CIV

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM rCORAMi LILA. J.A.. MAIGE. J.A. And MURUKE. J.A.1 CIVIL APPEAL NO. 210 OF 2022 RIG CO. LIMITED .................................................................. APPELLANT VERSUS WATERCOM TANZANIA LIMITED...................................... RESPONDENT (Appeal from the judgment and decree of the High Court of Tanzania at Dar es Salaam) fDe-Mello. J.l dated the 1st day of April, 2021 in Civil Case No. 159 of 2018 JUDGMENT OF THE COURT 21st March & 11th April, 2025 MAIGE. 3.A.: The appellant herein is the proprietor of a trademark comprising of the words "Rig Afya Natural Drinking water" which was registered on 15th March, 2016 in class 32 in respect of pure drinking water. In this appeal, she is being represented by Mr. Gabriel Simon Mnyele, learned advocate assisted by Mr. Roman Selasini Lamwai, also learned advocate. Conversely, the respondent is the proprietor of a trademark comprising of the words "AFYA" which was registered on 4th May, 2017 in class 32 in respect of soft drinks and carbonated water. In the conduct of this l appeal, she is being represented by a team of three learned advocates namely; Mr. Antony Mark, Mr. Olver Mark and Mr. Sabas Shayo. Each of the parties had, through their counsel, filed written submissions as per rule 106 of the Tanzania Court of Appeal Rules, 2009, which they, during hearing, adopted to read as part of their oral arguments with some clarifications. As between the two marks, it has not been in dispute that the appellant's mark was the first to be registered. It is common ground that while the respondent had started using her trademark before registration, until the current suit was being instituted, the appellant was yet to start using the mark. She was just in preparation for commencement of the use of the same. Upon seeing the respondent's goods in the market with the mark which is allegedly similar to her trademark, the appellant commenced a suit for trademark infringement claiming for four substantive reliefs. First, perpetual injunction to retrain the respondent from infringing the appellant's trademark. Two, an order for an account of profit attributable to the sale of pure drinking water using the trademark in dispute and for payment of 40% of the profit thereof. Three, payment of TZS 3.5 billion as damages for trademark infringement. Four, interest thereon at Bank rate from the date of judgment to the date of full satisfaction of the decree. In her defence, the respondent denied infringing the appellant's trademark claiming that the two marks are not similar as alleged or at all as they have distinctive features in terms of colour, words and logs and that, the respondent has also exclusive right of use of the same by reason of registration. In advance of her case, the appellant paraded her director one Chacha Magoko Rukwi (PW1) who testified on how the appellants trade mark was conceived and eventually registered as exhibit P3; a senior assistant registrar of trade, and service marks one Gabriel Iranga (PW2) who essentially testified on the process involved in registration of both the marks; and a former bank officer one Thomas Pando Rweyemam (PW3) who testified on the preparation of the appellant to commerce business for which the trademark was registered. In addition, the appellant tendered her certificate of incorporation, water analysis report, the relevant trademark, payment receipts (for disclaimer, journal, advertisement and registration), payment receipts for drilling of well and business plan which were admitted and marked exhibits PI, P2,P3,P4,P5 and P6, respectively. On her part, the respondent solely relied on the testimony of her director one Usamah Mohamed Sheck (DW1) who testified in details on how the respondent's mark was conceived and registered and more importantly, on what he believed to be its distinctive features. She also produced the respondent's certificate of incorporation and relevant business licenses, bill of lading for thermoforming packing machine and the relevant trademark which were admitted into evidence and marked as exhibits Dl, D2 and D3, respectively. The determination of the suit by the trial court was essentially based on the issue whether or not the respondent had infringed the appellant's trademark. Depending on the outcome of the first issue, the trial court was prepared to address the issue as to whether or not the appellant suffered damages as a result of the infringement and, eventually, it would resolve the obvious issue as to what reliefs are the parties entitled. It occurred that, on assessment of evidence, the trial court was satisfied that the respondent's trademark was neither identical nor nearly similar with that of the appellant as to be likely to cause confusion. It, as a result, answered the first issue negatively and dismissed the suit with costs. In so holding, it would appear, the trial court relied on two tests. The first one being anti-dissection test which as stated in M/S South India Beverage Pvt Ltd. v. General Mills Marketing Inc. and Another (No. 961/2013 in CS (OS) 110/2013) is to the effect that when comparing two marks which are alleged to be identical or materially similar, the composite marks must be considered in their entirety rather than dissecting them into their component parts. Having applied the test and compered the two marks in accordance thereto, the trial court found that the two marks were not substantially similar as to be likely to cause confusion to the public. In the second place, the trial court applied the first syllable test according to which, the initial letter is particularly weighted in the assessment of similarity and likelihood of confusion of word marks. Having applied the principle, the trial court, held, in addition to the foregoing that, as the appellant's mark is preceded by the word RIG while the respondent's mark is preceded by the word 'Alya7 , that should be taken as another distinction." In support of the first ground, Mr. Mnyele submitted in effect that as the appellant's mark which was registered prior to that of the respondent had, among other marks, the word Afya, which was in terms of section 31 of the Act exclusively owned by her and, the respondent's mark having no exclusive right over such word, the trial judge misdirected herself by invoking the anti-dissection rule. Such rule, Mr. Mnyele clarified, could not apply as the respondents trademark comprised of a disclaimer as to the use of the same separately and apart from the mark as a whole/ He submitted that while the respondent was prohibited from using the said word in isolation with other marks as a whole, the appellant was not, and therefore, she has exclusive right to use such word. In relation to the second and third grounds, Mr. Mnyele attacked the trial court in the first place, for wrongly applying the first syllable rule insofar as it treated the word "RIG" which is merely an acronym as the first syllable while in his humble view, the first syllable should have been the word "Afya". He further submitted that since in both the trademarks it is only the word "Afya" which is inside the circle, such similarity in the positioning of the word has the likelihood of causing confusion to the public. To cement his view, the counsel quoted the following statement in the decision of the House of Lord of England in Saville perfumery Co. Ltd v. June Perfect Ltd and Another (1991) 58 R.P.C. 147 H.C) which was quoted by the High Court of Tanzania in Said Salim Bakhresa & Co. Ltd v. Agro Prossessing and Allied Products Ltd and Another, Commercial Case No. 31 of 2004: "if the essential feature o f a mark has been adopted additional words or devices do not enable the defendant escape liability for infringement The counsel further placed reliance on the following statement in the decision of the Court of Appeal of Tanzania in CPC International Inc. v. Zainab Grain millers Ltd, Civil Appeal No. 49 of 1995, which again was quoted by the High Court of Tanzania in the decision just referred: "It is settled principle that in matters o fpassing o ff, a prima facie (case) could well be shown if upon consideration of dose similarity between the trademarks complained o f was on balance such as to cause decision and confusion on the part o f the customers." It has to be noted, however that, while the current case is on trademark infringement, the authority just referred is on passing off. It is, therefore/ distinguishable and cannot apply in the case at hand where the appellant does not claim prior use of the trademark in question which is an essential element of the tort of passing off as per section 30 of the Act. See for instance, Sanlg Worldwide Investment & Others v. Wu Zhou Investment Company Limited, Commercial Case No. 592 of 2024. In respect to the fourth ground, Mr. Mnyele submitted that while the appellant pleaded that the respondent infringed upon the trademark by using the word Afya, the trial court invoked the first syllable rule and anti-dissection rule as if the appellant was complaining about the use of other marks. In so doing, the counsel suggested, the trial judge was engaging herself in conjecture while the pleadings and evidence especially exhibits P3 and D3 related to the use of the word Afya. In response, Mr. Mark Antony in the first place, declined to make any comment on the first ground as it does, in his opinion, amount to doubting the ability of the trial judge to compose a judgment which is totally irrelevant. On the other grounds, which he addressed concurrentiy, Mr. Mark did not agree with Mr. Mnyele's suggestion that the similarity complained of at the trial court was confined to the word "Afya". Quite differently, he submitted, the complaint was the two trademarks being similar. To him, just as it was at the trial court, the central issue in this appeal is whether the respondent has infringed the appellants trademark. As to when is a trademark said to be infringed, Mr. Mark Anthony referred to us the following commentary of the learned jurist P. Narayanan in his Intellectual Property Law (3rd Edition) as referred by the High Court of Tanzania, Commercial Division in Kenafric Industries Limited v. Lakairo Industries Group Co. Ltd & 4 Others, Commercial Case No. 132 of 2018: "a registered trademark will be infringed if the person in the course o f trade, in relation to the same goods for which the mark is registered, uses without authority the same mark or a deceptively similar mark." The counsel proposed that so as to arrive to a correct conclusion, three sub issues have to be addressed. First, whether or not the two trademarks are not distinguishable. Two, Whether the appellant has exclusive right to use the word "Afya" in its trade mark. Three, whether the respondent's use of the word "Afya" in its trademark constitutes an infringement of the appellants trademark as per section 32(1) of the Trade and Service Mark Act (the Act). On the first sub-issue, he submitted that since what is protected under the trademark law is the unique or distinctive marks which distinguishes the products or services from those of other enterprises, a trademark must as a whole be distinguishable among different products as per section 16 of the Act. On that premises, he submitted, the two marks are in their entirety different. He assigned four reasons. First, both of them passed the test of registrability which is a signification that they did not substantially resemble to each other. Two, even by comparison, which he urged us to do, the two marks are different each of which having its distinctive features. He submitted that, in his testimony, PW2 conducted such a task as per page 283 of the record and concluded that they were distinguishable. The counsel referred us to the authority in Double Diamond Holding Limited v. East African Spirits (T) Limited & Another, Commercial Case No. 8 of 2018 which was relied upon by the trial court. He subrpitted therefore that; the rule of anti-dissection was correctly applied. On the second sub-issue, it was his submission that, as the two trademarks are distinctive and, insofar as, in terms of section 31 of the Act registration of a trademark if valid, gives exclusive right to the registered proprietor, neither the appellant nor the respondent can assert exclusive right to use the word "Afya" against the other as neither of them has been given exclusive right to use such word. He submitted further that, just as it is express in exhibit D3 that the respondent is prohibited to use the word "Afya" separately from other marks as a whole, in exhibit P3, it is also express that the appellant is prohibited from using the words "Natural Drinking Water' separately and apart. The rationale behind the prohibition, he submitted, is because the word "Afya" is generic while the law relating to trademark is such that descriptive and generic terms cannot be monopolized since they can be used to describe various products from a large group of goods. In his conclusion, therefore, the two trademarks were not substantially similar. We have very carefully followed the counsel's debate and we shall hereinafter separate the wheat from the chaff. However, before doing that we find it inevitable to expose albeit briefly, the law relating to trademark infringement as it applies in Tanzania. As per section 31 of the Act, registration of a trademark confers an exclusive right of use of the same in relation to the goods or services in respect of which it was registered. It is also the principle of law that; where two identical or substantially similar marks are entered into register in respect of the same category of goods, the one whose entry into the register was the first, shall, subject to other provisions of the Act, be entitled to claim the benefits of the earlier application. The exclusivity of the right to use the respective mark protected by the law is, however, not absolute. Far from being validly entered into the register, it has to pass the tests of registrability in terms of sections 16 to 20 of the Act. Of most significance for the purpose of this case, is the requirement of the trademark being distinctive either inherently or by the reason of use as per section 16 of the Act which reads as follows: "(1) A trade or service mark shall be registered if it is distinctive. (2) For the purpose o f this section a trade or service mark is distinctive if it is capable, in relation to goods or services in respect o f which it is registered or proposed to be registered, o f distinguishing , goods or services in the case o f which no such connection subsists, either generally or, where the trade or service mark is registered or proposed to be registered subject to limitations , in relation to use within the extent o f registration. (3) In determining whether a trade or service mark is capable o f distinguishing for the purpose o f subsection (2), regard shall be to the extent to which- (a) the trade or service mark is inherently capable o f distinguishing as aforesaid; AND (b) by reason o f the use o f trade or service mark or o f any other circumstances, the trade or service mark is\ in fact capable o f distinguishing as aforesaid." Trademark infringement is a statutory tort which is created under section 32 (1) and (2) of the Act. The respective section enumerates various events through which such tort can be committed. Perhaps of relevancy in this matter is section 32(1) of the Act which provides: (1) The exclusive right referred to in section 31 shall be deemed to be infringed by any person who, not being the proprietor of a trademark or its registered user using by way o fpermitted use, uses a sign either- (a) identical with or so nearly resembling it as to be likely to deceive or cause confusion, in the course o f trade or business, in relation to any goods in respect o f which it is registered or in relation to any closely related goods and in such manner as to render the use o f the sign likely to be either- (i)as being used as trademark or business or company name; or (ii) in case in which the use is upon the goods or in physical relation to them, or in relation to services, or in advertising circular or other advertisement issued to the public, as importing a reference to some person having the right either as proprietor or as registered user to use the trademarks or to goods or services with which that person having the right either as proprietor or as a registered user to use the trademarks to goods or services with which that person is connected in the course o f business or trade; or (b) identical with or so nearly resembling it in the course o f trade or business in any manner likely to impair the distinctive character or acquired reputation o f the trademark." [Emphasis supplied] It may perhaps be necessary to observe that the exclusive right the infringement of which is prohibited under the above provisions is created by section 31 of the Act which provides that: '!Subject to the provisions and any limitations or conditions entered in the register, the registration o f a trade or service mark shall, if valid, give or be deemed to have given to the registered proprietor the exclusive right to the use o f a trade or service mark in relation to any goods including sale, importation and offer for sale or importation." Under the above provisions, it is plain that the exclusive right attached to a registered trademark is not absolute. Far from being valid, it subject to other provisions of the Act and any conditions or limitation thereof. More importantly, as the learned author Alex B. Makulilo observed, such exclusive right "accrues when a proprietor has fulfilled the requirements o f sections 16-20 o f the TMA which relate to registration requirements." [See his article entailed "Likelihood of Confusion: what is the yardstick? Trademark Jurisprudence in Tanzania; in Journal of Intellectual Property & Practice, 2012. Vol. 7. No. 51. Therefore, for one to succeed in an action for trademark infringement, he has to prove that the registration of his trademark was in due compliance of the law and was valid. One of the contention here is whether the appellant has exclusive right to use the word "Afya" which the respondent alleges that it is generic in relation to pure drinking water. For the appellant, it was submitted that since unlike in exhibit D3 wherein the word "Afya" is shown to have been expressly disclaimed, in exhibit P3 there is neither disclaimer nor restriction of the exclusive right to use such word. With respect, we cannot, for the reasons which shall be apparent as we go along, agree with that submission. The appellant's claim in this case has been that the two marks which are irrefutably used for the same class of goods are substantially similar as to be likely to cause confusion to the consumers. We note that, at the time of the alleged infringement, the appellant was yet to start using it. She was in preparation thereto. Obviously, therefore, the confusion complained of is not actual but a probable confusion. There has been a hot debate between the counsel as to whether the appellant has exclusive right to the use of the word "Afya". That, we think, cannot consume much of our time. Reason being that the respective word being generic insofar as its dictionary meaning has inherent connection with pure drinking water as the same is always for afya (health), it is not, in terms of section 16(a) of the Act, inherently capable of being distinguished. The appellant having admitted to have not started using the trademark, it cannot, assuming it was protectable, be said that it acquired a secondary meaning over and above its common meaning in relation to the product for which it was registered. Therefore, in the English case of Premier Brands Uk Ltd v. Typhoon Europe Ltd & Another [2000] EWHC 1557 (Ch.) it was observed: "In connection with a particular registered mark, the less use it has had in connection with goods for which it is registered, the less distinctiveness it is likely to have acquired, and, therefore, the more the protection claimed for it has to be limited to its inherent distinctiveness." From what we have discussed above, it would seem apparent to us that, giving exclusive right to the appellant to use the said word separately and apart from the mark as a whole would amount to unfair competition as the appellant will have monopoly of the use of such generic word in pure drinking water business which is in law prohibited. In our judgment, therefore, the appellant has no exclusive right to use the generic word "Afya". We also agree with Mr. Antony Mark that; for a trademark having the word "Afya" as part of its features to be valid, the appellant ought, before procuring registration, to have disclaimed exclusive right of use of such word. This is in accordance with condition under section 18 of the Act which provides as follows: "If a trade or service mark contains a matter or matters common to the trade or it is o f non- distinctive character, in determining whether the trade or service mark should be entered or remain in the register, it shaii be required as a condition o f its being on the Register- (a) that the applicant or the proprietor shall disclaim any right to the exclusive use o f all or any portion o f that trade or service mark as aforesaid to the exclusive use o f which he is not entitled; or (b)that the applicant or the proprietor shall make such other disclaimer as is considered necessary for the purpose o f defining his right under the registration, provided that no disclaimer on the register shall affect any rights o f the proprietor o f a trade or service mark except such as arises out o f registration o f the trade or service mark in respect o f which the disclaimer is made." From the documentary evidence in exhibit P4, it would appear, the appellant paid, among others, fees for disclaimer. This means that the appellants registration of the trademark was conditional upon there being a disclaimer. For the reason better known to herself and while aware she had the burden of proof, the appellant did not dare produce such a disclaimer. Since as we have said, registration confers exclusive right of use if it is valid, in the absence of such disclaimer, the trial court could not be in a better position to establish if the word "Afya" generic as it is, was not disclaimed. On that account, we hold that, the appellant did not prove exclusive right to use the word "Afya". He can only claim exclusive use to her entire get up or mark. This now takes as to the issue of whether the two trademarks were substantially similar as to be likely to cause confusion. As we said above, in addressing the issue, the trial court employed anti-dissection test. Mr. Mnyere submits that the rule was inapplicable since the complaint was on the exclusive right to use the word "Afya". We have already held that neither of the parties have exclusive right to use the same. That aside, like the trial judge, it is our understanding of the law that, as a general rule, that has been the test to determine similarities of two trademarks. In law, that is done by the trial court compering the two marks by assuming the position of a common consumer. That task, we note from the record, was done by the trial court. During cross examination, we note also that PW2 was caused to compare the two and remarked that they were similar. On her part, the trial court having compered the two marks and portrayed their graphic distinctive features, she held as a point of fact that the two were not similar. In her own words, the trial judge remarked: "In our case at hand, as per exhibit P3 the words are "RIG Afya NATURAL DRINKING WATER" whereas as in accordance with exhibit D3 the word is "Afya" not similar. Looking at their logo, the Plaintiff trademarks comprises on top the word RIG written in white, followed with a drop o f water in blue and, below it with the word Afya' written in blue and a curve shape o f words written in capita! letters NATURAL DRINKING WATER with green grasses at the bottom with blue background. On the other side, the Defendant's logo contains an image o f yellow came! on the top left side o f the mark, sprayed with water in blue and the word A fya' in the middle, centered written in yellow, in a distinctive front from the Plaintiff's and yellow bow at the bottom o f the word Afya'. It is without flicker o f doubt that the two trademarks in general, depicts no similarities whatsoever." As the first appellate court, we have had an opportunity to, in assumption of the role of common consumer in the street, compare the two marks and we are entirely in agreement with the trial judge that, the two marks are not substantially similar. The distinctive features of the same have been clearly and correctly portrayed by the trial judge as above reproduced and we see it unnecessary to repeat. The complaint by Hr. Mnyere that she incorrectly applied the first syllable principle is also baseless because it was based on the proposition that the appellant has exclusive right to use the word "Afya", the proposition which we have held to be invalid. The above findings would suffice to determine the appeal. However, a pertinent issue which is also decisive has been raised and considerably argued in this appeal. Mr. Mnyere has suggested, basing on the rule as to priority of first registered user that, by subsequently registering and using a trademark which is substantially similar with that of the appellant, the respondent has committed an act of trademark infringement in terms of section 32(1) of the Act. For the respondent, it was submitted that, as the respondent's trademark is also registered, the respondent being the owner, cannot commit the respective tort because by virtue of registration, she is, like the appellant, and with similar protections, deemed to have exclusive right to use the same. To start with, it would appear plain to us that, under section 32(1) and (2) of the Act, tort of trademark infringement can be committed by '"any person who, not being the proprietor o f the trademark or its registered user" In here, the respondent is, by virtue of exhibit D3, the registered owner of the trademark in dispute. We understand that under the express provision of section 31 of the Act, the exclusive right conferred to the owner by virtue of registration is not absolute. It must have been validly entered into the register. Equally aware, registration of a trademark which is identical or substantially similar with that which has already been registered is as a general rule, prohibited under section 20(1) of the Act. It is the law, however that, such prohibition is not absolute. This is because, the registrar of trade and service marks enjoys discretion under section 20 (2) and (3) of the Act to register a trademark which is identical or nearly similar with that already in the register in the case of honest concurrent use or other special circumstances. The provisions read as follows: ”(2) In the case o f honest concurrent use,, or other special circumstances, trade or service marks that are identical or nearly resemble each other in respect o f the same goods or services or closely related goods or services may be registered in the names o f more than one proprietors, subject to any conditions and limitations, if any, which it considers necessary to impose." In our view, since the law is such that in fit cases, two or more than two trademarks can validly be entered in the register, and, insofar as registration of a trademark raises a conclusive evidence of compliance of the registration requirements, the respondent's trademark is, subject to a decision by the Registrar or the High Court in terms of sections 35- 39 of the Act, deemed to be valid in the same way as it is the appellant's trademark. Therefore, in view of section 32(4) of the Act, an action for trademark infringement cannot, unless such trademark is declared invalid or removed from the register, lie against the respondent. The respective provisions read as follows: "(4) The use o f a registered trade mark, being one o f two or more than two trademarks that are identicai or nearly resemble each other in exercise o f the right to use o f that trademark given by registration under section 31 shall not be deemed to be an infringement o f the right so given to the use o f any other o f those trademarks." In our reading, the above provision, unambiguously creates a shield against infringement claims between registered owners of trademarks. The rationale behind the rule, as correctly observed by the Commercial Division of the High Court in Double Diamond Holdings Limited v. East African (T) Limited and Another (Commercial Case No. 8 of 2018) with which we associate ourselves, is in effect that, the registration could not simultaneously grant a right and declare it illegal. The High Court in the respective decision was inspired by the following commentary of the learned author Professor Jeremy Philips in his book entitled Trade Mark Law A Practical Anatomy, Oxford university Press, Oxford 2003, p.228: "The law cannot be expected simultaneously to blow hot and cold. I f it grants a person a trade mark monopoly, following a formal process o f application and examination, it would be absurd to say in the same breath that the holder o f that trade mark both owned the monopoly rights in that mark and was actually infringing someone else's mark. Where a later mark does indeed appear to overlap with an earlier one, the owner o f the earlier mark may not assume that the user o f the later mark is o f necessity an infringement." We are highly persuaded by the above commentary, We have no doubt that it indeed represents the correct position of law in line with the provisions of section 32(4) of the Act. Therefore, assuming, which is not that, the trial court was wrong in holding that the two marks were materially different, yet an action for trade mark infringement would not, in so long as exhibit D3 remains in the register, lie against the respondent. From the foregoing discussion, therefore, we find the appeal devoid of any merit. It is hereby dismissed with costs. DATED at DODOMA this 10th day of April, 2025. S. A. LILA JUSTICE OF APPEAL I. J. MAIGE JUSTICE OF APPEAL Z. G. MURUKE JUSTICE OF APPEAL Judgment delivered this 11th day of April, 2025 in the presence of Mr. Sabas Shayo, learned counsel for the respondent, also holding brief of Mr. Roman Selasini Lamwai, learned counsel for the Appellant, throuqh virtual court, is hereby certified as a true copy of the original.