Reported Decision : 60 IPR 367 New South Wales Court of Appeal CITATION : Southdown Publications Pty. Ltd. & Ors. v. ACP Magazines Pty. Ltd. [2003] NSWCA 347 HEARING DATE(S) : 23 September 2003 JUDGMENT DATE : 26 November 2003 JUDGMENT OF : Spigelman CJ at 1; Sheller JA at 14; Hodgson JA at 15 DECISION : 1. Appeal dismissed with costs. 2. Cross-claim dismissed. CATCHWORDS : CONTRACT - Construction and interpretation - Whether "rights" referred to in a contract relating to a magazine were limited to the name of the magazine, or extended to the business of publishing the magazine and/or awards associated with the magazine. - TRUST - Trade marks - Application for registration - By reason of mistake, application made in name of entity different from that which had used mark and which was entitled to it - Whether intention to obtain registration for entity which had used mark and was entitled to it predominated over intention to obtain registration for named entity - Whether trust should be implied. Federal Commissioner of Taxation v. Murry (1998) 193 CLR 605 Ingram v. Little [1961] 1 QB 31 CASES CITED : Papas v. Bianco Investments Pty. Ltd. (2002) 82 SASR 581 Phillips v. Brooks Ltd. [1919] 2 KB 243 Porter v. Latec Finance (Qld) Pty. Ltd. (1964) 111 CLR 177 Southdown Publications Pty. Ltd. - first appellant PARTIES : Pacific Publications Pty. Ltd. - second appellant Jupelly Pty. Ltd. - third appellant ACP Magazines Pty. Ltd. - respondent FILE NUMBER(S) : CA 40411/03 COUNSEL : Mr. S. Finch SC with Mr. C. Moore for appellants Mr. A. Meagher SC with Ms. K. Richardson for responent SOLICITORS : Coudert Brothers, Sydney for appellants Gilbert & Tobin, Sydney for respondent LOWER COURT Supreme Court - Equity Division JURISDICTION : LOWER COURT ED50130/02 FILE NUMBER(S) : LOWER COURT McClellan J JUDICIAL OFFICER : IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40411/03 ED 50130/02 SPIGELMAN CJ SHELLER JA HODGSON JA Wednesday 26 November 2003 SOUTHDOWN PUBLICATIONS PTY LTD & ORS V. ACP MAGAZINES PTY LTD HEADNOTE FACTS: In August 1980, Australian Consolidated Press (ACP), News Limited (News) and Southdown Publications Pty Ltd (Southdown 123), a subsidiary of News, agreed to merge the businesses of publishing TV Times, TV Guide and TV Week. That agreement was made by a deed dated 6 August 1980 (1980 deed). The deed stated that News or Southdown 123 would continue to "publish, edit, produce and distribute" TV Week. It was also agreed that News and ACP would share equally in the profits and bear equally the losses from that activity. At that time the conduct of the Logie television awards was associated with the business of publishing TV Week. Clause 7 of the 1980 deed, called the Savoy Clause, outlined that each party could acquire the "interest" of the other under the deed. The clause specified that if ACP or News offered to sell to the other party their interest in the magazine for a specified sum, and if that offer was not accepted, the offeree party would be bound to sell to the offeror their interest for the same specified amount. By 2002, the successor to the rights and obligations of News and Southdown 123 under the 1980 deed was Southdown Publications Pty Ltd (Southdown 266). Jupelly Pty Ltd (Jupelly), a holding company for Channel 7 Television Network interests, acquired the shares in Southdown 266, which in turn owned Pacific Publications Limited (Pacific 896). Pacific 896 was the registered owner of trade marks associated with the Logie awards. The successor to the 1980 deed rights of ACP was ACP Magazines Pty Ltd (ACP Magazines). On 14 March 2002, ACP Magazines, Southdown 266, Pacific 896, and Jupelly entered into a deed of Settlement and Release (2002 deed) in order to settle a dispute between the parties about the 1980 deed. Clause 4.9 of the 2002 deed provided that Pacific 896 and Jupelly would do all things necessary to ensure Southdown 266 complied with its obligations under the 1980 deed. On 19 June 2002, ACP Magazines offered, under cl.7 of 1980 deed, to sell its interest to Southdown 266 for $60m. Southdown 266 declined to accept that offer. In July 2002, as a consequence of the rejection of the ACP Magazines offer, ACP Magazines acquired the magazine TV Week from Southdown 266 for the same amount. To give effect to that acquisition, Southdown 266 assigned the name TV Week and associated marks to ACP magazines, and Pacific 869 also assigned certain material, but they refused to assign rights associated with the Logie awards including trade marks and a photographic library associated with the awards. ACP commenced proceedings in the court below to acquire those rights. The central issue in the dispute concerned which rights passed with the acquisition, namely whether ACP acquired only the "mast head" TV Week, or acquired also the rights to the Logie awards, trade marks, and photographic library. The primary judge made orders disposing of the proceedings brought by ACP Magazines and made two relevant findings. Firstly, that upon its proper construction clause 7 obliged Southdown 266 to assign to ACP Magazines the assets of the business of publishing TV Week, which included the Logie trade marks, and the Logie photographic library. Secondly, that Pacific 896, as registered proprietor of the Logie trade marks, was required by clause 4.9 of the 2002 deed to ensure that Southdown 266 complied with its obligations under the 1980 deed, including assigning those marks to ACP magazines. It was these findings that were the subject of the appeal. HELD: 1. The evidence was sufficient to support a finding that, at the time of entry into the 1980 deed, Southdown 123 owned the business of TV Week, and the conduct of the Logie awards was an integral part of that business. The rights associated with the use of the Logie name, including the right to have the benefit of this use protected by passing-off proceedings, were rights of Southdown 123. 2. The trial judge was correct in determining that the interests of News dealt with by clause 7 of the 1980 deed included the conduct of the Logie awards and the use of the Logie name, for the following reasons: (a) The structure of the 1980 deed showed it was intended that the business of TV Week would continue to operate in the same way both before and after the acquisition, with the conduct of the Logie awards being an integral part of the business. (b) Clause 9(a) and Recital B of the 1980 deed confirmed that this interest must be taken as extending to all the rights which were sufficient for the publication of the magazine in the manner and with the features that the publication did in fact have, including the use of the name Logie. (c) Clause 7 of the 1980 deed proceeded on the assumption that the rights of each party to the business were equal, which confirmed that the rights of either party contributing to the success of the business should be treated as assets of the business, and as part of the interest of the party under the agreement. 3. The trial judge was correct to hold that, in a situation where trade mark applications were applied for by one company, but in substance the intention manifested was that the application and granting of registration be done as an agent for a second company, even if this was not the clear subjective intention of the participants, a trust could be implied in favour of the second company. 4. In situations where legal consequences attach to intentions but intentions are inconsistent because of mistake or misapprehensions, the appropriate test is to determine which intention can reasonably be regarded as predominating over the inconsistent intentions. 5. The trial judge was correct in determining that the proper construction of clause 4.9 of the 2002 deed was for Pacific 896 to do all things necessary and provide all assistance to ensure Southdown 266 complied with its obligations under the 1980 deed, and therefore Pacific 896 had to give an outright transfer of the marks. ********** IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40411/03 ED 50130/02 SPIGELMAN CJ SHELLER JA HODGSON JA Wednesday 26 November 2003 SOUTHDOWN PUBLICATIONS PTY. LIMITED & ORS. V. ACP MAGAZINES PTY. LIMITED Judgment 1 SPIGELMAN CJ: In this matter I have had the advantage of reading the judgment of Hodgson JA in draft. I agree with his Honour's reasons, with the following additional observations. 2 His Honour rejects the Appellant's proposed restrictive construction of the 1980 deed in reliance on the terms of Recital B of that deed, which defined "News Rights" as those rights which "permit [it] to publish and are sufficient for the publication of the magazine called 'TV Week'". Hodgson JA refers to the significance of cl 9(a), together with the structure of the agreement and the terms of the Savoy clause, as indicating that a restrictive construction of the terminology "permit" and "sufficient" is not appropriate. I agree with his Honour's reasons and add the following two additional reasons for this conclusion. 3 Recital B uses the definite article "the" when identifying the magazine "TV Week". The use of the definite article is further reinforced by the terms of cl 2.1, which Hodgson JA sets out in full, and which, relevantly, refers to an obligation on the part of News to "continue to publish, edit, produce and distribute the magazine presently called 'TV Week'." The focus of attention is not on the publication of a television guide, but on the particular publication then produced and published by News and known as "TV Week". What is involved is the continuation of an existing magazine and business of a particular character, not a magazine of a particular title. 4 On the findings of fact of the trial judge, the Logies had become an integral part of the publication and promotion of that particular magazine. Accordingly, the continued use of the Logies as a promotional mechanism was such as 'permitted' and was 'sufficient' for the publication of the specific magazine "TV Week", as it existed in 1980 and thereafter. 5 An additional reason for rejecting the Appellant's submissions in this respect is that it approaches the proper construction of the Savoy clause without tracing through the relevant definitions in the correct sequence. It is not appropriate to construe the Savoy clause as if it contained a reference to "the News Rights" set out and defined in Recital B. 6 Clause 7.2 identifies the "interest" of News which would be transferred under the operation of the clause as being "the Rights". That terminology is defined in cl 1.2 to mean "the ACP Rights and the News Rights merged" in the business, as referred to in cl 1.1 and cl 2. One cannot read the definition of the "News Rights" from Recital B into cl 7.2, and therefore into cl 7.1. This is the entire foundation of the Appellant's argument in this respect. Those "Rights" are transformed in the manner for which cll 1.1, 1.2 and 2.1 provide. There is no scope for a restrictive interpretation of the original "News Rights". They had merged in the business. This, of course, is reinforced by the particular terms of cl 9(a) to which Hodgson JA refers. 7 The above analysis is also sufficient to dispose of the Appellant's separate appeal with respect to the photographic library. However, in view of the commercial significance of that library, I wish to add some observations to the judgment of Hodgson JA. 8 The orders made by the trial judge declared that the Respondent was entitled to the benefit of any licence of copyright for the use of the "TV Week Photographic Library" and the title of any photographs constituting that Library. That Library included certain photographs referred to as the "Logies Photographs". In the orders made, each of these terms was defined in terms of photographs "which are reasonably capable of being identified as" photographs taken for the purposes of use in "TV Week Magazine" or as having been taken at the Logie Awards. 9 His Honour made an express finding of fact that the photographs taken for the purposes of producing "TV Week" were a "unique collection" and that they formed "part of the assets of the magazine business". He found that, even after some reorganisation of the library of photographs, "there remains a separate body of exclusive photographs which are an asset of the 'TV Week' business". His Honour found that the intellectual property in the Photographic Library passed under the Savoy clause. 10 His Honour was correct in that conclusion. To apply the above analysis of the proper construction of the 1980 deed to the specific assets: The separate Photographic Library as at 1980 was within the "other rights" which 'permitted' and were 'sufficient for' the publication by News of the particular magazine called "TV Week" as at that date. Those photographs were amongst the rights merged in the business within the meaning of cl 1.2 and accordingly became "the Rights" in cl 7.2. The photographs were the rights "used or required in connection with or for the purpose of the publication of TV Week" within cl 9(a). The use of the word "rights" in this clause distinguishes assets in the intangible form of the right of copyright from other assets of News that were partially used for the purposes of production, e.g. printing presses, which were not transferred. The reduction of such intellectual property to the physical form of an actual print of a photograph is, in my opinion, within the concept of "rights" as used in this clause, even though, in some respects, they may have been regarded as a physical asset. 11 Subsequent additions to the Photographic Library were brought into existence for purposes of the merged business and, thereupon, fell within the definition of the "Rights" in cl 1.2 and cl 7.2. Accordingly, they were transferred upon the operation of the Savoy clause. 12 Insofar as any further requirement to ensure that the obligations under this clause are complied with is required for the particular Appellants, it is supplied by cl 4.9 of the 2002 Deed of Settlement which is set out by Hodgson JA. 13 I agree with the orders proposed by Hodgson JA. 14 SHELLER JA: I have had the benefit of reading the reasons for judgment of the Chief Justice and Hodgson JA. For the reasons given by Hodgson JA I agree with the orders he proposes. I agree also with the additional observations made by the Chief Justice. 15 HODGSON JA: On 20 December 2002 and 14 May 2003, McClellan J made orders disposing of proceedings brought by ACP Magazines Pty. Limited ("ACP Magazines") against Southdown Publications Pty. Limited ("Southdown 266"), Pacific Publications Pty. Limited ("Pacific 896"), PMP Publishing Pty. Limited ("Pacific 878") and Jupelly Pty Limited ("Jupelly"), and a cross-claim in those proceedings brought by Pacific 896 against ACP Magazines and ACP Publishing Pty. Limited ("ACP Publishing"). In substance, the primary judge: (1) declared that ACP Magazines was entitled to certain trademarks, business names and photographs associated with the television awards known as the Logie awards; (2) made consequential orders; (3) ordered Southdown 266, Pacific 896 and Jupelly to pay ACP Magazines' costs; (4) ordered ACP Magazines to pay Pacific 878's costs; and (5) ordered that ACP Magazines' summons otherwise be dismissed. 16 There does not appear to be any actual order dismissing the cross-claim; but that was the effect of the primary judge's decision. I believe it is common ground that it would be appropriate for this Court to make such an order to make it clear that the cross-claim is at an end. 17 Southdown 266, Pacific 896 and Jupelly appeal to this Court from those orders. OUTLINE OF CIRCUMSTANCES 18 In 1958, a magazine titled "TV Radio Week" commenced to be published by a company then called Southdown Press Pty. Limited ("Southdown 123"). This company was a wholly owned subsidiary of News Limited ("News") and it published a number of magazines. It changed its name to Southdown Publications Pty. Limited in about April 1969, and changed its name again in about October 1991 when Southdown 266 adopted the name Southdown Publications Pty. Limited; and it is now de-registered. The magazine commenced in 1958 soon changed its name to "TV Week". 19 In January 1959 TV Week announced a proposal for a series of television awards to be known as the TV Week awards. Graham Kennedy, then already a well-known television personality, received an award which he referred to as a Logie; and that name was used thereafter in relation to these awards. The recipient of such an award received and continues to receive a statuette known as a Logie. 20 This award continued to be given annually. The award ceremony was first broadcast on national television in 1968, and it has been so broadcast ever since. The significance of the awards increased progressively. 21 In 1969, as part of a restructure of the corporate interests of News, Downland Publications Limited (UK) ("Downland") became the owner and publisher under the business name Southdown Press of a number of magazines previously published by Southdown 123. However, according to a finding of the primary judge, TV Week continued to be owned and published by Southdown 123, although it was "edited, printed and distributed" by Downland. The personnel involved in the publication of TV Week were employees of Downland, and the equipment, such as printing presses, used in that publication, was owned by Downland. However, the expenses of publishing TV Week, including the salaries of employees engaged in the publication of TV Week and a proportion of salaries of other employees and of the cost of equipment, were treated as expenses of Southdown 123. 22 As regards the costs and receipts involved in the conduct of the Logie awards, including costs associated with bringing overseas personalities to Australia for awards ceremonies, these were included as expenses of Southdown 123. The primary judge found that conduct of these awards contributed substantially to the commercial success of TV Week, and that there was no business of conducting these awards which was separate from the business of publishing TV Week. The primary judge accepted that the Logie awards also benefited other magazines published by Downland, but held that this was a minor and incidental matter, and that the awards were predominantly managed to advance the commercial success of TV Week. 23 Prior to 1980, Australian Consolidated Press Limited ("ACP"), the corporate vehicle of the Channel 9 Television Network, created two magazines related to the television industry, namely TV Times and TV Guide. 24 On 6 August 1980, ACP, News and Southdown 123 entered into a deed, which is central to the determination of this case. 25 The deed contains the following recitals: A. ACP is entitled to all of the goodwill trademarks business names and other rights (hereinafter called "the ACP Rights") which permit it to publish and are sufficient for the publication of the magazine called "TV Times" and "TV Guide". B. News and/or Southdown are entitled to all of the goodwill trademarks business names and other rights (hereinafter called "the News Rights") which permit it to publish and are sufficient for the publication of the magazine called "TV Week". C. "TV Week" is edited, printed and distributed for Southdown by Downland Publications Limited ("Downlands") a company duly incorporated in the United Kingdom and registered as a foreign company in the State of Victoria with its registered office in Victoria situate at 32 Walsh Street, Melbourne. D. ACP has agreed to sell to News and News has agreed to buy from ACP the ACP Rights for the consideration and on and subject to the terms and conditions hereinafter set forth. 26 Clause 1 of the deed is entitled "Sale of the ACP Rights". Clauses 1.1, 1.2 and 1.5 provide as follows: 1.1 ACP shall sell to News and News shall acquire the ACP Rights which shall vest in News on the execution of this Deed. The ACP Right (sic) and the News Rights shall thereupon be merged in the business referred to in Clause 2 (hereinfater (sic) called "the business"). 1.2 The ACP Rights and the News Rights merged as aforesaid are hereinafter referred to as "the Rights". 1.5 Each of News and Southdown will not without the prior written consent of ACP do or attempt or purport to do, or permit, cause or suffer to be done, anything which may materially prejudice the validity, subsistence or good standing of the Rights of any of them. 27 Clause 2 is entitled "The Business", and provides as follows: 2.1 Subject to this Deed, News or Southdown shall continue to publish edit produce and distribute the magazine presently called "TV Week" or arrange for that to be done but under the title of "TV Week incorporating TV Times and TV Guide" (which title is hereinafter called "the new title" and which magazine under the new title is hereinafter called "the magazine"). 2.2 The first issue of the magazine shall be that dated 23 August, 1980 (hereinafter called "the first issue"). 28 Clause 3 is entitled "Share of Profits and adjustment for Losses", and provides as follows: 3.1 News shall pay or cause to be paid to ACP as hereinafter provided an amount equal to one half of the net profits (before tax) from the magazine as from and including the first issue or ACP shall pay to News an amount equal to one half of the net loss, as the case may require. Payment shall be made as follows: (a) the net profit or loss from the issues of the magazine published for each quarter (or from the first issue onwards) shall be calculated as at the end of each September, December, March and June and if there is a profit News shall pay or cause to be paid to ACP an amount equal to one half of such profit within 45 days of the last day of that September, December, March or within 60 days of the last day of June PROVIDED THAT ACP shall not contribute in respect of the net loss for any quarter except as provided in sub-clause (b) of this clause; (b) as at the end of June of each year the net profit (before tax) or loss from the issues of the magazine published in the four preceding quarters shall be calculated and News shall pay to ACP or ACP shall pay to News (as the case may be) such amount (if any) (hereinafter called "the adjustment payment") so that ACP and News shall each have received one half of the net profits (before tax) for that financial year or contributed one half of the amount of the net loss (as the case may be) of such period. 3.2 The adjustment payment shall be made within sixty (60) days of the last day of June of each year. 3.3 In arriving at the net profit or net loss referred to in Clause 3.1 News and Southdown shall at all times and in all respects act justly and fairly and exhibit proper and just regard to the interests of ACP. 29 Clause 4 is entitled "Management and Control". Clauses 4.1, 4.2 and 4.3 provide as follows: 4.1 News or Southdown shall continue to have full control and the sole and exclusive management as against ACP of all operations relating to the Business. 4.2 ACP shall not take nor be entitled to take any part in or in any way interfere in the conduct or management of the Business. 4.3 News or Southdown shall continue to supply and provide or arrange dor the supply and provision of all facilities necessary to permit the Business to be carried on. 30 Clause 5 is entitled "Accounts" and provides as follows: News shall keep or cause to be kept proper books of account and other records of all the transactions relating to the Business which accounts and records shall be kept by or under the supervision of News. Such books of account, records, correspondence and other relevant documents shall be at all reasonable times made available by the Chief Executive for the time being of News for inspection by the Chairman for the time being of ACP or his nominee at a place which is reasonably accessible to the said Chairman PROVIDED HOWEVER that a person nominated by the Chief Executive for the time being of News shall be entitled to be present at all times during the said inspection. 31 Clause 6 is entitled "Maintenance of the Rights". Clause 6.1 provides as follows: 6.1 News undertakes and agrees that it will at all times take all necessary steps to maintain the Rights in good standing and to protect the same. 32 Clause 7 is the clause which is crucial for these proceedings. It is entitled "Savoy Clause", and it provides as follows: 7.1 Either News or ACP (hereinafter called "the offeror party") may at any time after the date six months from the date of this Deed offer in writing to sell or procure the sale to the other party (hereinafter called "the offeree party") the offeror party's interest under this Deed for the sum of money specified by the offeror party in the said offer. If the offeree party shall not have accepted the offer by giving notice in writing within fourteen (14) days after the making of the offer the offeror party shall thereupon be deemed to have notified the offeree party that the offeror party will purchase from the offeree party all of the offeree party's interest under this Deed for the sum specified in the offeror party's original offer and the offeree party shall in that case be bound to sell to the offeror party. Completion of any sale or purchase pursuant to this Clause 7 shall take place within twenty-one (21) days after acceptance of the offer by the offeree party or the deemed notice by the offeror party as the case may be, and this Deed shall subject to Clause 7.3 cease to operate. 7.2 In this Clause 7 any reference to the interest of any party under this Deed shall mean in the case of ACP the right to receive the share of the net profits of the Business as provided in Clause 3.1 and shall mean in the case of News the right title and interest of News in and to the Rights including (but without limiting the generality of the foregoing) in respect of the new title and of each of the separate titles "TV Week", "TV Times" and "TV Guide" and of the goodwill attached to any or all of those titles. 7.3 If pursuant to an exercise of the Savoy Clause the purchaser is ACP and ACP shall continue publication of the magazine then for a period of one (1) year from completion (or such lesser period as publication continues) Downlands or News of a related corporation of News (as News may nominate prior to completion and from time to time) shall be engaged by ACP to print and bind the magazine for a price that is no more than that which would otherwise be generally available to ACP from other printers for the printing and binding of a similar magazine in similar quantities. 33 Clause 8 is entitled "No Restraint on Competition", and provides as follows: Nothing in this Deed or in the relationship between the parties resulting from the Deed is to prevent any party in any way from carrying on any business or publishing any magazine in competition with the magazine (howsoever called) and in particular (but without limiting the generality) nothing is to prevent ACP from continuing to publish the TV magazine presently published by it in connection with "The Australian Women's Weekly". 34 Clause 9 is entitled "Warranties and Conditions". Most relevant to this case is paragraph (a), which is in the following terms: News and Southdown jointly and severally warrant to ACP and ACP warrants to News and Southdown that to the best of each party's knowledge:- (a) there are no rights held owned used or required in connection with or for the purpose of the publication of (in the case of ACP) "TV Times" and "TV Guide" or (in the case of News and/or Southdown) "TV Week" which are not the subject of this Deed; 35 Clause 11 is entitled "Neither Party to Assign, Encumber, etc.", and provides as follows: Neither this Deed nor the interest of any of the parties in to or arising under this Deed (or any part thereof) herein may be assigned, pledged, transferred or encumbered or any equity therein conferred without the prior written consent of both the other parties. 36 Clause 13 is entitled "Further Assurance", and provides as follows: The parties agree that they will at any time after completion when and if requested by any other party so to do execute all such instruments and do all such things as shall be reasonably required by the other party more effectively to vest in and secure to that party its full and unencumbered interest in and benefit of this Deed. 37 Clause 17 provides that "clause headings shall in no way affect the meaning, construction or interpretation of this Deed". 38 Clause 19 is entitled "Interpretation", and paragraphs (a)-(e) provide as follows: In this Deed unless the context shall otherwise require:- (a) "ACP" means ACP and shall extend to include its successors and assigns; (b) "News" means News and shall extend to include its successors and assigns; (c) "Southdown" means Southdown and shall extend to and involve its successors and assigns; (d) "parties" or "party" means the signatories to this Deed and the respective successors and permitted assigns; (e) "related corporation" means a related corporation within the meaning of the Companies Act, 1961 (as amended); 39 As contemplated by the deed, Southdown 123 continued to publish TV Week, and the separate publication of TV Times and TV Guide ceased. ACP received one-half the net profits of TV Week as and from the issue of 23 August 1980. It appears that both before and after the deed, such profits took into account both expenses and receipts associated with the conduct of the Logie awards. 40 In 1984, News undertook further corporate re-structuring. Downland assigned its Southdown Press magazine business to Nationwide News Pty. Limited ("Nationwide News"), a wholly owned subsidiary of News. However, according to findings by the primary judge, ownership of TV Week remained with Southdown 123. 41 In July 1985, Southdown 123 became the applicant for a trade mark in respect of the TV Week logo; and that mark and other TV Week marks were subsequently registered in the name of Southdown 123. 42 As regards trade marks concerning the Logie awards, Southdown 123 had applied to register Logie word marks on 21 February 1979, but these applications were not pursued and lapsed on 17 December 1981. The matter was re-agitated in 1989, and it is necessary to set out some of the relevant documents. 43 On 26 September 1989, solicitors acting for the News group wrote to "Southdown Press" for the attention of the Chief Editor of TV Week, in the following terms: We refer to the above matter and confirm that our Patent Attorneys, Davies and Collison, are proceeding towards the registration of the Logie trademark. It is hoped that we can obtain registration both of the depiction of the Logie statuette, together with the name "Logie" or "Logie Award". The Patent Attorneys have however, asked us to find out certain further information to assist them in drawing the applications. We would be pleased if you would be able to provide us with details in response to the following questions:- 1. How long has the Logie been in use by T.V. Week? 2. Is the statuette designed to depict anything in particular, and if so what or who? 3. Who first designed and created the statuette? Was it an employee of Southdown Press? Was it commissioned to be created for Southdown Press under contact, and if so did the terms of that contact provide Southdown with exclusive ownership rights? 4. Who first conceived the idea of the statuette and awards, and what connection did that person have with Southdown Press? 5. In what year were the Logie Awards first presented? 6. Can you confirm that John Logie Baird is now dead? Our patent Attorneys have indicated that the cost of registration of a mark is approximately $600.00 to $700.00 per mark per class group in which the mark is registered. Also, they have indicated that the cost would be approximately $150.00 to $200.00 more in each case to register the mark in New Zealand. While some of the categories are not necessarily exclusive by description, in view of the cost we propose to instruct Davies and Collison to register the marks in categories appropriate to both entertainment services and magazines, newspapers and periodicals etc. If you have any other proposed use in mind for the mark, however, we would be pleased if you would advise us so that we may consider whether other categories may also be appropriate. 44 On the same day, those solicitors wrote to patent attorneys, in the following terms:- We refer to the above matter and confirm our telephone discussion with you on 21st September, 1989. We confirm that we act for Southdown Press Pty. Ltd. which is the publisher of T.V. Week magazine, and we have been instructed to engage your services with a view towards registration of trademarks in connection with the T.V. Week Logie awards. We enclose for your information a series of photographs of the "Logie" statuette. By way of background we also provide the following information. In the early days of television the then Managing Director of Southdown Press and the editor of T.V. Week decided that achievements on television should be recognised by a system of awards. The award eventually took the form of a Logie which was named in honour of a Scottish gentlemen know (sic) as John Logie Baird, the inventor of television. The first awards were presented during an edition of In Melbourne Tonight. The awards have now developed into a major event in the television calendar and a matter of great prestige to the industry. The awards are more particularly known as the T.V. Week Logie Awards, and are intimately concerned with the weekly magazine T.V. Week. In other words, the awards are sponsored and indeed presented by T.V. Week which is a publication of Nationwide News Pty. Ltd., which trades under the name Southdown Press. The statuette itself carries the words "T.V. Week" on a television shaped object held by the figurine. (If we are to register the shape of the award itself, it would not be intended to include the T.V. Week name among the design). The annual Logie Awards are widely promoted by Southdown Press and on the various television networks. The figurine and the concept of the Logie Awards are widely identified in the industry and the viewing public with the T.V. Week magazine. In issues of the magazine leading up to the awards, there is a great deal of promotion and the magazine issues contain voting coupons relating to the "most popular" awards. The awards are telecast each year (on one or the other network) and the name and image of T.V. Week is emphasized during the telecast. Indeed, a special preview of the cover of the issue released immediately after the awards is usually shown during the telecast, containing photographs of the major award winners. There is no doubt that the T. V. Week Logie Awards is a major marketing and promotional advantage to Southdown Press. There is also no doubt that the public would identify the Logie Awards distinctively with T. V. Week magazine. We are currently in the process of seeking further information from Southdown Press concerning the authorship of the Logie Award concept, name and figurine. We are also seeking more precise details as to the length of time the Logie has been in use by Southdown Press. Our instructions are to seek as far as possible to register trademarks consisting of the Logie statuette appearance and the name "Logie" or "Logie Awards". While our client would like a broad coverage in the categories of registration, in view of the cost concerned we suggest that registration be confined to categories relating to entertainment services and printed materials such as magazines, newspapers and periodicals. We are also seeking firm instructions from our client on the question as to whether to seek identical registration in New Zealand. We would be pleased if you would advise us as to what further information you require to enable you to draw the necessary application for registration. 45 On 2 October 1989, there was a telephone conversation between the relevant patent attorney and the relevant solicitor, noted as follows by the solicitor:- – Wanted to know which coy we want application made for Southdown Press P/L? – I/S Nationwide News P/L is the publisher stick to them. Southdown Press = trading name. – S/D Press P/L change name to S/D Publications but is only jointly involved in TV Week with Nationwide news. – Go ahead with Nationwide News P/L. – Don't need any further info yet. Stevens will be responding to our letter. 46 The patent attorneys then wrote on the same day to the solicitors in the following terms:- Thank you for your letter of 26th September, 1989. Following our recent telephone discussions regarding the trade marks LOGIE and Logie silhouette, we undertook a preliminary check of the Trade Marks register to ascertain whether the word LOGIE or the silhouette device are registered or applied for as trade marks in respect of printed publications and entertainment services. The search has revealed no prior registrations or applications for these trade marks although our search has revealed two earlier applications by Southdown Publications Pty. Ltd. for the trade mark LOGIE. These applications were filed in 1979 and were allowed to lapse, possibly on account of official objections based on the surname significance of the word LOGIE. Copies of the lapsed applications are attached for your information. The surname is listed 115 times on the Australian electoral rolls and, for purposes of overcoming the objection, it will be necessary to compile evidence of the use of the trade mark to show that the mark is now distinctive of your client. We shall advise you further in this regard at the appropriate time. Your attention is also drawn to the existence of copyright which may vest in the Logie silhouette. This reight (sic) exists separately from any trade mark rights and does not require registration in order to be enforceable. Given the advantages which arise from copyright, we recommend that your client take steps to ensure that it acquires property in any copyright to the artistic work featured in the label. For purposes of safeguarding your client's trade mark rights we are now proceeding with applications for registration of the trade mark LOGIE and the trade mark Logie silhouette in relation to goods in Class 16 (printed matter, periodicals, etc.) and services in Class 41 (entertainment services). Full details of the applications will be forwarded to you shortly. 47 On the same day, the patent attorneys filed applications for trade mark registrations in which it was asserted in relation to each mark:- Nationwide News Pty. Limited, a company incorporated in the Australian Capital Territory, Commonwealth of Australia, of 32 Walsh Street, West Melbourne, Victoria, 3003, Australia, the proprietor of the trade mark, a representation of which is affixed to the Schedule of this application, hereby applies for registration of a trademark … 48 On 31 October 1989, on the letterhead of "Southdown Press", the editor of TV Week replied to the solicitor's letter of 26 September 1989 as follows: These are answers to the questions you raised in your letter of September 26, 1989: 1. 31 years. 2. It is a modular image of the human form, depicted holding the TV Week logo. 3. It was designed by Mr. Alec De Lacy, chief designer for K.G. Luke Limited, Melbourne. It was commissioned by Southdown Press to be created under contract. We assume that the terms of contract provided Southdown with exclusive ownership rights. 4. The awards were conceived by the then managing director of-Southdown Press; Mr. W. Bednall, and the then editor of TV Week, Mr. Rod Lever. 5. The Logie Awards were first presented in 1958. 6. John Logie Baird is dead. His widow still lives in Scotland. I hope these answers are sufficient. I would like to point out that the full name of the awards are the TV Week Logie Awards, but they are commonly referred to as merely the Logie Awards or the Logies. All three versions should be covered when registering the trademark. The advertising industry should be alerted to the registration, through publications such as Advertising News and B&T. 49 Following receipt of an examiner's report, a statutory declaration dated 10 May 1991 by Elizabeth Boling, a director of both Nationwide News and Southdown 123, was provided in support of the application. That statutory declaration was in the following terms: 1. I am a director of NATIONWIDE NEWS PTY. LTD., a company incorporated in the Australian Capital Territory, Commonwealth of Australia, of 32 Walsh Street, West Melbourne, Victoria 3000, Australia (hereinafter referred to as "the Company'') and that I have been associated with the Company for 15 years. I have full access to the records of the Company and am authorised to make this Declaration on its behalf. 2. I am aware that the Company is the Applicant in Australia for registration of its trade mark LOGIE (hereinafter referred to as "the said trade mark".) and details of the application are as follows: Number: 520305 Class: 16 Date: 2nd October, 1989 Goods: Paper, cardboard, articles of paper or of cardboard (not included in other classes); printed publications, magazines, newspapers, periodicals and other printed matter; and all other goods in this class. Number: 520306 Class: 41 Date: 2nd October, 1989 Goods: Entertainment services. 3. The said trade mark was first used in Australia by the Company approximately 31 years ago and has been used throughout Australia since that date to identify printed publications, magazines and other printed matter as well as entertainment services and promotional activities (hereinafter referred to as "the said goods and services") sold and/or sponsored by the Company. 4. The said trade mark is derived from the middle name of John Logie Baird, the inventor of television. The word was selected because the Company wanted the trade mark to have some general association with television and to give that trade mark a particular "aura". 5. I have ascertained from the Company's records that retail sales in Australia of the said goods and/or services under the said trade mark for the period 1985 to 1990 is as follows: Year Quantity 1985/86 5,294, 678 1986/87 5,818,328 1987/88 6,574,382 1988/89 6,653,488 1989/90 5,995,391 6. I have also ascertained from the Company's records that the amount spent on advertising and promoting the said goods and services under the said trade mark in Australia over the past five (5) years involves a direct cost figure of between $500,000 and $750,000. An indirect costing of such advertising and promotional activity, including all TV and on page comments, would run into millions of dollars. Attached hereto and marked Exhibit A is a folder containing a selection of advertisements and sample periodicals and also including an extract from the Herald-Sun with account of the LOGIE awards during the 1970s and early 1980s. 7. I have been associated with the marketing of periodicals and entertainment for (illegible) years and during that time I have acquired a knowledge of the trade names and marks used by the different manufacturers in this field. During my time in this field I have never heard of the use of the trade mark LOGIE by any other Company or individual in respect of the same goods in the same field and I can declare on the basis of my knowledge that in my opinion the said trade mark is now regarded as distinguishing the Company's records from those of others in the same field. The figures given in paragraph 5 of that statutory declaration represent the sales of TV Week in the respective years. The Exhibit A referred to in paragraph 6 of the statutory declaration contained examples of use of the Logie mark from 1963 onwards, that is, before Dowland became involved (1969) and long before Nationwide News became involved (1984). 50 Registration of the trade marks was granted to Nationwide News on 8 October 1991, for a period of seven years from 2 October 1989. 51 Finally, on this aspect, I note that there is in evidence a letter dated 17 March 1992 from solicitors acting for the News group referring to a proposed assignment of a Logie mark to Southdown 123; but it appears that this did not proceed. 52 In October 1991, News floated its printing and magazine business. The Southdown Press magazine business owned by Nationwide News was assigned to a company then called Pacific Publications Pty. Limited ("Pacific 878") wholly owned by PMP Limited ("PMP"). TV Week trademarks were assigned by Southdown 123 to Southdown 266, associated with the name change referred to earlier, the latter company being owned by Pacific 878. Nationwide News assigned the Logie trademarks to Pacific 878. 53 In 1992, ACP Magazines succeeded to the rights of ACP in the 1980 deed by virtue of a deed to which Southdown 266 was a party as well as ACP and ACP Magazines. It is common ground that by that time Southdown 266 stood in the shoes of News and Southdown 123 in relation to the 1980 deed. 54 In September 2001, PMP sold its magazine businesses including TV Week to Channel 7 Television Network interests. The holding company for those interests, namely 7 Network Limited, owned Jupelly, which in turn owned Pacific 896. Jupelly acquired the shares in Southdown 266, which owned TV Week, while Pacific 896 acquired the other magazines from Pacific 878. Pacific 878 assigned the Logie marks to Pacific 896. 55 Over the years of publication of TV Week, a collection of photographs associated with the magazine and the Logie awards was built up and maintained; and in the proceedings this was referred to as the photographic library. There was some dispute as to whether this was severable and distinguished from photographs associated with the whole stable of magazines produced by or under the name of Southdown Press. 56 Prior to March 2002, difficulties arose in the relationship between ACP Magazines and Southdown 266 in relation to the operation of the 1980 deed. Contested litigation was avoided by entry into a Deed of Settlement and Release on 14 March 2002 by parties including ACP Magazines, Southdown 266, Pacific 896 and Jupelly. In the deed, the first three of those parties are referred to as ACP, Southdown and Pacific. 57 Clause 3.1 of the deed provides as follows: 3.1 Subject to the performance of PMP of its obligations under clause 2 of this deed, ACP releases: (a) Southdown and its Related Parties; and (b) directors, officers and employees, and each of them, past and present, of Southdown and its Related Parties from all Claims arising out of or relating to the Disputes of the publication of Inside Soap. The word "Disputes" is defined to mean "all Claims arising out of or relating to the TV Week Deed or the conduct of the Business in the period up to 30 June 2001, including without limitation the Inspection Proceedings and the Principal Proceedings." The TV Week Deed referred to here and elsewhere in the deed is the 1980 deed. 58 Clause 4.1 of the deed provides as follows: 4.1 Subject to the provisions set out in this clause 4, ACP and Southdown ratify and confirm the TV Week Deed, which remains fully effective. Clause 4.9 of the deed provides as follows: 4.9 Each of Pacific and Jupelly acknowledge and agree that it will do all things necessary and provide all assistance required to ensure that Southdown complies with its obligations under clause 4 of this deed and under the TV Week Deed. 59 On 19 June 2002, ACP Magazines offered to sell to Southdown 266 its interest under the deed for $60 million. Southdown 266 declined, and ACP Magazines thus became obliged and entitled by the Savoy Clause to acquire the interest of Southdown 266 under the deed for the same amount. Southdown 266 assigned the name TV Week and associated marks to ACP Magazines, and Pacific 286 also assigned certain material. However, Pacific 286 refused to assign the Logie marks, and to deliver up photographs associated with the Logie awards, giving rise to these proceedings. DECISION OF PRIMARY JUDGE 60 The primary judge identified a number of issues, only two of which are relevant to this appeal: 1. Whether on the proper construction of cl.7.2 of the deed, the rights of Southdown 266 which must be transferred include the Logie marks and the photograph library. 2. If so, does it matter that the Logie marks are vested in Pacific 896? 61 The primary judge answered the first question yes, and the second question no. 62 In relation to the first question, the primary judge found that in the period prior to the 1980 deed, the business of TV Week included the conduct of the Logie awards, and was owned by Southdown 123. He found that the rights associated with the Logie name were assets of the business conducted pursuant to the 1980 deed, to which ACP became entitled pursuant to the Savoy Clause. 63 On the second question, the primary judge found that Nationwide News was an agent for Southdown 123 in relation to the publication of TV Week and in relation to the application for Logie marks; and accordingly held the Logie marks on trust for Southdown 123 when they were granted. Pacific 878 and subsequently Pacific 896 similarly were agents for Southdown 123 (and after October 1991, Southdown 266) in relation to the publication of TV Week and were trustees for those entities in relation to the Logie marks. In any event, the primary judge held that Pacific 896 was bound by the 2002 settlement deed to ensure that Southdown 266 complied with its obligations under the 1980 deed, including assignment to ACP Magazines of rights relating to the use of the Logie name. GROUNDS OF APPEAL 64 The appellants rely on the following grounds of appeal: Ultimate errors of construction (Judgment, paras 86 - 96,103) 1. His Honour erred in finding that, on a proper construction of the deed dated 6 August 1980 between Australian Consolidated Press Limited, News Limited and Southdown Publications Pty Limited ("the 1980 Deed"), the "interest" of the First Appellant ("Southdown 266") within the meaning of clause 7.2 of the 1980 Deed which Southdown 266 was required to sell to the Respondent ("ACP Magazines") included: (a) Australian Trade Marks nos. 520303, 520304, 520305 and 520306 and New Zealand Trade Marks nos. 202710 and 202711 ("the Logies Trade Marks"); (b) business names incorporating the word "Logies" ("the Logies Business Names"); (c) a library of photographs taken for TV Week magazine or acquired for the purposes of TV Week from others ("the TV Week Photographic Library"); and (d) copyright in, and any licence of copyright in, the TV Week Photographic Library. 2. His Honour erred in failing to find that, on a proper construction of the 1980 Deed, the interest of Southdown 266 within the meaning of clause 7.2 of the 1980 Deed which Southdown 266 was required to sell to ACP Magazines was limited to the TV Week trade marks, being the rights sufficient to publish a magazine under the name "TV Week". 3. His Honour erred in finding that, pursuant to clause 7.2 of the 1980 Deed, Southdown 266 was required to assign to ACP Magazines: (a) all of the rights which would enable ACP Magazines to continue the business of TV Week in the same manner and with the same commercial attraction as was previously the case; and (b) all rights which contributed to the commercial success of TV Week and which were "unique" elements. 4. His Honour erred in: (a) finding that the rights to publish the magazine called TV Week included rights necessary to conduct a television awards ceremony; (b) finding that the rights to publish the magazine called TV Week included rights necessary to promote that magazine in a particular way; and (c) failing to find that the particular use of the Logies trade marks and associated rights which occurred prior to 24 July 2002 was a use in connection with a sponsorship or association between the Logies awards ceremony and magazines (including TV Week) which were in the stable of magazines published by Downland Publications Limited ("Downland") and its successors in title. 5. His Honour erred in finding that the construction question arising from clause 7.2 of the 1980 Deed was to be answered by considering: (a) whether there was a separate business of publishing TV Week; and (b) whether the Logies trade marks and the other rights sought by ACP Magazines formed part of the goodwill of that business, and erred in failing to find that the relevant question was whether the rights sought by ACP Magazines were properly described as "all of the goodwill trademarks business names and other rights which permit the publication and are sufficient for the publication of the magazine called TV Week". 6. His Honour erred in finding that the phrase "goodwill attached to ... those titles" in clause 7.2 of the 1980 Deed operated to include assets other than the titles themselves, being assets which were independently sources of the goodwill of the business of publishing a range of magazines including TV Week. 7. His Honour erred in finding that the "interest" of Southdown 266 within the meaning of clause 7.2 of the 1980 Deed which Southdown 266 was required to sell to ACP Magazines included the rights referred to in paragraph 1, in circumstances where those rights were owned by the Second Appellant ("Pacific 896") and therefore did not form part of the "right title and interest" of Southdown 266 within the meaning of clause 7.2. 8. His Honour erred in finding that Pacific 896 was required to assign the Logies Trade Marks, the Logies Business Names, the TV Week Photographic Library and the copyright (and any licence of copyright in the TV Week Photographic Library to ACP Magazines pursuant to clause 4.9 of the Deed of Settlement and Release between ACP Magazines, Southdown 266, Pacific 896 and others dated 14 March 2002 ("the Deed of Settlement"). 9. His Honour erred in failing to find: (a) The obligation of Southdown 266 under clause 7 of the 1980 Deed was to assign its "right title and interest' in the "Rights" to ACP Magazines; (b) The obligation of Southdown 266 to assign rights under clause 7 of the 1980 did not and could not extend to rights owned by Pacific 896; and (c) Clause 4.9 of the Deed of Settlement, in requiring Pacific 896 to do all things necessary to ensure that Southdown 266 complied with its obligations under the 1980 Deed, did not require Pacific 896 to assign to ACP Magazines rights belonging to Pacific 896. Particular errors of construction - erroneous characterisation of the relationships between the Appellants and their predecessors (Judgment, paras 30, 31, 50-63, 79-85, 96-102) 10. His Honour erred in finding that: (a) there was a separate business of publishing TV Week; (b) that business was, by 1980, owned by Southdown Publications Pty Limited (ACN 004 241 123) ("Southdown 123") and later Southdown 266; (c) the role of Downland and its successors in title was confined to that of holding itself out as publisher of TV Week but conducting that business as agent for Southdown 123 and later Southdown 266; (d) there existed a separate goodwill in the TV Week business which was owned by Southdown 123 and later Southdown 266; (e) the Logies Trade Marks were a component of the goodwill of TV Week; and (f) Clause 7.2 of the 1980 Deed required the transfer to ACP Magazines of the rights which would enable ACP Magazines to continue the business of publishing TV Week so understood. 11. His Honour erred in failing to find that: (a) there was no separate business of TV Week, and no separate goodwill in such a business; (b) in and from 1969, and pursuant to arrangements entered into in 1969, the activity of publishing TV Week was carried on by Downland as part of publishing business carried on by Downland and involving the publication of a number of magazine titles; (c) this position continued with the successors in title of Downland, being Nationwide News Pty Limited ("Nationwide News"), Pacific Publications Pty Limited ACN 053 814 878 ("Pacific 878") and Pacific 896; (d) the only relevant role of Southdown 123 and its successor in title Southdown 266 was as the owner of the TV Week trade marks, which were licensed to Downland and its successors to use in their magazine publishing business; (e) the only business owned by Southdown 123 and its successor Southdown 266 was a business of licensing the TV Week trade marks to Downland and its successors; (f) the Logies trade marks were assets of a magazine publishing business operated by Downland and its successors, and were a source of the goodwill of that business; and (g) it was no part of the 1980 Deed that assets owned by Downland and sources of the goodwill of its business would be transferred under clause 7.2. 12. His Honour erred in: (a) finding that there was a trust over the Logies Trade Marks in favour of the owner of TV Week from time to time; and (b) failing to find that the Logies Trade Marks were legally and beneficially owned by Nationwide News, then Pacific 878 and then Pacific 896. Further errors in relation to the nature of the rights required to be assigned 13. Alternatively to the above grounds: (a) His Honour erred in finding that the "rights which permit the publication and which are sufficient for the publication of the magazine TV Week" included the right to own the Logies Trade Marks, the Logies Business Names, the TV Week Photographic Library and copyright in the TV Week Photographic Library, rather than the right to use those assets, being a licence or permission which was terminable at will or upon reasonable notice. (b) His Honour erred in finding that any rights which were held on trust for the owner of TV Week consisted of more than a licence or permission which was terminable at will or upon reasonable notice. (c) His Honour erred in finding that the obligation of Pacific 896 under clause 4.9 of the Settlement Deed to ensure compliance by Southdown 266 with its obligations under the 1980 Deed included the obligation to transfer more than a licence or permission which was terminable at will or upon reasonable notice. Errors in the manner of dealing with the Respondent's witnesses 14. His Honour erred in: (a) finding that in the period up to and immediately following 1980, the activities of TV Week were carried out by Southdown 123, and in particular: (1) that from 1970, Mr Brian Morris was managing director of Southdown 123 (para 8); (2) that the costs of Logies were met by Southdown 123 (para 15); (3) that Mr Morris was introduced as the managing director of Southdown 123 and that this was done to benefit magazines published by Southdown 123 (para 18); (4) that the Logies were consistently promoted by Southdown 123 (para 20); and (5) that Southdown 123 maintained a weekly reporting system for its magazines (para 24); (b) failing to find that from 1969 the business formerly carried on by Southdown 123 was carried on by Downland trading as "Southdown Press", that Mr Morris was employed by Downland, and that all of the activities referred to in paragraph (a) were activities of Downland not Southdown 123; and (c) finding that the time that executives of Downland Publications Limited spent on the Logies was generally allocated to the cost of managing the TV Week enterprise (para 84). 15. His Honour erred in forming and relying upon conclusions that: (a) in the public mind, a strong connection between TV Week and the Logie awards was created and constantly reinforced (para 22); and (b) that the Logies activities were organised primarily by people engaged in the publication of TV Week (paras 14, 26, 27, 28, 46, 47, 48, and 49) when these conclusions were irrelevant to the issues of construction which fell to be decided and those conclusions were inconsistent with other findings (e.g. paragraph 20) and against the weight of evidence. 16. His Honour erred in excluding from consideration the file of Mr McWilliam (paras 42 - 44) and thus ignoring relevant evidence, being objective facts known to both parties as evidenced by the file, and in particular: (a) erred in ignoring what was evidenced by the file as to the factual circumstances surrounding the entry into the 1980 Deed; and (b) erred in ignoring the evidence from the file as to what was and was not assigned pursuant to the 1980 Deed, and in particular that it did not include any employees, copyright, photographs, rights to use material, or any other rights other than a business name registration for the title of one of the magazines the subject of the 1980 Deed; in circumstances where his Honour otherwise considered it relevant to have regard to the factual circumstances surrounding the entry into the 1980 Deed in construing the 1980 Deed (paras 84, 87, 90 and 91). Particular errors in relation to the TV Week Photographic Library 17. His Honour erred in: (a) finding that there was a separate body of exclusive photographs (para 94); (b) finding that the photographs were an asset of the TV Week business (para 94); and (c) finding that, as an asset of the TV Week business, the photographs were required to be assigned to ACP Magazines under clause 7.2 of the 1980 Deed (para 95). 18. His Honour erred in failing to find that any photographs used in connection with the publication of TV Week were the property of the publisher in law and in fact of the stable of magazines which included TV Week - being Downland, then Nationwide News, then Pacific 878 and then Pacific 896 - and outside the reach of clause 7.2 of the Deed. 19. His Honour ought to have found that even on the erroneous test adopted by his Honour, the photographs and the copyright therein were not a significant part of the attractive force of TV Week and were not necessary for ACP Magazines to publish TV Week with the same commercial attraction as was previously the case. Error In respect to costs 20. His Honour erred in not reducing the costs order in the Respondent's favour for issues on which the Respondent was unsuccessful. 65 The issues actually advanced on the appeal can be dealt with under three headings: first, the issue of ownership of the business of TV Week and of the goodwill associated with the Logie awards and the name Logie, prior to entry into the 1980 deed; second, construction of the 1980 deed; and third, the significance of the registration of the Logie marks in the name of Nationwide News and later Pacific 896, rather than Southdown 123 or Southdown 266. OWNERSHIP OF BUSINESS AND LOGIE NAME IN 1980 66 Mr. Finch SC for the appellants submitted to the effect that, as at 1980, the correct conclusion was that Southdown 123 owned no more than the name TV Week, and that Downland owned the business of TV Week as well as the other magazines, and also rights associated with the conduct of the Logie awards. He submitted that the primary judge was in error in referring to Southdown 123 rather than Downland in paragraphs [15], [18], [20], [24] and [47] of the judgment; and that this error was indicative of error in the finding that Southdown 123 owned the business of TV Week and rights associated with the conduct of the Logie awards. He submitted that Downland's ownership was shown by the following: (a) All personnel engaged in the business and the conduct of the Logie awards were employees of Downland. (b) All equipment used in these matters was equipment of Downland. (c) Senior employees had editorial and managerial duties across all magazines published by Downland including TV Week, showing that there was a single business of publishing magazines including TV Week conducted and owned by Downland. (d) Ownership of the name TV Week by Southdown 123, and receipt of income related to TV Week, was consistent with this, and indicative of a licence fee paid by Downland to Southdown 123 for use of the name, while Downland owned the business itself and goodwill associated with the business: cf. Federal Commissioner of Taxation v. Murry (1998) 193 CLR 605. 67 Mr. Finch submitted that the position was further confirmed by the language of the 1980 deed. What Southdown 123 brought to the agreement was, as set out in Recital B, no more than goodwill, trade marks, business names and other rights which permitted and were sufficient for the publication of TV Week: that is, just those right associated with the name TV Week and no more. It was not bringing the goodwill of the business itself, nor rights associated with the conduct of the Logie awards, which were irrelevant to permitting and being sufficient for the publication of TV Week. 68 He submitted that it was further confirmed by notes of the solicitor acting for ACP in the 1980 transaction to the effect that TV Week was produced by Downland under licence from Southdown 123, that Southdown 123 contributed no assets in the sense of plant etc., and that Southdown 123 was owner of the masthead; and also by reference in legal opinions obtained by Southdown 123 to the effect that one possibility for achieving the purpose of the deed was ACP ceasing to publish its magazines. 69 Mr. Finch submitted that the position was further confirmed by the circumstance that, in 1989, when the method of operation was substantially the same as in 1980, except that Nationwide News was standing in the place of Downland, it was Nationwide News which applied for and later obtained registration of the Logie trademarks. 70 Finally on this aspect, Mr. Finch submitted that even if, contrary to his other submissions, Southdown 123 owned the business of TV Week, and Downland was doing tasks for it, there was still no basis for concluding that Southdown 123 had rights in respect of the Logie awards, any more than in respect of other assets, such as printing presses, applied by Downland for the benefit of TV Week. This was especially so in circumstances where the Logie awards were used for the benefit of other Downland companies, in particular in promoting Downland generally to the trade, in that clients or customers of other magazines in the Southdown Press group were invited to the Logie awards, and in that fashion photographs would appear in another magazine of that group, namely New Idea. 71 In my opinion, these submissions should be rejected. 72 The finding of the primary judge was that Southdown 123 and not Downland owned the business of TV Week in 1980, and that conduct of the Logie awards was an integral part of that business. There was ample evidence to support that finding. It is true that in places the primary judge erroneously referred to Southdown 123 when, in respect of the period after 1969, he should have referred to Downland; but in my opinion that was a verbal error only, in circumstances where the primary judge was referring to the conduct of a stable of magazines and the attribution of costs to the TV Week business. 73 The theory put forward by the appellants to the effect that the attribution by Downland of income and expenses of TV Week to Southdown 123 was merely a mechanism for arriving at a licence fee for the use by Downland of the masthead TV Week, in Downland's single business of conducting a stable of magazines including TV Week, is in my opinion highly implausible. Contemporary documents including financial records consistently show TV Week alone as treated differently from the rest of the magazines produced by Downland, and not one entry in any such documents suggests that the attribution of all income and expenses of TV Week to Southdown 123 was by way of calculation of a licence fee or otherwise anything other than a recognition of Southdown 123's ownership of the business of TV Week. Cryptic comments in the notes of ACP's solicitor, even if taken to suggest the contrary, have minimal weight in comparison with the circumstances discussed by the primary judge and the contemporary records of the business itself. 74 The language of the 1980 deed gives further reason to reject the appellant's theory. Recital C asserts that TV Week was "edited, printed and distributed" for Southdown 123 by Downland, this being wholly inconsistent with the theory that Southdown 123's role was merely owner of a masthead licensed to Downland for a fee. It is true that Downland was not a party to the 1980 deed; but Downland was associated with News which was a party, and relevant successors to Downland are bound by the terms of the deed to the extent provided in the 2002 settlement deed. The recital in any event is admissible hearsay under s.60 of the Evidence Act 1995; and in my opinion, it carries substantial weight independently of its force as an admission and/or by virtue of estoppel by deed. 75 As regards the appellants' fallback position, namely that even if the TV Week business was owned by Southdown 123, rights associated with the Logie awards were owned by Downland, no basis is shown for overturning the primary judge's finding that the conduct of the Logie awards was an integral part of the TV Week business. Such finding was overwhelmingly supported by the evidence. Further, the use of the Logie awards to benefit other Downland magazines was no more than minor and incidental; and apart from such minor and incidental benefits, all costs and benefits associated with the conduct of the Logie awards were attributed to Southdown 123. One further factor was that as at 1980, Southdown 123 was the applicant for Logie trade marks. 76 Accordingly, I would uphold the primary judge's finding that, at the time of entry into the 1980 deed, the business of TV Week was owned by Southdown 123, and that the conduct of the Logie awards was an integral part of that business. I would also hold that rights associated with the use of the Logie name, including the right to have the benefit of this use protected by passing-off proceedings, were rights of Southdown 123. CONSTRUCTION OF THE 1980 DEED 77 Mr. Finch submitted that the interests of News referred to in cl.7.2 of the deed was only the interest of News in the Rights referred to in cl.1.2 of the deed, which in turn were no more than the sum of the Rights referred to in Recitals A and B. Accordingly, so far as rights in relation to TV Week were concerned, all that was brought by News/Southdown 123 to the agreements were those rights which "permit it to publish and are sufficient for the publication of" TV Week. That included rights associated with the name TV Week; but did not include other assets such as personnel or equipment, or rights associated with the Logie awards, none of which related to what it was that permitted and was sufficient for the publication of TV Week. Accordingly, such assets including rights associated with the Logie awards were not within News Rights referred to in Recital B, nor within the Rights in cl.1.2, nor within News' interest in those Rights in cl.7.2. 78 Mr. Finch submitted that the primary judge asked the wrong question when he posed, as the relevant question, whether the goodwill associated with the Logie awards was an asset of the business of TV Week, in circumstances where the 1980 deed did not deal with that business but only with those rights which permitted or were sufficient for the publication of TV Week. 79 He submitted that the reference in cl.1.1 to the merging of Rights in the business referred to in cl.2 was not contrary to the appellants' case: this did not mean that the Rights were the business, or that the rights under the agreement included the business itself. 80 He also submitted that cl.9(a) was not contrary to the appellants' submission. He submitted that there was no basis to include rights in relation to the Logie awards any more than other assets of Downland used for the purpose of the TV Week business: accepting that the Logie name was used in connection with the TV Week business, it was sufficient that there be no impediment to that use, and the warranty in cl.9(a) did not amount to a promise that all rights in relation to the Logie awards were included in the rights under the agreement. He also made further submissions based on the proposition that the Logie rights were in any event owned by Downland: because of my decision in relation to the first issue I identified, I need not consider those submissions. 81 In my opinion, these submissions on the second issue should also be rejected. 82 It is clear that rights associated with the use of the name Logie in connection with television awards were "rights held, owned or used required in connection with or for the purpose of the publication of … 'TV Week'" within the meaning of cl.9(a). That was plainly established by the evidence and found by the primary judge. The name Logie was in fact used in connection with the publication of TV Week; and the nature and extent of such use, as found by the primary judge, was plainly sufficient to give rise to rights in relation to that name that would be protected by legal proceedings, such as proceedings for passing off, by the owners of the TV Week business. 83 In my opinion, this indicates that the intention of the parties was that "the Rights" referred to in cl.1.2 as being the result of merger, in the business referred to in cl.1.1 and cl.2, of the ACP Rights and the News Rights, should include the rights of the owner of TV Week in respect of the name Logie. 84 The appellants' contention is that the News Rights are, by virtue of Recital B, restricted to only those rights which "permit it to publish and are sufficient for the publication of" TV Week. However, Recital B does not say that the News Rights are the minimum rights which permit and are sufficient for the publication of TV Week. Having regard to the warranty in cl.9(a), Recital B must be taken as extending to all the rights that News and/or Southdown 123 in fact had which in fact permitted and were sufficient for the publication of TV Week in the manner and with the features that the publication did in fact have, including use of the name Logie. 85 In my opinion, this is confirmed by the structure of the agreement. What is contemplated is that there will be a business of publishing TV Week (see cls.1.1 and 1.2) which will continue as before (except that the magazine will be treated as incorporating the ACP magazines and will not be subject to competition from them); and the profits of which will be divided equally between the News interests and the ACP interests (cl.3). If, as found by the primary judge, use of the name Logie was an important part of that business prior to the agreement, then the intention was that it continue to be so. Clauses such as 1.5, 4.1, 6, 11, 13 and 19 confirm that it was a business being dealt with, not a bare rights to use the name TV Week. 86 In my opinion, this is further confirmed by the terms of the Savoy Clause. This proceeds on the assumption that the rights of each party to the business are equal; so that if one party is unwilling to buy out the other party at a figure specified by the latter, then the latter should be entitled and obliged to buy out the former at the same figure. This confirms that rights of either party contributing to the success of the business should be treated as assets of the business, and as part of the interest of that party under the agreement. 87 There is in my opinion every reason for treating rights concerning the use of the Logie name differently from personnel and other assets used for production of the magazine. The recitals, cl.7.2 and cl.9(a) are referring to rights of the nature of goodwill and intellectual property, not to personnel or physical assets. 88 In my opinion, the photographic library is an asset of the nature of intellectual property of the business of TV Week, and is also included in the rights dealt with by the 1980 deed. 89 Accordingly, in my opinion, the primary judge was correct to hold that Southdown 266 was obliged by cl.7.2 of the 1980 deed to transfer to ACP Magazines rights associated with the conduct of the Logie awards and the use of the Logie name. SIGNIFICANCE OF REGISTRATION OF THE LOGIE MARKS IN THE NAME OF NATIONWIDE NEWS AND SUBSEQUENTLY PACIFIC 896 90 It was submitted for the appellants that the primary judge was inconsistent in that he held that the marks were applied for my Nationwide news as publisher of TV Week, and then transferred to Pacific 896 as publisher of TV Week, in circumstances where he had found that Southdown 123 and later Southdown 266 to be the publisher of TV Week. Mr. Finch submitted that the primary judge was also in error in holding that the application and holding of the marks was as agent for Southdown 123 and later Southdown 266: as shown by the documents, he submitted, the applications were for Nationwide News on its own behalf, and the alternative of applications by Southdown 123 was considered and rejected. 91 Mr. Finch submitted that the primary judge was in error in saying "there was no other explanation", in relation to these matters: even if the appellants' submissions were rejected on the first two issues, the application could have been made by Nationwide News on its own behalf with the concurrence of Southdown 123, or by reason of confusion or mistake, and in either case, no trust would arise. Even if there may have been a remedy available to Southdown 123 (and later Southdown 266), there was no claim now because of the release contained in the 2002 deed. 92 In my opinion, these submissions also should be rejected. 93 The documents relating to the trade mark applications are quite inconsistent with any deliberate decision of Southdown 123 to give up rights in relation to the Logie awards and name. Had there been any appropriate attention paid to the distinction between the position of Southdown 123 and that of Nationwide News, it is inconceivable that the statutory declaration of May 1991 would have been made in the terms in which it was made. An assertion that Nationwide News, as an entity advertently considered as distinct from Southdown 123, had used the mark for 31 years would have been knowingly false. The truth was that it was Southdown 123 that had as principal used the mark for 31 years, and that the use of it by Nationwide News, which had only been since 1984 (a mere seven years) was only as agent and on behalf of Southdown 123. The solicitor's note of 2 October 1989 similarly displays only the most superficial and inaccurate consideration of the distinction between the position of Southdown 123 and that of Nationwide News. 94 There are two possible consequences of this. One is that one should look at the substance of what was said and done, and conclude, as did the primary judge, that in substance the intention manifested was that Nationwide News apply for and be granted registration as agent for Southdown 123, albeit this was not the clear subjective intention of the participants because their grasp of the true situation was so defective; and on that basis, imply a trust in favour of Southdown 123. The other is to say that there was no efficacious intention of the participants inconsistent with registration being obtained beneficially for Nationwide News, but because of entitlement of Southdown 123 to use of the name and because of the mistakes and misrepresentations through which Nationwide News obtained registration, Southdown 123 was entitled in equity to the benefit of that registration. Along with the primary judge, I prefer the former: I think that it would more appropriately give effect to the intentions manifested by what was asserted and done in connection with the application. 95 Problems arise in various areas of law where legal consequences attach to intentions, and the actual intentions of the relevant persons (whether considered subjectively or as being intentions manifested by conduct) contain inconsistencies because of mistakes and misapprehensions. One example is in contract law, where one person deals with another person who is immediately present but who states falsely that he or she has certain characteristics (name, financial standing, etc.). In such cases a question can arise as to whether a contract purportedly made in those circumstances is void, because the former person intended to contract only with a person who had the stated characteristics, or merely voidable, because the former person intended to contract with the person who was present but was induced to do so by the misrepresentation: Phillips v. Brooks Ltd. [1919] 2 KB 243, Ingram v. Little [1961] 1 QB 31, Porter v. Latec Finance (Qld) Pty. Ltd. (1964) 111 CLR 177, Papas v. Bianco Investments Pty. Ltd. (2002) 82 SASR 581. 96 Although various explanations have been given for the solutions arrived at in such cases, in my opinion the most satisfactory approach is to recognise that mistake may give rise to inconsistent intentions, and to ask whether there is an intention or consistent set of intentions which can reasonably be regarded as predominating over inconsistent intentions. Thus in Ingram v. Little, the circumstances and the conduct of the mistaken party showed that it attached far more importance to the name and financial standing of the other party than to his presence, so that the manifested intention to contract with the person of that name and financial standing predominated over any intention to contract with the person who was present. 97 In the present case, those who conducted the applications for the Logie marks had inconsistent intentions. (I need not consider whether it is subjective intentions or intentions as objectively manifested that are important here: there is no suggestion of any divergence.) I accept that these persons acted honestly and without any intention to mislead the trade marks office or to misappropriate property. Their intention was to obtain trade marks for Nationwide News; but their intention was also to obtain trade marks for the entity that had used the name for 31 years and was entitled to the name. The former intention involved making misrepresentations to the trade marks office and misappropriating the property of another entity (Southdown 123); and it was in my opinion of utmost importance to the persons involved that they not do these things. Therefore it is reasonable to regard the intention to obtain the marks for the entity that had used the name for 31 years and was entitled to the name as predominating over the intention to obtain the marks for Nationwide News. 98 An alternative view could be that, by reason of inconsistency of intentions, there was no efficacious intention at all which could displace the legal ownership of the marks by Nationwide News. However, my opinion is that the intention to obtain the marks for the entity entitled to them was plainly predominant and is appropriately given effect to by treating the application by Nationwide News as being made as agent for Southdown 123. On that basis, there was an implied trust in favour of Southdown 123, not merely an equitable right to secure the benefit of the registration. 99 However, even if Southdown 123 had only an equitable right and not full beneficial ownership, the result would be the same. Clause 7.2 of the 1980 deed entitles ACP Magazines as against Southdown 266 to an assignment of rights to use the Logie name in connection with the TV Week business. Southdown 266 is unable fully to honour that obligation so long as Pacific 896 retains beneficial entitlement to the Logie marks. Pacific 896's obligation in the 2002 settlement to do all things necessary and provide all assistance required to ensure that Southdown 266 complies with its obligations under the 1980 deed means that Pacific 896 must at the very least divest itself of the Logie marks. There might conceivably be a question whether this could be effected by some measure less than an outright transfer of the marks to ACP Magazines. However, in my opinion outright transfer is the appropriate remedy, especially having regard to ACP Magazines' equitable right to the marks and Southdown 266's obligation to perfect that equitable right, in relation to which Pacific 896 is obliged to do all things necessary to ensure compliance. Southdown 266 will be in breach of the 1980 deed if it fails to secure the assignment to ACP Magazines of the Logie marks, and Pacific 986 is obliged to do what it can to ensure that no such breach occurs. I would add that I do not consider that ACP Magazines' equitable right to the marks was given up by the release in the 2002 deed, because this right is granted by the 1980 deed and is not the subject of any of the disputes resolved by the 2002 deed. CONCLUSION 100 Accordingly, the appeal fails. In addition to dismissing the appeal, in my opinion this Court should clarify the determination of the proceedings by ordering that the cross-claim be dismissed. Accordingly, I propose the following orders: 1. Appeal dismissed with costs. 2. Cross-claim dismissed. ********** Last Modified: 11/27/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.