Intellectual Property Enterprise Court

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
INTELLECTUAL PROPERTY ENTERPRISE COURT

		Royal Courts of Justice, Rolls Building Fetter Lane, London, EC4A 1NL
		27/03/2015

Judge Hacon :

1. The Claimant ("Vertical Leisure") conducts a business in the design and manufacture of poles which are used for dance and exercise. They are sold under the trade mark 'X-Pole'. The market for such poles is an expanding one in which Vertical Leisure and the First Defendant ("Poleplus") compete. Business was apparently boosted in this country when London was host to the World Pole Dancing Championships in July 2013.
2. In 2013 Vertical Leisure developed a new type of accessory for use with poles which was given the name 'SILKii'. It was first disclosed at the International Fitness Showcase held at the Blackpool Winter Gardens between 20 and 24 March 2013 and there was an official launch at the FIBO exhibition in Cologne on 11 and 12 April 2013.
3. Poleplus has been trading since the end of 2012. The primary figure behind the business is Susan Colebourne who since September 2012 has been the sole director. She owns 99 of the 100 shares in the company. The other person running Poleplus is the Second Defendant, Peter Bowley. Mr Bowley was a director of the company at the time of its incorporation but resigned in September 2012. He owns the other share. Ms Colebourne and Mr Bowley have been partners in the personal sense for some time and they are now engaged to be married.
4. The main product marketed by Poleplus is an accessory for poles which is a means of attaching lengths of silk to a pole. It was developed by Mr Bowley and launched in March 2013 under the name 'Polesilks'. There was some contact between Poleplus and Vertical Leisure around this time and according to Mr Bowley Vertical Leisure considered the Polesilks product but said that they did not wish to buy it because they had no interest in pole accessories.
5. Mr Bowley then became aware of Vertical Leisure's 'SILKii' pole accessory and took the view that Vertical Leisure had unfairly stolen the idea behind it from Poleplus. He discovered that Vertical Leisure had not registered any domain names consisting of 'SILKii', either alone or in combination with Vertical Leisure's primary trading name 'X-Pole'. He decided to take advantage. The 'X-Pole' and 'Silkii' domain names in issue were registered in batches by Mr Bowley on 12 April, 29 July, 7 August and 8 August 2013, 12 domain names in all.
6. On 2 June 2014 I gave summary judgment against Mr Bowley, finding that his registration of the domain names constituted acts of passing off, including the creation of instruments of fraud – see British Telecommunications plc v One in a Million Ltd [1999] 1 WLR 103 (CA). At that hearing the claimant alleged that Poleplus was jointly liable with Mr Bowley both because there had been common design between them and because Poleplus was vicariously liable. Neither of these allegations had been pleaded and at that point Poleplus denied that Mr Bowley was its employee. I was not prepared to give summary judgment against Poleplus, particularly not on grounds outside those pleaded.
7. There was also an allegation that Poleplus and Mr Bowley had infringed Vertical Leisure's trade marks. I did not give summary judgment in relation to the trade marks because there were points that might have afforded an arguable defence which had been left unexplored.
8. In July 2014 Vertical Leisure served Re-Amended Particulars of Claim. A new section headed 'Liability of First Defendant for acts of the Second Defendant' stated that Poleplus was liable for Mr Bowley's acts of passing off on four grounds, namely that the registrations of the offending domain names by Mr Bowley were:

(1) done pursuant to a common design with Poleplus;

(2) acts for which Poleplus was vicariously liable as employer of Mr Bowley;

(3) done by Mr Bowley acting as agent for Poleplus;

(4) acts 'adopted' by Poleplus.

9. On 15 August 2014 an Amended Defence was served. The denial that Mr Bowley was an employee of Poleplus has been changed to an admission that he was. It was also admitted that Mr Bowley had authorisation to register domain names on behalf of Poleplus, but denied that Mr Bowley had done so as Poleplus's agent. Common design, vicarious liability and 'adopting' Mr Bowley's acts were all likewise denied.
10. Although the allegation of trade mark infringement remained in the Re-Amended Particulars of Claim it was not pursued at trial. The only issue was whether Poleplus was liable for passing off along with Mr Bowley.

The facts in dispute

11. Broadly two issues of fact emerged during the trial. The first was whether Ms Colebourne knew about all or any of the registrations by Mr Bowley. The second was whether they were done by Mr Bowley on Poleplus's behalf as part of his duties, or alternatively for his own benefit and separately from his duties to Poleplus.

The witnesses

12. Ms Colebourne and Mr Bowley were the only witnesses who were cross-examined. My impression was that Ms Colebourne was a truthful witness in cross-examination, although this involved some changes from the account she had given in her witness statements regarding Mr Bowley's role in the company. She was expressive and quite emotional when she stated her belief that Mr Bowley's prime motive in registering the domain names was to protect her.
13. Unfortunately in the witness box Mr Bowley's instinct for protection took the form of argumentative replies and a reluctance to say anything which he thought might harm Poleplus's case and thus jeopardise Ms Colebourne's interest. He was not a helpful witness, either to the court or to Ms Colebourne.

Poleplus's knowledge

14. It was common ground that Ms Colebourne's knowledge regarding the registrations could be ascribed to Poleplus. The domain names in issue were registered by Mr Bowley between 12 April and 8 August 2013. Ms Colebourne indicated in her witness statement that she was first told about these registrations in July 2013. She said that she thought this was a really stupid thing for Mr Bowley to have done and told him that she was worried that he would get into trouble if he used them. She added that she was furious with Mr Bowley when Poleplus received complaints about the registrations from Vertical Leisure.
15. In cross-examination Ms Colebourne maintained the denial of any knowledge of Mr Bowley's registrations, certainly up to the point when he told her about them. I accept that evidence. I have doubts about the registrations that must have happened after Mr Bowley's confession in July 2013 – the last registrations were on 8 August 2013. Ms Colebourne left this vague, but she was not pressed about it. On balance I don't believe I can conclude that she knew about any of the registrations in advance of Mr Bowley making them.

Whether Mr Bowley made the registrations in his own interest

16. Both Ms Colebourne and Mr Bowley claimed in their written evidence that Mr Bowley's registrations were done only for his personal benefit. In cross-examination Mr Bowley said the same thing but generally refused to be drawn into clear answers with regard to his responsibilities in Poleplus's business.
17. Ms Colebourne was more forthcoming. She made it clear that Poleplus was run by her and Mr Bowley as a team. Emails sent on behalf of the company by either of them individually were signed "Sue and Pete" as a matter of course. They divided responsibilities. Technical matters, including those which concerned the company website and the registration of domain names, were left to Mr Bowley. They were his areas of expertise and responsibility. Ms Colebourne said that Mr Bowley had the power to take decisions on the part of Poleplus in relation to, among other things, the company's domain names.
18. An example of the evidence consistent with this was an email exchange between Mr Bowley and Zoe Hudson. Ms Hudson was a potential customer and also offered advice to Mr Bowley about Poleplus's websites. On 24 June 2013 Mr Bowley sent a message from the 'poleplus@live.co.uk' address which included this:

"Question you where looking for Silkii well as I was emailed when x pole show cased it in germany in march I immediately bought the .com and .co.uk so should I put a forwarding on these to our site to capture traffic like urs?"

It was agreed that here Mr Bowley was informing Ms Hudson that he had registered various 'Silkii' domain names shortly after Vertical Leisure had launched the Silkii product in Germany (which in fact was in April 2013) and was asking whether messages to those sites should be forwarded to the Poleplus sites to capture traffic, such as that from customers like Ms Hudson. Ms Hudson responded about 20 minutes later:

"Lol smart cookie! Serves them right!"

19. Ms Colebourne said that this message from Mr Bowley, openly discussing the registration of the domain names in issue and with quite a striking response from Ms Hudson, would have been picked up by her on her iPhone. There were other messages Ms Colebourne would have received, though none directed to her, in which Mr Bowley had referred to his registration of the domain names in issue. Ms Colebourne denied all knowledge of the content these messages. She said that when she picked them up she would have seen that they were about websites and domain names. This was Mr Bowley's concern, not hers. She had therefore not read them. That is why she knew nothing about any of the domain names in dispute until Mr Bowley informed her in July 2013. I have accepted that Ms Colebourne did not know, but it reinforces the fact that the responsibility for registration of domain names by and on behalf of Poleplus was the sole preserve of Mr Bowley.
20. Mr Bowley pointed out that the offending domain names were registered in his name. He said that he hoped to make some money for himself out of them and to make Vertical Leisure look foolish and that accordingly the registrations had had nothing to do with Poleplus. I do not accept that they had nothing to do with Poleplus. The evidence showed that other domain names, ones which indisputably were central to Poleplus's business such as www.polesilks.co.uk and www.polesilks.com, had likewise been registered by Mr Bowley in his own name. On at least one occasion Mr Bowley registered offending domain names and names for legitimate use by Poleplus at exactly the same time. This is consistent with Mr Bowley running all matters to do with websites. That he is recorded as registrant of the offending domain names is no guide to the intended beneficiary. Moreover Ms Colebourne knew that Poleplus's domain names had been registered in Mr Bowley's name and she said that this did not concern her. It may be that the domain names are held on trust by Mr Bowley for Poleplus, but the precise position in law does not matter here. The important point is that it was part of the conduct of Poleplus's business, known to both Ms Colebourne and Mr Bowley, that Mr Bowley registered domain names for the benefit of Poleplus with himself as registrant.
21. It is not fully clear who paid for these registrations. The disclosure from Poleplus revealed that both offending domain names and those properly registered for Poleplus's use were paid for by Mr Bowley using a credit card with a number ending in '0815'. The Defendants were requested in correspondence to give disclosure of records relating to that credit card in order to find out whether it was a Poleplus business card or a card used for the personal expenses of Mr Bowley. I was told that no such disclosure had been forthcoming. I asked Mr Wood, who appeared as trade mark advocate for Poleplus, why this was. He told me that Mr Bowley had failed to supply him with the relevant documents. I think that the only conclusion I can draw from this failure was that the credit card was used for the business of Poleplus.
22. I find that Mr Bowley applied for the domain names in issue on behalf of Poleplus as part of his duties as employee of that company and that this was done for the benefit of, and was probably paid for by, Poleplus. I accept Ms Colebourne's evidence that Mr Bowley believed that in doing so he would protect the business of Poleplus and thereby protect Ms Colebourne. In my view this was by far the primary reason in Mr Bowley's mind for registering those domain names.

Liability as joint tortfeasor through common design

23. The law on joint liability for the tortious acts of another, distinct from the laws of vicarious liability and agency, has origins dating at least from the observations of Erle J in Lumley v Gye (1853) 2 El. & Bl. 216, at 232. The rule in its present form can be simply stated: a party is jointly liable for a tort committed by another if he either (a) procured the tort or (b) participated with the primary tortfeasor in a common design relating to the tort.
24. There is no standalone civil liability by reason of procuring a tort committed by another (or, presumably, participating in a common design with the primary tortfeasor). It follows, for instance, that an employer is not vicariously liable for the acts of an employee who is himself liable only through being a joint tortfeasor – see Credit Lyonnais Bank Nederland NV v Export Credits Guarantee Department [2000] 1 AC 486, at 497-500.
25. The relationship between procurement and common design has been considered several times. In CBS Songs Ltd v Amstrad Consumer Electronics plc [1988] AC 1013 Lord Templeman, with whom the other members of the House agreed, appeared to suggest that procurement is a subset of common design (at p.1058, see below). Shortly afterwards in Unilever plc v Gillette (UK) Ltd [1989] RPC 20 Mustill LJ stated that he preferred the view that there were the two distinct routes to joint tortfeasance (at p.608). The House of Lords in SABAF SpA v Meneghetti SpA [2004] UKHL 45; [2005] RPC 10 implied that only common design matters (at [40]) – the relevant part of the speech of Lord Hoffmann is quoted below). In Twentieth Century Fox Film Corp v Newzbin Ltd [2010] EWHC 608 (Ch); [2010] FSR 21 Kitchin J observed that there is a considerable overlap between the procurement and common design (at [103]).
26. From this I draw the conclusion that it will seldom if ever be possible to establish joint tortfeasance on the basis of procurement where there is no common design. Procurement is probably a species of common design. Procurement in its various forms – inducement, incitement and persuasion – is sometimes going to be the clearest way to show that there was a common design.
27. In SABAF SpA v Meneghetti SpA [2003] RPC 14, the Court of Appeal drew together a number of earlier authorities and ruled that in the context of both procurement and common design the key criterion was whether the alleged joint tortfeasor had made the tort his own. Peter Gibson LJ, giving the judgment of the Court, said this (at [59]):

"The underlying concept for joint tortfeasance must be that the joint tortfeasor has been so involved in the commission of the tort as to make himself liable for the tort. Unless he has made the infringing act his own, he has not himself committed the tort. That notion seems to us what underlies all the decisions to which we were referred. If there is a common design or concerted action or otherwise a combination to secure the doing of the infringing acts, then each of the combiners has made the act his own and will be liable."

This aspect of the judgment was not appealed but in the subsequent judgment of the House of Lords Lord Hoffmann (with whom the rest of the House agreed) summarised the law in relation to joint tortfeasance in a short sentence (SABAF Spa v MFI Furniture Centres Ltd [2004] UKHL 45; [2005] RPC 10, at [40]):

"The test for such liability in English law is whether the acts were done pursuant to a common design so that the secondary party has made the act his own."

28. What must a party have done to have 'made the act his own'? I think this emerges from what courts have taken 'common design' and also 'procurement' to mean.

Common design

29. In Unilever Mustill LJ (with whom Ralph Gibson and Slade LJJ agreed) emphasised that the expression 'common design' is not a statutory term but just a convenient means of describing a form of joint behaviour on the part of the primary and alleged joint tortfeasors (at p.609):

"I use the words 'common design' because they are readily to hand, but there are other expressions in the cases, such as 'concerted action' or 'agreed on common action' which will serve just as well. The words are not to be construed as if they formed part of a statute. They all convey the same idea. This idea does not, as it seems to me, call for any finding that the secondary party has explicitly mapped out a plan with the primary offender. Their tacit agreement will be sufficient. Nor, as it seems to me, is there any need for a common design to infringe. It is enough if the parties combine to secure the doing of acts which in the event prove to be infringements."

30. Thus, where the tort is an infringement of an intellectual property right, the primary infringer and alleged joint infringer must have co-operated in some way to secure that the relevant acts were carried out.
31. In the context of a tort of strict liability, such as patent infringement, neither of the parties need have been aware that those acts were unlawful. Where knowledge is a constituent of the tort (as in breach of confidence or secondary infringement of copyright, for instance) the parties' knowledge will be relevant to the establishment of joint tortfeasance (see Vestergaard Frandsen A/S v Bestnet Europe Ltd [2013] UKSC 31; [2013] RPC 33, at [36] to [37]).
32. Mustill LJ's reference to the sufficiency of a 'tacit agreement' has to be reconciled with other judgments. The co-operation of the alleged joint infringer must go beyond merely assisting, even knowingly assisting, the primary defendant to carry out the relevant act – per Hobhouse LJ in Credit Lyonnais Bank Nederland NV v Export Credits Guarantee Department [1998] 1 Lloyd's Rep. 19, at 46 (by implication approved by the House of Lords in dismissing the further appeal, at [2000] 1 AC 486, in particular at 496).
33. So, for instance, the supply of a recording machine capable of being used for a tortious act, i.e. the copying of musical recordings and thereby the infringement of copyright, to purchasers who copied and infringed, did not render the supplier liable. The machine was capable of being used for both lawful and unlawful purposes and so there was no common design – see CBS Songs.
34. In L'Oréal SA v eBay International AG [2009] EWHC 1094; [2009] RPC 21 the involvement of the alleged joint tortfeasor was more direct. The primary infringers of the claimant's trade marks had sold infringing products on the defendant's online marketplace. In contrast with the position in CBS Songs, the infringements had not occurred by use of a machine which had left the control of the alleged joint tortfeasor; they came about by means of a website over which the defendant, eBay, had control at the time of the infringements. Arnold J found that eBay facilitated the infringements, which were committed by sellers of infringing goods on its site, that eBay knew that such infringements had occurred and were likely to continue to occur, and that generally eBay profited from such infringements. Yet this was not enough to amount to a common design with the sellers to infringe the claimant's trade marks (at [369] to [382]).
35. Therefore in order to establish joint liability for infringement of an intellectual property right, the alleged joint tortfeasor must have done something more than having knowingly (and even profitably) facilitated the infringements.

Procurement

36. Lord Templeman said this in CBS Songs (at p.1058):

"My Lords, I accept that a defendant who procures a breach of copyright is liable jointly and severally with the infringer for the damages suffered by the plaintiff as a result of the infringement. The defendant is a joint infringer; he intends and procures and shares a common design that infringement shall take place. A defendant may procure an infringement by inducement, incitement or persuasion. … Buckley L.J. observed in Belegging-en Exploitatiemaatschappij Lavender B.V. v. Witten Industrial Diamonds Ltd., at p. 65, that "Facilitating the doing of an act is obviously different from procuring the doing of the act." Sales and advertisements to the public generally of a machine which may be used for lawful or unlawful purposes, including infringement of copyright, cannot be said to 'procure' all breaches of copyright thereafter by members of the public who use the machine. Generally speaking, inducement, incitement or persuasion to infringe must be by a defendant to an individual infringer and must identifiably procure a particular infringement in order to make the defendant liable as a joint infringer."

37. It follows that if the alleged tortfeasor goes beyond merely facilitating the infringement by doing something actively to encourage the relevant infringing act – to induce, incite or persuade the primary infringer to carry it out – this will lead to joint tortfeasance by reason of both procurement and common design.
38. As Lord Templeman pointed out, generally speaking it will be hard to establish the relevant inducement, incitement or persuasion – the procurement – unless the claimant can point to an instance in which the alleged joint tortfeasor procured a particular primary infringer to carry out a particular infringing act. In L'Oréal Arnold J held that absent any such specific instance there could be no joint tortfeasance by procurement (at [359]). In Twentieth Century Fox Kitchin J took the view that Lord Templeman had not intended to be so prescriptive. In that case the defendant ran a website which provided links (the NZB facility) by which a user of the site could acquire pirate copies of films. Kitchin J held that the defendant not only knew that users would infringe, on the facts it had both procured the infringement and engaged in a common design to infringe the claimants' copyrights even in the absence of evidence of procurement of a particular infringing act (at [111]):

"In summary, the defendant operates a site which is designed and intended to make infringing copies of films readily available to its premium members; the site is structured in such a way as to promote such infringement by guiding the premium members to infringing copies of their choice and then providing them with the means to download those infringing copies by using the NZB facility; the activation of the NZB facility in relation to one of the claimants' copyright films will inevitably result in the production of an infringing copy; the defendant has encouraged and induced its editors to make reports of films protected by copyright, including those of the claimants; the defendant has further assisted its premium members to engage in infringement by giving advice through the sharing forums; the defendant has profited from the infringement; and finally, the claimants are not able to identify particular infringements by particular members only because the defendant keeps no records of the NZB files they have downloaded."

Making the act his own

39. The criterion referred to by Lord Templeman – that the alleged joint tortfeasor has done something beyond facilitation to bring about infringement – accords with the requirement that he must have made the act of infringement his own. This connotes the taking of one or more steps intentionally and actively to bring about the infringing acts. In Unilever plc v Chefaro Proprietaries Ltd [1994] FSR 135 Glidewell LJ (with whom Hoffmann and McCowan LJJ agreed) put it this way (at p.138):

"In order to show infringement by common design it is necessary for the plaintiff to show some act in furtherance of the common design – not merely an agreement."

In that case the fact that a parent company controlled a subsidiary which had infringed a patent did not of itself make the parent liable as joint tortfeasor.

40. Since the infringing acts are committed by a party other than the joint tortfeasor, furtherance of the common design by the joint tortfeasor will involve the employment of some means intentionally and actively to cause or encourage the primary infringer to carry out the infringing acts. In the context of online trading, following L'Oréal it would seem that this must be more than just offering a marketplace in the knowledge that it will be used by certain parties as a channel for selling infringing goods. Following Twentieth Century Fox, it will be sufficient for joint liability if the website is structured in such a way as to promote acts of infringement and make them inevitable.

This case

41. I start with the recognition that Poleplus means Ms Colebourne. On any view Ms Colebourne could not have done anything intentionally to cause or encourage Mr Bowley to register the offending domain names if she did not know about such registrations in advance. On the findings I have made about Ms Colebourne's knowledge, Poleplus is not thereby jointly liable by reason of a common design. Even if Ms Colebourne had known that some of the registrations were being made – I have in mind those done after Mr Bowley's confession of earlier registrations – there was no evidence that Ms Colebourne did anything actively to cause or encourage Mr Bowley to register further domain names. In my view Poleplus would still not be jointly liable for them because of any common design.
42. It was submitted that Mr Bowley's knowledge could be ascribed to Poleplus. This threatened to become an artificial argument about whether there was a common design between Mr Bowley as himself and Mr Bowley as Poleplus. I think that if there were anything in this it can only be properly analysed and justified under one of the other headings on which Vertical Leisure relied to render Poleplus liable for Mr Bowley's acts.

Vicarious liability

43. In support of Vertical Leisure's argument on this aspect of its case Mr Hughes, who appeared for Vertical Leisure, directed my attention to Clerk & Lindsell on Torts, 21st ed., paras. 6-28 to 6-33. In particular he relied on the discussion of the 'close connection test' in paras. 6-29 to 6-32, a test derived from the ruling of the House of Lords in Lister v Hesley Hall Ltd [2001] UKHL 22; [2002] 1 AC 215.
44. In Lister Lord Steyn said this at [28]:

"The question is whether the [employee's] torts were so closely connected with his employment that it would be fair and just to hold the employers vicariously liable."

In similar vein Lord Millett stated at [70]:

"What is critical is that attention should be directed to the closeness of the connection between the employee's duties and his wrongdoing and not to verbal formulae. This is the principle on which the Supreme Court of Canada recently decided the important cases of Bazley v Curry 174 DLR (4th) 45 and Jacobi v Griffiths 174 DLR (4th) 71 which provide many helpful insights into this branch of the law and from which I have derived much assistance."

45. Shortly after Lister the House of Lords gave judgment in Dubai Aluminium Co Ltd v Salaam [2003] 2 AC 366. One of the issues in Dubai Aluminium was the vicarious liability of a firm of solicitors for the acts of one of its partners. Lord Nicholls, with whom the rest of the House agreed, said this:

"[30] I turn, then, to cases such as the present where there is no question of reliance or 'holding out', or of the employer having assumed a direct responsibility to the wronged person. Take a case where an employee does an act of a type for which he is employed but, perhaps through a misplaced excess of zeal, he does so dishonestly. He seeks to promote his employer's interests, in the sphere in which he is employed, but using dishonest means. Not surprisingly, the courts have held that in such a case the employer may be liable to the injured third party just as much as in a case where the employee acted negligently. Whether done negligently or dishonestly the wrongful act comprised a wrongful and unauthorised mode of doing an act authorised by the employer, in the oft repeated language of the 'Salmond' formulation: see Salmond, Law of Torts, 1st ed (1907), p83. As Willes J said, in Barwick v English Joint Stock Bank (1867) LR 2 Ex 259, 266:

"It is true, [the master] has not authorized the particular act, but he has put the agent in his place to do that class of acts, and he must be answerable for the manner in which the agent has conducted himself in doing the business which it was the act of his master to place him in."

[31] In Hamlyn v John Houston & Co [1903] 1 KB 81, 85, one aspect of the business of the defendant firm of grain merchants was to obtain, by lawful means, information about its competitors' activities. Houston, a partner in the firm, obtained confidential information on the plaintiff Hamlyn's business by bribing one of Hamlyn's employees. The Court of Appeal held the firm was liable for the loss suffered by Hamlyn. Sir Richard Henn Collins MR said that if it was within the scope of Houston's authority to obtain the information by legitimate means, then for the purpose of vicarious liability it was within the scope of his authority to obtain it by illegitimate means and the firm was liable accordingly. Sir Richard Henn Collins MR rested his decision on the broad 'risk' principle: the principal having selected the agent, and being the person who will have the benefit of his efforts if successful, it is not unjust he should bear the risk of the agent "exceeding his authority in matters incidental to the doing of the acts the performance of which has been delegated to him".

[32] The limits of this broad principle should be noted. A distinction is to be drawn between cases such as Hamlyn v John Houston & Co [1903] 1 KB 81, where the employee was engaged, however misguidedly, in furthering his employer's business, and cases where the employee is engaged solely in pursuing his own interests: on a 'frolic of his own', in the language of the time-honoured catch phrase. In the former type of case the employee, while seeking to promote his employer's interests, does an act of a kind he is authorised to do. Then it may well be appropriate to attribute responsibility for his act to the employer, even though the manner of performance was not authorised or, indeed, was prohibited. The matter stands differently when the employee is engaged only in furthering his own interests, as distinct from those of his employer. Then he "acts as to be in effect a stranger in relation to his employer with respect to the act he has committed": see Isaacs J in Bugge v Brown (1919) 26 CLR 110, 118. Then the mere fact that the act was of a kind the employee was authorised to do will not, of itself, fasten liability on the employer. In the absence of 'holding out' and reliance, there is no reason in principle why it should. Nor would this accord with authority. To attribute vicarious liability to the employer in such a case of dishonesty would be contrary to the familiar line of 'driver' cases, where an employer has been held not liable for the negligent driving of an employee who was employed as a driver but at the time of the accident was engaged in driving his employer's vehicle on a frolic of his own.

[33] In Kooragang Investments Pty Ltd v Richardson & Wrench Ltd [1982] AC 462, 473-475, Lord Wilberforce drew this distinction with his accustomed lucidity and authority. He rejected the broad proposition that so long as the employee is doing acts of the same kind as those it is within his authority to do, the employer is liable and he is not entitled to show the employee had no authority to do them. Lord Wilberforce said:

"the underlying principle remains that a servant, even while performing acts of the class which he was authorised, or employed, to do, may so clearly depart from the scope of his employment that his master will not be liable for his wrongful acts."

In the Kooragang case the employee, authorised to carry out valuations, negligently carried out a valuation without authority from his employers and not on their behalf. In doing so he was not acting as an employee of the defendant company. The company was not liable for his wrongful acts. That was a case of negligence, but a similar approach is no less applicable in cases of dishonesty."

46. Leaving aside cases in which there was a holding out of authority and reliance on it, or the employer having assumed direct responsibility to the wronged person, the rule in Dubai Aluminium is in summary that in order for an employer to be vicariously liable for the acts of its employee it is necessary, but not sufficient, that the employee was doing acts of the kind which he was employed to do; the employee must also have been furthering the interests of the employer rather than his own.
47. The question of which party's interests were being furthered cannot be a binary test – in some cases there may have been a mixed advancement of interests. It seems to me to be consistent with the passage from Kooragang referred to by Lord Nicholls that where, objectively assessed, the employee primarily intended to further the interests of the employer, this is sufficient to fix an employer with vicarious liability. (It may be enough if furthering the interests of the employer formed just some significant part of the employee's intention.) I put it that way because I do not understand the ruling of the House of Lords in Dubai Aluminium to require the court to investigate the actual effect of the employee's acts and to assess which party benefitted from them irrespective of intention.
48. I have found that the primary purpose in the mind of Mr Bowley when he was registering the offending domain names was to protect the interests of Poleplus, and thereby those of Ms Colebourne, and that the registrations were squarely within the type of acts he was employed by Poleplus to do. In my judgment Poleplus is therefore vicariously liable for the acts of passing off by Mr Bowley.

Mr Bowley as agent of Poleplus

49. As an employee of Poleplus, there is no reason why Mr Bowley could not at the same time have been an agent of Poleplus. An employee may or may not have powers of agency to bind his employer or otherwise affect his employer's relations with third parties. It will depend on the facts.
50. I have found that Mr Bowley registered the offending domain names on behalf of Poleplus and for the benefit of Poleplus. Ms Colebourne knew that he applied for such domain names and gave him full authority to do so. The fact that they were registered in Mr Bowley's name made no difference to the common understanding that they were for the use and benefit of Poleplus. They were probably paid for by a credit card set up for expenses incurred in the conduct of the company's business. I have no doubt that when Mr Bowley registered the offending domain names he acted as agent of Poleplus.
51. There is longstanding authority for the proposition that a principal is liable for the infringement of a trade mark by his agent – see Tonge v Ward (1869) 21 L.T. 480, per Lord Romilly at 480-481. A similar rule has for well over a century applied in relation to patent infringement, see Sykes v Howarth (1879) 12 ChD 826. But bearing in mind judgments of more recent standing I think the position is more nuanced than that. In Dubai Aluminium the House of Lords considered the circumstances in which an employee is vicariously liable partly by reference to the liability of a principal for the tortious acts of his agent (such as explained in Hamlyn v John Houston & Co [1903] 1 KB 81). The criteria to be applied are analogous: the question is whether the agent was acting within the scope of his authority as agent in order, misguidedly or otherwise, to further the interests of the principal.
52. For the reasons I have given in relation to vicariously liability, I take the view that Poleplus was jointly liable for Mr Bowley's acts of passing off done in his capacity as Poleplus's agent.

Poleplus 'adopted' the acts of Mr Bowley

53. The argument against Poleplus of 'adoption' was explained to be that Mr Bowley should be treated as the company. This strayed into the law governing the rules of attribution by which an individual's acts may count as the acts of a company, outside the laws of agency and vicarious liability. Little of the relevant law was referred to and I am not prepared to take the argument further.

Conclusion

54. In my judgment Poleplus is jointly liable with Mr Bowley for passing off by reason of his registrations of the offending 12 domain names because Poleplus is vicariously liable for those acts and also on the ground that the registrations were done by Mr Bowley acting as Poleplus's agent.

Postscript

55. After a draft of this judgment had been provided to the parties, it was pointed out to me by Mr Hughes that three weeks ago the Supreme Court handed down judgment in Sea Shepherd UK v Fish & Fish Limited [2015] UKSC 10 in which the Court considered the law on common design. I regret to say that this had escaped my attention and so I was not aware of Sea Shepherd when the judgment above was drafted.
56. I must consider whether Sea Shepherd makes a difference to my conclusion in relation to common design.
57. In Sea Shepherd their Lordships differed on the outcome of the appeal but not on the law. The appeal turned on whether the contribution of the alleged joint tortfeasor to the tort was de minimis. Lord Toulson, Lord Neuberger and Lord Kerr held that the trial judge had been entitled to find that the contribution was de minimis and that accordingly there was no joint liability. Lord Sumption and Lord Mance, dissenting, took the view that the contribution was above the de minimis threshold.
58. Lord Toulson stated the law in relation to common design to be as follows:

"[21] To establish accessory liability in tort it is not enough to show that D did acts which facilitated P's commission of the tort. D will be jointly liable with P if they combined to do or secure the doing of acts which constituted a tort. This requires proof of two elements. D must have acted in a way which furthered the commission of the tort by P; and D must have done so in pursuance of a common design to do or secure the doing of the acts which constituted the tort. I do not consider it necessary or desirable to gloss the principle further."

59. Lord Sumption's summary of the law was in these terms (at [37]):

"…the defendant will be liable as a joint tortfeasor if (i) he has assisted the commission of the tort by another person, (ii) pursuant to a common design with that person, (iii) to do an act which is, or turns out to be, tortious."

60. Lord Neuberger put the test for liability in language very similar to that of Lord Sumption (at [55]):

"It seems to me that, in order for the defendant to be liable to the claimant in such circumstances, three conditions must be satisfied. First, the defendant must have assisted the commission of an act by the primary tortfeasor; secondly, the assistance must have been pursuant to a common design on the part of the defendant and the primary tortfeasor that the act be committed; and, thirdly, the act must constitute a tort as against the claimant."

61. At paragraph 61 Lord Neuberger said that he detected no difference between his analysis of the law and that of Lord Toulson and Lord Sumption. Lord Kerr agreed with the judgments of both Lord Neuberger and Lord Toulson (at [90]). Lord Mance said there was no disagreement about the legal principles (at [91]).
62. Although none of their Lordships expressly considered the relationship between procurement and common design in exactly those terms, Lord Sumption made the following observation (at [41]):

"Inducing or procuring a tort necessarily involves common intent if the tort is then committed."

63. Lord Sumption also considered the scope of liability for joint tortfeasance. I believe that here he had in mind limits distinct from the question of de minimis contribution and that bearing in mind the unanimous statement of agreement on legal principles, Lord Sumption's analysis of the law was common ground between all members of the Court. Lord Sumption identified two limiting features relevant to the scope of joint liability. The first was the alleged joint tortfeasor's intent:

"[44] Intent in the law of tort is commonly relevant as a control mechanism limiting the ambit of a person's obligation to safeguard the rights of others, where this would constrict his freedom to engage in activities which are otherwise lawful. The economic torts are a classic illustration of this. The cases on joint torts have had to grapple with the same problem, and intent performs the same role. What the authorities, taken as a whole, demonstrate is that the additional element which is required to establish liability, over and above mere knowledge that an otherwise lawful act will assist the tort, is a shared intention that it should do so."

64. Thus for the alleged joint tortfeasor to be liable he must have intended that his own act would assist the tort (although he need not have been aware that the act of the primary tortfeasor was, in law, a tort). By implication it is necessary that he knew of the intended act of the primary tortfeasor at the time of his own act.
65. The second limiting feature is the requirement that the alleged joint tortfeasor has actively co-operated with the primary tortfeasor. The two features are to be taken together:

"The required limitation on the scope of liability is achieved by the combination of active co-operation and commonality of intention. It is encapsulated in Scrutton LJ's distinction between concerted action to a common end and independent action to a similar end, and between either of these things and mere knowledge of the consequences of one's acts." (at [44])

66. I interpret this to mean that in order to fix an alleged joint tortfeasor with liability, it must be shown both that he actively co-operated to bring about the act of the primary tortfeasor and also that he intended that his co-operation would help to bring about that act (the act found to be tortious). Liability will always be subject to the threshold requirement that the alleged joint tortfeasor's contribution to the act was more than de minimis.
67. The statement of the law by the Supreme Court does not alter my conclusion in the present proceedings. Poleplus is not jointly liable with Mr Bowley because of a common design. This is for the reasons I have given above.