Fire Containment Pty Ltd v Robins [2011] NSWSC 533

Supreme Court New South Wales

Medium Neutral Citation: Fire Containment Pty Ltd v Robins [2011] NSWSC 533 Hearing dates: 6 June 2011 Decision date: 06 June 2011 Jurisdiction: Equity Division Before: Gzell J Decision: Defendants' undertakings accepted by plaintiff. Catchwords: CONTRACTS - General Contractual Principles - Offer and Acceptance - undertakings proffered in defendants' written submissions - accepted by counsel for plaintiff - whether conditional upon acceptance of defendants' proposed orders that the proceedings be otherwise be dismissed and each party bear their own costs Category: Principal judgment Parties: Fire Containment Pty Ltd (Plaintiff) Peter Robins (First Defendant) Mark Prior (Second Defendant) Trafalgar Fire & Safety Pty Ltd (Third Defendant) Trafalgar Passive Fire Solutions Pty Ltd (Fourth Defendant) Representation: Counsel M Painter/S Nash (Plaintiff) C Leggat SC/B Nolan (Defendants) Solicitors Adams & Partners Lawyers (Plaintiff) Tiernan Lawyers (Defendants) File Number(s): 2009/289828

EX TEMPORE Judgment 1This matter was set down before me for a 5-day hearing commencing today on 16 November 2010. On 1 June 2011 the solicitors for the Defendants wrote to the solicitors for the Plaintiff making an offer in these terms: "By consent and without admission: The Court Notes: 1. The Defendants do all things necessary to relinquish the use of the name "Trafalgar" on the following terms and conditions: a. From the date of these orders, and subject to condition 1(f) herein, the Defendants will cease using the word "Trafalgar" in the operation of its business, except where necessary to accord legally with the former name of our business, (eg. legal or financial reporting, or dealing with debtors), or unless required to do so by reason of any agency agreement entered into with the Defendants as agent; b. From the date of these orders, and subject to condition 1(f) herein, the Defendant's undertake to discontinue using the Defendant's "Trafalgar logo" being Schedule 1 to the Summons filed in these proceedings ("the Defendants' Trafalgar logo"); c. From the date of these orders, and subject to condition 1(f) herein, the Defendants undertake to cease using any current trademark applications involving the name "Trafalgar", including those that are still being processed; d. From the date of these orders, and subject to condition 1(f) herein, the Defendants on their own account undertake to refrain permanently from applying for or registering any Business Name, Company Name, Trade Mark or any other form of intellectual property right which incorporates the name "Trafalgar", unless required to by reason of any agency agreement entered into with the Defendants as agent; e. From the date of these orders, and subject to condition 1(f) herein, the Defendants on their account undertake to cease representing that they have purchased or that they are in any way affiliated with the business formally known as "Trafalgar Building Products"; f. Within 2 months from the date of these orders, the Defendants undertake to cease distributing all written or electronic material including letterhead, business cards, or promotional or advertising material or pricing guides which incorporate the "Trafalgar" name or the Defendant's Trafalgar logo as referred to in 1(b) above; g. From the date of these orders, and subject to condition 1(f) herein, the Defendants undertake to sell down current stock which includes the "Trafalgar" name and the Defendants' Trafalgar logo; h. From the date of these orders, and subject to condition 1(f) herein, the Defendants undertake from the date of these orders not to order or purchase any further products which bear the "Trafalgar" name, or the Defendants' "Trafalgar" logo; i. The above undertaking shall apply and extend only to the Defendants, their employees and their agents. 2. The plaintiff undertakes never to register or promote any business using the name "Trafalgar Fire & Safety". 3. The Plaintiff and the Defendants undertake to issue a joint media release confirming settlement proceedings only on terms as agreed by them. The Court orders that: 1. Each party bear their own costs of the proceedings, despite any costs orders that have been awarded in the proceedings to date; 2. The proceedings be otherwise dismissed." 2By letter dated 2 June 2011, the solicitors for the Plaintiff rejected the offer and made a counter-offer in these terms: "The plaintiff would be prepared to accept the undertakings contained in your letter if the undertakings were made on an open basis (that is not on a "without admissions" basis), and the parties agree to an Order by consent that the defendants are to pay the plaintiff's costs as agreed or assessed." 3Mr Leggat SC who, with Ms Nolan, appears for the defendants, submitted that the offer contained in the letter of 1 June 2011 having been rejected, the offer was no longer capable of being accepted. But in written submissions filed in the ECM court on 3 June 2011, the undertaking in the letter of 1 June 2011 was repeated in par 17 in slightly different form as follows: "The Undertakings that the Defendant is prepared to make on a final basis: 17. In genuine resolution of these proceedings, the Defendant is prepared to give the following final undertakings and has offered them in an open letter dated 1 June 2011 ("the final undertakings"): a. refrain from using the word "Trafalgar", or any variation of that word, in the operation of his or its business or trading activities; b. discontinue using the "Trafalgar logo" as depicted in Schedule 1 to the Summons filed in the proceedings dated 29 July 2009 ("the Trafalgar logo"); c. cease using any current trademark involving the name "Trafalgar"; d. withdraw any pending trademark application involving the name "Trafalgar"; e. refrain from applying for or registering any business Name, company name, trade mark, or any other form of intellectual property right which incorporates or involves the word "Trafalgar", or any variation of that word; f. refrain from representing that he, it or they have purchased or are in any way affiliated with the business known as "Trafalgar Building Products"; and g. refrain from distributing any written electronic material including letterhead, business cards or promotional or advertising material or pricing guides which incorporate "Trafalgar" or any variation of that word, or "the Trafalgar logo". ("the final undertakings")" 4In par 26 of the written submissions under the heading "Orders sought", the following appeared: "26. The Defendants propose that the orders made should properly be as follows: The Court notes: 1. The defendants agree to give the following undertakings without admission: Pars (a) to (g) of par 17 were set out. 2. Without admission each of sub-paragraphs 1(a) - (g) apply to each of the defendants and his, its or their agents. The Court orders that: 1. The proceedings be otherwise dismissed; 2. Each party bear their own costs of the proceedings." 5When the matter was called this morning Ms Painter, who with Mr Nash appears for the Plaintiff, said that her client accepted the undertakings in par 17. 6Mr Leggat submits that the undertakings in par 17 were conditional upon the acceptance by the Plaintiff of the orders proposed by the Defendants that the proceedings be otherwise dismissed and each party bear their own costs of the proceedings. 7I do not read the renewed offer of undertakings in the written submissions to be conditional upon the Plaintiff's acceptance of the Defendants' proposed orders that the proceedings be otherwise dismissed and each party bear their own costs of the proceedings. It seems to me that there was an offer of undertakings and a submission as to the appropriate orders. Agreement to the proposed orders is not overtly or by implication a pre-condition to acceptance of the undertakings. 8Mr Leggat SC informed the Court that he had had a conversation with Ms Painter before the case was called in which he indicated that the offers were a package; that is, that the undertakings in par 17 were subject to acceptance by the Plaintiff of the orders that the Defendants proposed should be made by the Court. 9The Court was not informed of this conversation before Ms Painter accepted the undertakings in par 17. Nor was the Court informed that the offer in the written submissions was meant to be one in which the undertakings in par 17 were conditional upon acceptance of the proposed court orders in par 26. Nor was any application made to amend the written submissions to make this clear or to withdraw the offer. 10In my view, the undertakings in the written submissions were accepted by the Plaintiff. The Plaintiff was entitled to accept the undertakings in par 17 as the document in which that offer was made did not, as I have indicated, make the undertakings conditional upon acceptance of the proposed orders. 11I must say that the undertakings appear to me to be appropriate upon the affidavits that have been filed and included in the court book, all of which I have read. 12The holding company of Trafalgar Products Pty Ltd when dealing with the Defendants in negotiations to sell the remaining portion of the business of that company to the first Defendant, then dealing only with the first Defendant as the prospective purchaser of that business, allowed him to incorporate Trafalgar Passive Fire Solutions Pty Ltd in order that it would be the purchaser under the contract for sale. 13Mr Robin and Mr Prior on the evidence incorporated Trafalgar Passive Fire Solutions Pty Ltd and also incorporated Trafalgar Fire & Safety Pty Ltd. But the sale of the business to Mr Robins and to the nominated purchaser Trafalgar Passive Fire Solutions Pty Ltd fell through. It was in that context that the question arises - on what basis could the Defendants regard themselves as entitled to utilise the Trafalgar name in the conduct of their business? The business was sold to the Plaintiff including the intellectual property which included the use of the name "Trafalgar". 14In that context, it would have been more likely than not that the Court would have made orders consistent with the undertakings that were proffered. 15But as Mr Leggat submitted, cross-examination may have elicited a different scenario. 16Having reached the conclusion that I have, that the undertakings in par 17 were capable of being accepted and were accepted, this hearing should proceed upon the basis that remedies in the nature of declaratory and injunctive relief are no longer necessary.