IN THE HIGH
COURT OF TANZANIA
(COMMERCIAL
DIVISION)
AT DAR ES
SALAAM
COMMERCIAL
CASE NO.31 OF 2004
AGRO-PROCESSING AND ALLIED PRODUCTS
LIMITED………………………………………..……….……………..….PLAINTIFF
VERSUS
SAID SALIM BHAKRESA & CO.
LIMITED………….…..…...1ST DEFENDANT
REGISTRAR OF TRADE AND SERVICES
MARKS………….2ND DEFENDANT
-----------------------
JUDGMENT
Essentially the actual controversy
between the real parties, both in the main suit and the counter claim, centers
on trade mark infringement and passing off.
The use of the word “POA” has sparked off the dispute.
The plaintiff in the main suit AGRO PROCESSING AND ALLIED PRODUCTS LIMITED
(hereinafter referred to as the plaintiff)
claims to have an exclusive rights over the word ”POA” as its trade mark
following registration of that mark with the Registrar of Trade and Service Mark
( the 2nd defendant in the
counter claim hereinafter referred to as the Registrar). The defendant in the main suit who is also
the plaintiff in the counter claim one SAID
SALIM BAKHRESA & CO. LIMITED
(hereinafter referred to as the defendant)strongly opposed the plaintiff’s
assertion. The defendant avers that the
word “POA” is not and should not be considered to be an exclusive right of the
plaintiff. In order to understand the nature
of the dispute, I think it is useful to give a short background.
The historical background giving rise to
this dispute and which most facts are not disputed is to this effect: - Both
the plaintiff and the defendant are limited liability companies incorporated in
Tanzania
It is the evidence of the defendant,
thought its General Manager one said Mohamed Said (DW1) that since their
applications were received by the Registrar, paid necessary fees and there was
no objection registered they proceeded with business in selling their
commodities inscribed with the word “POA” after advertising notwith standing
the refusal by the Registrar. This is
what he said in his evidence in chief, I quote:
“
To the best of my knowledge the application was accepted and we were asked to
pay fees for that and advertisement for that” [unders core mine]
As
regards the act of the Registrar in refusing to register the trade marks DW1
said the following in his examination in chief, I reproduce:-
“
To be honest we thought that the conduct of the Registrar was not fair, we
though that it is not proper, it was improper and that why we had written some
letters through our agency to him regarding this particular way of conduct that he had treated
us”
What
the defendant is saying is that the word “POA” is not the exclusive right of
the plaintiff.
In the main suit, the plaintiff claims
the following reliefs:-
(i)
A perpetual injection to
restrain the defendant, whether acting by its directors, officers, servants or
agents, or any of them or otherwise howsoever, from passing off the goods not the goods the goods of the
plaintiff as and for goods of the plaintiff by use of the word “POA”.
(ii)
An order for withdrawal
from the market and delivery up and destruction upon oath of the existing
package and total absention from selling or offering for sale its goods in conjunction
with the word “POA”.
(iii)
An order for deliver up and
destruction upon oath of all advertisements and displays for sale of the defendant’s
goods in conjunction with the word “POA”
(iv)
An order for the defendant
pay Tshs. 209,393,028/= as special damages.
(v)
An order for the defendant
to pay general and punitive damages for infringement, passing off and loss of
good will as I shall be assessed by the court.
(vi)
Interest at court rate per
annum on the decretal amount from the date of filing of the suit until date of
judgment and further interest to the date of full payment.
(vii)
Costs of the suit
(viii)
Any other reliefs this
court shall deem just and equitable
On
the other hand in the counter claim the defendant is claiming the following
reliefs:-
(i)
Declaration that the plaintiff
doesnot have nor entitled to exclusive right and/or use and virtual monopoly of
the word POA in the milling market in respect of wheat flour and maize flour:
(ii)
An order compelling the
Registrar to vary and/or alter the entries in the trademark register with a
view to withdrawing the monopoly the existing entries vest on the defendant
over the word POA in the milling market in respect of wheat flour and maize
flour.
(iii)
An order restraining the
plaintiff from interfering the defendant’s use of the work POA in the trade
mark SSB NGANO POA or any other mark of the defendant bearing the word POA.
(iv)
General damages as may be assessed
by the court
(v)
Costs of the suit
(vi)
Interest on costs at the
rate of 7% per annum from the date of award of the cost to the date of full
payment thereof
(vii)
Any other or further
relief(s) as the court may deem fit.
Before
commencement of the trial, the following issues were framed:
(1)
Whether or not the
plaintiff has exclusive right to the use of the word “POA” in relation to the
product and business for which the trademark is registered.
(2)
Whether the defendants
intended marks SSB Ngano POA,SSB Unga POA are nearly similar to the plaintiff’s
mark ‘POA” likely to deceive or cause confusion hence infringing the
plaintiff’s trade mark.
(3)
Whether the Registrar is
legally justified in refusing registration of the defendant intend trade mark.
(4)
To what reliefs are parties
entitled?
It
is not irrelevant at this stage to mention that the trial was conducted with
the aid of two Gentleman Assessors as provided under the Civil Procedure code,
Cap 33 as amended by GN 140/1999. The
two Gentlemen namely Mr. Muganda and Mr. Kuluchumila gave a very useful
opinions. I will discuss their opinion
while answering the framed issue. I
start with the fist issue.
It is the evidence of Sunil Nambiar
(PW1) the General Manager of the plaintiff that the trade mark “POA” in respect
of wheat flour and maize flour was duly registered with the Registrar on
5/3/2001 (Exht P1). The defendant on the
other hand through said Mohamed (DW1) and Surendra Mawji (DW2) testified to the
effect their application were accepted.
But these last witnesses did not complete the circle. They did not say whether their trade mark was
also registered.
Be that as it may, Mr Byamungu who
advocated for the plaintiff submitted that the answer for this issue lies with
the law. He submitted that sections 14(1)
and 31 of the Trade and Service Marks Act, Cap 326 (hereinafter referred to as
the Act) is very clear that one acquires exclusive right of a trade or service
mark if he registers it. And the
Registrar through Mr. Mgonja added that pursuant to S.14(2) of the Act,
registration of a trade or service mark
is only valid unless and until all conditions pertaining to registration are
fulfilled. It is their submission that
the plaintiff has the exclusive right over the word “POA”
The defendant through its advocate one
Mr. Kihwelo opposed this stand. He submitted that the word “POA” does not give
the plaintiff the exclusive right.
Like the learned counsel for the
plaintiff and Gentlemen Assessors, I entirely agree with them that the law is
very clear on this matter. The position
in law is this:- Upon registration one acquires exclusive right of a trade or
service mark. This is provided under
section 31 of the Act. The section
reads:-
31.Subject
to the provision of this Act and any limitations or conditions entered in the
registry the registration of a trade or
Service Mark shall if valid, give or be deemed to have given to the
registered proprietor the exclusive
right to the use of a trade or service mark in relation to any goods
including sale, importation and offer for sale or importation
[Emphasis mine]
Without
much ado, the answer in respect of the first issue is obvious; the plaintiff
acquired exclusive right over the trade mark ‘POA”. I now turn to the second issue.
In the first place it has been argued by
Mr. Kihwelo on behalf of the defendant that there is no evidence adduced by the
plaintiff to indicate that the use of the defendant’s intended trade marks
namely SSB Ngano POA, SSB Unga Poa and
SSB Sembe Poa will cause confusion and deceive the customers vis-a-vis- the
plaintiff trade mark “POA”. To buttress up its case the defendant discussed the
evidence of Sunil Nambiar (PW1),Jiten Chandulal Doshi (PW3) and Awadhi Kiluvya
(PW4) who are said to have testified, inter
alia that the consumers were not confused because the shape of packages, colours,
configuration, overall design and general appearance were not similar. It is the defence case that the products of
the defendant and the plaintiff are easily distinguishable in the market. This is the testimonies of Didas John (DW3),
Damas Mongi (DW),Mwasiti Mwinyi (DW5) and Ibrahim Bakari Mwanduru (DW6).
The plaintiff through Mr. Byamungu
countered the arguments. First, he said
the Registrar refused to registrar the trade mark “POA” because it will confuse
the customers. He referred to Exhts, P2
and P3.
Second,
he said even the principal witness one Said Mohamed Said (DW1) acknowledged the
dispute. As regards the defence
witnesses, he said they did not testify to what had been stated.
Mr. Mgonja on the other hand and on
behalf of the Registrar basically submitted that the refusal to register was
proper as the the trade mark in dispute resemble that of the plaintiff.
The two Gentlemen Assessors were of the
unanimous view that the registration of the defendant’s intended trade marks
will confuse the customers. They
accordingly advise me to answer this issue in the positive.
Before I go further I wish to say few
words as to the propriety of the counter claim as I see it. It is in evidence that on 27/4/2004 the
plaintiff wrote a letter to the Registrar to inquiry about the defendant’s
intended application to register its trade marks with a word ‘POA” inscribed
therein. The Registrar replied through
their letters (exht P2 and P3 (a) (b)
to the effect that registration was yet to be affected. This is because the defendant upon request
were yet to remove the word “POA” in their applications (Exht D6). The letters written by the Registrar addressed to the
plaintiff (Exht P2&P3 (a)(b) were tendered in court without any objection
and the contents were not challenged.
And as earlier observed to date the defendant are yet to be registered
as holder of the intended trade marks.
This is because of the existence of similar name used by the plaintiff.
Since the Registrar had already made a
direction then it is not proper in my view for the defendant to come to this
court with a prayer that we order the Registrar to vary and/or alter the
entries as he put it. The proper course
which the defendant ought to have taken was to object by way of an application
to the Registrar within one month
from the date of the communication of that direction so that the application to
be considered. And as the defendant
appears to have not taken any step upon receiving the Registrar’s
communication, then the entire application ought to have been treated as
withdrawn. This is provided under Rule
29 of the Trade and Services Marks Rules, Cap 326 (hereinafter referred to as
the Rules). The Rule reads:-
29.
If the Registrar is willing to accept
the application subject to any conditions, amendments, disclaimer,
modifications or limitation he shall communicate such willingness to the
applicant in wring, and, if the applicant objects to such conditions,
amendments disclaimer, modifications of limitation, he shall, within one month from the
date of the communication, apply for a hearing or communicate his
considered objections in writing, and if he does not do so he shall be deemed
to have withdrawn his application. If
the applicant doesnot object to such conditions, amendments, disclaimer,
modifications or limitations he shall forthwith notify the Registrar in writing
and alter his application accordingly.
As
already pointed out, the Registrar through his letters (Exht D6) of 30/7/2001
directed the defendant to disclaim the word “POA”. To date a period of more than 7 years the
defendant had not complied with that direction.
The application deserved to be withdrawn.
Assuming that the matter is proper
before the court, are the defendant’s intended trade marks nearly similar with
the plaintiff trade mark likely to deceive or cause confusion to the
customers.
It is not in dispute that both the
plaintiff and defendant among other businesses, carry on similar business of
maize flour and wheat flour. It is in
evidence on record that the targeted group are ordinary people who take in
small amount for buns,chapatti and “ugali”.
It is the evidence of Awadh Kiluya (PW4) that he used to buy ngano poa a
product prepared by Mohamed Enterprises.
(the plaintiff) and sale to
customers. He was emphatic that his customers requested ngano
poa. Later however, he changed to the defendant as his supplier one Shahoza
bought the product from the defendant who had an agent in Tanga. Mohamed Enterprises (the plaintiff) had none.
So one has to travel to Dar es Salaam
Didas John (DW3) a retailer and
wholesaler when asked by Mr. Byamungu the following question, he relied in the
affirmative Mr. Byamungu: It is your evidence that as the matter stand
today the
buyer are confused that they cannot get the right
product because of the similarity of the product?
Mr. Didas:
Yes.
In
re Pianotist co’s Application (1906) 23
R.P.C.774 cited in Appenteng Mersah
2 Co.Vs. Alpro Ltd High Court of Ghana, Parker;J. observed, inter alia, I quote:-
“You
must consider the nature and kind of customer who would be likely to buy those
goods”.
It is not Didas (DW3) alone who gave us the
true picture as to what is taking place on the ground but Awadh Kiluya (PW4)
also did the same. When asked by one
assessor, he said, I quote:-
“The
consumers or the retailers were not able to distinguish between the product of
the plaintiff and that of the defendant”
From
above it is clear that the word ‘POA” is used in relation to the same business
the plaintiff and the defendant are carrying.
The story could be different if say the word poa is used in relation to
a soft drink. So, here the word “POA” is
a catch word. That is the word “POA” is
an essential feature to the business of selling the plaintiff’s products.
In
Saville Perfumery Co. Ltd V June Perfect Ltd and another (1991)58 R.P.C. 147,
H.C it was held by the House of Londs thus, I quote:-
“
If the essential feature of a mark has been adopted additional words or devices
do not enable the defendants to escape liability for infringent”
And
back home in CPC International Inc. V
Zainab Grain Mollers Ltd Civil Appeal No. 49/1995 (CA) (unreported), the court of Appeal of Tanzania, held:-
“
It is settled principle that in matters of passing off, a prima facie case
could well be shown if upon consideration of the close similarity between the
trade marks complained was on balance such as to cause deception or confusion
on the part of the customers”
From
above it is clear that the defendant’s intended trade marks are similar to the
plaintiff’s mark as a result it causes confusion.
Since
the defendant adopted that trade mark it infringes the rights of the
plaintiff. I entirely agree with both
Gentlemen Assessors,. The defendant
committed the tort of passing off.
Turning to the fourth issue, the answer
is clear. The Registrar as already
pointed out was right in refusing to register the defendant’s intended trade
mark. This is because the intended trade
mark is similar with that of the plaintiff.
Having
found out that the defendant have
committed the tort of passing off, naturally the plaintiff is entitled to
reliefs. The difficult part of the
reliefs sought is that of special, punitive and general damages. I say so because it is very difficult to say
with any decree of accuracy how much the plaintiff is entitled. But all the same the exercise must be done. I start with special damages.
It is now settled that in order to
succeed for a claim under special damages, the
claimant must show that he really suffered the amount claimed. In our case, the plaintiff are claiming Tshs.
202,393,028/=.
It is the evidence of Jiten Chandulal
Doshi (PW3) the Marketing Executive of the plaintiff that from 2003 the sale of
their products namely ngano poa and maize poa dropped drastically. On making a follow up they realized that it
was owing to the defendant who use similar trade mark. They hired Shebrila & Co. Certified
public accountants, to do the auditing.
The report (Exht P5&P6) shows between 1st March, 2003 to
30th March,2004 the company suffered loss of profit of
Tshs.175,357,674/=. From 1st
April, 2004 to 24th June, 2004 the plaintiff is claiming
Tsh.270,202,393,038 – 175,357,624 = 27,035,414.
I have carefully gone
through the reports, I am satisfied that that figure is reasonable. I accordingly award the plaintiff Tsh.
202,393,038/= as special damages.
As regard both general and punitive
damages, it has been left to the court to decide. The plaintiff had just started selling their
products with the trade mark “POA” after incurring advertisement expenses. Further, the defendant did not stop using
that trade mark even after they were told not to do so. I think the plaintiff deserves the two aforementioned damages. I award as follows:
(i)
general damages Tsh.
50,000,000/=
(ii)
Punitive damages so as to
be a lesson to the defendant and alike, Tsh.80,000,000/=.
Since
the defendant to date are still using that trade mark, naturally, the plaintiff
is continuing getting loss of profits from April, 2004 to 15th
December, 2008.
I
think Tsh. 400,000,000/= is reasonable for that period an average of Tsh.100,
000,000/= a year.
From the a foregoing, the counter-claim
filed by the defendant has no leg to stand.
It is dismissed. All in all
judgment is entered as prayed in the plaint as per item (i),(ii),(iii),iv, and
vi. As regards item (v) the plaintiff is
awarded
(a)
General damages Ts.
50,000,000/=.
(b)
Punitive damages Tsh.80,
000,000/=.
The
amount of Tsh. 400,000,000/= falls under any other relief.
The
plaintiff is also entitled to their costs.
Order accordingly.
B.M. LUANDA
JUDGE
15/12/2008
Order: The
Registrar of the Commercial Division of the High Court is ordered to deliver
this judgment to the parties on an earlier convenient date.
B.M. LUANDA
JUDGE
15/12/2008
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