Galison Manufacturing (Proprietary) Limited v Set Point Industrial Technology (Proprietary) Limited and Another (98/4753) [2009] ZACCP 1; 2009 BIP 5 (CP) (30 January 2009)

IN THE COURT OF THE COMMISSIONER OF PATENTS

FOR THE REPUBLIC OF SOUTH AFRICA

Date: 2009-01-30

NOT REPORTABLE

Case Number: Patent 98/4753

In the matter between:

GALISON MANUFACTURING (PROPRIETARY)

LIMITED

Plaintiff

and

SET POINT INDUSTRIAL TECHNOLOGY

(PROPRIETARY) LIMITED First Defendant

SHOCK PROOF INVESTMENTS 82

(PROPRIETARY) LIMITED Second Defendant

JUDGMENT

SOUTHWOOD J

[1] In this action the plaintiff seeks an order in terms of section 28 of the Patents Act, 57 of 1998 (‘the Act’) that the first defendant assign to the plaintiff South African Patent 98/4753 entitled ‘Discharge Rail Hopper’ (‘the patent’) and the right to claim damages for past infringement of the patent:

Alternatively: an order declaring the plaintiff to be the proprietor of the patent and –

(i) authorising the registrar of patents to enter the name of the plaintiff in the register of patents as the proprietor of the patent; and

(ii) granting the plaintiff the right to claim damages for past infringements of the patent save to the extent that past claims for such damages have been determined:

Further alternatively: an order declaring the plaintiff and the first defendant to be joint proprietors of the patent and

(i) authorising the registrar of patents to enter the name of the plaintiff in the register of patents as joint patentee of the patent; and

(ii) granting the plaintiff the right, subject to the provisions of section 49(4) of the Act, to claim damages for past infringements of the patent save to the extent that past claims for such damages have been determined.

The plaintiff also claims the costs of suit but no longer seeks the costs of two counsel. The first defendant (which I shall refer to as ‘the defendant’) disputes that the plaintiff is entitled to any of this relief.

[2] The action is concerned with who is entitled to the patent. The central issue is whether the plaintiff’s two employees, Peter Thorburn (‘Thorburn’) and Robert Skelton (‘Skelton’), devised the invention of the patent or whether George Johannes Christoffel Crause (‘Crause’) was the sole inventor of the invention and was therefore entitled to apply for registration of the patent. The defendant accepts that if Thorburn and Skelton devised the invention, they did so in the course and scope of their employment with the plaintiff and that the plaintiff will be entitled to be registered as patentee of the patent. If the plaintiff cannot prove that Thorburn and Skelton devised the invention of the patent then the plaintiff will not be entitled to any relief. The plaintiff seeks the further alternative relief only if the court finds that Thorburn, Skelton and Crause were co-inventors of the invention.

[3] As a result of the formal admissions made in the pleadings and during the hearing it is common cause that:-

(1) on 3 June 1998 Crause lodged an application for the registration of the patent;

(2) on 29 December 1998 the registrar accepted the patent;

(3) on 24 February 1999 the registrar granted the patent;

(4) Crause is recorded in the register of patents as the sole inventor of the invention disclosed in the patent (‘the invention’), the applicant for the patent and the original patentee;

(5) the patent was assigned from Crause to Sparrow Mining Supplies (Pty) Ltd, from Sparrow Mining Supplies (Pty) Ltd, to the defendant and from the defendant to Shock Proof Investments 82 (Pty) Ltd, the second defendant.

After the pleadings in the case against the defendant were closed the plaintiff obtained an order permitting it to join the second defendant as a party to this action and the plaintiff served copies of the pleadings on the second defendant. The second defendant did not file a plea. At the commencement of the trial it was represented by Adv. C. Harms who informed the court (in chambers) that the second defendant did not wish to file a plea or participate in the trial and that it is only interested in the outcome. The second defendant’s counsel was then excused from further attendance at court.

[4] The central issue relates to events which occurred between 1995 and 1997. The parties prepared separate bundles of documents which they intended to use at the hearing. Each bundle is sequentially numbered and the documents have item numbers. The parties and the witnesses usually referred to the documents by their item number – designated P (plaintiff’s bundle) and D (defendant’s bundle) followed by the page number in the bundle.

[5] As will appear later the versions of the parties as to who devised the invention are mutually destructive. The plaintiff alleges that its two

employees, Thorburn and Skelton, devised the invention and the patentee, Crause, was not involved. On the other hand, the defendant alleges that Crause was the sole inventor and that the plaintiff’s employees were not involved. This is a factual issue on which the plaintiff bears the onus - Pillay v Krishna and Another 1946 AD 946 at 951.

[6] (1) In National Employers’ General Insurance Co Ltd v Jagers 1984 (4) SA 437 (ECD) at 440D-H the court considered how the onus is discharged in cases where the opposing versions are mutually destructive:

‘… (I)n any civil case, as in any criminal case, the onus can ordinarily only be discharged by adducing credible evidence to support the case of the party on whom the onus rests. In a civil case the onus is obviously not as heavy as it is in a criminal case, but nevertheless where the onus rests on the plaintiff as in the present case, and where there are two mutually destructive stories, he can only succeed if he satisfies the Court on a preponderance of probabilities that his version is true and accurate and therefore acceptable, and that the other version advanced by the defendant is therefore false or mistaken and falls to be rejected. In deciding whether that evidence is true or not the Court will weigh up and test the plaintiff’s allegations against the general probabilities. The estimate of the credibility of a witness will therefore be inextricably bound with a consideration of the probabilities of the case and, if the balance of probabilities favours the plaintiff, then the Court will accept his version as being probably true. If however the probabilities are evenly balanced in the sense that they do not favour the plaintiff’s case any more than they do the defendant’s, the plaintiff can only succeed if the Court nevertheless believes him and is satisfied that his evidence is true and that the defendant’s version is false.’

(2) In SFW Group Ltd & Another v Martell et cie & Others 2003 (1) SA 11 (SCA) at para 5 the court said:

‘On the central issue, as to what the parties actually decided, there are two irreconcilable versions. So, too, on a number of peripheral areas of dispute which may have a bearing on the probabilities. The technique generally employed by the courts in resolving factual disputes of this nature may conveniently be summarised as follows. To come to a conclusion on the disputed issues a court must make findings on (a) the credibility of the various factual witnesses; (b) their reliability; and (c) the probabilities. As to (a), the court’s finding on the credibility of a particular witness will depend on its impression about the veracity of the witness. That in turn will depend on a variety of subsidiary factors, not necessarily in order of importance, such as (i) the witness’ candour and demeanour in the witness-box, (ii) his bias, latent and blatant, (iii) internal

contradictions in his evidence, (iv) external contradictions with what was pleaded or put on his behalf, or with established fact or with his own extracurial statements or actions, (v) the probability or improbability of particular aspects of his version, (vi) the calibre and cogency of his performance compared to that of other witnesses testifying about the same incident or events. As to (b), a witness’ reliability will depend, apart from the factors mentioned under (a)(ii), (iv) and (v) above, on (i) the opportunities he had to experience or observe the event in question and (ii) the quality, integrity and independence of his recall thereof. As to (c), this necessitates an analysis and evaluation of the probability or improbability of each party’s version on each of the disputed issues. In the light of its assessment of (a), (b) and (c) the court will then, as a final step, determine whether the party burdened with the onus of proof has succeeded in discharging it. The hard case, which will doubtless be the rare one, occurs when a court’s credibility

findings compel it in one direction and its evaluation of the general probabilities in another. The more convincing the former, the less convincing will be the latter. But when all factors are equipoised probabilities prevail.’

(3) In Neethling v Du Preez and Others [1993] ZASCA 203; 1994 (1) SA 708 (A) at 800C-D the court emphasised that when the case turns on the mutually destructive versions of two (or more) witnesses their

relative merits as witnesses are matters of cardinal importance.

[7] In order to understand the evidence it is necessary to comprehend the field of the invention: i.e. hoppers.

Hoppers

[8] Hoppers are used extensively in the mining industry for the transportation of ore. Generally speaking, a hopper consists of a wheeled chassis and a body mounted on the chassis which has side and end walls and usually a discharge aperture at the bottom. In the present case the hoppers have railway wheels and a door at the bottom which hangs on pivots situated at each end of the hopper. When the load is to be discharged the door is displaced by an arm terminating in a roller which is lifted by a ramp alongside the railway track on which the hopper runs. An alternative means of discharging ore is by means of a plate (scroll) mounted onto the door of the hopper which is lifted by wheels positioned next to the railway line.

[9] (1) In 1980 Abraham Petrus Louw Kotze registered patent no 80/7574 (‘the 1980 patent’) entitled ‘Wedge Door Hopper’ (D111p220-231). The object of the invention was to provide a bottom discharge hopper which would minimize the main problem encountered with existing hoppers: i.e. the bridging of the load leading to incomplete evacuation and imprecise dumping of the load which can cause derailment of the hopper or its successors.

(2) The patent specification describes the invention as follows:

‘A bottom discharge hopper according to the invention includes a container body for broken rock which is fixed to a wheeled chassis and includes end and side walls with the lower end of one side wall spaced horizontally from and vertically above the lower end of the remaining side wall to define a gravity discharge opening in the body, a door for opening and closing the opening in the body including side arms which are pivotally connected to the body end wall with their pivots in axial alignment at a position above the opening and the base member which is fixed to and extends between the side arms with the base member being inclined to the horizontal at a mean angle of between 28 degrees and 45 degrees in the closed position of the door and clear of the opening in the opened position of the door and means on the door for moving it between the opened and closed positions. Preferably the angle of the door to the horizontal is between 20 and 35 degrees and the base member of the door is flat.

Further according to the invention the side walls of the body are smoothly curved with their lower edges which define their opening converging towards each other.’

(3) This description encompasses claims 1, 2, 3 and 5 of the patent.

(4) Claim 13 is for ‘a bottom discharge hopper substantially as herein described with reference to and as illustrated in the drawings’.

(5) The end elevation drawing of the hopper (D111p230) shows a long and a short side wall, both smoothly curved, converging towards each other with their lower edges defining the opening; a pivot for the door positioned to the left of the centre line of the hopper, and a flat door which extends from the bottom of the long side wall to the bottom of the short side wall. The short side wall is about half the length of the long side wall which means that the flat door slopes at an angle of about 35 degrees.

[10] (1) In 1998 Crause registered patent number 98/4753 entitled ‘Discharge Rail Hopper’ relating to a bottom discharge rail hopper for conveying and discharging ore in a mine. (Pleadings p7-20).

‘A bottom discharge rail hopper according to the invention includes a wheeled frame, an open topped container body which is mounted on the frame and has end walls which are normal to the direction of the hopper travel, a first side wall, a door which extends over the length of the hopper and is pivotally held from the end walls of the container body to define a base portion and a substantial portion of a second side wall of the container body and a fixed second side wall portion above the door which extends from the open top of the hopper at an angle towards the side wall portion of the door in the container body and means on the door for moving the door from the first position in which its edge remote from the second side wall portion of the door closes with the first side wall and a second position in which the base portion of the door and the lower portion of the first side wall define between them a bottom discharge opening from the container body. Preferably, the container body discharge opening, in the second position of the door, is positioned to discharge material from the container body into a tip between the rails which carries the

hopper.

In a preferred form of the invention the pivot axis of the door is displaced from the vertical centre lines of the end walls of the container body towards the second side wall of the body to a position in which the door is caused to be gravity biased to its first position. The door is conveniently caused to move outwardly from the position which it occupied in its first position in moving from its first to its second position of operation to increase the internal volume of the container body more easily to release material in the container body through its discharge opening.’

(3) This description encompasses claims 1, 2 and 3 of the patent.

(4) Claim 9 is for ‘a bottom discharge rail hopper substantially as herein described with reference to and as illustrated in the drawings.’

(5) The end elevation drawing shows two side walls, one much longer than the other and an elongated door, half flat and half curved, the curved part constituting a large part of the side wall when in the closed position: the short side wall having a negative angle (i.e. sloping outwards rather than inwards) and the pivot for the door to the right of the centre line of the hopper.

[11] The invention of the patent differs from the invention of the 1980 patent in the following respects:

(1) The short side wall is much shorter and the door is much wider: the wider door comprises both the door and the remaining part of the side wall below the short side wall;

(2) The short side wall has a negative angle which creates a space for the wider door to open into;

(3) The pivots for the door are situated to the right of the centreline of the hopper: i.e. closer to the shorter side wall and door.

[12] The object of these differences was to improve the invention of the 1980 patent. These differences will be referred to collectively as ‘the inventive concept’.

[13] Hoppers manufactured in accordance with the 1980 patent were very successful. Large numbers were manufactured and sold during the existence of the patent and even thereafter. However, because of the shape of the hopper bin and the size of the door problems were experienced with discharging sticky ore such as UG2 platinum ore. Due to the funnelling effect of the two converging side walls and the size of the door the sticky ore tended to ‘bridge’ and not discharge properly. The inventive concept was an attempt to deal with this problem. As already mentioned, the issue in this case is who was responsible for devising the inventive concept.

The Law

[14] (1) In terms of section 27 of the Act an application for a patent in respect of an invention may be made by the inventor or by any other person acquiring from him the right to apply or by both such inventor and such other person. In the present case the dispute is between persons who each claim to be the sole inventor.

(2) The parties agree that the powers of the Commissioner to decide the dispute are to be found in section 28 of the Act which provides in subsection (1) –

‘Where a dispute arises between persons as to their rights to obtain a patent for or to make, use, exercise or dispose of an invention, or as to the right or title in a patent, any such party may apply to the commissioner to decide the matter in dispute, and the commissioner shall decide the matter in dispute.’

(3) The parties agree that there is no South African precedent dealing with this issue. The plaintiff’s counsel referred to the judgment in Stanelco Fibre Optics Ltd’s Applications [2005] RPC 15 (Ch. D) where the learned judge said at 326 lines 12-13 –

‘The task of the court is to identify the inventive concept of the patent or application and identify who devised it … The court is not concerned with issues of validity or inventiveness: merely with the concept as described.’

The defendant’s counsel does not contend that this statement is not appropriate on the facts of the present case and it will be accepted as the proper approach to be adopted to the dispute.

[15] The issue in this case must be considered against the background of the following facts which are common cause or are not disputed:-

(1) Thorburn has a BSc in Mechanical Engineering and is a registered professional engineer. He registered the plaintiff about 31 years ago mainly to manufacture deep-level hard-rock mining machinery for underground mining operations and to manufacture mining equipment for surface operations. Before he registered the plaintiff Thorburn worked for a company which conducted business under the name of Welkom Engineers, first as the manager and then as the managing director. Thorburn has always been interested in devising inventions which are useful in the mining industry. Over the years he has devised some 70 inventions for which patents have been registered (D90-158). Thorburn is obviously keenly aware of intellectual property rights and their value.

(2) Thorburn has built up the business of the plaintiff extensively. The plaintiff still conducts its operations at premises in Welkom but it now does so in seven very large workshops. The plaintiff is one of the largest manufacturers of mining equipment (including hoppers) in South Africa.

(3) Crause qualified as a fitter and turner in 1969 and after obtaining an Engineering Diploma at the Welkom Technikon entered employment with Western Holdings, the owner of Western Deep Levels, where he trained as a mechanical engineer and received his Government Certificate of Competence in 1973. He worked as an engineer at No 4 shaft, Western Deep Levels, from 1973- 1978 when he was promoted Divisional Engineer for the Eastern Section of the mine. He was recognised by his employers for the equipment he designed for improving efficiency. Crause continued to work for Western Deep Levels for another 10 years. During that period he chaired the Mines Standards Committee which decides what equipment is to be acquired for the mine. In 1988 Crause’s employment was summarily terminated. Shortly afterwards he was appointed a Mining Inspector by the Department of Mineral and Energy Affairs and the following year (1989) he was appointed Chief Inspector for the North West region which includes Carletonville and Rustenburg. He was responsible for the health and safety of miners and their equipment. He held that position until 2004 when he retired at the age of 56. The normal retiring age is 63.

(4) Crause is the son of Hermanus Johannes Petrus Crause who was the inventor of the 1980 patent. Crause is the inventor of at least two patents which have been registered.

(5) Crause, his wife, Elizabeth, and his son, Renier, were, at various times, involved in Seran Engineering & Supplies CC (now Seran

Engineering & Supplies (Pty) Ltd) (‘Seran’) which supplied mines with mining equipment. In 1995, after he had

completed his studies as an engineer, Renier Crause started working for Seran. At about the same time Mick Bear who conducted business as Complete Projects inter alia supplying hoppers to mines, decided to emigrate and he gave his business, Complete Projects, to Renier Crause. From that time Seran conducted the business of Complete Projects. Complete Projects supplied wedge door hoppers (WDHs) made in accordance with the 1980 patent. For a while JMB Engineering made the WDHs but after it was awarded a very large contract JMB Engineering decided to stop manufacturing WDHs so that it could concentrate on the new contract. Complete Projects was therefore obliged to find another manufacturer for the WDHs.

(6) Towards the end of 1995 or in early 1996 Crause, who had an interest in the business of Complete Projects, approached the plaintiff with a view to the plaintiff

manufacturing the WDHs. Crause spoke to Thorburn who insisted on seeing the WDH. Thorburn had heard of the WDH but had not seen one. Crause arranged for Thorburn to visit JMB Engineering’s premises in Potchefstroom to see a WDH. Crause impressed upon

Thorburn that it was possible for a WDH to be pushed through the ramp by hand. This was a big advantage and an important selling point. Thorburn, accompanied by the plaintiff’s managing director, Gary Wilson, the plaintiff’s chief draftsman, Lee Hibbert, and another employee went to JMB Engineering’s premises in Potchefstroom where Crause showed them how the WDH could be manually pushed over the ramp causing it to discharge. Thorburn was impressed by the demonstration and they went to Crause’s house in Potchefstroom where they discussed the plaintiff manufacturing the WDH for Complete Projects. They orally agreed, in principle, that the plaintiff would manufacture the WDH in accordance with the 1980 patent for Complete Projects. Crause handed to Thorburn three working drawings for the WDH which he, Crause, had received from JMB Engineering. Thorburn took the drawings with him when he left the meeting.

(7) At the plaintiff’s Welkom premises Thorburn and Hibbert discovered that the drawings were not sufficiently detailed for the plaintiff to manufacture the WDH. In May 1996 Hibbert prepared a set of working drawings for the plaintiff to manufacture the WDH (P32, P32A and P32B p31-33) and on 14 May 1996 the plaintiff received its first order from Complete Projects for the manufacture of 10 WDHs (P33 p34). Thereafter Complete Projects placed further orders with the plaintiff for the manufacture of WDHs and the plaintiff manufactured and sold WDHs to Complete Projects.

(8) On 21 October 1996 the plaintiff, represented by Thorburn, and E.C. Crause, Crause’s wife, Elizabeth, who was then the patentee of the 1980 patent entered into a written agreement (‘the licence agreement’) in terms of which –

(i) Elizabeth Crause granted to the plaintiff, subject to certain exceptions, the exclusive right in the Republic of South Africa to manufacture and sell the WDH;

(ii) the plaintiff, in consideration of the rights granted to it in terms of the agreement, undertook to pay the following royalties to the patentee –

(a) 3 % of the nett sales value of hoppers and spare parts falling within the scope of the patent;

(b) 5 % of the nett sales value of hoppers falling within the scope of the patent where the sale was as a direct result of the intervention of Crause;

(iii) the plaintiff would pay the royalties each month within 30 days;

(iv) it was recorded that –

(a) Elizabeth Crause granted to Triangle Engineering the right to manufacture and sell WDHs falling within the scope of the patent to Grootvlei Goldmine Mining Co Ltd for its exclusive use; and

(b) the plaintiff granted to Complete Projects CC exclusive selling rights to sell WDHs falling within the scope of the patent to Eastern Platinum, Western Platinum and Karee mines;

(v) each of the parties was obliged to communicate forthwith to the other party all information relating to any modifications or improvements of the WDHs falling within the scope of the patent which he/it may come possessed of during the subsistence of the patent;

(vi) modifications or improvements would not be regarded as being modifications or improvements to WDHs falling within the scope of the patent if they were capable of sustaining an independent patent;

(vii) if the parties agreed that one or more patents of addition should be obtained to protect any modifications or improvements, after competent advice had been obtained by either party, the patents of addition would be obtained in the name of E.C. Crause;

(viii) the agreement would subsist until the patent expired (D13 p32-36);

(9) Pursuant to the licence agreement the plaintiff manufactured and sold WDHs to various purchasers including Complete Projects and paid royalties to Elizabeth Crause and Crause. On occasion Complete Projects complained that the plaintiff did not deliver WDHs on time;

(10) Thorburn always considered the scroll the best and the most cost-effective means of opening the hopper to discharge the ore and, in 1997, at the insistence of his sales manager, Rod McCrae, started investigating a wide door version of the WDH with a scroll. Hibbert prepared working drawings in September 1997 and on 5 November 1997 Thorburn Consulting Engineers (Pty) Ltd lodged a provisional specification for this hopper with a scroll (P40 p41). Thorburn was the inventor. The invention of the provisional specification was a modification of the WDH. It had a wider door to increase the size of the discharge opening. It had a latching system which held the door closed during transportation and automatically released when the hopper reached its tip. It had a scroll attached to the terminal edge of the door next to the lower end of the short sidewall to engage with wheels mounted alongside the railway line.

(11) On 13 November 1997, without disclosing to E.C. Crause or Crause that the plaintiff had lodged a provisional specification Thorburn addressed a letter to Crause regarding ‘an idea which we have to enable the WDHs to be used on 3 Wheel Tipping Ramps’. Attached to this letter was a drawing showing the end elevation of the hopper with the door in the open and closed positions. The door is extended with a curved portion extending upwards to the lower edge of the short sidewall. The pivots for the door are situated to the left of the centre line and the two sidewalls converge on each other. In the letter Thorburn asked Crause to comment on three problems: the bulging in the door as it would be carrying virtually all the rock; the lengthening of the pivot which would have to be much longer than the standard wedge door hoppers and the locking device. (P17 p13).

(12) Crause did not respond to this letter.

(13) In about March 1998 the plaintiff prepared working drawings for the manufacture of Wide Door Hoppers covered by the patent. On 30 March 1998 the plaintiff completed the working drawing for wide door WDHs to be manufactured for Eastern Platinum (P23-25 p20-22).

(14) In about May 1998 the plaintiff prepared working drawings for the manufacture of the WDH with scroll. On 20 May 1998 the plaintiff completed the working drawings (P26 p23).

(15) On 3 June 1998 Crause lodged his application for the patent and shortly thereafter told Thorburn that he, Crause, had done so. Thorburn expressed no surprise or concern about the patent and did not claim that it should have been registered in the name of the plaintiff because he, Thorburn, and Skelton (or any other of the plaintiff’s employees) had devised the invention covered by the patent.

(16) From June 1998 until December 2000 the plaintiff continued to manufacture and sell WDHs to various purchasers including Complete Projects and paid royalties in accordance with the licence agreement. The plaintiff also manufactured and sold wide door hoppers covered by the patent. The plaintiff did not seek to amend the licence agreement to make provision for the manufacture and sale of the wide door hopper in accordance with the patent and the payment of royalties.

(17) On 16 November 2000 Elizabeth Crause on behalf of Complete Projects addressed a letter to the plaintiff in which she made proposals for a new agreement for the manufacture and sale of WDHs and wide door hoppers covered by the plaintiff’s patent no 97/9941 which Elizabeth Crause alleged was a patent of addition and should have been registered in her name and should be rectified. She also proposed that the plaintiff offer the WDH with scroll (in accordance with the patent of addition: no 97/9941) and Complete Projects the wide door hopper with dolly arm (i.e the patent) and suggested a mark-up and commission to be paid by the plaintiff to Complete Projects. There is no letter from the plaintiff to allege that it is entitled to the patent in respect of the wide door hopper (D47 p89-91).

(18) On 4 December 2000 the 1980 patent expired and the licence agreement came to an end. The plaintiff and Crause and Elizabeth Crause negotiated unsuccessfully to extend or renew the licence agreement.

(19) Early in 2001 the relationship between the plaintiff and Complete Projects began to deteriorate and Complete Projects stopped placing orders for the WDHs and wide door hoppers with the plaintiff.

(20) On 23 February 2001, Thorburn, on behalf of the plaintiff, prepared a letter to be handed to potential customers to advise them of the fact that the plaintiff holds the copyright in respect of the drawings for the WDHs and wide door hoppers which it had been manufacturing since May 1996. In the letter Thorburn did not refer to the plaintiff’s patent for the WDH with scroll or the fact that it claimed to be the inventor of the invention of the patent (D54 p101);

(21) On 12 September 2001 the plaintiff’s attorneys, Spoor & Fisher, addressed a letter to Crause to advise him that the patent was invalid. In paragraph 2 of the letter Spoor & Fisher stated that –

‘The alleged invention claimed in your patent was at best for you made jointly by Mr Thorburn, Mr Wilson, and yourself during various meetings with our client’s offices during about March 1998.’

In paragraph 3 the letter reiterates that the meetings took place between Thorburn, Wilson, Hibbert and Crause during March 1998.

Spoor & Fisher then demanded that Crause surrender the patent and informed him that if he failed to do so the plaintiff would apply for the revocation of the patent. (D135 p281).

(22) On 26 October 2001, Wilson, the managing director of the plaintiff, addressed a letter to Crause in which he, on behalf of the plaintiff, offered to purchase ‘your patent 98/4753’ and offered to pay, in addition, ‘the standard commission as previously paid to you’ on all wide wedge door hoppers covered by the patent for as long as the patent is in force. Wilson also said the following:

‘My colleagues have insisted that if this offer is not accepted by the 02/11/01 it will be withdrawn and Galison will continue to take whatever action it has to in order to ensure its continued involvement in the Wide Wedge Door Hopper market, in direct competition with you or any other third party which may be involved, if necessary.’ (D76 p150).

(23) Late in 2001 the plaintiff discovered that the Anglo American Corporation had prohibited a subsidiary, Anglo Platinum, from purchasing the wide door hopper from the plaintiff. Thorburn attempted to arrange a meeting with the Anglo American legal department to deal with the problem. Ms Vangelatos of Anglo American requested Thorburn to furnish her with a memorandum to be used as a basis for the discussion. On 14 November 2001 Thorburn addressed a letter and a memorandum to Ms Vangelatos. In the letter (D79 p156) Thorburn apologised for the delay in sending the memorandum and said ‘we felt that it was essential as far as possible, be absolutely accurate in all of our statements’. The thrust of the (original unmarked) memorandum (D79 p157-160) is that Crause was not the sole inventor of the invention but that the plaintiff’s personnel contributed substantially to the invention and that the plaintiff was therefore a co-inventor and entitled to be a joint patentee or a co-patentee of the patent. The memorandum states –

(i) in paragraph 3 that –

‘Crause and his son Renier were present at various times during the experimental phase and they worked together with Galison personnel to develop the new hopper with a wider door, i.e. the hopper which was later to be known as the Wide Door Wedge Door Hopper.’ (p157)

(ii) In paragraph 9 that –

‘Although the design of the hopper which formed the subject matter of the application was a work of joint collaboration between Galison

personnel and Chris Crause, Chris Crause declared himself to be the sole inventor of the invention.’ (p158-159)

(iii) In paragraphs 12.4, 12.5 and 12.6 that –

’12.4 Chris Crause was not entitled to apply for the patent because he was not the sole proprietor of the invention. Galison personnel

contributed substantially to the invention and are accordingly at least partial proprietors thereof.

12.5 The application for the patent was made in fraud of Galison’s rights in that the invention was at least made jointly by Galison personnel.

12.6 In making the patent application, Chris Crause knowingly made a false declaration to the effect that he was the sole inventor.’ (p159)

(24) On 11 February 2002 the plaintiff launched an application for revocation of the patent inter alia on the ground that the invention claimed was not patentable under section 25 of the Act because it was not new (A) and did not involve an inventive step (B) and because the patentee, Crause, was not a person entitled under section 27 of the Act to apply for the patent (C) (D139 p286-336). With regard to the last-mentioned ground the statement of particulars alleges in paragraph 5 –

‘The invention claimed in each of the claims of the patent was made by the applicant’s employees and in particular by Peter Thorburn, Gary Wilson and Robert Skelton, during the course and scope of their employment with the applicant’ (p289)

(25) The plaintiff has not prosecuted the application for revocation and it is still pending.

(26) On 5 July 2007 the plaintiff instituted this action in which it initially claimed that it is the sole inventor of the patent. In paragraph 5 of the plaintiff’s particulars of claim the plaintiff alleged –

‘What is recorded in the register notwithstanding, the true inventors of the invention were Peter Thorburn , Gary Wilson and Peter Skelton, who were employed by the plaintiff at the time that they invented the invention (“the plaintiff’s employees”). The invention was invented by the aforesaid persons in or about 1996. (Pleadings p4);

(27) On 4 August 2008, at the commencement of the trial, the plaintiff sought and was granted an amendment of its particulars of claim. Paragraph 5 now reads as follows –

‘What is recorded in the register notwithstanding, the true inventors of the invention were Peter Thorburn and Robert Skelton, who were employed by the plaintiff at the time that they invented the invention (“the plaintiff’s employees”),

alternatively, the inventors of the invention were the plaintiff’s employees together with Crause. The invention was invented by the aforesaid persons in or about 1996.’ (Pleadings as Amended p4).

[16] Thorburn’s and Crause’s versions of the devising of the invention may be summarised as follows.

Thorburn

[17] (1) Thorburn first became aware of the WDH when Crause approached him to manufacture it. He knew of the hopper called the ‘Mick Bear hopper’ (which is the WDH) but had never seen it in operation. Crause approached Thorburn in late 1995 or early 1996. Thorburn knew Crause from his previous job. They had had quite a lot to do with each other. Crause had been the Divisional Engineer at Western Deep Levels. He was now a senior mining inspector for the Carltonville/Rustenburg area.

(2) Crause told Thorburn about the 1980 patent.

(3) Thorburn told Crause that the plaintiff was keen to make the WDH as the plaintiff wanted to expand its hopper market. Thorburn knew Crause was chief inspector of mines and wielded enormous power over them. Thorburn thought that the plaintiff would be able to sell a lot of WDH’s particularly to the Rustenburg mines which mine platinum.

(4) Thorburn wanted to see the WDH and Crause arranged to take him to see one. Thorburn, Wilson, the plaintiff’s chief draftsman, Lee Hibbert, and one other employee, whose name Thorburn cannot remember, went to a factory in the Potchefstroom industrial area. There they found a WDH on rails and a ramp. Crause emphasised the fact that the hopper could be pushed over the ramp by hand. Crause and Wilson manually pushed it over the ramp and the hopper discharged.

(5) This demonstration impressed Thorburn. Afterwards they went to Crause’s house in Potchefstroom. Crause, Thorburn and Wilson discussed the manufacture of the WDH and agreed in principle that the plaintiff would manufacture the WDH for Crause. Crause gave Thorburn a roll of drawings. There were three drawings and when Thorburn and Wilson examined the drawings at the plaintiff’s factory they saw that the drawings were not proper working drawings and they told Crause that they would not manufacture the WDH without such drawings. Crause then arranged for a WDH to be taken to the plaintiff’s Welkom works. Hibbert measured the hopper and produced working drawings with the relevant measurements (P32 p31 dated 14 May 1996).

(6) On 14 May 1996 Complete Projects placed an order for 10 WDHs (P33 order 13217).

(7) On 22 October 1996 the plaintiff and Elizabeth Crause entered into a written agreement for the manufacture, sale and marketing of WDHs covered by the 1980 patent. (D13 p32). In terms of the agreement the plaintiff was given the exclusive right – subject to specified exceptions – to manufacture and sell WDHs covered by the 1980 patent and the plaintiff undertook to pay royalties to the patentee, E. Crause, and commission to Crause on sales of the WDHs resulting from his intervention (clauses 2.1 and 2.2).

(8) Pursuant to the agreement the plaintiff manufactured and sold the WDHs and paid royalties to Elizabeth Crause and commission to Crause. Thorburn considered that it was very good business.

(9) The licence agreement terminated on 4 December 2000 when the 1980 patent expired.

(10) This case is concerned with the Wide Door Dolly Wheel Hopper (referred to either as the WDDWH or Wide Door Hopper) 1998 patent. The patent application was lodged by Crause on the 3rd of June 1998.

(11) When the plaintiff and Crause agreed in principle that the plaintiff would manufacture the WDH, Thorburn insisted that he go underground to see the WDH in operation. Thorburn thinks this happened on the 11th or 21st of July 1996. They went to Eastern Platinum Mine, south east of Rustenburg. Thorburn saw the hoppers in operation. He noticed that they did not empty properly. It was sometimes necessary for the hopper to go over the ramp three or four times before it was completely empty. Thorburn realised that they were on to a good thing if they could get the hoppers to empty properly. While they were underground Thorburn said to Crause that they must increase the door size. By then Crause had been associated with the WDHs for 16 years and he was not pleased to be told that the hopper was not perfect. He was very angry with Thorburn. Thorburn told Crause that the ore ‘arched’ and would not come out. At that stage Thorburn did not know how much bigger the door must be – but thought it must be increased substantially. Thorburn was not sure exactly what had to be done but knew that if they put some thought into it they would solve the problem. After that Crause continued to promote the WDH.

(12) After the underground inspection of the hopper in about June/July 1996 Thorburn told Crause that he, Thorburn, was not happy with the door size. However Crause was not keen to spend money. Thorburn told Crause that the plaintiff would work out the increase to the door size at no cost to Crause. Thorburn asked Crause to get two hoppers from Western Platinum Mine for the plaintiff to work on. Crause did this and collected two hoppers in July 1996. The plaintiff’s truck collected the two hoppers on 3 July 1996 (P35 p36).

(13) Before they started working on the hoppers Thorburn discussed the changes with Crause. He told Crause that the plaintiff would make a bigger door – it would be wider and it would slide upwards, not sideways. This meant that a part of the short side wall would be cut away to allow for the wider door.

(14) Crause’s reaction was that this was an absolute waste of money. Nevertheless Crause suggested that instead of using new material to make the door wider the plaintiff should cut off the lower portion of the short side and weld it to the door. This was his sole contribution according to Thorburn.

(15) Thorburn gave instructions to his staff. He told them what he was trying to do: he wanted to make the door of the WDH considerably bigger to prevent blocking of the ore. He gave the work to Bobby Skelton and Joe Jacobs. Skelton was mainly involved in doing the work. He is a highly skilled boilermaker and, according to Thorburn, well-versed in the vagaries of hopper design.

(16) While the plaintiff was effecting the modifications Crause did not come to the plaintiff’s factory.

(17) Skelton got on with the work. Thorburn went to see how he was progressing every second day or so.

(18) Skelton first cut away about half of the short side of the hopper (see p230). He then welded this to the door. This part of the side wall then became part of the door and acted as part of the side wall.

(19) Skelton then strengthened the door at both ends. He tested the door by lifting the dolly wheel to open the door. The wider door almost immediately crashed with the side wall, it could only open about 150 mm.

(20) Skelton’s solution (after discussion with Thorburn and Jacobs) was to cut out the remaining part of the side wall, reverse it and weld it back into place. This narrowed the hopper by 200 mm but allowed room for the wider door to open. The door could now open to its full extent. It was important that the door not be too close to the wall because of the sticky ore – it was essential to get the door to move away from the side wall.

(21) Skelton then moved the pivot point of the door to ensure that the door moved away from the side wall. He moved the pivot point at least four times until it was right. After considerable experimentation Skelton determined that the best place for the pivot point was to the right of the centre line of the hopper. All this took about three to four weeks. Skelton overcame all the problems.

(22) When this was done Thorburn told Crause what they had done. Thorburn is not sure but he thinks Crause came to look. He asked the plaintiff to send the hopper back to Eastern Platinum Mine. The plaintiff delivered it back on 30 August 1996 (P36 p37).

(23) Thorburn and Skelton invented the invention to Crause’s patent lodged on 3 June 1998. They invented the invention in July/August 1996.

(24) Development of the Wide Door Hopper stopped in August 1996.

(25) Later, at the insistence of Rod McCrae, the plaintiff’s sales manager, the plaintiff decided to develop a wide door hopper with a scroll instead of a dolly wheel. The plaintiff widened the door, left the pivot point to the left of the centre line, put a curved surface at the top end of the door, lowered the pivot point to ensure that the scroll engaged with the wheels on the side of the track.

Crause

[18] (1) In 1995, Crause’s son Renier, who had taken over Mick Bear’s business, Complete Projects, spoke to Crause about improving the WDH. He thought they should widen the door so that it would discharge like the ‘bak’ hopper. He said that if they could do this they would have a winner.

(2) Towards the end of 1995 Crause suggested to Renier that they approach the plaintiff to make the WDH. Thorburn told them that before he makes the hopper he wants to see what it looks like and see for himself that it can be pushed through the tip by hand. Crause took Thorburn to the JMB Engineering premises in Potchefstroom where the hopper was shown to him. Thorburn was quite surprised to see that the hopper could be pushed through the tip by hand. Crause also explained the ‘give-way’ action to Thorburn. The ‘give-way’ action is the movement of the door away from the rock when the door starts to open. The idea is that there is an equilibrium before the door starts to open. When the hopper goes over the ramp the equilibrium is disturbed and the door opens easily. The weight of the ore helps the door to open. Thorburn was interested and said they must draw up a contract. Crause arranged to give Thorburn the drawings for the hopper. Thorburn told Crause that the drawings

were not good enough. The plaintiff would prepare its own drawings. The plaintiff did so and made WDHs after that. Crause spoke to Thorburn and got him to agree to make the WDH for his son. The plaintiff started to manufacture the hoppers at the beginning of 1996. The plaintiff did so before a contract was signed. On 22 October 1996 the plaintiff and Crause’s wife entered into a written agreement in terms of which Elizabeth Crause, the patentee, agreed to give the plaintiff the right to manufacture and sell the WDH covered by the 1980 patent. Thorburn insisted that the patent be in Elizabeth Crause’s name before he entered into an agreement with her.

(3) Crause says he invented the wide door dolly wheel hopper (i.e. wide door hopper) in about the middle of 1995 after his son asked him to assist in making the door of the WDH wider. Crause took a piece of paper and a pencil and using the WDH drawing at the back of the 1980 patent tried to show how to increase the door size. He could make it bigger and it would work but it would reduce the H factor (i.e. the volume of the hopper).

(4) In Crause’s first drawing (D107 p191) Crause tried to keep the tip of the door as close as possible to the axle of the hopper. The top drawing shows the WDH before the door was widened. The bottom drawing shows the WDH with the widened door. The change would work but the result (reduced volume) was not acceptable. Crause considered that there were five important factors for the hopper to be the ‘ultimate hopper’ –

(i) The hopper must go through the tip easily;

(ii) The hopper must discharge its contents without being rammed or vibrated – especially with regard to sticky UG2 platinum ore;

(iii) The hopper volume had to be as big as possible – taking the parameters of the mine into account;

(iv) The pivot point had to be as low as possible – it could not load easily if it was too high;

(v) The hopper must not leak – the ore is gold or platinum bearing – and this would reduce the efficiency of the mine.

(5) Crause’s second drawing (D1p10) was his second attempt to design a hopper with as big an H factor as possible and still open easily with a give-way action and able to open as easily as the WDH. This was not practical. There were numerous disadvantages and big volume was the only advantage. The disadvantage was that when it was to open it had to move rock out of the way. It was necessary for the door to move out of the way (give-way action) but thereafter it came close to the bottom of the side wall because the bottom of the curve moves up against the bottom of the side wall. In order to open, the flat bottom must lift the ore (exhibit ‘D’ original of D1 p10) (exhibit ‘E’ is an enlarged exhibit ‘D’ with points indicated on it). The door would have to lift to open and required a big force to do so. It was therefore not practical.

(6) The drawing in D1 p11 (exhibit ‘F’ is enlarged with points indicated on it) makes sure the hopper opens easily by providing a negative angle to the sidewall. It also has the maximum volume and moved the pivot point closer to the door (i.e. to the right of the centre line) and lower which gives a better give-way movement. However the top of the door will then collide with the side wall. The solution for that is to move the pivot point away from the door. The door then rotates away from the wall. But he could not do this so he changed the side wall. He turned it into a short wall with a negative angle. This improved the operation of the hopper – the top of the door moved away from the side wall. Point A moves away, point B moves parallel and points B to C do not touch the ore. Points C to D give way and D to E is the cavity which is additional space for the door.

(7) This hopper was the ultimate size and it was not necessary for the door to lift or squeeze the ore. Crause prepared the drawing exhibit ‘F’ in 1995.

(8) Crause did not patent this invention. Renier had just finished his studies and Crause wanted Renier to find his feet in the business. He did not want the additional marketing of a new product to distract him. He therefore did not attempt to get the hopper onto the market. Crause only started to take steps to get the wide door hopper into the market approximately three months after Renier’s death in May 1997. Until his son’s death, Crause sometimes went to the plaintiff to modify or refine the WDH.

(9) Crause went to No 1 shaft at Western Platinum Mine and asked the foreman Jan van Vuuren, the foreman in charge of repairing hoppers, for a scrap hopper to see if the ideas depicted in exhibit ‘F’ could be built into the WDH. Fanie van der Walt went to Western Platinum Mine and picked up the hopper and took it to a smallholding at Pretoria North (Strydfontein) to do the modifications. Glen Scott, a boilermaker employed by Complete Projects, undertook to do the work. Wayne Wiblin, a sales representative employed by Complete Projects, assisted Scott. Crause went to the smallholding and gave Scott instructions about what modifications were to be done. Crause wanted to experiment with the hopper as cheaply as possible - to see if the WDH could be converted into a wide door hopper as depicted in exhibit ‘F’. Crause intended to take the modified WDH to the plaintiff to use as a model to make a prototype. It would then be tested and used on the mine. Crause instructed Scott to do

the following –

(i) cut off the bottom of the short side wall;

(ii) weld the portion of the side wall, cut off, onto the door;

(iii) move the pivot point towards the door – to get the give- way action shown in exhibit ‘F’. When they did this Crause noted that the top part of the door crashed into the top part of the side wall;

(iv) turn around the remaining part of the side wall and give it a negative angle as shown in exhibit ‘F’. The top part of the door could move into the space behind the side wall.

(10) Scott did all the work in about a week. Crause was there every day. The work was done by trial and error. They moved the position of the pivot point a number of times. They did this until Crause was satisfied. When the work was complete Wiblin arranged for a truck to take the hopper to the plaintiff’s premises at Welkom. They took the hopper there to show the plaintiff how the WDHs should be modified.

(11) This was arranged by Crause with Joe Jacobs and Gary Wilson. The modified hopper was taken to Welkom in July 1997. Crause went to the plaintiff’s premises shortly afterwards to discuss the modifications. He regularly spoke with Jacobs and Skelton, the boilermaker, about the modifications. He told them he brought the hopper as a sample to get the hopper ready for the market. Jacobs told Crause that the plaintiff could not make the hopper without proper drawings. Crause explained to Thorburn, Wilson and Jacobs how he modified the hopper. He told them the model was to assist them to make drawings or modify the WDH. Crause also arranged for a second hopper in a better condition to be delivered to the plaintiff so that it could be modified and tested – to show that the widened door works with the WDH. Crause got the second hopper from No 3 shaft Eastern Platinum Mine (Armand Smit). Crause asked Smit to lend him the hopper so that he, Crause, could see if he could solve the discharge problem. Smit agreed. The second hopper was taken to the plaintiff and the plaintiff modified this hopper in accordance with the hopper that had been modified at Pretoria North. It was necessary to obtain the second hopper because the first hopper was in such poor condition. Skelton effected these modifications under the supervision of Jacobs. Crause went to the plaintiff’s workshop on a couple of times to explain how it should be done – particularly the positioning of the pivot point. It took about one month to modify the second hopper. Crause was very satisfied with the work done.

(12) The second hopper was then taken to No 1 shaft Western Platinum Mine where Crause got the first hopper. Jan van Vuuren took it underground to No 7 level. When Crause phoned a few days later Van Vuuren told him that the dolly wheel had run off the ramp and that there was a problem. Crause spoke to Jacobs and they went to Western Platinum Mine to see how to solve the problem. They found that people at the mine had welded a piece of flat plate onto the top of the ramp to widen the ramp so that the wheel would not fall off. Exhibits ‘B’ and ‘C’ depict the wide door hopper – ‘B’ shows the door closed: ‘C’ shows the door open (these to exhibits were made by the plaintiff shortly before the trial to show what they remember doing to the hopper).

(13) After this test the wide door hopper was taken to a number of mines to be tested. It was then returned to Eastern Platinum Mine. Testing took place between July and August 1997. Crause now knew that the wide door hopper could be made.

(14) In March 1998 Crause went to the plaintiff to make the wide door hopper. The plaintiff insisted on preparing drawings and Lee Hibbert made drawings on the 14th of March 1998. Before he did the drawings the plaintiff wanted to be sure that the hopper was operating properly. The plaintiff

wanted to do tests and experiments. On 30 March 1998 Hibbert completed the drawings (P23 p20). Crause was standing behind Hibbert when Hibbert did the drawings. Crause had to assist him with the drawing - to put the pivot point in the right place. The plaintiff started to manufacture the wide door hopper in June/July 1998.

(15) Crause told Thorburn before the 3rd of June 1998 that he, Crause, was going to register a patent for the wide door hopper. Crause showed him the drawings of the WDH. Thorburn said they could put a scroll on it. Thorburn’s reaction to being told about the patent was to assist and get the production going. The plaintiff took out a patent for the wide door hopper with scroll in November 1997.

Other witnesses

[19] The plaintiff called two other witnesses, Joseph Jacobs, a foreman at the plaintiff’s works and Robert Skelton, a boilermaker. It was not suggested to Jacobs and Skelton that they were wrong about the modification of the WDH or that they were fabricating their evidence to assist the plaintiff. Their evidence may be summarised as follows:

(1) Jacobs

According to Jacobs, the plaintiff started to make WDHs after a truck brought a WDH to the plaintiff’s factory and Lee Hibbert measured the hopper and prepared drawings for it. Later, after the plaintiff had manufactured a number of WDHs two WDHs arrived from a mine and Thorburn instructed them to see how the plaintiff could widen the door. One of the WDHs was taken to Skelton’s workshop and they told him what had to be done. Jacobs left Skelton to get on with the modifications as according to Jacobs Skelton knows how to get things done. Jacobs was not physically involved in the modification of the WDH. The arrangement was that Skelton would consult Jacobs if he, Skelton, needed advice or authority to proceed. Jacobs knows that Skelton cut off a section of the side wall which was between 450 mm and 550 mm wide to join to the door. He also knows that after the side was joined to the door it fouled against the rest of the side wall and that they agreed to cut the rest of the side wall out and turn it around. This was Skelton’s idea. According to Jacobs the work was done in July/August 1996.

(2) Skelton

Skelton testified that apart from an absence of about three years when he worked in Richards Bay, he had worked for the plaintiff since 1984, i.e. approximately 24 years. His first experience of a WDH was when he was instructed to install a ramp in his workshop for a demonstration. Crause brought the WDH to the premises for the demonstration and after the demonstration the plaintiff started manufacturing WDHs. Skelton thinks the demonstration took place in 1996. Some time later, also in 1996,

Thorburn told Skelton that problems were being experienced with the WDH. Ore was getting stuck and not discharging properly. Thorburn wanted to make the discharge opening wider so that the ore would fall out instead of being beaten out. An old WDH was brought to Skelton’s workshop. Thorburn told Skelton that the door must be made wider for discharge. Thorburn and Wilson gave Skelton instructions. The first instruction was to cut off part of the curtain and weld it to the door. Skelton cut off a section about 450-550 mm wide and welded it to the door. He then found that the wider door crashed into the remaining part of the short wall. He then cut off the remaining part of the short wall and turned it around so that there was a space for the door to swing into. It was then necessary to ensure that the door moved away from the ore and Skelton moved the pivot point to achieve this. He found that the door worked properly when he moved the pivot point to the right of the centre line. He found the best

position for the pivot point by a process of trial and error. Once he had done this he called his superior to give approval.

Skelton met Crause at the demonstration of the WDH. Crause did not play any part in the modification of the WDH. He, Skelton, would not take instructions from an outsider or a customer. He would take instructions only from Thorburn and Wilson. After receiving his initial instructions from Thorburn he regularly consulted with Jacobs.

According to Skelton he did the work during a period of two and a half to three weeks in July/August 1996.

[20] The defendant called four other witnesses, Glen Scott, a boilermaker employed by Complete Projects during 1997, Wayne Wiblin, an electrical engineer who was employed by Complete Projects during 1997, Jan van Vuuren, an engineering foreman employed by Lonmin Platinum and Johan Rossouw a manager at Lonmin Western Platinum Mine. Their evidence was not seriously challenged and it was not suggested to them that they were fabricating their evidence to support the defendant and/or Crause. Their evidence may be briefly summarised as follows –

(1) Scott

Scott was employed by Complete Projects as a boilermaker in 1997. Towards the end of May/early June 1997 Crause approached Scott to do certain work on a hopper. Crause arranged for the hopper to be taken to a smallholding leased by Complete Projects in Pretoria North. There was a small workshop there and some tools. Crause told Scott what he wanted Scott to do:

(i) cut off a piece of the short side wall (Crause indicated the piece to be cut off by drawing a line along the wall);

(ii) weld the piece of the side wall cut off onto the door of the hopper: i.e. widen the door;

(iii) move the pivot point of the door closer to the door – this was done by a process of trial and error; and

(iv) reverse the remaining part of the short side wall.

Initially, after doing the modifications the wider door would not open fully and it was necessary to move the pivot point again. After that the door opened fully.

Scott took about five days to do the modifications. Wayne Wiblin who also worked for Complete Projects, assisted him by handing him tools and helping him pick up pieces of metal.

When he had completed the work Wiblin told him that someone would collect the hopper in a day or two. A truck and driver came and loaded the modified hopper and took it away.

(2) Wiblin

Wiblin is trained as an electrical engineer but was employed as a sales representative by Complete Projects. He knows that approximately

three months after the death of Renier Crause in May 1997 Complete Projects effected modifications to a WDH. Glen Scott did most of the work. Wiblin helped him. Wiblin picked up pieces of steel and handed him tools. He did not cut or weld. Scott did the

modifications on a smallholding north of Pretoria. Complete Projects had a small workshop there. The work took about a week. Wiblin knows that the following was done to the hopper –

(i) a piece of the wall was cut off;

(ii) the piece of the wall cut off was then welded to the door;

(iii) the remaining part of the wall was turned around;

(iv) the pivot point was moved.

Crause was there. He told Scott exactly what to do – where to cut the wall, how to turn the wall and how to move the pivot point. Wiblin knew the purpose of the modification as he was involved in selling the hoppers. He saw the negative angle of the wall (after it was turned around), the widening of the door and the moving of the pivot point.

The hopper was brought to the smallholding from Western Platinum Mine.

After the work was completed Wiblin arranged for a truck to collect the hopper and take it away. He telephoned the plaintiff and arranged for this to be done. A truck came and loaded the modified hopper and took it away.

Wiblin is aware that the plaintiff modified another hopper. He went to see it tested at Number 1 Shaft Eastern Platinum Mine. Apart from Wiblin, Crause was there as well as people from the plaintiff and an engineer and other people from the mine. Wiblin saw the dolly wheel of the hopper fall off the ramp. This demonstration took place in about August/September 1997. The problem was rectified by modifying the dolly wheel and the ramp.

[21] In deciding the primary issue of who devised the invention of the patent it must be borne in mind that the witnesses were testifying about events which took place between 10 and 12 years previously, a very long time for a memory to be reliable and accurate even if there is no motive to misrepresent the facts. In the present case the dispute involves patent rights which could be worth a great deal of money. It would be naïve not to accept that the main witnesses did not have a motive to at least colour their evidence so that it would be considered more favourably. For these reasons the documentary evidence and the probabilities play a very important role in assisting the court to make findings as to the witnesses’ credibility and reliability. The documentary evidence is the most objective means of determining whether the witnesses can be believed and what they say is accurate. Depending upon the circumstances the probabilities can be equally important.

[22] The plaintiff’s case on the pleadings (as they were finally amended at the trial on 4 August 2008) is that the true inventors of the invention were Thorburn and Skelton, alternatively, Thorburn, Skelton and Crause and that they devised the invention in or about 1996. The plaintiff’s case in the evidence given at the trial in August 2008 is that Thorburn and Skelton were responsible for devising the invention, that Crause was not involved at all and that they devised the invention during a period of two and a half to three weeks during July/August 1996.

[23] This case must be considered against the background of allegations previously made by the plaintiff and its legal representatives. It is noteworthy that the plaintiff never alleged that its employees devised the invention until the plaintiff and Crause and Crause’s wife failed to negotiate a new licence agreement in respect of the WDH and the wide door WDH (the subject of the patent). Crause filed his application for the patent on 3 June 1998 and for two to three years the plaintiff failed to object to the fact that Crause had registered a patent for the invention devised by the plaintiff’s employees.

(1) On 23 February 2001, Thorburn on behalf of the plaintiff, prepared a letter ‘To whom it may concern’ to inform potential customers of the plaintiff’s interest in the relevant hopper (see para [15] (20)). While clearly intent on clarifying the extent of the plaintiff’s rights in respect of the hopper Thorburn referred only to the copyright in respect of the relevant drawings. He said nothing about the plaintiff’s rights to the patent or the invention (D56 p101);

(2) On 12 September 2001 Spoor & Fisher on behalf of the plaintiff addressed to Crause a letter in which it was alleged for a number of reasons that the patent is invalid (see para [15] (21)). The letter states (in para 2) that –

‘The alleged invention claimed in your patent was at best for you made jointly by Mr Thorburn, Mr Wilson, and yourself during various meetings at our client’s offices during about March 1998. Thus you were not entitled to apply for the patent and the patent was granted in fraud of our client’s rights’.

and (in para 3) that -

‘The alleged invention claimed in your patent was made available to the public prior to 3 June 1998 by disclosure to Mr Thorburn, Mr Wilson, and Mr Hibbert during the March 1998 meetings. Our client subsequently and prior to 3 June 1998, produced a drawing of the hopper claimed in your patent and supplied you with a quotation for manufacturing doors for converting existing hoppers to the hoppers as claimed in your patent’ (D135 p281).

The letter demanded that Crause surrender the patent.

There is no mention in this letter of Skelton who effected the modification and there is only reference to Thorburn and Wilson and how they devised the invention at meetings in March 1998.

(3) On 26 October 2001, Wilson on behalf of the plaintiff, addressed to Complete Projects (for the attention of Crause) a letter containing an offer to purchase “your patent 98/4753” for a once-off lump-sum payment. (See para [15] (22)). The letter pertinently recorded that if the offer was not accepted the plaintiff would continue to take whatever steps it had to in order to insure its continued involvement in the relevant hopper market. Significantly there was no statement that the plaintiff’s employees devised the invention to the patent and that the plaintiff and not Crause was entitled to be registered as the patentee (D76 p150);

(4) On 14 November 2001 Thorburn on behalf of the plaintiff, addressed to Ms L. Vangelatos of Anglo American a letter and a memorandum relating to the issue of who was entitled to the patent (see para [15] (23)). In the letter Thorburn apologised for the delay in sending the memorandum to her but explained that the plaintiff thought it necessary to be accurate in its statements. In the letter Thorburn states for the first time that the plaintiff claims that it is the rightful owner of the patent claimed by Crause (D79 p156). However, in the memorandum, which purports to set out how the parties devised the invention it is clear that Crause devised the invention and that the plaintiff’s complaint was that Crause did not give the plaintiff recognition for these substantial contribution made by certain (unnamed) Galison personnel. At that stage it was clear that the plaintiff saw the invention as the work of joint collaboration. The memorandum also makes it clear that the invention was devised in ‘mid 1996’. It is noteworthy that despite Thorburn’s avowed intention of accurately reflecting the facts the memorandum did not identify the ‘Galison personnel’ involved or give an exact date for the devising of the invention. Clearly, at that stage, all the information was available;

(5) On 8 February 2002 the plaintiff instituted proceedings in this court for the revocation of the patent in terms of section 61 of the Act. (See para [15] (24)). Crause was cited as the patentee. The plaintiff relied on grounds A-F for the revocation of the patent. Ground C was that the patentee was not a person entitled in terms of section 27 of the Act to apply for the patent. The statement of particulars alleges that the plaintiff’s employees, Peter Thorburn, Gary Wilson and Robert Skelton devised the claims of the patent during the course and scope of their employment with the plaintiff, that the plaintiff had not assigned the invention to the patentee and accordingly that the patentee is not a person entitled under section 27 of the Act to apply for the patent. Ground D was that the grant of the patent was in fraud of the plaintiff’s rights. The statement of particulars alleges that by virtue of the fact that the plaintiff’s employees devised the invention only the plaintiff was entitled to apply for the patent and the grant of the patent to the patentee was in fraud of the plaintiff’s rights. Ground E was that the prescribed declaration lodged in respect of the application for the patent contains a false statement which is material and which the patentee knew to be false at the time when the declaration was made. The statement of particulars alleges that the representation that the patentee is the sole inventor of the invention is a material misrepresentation and that the patentee knew when the application for the patent was filed that he was not the inventor of the invention claimed in the patent but that the plaintiff’s employees were the inventors.

(6) The plaintiff did not prosecute the proceedings for revocation of the patent.

(7) Five and a half years later, on 5 July 2007, the plaintiff instituted this action for an order in terms of section 28 of the Act, directing the defendant to assign the patent and the right to claim damages for past infringement of the patent to the plaintiff. In the particulars of claim the plaintiff alleged that the defendant is recorded in the patent register as the proprietor of the patent, that Crause is recorded in the register as the sole inventor, the applicant and the original patentee but that notwithstanding the contents of the register, the true inventors were the plaintiff’s employees, Peter Thorburn, Gary Wilson and Robert Skelton and that they invented the invention ‘in or about 1996’.

(8) Six and a half years later, in August 2008, the plaintiff amended its particulars of claim to delete the reference to Gary Wilson and to insert the alternative allegation that ‘the inventors of the invention were the plaintiff’s employees (now only Peter Thorburn and Robert Skelton) together with Crause’.

[24] (1) It is not possible to reconcile these statements and there is no explanation for the contradictions and inconsistencies which go to the heart of the dispute. At first there was no attempt to assert any right to the patent. Then in September 2001 the plaintiff’s attorney, obviously acting on instructions, alleged that Thorburn, Wilson and Crause jointly devised the invention during various meetings at the plaintiff’s offices during about March 1998. There was no mention of Skelton as an inventor and no suggestion that Crause was not involved.

(2) The plaintiff’s version changed again in November 2001 when Thorburn sent Anglo American a memorandum to explain who was entitled to the patent. Even then there was a contradiction. In his covering letter Thorburn stated that the plaintiff claims to be the rightful owner of the patent but the enclosed memorandum makes it clear that the invention was the result of the ‘joint collaboration between Galison personnel and Chris Crause’. The thrust of the memorandum is that Crause devised the invention but that the plaintiff’s personnel contributed substantially to the invention and accordingly that the plaintiff is at least entitled to be a partial proprietor of the patent. As far as the defendant is concerned this is the opposite of what the plaintiff now contends.

(3) The plaintiff’s version changed again in February 2002 when the revocation proceedings were launched. Now it was alleged that Crause had not devised the invention at all and was not entitled to be a patentee and that Thorburn, Wilson and Skelton had devised the patent and that only the plaintiff was entitled to be registered as the patentee.

(4) This continued to be the plaintiff’s version five and a half years later when the plaintiff instituted this action but a year later it changed again. Now the allegation that Wilson had participated in devising the invention was deleted and it was alleged in the alternative, that Crause also participated in devising the invention.

(5) It is astonishing that for at least six years the plaintiff consistently alleged that Wilson helped devised the invention

and at the last moment this allegation was deleted, that Skelton was not even referred to in the first formal letters and that the plaintiff contradicted itself about Crause’s role on at least two occasions.

(6) All these factors show that the plaintiff’s evidence (i.e. that of Thorburn and Skelton) is unreliable and cannot be accepted at face value. This is exacerbated by the probabilities arising out of the plaintiff’s failure to take action when apprised of the existence of the patent and by the action which the plaintiff did take.

[25] (1) Thorburn has been in the business of manufacturing mining equipment for more than 30 years during which period he has devised and registered some 70 patents. He is well-educated, an experienced businessman, knowledgeable about the value of intellectual property rights and he does not hesitate to consult patent attorneys as the documents in this case show. He is also ruthless in his quest to safeguard and protect his and/or the plaintiff’s rights. He did not hesitate to attempt to impugn Crause’s honesty and character in his, Thorburn’s, own evidence. There can be no doubt that if Thorburn considered that Crause had, in effect, stolen the rights to the invention by registering a patent in respect of which he had no rights Thorburn would have immediately confronted Crause and demanded that Crause assign the patent to the plaintiff and if necessary institute proceedings for appropriate relief. Thorburn did none of these things. The first steps to safeguard the plaintiff’s rights were taken only after it became apparent that a new licence agreement would not be entered into. Thorburn’s explanation that he thought the plaintiff was doing good business and that he was extremely busy acquiring other rights is unconvincing. In 1997 Thorburn was able to find the time to file a provisional application for the hopper with the scroll.

(2) After the plaintiff’s employees had devised the new wide door hopper which overcame the problem of discharging sticky ore, Thorburn did not have the plaintiff’s draftsman, Lee Hibbert, prepare drawings for the hopper so that Thorburn could consult a patent attorney to see whether a patent could be registered to protect the invention and the plaintiff’s rights. There is no suggestion that Thorburn consulted a patent attorney with a view to registering a patent in respect of the hopper in 1996 and there are no drawings for the hopper prepared in 1996.

(3) When the plaintiff and Elizabeth entered into the licence agreement in October 1996 no mention was made in the agreement of the new hopper and who was entitled to it. The agreement governs only the relationship of the parties in respect of WDHs. It is inconceivable that this would have happened if a new invention had been devised which overcame the discharge of the sticky ore problem.

(4) For a period of at least 18 months the plaintiff continued to do business with Complete Projects and not once during that period did the plaintiff claim that it and not Crause devised the invention to the patent.

(5) After the licence agreement with Elizabeth Crause expired on 4 December 2000 the plaintiff did not take steps immediately to challenge Crause’s right to register the patent. The plaintiff continued to manufacture and sell to Complete Projects and other purchasers WDHs and the wide door hoppers.

(6) The plaintiff did not follow up the progress of the new hopper with Crause to see how it was performing.

(7) There are no records to reflect what Skelton was doing at the plaintiff’s works for two and a half to three weeks during July/August 1996. This was obviously a specific instruction to modify the WDH and it took a great deal of time of an experienced artisan.

[26] As against these inconsistencies, contradictions and improbabilities, Crause’s evidence on the key issue was not shown to be untrue. Crause was adamant that he devised the invention in a two stage process. First, in 1995, he developed the inventive concept, which he illustrated with contemporaneous drawings. Second, in 1997, he implemented the inventive concept by making, with the assistance with Scott and Wiblin, a prototype of the wide door hopper. In this regard his evidence was corroborated by Scott and Wiblin in all material respects. Neither was shown to be untruthful and it was not suggested that they fabricated their evidence. There is also important circumstantial evidence by Jan van Vuuren and Johan Rossouw which tends to support Crause if not support him directly.

[27] There are some troubling features in Crause’s evidence. One is the delay of two years in implementing the inventive concept by producing the prototype in Pretoria North in 1997. If this was the ultimate hopper as Crause suggests it is highly improbable, if not inconceivable, that he would not have sought to exploit the invention as soon as possible. His explanation that he did not want to place too heavy a burden on his newly qualified son is not convincing. Another feature is his apparent inability to appreciate the conflict of interest between his duties as Chief Mining Inspector and as a businessman involved in selling mining equipment in the mines falling under his jurisdiction. Nevertheless, in view of the inconsistencies, contradictions and improbabilities in the plaintiff’s evidence, it will serve no purpose to analyse his evidence in detail. Even if it is held that in many respects Crause is unreliable this does not apply to his evidence on the central issue which is corroborated by other reliable evidence. There is no basis for finding that the plaintiff’s version is true and accurate and the defendant’s version is false and must be rejected. The plaintiff has therefore not discharged the onus resting on it and its claim must be dismissed.

Order

[28] The plaintiff’s claim is dismissed with costs.

_______________________

B.R. SOUTHWOOD

JUDGE OF THE HIGH COURT

CASE NO: Patent 98/4753

HEARD ON: 4 August 2008 to 15 August 2008

FOR THE PLAINTIFF: ADV. B. DU PLESSIS

INSTRUCTED BY: Mr H.R. Moubray of Spoor & Fisher

FOR THE FIRST DEFENDANT: ADV. A. BESTER

INSTRUCTED BY: McCallum Rademeyer & Freimond

DATE OF JUDGMENT: 30 January 2009