FEDERAL COURT OF AUSTRALIA Winton Shire Council v Lomas [2002] FCA 696 TRADE MARKS – whether the services in Class 42 identified in the application, or some of them, constitute "the same kind of thing" as the services advertised under the name "Waltzing Matilda Country Kitchen" – Registrar's direction that application proceed to registration be affirmed, with amendments to the goods and services specified in the application COSTS – offer to settle the appeal on terms by the applicants – whether this offer justifies the grant of indemnity costs – applicants have not received more than their offer to settle hence indemnity costs are not justified – whether Court should exercise the discretion to order that the applicants are not entitled to all of their costs – applicants successful in respect of the real area of contention of the opposition and appeal proceedings WORDS & PHRASES – "the same kind of thing" Trade Marks Act 1995 (Cth), ss 56, 43, 44, 60, 58 Federal Court Rules, O 23 Hughes v Western Australian Cricket Association (Inc) & Ors (1986) 8 ATPR 40-748, applied Cretazzo v Lombardi (1975) 13 SASR 4, cited Mok v Minister for Immigration, Local Government and Ethnic Affairs & Anor (No 2) (1993) 47 FCR 81 WINTON SHIRE COUNCIL and THE WALTZING MATILDA CENTRE LIMITED v BRENDA MAURICEEN LOMAS No Q 92 of 2000 SPENDER J BRISBANE 31 MAY 2002 IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 92 OF 2000 BETWEEN: WINTON SHIRE COUNCIL FIRST APPLICANT THE WALTZING MATILDA CENTRE LIMITED SECOND APPLICANT AND: BRENDA MAURICEEN LOMAS RESPONDENT JUDGE: SPENDER J DATE OF ORDER: 31 MAY 2002 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. The appeal be allowed in part. 2. The Registrar's direction that the Application for Registration of Trade Mark Application Number 749100 proceed to registration be affirmed, but that the specification of goods of Classes 29 and 39 be amended to read: "Class 29: Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams, fruit sauces; eggs, milk and milk products; edible oils and fats; and foodstuffs in this class; Class 30: Coffee, tea, cocoa, sugar, rice, tapioca, sago, artificial coffee; flour and preparations made from cereals, bread, pastry and confectionery; biscuits and cakes; ices; honey, treacle; yeast, baking powders; salt, mustard, vinegar, sauces (condiments) spices and ice; and foodstuffs in this class;" and that the specification of services of Class 42 be deleted in their entirety. 3. The respondent should pay the costs of the applicants of and incidental to the appeal, including the costs of and incidental to the notice of motion of the respondent filed on 29 September 2000, and the applicants' costs of the opposition proceedings. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 92 OF 2000 BETWEEN: WINTON SHIRE COUNCIL FIRST APPLICANT THE WALTZING MATILDA CENTRE LIMITED SECOND APPLICANT AND: BRENDA MAURICEEN LOMAS RESPONDENT JUDGE: SPENDER J DATE: 31 MAY 2002 PLACE: BRISBANE REASONS FOR JUDGMENT 1 On 20 March 2002, I published my reasons for judgment in an appeal by the applicants pursuant to s 56 of the Trade Marks Act 1995 (Cth) (the Act) from their unsuccessful opposition to the registration of the trade mark "Waltzing Matilda" in respect of various goods and services covering goods and services specified in Classes 29, 30, 31, 35 and 42. 2 In those reasons, I found that the applicants had failed to make out the grounds of appeal based on ss 43, 44 and 60 of the Act. I found in respect of the ground of appeal based on s 58 that there had been a prior use of the mark "Waltzing Matilda" in respect of the supply of foodstuffs and restaurant services. When publishing my reasons concerning the appeal, I indicated that I would hear from the parties as to the form of the orders I should make in the light of those reasons and on the question of costs. 3 I have received extensive written submissions on both of those aspects of the matter, and these are the reasons for the orders that I make in those respects. 4 The respondent contends that in the light of the reasons published on 20 March 2002, the Court should order that the Registrar's direction that the application for registration of Australian Trade Mark Application Number 749100 proceed to registration be affirmed, but that the specification of goods of Classes 29 and 39 and the specification of services of Class 42 be amended by deleting "prepared foods" from Classes 29 and 39, and deleting from the services specified in Class 42: "… the establishment, operation and conduct of outlets, venues and facilities for the supplying and provision of meals and refreshments, including restaurants, cafes, food outlets, meal rooms, dining venues, eateries, cafeterias, canteens, snack bars, takeaway stores and fast-food outlets …" but retaining: "providing foodstuffs and beverages to the said outlets, venues and facilities for the supply and provision of meals and refreshments; catering services; advisory and consultancy services pertaining to the said services." 5 I accept the excision of "prepared foods" from the goods specified in Classes 29 and 39 of the application, but it seems to me that all of the services in Class 42 referred to in the opposed application should be deleted from registration. I am of the opinion that all of the services identified in Class 42 of the application constitute "the same kind of thing" as the services advertised under the name "Waltzing Matilda Country Kitchen". It seems to me that "providing foodstuffs and beverages to the said outlets, venues and facilities" and "catering services;" are sufficiently related to, or associated with, the services involved in the prior user as to be comprehended by the phrase "the same kind of thing". "Advisory and consultancy services" pertaining to the other services in Class 42 are a little further removed from, inter alia, the operation of restaurants, and their excision is more peripheral or marginal, but in the end I think they also should go. 6 I turn to the question of costs. The first matter to be considered on the question of costs is the fact that, pursuant to O 23 of the Federal Court Rules, the applicants, by written notice dated 19 February 2001, offered to settle the appeal with the respondent on terms as follows: "1. Pursuant to section 106(2) of the Trade Marks Act 1995, the Respondent makes a partial assignment of Australian Trade Mark number 749 100 to the Second Applicant in respect of all services claimed in Class 42 and all retail and wholesale services claimed in Class 35 ('Assigned Application'). 2. The Respondent remains the applicant for registration of Australian Trade Mark number 749100 in respect of all goods claimed in Classes 29, 30 and 31 and all other services, except retail and wholesale services, claimed in Class 35 ('Application'). 3. Subject to the Assigned Application proceeding to registration, the Second Applicant agrees to licence the Respondent to use the mark the subject of the Assigned Application, and to sublicence others to use that mark, in respect of the services specified in Class 42 and in respect of retail and wholesale services. Any use by the Respondent under that licence will be royalty free. However, the Second Applicant will be entitled to a royalty, the amount of which is to be agreed, for any use by sub-licensees. That licence may be subject to conditions in relation to the use of the mark, how it is to be represented and contain quality control provisions. 4. Subject to the Application proceeding to registration, the Respondent agrees to licence the Second Applicant to use the mark the subject of the Application on all of the goods specified in Classes 29, 30 and 31. That licence will be royalty free. That licence may be subject to conditions in relation to the use of the mark, how it is to be represented and contain quality control provisions. 5. The parties agree to give each other all reasonable assistance in relation to the opposition proceedings against registration of the Application and the Assigned Application (if any) by Jolly Swagmen Pty Ltd. 6. The parties agree to give each other all reasonable assistance in relation to the removal proceedings brought by each of them seeking removal of Australian registered trade marks numbers 218783 and 228232, registered in the name of Jolly Swagmen Pty Ltd. 7. The appeal is dismissed." 7 In my opinion, the making of this offer does not justify the grant of indemnity costs subsequent to 19 February 2002. What the applicants sought to obtain by the acceptance of the offer is more than what flows from the orders which I am prepared to make. Amongst other considerations, in my opinion the respondent remains entitled to registration of the mark "Waltzing Matilda" in respect of the services identified in Class 35 of the application by the respondent. The applicants have not received more than their offer to settle and are not therefore, in my opinion, entitled to indemnity costs from the date of the offer or from fourteen days after the making of the offer. 8 On the more general question of the appropriate order to be made as to the costs of the appeal and of the opposition proceedings, the applicants have been successful in the appeal in respect of the central aspect of the opposition and appeal proceedings, namely the use of the mark "Waltzing Matilda" in relation to the provision of restaurant services. The applicants failed in respect of three of the four bases for opposition to registration of the mark. 9 The general position in relation to costs was summarised by Toohey J in Hughes v Western Australian Cricket Association (Inc) & Ors (1986) 8 ATPR 40-748 where his Honour summarised the effect of decisions of Australian and English courts on the exercise of the discretion in respect of the awarding of costs and said at 48,136: "1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. Ritter v Godfrey (1920) 2 KB 47. 2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. Forster v Farquhar (1893) 1 QB 564. 3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party's costs of them. In this sense, 'issue' does not mean a precise issue in the technical pleading sense, but any disputed question of fact or law. Cretazzo v Lombardi (1975) 13 SASR 4 at 12." 10 In Cretazzo v Lombardi (supra), Jacobs J said at 16: "But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues." 11 In respect of the question of the pursuit of unsuccessful bases for an order which was granted on another basis, Keely J said in Mok v Minister for Immigration, Local Government and Ethnic Affairs & Anor (No 2) (1993) 47 FCR 81 at 84: "[T]he Court's power to order a successful applicant to pay the costs in respect of an issue raised by the applicant, on which the applicant has failed, ought to be exercised only where the Court, on a consideration of all the circumstances, has concluded the raising of that issue by the applicant was so unreasonable that it is fair and just to make the order. In expressing that opinion I am of course, not attempting to fetter in any way the judicial discretion of the Court." 12 The applicants have succeeded in respect of part of their claim, but that part was in fact the real area of contention between the parties. Even though that success is based on the narrowest of circumstances, I do not think the Court should exercise the discretion it has to order that the applicants are not entitled to their costs of the proceedings so as to deprive them of a part of the costs of the litigation, and similarly, I do not think it appropriate to exercise the discretion as to costs of the opposition proceedings in such a way as to deprive the applicants of part of the costs of those opposition proceedings. 13 For the above reasons, I make the following orders: 1. The appeal be allowed in part. 2. The Registrar's direction that the Application for Registration of Trade Mark Application Number 749100 proceed to registration be affirmed, but that the specification of goods of Classes 29 and 39 be amended to read: "Class 29: Meat, fish, poultry and game; meat extracts; preserved, dried and cooked fruits and vegetables; jellies, jams, fruit sauces; eggs, milk and milk products; edible oils and fats; and foodstuffs in this class; Class 30: Coffee, tea, cocoa, sugar, rice, tapioca, sago, artificial coffee; flour and preparations made from cereals, bread, pastry and confectionery; biscuits and cakes; ices; honey, treacle; yeast, baking powders; salt, mustard, vinegar, sauces (condiments) spices and ice; and foodstuffs in this class;" and that the specification of services of Class 42 be deleted in their entirety. 3. The respondent should pay the costs of the applicants of and incidental to the appeal, including the costs of and incidental to the notice of motion of the respondent filed on 29 September 2000, and the applicants' costs of the opposition proceedings. I certify that the preceding thirteen (13) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender. Associate: Dated: 31 May 2002 Counsel for the Applicant: Mr A. Musgrave Solicitor for the Applicant: Deacons Lawyers Counsel for the Respondent: Mrs C. Champion Solicitor for the Respondent: John Spence & Associates Date of Judgment: 31 May 2002