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[1996] ZASCA 46
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Williams t/a Jenifer Williams & Associates and Another v Life Line Southern Transvaal (495/94) [1996] ZASCA 46; 1996 (3) SA 408 (SCA); (29 March 1996)
Case No 495/94
IN THE SUPREME COURT OF
SOUTH AFRICA
(
APPELLATE DIVISION
)
In the appeal of:
JENIFER MARY WILLIAMS
t/a JENIFER WILLIAMS & ASSOCIATES
First Appellant
PROMENADE CONCERTS CC
Second Appellant
and
LIFE LINE SOUTHERN
TRANSVAAL
Respondent
CORAM
: Corbett CJ, E M Grosskopf, Howie, Marais et
Schutz JJA
DATE OF HEARING
: 4 March 1996
DATE OF JUDGMENT
: 29 March 1996
JUDGMENT
CORBETT CJ
: .
2
CORBETT CJ
:
In the Court a quo (the Witwatersrand Local Division) the
respondent, Life Line Southern Transvaal ("Life Line"), instituted
proceedings on notice of motion against first appellant, Jenifer Mary
Williams, trading as Jenifer Williams & Associates ("Williams"), and
second appellant, Promenade Concerts CC ("Promenade"), alleging
passing-off, unlawful competition and breach of contract, and claiming
certain interdicts. The appellants opposed the application. The matter came before Botha J and Life Line pressed for final orders
without resort to oral evidence. The learned Judge held that the case
based on breach of contract had not been established, but that passing-
off and unlawful competition had; and he accordingly granted a final
interdict in terms which I shall detail later and ordered the appellants
to pay the costs of the application. With the leave of this Court, the
appellants appeal against the judgment and order of the Court a quo
based on passing-off and unlawful competition. There is no cross-
3
appeal and accordingly the issue of breach of contract falls away.
From the founding affidavit deposed to by Felicity Mary
Tindle ("Tindle") it appears that Life Line is a voluntary, non-profit
association, which provides training and counselling services of a welfare nature. It has its principal place of business in
Norwood
,
Johannesburg
. Williams conducts business as a public relations
consultant, promoter and organizer. Promenade is a close corporation
which carries on business as a presenter of orchestral concerts. It was
first incorporated on 13 March 1992 under the name Orchestral Productions. On 3 June 1993 this name was changed to Promenade Concerts.
Williams is its sole member.
The litigation between the parties has its origin in a series
of fund-raising concerts which Williams organized for Life Line in the
period 1991 to 1993 under the name and style, "Last Night of the
Proms". Most of the relevant facts are common cause, but where
they are not, I shall apply the
Plascon-Evans
principles.
4
The name, "Last Night of the Proms", is derived from the
popular and colourful classical concerts which have been performed
in
London
since 1895. They take the form of a series of promenade
concerts played during the English summer in the Royal Albert Hall
and are well-known throughout the western musical world. The last
of these seasonal concerts, which has popularly become known as the
"Last Night of the Proms", is particularly famous. It is one of
Britain
's best known and loved musical events and it draws a capacity
audience each year. It has a traditional programme, with audience
participation. The second half always includes time-honoured
favourites such as Sir Henry Wood's Sea Songs, Rule Britannia,
Jerusalem
and
Land
of
Hope
and Glory. Streamers are thrown and
there is generally a carnival atmosphere. This "Last Night of the
Proms" concert is designed to have more popular appeal than the usual
classical concerts.
A concert with the format of the "Last Night of the
5
Proms" was first performed in
Durban
in 1985 by the Durban City
Orchestra under the baton of Mr Michael Hankinson ("Hankinson").
He not only acted as conductor of the concert but also was
responsible for much of its promotion, publicity and presentation. The
concert was in traditional form, with audience participation and
streamer-throwing in the second half. It was a charity presentation,
the beneficiary being the Hillcrest Round Table. Since then
Hankinson has continued to conduct such concerts in Durban from
time to time and at the time of these proceedings had done so on nine
occasions.
In 1988 Hankinson conducted a "Last Night of the Proms"
concert, in the traditional form in
Cape Town
. This was also a
charity concert, this time in aid of the Wynberg Rotary Club. This
was followed over the years by four other such concerts in that city.
The circumstances which led to Williams organizing a
series of concerts in the style of the "Last Night of the Proms" for Life
6
Line in
Johannesburg
are briefly as follows. Life Line, which is one
of a large number of such organizations (which are all autonomous) throughout the world, and which provides its counselling and other
services free of charge, is financially dependent on donations from the
public and from corporations. At a certain stage it became necessary
for its existing facilities in
Johannesburg
to be renovated and for a
new training centre to be built. In January 1991 it was decided that
funds be raised for these projects. The responsibility for doing this
devolved upon Life Line's fund-raising committee, of which Tindle
was a member.
During February 1991 Tindle met Williams, who
expressed interest in working for Life Line as an organizer of fund-raising activities. Williams had studied music at university and
had
worked in the field of public relations and as a promoter for over 25
years. In the course of this work she had come into contact with
senior decision-makers of a number of large South African
7
corporations. She had also been involved in fund-raising, in concert
promotion and in the activities of several welfare organizations.
Williams was in due course employed by Life Line as a fundraiser,
with the particular responsibility of organizing two "Last Night of the
Proms" concerts to be performed in the
Johannesburg
City Hall
on 21
and 22 March 1992, in order to raise funds for Life Line. A formal contract of service between Life Line and Williams was signed on
4
June 1991. The contract provided that it was deemed to have
commenced on 15 May 1991 and that it was to remain in force until
the expiry of a period of three months after the concerts, i e until 22
June 1992, or for such extended period as the parties might determine
by mutual agreement. Williams's duties under the contract included
the raising of an overall sponsorship; the selling of corporate packages and boxes; the production of the official programme; the
organization of sponsor, corporate and
VIP
entertainment at the City
Hall; the issuing of invitations and complimentary tickets; media
8
publicity; liaison with various persons and bodies, including the
National Orchestra, the conductor and the choirs; and the making of
approaches to large South African corporations for specific donations.
As remuneration for the discharge of her duties Williams was to
receive various specified commissions on sales and donations received. It was in due course arranged that the concerts were to be
performed by the Transvaal Philharmonic Orchestra, with Hankinson
as conductor, and certain choirs. There is some dispute on the papers
as to who first suggested that the concerts take the format associated
with the "Last Night of the Proms" and as to who first approached
Hankinson to act as conductor, but, in my view, nothing turns on this.
The planning and organization of the concerts went ahead.
Nedbank Limited ("Nedbank") agreed to become the main sponsor.
Corporate packages, which included a gala dinner and advertising,
were sold. Various other ancillary functions were arranged. Media
and other publicity was obtained.
9
The concerts were duly held on 21 and 22 March 1992.
They were a great success. About 2800 persons attended them. At
each concert the chairman of Life Line made a speech and Life Line
ladies acted as hostesses at the gala dinner and as ushers at the
concerts. A net profit of approximately R110 000 was realised.
In view of this success and in response to popular demand
Life Line decided to repeat the whole operation in 1993 and to
present, this time, three concerts on 27 and 28 February and 5 March
on the same pattern as those held in 1992. Life Line decided again to employ Williams to undertake the organization of these concerts
and a second written service contract in terms similar to the first one
was entered into on 23 June 1992. The concerts, again sponsored by
Nedbank, were, if anything, more successful than in the previous year
and yielded a net profit of R240 000.
I come now to Life Line's complaints about the conduct
of Williams which have given rise to the present litigation. The first
10
of these is that in July 1992, and unbeknown to Life Line, Williams
applied to the Registrar of Trade Marks to have a trade mark
consisting of the words "Last Night at the Proms" registered in her
name. This occurred despite the fact that Tindle, on behalf of Life
Line, had asked Williams to investigate whether "Last Night of the
Proms" was registrable as a trade mark in the name of Life Line.
According to Tindle Williams reported to her that her (Williams's)
attorney had advised that registration was not possible, but this is
denied by Williams. Subsequently, in October 1992, the Wynberg
Rotary Club, which had organized the concerts in
Cape Town
, also
made application for the registration in its name of the trade mark
"Last Night of the Proms". Thereafter discussions took place between
attorneys representing Life Line and the Wynberg Rotary Club with
a view to achieving the registration of this trade mark in the name of
Life Line in the
Transvaal
and in the name of Wynberg Rotary Club
in the
Cape
, thus giving recognition to the "proprietorship" of the mark
11
of each of these parties. Williams was asked to withdraw her
application, but, it would seem, did not do so. Indeed in April 1993
she obtained from Hankinson a written assignment of all his right, title
and interest in the mark "Last Night of the Proms".
Secondly, Tindle alleged that Williams had, without the
knowledge of Life Line, entered into a separate agreement with
Nedbank to supervise and promote productions of "Last Night of the
Proms" concerts in
Durban
and
Cape Town
. These were to be
sponsored by Nedbank, which would pay her for her work. This was
said to have "emerged" at a meeting in the offices of Nedbank held on
30 November 1992. Williams admitted the agreement with Nedbank,
but pointed out that Life Line had been aware of it since June 1992.
At the time of the meeting of 30 November 1992 the concerts had
already taken place.
The third complaint relates to a postcard which Williams caused to be inserted in the programme for the 1992 concerts, without
12
Life Line's knowledge or permission. The postcard in question
(annexure "O" to the founding affidavit) invites the concert-goer, in
order to ensure his or her "early notification" of booking for the "1993
PROMS", to complete the card (with name and address, number of
tickets required, etc) and to mail it to Orchestral Productions CC at
a named address. Life Line cited this as evidence of an intention on
the part of Williams "to wrongfully take the goodwill acquired by Life
Line for herself". Williams, in her answering affidavit, denied the
existence of any such goodwill, admitted the insertion of the postcard,
but claimed that this was done in good faith and with a view to
enlarging the mailing list for any future productions of "Last Night of
the Proms".
I come now to the fourth complaint. In about mid-1993
Life Line began to suspect that Williams might attempt to arrange
concerts under the name "Last Night of the Proms" independently of
Life Line. These suspicions were confirmed when advertisements
13
appeared in the Star newspaper from 10 to 13 August 1993
announcing that concerts, described as "The Original Last Night of the
Proms", would be presented by Promenade, with the Transvaal
Philharmonic Orchestra conducted by Hankinson, for the benefit of an Orchestral Trust for South African Musicians in the Benoni City
Hall
on 6 and 7 November 1993 and in the Johannesburg City Hall on 25,
26 and 27 February 1994. Subsequently similar advertisements
relating to the Benoni concerts appeared. Life Line itself placed an
advertisement in the Star newspaper, publicising "Life Line's Last
Night of the Proms" to be presented in the Johannesburg City Hall on
18, 19 and 20 February 1994 by the National Symphony Orchestra
conducted by Mr Richard Cock. The advertisement speaks of this as
the "Official" Last Night of the Proms. It is not clear whether this
preceded, or succeeded, the August advertisements placed by Williams.
At about the same time Williams sent letters, all in similar
terms, to a number of persons who had supported Life Line's 1992
14
concerts. The relevant portions of a sample letter (annexure "U" to
the founding affidavit) read as follows:
"I am writing to clarify the situation of the LAST NIGHT
OF THE PROMS concerts which will take place in the
Johannesburg
City Hall
on 25, 26 and 27 February 1994.
As you know, Life Line (Southern Transvaal) has been
the beneficiary of the LAST NIGHT OF THE PROMS
concerts conceived in
South Africa
by Michael Hankinson
in 1985 and promoted in
Johannesburg
by me in 1992
and 1993.
In less than two years, Life Line (
Southern Transvaal
) has
received a very substantial amount (over R840,000)
through the promotion of THE LAST NIGHT OF THE
PROMS concerts and a "Life Line Building Fund" which
was also initiated and organised by my company.
In 1994 the LAST NIGHT OF THE PROMS will have a new principal beneficiary - an ORCHESTRAL TRUST
which has been formed to educate and assist musicians on
a nationwide basis, particularly those who are
disadvantaged."
[The letter gives some information relating to the Orchestral Trust and
15
then proceeds.]
"Promenade Concerts cc has already received
confirmation for the 1994 PROMS from over 50% of the
Corporate and Company supporters and block bookings
of more than 1000. This is a specially pleasing mark of
appreciation for all of the team who work so hard to
make this outstanding event successful and thus to raise
revenues for whichever charity is the year's chosen
beneficiary.
THE LAST NIGHT OF THE PROMS concerts, with the
Transvaal Philharmonic Orchestra conducted by Michael
Hankinson, which you supported in 1992 and 1993 will
be presented, as before on the dates mentioned at the
beginning of this letter, in its delightful traditional format
in the way which is now Michael Hankinson's own.
The LAST NIGHT OF THE PROMS boxes will be
auctioned in October 1993 and I would appreciate it if
you would complete the attached form and return it to
Promenade Concerts cc."
The letter is signed by Williams who describes herself as "Last Night
of the Proms Concert Organizer."
16
Upon the basis of these facts it is contended in the
founding affidavit:-
(1)
That Life Line enjoys a reputation in the
Transvaal
in relation
to "Last Night of the Proms" in that this "name or trade mark"
is associated in the minds of the public in this area with Life
Line. In support of this Tindle attached affidavits from five
persons attesting to this alleged reputation.
(2)
That the use of this name or trade mark by any other persons would be likely to deceive and confuse people into believing
that they are dealing with Life Line or that there is an
association between such person and Life Line.
(3)
That as a result of the unauthorized use of this name or trade
mark and advertising by Williams and Promenade many people
have in fact been confused into believing that the concerts
planned and advertised by them under this name or trade mark
(1)
17
are being presented by or are associated with Life Line. In substantiation of this affidavits of five persons who have
experienced confusion in various forms are attached.
(4)
That the conduct of Williams and Promenade is causing
extensive and irreparable harm to Life Line, which has arranged
to present Last Night of the Proms concerts on 18, 19 and 20
February 1994 in the Johannesburg City Hall. Nedbank is
unwilling to sponsor Life Line's concerts while Williams and
Promenade also use "Last Night of the Proms" for their concerts. Corporate supporters are confused; Computicket
refused to sell Life Line's tickets because of present confusion;
and the Mayor of Johannesburg has stated that he cannot give
Life Line active support until the confusion has been resolved.
(5)
That Life Line's goodwill, established by the use of "Last Night
of the Proms", is constantly being eroded by the conduct of
(4)
18
Williams and Promenade.
(6) That accordingly the conduct of Williams and Promenade
constitutes unlawful competition and more particularly an
unlawful act of passing-off.
The appellants' response to these contentions may be
summed up as follows:-
(a) They deny that Life Line has acquired any reputation in the
Transvaal in the name "Last Night of the Proms" and aver that,
if this name is associated with any person or entity, it is with
Hankinson, the originator of the concept in
South Africa
. They
attach a number of affidavits (annexures JMW 16 to JMW 22)
by persons who attended the 1992 and/or 1993 concerts in
Johannesburg
. The deponents to these affidavits all associated
these concerts with that presented annually at the Royal Albert
Hall in
London
and regarded them as being faithful
19
reproductions of the
London
event. Most, if not all of them,
were conscious of the fact that the concerts were sponsored by
Nedbank and promoted by Williams; and the majority knew the
identity of the orchestra and the conductor. Some knew the
identity of the beneficiary of the proceeds of the concerts; others merely knew that it was "a chanty". One deponent said
that his "secondary association" regarding the concert series in
Johannesburg
was with Williams as organizer and promoter.
(b) They deny any likelihood of "relevant confusion" for the
purposes of a cause of action based on passing-off and refer
again to annexures JMW 16 to JMW 22, in which the deponents
refer to the 1994 concerts to be presented by Williams. Some
state that they knew who the beneficiary was to be; others state
they did not. Some deny any confusion between the 1992 and
1993 concerts on the one hand and the 1994 concerts on the
other.
20
(c)
They deny that Life Line has any goodwill in the name "Last Night of the Proms", which is capable of being infringed or
eroded.
(d)
Generally they deny passing off and/or unlawful competition.
They say that what they have done has been done in pursuance
of legitimate business activities.
In finding that the appellants had been guilty of passing-
off the learned Judge a quo found that the organization and
presentation of the 1992 and 1993 concerts by Life Line amounted to
a business undertaking or activity capable of sustaining an action for
passing-off; that the goodwill in the concerts under the name "Last
Night of the Proms" had been acquired by Life Line; that the
appellants' activities, particularly the sending of the letter (annexure
"U"), the advertising relating to the 1994 concerts presented by
Promenade, the choice of name for the concerts and the temporal
proximity of the 1994 concerts arranged by the appellants and those
21
arranged by Life Line, amounted to a misrepresentation and was
calculated to cause confusion; and that accordingly there had been
passing-off.
In further holding that the appellant's conduct amounted
also to unlawful competition, the Judge a quo stated ("first respondent"
being Williams and "the applicant" being Life Line):
"The First Respondent had staged the 1992 and 1993
performances for the Applicant. She knew exactly how
the tickets were marketed. She knew who the persons or
corporations were in respect of which the Applicant's
"werfkrag" would be operative. She engaged the same
conductor and the same orchestra. She booked the
concerts, which are traditionally held in summertime, during the same period when the applicant had had its
concerts. She reserved the same venue. Then she
created the impression that her production was the
continuation of the previous two concerts. Her conduct
amounts to nothing less than the filching of the musical
event that the Applicant had introduced into the
Transvaal
and built up into a promising source of revenue. Judged
by the boni mores and considerations of fair play and
22
honesty I do not think that it is conduct that could be
described as lawful."
The interdict granted by the Court a quo (on 11 February
1994) was in the following terms:
"Interdicting and restraining the Respondents from
committing acts of unlawful competition and passing-off
against the Applicant by using the name or trade mark
LAST NIGHT OF THE PROMS or any other name or
trade mark confusingly similar thereto in relation to
musical productions in the area of the Transvaal
Province"
I shall deal first with the cause of action based upon
passing-off. As my recital of the facts will have shown, this is an
unusual claim of passing-off. Passing-off is a species of wrongful
competition in trade or business. In its classic form it usually consists
in A representing, either expressly or impliedly (but almost invariably
by the latter means), that the goods or services marketed by him
emanate in the course of business from B or that there is an
23
association between such goods or services and the business conducted
by B. Such conduct is treated by the law as being wrongful because
it results, or is calculated to result, in the improper filching of
another's trade and/or in an improper infringement of his goodwill
and/or in causing injury to that other's trade reputation. Such a
representation may be made impliedly by A adopting a trade name or
a get-up or mark for his goods which so resembles B's name or get-up
or mark as to lead the public to be confused or to be deceived into
thinking that A's goods or services emanate from B or that there is the
association between them referred to above. Thus, in order to
succeed in a passing-off action based upon an implied representation
it is generally incumbent upon the plaintiff to establish, inter alia:
firstly, that the name, get-up or mark used by him has become
distinctive of his goods or services, in the sense that the public
associate the name, get-up or mark with the goods or services
marketed by him (this is often referred to as the acquisition of
24
reputation); and, secondly, that the name, get-up or mark used by the defendant is such or is so used as to cause the public to be
confused or deceived in the manner described above. These principles are trite
and require no citation of authority.
In Webster and Page,
South African Law of Trade Marks
.
3 ed, at 414-16, the authors discuss the question as to whether it is
necessary that a plaintiff in a passing-off action should have been
carrying on a trade or business in order to succeed. They appear to
approve authorities which have given a wide meaning to the concept
of "business" in this context, but take the view that there is no warrant
for extending the remedy for passing-off to persons who do not
conduct any commercial activity whatsoever. In the present case I
shall assume, in favour of Life Line, that its activities in regard to the
"Last Night of the Proms" concerts put on by it amounted to the
carrying on of a trade or business in this extended sense.
I proceed to consider whether Life Line has established
25
that it enjoyed reputation in the name "Last Night of the Proms" in
regard to the series of concerts put on by it. The name, "Last Night
of the Proms", is descriptive of a particular type of classical concert
which originated in
London
. Its essential features relate to the type
of music presented (including certain time-honoured musical pieces)
and to the audience participation and carnival atmosphere prevailing
at the concert. This is well-known to concert-goers and music-lovers
and, on the evidence, they would tend to associate the name with this
type of concert, particularly with the one presented annually in
London
. "Last Night of the Proms" concerts have, of course, been
presented in
South Africa
by different bodies: in
Durban
as from 1985
at the instance of the Round table and in
Cape Town
as from 1988 at
the instance of a Rotary Club. In this context Life Line, with its 1992 and 1993 concerts, was a late-comer in the field. Recognising
this, Life Line has sought to place territorial limits (the area of the
Transvaal
Province
) on the interdict claimed by it. I shall further
26
assume in favour of Life Line that this is legally permissible (Cf
Deans Man Shop (Pty) Ltd v Momberg
1975 (1) SA 841
(W), at 842
H).
It seems to me, however, that the principal difficulty
confronting Life Line is that a charity concert of this nature is quite
different from a commodity such as a packet of cigarettes or hotel
accommodation provided by a corporate group or a circus giving
entertainment to the public. In each of these examples there would
normally be a single provenance, both in fact and in the eyes of
members of the consuming public. And any reputation in a trade
name would vest in that provider, whoever he might be. This would
not be so in the case of a chanty concert of the type under
consideration which is the combined product of the chanty (which is
both the initiator and the beneficiary of the proceeds), of the
organizers (in this case Williams and Promenade), of the concert
performers (the orchestra, the choirs and, most importantly, the
27
conductor) and, from the financial point of view, of the main sponsor
(Nedbank). On the evidence and as a matter of common experience, it seems very doubtful whether the ordinary member of the public
would single out the charity, in this case Life Line, as sole provider
of the concert, and in the circumstances I do not see how Life Line can claim reputation in the name "Last Night of the Proms".
In this
connection I have had regard not only to the evidence contained in the
affidavits (annexures JMW 16 to JMW 22), but also the advertising
and pre-concert press publicity in respect of the concerts, the tickets,
the concert programmes and the subsequent reviews. If any
individual person or body emerges prominently from this documentary
evidence, it is Nedbank. For instance, certain pre-concert publicity
in the "Star" newspaper of 7 February 1992 describes the concert as
a "Nedbank presentation"; the tickets for the concerts that year contain the words "Nedbank presents Last Night of
the Proms"; and
the 1992 programme speaks in several places of "Nedbank's Last Night
28
of the Proms" (in a mayoral message, in a message from Nedbank's
managing director and in an article about the Soweto String Quartet).
Similar prominence is given to Nedbank in the 1993 programme.
Considerable prominence is also given in some of this documentary
material to Hankinson, described in one article as "The Man Behind
the Proms".
In my opinion, Life Line failed to establish reputation in
the name "Last Night of the Proms" and for that reason alone the
passing-off claim ought to have failed in the Court a quo. I might
add that I am doubtful whether Life Line established the second leg
of its cause of action, viz that Williams's use of the name "Last Night
of the Proms" for the concerts organized by her in aid of the
Orchestral Trust (I shall call these "the rival concerts") caused, or was
calculated to cause, the public to be confused or deceived, but it is
not necessary to decide this issue.
29
I come now to unlawful competition as a cause of action.
In this regard respondent's counsel advanced in argument the
reasoning which found favour with the Court a quo. This was to the
effect that Williams had used the know-how and information acquired
by her in staging the 1992 and 1993 concerts (on behalf of Life Line)
to organize the rival concerts for another charity, using the same
venue and the same conductor and orchestra; that she had created the
impression that her productions were the continuation of the previous
two concerts; and that this amounted to the filching of the musical
event which Life Line had introduced into the
Transvaal
. It is true
that Williams did use for the rival concerts the model of the "Last
Night of the Proms", including the conductor universally associated in
South Africa
with this type of concert and the orchestra which featured
in the 1992 and 1993 concerts. But this model is not Life Line's
exclusive property; on the contrary it is a model previously used
elsewhere in
South Africa
. Moreover, it is recognized, and indeed
30
emphasized, in the field of the law relating to unlawful competition
that in general business ideas which lack statutory protection may be
imitated. As Van Heerden JA put it in
Taylor & Home (Pty) Ltd v
Dentall (Pty) Ltd
1991 (1) SA 412
(A) at 422 B-D:
"As far as I am aware, it has never been suggested that the exploitation of a market established by a
competitor for a particular product, or type of product, is
in itself a form of unlawful competition. On the
contrary, it appears to be generally accepted that, in the
absence of statutory protection, the published idea or
concept of a trader on which his product is based, may be
freely taken over by a competitor even if the trader has
already through his efforts built up a demand for his
product"
(See also
Payen Components SA Ltd v Bovic CC and Others
[1995] ZASCA 57
;
1995 (4) SA 441
(A), at 453 C - E.) Accordingly the mere use of the "Last
Night of the Proms" format for the rival concerts cannot cause the
conduct of Williams and Promenade to be unlawful competition.
31
It is also true that during her employment by Life Line
in terms of the two service contracts Williams gained information and
know-how in regard to the organization of such concerts. At the
same time it must be remembered that she brought considerable
knowledge and experience in such matters to the job, as well as a web
of contact with the corporate world. There is no suggestion on the
part of Life Line that any information gained during the period of the
service contracts was of a confidential nature; nor can it be said that
the skills that Williams acquired during this period could not be
exploited by her in other similar projects. Had Life Line wished to
prevent this it could no doubt have tried to have inserted a restraint
clause in the service contracts; but it did not do so. (Cf
Meter
Systems Holdings Ltd v Venter
1993 (1) SA 409
(W), at 428 A - 432
D and the authorities there cited.)
It is true that some of the things done by Williams might
cause raised eyebrows in certain quarters, but business competition can
32
be ruthless without being unlawful. Here I have in mind the
attempted registration of the trade mark, but this is peripheral to the
main complaint, which relates to the organization and holding of the
rival concerts. Some play was also made in argument of the postcard
inserted by Williams in the programme for the 1992 concerts. I am
not able to find, on the papers, that this was done in bad faith; and
again it does not appear to have any direct connection with the rival
concerts. Certain aspects of the advertising in connection with the
rival concerts, which might suggest some link with Life Line's 1992
and 1993 concerts, may be somewhat questionable, but the same
advertisement makes it clear that the presenter is Promenade and the
beneficiary the Orchestral Trust.
Taking an overall view of the facts of the matter I am not
persuaded that what the appellants did amounted to unlawful
competition.
33
The appeal is allowed with costs, including the costs of
two counsel, and the order of the Court a quo is altered to read -
"Application dismissed with costs".
M M CORBETT
E M GROSSKOPF JA)
HOWIE
JA) CONCUR
SCHUTZ
JA)
Case No 495/94
IN THE SUPREME COURT OF
SOUTH AFRICA
(APPELLATE DIVISION)
In the appeal of:
JENIFER MARY WILLIAMS
t/a JENIFER WILLIAMS & ASSOCIATES
First Appellant
PROMENADE CONCERTS CC
Second Appellant
and
LIFE LINE SOUTHERN
TRANSVAAL
Respondent
CORAM
:
Corbett CJ, E M Grosskopf, Howie, Marais
ef Schulz JJA
DATE HEARD
: 4 March 1996
DATE DELIVERED
: 29 March 1996
JUDGMENT
MARAIS JA
:
2
MARAIS JA
:
While I agree with a great deal of what is said in the
judgment of the learned Chief Justice, I differ with respect as to the
outcome of the appeal. The points of divergence are these. The Chief
Justice has not found it necessary to decide whether or not Life Line's
fund raising activities entitle it to invoke the remedy which the law
provides against passing-off. I consider that they do. In principle, I
see no good reason why a chanty which resorts to commercial activity
in order to raise funds with which to achieve its principal charitable object should be defenceless against those who participate
in the same
kind of commercial activity and seek to profit by passing off
themselves or the goods or services which they provide as being
connected with the charity. The fact that the profits which a charity
may generate are to be devoted to charitable purposes is hardly an
3
acceptable reason for depriving it of protection which is available to
those whose profits are generated solely for their own personal
enrichment. Today charities embark upon a wide range of commercial
activities to raise funds. They sell goods manufactured both by
themselves and by others. They provide services for reward. They
stage entertainments. They run competitions and conduct sweepstakes.
Indeed, precisely because they are charities, there is an advantage to
be gained by a third party who falsely represents expressly or by
implication that what he offers will, if bought, benefit a charity. They
are for that reason specially vulnerable and there should be no
hesitancy about acknowledging their entitlement to the protection
which the remedy against passing-off provides.
Cf.
Old
Apostolic
Church
of
South Africa
v
Non-White
Old
Apostolic
Church
of
Africa
1975 (2) SA 684
(C) at 687 D-E.
4
In this particular case I have no doubt that the annual
staging of a concert such as this is a continuing commercial enterprise
and amounts to the carrying on of a business. It was therefore open to respondent to invoke the remedies which the law provides against
unlawful competition.
I agree with the learned Chief Justice that respondent
failed to establish a proprietary interest in either the concept of such
a concert or the name "Last Night of the Proms" sufficient to entitle
it to prevent appellants or anyone else from replicating the concept or
using the name "Last Night of the Proms". However, I consider that
respondent did establish that the concerts which it staged in 1992 and
1993 in
Johannesburg
had been highly successful and that it had
acquired in consequence a legitimate proprietary interest deserving of
protection, not in order to prevent others from staging similar concerts
5
or from using the name "Last Night of the Proms", but in order to
prevent others from suggesting that their concerts were a continuation
of the concerts so successfully staged by respondent in 1992 and 1993
in Johannesburg. It matters not that those who attended and enjoyed,
or were told about the enjoyment those concerts provided, might not have known that they were respondent's concerts. Nor does it matter
that they might have mistakenly thought that they were Nedbank's
concerts or even appellants' concerts. If, as a fact, they were
respondent's concerts (and they plainly were), respondent is entitled to
complain if a connection is suggested between its concerts and those
which others seek to stage. The suggestion of such a connection
would obviously be motivated by a desire to entice those who had
attended and enjoyed respondent's concerts, or those who had heard
about them, to attend the rival concerts in the expectation that they
6
would be of the same quality organizationally and musically.
I have no doubt that appellants deliberately sought to
create the impression that the concerts which they intended to stage
were, as the Court a quo put it, "the continuation of the previous two
(series of) concerts". In the advertisement which respondents placed
in the Star newspaper in August 1993 there are depicted three balloons
upon each of which is written respectively, "1992", "1993" and
"1994". This, coupled with the use of the word "original" in the title
of the concert, is a blatant attempt to suggest that the 1994
Johannesburg concerts were sequels to the previous highly successful
1992 and 1993 concerts and that they emanated from the same source.
The fact that a different charity was reflected as the beneficiary and
that the 1994 concerts were stated to be presented by Promenade does
not undo the mischief. The less explicit the publicity given at the time
7
of respondent's concerts in 1992 and 1993 to the fact that they were
actually respondent's concerts, the less effective in dispelling any
suggestion of a connection is disclosure in the advertisement of
another charity as beneficiary and of Promenade as presenter. The
letter (annexure "U" to the founding affidavit) written by Williams to
persons who had supported Life Line's concerts is equally plainly a
calculated attempt to create and foster the impression that the 1992
and 1993 concerts in Johannesburg were the first two in a series of
concerts staged by Williams in aid of charities and that she was the
controlling and autonomously functioning hand behind the concerts,
with the power to designate what particular charity would benefit from
them. That was a perversion of the truth and a deliberate attempt to
capitalise on the success of respondent's 1992 and 1993 concerts by
suggesting that those who were ultimately responsible for the 1992 and
8
1993 concerts would still be at the helm of the 1994 concerts.
Nowhere is there any disclosure of the fact that Williams and her
close corporation were no more than respondent's hired hands -
important and vital hired hands to be sure - but hired hands for all
that. On the contrary, respondent is portrayed as a passive and
fortunate beneficiary of the 1992 and 1993 concerts for whom
Williams had now done enough. There is no reason to think that the
attempt at deception was calculated to fail.
In my view, what appellants did therefore amounted to a
wrongful passing-off which entitled respondent to some relief.
However it was not the principal relief which respondent sought, nor
was it the relief which the Court a quo granted. It was open to the
Court a quo to grant alternative relief and, but for the fact that this is
a minority judgment, I would have formulated an appropriate order in
9
substitution for that granted by the Court a quo. In substance it would
have prohibited appellants from representing directly or indirectly that
their concerts are a continuation of the concerts which respondent
staged in
Johannesburg
in 1992 and 1993.
I turn to the alternative cause of action: unlawful
competition. Reluctant as one may be to have to opine on matters of
ethics and business morality, the decision of this Court in
Schultz v
Butt
1986 (3) SA 667
(A) obliges one to do so when a claim that
competition is unlawful is made and the claimant is not objecting to
one of the more clearly defined manifestations of unlawful competition such as passing-off, or trademark infringement. The test is
ultimately
whether the conduct complained of is offensive to the general sense
of justice of society because it is incompatible with boni mores.
consider that even if due allowance be made for the need to avoid
10
taking an unduly censorious view of the conduct of businessmen and
women in their pursuit of profit, the conduct of Williams should be
regarded as unacceptable. She was hired at considerable expense to organize and promote respondent's concerts. Her conduct throughout
her association with respondent shows that she was intent upon
exploiting the commercial opportunities of such concerts to the future
detriment of respondent. Her surreptitious attempt to have the name
registered as a trademark while still working for respondent and after
respondent has asked her to investigate whether respondent could
register the mark, was deceitful and underhand and an attempt to steal
a march on her client. Her incorporation in March 1992 of a new
close corporation (Orchestral Productions whose name was changed in
June 1993 to Promenade Concerts) and the unauthorised placing in the programme for the 1992 concerts of a postcard inviting early
booking
11
for the "1993 Proms" and requiring it to be sent, not to her, but to the
newly formed close corporation were but further steps in her campaign
of exploitation of the opportunity, presented by respondent having hired her to organize its concerts, of competing subsequently with
respondent. The advertisements which she placed and the letter
(annexure "U" to the founding affidavit) which she wrote to those who
had attended respondent's concerts are yet further examples of her
cynical exploitation of the situation. Her selection of dates for her
own concerts was yet another attempt to pre-empt respondent's concerts.
It must be emphasised that this is not a case in which the
question is whether a third party would have been acting unlawfully
if he had behaved in a similar manner. The question is whether the
law permits Williams who had been hired and paid by respondent to
12
promote its concerts and generate goodwill for its concerts, to behave
in a manner so patently incompatible with what she had been paid to
do for respondent. The answer depends upon whether or not such
conduct is consistent with the boni mores and general sense of justice
of contemporary society. In
Trego v Hunt
1896 AC 7
the House of
Lords decided that even in the absence of a restraint clause, the seller
of a business was not entitled to trade in opposition to the buyer for
the simple reason that the seller could not be permitted to erode, by
competing with the buyer, the value of the goodwill for which he had
been paid. Here, appellant was paid inter alia to generate support for
respondent's concerts. She used the opportunity to prepare the ground for a diversion of the supporters of respondent's concerts to
her own
concerts and thereafter set about competing directly with respondent
the moment her contract with respondent had come to an end.
13
I have
little
doubt that conduct of this kind is beyond the
pale of what may legitimately be done in the name of even the robust
competitiveness which characterises modern business, and that it
should not be dignified with the epithet lawful. I conclude therefore
that this cause of action too was made out and that respondent was
entitled to some form of relief by way of interdict.
For these reasons, I would dismiss the appeal after
recasting the interdict to conform to the relief to which I think
respondent had shown itself to be entitled. A consideration of the
precise form which the relief should take and what orders as to costs
would be appropriate is not justified in the light of the view which the
learned Chief Justice and the other members of the Court take of the
matter.
R M MARAIS