Principles
51 The relevant date for determining whether a plaintiff has established the necessary goodwill or reputation of his product is the date of commencement of the conduct complained of: Cadbury Schweppes Pty Limited v Pub Squash Co Pty Limited [1980] 2 NSWLR 851 at 861 per Lord Scarman.
52 In these proceedings SunRice seeks only equitable relief in respect of the claim for passing off; it has abandoned any claim for damages and seeks only an account and injunctive relief. Thus, the proceedings for passing off seek a remedy to protect against injury to the goodwill built up by the activities of SunRice: Campomar Sociedad, Limitada v Nike International Limited (2000) 202 CLR 45 at 88 [108] per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ. And, as their Honours pointed out, the action based on a contravention of s 52 is designed to protect consumers. Whether or not conduct amounts to a representation is a question of fact to be decided by considering what was said, written, and done against the background of all surrounding circumstances: see Campomar 202 CLR at 84 [100], citing Taco Co of Australian Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 at 202 per Deane and Fitzgerald JJ.
53 In this area of the law the courts constantly endeavour to keep pace with the progress of trade by adapting fundamental doctrines to advancing methods and changing circumstances: Angelides v James Stedman Hendersons Sweets Ltd (1927) 40 CLR 43 at 59-60 per Isaacs ACJ; ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302 at 356 per Gummow J; Campomar 202 CLR at 88 [109].
54 The tort of passing off is no longer anchored to the name or trademark of a product or business. As Lord Scarman pointed out in Cadbury Schweppes [1980] 2 NSWLR at 858 [22]:
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.
55 Their Lordships went on, through Lord Scarman, to say that competition had to remain free and was safeguarded by the necessity for the plaintiff to prove that he has built up an intangible property right which he seeks to protect in the action: Cadbury Schweppes [1980] 2 NSWLR at 858 [23]: see too Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 445 per Deane J (with whom Gibbs CJ, Mason, Wilson and Dawson JJ agreed). In ConAgra 33 FCR at 356 Gummow J said:
But it is to be observed that the law of passing off contains sufficient nooks and crannies to make it difficult to formulate any satisfactory definition in short form. However, "the classical trinity" does serve to emphasise three core concepts in this area of the law. This appeal is concerned with all of them, namely, the geographical requirements for a sufficient reputation, the nature of the interest damaged, and the significance of fraud in the making of the misrepresentation.
56 For over 150 years it has been the law that "nobody has any right to represent his goods as the goods of somebody else" per Turner LJ in Burgess v Burgess (1853) 22 LJ Ch 675; 3 De GM&G 896 at 904; [43] ER 351 at 354: AG Spalding & Bros v AW Gamage Ltd (1915) 84 LJ Ch 449 per Lord Parker of Waddington (with whom Viscount Haldane LC, Lord Atkinson and Lord Sumner concurred): Angelides 40 CLR at 81 per Rich and Starke JJ.
57 Lord Parker identified the basis of a passing off action as a false representation by the defendant that his goods were the plaintiff's. In Campomar 202 CLR at 88-89 at [109]-[110] the High Court recognised that the range of the defendant's conduct which could constitute passing off included inducing consumers to believe that the defendant's goods or services had an association, quality or endorsement which belonged, or would belong, to the goods or services of or associated with the plaintiff. As Lord Parker recognised, relevantly here, the point to be decided is whether, having regard to all the circumstances of the case, the use by the defendant in connection with the goods of the get-up in question, impliedly represents the defendant's goods to be goods of the plaintiff or associated with the plaintiff, whether generally or in respect of a particular class or quality. In other words, the question is whether the defendant's use of the get-up is calculated to deceive. He pointed out that it would be impossible to enumerate or classify all the possible ways in which a man may make the false representation relied on: Spalding 84 LJ Ch at 450; see too Vieright Pty Ltd v Myer Stores Ltd (1995) 31 IPR 361 at 369-370 per Beaumont, Branson and Lindgren JJ; ConAgra 33 FCR at 356 per Gummow J.
58 But, what is protected is a proprietary interest of the plaintiff in his goods or get-up; that is, for the purposes of equitable relief, the goodwill which the plaintiff has built up which the defendant's false representation injures. Mere use of the get-up of another in the selling of goods is not enough. The representation which must be conveyed by the use is that the other's goods or goods associated with him are being sold by the defendant: see Collitt v Borsalino Guiseppe e Fratello SA (1913) 16 CLR 344 at 351 per Barton ACJ, Isaacs, Powers and Rich JJ.
59 It is not necessary that the persons purchasing the goods should know of the manufacturer by name, and have in mind when they purchased the goods that they are made by that person (or the person they associate with having produced those goods, whether or not the name is known): Collitt 16 CLR at 351. Where a plaintiff's name or get-up acquires a secondary meaning, the defendant's use of the name or get-up conveys the misrepresentation that the goods are the plaintiff's. It is in this way that the plaintiff's goodwill will be injured: Collitt 16 CLR at 359, 361.
60 A trader has a prima facie right to put his goods in any packages which he may think attractive and convenient and in any method which he may consider suitable for carrying on his trade provided that the form adopted is not likely to deceive the ordinary reasonable consumer into mistaking his goods for the goods known in the market as manufactured, put up or sold by another: Burford & Sons Ltd v Mowling & Son (1908) 8 CLR 212 at 216 per O'Connor J; affirmed at 8 CLR 222-224 per Griffith CJ, Isaacs and Higgins JJ. O'Connor J said that there the plaintiffs had no monopoly in the particular kind of packing which they adopted, which was used in a large number of articles. Those included not only packed soap, but grocery items and a variety of other items. He also said that the plaintiffs could not acquire a monopoly of the form of package by adopting a particular form of packaging, because its use was open to anyone in the trade. But his Honour went on to say that:
… where, as in this case, a certain method of get up, though open to all traders, has been for many years solely identified with the plaintiffs' goods in a particular market, it is incumbent on a trader who adopts the same method of get up for the purpose of pushing his trade and a similar article in the same market, that he shall clearly differentiate his goods on the face of the package from those of the plaintiffs. (Burford & Sons 8 CLR at 217)
61 O'Connor J found that the question for determination was whether the defendant had made the difference of manufacture and ownership clear on the face of the package when adopting cartons of the same material, colour, shape and size of the plaintiff's packaging. He applied what Lindley MR said in Payton & Co Ltd v Snelling Lampard & Co Ltd (1899) 17 RPC 48 at 52. Lindley MR discussed the situation where goods themselves resembled one another, in that case coffee, and were packaged similarly. He said that the issue was not that the defendant's goods or get-up was like the plaintiff's by reason of the features common to them and others. Rather, in a passage cited with approval by O'Connor J in Burford & Sons 8 CLR at 217, in order to succeed in a passing off action, the plaintiff:
…must make out that the defendant's are like his by reason of something peculiar to him, and by reason of the defendant having adopted some mark, or device, or label, or something of that kind, which distinguishes the plaintiff's from other goods which have, like his, the features common to the trade. Unless the plaintiff can bring his case up to that, he fails.
62 Much later the House of Lords held that a plaintiff who sold lemon juice in a container resembling a natural lemon with a green triangular label bearing the word "Jif" was entitled in an action for passing off to protect the get-up and packaging of the lemon shape because over the years a secondary meaning had been created associating the plaintiff's get-up with goods manufactured by it: Reckitt & Colman Products Ltd v Borden Inc [1990] 1 WLR 491 at 506F-G per Lord Oliver of Aylmerton who said:
Here the mere fact that he has previously been the only trader dealing in goods of that type and so described may lead members of the public to believe that all such goods must emanate from him simply because they know of no other. To succeed in such a case he must demonstrate more than simply the sole use of the descriptive term. He must demonstrate that it has become so closely associated with his goods as to acquire the secondary meaning not simply of goods of that description but specifically of goods of which he and he alone is the source.
63 Thus, the mere fact that a defendant makes some distinction on the packaging from similar packaging used by or copied from the plaintiff may or may not be sufficient to distinguish the goods from those of or associated with the plaintiff: Burford & Sons 8 CLR 212; Payton 17 RPC at 56; affirmed [1901] AC 308; Borden [1990] 1 WLR at 507H-508B per Lord Oliver. Lord Oliver said that it was important in such a case for the defendant to see that the goods could really be distinguished from those of or associated with the plaintiff. But, he said the question was how far the defendants' trademark bears such a resemblance to that of the plaintiff, as to be calculated to deceive incautious purchasers: Borden [1990] 1 WLR at 509B citing Lord Kingsdown in Leather Cloth Co Ltd v American Leather Cloth Co Ltd (1865) 11 H L Cas 523 at 539.
64 In Borden [1990] 1 WLR at 514H-515C Lord Jauncey of Tullichettle said that a trader could only claim protection for such capricious additions to a commonly used container as distinguished his use of that container from the use of other traders. Thus, the trader may prevent a rival copying the label on boxes or perhaps the distinctive combination of colours on tins but cannot stop the rival using ordinary boxes or tins simply because they happen to be the same shape and size as his. He said that it was not the shape and size of the container which identified the product of a particular trader to the public, but the capricious additions to it by way of distinctive labelling or a combination of colour or graphic design. He referred to JB Williams Company v H Bronnley & Co Limited (1909) 26 RPC 765 at 771 per Cozens-Hardy MR and at 774 per Farwell LJ. In that case, at 773, Fletcher Moulton LJ had said there that the get-up of an article meant a capricious addition to the article itself, such as the colour or shape or wrapper or anything of that kind: see too Doctor Martens Australia Pty Ltd v Figgins Holdings Pty Ltd (1999) 44 IPR 281 at 369 [339] per Goldberg J; and Borden [1990] 1 WLR at 515C-D per Lord Jauncey.
65 Representations are never made in a factual vacuum. They occur in a context which the court must ascertain before it can come to a conclusion about what they conveyed to the representee. The context includes the way in which and where the representation was made as well as the state of mind of the representee. Where the representation is made to the public or a section of it, the court considers the position of an ordinary reasonable person of that class in order to assess the effect of the representation. That provides an objective standard based on the reaction of the hypothetical representee.
66 So, in a claim alleging that a contravention of s 52 of the Trade Practices Act has occurred, the court considers the effect on an ordinary reasonable shopper by conduct involving the making of a representation to the class of retail consumers shopping in a supermarket displaying a trader's packaged goods on its shelves: Campomar 202 CLR at 84-85 [101]-[103]. The court attributes particular characteristics to this shopper. In actions for passing off a similar test applies in assessing whether a representation was made and, if so, what its effect was. So, in Borden [1990] 1 WLR at 509C-D Lord Oliver said that this is done against the background of the type of market in which the goods are sold, the manner in which they are sold, and the habits and characteristics of purchasers in that market: see too Campomar 202 CLR at 84 [100].
67 And, as Burchett J noted in Kettle Chip Co Pty Ltd v Apand Pty Ltd (1993) 46 FCR 152 at 161:
Of course, a person who places the packets before him, side by side, can also see differences. But that is not how passing off by the imitation of another trader's mark or get-up is to be tested. In general, and more particularly in the case of an item likely to be purchased for a small price without long consideration, the comparison which must be made is between the impression of the applicant's goods retained in a customer's mind and the impression made by the sort of consideration he is likely to give to the respondent's product before purchasing it.
68 In the law of passing off, the courts have treated evidence of the intentions of the defendant as relevant to the question of whether a representation is conveyed. SunRice argued that this evidence was determinative. It relied on remarks of Dixon and McTiernan JJ in Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641 at 657. They said:
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. But the practical application of the principle may sometimes be attended with difficulty. (emphasis added)
69 However, their Honours concluded that in the end it was still a question of fact for the court to determine whether, indeed, there had been established a reasonable probability of deception or confusion from the use, in that case, of a trademark or device. They held that the main issue in the case was a question which was never susceptible of much discussion. They said (Australian Woollen Mills 58 CLR at 659; see too Burford & Sons 8 CLR at 220 per O'Connor J; Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 55 IPR 354 at 389 [121] per Weinberg and Dowsett JJ, Branson J agreeing; Office Cleaning Services Ltd v Westminster Window & General Cleaners Ltd (1946) 63 RPC 39 at 40 per Lord Simonds, with whom Lords Wright, Porter and Goddard agreed):
It depends on a combination of visual impression and judicial estimation of the effect likely to be produced in the course of the ordinary conduct of affairs.
70 In Payton [1901] AC at 311 Lord Macnaghten said that the evidence of witnesses as to whether a customer would be likely to be deceived was, not a matter for the witnesses, but for the judge. He said, in a passage approved by Dixon CJ, Webb, Kitto and Taylor JJ in Scott v Numurkah Corporation (1954) 91 CLR 300 at 313:
The judge, looking at the exhibits before him and also paying due attention to the evidence adduced, must not surrender his own independent judgment to any witness.
71 Mere proof of the fact that a person has deliberately copied the name or get-up of a trade rival does not of itself establish a contravention of s 52 or a passing off or goods or services: Apand Pty Ltd v The Kettle Chip Co Ltd (1994) 52 FCR 474 at 496 per Lockhart, Gummow and Lee JJ. In ConAgra 33 FCR at 374, Gummow J said "[d]eliberate copying does not necessarily indicate fraud. A notable example is provided by Cadbury Schweppes [[1980] 2 NSWLR 851]". And, Lockhart J said (ConAgra 33 FCR at 345: French J at 377 agreed with both Lockhart J and Gummow J):
But deliberate copying of the plaintiff's goods does not always evidence an intention to deceive; it may indicate nothing more than realisation that the plaintiff has a useful idea which the defendant can turn to his own advantage, though not intending to pass off his goods as those of the plaintiff.
72 In Cadbury Schweppes Pty Limited v Darrell Lea Chocolate Shops Pty Limited (2007) 159 FCR 397 at 418-419 [96]-[99] Black CJ, Emmett and Middleton JJ observed that the principles relating to passing off do not necessarily require a plaintiff to establish an exclusive reputation in relation to the use of a particular colour, in that case, purple. They said that the question was whether the plaintiff could establish facts that demonstrate that a particular use by the defendant of the colour was likely to mislead or deceive consumers into believing that there was relevant connection between the defendant and the plaintiff or their respective products: Darrell Lea 159 FCR at 418 [96]; see too Office Cleaning 63 RPC at 42 per Lord Simonds. They observed that both in the context of Pt V of the Trade Practices Act and the common law tort of passing off, trade indicia other than names and logos can become associated with a particular trader, so that use by another trader could give rise to misleading or deceptive conduct or passing off. They said (Darrell Lea 159 FCR at 418 [97]):
If particular branding elements used by a trader have been identified in a special way with that trader in the minds of the members of the public, there may be misleading or deceptive conduct by reason of the appropriation of those particular branding elements by another trader.
73 Black CJ, Emmett and Middleton JJ said, obiter, that whether or not there was a requirement for some exclusive reputation as an element in the common law tort of passing-off, Pt V of the Trade Practices Act did not include such a requirement. Under the Act, the question is whether the use of the particular get-up or name by an alleged wrongdoer in relation to his product is likely to mislead or deceive persons familiar with the claimant's product to believe that the two products are associated, having regard to the state of knowledge of consumers in Australia of the claimant's product: Darrell Lea 159 FCR at 419 [99].
74 But for passing off or a contravention of s 52 to occur the defendant must make a false representation that the defendant's goods are the plaintiff's or are associated in some way with the plaintiff. The focus of s 52 is on the misleading of others, rather than upon an injury to a competitor: Hornsby Building Information Centre Pty Limited v Sydney Building Information Centre Ltd (1978) 140 CLR 216 at 228 per Stephen J.
75 In cases of passing off where the wrongful appropriation of the reputation of the plaintiff or that of his goods is in question, a plaintiff who used descriptive words in his trade name would find out that quite small differences in a competitor's trade name would render the latter immune from action. The law recognises the possibility of blunders by members of the public when descriptive words are used by two traders as part of their respective trade names. But, Stephen J said the risk of confusion must be accepted because "… to do otherwise is to give to one who appropriates to himself descriptive words an unfair monopoly in those words and might even deter others from pursuing the occupation which the words describe": Hornsby Building Information Centre 140 CLR at 229. And, he said that similar principles applied to s 52, because allowing that section to be used as an instrument for the creation of a monopoly of descriptive names "… would be to mock the manifest intent of the legislation": 140 CLR at 230. The principle is not limited to a name but applies to other descriptive material if it has not given a distinctive character to a product or business: Cadbury Schweppes [1980] 2 NSWLR at 858 [21] per Lord Scarman. I am of opinion that a similar principle applies to the use of a get-up in which the plaintiff has no proprietary interest or goodwill i.e. where he has not created a secondary meaning associating the plaintiff or his goods with the get-up.
76 It is appropriate for the court to approach the question of whether s 52 has been contravened by answering the composite question whether the defendant's conduct was misleading or deceptive in relation to the ordinary and reasonable consumer of rice cakes or corn cakes purchasing them in supermarkets: see Knight v Beyond Properties Pty Limited (2007) 242 ALR 586 at 597 [51] per French, Tamberlin JJ and myself.
77 The Court must be cautious against finding fraud merely because there has been an imitation of another's goods, get-up, method or trading or trading style: Cadbury Schweppes [1980] 2 NSWLR at 861 [33] per Lord Scarman. In that case the trial judge had found that the defendant's deliberate purpose was to take advantage of the plaintiff's efforts to develop its product. The plaintiff had launched its product with mass media advertising at great expense prior to the defendant's product being put on the market. He found that the intention was not to pass off the defendant's goods as those of the plaintiff, but to take advantage of the market developed by the advertising campaign which the plaintiff had initiated. The Privy Council upheld findings that there had been no deception because the goods had been sufficiently distinguished. The plaintiff had needed to show that in doing so the defendant infringed the plaintiff's intangible property rights in the goodwill attaching to its product: Cadbury Schweppes [1980] 2 NSWLR at 861 [35]. Their Lordships upheld the trial judge's finding that although the two cans in which the rival traders marketed their soft drink were of the same size (a stock size and shape in the trade) and similar colour, the defendant had sufficiently distinguished its product. The judge found it could readily be seen that they were different: Cadbury Schweppes [1980] 2 NSWLR at 862-863 [42].