Rofa Sport Management A.G. v DHL International (U.K.) Ltd

Court:Court of Appeal
Docket Number:89/0204
Judge:LORD JUSTICE NEILL, LORD JUSTICE RALPH GIBSON, LORD JUSTICE MAY
Judgment Date:02 Mar 1989
Jurisdiction:England & Wales
Neutral Citation:[1989] EWCA Civ J0302-2

[1989] EWCA Civ J0302-2

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

(Mr. Justice Rougier)

Royal Courts of Justice

Before:

Lord Justice May

Lord Justice Neill

and

Lord Justice Ralph Gibson

89/0204

Between:
(1) Rofa Sport Management A.G
(2) ISL Marketing A.G
Appellants (Plaintiffs)
and
(1) DHL International (UK) Limited
(Defendants)
(2) Sport Billy Productions R. Deyhle
Respondents (Defendants)

MR. S. ISAACS (instructed by Messrs Theodore Goddard) appeared on behalf of the Appellants/Plaintiffs.

MR. P. IRVIN (instructed by Messrs Daynes Hill & Perks) appeared on behalf of the Respondents/Second Defendants.

LORD JUSTICE NEILL
1

This is an appeal by the plaintiffs from the order of Rougier, J. dated 25th February 1988, whereby he dismissed an appeal from the order of Master Lubbock dated 22nd January 1986. By the order dated 22nd January 1986, Master Lubbock ordered that Sport Billy Productions R. Deyhle ("Sport Billy") be added as second defendants to the action pursuant to Order 15, rule 6(2) of the Rules of the Supreme Court.

2

The plaintiffs in the action are Rofa Sport Management AG ("ROFA") and ISL Marketing AG ("ISL"). By a written agreement dated 11th July 1982, between the Federation Internationale de Foot Association ("FIFA") and ROFA, ROFA were granted the exclusive right to appoint certain companies as official suppliers/sponsors for the FIFA World Cup which was due to be held in Mexico in the summer of 1986. In due course ROFA appointed ISL as their exclusive marketing agents. Both ROFA and ISL are Swiss companies.

3

In about May 1985 it came to the attention of ROFA that DHL International (UK) Ltd. ("DHL") were describing themselves as the "official world-wide couriers to the FIFA World Cup 1986". ROFA's solicitors wrote a letter of complaint dated 21st May 1985, stating that in the light of an agreement between FIFA and ROFA, DHL were not entitled so to describe themselves. DHL replied that they were entitled to use this description because they had been granted a licence by Sport Billy, who were the transferees from FIFA of "the exclusive commercial rights relating to all marks and designs of FIFA." There was then some further correspondence but it proved inconclusive.

4

On 26th July 1985, ROFA and ISL issued a writ against DHL and also a summons seeking an interlocutory injunction. The date for the hearing of the summons was later fixed for 23rd August 1985.

5

The main relief claimed in the writ was as. follows:

"1. An injunction to restrain the Defendants, whether acting by themselves, their directors, servants or agents or otherwise howsoever from describing themselves or holding themselves out in any way whatsoever as being the official worldwide courier to the FIFA World Cup, 1986.

2. Damages for interference by the Defendants with the contractual relations between the Plaintiffs and FIFA and for passing off by reason of the Defendants' use of the description of themselves as the Official Worldwide Courier to the FIFA World Cup, 1986."

6

On the same day, 26th July 1985, Sport Billy became aware of the proceedings. Their solicitors got in touch with DHL's solicitors and a few days later told them that Sport Billy would apply to be added as co-defendants. Before, however, Sport Billy had taken any formal steps to be added as co-defendants the plaintiffs and DHL had achieved a settlement. A consent order dated 14th August, 1985, was made in the following terms:

"Upon the parties agreeing terms

AND BY CONSENT

It is ordered that all further proceedings in this action be stayed, the parties having agreed terms of settlement, and it is further ordered that there be no order as to costs."

7

The order bore the written consent of DHL's solicitors dated 13th August.

8

On 15th August DHL's solicitors informed the solicitors for Sport Billy of the settlement. It seems that the solicitors for Sport Billy expressed surprise as they had previously understood that the summons for an interlocutory injunction was due to be heard on 23rd August. On 16th August, Sport Billy issued a summons to be heard before the judge in chambers on 23rd August seeking to be joined as parties in the action. This summons was later replaced by a summons issued on 20th August for hearing before a Master.

9

The later summons came before Master Lubbock on 22nd January 1986, when he ordered that Sport Billy should be added as second defendants in the action. The purpose of such joinder was explained by Mr. Peter Armstrong, a partner in the firm of solicitors acting for Sport Billy, in an affidavit sworn on 22nd August 1985, in these terms:

"The interveners have substantial interest in the matters in dispute in these proceedings, namely the question of the extent of their contractual rights obtained from FIFA compared with those obtained from FIFA by the plaintiffs. The interveners have granted sub-licences to other organisations operating in the U.K. and wish to grant similar rights in respect to other goods or services to others. Those clients and potential clients are all potential subjects of similar attack by the plaintiffs under circumstances where the commercial pressure of such an attack may be wholly disproportionate to the legal strength of the plaintiffs' claim. Furthermore, the plaintiffs' attack on the defendants as bona fide sub-licensee of the interveners may give rise to issues between the interveners and the defendants and I submit that it is wholly appropriate for the interveners to have an opportunity of ventilating the true, underlying issues in this action."

10

The plaintiffs appealed against Master Lubbock's order. The appeal was heard by Rougier J. on 6th March 1987, when he dismissed the appeal. Though by then the 1986 World Cup had taken place the matter remained a live issue between the parties because of disputes which were likely to arise in relation to the next World Cup in 1990.

11

It was argued on behalf of the plaintiffs before the judge that though the consent order was in form an order for a stay, it was in fact an order for the discontinuance of the action. Accordingly, it was argued, the action came to an end on 14th August 1985, and the court had therefore no jurisdiction to entertain any summons issued after that date or to make an order under RSC Order 15, rule 6(2). In the alternative it was submitted that it was a wrong exercise of any discretion vested in the court under this rule to make an order in the circumstances of this case, where the previous parties had already finally disposed of their differences and had reached a binding settlement.

12

The judge rejected both these arguments. We have been provided with a note of his judgment which he approved on 12th June 1988. On the question of jurisdiction the judge said that he was attracted by the Master's approach, namely because there are two different methods of arresting proceedings, one by a stay and the other by discontinuance, they must mean different things. He concluded that the action was still alive.

13

On the question of discretion, the judge said that he was not impressed by the argument that the plaintiffs would suffer prejudice. He continued:

"I was at one point concerned whether the intervener was equally protected by being able to sue in Switzerland but it is here that Sport Billy's name has been impugned. I am not attracted by the plaintiffs taking a swipe at a sub-licensee of the main licensee and then claiming that the main licensee cannot defend himself here. It would be unjust not to allow them to defend."

14

It seems, however, that at some stage during the hearing counsel for the plaintiffs raised the further question whether the consent order of 14th August 1985 correctly reflected the agreement which had been reached between the plaintiffs and DHL, and whether the order should be rectified. The judge therefore expressed his conclusion on the appeal in these terms:

"Therefore I find….. that the action remains alive and….. subject to the question of rectification I would exercise my discretion to allow the interveners to intervene."

15

On 10th March 1987 the plaintiffs issued a summons for rectification of the order of 14th August 1985 so that the word "discontinued" should be substituted for the word "stayed", and that the words "all further proceedings in" should be deleted. On 10th October 1987 this summons was heard by Master Lubbock and was dismissed. Finally, on 25th February 1988, an order was made by consent giving effect to the decision of Rougier J. on 6th March 1987, in the light of the subsequent dismissal of the claim for rectification. By this order the plaintiffs were given leave to appeal to this court.

16

The principal argument in this court on behalf of the plaintiffs was directed to the question of jurisdiction. The argument was developed on these lines:

  • 1) that the court could not make an order under RSC Order 15 Rule 6(2) (b) unless proceedings were still on foot in the cause or matter;

    2) that there were no such proceedings if there was nothing left to be done in the case;

    3) that it is necessary to look not only at the form of consent order but also at its substance;

    4) that an unconditional consent order to stay all further proceedings may operate as a discontinuance or dismissal of the action;

    5) that in the present case the consent order to stay was made pursuant to the settlement of the whole dispute between the plaintiffs and DHL; the order was unconditional and nothing remained to be done in the case;

    6) that the order did not contain any liberty to apply, and that even if it had done the presence of these words would not necessarily have...

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