GEORGE PAYNE & CO., (CEYLON) LTD. INTERNATIONAL EXPORTS (PVT) LTD

029-SLLR-SLLR-1998-1-GEORGE-PAYNE-CO.-CEYLON-LTD.-INTERNATIONAL-EXPORTS-PVT-LTD.pdf


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Sri Lanka Law Reports
(1998) 1 Sri LR.
GEORGE PAYNE & CO., (CEYLON) LTD.
v.INTERNATIONAL EXPORTS (PVT) LTD.
SUPREME COURT
P. S. DE SILVA, CJ„
PERERA, J. AND
SHIRANI BANDARANAYAKE, J.
S.C. APPEAL NO. 35/97
C. (CIVIL) NO. 9/96 (3)
D.C. COLOMBO NO. 4666/SPL
JULY 3RD, 4TH, OCTOBER 22ND, 24TH, 1997.
Intellectual property – Infringement of trade marks – Unfair competition – Codeof Intellectual Property Act, No. 52 of 1979 – Sections 117, 142 and 179 of theCode – Continuation of wrongs after decree – ‘Merger in judgment" of subsequentacts.
In consequence of the defendant exporting tea in circumstances which constitutedan infringement of the plaintiffs trade marks, the plaintiff obtained a permanentinjunction against the defendant in 1993, in the District Court, Colombo. In 1996the plaintiff found that the defendant was shipping tea in continued violation ofthe plaintiffs rights; whereupon, the plaintiff filed the present action pleading twocauses of action (1) infringement of trade marks in breach of rights under section117 of the Code of Intellectual Property Act, No. 52 of 1979 (2) unfair competitionbased on section 142 of the Code.
Held:
The subsequent acts of infringement and unfair competition did not have anindependent existence. They were ’merged" in the decree in the previous actionand did not in law give rise to fresh causes of action. The acts which the plaintiffcontended to constitute "fresh causes of action" fell directly within the prohibitioncontained in the permanent injunction in the previous action.
SC George Payne & Co.. (Ceylon) Ltd. v. International Exports (Pvt) Ltd.
(G. P. S. de Silva, CJ.)251
Cases referred to:
(1) Paris v. Florence (1987) 1 Sri LR 141, 147.
APPEAL from the judgment of the High Court, Colombo.
K. Kanag-lsvaran, PC with A A M. Illiyas, M. A Sumanthiran and Ms. DilmoniWijeyawardena for the plaintiff-appellant.
S. L Gunasekera with Kushan de Alwis for the defendant-respondent
Cur. adv. vult
March 03, 1998.
G. P. S. DE SILVA, CJ.
The plaintiff and the defendant are engaged in the export of tea andare both competitors in the tea trade. The plaintiff is the registeredowner of 3 trade marks and device which consist of thewords, “AL-WAZAH TEA“ (Swan brand) together with the device ofthe Swan and also the word "CHAI AL-WAZAH" in Arabic. True copiesof the certificates of registration issued in terms of section 174 of theCode of Intellectual Property Act (Code) depicting the three trademarks are annexed to the plaint marked X1, X2 and X3.
In June, 1996, the plaintiff became aware that the defendant wasshipping tea in infringement of the plaintiffs trade marks to the samedestination as the plaintiff. The export of tea was also an act of unfaircompetition within the meaning of section 142 of the Code as thecartons were similar to those of the plaintiff and were calculated todeceive the public. In its plaint the plaintiff sought, inter alia, "an interiminjunction restraining the defendant by itself and by its servants andagents and/or otherwise howsoever from using or continuing to usein any manner whatsoever or howsoever the get-up shown in thespecimen cartons annexed to the plaint marked X14 (a) and X14 (b)or any colourable imitation of the plaintiffs specimen cartons annexedto the plaint marked X15 (a) and X15 (b) and/or the trade marks X1,X2, and X3 in respect of the defendant's product, namely, tea, orany other similar goods until the final determination of this action".The learned Judge of the High Court refused the application for aninterim injunction. Hence the present appeal by the plaintiff againstthis order.
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Admittedly, the plaintiff had instituted a previous action against thesame defendant jn February, 1993, in the District Court of Colombo(case No. 3671/Spl) and had obtained a permanent injunction. Thedecree in that case dated 17th February, 1993 (X12) is in the followingterms:
nlt is ordered and decreed of consent that the defendant isrestrained by itself and/or by its servants and/or agents and/orotherwise howsoever, from using or continuing to use in anymanner whatsoever the get-up shown in the specimen cartonannexed to the plaint marked X8 or any colourable imitation ofthe plaintiffs specimen cartons marked X5 (a), X5 (b), and X5 (c)and/or trade marks X1, X2 and X3 and in respect of the defendant'sproduct, namely, tea or any other similar goods." (emphasis added).
It is correct, as submitted by Mr. Kanag-lsvaran for the plaintiff-appellant that two causes of action have been pleaded in the presentaction. The 1st cause of actiqn is based on section 117 of the Code.It is averred ip paragraph 13 (b) of the plaint “that the use by thedefendant of the said mark 'Alsaqr tea' and the aforesaid devicedepicted in X14 (a) and X14 (b) without the consent of the plaintiffis an infringement of the rights of the plaintiff granted under section117 of the Code in respect of the registered trade marks of the plaintiffdepicted in X1 to X3 . . By reason of the infringement of theregistered trade marks, the plaintiff claims a statutory right to aninjunction in terms of section 179 of the Code. (Paragraph 13 (c) ofthe plaint). The 2nd cause of action is based on section 142 of theCode. Section 142 (1) enacts that "any act of competition contraryto honest practices in industrial or commercial matters shall constitutean act of unfair competition". The second cause of action is pleadedin paragraphs 17,18 and 19 of the plaint. The plaintiff seeks an interiminjunction to restrain the defendant from using or continuing to use"the get-up shown in the specimens annexed hereto marked X14 (a)and X14 (b) or any colourable imitation of the plaintiffs specimencartons marked X15 (a) and X15 (b) in respect of the defendant'sproduct, namely, tea . . .". (Paragraph 18 of the plaint).
Mr. Kanag-lsvaran for the plaintiff-appellant strenuously contendedbefore us that in refusing the interim injunction, the learned Judgeof the High Court totally failed to appreciate the crucial fact that the1st and 2nd causes of action were not founded on the consent decree
SC George Payne & Co., (Ceylon) Ltd. v. International Exports (Pvt) Ltd.
(G. P. S. de Silva, CJ.)253
in the previous action 3671/Spl (X12), but on fresh acts of infringementand fresh acts of unfair competition, "being continuing infringementsand acts of unfair competition giving rise to new causes of action'.(to use counsel's own words).
It is true that the "acts of infringement" and the "acts of unfaircompetition" complained of in the present action occurred about3 1/2 years subsequent to the previous action. However, it is veryrelevant to note that the plaintiff does not dispute the fact that thecartons X14 (a) and X14 (b) are more or less a reproduction of thecarton X8 which was the subject matter of the previous action. Inthe written submissions dated 15.8.96 the plaintiff states: "The get-up inclusive of the colour scheme and all other essential material whichappear on the present impugned cartons, X14 (a) and X14 (b) areidentical to that of the previous carton X8 and also identical to theplaintiffs cartons X5 (a), X5 (b), X15 (a) and X15 (b) in violation ofthe plaintiffs three registered trade marks X1 to X3". (Para.2.6 of thewritten submissions). The plaintiff goes on to state: "The use by thedefendant of the present cartons X14 (a) and X14 (b) is without aniota of doubt, a reproduction of its earlier carton X8 except with thereplacement of a peacock with that of a bird's head and the replace-ment of the name "AITAOOS TEA" with that of "ALSAQR TEA". Theget-up/colour scheme/trade dress is identical" (paragraph 4.2 of thewritten submissions). Besides, in its letters addressed to the defendantthrough its registered attorneys-at-law just before the institution of thepresent action it has stated, inter alia: “you have now violated thepermanent injunction which is a decree of court and thus your company,its directors, officers and servants are guilty of contempt of courtthereby making all your Directors and officers liable for suchcontempt". X13 (a) (Emphasis added). The letter X13 (c) is in similarterms: "We reiterate that your client has violated the permanentinjunction".
On a consideration of the matters set out above, it seems to methat the "acts of infringement" and the "acts of unfair competition"complained of in the present action, though in point of time subsequentto the decree (X12) entered in the previous action, do not in law giverise to fresh causes of action as contended for by Mr. Kanag-lsvaran.The reason is that the subsequent “acts" are merged in the permanentinjunction (X12) granted in favour of the plaintiff in the previous action.In my view the resulting position is one of "merger in judgment". The
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subsequent “acts of infringements" and of "unfair competition" do nothave an independent existence; they are "merged" in the decree X12and do not in law give rise to fresh causes of action. This principleis based on the maxim "Interest reipubUcae ut sit finis litiunf. (Seealso the judgment of S. B. Goonewardena, J. in Paris v. Florencei’KAs pointed out earlier, the previous decree (X12) restrains the de-fendant from using or continuing to use in any manner whatsoever"the get-up shown in the carton P8 or any colourable imitation ofthe plaintiffs specimen cartons X5 (a), X5 (b) and X5 (c) and thetrade marks X1, X2 and X3“. The "acts" which the plaintiff contendsconstitute “fresh causes of action" fall directly within the prohibitioncontained in the permanent injunction X12.
Moreover, the ultimate relief which the plaintiff seeks in the presentaction is a permanent injunction in order to protect the legal rightsclaimed in the plaint. The plaintiff already has this protection by virtueof the permanent injunction granted in the previous action, as rightlysubmitted by Mr. S. L. Gunasekera for the defendant-respondent. Acourt does not act in vain and so the application for an interiminjunction cannot succeed.
For the reasons I have endeavoured to set out above, the appealfails and is dismissed, but, in all the circumstances, without costs.
PERERA, J. – I agree.
BANDARANAYAKE, J. – I agree.
Appeal dismissed.