This week the High Court returns
from its winter sojourn to hear argument in four cases. Perhaps appropriately, the court will wake
from its hibernation with a dispute over coffee.
Today the Court will hear argument in Cantarella Bros Pty Limited v Modena Trading Pty Limited, which raises important issues relating to the use of foreign
descriptive words as trade marks in Australia. Cantarella produces coffee in Australia from imported beans.
It promotes and sells its coffees using various registered trade marks including “Vittoria”, “Oro” and “Cinque
Stelle”. Cantarella widely promoted its
Oro branded coffee through supermarkets, and its Cinque Stelle coffee was
served in many restaurants and by Qantas. Modena imports and markets coffee
supplied by an Italian company, Caffè Molinari SpA (“Molinari”).
Molinari’s coffees include blends named “Oro” and “Cinque Stelle”, which
are sold in Italy and are exported to many countries. Many other
producers and importers of coffee also use the word “Oro” in their brands in
Australia. In Italian, “Oro” means gold, and “Cinque Stelle”
means five stars. Cantarella sued Modena for infringement of its
registered trade marks. Modena cross-claimed, seeking the cancellation of
each trade mark’s registration. At first
instance Justice Emmett declared that Modena
had infringed Cantarella’s trade marks. His Honour held that the words
“Oro” and “Cinque Stelle” were sufficiently distinctive because only a small
minority of people in Australia would understand the meaning of the words, and
thus the allusions to quality made by them.
The Full Court of the Federal Court
unanimously allowed Modena’s appeal. Their Honours held that instead of
focusing on the knowledge of the general population, the focus ought to have
been on the knowledge of traders in coffee. Italian was so commonly used
in relation to coffee in Australia that traders other than Cantarella would
readily understand, and indeed had long used, the words “Oro” and “Cinque
Stelle” to signify quality of goods. The Full Court then ordered that the
registration of the trade marks of those words be cancelled.
On Wednesday, 6 August 2014 the Court will hear
argument in Maxwell v Highway Hauliers Pty Ltd, which raises an important issue in relation to the proper construction of s 54 of the Insurance Contracts Act 1984
(Cth). Hauliers carried on a trucking business and operated a fleet of
trucks and trailers that transported freight between the Eastern and Western
states of Australia. Hauliers had a contract of insurance with various
Underwriters at Lloyds in London (represented in Australia by Maxwell) that
covered accidental loss or damage to all vehicles owned, leased or acquired by it. The contract of insurance also included a
provision which stated that no indemnity was provided under the policy unless
all drivers met certain conditions, including obtaining a People and Quality
Services test score of at least 36. In separate accidents in 2004 and 2005
trucks owned by Hauliers were damaged. Claims under the insurance policy were
rejected on the basis that the relevant drivers had not obtained the relevant
PAQS test score. It was accepted by
Maxwell that the failure of the drivers to complete a PAQS test had not caused
or contributed to the accidents. Hauliers sued Maxwell for indemnity, and also
claimed damages for breach of the contract of insurance for the loss of profits
for not being able to use the damaged trucks.
At first instance and in the Western Australia Court of Appeal, it was
held that Maxwell was obliged to indemnify the Insured by reason of
s 54(1) of the Act, which relevantly provides that where the effect of the
policy would be that the insurer may refuse to pay a claim (in whole or in
part) by reason of some act of the insured or of some other person, being an
act that occurred after the policy was entered into, the insurer may not refuse
to pay the claim by reason only of that act, but its liability is reduced by
the amount that fairly represents the prejudice to the insurer's interests. In
doing so they rejected the contention by Maxwell, relying upon a 2010 decision
of the Queensland Court of Appeal, that the failure to undertake the PAQS test
was not an omission to which section 54(1) applied, but was simply a state of
affairs which had the effect that there was no cover provided by the policy at
all.
On Thursday, 7 August 2014 the Court will hear
argument in related appeals in Kentwell v The Queen and O’Grady v The Queen. These cases raise an important procedural
issue in relation to appeals in the criminal jurisdiction in NSW. In each case the appellants commenced an
appeal against sentence in the NSW Court of Criminal Appeal, but required an
extension of time within which to bring that appeal. The same panel of judges heard each of the
applications, and in each case it was found that the sentencing judge had erred
by making a so-called Muldrock error
(named after the High Court decision that held that a standard non-parole
period was not the starting point from which sentencing courts depart by applying
aggravating or mitigating factors, but was simply one of the factors in
determining the appropriate sentence).
Nonetheless, in each case the Court of Criminal Appeal held that the
error had not resulted in any substantial injustice and therefore refused the
extension of time within which to appeal.
The appellants’ complaint is two-fold: firstly, the CCA should not have
imposed a “no substantial injustice” test to the exercise of the discretion to
extend time, and secondly that in doing so they effectively determined the
merits of the appeal in a “summary fashion”.
On Friday, 8 August 2014 the Court will hear argument
in Alphapharm Pty Ltd v H Lundbeck A/S. This case involves a challenge to a decision
by the Commissioner of Patents (upheld by the AAT and the Full Federal Court)
to extend the time within which Lundbeck could make an application to extend
the term of the Patent held for an anti-depressant drug marketed by Lundbeck in
various forms under the names Cipramil and Lexapro. At its heart is an argument about the proper
construction of the Patents Act and
the regulations made thereunder. But it
has profound commercial significance for Lundbeck and its competitors (who had
already placed generic versions of the drugs on the market prior to the
extension) as well as for the public health budget.
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