Brinks Incorporated v Brinks Pty Ltd [1997] PGNC 52; N1567 (9 May 1997)

Unreported National Court Decisions

N1567

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

W.S. NO. 810 OF 1994
BETWEEN
BRINKS INCORPORATED - FIRST PLAINTIFF
BRINKS AIR COURIER AUSTRALIA PTY LTD - SECOND PLAINTIFF
AND
BRINKS PTY LTD - FIRST DEFENDANT
AND
BARRY TAN - SECOND DEFENDANT
AND
HERMAN LUCAS - THIRD DEFENDANT

Waigani

Injia J
9 May 1997

PASSING-OFF - Foreign Companies not based in the country carrying on business in the country using resident sub-contractor - Security service business using name “Brinks’” - Local security service company using “Brinks” as part of its corporate and business name - Whether Local company guilty of passing-off foreign company’s business.

UNDERLYING LAW - Common law and equity - Passing-off action - Principles considered appropriate and applicable to circumstances of country - Adopted and applied - Constitution, Sch. 2.2.

The First Plaintiff, a security service company based in Connecticut, USA owned a group of Companies throughout the world including the Second Plaintiff which was based in Sydney, Australia. All these companies used the name “Brinks” or Brink’s” as part of their corporate name or business name. The Plaintiffs carried on the business of transporting valuables such as currency and gold in PNG using a resident sub-contractor, PNG Armoured. The First Plaintiff had an agreement with PNG Armoured but did very little or no business directly with PNG Armoured. The Second Plaintiff had agreement with several resident Companies to transport valuables into and out of PNG. Although the Second Plaintiff did not have an agreement with PNG Armoured, all business for the Second Plaintiff was carried out by PNG Armoured. The Plaintiffs did not obtain incorporation, registration or certification as a foreign enterprise under the existing laws of PNG. The Second Defendant was at one time employed by PNG Armoured as it’s Managing Director and did some work for the Second Plaintiff. Later he left his employment and with the financial assistance of the Third Defendant, incorporated the First Defendant company and registered two other business names known as “Brink’s Armoured” and “Brinks Security Services” and went into various businesses, one of which was similar to that provided by the Plaintiffs through PNG Armoured. In a passing-off action by the Plaintiffs, they sought permanent injunction (and damages) to stop the Defendants from carrying on business using the name “Brink”, “Brinks” or “Brink’s”.

Held

1. A Passing-off action is an action in equity which is enforceable by an injuction and a party seeking equitable remedy of a permanent injunction must come with clean hands. The Plaintiffs in carrying on business in the country without obtaining registration as a foreign enterprise under Part XII Division 3 of the Companies Act (Ch. 146) and certification under the Investment Promotion Act 1992 were committing criminal offences for which they stood liable to be prosecuted whereas the defendants had not broken any laws because they had obtained incorporation of the company and registered their business names under the Companies Act and Business Names Act (Ch. No. 145) and were entitled to carry on business under their registered corporate or business names. The action should be dismissed because the plaintiffs had not come with clean hands.

2. The First Plaintiff had not acquired a reputation or goodwill in the country which it could protect by a passing-off action because it had not carried on any or sufficient business in the country to establish a reputation or goodwill; that the defendants had not misrepresented to the public in the country including the First Plaintiff’s customers or potential customers that their business was that of the First Plaintiff, and that no damages were actually suffered or likely to be suffered by the Plaintiffs as a result of the defendant’s use of the name “Brinks”. The action of the First Plaintiff should be dismissed.

3. The Second Plaintiff had acquired a reputation or goodwill in the country in the use of the name “Brinks” or “Brink’s” as attaching to the provision of high quality security services, in particular, the provision of armoured car security services in the transportation of valuables, but because the defendants had not misrepresented to the public in PNG or the Plaintiffs’ customers or potential customers that the services they were providing was that of the Second Plaintiff or in anyway associated with the Second Plaintiff, and because the Second Plaintiff had not actually suffered any damage or likely to suffer any damage as a result of the use of the name “Brink’s” or “Brinks”, the action should be dismissed.

Cases Referred to in the Judgement

Scott v Brown Doering McNab & Co. [1892] UKLawRpKQB 170; [1892] 2 QB 724

Reddaway v Bonham [1895] ALL ER 133

Inland Revenue Commissioner v Muller & Co.’s Margarine Ltd [1901] UKLawRpAC 20; [1901] AC 217

Panhard v Panhard [1901] UKLawRpCh 130; [1901] 2 Ch 513

Gibson Battle & Co Ltd v James King & Sons [1915] SASR 15

AG Spalding & Bros v AW Gamage Ltd (1915) 84 LJ (Ch. 449)

Poiret v Jules Poiret Ld and AF Nash [1920] 37 RPC 177

Concrete Engineering and Contracting Company Limited v Hardie Trading Propriety Limited [1928] SAStRp 35; [1928] SASR 132

Snell v Unity Finance Ltd [1963] 3 ALL ER 50

Sheraton Corp. of America v Sheraton Motels Ltd [1964] RPC 202

Suhner & Co. AG v Suhner Ltd [1967] RPC 336

The Crazy Horse Case [1967] RPC 581

Alain Bernadin et Compagnie v Pavilion Properties Limited

Globelegance BV v Sarkissian [1974] RPC 603

Baskin Robbins Ice Cream Co. and Another v Gutman and Another [1977] FSR 545

Star Industrial Company Limited v Yap Kwee Kor (trading as New Industrial Company) [1976] FSR 256

HP Bulmer Ltd v Bollinger SA [1978] RPS 79

Erven Warnink B and Others v J Townend & Sons (Hull) Ltd and Others [1979] 2 ALL ER 927

Habib Bank Ltd v Habib Bank AG Zurich [1981] 2 ALL ER 650

Reckitt & Colman Products Ltd v Borden Inc. and Others [1990] UKHL 12; [1990] 1 ALL ER 873

Taittinger and Others v Allbeu Ltd and Others [1994] 4 ALL ER 75

Counsel

CR Hudson for the Plaintiffs

D Hill for the Defendants

9 May 1997

INJIA J: The Plaintiffs’ action is based on the common law tort of passing-off. The Plaintiffs seek permanent injunctions and damages. The case involves the use of the name “Brink”, “Brinks” or “Brink’s”.

1. BACKGROUND OF THE CASE

The essence of the Plaintiff’s claim is this. The First Plaintiff is a company incorporated, registered and based in Connecticut, USA. The Second Plaintiff is an Australian company incorporated, registered and based in Sydney. The Second Plaintiff is wholly owned by the First Plaintiff and regarded as a “subsidiary” of the First Plaintiff. The First Plaintiff claims that it has carried on business using the name “Brinks” in USA since 1865 in the business of providing security services throughout USA and in a large number of countries throughout the world under the name “Brinks”. The First Plaintiff claims it has a series of companies registered throughout the world of which the Second Plaintiff is one. Both plaintiffs claim that they have carried on business in Papua New Guinea (PNG) continuously since 1988. They claim that even though they are not incorporated and/or registered in PNG, they have carried on business using their PNG agent or sub-contractor, namely PNG Armoured. They say that as part of their international reputation or goodwill, by conducting business in PNG through PNG Armoured, they have acquired a reputation or goodwill in PNG in the name “Brinks”. They claim that the Second Defendant was at one time a Managing Director of PNG Armoured and was performing the services required by the plaintiffs on behalf of PNG Armoured. He left the company in 1994 and he used his business knowledge of the plaintiff to set up the First Defendant company and registered the business names “Brinks Armoured” and “Brinks Security Services”. Financial backing for the business was provided by the Third Defendant. The plaintiffs say the defendants are carrying on business similar to that of their own and this is creating confusion in the minds of the public in PNG, among their existing and potential customers throughout PNG. They claim that the defendants are misrepresenting to the public in PNG that the services they are providing are that of the Plaintiffs or are associated with the plaintiffs. They claim that as a result, the plaintiffs are likely to suffer damages to their business in PNG unless the defendants are permanently restrained from using the name by this court.

The defendant’s defence in essence is that they admit that they have incorporated the First Defendant company and registered the said two (2) business names and are carrying on business in PNG of providing security services, some of which are similar to those of the Plaintiffs. They say the Plaintiffs have no reputation or goodwill in PNG which is capable of being protected by a passing-off action. They deny any misrepresentation involved and any likelihood of damages. They say that they are entitled to conduct business in PNG under their corporate name and style and under their two (2) registered business names because they have complied with the relevant laws of PNG as to incorporation and registration. They say the plaintiffs do not have any right to carry on business in PNG because they have failed to comply with relevant laws of PNG requiring registration of foreign companies, registration of business names, etc.

2. LAW ON PASSING-OFF

Before I deal with the issues relating to the pleadings, some objections taken by the defendants taken as to the competency of the proceedings and the evidence, it is necessary to set out the principles relating to the tort. There is no statutory law governing the tort of passing-off. There is also no case precedent on the tort in PNG. Both parties agree that the principles of common law and equity in England as adopted under Schedule 2.2 of the Constitution should be adopted and applied. As there is general consensus between the parties as to what those principles are, I set out those principles.

Generally speaking, “passing-off” means a misrepresentation made by one trader which is calculated to give that trader the business benefit of another trader’s goodwill or reputation. Passing-off is an actionable tort.

The development of this tort in the equity courts of England goes back to the mid 19th century. Although there have been many cases with different pronouncement of the principles, the basic principles developed in the earlier decisions have remained essentially unchanged to this day. I would prefer the description of the action of passing-off given by Buckley LJ in HP Bulmer Ltd v Bollinger SA [1978] RPS 79 at p. 93-95:

“To succeed on this part of the appeal the respondents must establish that the appellants have committed the tort of passing-off, a form of civil actionable wrong which does not depend upon any legislation but it recognised as an actionable wrong by the general law of the land. A man who engages in commercial activities may acquire a valuable reputation in respect of the goods in which he deals, or of the services which he performs, or of his business as an entity. The law regards such a reputation as an incorporeal piece of property, the integrity of which the owner is entitled to protect. This does not, of course, mean that he is entitled to protection against legitimate competition in the market. If A’s goods have acquired a reputation on the market connected with a particular name, mark or get-up, A cannot complain if the value of that reputation is depreciated by B coming on to the market with similar goods which acquire a reputation which owes nothing to the name, mark or get-up associated with A’s goods. A can, however, complain if B in the course of his operation uses in connection with his goods the name, mark or get-up associated with A’s goods or one so closely resembling it as to be likely to lead to confusion on the market between the goods of A and those of B. By so doing B wrongfully appropriates to himself part of the reputation belonging to A and so infringes the integrity of A’s property in that reputation. This proprietary right recognised by the law as to a right in the name, mark or get-up is the badge or vehicle: Singer v Loog ([1880] 18 Ch.D395 at 12), per Lord Justice James; ([1882] 8 App. Cas 15 at 26-27, 38-39), per Lord Chancellor Selborne; Lord Watson; Burberrys v Cording ([1909] 26 RPC 693 at 701), per Parker, J; AG Spalding Bros v AW Gamage Ltd. ([1915] 84 LJ Ch. 449 at 450) per Lord Parker. Upon analysis it seems to me to be clear that in principle this must be so. If B has made use of a name, mark or get-up which has become distinctive of A’s goods, B does not damage or interfere with A’s right or ability to use that name, mark or get-up but he does or may be likely to damage A in respect of his trade, that is to say, in respect of his, A’s enjoyment of an exclusive right to make use of the market of the reputation of his goods. What is damaged or liable to be damaged is that reputation. It is this which A is entitled to have protected. If B sells goods which are not A’s goods in such a way as to give the impression that they are A’s goods, A may be injured in respect of his trade in either or both in two ways. He may lose sales of his own goods which he might otherwise have made, and the reputation which his goods enjoy may be depreciated by the confusion of B’s goods with his so that A’s competitive position in the market may be weakened. Moreover the exclusivity of the association of the name, mark or get-up with A’s business might, perhaps, be shown to be itself a valuable asset as a powerful means of bringing A’s goods to the notice of the public, thus maintaining and promoting A’s competitive position on the market. It has not, however, been suggested that modern advertising techniques have made it possible for a name to acquire an intrinsic value of it’s own as an advertising asset. Such a suggestion (if feasible at all in any case) would have to be supported by evidence of a kind which is wholly absent from and would seem to me most unlikely to be available in, the present case. I accordingly proceed upon the established basis (see the cases just cited) that a claim to relief against passing-off cannot be based upon an alleged right of property in a name, nor in the mark or get-up. It is injury, or the likelihood of injury, to the reputation of A’s goods or business, that is to say his goodwill, that founds the cause of action. If B’s conduct has not the effect of damaging, or being likely to damage A in respect of his trade, B is not guilty of the tort of passing-off. [He then referred to authority and continued:] Goodwill is undoubtedly a form of property. It is, in my judgement, against infraction of this incorporeal property that the law will protect a plaintiff in a passing-off action. So I think in the present case one should keep prominently in mind the question whether what the plaintiff’s have done (for, having regard to the form of the present action, the roles of the plaintiffs and the defendants are the reverse of what is usual) has injured or is likely to injure the defendants in their trade as maker of Champagne.”

The above principles were re-affirmed by the Court of Appeal in Taittinger and Others v Allbev Ltd and Others [1994] 4 All ER 75 at 92-93, per Sir Thomas Birmingham MR. Sir Bingham went further to expound on the misrepresentation element of passing-off as follows:

“Although there have, since his judgment, been other summaries of the ingredients of the cause of action in passing-off, notably in the speeches of Lord Diplock and Lord Fraser in Erven Warnink BV v J Townend & Sons (Hull) Ltd [1979] 2 All ER 927 at 932-933, 943-944, [1979] AC 731 at 742, 755-756, the ruling of Buckley LJ has ever to my knowledge been criticised, varied or superseded. But it is now, as I understand, clear that a defendant need not, to be liable, misrepresent his goods to be those of the plaintiff if he misrepresents his goods or his business as being in some way connected or associated with the plaintiffs.”

In the Erven Warnink’s case, the House of Lords discussed at length the elements that need to be proved by the plaintiff in a passing-off action in terms of five (5) elements. Lord Diplock identified those elements at p. 932-933 as follows:

“My Lords, AG Spalding and Bros v AW Gamage Ltd and the later cases make it possible to identify five (5) characteristics which must be present in order to create a valid cause of action of passing-off: (1) a misrepresentation; (2) made by a trader in the course of trade; (3) to prospective customers of his or ultimate consumers of goods or services supplied by him; (4) which is calculated to injure the business or goodwill of another trader (in the sense that this is a reasonably foreseeable consequence); and (5) which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so.”

Lord Fraser at p. 943 put it this way:

“But the decision [the Champagne’s Case] is in my opinion, secondly based on the principles underlying the earlier passing-off actions, which I take to be that the plaintiff is entitled to protect his right of property in the goodwill attached to a name which is distinctive of a product or class of products sold by him in the course of his business. It is essential for the plaintiff in a passing-off action to how at least the following facts: (1) That his business consists if, or includes, selling in England a class of goods to which the particular trade name applies; (2) That the class of goods is clearly defined, and that in the minds of the public, or a section of the public, in England, the trade name distinguishes that class from other similar goods; (3) That because of the reputation of the goods, there is goodwill attached to the name; (4) That he, the Plaintiff, as a member of the class of those who sell the goods, is the owner of goodwill in England which is of substantial value; (5) That he has suffered, or is really likely to suffer, substantial damage to his property in the goodwill by reason of the Defendants selling goods which are falsely described by the trade name to which the goodwill is attached.”

In the more recent case of the House of Lords in Reckitt & Colman Products Ltd v Borden Inc. and Others [1990] UKHL 12; [1990] 1 All ER 873, the court discussed the elements that need to be proved. Halsbury’s Laws of England, 18th volume. Fourth Edition, (Butterworths, London, 1995) summarises the elements discussed in Reckitt’s case as there being really three (3) essential elements requiring proof. They are:

1. That the plaintiff’s goods or services have acquired a goodwill or reputation (both of which mean the same thing) in the market and are known by some distinguishing feature;

2. That there is a misrepresentation by the defendant (whether or not international) leading or likely to lead the public to believe that goods or services offered by the defendants are goods or services of the plaintiff; and

3. That the plaintiff has suffered or is likely to suffer damages as a result of the erroneous belief engendered by the Defendant’s misrepresentation.

I would agree with both counsels in this present case that there are essentially these three (3) elements in passing-off. It is now necessary to set out in some detail what each of these three elements involve insofar as those principles relate to the facts of the present case.

(a) Reputation or goodwill

Of the three (3) elements, the first element has attracted much diversity of judicial opinion as to what it is really meant to protect. This is more so where the reputation or goodwill is built around or attached to a business name, trade mark or get-up. These controversies were settled by the House of Lords in two cases. In Erven Warnink’s case, at p. 94 the House of Lords, per Fraser LJ, quoted with approval the following passage of Lord Fraser in AG Spalding and Bros v AW Gamage Ltd [1915] RPC 84:

“There appears to be considerable diversity of opinion as to the nature of the right, the invasion of which is the subject of what are now known as passing-off actions. The more general opinion appears to be that the right is a right of property. The view naturally demands an answer to the question - property in what? Some authorities say property in the mark, name or get-up improperly used by the defendant. Others say, property in the business or goodwill likely to be injured by misrepresentation. Lord Herchell in Reddaway v Banham expressly dissents. From the former view; and if the right invaded is a right of property at all, there are, I think strong reasons for preferring in later view.”

Lord Parker’s statement was also quoted with approval by the House of Lords in star Industrial Co. Ltd v Yap Kwee Kor (trading as New Industrial Co.) [1976] 1 FSR 256 of 269 where Lord Diplock said:

“Whatever doubts there may have previously been as to the legal nature of the rights which were entitled to protection by an action ‘for passing-off’ in courts of law or equity, they were laid to rest more than 60 years ago by the speech of Lord Parker of Waddington in AG Spalding & Bros v AW Gamage Ltd. with which the other members of the House of Lords agreed. A passing-off action is a remedy for the invasion of a right of property not in the mark, name or get-up improperly used, but in the business or goodwill likely to be injured by the misrepresentation made by passing-off one person’s goods as the goods of another.”

It is clear from these principles that a mere complaint by the plaintiff that his name is being used by the defendant will not be sufficient. The plaintiff must also establish the goodwill or reputation associated with the use of that name. And reputation or goodwill is:

“It is the benefit and advantage of the good name, reputation and connection of a business. It is the attractive force which brings in customers. It is the one thing which distinguishes an old established business from a new business at it’s first start. The goodwill of a business must emanate from a particular centre or source. However, widely extended or defused it’s influence maybe, goodwill is worth nothing unless it has power of attraction sufficient to bring customers home to the source from which it emanates.” (Inland Revenue Commissioner v Muller & Co. Margarine Ltd. [1901] UKLawRpAC 20; [1901] AC 217 at p. 223 and 224, per Lord McNaghtern).

Where a foreign company is seeking to protect it’s reputation or goodwill in another country the question arises as to what the plaintiff has to prove. There has been diversity of judicial opinion in English courts on this issue. This is apparent from the decisions in Panhard v Panhard [1901] UKLawRpCh 130; [1901] 2 Ch. 513; Poiret v Jules Poiret Led and AF Nash [1920] 37 RPC 177, Sheraton Corp. of America v Sheraton Motels Ltd [1964] RPC 202; Suhner v Suhner [1967] RPC 336; Alain Bernardin et Compagnie v Pauilion Properties Limited (The Crazy Horse) case [1967] PRC 581; Baskin - Robbins Ice Cream Co. and Another v Gutman and Another [1977] FSR 545 and Globelegance BV v Sarkissian [1974] RPC 603.

From reading all these cases together, the Globelegance case appeal to me to be sound and appropriate to the circumstances of this country: Constitution, Sch. 2.2. That is, the principle that where a foreign company relies on the use of a business name, mark or get-up, it must show that the name, mark or get-up has become a “user” in this country which is distinctive of the Plaintiff’s goods or services so that the provision of goods or services of the kind dealt with by the plaintiff of that name will be understood by the trade and public in that country as meaning that the services are that of the plaintiff. “User” refers to the business activities of the foreign trader in the country using that name, mark or get-up. This principle was first enunciated by Pennyquick J in The Crazy Horse case. Pennyquick J. expounded the “user” principles at p. 548 in these words:

“The statement in the judgement of Jenkins LJ [in Oerli AG v Bowman (London) Ltd [1957] RPC 388 397) which I have just read unequivoically requires user to be this country. That it seems to me is what one would expect: that a trader cannot acquire goodwill in this country without some sort of user in this country. His user may take many forms and in certain cases very slight activities have been held to suffice. On the other hand, I do not think that the mere sending in to this country by a foreign trader of advertisements advertising establishment abroad could fairly be treated as user in this country. No authority to that effect has been cited. If that were so, the range of the action of passing off would be extended far beyond anything which has hitherto been treated in it’s proper scope. That observation applies I think particularly to such establishments as hotels and even more to restaurants. It may well be that the owner of a foreign hotel or restaurant acquires in this country a reputation for the name of his hotel or restaurant in the wide sense, that the travel agents or other persons to whom he sends advertisements know of his establishment. Again he may acquire a reputation in a wide sense in the sense of returning travellers speaking highly of that establishment, but it seems to me that those matters, although they may represent reputation in some wide sense, fall far short of user in this country and are not sufficient to establish reputation in the sense material for the purpose of a passing off action. It is very clear that in such circumstances the foreign trader has not acquired anything which in law could be described as goodwill in this country.”

The “user” principle in my view is another term for carrying on business in the country sufficient to establish a reputation or goodwill in that country. It is those business activities in that country which gives a foreign company the goodwill or reputation, a property right, which gives title in the plaintiff to bring an action for passing-off. As Templeman J said in Globelegance case at p. 612-613:

“The user in this country, on the present evidence, consists of the activities of selling patterns to Debenham and Freebody, and they in turn making dresses from patterns on which the name of ‘Valentino’ is put on the label, and in selling ties to the establishments I have mentioned. There were two (2) other activities where I know not whether business was actually done, but certainly in 1966 and 1968 one finds fashion shows, although, the last one is in 1968. They are a little on the lines of Poiret. In my judgement, adding these things together and having regard to the fact that when it comes to deciding whether a Plaintiff can get his case off the ground and have anything to protect what he has to do is to show some user in this country, those three (3) users establish title in the plaintiffs to bring an action for passing off if the necessary conditions are fulfilled, namely if they can show that the defendants are in fact, innocently maybe, passing off.”

(b) Misrepresentation

Misrepresentation in the context of a passing-off action is defined as to represent the goods or services of another as that of his and thereby deceive the customer into thinking that the goods and services he is receiving is that of the other. Where the plaintiff complains of the use of a name, mark or get-up, the plaintiff must not only show that the defendant used the name, mark or get-up but also prove that in doing so the Defendant was putting off the goods or services as that of the plaintiff. Lord Herscheel in Reddaway v Bonham [1895] All ER Rep. 133 at 140 expressed the meaning of misrepresentation in the context of the use of a name to identify one’s business in following terms:

“The name of a person, or words forming part of the common stock of language, may become so far associated with the goods of a particular maker that it is capable of proof that the use of them by themselves without explanation or qualification by another manufacture would deceive a purchaser into the belief that he was getting the goods of A when he was really getting the goods of B. In a case of this description the mere proof by the plaintiff that the defendant was using the name, word, or device which he had adopted to distinguish his goods would not entitle him to any relief. He could only obtain it by proving further that the defendant was using it under such circumstances or in such manner as to put off his goods as the goods of the plaintiff. If he could succeed in proving this I think he would, on well-established principles, be entitled to an injunction.”

Misrepresentations made to the public about one’s goods or services as distinct from those of another competitor in a free market or capital economy is permissible. Statements which are untrue made by a trader in a free market place may also be permitted and may not be the basis of an action for passing-off even if they lead the receiver of the statement to suffer damages. As Lord Diplock in Erven Warnink’s case at p. 933 said:

“In an economic system which has relied on competition to keep down prices and to improve products there may be practical reasons why it should have been the policy of the common law not to run the risk of hampering competition by providing civil remedies to everyone competing in the market who has suffered damage to his business or goodwill in consequence of inaccurate statements of whatever kind that may be made by rival traders about their own wares. The market in which the action of passing-off originated was no place for the mealy mouthed: advertisements are not on affidavit; exaggerated claims by a trader about the quality of his wares, assertions that they are better than those of his rivals, even though he knows this to be untrue, have been permitted by the common law as venial ‘puffing’ which gives no cause of action to a competitor even though he can show that he has suffered actual damage in his business as a result.”

Lord Fraser at p. 944 said:

“Of course, any established trader is liable to have his goodwill damaged by fair competition, and it is not every falsehood told by a competitor that will give him a right of action. But where the falsehood is a misrepresentation that the competitor’s goods are goods of definite class with a valuable reputation, and where the misrepresentation is likely to cause damage to established traders who own goodwill in relation to that class of goods, business morality seems to require that they should be entitled to protect their goodwill.”

(c) Damages

The plaintiff must prove that he has suffered damages or likely to suffer damage as a result of the misrepresentation made by the defendant. Where the defendant has not yet commenced business, the plaintiff must prove that it is likely to suffer damage such as likely loss of existing business customers or potential customers, confusion in the market place leading to customer’s or potential customers being driven away over to the Defendant or some other competitors, etc. This is a little more difficult to prove as the plaintiff will have or provide evidence of the unforseen. The court will allow the plaintiff to succeed here so long as the damages are reasonably foreseeable or in the words of Lord Fraser in Erven Warnink’s case, where the Plaintiff is “really likely to suffer” damage.

Where the defendants have been carrying on business using the name, mark or get-up for some time, the courts will expect the plaintiff to produce some evidence of actual loss to render weight to it’s claim. In certain circumstances, mere speculative evidence of likely loss or damage alone may not suffice. The standard of proof of actual damage or likely damage is higher here than in a situation where the defendant has not yet commenced business. In Habib Bank Ltd v Habib Bank AG Zurich [1981] 2 ALL ER 650 at 663, for instance, Lord Oliver described the standard of proof as follows:

“But here there really was no evidence of any damage of any significance over the whole period since nationalisation. The witnesses called by the Plaintiffs to establish the probability of confusion seem, judging from the transcripts, from the plaintiffs point of view to have been disappointingly vague. It has to be remembered that these two bank’s had been trading together in London for three and a half years before the issue of the writ and nearly six years at the date of the hearing. Yet there was not one atom of evidence of any customer who had opened an account at one in mistake for the other, apart from one case in which a gentleman who had opened an account with the Defendants had subsequently closed it and transferred his business to the Plaintiffs. Since he had previously transferred part of the moneys in his account with the Defendants to an account opened with the Plaintiffs before finally closing his account with the Defendants, this may import dissatisfaction but it hardly looks like a case of confusion. All the other evidence of confusion related to a decreasing amount of postal confusion (much of which was accounted for by carelessness on the part of the Post Office), telex confession by junior banking staff, and a decreasing quantity of credits or debits to the wrong banks, which were swiftly rectified without loss, although this may have caused some slight administrative inconvenience on both sides. But the evidence did indicate that errors of this sort did occur, though much less frequently, even with other banks.”

I am of the view that these principles of common law on the tort of passing-off are appropriate and applicable to the circumstances of this country. I see no reason why the tort should not be recognised and enforced in our jurisdiction as part of the underlying law. PNG is a member of the Commonwealth of nations, a democratic country and a member of the free market economy countries of the world such as Australia, USA, and Europe. In the absence of any Statutory provision which defines, modifies or restricts the tort of passing-off in this country, I see no reason for not recognizing and applying the tort and the principles associated with the tort as I have outlined above.

3. PRELIMINARY OBJECTIONS AS TO JURISDICTION AND COMPETENCY OF PROCEEDINGS

It is clear from the evidence, and this is not disputed by the plaintiffs, that both plaintiffs were not incorporated in PNG under provisions of the Companies Act Ch. No. 146 and in particular registered as a foreign Company under Part XII, Div. 3 of that Act. It is not disputed that the plaintiffs have never registered the name “BRINK,” “BRINKS” or “BRINK’S” under the Business Names Act Ch. No. 145. It is also not disputed that the name “BRINK,” “BRINKS” or “BRINK’S” with it’s associated trade mark has never been registered under the Trade Marks Act Ch. No. 385. Finally, it is not disputed that the plaintiffs never obtained certification as a foreign enterprise carrying on business in PNG under provisions of the Investment Promotion Act 1992 (abbreviated IPA Act).

The defendants submit that the plaintiff’s failure to comply with the requirements of these various statutes shows that the plaintiffs were not based in PNG and therefore, they have no locus standi to sue the defendants in PNG. Alternatively, the defendants submit the plaintiffs were carrying on business in PNG illegally and therefore, the court in the exercise of it’s equitable jurisdiction and discretion should not allow the plaintiffs to succeed in an action for passing-off.

(a) Plaintiffs’ Locus Standi to Sue in PNG

It is submitted for the plaintiffs that it is not a pre-condition to the commencement of an action for passing-off in this country that they be based in this country in terms of complying with this country’s laws relating to registration etc of foreign companies. They submit the tort of passing-off is based on the reputation or goodwill acquired by the Plaintiffs in PNG through conducting business in PNG.

In my view, the standing of a foreign company to sue in another jurisdiction is a matter for the legislature to provide for by statutory legislation. In the absence of any statutory provision, the principles of the common law and equity will apply.

In PNG the Companies Act and other pertinent commercial legislation’s in PNG do not provide for locus standi of foreign companies or enterprises not registered or incorporated in PNG but conducting business in PNG, to sue in PNG. This is different from some other countries of the free market economies such as Australia where for instance, the Companies Act 1892 of South Australia prevents a foreign company not registered in the jurisdiction (in South Australia) under Part VIII of the Companies Act from maintaining an action. Section 201 (2) of that Act provides:

“If any foreign company shall carry on business contrary to that Act, the validity of any contracts, dealings or transactions in relation to such business shall not be affected by this part of the Act, but such company shall not be entitled to bring or maintain any action, set-off, counter-claim or legal proceedings in respect of any such contracts, dealing or transaction until it shall have complied with this part of Act.” (underlining is mine).

See Gibson Battle & Co. Ltd v James King & Sons [1915] SASR 15 and Concrete Engineering and Contracting Company Limited v Hardie Trading Propriety Limited [1928] 5 ASR 132.

The principles of common law and equity on passing-off clearly gives locus standi to a foreign company conducting business in PNG to sue a resident company or person in a country in which the Foreign Company carries on business without first being registered, incorporated or based in that country. That is the whole essence of a passing-off action - a foreign company’s ability to sue in any country of the market economy to protect it’s reputation or goodwill.

In the absence of any statutory provision in this country equivalent to that of South Australia, I see no reason why the plaintiffs should not be allowed to sue in PNG in a passing-off action.

(b) Illegality

(i) Pleadings

The defendants never pleaded illegality as a special defence to the plaintiff’s claim as required by Order 8, Rule 14 of the National Court Rules. At the commencement of the hearing, there was an attempt made by the Defendants to amend the defence to plead illegality but this was not pursued to finality even though I left it open for the Defendants to seek to amend the defence at any time of the proceedings. Also at the hearing, despite objections from the Plaintiffs, I allowed the Defendants to cross-examine the Plaintiffs’ witnesses as to the legality of their business activities in PNG in terms of compliance with the Companies Act, IPA Act, Business Names Registration Act, Income Tax Act Companies Act, etc. The Plaintiffs’ witnesses did make some admissions in respect of non-compliance with some of these laws. At the end of the evidence however, the Defendants did not pursue their application to amend the defence to conform with the answers adduced in cross-examination.

In their submissions, the Defendants go at length to address on the illegality of the Plaintiffs’ business in this jurisdiction and submit that the Court should not allow the Plaintiffs to succeed on their claim because they failed to comply with the relevant laws. They say the Court has a discretion to refuse a Plaintiff the remedies sought if it failed to comply with the relevant laws of the country in which they carry on business. In support, they rely on a statement from C. Waldem, The Law of Passing-off at p. 289-390 which says:

“The Plaintiff in a passing-off action cannot claim the protection of a Court of justice for whatever is illegal, fraudulent or deceptive. As the property protected by a passing-off action is the goodwill the Plaintiff has in his business, the rule applies where the relevant class of the Plaintiff’s business is illegal or a fraud upon the public.”

The Defendants also rely on the following passage of Lord Mansfield in Holman v Johnson [1775] Cowp 343:

“The principle of public policy is that; ex dolo malo non oritur actio. No Court will lend it’s aid to a man who founds his cause of action upon an immoral or an illegal act. If, from the Plaintiff’s own standing or otherwise, the cause of action appears to arise ex turpi causa, or the transgression of a positive law of this country, then the Court says he has no right to be assisted. It is upon that ground the Court does, not for the sake of the Defendant, but because they will not lend their aid to such a Plaintiff. So if the Plaintiff and Defendant were to change sides, and the Defendant was to bring his action against the Plaintiff, the latter would then have the advantage of it; for where both are equally in fault, potior ost conditio defendants.”

The by the English Court Defendants further rely on a statement of principle of Lindley, LJ in Scott v Brown Doering McNab and Co. [1892] UKLawRpKQB 170; [1892] 2 QB 724 at 728 which followed the principles of Lord Mansfield in Holman v Johnson, ante. Lindley, LJ’s statement was subsequently quoted with approval Appeal in Snell v Unity Finance Ltd [1963] 3 ALL ER 50. Lindley, LJ in Scott’s case said:

“No Court ought to enforce an illegal contract or allow itself to be made the instrument of enforcing obligations alleged to arise out of a contract or transaction which is illegal, if the illegality is duly brought to the notice of the Court, and if the person involving the aid of the Court is himself implicated in the illegality. It matters not whether the Defendant has pleaded the illegality or whether he has not. If the evidence adduced by the plaintiff proves the illegality, the Court ought not to assist him. If authority is wanted for this promotion, it will be found in the well know judgment of Lord Mansfield in Holman v Johnson [1775] EngR 58; [1775], 1 Cowp. 341.”

The Defendants submit that even if the defence of illegality is not pleaded, the Court still has a discretion to consider the evidence and if satisfied that the Plaintiff has not complied with the relevant laws, refuse the remedy sought.

The Plaintiffs strenuously object to the Defendants’ relying on the defence of illegality. They say because illegality was never pleaded and leave was never sought to amend the defence to plead illegality at any stage of the proceedings, the Defendants are preluded from relying on that defence. The Plaintiffs rely on various provisions of the National Court Rules including Order 8 Rule 14 which provide:

“In a defence or subsequent pleading the party pleading shall plead specifically any matter, for example, performance, release, any statute of limitation, fraud, or any fact showing illegality:

(a) which he alleges makes any claim, defence or other case of the opposite party not maintainable;

(b) which, if not pleaded specifically, may take the opposite party by surprise; or

(c) which raises matters of fact not arising out of the preceding pleadings.”

The Plaintiffs further submit that as there was no pleadings as to the defence of illegality and leave not having been sought by the defendants, the court should not entertain any evidence of illegality adduced by the defendants and written submissions on the point by the Defendants.

Generally speaking, under Order 8 Rule 14, the court may cannot allow a defendant to raise a defence to a claim which he has not pleaded because the Court and in particular the plaintiff would be caught by surprise. However, the Court has a discretion to waive or dispense with the requirements of this rule in appropriate cases: Order 1 Rule 7. Where the matter sought to be raised in defence to the claim is one of illegality, the court may allow the defendant to raise the defence at the end of the evidence even if he has not pleaded it. And matters of legality in terms of compliance with statutory laws of the country are matters the court ought to know about. It is not entirely up to parties to prevent the court from knowing about matters of legality by pleading or otherwise. It is on this basis that I previously allowed the defendants to raise the issue by adducing evidence in cross examination. For the same reasons, I allow the plaintiffs to raise illegality as a defence to the plaintiff’s claim at the end of the evidence.

The defendants rely on the illegality of the plaintiffs business in two respects: (1) that in the exercise of the court’s discretion, the court should refuse the remedy sought on equitable grounds. (2) that the plaintiff’s did not acquire a reputation or goodwill in PNG because by doing business in PNG illegally, they demonstrated that they were not reputable companies. Accordingly, the first element of passing-off has not been made out and the whole action should be dismissed. The first point requires careful consideration on it’s own whereas the second point may be considered when I consider the reputation or goodwill element of passing-off.

The action of passing-off is founded in equity and is enforceable by an injunction, interim, permanent or mandatory. A plaintiff seeking this equitable remedy must come with clean hands. If the plaintiff is guilty of violating a country’s internal laws designed to protect trade within it’s territorial jurisdiction, depending on how serious those violations are, the court may refuse the remedy sought. The question is whether the plaintiffs are guilty of committing breaches of the relevant commercial laws of this country of such magnitude and severity that they should be denied the remedy sought by an action for passing-off. In order to determine this issue, it is necessary to examine the laws alleged to have been breached by the plaintiffs.

The Companies Act, Part VIII, Division 3 deals with foreign companies. It provides for a system of registration of foreign companies carrying on business in PNG.

Section 358 (I) provides that a:

“foreign company must within one month after it establishes a place of business or commence to carry on business within PNG, lodge with the Registrar for registration:

(a) a certified copy of the certificate of it’s incorporation or registration of business, it’s place of incorporation or origin, or a document of similar; and

(b) a certified copy of it’s charter, statute, memorandum, memorandum and articles or other instrument constituting or defining it’s constitution; and

(c) a list, in the prescribed form, of it’s directors, containing similar particulars with respect to it’s directors as are required by this Act to be contained in the register of the directors, managers and secretaries of a company incorporated under this Act; and

(d) where the list includes directors resident in PNG who are members of the local board of directors, a memorandum duly executed by or on behalf of the foreign company stating the powers of the local directors; and

(e) a memorandum of appointment or power of attorney under the seal of the foreign company or executed on it’s behalf in such manner as to be binding on the company and verified by statutory declaration in the prescribed manner, (other then foreign companies) resident in PNG and authorized to accept on it’s behalf service of process and any notice required to be served on it; and

(f) notice in the prescribed form of the situation of it’s registered office in PNG and, unless the office is open and accessible to the public for at least five hours between 10a.m. and 4 p.m. of each day (Saturdays, Sundays and public holidays excepted), the days and hours during which it is open and accessible to the public; and

(g) a statutory declaration, in the prescribed form, made by the agent of the company, and the Registrar shall register the company under this Division by registration of the documents.”

Section 355 (1) defines “carrying on business” as including “managing or otherwise dealing with property situated in the country as an agent, personal representative or trustee, whether by servants or agents or otherwise.”

Section 355 (2) however provides:

“(2) Notwithstanding Subsection (1), a foreign company shall not be regarded as carrying on business within Papua New Guinea for the reason only that, within Papua New Guinea, it:

(a) is or becomes a party to an action or suit or an administrative or arbitration proceeding, or effects settlement of an action, suit or proceeding or of a claim or dispute; or

(b) holds meetings of its directors or shareholders or carries on other activities concerning its internal affairs; or

(c) maintains a bank account; or

(d) effects a sale through an independent contractor; or

(e) solicits or procures an order that becomes a binding contract only if the order is accepted outside Papua New Guinea; or

(f) creates evidence of a debt or creates a charge on property; or

(g) secures or collects any of its debts or enforces its rights in regard to any securities relating to any such debts; or

(h) conducts an isolated transaction that is completed within a period of 31 days, not being one of a number of similar transactions repeated from time to time; or

(i) invests any of its funds or holds any property.”

The requirement is S. 358 is one of many requirements which a foreign company must comply with. Upon registration, the Registrar issues a Certificate of Registration: S. 358 (9). Failure to comply with any of these requirements is a criminal offence punishable by a specific fine or where no fine is expressly provided, a fine of K20.00: S. 367.

A body corporate registered and incorporated in PNG acquires corporate status - it can sue and be sued in the country of it’s registration and incorporation, it can hold property in it’s corporate name, etc. A body corporate registered and incorporated in another country receives corporate status in that country and this corporate status is recognized in PNG only if it is registered in PNG under Part XII, Division 3. It’s corporate status in it’s own country of incorporation and registration alone is not sufficient to give it all the attributes of a corporate entity in PNG unless it is expressly provided for by statute. That is done through a system of registration under Part XII, Division 3. Section 37, for example, enables a company registered in PNG to hold land in PNG.

PNG is part of democratic nations of the world with a free market economy. As such, it appears to me that the intention of the Companies Act is to provide for a system of incorporation and registration of Companies to enable them to participate in modern commerce. The primary focus of the Act is targeted at persons or companies who are based in PNG and who are desirous of carrying on business in PNG as a corporate entity. The provisions in Part XII, Division 3 permits foreign companies to carry on business in PNG provided they comply with the requirements of Part XII, Division 3 for no foreign company has any right to carry on business in PNG as do persons or corporate entities registered and incorporated in PNG. Unless they are registered under Part VII, Division 3 and comply with other requirements of Part XII, Division 3, their activities may be considered contrary to law or illegal.

The plaintiffs plead in their statement of claim that since 1988, they have “continuously carried on the business of providing security services throughout PNG” by reference to the name “Brinks.” (para. 8 and 9 of statement of claim).

In my view, in failing to register the plaintiffs under Part XII, Division 3 of the Companies Act at any time since 1988, both plaintiffs committed various criminal offences under the Companies Act for which they stood to be prosecuted in a court of law.

The plaintiffs submit that they were not carrying on business within PNG and that therefore, pursuant to S. 356, Division 3 of Part XII does not apply to them and they cannot be in breach of it’s requirement.

Section 356 provides that Division 3 of Part XII:

“applies to a foreign company only if it has a place of business or is carrying on business, within Papua New Guinea.”

They also rely on the saving provisions of S. 355 (2).

They submit that their activities are saved under S. 355 (2)(a), (d), (e), (f) and (g) because:

“Their business involves coming to PNG to try and get orders which are accepted in Australia and for the portions of their contracts within PNG they always effect those sales through an independent contractor and they invoice the client and collect the debts.”

In my view, this argument is not open to the plaintiffs because the very basis of their action as pleaded in paragraph 8 and 9 of the statement of claim is that they have continuously carried on business of providing security services throughout PNG since 1988. And “carrying on business” as pleaded ought to mean it’s statutory definition as per S. 355 (2) of the Companies Act. Further, the plaintiffs in particular the Second Plaintiff has commenced business in PNG directly by entering into agreements with PNG based companies and the part-performance of those contracts are handled by their PNG “Sub-Contractor” namely, PNG Armoured. They are simply not involved in obtaining orders and effecting sales through an “independent contractor.”

The other important legislation is the IPA Act 1992 which replaces the former National Investment and Development Act Ch. No. 120. The purpose of this Act is to “provide for the promotion of investment in the interest of national, social and economic development.” (see preamble of the Act). Section 1 defines the purposes of the Act to be:

“(a) to promote and facilitate investment in the country by citizens and foreign investors; and

(b) to provide for the grant of a certificate to a foreign enterprise; and

(c) to define the activities open to a foreign investor; and

(d) to provide for a register of foreign investment opportunities; and

(e) to promote investments which will materially benefit the country and it’s people and which:

(i) contribute to economic growth; or

(ii) create employment; or

(iii) utilize domestic resources and in particular, renewable resources; or

(iv) assist in skills acquisition; or

(v) increase the volume and value of exports; or

(vi) develop remote areas of the country; or

(vii) facilitate increased ownership of investment by citizens; or

(viii) promote import replacement; or

(ix) are likely to effect any combination of the aims specified in Subparagraphs (i) to (viii); and

(e) to monitor the impact of investment and the activities of enterprises;

(f) to establish the Investment Promotion Authority to assist the State in achieving the purposes specified in this Section.”

The Act provides for a system of, inter alia, certification of a foreign enterprise or company (“foreign enterprise” includes a corporation: See S. 1) to carry on business in PNG in specified areas not reserved for PNG. The phrase “carrying on business” is widely defined in S. 1 to include “administering, renting, managing or otherwise dealing with property as an owner, agent, legal personal representative or trustee whether by a servant or agent or otherwise,” or maintaining an agent, employee or officer for the purpose of Soliciting or procuring or entering into order, arrangement, agreement or contracts (whether conditional or not) whether or not the agent, employ a officer who is continuously resident in the country,” or “marking an office, or agency or branch (however described) whether or not the office, agency or branch is wholly used for one of those purposes by another enterprise.” A foreign enterprise shall or must not carry on business in PNG unless a certificate has been granted under Part IV: S. 25 (2). A certified foreign enterprise shall or must comply with any law applying to it and such compliance is deemed to be a condition precedent to every certificate: S. 25 (4). A certificate under the Act does not relieve the foreign enterprise from compliance with any other law: e.g. Part XII, Division 3 of the Companies Act. A foreign enterprise or an officer or owner which carries on business without a certificate under the Act; or carries on business in an activity reserved for a citizen or a national enterprise is guilty of a criminal offence punishable by a fine not exceeding K100: S. 41. A contract, agreement or understanding entered into between a foreign enterprise and another enterprise and the foreign enterprise which is not certified at the time the contract was entered into may be declared unlawful and void by the court on application by another enterprise or the Investment Promotion Authority: S. 41 A. A foreign enterprise which fails to comply with any other provision of the Act is guilty of an offence and is liable to punishment of a fine not exceeding K25,000.00 or imprisonment of a term not exceeding two (2) years or both: S. 41 B.

The IPA Act contains the clearest statement of the purposes of the Act pertinent to public policy consideration prevailing in PNG today - that foreign enterprises or companies, irrespective of their international standing or business reputation have no right, as citizens have, to carry on business in PNG. If they wish to do so, then they must comply with the requirements of this Act and the Companies Act or any other relevant Act. Their international reputation or standing in PNG in a free market economy must start with compliance with this country’s laws as to registration and incorporation or certification. If they fail to do so, they will not be seen with favour by the Court when it comes to the exercise of the Court’s equitable discretion.

It is clear from the pleadings that the plaintiffs were “carrying on business” continually in PNG since 1988 (statement of claim, para. 8 & 9). That being what they say, I accept their statement on it’s face value. I take their assertion of “carrying on business” as having the same meaning as the statutory definition of “carrying on business” as per S. 355 of the Companies Act and S. 1 of the IPA Act.

It is clear that they were carrying on business in PNG in breach of the Companies Act and the IPA Act. In other words, they were carrying on business illegally in PNG. The issue whether the particular business dealings, etc, were unlawful and void is not before me and I am not in a position to decide the issue. However, I am clear in my mind that they were carrying on business in PNG, without registering their foreign companies under Part XII, Division 3 of the Companies Act and without obtaining certification under the IPA Act. They were committing criminal offences in doing so.

The action of passing-off is maintained in the equity courts in England. They have now sought an equitable remedy of an injunction against the defendants. But they have not complied with this country’s statutory laws. The defendants on the other hand complied with all the statutory laws of this country as a national company as to incorporation under the Companies Act, and registration under the Business Names Act. They are not in breach of any statutory law. They are entitled by statutory law to carry on business in PNG under their corporate name and style and under their registered business names. If the plaintiffs are suggesting that Mr. Lucas acted improperly in using the special knowledge of the plaintiff’s business whilst he was with PNG Armoured, to set up his own business, then I know of no principle of law which forbids him from doing so after he has left the company. Even if his conduct were improper, the illegality of the plaintiff’s business in PNG far outweighs Mr Lucas’ purported improper conduct.

There are other statutes the defendants rely on such as the Business Names Act, Trade Marks Act and Taxation Act to show that the plaintiffs were conducting business in PNG illegally. However, it is not necessary to go into those legislation. For our purposes, it is sufficient that the plaintiffs were carrying on business in PNG in breach of the Companies Act and the IPA Act.

In my view, the court could not possibly grant the equitable relief sought in these circumstances. I would dismiss the plaintiff’s action on these basis alone.

In arriving at this conclusion, I am aware of provisions in the IPA Act and the Companies Act which say that the contracts or dealings of foreign companies are not invalid merely because they have failed to comply with the requirements of the Companies Act and IPA Act as to registration or certification respectively. However, these proceedings do not involve challenges to the validity of the transactions between the plaintiffs and their PNG resident agents or customers and therefore they do not arise for consideration. I am only concerned with the legality of their presence in PNG.

If I were to be wrong in dismissing the plaintiffs’ action on the foregoing basis, I need to consider whether each of the plaintiffs have proven their claim of passing-off. I will consider each element of passing-off separately.

4. THE EVIDENCE

(a) Summary of Plaintiffs’ Evidence

The plaintiff produced oral and documentary evidence. The oral evidence consists of eleven (11) witnesses. These witnesses had also filed affidavits and they were tendered in Court subject to objections and cross examination by the defence. They are:

1. Timothy Blackwell - Director and Company Secretary of the Second Plaintiff based in Sydney, Australia. (Affidavit sworn 30/9/94 (Exhibit “PP”))

2. Herbert Brenner - Regional Marketing Director of the Second Plaintiff based in Sydney. Three (3) affidavits sworn on 30/9/94 (Exhibit “A”); 6/10/94 (Exhibit “B”) and 7/11/95 (Exhibit “C”).

3. Will Jamaeson - General Manager, PNG Armoured based in Port Moresby. (Affidavit sworn 2/11/95 (Exhibit “CCC”).

4. Dicklaus Zandee - Managing Director of Placer Niugini Ltd based in Port Moresby. (Affidavit sworn 3/11/95 (Exhibit “LL”).

5. Robert Mark Pemberton - Operations Manager of Metal Regaining Operation (“MRO”) based in Port Moresby (Affidavit sworn 1/11/95 (Exhibit “FF”).

6. Ian Beresford Brooks - Manager (Security Development and Training), Air Niugini based at Jacksons Airport, Port Moresby. (Affidavit sworn on 2/11/95 (Exhibit“KK”).

7. Trevor Partic Lourensz - Manager of Coca-Cola Amtil (PNG) Pty Ltd based in Port Moresby. (Affidavit sworn on 31/10/95 (Exhibit “GG”).

8. Brian Philip Bartholomaeus - Manger Administration and Finance) CRA Minerals (PNG) Pty Ltd based in Port Moresby. (Exhibit “BBB”).

9. Alexander Frank Cusin - Managing Director of Mobil Oil New Guinea Ltd based in Port Moresby. (Affidavit sworn on 31/10/95(Exhibit “FF”).

10. James Jeffrey Schulz - Administrator (Human Resources). Chevron Niugini Ltd based in Port Moresby. (Affidavit sworn 3/11/95 (Exhibit “NN”).

11. Marere Tova - Search Clerk, Gadens Ridgeway Lawyers, Port Moresby. (Affidavit sworn 3/11/95 (Exhibit “OO”).

Also through these witnesses, the plaintiff tendered documentary evidence.

The plaintiff’s case is as follows. The evidence of the plaintiff’s corporate structure and their activities throughout the world including Australia and PNG was given by Mr. Blackwell and Mr. Brenner. Their evidence combined is as follows. The First Plaintiff is a company first incorporated in around 1859 in the United States of America (USA). It’s Headquarters is based in Thorndal Circle, Darien, Connecticut, USA. It conducts it’s business under the name “Brinks” and “Brink’s.” The core of it’s business is in armoured trucks and security transportation services. It has subsidiary companies using the name “Brinks” and “Brink’s” throughout USA and in about forty four (44) countries which are spread throughout Africa, Asia/Pacific Rim, The Carribean, Europe, Middle East/Asia Minor, North America and South America/Central Americas. Australia and PNG come under the Asia/Pacific Rim. There are some sixty (60) companies which comprise of and are defined as the Brinks Incorporated Group of Companies out of which fifty three (53) companies include the name “BRINKS” or “BRINK’S” in their corporate or business title. There are some 8,000 armoured trucks and over 32,000 personnel employed by Brinks world-wide. It is the oldest and largest security transportation company in the world. Having traded in excess of 130 years, the First Plaintiff has acquired a reputation in the international business and financial market place for providing a valuable and reputable service in a wide range of security service businesses. A major component of the plaintiff’s business reputation is founded on:

(a) the expertise acquired by the plaintiffs over the said period;

(b) the corporate and financial back-up throughout the worldwhich is provided to the plaintiffs by Brinks Incorporated Group of Companies;

(c) the insurance coverage which the plaintiffs have throughout the world; and

(d) the reputation for security and excellence of delivery of services which the plaintiffs have acquired by way of their history of performance of security services throughout the world (Blackwell’s affidavit, Exhibit “PP” p. 26).

The evidence on the set up of the First Plaintiff and it’s subsidiary or partner Companies throughout the world is not clear. There is no evidence from the First Plaintiff directly, such as from the Managing Director or Company Secretary, of how it sets up business in other countries. Some evidence nevertheless was given by Mr. Blackwell. Mr. Blackwell, is a Director and Company Secretary of the Second Plaintiff (hereinafter abbreviated PL/2). He is also a director of several Companies in the Asia/Pacific Rim region. He is a director of Brinks - BKS Ltd based in Singapore, Brink’s Japan Ltd based in Japan, Brink’s Security Transport Singapore Pte Ltd based in Singapore, Brink’s Taiwan Ltd based in Taiwan Brink’s Ayra (India) Pty Ltd based in India and Brink’s Pakistan (Put) Ltd based in Pakistan. As such he is the Senior Executive Manager of the Asia-Pacific region of Brinks Inc. Group of Companies world-wide. He reports regularly directly to Mr. Michael Thomas Dan who is the President and Chief Executive Officer of the First Plaintiff. He travels to Connecticut at least once a year to see Mr Dan. The Piston Company owns 100% of the shares in the First Plaintiff. The First Plaintiff owns certain shares in Brinks Companies throughout the world. The Directors of the First Plaintiff also hold directorship positions in these other companies. e.g. Mr Dan is a director of the Second Plaintiff.

It appears from Mr. Blackwell’s evidence that for the First Plaintiff to conduct business in another country, it may get a resident agent in that country to form a propriety company. An easier way of doing this appears to be the purchase of a shelf-company which later converts it’s name to a company using the name Brinks or Brink’s. The names of most of the companies of the Brinks Inc. Group of Companies listed world-wide in an international company listings (Exhibit “TB1” of Mr. Blackwell’s affidavit (Exhibit “PP”) shows that they are companies incorporated under the relevant company laws of that country. Sharelodging in these companies appears to vary but the First Plaintiff and it’s partners appears to hold the entire shares or a major portion of the shares. Depending on the shareholding, they’re entitled to hold directorship position, subject of course to the Articles and Memorandum of Association. The First Plaintiff may hold shares directly or indirectly through it’s holding companies.

In the case of the Second Plaintiff it was first incorporated in New South Wales, Australia on 28th September 1989. It was initially purchased as a shelf company known as Rinkala Pty Ltd. It later changed it’s name to the Second Plaintiff. It’s current directors are Mr. Blackwell (who is also it’s company secretary), Jeffrey Hendrickson of Connecticut, USA (who is the Senior Vice President of the First Plaintiff) and Michael Thomas Dan of Connecticut, USA. It’s first director from 9/12/88 - 15/7/94 were James Buniham of Connecticut, USA, Reginald Harold Ball of NSW, Australia and Gray Garton of Connecticut, USA. It’s current shareholder is Brinks Security International Inc. of Connecticut, USA. Ultimate holding company is Piston Company Inc. of USA.

The First Plaintiff conducts business in Australia through the Second Plaintiff.

Prior to the incorporation of the Second Plaintiff in Australia (28/9/89), the First Plaintiff conducted business in PNG through PNG Armoured since 1988. There is an agreement between the First Plaintiff and PNG Armoured executed on 28/4/89 for the provision of security services in respect of transportation of valuables by PNG Armoured for the First Plaintiff: Brenner’s affidavit of 7/11/95 Annexure H61. There is no mention of the Second Plaintiff in that agreement. However, there is very little evidence of correspondences between the two parties showing actual performance of the contract directly between the First Plaintiff and PNG Armoured. The only available evidence of correspondences between the two parties are as follows:

(i) Letter from First Plaintiff to PNG Armoured dated 28/4/89 regarding waiver of insurance in excess of amount covered by the Warsaw Convention and PNG Armoured not to place in excess of K25 million. on any one conveyance.

(ii) Various invoices issued by the First Plaintiff to the Commonwealth Bank of Australia and National Australia Bank for deliveries of currencies between 10/1/89 - 27/6/89, in particular to PNGBC, Port Moresby; Niugini Lyods Bank, Lae; Bank of South Pacific, Port Moresby and Westpac Bank, Port Moresby. Payments were directed to be made to Brinks Australia Pty Ltd but queries regarding the invoice were to be sent to either Brinks Australia Pty Ltd or in some cases the Second Plaintiff. The invoices bear the First Plaintiffs address where correspondences are to be addressed to.

Upon incorporation of the Second Plaintiff on 28 September 1989, all business of the First Plaintiff in PNG were conducted on their behalf by their 100% owned subsidiary, the Second Plaintiff. One piece of evidence here is a covering letter dated 30th May 1989 from “Brinks Australia Pty Ltd” with Brinks Australia trade mark and also bearing address of the First Plaintiff which was sent to PNG Armoured enclosing copies of letters from the Second Plaintiff to PNG Armoured of 28/4/89 and copy of contract dated 28/4/89. But no mention is made of the Second Plaintiff in that letter.

Neither plaintiffs have any office or registered office PNG. They are not incorporated in PNG. They have not registered “Brinks” as a business name in PNG. They have also not registered their “Brinks” trade mark in PNG.

The Second Plaintiff conducts business in PNG as follows. In Mr. Brenner’s affidavit of 7/11/95, para. 6, (Annexure HB3), he has annexed a bundle of agreements he says were entered into between Second Plaintiff and it’s customers. They are:

1. Agreement between Bank of America and Brinks Air Courier Pty Ltd dated 31/1/90.

2. Agreement between Placer (PNG) Pty Ltd and Brinks Australia Pty Ltd dated 27/8/90.

3. Agreement between Misima Mines Pty Ltd and Brinks Air Courier Pty Ltd dated 15/12/93.

4. Agreement between Supplementary agreement between Misima Mines Pty Ltd and Brinks Air Courier Pty Ltd dated 15/12/94.

5. Agreement between Pogera Joint Venture and Brinks Air Courier Pty Ltd dated 1/5/94.

6. Agreement between Metal Refining Operations Pty Ltd and Brinks Air Courier Pty Ltd dated 21/11/94.

The Second Plaintiff also has business contacts with various other companies in PNG such as Quantas Airways, Air Express International, Air Niugini, PNG-BC, Securimax and Guard Trans. Annexure HB4 of Brenner’s affidavit of 7/11/95 contains contact reports of Second Plaintiff and customers in PNG including PNG Armoured.

PNG Armoured is a sub-contractor of the Second Plaintiff. The Second Plaintiff has no written agreement with PNG Armoured. All physical ground handling work in PNG is done by PNG Armoured. Invoices for work done by Second Plaintiff are rendered from Sydney, in Australia Dollars. The Second Plaintiff pays PNG Armoured for their services at agreed rates. Annexure “D” of Brenner’s affidavit of 7/11/95 contains samples of invoices.

The operating procedure of PNG Armoured and the Second Plaintiff is as follows: For movement of valuables out of PNG, the Second Plaintiff contacts PNG Armoured advising of shipments from various customers in PNG coming to Port Moresby. PNG Armoured picks them up and ensures that they are placed on an aircraft destined for overseas. In the case of unrefined gold ore, PNG Armoured collects them from the Jackson’s Airport and takes them to the MRO base at Waigani for refining. The refined gold is then picked up from MRO and delivered to Jackson’s Airport to be shipped out of PNG. For shipments of currencies coming into PNG, the Second Plaintiff contacts PNG Armoured about expected shipments. PNG Armoured collects them from Jackson’s Airport and delivers them to their destination.

The Second Plaintiff uses two types of bags in PNG. There is a big hessiac bag marked with just the letter “B” in blue and white print: Court Exhibit “DD”. The other one is a plastic bag which has Brinks Australia trade mark on it with the name Brinks printed in blue.

There are 3 letterheads used by the Second Plaintiff to conduct it’s business in PNG:

1. Letterhead containing the Second Plaintiff’s address on the top right hand corner with Brinks Australia trade mark e.g. Court Exhibit “E” (Pl.).

2. Letterhead containing the same trade mark used by the Second Plaintiff appears on the top right hand side but beside it appears the First Plaintiff’s address. On the top left hand corner appears the name “Brinks Australia” and it’s trade mark. This is used by “Brink’s Australia” of “BRINK’S INTERNATIONAL”, e.g. Annexure HB2 of Brenner’s affidavit of 7/11/95.

3. Letterhead containing the same trade mark used by the Second Plaintiff but with the First Plaintiff’s address appearing on the top right hand corner and on the top left hand corner, appears the same trade mark used by BRINKS AUSTRALIA but without the word Australia. This appears to be used by the First Plaintiff: e.g. see Annexure HB2 of Brenner’s affidavit.

It is to be noted that the same trade mark used by the First Plaintiff appears on the plastic bag used in Papua New Guinea. The trade mark used by the First Plaintiff and Second Plaintiff besides their addresses appears to be imprinted on the hessian bag. All these trade marks are registered throughout the world where Brinks Inc. Group of Companies carries on business except PNG.

The Second Plaintiff’s customers in PNG know or have known and are aware of the Second Plaintiff as “Brinks” or “Brink’s” since 1988. Mr. Brenner was appointed to his position in November 1992. His predecessor is Mr. Michael Hallan. Mr. Brenner made various trips to PNG and he’s sure his predecessor did too. He had used the name Brinks in his conversations, dealings and correspondences, with their customers, etc in PNG. Regular contact is made between various employers of their customers. Those customers know the name Brinks. Business in PNG since 1988 was valued at $Aus. 2,020.70 in 1988. This was for work done for the Commonwealth Bank. It has now increased to business worth $Aus. 156, 394.97 in the year ending 1994.

The Second Plaintiff maintained regular contacts within PNG in the course of conducting it’s business between 1989 - 1995. PNG Armoured appears on it’s confidential list of business contacts. Also in the confidential list of business contacts, Mr. Lucas is listed as Managing Director (from 25/1/93 - 19/4/94) and Mark Soi as manager (from 25/5/95) of PNG Armoured.

Whilst with PNG Armoured, Mr Lucas was personally involved in the handling of valuables for the Second Plaintiff. There are in evidence copies of numerous correspondences exchanged between the Second Plaintiff and PNG Armoured under Mr Lucas’s authorship. The letters issued by Mr Lucas and his predecessor Mr Kiatro Abisinito are not strictly confined to or addressed to the Second Plaintiff by it’s corporate name. Some are addressed to “Brinks Australia Pty Ltd” using the same postal address of the Second Plaintiff shown on the Second Plaintiff’s letterhead. Others are addressed to “Brinks Australia.” Those letters are regarded to or are understood by PNG Armoured and Mr Lucas to be meant for the Second Plaintiff and are responded to by the Second Plaintiff: See Brenner’s Affidavit of 7/11/95, Annexure “HB2”.

Until 6/5/94, Mr Lucas was the Managing Director of PNG Armoured. Unknown to the Second Plaintiff, he had resigned from his job. On 25/5/94, Mr Lucas had a meeting with Mr Brenner at the Islander Hotel at Waigani where by Mr Lucas advised Mr. Brenner that he had started a company under the name Brinks Pty Ltd, Brinks Armoured and Brinks Security Services with the financial backing of an Asian businessman. He was going to compete with and provide better services than PNG Armoured and asked for a quote from him. He said PNG Armoured was in bad debts and not profitable. Mr Brenner objected to the use of the name Brinks and told Mr Lucas he had to obtain permission from the plaintiffs to do that. Mr. Lucas and his Asian counterpart, the Third Defendant, went on to set up the First Defendant company’s operations. He introduced insignia bearing signs with the name Brinks printed on it. He advertised for business in the business community in Port Moresby. This came to the knowledge of the Second Plaintiff. As a result, the Second Plaintiff complained of damages to it’s reputation in PNG and confusion in the market place.

The plaintiff has produced a copy of a letter written by Mr Lucas under letterhead of Brinks Security Service offering his company’s services to the manager of Proclean Pty Ltd of Port Moresby. He says the services offered in the letter are similar to those provided by the Second Plaintiff of which Mr Lucas is aware of because of his employment with PNG Armoured: See Court Exhibit “JJ”.

The plaintiffs have called various other witnesses to prove that there has been confusion in the market place in PNG among their customers and the general business community and damaged it’s reputation.

Mr Jamaeson is the general manager of PNG Armoured. His company provides sub-contracting work for a number of years for the Second Plaintiff whom who he calls “Brinks Australia.” The security services of valuables is confidential. He has known “Brinks” as an America company of international standing and a leader in the world for providing armoured car security transport. In 1994, he became aware of the Port Moresby Brinks (the Defendants) providing armoured vehicles with the name “Brinks Armoured” written in large black letters. If he had not learned that the Port Moresby Brinks was different from Brinks America or Brinks Australia, he would have thought that they were associated. There is a strong possibility that confusion will arise whereby cargo intended for the Second Plaintiff maybe collected by the Port Moresby Brinks. As long as the defendants are allowed to use the name “Brinks”, there is potential for confusion in the market place even with the best of their efforts to prevent the confusion from occurring.

Mr Zandee says Placer (PNG) Ltd is a customer of the Second Plaintiff. He says he has worked with the Placer Company in North America, and South East Asia since 1969 and now with Placer (PNG) Ltd since 1993. He is familiar with the name “Brinks” in North America and Asia and other parts of the world as providing high quality security services including high quality armoured car services. He has seen “Brinks Armoured” vehicles in Port Moresby. He thought they were part of Brinks America or Brinks Australia. Now, having been explained the difference, he knows the difference. Brinks Australia has provided security services to Placer (PNG) Ltd over several years. Such services are vital to Placer’s Operations. It is essential that there must not be a confusion or mistake in the security operations with the use of the name Brinks because it would risk the safety of valuable cargo. He sees a potential for confusion as long as the Port Moresby Brinks continue to use that name. If the difference had not been explained to him, if he obtained services from the Port Moresby Brinks, he would have thought that he was obtaining the services of Brinks America or Brinks Australia. If the difference was not explained to him, he would have thought that Brinks America or Brinks Australia were inefficient when he saw a Post Courier newspaper report on 28/3/95 of a Brinks Armoured vehicle being held up in Port Moresby. If Placer suffered any loss or damage or a result of confusion in the market place, this would damage Brink’s Australia’s reputation.

Mr Pemberton of MRO says MRO is a customer of the Second Plaintiff. He is aware of the name Brinks Australia and it’s services throughout Australia and in PNG through MRO’s business directly and through PNG Armoured. Now with the Port Moresby Brinks, it is confusing because it is providing services similar to those provided by the Second Plaintiff. There is a possibility that a mistake could be made by staff of either MRO or PNG Armoured or Air Niugini where despite his supervision, gold and bullion movements from MRO’s premises in Port Moresby, intended for the Second Plaintiff to be collected by PNG Armoured could be collected by Port Moresby Brinks. This could severely damage the existing relationships between MRO and Brinks Australia.

Mr Brooks has been the manager of Security Development and Training for Air Niugini at Jackson’s Airport in Port Moresby since 1988. He has worked in the security service industry in Australia and PNG since 1969. He is familiar with the name “Brinks” as being associated with Brinks America and Brinks Brambles of Australia. He has known it to be associated with the provision of armoured car security services whilst he was working in Australia.

He has had regular contacts with PNG Armoured over the services provides by the Second Plaintiff. He has had contacts with Mr. Lucas on matters relating to the Second Plaintiff. Due to the sensitivity of security services, he is concerned about disclosure of information.

He learned of Port Moresby Brinks in early 1994. He thought Port Moresby Brinks had set up a business in association with Brinks Australia or America. But later he found out that it wasn’t. The Port Moresby Brinks management contacted Air Niugini Management Staff in early 1995. They were told that PNG Armoured has had it’s insurance withdrawn and were about to close business. Those were later found to be false.

At one stage, a person rang him from Gerehu, Port Moresby, saying he was the Managing Director of Brinks, Port Moresby. He asked that person if he was from the real Brinks Australia or from Brinks Gerehu. He said he was from Brinks Gerehu. He refused to deal with him and instructed Air Niugini Staff not to confuse Port Moresby Brinks with Brinks Australia.

He foresees a possibility that Brinks Australia cargo not collected by PNG Armoured may be collected by Port Moresby Brinks. That would be damaging. It would lead to litigation against Air Niugini.

A company name like “Air Niugini” is vital to it’s business success and reputation. Had he not been aware of the difference between the two Brinks, he would have assumed that the Port Moresby Brinks had the backing of Brinks America or Brinks Australia.

Mr Lourensz of Coca Cola Amtil (PNG) Ltd says his company is not a customer of the Second Plaintiff. But he is aware of the name “Brinks” which is prevalent in the security business and in American movies. He associates the name “Brinks” with a United States Security Company of international reputation that primarily provides armoured car transport services. He has seen PNG Armoured cars using the name Brinks in Port Moresby. He has also received a business proposal from the Port Moresby Brinks. When he received the proposal he was under the impression that they were of the America Brinks but later found out it wasn’t. He’s aware of the importance of and the value of a trade name to a company and considers it part of a company’s and goodwill as is the case with “Coca Cola.”

Mr Barthomaens is the manager of Administration and Finance with CRA Minerals (PNG) Pty Ltd since 1992. His company is not a customer of the Second Plaintiff but a potential customer. He is familiar with the name Brinks and associates it with as USA security company of international reputation. When he saw armoured cars operated by the Port Moresby Brinks, he thought they were connected with the “International Brinks”. But now he knows their difference.

Mr Cusin of Mobil Oil (New Guinea) Ltd says his company is not a customer of the Second Plaintiff. But having worked in Australia before coming up to PNG in 1988, he was familiar with the name Brinks in Australia from his work with Mobil and generally having seen video clips of Brinks Australia and Brinks America. On 20/1/95, he saw a Post Courier newspaper report entitled “Dye to save the goodies” showing an Australia designed security device being demonstrated by “Australia and PNG Security distributor Brinks Security.” Upon seeing the article, he assumed the Brinks referred to in the article as being associated with Brinks America or Brinks Australia. But later, he found out it wasn’t. On 28/3/95, he saw another Post Courier report showing an armed hold up of a Port Moresby Brinks Security vault in Port Moresby where a gang robbed the Brinks Security personnel of K5,000.00 and escaped. He thought Brinks America or Australia was involved. He knew that Brinks America or Australia provided high quality security services and if his company had obtained Port Moresby Brinks Services without knowing their difference, he would have expected their services to be of the same standard. He knows that his company now uses the services of Port Moresby Brinks. The decision to engage Port Moresby Brinks by his company was made at mid-management level. Like the name Mobil, he considers the name Brinks to be essential to a company’s reputation and business.

Mr Shultz of Cherron Niugini Ltd has been with that Company since 1990. Prior to this, he worked in USA and other countries for 15 years. He knows the name “Brinks” very well. He associates the name with an American Company which offers high quality security guards and armoured car services of an international standard. When he saw the Port Moresby Brinks, he related it to the American Brinks or Brinks Australia. Had he not known their difference which he now knows, he would have thought the Port Moresby Brinks had the backing of Brinks America or Brinks Australia.

The evidence of Marere Tova relates to discoveries made in the process of a company search conducted at the office of the Registrar of Companies in Port Moresby on 22/9/95. Her findings are:

1. On 24/1/95, “Brinks Armoured Cars” was registered as a business name under provisions of the Business Names Act Ch. No. 145. The business name is owned by the First Defendant. It’s place of business is Lots. 13 & 14, Sec. 357, Hohola, PO Box 280, Gerehu. The type of business is listed as “Transport of cash valuables.”

2. On 24/1/95, “Brinks Security Services” was also registered as a business name. Other details are the same as (1) above except the type of business is listed as “Security Services.”

3. On 13/9/93, “Brinks Pty Ltd” (formerly Patu No. 5 Pty Ltd) was incorporated. On 2/5/94, Patu No. 5 Pty Ltd changed it’s name to the First Defendant. The directors are Mr. Lucas and Gary Tan. The shareholders are Sien Yap Tan (51 shares) and Herman Lucas (49.)

This is a summary of the evidence for the plaintiff.

(b) Summary of Defence Evidence

The evidence for the defence was given by Mr Barry James Tan, Ms Silyvia Tsukula and Mr Lucas who was the principal witness. The evidence of Mr Tan is that he is a businessman (Asian) with substantial business interest in PNG. He was approached by Mr Lucas in 1994 for financial assistance to help him set up a security company known as Brinks Armoured and Brinks Security Services. Mr Lucas selected the name “Brinks”. This name meant nothing to Mr Tan. He was not really concerned with the business name. He had never heard of the name in PNG Brinks before or in Australia where he had visited occasionally. He holds 51% of the shares in the First Defendant. through his uncle Danny Tan whilst Mr Lucas hold 49% shares. He knew Mr Lucas as a Managing Director of PNG Armoured which was involved in the security service industry and knew the business Mr Lucas proposed was to be in competition with PNG Armoured.

Slyvia Tsukula is a Search Clerk with AC & Fox Associates (Search and Service Agents) of Port Moresby. She was called to give evidence on a telephone survey or poll she conducted among various business people in PNG as to their familiarity with the name “Brinks”. Her evidence was sought to be tendered by the defence as expert evidence. The plaintiffs objected to such evidence. I upheld the plaintiff’s objection and ruled that her evidence was inadmissible because she was not a qualified and competent expert witness. She had been merely employed as a Search Clerk and this survey was her first ever poll conducted in her career.

The evidence of Mr. Lucas is as follows. He was born of Dutch parents (Holland) in Australia. His parents came to PNG in 1966 from Australia. His father went on to become a citizen of PNG. Mr Lucas has continually lived in PNG and travelled to Holland. The first time he went to Holland was when he was 13 years old where he went to spend his holiday with his grandfather. That is where he heard the name “Brinks” which in Holland refers to a grassy area with trees in the centre of the town around the main church. As a teenager, he had also seen a movie called the “Brinks Job” which involved the robbery of an armoured car in either America or Italy and assumed the name to be a fictitious company.

On 1st April 1991, he commenced employment with PNG Armoured initially as a Branch Manager and later became it’s Managing Director. As Managing Director, he was responsible for running the business. PNG Armoured was involved in providing security services in Port Moresby including armoured cars and armed escorts.

PNG Armoured did work for the Second Plaintiff. The system of work was that for shipments of valuables coming to PNG, the Second Plaintiff advised by fax of a shipment of currency being flown in. A copy of the airway bill was also faxed. PNG Armoured arranged for customs clearance of the airways bill. When the plane arrived, PNG Armoured attended at Jackson’s Airport, Port Moresby in an armoured car, loaded the shipment into an armoured car and took it to it’s nominated bank. The operation was carried out with maximum secrecy. For valuables being shipped out of PNG, in particular bullion gold, the Second Plaintiff informed PNG Armoured of the shipment arriving from the Second Plaintiff’s customers around PNG. PNG Armoured then attended at Jackson’s Airport and loaded the bullion gold onto it’s armoured vehicle and loaded it on to flights leaving PNG. For unrefined gold ore, PNG Armoured would take the gold ore to MRO, Port Moresby and when it was refined, pick it up and take it to Jackson’s Airport and load it on the flight. In his job, Mr. Lucas had regular contacts with the management of the Second Plaintiff including Mr. Brenner.

In 1992, whilst Mr Lucas was employed by PNG Armoured, he held discussions with Mr. Reg Ball of the Second Plaintiff to set up a company to provide services similar to PNG Armoured. He was unsuccessful in convincing the Second Plaintiff. Subsequent discussions followed between Mr Lucas and Mr. Brenner in 1993 regarding the quality of services provided by PNG Armoured to the Second Plaintiff’s customers in PNG as well as new business such as transportation of gold ore from the Pogera Gold Mine. But nothing material eventuated from these discussions.

Whilst he was with PNG Armoured, all the work that PNG Armoured did for the Second Plaintiff was the transfer of currency and travellers cheques from Jackson’s Airport to PNG-BC, and Bank of South Pacific, Port Moresby and the reverse, transfer of gold dore for Pogera Gold Mine from Jackson’s Airport to MRO, Port Moresby, and transfer of refined gold from MRO to Jackson’s Airport to be shipped out of PNG. PNG Armoured never picked up gold dore from the Misima Mine.

PNG Armoured did not do any work for the First Plaintiff and in fact, never heard of it when he was there.

Mr Lucas left his job with PNG Armoured in April 1994 after holding discussions with Mr Tan. He set up his own security service company with the financial backing of Mr Barry Tan. He decided to use the name “Brinks”. He conducted a search at the Companies Office in Port Moresby and ascertained that the name “Brinks” was not a registered business name and that there was no company with a corporate name having the name “Brinks” in PNG. So he decided to use the name Brinks. He arranged for incorporation of the First Defendant Company and registration of “Brinks Armoured” and “Brinks Security Services” as business names. He decided on a shield with the name Brinks on it and gave it PNG flavour by including the PNG flag colours with red bird of paradise. He printed logos, badges, uniforms, letterheads, etc. He purchased an armoured car locally and imported another one. He had them printed with the name “Brinks Armoured.” At the time of the trial, the First Defendant employed 36 nationals, had 4 armoured cars, 4 other cars and in excess of 50 clients. When he was doing all these things the plaintiffs were aware of it and did not complain.

Sometimes in 1994 he held discussions with Mr Brenner to get some business from him. Mr Brenner sounded favourable to his business proposal.

His business claimed no connection with the plaintiffs. His business does not conflict with the business of the Second Plaintiff. Brinks is unknown to the public in PNG. In his 30 years PNG, he knows that the PNG public do not know of the name Brinks.

He never saw the Brinks plastic and hessian bags in evidence when he was with PNG Armoured.

There is no confusion in the security service business in PNG. He did not use the plaintiffs’ name when advertising for business. He did not represent his business to be that of the plaintiffs. No one has told him that in considering his company for business, they were relying on the Plaintiff’s name and reputation and expected his service to be of international standard.

His company has been trading in Port Moresby for 18 months and it is well known in Port Moresby. It is a local company. His customers deal with him because they know him and his reputation or are dissatisfied with their present customers. They do not deal with him because of the name “Brinks” or because of any association his company has with the plaintiffs.

That is a summary of the defence evidence.

5.0 FINDINGS OF FACT AND CONCLUSIONS

5.1 First Plaintiff’s claim

5.1.1 Reputation or goodwill

The First Plaintiff’s claim is that the First Plaintiff has a reputation or goodwill in PNG, having carried on business in PNG and it’s services are associated with the name “Brinks”. It says “Brinks” is not descriptive of the services it provides but the name “Brinks” is known for or associated with it’s high quality security service in transportation of valuables worldwide. It carried on business in PNG continually since 1988 and is known by that name by the PNG business community. To prove this, the First Plaintiff refers to the Agreement between it and PNG Armoured dated 28/4/89 and various invoices issued by the First Plaintiff to the Commonwealth Bank of Australia between 10/1/89 - 27/6/89.

The plaintiffs submits that they carried on sufficient business in PNG to have a reputation or goodwill which is capable of being protected by a passing-off action.

The defendants submit the First Plaintiff did not carry on business on it’s own in PNG and therefore had no reputation or goodwill.

The First Plaintiff relies on it’s reputation or goodwill attached to the name “Brinks”. The issue is whether the First Plaintiff carried on business activities in PNG sufficient to establish a goodwill or reputation in PNG which was attached to the name “Brinks” as distinctive of high quality security service in the transportation of valuables using armoured cars.

It is clear to me from the authorities that a passing-off action is not simply about protection of business names, the trade mark or get-up alone. It is about reputation or goodwill “attached to a name which is distinctive of a product (or service) or class of products” (or service) sold by him in the course of his business. And so in this case, if the name “Brink”, or “Brinks”, Brink’s” is attached to high quality security services generally and armoured car security services provided by the First Plaintiff world-wide and extending to PNG, then the plaintiff can maintain an action based on the use of that name.

On the evidence before me, I find that the name “Brinks” or “Brink’s” is a name associated with the First Plaintiff and the “Brinks Inc. Group of Companies” world-wide including the Second Defendant and used by the First Plaintiff to distinguish it’s high quality security service world-wide. There is overwhelming evidence produced by the plaintiff to demonstrate this fact. But I find that the name “Brink” is not used by the First Plaintiff.

There is evidence adduced by the defendants to show that some companies in Australia have been registered with the name “Brink” and have no association whatever with the plaintiffs and the plaintiffs took no action to stop them from using that name e.g. Brink & Co. Pty Ltd, Brink Holdings Pty Ltd, Ad, Brink Holdings Pty Ltd, Brink Mining Pty Ltd, Brink Nominees Pty Ltd, Brink Project Management PNG Ltd, Ban Brink Elade & Co. Pty Ltd and Van Den Brink Pty Ltd. (Court Exhibit “AAA”). Some of these companies have been registered as late as 02 - 27th June 1995. However, I am not referred to any company with the name “Brinks” or “Brink’s” in Australia or any other country, which has no connection whatsoever with the Plaintiffs. Be that as it may, I have already found that the name “Brink” is not used by the Plaintiffs. Therefore, the use of the name “Brink” in Australia is of no consequence.

I also find that the name “Brinks” or “Brink’s” is associated with the provision of high quality security services using armoured cars and involved in the transportation of valuables such as currency, gold etc. in the international business community.

The only question is whether the First Plaintiffs carried on sufficient business in PNG to establish a reputation or goodwill in PNG capable of protection by a passing-off action. In other words is there evidence of “user” in this country of the First Plaintiff’s service sufficient to establish a reputation or goodwill to give title to First Plaintiff to maintain an action of passing-off?

In the pleadings, the First Plaintiff pleads that it has carried on business continually since 1988. The evidence is that, there is an agreement between First Plaintiff and PNG Armoured entered into on 28th April 1989. From the invoices in evidence issued by the First Plaintiff between 10/1/89 - 27/6/98, the First Plaintiff appears to have invoiced for services performed well before the date of the agreement. These invoices do not show how the First Plaintiff conducted such business in PNG. e.g. which sub-contractor they used in PNG. The invoices issued after the agreement do not reveal the total circumstances in which the First Plaintiff performed those services in PNG - whether they were done using a PNG - based sub-contractor such as PNG Armoured.

There is very little evidence of business transactions and correspondences directly between the First Plaintiff and PNG Armoured. Also the evidence of Mr. Blackwell is conflicting. He says initially in cross examination that the First Plaintiff issued invoices for commercial activities in PNG in 1988 and 1989. But there is no invoices for work done in 1988. He then says after 1989, all business was carried out by the Second Plaintiff. He later said the First Plaintiff has not issued invoices for business since 1989. The invoices however show that the First Plaintiff was issuing invoices for work done in 1989.

All in all, the only evidence of some presence of the First Plaintiff in PNG is the agreement dated 28 April 1989. That alone is not sufficient. It is merely an agreement to do business in PNG. On the evidence, I find that the First Plaintiff, did not carry on sufficient business in PNG sufficient to establish a reputation or goodwill on it’s own in PNG.

5.1.2 Misrepresentation

On the evidence, I am unable to conclude that the defendants misrepresented to the public in PNG that the services they were providing were that of the First Plaintiff because little was known of the First Plaintiff in the business community in PNG. All the plaintiffs’ witness who gave evidence as customers or potential customers or members of the business community in PNG gave evidence of knowing the First Plaintiff as an American company. They’ve had no experience in dealing with the First Plaintiff. For those witnesses representing existing customers of the Second Plaintiff, they have not said if their companies chose to do business with the Second Plaintiff because of the reputation of the First Plaintiff and it’s group of companies throughout the world. These witnesses only complain about the potential for misrepresentation by the defendants. There is no evidence of the defendants actually having misrepresented to the public in PNG that the services they were providing were that of the First Plaintiff or that they were part of or associated in any way with the First Plaintiff.

On the contrary, the evidence from the defendants is that they have identified themselves as a local company using the name Brinks and that they are not in any way associated with the First Plaintiff. And the defendants having registered their business name and incorporated their company under that name in accordance with the laws of this country are entitled to conduct business in this manner.

It is true that the defendants have chosen to use the name “Brinks” which is also used by the Plaintiffs but mere use of another’s business name, mark or get up is not sufficient in law. The plaintiffs must prove that the defendants were putting off their services as those of the plaintiffs. The plaintiff has failed to prove that in this case.

5.1.3 Damages

As for damages, there is no evidence that the First Plaintiff on it’s own has suffered any damages or is likely to suffer any damages as a result of any misrepresentation. The evidence is at the most speculative. Furthermore, they have no business of their own in PNG which stands to suffer from the use of the name Brinks. The First Plaintiff is an independent legal corporate entity and there must be some evidence of actual or likely damage. The Second Plaintiff is a separate legal corporate entity. The damages the Second Plaintiff suffers or might suffer is not necessarily that of the First Plaintiff. The loss of existing or potential customers in PNG of the Second Plaintiff is different from the loss of dividend income due to the First Plaintiff through it’s shareholding in the Second Plaintiff.

For these reasons, I dismiss the First Plaintiff’s claim.

5.2 Second Plaintiff’s claim

5.2.1 Reputation or goodwill

The defendants concede that the Second Plaintiff has a business reputation or goodwill in PNG. Therefore, I find that the Second Plaintiff carried on business in PNG since 1989 of sufficient magnitude to establish a reputation or goodwill as evidenced by in the use of the name “Brinks” in PNG. Indeed, the Second Plaintiff was known in PNG among it’s customers and potential customers with whom it had business contacts by the name “Brinks” and more commonly known as “Brinks Australia”, even though it did not have any office in PNG. It’s customers including it’s sub-contractor, PNG Armoured, knew the Second Plaintiff by several names - Brinks Australia, Brinks Australia Pty Ltd and Brinks Air Courier Pty Ltd. Mr. Lucas in his term as Managing Director of PNG Armoured also came to know the Second Plaintiff by these names. The common element in all these name was the name “Brinks”. I find that the Second Plaintiffs customersor potential customers knew Brinks Australia to be a company associated with the wider international security services industry under the name “Brinks” in the transportation of valuables between Australia and PNG. They relied on the Second Plaintiff services to transport valuable cargo in the form of currencies and gold. PNG Armoured being their resident sub-contractor or agent was also known to be a reliable agent associated with the Second Plaintiff.

5.2.2 Misrepresentation

The Second Plaintiff submits that the evidence provided for the plaintiffs support the conclusion that the defendants had misrepresented their services as the services of the Second Plaintiff and they only discovered the falsity after it was explained to them the difference between the Port Moresby Brinks and the international “Brinks”. The defendants submit that in using the name Brinks, they are not misrepresenting the First Defendant’s business as the business of the Second Plaintiff or claiming any association with it.

On the evidence, there is no or insufficient evidence that the defendants misrepresented to the PNG public that the services they were providing were of the plaintiffs or in any way associated with the plaintiffs. The defendants registered their company and business name under the prevailing law of this country and felt, and rightly so, that they were entitled to use the name “Brinks”. They in no way held themselves out as being associated with the international Brinks of which the Second Plaintiff was a part of. None of the customers felt cheated. In fact the evidence is that they all came to know the Port Moresby Brinks was in no way associated with the Second Plaintiff. It was on the strength of their own registered corporate name and style and business name that the defendants went about advertising for business. In the advertisement, they claimed no association with the Second Plaintiff.

It is true that Mr Lucas had prior and special knowledge of the source of the name “Brinks” as being associated with the Plaintiffs whilst working for PNG Armoured. I do not accept Mr Lucas’s evidence that he heard of the name “Brinks” during his holiday in Holland in his teenage days. But the mere adoption of the name is of no consequence because it has not been shown that the defendants actually misrepresented to the PNG public that they were providing security services provided by the plaintiff through their resident agent, PNG Armoured. If there is any representation to the PNG public that they were in direct competition with the Australian or American Brinks in the same service industry, then such misrepresentation is permissible in the free market economy.

There is little or no dispute that some of the services the defendants are providing are similar to the services provided by the Second Plaintiff through it’s resident agent, PNG Armoured. Customers or potential customers of the Second Plaintiff in PNG would know or associate Mr Lucas with these kind of services because of his former employment with PNG Armoured as it’s senior management staff. Mr. Lucas would no doubt have developed a reputation for providing quality services of the kind for his employer, PNG Armoured. With this special knowledge and experience and standing, he has left PNG Armoured to start his own business using the business knowledge, skills and experience gained whilst with PNG Armoured. The name “Brinks” has no doubt been acquired by him whilst he was with PNG Armoured. But is he wrong in doing so? I do not think so. Has he misrepresented the public into thinking that the services his company is providing is that of the Second Plaintiff when it is actually not? That I do not think so. There is no evidence he has. He is entitled in a free market economy to engage in fair competition. He could provide exactly the same service as those provided by the Second Plaintiff in PNG through it’s resident agent, PNG Armoured. He would only be held liable if he misrepresented to the public that his services are those of the Second Plaintiff or in any way associated with the Second Plaintiff when it is actually not.

The evidence too is that Mr Lucas’ business is involved in a wide range of security services businesses and the transportation of currency and gold, some of which services are provided by PNG Armoured on behalf of the Second Plaintiff. But the evidence is that, that is only a small portion of his business. All these services have been advertised to potential customers in PNG. The services provided by him which are similar to those provided by Second Plaintiff through PNG Armoured have not been singled out and given special attention so as to misrepresent it to his potential customers.

5.2.3 Damages

The plaintiffs must show that they have suffered damages or likely to suffer damages. Proof of damages or likely damage is the essence of the claim of passing-off. The evidence is that the defendants commenced business on or about 24th or 22nd May 1994, (date of change of name for Patu No. (5) Pty Ltd to Brinks Pty Ltd). The writ in these proceedings was filed on 10th October 1994. The trial commenced on 6th November 1995 and concluded on 22nd November 1995. Therefore, as at the date of trial, it was some 18 months the defendant was in business using that name.

This is not purely a case where the defendant’s have just only started. They have been in business for 18 months before the trial and it was only appropriate that the Second Plaintiff provided some evidence of actual confusion in the market place or loss of existing or potential customers resulting in actual damage.

Although there is some evidence of likelihood of confusion among the plaintiff’s customers in PNG, there is no evidence that there has actually been some confusion. There is very little or no evidence that valuable cargo intended for PNG Armoured on behalf of the Second Plaintiff was mistakenly picked up by the Defendants. There is no evidence to show that the Second Plaintiff’s customers had switched from the Second Plaintiff and moved over to the defendants because of the defendants’ use of name “Brinks”. Any argument that potential customers in PNG will engage in business with the defendant instead of the Second Plaintiff because of the defendant’s use of the name “Brinks” is highly speculative. Indeed, the Second Plaintiff provides highly specialised services in selected areas which attract special customers in PNG and those customers or potential customers would know, through the normal course of business contacts with the Second Plaintiff, that the defendants are not associated with them and they will not deal with the Second Defendant’s if they chose not to. A good example of this is the experience encountered by Air Niugini staff. Therefore, any future damage is not reasonably foreseeable.

6. BOTH PLAINTIFFS COMBINED

To the extent that the First Plaintiff rely on the activities of the Second Plaintiff in PNG, accepting that the First Plaintiff acquired reputation or goodwill in PNG through the activities of the Second Plaintiff, I would still dismiss their claims on the grounds that both plaintiffs have not proven misrepresentation and damage.

For these reasons, I dismiss the plaintiff’s action with costs to the defendants.

Lawyer for the Plaintiffs: Gadens Ridgeway

Lawyer for the Defendants: Allens Arthur Robinson