Philosophy Inc. v Ferretti Studio Srl
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE PETER GIBSON,LORD JUSTICE BROOKE,Lord Justice Peter Gibson |
| Judgment Date | 13 June 2002 |
| Neutral Citation | [2002] EWCA Civ 921 |
| Court | Court of Appeal (Civil Division) |
| Date | 13 June 2002 |
[2002] EWCA Civ 921
Lord Justice Peter Gibson
Lord Justice Brooke
IN THE SUPREME COURT OF JUDICATURE A3/2001/1670
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CHANCERY DIVISION
(Master Bragge)
Royal Courts of Justice
Strand
London WC2
MR RICHARD ARNOLD QC (Instructed by Rowe & Maw, 20 Black Friars Lane, London, EC4V 6HD) appeared on behalf of the Appellant.
MR MICHAEL EDENBOROUGH (Instructed by Taylor Joynson Garrett, Carmelite, 50 Victoria Embankment, London, EC4Y 0DX) appeared on behalf of the Respondent.
Thursday, 13th June 2002
This appeal relates to a registered trade mark, Philosophy di Alberta Ferretti ("the Mark"), which is registered for "soaps, perfumery, essential oils, cosmetics, hair lotions". The application for registration was filed on 5th December 1994 and the registration procedure was completed on 19th January 1996. The defendant, Ferretti Studios SRL, is the registered proprietor. On 15th February 2001 the claimant, Philosophy Incorporated, which is an American corporation incorporated under the laws of Arizona, applied under CPR Part 8 for the revocation of the Mark for non-use pursuant to section 46(1)(a) of the Trade Marks Act 1994 ("the Act"). Master Bragge heard and determined the application. Both sides had filed evidence, but there was no cross-examination. The Master dismissed the application, on the basis that there had been genuine use of the Mark within the period of five years following the date of the completion of the registration procedure, and held that even if there had not been, there were proper reasons for non-use within that period. The Master refused to make an order for partial revocation. He rejected a preliminary objection taken by the defendant that the application had been brought prematurely. The Master refused the claimant permission to appeal, but permission was granted by Jonathan Parker LJ. The defendant by a Respondent's Notice seeks permission to cross-appeal on the premature application point, and we gave that permission.
It is convenient at this point to set out the legislative provisions which govern the dispute. Article 12 of the First Council Directive 89/104 of 21st December 1988 dealt with grounds for revocation of a registered trade mark. Effect was given to that part of the Directive by section 46 of the Act. Section 46 provides, so far as material:
"(1) The registration of a trade mark may be revoked on any of the following grounds—
(a)that within the period of five years following the date of completion of the registration procedure it has not been put to genuine use in the United Kingdom, by the proprietor or with his consent, in relation to the goods or services for which it is registered, and there are no proper reasons for non-use. …
…
(3) The registration of a trade mark shall not be revoked on the ground mentioned in subsection (1)(a) or (b) if such use as is referred to in that paragraph is commenced or resumed after the expiry of the five year period and before the application for revocation is made:
Provided that, any such commencement or resumption of use after the expiry of the five year period but within the period of three months before the making of the application shall be disregarded unless preparations for the commencement or resumption began before the proprietor became aware that the application might be made.
…
(5) Where grounds for revocation exist in respect of only some of the goods or services for which the trade mark is registered, revocation shall relate to those goods or services only."
There are four issues raised by the appeal and the cross-appeal:
(1) Was the application premature?
(2) If not, was there genuine use of the Mark within the five-year period?
(3) If not, are there proper reasons for the non-use?
(4) If either or both of issues (2) and (3) is, or are, resolved in favour of the proprietor, should there be a partial revocation of the registration?
(1) Premature application
The five-year period ran from 20th January 1996. The application for revocation was made within three months from the expiry of that period. Mr Edenborough for the defendant says that that is not permissible under the Directive or section 46(3). He contends that the earliest an application can be brought is the day after the expiry of a further period of three months from the expiry of the five-year period, and he submits that that is apparent from the proviso to section 46(3) which refers to that period as commencing after the expiry of the five-year period and being before the making of the application. Similarly, Article 12.1 refers to a period of three months preceding the filing of the application for revocation which began, at the earliest, on expiry of the continuous period of five years. This is not in fact a case where the main part of section 46(3) applies by reason of a commencement or resumption of use after the five-year period but before the application for revocation. But on Mr Edenborough's submission that is immaterial. His argument is purely one of construction of the statute read in the light of the Directive.
On this point the Master said this:
"It seems to me that on the proper construction of Section 46 it is possible for a claimant/applicant to make a claim for revocation in any case where five years have elapsed since the date of completion of the registration procedure and there is no requirement to wait for any further period. What in essence Section 46 does is to give a registered proprietor a period of five years from the date the mark is actually put on the register to put it into use. I observe that this analysis coincides with the views expressed by the editors of Kerly's Law of Trade Marks, 13th edition, paragraph 9–43. It does not seem to me that this approach is inconsistent with Article 12 of [the Directive] read as a whole. Article 12 is clear, namely it deals with the relevant period first (i.e. five years), it then deals with genuine use in the interval after the expiry of the five years period and the date of any revocation proceedings, and it then makes for a proviso regarding genuine use in the interval after the expiry of the five year period and the application for revocation. The proviso only arises at the point of the expiry of the five year period of non use and only for the purpose identified. Unlike Section 26(1)(b) of the Trade Marks Act 1938 the present Act does not in my view provide for any period of grace. Accordingly I cannot accept the submission made to me that Section 46 is, in fact, similar to the five year and one month period that was required under section 26."
Mr Arnold QC for the claimant supports the Master's reasoning. He argues that Mr Edenborough's argument involves an over-fine textual analysis which is inappropriate when interpreting European Community legislation. He says that the purpose of the three-month period is clear. It is to give the prospective applicant seeking revocation three months in which to seek to resolve matters with the proprietor by negotiations. If the proprietor commences use of the trade mark only when he gets wind of the prospective application, such use will be disregarded provided the application is filed within three months. Article 12 and section 46, he says, are both clear that the relevant period in which use of the Mark must be commenced is five years, not five years and three months.
I agree with Mr Arnold. There can be no doubt that by section 46(1) the period of five years is the governing period for non-use. By the main part of section 46(3) the proprietor is informed, and the applicant for revocation is warned, that if there is a commencement or resumption of use after the expiry of the five-year period before the application for revocation is made, revocation will not be granted. But that is made subject to a limited exception introduced by way of proviso for the benefit of the applicant for revocation. The commencement or resumption is to be disregarded within a limited period, unless preparations for the commencement and the resumption begin before the proprietor became aware that the application might be made. This limited proviso cannot commence earlier than the expiry of the five-year period and is brought to an end by the application. It is expressed to be a three-month period. There is no problem if the application for revocation is delayed until at least three months have expired after the expiry of the five-year period. The problem arises if the applicant for revocation applies within three months from the expiry of the five-year period. But I pose the question: why should not the applicant for revocation apply promptly after the end of the five-year period? I can see no legislative purpose in not allowing such a prompt application. Further, one might expect that a prompt application would serve the legislative purpose better. Trade marks confer a statutory monopoly on the proprietor. Their function is to give that monopoly to the proprietor for the use of the trade mark. If it is not used for the five-year period, it should be revoked. The editors of Kerly say in paragraph 9–43:
"The application for revocation can be brought as soon as five years has elapsed. In fact, if an application under section 46(1)(a) is contemplated it is normally prudent to commence the application as soon as possible after the five-year period has elapsed, for reasons connected with other constraints imposed by the Act.
Then in paragraph 9–44:
"The general effect of this is that it is risky to delay commencing the application for revocation…"
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