Passing Off - trade name - essentially descriptive words - necessity for distinctive or secondary meaning - rationale - logic and policy - substantial evidence necessary to establish secondary meaning - mere expression of confusion or belief by individuals insufficient.

Costs - both parties successful on some issues - unsuccessful on others - discretion of trial judge - matter of impression and evaluation.

Business Names Act 1962 (Vic)

Trade Practices Act 1974 ss. 52, 53, 82

Fair Trading Act 1985 (Vic) ss. 11, 12

Federal Court of Australia Act 1976 s.43

New South Wales Dairy Corporation v. Murray Goulburn Co-Operative Company Ltd [1990] HCA 60; (1990) 171 CLR 363

Conagra Inc. v. McCain Foods (Aust) Pty Ltd [1992] FCA 159; (1992) 33 FCR 302

Motorcharge Pty Ltd v. Motorcard Pty Ltd [1982] FCA 90; (1982) 42 ALR 136

Equity Access Pty Ltd v. Westpac Banking Corporation (1990) 12 ATPR 40-994

BM Auto Sales Pty Ltd v. Budget Rent A Car System Pty Ltd (1976) 12 ALR 363

Hughes v. Western Australian Cricket Association (Inc.) (1986) 8 ATPR 40-748

Cretazzo v. Lombardi (1975) 13 SASR 4

Trade Practices Commission v. Nicholas Enterprises Pty Ltd (1979) 42 FLR 213

Commissioner of Australian Federal Police v. Razzi [1991] FCA 267; (1991) 101 ALR 425

Reddaway v. Banham (1896) AC 199; (1895) 1 QB 286

The Cellular Clothing Co. Ltd v. Maxton and Murray (1899) AC 326

Cadbury Schweppes Pty Ltd v. Pub Squash Co. Pty Ltd (1980) 2 NSWLR 851

W. and J Gilbey Ltd v. Continental Liqueurs Pty Ltd [1960] HCA 21; (1960) 103 CLR 406

Solicitors for the Appellants: Henderson and Ball by their Sydney

Agents: Christopher C. Freeman and Co.

Counsel for the Respondents: Mr R. Webb

Solicitors for the Respondents: Garland Hawthorn Brahe

1. The appeal is dismissed.

2. The appellants to pay the respondents' costs of the appeal.

Note: Settlement and entry of Orders is dealt with in Order 36 of the Federal Court Rules.

GUMMOW, FRENCH AND HILL JJ In the hot and sunny conditions which prevail in many parts of Australia, the application of tinted polyester-based film to the windows of buildings and motor vehicles to reduce transmission of heat, glare and ultra-violet light is a significant industry. A major operator in the industry in the State of Victoria has used the words "Solar Tint" to describe its business for some ten years. In 1989 a provider of similar services in New South Wales obtained registration of trade marks embodying the word "Solartint" alone and in combination with a motor vehicle logo. It also made an agreement with a window tinting business in Geelong permitting it to use the name "Solar Tint". The successive corporate proprietors of the Victorian business filed an application in this Court against the New South Wales trader seeking orders that the registered trade marks be expunged and claiming damages and injunctive relief for passing off. The New South Wales trader cross-claimed for infringement of its trade marks. After a trial of the action before Lockhart J, it was ordered that only the word mark be expunged. The application was otherwise dismissed as was the cross-claim. His Honour directed that there be no order as to costs. The applicants in those proceedings now appeal against the dismissal of the application and the costs order made.

2. Bruce Westley Penton-Dodds has been involved in the window tinting industry in Victoria for some thirteen years, having commenced business in that State in 1980. In July 1981, he registered the name "Solar Tint" under the Business Names Act 1962 (Vic). In 1982, he incorporated Solar Tint Pty Ltd and carried on the business through that company of which he and his wife were the only shareholders. In October 1989, Solar Tint Pty Ltd changed its name to Dodds Family Investments Pty Ltd (DFI) and the operation of the business was taken over by another company, Melton Heights Pty Ltd, of which Mr Penton-Dodds was a director and shareholder. Its name was changed to S.W.D. Group Pty Ltd (SWD) in April 1990 and it still trades in Victoria under the registered business name "Solar Tint".

3. The Solar Tint business which has been operated by the Dodds interests since 1980 involves the installation of polyester-based film on motor vehicle windows and flat glass windows in domestic and commercial premises. The business name has been displayed and promoted in Victoria through the use of business cards, stationery, invoices, bumper stickers, leaflets, newspaper advertisements, advertisements in the Melbourne Yellow Pages Telephone Directory (since 1981) and entries in the Melbourne White Pages Telephone Directory. The name has also appeared in promotional folders made available to major commercial and governmental clients in Victoria. The business is operated from a main office at Moorabbin and has branches at Dandenong, Boxhill, Richmond, South Melbourne, Preston and Footscray. It employs twelve staff and applies tint to an average of twelve cars per day and about 15,000 square feet of domestic and commercial flat glass windows each month. Another measure of its size may be seen in the volume of its purchases of window tinting film from Solar Shield Pty Ltd which supplies the product in Victoria. Solar Tint is Solar Shield's largest customer in that State, expending $152,828 on the purchase of film in 1990 and $127,938 in 1991. The present turnover of Solar Tint is $800,000 to $1 million per annum. Advertising costs for the business have grown from about $15,000 in the year ended 30 June 1982 to $30,000 in the year ended 30 June 1990. Currently they are running at somewhere between $35,000 and $40,000 annually.

4. In 1979, Gary and Glenda Lane started up a car window tinting business in New South Wales under the name Solartint (Sun Control) Industries. In 1981 they incorporated Lane Industries Pty Ltd (Lane Industries) which has carried on the business since that time. By 1989 the business had seven branches in and around the Sydney metropolitan area at Ashfield, Auburn, Bondi Junction, Liverpool, West Ryde and Seven Hills. It evidently also has an agency in Albany in Western Australia which uses the word Solartint. That name has been displayed on the company's business documentation and advertised through newspapers, magazines, radio, television and at motor shows. It is advertised in the Yellow Page Directories published in Sydney, Melbourne and Brisbane. In the year ended 30 June 1991, the business sold window tinting film to the value of $1,713,277 and expended $55,098 on advertising. The advertising extended to the Gold Coast, Brisbane, Cairns, Perth, Melbourne and Geelong. Since 1987 Lane Industries has made agency or licensing arrangements for the use of the name Solartint and has franchise outlets at Gosford, Tweed Heads and Newcastle. In June 1989, the company registered two trade marks as service marks. Registered trade mark A390995 which is in Part A of the Trade Marks Register comprises the word "SOLARTINT" in respect of the application of sun control products to glass being services in Class 37 of Schedule 4 to the Trade Marks Register. Registered trade mark A390996, also in Part A of the Trade Marks Register, comprises the word "SOLARTINT" with a motor vehicle logo in respect of the same services.

5. George Edwards and his wife are directors of a company called Edward's Auto Accessories Pty Ltd which is located in Geelong. Its principal business involves the fitting of accessories to motor vehicles. It also operates a small motor vehicle window tinting business as the Victorian licensee of Lane Industries. It has been the licensee of that company since late 1989. The tinting business accounts for 10% of its turnover and involves the treatment of 3 to 4 cars each week. The business is called "Solar Tint Geelong". It draws its clientele from the Geelong area and not from people based in Melbourne or its surrounding suburbs.

6. The words "Solar Tint" and "Solartint" have also been used in Queensland. A company called Hambel Pty Ltd carries on the business of selling and installing tinting film for automotive, domestic and commercial purposes under the name "Solartint" in Mackay, Queensland. The name has been advertised in print and electronic media, White and Yellow Page Telephone Directories and the newsletter of the Royal Automobile Club of Queensland. The annual turnover of the business is about $150,000 with advertising expenditure running at between $15,000 and $20,000 per annum. Another Queensland business using the name "Solar Tint" has been operated in Brisbane by Mr John Hatzinik since 1982. He sells and installs tinted window film for automotive and building glass. In 1983 he started business under the name "Brisbane Solar Tint Shop". In November 1985 he registered the business name "Brisbane Solar Tint Shop" under State business name legislation. Mr Hatzinik had agents in rural areas of Queensland authorised to use the name "Solar Tint". He operated a total of eleven such agencies from 1983 until 1986 when he ceased wholesaling window tinting film. Among promotional methods he used was the distribution of handbills inviting the reader to "Let us Solar Tint your windows". Many thousands of these handbills were distributed in letterboxes and other places in and around Brisbane. Mr Hatzinik's agents used similar methods in their localities.

7. In November 1982, Mr Hatzinik applied for registration of the trade mark "Solar Tint" with a logo by application 383827. On 29 November 1983, he was informed of an application to the Trade Marks Registrar by Lane Industries. He telephoned Lane Industries and spoke with Glenda Lane who said that the company was using the name "Solartint" as a business name but not as a trade mark. This was later confirmed by Gary Lane. Nevertheless, Lane Industries lodged an objection to Mr Hatzinik's registration which stood and was heard on 7 August 1987. On 30 October 1987, the Assistant Registrar of Trade Marks held that Mr Hatzinik was not entitled to claim to be the proprietor of the trade mark "Solartint" and found for Lane Industries. There was no evidence that he had ever used his mark but there was evidence of use by Lane Industries of "Solartint" since 1979 in the relevant field.

8. In South Australia there was an application for registration of the business name "Solar Tint Industries" made on 9 July 1982 identifying the nature of the business as that of window insulation. The date of commencement of the business was specified as 13 September 1982. A company called Solar Tint Industries Pty Ltd was incorporated on 22 November 1984 and it carried on the business of window insulation. That company was subsequently wound up. It has no connection with any of the parties to these proceedings.

9. By their application filed on 30 May 1990, DFI and SWD sought rectification of the Trade Mark Register by expunging from it the entries related to trade mark numbers A390995 and A390996. Injunctive relief was sought to prevent the respondents from using the words "Solartint" and "Solar Tint" in Victoria in connection with the business of window tinting. Damages were claimed under s.82 of the Trade Practices Act 1974 and in the alternative, an account of profits.

10. In the statement of claim filed with the application it was alleged, inter alia, that the name "Solar Tint" had become and was well known at all material times to the industry and the public generally in the State of Victoria as signifying that the name related exclusively to the selling and installing of window tinting film by DFI and/or SWD. The trade marks registered in the name of Lane Industries were said not to have been, either at the time of the commencement of these proceedings or at the time of registration, distinctive of the goods and services of the first respondent. The word "Solartint", it was said, was not an invented word and had direct reference to the character and/or quality of the goods and services in respect of which registration had been obtained. Alternatively, the trade marks were not at the time of registration, or at the time of commencement of the proceedings, distinctive of the goods and services of Lane Industries in that the name "Solartint" had become and was well known at all material times to the industry and the public generally as relating exclusively to the selling and installing of window tinting film by certain persons and corporations throughout Australia. The persons and corporations relied upon were Mr Penton-Dodds and his two companies, Mr Hatzinik and Hambel Pty Ltd in Queensland and Mr Eric Parker in South Australia. Alternatively it was said that the trade marks were marks the use of which was likely to deceive or cause confusion in contravention of s.28(a) of the Trade Marks Act 1955.

11. The respondents were said to have represented and to continue to represent falsely that their window tinting film and installation services had the sponsorship and/or approval of DFI and SWD. They were said to have engaged in conduct that was misleading or deceptive or likely to mislead or deceive in contravention of s.52 of the Trade Practices Act 1974. Section 53 of the Trade Practices Act was also invoked, along with ss.11 and 12 of the Fair Trading Act 1985 (Vic).

12. Further and alternatively, it was alleged that the respondents had passed off or were continuing to pass off their window tinting film as and for window tinting film manufactured by or for or with the approval of and/or connected in the course of trade with DFI and SWD. The respondents were also said to have passed off and to be continuing to pass off their business as and for a business of and/or approved by and/or connected with the business or businesses of DFI and SWD. The respondents were said to have made considerable profits by their acts and DFI and SWD to have suffered substantial loss and damage.

13. By a cross-claim filed in July 1991, Lane Industries asserted that its registered trade marks were subsisting and of full force and effect and that DFI and SWD had infringed and continued to infringe the trade marks. Injunctive relief restraining SWD was claimed together with an order for delivery up of materials bearing the words "Solar Tint" or "Solartint". Damages or an account of profits was claimed against both DFI and SWD.

14. The matter came on for hearing before Lockhart J in May and November 1992 and judgment was delivered on 4 November 1992. Lockhart J. ordered that the application be dismissed, that the entry of trade mark number A390995 be expunged pursuant to s.22(1)(b) of the Trade Marks Act and that the cross-claim be dismissed. His Honour also directed that there be no order for the costs of any party.

15. After noting the findings of fact which have already been outlined, his Honour identified as the central questions in the case:

1. Whether the registered marks were distinctive of the

services of Lane Industries.

2. Whether the words "Solar Tint" and "Solartint" were

distinctive of the business of the applicants in Victoria

for the purposes of the relief sought in passing off.

On the question whether the registered marks were distinctive of the services of Lane Industries, his Honour, after referring to the relevant case law, noted that "Solar" and "Tint" are common English words of everyday usage and held that, whether conjoined or used as two words, they conjured up the notion of the service itself and that either the process or the result of the service could be said to be Solar Tinting or Solar Tint as the case may be. The common understanding of the expression indicated that it was fundamentally a descriptive use of the words in connection with the process of installing window tinting film to glass, so that persons engaged in the trade or customers would in the ordinary course of events use those words to describe the services. His Honour said:

"The words "Solar Tint" are prima facie descriptive, so

the difficulty of establishing that they are

distinctive of the services of Lane Industries is

considerably increased. In my opinion the words have

been used in the word mark by Lane Industries

primarily for the purpose of describing the particular

kind of services conducted by Lane Industries. I am

not persuaded that they were used even secondarily for

the purpose of distinguishing the services of Lane

Industries from the services of others."

In his Honour's opinion, the word mark, that is trade mark A390995, should not have been on the Register and the Register should be rectified accordingly.

16. Although in the light of that finding it was not strictly necessary to do so, his Honour went on to deal with a submission by the applicants that the word mark was one the use of which would be likely to deceive or cause confusion and otherwise be not entitled to protection in a court of justice (Trade Marks Act s.28). He accepted that a substantial number of customers and prospective customers would be caused to wonder whether the Lane Industries service and that of the applicants came from the same source. However in the light of what the High Court said in New South Wales Dairy Corporation v. Murray Goulburn Co-operative Company Ltd [1990] HCA 60; (1990) 171 CLR 363, he held that the submission failed because the applicants had not demonstrated any relevant blameworthy or disentitling conduct on the part of Lane Industries.

17. Turning to the applicants' case in passing off and under the provisions of the Trade Practices Act 1974 and the Fair Trading Act 1985 (Vic), his Honour noted that it was common ground that the statutory claims would involve no elements additional to those necessary to establish the passing off claim. It was, he said, fundamental to the passing off case that the words "Solar Tint" and "Solartint" be distinctive of the applicants' business in Victoria. In this respect the conclusions about distinctiveness which he had come to in relation to the trade marks question were relevant in the passing off context. The words "Solar Tint" and "Solartint" were essentially descriptive of the applicants' business. He was not satisfied that a new and secondary meaning arose from the use of the words in that context which was different from their primary descriptive meaning.

18. In relation to the device mark of Lane Industries, his Honour held that it was distinctive but that the distinctiveness derived from the device and not from the word "Solartint". To reproduce that word or the words "Solar Tint" only would be no infringement of the device mark. There was therefore no infringement in this case. Nor had any case been made out to successfully challenge the validity of the device mark or for an order that it be expunged.

19. His Honour concluded that the applicants had failed to establish a case of passing off and the respondents had failed to establish infringement of the word mark or the device mark. The applicants however had made good their case for expungement of the word mark. On the question of costs he said:

"Assessing costs in these circumstances is of necessity

to some extent an arbitrary matter; but having heard

the case and knowing the time that was spent roughly

on the various issues in the proceeding, I am

satisfied that the interests of justice are best

served by ordering the parties to bear their own

costs, that is by making no order as to costs."

"1. The application of the applicants be dismissed.

2. The entry of trade mark No. A390995 made in and remaining

in the Register of Trade Marks be expunged pursuant to

s.22(1)(b) of the Trade Marks Act.

3. The cross-claim be dismissed.

4. There be no order for the costs of any party."

20. The grounds of appeal against his Honour's decision were as follows:

1. That he erred in holding that the name "Solar Tint" or

"Solartint" was not distinctive of the Appellants'

business in Victoria.

2. That he erred in failing to hold that the name "Solar

Tint" or "Solartint" had acquired a secondary meaning so

as to become distinctive of the Appellants' business in Victoria.

3. That he erred in failing to give proper or due weight to

the evidence of Mr Goodison, Mr Neave, Mr Lloyd, Mr

Thomson and Mr Boyd relating to the distinctiveness of

the name "Solar Tint" or "Solartint" to the Appellants'

business in Victoria.

4. That he erred in failing to hold that the appellants were

entitled to an order for costs in so far as they related

to the order that the entry of the Trade Mark No. A390995

made in and remaining in the Register of Trade Marks

should be expunged pursuant to s.22(1)(b) of the Trade Marks Act.

21. Precise definition of the elements of the tort of passing off is elusive - Conagra Inc. v. McCain Foods (Aust) Pty Ltd [1992] FCA 159; (1992) 33 FCR 302 at 355-365 (Gummow J). Nevertheless, because it involves a misrepresentation, it is essential to the cause of action that the goods or services in respect of which protection is sought, have a reputation with a substantial number of persons who are or would be acquirers of those goods or services within a relevant geographical area. That reputation is necessarily to be associated with the designation and/or getup of the goods or services. Designations of goods or services may involve words, symbols or pictures or some combination thereof. Where one trader has used particular words, symbols or pictures the use by another of the same or a similar designation in association with like goods or services is capable of constituting passing off if the other elements of the tort are present. The parasitic user appropriates the goodwill of the originator because its conduct gives rise to the inference in the minds of consumers that the two groups of goods or services are somehow related. The causative connection is reputation, an association in the minds of consumers between the originator's designation and its goods or services. Merely descriptive words will not ordinarily effect such an association.

22. There is, of course, a range of classes of commercial designation from the purely descriptive with no identifying elements to a unique identifying designation with no descriptive element. Between these poles are hybrid terms such as "motorcharge" used to designate a petrol credit and purchase system - Motorcharge Pty Ltd v. Motorcard Pty Ltd [1982] FCA 90; (1982) 42 ALR 136. In Equity Access Pty Ltd v. Westpac Banking Corporation (1990) 12 ATPR 40-994 Hill J said:

"Just as the distinction between descriptive and fancy

names is not a distinction of law so too it is wrong

to see the distinction in black and white terms. The

reality is that there is a continuum with at the

extremes purely descriptive names at the one end,

completely invented names at the other and in between

names that contain ordinary English words that are in

some way or other at least partly descriptive. The

further along the continuum towards the fancy name one

goes, the easier it will be for a plaintiff to

establish that the words used are descriptive of the

plaintiff's business. The closer along the continuum

one moves towards a merely descriptive name the more a

plaintiff will need to show that the name has obtained

a secondary meaning, equating it with the products of

the plaintiff (if the name admits of this - a purely

descriptive name probably will not) and the easier it

will be to see a small difference in names as adequate

to avoid confusion."

(p 50,956)

But even descriptive words may become distinctive of the business of a particular person and if the use of such words by another is calculated to deceive persons into believing that the business of their originator is carried on by the parasitic user and is likely to cause damage to the originator's business, then a claim for relief for passing off may succeed - BM Auto Sales Pty Ltd v. Budget Rent A Car System Pty Ltd (1976) 12 ALR 363 at 369 (per Gibbs J, Barwick CJ and Murphy J agreeing). Counsel for the appellants referred us to Reddaway v. Banham (1896) AC 199. In that well known case, the House of Lords reversed the decision of the Court of Appeal ((1895) 1 QB 286) and restored the judgment in the Queens Bench Division. This had been in favour of the plaintiffs. In addition, their Lordships held that the plaintiffs should have an injunction restraining the defendants from using the word "Camel hair" as descriptive of or in connection with belting manufactured or sold or offered for sale by them, without clearly distinguishing such belting from the belting of the plaintiffs. In the Queens Bench Division, a jury had answered affirmatively the question whether "Camel hair belting" meant belting made by the plaintiffs as distinct from belting made by other manufacturers. This decision reminds us that the issue of distinctiveness is one of fact, to be determined upon the available evidence.

23. Of Reddaway v. Banham, Lord Halsbury later said, in The Cellular Clothing Co. Ltd v. Maxton and Murray (1899) AC 326 at 336:

"Certainly the Camel-hair Belting Case may be an

example of what, under ordinary circumstances, it

would be very difficult to establish; but it was

established there."

Hence the comment that Reddaway must be an extreme example of cases where a descriptive mark has acquired a "secondary meaning": Shanahan "Australian Law of Trade Marks and Passing Off", 2nd Ed. 1990, p 403.

24. In this case his Honour held that the words "Solar Tint" and "Solartint" are essentially descriptive of the services provided by Dodds Family Investments and S.W.D. Group. And while it may be said that the words are not purely descriptive, it cannot be said that his Honour was incorrect in his conclusion. Nor is the conclusion challenged. The issue on the appeal is whether his Honour erred in holding that the words had not become distinctive of the appellants' business in Victoria. Substantial evidence was necessary to establish that characterisation. Primarily that is because of the logical necessity for the appellants to show a reputation attaching to the designation of their services which rendered the use of the same designation by another user a misrepresentation of a relationship between its services and those of the appellant.

25. The proceedings in this Court were instituted on 30 May 1990, but the relevant date for the determination of the issue of distinctiveness is that of the commencement in 1989, in Victoria, of the alleged passing-off, which the appellants seek to restrain: Cadbury Schweppes Pty Ltd v. Pub Squash Co. Pty Ltd (1980) 2 NSWLR 851 at 861. The primary Judge described the nature and extent of the advertising by which the name "Solar Tint" had been promoted in Victoria by Mr Penton-Dodds and his successors in business. His Honour also described the growth of the business of the appellants and we have set out his findings in that regard earlier in these reasons. However, further evidence which might support a finding of secondary meaning was thin. The appellants relied upon a number of affidavits which were not controverted. The deponents were not subject to cross-examination. Mr Frank Goodison, a window tinter of Dandenong in Victoria, gave evidence that in early February 1990 he had attended a promotional meeting in Melbourne conducted by Lane Industries at which "Madico" window tinting film was promoted as an alternative to the film he then used. Present at the meeting was a person who stated that he was from "Solar Tint" in Geelong. This was the first time Mr Goodison had heard of a Solar Tint office in Geelong. Until he was informed to the contrary in March 1990, Mr Goodison was of the mistaken view that the business conducted in Geelong was a branch office of that conducted by the Dodds interests. He had first become aware of the business "Solar Tint" conducted by Dodds in or about 1985. Mr James William Neave is the managing director of Solar Shield Pty Ltd which supplies window tinting film products for automotive and building purposes. He commenced supplying window tinting film to what was then Solar Tint Pty Ltd (later DFI) in September 1987 and continued to be its sole supplier until November 1991. He also supplied other window tinting businesses in Victoria. He recalled that on Friday, 16 March 1990 he had held a meeting for all his Victorian clients. The meeting was attended by Bruce Penton-Dodds as well as other operators of window tinting businesses. Up until the date of that meeting Mr Neave had always associated the name "Solar Tint" in Victoria with the business being conducted by Dodds and his companies.

26. There was also an affidavit from Phillip Dodds who had attended the Lane Industries promotional meeting in Melbourne in early February 1990. He met somebody from "Solar Tint", Geelong at that meeting. Until advised to the contrary at the Solar Shield meeting on March 16, 1990, he had the mistaken view that the business conducted in Geelong was a branch office of that conducted by Dodds. He had always associated the name "Solar Tint" in Victoria with the Dodds business. Mr Ian Lloyd, the stock controller of City Ford in Melbourne, has dealt with Mr Penton-Dodds through his business "Solar Tint" since approximately 1982. From that time until the recent downturn in motor vehicle sales, Solar Tint would have tinted approximately fifty motor vehicles per year for his company. He said he found it thoroughly confusing that a business could operate in Victoria using the name "Solar Tint" without being associated with Dodds. Mr Ross Thomson, the sales manager for Pitstop Toyota in Melbourne, had also come to know Dodds through his window tinting business "Solar Tint". He too found it confusing and difficult to understand how another business could be conducted in Victoria using the same name, without being connected to Dodds.

27. In our opinion this evidence, although uncontradicted and not the subject of cross-examination, was simply insufficient on its face to establish a distinctive or secondary meaning associated with the words "Solar Tint" in connection with the appellants' services and his Honour did not err in finding that the appellants had failed to establish the necessary reputation; cf W. and A. Gilbey Ltd v. Continental Liqueurs Pty Ltd [1960] HCA 21; (1960) 103 CLR 406 at 417-8. Mere expressions of opinion that the use by another trader of the same name is surprising or confusing does not go any way to establishing distinctive or secondary meanings for substantially descriptive words. In our opinion this aspect of the appeal fails.

28. Pursuant to s.43(2) of the Federal Court of Australia Act, the Court has a general discretion to award costs. Considerations relevant to the exercise of that discretion were enunciated by Toohey J in Hughes v. Western Australian Cricket Association (Inc.) (1986) 8 ATPR 40-748 at p 48,136:

"1. Ordinarily, costs follow the event and a successful

litigant receives his costs in the absence of special

circumstances justifying some other order...

2. Where a litigant has succeeded only upon a portion of his

claim, the circumstances may make it reasonable that it

bear the expense of litigating that portion upon which it

has failed...

3. A successful party who has failed on certain issues may

not only be deprived of the costs of those issues but may

be ordered as well to pay the other party's costs of

them. In this sense, "issue" does not mean a precise

issue in the technical pleading sense but any disputed

question of fact or of law..."

The propositions enunciated in that case are subject to the further consideration that justice may not be served if parties are dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case - Cretazzo v. Lombardi (1975) 13 SASR 4 at 12. In Trade Practices Commission v. Nicholas Enterprises Pty Ltd (1979) 42 FLR 213, Fisher J regarded the discretion to apportion costs as one to be exercised only in the most exceptional circumstances. Nevertheless he accepted that where a considerable part of the trial is taken up in determining issues upon which a party fails, it is a proper exercise of the discretion to reduce the costs allowed to that party. Generally speaking, and notwithstanding the considerations referred to by Toohey J and the other authorities mentioned above, the demands of the community for greater economy and efficiency in the conduct of litigation may properly be reflected in a qualification of the presumption that a successful party is entitled to all its costs. In Commissioner of Australian Federal Police v. Razzi [1991] FCA 267; (1991) 101 ALR 425 at 430, Wilcox J, after referring to the importance of the general principle enunciated by Toohey J, said:

"But I do not think that courts should be reluctant to

recognise the existence of exceptional cases. In

these days of extensive court delays and high legal

costs the courts should use all proper means to

encourage parties to consider carefully what matters

they will put in issue in their litigation. If

parties come to realise that they will not necessarily

recover the whole of their costs, even though they

have unsuccessfully raised a discrete issue, they are

likely better to consider whether the raising of that

issue is a justifiable course to take."

29. Where there is a mixed outcome in proceedings, the question of apportionment is very much a matter of discretion for the trial judge. Mathematical precision is illusory and the exercise of the discretion will often depend upon matters of impression and evaluation. His Honour's determination that in this case there should be no order as to costs was explicitly based upon his rough assessment of the time occupied at trial by the various issues in dispute. No reason for overturning the exercise of that discretion has been demonstrated and the Court is satisfied that the appeal fails on this ground also.

30. For the preceding reasons the appeal will be dismissed with costs.