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England and Wales Court of Appeal (Civil Division) Decisions

You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Anheuser Busch Inc. v Budejovicky Budvar N.P. [2000] EWCA Civ 30 (7 February 2000)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/2000/30.html
Cite as: [2000] EWCA Civ 30
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Case No: CHANF/1998/0733/4/A3

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
CHANCERY DIVISION
Mr. Justice Rimer
Royal Courts of Justice
Strand, London, WC2A 2LL
Monday, 7 February 2000

B e f o r e :
LORD JUSTICE PETER GIBSON
LORD JUSTICE JUDGE
and
MR JUSTICE FERRIS

ANHEUSER BUSCH INC.

Appellant


- and -



BUDEJOVICKY BUDVAR N.P.

Respondent



(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 180 Fleet Street
London EC4A 2HD
Tel No: 0171 421 4040, Fax No: 0171 831 8838
Official Shorthand Writers to the Court)
Mr. Geoffrey Hobbs Q.C. (instructed by Messrs. Norton Rose of London for the Appellants)
Mr. David Kitchin Q.C. and Mr. James Mellor (instructed by Messrs. Olswang of London for the Respondents)
Judgment
As Approved by the Court
Crown Copyright ©


Monday, 7 February 2000

JUDGMENT

LORD JUSTICE PETER GIBSON:
1. This dispute is the third round of the continuing conflict in the English courts between the American brewer, Anheuser-Busch Inc. ("AB"), and the Czech brewer, Budejovicky Budvar N.P. ("BB"), over the use and registration of the mark BUDWEISER and related marks in relation to beer.
2. The mark is derived from the name of the town in Bohemia which was known, when the town was part of the Austro-Hungarian empire, by its German name Budweis but which is now called by its Czech name Ceske Budejovice in the Czech Republic. For hundreds of years beer has been brewed there. BB is the successor of a brewing enterprise established in 1895. Its brewery is in the town. AB established its brewing business in Missouri during the 19th century. In 1875 it adopted Budweiser as the trade name under which it sold its beer in the U.S.A. In so doing AB was inspired by the method of brewing adopted in Budweis, but its use of the name is simply as a trade mark with no signification of the geographical origin of the product.
3. In 1919 BB and another brewery in Budweis which exported beer to the U.S.A. objected to the registration in the U.S.A. of the BUDWEISER trademark, that objection being based on a claim that the Budweiser name signified a geographical origin. That dispute led to a compromise agreement by which BB acknowledged AB's right to use the mark in connection with its beers in the U.S.A. and all other extra-European countries while AB acknowledged BB's right to use the word Budweiser whether in Europe or in North America and other extra-European countries as descriptive of the geographical origin of beer brewed by it at Budweis. Neither that agreement nor a further agreement made in 1939 by AB and BB specified that either was entitled to use BUDWEISER as a trade mark in the U.K.
4. Prior to 1919 BB had used the word Budweiser as descriptive of its beer's geographical origin but not as a trade name, the beer being marketed under trade names one of which was Budvar. That is a combination of the first three letters of Budweis (or Budejovice) and "var," the Czech word for "brew". Between 1920 and 1960 the labelling concentrated generally on the trade name, Budvar. In 1960 BB registered BUDWEISER as an international mark in Europe, and that word was then incorporated from 1960 to 1970 into export labels printed in German, French and English. In some the prominent word remained Budvar, but in others prominence was given to Budweiser, with Budvar in smaller lettering. Save only for two labels in German, the two words were used in combination. In 1967 BB effected various registrations as appellations d'origine with the International Bureau for the protection of intellectual property, including Budweiser Bier and Budweis Beer.
5. After 1967 beer with labelling giving prominence to Budweiser (with Budvar in smaller lettering) was consigned to (amongst other countries) Great Britain. The label stated in English that the beer "was brewed and bottled by the Budweiser Budvar Brewery, Ceske Budejovice, Czechoslovakia". BB obtained its designation Budweiser Budvar in 1967. No serious attempt was made by BB to export its beer to the U.K. prior to 1969 (save for a small quantity in 1959). BB had registered the name BUDVAR as a trade mark for beer, ale and porter and in 1962 had registered BUDWEISER BUDBRÄU but disclaiming any exclusivity in the use of the word BUDWEISER. In 1971 the mark BUDWEISER BUDVAR was registered, again with a similar disclaimer. Prior to 1973 no significant quantity of BB's beer was sold in the U.K. and BB had no significant reputation here.
6. From 1973, when sales were only worth £4,000, BB's sales here increased steadily. By midsummer 1979 BB had sold in excess of 1,000,000 bottles. From 1974 the retailers, Oddbins, stocked and sold BB's beer, listing it in their published price lists simply as Budweiser.
7. AB made no sales of its Budweiser beer in the United Kingdom otherwise than in the U.S. Embassy and PX stores catering not for the general public but for American service personnel between 1945 and 1973. From 1974 to 1979 there were small sales to the general public not exceeding in total 240,000 cans or bottles. Sales of AB's beer to American servicemen were, however, substantial between 1962 and 1973, varying from 3,600,000 cans to 6,000,000 cans a year. Further Budweiser as a name associated with AB's beer became well-known to a substantial number of people in the U.K. as a result of visits to the U.S.A. and of advertisements in films and American magazines circulating here.
8. On 1 August 1979 AB commenced proceedings ("the passing off action") against BB, seeking an injunction to prevent BB from selling or dealing in any beer not being AB's beer by the name Budweiser or Bud and from passing off in any other manner. BB counterclaimed for similar relief against AB. Whitford J., in a decision reported under the name Anheuser-Busch v Budejovicky Budvar [1984] F.S.R. 413, dismissed both the claim and the counterclaim. He held that neither AB nor BB was disentitled to use the name Budweiser since in 1979 there was a dual reputation and neither had achieved the reputation improperly and neither was making a misrepresentation. He recognised that some degree of confusion might result, but he said that this was true in the case of marks used in pursuance of registration under s. 12 (2) of the Trade Marks Act 1938 ("the Act"). By that provision, he said, Parliament had recognised that circumstances might arise in which two different persons ought to be entitled to use one and the same mark in respect of the same goods. He regarded Bud as the inevitable abbreviation of the name Budweiser. AB, but not BB, appealed, but this court dismissed the appeal. It accepted that there was substantial evidence of the name Budweiser as associated with AB's beer, and said that there was ample and unchallenged evidence of BB's beer being confused with AB's beer with ample evidence that in the minds of several people the two were in some way connected. This court held that the critical time was when BB first entered the English market in a not negligible way in 1973/4 by which time AB had a reputation with a substantial number of people in this country as the brewer of its Budweiser beer. But it reasoned that because this reputation did not constitute goodwill, there being no sales to the general public and no business in England by then, AB could not succeed in the passing off action. This court confirmed that both AB and BB were entitled to use the name Budweiser in this country.
9. The second round of litigation ("the Bud action") between the parties was triggered by BB applying in 1979 to register BUD as a trade mark in class 32 for beer. This was opposed under s. 11 of the Act by AB. The Assistant Registrar, Mr. Myall, held that the application was properly registrable under s. 12 (2) and that the opposition failed. On appeal Walton J. agreed (see BUD Trade Mark [1988] R.P.C. 535). He referred to the evidence as showing that the use of Bud as a contraction for Budweiser was how drinkers of AB's or BB's beer demanded the beer they wanted. He held that s. 11 did not apply because
"[w]hat would be the equity in refusing a person registration of a contraction of his proper trade mark, which cannot be complained of at all, which his customers are invariably, as the evidence runs, going to use. Of course precisely and exactly the same applies to AB's Budweiser and the use by their customers of BUD, but I cannot think that if the substantive mark of "Budweiser" in both cases can be fairly used, there can be any question of a court of equity at any time saying: "But you cannot possibly use the way in which your customers are going to describe it." The one must, as a matter of equity and justice carry the other." He therefore agreed with Mr. Myall that the opposition failed and further that s. 12 (2) pointed in the same direction, there being honest concurrent use and the special circumstance that customers for both beers were accustomed to use the same abbreviation as an abbreviation of the real name which both were free to use as against each other. Following that decision, AB registered the same mark for its beer.
10. Four further applications for registration have occasioned this third round of litigation. Three applications were by AB, each for a registration of a mark in class 32. First, on 11 December 1979 AB applied to register the mark BUDWEISER for beer, ale and porter. Second, on 12 June 1980 AB applied to register a label mark for lager beer, that label bearing the word Budweiser as the prominent name with the words PREMIUM BEER in smaller lettering below. Third, on 22 October 1981 AB applied to register a label mark for beer, that label bearing the word Budweiser as the prominent name with the words KING OF BEERS in smaller letters below. The two label marks are reproduced in the decision of the Assistant Registrar, Mr. Harkness, which is reported (together with the judgment of Rimer J. on the appeal and cross-appeal from him) at [1998] R.P.C. 669, at p. 671. BB filed oppositions to all those applications on 3 February 1988, the basis of that opposition being that the mark was not capable of distinguishing AB's goods within the meaning of s. 10 of the Act and that BB had made continuous use of the mark BUDWEISER for many years in the U.K. The fourth application was by BB on 28 June 1989. Thereby BB applied to register the mark BUDWEISER in class 32 for "Beer, ale and porter; malt beverages; all included in Class 32; but not including any such goods for supply to, or sale in, the United States of America's Embassy and PX stores in the United Kingdom." To that AB filed its opposition on 24 August 1990.
11. The basis of AB's opposition was (a) that the use of the mark applied for by BB would be calculated to deceive or cause confusion and would be disentitled to protection in a court of justice and so registration would be contrary to s. 11, (b) that the mark so nearly resembled the marks covered by AB's three applications that it would be calculated to deceive or cause confusion and so registration would be contrary to s. 12, and (c) BB had not used and did not have the requisite intention to use the mark BUDWEISER alone and so the application was not properly made under the provisions of ss. 17 and 68 of the Act.
12. The litigation made surprisingly slow progress: it was not until 30 July 1997 that Mr. Harkness gave his determination on the four applications. By then the Act had been repealed and replaced by the Trade Marks Act 1994. But it has at all times been common ground that these proceedings, having begun under the provisions of the Act, must continue to be dealt with under the Act.
13. In his decision Mr. Harkness observed that almost all the evidence filed in the proceedings before him was before the court in the earlier proceedings and had mostly been considered in some depth during those proceedings. He said that the additional evidence to a large extent merely repeated or embellished the earlier evidence. That additional evidence showed that both AB and BB had since 1979 continued to trade on an increasing scale in the U.K., AB's trade being very substantially greater than that of BB. Thus in 1992 AB's sales totalled £53.5 million and its advertising costs £5.5 million. BB's sales that year totalled just over £5.5 million and its advertising and promotional costs £72,282. Both AB and BB put in evidence as to how their products were presented to the public both on the get up of the bottles and cans and in promotional material. The bottles and cans of AB are readily distinguishable from BB's bottles in appearance. The bottles of BB use both Budweiser and Budvar together as the name of BB's beer.
14. Most of the promotional material produced by BB also refers to Budweiser Budvar. But there are three examples of such material referring to BB's beer as Budweiser alone. In one leaflet dating from 1984-5 Courage Ltd., which has distributed BB's beer since 1984, showed a rondel containing the word Budweiser alone. In another leaflet supplied by BB Supply Centre Ltd., through which until the end of 1991 the U.K. importer of BB's beer sold the beer and which has since the beginning of 1992 been the sole U.K. importer of BB's beer, Budweiser alone appears as the heading with "INTRODUCING BUDWEISER LAGER" as the subheading, and there are two further references to "Budweiser Lager". However the leaflet also portrays a bottle with BB's Budweiser Budvar label on it. In a CAMRA beer festival brochure BB's beer is referred to as Budweiser alone. There was also a good deal of evidence that those in the beer trade as well as members of the public refer to BB's beer as Budweiser or Czech Budweiser or Bud or Czech Bud. Thus Lynne Zilkha of BB Supply Centre Ltd. said:
"The entire beer trade in the U.K. usually refers to beer which is produced by [BB] as "BUDWEISER" or "CZECH BUDWEISER" without using "BUDVAR". This applies to both written and verbal references and to wholesalers and retailers as well as to members of the public."
Whilst evidence like that can be criticised for being unspecific, no cross-examination of those giving such evidence was ever sought. Mr. Harkness found nothing in the decisions in the passing off action and the Bud action to indicate that there was any restriction of the rights of both AB and BB to use the mark BUDWEISER. He concluded that they both had rights in the mark and that in the context of s. 17 both could claim ownership. He therefore decided that both parties' marks should proceed to registration. He did not expressly deal with the objections under s. 11 or s. 12.
15. AB appealed against the decision of Mr. Harkness on BB's application. BB also appealed against his decision on AB's three applications, but made clear to Rimer J., who heard the appeals, that its primary position was that both AB's appeal and BB's appeal should be dismissed. The judge in his judgment said that he accepted that at all times since about 1973 BB had used Budweiser as a trade mark not just as part of the composite Budweiser Budvar label but also on its own. He referred to the evidence, including evidence that BB's beer is commonly referred to simply as Budweiser by those traders and customers who order it and said that the thrust of this court's decision in the passing off action was that BB was entitled to use Budweiser in relation to its beer just as was AB and that that was the basis on which Walton J. approached the Bud action. Rimer J. said that he agreed with that approach. He said that in the absence of AB there would be no difficulty in allowing BB's application, and that the only real question was whether AB had made good its objection under s. 11, and, if it had, whether that objection should be overridden under s. 12 (2). He rejected the s. 11 objection on the ground that this was a case where BB's right to use the name Budweiser concurrently with AB had been established by the decision in the passing off action. If wrong on that, he said that this was a case where there had for long been an honest concurrent use by both AB and BB of the mark Budweiser and the unusual circumstances of the case, including in particular the use by BB's traders and customers of the word Budweiser to refer to BB's beer, were sufficiently special to justify overriding under s. 12 (2) any s. 11 objection. He accordingly dismissed both AB's and BB's appeals.
16. In this court AB appeals from the dismissal of its appeal on its objection to BB's application and BB appeals from the dismissal of its appeal on its objections to AB's three applications. BB's primary contention is again that the decision to allow the applications of both AB and BB to proceed to registration is correct, and so both appeals should be dismissed. BB's alternative contention is that if AB's appeal is allowed, with the result that BB's application to register BUDWEISER is refused, then AB's applications should also be refused.
17. It is convenient at this point to refer to those provisions of the Act which are relevant to the matters in dispute and to the authorities which explain those provisions.
18. S. 10 (1) provides that in order for a trade mark to be registered it must be capable of distinguishing goods with which the proprietor of the trade mark is or may be connected in the course of trade from goods in the case of which no such connection subsists. By s. 10 (2) in determining whether a trade mark is so capable regard may be had to the extent to which the trade mark is inherently so capable and by reason of the use of the trade mark and any other circumstances the trade mark is in fact so capable. The term "trade mark" is defined in s.68 (1) as meaning (so far as is relevant) a mark used or proposed to be used in relation to goods for the purpose of indicating, or so as to indicate, a connection in the course of trade between the goods and some person having the right as proprietor to use the mark, whether with or without any indication of the identity of that person. "Mark" is expressed to include a device, brand, heading, label, ticket, name, signature, word, letter, numeral, or any combination thereof. By s. 68 (2) references in the Act to the use of a mark are to be construed as references to the use of a printed or other visual representation of the mark, and references to the use of a mark in relation to goods are to be construed as references to its use upon, or in physical or other relation to, goods.
19. S. 11 is in this form:
"It shall not be lawful to register as a trade mark or part of a trade mark any matter the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection in a court of justice, or would be contrary to law or morality, or any scandalous design."
A provision in substantially the same form was found in the earliest trade mark legislation, s. 6 Trade Marks Registration Act 1875. As Lord Diplock explained in GE Trade Mark [1973] R.P.C. 297 at pp. 325-6, to understand the words "would .... be disentitled to protection in a court of justice", one must go back to the practice of the Court of Chancery prior to the 1875 Act. He pointed out that legal recognition of trade marks as a species of incorporeal property was first accorded by the Court of Chancery in the first half of the 19th century. The following principles were established by 1875:
(1) It was unnecessary to prove any intention to deceive on the part of an infringer against whom an injunction to restrain his use of a trade mark was sought. The right of property in a trade mark was a right to restrain others from using the mark.
(2) That right was an adjunct of the goodwill of a business and incapable of separate existence dissociated from the goodwill. To be capable of being the subject matter of property a trade mark had to be distinctive, in the sense of being recognisable by a purchaser of goods to which it was affixed as indicating that they were of the same origin as other goods which bore the same mark and whose quality had engendered goodwill. Property in a trade mark could therefore only be acquired by public use of it as such by the proprietor.
(3) The principal remedy for the protection of the trade mark was the discretionary equitable remedy of an injunction to restrain infringement. The interest of the general public required that they should not be deceived by the trade mark, either as to the character of the goods to which the trade mark was attached or as to the origin of the goods. But the interest had to be accommodated within the traders' vested right of property in trade marks which they had honestly adopted and which by public use had attracted a valuable goodwill.
(4) Marks which were identical or resembled one another closely might be innocently adopted by traders in different locations and goodwill might be divided. Under the doctrine of honest concurrent use a trade mark was entitled to protection in cases where the use of it had not originally been deceptive but a risk of deception had subsequently arisen as a result of events not involving any dishonesty or wrongful conduct by the proprietor of the mark. If his own wrongful conduct had played a part in making that use of the mark deceptive, under the "clean hands" doctrine an injunction would be denied. In cases of honest concurrent user, neither of the owners of the mark could restrain the other from using it, but as against an infringer either owner could obtain an injunction.
20. There are two other features of s. 11 which I should mention. One is that the section gives the public an interest in resisting an unlawful registration. As was said by Lord Macnaghten in Re Dunn's Trade Mark (1890) 7 RPC 311 at p. 319, the section raises a matter between the applicant and the public. Accordingly any member of the public can rely on the section. The other is that the question whether the use of any matter as a trade mark would not be entitled to protection as being likely to deceive or cause confusion is a hypothetical question. Mr. Kitchin Q.C. for BB argued that once there is a pattern of trade by the parties the court looks at the actual circumstances. I do not accept that. The language of s. 11 shows plainly that the question thereby posed is hypothetical. As Lord Diplock explained in GE Trade Mark at pp. 320, 1 the question posed by the section is "a hypothetical question which first arises on an original application for registration. It looks to the future use of the matter as a trade mark and embraces any normal and fair use which as registered proprietor the applicant would be entitled to make of it in the ordinary course of trade in respect of goods of the class for which it is registered." The question whether a s. 11 objection would be overridden under s. 12(2) is a distinct question.
21. 12 (1) prohibits, subject to subs. (2), the registration of a trade mark which is identical with or nearly resembles a registered mark belonging to a different proprietor. Subs. (2) provides:
"In case of honest concurrent use, or of other special circumstances which in the opinion of the Court or the Registrar make it proper to do so, the Court or the Registrar may permit the registration by more than one proprietor in respect of -
(a) the same goods,
(b) the same description of goods, or
(c) goods and services or descriptions of goods and services which are associated with each other,
of marks that are identical or nearly resemble each other, subject to such conditions and limitations, if any, as the Court or Registrar, as the case may be, may think it right to impose."
It is not in dispute that s. 12(2) is not merely an exception to s. 12(1) but also can override a s. 11 objection. There is no doubt but that s. 12(2) does require consideration of the actual use of the mark. It confers a discretion on the Court or Registrar. How that discretion was exercised in the particular circumstances of one case was explained by Lord Tomlin in Pirie's Application (1933) 50 R.P.C. 147 at p. 159:
"In my opinion, when once the two factors, viz., the previous registration of the Appellants' mark and the Respondents' knowledge of the Appellants' mark have fallen into their right perspective, the case becomes easy of decision and should in my opinion be determined in favour of registration for the following reasons:- (1) While recognising the possibility in certain, perhaps somewhat remote, contingencies of confusion from phonetic similarity between the two words and giving due weight to the possibility of mistake arising from inaccurate or ill-remembered impression on the mind of one or other of the marks, I am of opinion that the possibility of confusion is slender. (2) The choice of the word "Abermill" was honestly made. (3) Five years' honest concurrent user has been proved. (4) It is the user and not the registration which is liable to cause confusion, and the commercial user has not produced any proof of confusion. This fact cannot be regarded as unimportant even though allowance be made for difficulty of proof; and (5) the Appellants' trade is small, and for some years has remained more or less stationary. The Respondents, on the other hand, have built up with their trade mark a large and increasing business.
Bearing these matters in mind, the hardship to the Respondents of refusing registration appears to be out of all proportion to any hardship to the Appellants or inconvenience to the public which can possibility result from granting it."
But there are dangers in seeking to apply the five reasons found determinative in Pirie as the determinative criteria in every case. As is said in Kerly's Law of Trade Marks, 12th ed. (1986), para. 10-18:
"The discretion of the tribunal is unfettered and concurrent registration may be allowed even when the probability of confusion is considerable. Every case has to be determined on its own particular merits and circumstances."
17(1) provides (so far as is relevant):
"Any person claiming to be the proprietor of a trade mark used or proposed to be used by him who is desirous of registering it must apply to the Registrar in the prescribed manner for registration...."
That provision makes clear that the trade mark user which is relevant for registration is that of the proprietor himself. By s. 17(2) the Registrar has a discretion whether to refuse the application or accept it absolutely or subject to such amendments, conditions or limitations as he might think right.
22. The final statutory provision which I should mention is s. 21(1). This provides that where the proprietor of a trade mark claims to be entitled to the exclusive use of any part thereof separately, he may apply to register the whole and any such part as separate trade marks, but each such separate trade mark must satisfy all the conditions of an independent trade mark. It must therefore satisfy the requirements of s. 10. This is exemplified by Parker Knoll Ltd. v Knoll International Ltd. [1961] R.P.C. 346. In that case the plaintiff was the registered proprietor of the trade mark Parker Knoll. This court held that the plaintiff was not entitled to register the word Knoll alone because on the evidence that word meant to a number of persons the goods of the defendant and it could not satisfy all the conditions of an independent trade mark; in particular it was not inherently capable of distinguishing the plaintiff's goods.
23. Mr. Hobbs Q.C. for AB advanced two main arguments in support of AB's appeal, the first relating to s. 11 and the second relating to s. 12.
24. He said that the judge was wrong to reject AB's objection under s. 11. He criticised the judge's reasoning under this head, based as it was on the decision of this court in the passing off action. Mr. Hobbs argued that the decision in the passing off action was not directed to, and was not determinative of, the acceptability of BB's application to register the word BUDWEISER alone under the 1938 Act. He contended that BB's application had to be judged by reference to the hypothetical question posed by s. 11 by which the court was required to consider the likelihood of deception and confusion if the applicant made any normal and fair use of the trademark sought to be registered. He drew our attention to the dictum of Oliver L.J. in the passing off case, My Kinda Town Ltd. v Soll [1983] R.P.C. 407 at p. 425, that where there is already a substantial potentiality for confusion of two businesses simply by reason of their being engaged in the same trade, a trader cannot legitimately build on and increase that potentiality in such a way that confusion becomes worse confounded. He also referred us to the decision of Stirling J. in Saunders v Sun Life Assurance Co. of Canada [1894] 1 Ch 537 in which it was held that the defendant was not entitled to use the name "The Sun" or "the Sun Life" without the addition of the words "of Canada"; this was so despite the fact that there was evidence that the additional words were naturally dropped for the sake of brevity. Mr. Hobbs described it as plain common sense that to allow BB to register BUDWEISER alone for its beer would exacerbate the confusion which this court acknowledged in the passing off action already existed with BB's Budweiser Budvar beer being confused with AB's Budweiser beer. Such registration, he said, would close the gap which has existed for many years between the branding of BB's beer and the branding of AB's beer.
25. Mr. Kitchin's riposte was that there was no gap as BB had already used BUDWEISER as a trade mark and he submitted that its use by BB would not be disentitled to protection. He accepted that it was possible to contemplate ways in which BB's beer could be marketed such that the risk of confusion with AB's beer was increased, but he pointed to s. 2 of the Act as the answer to that, providing as that section does that nothing in the Act affects the rights of any person in passing off. He said that if BB presented its product in a way which would cause deception or confusion, AB would have its remedy against BB in passing off. He supported Rimer J.'s view that the decision of this court in the passing off action establishing BB's right to use the name Budweiser concurrently with AB defeated the S. 11 objection.
26. For reasons on which I shall enlarge when I come to s. 12 (2), I accept that there has been some use by BB of BUDWEISER as a trade mark, though it is clear that BB has to a much greater extent used the composite BUDWEISER BUDVAR as a trade mark. In my judgment it is appropriate to keep separate the test posed by s. 11 and that posed by s. 12(2) and not to conflate the two. With due respect to the judge, I do not see that the decision in the passing off action is determinative of the s. 11 objection. That decision related to the private rights of the parties to the passing off action. AB's action failed because at the date of the inception of the conduct complained of, in 1973/4, AB, whilst possessing the reputation in the name Budweiser and whilst proving confusion and the risk of deception could not establish that it possessed goodwill in this country. Under s. 11 it is a matter between the applicant and the public. The position to be looked at is at the date of application (28 June 1989) and the hypothetical question to be asked is whether any normal and fair use by BB of the trade mark BUDWEISER would be likely to deceive or cause confusion and so whether the mark would be disentitled to protection. In BALI Trade Mark [1969] R.P.C. 472 at pp 496,7 Lord Upjohn said:
"It is not necessary in order to find that a mark offends against section 11 to prove that there is an actual probability of deception leading to a passing off or (I add) an infringement action. It is sufficient if the result of registration of the mark will be that a number of persons will be caused to wonder whether it might not be the case that the two products come from the same source. It is enough if the ordinary person entertains a reasonable doubt, but the court has to be satisfied not merely that there is a possibility of confusion; it must be satisfied that there is a real tangible danger of confusion if the mark which it is sought to register is put on the register."
27. A normal and fair use by BB of BUDWEISER would be to label its product Budweiser alone and to promote it as such. That is what it must be taken to have applied to do and it must be assumed that such use is intended. This is a change from the use which it has pleaded in its counter-statement:
28. "The [applicants] have used the trade mark "BUDWEISER BUDVAR" in the United Kingdom for many years in relation to their beer and in this way have already used the trade mark "BUDWEISER" on beer".
To my mind there is a real tangible danger that to drop the name Budvar from Budweiser Budvar for BB's beer would be likely to increase the existing inevitable confusion of that beer with the more widely marketed and better known beer of AB. If one leaves s. 12(2) aside, that is not something to be encouraged. I cannot accept that s. 2, merely by preserving rights to sue in passing off, can convert what is otherwise an application objectionable because of the likelihood of deception and confusion into one which cannot be defeated by s. 11. The s. 11 test must be applied regardless of s. 2. Subject to s. 12(2) therefore, in my judgment the objection under s. 11 is made out.
29. Mr. Hobbs took the further point under ss. 10 and 21 (1) against registration that BB could not show that it satisfied all the conditions for registration of an independent trade mark when BUDWEISER was widely known as the mark of AB and its beer. Indeed Mr. Kitchin took a similar point in his argument against AB's applications, relying on BB's reputation and goodwill under the BUDWEISER trade mark. I see force in that point, but it is separate from the s. 11 objection and it too must yield to s. 12 (2), expressly contemplating as it does that two traders will obtain registration of the same trade mark.
30. I come now to s. 12(2). The applicant for registration of a trade mark used by another must bring himself within either "honest concurrent use" or "special circumstances" or both. I shall consider them in turn.
31. The reason why Rimer J. held that this was a case of honest concurrent use by BB as well as by AB of the trade mark BUDWEISER was that all times since about 1973 BB had used the word Budweiser not just as part of the composite Budweiser Budvar but also on its own. He considered that the thrust of the decision of this court in the passing off action was not that BB was entitled to use the word Budweiser to describe its beer only as part of the composite Budweiser Budvar but that it was entitled to use the word Budweiser in relation to its beer just as was AB. Mr. Hobbs criticised the judge's approach. He said that the decision in the passing off action did not decide the entitlement of BB to use Budweiser's name for trade mark registration purposes, that decision producing a stalemate. He submitted that there had not been honest concurrent use by BB of the trade mark BUDWEISER alone.
32. I own to finding this a difficult point, but I am persuaded by Mr. Kitchin that there has been honest concurrent use by BB of BUDWEISER. Jiri Bocek, a director of BB, in his statutory declaration accurately stated the position when he said: "In the UK market for beer, the beer brewed by my company is sold mainly under the trade mark "BUDWEISER BUDVAR" but the trade mark "BUDWEISER" is also used and the product is known commonly as Czech BUDWEISER or Czech BUD or BUDWEISER or BUD." In my judgment in addition to the limited use by BB of BUDWEISER alone in the promotional material to which I have already referred, it is clear that the emphasis in its use of BUDWEISER BUDVAR has in general been on the first word BUDWEISER, which was always likely to be the focus of attention for traders and the public alike. There can be no doubt but that in the passing off action Whitford J. and this court treated BB as using the trade mark BUDWEISER even when the evidence showed it was used in conjunction with BUDVAR. Whitford J. ([1984] F.S.R. at p. 440) described as "the real question" whether AB could stop BB from using the word Budweiser as a trade mark. It is of significance that that judge, with his vast experience in this field, found that in their claims for passing off AB and BB were in a situation analogous to that covered by s. 12(2) (see pp. 441-2), a point also observed by the also very experienced Mr. Myall in his decision in the Bud action (see [1988] R.P.C. at p543). As Mr. Myall also said, that was not a view disputed by this court on the appeal in the passing off action. Oliver L.J. said that BB had for some time used the name Budweiser, sometimes as an indication of the geographical origin of its beer "but more recently as a trade name in its own right ([1984 F.S.R. at pp. 448,9). He referred (at p. 468) to BB in 1973 first starting to market in Great Britain under the name Budweiser and he ended his judgment (at p. 471) by agreeing with Whitford J.'s conclusion that both AB and BB were entitled to use the name Budweiser in this country. Dillon L.J. at p. 472 described AB's passing off claim as one to restrain BB from marketing its beer under the name Budweiser and spoke of BB as first starting to market its beer under that name in 1973. He too supported Whitford J.'s conclusion that there was a dual reputation in that name. O'Connor L.J. agreed with both Oliver and Dillon L.JJ.
33. There can be no doubt but that Walton J. thought that this court had decided that both AB and BB were entitled to use the name Budweiser of which both were proprietors. His decision was based on that premise. His conclusion that BB was entitled to obtain registration of the trade mark BUD as a contraction of BUDWEISER, if correct, necessarily entails that BB is also entitled to obtain registration of the unabbreviated trade mark BUDWEISER. There was no appeal by AB from that decision and Mr. Hobbs does not dispute that it is binding on AB.
34. In the light of all the circumstances I accept that there has been concurrent use by BB as well as AB of the trade mark BUDWEISER. Mr. Hobbs has made no suggestion that if there has been such use it was nevertheless not honest. On the facts any such suggestion could not be sustained. Both Whitford J. and this court in the passing off action and Walton J. in the Bud action roundly dismissed the notion that BB had acted dishonestly in such use.
35. Rimer J. also found special circumstances justifying the overriding under s. 12(2) of the s. 11 objection. They consisted of the unusual circumstances of the case, indicating in particular the use by BB's traders and customers of the word Budweiser to refer to its beer.
36. Mr. Hobbs again challenged the correctness of the judge's reasoning. He submitted that the abbreviation made by such persons, as distinct from BB itself, of the trade mark BUDWEISER BUDVAR to BUDWEISER should not be treated as significant. However he accepted that it was a circumstance which could be taken into account. In my judgment it would be wholly unrealistic not to treat as significant the fact that on the unchallenged evidence of BB its beer was known in the trade and referred to by members of the public as Budweiser alone. I agree with Walton J. in the view he expressed in the Bud action that the way customers refer to a product by a name in a trade mark sense is a relevant special circumstance. In my judgment the previous litigation between the parties and in particular the registration of BUD as a trade mark contraction of BUDWEISER is also a special circumstance. I agree, therefore, with the judge that notwithstanding the danger of confusion special circumstances justify the overriding of the s. 11 objection.

37. In follows that despite the excellence of Mr. Hobbs' arguments I would dismiss AB's appeal. Mr. Kitchin accepts that in that event BB's cross-appeal should also be dismissed and it is unnecessary to consider his alternative contention.

LORD JUSTICE JUDGE:
38. The self indulgence of narrating and commenting on the history of events in the Austro-Hungarian empire and the town known to its German speaking inhabitants as Budweis, or indeed the brewing methods originating in that area which were taken to and adopted in Missouri in the United States of America in the second half of the nineteenth century must be avoided.
39. At that time the limitations of geography, and more restricted methods of business and transport than those available to contemporaries, would have meant that very few individuals familiar with the beer brewed in either Bohemia or Missouri would have had very much idea, or interest, if any, about the beer being brewed abroad. When however the Czech brewery, which I shall describe as BB, sought to expand its sales into the United States in the early part of the last century, battle was joined.
40. The first dispute was compromised in the United States as long ago as 1911. All the relevant history, particularly in relation to the development of both businesses in the United Kingdom after World War II is fully narrated in the earlier judgment of this court ("the passing off action") brought by the American company, described hereafter as AB and reported at [1984] FSR 413. The second round in the battle (the "Bud" action) was concluded before Walton J in July 1987 ([1988] RPC 535). On his analysis of the Court of Appeal's decision, both BB and AB were entitled to use the name "Budweiser" and neither could prevent the other from doing so. In 1982 Whitford J had observed that the contraction of Budwieser to "Bud" was inevitable, and Walton J concluded that both BB and AB were to be regarded as proprietors of the trademark "Bud", if they wished. This recognised the reality that given the ease with which the word trips off the tongue, evoking, as it does, concepts of warmth and friendship similar to those found in words like "buddy", "mate" and "pal", a customer ordering Budweiser, whether in its American or Czech variety, would be likely to employ the diminutive "Bud". There was no appeal against this decision which, together with that of the Court of Appeal in the passing off action, has had practical consequences for the businesses of both companies. In other words, the decisions of the Court of Appeal and Walton J respectively, have been taken into account and their logical consequences applied by both companies when organising their marketing arrangements in the United Kingdom and their continuing competition with each other.
41. The subsequent history is brought up to date in the judgment of Peter Gibson LJ, and, again, nothing is gained by repetition.
42. The principal issue between AB and BB in the present litigation concerns the entitlement (or otherwise) of BB to register the mark "Budweiser", omitting altogether any reference to "Budvar" which until now, largely but not invariably, has been used by BB in conjunction with Budweiser, while AB has employed Budweiser, by itself, and without any further embellishment or additional words.
43. The relevant statutory provisions are set out in Peter Gibson LJ's judgment. In summary, s11 of the Trade Marks Act 1938 prohibits the registration as a trade mark of any matter "the use of which would, by reason of its being likely to deceive or cause confusion or otherwise, be disentitled to protection ... " Such registration would not be "lawful". S12(1) prohibits the registration of any trade mark "in respect of any goods or description of goods that is identical with or nearly resembles a mark belonging to a different proprietor and already on the register ...".
44. Self evidently, as a trade mark Budweiser Budvar is not identical to Budweiser. If it were, BB would not be seeking to register the word "Budweiser" on its own. Mr Hobbs QC is right when he argues that if AB had thought that some commercial advantage would follow, BB would not have taken kindly to the addition of the word "Budvar" to its product by AB. Further it seems to me likely that there is some continuing confusion between the two products, at any rate in the cases of those individuals who do not appreciate that there are differences between American Budweiser and Czech Budweiser.
45. As a matter of law the failure of AB's passing off action was not decisive of the question whether the present application fell within the statutory prohibitions against registration. The issues arising for consideration were not and are not identical. Therefore to the extent that the judge founded his decision on this proposition, and essentially for the reasons given by Peter Gibson LJ and Ferris J, I disagree with him. Therefore I need not analyse the point more closely.
46. S12(2) of the 1938 Act provides that in cases of "honest concurrent use, or ..... other special circumstances" it may be proper to permit the registration notwithstanding that marks used by two proprietors are identical, or nearly so. Such registration may be permitted where the specific condition identified in the sub section (honest concurrent use) applies, or in any other circumstance which can properly be described as "special".
47. Guidance about the basis on which this discretion should be exercised is provided by Lord Tomlin in Pirie's Application [1933] 50 RPC 147 at p159. This decision, and the criteria he identified, do not represent a reworking of the statutory provision, sufficient to cover every case where the court is considering whether to exercise its discretion in favour of registration. Given the nature of the prohibitions in s11 and s12(1) it seems to me that, normally at any rate, account should be taken of the nature and extent of the risk of confusion or deception, potentially damaging to the public generally, and where the mark has already been registered by another party, damaging to its business, and also whether the party seeking the exercise of the discretion, has, in the context of a serious competitive market, conducted its business on the issues in relation to which registration arises with reasonable integrity. I doubt whether there will be very many circumstances, or combination of circumstances, that are "so special" that the discretion would be exercised in favour of a party whose use of a mark could properly be stigmatised as dishonest. Ultimately the decision depends on all the relevant facts which arise in the individual case and the balanced exercise of the judge's discretion. Save on well known principles this court should not interfere with it.
48. In my judgment the decisive factor in this litigation is that the exercise of the judge's discretion under s12(2) cannot be impugned. It focused on the practical realities, at least in part consequent on the sensible application of the previous decisions of the Court of Appeal and Walton J. Customers for either product who genuinely appreciate that there are two products, and that they are different, and who favour the one over the other, are likely to make their orders by specifying or referring to American Bud, or Budweiser, or Czech Bud, or Budweiser. If they are ignorant of the difference, or the difference is immaterial to them, they will ask for Budweiser or Bud and be supplied with whichever product the vendor has in stock. If he happens to stock both, he may ask the customer to specify which, and may then, at any rate if business is slack, become involved in a discussion of the differing qualities of the two beers, and if in expansive mood, with a history lesson. As to the variety he may elect to stock, if he only has room for one, his preference will be for the brew which experience suggests that the majority of his customers prefer. I remain unpersuaded that any consequent problems following the registrations sought by both AB and BB would give rise to confusion or difficulty in the public mind which would be of more than minimal significance and in my judgment it is too late for anything practical now to be done, without simultaneously putting one or other product at a significant and unfair commercial disadvantage as against the other.
49. In view of the way this commercial dispute has developed, and the history already outlined in so many judgments, and the absence of any evidence to justify the conclusion that BB acted dishonestly in respect of its use of Budweiser, or in procuring its customers to use the diminutive "Bud" when ordering its beer, and balancing both the public interest, and the proper preservation of the commercial interests of each of the protagonists, these registrations should be permitted.

50. I agree that the appeals by both AB and BB should be dismissed.
MR JUSTICE FERRIS:
51. The factual basis on which Rimer J decided this case appears in a passage at the end of his judgment (see [1998] RPC 669 at pages 696-7). It reads as follows:


"I accept ... that at all times since about 1973 BB has used the word Budweiser as a trade mark not just as part of the composite Budweiser Budvar label, but also on its own. As I have said, that was precisely the assertion made against BB by AB in the passing off action. During the whole of the relevant period the word Budweiser on BB's labels has been the more prominent of the two words Budweiser Budvar. It is that word which is commonly going to be recognised and used by the customer to refer to BB's beer. It appears from the judgments in the passing off case that BB's beer was, at least by certain traders, stocked and sold simply as Budweiser (see, for example, [1984] FSR 413 at 456). There is evidence in these proceedings, albeit of a fairly modest extent, proving the continued use of the word Budweiser alone in certain advertising and promotional material relating to BB's beer. There is also evidence that the beer is commonly referred to simply as Budweiser by those traders and customers who order it, which I do not find surprising. There is, though, of course, a considerable volume of evidence showing that it is also widely advertised, sold and referred to by its full name of Budweiser Budvar. The thrust of the decision of the Court of Appeal was not, however, that BB was entitled to use the word Budweiser to describe its beer, but only as part of the composite Budweiser Budvar. It was entitled to use the word Budweiser in relation to its beer, just as was AB. That was the basis on which Walton J approached the Bud proceedings; and, if I may respectfully say so, I consider it was the right approach."
52. Before us there was a good deal of debate about whether BB itself, as distinct from its customers, can truly be said to have used the word Budweiser alone, without Budvar, to any significant extent. Unfortunately there was no cross-examination on this point in the earlier stages of the case and a degree of imprecision may have crept in as the result of the treatment as evidence in this case of material deployed in the passing-off action, when attention may not have been focused on the issue in the way it has before us. The evidence, such as it was, has been summarised by Peter Gibson LJ and I do not propose to explore it further in this judgment. I think that the Judge was right to describe it as being "of a fairly modest extent".
53. There is more evidence of the use of Budweiser alone if the usages of BB's customers are taken into account. As to this, I agree with Mr. Hobbs that this is of less significance than use by BB itself, but I do not think it falls to be left out of account altogether, because it represents an almost inevitable colloquial contraction of the full Budweiser Budvar, which is the name that BB itself normally uses.
54. The matter is not wholly straightforward, but I am content to agree with the Judge in what he said in the first part of the passage which I have quoted. What follows about the thrust of the Court of Appeal decision and the following of the approach of Walton J in the Bud case is, I think, more debatable.
55. Mr. Hobbs argued that Mr. Harkness and Rimer J had looked at the passing off action on the wrong basis. First they had failed to appreciate that the test to be applied in a passing off action is different from that which has to be applied to a trade mark objection under Section 11 of the 1938 Act. In a passing off case the issue relates to the private rights of the parties. The only interest which the court is prepared to protect is the proprietary interest of a trader in his goodwill. If the court is not satisfied that a claimant has a goodwill to protect it will not intervene at the instance of that claimant and the other issues which have to be considered in relation to a claim in passing off will not arise. In contrast to this, the issue under Section 11 is one between the applicant for registration and the public (see particularly Re Dunn's Trade Mark (1890) 7 RPC 311 at 319 and BALI Trade Mark [1969] RPC 472 at 495-496). Hence the fact that a party has failed in a passing off action against a trader who has used a particular trade name is not determinative of the question whether that trader is entitled to register the name as a trade mark. As it was put by Lord Upjohn in the BALI case (at page 496):
"The whole emphasis is upon the question whether the owner of the mark in suit, assuming him to bring some action against another trader, would be disentitled from succeeding for any of the reasons set out in section 11; not whether anyone would succeed against him. This is the chief distinction between section 11 and section 12. Section 12 is principally a weapon in the hands of a registered proprietor though it is not necessary that he personally should object."
56. Having regard to this difference it is necessary to examine exactly what was the basis on which the passing off action was decided in the Court of Appeal. As to this, it is apparent from the judgment of Oliver LJ that he considered that AB's claim in passing off had to be looked at at the time when BB first entered the English market in 1973/74. At that time AB already had significant sales of its beer to American forces in this country through their PX sales. He said that the question to be considered was
"How far is it an essential ingredient of a successful claim in passing off that the plaintiff should have established in this country a business in which his goods or services are sold to the general public on the open market?" (see [1984] FSR 413 at 462).
57. O'Connor and Dillon LJJ approached the matter in a similar way (see at pages 471 and 473 respectively). All three members of the court concluded that the suggested ingredient is an essential one. Accordingly AB's action failed because AB could not establish the existence of goodwill at the relevant time and the suffering or likelihood of suffering damage to that goodwill, these being two of the essentials for a successful passing off action as expounded in Erven Warnink BV v J. Townend & Sons (Hull) Ltd [1979] AC 731.
58. On this analysis it is, in my view, going too far to say that the thrust of the Court of Appeal decision in the passing off action was that BB "was entitled to use the word Budweiser in relation to its beer, just as was AB". The Court of Appeal did not directly decide that there was any such entitlement. What it decided was that AB could not establish the essential ingredients of a passing off action against BB. It was not suggested that BB could do so against AB. Thus neither party could complain of what the other had been doing. To elevate this into an entitlement has, I think, a potential to mislead. Certainly it cannot be said, in my view, that the Court of Appeal decision has disposed of AB's Section 11 objection to BB's application.
59. This matter must be determined by applying the tests prescribed by Section 11 itself. One can leave out of account any question of the mark applied for being contrary to law or morality or scandalous or objectionable on grounds other than a tendency to deceive or cause confusion. The question is whether the use of the mark Budweiser by BB would be disentitled to protection in a court of justice by reason of being likely to deceive or cause confusion. It is clear that this has to be approached as a hypothetical question which looks to the future use of the trade mark on the basis that BB may use the mark in any way in which a registered mark may ordinarily and fairly be used (see GE Trade Mark [1973] RPC 297 at page 320 per Lord Diplock). Hence representations on the part of BB as to how it has used the word Budweiser before registration and how it would continue to use it are not pertinent if, after registration, BB could lawfully use it differently or more extensively. What has to be considered is what BB would be entitled to do as trade mark owner if it were so minded, not what it says it intends to do.
60. The test of whether the use of a particular name or mark would cause confusion is, I think, the same in both passing off and trade mark law. In the passing off action both Whitford J and the Court of Appeal took the view that there was and would remain a degree of confusion between the products of AB and BB respectively. While there were references to a degree of commercial adjustment to this situation these do not alter the fact that at first instance and on appeal the decision proceeded on the basis that there was and would remain an underlying element of confusion resulting from the use of BB's Budweiser Budvar and AB's Budweiser. Turning to trade mark registration, it is difficult to see why BB would wish to register Budweiser alone as a trade mark unless it thought that it would thereby obtain a degree of commercial advantage which it does not now enjoy. The use of the mark in order to secure this advantage is bound, in my view, to give rise to a tendency for the existing confusion to increase. This is not, I think, something which the court can accept with equanimity. In My Kinda Town Ltd v Soll [1983] RPC 407, which was a passing off case, Oliver LJ said (at page 425):
"The question to be asked is, no doubt, in all cases the same - is the get-up, or the method of training" (sic, presumably this is a misprint for `trading') "or the use of a particular trading name by the defendants calculated to lead to the belief that their business is the plaintiff's business? But it becomes an extraordinarily difficult question to answer where there is already a substantial potentiality for confusion of the two businesses, simply by reason of their being engaged in the same trade. That does not mean, of course, that a defendant is legitimately entitled to build on and increase that potentiality in such a way that confusion becomes worse confounded, but it does mean that where evidence of actual confusion is tendered it has to be approached ... with the caveat that there may well be reasons why it occurs which involve no question of legal liability at all."
61. In the present case the question being, as I have said, a hypothetical one, we are not concerned to appraise evidence of actual confusion. But the indication that it is not legitimate for a party to build on and increase an existing potential for confusion "in such a way that confusion becomes worse confounded" is, in my judgment, of assistance. It seems to me that the registration by BB of the word Budweiser alone, when no such registration now subsists, would build on and increase the potential for confusion (indeed the reality of such confusion) and that this is something which leads to the conclusion that the use of that word is disentitled to protection in a court of justice by reason of confusion.
62. I therefore differ from the Judge on this point and find that the Section 11 objection is made out on this basis. To the extent that Walton J based his conclusion in the Bud case on the view that the matter had effectively been determined in the passing off action I think that he too was wrong, although I do not question the correctness of his decision so far as it was based on other grounds.
63. It then becomes necessary to consider the effect of Section 12(2) of the 1938 Act. At first sight it might be thought that this qualifies only Section 12(1). It was, however, common ground before us that Section 12(2) is capable of overriding Section 11 as well as Section 12(1). So far as material it provides:
"(2) In case of honest concurrent use, or of other special circumstances which in the opinion of the Court ... make it proper so to do, the Court may permit the registration by more than one proprietor in respect of ... the same goods ... of marks that are identical or nearly resemble each other."
64. The marks which AB and BB respectively seek to register are, of course, identical and so are the goods in respect of which registration is sought. It would not be lawful to register both these marks except in exercise of the power conferred by Section 12(2). BB's preferred result is that both marks should be allowed to proceed to registration, with Section 12(2) being applied in favour of both. AB's contention is that Section 12(2) should not be applied for the benefit of BB, with the result that its own application would be the only one to succeed and it need place no reliance itself on Section 12(2).
65. As I see it the questions which need to be considered are (i) whether there has been honest concurrent use of the name Budweiser; (ii) whether there are other special circumstances; and (iii) if either (i) or (ii) is made good, whether the discretion of the Court should be exercised in favour of registration of the identical marks.
66. As to the first of these matters, no doubt is cast upon the honesty of BB's conduct. The question is whether BB's use of the name Budweiser amounts to use which can appropriately be described as concurrent with AB's undoubted use of the same name. Mr. Hobbs argued that it cannot because it was use only as part of the composite name Budweiser Budvar´. But as I have already said, I agree with the conclusion of Rimer J that "at all times since about 1973, BB has used the word Budweiser as a trade mark not only as part of the composite Budweiser Budvar label but also on its own". This finding was in my view justified not only by the "fairly modest" use of Budweiser on its own, but by the fact that the word forms the predominant element of the composite name and the giving of proper, but not undue, weight to the way in which BB's beer is referred to by traders and customers. Having regard to this conclusion I am satisfied that there has been honest concurrent use. I am fortified in this view by the fact that Whitford J seems to have taken a similar view in the passing off case, as did Walton J in the Bud case.
67. It is not, therefore, strictly necessary to consider whether there are "other special circumstances", although I propose to state my conclusion as the matter is really one of impression, not capable of much elaboration. Looking at all the facts of this case the circumstances appear to me to be very unusual. Even if I were wrong in thinking that what has occurred amounts to honest concurrent user, I would take the view that the circumstances are, by any standards, "special".
68. That leaves the question whether the Court ought to exercise the discretion conferred by Section 12(2) in favour of BB. The discretion was that of Rimer J rather than of this Court. Although I disagree with his conclusion on Section 11 this does not affect his decision on Section 12(2), which he carefully expressed to be made in case he was wrong on the Section 11 objection. I agree with that part of his decision and would reach the same conclusion if the discretion were mine.
BB's appeal

69. Although BB has appealed against that part of the order of Rimer J which dismissed BB's appeal against the decision of Mr. Harkness to allow AB's applications, as well as BB's, to proceed to registration, Mr. Kitchin explained to us that this appeal was mainly precautionary, to cover the possibility that we should not allow BB's own application to proceed. In that event BB contended that AB's applications should not proceed either. As that position has not been reached, I do not find it necessary to go into BB's appeal


Conclusion
70. In my judgment both appeals should be dismissed.
Order: Appeal and cross-appeal dismissed with costs to be assessed. Leave to appeal to House of Lords refused.

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