the issue under sECTION 58
41 "Applicant" is defined in s 6 of the Act to mean "the person in whose name the application is for the time being proceeding". By the same section, the word "person" "includes a body of persons, whether incorporated or not." The application of 28 August 2003 was made in the name of Channel. Television argued that at the time of the application for registration, Network was the owner of the mark. Television argued further that the assignment of the trade mark application by Channel to Network in January 2004 did not 'cure' the defect in the registration. Television also argued that Channel was not the owner at the date of filing the application for registration. Television argued in the alternative that the evidence as to ownership of the mark at the time of registration was so confused that no finding could reasonably be made as to who was the real owner with the consequence that Network had failed to discharge the evidentiary onus which had shifted to it.
42 In support of these arguments, Television relied upon the following paragraphs of an affidavit sworn by Mr Lawrence on 31 October 2007:
1. I am the Founder and Managing Director of Food Channel Network Pty Ltd (The Food Channel) and am authorized to make this affidavit. [Network] is based in Queensland Australia.
…
5. In 1996, and with the advent of pay television being developed in Australia, The Food Channel trademark was created and a logo device attached to its name. In 1997 after filing the required documentation with our then solicitors MALLESON STEPHEN JACQUES which was then AIPO - (Australian Industrial Property Organisation) and after their search of the database that was conducted, it was concluded that there was no applications [sic] that had been filed or applications that were pending for the trademark - The Food Channel. The Food Channel trademark proceeded to registration without any opposition. The Food Channel is a REGISTERED AUSTRALIAN TRADEMARK - NUMBER 733265 - The Food Channel trademark has been registered in Australia since 1997 and is registered until 2017 when it again comes up for renewal. Annexed hereto and marked annexure H.
6. In 1998, The Food Channel created additional "The Food Channel" and "Food Channel" trademarks with logos and or a variety of fonts with "Food Channel" and The Food Channel" as the feature and began using them. There is no set formula in The Food Channel using the array of its trademarks. The Food Channel randomly uses the array of its trademarks throughout the course of its business and the services it provides.
…
9. The Food Channel is a company for the creation, development marketing, promotions implemented and distributed through multi media forms including but not limited to print, video production and distribution of programs using television, internet and websites of food and its associated industries in the entire food supply chain. The Food Channel creates recipes, writes articles, identifies news information, the creation of gardens of food from seedling to harvesting while reporting the progress in written form while also showing the progress and culmination of the harvest through visual moving images, produces cooking and food demonstrations, produces food videos, distributes beef, lamb, veal and other food products domestically and in international markets. The Food Channel was founded in 1997 and has been using its array of trademarks, is currently using all its trademarks and will continue to use all its trademark for the foreseeable future.
43 In other words, in this affidavit Mr Lawrence defined Network as The Food Channel and described all activities, in respect of trade marks and otherwise, as being carried out by The Food Channel. This founded Television's submissions to the judge that Network, not Channel, was the owner of the mark when Channel made the application for registration. We note that when Mr Lawrence swore this affidavit, he was attempting to represent Network in the proceeding (the trade mark application having been assigned from Channel to Network). Mr Lawrence was also the founder and sole shareholder and director of both Channel and Network. As the primary judge noted at [77] (quoted below), any distinctions Mr Lawrence drew between his own interests and those of his companies were few, confused and random. The difficulty confronting a man who acts as his own lawyer is proverbial. We mention this, not by way of criticism of Mr Lawrence or to suggest that he was entitled to some special consideration, but simply to make the point that his evidence cannot be regarded as composed of the precise and careful utterances which might be expected from a qualified lawyer.
44 The judge, applying the "shifting onus" approach urged upon her by Television's Counsel, came to the view that Television had made out a prima facie case that Channel was not the owner of the mark at the date of filing. On that basis, her Honour held that the onus of proof shifted to Network to establish that Channel was the owner of the mark at the time of application (at [38]). The judge said (at [46]):
I consider that it is also open on the facts for me to find that it is not possible to identify which of [Channel] or [Network] were the owner of trade mark 967804 at the relevant time. Accordingly, the evidentiary onus as to ownership shifts to [Network].
45 Later, the judge noted:
[77] The evidence before me is that Mr Lawrence tended to confuse his own business interests with those of his companies, and appeared to randomly use companies and trade marks depending on the circumstances. In this respect I consider that it is open on the facts to find that all companies controlled by Mr Lawrence were authorised to use trade mark 967804.
46 Her Honour went on:
[84] In summary, I do not consider that [Network] has discharged its evidentiary onus and established that [Channel] was the owner of trade mark 967804 at the filing date. In my view, while there is evidence to suggest that [Network] was the owner of trade mark 967804 both at the filing date and thereafter, the evidence also supports a conclusion that a finding as to ownership is not possible (other than, possibly, that the owner was Mr Lawrence himself). I consider that this is a defect in the application to register trade mark 967804.
…
[90] I note the submissions of [Network] that Mr Lawrence tended to confuse his own business interests with those of his companies. However in my view the policy of the Act is clear. Section 58 requires that, at filing date, the owner of the trade mark must be identifiable, and must be the applicant. As I have already observed, this does not mean that, within a corporate group, there cannot be transfer of ownership and assignment of the application within the group as is commercially necessary. However in my judgment there must at least be evidence of this, as well as compliance with the Act.
[91] "Ownership" is a key concept within the Act, requiring certainty. The policy of the Act is clearly to vest an owner of a trade mark with important rights and powers (cf for example sections 20, 21, 22, 27, 58, 58A). I do not accept that the Act sanctions a position such that a person who is not the owner of a trade mark can nonetheless apply for registration of a trade mark (and may thus be opposed under s 58), but the application itself is somehow subsequently validated by later identification of the owner and that owner being assigned the application by the trade mark applicant. In circumstances where the position of ownership is so confused that the owner of the trade mark cannot be identified at the filing date (or indeed throughout the application process as appears to be the case here as a result of the conflicting evidence as to ownership), the application may be opposed pursuant to s 58 of the Act.
47 The judge concluded her consideration of the s 58 ground of opposition in the following terms:
[92] In my view the respondent has not discharged its evidentiary onus. I am not satisfied in this case that [Channel] was the owner of trade mark 967804 at the filing date. While there is evidence that the respondent was the owner at the filing date, in my view the confusion in the evidence tendered by the respondent is too great for me to make a positive finding to this effect. However, even if the respondent were the owner at all times prior to and/or during the application process the defect in the original application is not cured by the assignment of the trade mark application to the respondent. This defect is fatal to the trade mark application. The applicant to these proceedings has substantiated its claim pursuant to s 58 of the Act.
48 If the evidence was not sufficiently clear to enable a finding of fact to be made about ownership of the mark at the time of registration then Television had to fail on that issue: it bore the onus of proof. The primary judge reached the opposite conclusion. Her Honour reached that conclusion, in part at least, because of the unnecessary distraction of Television's argument about shifting onus. There are a number of other reasons why we consider that her Honour erred in reaching that conclusion.
49 At common law, rights in a trade mark are established by use. The Act allows an applicant to obtain title to a trade mark prior to use, so long as the requirements in s 27 are met. Two requirements must be satisfied by an applicant who seeks to register a trade mark:
1. s 27(1)(a) requires that an applicant 'claims to be the owner of the trade mark', and
2. s 27(1)(b) requires that an applicant is either using or intends to use (or authorises or intends to authorise another to use) the mark in relation to the goods or services concerned.
50 The judge interpreted the requirement in s 27(1)(a) as being equivalent to proven, rather than claimed, 'ownership'. Her Honour said at [78]: "The application of s 27(1)(b)(ii) is only relevant if s 27(1)(a) is satisfied, namely that the trade mark applicant is also the owner." The terms of s 27(1)(a) do not support that approach.
51 McTiernan J explained in Shell Co of Australia Ltd v Rohm and Haas Co (1948) 78 CLR 601 (at 631):
the lodging of the application for the registration of [the mark] gave [the applicant] an inchoate title to that trade mark and an inchoate right to its exclusive use; the title and the right would cease if registration were refused, but if granted the title and the right would be confirmed and endure for the term of the registration. … For a very long time it has been a fundamental principle of the legislation providing for the registration of trade marks that the lodging of an application for registration gives to the applicant certain rights in respect of the user of the trade mark of which registration is sought.
52 In the same case, Dixon J said that (at 627):
The basis of a claim to proprietorship in a trade mark so far unused has been found in the combined effect of authorship of the mark, the intention to use it upon or in connection with the goods and the applying for registration.
53 In the United Kingdom, insertion of the phrase "claiming to be the proprietor" into the equivalent section of the Patents, Designs and Trademarks Act 1883 (UK) was considered to ameliorate the confusion over whether the previous Act did no more than provide for the registration of marks, 'proprietorship' in which had already vested via the common law, through use. So much was explained by Gummow J in Carnival Cruise Lines Inc v Sitmar Cruises Ltd (1994) 31 IPR 375 (at 385-6):
The phrase 'claiming to be the proprietor' had not appeared in the comparable provisions of the first of the modern British statutes, the Trade Marks Registration Acts 1875-1877 (UK). After the passage of the 1875 legislation, there had been doubts as to whether the legislation did no more than provide for the registration of marks already distinctive by reason of use and, as such, protected at common law, or whether it enabled a person who had coined a trade mark to obtain registration and treat that registration as equivalent to prior public use; see, eg Edwards v Dennis (1885) 30 Ch D 454 at 473, 479. The doubt was resolved in favour of the wider construction of the 1875 legislation by Re Hudson's Trade-Marks (1886) 32 Ch D 311 at 319-20, 325-6. In the meantime, s 62 of the 1883 statute had come into force. The introduction of the phrase 'claiming to be the proprietor' was treated in the Sebastian's, The Law of Trade Marks, 3rd ed, 1890, p 361, as having clarified the situation. The learned author said that 'By "claiming to be the proprietor" nothing more is meant than "claiming to be the first to adopt", whether there has been any user or not'. He added that 'Since by s 77 a trade mark cannot be protected until either it has been registered or registration has been refused, it hardly seems that there can be any effective proprietorship until registration has been granted…'
54 Each of Mr Lawrence, Network, and Channel could have satisfied the basic requirement in s 27(1)(a) in the sense that, from the admittedly imprecise affidavit of Mr Lawrence, it could be inferred that each could 'claim' to be owner of the mark.
55 Section 58 of the Act provides that registration of a trademark may be opposed on the ground that the applicant is not the owner of the mark. In this context, the term 'owner' derives meaning from its common law origins relating to prior use. As explained in Shanahan's Australian Law of Trade Marks And Passing Off (4th Ed) (at 380):
The first user is the person entitled to claim to be the owner and if the applicant is shown not to be the first user, the ground of opposition will be established.
56 In Lomas, Cooper, Kiefel and Emmett JJ said:
[39] The question of substance that is raised by the proceeding is what constitutes a use or user of a trade mark for the purposes of the statutory concept of ownership of the mark prior to registration. It is not necessary that there be an actual dealing in goods bearing a trade mark before there can be said to be use of that mark as a trade mark in Australia. For example, there may be use where goods intended to be imported into Australia have not actually reached Australia but have been offered for sale in Australia under the mark. It may even be possible to establish use where the mark has been used in an advertisement of goods in the course of trade in circumstances where there is an existing intention to offer or supply goods bearing the mark in trade or there is an actual trade or offer to trade in the goods bearing the mark - Moorgate Tobacco Co Ltd v Phillip Morris Ltd and Anor [No 2] (1984) 156 CLR 414 at 433-434. However, where there is no actual trade or offer to trade in goods bearing the relevant mark in Australia or any existing intention to offer or supply such goods in trade, but merely preliminary discussions and negotiations about whether the mark would be so used, there is no use so as to constitute ownership of the mark (see Moorgate Tobacco (No 2) at 434).
…
[45] We are not persuaded, on the balance of probabilities, that the Advertisement by itself can be characterised as a use of the Trade Mark in relation to country kitchen services in the course of trade, such that it is possible to identify an intention, existing before the Priority Date, to offer or supply country kitchen services using the Trade Mark. That is the only basis advanced by Winton and the Company in support of the contention that Winton and not Mrs Lomas was the owner of the Trade Mark as at the Priority Date within the principles of the Shell Co Case. Further, we are certainly not persuaded that the Application should clearly be rejected on the ground that Ms Lomas was not the owner of the Trade Mark as at the Priority Date.
57 In practice, s 58 is usually invoked by a party with a competing claim to ownership (in the sense that they have demonstrated prior use of the mark) to remove a mark from the register. This was recognised by the judge:
[31] … s 58 is conventionally used as a ground of opposition where disputing parties have had a business or contractual relationship, and are in dispute as to which of those parties is the true owner of the mark (Shanahan's Australian Law of Trade Marks and Passing Off (4th ed, Lawbook Co, 2008) p 380, cf Elkington B, Hall M, Kell D, Trade Mark Law in Australia (Butterworths, 2000) p 77).
58 Her Honour recognised that this will not necessarily always be so:
[31] … s 58 does not confine opposition to registration of a trade mark to a party itself claiming ownership of that trade mark. Examples of cases in which claims - albeit unsuccessful - were made by a third party against the registered owner of a trade mark pursuant to s 58 are Global Brand Marketing Inc v YD Pty Ltd (2008) 76 IPR 161 and Mobileworld Communications Pty Ltd v Q & Q Global Enterprise (2003) 61 IPR 98. Indeed in this case the respondent has not disputed the standing of the applicant to oppose registration of trade mark 967804 on the ground of s 58.
59 The judge relied upon two of Television's arguments to substantiate its claim under s 58. First, that there was evidence Network was the owner (through prior use), and secondly, that there "is considerable confusion in relation to ownership of trade mark 967804 at the filing date, so that it may be impossible to make a positive finding in favour of either [Channel] or [Network] as to ownership." (at [45]).
60 The judge relied upon the sections of Mr Lawrence's affidavit reproduced above. There is no other evidence referred to in her Honour's judgement relating to this point. The strongest part, as far as Television is concerned, appears at [6] of Mr Lawrence's affidavit:
In 1998, The Food Channel created additional "The Food Channel" and "Food Channel" trademarks with logos and or a variety of fonts with "Food Channel" and "The Food Channel" as the feature and began using them. There is no set formula in The Food Channel using the array of its trademarks. The Food Channel randomly uses the array of its trademarks throughout the course of its business and the services it provides.
61 The courts should be cautious to allow the legal fiction of the corporate veil to defeat registration in a case where one of a group of companies, all controlled by the same directing mind and will, used the mark prior to the other. This is particularly so where, as here, the conclusion that the words The Food Channel in Mr Lawrence's affidavit meant Network and only Network depends on a single opening definition in an affidavit drafted by a layperson, in a case where Network was the sole respondent attempting to answer a notified ground of opposition that Network was not the owner of the mark, and where any distinctions Mr Lawrence drew between his companies were few, random and confused. In this case, this evidence does not establish that Network was the prior owner through use. It may establish that Network used the mark at a time before registration, but it doesn't negate the possibility that Channel was, in fact, also a user (and indeed the first user) of the mark before registration. Further, there is no evidence as to how the mark was used by Network. Use needs to be in relation to the goods or services claimed; on the only evidence before the Court, there was "no set formula" with regard to use. This tends against a conclusion that any mark was used by Mr Lawrence, Network or Channel to distinguish one company's goods from another. Finally, the requirement of prior user as a trademark is that it is used to distinguish one's goods from another's: if Network did use the mark, there does not seem to be evidence of an attempt to use it in such a manner as to distinguish its goods from those of Channel. And of course, it is inherently unlikely that Mr Lawrence, as the directing mind and will of both companies, would have had any such an intention.
62 To treat Mr Lawrence's statement that Network 'created' and 'used' the mark as exclusive of permitted use by Channel is counter-intuitive, given her Honour's observation at [77] that the "evidence …is that Mr Lawrence tended to confuse his own business interests with those of his companies, and appeared to randomly use companies and trade marks depending on the circumstances...".
63 Whether Channel had demonstrated ownership through use, her Honour's conclusion was that any use demonstrated (use on menus, recipes, letterhead etc) was not in relation to the class for which the mark was registered:
[65] … None of these uses appear to be with respect to "printed publications" within class 16 in relation to which application for registration of the trade mark was made. I do not consider that the respondent has demonstrated use by [Channel], which was the trade mark applicant of trade mark 967804, as a trade mark so as to establish ownership through use.
64 We will deal with this finding further in due course, but for present purposes it is sufficient to say that this is a further manifestation of the confusion that has resulted in this case from the unnecessary search which Television urged on the primary judge for an 'owner' (by reason of use) at the time of registration; the Act provides for registration even without use. Further, what is being looked for is prior use such that it defeats the applicant's claim to ownership. If, on the evidence, there was no prior use of the mark in relation to goods in class 16, then Television's opposition under s 58 must fail.
65 As to her Honour's conclusion that there was so much confusion regarding the mark that no true owner could be discerned, her Honour recounted the following evidence, at [45]:
1. Evidence that trade mark 967804 was apparently used by both [Network] and [Channel] in relation to menus (which are within the specification of trade mark 967804).
2. Evidence that the menus exhibited by [Network] which purportedly bear trade mark 967804 have a copyright notice in the name of "The Food Channel", and that at least two menus actually refer to [Channel] (Annexures X and Y to the affidavit of Paul Lawrence sworn 31 October 2007).
3. Evidence that a television licence agreement upon which [Network] relied as evidence of its use of trade mark 967804 was a licence agreement entered into by [Channel] (Annexure D to the affidavit of Paul Lawrence sworn 31 October 2007).
4. Evidence that recipes purporting to bear trade mark 967804 are in the name of "The Food Channel" and display [Channel's name] and its ABN 16 077 987 118 (Annexure F to the affidavit of Paul Lawrence sworn 31 October 2007).
5. Evidence that recipes purporting to bear trade mark 967804 have a copyright notice in the name of "The Food Channel" (Annexure J to the affidavit of Paul Lawrence sworn 31 October 2007).
6. Evidence that [Network] relied on various letterheads as evidence of use of trade mark 967804, but that all of the letterheads were of [Channel] (ACN 077 987 118 and ABN 16 077 987 118) (Annexure L to the affidavit of Paul Lawrence sworn 31 October 2007).
66 Far from establishing a prima facie case that another party used the mark prior to registration, these pieces of evidence suggest that it was, indeed, Channel that used the mark. In any event, a finding that there was considerable confusion over who owned the mark means that this ground of opposition must fail given the onus on Television to establish any ground of opposition.
67 Section 27(1)(b) of the Act requires that the applicant use or intend to use, or authorise use or intend to authorise use of, the trade mark. The time at which this intention must exist is the date of application (in this case 28 August 2003). Only a very low threshold has been set with regard to intention to use in that the very act of making the application is, without more, sufficient to establish the requisite intention. In Aston v Harlee Manufacturing Co (1960) 103 CLR 391 Fullagar J said (at 401, footnote omitted):
There is another element mentioned by Dixon J in the Shell Co.'s Case, which is stated as essential to the proprietorship of an unused trade mark. That element is the intention of the applicant for registration to use it upon or in connexion with goods. As to this I need only say that I do not regard his Honour as meaning that an applicant is required, in order to obtain registration, to establish affirmatively that he intends to use it. There is nothing in the Act or the Regulations which requires him to state such an intention at the time of application, and the making of the application itself is, I think, to be regarded as prima facie evidence of intention to use. I cannot think that the Registrar is called upon to institute an inquiry as to the intention of any applicant, and I think that, on an opposition or on a motion to expunge, the burden must rest on the opponent or the person aggrieved, of proving the absence of intention.
68 Fullagar J went on to say (also at 401):
A manufacturer of (say) confectionery would, I should suppose, be entitled to register three trade marks in relation to confectionery, though he intended only to use two of them and had not made up his mind as to which two he would use. … On the other hand, a manufacturer of confectionery, who had no intention of ever manufacturing motor cars, might be held disentitled to register a mark in relation to motor cars…
69 The position has changed somewhat since the decision in Aston in that s 92(4)(b) now provides for the removal of a mark that has not been used for three consecutive years, however there is no suggestion that this section applies in this case.
70 Given the available inference of use from the fact of application for registration, and the absence of evidence to rebut that inference, the Registrar's delegate correctly concluded that Channel was entitled to register the trade mark 967804.
71 In conclusion in relation to the ground of opposition under s 58 of the Act, we consider that on the very limited evidence before the court as to the way in which the mark was used before the date of registration, it well may be said that both Network and Channel used the mark, but it cannot be said that Network rather than Channel was the first party to use the mark as a trade mark in relation to goods in Class 16 or at all. And it cannot be said that Channel was not the first party use the mark in such a way. In this state of confusion, the incidence of the onus of proof means that the lack of clear evidence as to prior use is a fatal deficit in the opponent's case, not in the applicant's.