Scottish Court of Session Decisions

Garage Door Company v. Paterson & Anor [2003] ScotCS 138 (7 May 2003)

OUTER HOUSE, COURT OF SESSION
P997/03	OPINION OF LADY PATON in the cause THE GARAGE DOOR COMPANY (SCOTLAND) LIMITED Pursuers; against (FIRST) STUART PATERSON, and (SECOND) THE GARAGE DOOR & GATE COMPANY (GLASGOW) LIMITED Defenders:   ________________

 

 

Pursuers: Sandison, Advocate; Morisons

Defenders: Weir, Advocate; Burness

7 May 2003

1. The only question before the court today is whether the interim interdict, granted on 9 April 2003 in terms of the unamended third conclusion of the summons, should be extended to prohibit the defenders from using not only the trade name "The Garage Door Company" but also the trade name "The Garage Door and Gate Company".
2. At the outset I should say that I accept that, in the defenders' line of business, the words "garage door" are an obvious way of indicating the sort of fitments and services which they offer. I therefore accept that the words are descriptive, and that, in general, a small change to a trade name containing such descriptive words may suffice to differentiate one business from another competing business: see Salon Services (Hairdressing Supplies) Ltd v Direct Salon Services Ltd, 1988 S.L.T. 414; Office Cleaning Services Ltd v Westminster Window and General Cleaners Ltd. (1946) 63 R.P.C. 39. But of course, every case turns on its own facts, and I now address the circumstances in the present case.

Prima facie case

3. I deal firstly with the question whether a prima facie case of apprehended passing-off has been made out.
4. The pursuers have a long-established business supplying and installing garage doors and other fitments. They entered into a franchise agreement with the defenders. The franchise came into effect on 6 December 1999, and terminated on 4 February 2003. There is a dispute as to why it ended. The defenders maintain that the pursuers failed to fulfil their contractual obligations, forcing the defenders to terminate the agreement. The defenders also maintain that, following its termination, they wished to disassociate themselves from the pursuers' established business, and to start afresh with their own business.
5. However, on the information before me, I find it difficult to accept that the defenders truly wished, or indeed currently wish, to disassociate themselves from the pursuers' business. It appears that following upon the termination of the franchise agreement, the defenders continued to do the same sort of business in the same premises. They continued to use the pursuers' well-known logo of five cartoon characters standing in front of a half-opened up-and-over garage door. They continued to use the pursuers' instantly recognisable slogan - "fast, friendly and efficient". They continued to use the pursuers' name "The Garage Door Company". They continued to use the telephone lines and numbers which had been set up as part of the franchise agreement, thus benefiting from business obtained through a Yellow Pages advertisement which had been placed at a time when the franchise still existed.
6. The pursuers, not surprisingly, objected to the defenders' activities. They raised the present court action, seeking various interim interdicts. After the first court date, which I understand to have been 28 March 2003, the case was continued firstly to 1 April 2003, and then continued further, certain undertakings having been given by counsel for the defenders on behalf of his clients.
7. The defenders then appear to have been slow to fulfil those undertakings. In particular, on Wednesday 2 April 2003, the defenders were continuing to use the name "The Garage Door Company" and the logo of five cartoon characters at their premises and on their vans. This was demonstrated by photographs taken on 2 April 2003, and lodged in process. Further on Saturday 5 April 2003, the first defender called on a prospective customer, and left a business card printed with the name "The Garage Door Company", the logo of five cartoon characters, and the slogan "fast, friendly and efficient".
8. In the circumstances, the pursuers were obliged to return to court. The matter came before me on 9 April 2003. At that stage, no defences had been lodged. Counsel for the defenders, Mr J G Thomson, indicated that he was concerned that the undertakings had not been implemented. He stated that he thought that he had explained matters appropriately to the defenders, but that they had been under the impression that they would have a reasonable time within which remove logos and so on. At that hearing, counsel for the defenders indicated - I understand, for the first time - that the defenders now intended to use the name "The Garage Door and Gate Company". He further indicated that the defenders were actively working on creating a new business style or get-up. A proposed design for the proposed new name was exhibited in court, and after some discussion, was lodged in process as number 7/2 of process.
9. Counsel for the defenders thereafter conceded, very properly, that the pursuers were entitled to interim interdict prohibiting the use of the name "The Garage Door Company", the logo with cartoon characters, and the slogan "fast, friendly and efficient". However counsel contended that the defenders were entitled to continue using the telephone lines and numbers, and to use the name "The Garage Door and Gate Company".
10. I granted certain interim interdicts, including interdict against the defenders from using the telephone numbers. Nevertheless, as the situation relating to the defenders' business style or get-up was at that stage fluid and developing, and as I considered that the defenders might well succeed in creating a business style or get-up which would not mislead customers into thinking that they were dealing with the pursuers' business, I was not on that occasion persuaded to interdict the use of the name "The Garage Door and Gate Company". Importantly, however, I did not indicate any approval of the new business style or get-up depicted in number 7/2 of process, which had been put forward by counsel very much as a draft or proposal which might undergo considerable further alteration. I ordered that defences be lodged.
11. The pursuers have now enrolled for extension of the interim interdict to include the name "The Garage Door and Gate Company". At a hearing on 6 May 2003, new productions were lodged, including samples of stationery, and recent photographs of the defenders' premises and vehicles. The productions showed inter alia the style or get-up of the defenders' use of the name "The Garage Door and Gate Company" as it appears over the defenders' entrance door, on the defenders' vans, on stationery such as order forms and quotation forms, and in an application form for a yellow pages advertisement. Certain features are instantly noticeable. Firstly, the size and type of printing chosen by the defenders is very similar to that used by the pursuers. Also the layout, spacing and general impression given by the van liveries is similar to that of the pursuers' van liveries. Again the layout and content of the yellow pages advertisement are in some ways similar to the pursuers' yellow pages advertisement. The defenders have of course been obliged by court order to abandon certain items of style or get-up - such as the five cartoon characters - but they have continued to use what appears in the background of the pursuers' logo, namely a half-opened up-and-over garage door.
12. The impression which I have formed on the basis of the history of this case to date, together with up-to-date information and the new productions, is that, rather than seizing an opportunity to make a clean break from the pursuers and to present a completely different company style, the defenders are continuing to adhere as closely as they feel they can to the pursuers' business style and get-up, the motivation appearing to be (prima facie at least) to encourage or prolong a perception on the part of customers that the defenders' business is the pursuers' business, or at least some branch or subsidiary of it, in order to benefit from the pursuers' established custom and reputation. In such circumstances, I am unable to hold that the mere insertion of the words "and Gate" in the trade name "The Garage Door Company" is sufficient to distance or differentiate the defenders' new business from the pursuers' long-established business. Put another way, while I accept that, as a result of court orders, the distinctive cartoon characters and slogan no longer appear as part of the defenders' business style or get-up, I am not satisfied that the defenders have managed to attain sufficient differentiation from the pursuers' business style or get-up. On the contrary, it seems to me that customers who have been used to dealing with the defenders, or potential customers visiting the premises or seeing the defenders' vans driving by or receiving a quotation from the defenders, may well be misled into thinking that they are dealing with the pursuers' business or some branch or subsidiary of it.
13. Accordingly, as matters have developed since the last hearing on 9 April 2003, I am now persuaded that the pursuers have made out a reasonably strong prima facie case of apprehension of passing off.

Balance of convenience

14. I now deal with balance of convenience. If the interim interdict is extended to include interdict against the defenders' using the name "The Garage Door and Gate Company", the defenders will suffer the expense and inconvenience of having to replace the sign over their entrance, and re-doing the van liveries. They will also have the trouble and expense of having to replace stationery, and trying to alter or cancel the advertisement in the yellow pages. All of those matters, the defenders' counsel submitted, indicated that on a balance of convenience, the extension of the interim interdict should be refused.
15. If, however, the interim interdict were not to be extended to include interdict against the defenders' using the name "The Garage Door and Gate Company", the pursuers might suffer a significant loss of business, and loss of or damage to the goodwill and reputation which they have built up over the years. It may be difficult to regain lost business or reputation in the end of the day. It may also be difficult to quantify their loss. In addition, the pursuers are the long-established business, whereas the defenders are ostensibly desirous of setting up a new, fresh business with no ties or connexions with the pursuers. Counsel for the pursuers pointed out that, if the defenders were ultimately vindicated at the end of the litigation, it would be a relatively easy matter to quantify the cost and expense incurred in having to change the business sign, van liveries, stationery, and yellow pages advertisement. Moreover, in counsel's submission, in view of the stance adopted by the pursuers on 9 April 2003 in connection with the possible use of the name "The Garage Door and Gate Company", the defenders had taken a calculated risk in proceeding in the way they had.
16. In all the circumstances, I am satisfied that the balance of convenience favours the pursuers, for the reasons outlined by the pursuers' counsel.

Conclusion

17. I shall recall the interim interdict granted on 9 April 2003, and grant a fresh interim interdict in terms of the third conclusion as amended.