William Grant And Others V. Glen Catrine Bonded Warehouse And Others
| Jurisdiction | Scotland |
| Judge | Lord President |
| Docket Number | 088/16 |
| Date | 16 May 2001 |
| Court | Court of Session |
| Published date | 16 May 2001 |
FIRST DIVISION, INNER HOUSE, COURT OF SESSION
| Lord President Lord Nimmo Smith Lord Clarke
| 088/16/92 OPINION OF THE LORD PRESIDENT in RECLAIMING MOTION in the cause WILLIAM GRANT & SONS LIMITED and OTHERS Pursuers and Respondents; against GLEN CATRINE BONDED WAREHOUSE LIMITED and OTHERS Defenders and Reclaimers: _______ |
Act: Hodge, Q.C., Dunlop and Cormack; McGrigor Donald
Alt: Jones, Q.C., Robertson; McClure Naismith
16 May 2001
[1]In this case there are three pursuers and respondents. The first pursuers are William Grant & Sons Limited, a company incorporated in 1991. They are the parent company of the second and third pursuers, William Grant & Sons Distillers Limited and William Grant & Sons International Limited. At a procedure roll hearing at a relatively early stage in the proceedings, the Lord Ordinary (Lord Abernethy) repelled the defenders' second plea-in-law relating to the second and third pursuers' title and interest to pursue the action. See William Grant & Sons v. Glen Catrine Bonded Warehouse Ltd. 1995 S.L.T. 936 at pp. 945 E - 946 C. No point is now taken about the title and interest of these pursuers. Before 1991 the business was carried on by a company, William Grant & Sons Limited, which had been incorporated in 1903. In 1991 the first pursuers acquired inter alia the whole industrial property, goodwill and claims to which the original company then had right. At the proof held before Lord Cameron of Lochbroom, the defenders advanced an argument about the supposed extinction of the goodwill of the original company in the course of the reorganisation of the group of companies after the incorporation of the first pursuers. The Lord Ordinary rejected that argument and counsel for the defenders did not reopen it before this court. It follows that nothing now hinges on the exact twists and turns in the saga of the development of the pursuers' business structure. For the sake of simplicity, I shall therefore generally refer to "the pursuers", irrespective of the exact entity which may have been involved at any particular time.
[2]The defenders and reclaimers are three companies: first, Glen Catrine Bonded Warehouse Limited, secondly, William Morton Limited and, thirdly, A. Bulloch & Company (International) Limited. Again, for most purposes it will not be necessary to differentiate among them and I shall simply refer to "the defenders", except where one particular company was involved in an aspect of the business.
[3]As the Lord Ordinary's long and detailed opinion reveals, in the Outer House a very large number of matters, both of fact and law, were in dispute between the parties. Before this court, by contrast, the issues had narrowed. In particular, the defenders did not challenge the Lord Ordinary's finding that they had passed off their gin and vodka as the pursuers'. By far the most important question in the reclaiming motion, which was debated at length in the hearing, was whether the pursuers' right to interdict had been barred by their delay in raising proceedings, resulting in their being held to have acquiesced in the passing off. Secondly, even if the pursuers' claim was not barred by reason of acquiescence, the defenders contended that, again by reason of their delay, the pursuers were not entitled to the remedy of interdict. Since the pursuers have no conclusion for damages, the question of their entitlement, if any, to that remedy was not explored. Next, the defenders argued that the interdict granted by the Lord Ordinary was too wide since it would prevent them from exporting to countries where, it might be, the applicable law did not prevent the defenders from passing off their spirits as the pursuers'. Finally, the defenders argued that, even if the pursuers were entitled to interdict against the defenders from passing off their spirits as the pursuers' in the United Kingdom and elsewhere, an interdict which had the effect of preventing the defenders from exporting their products to the other Member States of the European Community contravened Article 29 (ex Article 34) EC. For their part, the pursuers cross-appealed against the Lord Ordinary's decision not to grant interdict against the defenders from passing off their business as the pursuers' in terms of the first conclusion.
[4]I propose to deal with each of these issues in turn and to start with the defenders' contention, in their first ground of appeal, that the Lord Ordinary erred in failing to hold that the pursuers had acquiesced in the defenders' passing off of their own gin and vodka as the pursuers'. That argument cannot be dealt with, however, without first setting out the facts upon which it was based. Although a considerable number of pages of the notes of evidence were extended and reproduced for the court, in the event counsel referred to relatively few of them and, indeed, the relevant factual material was not really in dispute. For the most part, therefore, I have been able to rely on drawing together the findings in fact made by the Lord Ordinary at various points in his opinion. The real dispute in the reclaiming motion was as to whether those facts disclosed a basis for holding that the pursuers had acquiesced in the defenders' passing off so as to disable them from obtaining the remedy of interdict which the Lord Ordinary had granted.
[5]The Facts
The pursuers have been distilling whisky since 1887 and, by 1920, they were selling a variety of blended products using labels which included the name Grant's. Although by 1939 the pursuers had built up a substantial overseas business, the greater share of their business remained in the United Kingdom market (23). In the course of the 1970s the pursuers "firmed up somewhat" the use of the name Grant's in order to reinforce the identity of the name (24). In other words, they were building the brand. In about 1985 they began using the name William in conjunction with the word Grant's (2) in order to imply that the pursuers were a real family company. For present purposes, however, what is significant is that, as the chairman of the first defenders, Mr. Bulloch, himself recognised (153), the name Grant's has for long been associated with the pursuers, at least in relation to whisky. Indeed, as the pursuers' brand name, it had been well known to the public since at least the 1940s.
[6]For many years the pursuers concentrated on producing and marketing whisky. From about 1960 onwards, however, this changed. They began to produce and market gin and vodka, especially after the construction of the distillery at Girvan in 1963. To begin with, the design of the label for the gin, which included the name Grant's, was calculated to resemble the labels for the pursuers' blended whisky and Glenfiddich. In about 1970 the design was changed, but the label had the name William Grant's printed in blue and in large letters. When the pursuers began selling vodka on the domestic market, they used the name Light Brigade, which had previously been used for a whisky. The label was similar to the whisky label. In the late 1970s the label was altered to make it resemble the gin label. In the export and duty-free markets the pursuers sold their vodka under the name Grant's Imperial Vodka. Even though the pursuers were producing and marketing gin and vodka in this way, sales of these spirits were always very small by comparison with the sales of their whiskies (25 - 26).
[7]In these circumstances the Lord Ordinary held that, before the 1970s, the pursuers had acquired for the name Grant's, associated both with their business and with their products, including blended whisky, such a degree of distinctiveness as to entitle them to pursue a passing off action for its protection (223 - 224). Although the pursuers have registered trade marks covering the name Grant's in respect of whisky, they have not been able, so far at least, to register the mark in respect of all alcoholic beverages in the United Kingdom. Overseas, the position varies, of course, from country to country but the pursuers do have trade marks which they have been able to use in some countries to combat the defenders' use of the name Grant's in relation to their gin and vodka. The lack of the necessary trade mark in this country explains why the present action is based on passing off.
[8]At the time of the proof Mr. Bulloch was the chairman of both the first and second defenders. He had joined his family wine and spirits business in 1951 when it had a small wholesale operation bottling wine, gin, rum and whisky under the name Bulloch. It also bottled whisky with the name High Commissioner. In 1959 Mr. Bulloch bought William Morton Wine and Spirits Limited and this led to an expansion of the business, which entered the wholesale sector of the market, with sales to public houses, clubs and hotels. Over the 1960s Mr. Bulloch bought more retail shops and wholesale businesses in and around Glasgow. At this time the defenders sold gin and rum under the name William Morton (27 - 28).
[9]In 1972 one of Mr. Bulloch's companies acquired the whole shareholding and assets of John Grant (Wine and Food) Limited, a company which had been incorporated in 1943 in order to supply hotels, restaurants and public houses run by a pre-existing family company, Rogano Limited. Most of the outlets were in the West of Scotland. In about 1955 the family businesses were reorganised and, from then on, John Grant (Wine and Food) Limited took over the ownership and management of a number of the outlets. The company's business was the bulk buying of wines and spirits which were then bottled and labelled before being supplied either to the company's own outlets or, on a wholesale basis, to off-sales premises, licensed restaurants and public houses in and around Glasgow. When Mr. Bulloch's company acquired the business in 1972, the name Grant's and a reference to John Grant (Wine and Food) Limited appeared on the labels placed on the...
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