In Newman Ltd v Adlem
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE JACOB,Lord Justice Jacob,Lady Justice Arden,Lord Justice Tuckey,LORD JUSTICE TUCKEY |
| Judgment Date | 21 June 2005 |
| Neutral Citation | [2005] EWCA Civ 944,[2004] EWCA Civ 1557,[2005] EWCA Civ 741,[2004] EWCA Civ 1492 |
| Docket Number | A3/2004/1336 A3/2004/1871,Case No: A3/2004/1336 HC 03C02389,A3/2004/1869,Case No: A3/2004/1869 & A3/2004/1871 |
| Court | Court of Appeal (Civil Division) |
| Date | 21 June 2005 |
[2004] EWCA Civ 1492
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHANCERY DIVISION
Mr Nicholas Warren QC
Royal Courts of Justice
Strand, London, WC2A 2LL
The Right Honourable Lord Justice Jacob
Case No: A3/2004/1336 HC 03C02389
DECIDED, BY CONSENT, ON THE PAPERS
Jacob LJ:
This an application for permission to appeal the decision on costs made by Nicholas Warren QC, sitting as a Deputy Judge of the Chancery Division, on 8 June 2004.
The matter should have come before me on 9 November 2004 when I dealt with the number of other applications for permission to appeal made by each side in the main action. Mr Sherman, who has been permitted to represent the defendant in these proceedings, realistically accepted before me that I could and should deal with the question on the papers, not least because the sum involved is rather small, being of the order of £400.00.
The Deputy Judge was dealing with a procedural application by the claimant company for permission to serve its witness statements out of time. Under the original order the date for the exchange of witness statements was 16 January 2004. The claimant wanted disclosure and, for that reason, did not serve the statements in time. Disclosure was in due course given (I need not go into detail) and the witness statements were served on 20 May, which was some five weeks before the trial was due to proceed on 28 June.
Although complaint was made of the lateness, Mr Warren held that there was no prejudice to the defendants by reason of the late service of the witness statements. He permitted late service. He concluded:
"It would in my judgment, be entirely inappropriate and disproportionate to refuse to admit this evidence. It will in practice mean that the claimant could not proceed with its action. I have no doubt that it is appropriate to admit it and I make an order accordingly."
No complaint is now made about the admission of the evidence. The complaint is simply that Mr Warren ordered the defendant to pay the claimant's costs. The grounds for appeal, although set out in six somewhat detailed paragraphs, boil down to this:
i) That it was the claimants who were late with the evidence;
ii) it was they who needed permission to get it in late;
iii) and it should be they who pay the costs of getting it in.
I have no doubt that this argument is fallacious. It relies upon a formalistic approach to the rules of court, an approach which, whatever the position in the past, is now to be deprecated. It was the defendant who specifically required formal application to court for the evidence to be admitted. He indeed went further and opposed its admission. If the defendant had instead consented the matter could have been dealt with at no or trivial cost. It was the defendant who caused the costs of the application.
In the circumstances I think that the Judge's order was entirely right. And it was certainly within the wide discretion given to a Judge when he comes to the question of costs. No error of principle is shown and there is no reasonable prospect of success on appeal.
I would add that I have dealt with this matter without the views of the Judge on the question of whether or not permission to appeal should be granted, for permission was never sought from him as it should have been. In the end this made no difference to my decision however. I have no doubt that the Judge, if he had been asked, would have refused to grant permission.
Order: Permission to appeal refused
(Order does not form part of approved judgment)
[2004] EWCA Civ 1557
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT
(MR D YOUNG QC
(sitting as a deputy High Court judge))
Royal Courts of Justice
Strand
London, WC2
Lord Justice Jacob
A3/2004/1336
A3/2004/1869
A3/2004/1871
MR M CHACKSFIELD (instructed by Messrs Whitehead Vizard, Salisbury SP1 2PQ) appeared on behalf of the Applicant Claimant
The Respondent Defendant appeared on his own behalf assisted by MR N SHERMAN as a McKenzie friend
I have before me cross-applications for permission to appeal. The claimants sued the defendant in passing off. The defendant had a registered trade mark. The claimants sought a declaration of non-infringement of that trade mark by virtue of section 11(3) of the Trade Marks Act.
The judge held there was no passing off, but granted the declaration. The upshot of the position was that the claimants could go on using the name "Richard T Adlem", which they claimed they had bought the right to by virtue of being successors in title to the purchaser under an agreement of 31st December 1993.
So far as the application for permission to appeal in the passing off is concerned, the claimants say the judge made an error of law. They say that when a party sells its goodwill, that includes the attractive force which the trading name of that party has. That includes the right to use the name. The consequence of such a sale is that the vendor can no longer use that name in his business, whether he starts immediately after the sale or (as in this case) some years later (for in this case Mr Adlem was under a five-year non-compete covenant). The claimants say that the law regards any such use by the vendor as amounting to a misrepresentation: it is a misrepresentation by the vendor that he is the business which he has just sold.
I think the point here has reasonable prospects of success. There has always been a mismatch between the passing off rights and the rights conveyed on a sale of a business or of a trade mark, because the vendor may say, "But the name always means me to the public." On the other hand, he has expressly agreed not to use that name effectively by the agreement. I give this permission on the basis that the agreement of 1993 does indeed convey the goodwill of the business which was being conducted by Mr Adlem, as it seems to me that it clearly and unarguably does.
I turn to the permission sought by Mr Adlem. The first permission sought was that he should be granted an opportunity to challenge the conclusion I have just stated, namely that the agreement sold the benefit, right and entitlement to use the goodwill of the business which he had sold. I cannot see how that can possibly be open on this document. "The Goodwill" is defined as:
'… the goodwill and connection of the Business together with the right to represent the Purchaser as carrying on the Business in succession to the Vendor."
"The Assets" means:
'… all and any of:
(i) the Goodwill
(ii) the equipment …"
The goodwill was bought. I would not give permission and do not give permission in relation to the effect of the agreement.
Next permission is sought in relation to the section 11(3) of the Trade Marks Act 1994 point, the prior right section. I give permission here because this section, so far as I know, has never been considered by the Court of Appeal, but only in relation to questions of law which arise in relation to the section. The judge's findings of fact remain as they stand and I give no permission to challenge the judge's findings of fact in relation to this point. In parentheses I add that I do by my first permission to the claimants impliedly give permission to challenge the judge's finding of fact that there is no misrepresentation, that being part of the detailed question of what happens when there is an assignment of goodwill.
Finally, I am asked for permission to appeal from the judge's decision on costs. The judge said that but for an offer that had been made by the claimants, he would have minded to order that each side pay their own costs. But he took into account the offer, not as a Part 36 offer (the offer did not fully comply with the rules as far as Part 36 concerned) but because, broadly speaking, the offer set out what the result in the event was, and if it had been accepted or accepted with minor variations then the litigation would not have been necessary thereafter. The offer had been repeated a number of times. As a consequence, the judge thought that Mr Adlem bore some responsibility for the litigation going on and made an apportionment of the figure. That seems to me to be well within the discretion of any trial judge and cannot be faulted as in any way wrong in principle.
So I grant these two limited permissions. I grant no other. I strongly recommend to the parties that they enter into a mediation process. The legal costs of either side of winning the points they win will probably not be worth it. The claimants have for a long time indicated at least an acceptance that maybe Mr Adlem can carry on using his name in his business, which is the result of what the judge achieved. I would hope that a sensible discussion whereby Mr Adlem is permitted to carry on using the name so long as he is in the business on a personal and non-assignable basis would be something that the parties could find a way of living with.
ORDER: Applications for permission to appeal granted; costs of today's applications to be costs in the appeal on both sides; counsel to draft and lodge a minute of order; time estimate of 1 12 days; constitution of three Lords Justices,...
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