for registration
in part A, the trade mark must contain or consist of a distinctive
mark, meaning that it must be distinctive at
the date of application.
For registration in part B, the requirement is that the mark is
capable,
through use
, of becoming registrable in part A,
meaning that it must be capable of becoming, through use,
distinctive. ‘Distinctive’ is
defined to mean –
‘
adapted,
in relation to the goods or services . . . to distinguish goods or
services with which the proprietor . . . is or may be
connected in
the course of trade . . . from goods or services in the case of which
no such connection subsists . . . .’
(S 12(1)).
In determining whether a trade mark is distinctive in this sense,
regard may be had to the extent to which it is inherently
adapted to
distinguish as well as to the extent to which, by reason of use or
any other circumstance, it is or has become adapted
to distinguish (s
12(2)).
[9] Nothing
in the Act prohibits the registration of ‘laudatory epithets’ but
since Cozens-Hardy MR (
In the matter of an Application by Joseph
Crosfield and Sons Ld
)
7
famously derided –
‘
[w]ealthy
traders [who] are habitually eager to enclose part of the great
common English language and to exclude the general public
of the
present day and of the future from access to the enclosure’
and held
that –
‘
an
ordinary laudatory epithet ought to be open to the world, and is not,
in my opinion, capable of being registered’,
what at
best may be a rule of thumb is regarded by some as a rule of law.
One can rightly question whether this is not a –
‘
further
instance in this context of wrongly elevating into a general
proposition of law observations made by judges in their application
of the law to the facts of the cases before them.’
8
The
suggestion that the registration of a trade mark excludes the public
from using it is in any event hyperbolic.
[10] Intellectual
property laws and principles are not locked in a time capsule or a
straightjacket and judicial expositions should
be read in context.
What was the Master of the Rolls dealing with? It was an application
for the registration of the trade mark
‘Perfection’ for soap. In
England
9
at the time a trade mark had to contain or consist of certain
essentials, for instance, it had to be an invented word or otherwise
a word having no direct reference to the character or quality of the
goods and not, according to its ordinary signification, a
geographical
name or a surname. If it was, for instance, not
invented or had a direct reference to the character or quality of the
goods, even
though it was distinctive, it could not be registered
unless the Board of Trade or a court, in the exercise of a
discretion, allowed
the application to proceed. Counsel in that case
conceded that the mark had a direct reference to the quality of the
goods. In
order to establish that the mark was distinctive, reliance
consequently had to be placed on extensive use of the mark. The
Court
found that the mark had not been used as a trade mark but only
as an adjective
10
in either ‘Perfection Soap’ or ‘Crosfield’s Perfection Soap’.
Against that background and finding that the word had not
acquired
distinctiveness through use the Court, in the exercise of its
discretion, refused to permit the application for registration
to
proceed.
[11] The
true scope and effect of the judgment was fully perceived by as early
as 1927. In
Joshua Gibson Ltd v Bacon
,
11
a case decided under the then existing South African
12
equivalent of the mentioned English provision, the Court found that
laudatory and for that matter other descriptive words can, by
use,
acquire distinctiveness, albeit that it may be difficult to prove.
13
Epithets, laudatory or otherwise, are by definition adjectives
because they are descriptive and a trade mark, at least a word mark,
is as a general rule not an adjective.
14
It is the name given by a particular concern to its goods or
services. That does not mean that it cannot be used adjectivally.

The point is rather this. Take the word ‘Perfect’ for soap: how
does one distinguish between ‘perfect soap’ and ‘Perfect
soap’?
But ‘Perfection’ does not cause the same problem: there is no
need to distinguish between ‘perfection soap’ and
‘Perfection
soap’ and consequently ‘Perfection’ can be a perfectly good
trade mark.
[12] It is
probably because of an underlying unease about the ‘doctrine’ of
laudatory epithets that most cases that refer to the
Cozens-Hardy
dictum were eventually decided under s 10(1)(a) or a similar
provision, namely that it was a ‘mark which is reasonably
required
for use in the trade’.
15
There is an absolute prohibition against registering such a mark.
The fact that under the 1993 Act use of a mark for certain
descriptive
purposes
16
may provide a defence against infringement does not affect the
prohibition.
[13] After
that perambulation I turn to the first stage of the inquiry: Was the
mark ‘Premier’ inherently distinctive as at the
date of
application, entitling it to registration in part A of the register?
I think not and I did not understand FNB to argue otherwise.
In
‘premier cheque account’, ‘premier credit card service’ or
‘premier banking service’ the intended trade mark performs
a
purely descriptive or adjectival function. As I understand FNB’s
evidence, that is primarily how it used or intends to use it.
This
appears from the evidence of Mr Unser who stated that:
‘
By virtue of the definition of PREMIER, particularly
in its adjectival form, the abovementioned facts relating to the use
and distinctiveness
of the Applicant’s FIRST trade mark has
relevance.’
Trollip JA,
in dealing with the mark Meester in
Distillers Corporation (SA)
Ltd v SA Breweries Ltd and Another; Oude Meester Groep Bpk and
Another v SA Breweries Ltd
,
17
said this:
‘
Now Meester is not a coined or invented word,
inherently adapted to distinguish the goods to which it relates. It
is, like its English
equivalent, Master, an ordinary, well known word
to be found in any dictionary. As a noun it ordinarily connotes a
superior person
of knowledge, experience, competence, skill, or
authority; therefore, when used in a trade mark in relation to goods,
normally it
impliedly lauds the quality of those goods. The same
commendation is usually conveyed when it is used adjectivally of a
person; and
when so used of a thing, that the thing is made by a
“master”. It is understandable, therefore, that the word is often
used as
part of a trade mark. Evidence was adduced for Breweries
indicating that some 50 trade marks on the register contain Master or
Meester
as part of the mark, in many cases the right to the exclusive
use of the word being disclaimed. In
International Harvester
Company's Application
,
(1953) 70 R.P.C. 141
, the hearing officer,
in giving judgment, mentioned that “in the past few years” the
Register in England had received some 300
applications for
registering compound words as trade marks which terminated in
“master”. All the above information (which is
admissible for the
present enquiry ─ see
Coca-Cola Co. of Canada Ltd. v Pepsi-Cola
Co. of Canada Ltd.,
59 R.P.C. 127
(P.C.) at p. 1331. 28-51) shows
that, not only in popular parlance, but in trade parlance too,
Meester is an ordinary, well known,
laudatory word, not inherently
distinctive or characteristic of the goods in respect of which it is
used.’
What he
said applies to the facts of this case.
[14] The
second stage of the inquiry requires a determination of the question
whether, at the date of application, the mark had become
distinctive
because of prior use. If the answer is in the affirmative, FNB is
entitled to registration in part A. In this regard
FNB principally
relied upon two pieces of evidence. (Before us the evidence of Prof
Hughes, an expert in semantics was not relied
upon.) The first is
that of Mr John Bryant, a director of Standard Bank of SA Ltd. The
affidavit, sworn some five years after the
application date, is of no
value to FNB, not only because it does not deal with the situation as
at the relevant date – on the
contrary, it is couched in the
present tense – but also because it says nothing of any moment. He
says that he ‘is aware’
of the brand name ‘Premier’; he
‘understands’ that it is used by FNB in respect of credit card
and cheque account facilities
offered by FNB; he ‘believes’ that
the brand name is to the best of his ‘knowledge and belief’ well
known in the banking
industry; he associates it exclusively with FNB;
and to the best of his ‘knowledge and belief’ so does Standard
Bank. One has
to concur with the Full Court that this hardly
qualifies as a statement of fact. In addition, Bryant kept mum about
‘Premier Package’;
he says nothing of the goods mark, limiting
himself to the service mark; and he fails to make allowance for the
fact that exclusive
use by one bank of a mark does not make that mark
distinctive in the trade mark sense.
[15] The
next bit of evidence gives us the number of Premier cheque account
and credit card accounts held by customers and the debit
or credit
amounts reflected in them and also some advertising material. This
evidence appears to deal with the current position
and does not
purport to deal with the position at the relevant date. The
evidence, likewise, is of little moment.
18
The mark, as far as I can see, was used mostly, if not invariably,
in connection with FNB’s obvious trade marks and as an adjective.

It was also used to distinguish FNB’s services one from the other:
prime clients get the premier product; others do not. It
is worth
quoting Jacob J in
British Sugar PLC v James Robertson & Sons
Ltd
19
(the Treat case):
‘
I have already described the evidence used to support
the original registration. It was really no more than evidence of
use. Now
it is all too easy to be beguiled by such evidence. There
is an unspoken and illogical assumption that “use equals
distinctiveness”.
The illogicality can be seen from an example:
no matter how much use a manufacturer made of the word “Soap” as
a purported
trade mark for soap the word would not be distinctive of
his goods. He could use fancy lettering as much as he liked,
whatever he
did would not turn the word into a trade mark. Again, a
manufacturer may coin a new word for a new product and be able to
show massive
use by him and him alone of that word for the product.
Nonetheless the word is apt to be the name of the product, not a
trade mark.
Examples from old well-known cases of this sort of thing
abound. The
Shredded Wheat
saga is a good example: the
Canadian case is
The Canadian Shredded Wheat Co Ltd v Kellogg Co
of Canada Ltd
in the Privy Council and the United Kingdom case
The Shredded Wheat Co Ltd v Kellogg Co of Great Britain Ltd
in
the House of Lords. In the former case Lord Russell said.
“
A word or words to be really distinctive of a
person’s goods must generally speaking be incapable of application
to the goods of
anyone else.”
It
is precisely because a common laudatory word is naturally capable of
application to the goods of any trader that one must be careful
before concluding that merely its use, however substantial, has
displaced its common meaning and has come to denote the mark of a
particular trader. This is all the more so when the mark has been
used in conjunction with what is obviously taken as a trade mark.’
[16] The
conclusion that FNB is not entitled to registration in part A brings
one to the next inquiry, namely whether it is entitled
to
registration in part B, which, as mentioned, requires a value
judgment as to whether the word ‘Premier’ in the context of
cheques, banking services and the like, can through use become
distinctive.
20
The Courts below did not deal with this aspect in so many terms but
it appears that they thought not and that they were influenced
in
their thinking by the following quotation from
The Premier Motor
Company (Birmingham) Ltd v Premier Driving School (Birmingham) Ltd
:
21
‘
The
word “Premier” which each of the companies concerned in this case
bears as part of its name is a quite ordinary word in very
common
use, as is disclosed, if evidence were necessary, by the fact that in
a page in the local telephone directory to which I was
referred there
are something like fifteen to twenty different concerns the first
word of whose style is PREMIER. Of course, it is
a perfectly
ordinary English adjective to apply to any business and it is, I
suppose, synonymous with the word “leading”, the
leading motor
company of Birmingham and the leading driving school of Birmingham ─
that is the connotation of the word “premier”.
’
It was a
passing-off case and the decision was an interlocutory one. The
question was whether the names Premier Motor Company (Birmingham)
Ltd
and Premier Driving School (Birmingham) Ltd were confusingly similar.
This dictum can therefore hardly be dispositive of the
issue
presently under consideration.
[17] The
correct approach is that of the Court of Appeal in
Premier Luggage
and Bags Ltd v The Premier Co (UK) Ltd
.
22
It concerned the trade mark ‘Premier’ used in relation to
luggage. The mark had been used extensively as a trade mark.
‘
I reject the submission, made on behalf of Premier UK
in this Court, that the word “Premier” is incapable of being or
becoming
distinctive of origin. In particular, I do not accept that
the word “Premier”, although plainly capable of being used in a
descriptive
or adjectival sense (denoting primacy or superiority over
other members of the class) and so (absent use) devoid of any
inherent
distinctive character, cannot become distinctive of origin
as a result of use in relation to particular goods or services.
“Premier”
is not a word like “soap” which can only describe
the article to which it is applied ─ see the observations of Mr
Justice Jacob
in the
British Sugar
case (
British Sugar Plc
v James Robertson & Sons Ltd
[1996] RPC 281)
at pages 302 and
305 to which the judge referred. Nor is it a word which, although
once capable of being distinctive, has become
solely descriptive
through use ─ see the examples given in the
Bach
case (
Bach
and Bach Flower Remedies Trade Marks
[2000] RPC 513)
at paragraph
34 (at page526).’
[18] FNB,
consequently, was entitled to a part B registration unless hit by the
prohibition contained in s 10(1A), namely that the
mark is reasonably
required for use in the trade. Counsel submits that without evidence
this ground of objection has to fail. That
appears to be an
overstatement. A court has to make a value judgment and although
evidence may in a particular case be useful, it
can never be a
sine
qua non
or conclusive. In order to answer the question another
question can usefully be posed: Would it be reasonable if another
bank (say
Standard Bank since its name came up in the evidence)
should wish to call its premier financial product ‘Standard Bank
premier
cheque account’ or even its ‘premier financial product’?
Confusion with FNB’s premier cheque account does not seem probable
but, as counsel accepted, if ‘Premier’ is registered, Standard’s
use could be infringing.
23
The fact that no other bank has a present intention of using the
word Premier does not seem to be of any real relevance. The question
surely must be an objective one with the emphasis on ‘reasonable’.
[19] Webster
and Page
24
submit, correctly it seems, that the exclusion of marks reasonably
required for use in the trade affords adequate protection without
applying the more elaborate tests that bar registration under the
1938 British Trade Marks Act and, by implication, our 1916 Act.

Blessed with the advantage of hindsight one may indeed question the
correctness of some of the older decisions on this issue. For
instance, do manufacturers of polish really require the word Marvel
in their trade (as was the judgment in
Joshua Gibson
)? I
think not. Having said this and seeking little guidance in cases
that appear to have overstepped the mark, I am satisfied that
the
marks sought to be registered are indeed hit by s 10(1A).
[20] The
appeal is dismissed with costs, including those consequent upon the
employment of two counsel.
_______________________
L T C HARMS
JUDGE OF APPEAL
Agree:
ZULMAN
JA
CONRADIE
JA
JONES
AJA
SHONGWE
AJA
1
Spoelstra J, Daniels and van der Westhuizen JJ concurring
2
Cowbell AG v ICS Holdings Ltd
2001 (3) SA 941 (SCA);
[2001] 4 All SA 242
(A) para 5.
3
Trade Marks Act 194 of 1993
s 3(2)
provides that ‘‘[a]ll
applications and proceedings commenced under the repealed Act shall
be dealt with in accordance with
the provisions of that Act as if it
had not been repealed.’’
4
FNB did not pursue on appeal the refusal of the registration of
Premier in class 9 (95/3930).
5
Cf
Trust Bank van Afrika Bpk v Eksteen
1964 (3)
SA 402
(A) at 411H–412B;
Provincial Government of the Eastern
Cape and others v Contractprops 25 (Pty) Ltd
[2001] 4 All SA 273
(A); 2001 (4) SA 142 (SCA) at para 11.
6
Encarta World English Dictionary.
7
1909 RPC 837
at 854-856.
8
Gerber Foods International Ltd v Gerber Products Co
[2002]
EWCA Civ 1888
(CA) para 31 per Auld LJ. To be found at
www.bailii.org/ew/cases/EWCA/Civ
.
9
Trade Marks Act 1905 (5 Edw VII c 15) s 9.
10
At 855 line 40.
11
1927 TPD 207
per Tindall J, Curlewis JP concurring.
12
Patents, Designs, Trade Marks and Copyright Act 9 of 1916 s 99. The
British act was replaced in 1938 by a new Trade Marks Act
(1 & 2
Geo VI c 22), which also contained limitations relating to the
registration of a word having a direct reference to the
character or
quality of the goods or being in its ordinary signification a
geographical name. Our 1963 Act did not contain these
limitations:
Webster and Page
South African Law of Trade Marks
para 3.28.
13
At 216
in fine
.
14
This conflicts with something I said previously in
Cadbury (Pty)
Ltd v Beacon Sweets and Chocolates (Pty) Ltd and Another
[2000] ZASCA 2
;
2000
(2) SA 771
(SCA) at para 8: ‘During argument, counsel were unable
to suggest an alternative name for the product. If one considers
that
a trade mark performs an adjectival function in relation to
goods or services, the fact that another noun for the product is not
readily apparent is a fair indication that the term does not perform
any function.’ The second sentence does not make sense as
it
stands since it contains a contradiction and should read: ‘If one
considers that a trade mark does not perform an adjectival
function
in relation to goods or services, the fact that another noun for the
product is not readily apparent is a fair indication
that the term
does not perform any function.’
15
E g
ITT Continental Baking Co v Registrar of Trade Marks
1980
(2) SA 127
(T) at 129H where the ‘rule’ concerning the
non-registrability of laudatory epithets was regarded as an example
of the prohibition
contained in s 10(1A). (Per McEwan J, Nestadt J
concurring.) Also
Pleasure Foods (Pty) Ltd v TMI Foods CC t/a
Mega Burger
2000 (4) SA 181
(T) 189I-J.
16
S 34(2)(a) – (c): ‘A registered trade mark is not infringed by—
(a) any bona fide use by
a person of his own name, the name of his place of business, the
name of any of his predecessors in business,
or the name of any such
predecessor’s place of business;
(b) the use by any
person of any bona fide description or indication of the kind,
quality, quantity, intended purpose, value, geographical
origin or
other characteristics of his goods or services, or the mode or time
of production of the goods or the rendering of the
services;
(c) the bona fide use of
the trade mark in relation to goods or services where it is
reasonable to indicate the intended purpose
of such goods, including
spare parts and accessories, and such services.’
17
1976 (3) SA 514
(A) at 552H-553C.
18
Cadbury (Pty) Ltd v Beacon Sweets and Chocolates (Pty) Ltd and
Another
[2000] ZASCA 2
;
2000 (2) SA 771
(SCA) at para 9.
19
[1996] RPC 281
(ChD) at 302. A reference to this passage can be
found in
Beecham Group PLC and another v Triomed (Pty) Ltd
[2002] 4 All SA 193
(SCA) para 15.
20
I do not deal separately with ‘Premier Package’ because the
package bit adds nothing of consequence.
21
[1962] RPC 222
at 223.
22
[2002] EWCA Civ 387.
To be found at
www.bailii.org/ew/cases/EWCA/Civ.
23
Cf
Standard Bank of SA Ltd v United Bank Ltd and Another
1991
(4) SA 780
(T).
24
Para 3.30.