Tekno-Medical Optik Chirurgie GMBH v Registrar of Trade Marks and Another (2015/59773) [2017] ZAGPPHC 404; 2017 BIP 106 (GP) (28 July 2017)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

CASE NO: 2015/59773

Not reportable

Not of interest to other judges

Revised.

28/7/2017

In the matter between:

TEKNO – MEDICAL OPTIK CHIRURGIE GMBH Applicant

and

REGISTRAR OF TRADE MARKS First Respondent

TEKNO INSTRUMENTS AND MANUFACTURING CC Second Respondent

JUDGMENT

ADAMS J:

[1]. This is an application for the removal, cancellation and expungement from the trade mark register of a trade mark registration number 2002/0577 ‘TEKNO’ in class 10, and is brought in terms of the provisions of section 24(1) of the Trade Marks Act no 194 of 1993 (‘the Act’), as read with sections 10(3) and 10(12). In terms of paragraph 2 of the notice of motion, the applicant sought an order directing the Registrar of Trade Marks (the first respondent, who has taken no part in these proceedings) to expunge the said trade mark from the register of trade marks.

[2]. The applicant, a German company, is the manufacturer of surgical, endoscopic and dental instruments, which it sells internationally under the trade mark ‘TEKNO’. It is the registered proprietor of the ‘TEKNO’ trademark in several countries around the world. The second respondent, a South African Close Corporation, is recorded in the trade mark register as the registered proprietor of trade mark 2002/05799 ‘TEKNO’ in class 10 in respect of ‘Surgical, medical, veterinary and optical as well as endoscopic instruments and equipment’.

[3]. The matter turns on the application to the facts of the provisions of section 24(1), read with sections 10(3) and 10(12), of the Act. So far as material section 24(1) reads as follows:

‘(1) In the event of … an entry wrongly made in or wrongly remaining on the register, … any interested person may apply to the court or, at the option of the applicant and subject to the provisions of section 59, in the prescribed manner, to the registrar, for the desired relief, and thereupon the court or the registrar, as the case may be, may make such order for making, removing or varying the entry as it or he may deem fit.’

[4]. The relevant subsections of section 10 provides as follows:-

‘The following marks shall not be registered as trade marks or, if registered, shall, subject to the provisions of sections 3 and 70, be liable to be removed from the register:

(3) a mark in relation to which the applicant for registration has no bona fide claim to proprietorship;

(12) a mark which is inherently deceptive or the use of which would be likely to deceive or cause confusion, be contrary to law, be contra bonis mores, or be likely to give offence to any class of persons;’

[5]. The applicant relies on these two grounds contemplated in section 10 of the Act in support of its contention that the entry was wrongly made and wrongly remains on the register. It contends firstly that the second respondent is not the bona fide proprietor of the ‘TEKNO’ trademark and secondly that the mark is inherently deceptive and that the use thereof would be likely to deceive or cause confusion, be contrary to law, be contra bonis mores, or be likely to give offence to any class of persons.

[6]. The filing date of trade mark number 2002/05799 is the 26th April 2002 and it was registered on the 26th February 2007. The second respondent acquired the title to the trade mark registration from Tekno Surgical and Medical (Pty) Limited

(‘TSM’) in terms of a deed of assignment dated the 6th February 2013, which was recorded by the Registrar of Trade Marks on the 19th March 2013 (according to the endorsement on the register) or on the 26th June 2013 (as per the certificate of assignment).

[7]. The applicant was founded during 1976, and has since its inception used the trade mark ‘TEKNO’, albeit in different styles and formats, in relation to its goods. During 2001 the applicant launched a new version of its logo mark, ‘TK TEKNO’, which it has since used in relation to its products. The new logo has since 2001 been applied to the products, catalogues and other material of the applicant in the marketing and promotion of its goods.

[8]. The applicant’s products have been available in South Africa, through different distributors, including TSM, since before 1997. During the period 1997 to 2001 (prior to the filing date of the trade mark) sales to the applicant’s South African distributors amounted in total to €205,305.64. Applicant’s catalogues, bearing its ‘TEKNO’ trade mark, have been available in South Africa since 1997.

[9]. Up to approximately April 2002 there was in place an arrangement between the applicant and another South African close corporation, The Doctor Shop CC (‘The Doctor Shop’), an entity related to the second respondent in that its sole member during 2002 is the same person (Mr Minnie, the deponent to the second respondent’s opposing affidavits) who is the second respondent’s sole member. In terms of this arrangement, The Doctor Shop distributed or on – sold the applicant’s products in South Africa. This is evidenced by a range of invoices from the applicant to The Doctor Shop dated from the 29th August 2001 to the 19th April 2002, that is prior to the filing date of the trade mark. These invoices prove conclusively that the applicant had supplied its products to The Doctor Shop for on – sale or distribution in South Africa.

[10]. Subsequent to the 19th April 2002 The Doctor Shop was substituted in this arrangement by TSM, which thenceforth purchased from the applicant its products for distribution and / or on – sell in South Africa. For the period 2001 to 2012 the sales by the applicant of its ‘TEKNO’

products to The Doctor Shop and TSM amounted in total to €511,352.99. For the period August 2001 to April 2002 these sales to The Doctor Shop and TSM totalled an amount in excess €13,000.00. There is no doubt in my mind that as and at the filing date of the ‘TEKNO’ trade mark, being the 26th April 2002, the ‘TEKNO’ branded goods of the applicant was sold in South Africa by amongst others The Doctor Shop and TSM, both of which entities were owned and controlled by the present sole member of the second respondent.

[11]. The aforegoing, so it was contended by the applicant, demonstrates an extensive use of its trade mark in South Africa as and at the date of the filing of the trade mark on the 26th April 2002, which translates into the applicant having acquired a protectable reputation in its trade mark.

[12]. In the answering affidavit, the second respondent challenged the basis of the application for the removal of its trademark on the grounds that at the relevant times, that being the filing date of the trade mark, it was not a distributor or agent of the applicant. It sold, so it was alleged by the second respondent, products that it sourced from the applicant ‘and other suppliers’ of medical equipment on an ad hoc basis. Mr Minnie, the sole member of the second respondent, states that during August 2001 he had decided to adopt the trade mark

‘TEKNO’ for his own use in relation to a range of surgical instruments which he intended to manufacture and sell in his own name. He had decided to do so after receiving confirmation from the applicant’s sales manager that the applicant had no intention of entering the South African market. This allegation by Mr Minnie, which is denied by the applicant, is belied by the fact that the applicant, even on Mr Minnie’s version, always intended to have its ‘TEKNO’ – branded products distributed in South Africa.

[13]. It is instructive to note that, whilst Mr Minnie in his opposing affidavits makes numerous references to other suppliers of products, he does not give the name of one single such supplier. The very bald allegation is made on more than one occasion that the second respondent sells and promotes (and had at all relevant times sold and distributed) a wide range of TEKNO – branded medical equipment, sourced from various suppliers (including those other than the applicant).

[14]. The sum total of the evidence in support of the claim that the second respondent had sourced from suppliers other than the applicant ‘TEKNO’ branded products is a written missive from the applicant to Mr Minnie dated the 3rd November 2005. The contents of this letter indicate that the applicant had received from another company instruments intended for

delivery to the second respondent which originated from another company. It is alleged by Mr Minnie that the instruments mentioned in this piece of correspondence bore the ‘TEKNO’ trade mark, although it was received from a source in Germany unrelated to the applicant. However, this event occurred during 2005, which is long after the filing date, making it irrelevant to an enquiry relating to whether or not it has a bona fide claim to the proprietorship of the trade mark. In that regard, I find myself in agreement with the submission by Mr Michau, who appeared on behalf of the applicant, that the filing date of the trade mark under attack, namely the 26th April 2002, is the only relevant date. Additionally, the details relating to these goods sourced from a supplier other than the

applicant is scant and somewhat sketchy. No details are given by the second respondent of the name of the supplier, and the second

respondent failed to furnish for example an invoice or an order in respect of this consignment. As indicated below, I am not persuaded

that this seemingly isolated incident even begins to prove that the second respondent and / or Mr Minnie sold its own products bearing the ‘TEKNO’ trade mark at the relevant time – not during 2005 and certainly not during 2001 / 2002.

[15]. Some months after filing its answering affidavit, the second respondent filed a further affidavit enlarging upon its grounds of opposition. In that affidavit the first respondent explained how it applied the ‘TEKNO’ trade mark to the goods sourced from suppliers other than the applicant. The second respondent explained that it would request the supplier to etch the ‘TEKNO’ trade mark onto the medical equipment ordered, as it believed it was entitled to do as the proprietor of the registered trade mark. This is done in Germany and the goods arrive in South Africa with the mark as it appears in the Trade Mark Register. Implicit in this explanation is the fact that this was the process followed by the second respondent post – filing date of the trade mark. Again the particulars of these alleged suppliers are scant to the point of being non – existent. The second respondent omits to furnish any particulars relating to the names of these alleged suppliers and does not support its claim by providing documentary proof in the form of, for example, tax invoices, order forms or bills of laden. The irresistible conclusion to be drawn from this is that there were no such other suppliers. Importantly, there is no evidence before me suggesting anything other than the fact that the ‘TEKNO’ branded goods sold by the second respondent were in fact those of the applicant, as contended by the applicant, who backs up the submission with objective documentary proof.

[16]. Mr Minnie also reiterated the point that he and the second respondent were and are of the bona fide belief that they were entitled to adopt the ‘TEKNO’ trade mark in South Africa. He based this belief on his interaction with the applicant and several of its employees. The applicant, so it is contended by Mr Minnie in the further affidavit, has never denied that the second respondent is the owner of the ‘TEKNO’ trade mark in South Africa, despite the fact that it (the applicant) had been aware since before 2007 of the second respondent’s filing of the registration of the trade mark. For a period of approximately 5 years the applicant did not object to the second respondent’s use of the trade nor did it

indicate to the second respondent during that period that it was not entitled to use the mark, as it had been doing as the registered

proprietor thereof. In fact, so it is further submitted by Mr Minnie, the applicant expressly represented that it consented to him and the second respondent using the ‘TEKNO’ trade mark as it had been doing during the period from 2007 to 2012, and even before that, for example during November 2005 when the applicant became aware of the fact that TSM was sourcing ‘TEKNO’ branded products from suppliers other than the applicant, it raised no objection to such use.

[17]. Mr Minnie maintains furthermore that, as evidenced by the minutes of a meeting held on the 1st of December 2006 between him and representatives of the applicant, it (the applicant) was aware of the use by him of the trade mark and had in fact expressly represented to him that the applicant is satisfied that he continue the use of the ‘TEKNO’ trade mark. There was also discussions between the parties on the basis that the applicant had accepted that Mr Minnie and / or the second respondent was the owner of the ‘TEKNO’ trade mark in South Africa. This impression created in the mind of Mr Minnie by the conduct of the applicant, according to him, lasted until July 2012.

[18]. This, according to Mr Minnie, means that the conduct and representations of the applicant had created in his mind a bona fide belief that he was entitled to apply for the ‘TEKNO’ trade mark. Not once in a period of approximately 10 years, so the contention on behalf of the second respondent is developed, was any objection raised to the use of the mark in South Africa nor to the registration thereof, which induced him to continue the use of the mark. This, so the argument is concluded, means that the applicant is precluded by its acquiescence, alternatively, waiver of its rights from obtaining the relief sought in this application.

[19]. In sum, the second respondent seeks to introduce the defence of estoppel, alternatively, waiver in the further affidavits.

[20]. Shortly before the hearing of this application, the second respondent filed an ‘interlocutory’ application to have referred to oral evidence two issues, namely who the bona fide proprietor of the ‘TEKNO’ trade mark is and whether there was an agreement between the applicant and the second respondent in terms of which the second respondent used the ‘TEKNO’ trade mark as a distributor of the applicant, as alleged by it. In the affidavit in support of this interlocutory application the second respondent asserts finally that at a meeting between Mr Minnie and certain representatives of the applicant on the 29th March 2012 the impression created by the applicant was that Mr Minnie was indeed entitled to adopt the ‘TEKNO’ trade mark in South Africa as his own. At this meeting it was also indicated that the applicant is merely a supplier of instruments and not the originator of the ‘TEKNO’ trade mark in South Africa. Mr Minnie therefore contends that he and the second respondent has since 2001 gained the reputation in the ‘TEKNO’ trademark, which gives it a bona fide claim to proprietorship and thus its application for registration was made in good faith. In the words of Mr Minnie: ‘The origin and consequently, the reputation, in the ‘TEKNO’ trade mark lies with me’. These averments were made in the context of an application for the admission of further evidence, namely a recording of the meeting

between Mr Minnie and certain representatives of the applicant on the 29th March 2012. The affidavit did however give a summary of the recording, presumably as interpreted by Mr Minnie, as indicated above. The minutes of this meeting was in any event attached as an annexure to the answering affidavit of the second respondent in the

main application.

[21]. I am of the view that the second respondent should be granted leave to admit the further evidence as contained in the further affidavit in support of the application for referral to oral evidence. However, I do not believe that it is necessary to have the recording admitted. In my view, it would add nothing to the factual matrix in this matter. For purposes of this judgment I am prepared to accept that it is the second respondent’s case that at the meeting on the 29th March 2012 the applicant had created the impression that Mr Minnie was entitled to adopt the ‘TEKNO’ trade mark in South Africa as his own.

[22]. I do not however accept this version.

[23]. In Plascon – Evans v Van Riebeeck Paints, 1984 (3) 623 (AD), the principles relative to the assessment of factual issues in motion proceedings are set out as follows at pg 634:

‘It is correct that, where in proceedings on notice of motion disputes of fact have arisen on the affidavits, a final order, whether it be an interdict or some other form of relief, may be granted if those facts averred in the applicant's affidavits which have been admitted by the respondent, together with the facts alleged by the respondent, justify such an order. The power of the Court to give such final relief on the papers before it is, however, not confined to such a situation. In certain instances the denial by respondent of a fact alleged by the applicant may not be such as to raise a real, genuine or bona fide dispute of fact (see in this regard Room Hire Co (Pty) Ltd v Jeppe Street Mansions (Pty) Ltd, 1949 (3) SA 1155 (T) at 1163 - 5; Da Mata v Otto NO, 1972 (3) SA 858 (A) at 882D - H). If in such a case the respondent has not availed himself of his right to apply for the deponents concerned to be called for cross-examination

under Rule 6 (5) (g) of the Uniform Rules of Court (cf Petersen v Cuthbert & Co Ltd, 1945 AD 420 at 428; Room Hire case supra at 1164) and the Court is satisfied as to the inherent credibility of the applicant's factual averment, it may proceed on the basis of the correctness thereof and include this fact among those upon which it determines whether the applicant is entitled to the final relief which he seeks (see eg Rikhoto v East Rand Administration Board and Another, 1983 (4) SA 278 (W) at 283E - H). Moreover, there may be exceptions to this general rule, as, for example, where the allegations or denials of the respondent are so far-fetched or clearly untenable that the Court is justified in rejecting them merely on the papers (see the remarks of BOTHA AJA in the Associated South African Bakeries case, supra at 924A).

[24]. Applying these principles to the present case, I am of the view that the second respondent’s version is far – fetched and clearly untenable and should be rejected on the papers. The fact of the matter is that for a period of approximately 11 years from 2001 to 2012 the applicant supplied to the second respondent and its predecessors its ‘TEKNO’ branded products to the value of €511,352.99 for distribution or on – sell in South Africa. Furthermore, on the 17th April 2002, TSM, the predecessor of the second respondent, in writing requested the applicant to confirm to an end user in South Africa that ‘The Doctor Shop is the sole agent / distributor in South Africa for Tekno Medical – Germany’ and that ‘As from 1 May 2002 all Tekno Products (Germany) will be distributed by Tekno Surgical & Medical (Pty) Limited (South Africa)’. In the face of these uncontroverted facts, the second respondent’s claim that the applicant has consented to the adoption of the ‘TEKNO’ trade mark in South Africa by Mr Minnie is not sustainable and stands to be rejected on paper. In addition, other than the ipse dixit of Mr Minnie that he had adopted the ‘TEKNO’ trade mark and used it by requiring his German suppliers (other than the applicant) to etch the trade mark onto his products, which he would then sell in South Africa, there is not one iota of evidence in support of this claim.

[25]. As regards the application for the referral to oral evidence in respect of the two issues, I am of the view that it would not be in the interest of justice to grant this request. The first issue relating to who the bona fide proprietor of the ‘TEKNO’ trade mark is a factual issue which can easily be dealt with, as I do below, on the basis of the principles enunciated in the Plascon – Evans case (supra). There is therefore no need, in my view, to refer this aspect to oral evidence. The second issue relative to whether the second respondent, its predecessor and Mr Minnie were distributors of the applicant’s ‘TEKNO’ branded products is irrelevant. In that regard, I have already indicated that it is common cause that the second respondent and its predecessors had over a period of approximately 11 years, including during a period from August 2001 to April 2002, acquired from the applicant its products for distribution or on – sell in South Africa. I find myself in agreement with the submission made by Michau that the exact relationship between the second respondent’s predecessors and the applicant is irrelevant. I will deal with this issue in more detail below.

[26]. The application for referral to oral evidence therefore fails.

[27]. I think it may be convenient at this point to deal with the defences of acquiescence, estoppel or waiver raised by the second respondent somewhat belatedly.

[28]. As indicated above the second respondent has raised the defences of tacit waiver (through silence or a failure to act in the face of a legal duty to do so) and acquiescence, on the part of the applicant. The second respondent also raised the defence of estoppel based upon an implied representation made by the applicant as a result of a failure to act in preventing the second respondent and / or Mr Minnie from continuing to use the contested trade mark.

[29]. The basis for these defences is the allegation by the second respondent that the applicant was aware of TMS’s use of the ‘TEKNO’ trade mark from about 2007, but only took action some 5 years later during July 2012 when the applicant caused a letter of demand to be addressed to TMS, demanding that it cancels the ‘TEKNO’ trade mark. The applicant, so it is contended by the second respondent, expressly represented to TMS that it (the applicant) consented to the use by TMS of the mark in the manner it has been doing. The evidence presented by the second respondent in support of this contention is the agreement reached at a meeting on the 1st December 2006 in Germany between Mr Minnie and 3 representatives of the applicant. The minutes of this meeting record that TMS agreed to ‘grant permission to ABS to use the name TEKNO in the medical field for an initial period of 24 months’. Furthermore, at meetings between Mr Minnie and the representatives of the applicant on the 18th and 22nd February 2008, the applicant attempted to negotiate a purchase from TMS of the ‘TEKNO’ trade mark from TMS. The second

respondent contends that these negotiations were conducted on the basis that the applicant accepts that TMS was the owner of the trade mark. In any event, the mere fact of the negotiations was a representation by the applicant which created, so Mr Minnie alleges,

in his mind a belief that the applicant has consented to the use by him of his registered trade mark.

[30]. I will deal firstly with the defence of acquiescence, which, in my view, does not form part of our law. In that regard see: Societe Des Produits Nestle SA and Another v International Foodstuffs Co and Others, (100/2014) [2014] ZASCA 187; [2015] 1 All SA 492 (SCA); and Turbek Trading CC v A & D Spitz Ltd and Another, (565/08) [2009] ZASCA 158; [2010] 2 All SA 284 (SCA). That defence accordingly does not assist nor avail the second respondent.

[31]. As regards the applicant’s alleged representation that it consented to the use of the ‘TEKNO’ trade mark by TSM by it not objecting to the use and by its attempts to purchase the trade mark from Mr Minnie, the response by the applicant is simply this: The applicant had known for a number of years that TSM had filed its application for the registration of the trade mark. During that time, the applicant attempted to resolve the issue practically and amicably with Mr Minnie. At some stage there

was a proposal that TSM assigns to the applicant the registered trade mark. This, so the applicant contends, does not mean that it has consented to the use by Mr Minnie of the trade mark.

[32]. On a conspectus of all of the evidence I am satisfied that Mr Minnie and the second respondent was never led to believe that the applicant would not enforce the contested trade marks in South Africa against the second respondent. The conduct of the applicant never unequivocally indicated a waiver of the rights it held in the contested trade mark, nor did it amount to a representation that action would not be taken against the second respondent to enforce these rights.

[33]. For these reasons, the defences of waiver and estoppel must fail.

[34]. Against this background I proceed to consider the real issues between the parties and that is whether the second respondent’s predecessor – in – title had, as at the 26th April 2002 (the date of TSM’s application for the registration), an existing right in the ‘TEKNO’ trade mark in class 10, in that it had a bona fide claim to proprietorship in respect of the mark. Also, whether the applicant at the relevant time had acquired a protectable reputation in the trade mark ‘TEKNO’.

[35]. The question is whether the mark ‘TEKNO’ formed part of TSM’s goodwill. The applicant had to show that it, and not TSM, was at the filing date the proprietor of the ‘TEKNO’ trade mark, and this required proof that the applicant, and not TSM, ‘originated, acquired or adopted it and has used it to the extent that it has gained the reputation as indicating that the goods in relation to which it is used’ belonged to the applicant. (Moorgate Tobacco Co Ltd v Philip Morris Inc – a trade mark determination by Hon WG Trollip referred to inter alia by Southwood J in Butterworths Publishers (Pty) Ltd v Jacobsens Group (Pty) Ltd [2005] 2 All SA 588 (T) para 34). As Colman J explained, extensive use creates the intangible property rights in an unregistered (common – law) trade mark (Oils International (Pty) Ltd v Wm Penn Oils Ltd, 1965 (3) SA 64 (T) 70G). In other words, the applicant had to discharge the same onus in relation to reputation that it would have had under a passing-off claim (Adcock-Ingram Products Ltd v Beecham SA (Pty) Ltd, 1977 (2) SA 434 (W) 436H-437E; Caterham Car Sales & Coachworks Ltd v Birkin Cars (Pty) Ltd, [1998] ZASCA 44; 1998 (3) SA 938 (SCA) para 16 and 21-22).

[36]. The term 'proprietorship' is not defined in the Act. In Victoria's Secret Inc v Edgars Stores Ltd, [1994] ZASCA 43; 1994 (3) SA 739 (A) it was held that the word 'proprietor' as used in the Act does not import common – law ownership of the trademark but is used in the sense of 'one who has the exclusive right or title to the use' of it. One can claim to be the proprietor of a trademark if one has appropriated a mark for use in relation to goods or services for the purposes stated, and so used it. The word 'appropriate' in this context comprehends 'originate', 'acquire' and 'adopt'.

[37]. There is no objective evidence of use of the trade mark ‘TEKNO’ by TSM prior to the effective date of its application, namely 26th April 2002, other than as a distributor of the applicant’s products. One cannot rely simply on the uncorroborated allegations

made on behalf of the second respondent by Mr Minnie. The allegation under oath that Mr Minnie had decided ‘during or about August 2001 to adopt the trade mark ‘TEKNO’ for my own use in relation to a range of surgical instruments that I was intending to manufacture and / or sell in my own name’, is singularly unimpressive if contrasted against the unequivocal evidence of the applicant, corroborated by objective documentary

proof, that for a considerable period of time the applicant had supplied to the predecessors of the second respondent its products

bearing the ‘TEKNO’ mark, which they (The Doctor Shop and TSM) distributed and / or on – sold in the Republic of South Africa. This claim also appears to me to be contrived and in conflict with the probabilities that flow from the transactions concluded between the applicant, The Doctor Shop and TSM during that period being about April 2002, as well as having regard to the fact that Mr Minnie had requested the applicant at the time to confirm that The Doctor Shop and TSM were the ‘sole agents / distributors in South Africa of Tekno – Medical Germany’.

[38]. With regard to the second respondent’s claim to proprietorship, the evidence of its use of the mark in South Africa is clear and unequivocal that prior to April 2002, the predecessors of the second respondent, The Doctor Shop and TSM, made use of the ‘TEKNO’ mark as distributors in South Africa of the applicant’s products.

[39]. To have a bona fide claim to proprietorship an applicant for registration of a mark in use must claim, in good faith, to be entitled to be registered as proprietor of the mark, and if the mark is not in use, the applicant can make such a claim if he has a sufficiently present and unconditional intention to use the mark - see P Lorillaird Co v Rembrandt Tobacco Co Ltd 1967, (4) SA 353 (T) at 356F-G. In casu, the trade mark was by all accounts in use by the applicant.

[40]. The second respondent does not claim to have originated or appropriated the mark ‘TEKNO’. The second respondent claims to have acquired it. To have a bona fide claim to proprietorship of the mark when it applied to register the trade mark in 2002, the second respondent would have had to establish that it had acquired the exclusive right or title to the use of the mark in relation to the goods or services in respect of which it sought registration and that it had so used it to the extent that the mark had gained a reputation as indicating that the goods or services in relation to which the mark was used were those of the second respondent. The second respondent has failed to establish these facts. On the contrary, it is clear that at all material time the applicant used the mark in relation to its business and its products and that it continued to do this after 2002. The second respondent therefore could not claim in good faith to be registered as proprietor of the mark.

[41]. Mr Michau has submitted that it is a basic tenet of trade mark law that an importer and distributor of products, or a person who otherwise sells the goods of another, can never claim to be the proprietor of the trade mark depicted on the products that it imports but that such proprietorship remains with the principal. I agree. In Frank Hirsch (Pty) Limited v Roopandand Brothers (Pty) Limited, 1987(3) SA 165 (D), Page J has this to say:

‘The task of a distributor in establishing the requisite reputation in a mark which is also the mark of the manufacturer is a difficult one. An agent or distributor who merely imports and sells goods manufactured by another without adding anything to the mark under

which they are manufactured, does not thereby acquire any reputation in the mark: for the mark acquires a reputation as indicating that the goods emanate from that particular manufacturing provenance and not that they were imported and distributed by that particular agent or distributor. See Kinemas Ltd v African Theatres Ltd, 1928 WLD 100; Rusmarc SA (Pty) Ltd v Hemdon Enterprises (Pty) Ltd, 1975 (4) SA 626 (W) at 632 - 4 (applying Dental Manufacturing Co Ltd v C de Trey & Co, [1912] 3 KB 76); Roamer Watch Co SA and Another v African Textile Distributors also t/a M K Patel Wholesale Merchants and Direct Importers, 1980 (2) SA 254 (W) at 264F; Agriplas (Pty) Ltd and Others v Andrag & Sons (Pty) Ltd, 1981 (4) SA 873 (C) at 890B; Easyfind International (SA) (Pty) Ltd v Instaplan Holdings and Another, 1983 (3) SA 917 (W) at 921 - 2.’

[42]. The applicant has therefore, in my judgment, established that the second respondent had no bona fide claim to proprietorship for the trade mark when it applied for registration and the applicant is entitled to an order for the expungement of the mark.

[43]. This conclusion makes it unnecessary to consider in detail the other ground for expungement, save to say that in my view it has merit. The attack against a registered trade mark based on the provisions of section 10(12) of the Act is similar to a case based on common law passing off.

[44]. In a passing off application the applicant is required firstly to establish his reputation in the trade mark. See: Adcock – Ingram Products Limited v Beecham SA (Pty) Limited, 1977(4) SA 434 (A). The applicant has presented undisputed evidence that for the period 2001 to 2012 it has sold its ‘TEKNO’ branded products to the total value in excess of €500,000.00. I am of the view that this demonstrates conclusively that the applicant has established a reputation in the said trade mark. Secondly, the applicant is required to show a likelihood of deception or confusion. In that regard see the Adcock – Ingram case (supra). In my mind there can be no doubt that this likelihood exist. The names used are identical.

[45]. I am therefore satisfied that the applicant has demonstrated that the trade mark should be expunged on the basis of section 10(13) as well.

[46]. In the result the registrar should not have registered the trademark on the grounds that TMS had no bona fide claim to proprietorship, that the mark is inherently deceptive and that its use was likely to deceive or cause confusion. The applicant is accordingly entitled to an order in terms of section 24(1) of the Act removing the wrongly made entry from the register.

order:

Accordingly, I make the following order:-

1. The second respondent's application to admit further evidence in the form of the tape recording is refused with cost;

2. The second respondent’s application to have the matter referred to trial, alternatively, to oral evidence on 2 specified issues, is refused with cost.

3. In terms of section 24(1), read with sections 10(3) and 10(12), of the Trade Marks Act, number 194 of 1993, trade mark registration no 2002/05799 ‘TEKNO’ in class 10 in the name of Tekno Instruments & Manufacturing CC, in relation to all goods for which it is registered, be and is hereby cancelled, removed and expunged from the Trade Marks Register.

4. The first respondent is directed to remove trade mark registration no 2002/05799 ‘TEKNO’ in class 10 in the name of Tekno Instruments & Manufacturing CC, from the register of trade marks pursuant to order (3) above.

5. The second respondent shall pay the applicant’s cost of this application, including the cost consequent upon the employment of Senior Counsel.

_________________________________

L ADAMS

Judge of the High Court

Gauteng Division, Pretoria

HEARD ON: 7th June 2017 JUDGMENT DATE: 28th July 2017 FOR THE APPLICANT: Adv R Michau SC NSTRUCTED BY: Adams & Adams FOR THE SECOND RESPONDENT: Adv H Worthington INSTRUCTED BY: Hahn & Hahn