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IN THE SUPREME COURT OF SOUTH AFRICA (APPELLATE DIVISION)

In the matter between :-

PLASCON-EVANS PAINTS

(TVL) LIMITED" appellant

AND

DECRO PAINT AND HARDWARE

(PTY) LIMITED respondent

Coram: CORBETT, MILLER, NICHOLAS, JJA, et GALGUT et HOWARD, AJJA.

Date of appeal: 28 February 1984.

Date of judgment: 21 May 1984.

JUDGMENT
CORBETT JA:

This appeal originates from proceedings

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instituted on notice of motion in the Orange Free State Provincial Division ("OPD"). Appellant, a dealer in paints and allied products, is the proprietor of a trade mark registered in terms of the Trade Marks Act 62 of 1963. The trade mark consists of the word "Micatex". It was registered in respect of certain goods, including inter alia paints, falling within class 2 of the fourth schedule to the Trade Marks Regulations, 1963.
In November 1980 appellant instituted the aforementioned notice of motion proceedings, citing respondent, a company dealing in paints and having its registered office in Welkom. In the founding affida-

vit it was stated that during September 1980 it came

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3. to appellant's attention that respondent was marketing and selling a type of paint, known as "texture coating", under the mark "Mikacote". This paint was manufactured by a company known as Van Riebeeck Paints (Pty) Ltd ("Van Riebeeck"). Appellant alleged that this use by respondent of the mark Mikacote infringed its rights as the proprietor of the registered trade mark, Micatex, and also that respondent was unlawfully passing off its goods as those of the appellant. Appellant claimed, with ancillary relief, interdicts restraining respondent from using the mark Mikacote in relation to any paint or texture coating sold or distributed by it and from passing off any product sold or distributed by it as being Micatex paint, or texture coating.

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The Court of first instance (MALHERBE AJ) found in favour of appellant on both issues, viz. infringement of trade mark and passing off, and granted interdicts accordingly. For reasons which will later become apparent appellant filed, in reply to respondent's opposing affidavits, certain affidavits which were alleged by respondent to contain new matter. Respondent objected to these affidavits in so far as they contained new matter and applied that the offending parts of the affidavits be struck out. In substance this appli-cation succeeded and the Court awarded respondent the costs of this application; otherwise the costs followed the result. This judgment was delivered on 25 June 1981.

Respondent appealed to the Full Bench of the OPD

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5 against this decision, except in so far as it dealt with the application to strike out. There was no cross-appeal by appellant against the striking out order. On appeal the Full Bench reversed the decision of MALHERBE AJ on both the issue of infringement and the issue of passing off, allowed the appeal and substituted for the order of the Court of first instance an order dismissing the application with costs. This judgment, which was delivered on 24 June 1982, has been reported (see Decro Paint and Hardware (Pty) Ltd v Plascon-Evans Paints (Tvl) Ltd, 1982 (4) SA 213 (0) ). Leave to appeal to this Court was granted, despite opposition from respondent, and it was ordered that the costs of the application be costs in the appeal.

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Parallel litigation took place in the Cape Provincial Division ("CPD") the parties there being the present appellant (the slight difference in name is not explained in the papers) and Van Riebeeck. In those proceedings, also instituted on notice of motion, appellant claimed against Van Riebeeck interdicts against infringement of trade mark and against passing off, together with ancillary relief. In the Court of first instance the passing off claim was not pursued, but the infringement claim was. The application succeeded in the Court of first instance, which granted, inter alia, an interdict restraining infringement of trade mark. Judgment on that application was delivered on 9 July 1981. An

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appeal to the Full Bench of the CPD followed. This was successful. The judgment of the Full Bench was given on 19 April 1982. With leave of the Court a quo that matter was taken on appeal to this Court. The appeal was heard on the day before the hearing of the appeal in the instant case. (For the sake of brevity I shall refer to this as "the Cape litigation".)
As regards the infringement issue the same type of evidence was placed before the Court by the parties in the instant case as was adduced, on affidavit, in the Cape litigation; and it was common cause that the decision on this issue arrived at in the Cape litigation would be equally applicable in the instant

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case. This issue is fully canvassed in the judgment of this Court in the Cape litigation, which is to be delivered immediately prior to the delivery of judgment in this case. For the reasons there stated the infringement issue must be resolved in favour of the appellant.

As regards the issue of passing off, I am of the view, substantially for the reasons stated by the Court a quo (at pp 219 D to 222B), that this claim for an

interdict should fail. In essence appellant's cause

of action for passing off was based not, as is often

the case, on the deceptive resemblance of the get-up of the goods, but in the main on an alleged course of conduct by respondent's employees whereby they passed off

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9. the texture coating marketed under the mark Mikacote as being appellant's Micatex texture coating. In two instances the evidence consisted of "trap" purchases, ie instances where persons went, at appellant's instigation, to respondent's premises in Welkom and ordered certain quantities of Micatex. Although it seems possible that in their original affidavits the deponents intended to allege that they were served with Mikacote paint, they did not expressly do so. In the one case (that of Mr Harwood) the furthest that the deponent went was to allege that the cash slip issued with the goods referred to them as tins of "Mikacoat". The sales clerk who dealt with Mr Harwood sought to explain this. The

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explanation is not particularly convincing; nor is it very explicit, but it implies that the "Mikacoat" notation on the cash slip was a mistake. The deponents Harwood and Burton endeavoured, in replying affidavits, to repair their earlier omission to state that they were served with Mikacote paint (instead of Micatex, as ordered), but these were among the items ordered to be struck out by the Court of first instance. The only other direct evidence of passing off is that of Mr Bruwer, the manager of the hardware department of the Welkom branch of Pick-n-Pay. He deposed to having telephoned respondent's shop and having been told by an employee that the shop stocked Micatex. This was contrasted

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11 with the evidence of Mr Howard, the manager of appellant's Welkom branch, who stated that he told customers that respondent was not a stockist of Micatex. Assuming that this could be read as an averment that respondent did not stock Micatex, it was contradicted by Mr Becker, respondent's managing director, who stated unequivocally that respondent did stock both Mikacote and Micatex.

Appellant also made some point of the fact

that respondent used certain colour names for its

Mikacote which were identical to those used for Micatex by appellant. The colour names, viz. "Kalahari" "Umgeni Sand" and "Kirstenbosch" appear certainly to be unusual, but there is no evidence to show that they

were not used by other paint manufacturers.

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12 Finally, appellant referred to a letter of demand (annexure "O" to the founding affidavit) addressed to respondent by appellant's attorneys and dated 17 October 1980, In the letter it is alleged, inter alia, that respondent is deliberately passing off the product sold by it as Micatex. There was no reply to this letter. Motion proceedings were instituted just over a month later, I do not think that respondent's failure to reply to the letter of demand can be interpreted as any sort of an admission on its part. Nor do I think that these facts materially advance appellant's case on the passing off issue.

Generally this evidence fails to establish

the alleged passing off.

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13 It was argued by respondent's counsel that in the event of the appeal succeeding this Court should make a special order as to costs. In this connection counsel made reference to certain correspondence which passed between the attorneys of the parties at various stages of the litigation. Some of this correspondence was placed before the Court a quo, when application was made for leave to appeal to this Court; the remainder was produced by the parties at the request of this Court. The correspondence shows:

(1) That in October 1981, after judgment had been given by VAN HEERDEN J in the CPD and by MALHERBE AJ in the OPD and when it was known that the appeal to the Full Bench of the CPD

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14 had been set down for hearing on 9 November 1981, it was suggested by respondent's attorneys that the "Bloemfontein matter be held over pending the outcome of the Full Bench hearing in Cape Town". Appellant's attorneys replied that they were instructed that their client was not prepared to hold the "Bloemfontein matter" in abeyance pending the appeal to the Full Bench of the CPD.
(2) That in March 1983, after both appeals to this Court had been noted, respondent's attorney wrote to appellant's attorney suggesting that both appeals be set down for hearing simulta-

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15 neously. Appellant's attitude, as conveyed by its attorneys some time later, was that the appeals should not be heard simultaneously, but on consecutive days, if that could be arranged. It was suggested that the "Cape matter" be heard first. As a reason for this attitude appellant's attorneys stated that as issues which had no relevance in the Cape case arose in the OFS matter, it was "inappropriate" that the two cases be "merged together".
In the result the two cases were heard separately but
on consecutive days by this Court.

I fail to discern in this correspondence
read against the general background circumstances, any

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good ground for penalising appellant with a special order as to costs. As regards the correspondence referred to under (1) above, had respondent's suggestion been followed, respondent itself would no doubt have been keen to pursue the appeal to the Full Bench of the OPD, once the result of the appeal to the CPD became known. And in that situation (given the result of the appeal to the Full Bench of the OPD) any attempt to obtain a simul-taneous, or near simultaneous, hearing of the two appeals to this Court might have resulted in delay in the hearing of the appeal in the Cape matter, since it would have had to await the determination of the OFS matter by the Full Bench.

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As regards (2) above, it is perfectly correct that in the OFS case issues in regard to passing off arose which did not arise in the Cape case. Consequently, I cannot regard the attitude of appellant in wanting the two cases to be heard separately as being so unreasonable as to warrant appellant, as the successful party, being deprived of costs.

During the course of argument before us it was revealed that respondent had some time ago terminated its use of the Mikacote mark. This does not relieve this Court of deciding the issues raised by the appeal, but the question was raised as to whether it should have any influence on the costs. It appears, however, that there is

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no agreement between the parties as to when this occurred or as to whether respondent informed appellant prior to the hearing that it had ceased to use the mark. This fact, viz the discontinuance of the use of the mark, does not seem to me to have any bearing on the question of costs.
The finding by this Court that appellant establish infringement of its trade mark, but failed to prove unlawful passing off means (a) that in the Court of first instance an interdict against passing off ought not to have been granted; (b) that in the Court a quo the appeal ought to have failed in part (on the infringement issue) and succeeded in part (on the passing off issue); and that (c) the appeal to this Court succeeds in part (on the infringement issue) and fails in part

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19 (on the passing off issue). The question is what order should be made in regard to costs in all three courts.

There is no indication that the costs of the

appearance before MALHERBE AJ were substantially increased
by the unsuccessful reliance by appellant on passing off

as a cause of action. Success on the infringement issue
meant that appellant achieved what it had set out to
achieve, viz. an interdict restraining respondent from
using the mark Mikacote. And, of course, it was the
use of this mark by respondent in relation to its

product which was foundational to both the infringement

and the passing off claims. The affidavits relating

to passing off were to some extent relevant also on the

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question of infringement, eg. as showing possibly a measure of confusion as to the Micatex and Mikacote paints on the part of respondent's employees. On the whole I see no reason why appellant should not be awarded its costs in the Court of first instance.

As regards the costs in the Court a quo the measure of success which respondent (appellant in that Court) ought to have achieved, viz. the setting aside of the interdict against passing off, could hardly be described as substantial success. In view of the fact that, in terms of the order which the Court a quo should have made, the interdict against the use of the mark Mikacote would stand, the victory would have been

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21. essentially a technical one and, in my opinion, should not have carried the costs of appeal. Nor, I may add, is there any indication that the canvassing of the passing off issue added substantially to the costs of the hearing.

In this Court it cannot be doubted that appellant achieved substantial success and I do not think that its failure on the passing off issue warrants a special order as to costs.

It is ordered as follows:

(1)	The appeal is allowed with costs, including the costs of two counsel.
(2)	The order of the Court a guo is set aside and there is substituted the following order:

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"(a) The appeal is allowed to the extent that par. 1(b) of the order the Court a quo is deleted; otherwise the appeal is dismissed.

(b) Appellant (Decro Paint and

Hardware (Pty) Ltd) is to pay the costs of appeal, which shall include the costs of two counsel".

M M CORBETT MILLER JA)
NICHOLAS AJ)CONCUR.
GALGUT AJA)
HOWARD AJA)

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