clr/1984/1984_1_263.pdf

(1)of the Courts of Justice Law, 1960(Law 14/60)—Court of appeal and trial Judge should refrain from pronouncing on the merits of the case and from resolving the factual disputes. Passing off—Ingredients of—Interlocutory injunction—Extent of— Court of Appeal and trial Judgeshouldrefrainfrompronouncing on the merits of the caseandfrom resolvingthe factual disputes. By agenerally endorsed writ therespondents-plaintiffs claimed an injunction restraining the appellants-defendants from passing off their products as the respective products of the plaintiffs; and they, also, by relying on section 32(f) of ihe Courts of Justice Law, 1960 (Law 14/60) applied for an interlocutory injunction. The trial Court after finding "that there was a serious question to be tried at the trial ard that the plaintiffs bave an even chance of succeeding in their claim" granted an inteilocutory injunction by means of which the appellants and their servants or agents were restrained, until ihe final determination of the action, or until further order, from "manufacturing, producing, selling, offering or exposing for sale, distributing or in any way dealing with sports or leisure wear consisting of «rack suits, including the separate jackets and 263 Junitexo Ltd. v. Adidas

(1984)trousers thereof, T-shirts and althetic shorts, any of which bear the three stripes device which appears on the plaintiffs' respective products*'. Hence this appeal. Hcidt Ο that the making of an interlocutory injunction is the outcome of the exercise of discretionary powers which should not be inlerferred with on appeal unless the Supreme Court is satisfied thatthetrial Court's discretion was wrongly exercised: that this Court has not been satisfied that, in the present case. the discretion of the trial Court was wrongly exercised and that, therefore, there exist grounds justifying intervention on appeal in order to set aside ihe complained of interlocutory injunction: accordingly the appeal must fail. ? l·) Held, further, (Per A. Loi~ou, J.. Malachtos, J. concurring):

(1)That the determination of the extent of the interlocutory injunction which touches the questions of reputation, imitation 1 5 of get-up or par» thereof and the proof of likelihood of deception which are the ingredients of the wrong of passing off, is so connected with the factual and legal issues of the case and its merits that this Court should refrain from saying anything and to exhibit the utmost caulion out of fear that any pronouncement 20 made, when dealing with an interlocutory injunction on appeal, mighl be misconstrued or treated as prejudging any of the issues that have to be determined at the trial.

(2)That the «rial Judge properly held that it was undesirable to endeavour to resolve on such evidence as has been adduced 2? the factual disputes on which the result of the action will ultima­ tely turn. Appeal dismissed. Cases referred t o : M. & M. Transport Co. Ltd. v. EnviaAstikon Lcojorion Lemesott Ltd.

(1981)! C.L.R. 605 at pp. 608-609; ?:^ Odysscos v. A. Pieris Estates Ltd.

(1982)I C.L.R. 557 at pp. 568570; Karydas Taxi Co. Ltd. v. Konwdikis

(1975)I C.L.R. 321 at pp. 327-328; Cadbury Scheweppes Pty Ltd. v. Pub Squash Co. Pty Ltd. [1981] 1 All E.R. 213; Universal Advertising and Publishing Agency and Another v. Vouros, XTX C.L.R. 87; 264 35 1 C.L.R. Jonitexo Uil. v. Adidas Edge, v. Nucolls [1911] A.C.693; SpaldingBios. v. Gmnage [1915] 32 R.P.C273. Appeal. Appeal by defendants against theruling of the District Court 5 of Nicosia (G. Nicolaou, DJ.) dated the 7th January, 1982 (Action No. 5183/80) whereby an interlocutory injunction was granted against them in an action for passing off. St. Erotokriiou (Mrs.), for the appellants. G. Phifritis with M. Montamos. for the respondents. H» Cur. adv. vult. The following judgments were read: TRIANTAFYLUDES P.: The appellants have challenged, by.. means of this appeal, an interlocutoiy injunction which was granted bythe DistrictCourt of Nicosia inan action for passing 55 uff (No.5l83/80) which was instituted against them, as defendants, by the respondents, as plaintiff's. The injunction was based on section 32

(1)of the Courts of Justice Law, 1960(Law14/60),andbymeans ofitthe appellants and their servants or agents were restrained, until the final de20 termination of the action, or until further order, from "manufacturing, producing, selling, offering or exposing for sale, distributing orinanywaydealing with sports or leisure wear con-• sisting oftrack suits, including theseparatejackets and trousers thereof, T-shirts andathletic shorts, anyofwhich bear the three 25 stripes device which appears on the plaintiffs' respective products". The following salient facts arc stated in the appealed from decision of the trial Court: 30 35 'The plaintiffs are a German firm engaged in the manufacturc, sale and distribution ona large scale of, inter alia, athletic and leisure wear including track suits, T-shirts and athletic shorts. They cany on their trade in many parts of the WOTId and thty have been in the Cyprus market since 1962. The defendants are a Cyprus firm registered as a limited company in 1978to cany onthe existingbusiness of its present managing director, Mr. Loukas HjiMichael, in the manufacture, sale and distribution of products similar tothoaeoftheplaintiffs, inwhichhehadengaged since1961. 265 TrianlafjHides P. Jonitcxo Ltd. v. Adidas

(1984)By a generally endorsed writ filed on 13th November. 1980, the plaintiffs claim an injunction restraining the defendants from passing off their products as the respective products of the plaintiffs by using what theplaintiff; call the three stripes device which, according to the plaintiffs, has become a distinguishing commercial mark of the plaintiffs' products; and they also claim damages for such passing off." 5 The trial Court after having heard arguments by counsel appearing for the parties, as well as after having considered the 10 evidence which was placed before it, not only by means of affidavits, but, also, when three of the affiants were cross-examined. reached the following conclusion: "Foi the purpose of the present application it seems to me that on the material before me thereis a serious question to 15 be tried at the trial, and that the plaintiffs have an even chance of succeeding in their claim. But having said this, f would not wish to make any further comment on the factual aspect of the matter, save to say that I have not reviewed or commented on the evidence adduced in detail 20 and have not made any other particular finding, advisedly." It has been argued by counsel for the appellants that the expression, in the aforequoted passage, "the plaintiffs have an even chance of succeeding in their claim" docs not amount to a finding that there is a probability that the plaintiffs are entitled 25 to relief, as envisaged by the proviso to section 32

(1)of Law 14/60. 1 cannot agree with this argument because, in my view, the saidexpression should beconstrued in thecontext of the decision of the trial Couit as a whole and, when this isdone,itcan safely 30 be inferred that the trial Court was satisfied that the relevant prerequisite, for making an interlocutory injunction under section 32

(1), did. exist. The trial Couit has,also,examined whether without an interlocutory injunction it would be difficult or impossible to do 35 complete justice at a later stage, and, also, the question of the balance of convenience, and having found that itwould be more convenient and just to grant than to refuse the interlocutory injunction, it granted it as complained. of. 266 1 C.L.R. Jonitexo Lid. v. Adidas Triantafj Hides P. 1 would like to observe that atthestage of granting or refusing an interlocutor injunction, such as the onewhich was made in the present case, the parties should limit themselves to the issue of whether or not, in the light of the provisions of section 32

(1)5 of Law 14/60 and of the relevant principles of law, such an injunction should be granted; and this cleary interlocutory stage of the proceedings should not be treated as anopportunity for theparties tofight outthemerits of thecase either by adduc­ ing evidence or by advancing arguments in this respect. [ ven10 ture to add, further, that save in those cases where there exist such special circumstances as to justify resorting to the remedy of an appeal against an interlocutory injunction, the course whichis most conducivetotheproperadministration ofjustice is to ensure that the pleadings are filed without delay and that the 15 case is heard on its merits as early as possible, without delaying itsdetermination because of an appeal,asin thepresentinstance. The manner of the proper application of section 32

(1)of Law 14/60, in granting or refusing an interlocutory injunction, has been examined in, inter alia, Μ. ά Μ. Transport Co. Ltd. v. 20 Eteria Astikon Leoforion Lemessou Ltd.

(1981)1 C.L.R. 605, 608-609, and Odysseos v. A. PierisEstates Ltd.

(1982)1C.L.R. 557, 568-570. 25 30 35 I consider it useful to observe, in this respect, that as pointed out by Lord Denning M.R. in Hubbart v. Vosper [1972] 1AH E.R. 1023, 1029, "the remedy by interlocutory injunction is so useful that it should be kept flexible and discretionary. It must not be made the subject of strict rules". Furthermore, it is well settled that the making of an inter­ locutory injunction, such as that on the present occasion, is the outcomeof the exercise of discretionary powers whichshouldnot be interfered with on appeal unless the Supreme Court is satis­ fied that the trial Court's discretion was wrongly exercised (see, inter alia,in this connection,Karydas Taxi Co. Ltd. v. Komodikis

(1975)1C.L.R. 321, 327-328 and M. & M. Transport Co. Ltd. case, supra, 611). Having considered carefully all the arguments advance during the hearing of this appeal I have reached the conclusion that I have not been satisfied that, in the present case, the discretion 267 Triantaf>Hides P. Jonitexo Ltd. r. Adidas (t984> of thetrial Courtwas wrongly exercised andthat,therefore,there exist groxuids justifying intervention on appeal in order to set aside the complained of interlocutory injunction. On the contrary, I am satisfied that the elements envisaged by section 32

(1)of Law 14/60 as prerequisites for the making of 5 such an injunction were correctly found by the trial Courtto exist; and, also, that the trial Court approached thematterin the light of the properly applicable thereto principles of law as· regards thecivilwrong ofpassing off, astheyhave beenexpound­ ed in,inter alia, Cadbury Scheweppes Pty Ltd v. PubSquash Co. 10 Pty Ltd. [1981] I All E.R. 213. Theappropriate stageat which therights of the parties tothe action concerneda^e to bedeterminedis whenjudgment will be given on the merits of the action,and not thestage of theinterlocutoiy injunction which is the subject-matter of this appeal; 15 consequently, in order to avoid prejudging, in any way, any of the issues relevant to the merits of this case Τ will refrain from referring toany oneof them; and,ofcourse,thegranting ofthe interlocutory injunction by thetrial Court,andthefact thatsuch injunction is now upheld by this Couit,should not be treated as 20 prejudging whether or not the respondents, as plaintiffs, arcentitled to succeed in their action against the appellants as de­ fendants, As regards, however, the manner in which theinjunction in question has been framed Ishould state that,even though ί do 25 notintend,intheleast, toinfluence theoutcomeof the afo.esaid action,Ihave leached theconclusion thattheinjunction is wider in scope than necessary, in that it prohibits the appellants and their servants or agents from maniLfacturing or soiling goods which bear the three stripes mark - (which is alleged by the 30 respondents to have become the distinctive commercial mark of their products) - and which, at the same time, bear clearly in­ scribed on them, together with the said thiee stripes mark, the word "Jonitexo", which is the trade name of the appellants; consequently, I am of the opinion that the injunction can still 35 serve fully the purpose for which it was granted, in accordance with section 32

(1)of Law 14/60, even if thereare excluded from its ambit goods such as the aforementioned. But. as my two 268 1 C.L.R. Jonitexo Ltd. \. Adidas Triaatafytlides P. learned brother Judges do not agree with me in this respect, the injunction should be allowed to stand as granted. Jn the light of all the foregoing thisappeal has to be dismissed with costs. 5 A. Loizou J.: I agree that this appeal should be dismissed with costs. The principles governing the exercise of a Court's discretion in granting or refusing an interlocutory injunction and those upon which a Court of Appeal will interfere with such exerciseofjudicial discretion, have beenexpounded in numerous 10 judgments of this Court byreference also to English cases on the subject and as the President of this Court has dealt elaborately with this aspect of the case, 1need not say anything on the subject. The point on which I cannot, however, find myself in agrce15 ment with the judgment of the President, are the observations made by him with regard to the extent of the interlocutory injunction given by the trial Judgeand hiscomments that it might beconsidered to cover awider rangethan it ought to and the use by the appellants of the word "Jonitexo", the name of their 20 Company, alongside with the stripes. In view of the determination of this point which touches the questions of reputation, imitation of get-up or part thereof and the proof of likelihood of deception which are the ingredients ot" the wrong of passing off, is so connected with the factual and 25 legal issues of the case and its merits that I feel compelled to refrain f.om saying anything and to exhibit the utmost caution out of fear that any pronouncement made, wh*.ndealing with an interlocutory injunction on appeal, might be misconstrued or tieated a:,prejudging any of theissuesthat have to be determined 30 at the trial. This approach is born out by a cursoiy glance at the law pertaining to the actionable wrong of passing off and its essential elements. In Cyprus this law is defined by section 35 of the Civil Wrongs Law, Cap. 148, a codification which has been 35 found not to be exhaustive however, hence the recouisc to the Common Law for a complete picture of it (UniversalAdvertising and Publishing Agency and Another v. Vouros, XIX C.L.R., P-87). 269 Λ. Loizou J. Jonitexo Ltd. \. Adidas

(1984)As legards certain of theabove issues, the position is summed upin Kerly's Law of Trade Marks &TradeNames, IOth Edition. In para. 16-02 it is stated that "it makes no difference whether the representation is effected by direct statements, or by using some of thebadges by which thegoods of theplaintiff are known 5 to be his, or any badges colourably resembling these, inconne­ ction with goods of the same kind, not being the goods of the plaintiff, in such a manneras tobe calculated to cause the goods to be taken by ordinary purchasers for thegoods of the plamtiff". And then "The question whether the use of particular words or 10 badges is calculated to pass off the defendant's goods as those of the plaintiff is often one of difficulty, but it is in substance a question of fact". Then in para. 16-68 it is said: "The relative importance to be attributed to names and word marks on the one hand, and to get-up on the other, isa matteruponwhich diffeient people have different view»; with the result that the outcome of disputes about get-up is exceptions1ly hard to predict.'* 15 Also in para. 16-69 reference is made to the case of Edge v.Nic- 20 colls [1911] A.C. 693, in which: "The plaintiffs sold bags of laundiy blue, each bag holding a stick or 'dolly' of a particular form. Theevidence showed that customers bought entirely by the appearance of the goods, relying in particular on the 'dolly*. The defendants adopted a similar dolly, and the presence on their goods of their name was in these ciicumstances held an insufficient distinction". Moreover, imitation of part of a get-up may be shown to be so identified with theplaintiff's goods that its use for similar goods is calculated topassing themoff as his (seeKerly's (supra),para. 16-71). 25 30 in conclusion Iwould liketopointoutthattheonusof proving deception is upon the plaintiffs and the question of likelihood of deception is for the Court (notthewitnesses) to decide "looking 35 at the documents and evidence before it" (see Spalding Bros. v. Gamage [1915] 32 R.P.C. 273, referred to in Kerly's (supra) page 425). 270 I C.L.H. Jonitexo Ltd. \. Adidas Λ. Loizou J. Indeed the learned trial Judge exhibited, after referring to the legal principles relevant to the issues raised before him caution by stating the following:5 10 "I believe it would be undesirable in the present case to endeavour to resolve on such evidence as has been adduced the factual disputes on which the result of the action will ultimately turn. Passing off cases very often pose difficult factual question*; in respect of which considerable evidence may be adduced to enable the Court to decide: see the comment of the Privy Council in Cadbury Schweppes Ltd. and Others v. Pub Squash Co. Ptv Ltd. [1981] I All E.R. 213". I fully share his attitude and Ihave afortioii on appeal acted likewise. 15 MALACHTOS, J.: I also agree that the appeal should be dis­ missed with costs without any modification of the order made by the trial Judge. I adopt the reasons given by my brother Judge Loizou on this issue. Appeal dismissed with costs. 271