Passing Off - Whether goods of respondent were passed off as those of appellant.

Trade Practices Act 1974 s.52

Counsel for the Appellant: Mr. R.V. Gyles, Q.C. and Mr.

A.J. Sullivan

Solicitors for the Appellant: Esplins

Counsel for the Respondent: Mr. D. Shavin

Solicitors for the Respondent: Freehill, Hollingdale & Page

The order of Gummow J. dismissing the application be set aside and in lieu thereof it be ordered that:

(a) the respondent, by its servants or

agents, be restrained from selling or

offering for sale any dry-fry pan with

lid in packaging upon which the words

"dry-fry convection oven pan with lid"

are set out in lettering substantially

similar to the lettering for those words

used by the applicant on its package,

exhibit C;

(b) an account be taken of the profits

derived by the respondent from its sales

of such dry-fry pans in packages similar

to exhibit D;

(c) the matter be remitted to Gummow J for

the taking of that account; and

(d) the respondent pay the costs of the

applicant of the application.

The respondent pay to the appellant its costs of the appeal.

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

This is an appeal from a judgment of a Judge of this Court (Gummow J.) in which it was ordered that the applicant's application to this Court be dismissed with costs and that a cross-claim brought by the respondent be also dismissed but that the applicant pay the respondent's costs of the cross-claim. There is no appeal in respect of the orders made by his Honour in relation to the cross-claim.

2. Hereafter I shall refer to the appellant as "Telmak" and to the respondent as "Coles". For many years, Telmak has marketed a number of products throughout Australia. Many of these products have been items of kitchenware. In 1986 Telmak began to market what may be described shortly as a dry-fry pan. The pans are intended to be used on the tops of stoves (electric or gas) but to cook as an oven by a method of convection heating which it is unnecessary to describe. The pans have lids which must be on for them to work as intended. They have non-stick surfaces.

3. The pans are manufactured in Australia and are packed in boxes which on their faces prominently display the pan and lid and contain at their tops the words "DRY-FRY CONVECTION OVEN PAN with LID". The words "DRY-FRY" are the most prominent, the type for them being approximately three centimetres high. The remaining words are in smaller, but nevertheless prominent, type. The type is white in colour against a dark brown background. Underneath is a grey line followed by claims that the pan will bake a cake evenly on a stove top and can be used to cook "fat-free dry roasted nuts, etc." There then appear coloured photographs of the pan and lid and some information about the nature of the material with which the pan is made. Underneath are three smaller pictures of dishes which have either been cooked or are ready to be cooked in the pan. The Telmak name appears in a square in the right-hand bottom corner of the top of the lids. The bottoms of the boxes are got up in a similar fashion to their tops. Two of their sides also have a similar get up. The words, "Dry-fry convection oven pan with lid" (hereafter referred to as the "Telmak words"), occupy about ten per cent of the tops and bottoms of the boxes and about one third of each of the two sides on which there is writing.

4. Between 1986 and 1988 Telmak engaged in an intensive marketing campaign which it conducted mainly through television advertising in all States of Australia. Over 115,000 pans were sold. Many of these were sold directly by Telmak to customers. Others were sold through stores, the names of which appeared at the end of some of the advertisements. Only in Western Australia were pans sold in Coles stores.

5. Coles is the largest retailer in Australia. It operates a number of chains of stores. One of these chains is K-Mart. Pans sold by it were sold at K-Mart stores.

6. Coles began to market dry-fry pans in a number of K-Mart stores late in May 1988. These were imported from Taiwan. They were for sale at prices ranging from approximately $15 to $18. The Telmak pans were much more expensive, selling as they did for about $40. The pans were marketed in boxes of a similar size to the boxes in which Telmak's pans were marketed. The pans themselves were of a similar size and shape, but the Coles' pans were of a different colour. The boxes had printed prominently at their tops words identical with the Telmak words, namely, "DRY-FRY CONVECTION OVEN PAIN (sic) with LID". The print used was slightly different from that used on the Telmak boxes but was set out in much the same way. The most prominently displayed words were "dry-fry". The letters were also three centimetres high. The remaining words were in smaller, but nevertheless prominent type similar in size to the type used in relation to the same words on the Telmak packaging. Like the words on the Telmak boxes, they were set out so that the word "convection" was printed above the remaining words. The printing of the words "dry-fry" was in white, but the remaining words were printed in red. All the words appeared against a white background. As in the case of the Telmak words, the Coles' words occupied about ten per cent of the tops and bottoms of the boxes. They occupied the whole of two sides of the boxes. Underneath the words at the top of each box there was further material printed in less prominent letters. It was said that the fry pan was non-stick and had a baked enamel finished exterior and a diameter of 25 centimetres. The pan and lid were depicted on the box. The exterior was blue in colour and the interior apparently grey. Unlike the Telmak product, the Coles' product bore no brand name nor any information which would enable one to determine the manufacturer of the pans, but on one of the sides of the boxes it was said that the pans had been made in Taiwan.

7. When Telmak learned of Coles' marketing of its pans, it sought injunctive relief. The interlocutory proceedings were disposed of on the basis of Coles giving appropriate undertakings and the matter proceeded to a final hearing on 25, 26 and 27 July 1988. His Honour gave judgment on 5 August 1988 and, as I have said, dismissed the application.

8. The causes of action relied upon by Telmak were passing off and breach of s. 52 of the Trade Practices Act 1974. The question at issue in relation to both causes of action raised for decision before his Honour and before us the question whether Coles' conduct has involved it in making a misrepresentation. That raises a further question, namely, whether Telmak has established that it has a reputation or goodwill in its packaging or part thereof. Telmak's case was that the Telmak words, which were reproduced on the Coles' packaging, were distinctive of its product. His Honour found that they were not.

9. What Telmak complained of was the use by Coles of the Telmak words, not simpliciter, but in precisely the same order, set out in precisely the same way in type of a similar size and style, all in relation to a substantially similar product. Counsel for Telmak emphasized that his case was not based on the words alone but on the form of Telmak's get up which consisted of the words, the order in which they appeared, the size and style of their printing and their position on the boxes. They said that in the two years in which Telmak had marketed the pans, this aspect of the get up of its boxes had become distinctive of its packaging and thus its product. The use by Coles of a closely similar get up should lead the Court to find that customers or potential customers would be led to believe that the Coles' pans came from Telmak or, if not Telmak, from the same supplier as the Telmak pans, whoever that supplier might be.

10. As might have been expected, one of the matters strongly relied upon by Coles before his Honour was the fact that the words complained of were ordinary English words which were descriptive of the product sold, that is, the pans. There was no "fancy" or made up word used nor did the use of the words make them, when considered together, in any way special. In Coles' submission, notwithstanding the prominence with which they were displayed, they were no more than a description of the product inside the boxes and the functions of them.

11. Counsel for Telmak conceded the force of these considerations. But they relied on a passage from the judgment of Lord Scarman, who delivered the judgment of the Judicial Committee of the Privy Council in Cadbury-Schweppes Pty. Limited v. Pub Squash Co. Pty. Limited (1981) 1 WLR 193. Lord Scarman referred (at pp 199-200) to what Stephen J. had said in Hornsby Building Information Centre Pty. Limited v. Sydney Information Centre Limited [1978] HCA 11; (1978) 140 CLR 216 at p 229. He continued (at p 200):-

"He (Stephen J.) is discussing a name: but

what he says about a name may with equal

force be applied to other descriptive

material, if it has given to a product (or

business) a distinctive character.

The width of the principle now

authoritatively recognised by the High Court

of Australia and the House of Lords is,

therefore, such that the tort (of passing

off) is no longer anchored, as in its early

19th century formulation, to the name or

trade mark of a product or business. It is

wide enough to encompass other descriptive

material, such as slogans or visual images,

which radio, television or newspaper

advertising campaigns can lead the market to

associate with a plaintiff's product,

provided always that such descriptive

material has become part of the goodwill of

the product. And the test is whether the

product has derived from the advertising a

distinctive character which the market

recognises. But competition must remain

free: and competition is safeguarded by the

necessity for a plaintiff to prove that he

has built up an 'intangible property right'

in the advertised descriptions of his

product: or, in other words, that he has

succeeded by such methods in giving his

product a distinctive character accepted by

the market. A defendant, however, does no

wrong by entering a market created by another

and there competing with its creator. The

line may be difficult to draw: but unless it

is drawn, competition will be stifled."

12. It follows from what his Lordship said that there will be cases where an applicant for relief will succeed in establishing goodwill or reputation in ordinary English words which are descriptive of the nature and purpose of the applicant's product. But such cases will have about them some special features or circumstances and are unlikely to be numerous.

13. Gummow J. concluded that the evidence showed that there was not the identification with the Telmak product of the expression "Dry-fry convection oven pan with lid" which Telmak was required to establish if it was to make out its case. On the basis of evidence which his Honour accepted, he also said:-

"The effect of this body of evidence (an

effect supplemented and reinforced by other

evidence I consider later in these reasons

which deals with the history of dry fry

product promotions in recent years) is that

Telmak has not established the necessary

distinctiveness in respect of the phrase use

of which, by Coles Myer on its product,

Telmak seeks to prevent. I appreciate that a

large number of units have been sold in a

package which does display the phrase in

question. However, the evidence spells out

what one otherwise would have suspected,

namely that the public and the trade use more

succinct expressions as a means of

identifying the Telmak product, and that the

television advertisement is used as a primary

reference point for identification."

His Honour referred to the detail of this evidence. I do not find it necessary to refer to it further. It plainly established what his Honour said it did.

14. Notwithstanding the strong submission made by counsel for Telmak that his Honour's conclusions took account only of the words and their order and failed to give sufficient weight to the matters he relied upon in relation to get up, I find it difficult to disagree in any respect with what his Honour has said. The facts that the words are ordinary English words and are descriptive of the products of the two parties may not be conclusive of what the outcome of the appeal should be, but they are all-important circumstances which must be kept firmly in mind. Counsel for Telmak emphasized the get up as a whole. But the words are a prominent part of the get up upon which counsel rely and must therefore have substantial relevance in the overall consideration of the matter. In relation to get up, I think, contrary to the thrust of counsel's submissions, that it would be wrong to look only at so much of the packaging of the two products as consists of the words in question. The entirety of the get up needs to be considered. As mentioned, the words occupy 10 per cent of the tops and bottoms of the two boxes. The rest of the material on the boxes contains substantial differences. The products which are depicted thereon are closely similar, but they are depicted in different colours and the photographs of them taken from different angles; and whilst the Telmak boxes make claims for the type of cooking for which its pans may be used, the Coles' boxes describe the nature of the finish which its products have. Additionally, the Telmak boxes show dishes prepared, or already cooked, for which its pans may be used. No similar display appears on the Coles' boxes. The similarities caused by the use of the Telmak words in precisely the same order on each box in type or print of the same size constitute an important factor. But, even so, the colour of the type is not the same; it is entirely white in the case of the Telmak boxes, and partly white and partly red in the case of the Coles' boxes.

15. I repeat that at the heart of the case are the Telmak words which are descriptive of what each of the boxes contains. In those circumstances I am not persuaded that the words got up in the way which has been described are sufficiently distinctive of the Telmak product to warrant a finding that Telmak has the goodwill or reputation in them which it must establish it has before it is entitled to succeed.

16. There is a further factor. His Honour made the point - I have referred to it earlier - that customers would be unlikely to identify the Telmak pan by reference to the Telmak words. Even the Telmak witnesses did not use them when referring to it in ordinary conversation. To use an expression, they were somewhat of "a mouthful". Furthermore, they were not prominently featured in Telmak's television advertising. A video of the advertisement in evidence shows the Telmak box, and thus the Telmak words, fleetingly before the pan itself is displayed and claims for what the pan will do are made. This is what occupies most of the time of the advertisement. In those circumstances it might have been expected, as indeed the evidence established to be the case, that what potential customers would be interested in was the fact that the pan was a dry-fry pan but could be used as an oven although on a stove top. As indeed happened, they would be most likely to ring up Telmak or to go into a store stocking the Telmak pan and ask for the pan they had seen advertised on television. Except in Perth, no customer would be likely to see the two products in the same store. K-Mart did not stock the pans anywhere except in Perth where 750 of the Coles' pans were also for sale. It seems most unlikely to me that any customer seeing the Telmak pan in a shop other than a K-Mart shop, where the two products might be seen in close proximity, would be particularly drawn by the Telmak words and the way in which they were got up. In that situation a customer's curiosity might well be aroused. Two closely similar products would be on display each bearing the Telmak words in the way I have described, but the one priced at about $15 and the other at about $40. One product would bear the Telmak name and be shown as having been made in Australia; the other would have no name and be shown as having been made in Taiwan. In those circumstances, customers would be likely to be confused. Some might be actually misled into thinking that the two products, despite their respective places of manufacture, came from the same source. But that circumstance does not touch the question whether Telmak has established goodwill or reputation in the words and get up in question. For reasons which I have given, I am of opinion that it has not.

17. Counsel for Telmak, however, relied on two further matters in support of their case. The first of these was a finding by his Honour that an executive of Telmak telephoned nine K-Mart stores on 1 June 1988. In each case she told the telephonist she wished to make an inquiry about a kitchenware product. She was connected to the kitchenware department of each store and in each case asked, "Do you have any of those dry-fry pans which I have seen advertised on television?" In each case the response to the question was in terms connecting the Coles' product with that sought by the questioner. It is common ground that the Coles' pans were never advertised on television. It was counsel's submission that in this way employees of Coles engaged in misleading conduct but his Honour said:-

"There may be innocent explanations of what

transpired on these occasions. The matter

was not pursued in any detail before me.

Nevertheless, one would expect that steps be

taken, if they had not already been taken, by

Coles Myer to ensure that its sales staff not

respond to questions of this character so as

to mislead the questioners into the belief

that if they purchased the K-Mart product,

they would be purchasing the product they had

seen advertised on television."

18. I do not think that the evidence which his Honour accepted reflects great credit on Coles, but I think, for the reason which he has given, that this evidence ought not to form the basis of any relief for Telmak. It really involves a different case from that essentially relied upon by Telmak. In any event, I would not be prepared to take a different view from his Honour in circumstances where the matter in question was not fully pursued before him.

19. The next matter upon which Telmak relies is of greater moment. I have so far dealt with the case on the basis that there was no evidence of deliberate copying by Coles of the Telmak get up and no attempt by Coles to market its pans in order to take advantage of the Telmak advertising campaign. In September 1987 Mr. Stapleton, who was the controller of kitchenware and plastic ware for certain stores in the Coles Myer group, including K-Mart stores, visited Taiwan. He said that he was then unaware of the Telmak product, but was aware of dry-fry pans in a general sense. Mr. Stapleton went to Taiwan to buy new products. This was something he did regularly. Customarily he bought about 200 new products on each trip. K-Mart stores stock approximately 2,000 different products in their kitchenware and plastic ware departments.

20. In Taiwan Mr. Stapleton was shown a sample of a new design for a dry-fry pan. Coles had had a previous unfortunate experience with a similar product, but he agreed to try a small quantity. Mr. Stapleton agreed that the fundamental parts of the product which he then ordered were basically identical with the Telmak product.

21. The order, which was for 3,600 pans, was placed in writing. It was dated 5 September 1987. The shipping schedule indicated that some pans would go to Melbourne, some to Sydney, some to Brisbane and some to Perth. The pans were described as "non stick dry fry pans". Written on the form were the words, "Promote June CAT". His Honour accepted Mr. Stapleton's evidence that his objective was that the product be promoted in the June catalogue which was scheduled to appear in the ordinary course at the beginning of June 1988.

22. In October 1987, Mr. Boucher, a kitchenware buyer for K-Mart stores, was approached by Mr. Recsei, the General Manager of Telmak, who had the responsibility for marketing and selling the Telmak product range. The two had discussions in Melbourne concerning the possible purchase by Coles of the Telmak pan. Coles had sold other Telmak products and its officers knew of the use of television to advertise Telmak products. On 26 October 1987, Mr. Recsei wrote to Mr. Boucher referring to Telmak's advertising campaign and the advantages of it.

23. Eventually Mr. Boucher, after a conversation with Mr. Stapleton, told Mr. Recsei that the Telmak pan was too expensive and that the merchandising budget of Coles was already committed in relation to other products. Mr. Boucher had shown Mr. Stapleton the packaging for the Telmak product that had been left with him by Mr. Recsei. In an affidavit sworn on 7 June 1988 Mr. Stapleton said that it had not occurred to him at the time Mr. Boucher showed him the packaging for the Telmak pan that Telmak could claim any exclusive rights to what I have earlier referred to as the Telmak words. Mr. Stapleton said that, when he examined the packaging, he looked only at the photographs of the product and did not pay any regard to the wording thereon. He denied that he turned his mind at that time to any entitlement of Telmak to have the exclusive right to use the Telmak words. After referring to this evidence, his Honour said:-

"However, I have reached the conclusion that

Mr. Stapleton did examine the packaging for

the purpose of making a comparison between

the product and description found on the

packaging and the product he had ordered the

previous month in Taiwan, all with a view to

reaching the decision which he communicated

to Mr. Boucher for transmission to Mr. Recsei

that Coles Myer was not interested in

purchasing the Telmak dry fry pan.

Although, in general, I accept Mr.

Stapleton's evidence, there were occasions

where his memory appeared to contract, expand

or otherwise respond to what he perceived to

be in the witness box an attack upon him or

the interests of his company. This was one

such occasion. The conclusion I have so

expressed was influenced by his demeanour as

well as his answers. It is also consistent

with the terms of his affidavit."

24. Mr. Boucher had the task of approving the sample art work sent from Taiwan. This arrived either in December 1987 or January 1988. The sample was not in evidence. Mr. Boucher remembered that the word "pain" rather than "pan" was used. He said he instructed the Taiwanese buying agent to make sure that this was corrected. For whatever reason, the correction was not made.

25. His Honour referred to evidence given by Mr. Boucher in the course of his cross-examination, namely:-

"Of course, you know, do you not, that the

exact words - the name of your product is

exactly the same on the box as the Telmak

product? --- That transpires now. It did not

register at the time, of course.

Why 'of course', Mr. Boucher? --- No reason.

What I am saying is it did not register at

the time."

"I was adversely impressed by Mr. Boucher's

demeanour during cross-examination on this

topic. Mr. Boucher gave evidence which in

general I accept, but on this issue I believe

his recollection was distorted by a desire to

assist the interests of his company's case.

I find that he did still have in mind the

draft packaging given him by Mr. Recsei in

October and the language on that packaging."

27. On 17 February 1988 Mr. Stapleton notified Coles' Advertising Department that the K-Mart pan was to be advertised in the catalogue for the week commencing 30 May 1988. The written notification described the product as, "Non stick dry fry pan slate blue or red". In the brochure, as it eventually appeared, the description was, "Non stick dry fry pan for easier cooking. Choice of blue or red." Estimated sales were shown as 2,500 units. The wording on the draft packaging was not used nor were the words which appeared on the actual boxes containing the pans.

28. Mr. Stapleton gave evidence, which his Honour accepted, that his first recollection of seeing television advertising for the Telmak product was in Melbourne on two occasions in June 1988 after the proceedings had been commenced. He conceded that he might have seen it before, but could not recollect having done so. His Honour said:-

"In my view, Mr. Stapleton did not act in any

way over this period which indicates that the

labelling of the Coles Myer product was

either devised by him or adopted by him after

it was devised in Taiwan, with a view to his

company deriving or possibly deriving a

benefit from the circumstances that the words

'Dry-Fry Convection Oven Pan With Lid'

appeared on the Telmak product. I have found

that he did examine the Telmak packaging, but

accept that he regarded the expression in

question as containing descriptive elements

commonly understood as such."

"That is not to say Mr. Stapleton was

unconscious of the advantage of marketing a

product that closely resembled the Telmak

product in appearance and function. But when

in February 1988 he notified the advertising

department of the description of the product,

it was not with the cumbersome phrase on the

Telmak box, but with the words 'non stick dry

fry pan'. I might add that the 'non-stick'

element in this description is not given any

such specific force in the Telmak expression.

In these circumstances, Mr. Stapleton lacks

the necessary intention for attribution to

Coles Myer so as to satisfy Telmak's

proposition of law concerning intent, namely

that because Coles Myer used exactly the same

words to describe its product, the correct

inference is that it intended by this means

to mislead or deceive the public into

believing its product was that of Telmak."

29. His Honour then referred to evidence of how it was that Coles came to market the Telmak pans in its Perth stores. On 27 April 1988 Coles placed an order for 750 of the Telmak pans and thereafter 750 were delivered to designated K-Mart stores in the Perth metropolitan area. Mr. Boucher said that he accepted the Telmak proposal because it could not result in any loss to Coles. Television advertising in Perth occurred on 15 occasions between 29 May and 3 June 1988. His Honour said that it followed that in March 1988 (when the proposal to sell Telmak pans in Perth K-Mart stores was mooted), Coles knew that it would be selling an almost identical competing product at a much lower price than the similar product which was heavily promoted by Telmak on television.

30. His Honour said that Mr. Boucher gave evidence that he "did not connect" the two products, because the differences in price led him to classify them in his mind as different items. He denied that the real reason for placing the order with Telmak was to take advantage of the television campaign planned for Perth. Of this evidence his Honour said:-

"These are further instances in which I

regard Mr. Boucher's evidence as unreliable.

I find he did have in mind, in placing the

order for the Telmak product, the advantages

of the television promotion in attracting

potential purchasers of dry fry pans into

Coles Myer stores where there was also to be

available a dry fry pan at a much cheaper

price than that for the Telmak product. But

that is not to say that the respondent

adopted or acquiesced in the adoption in

Taiwan of the same expression on the

packaging as that appearing on the Telmak

product so as by this means to mislead or

deceive the public into believing the Coles

Myer product was that of Telmak."

31. His Honour added that, to Mr. Boucher, the attractive force that would bring in custom to K-Mart stores was not the wording on the Telmak packaging, but the appearance and function of the goods and the effect of the television advertising. His Honour said:-

"Again, therefore, Telmak has failed to

establish the necessary factual basis for its

submissions that Coles Myer adopted for its

product packaging the same wording as

appeared on the packaging of the Telmak

product . . . in the hope or expectation of

deriving a benefit from that circumstance."

32. Before his Honour and before us counsel for Telmak submitted that the evidence gave rise to the irresistible inference that Coles or its Taiwanese agent (with Coles' knowledge) exactly and deliberately copied the name of the product and the Telmak get up used in relation to it. By name of the product, counsel meant the descriptive words which are in question here, namely, what I have referred to as the Telmak words. Counsel posed the rhetorical question, namely, unless the name and its get up had become distinctively associated with Telmak's product what was the point in a large, experienced retailer such as Coles so exactly copying it?

33. In support of their argument, counsel referred to a number of well known authorities. In Claudius Ash, Sons and Co. Limited v. Invicta Manufacturing Co. Limited (1911) 28 RPC 597, Cozens-Hardy M.R. said, in the course of argument (p 603):-

"If you find a defendant who is a knave, you

may presume he is not a fool."

The Claudius Ash case was a case involving the infringement of a trade mark and passing off.

34. In Office Cleaning Services Limited v. Westminster Window & General Cleaners Limited (1946) 63 RPC 39 Lord Simonds said (at p 42):-

" . . . I observe that here there is in the

Respondents' choice of name no improper or

sinister motive. The learned judge found

that they did not intend to cause confusion

between their business and that of the

Appellants by dropping the word

'Westminster'. This is not a matter of

conclusive importance. Confusion innocently

caused will yet be restrained. But if the

intention to deceive is found, it will be

readily inferred that deception will result.

Who knows better than the trader the

mysteries of his trade?"

35. Finally, counsel referred to Australian Woollen Mills Limited v. F.S. Walton & Co. Limited [1937] HCA 51; (1937) 58 CLR 641 where Dixon J. (as he then was) and McTiernan J. said (p 657):-

"The rule that if a mark or get-up for goods

is adopted for the purpose of appropriating

part of the trade or reputation of a rival,

it should be presumed to be fitted for the

purpose and therefore likely to deceive or

confuse, no doubt, is as just in principle as

it is wholesome in tendency. In a question

how possible or prospective buyers will be

impressed by a given picture, word or

appearance, the instinct and judgment of

traders is not to be lightly rejected, and

when a dishonest trader fashions an implement

or weapon for the purpose of misleading

potential customers he at least provides a

reliable and expert opinion on the question

whether what he has done is in fact likely to

deceive. Moreover, he can blame no one but

himself, even if the conclusion be mistaken

that his trade mark or the get-up of his

goods will confuse and mislead the public."

36. Counsel submitted that, when an experienced retailer knowingly marked a commodity with a name, and the get up of a name, exactly identical with the name and get up of "the then market-leading product", the only inference available was that it was doing so because it perceived some advantage in doing so, namely, that consumers or potential consumers would associate its product with that of "the market leader". Counsel said that such conduct provided the clearest possible evidence that the name and get up had become distinctive of Telmak's product.

37. In support of their submissions counsel referred to evidence given by Mr. Stapleton and Mr. Boucher in addition to that dealt with by his Honour. They first referred to statements made by the two that the similarity of the products, their names (this being a reference to the Telmak words) and their get up were mere coincidence. For instance, Mr. Stapleton agreed, albeit with hindsight, that there was a remarkable coincidence between the name of the Coles' product and the name of the Telmak product and the form of the printing of the two names. In passing I should mention that at this point he conceded that Coles' agents in Taiwan may have copied the name (i.e. the Telmak words). He said he had not asked the agents because the matter did not "particularly worry me".

38. An example of Mr. Boucher's evidence on the matter of coincidence is to be found in the course of his cross-examination, namely:-

"Did you take any steps to send off the

packaging received from Mr. Recsei to anyone

overseas? --- Most definitely not.

Did you give it to anyone to take overseas?

--- Most definitely not.

Are you just - it was an enormous

coincidence, do you say, that your product

has exactly the same name as the Telmak

product? --- That is right.

An enormous coincidence? --- Exactly right.

It is just an enormous coincidence, is it,

that the style of writing and the setting out

of the writing is also exactly the same, is

it? --- That is how it appears to me."

Later Mr. Boucher reiterated his view that the similarities resulted from nothing but coincidence.

39. Counsel then referred to evidence given by Mr. Boucher that he saw no connection between the two products. At one point Mr. Boucher said, "I did not connect the two products at that point in time. I honestly did not connect the two products." Later he said, "In my opinion because of the two different price points of the products I saw them and treated them as two different and separate products."

40. Counsel also relied on the evidence given by the witnesses that they did not have any intention of taking advantage of the coincidence in get up or of Telmak's advertising campaign. As the analysis of his Honour's judgment shows, his Honour did not accept evidence that the two had no intention of taking advantage of the television advertisements advertising the Telmak product.

41. In counsel's submission the evidence of Mr. Stapleton and Mr. Boucher revealed a consciousness of guilt and a desire to "cover up". Counsel said that the proper inference was that they were well aware at the time the Coles product came on the market that it was deceptively similar in name and get up and decided to exploit that similarity for Coles' competitive advantage. Counsel submitted that once an intention to mislead or deceive was found, the proper inference, bearing in mind Coles' retailing expertise, was that its conduct did actually mislead or was likely to mislead.

42. Counsel's submissions do not so much challenge factual findings made by his Honour as complain that his findings did not go far enough. His Honour was plainly unimpressed by the two witnesses' evidence and there is, of course, ample justification for his views in this regard. No submission to the contrary was made by counsel for Coles. In one of the passages earlier quoted from his Honour's judgment, his Honour found that Mr. Stapleton did examine the packaging for the purpose of making a comparison between the product and description found on the packaging and the product he had ordered the previous month in Taiwan with a view to reaching the conclusion that Coles was not interested in purchasing the Telmak pan. The packaging, although subpoenaed, was not produced and no explanation for its non-production was given. A similar finding was made in relation to Mr. Boucher's evidence. His Honour said that Mr. Boucher had in mind the draft packaging given him in October 1987 by Telmak and the language on that packaging. Mr. Boucher had sworn that the words did not "register at the time". These findings and the absence from the evidence of the packaging leave one with a sense of substantial anxiety about the question whether there was not all along an awareness by the two Coles employees of the close similarity of the descriptive words used on each box. To put it another way, it seems to me that there is substantial force in the proposition that, contrary to their evidence, Mr. Stapleton and Mr. Boucher knew all along that the Coles' product would arrive from Taiwan described in precisely the same way as the Telmak product and that this was a matter which they perceived as having some advantage to Coles.

43. His Honour has not made that finding, but I think it is a finding which it is open to us to make and I think it should be made. The question is what follows from that conclusion. It is here that one has to understand clearly the relevance or significance of the rule which Dixon and McTiernan JJ. explained in the Australian Woollen Mills case. The rule is not relevant to the question of goodwill or reputation or to distinctiveness. It is relevant to the question whether the applicant for relief has established a misrepresentation. Evidence of deliberate intent will assist an applicant in a borderline case in which the Court might otherwise have decided to refuse relief - the Office Cleaning Services case earlier referred to provides an example in the sense that the result in that case may have been different if the defendant's conduct had not been innocent. But it will not assist an applicant to establish goodwill or reputation. Either the applicant's own evidence on this question will establish that it has a reputation in relation to words used by it or its get up or it will not. If its evidence does not establish reputation, no amount of dishonesty on the part of a respondent will take the applicant's case over the line.

44. In Erven Warnink Besloten Vennootschap v. J. Townend & Sons (Hull) Limited (1979) AC 731 Lord Diplock recapitulated (p 742) the elements of the cause of action for passing off. There were five in all. They included (a) proof of a misrepresentation (b) which was calculated to injure the business or goodwill of another trader, and (c) which caused actual damage to the business or goodwill of the trader by whom the action was brought. The problem which I have with Telmak's case is that the evidence does not establish the making of a misrepresentation which has caused damage to its goodwill. That is because the matters upon which it relies to establish its goodwill are insufficient to achieve that end. I think the considerations are the same in relation to the cause of action based on a breach of s. 52 of the Trade Practices Act. Here, for the reasons earlier given, there is insufficient evidence to establish Telmak's reputation in relation to the words in question, that is, the Telmak words or in any get up used in relation to them. None of the evidence concerning the behaviour of the two Coles' executives affects the fact that the words and get up used were not sufficiently distinctive of the Telmak product to give it the necessary goodwill or reputation in them.

45. In the result I am of opinion that his Honour's conclusions were correct and that the appeal should be dismissed with costs.

This is an appeal from a decision of a Judge of this Court dismissing with costs an application made by the appellant, Telmak Teleproducts (Australia) Pty Limited, in connection with the distribution by the respondent, Coles Myer Limited, of a product described as "dry-fry convection oven pan with lid". The relevant facts lie within a small compass. Whatever the proper legal result of the case, those facts reflect little credit upon the respondent, Australia's largest retailer.

2. It appears that, in about 1978, one Albert C Schawalder, a Swiss, patented a frying pan which was designed to cook foods by heat transferred by convection, thus enabling the use of minimal quantities of cooking oil. The pan was to have a non-stick surface. Over subsequent years the pan was marketed in Australia by a number of organisations, at varying prices and using a number of descriptions, such as "dry oven pan", "slimmers' fry pan", "lo-cal fryer", "new dry pan" and "dry-fry convection pan".

3. Telmak is a marketing company which relies substantially upon television advertising for its sales. Early in 1986 Telmak commenced to market a version of Mr Schawalder's pan under the description "dry fry convection oven pan with lid". The pan was made of non-stick aluminium. Between that date and June 1988 the pan was advertised some 2000 times on Australian television. Each advertisement used that description on at least one occasion and included a photograph of the box in which the pan was packaged. That box contained in large letters the same description. Some of the advertisements invited viewers to telephone a particular number to arrange delivery of a pan, on a cash on delivery basis. Other advertisements ended with a "tag" announcing the name of a particular retailer from which pans could be purchased. In all, some 115,000 pans were sold by Telmak or its licensees, to June 1988, at a price of $39.95.

4. In September 1987 Mr J E Stapleton, Controller of Kitchenware and Plasticware for all K-Mart, Super K-Mart and Coles' stores operated by Coles Myer Limited, visited Taiwan for the purpose of purchasing a range of goods for retailing by those stores. Amongst other items he selected a version of Mr Schawalder's pan, which was made of steel, with a non-stick enamel finish, and which was described to him as "a dry fry pan". Mr Stapleton ordered 3,600 pans to be shipped on 2 March 1988. The pans were to be sent directly to several cities in Australia, including Fremantle. Mr Stapleton decided to include the pan in the K-Mart catalogue for the week commencing 30 May 1988, to retail at a price of $14.96.

5. In October 1987 Mr Donald Recsei, General Manager of Telmak, approached Mr C R Boucher, the Kitchenware Buyer for the K-Mart stores, with an offer for the sale of Telmak pans to Coles Myer's Western Australian stores. The offer included the proposal that Telmak would run a series of television advertisements for the pans, "tagging" specified Coles Myer stores. At that time a sample of the packaging of the pan was produced to Mr Boucher. Mr Boucher discussed the offer with Mr Stapleton, to whom he showed the packaging. Upon the instructions of Mr Stapleton, Mr Boucher rejected the offer. The trial judge found that, at the time of this approach, Mr Stapleton examined the Telmak packaging "for the purpose of making a comparison between the product and description found on the packaging and the product he had ordered the previous month in Taiwan, all with a view to reaching the decision which he communicated to Mr Boucher for transmission to Mr Recsei that Coles Myer was not interested in purchasing the Telmak dry fry pan".

6. In December 1987 or January 1988 the Taiwanese agent of Coles Myer sent to the company a sample of the art work proposed for the boxes in which the individual pans were to be packaged. The sample art work was not put into evidence. However, it seems that the dimensions of the proposed boxes were similar to those of the boxes used for the Telmak product. At least in its approved form, the art work included the description "dry-fry convection oven pan with lid"; although, by an ominous mischance, the word "pan" appeared as "pain". These words were printed in a size and style similar, although not identical, to that used for the printing of the same words on the Telmak boxes. Other wording on the package differed from that on the Telmak package. That wording did not include any identification of the manufacturer or distributor of the product.

7. The art work was approved by Mr Boucher, and, in due course, the order was delivered in boxes "got up" accordingly. The trial judge found -- and this finding is not challenged in the appeal -- that, in its choice of "get up" for the pan marketed by it, Coles Myer either adopted the description applied by Telmak to its pan or acquiesced in the decision of its Taiwanese agent to adopt that description. His Honour made no finding regarding the lettering of the description; but, given the similarities between the lettering used by the respective parties and the conceded knowledge of both Mr Stapleton and Mr Boucher of the Telmak "get up" at the time of the approval of the art work, a similar conclusion in relation to the lettering seems to be irresistible.

8. In March 1988 Mr Recsei made another approach to Coles Myer. On this occasion the proposal was not for an outright sale of a quantity of the pans, but rather that Coles Myer would take some pans on a "sale or return" basis. Mr Boucher accepted 750 units, for delivery to the Perth depot of the company during the week commencing 16 May 1988. Once again, it was part of the proposal that Telmak would undertake a television advertising campaign in respect of the pans, "tagging" relevant Coles Myer stores, at the time when the goods went on sale. At the time when Mr Boucher accepted Mr Recsei's offer, the trial judge found, he knew that his company would be selling an almost identical competing product at a much lower price. Mr Boucher knew that these two products would be on sale at about the same time and that Telmak proposed to promote its product extensively. Mr Boucher was aware that Telmak's television advertising would commence on 30 May 1988 and that the Coles Myer pans would go on sale on 29 May. The trial judge found that, in placing the order for the Telmak product, Mr Boucher had in mind "the advantages of the television promotion in attracting potential purchasers of dry fry pans into Coles Myer stores where there was also to be available a dry fry pan at a much cheaper price than that for the Telmak product".

9. There was a minor delay in the delivery of the 750 Telmak pans. They were not received into the Perth depot of Coles Myer until about the end of May. The pans went on sale in Coles Myer's Perth "K-Mart" and "Super K-Mart" stores at the same time as the pans purchased by Mr Stapleton in Taiwan; the latter pans being offered in the same department of the same stores but at a significantly lower price. Although the two types of pan were made of a different material, they were of identical appearance, except for colour.

10. On 1 June 1988 an executive of Telmak telephoned nine K-Mart stores, in the Sydney metropolitan area, asking on each occasion: "Do you have any of those dry fry pans which I have seen advertised on TV?". On each occasion an answer was given which connected the Coles Myer product with that referred to by the enquirer. The Coles Myer pan had not, in fact, ever been advertised on television.

11. On 3 June 1988 the present proceeding was commenced. Interlocutory relief was sought. The interlocutory application was resolved by Coles Myer giving to the Court, without admissions, certain undertakings, including an undertaking not to distribute from its warehouses any more of the pans imported by it from Taiwan.

12. As the content of this undertaking suggests, at the time of the interlocutory application, Telmak claimed to be entitled to an order restraining Coles Myer from marketing its pan. No such claim was made at the trial. Rather, Telmak complained of the use of the words "dry-fry oven pan with lid" and the "get up" on the packages used by Coles Myer. Telmak said that, by reason of these matters, Coles Myer had contravened s.52 of the Trade Practices Act 1974 and had passed off its goods as those of Telmak.

13. The major issue at the trial was whether the words "dry-fry convection oven pan with lid", which was conceded by Telmak to be a series of ordinary English words accurately describing the item marketed by Coles Myer, had acquired a meaning distinctive of Telmak's product; so that the use of this description, without qualification, would suggest to the reader that the pan being offered for sale by Coles Myer was that distributed by Telmak. His Honour heard evidence from several people involved in the distribution of the Telmak pan and he noted that, without exception, those people referred to the product by a more compendious description, such as "dry-fry pan", "dry-fry oven pan" or "Telmak dry-fry pan". In the result, the trial Judge found that no secondary meaning attached to those words so that, in using that description, Coles Myer made no representation that the product offered by it was that of Telmak.

14. Counsel for the appellant argue that his Honour erred in rejecting the case made by their client in connection with the description. They point to the finding that Coles Myer knowingly adopted, or acquiesced in the adoption of, the same description as that used by Telmak. They contend that, under such circumstances, the only available inference is that Coles Myer intended to cause members of the public to believe that its product was the same product as that which had been advertised on television, namely the Telmak product. Reference is made to the speech of Lord Simonds in Office Cleaning Services Limited v Westminster Window and General Cleaners Limited (1946) 63 RPC 39 at pp 42-43. That case concerned names; the plaintiff having always used the name "Office Cleaning Services" and the defendant having recently adopted the style "Office Cleaning Association". The words of Lord Simonds are well known, but as they bear on both aspects of the present case they are worth repeating:

"The real question is the simple and familiar

one. Have the Appellants proved that the use

by the Respondents of the trading style

'Office Cleaning Association' is calculated to

lead to the belief that their business is the

business of the Appellants? It is in these

words 'calculated to lead to the belief' that

the issue lies. It is a calculation often

difficult to make, as the different estimates

in the Court below in this case indicate. The

nature of the words which are used in the

trade name, the circumstances and

peculiarities of the trade, the motives,

proved or presumed, of the trader who would

use the words, all these and many other

factors must be considered by the judge in

determining whether a Plaintiff can succeed in

his claim. It is a question upon which the

judge who has to decide the case has to bring

his own mind to bear and which he has to

decide for himself . . . But instances of

actual deception will be given their due

weight.

In the present case there are certain

considerations to which I think it worth while

to call particular attention.

Foremost I put the fact that the Appellants

chose to adopt as part of their title the

words 'Office Cleaning' which are English

words in common use, apt and more apt than any

other words to describe the service that they

render. This is a trade name, not a trade

mark, case, but I would remind your Lordships

of the close analogy between the two classes

of case . . . So it is that, just as in the

case of a trade mark the use of descriptive

words is jealously safeguarded, so in the case

of trade names the Courts will not readily

assume that the use by a trader as part of his

trade name of descriptive words already used

by another trader as part of his trade name is

likely to cause confusion and will easily

accept small differences as adequate to avoid

it. It is otherwise where a fancy word has

been chosen as part of the name. Then it is

that fancy word which is discriminatory and

upon which the attention is fixed, and if

another trader takes that word as part of his

trade name with only a slight variation or

addition, he may well be said to invite

confusion. For why else did he adopt it?

Secondly I observe that here there is in the

Respondents' choice of name no improper or

sinister motive. The learned judge found that

they did not intend to cause confusion between

their business and that of the Appellants by

dropping the word 'Westminster'. This is not

a matter of conclusive importance. Confusion

innocently caused will yet be restrained. But

if the intention to deceive is found, it will

be readily inferred that deception will

result. Who knows better than the trader the

mysteries of his trade? For myself I find the

Respondents' explanation of their action

satisfactory. They were, I think, justified

in the fear that some potential customers

might think they did not operate outside the

Westminster area and for that reason refrain

from employing them. And it is just this sort

of consideration which makes it undesirable

that a first user of descriptive words should

be entitled to demand that a second user

should differentiate by any form of limiting

words. To speak of a monopoly is inaccurate,

but anything that looks like a monopoly is

suspect.

Thirdly, your Lordships will note that the

Appellants do not claim that the words 'Office

Cleaning' have acquired a secondary meaning,

by which I understand them to mean that they

do not claim that these words mean a service

of cleaning offices as rendered by them and

them alone. Such a claim would indeed be

impossible to maintain. But, while making

this disclaimer, they nevertheless contend

that as a trade name 'office cleaning' is so

much identified with their business that any

trader who ventures to use these words as part

of his trade name must clearly differentiate.

This seems to me to be no more than a

restatement of the familiar problem. The

Court will undoubtedly take into consideration

long user of a descriptive name but will not

forget that, since it is descriptive, small

differences may suffice."

15. As this passage brings out, there is an important difference, in passing off law, between the use by a trader of descriptive words already used by a rival trader and the use of a "fancy" name concocted by the latter. The distinction is not one of underlying principle. In each case, in order to succeed, the plaintiff must show that the defendant has misrepresented its business or goods as being that of the plaintiff. In either case, there may be a passing off; in either case, it may be determined, as a conclusion of fact, that there has been no misrepresentation. The difference is an evidentiary one.

16. As Lord Simonds remarked, the courts will jealously guard the entitlement of people to use ordinary English words to describe their businesses and their goods. To give to the first comer, in effect, a monopoly of the use of ordinary English words may be to preclude others from using the words which most aptly describe their own businesses or goods; a result which is scarcely conducive to the public interest. Accordingly, protection will not be granted against the use by another of descriptive words unless the person claiming protection is able to establish that those words have acquired, amongst members of the public, a secondary meaning distinctive of that person's business or goods. In the relatively rare cases in which this can be shown, the courts will restrain the use by another of the words, whether or not that use results from an intentional copying. The reason is that otherwise the public would be likely to be misled into thinking that the subject business or goods was that of the plaintiff.

17. In the case of ordinary English words, proof of deliberate copying affords some evidence that people might be misled by the words. However, that proof is less significant than in the case of a "fancy" word; ex hypothesi, the words are ordinary words descriptive of the defendant's business or product and which it would be natural for it to use without having any sinister intent. And because the words are descriptive of the defendant's business or goods, even a small difference will be accepted as adequate to avoid confusion.

18. In the case of a "fancy" name, a plaintiff's case still depends upon the proposition that the name is distinctive of its own business or product, so that use of that name is likely to occasion confusion. But it is much easier for the plaintiff to establish those two elements. As the name is one which was invented to describe the plaintiff's business or goods it is, by definition, distinctive. The question whether the use by another trader of that same name will cause confusion must always be a question of fact; but if the plaintiff is able to show that it has used the name to describe its business or goods, distinctiveness will readily be inferred. And if it appears that a rival trader has deliberately copied the name, the natural inference is that this course was thought to be commercially advantageous. The most obvious form of commercial advantage would be that potential customers would be induced by the name to believe that the copier's business or product was, or was associated with, that of the original trader. The innocent explanation, a desire to use ordinary words descriptive of the copier's business or goods, is unavailable in the case of a "fancy" name.

19. What we have said about fancy names applies equally to "get up", that is a design of the product or its packaging which reflects marketing, rather than functional, imperatives. "Get up" is artificial, devised for a particular business or product. Members of the public will readily see "get up" as distinctive of a particular trader's business or goods. Where "get up" is copied, it is natural to infer an intent by the copier to mislead members of the public as to the identity or provenance of the business or goods; and, as the judgment that this ploy is likely to be successful is made by someone within the trade, the courts will be slow to assume that the judgment is wrong.

20. Counsel for Telmak contend that his Honour should have found that the description "dry-fry convection oven pan with lid" has become distinctively associated with their client's business. Alternatively, they say that the proper inference is that, in adopting exactly that same description, the officers of Coles Myer intended to deceive members of the public into the belief that their pan was that of Telmak; and that, if this be so, it is unnecessary for Telmak to show the existence of a distinctive association.

21. As to the first, it is true that Telmak used the description "dry-fry convection oven pan with lid". But there is no evidence that either members of the public or people in the trade distinctively associated these words with Telmak's product. On the contrary, each reference to the pan disclosed by the evidence, other than upon the packaging itself, was by an abbreviated name which omitted both the words "convection" and "oven" and any reference to the lid.

22. As to the second submission, Office Cleaning does not support the proposition that proof of deliberate copying necessarily establishes a passing off. Proof of copying, indicating an intention to deceive, is of powerful evidentiary value. As Lord Simonds rhetorically asked: "Who knows better than the trader the mysteries of his trade?". But such evidence is not necessarily decisive. The question remains whether, upon the whole of the evidence, the plaintiff has established a misrepresentation. In Cadbury-Schweppes Pty Limited v Pub Squash Co Pty Limited (1981) 1 WLR 193 at p 203 the Judicial Committee of the Privy Council approved a comment by the trial judge in that case that:

". . . the court must be on its guard against

finding fraud merely because there has been an

imitation of another's goods . . ."

See also the passage in the advice at p 200 wherein the Judicial Committee adopted, and applied to other descriptive material, the comment made by Stephan J, in Hornsby Building Information Centre Pty Limited v Sydney Building Information Centre Pty Limited [1978] HCA 11; (1978) 140 CLR 216 at p 229, wherein his Honour pointed out that the "its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public". In Cadbury-Schweppes, the Judicial Committee, at p 200, referred to the modern action for passing off, as being:

". . . wide enough to encompass other descriptive

material, such as slogans or visual images,

which radio, television or newspaper

advertising campaigns can lead the market to

associate with the plaintiff's product,

provided always that such descriptive material

has become part of the goodwill of the

product. And the test is whether the product

has derived from the advertising a distinctive

character which the market recognises."

"But competition must remain free: and

competition is safeguarded by the necessity

for a plaintiff to prove that he has built up

an 'intangible property right' in the

advertised descriptions of his product: or,

in other words, that he has succeeded by such

methods in giving his product a distinctive

character accepted by the market."

See also B M Auto Sales Pty Limited v Budget Rent A Car System Pty Limited (1977) 51 ALJR 254 at pp 257-258 wherein Gibbs J listed, as cumulative requirements, two elements: first, that particular descriptive words are distinctive of the plaintiff's business and, secondly, "that the use of the name by the defendant is likely to deceive people into supposing that the business conducted by the defendant is that of the plaintiff".

23. It is not necessary to determine what view we might have taken if the only evidence had been of the deliberate copying of the descriptive words used by the appellant and if there had been no evidence of the manner in which Telmak's product was described in everyday parlance. Perhaps, under those circumstances, it might have been proper to draw the inference referred to by Lord Simonds and to conclude that Coles Myer had succeeded in appropriating the description commonly applied to Telmak's product. However, in the face of the evidence that this description was not usually applied to the Telmak product, this conclusion cannot be reached. The adoption by Coles Myer of the Telmak description is not enough to entitle Telmak to relief.

24. It does not follow that the appeal should be dismissed. The matter of "get up" remains. Telmak has always asserted that, even if Coles Myer is entitled to market the pan and to do so under the name "dry-fry convection oven pan with lid", it is not entitled to do so in packaging which imitates its own: see para.8 of the Statement of Claim. We are assured by counsel that this point was pressed at the trial. Notwithstanding that fact, his Honour did not deal with "get up" in his reasons for judgment; perhaps because the matter of "get up" -- representing, as it did, a position of last resort for Telmak -- received much less attention at the trial than the issue as to the distinctiveness of the name. Nonetheless, the issue must be considered by us.

25. In relation to that question two preliminary comments are appropriate. The first is that, in this context, the distinction previously made between ordinary English names and fancy names -- or get up -- becomes important. Here, the Court is not merely looking at a series of ordinary English words descriptive of a product which, prima facie, are available for use by all. The Court is looking at a particular lay-out of those words in a form created by or on behalf of Telmak and applied to the promotion of its product. Having regard to the number of sales made by Telmak, of pans packaged in boxes so printed, and to the extensive advertising of those pans in those boxes, it is reasonable to treat that lay-out as part of Telmak's product goodwill. On this ground Telmak is not liable to be met with the answer that it cannot be allowed to appropriate for itself ordinary English words. On this aspect of the case, it does not seek to do so; it simply asserts a right to restrain others from using those words in a lay-out which it has devised and extensively used.

26. Secondly, no distinction need be made between the applicant's s.52 claim and its passing off claim. Section 52 of the Trade Practices Act is concerned with misleading or deceptive conduct by a corporation, in trade or commerce. Typically, although not necessarily, that conduct will take the form of a misrepresentation; sometimes that misrepresentation may concern the provenance of goods offered for sale by the misrepresenter. The law of passing off is concerned with representations made by a trader by which the trader suggests, expressly or by implication, that goods offered by him for sale are the goods produced or offered for sale by another person or that they are the same as other goods, the source of the latter goods being unidentified: see Erven Warnink BV v J Townend & Sons (Hill) Ltd (1979) AC 731 It is obvious that, in some fact situations, the inquiry will be the same, whether the case is considered under s.52 or under the law of passing off: did the respondent represent that the goods offered by it were goods produced, or offered, by the applicant or were the same as other goods, being the applicant's goods? This is such a case. As it seems to us, both the s.52 claim and the passing off claim stand or fall according to the manner in which that question is answered.

27. Once it be accepted that Coles Myer was entitled to offer its pan for sale, and to use the marketing description "dry-fry convection oven pan with lid", the question posed may only be answered favourably to Telmak if it may be said that the "get up" used by Coles Myer, in connection with the sale of that pan under that description, was such as to be likely to cause a significant proportion of potential purchasers to believe that the Coles Myer pan was that offered for sale by Telmak or that it was the pan offered for sale on television. In connection with the latter test, it is not necessary for Telmak to persuade the Court that persons who saw the pan on display at a Coles Myer store, and who had seen the television advertisement, would remember the name "Telmak". It would be enough that they would be likely to associate the pan with the television advertisement: see T Oertli AG v E J Bowman (London) Ltd (1959) RPC 1 at p 4 wherein Viscount Simonds said:

"It is a condition precedent to the success of

such an action", (that is, a passing off

action) "where the alleged representation

consists of the use of a name in connection

with the goods, that that name should have

become distinctive of the Plaintiff's goods,

not necessarily meaning thereby that his name

should be known . . ., but at least meaning that

they should be regarded as coming from a

particular source known or unknown."

This principle was, of course, that underlying the decision in Warninck and in the champagne, sherry and Scotch whisky cases which were there approved.

28. A decision by a court upon the question whether, by reason of the "get up" of a product or of its packaging, the product of one party would be likely to be taken to be the product of another is a decision upon an ultimate question of fact, to be made in the light of all of the evidence. In some cases the answer is obvious; the "get up" is so strikingly similar or dissimilar as to admit of little doubt. In other cases the question may be a borderline one, requiring the application of what is ultimately an impressionistic judgment predicated upon the judge's understanding of how persons contemplating that purchase are likely to behave. It is a question upon which minds may and, as the reported cases show, do differ.

29. There are three significant similarities between the packaging used by Telmak and that used by Coles Myer: the size and shape of the boxes, the words used by way of description and the size and layout of the lettering conveying that description. As to the first similarity, there is no evidence to suggest that Coles Myer deliberately adopted a package of the same size and shape as that used by Telmak. It may have done so, but, by reason of the shape and size of the pan itself, it is likely that, in any event, Coles Myer would have chosen a package of about this size and shape. Each package was of a size and shape appropriate to the efficient packaging of the product.

30. Accordingly, there is nothing sinister or significant in the fact that Coles Myer adopted the package which it did; and, as already stated, it was entitled to use the descriptive words "dry-fry oven pan with lid". Those factors do not entitle the applicant to relief. However, they must each be borne in mind in considering the third similarity, the size and layout of the lettering used, and which lettering was deliberately copied on behalf of Coles Myer. In considering the effect of that similarity, it has to be remembered that the copied lettering was applied to a package of the same size and shape as the Telmak package and for the reproduction of the same words.

31. Although there are similarities between the two packages there are also substantial dissimilarities, especially in the picture of the goods on each package and in the remainder of the wording. There is a difference in the colour tonings which have been used. These dissimilarities provide support for the conclusion that potential purchasers would be unlikely to mistake the product offered by Coles Myer for that which they had seen on television, notwithstanding the prominence on the respective packages of the words "dry-fry convection oven pan with lid". Of course, in evaluating that matter, it is necessary to remember that the Telmak television advertisements provide only a fleeting glimpse of the package, so that viewers might remember only similar aspects of the package and not recall dissimilar features. In that regard, the description of the product is both intrinsically important and a prominent feature of the package as displayed in the television advertisements.

32. The matters just mentioned are finely balanced. If they stood alone, we would have hesitated to conclude that the similarity of the lettering would have been likely to mislead potential purchasers. But it is proper to take into account not only Coles Myer's deliberate choice to copy the description used by Telmak, and the style of lettering in which that description was conveyed, but also that, throughout the litigation, the company has insisted in maintaining its entitlement to continue to use that lettering. It is not difficult to understand the concern of Coles Myer, as a major retailer, to assert its entitlement to market goods under a description constituted by ordinary English words which have not become distinctive of some other trader's goods. It is less easy to understand why Coles Myer should seek to insist upon a right to use a particular style of lettering for such words, unless its relevant officers thought that this gave to it some marketing advantage. Yet, even before us and after "get up" had been extensively argued, Coles Myer, through its counsel, took that course.

33. As I have already observed, proof of the fact that a trader has deliberately copied the name or "get up" of a rival does not itself establish a contravention of s.52 or a passing off of goods. The proof has evidentiary value only. But the evidentiary value is significant. The courts have long recognised that traders best know their trade. In Australian Woollen Mills Limited v F S Walton and Company Limited [1937] HCA 51; (1937) 58 CLR 641 at p 657 Dixon and McTiernan JJ treated proof of copying as yielding a presumption:

"The rule that if a mark or get-up for goods is

adopted for the purpose of appropriating part

of the trade or reputation of a rival, it

should be presumed to be fitted for the

purpose and therefore likely to deceive or

confuse, no doubt, is as just in principle as

it is wholesome in tendency."

See also the passage from Office Cleaning quoted above.

34. In the present case, the evidence established that a deliberate decision was made by two senior marketing executives of Coles Myer to adopt both the descriptive words used by Telmak on its packaging and the style and layout of lettering in which that description was proclaimed. Their employer, Coles Myer, has endeavoured to maintain that position throughout this litigation. From those circumstances, we think that the inference should be drawn that, in the judgment of those two executives, and presumably others in their organisation, the retention of these words, and this lettering, on its packaging would be likely to assist sales of the Coles Myer product. It could do so only if it caused persons who saw the Coles Myer package to relate that package to the product advertised on television by Telmak. Any hesitation on our part must yield to those judgments, made as they are by people of considerable marketing experience on behalf of a company enjoying some 28% of total Australian retail turnover.

35. In the result, as we see the case, Telmak is entitled to relief, but on a more limited basis than was sought. We would allow the appeal and set aside the order of the trial Judge dismissing the application. An injunction should be granted restraining Coles Myer, by its servants or agents, from selling or offering for sale any dry-fry pan with lid in packaging upon which the words "dry-fry convection oven pan with lid" are set out in lettering substantially similar to the lettering for those words used by Telmak on its package, exhibit C. An order should be made for an account of the profits derived by Coles Myer from its sales of such dry-fry pans in packages similar to exhibit D, and the matter should be remitted to the learned trial Judge for the taking of that account. Coles Myer should pay the costs of Telmak, both in this Court and at first instance.