Baume & Company Ltd v A. H. Moore Ltd

The judgment about to be delivered by my brother Romer is the judgment of the Court in this case.

LORD JUSTICE ROMERs This is an appeal from an Order of Mr. Justice Danckwerts dismissing the plaintiffs' action in which they sought an injunction restraining the defendants from infringing the registered trade mark of the plaintiffs and from passing off watches not being the goods of the plaintiffs as the plaintiffs' watches.

The plaintiffs' trade mark consists of the word "Baume" and it was registered in 1878 in Class 10 of Schedule 113 for watches and all other descriptions of horological instruments. They and their predecessors in title have carried on business in the sale of watches since 1834. The watches are made for them by a firm in Switzerland called Mildia and are imported into this country and sold by the plaintiffs. It was admitted by the defendants that, since at least 1880, the plaintiffs' business of selling watches has been carried on by them or their predecessors under the trade mark "Baume"; that such business is a substantial one; and that for many years past substantial moneys have been expended in advertising.

The defendant company carry on business as watch importers and they sell directly to wholesalers. In about 1954 they entered into business relations with a Swiss Company called Baume & Mercier, Societe Anonyme, of Geneva, and began to import watches made by that company into this country for sale. These watches are supplied by the defendants to wholesalers in boxes, on the outside of which is printed the name "Baume & Mercier Geneva" and that name is also printed on the face of the watches themselves.

The plaintiffs' case, as pleaded by paragraph 5 of their statement of claim, is that "the use of the word 'Baume' as part of the name of the watches dvertised, offered for sale and sold by the defendants is an infringement of the plaintiffs' said registered trade mark and it is further calculated to deceive and cause confusion and to lead the trade and public to believe that the goods offered for sale or sold by the defendants are goods of the plaintiffs' manufacture or merchandise and is calculated to pass off or enable others to ass off goods not of the plaintiffs' manufacture or merchandise as and for the plaintiffs' goods.

In his judgment, the learned judge, after considering the evidence which had been called before him, said: "In a matter of this sort, it is always rather difficult to see how far confusion really is likely or possible, and what exactly the public will do in the absence of positive evidence of actual deception. On the whole, I have come to the conclusion that the names are sufficiently similar that members of the public would not necessarily be likely to perceive that 'Baume & Mercier' was not the same as 'Baume', and I think, therefore, that there is some probability that confusion might occur in England in respect of the sale of the watches. The learned judge, however, dismissed the action in so far as it was founded upon infringement of the plaintiffs' trade mark on the ground that the defendants were entitled to the protection afforded by section 8 of the Trade Marks Act, 1938; and, in so far as the plaintiffs' claim was based upon passing off, the judge dismissed it on the ground that there had been an honest user by the defendants of the makers' own name.

We first propose to consider the issue of passing off. It is quite clear on the evidence, and indeed from the defendants' admission to which we have already referred, that the name "Baume" has, for many years past, been associated in this country with the watches distributed by the plaintiffs. The questions on this part of the case would accordingly appear to be: (l) Have the plaintiffs established that the sale by the defendants of Baume & Mercier watches is reasonably calculated to cause confusion in the trade and in the minds of the public; and (2) If so, is it a valid defence for the defendants to show (as they did show to the learned judge's satisfaction) that there had been an honest use by them of the makers' own name? Taking the second question first, it is to be observed that this is not a case of a defendant carrying on a business under a name, but of marking goods with a name. The distinction between these two classes of case was emphasized and explained by Mr. Justice Romer, as he then was, in Joseph Rodgers & Sons Limited v. W.N. Rodgers & Company, reported in 41 Reports of Patent Cases, page 277. "It is the law of this land", he said at page 291, "that no man is entitled to carry on his business in such a way as to represent that it is the business of another, or is in any way connected with the business of another; that is the first proposition. The second proposition is that no man is entitled so to describe or mark his goods as to represent that the goods are the goods of another. To the first proposition there is, I myself think, an exception: a man, in my opinion, is entitled to carry on his business in his own name so long as he does not do anything more than that to cause confusion with the business of another, and so long as he does it honestly. It is an exception to the rule which has of necessity been established, … To the second rule to which I have referred, I think there is no exception at all; that is, that a man is not entitled so to describe his goods as to lead to the belief that they are the goods of somebody else. It is not necessary that there should be an exception to that. It is perfectly legitimate for a man in the cutlery business to carry on business under his own name, whatever that name may be, but I can see no necessity for his marking his cutlery with a name (although it be his own name) which may have the effect of passing off those goods as the goods of the Plaintiffs".

Whether or not the learned judge may have expressed the exception to the first of the two rules too widely it is not necessary, for present purposes, to consider; but he said (quite rightly in our opinion) that there is no exception to the second rule and it is that rule which is relevant to the present case. In Reddaway v. Banham, reported in 13 Reports of Patent Cases, page 218, Lord Herschell, after referring to Burgess v. Burgess, reported in 3 De Gex, Macnaghten and Gordon, page 896, said at page 229 of the reports "This, I think, clearly recognises that a man may so use even his own name in connection with the sale of goods so as to make a false representation"; and see also Valentine Meat Juice Company v. Valentine Extract Company, Ltd., reported in 17 Reports of Patent Cases, page 673.

The next point which arises is whether it is a valid defence to an action for passing off that the defendant had no intention to deceive. In our judgment, it is clearly not, for fraud is not a necessary constituent of such an action. This clearly appears from the judgment of Lord Justice Buckley in John Brinsmead & Sons, Limited. v. Edward George Stanley Brinsmead, reported in 30 Reports of Patent Cases, page 493. The Lord Justice, in laying down certain propositions with regard to passing off, expressed himself as follows at page 506: "The law, as I understand it, is this if a man makes a statement which is true, but which carries with it a false representation and induces the belief that his goods are the plaintiffs' goods, he will be restrained by injunction. He cannot rely on the fact that his statement is literally and accurately true, if, notwithstanding its truth, it carries with it a false representation.… Secondly, if it is found that a man's object in doing that which he did was to deceive - that he had an intention to deceive - the court will be very much more ready to infer that his object has been achieved if the facts tend to show that that is the case, and to say that his intention to deceive ripening into deceit gives ground for an injunction; but it is "not necessary to prove intention to deceive If the fact is that the act which the defendant is doing docs deceive, with the result that a man, who intends to be a customer of the plaintiffs, is induced by something which the defendant has done to become a customer of the defendant instead, even if the defendant has done that innocently, yet as soon as he learns that in point of fact that which he had no intention of using for the purpose of deceit does create deception, then he is doing that which is wrong, and he will be restrained from pursuing a course of action the result of which is, in point of fact, to take that which is the "plaintiffs' property and give it to him, to defraud the plaintiffs' customers into becoming the defendant's customers. Thirdly, in the application of the principles which I have stated, there is, in my opinion, no difference whatever where the true statement consists in an accurate statement of the defendant's name as distinguished from any other true statement of fact, if of course you have evidence that from the use of his own name deception results. If a trader takes a name which is not his own name, but is that of a rival trader, and uses it in his trade, no doubt that is very strong evidence that he intends to deceive, and the court will fasten upon that in any case in which it occurs; but if that is not so, if he is simply using his own name and it is proved that its use results in deception, he will be...