The Respondents and The North Agency
31 Since March 2023, H.A.S. Real Estate has operated a real estate business known as "The North Agency" in the Northern Beaches region of Sydney. The directors of H.A.S. Real Estate, Mr Aldren and Mr Sila, both grew up in the Northern Beaches region of Sydney and have lived in that area since that time.
32 Mr Aldren has worked in the real estate industry in that region since 2006. From 2012 until 2018 he worked for Raine & Horne Dee Why Collaroy and from about 2015 he was consistently ranked in the top 10 agents for Raine & Horne in New South Wales based on sales and commission. In 2018, he was ranked number 4 in Australia and wrote over $1 million in commission. From 2019 until January 2023, Mr Aldren worked at Upstate (previously Raine & Horne Dee Why Collaroy), an independent real estate business in Dee Why. He was the number 1 ranked agent at Upstate based on the number of sales transactions. As a real estate agent, he has always worked on the Northern Beaches. On average in the last 10 years, he has listed and sold around 50 to 70 properties a year.
33 Mr Sila has worked in real estate since 2007. His experience includes having worked in property management and then sales at the Novak Agency based in Dee Why, working as a sales executive at Stone, another real estate agency in Dee Why for about 4 years, and for about five years having been contracted with Upstate in Dee Why, which specialises in the Northern Beaches property market. In the years 2020-2022 inclusive, Mr Sila was among the top 3 performers out of 16 agents for Upstate based on the value of properties sold. In addition to his sales experience, Mr Sila has about 5 years' experience in property management (that is, managing rental properties on behalf of landlords), and has been managing the rent roll at The North Agency.
34 Mr Aldren explains that the name, The North Agency, arose during a conversation in about 2021 with a colleague in a café in which Mr Aldren expressed a desire to set up his own business and said that he didn't want his name on the door, but that he wanted "something cool but based on where we are on the northern beaches". His colleague suggested "The North Agency" and Mr Aldren said in his affidavit that he liked the ring of that name. Mr Aldren says that in his experience, it is important for the name to include, at least initially, a word to describe what the business did. He thought that "The North Real Estate Agency" was too much of a mouthful. Mr Aldren says, and I accept, that at no time during his conversation with his colleague did they discuss "The Agency", being a reference to the business conducted by the applicants. Mr Aldren says that that business was not in his mind during the conversation and he did not regard The Agency as a competitor on the Northern Beaches. At that stage he did not think that they even had an office on the Northern Beaches. He regarded the main competitors of Upstate on the Northern Beaches as being Cunningham, Belle and to a lesser extent Doyle Spillane and for high end properties, Clarke & Hummel.
35 Serious discussions and plans between Mr Aldren and Mr Sila about setting up an independent real estate agency began in about mid-November 2022. Mr Aldren became aware of The Agency Group's office located in Manly in around mid-2022, but still did not regard The Agency Group as a competitor on the Northern Beaches. Mr Aldren suggested to Mr Sila the name "The North Agency", which Mr Sila liked. Mr Sila said that he wanted a name that reflected their connections to the local community and area, as they had both grown up and worked in the Northern Beaches, ie "The North". Mr Sila added that in his experience, "north" is a word that comes up in real estate sales all the time, as nearly all buyers want a property that faces north to get the natural light and sunshine. Mr Sila added that "The North" also suggests the idea of "find your true north" which he sees as a positive value. Mr Sila said that the "Agency" component of "The North Agency" was not something that he considered very carefully at all, and for him it simply described the real estate business, and he thought it sounded good with "The North" and it flowed.
36 Mr Aldren and Mr Sila had discussions in December 2022 concerning the name with Mr Dan Argent of UrbanX, and Mr Argent sent a mock-up of some logos for "The North Agency" and "The NTH". UrbanX provides back-of-house, branding, marketing, and administrative services to independent real estate agency businesses. Mr Argent also sent a text message with a logo he had found which had a degree symbol after the letters "NTH", which Mr Aldren liked as it reinforced the location and direction. A further discussion between Mr Aldren, Mr Sila and representatives of UrbanX occurred on 20 December 2022 concerning branding and branding concepts, in which Mr Aldren said: "I don't want to be associated with another brand, I don't want someone else's baggage - good or bad", and "our main competitors will be Upstate, Cunninghams and Belle". Mr Aldren expressed a preference for the name "The North Agency", although Mr Argent had told him after looking at his mobile phone that someone else had registered that (presumably as a business name) but it was being de-registered and he would follow it up. Mr Aldren says, and I accept, that at no time during the meeting was the applicants' business "The Agency" mentioned or discussed, nor was The Agency Group in his mind. In early January 2023, Mr Aldren double checked the website at www.business.gov.au and found that "The North Agency" was available. On 5 January 2023, Mr Aldren applied to register "The North Agency" as a business name.
37 On 24 January 2023 a further discussion occurred between Mr Aldren, Mr Sila and representatives of UrbanX. Various concepts were presented by UrbanX with concept 1 corresponding to the N Logo which was ultimately adopted. Mr Aldren says that he really liked the logo of concept 1 because it used the degree symbol and the "N" was like a compass point or arrow, picking up the theme of "The North". Concept 3 employed black, grey, cream and white colouring, and a decision was made at that meeting to proceed with concept 1 with the colours and font of concept 3. Mr Sila says that the N Logo represented the letter N, together with the degree symbol reinforcing the "North" name and capturing the "true north" idea, which he thought looked good and would stand out among their competitors. Ms Nielson of UrbanX worked on the N Logo as a graphic designer, and gave evidence, which I accept, that she wanted to play on the location of the Northern Beaches using the idea of a compass. She also wanted to play on negative space by deleting the final stroke of the "N" in the icon, and she placed the degree symbol at the top of the deleted vertical line to represent pointing to the north. On 25 January 2023, UrbanX sent to Mr Aldren and Mr Sila the revised concept document called concept 4. Mr Aldren and Mr Sila then had a discussion in which they looked at the concept documents and the branding of other agencies on realestate.com.au and Domain. They decided that they would not use navy colouring because they did not want to look like the others, and decided that they would go with the charcoal colour as no one else on the Northern Beaches was using charcoal. They did not look at or consider The Agency Group or its website as part of that process. On 1 February 2023, UrbanX sent through by email a revised concept document called concept 5. On 6 February 2023, a further meeting between Mr Aldren, Mr Sila and representatives of UrbanX took place at their new office in Dee Why, and a decision was made that, as no one appeared to like the charcoal, they would go back to the navy colour.
38 From 6 February 2023, discussions took place concerning the website for the new business, to be known as The North Agency. Mr Aldren and Mr Sila wanted to have a location shot at the top of the website, similar to the one used in the brand concept documents with the logo over the top of the location shot. Mr Aldren engaged a photographer to do the photography for the website, including the location shot at the top of the website. Mr Aldren left it up to the photographer as to the shots that he should take. On about 21 February 2023, another meeting took place between Mr Aldren, Mr Sila and representatives of UrbanX in the Dee Why office. Everyone present agreed on the main shot for the website, being a shot of the ocean pool at Collaroy. No instruction was given to the photographer to take "twilight" shots, consistently with the way in which Mr Aldren has engaged that photographer over a number of years. Ms Nielson explained in her evidence that there are two ways to make text easily legible and stand out: one is to use a dark colour on a light background, and the other is to use a light colour on a dark background.
39 On 14 February 2023, a discussion took place between Mr Aldren, Mr Sila, representatives of UrbanX and Mr Shane Slater of Realtair, who is also an agent at The Agency Group's Neutral Bay office. Realtair is a real estate software company. During that meeting Mr Slater asked what name they were going with, and when Mr Sila replied, "The North Agency", Mr Slater responded: "It sounds a lot like The Agency." Mr Aldren responded: "No, because we're The North." Nothing further was said about the name, and Mr Aldren says that he did not think that their name would be confused with The Agency Group. I accept that evidence, which was not challenged in cross-examination. Similarly, Ms Nielson's evidence, which I accept, was that while she was aware of The Agency Group, she did not consider The Agency Group, their branding or their website at any time before or during the design process for The North Agency, and The Agency Group did not come up in any discussions.
40 In the first week of March 2023, the external signage for H.A.S. Real Estate's new office at Dee Why was completed. In around mid-March the internal signage for the office was completed.
41 On or about 17 February 2023, representatives of UrbanX set up the Instagram account for The North Agency. The initial version was the navy colour of the branding of the new business and the current version is the cream colour of the branding and reflects the colour scheme of the external signage at the office. A short video was posted on the Instagram account on 2 March 2023, which displays prominently the N Logo. A Facebook page was also set up on or about 17 February 2023. Marketing materials were also developed and by mid-April, The North Agency had spent approximately $25,510 on branded material, including business cards, letter drop material, tear drop signs, clothes, merchandise, office folders, bidders' cards and doormats.
42 The North Agency currently has six employees, comprising three sales consultants, a property manager, a head of operations and an executive assistant.
43 The effect of Mr Sila's and Mr Aldren's evidence is that at the time they were making arrangements and decisions for setting up their new real estate agency, they were aware of the existence of The Agency Group, however they did not look at The Agency Group's website, and The Agency Group did not cross their minds at all in the process of deciding on the name or the branding for their new agency, including when they were considering their logo and their website. Neither of them intended to choose a name or branding which would cause any confusion with The Agency Group's name or branding. On the contrary, they wished to differentiate themselves from other real estate agencies. At no time during the discussions involving Mr Aldren, Mr Sila and representatives of UrbanX about name and branding, did anyone mention The Agency Group (with the exception of the discussion with Mr Slater) until letters of demand preceding the present proceedings were sent. Both Mr Aldren and Mr Sila regarded their key competitors as being Cunninghams, Belle (Dee Why), Doyle Spillane and Upstate, and did not consider that The Agency Group was one of their key competitors. I accept all of that evidence, which was not challenged in cross-examination.
44 Both Mr Aldren and Mr Sila gave evidence, which I accept, as to industry practice in terms of attracting customers. Mr Aldren's evidence is that in his experience, when a vendor wants to list their property, they list with an agent first and an agency second, because the relationship and trust with the individual agent is what is most important. In his experience, it is the agent, not the agency, who gets the listing for sale. It is also Mr Aldren's experience that the decision as to which agent to engage is a big decision that is carefully considered by the vendor. Mr Aldren says that working for a known franchise or brand can assist an agent who is just starting out and does not have an existing reputation in the area, as the agent can also rely on the sales and reputation, in the area, of that known franchise or brand. All this is Mr Aldren's experience across the real estate industry as a whole, and in particular on the northern beaches. As to contact with buyers, Mr Aldren is typically contacted or interacts with buyers in two major ways. First, a buyer, who has seen a property of interest on realestate.com.au or Domain, contacts Mr Aldren through the website or directly using the contact details on the website. Second, a buyer who comes to an open house inspection is required to provide a name and phone number before entering the property, and the buyer is then entered in the customer relationship management system and is followed up with a phone call or other communication. In Mr Aldren's experience, a buyer usually comes to an open house inspection having seen the property advertised on realestate.com.au or Domain. In Mr Aldren's experience, it is the property and the price, not the agent or agency, that causes a buyer to contact an agent or agency.
45 Mr Sila gave evidence, which I accept, concerning customers for property management services. The agreements and prospective agreements which H.A.S. Real Estate has with landlords have all come from previous clients or from referrals from previous clients to their friends or family members or people known by Mr Sila in the local community. In Mr Sila's experience, apart from previous or existing clients and referrals, the main source of new management business is purchasers of properties which he has sold. In Mr Sila's experience, it is the individual agent rather than the agency brand that primarily attracts listings. In his experience, prospective tenants generally come to him through the Domain or realestate.com.au websites, both of which have a tab entitled "Rent", on which the user clicks and searches by the available search criteria which include "Suburb" or "Location" and "Property Type". In his experience, having found potential rental properties on one or other of those websites, prospective tenants then email, call or text the agent with any queries about the properties and the rental application processes commence from there.
46 As to the importance of attracting customers in the real estate business by way of word of mouth, Mr Aldren accepts that that is an important means of attracting customers. However, in his experience, it is the agent, not the agency that secures a listing for sale, and it is the property and the price, not the agent or agency that causes a buyer to contact an agent or agency. I accept that evidence.