Mcdonald's Corporation v Mcdonald's Corporation Ltd et Al
| Jurisdiction | Jamaica |
| Judge | Rattray, P.,Downer, J.A.,Gordon, J.A |
| Judgment Date | 20 December 1996 |
| Neutral Citation | JM 1996 CA 50 |
| Docket Number | No. 69 of 1996 |
| Court | Court of Appeal (Jamaica) |
| Date | 20 December 1996 |
Court of Appeal
Rattray, P. Downer, J.A. Gordon, J.A.
No. 69 of 1996
R.N.A. Henriques Q.C. and Allan S. Wood, instructed by Mrs. AnnMarie Feanny of Livingston, Alexander and Levy for the appellant.
Michael Hylton Q.C., Peter Goldson and Mrs. Debbie Eraser, instructed by Myers, Fletcher and Gordon for the respondents.
Tort - Passing-off — Interlocutory injunction — Appellant filed against the respondent claiming that the respondent had passed off or attempted to pass off the respondent's business and restaurant as being the business of the appellant — Trial judge refused an application by the appellant for an interlocutory injunction restraining the defendants from “using upon any sign, banner, advertisements or other article the appellant's name — Trial judge ordered an interlocutory injunction by the respondent that the appellant be restrained from opening restaurant in the Corporate area trading under the name “McDonald's” pending the hearing of the action filed — Whether the appellant must have maintained a place of business in the jurisdiction before it could sustain a passing off action — What was the status of the Trade Marks registered by the appellant in Jamaica since 1969 — Finding that the appeal was dismissed as it related to the refusal of the trial judge of the appellant's application for an interlocutory injunction — Appeal was allowed in respect of the grant by the trial judge of an injunction to the respondents to restrain the appellant.
On the 7th July 1996, Chester Orr, J. refused an application by the appellant McDonald's Corporation for an interlocutory injunction restraining the defendants McDonald's Corporation Limited and Vincent Chang from “using upon any sign, banner, advertisement or other article the name McDonald's or McDonald's Corporation or “McD” or any imitation thereof whether at the defendant's store at 1 Cargill Avenue, Kingston 10, in the parish of St. Andrew in connection with any other business, or from passing off or attempting to pass off any business carried on by the defendants or any of them as the business of the plaintiff or doing any act to infringe the plaintiff's trade mark”, pending the hearing of the action filed by the appellant in this matter. In the same judgment the learned trial judge ordered on an application for an interlocutory injunction by the respondent that the appellant be restrained from opening a restaurant in the Corporate Area (as defined in the Kingston and St. Andrew Corporation Act) trading under the name “McDonald's” pending the hearing of the action filed.
The application for the interlocutory injunction arose out of a suit filed by the appellant against the respondent in which the appellant claimed that the respondent had since January 1995 passed off or attempted to pass off the respondent's business and restaurant at 1 Cargill Avenue, Kingston 10 as being the business of the appellant. Furthermore it was claimed the respondent had infringed the registered trade marks of the appellant by using a colourable imitation of the plaintiff's arched “M” corporate logo on the respondent's sign displayed at 1 Cargill Avenue, Kingston 10. Consequently, the appellant asked the court for an injunction to restrain the defendant from:
- the doing of acts infringing the appellant's trade mark registered in Jamaica; 2. passing off the business as that of the appellant; 3. using the names McDonald's Corporation, McDonald's or McD in a false or misleading respect contrary to the provisions of the Fair Competition Act; 4. carrying on business at 1 Cargill Avenue or in any other restaurant under the names of McDonald's, McD or McDonald's Corporation.
The respondent counterclaimed for an injunction restraining the appellant from opening any restaurant in the Corporate Area trading under the name McDonald's.
The interlocutory injunctions sought by both parties are designed to impose the restraints sought by either party until the trial of the action.
This appeal seeks to overturn the order of Chester Orr, J. refusing the appellant's application for the interlocutory injunction sought, as well as, his order granting the respondents interlocutory injunction.
The judgment of Chester Orr, J. sufficiently states the facts so as not to require me to restate them. He found that there were serious issues to be tried in respect of both claim and counterclaim. He identified these issues inter alia to include:
-
(a) the reconciliation or determination of two opposing lines of authority as to whether a place of business is necessary in the jurisdiction before the appellant can maintain a passing off action;
-
(i) the appellant has goodwill and customers in Jamaica;
-
(ii) the appellant is precluded from relief because of delay and acquiescence;
-
(iii) the respondent had “pirated” the name McDonald's and therefore cannot acquire the right to use that name;
-
(iv) on the evidence the respondent had abandoned whatever goodwill it had acquired when the restaurant at Cargill Avenue was closed in the 1980's.
-
All these required a determination on facts to be established on evidence given at the trial. In the words of Chester Orr, J.:
“In my opinion a decision on this aspect of the case will depend on a resolution of the competing claims to the use of the name “McDonald's” at the time of the opening of the respective restaurants in 1995. The previous history and relationship between the parties are relevant to this exercise. Such a resolution cannot be undertaken in these proceedings.”
With respect to the claim under the rubric of infringement of trade marks the trial judge noted the need to determine whether there is any similarity between the “M” in McDonald's of the appellant and those used by the respondent in its name. “From the foregoing” he maintained: “It is clear that there are serious issues to be tried.”
Since damages are not regarded as an adequate remedy in this type of action the learned trial judge identified the question arising at this interlocutory stage as one of the balance of convenience. He found that the balance lay in preserving the status quo until the trial. “This”, he said: “will be achieved by the refusal of the application for an injunction by the plaintiff and the grant of the defendants' application for an Injunction in terms of their summons.”
It is this decision of the learned trial judge that I have to examine closely to determine the correctness of the exercise of his discretion. He placed on one side of the scale the appellant's position as follows:
“The plaintiff urged the loss of employment and investment in the Corporate Area which would not be compensatable as a factor in its favour. Further, the second defendant, the proprietor of the first defendant has two other successful chains of restaurants, namely Tastees and Twisters. It would be possible for the defendants to alter the signs at No. 1 Cargill Avenue.”
On the other side of the scale:
“The defendants contended that the plaintiff had been warned of intended action by the first defendant's attorneys if it proceeded to open the restaurant. Further the plaintiff if not restrained, had the resources to destroy the first defendant's goodwill and business”.
There are in my view certain other elements to be considered in respect of the appellant to determine the proper balance which do not appear to have been taken into account:
- The fact that in Montego Bay the appellant had opened and carried on a restaurant business without any objection from the respondents. 2. The construction of the building in the Corporate Area at Molynes Road to be used as a restaurant by the appellant and the training and employment of staff which had already taken place. 3. The status of the appellant as a holder of registered trade marks which confer rights to carry on a business using the trade name.
With respect to (3) there was a disclaimer on the trade marks the effect of which can be determined as a matter of law in these proceedings. The respondent had embarked upon an application to expunge the appellant's trade marks.
In American Cyanamid Co v. Ethicon Ltd. [1975] 1 All E.R. 504 which was a patent case and therefore of the same nature as a trade mark case, a feature of the instant appeal, Lord Diplock stated as follows at p.508:
“Historically there was undoubtedly a time when in an action for infringement of a patent that was not already well established, whatever that may have meant, an interlocutory injunction to restrain infringement would not be granted if counsel for the defendant stated that it was intended to attack the validity of the patent.
Relics of this reluctance to enforce a monopoly that was challenged, even though the alleged grounds of invalidity were weak, are to be found in the judgment of Scrutton, L.J. as late as 1924 in Smith v. Grigg Ltd., but the elaborate procedure for the examination of patent specifications by expert examiners before a patent is granted, the opportunity for opposition at that stage and the provisions for appeal to the Patent Appeal Tribunal in the person of a patent judge of the High Court, make the grant of a patent nowadays a good prima facie reason, in the true sense of that terms, for supposing the patent to be valid, and have rendered obsolete the former rule of the practice as respects interlocutory injunctions in infringement actions. In my view the grant of interlocutory injunctions in actions for infringement of patents is governed by the same principles as in other actions.”
The reference to patents can with justification be equally applied to the appellant's trade marks.
The learned law Lord then went on to state the object of the interlocutory injunction at p.509 as being:
“… to protect the plaintiff...
To continue reading
Request your trial