CIVIL APPEAL NO 63 OF 2021 DOUBLE DIAMOND HOLDINGS LTD V EAST AFRICAN SPIRITS LT OTHER

IN THE COURT OF APPEAL OF TANZANIA AT ARUSHA (CORAM: MUGASHA. J.A., LEVIRA. 3.A. And MAKUNGU. J.A.^ CIVIL APPEAL NO. 63 OF 2021 DOUBLE DIAMOND HOLDINGS LIMITED.... APPELLANT VERSUS EAST AFRICAN SPIRITS (T) LIMITED .1st RESPONDENT GAKI INVESTMENT LIMITED............. 2nd RESPONDENT (Appeal from the Judgment and Decree of the High Court of Tanzania, Commercial Division at Arusha) (Fikirini. 3.^ dated the 12th day of March, 2020 in Commercial Case No. 8 of 2018 RULING OF THE COURT 9hJuly 2024 MUGASHA. J.A.: The appellant is challenging the decision of the High Court of Tanzania (Commercial division) in Commercial Case No. 8 of 2018. She sued the respondents claiming to be paid a sum of TZS. 235,388,558.00, being compensation for the infringement of trade and service marks and passing off her goods. It was averred by the appellant in the amended plaint that, she was the manufacturer, supplier, and seller of gin and that, the first respondent was as well, the manufacturer, supplier, and seller of spirits. For trademark purposes, the goods manufactured, supplied, and sold by l both the appellant and the first respondent belonged to the same class, which is class 33 of trademark classification in Tanzania. In that regard, sphere of activities and market of both the appellant and the first respondent were the same. However, the appellant claimed to be the proprietor of the trademark "CHASE THE ACE THE ACE OF DIAMONDS" with registration number TZ/T/2016/2773 in class 33 in respect of Alcoholic Beverages as of 05/12/2016 which was continuously used by it as the trademark and adopted a get-up and packaging that not only reflects his registered trademark, but distinguished its goods from other goods in the market which fall under the same class 33. It was further averred by the appellant, after the registration and introduction of the trademark into the market in a get-up, the second respondent erroneously, applied for registration of trademark "WHITE DIAMOND" and DIAMOND ROCK" which was similar to that of the registered trademark of the appellant. The purported registration of the trademark "WHITE DIAMOND" was accepted while the registration of "DIAMOND ROCK" was conditionally accepted. When the appellant perused the files maintained by the Registrar of Trade and Service Marks, it appeared that the second respondent had never communicated willingness to continue with the registration of the said trademark by the 2 name "DIAMOND ROCK" on the terms and conditions set by the Registrar. The appellant averred that, since the appellant's trademark had already been registered when the application for registration of the trademarks "WHITE DIAMOND" and "DIAMOND ROCK" was done, the registration of the trademark "WHITE DIAMOND" in the name of the second respondent and acceptance of the registration of the trademark "DIAMOND ROCK" on condition that is associated with the trademark "WHITE DIAMOND" was invalid. It was further averred that, owing to the similarity of goods, confusion was bound to occur in the market. As such, since there was a material link in the course of trade between the first respondent's goods and the appellant's trademarks and get-up, uneducated, illiterate, and unaware customers were capable of being deceived, confused, or misled by the first respondent's get-up and trademark. On that account, the appellant claimed that, the first respondent had gained unfair commercial advantage by using the getup similar to the appellant's get up and registered trademark a fact that has led to the loss of business worth TZS.235,288,558.00 as earlier stated. On those allegations, the appellant sought for the following declaratory orders: 3 "1. Declaration that registration o f the trademark "White Diamond: in the name o f the 2nd defendant and its subsequent assignment to the 1st defendant is null and void; 2. Declaration that registration o f the trademark "Diamond Rock" in the name o f the 1st defendant as an associate mark o f the trademark "white Diamond"is null and void. 3. Rectification o f the Trade and Service Marks Register by deleting from the Trade and Service Marks Register the trademarks "White Diamond" and "Diamond Rock" registered under Nos. TZ/T/2017/2209 and TZ/T/2017/2210 respectively; 4. Declaration that the first defendant has infringed the plaintiffs trademark and passed - o ff her goods; 5. An order for perpetual injunction restraining the defendants, their officers, servants, or agents from displaying, marketing, and offering for sale goods in a get-up that is similar to the plaintiffs' get-up and registered trademark number TZ/T/2016/2773; 6. An order for payment o f Tzs. 235,388,558/= as compensation for loss o f business caused by the diversion o f the plaintiffs customers to the 1st defendant as the result o f the 1st defendant's misrepresentation On their part, both respondents in their joint written statement of defence denied each allegation leveled against them by the appellant. They among other things, contended that the first respondent is the sole lawful registered and bonafide proprietor in Tanzania and its associates elsewhere of numerous trademarks incorporating the word "DIAMOND" like the "THE WHITE DIAMOND" and DIAMOND ROCK" with registration number TZ/T/2017/2209 and TZ/T/2017/2210 respectively, was validly registered by the Registrar of Trade and Service Marks effective from 26/10/2017 without being opposed. Moreover, it was the respondents' contention that, the Diamonds trademarks have been extensively used by the respondents to market their goods in a distinctive package design depicted in a special form since 2017 and it was adopted for the specific purpose of identifying and distinguishing their goods from those of other traders. Thus, it was the respondents' averment that they enjoy exclusive right to use the registered trademark in respect of the goods in question and have an absolute defence against the purported claims of trademark infringement. After a full trial the suit was dismissed. This aggrieved the appellant who has preferred 5 an appeal before the Court. On account of what is to be unveiled in due course we shall not reproduce the grounds of appeal. When the appeal was called on for hearing, the appellant had the services of Mr. Salimu Mushi, learned counsel whereas Messrs. August Nemes Mrema and Jacktone Oyugi, learned counsel appeared for the respondents. At the outset, we invited parties to address propriety on the non­ joinder of the Registrar of Trade and Service Marks in the wake of the provisions of section 52 (1) of the Trade and Service Marks Act [CAP 326 R.E 2002] (the Trade and Service Marks Act) which prescribes the Registrar's right of appearance in any related legal proceedings. On taking the floor, Mr. Mushi submitted that, since the High Court is mandated to determine disputes relating to the Trade and Service Marks, the non-joinder of the Registrar was not fatal. Instead, he argued, it was upon the trial court to invoke section 52 (2) of the Trade and Service Marks Act, summon the Registrar as a witness so as to enable him/her to file a report. He added that, since it is the appellant's complaint in this appeal that the trial court did not summon the Registrar, the appeal should be heard and determined. 6 On the other hand, Mr. Mrema submitted that the non-joinder of the Registrar is fatal given that, section 52 (1) of the Trade and Service Marks Act, was contravened and considering that under Rule 97 of the Trade and Service Marks Regulations, every application before the court shall be served on the Registrar. He concluded that, on account of non­ joinder as a necessary party, the Registrar was denied a right to be heard. He then urged us to nullify the judgment and the trial proceedings. In rejoinder, on the way forward, Mr. Mushi halfheartedly urged us to quash the Judgment and direct that the Registrar be as well, heard at the trial. Looking at the pleadings of the parties, the appellant's claim hinges on the infringement of its registered trademark and passing off her goods by the respondents who also claim to have exclusive right to use its registered trademark in respect of the goods in question. In this regard, before the High Court, the appellant had invited it make declaratory orders on among others, the following, one, that registration of the trademark "White Diamond: in the name of the 2nd defendant and its subsequent assignment to the 1st defendant is null and void; two, that registration of the trademark "Diamond Rock" in the name of the 1st defendant as an associate mark of the trademark "white Diamond" is 7 null and void; three, rectification of the Trade and Service Marks Register by deleting from the Trade and Service Marks Register the trademarks "White Diamond" and "Diamond Rock" registered under Nos. TZ/T/2017/2209 and TZ/T/2017/2210, respectively. In this regard, besides the appellant seeking to have registration of the respondents' trade mark annulled, sought for an order for rectification of the Trade and Service Marks Register by expunging from the register the trademarks "WHITE DIAMOND and DIAMOND ROCK" registered under Nos. TZ/T2017/2209 and TZ/T/2017/2210. Given the nature of the dispute and subject of appeal, a follow up question is whether a fair and conclusive determination of the dispute between the parties could be attained without impleading the Registrar who is the custodian of the Register of Trade and Service Marks who is custodian of the respective register and among other things, is mandated to register trade and service marks and make rectifications where need arises. Our answer is in the negative and we shall give reasons. Before the High Court, the appellant sought orders seeking annulment of the trademarkalleged to have been infringed by the respondents and a remedy ofsubsequent rectification of the Trade and Service Marks register. In the premises, the Registrar ought to have 8 been joined as a necessary party to enable a fair and conclusive determination of the dispute before the High Court. However, as this was not the case, this offended the dictates of the provisions of section 52 (1) of the Trade and Service Marks Act which stipulates as follows: "52. (1) In any legal proceeding in which the relief sought includes alteration or rectification o f the register, the Registrar shall have the right to appear and be heard, and shall appear if so, directed by the Court". However, from what was submitted by Mr. Mushi, it would appear the appellant was not willing to join the Registrar and instead, he was of the view that, it was upon the trial court to summon the Registrar as a witness in terms of section 52 (2) of the Trade and Service Marks Act, so that the Registrar could file a report. The said provisions stipulate as follows: "52 (2) Unless otherwise directed by the court, the Registrar in lieu o f appearing and being heard, may submit to the court a statement in writing, signed by him, giving particulars o f any proceedings before him in relation to the matter in issue or o f the grounds o f any decision given by him effecting it or o f the practice o f the Trade and service Marks Office in 9 like cases or o f such other matters relevant to issues and within his knowledge as Registrar, as he deems % and the statement shall be deemed to form part o f the evidence in the proceeding". We are aware that, under the cited provision, instead of ordering appearance of the Registrar, the court has discretion to order the Registrar to submit a statement so as to give particulars of any proceedings before him in relation to the practice of the Trade and service deemed to form part of the evidence in the proceedings. However, since the Registrar who was not served with a copy of the suit as required by rule 97 of the Trade and Service Marks Regulations was unaware of what transpired before the trial court. Thus, besides, not being heard, he could not file a statement pursuant to section 52 (1) of the Trade and Service Marks Act. Under the circumstances of this case, it was prudent on the part of the learned Judge of the High Court to scrutinize the pleadingsandthe lawin order to satisfy itself on the necessity of making an order that the Registrar either be served with the pleadings or be joined as a necessary party in the context of Order 1 rule 10(2) of the Civil Procedure Code [CAP 33 R.E 2002]. This was underscored in the case of FARIDA 10 MBARAKA AND FARID AHMED MBARAKA VS DOMINA KAGARUKI, Civil Appeal No. 136 of 2006, the Court said: "Under this rule, a person may be added as a party to a suit (i) when he ought to have been joined as plaintiff or defendant and is notjoined so; or (ii) when; without his presence, the questions in the suit cannot be completely decided". See also the case of NUTA PRESS LIMITED VS MAC HOLDINGS AND ANOTHER, Civil Appeal No.80 of 2016, and TANGA GAS DISTRIBUTORS LTD VS MOHAMED SALIM SAID AND TWO OTHERS, Civil Revision No. 6 of 2011 (both unreported). As earlier stated, as discerned from Mr. Mushi's submission before us, the appellant seemed not willing to join the Registrar. Itis settled law that, once the court discovers that a necessary party has not been joined in the suit and neither party is willing to have such party joined, it is incumbent on the court to have such party added for the purpose of having a fair and conclusive determination of the dispute before that court. See: TANGA GAS DISTRIBUTORS LTD VS MOHAMED SALIM SAID AND TWO OTHERS (supra). In the circumstances, given the nature of the case whereby reliefs were sought against the Registrar who was accused to have registered the Trade and Service Mark of the respondents which was similar to that of the appellant, the learned trial Judge ought to have required the parties to amend the pleadings and join the Registrar. See: TANZANIA RAILWAYS CORPORATION (TRC) VS GBP (T) LIMITED, Civil Appeal No. 218 of 2020 (unreported). In the event the Registrar was not heard on the way forward, both learned counsel were at one that the trial was vitiated and that the resulting judgment be nullified and the case file be returned to the High Court with a direction that the Registrar be joined in the matter. As earlier stated, on the part of Mr. Mushi, his submission was made halfheartedly as he believed that, the appeal should he heard and determined. In the Memorandum of appeal, the appellant is faulting the infringement of its trade and service mark by the respondents occasioned by the alleged registration by the Registrar. Thus, the appellant is seeking to have the decision of the Registrar reversed whereas the Registrar has never been heard. This would be condoning unheard condemnation of the Registrar which is contrary to a 12 fundamental right as articulated under Article 13 (6) (a) of the Constitution of the United Republic of 1977. The right of a party to be heard before adverse action or decision is taken against such a party is so basic that a decision that is arrived at in violation of it will be nullified, even if the same decision would have been reached had the party been heard because the violation is considered to be a breach of natural justice. See: ABBAS SHERALLY & ANOTHER VS ABDUL SULTAN HAJI MOHAMED FAZALBOY, Civil Application No. 33 of 2002 (unreported). Yet, in the case of the BANK OF TANZANIA VS SAID A. MARIN DA AND OTHERS, Civil Application No. 74 of 1998 (unreported) the Court emphasized that, failure to afford an opportunity of being heard by a necessary party vitiates the proceedings. In the light of the stated position of the law which frowns on unheard condemnation, it will be absurd for this Court to make orders against the Registrar as sought by the appellant without availing the Registrar an opportunity to be heard. Thus, on account of what we have endeavoured to discuss, the non-joinder of the Registrar was a fundamental omission and occasioned a miscarriage of justice which cannot be condoned by this Court by hearing and determining the appeal. In the premises, the trial was vitiated and impugned judgment 13 and respective proceedings cannot be spared and are accordingly nullified. On the way forward, we invoke revision powers under section 4 (2) of the Appellate Jurisdiction Act [CAP 141 R.E.2019] and hereby quash and set aside the trial proceedings and the impugned judgment together with the subsequent orders. We direct the case file to be returned to the High Court for an expedited trial prior to which parties should be required to amend the pleadings and join the Registrar. Since the issue for consideration was raise suo motuby the Court, we make no order as to costs. DATED at ARUSHA this 9th day of July, 2024. S. E. A. MUGASHA JUSTICE OF APPEAL M. C. LEVIRA JUSTICE OF APPEAL 0. 0. MAKUNGU JUSTICE OF APPEAL The Ruling delivered this 9th day of July, 2024 in the presence of Mr. Rodgers Mlacha holding brief for Mr. Salum Mushi, learned counsel for the appellant and Mr. Asubuhi Yoyo, learned counsel for the Respondents, is hereby certified as a true copy of the original. <0^ F/APMTARANIA flEPUTY REGISTRAR -COURT OF APPEAL