Swanfu Trading Pte Ltd v Beyer Electrical Enterprise Pte Ltd

• Jurisdiction: Singapore
• Judge: Warren Khoo L H J
• Judgment Date: 18 February 1994
• Neutral Citation: [1994] SGCA 19
• Docket Number: Civil Appeal No 48 of 1992
• Date: 18 February 1994
• Year: 1994
• Published date: 19 September 2003
• Plaintiff Counsel: Tan Tee Jim (Allen & Gledhill)
• Citation: [1994] SGCA 19
• Defendant Counsel: Dedar Singh Gill (Drew & Napier)
• Court: Court of Appeal (Singapore)
• Subject Matter: Trade Marks and Trade Names,Rectification of register,Whether the word 'Swanfu' was essential feature of registered mark,Whether use must be substantial to constitute bona fide use,Words and Phrases,Whether burden shifts to respondent to prove use of trade mark once applicant provides some evidence of non-use,Proof of use in the course of trade,Application to expunge from register,Burden of proof,s 40(1)(b) Trade Marks Act (Cap 332),Whether trademark in bona fide use during relevant period,'Bona fide use',Whether sales of leftover goods constituted sales in the normal course of trade

Cur Adv Vult

This appeal is against the decision of the learned judicial commissioner Mr MPH Rubin (as he then was) on an application under s 40(1)(b) of the Trade Marks Act (Cap 332) (`the Act`) that the appellants` registered trade mark be expunged from the register for lack of bona fide use for a period of five years ending one month before the date of application. The learned judicial commissioner`s judgment is reported in [1993] 1 SLR 293 .

The relevant provisions of s 40(1)(b) read as follows:

(1) Subject to section 41 [which is not relevant], a registered trade mark may be taken off the register in respect of any of the goods or services in respect of which it is registered on application by any person aggrieved to the court, on the ground either -

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(b) that up to the date one month before the date of the application a continuous period of 5 years or longer had elapsed during which the trade mark was a registered trade mark and during which there was no bona fide use thereof in relation to those goods or services by any proprietor thereof for the time being:

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Several issues were raised in this appeal. In the view which we take on the issue whether the appellants could be said to have used the registered trade mark at all, the appeal would be dismissed on that ground, and there is no need to deal with the others. However, as much argument has been addressed to what constitutes bona fide use within s 40(1)(b), we propose to deal with that issue.

The application to expunge being made on 26 September 1991, the relevant period is taken to be the period between 26 August 1986 and 26 August 1991. It is not disputed that the respondents (`Beyer`) were an `aggrieved person` and therefore had the locus standi to apply under the section.

The facts

The uncontroverted facts are as follows. The mark was registered on 7 June 1977 in Class 11 in respect of gas rice cookers and gas cookers for a period of seven years, the prescribed period under the Act before its amendment in 1991. The registration was in the name of Sim Hock Tee and Sim Li Beng trading as Swanfu Trading Company, a firm. The mark is represented as follows:

From 1977 to the early 1980s, the mark, with the omission of the word `Swanfu`, was used quite extensively by the firm in relation to the goods for which it was registered. They were distributed by a related firm, Hiap Huat Trading Co.

According to the evidence of the appellants (`Swanfu`), in the early 1980s, because of falling demand, the firm ceased to import these goods, but existing stocks continued to be sold by Hiap Huat. The extent of the sale is a matter of controversy.

In February 1985, the registration of the trade mark was renewed for a period of 14 years from 7 June 1984. Swanfu Trading Co ceased to carry on business as of 14 April 1988, as shown in the records of the Registry of Businesses.

On 20 July 1991, the mark was assigned to Swanfu upon an application filed on 19 February 1990, together with three other registered trade marks. There is no evidence when Swanfu were incorporated. However, Mr Sim Hock Tee, a director of Swanfu, said that between December 1990 and July 1991 he made visits to Taiwan to locate manufacturers of home appliances, including gas cookers, with a view to importing them for sale in Singapore under the Aloha trade mark. Swanfu eventually placed an order on 20 July 1991 for US$106,125 worth of gas cookers of various models. The purchase order describes the goods as `Aloha gas cookers`. They arrived in several shipments in Singapore and Hiap Huat commenced marketing them under the registered trade mark (again without the word `Swanfu`).

No bona fide use issue

On the issue of bona fide use, the only evidence given for Beyer was a statement by Mr Thomas Yeo, their managing director, in his affidavit simply asserting that:

I am aware from my own knowledge of the gas cooker market that [Swanfu] have not made any bona fide use of the said registered mark for at least the last five years.

Mr Yeo said he should know because he had been the manager of the firm Aik Leong Electrical Enterprise from 1971 to January 1991 (except for four years from 1976 to 1980 when he was away for further studies in Hawaii). Aik Leong, and the company bearing that name which was incorporated to take over the firm`s business in January 1991, had been dealing in a large variety of home appliances including gas cookers and rice cookers, including a long list of brands which may be described as household names, eg National, Sharp, Sanyo, Mitsubishi and Philips.

It was part of his job as manager to ensure that there was an adequate retail market for these home appliances, and he had to visit retailers to canvass for sales and maintain goodwill.

In answer to Mr Yeo`s allegation that there had been no bona fide use of the mark for five years, Swanfu witnesses deposed as follows: Firstly, there was the evidence of Mr Sim that the mark was extensively used by Swanfu Trading Co in respect of gas rice cookers, gas cookers and gas stoves from 1977 until the early 1980s; that because of stiff competition and a fall in demand in the early 1980s the firm ceased to import any further goods bearing the registered mark. However, existing stocks of the goods continued to be sold by Hiap Huat until late 1986. An invoice dated 2 December 1986 by Hiap Huat showing the sale of four Aloha gas cookers for $25 each was produced. Secondly, there was the evidence of Lee Kia Koy that his firm purchased various appliances with the Aloha mark from Hiap Huat on one occasion each in the years 1985, 1986 and 1987 and two Aloha gas cookers in 1988. Thirdly, there was the evidence of another dealer Mr Lee Kai Teck that his firm Kong Ming Electric and Radio Service bought about 40 Aloha rice cookers from Hiap Huat, and he had sold all except two units. The last Aloha rice cooker had been sold in 1988, and there was one still on display. Fourthly, there was the evidence of Low Sai Huay whose firm Guan Huat Lee Jwee Kee sold Aloha gas cookers in 1987 to individual customers.

The learned judicial commissioner approached the issue as follows. Firstly, he held that the onus was on Beyer to establish, on a prima facie basis, absence of use during the relevant period. He cited the following passage from Windeyer J`s judgment in Estex Clothing Manufacturers Pty Ltd v Ellis and Goldstein Ltd :1

Slight evidence may suffice at this stage, for the applicant has the task of proving a negative and the registered proprietor is probably in a better

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