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American Cyanamid Company v. Vitality Pharmaceuticals Ltd.

Supreme Court of Nigeria

Judgement delivered on Friday, February 8, 1991
Citation: 34 NIPJD [SC. 1991] 12/1989
Suit No. SC. 12/1989      Jurisdiction: Nigeria

BEFORE THEIR LORDSHIPS

MOHAMMED BELLO, J.S.C
ADOLPHUS GODWIN KABIRI-WHITE, J.S.C.
SAIDU KAWU, J.S.C
SALIHU MODIBBO ALFA BELGORE, J.S.C.
OLAJIDE OLATAWURA, J.S.C. (Delivering the Lead Judgement)

Appearances: G.N. Uwechue (with him, U. E. Egbe) for the Appellant
Respondent unrepresented

Trademark Infringement, Priority of Registration as against Continuous Use — The main issue considered by the Supreme Court in this case was whether the continuous use of the unregistered trademark “GONORCIN” by the Defendant/Respondent for antibiotics, prior to the Plaintiff/Appellant’s registration of their trademark in 1973 entitled the Defendant/Respondent to dismiss the Plaintiff/Appellant’s claim for the infringement of their registered trademark “GONOCIN” also for antibiotics.

I. FACTS

On June 19, 1973, the Plaintiff/Appellant — American Cyanamid Company Limited, registered the trademark “GONOCIN” No. 27409 in respect of antibiotic preparations.  The Defendant/Respondent –Vitality Pharmaceuticals Ltd, asserted that since 1968, they had sold antibiotic preparation by putting them in white cardbroad boxes with green designs and printings bearing the word “GONORCIN” in bold green letters and other words in smaller forms and that in 1978, they caused the word to be registered with the Pharmacy Board in Lagos. The Defendant/Respondent contended at the trial that the Plaintiff/Appellant’s trademark registered in 1978 was not entitled to be so registered and that the registration sued upon was invalid on the ground that the trademark interferes with the use of the name “GONORCIN” which the Defendant/Respondent had been using and distributing continuously in Nigeria since 1968, a date prior to the plaintiffs registration or use.

At the trial court, Ayinde, J. dismissed the claims on May 21, 1985.  The plaintiff was dissatisfied with the judgment and appealed to the Court of Appeal which in turn confirmed the judgment of Ayinde, J. on July 17, 1988.  Still dissatisfied with the decision of the lower Court, the plaintiff appealed to the Supreme Court with the leave of the court.

II. FULL CASE FACTS

O. OLATAWURA, J.S.C. (Delivering the Lead Judgment) The competing claims of the parties in this appeal relate to the registration of a trademark about one antibiotic registered by the Appellant under the trademark of GONOCIN as against the Respondent which had its own registered as GONORCIN. Prima facie quite apart from the claim of infringement of the trade mark one is likely to be misled that it is also a passing off action. But their claim and counter-claim leave no one in doubt that priority of registration and continuous use claimed by the Respondent played a dominant role in their claims.

There were originally two Plaintiffs which filed the action in the Federal High Court of the Lagos Judicial Division against two Defendants. After amendment of the Statement of Claim, the claims read as follows:

  1.  An injunction restraining the Defendants their servants and agents from infringing the Plaintiffs registered Trade Mark “GONOCIN”;
  2. Delivery up on oath for destruction of all goods, cartons, packages, capsules, wrappers, blocks, discs or stamps bearing any mark or get up that would be in breach of the injunction prayed for.
  3. An account of the profits by the Defendants by reason of their having carried out the said acts of infringements or damages of N500,000.00.
  4. Costs.
  5. Further or other relief.

In their Amended Statement of claim, the Plaintiffs averred as follows:

1. The Plaintiffs are the Registered proprietors of Trademark “GONOCIN” No. 27409 Schedule 4 in respect of the following goods including antibiotic preparations.

2. The aforesaid trademark is valid and still on the Register of Trademarks. At the trial, Plaintiffs will rely on a Certified True Copy of the Extract from the Register marked ‘For use in Legal Proceedings” issued by the Registrar of Trademarks to the Plaintiffs in respect of the aforesaid trademark.

 2(a) The 1st Plaintiff is a corporation organised and existing under the Laws of the State of Maire (sic) U.S.A. having its executive offices at Wayne, New Jersey 07470. At the trial of this Suit, the Plaintiffs will rely on the Certificate of the Wayne Chamber of Commerce and other documents in proof of the legal status of the 1st Plaintiff.
2(b). The 2nd plaintiff is a Limited Liability Company incorporated in Nigeria under the Companies Act, 1968. At the trial of this action, the Plaintiffs will found on the Certified True Copy of the 2nd Plaintiff’s Certificate of Incorporation.

3. The 1st Plaintiff are manufacturers and the 2nd plaintiff are vendors of antibiotic capsule which they have for several years imported into and sold in Nigeria under the said Trade Mark “GONOCIN.”

4. The aforesaid capsules sold as and under the said Trade Mark “GONOCIN” is widely known and used in Nigeria.

5. The Defendants are vendors of pharmaceutical drugs and preparations.

6. The Defendants have recently put on the market and offered for sale and have sold Capsules under and/or using in connection therewith the trademark “GONORCIN.” Plaintiffs will found on invoices and receipts issued by the Defendants for such sales.

7. The aforesaid trademark “GONORCIN” used by the Defendants is similar to the plaintiffs’ aforementioned trade mark “GONOCIN.”

8. By reason of similarity the public is likely to and have been led to confuse and take the Ganorcin Capsules of the Defendants’ manufacture and/or sale.

9. The Defendant filed an Amended Statement of Defence and counterclaim.

The Defendant averred as follows:
1. The Defendant makes no admission as to paragraphs 1 and 4 of the Statement of Claim.

2. The Defendant denies paragraphs 2, 3, 6, 7 and 8 of the Statement of Claim.

3. The Defendant which was first registered on 21st October, 1956 as Vitality Medicine Stores was incorporated as a limited liability pharmaceutical company on the 6th May, 1980. Hitherto it was registered under the Registration of Business Names Act on the 22nd February, 1968 as Vitality Medicine Store – Pharmaceutical.

4. The defendant has since 3rd of December, 1963 been the sole agent of one Herbrand K.G. Hornonforsonung-Laboratarium, Gengenbach/Baden, West Germany (hereinafter referred to as Herbrand Company) a pharmaceutical company based in West Germany which manufactures inter aliaantibiotic preparation.

5. Since 1968, the Vitality Medicine Stores as Agent, has put upon the market and sold antibiotic preparation manufactured by Herbrand Company by putting them in white cardboard boxes with green designs and printings thereon, such printing bearing the word “GONORCIN” in bold green letters and other words in smaller forms. The word GONORCIN is a mark which the defendant has acting in good faith built up a reputation in.

6. In 1978, the defendant caused the antibiotic preparation “GONORCIN” to be registered with the Pharmacy Board in Lagos.

7. The defendant will contend at the trial that the plaintiff’s Registered Trade Mark 27409 registered in 1978 was not entitled to be so registered and that the Registration 27409 sued upon is invalid on the ground that the trade mark interferes with the use of the name “GONORCIN” which the defendant had been using and distributing continuously in Nigeria since 1968, a date prior to the plaintiffs registration or use.

8. With reference to paragraph 7 of the Statement of Claim, the defendant denies that the use of its said label or otherwise had infringed the plaintiffs alleged trade mark No. 27409.

9. The defendant’s use of the said label in connection with the antibiotic capsule is not calculated to confuse or lead and has not in fact led to any deception or to the belief by the public that “GONORCIN” capsules of the defendant are the antibiotic capsules of the plaintiff sold under the label GONOCIN 030.

10. The defendant will contend at the trial that the word GONORCIN, used by the defendant is a bona fide description of the character or type of antibiotic preparation.

11. The defendant will further contend at the trial that the plaintiffs are not competent to institute this action.

12. The defendant will at the trial rely on the following document (sic) in proof of its case.
(a) Receipt books issued by the defendant in respect of drugs including GONORCIN since 1969 – i.e.
(i) Issue 801 – 900
(ii) Issue of Foreign Goods; 5601, 2600
(iii) Issue invoice 1-100
(iv) Issues 1631, 1659, 1653, 1655, 1659, 1667, 1675, 1683, 1695, 3610, 3613, 3614, 3615.
(b) Proforma Invoices issued between 1968 to 1973 in respect of drugs including GONORCIN particularly proforma dated 5th and 30th July, 1968 by Herbrand Company.
(c) Sales books where sales of drugs including GONORCIN were recorded since 1968.
(d) Letter dated 30th July, 1968 to the defendant by Dr. Herbrand K.G.

WHEREOF the defendants, contends (sic) that the plaintiffs’ claim is misconceived and frivolous and should be dismissed.

COUNTER-CLAIM
AND by way of counter-claim the defendant repeats paragraphs 1-12of the Statement of Defence and counter-claim for-
(1) An Order that the entry in the Register of Trade Marks in respect of Trade Mark GONOCIN’ No. 27409 be deleted;
(2) Further or other relief;
(3) Costs.”
Evidence was called by both parties. It was on 19th June, 1973 that the 1st plaintiff registered GONOCIN as a trade mark with Registration Number 2740. A certified true copy of the registration was admitted in evidence as Exhibit A. It is not necessary to go into the controversy whether the 1st plaintiff could have maintained an action in this country bearing in mind it was a foreign company. That issue was resolved in the court of trial and was not an issue in the lower court nor has it been raised in this court. I will come to the issues before us shortly.

The first plaintiff manufactured the Drug which was marketed by the 2nd plaintiff as GONOCIN. The plaintiffs later found in the Nigerian Market a similar product under the trade mark of GONORCIN and was marketed by the defendant. The sample of GONORCIN was admitted in evidence as Exhibit D while the sample of GONORCIN, so to say the offending product, was admitted in evidence as Exhibit E. It was also the case of the plaintiffs that the 2nd plaintiff was incorporated under the Companies Act. 1968 on 2nd December, 1980. But before the incorporation of 2nd plaintiff, the GONOCIN has been introduced to the Nigerian Market by J.L. Morison and Company and it was after the incorporation of the 2nd defendant company that it took over the marketing of the drug from J. L. Morison and Company, Exhibit D is simply described as GONOCIN 030 and bore the label “GONOCIN 030”. The 1st plaintiff witness was however unable to say whether GONORCIN registered by the defendant is an antibiotic. He agreed that there is a difference in spelling between the two products. Another witness called Ayodele Oboise confirmed that he bought GONORCIN i.e. Exhibit E from a Chemist. The last witness for the plaintiff was one George Eze who identified Exhibit D and E as having been bought from the plaintiff and defendants respectively.

In their own defence Chief Nkadi Chiwete the Chairman and Managing Director of the defendant company gave evidence that the defendant company was formerly registered under the business name of Vitality Medicine Store before it was incorporated as a limited liability company in May, 1980. It was incorporated and registered as VITALITY PHARMACEUTICALS LTD.  Before the incorporation they were the representatives of Dr. Herbrand K. G. Company the manufacturers of other drugs and antibiotics. The H defendants were the sale agents of GONORCIN i.e Exhibit E a product of Dr. Herbrand K. G. and they have been dealing with this drug – Gonorcin since 1968. Certain proforma invoices and letter dated 16th May, 1973were admitted in evidence as Exhibits G-G3 and J respectively. Agreement between the defendants and the German Company was also admitted as Exhibit K. The witness did not agree that Exhibits D and E were similar. The first time he saw Gonocin 030 in the market was 1978 whereas the defendants started marketing Gonorcin in 1968. Receipts for the sale of Gonorcin since 1969 were admitted in evidence as Exhibits L-L3. He also gave evidence about the counter-claim.

Under cross-examination, he said he registered as the Proprietor of Vitality Medicine Stores in 1956 before it was incorporated in May, 1980. The only witness called by the defendant was one Patrick Onwudinjo who was a staff of the defendant company between 1971-1980. He identified Exhibit E as one of the products of the defendants when he was working with them. Exhibits D and E were not similar.

Learned Counsel addressed the court and after a review of the evidence and submissions of learned Counsel, Ayinde, J. dismissed the claims on 21st May, 1985. The plaintiff was dissatisfied with the judgment and appealed to the Court of Appeal which in turn confirmed the judgment of Ayinde, J. on 17th July, 1988. Still dissatisfied with the decision of the lower Court, the plaintiff appealed to this Court with the leave of the court on the following grounds:

(1) The Court of Appeal misdirected itself in law and on the facts by applying the case of Gbadamosi Tokunboh & Anor. v. J. T Chanrai & Co. Limited(1976) 2 F.R.C.R.55 to this case when the facts of this case are distinguishable from the facts of the former and thereby came to a wrong decision in this case.

PARTICULARS OF MISDIRECTION
(a) The respondents (defendants) pleaded in paragraphs 4 and 7 of their Amended Defence and counter-claim (page 33 R/A) that they were sole agents of the manufacturers of “Gonorcin” and had been using and distributing same continuously since 1968 whereas the evidence led in support (Exhibits G-G3. H.J.K. and L-L3) showed that it was one Vitality Medicine Stores that did so up to August, 1971.

(b) In Gbadamosi Tokunboh’s case, the defendant PLEADED and PROVED continuous use prior to the registration of the trade mark of the plaintiff in that case.

(2) The learned trial Judge and the Court of Appeal misdirected themselves in law by deciding that the respondents were protected by Section 7, Trademarks Act, 1965 when the evidence in the case was that the appellants registered their trademark on 19th June,1973 (Exhibit A) whereas the respondents only came into being in May, 1980.

(3) The Court of Appeal erred in law by considering and basing part of its decision in this case on the respondents alternative submission of lifting the veil of incorporation when there was neither a cross-appeal nor a Notice filed pursuant to Order 3 Rule 14(2), Court of Appeal Rules, 1981.

(4) The Court of Appeal erred in law by holding that the respondents predecessor in title made use of the offending trade mark contrary to the respondents pleading (paragraph 7, Defence, page 33 R/A) and the finding of the learned trial Judge (pages 54-77R/A) that it was the respondents themselves who made such use and when there was no cross-appeal in the case.

(5) The Court of Appeal erred in law by affirming the judgment of the trial Judge which treated D.W.1, the respondent Company and Vitality Medicine Stores as one and the same person and thereby came to a wrong decision in law (pages 73-75 R/A).

(6) The Court of Appeal misdirected itself in law and on the facts by holding as follows:

I will agree that in the interest of justice it is essential to recognise the continuity of a business enterprises when on reorganisation, a new company takes over from an old or unincorporated firm… In the case in hand Chief N. Chiwete was the proprietor of Vitality Medicine Stores and he is the Managing Director of Vitality Pharmaceuticals Limited I am satisfied that Chief Chiwete is the alter ego of these two enterprises and I agree that the new company Vitality Pharmaceuticals Nigeria Limited is the successor in title of Vitality Medicine Stores and that they are entitled to the protection afforded by section 7 of the Trade Marks Act, 1956 (sic 1965) in their use and marketing of ‘GONORCIN” and thereby came to a wrong decision in the case.

PARTICULARS OF MISDIRECTION
(a) There was no evidence of any re-organisation in the respondent company nor of a take over of Vitality Medicine Stores by the respondents.

(b) There is no admissible evidence that the respondents are the successors in title of Vitality Medicine Stores.

(7) Judgment is against the weight of evidence.

The plaintiff and defendant will now be referred to as Appellant and Respondent respectively.

The appellant filed the appellant’s brief on 10th February, 1989. The respondent though served neither filed a brief nor appeared at the hearing of this appeal on 13th November, 1990. The appellant raised three issues for determination. They are:

(a) The trial Judge having found in favour of the appellant, the infringement of its trade mark (pp.71-72 R/A), do the pleadings in this case and the evidence led in support thereof justify the extension of the protection of Section 7 of the Trade Marks Act, 1965 to the respondent?

(b) Did the respondent prove by admissible evidence, that it is the successor-in-title to VITALITY MEDICINE STORES?

(c) Was the Court of Appeal right in affirming the decision of the trial Court on the basis of facts which are in conflict with the latter Court’s findings of fact (WHEN THERE WAS NEITHER A CROSS-APPEAL NOR A RESPONDENT’S NOTICE BEFORE IT PURSUANT TO ORDER 3 RULE 14(2) ) Court of Appeal Rules 1981?”

In his oral submission Chief Uwechue after adopting his brief submitted that before the respondent could avail itself of section 7 of the Trade Marks Act, 1965, it must show that it is the proprietor of the trade mark being challenged by the appellant.  Learned counsel referred to the finding of the learned trial Judge that although the respondent did not register the trade mark of their product GONORCIN, there was evidence they had been selling the products as Agent of Herbrand Company since 1968.  Learned Counsel pointed out that the respondent, a limited liability company, was set up in 1980. Learned counsel then referred to paragraph 3 of the amended statement of defence and counter-claim and submitted that since the respondent company came into existence in 1980, it was not possible to credit them with the trade mark of the product since 1973. Learned Counsel then referred to the finding of the Court of Appeal to the effect that the predecessor of the respondent used the trade mark. Learned counsel then invoked Order 3 rule 14(2) of the Court of Appeal Rules 1981 and submitted that the respondent in that court did not contend in the lower court that the decision be affirmed on other grounds other than the one relied upon by the trial court.  He re-emphasised that the trade mark was registered by the appellant in 1973.  He has also contended that the facts in this appeal are distinguishable from the case of Gbadamosi Tokunbo & Anor. v. J. T. Chanrai & Ors. Ltd, and Anor. (1976) 2 F.R.C.R.55 relied upon by the lower courts. He finally urged that the appeal be dismissed.

It appears to me that the issue in this appeal, notwithstanding the issues for determination already set out above is a narrow one which the appellant in its brief appreciated. In paragraph 5 of the appellant’s brief the appellant stated:

“5. All through their pleadings, (paragraphs 3, 4, 7 and 12 of the Amended Statement of Defence and Counter-Claim) the respondents maintained that they were agents to a German Company Dr. Herbrand K.G. and that they the respondent had continuously used the unregistered trade mark “GONORCIN” prior to the appellants’ registration of their trademark in 1973 (pp.33-34 R/A) THE CASE WAS FOUGHT ON THIS BASIS”
(Capitals supplied by me).

If reduced to its simplest form, that was the case presented at the court of trial. The question now is whether there was ample evidence. It will however be in line with adversary system to look at the pleadings. If the facts were pleaded and the evidence led was not challenged, it will be too late to make an issue of that in this court. Paragraphs 3-5 of the Amended Statement of Defence and counter-claim because of their materiality should be repeated notwithstanding they have been set out earlier. They are as follows:-

“3. The defendant which was first registered on 21st October, 1956 as Vitality Medicine Stores was incorporated as a limited liability pharmaceutical company on the 6th May, 1980. Hitherto is (sic) was registered under the Registration of Business Names Act on the 22nd February, 1968 as Vitality Medicine Store – Pharmaceutical.

4. The defendant has since 3rd of December, 1963 been the sole agent of one Herbrand K.G. Hermonforsenung – Laboratarium, Gengenbach/Baden, West Germany (hereinafter referred to as  Herbrand Company) a pharmaceutical company based in West Germany which manufactures inter aliaantibiotic preparation.

5. Since 1968, the Vitality Medicine Stores as agent, has put upon the market and sold antibiotic preparation manufactured by Herbrand Company by putting them in white card-board boxes with green designs and printings thereon, such printing bearing the word “GONORCIN” in bold green letters and other words in smaller forms. The word GONORCIN is a mark which the defendant has acting in good faith built up a reputation in.”

In his evidence before the trial court D.W.1 the Chairman and Managing Director of the respondent Company said:

“I am the Chairman and Managing Director of the defendant Company. The defendant company was formerly registered under the business name, Vitality Medicine Stores before it was incorporated in May, 1980 under its present name. Before the defendants were incorporated, they were the representative of Dr. Herbrand K.G. of West Germany. Dr. Herbrand K.G. Company was a manufacturer of Pharmaceutical, drugs hormones and antibiotics. The defendants were sole agents of Gonorcin Exhibit E, the Product of Dr. Herbrand K.G. We have been dealing with that drug since 1968. This is a letter with a proforma from Dr. Herbrand K.G. to the defendant. Letter dated 30/7/68 with proforma is tendered without objection and marked Exhibit G-G3.”

The cross-examination of this witness was limited to the date of registration of Vitality Medicine Stores and its incorporation which the witness put as 1956 and 1980 respectively and the four receipt booklets of Exhibit E marked L-L3.  Not a single question was asked about the continuous use of Exhibit E.  Where the evidence of a witness has not been challenged, contradicted or shaken under cross examination and his evidence is not inadmissible in law, and the evidence led is in line with the facts pleaded, the evidence must be accepted as the correct version of what he says:

Vincent I. Bello v. Magnus A. Eweka (1981) 1 S.C. 101
Adejumo v. Ayantegbe (1989) 3 NWLR (Pt 110) 417
Niger Construction Ltd. v. Okugbeni (1987)4 NWLR (Pt. 67) 787.

In accepting this evidence of continuous use the learned trial Judge said:

“Although the defendants have not registered the Trademark of their product, “GONORCIN” there is evidence that they have been selling the product in Nigeria as Agent of Herbrand Company since 1968.”

Commenting further on the evidence of D.W.1 Chief Chiwete which was in line with paragraphs 4-6 of the Amended Statement of Defence, the learned Judge again said:

“It follows then that the defendants have been selling Herbrand Company’s product with the Trade Mark “Gonorcin” five years before the 1st plaintiff registered their trade mark “Gonoein” in 1973…On the question of continuous use of the trade mark “Gonorcin”  by the defendants, I am satisfied from the Invoice books Exhibits L-L3 that the defendants have had continuous use of their trade
mark since 1969)…Continuous use of the trade mark does not necessarily mean daily sale of the product.”

The learned Judge then invoked section 7 of the Trademarks Act, 1965 in support of his findings. In the Court of Appeal, Mohammed, J.C.A. in his lead judgment with which Ademola and Kutigi, JJ.C.A. concurred said:

“From the state of the pleadings and evidence the respondents have established before the learned trial Judge that before registration of “GONOCIN” by the appellants the predecessors in title of the respondents i.e. Vitality Medicine Stores had been dealing and marketing the antibiotic drug under the name of GONORCIN.”

These are concurrent findings of fact which the appellate court will not interfere with unless they are perverse:

Nwadike v. Ibekwe (1987) 4 N.W.L.R. (Pt. 67) 718
Ayanwale v. Atanda (1988) 1 N.W.L.R. (Pt. 68) 22
Magaji v. Cadbury Nigeria Ltd. (1985) 2 N.W.L.R.(Pt. 7) 393
Onwuka v. Ediala (1989) 1 N.W.L.R. (Pt. 96) 182.

It appears to me that the appellant has, so to say, chosen to ignore the fact of earlier dealing with GONORCIN by the respondent and was carried away with the date of incorporation of the 2nd defendant company as a limited liability company in 1980.  It naturally follows that this initial error or attitude led the appellant to forget the existence of Vitality Medicine Stores which had since 1968 marketed the product GONORCIN.  Consequently the learned trial Judge and the lower court were right in their application of Section 7 of the Trade Mark Act of 1965.  It is a legitimate defence.

Section 7 of the Trade Marks Act, 1965 provides:
“7. Nothing in this Act shall entitle the proprietor or a registered user of a registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date previous to-

(a) The use of the first-mentioned trade mark in relation to those goods by the proprietor or a predecessor-in-title of his; or
(b) The registration of the first-mentioned trade mark in respect of those goods in the name of the proprietor or a predecessor-in-title of his, whichever first occurred, or (where such use is proved) to object to that person being put on the register for that identical or nearly resembling trade mark in respect of those goods under section A
13(2) of this Act.”

Furthermore a close scrutiny of evidence of D.W.1, D.W.2 and D.W.3 shows positively that issue and marketing of GONORCIN had been in the open market before the Medicine Stores was incorporated in 1980, Exhibit supports this conclusion, I will agree with the lower courts the protection provided by section 7 of the Trade Marks Act, 1965 covers the respondent’s case.

The case of Gbadamosi Tokunbo and Another (supra) is not distinguishable in the sense that what was relied upon by that Court before section 7 of the Trade Mark Act, 1965 was invoked was the acceptance of the evidence of continuous user. Where there has been no evidence of abandonment of continuous use the Judge can rely on section 7 of the Act: Smith, Bartlett & Co, v, British Pure Oil, Grease and Carbide Co. Ltd. (1933) 51 R.P.C. 157.

The appellant has contended in its brief that the evidence relied upon by the lower court is inadmissible and relied on Emegokwue v, Okadigbo (1973) 4 S.C 113. In other words that the facts of earlier and continuous user were not pleaded. It appears to me that the learned counsel has taken a narrow if not a dim view ofthe facts pleaded in paragraphs 3, 4, 5, 6 and 7 of the Amended Statement of Defence coupled with the uncontroverted evidence of Chief Chiwete (D.W 1), The phrase “continuously used” is not defined in the Act. We are concerned with the ordinary meaning and the legal effect bearing in mind the competing claims of the parties. Grammatically, the word “continuous” means uninterrupted. It will be straining the word of the statute to say that “continuously used” connotes daily use. I agree with the learned trial Judge when he said “continuous use of the trade mark does not necessarily mean daily sale of the product.”  It is a fundamental or primary duty of the court to ascertain the natural meaning of the words used in a statute. The court must not speculate. The whole section 7 of the Act should be read as a whole, My answer to issue (a) is in the positive, With regard to issue (b) I had already referred to the evidence of D.W.1, the pleadings and the finding of the lower court. The appellant has contended that since the Certificate of Registration of the business name and Certificate of Incorporation of the limited liability company were not tendered, the evidence of D.W.1 should not be believed, The evidence of D.W.1 as repeatedly stated was not challenged, The purpose of pleading is to give the other side at the earliest opportunity, the case the other side is to meet. There was no element of surprise in the respondent’s pleading, Once the evidence led is consistent with the facts pleaded and these facts were neither challenged nor controverted, the learned Judge will be right in accepting the facts: Nwabuoku v. Ottih (1961) 2 SCNLR 232; (1961) 1 All N,LR, (Pt.3) 487/490. The incorporation of the company was not challenged, the appellant concentrated mainly on the date of incorporation to negate the defence of continuous user pleaded before incorporation. The same line of defence is repeated in the brief. I will also answer the questions posed in respect of the second issue in the positive.

The third issue is whether the Court of Appeal was right in affirming the decision of the trial court because of the conflicts in the findings of fact by the trial court and the findings of fact by the Court of Appeal; moreso when there was neither a cross- appeal nor a respondent’s notice before the Court of Appeal as provided under Order 3 rule 14(2) of the Court of Appeal Rules 1981. It appears to me an assumption on the part of the learned Counsel that there was a conflict in the findings of fact between the trial court and the court below. The conclusion of Mohammed, J.C.A. is not in conflict with the findings of the learned trial Judge. The learned Justice after quoting Farwell, J. in Re London Housing Society Limited’s, Trust Deeds (1940) Ch. 777 said:

“In the case in hand Chief N. Chiwete was the proprietor of Vitality Medicine Stores and he is the Managing Director of Vitality Pharmaceuticals Limited. There is no doubt that his enterprises were responsible for the distribution of the drug under the trade marks name “GONORCIN” and his company still does so. I am satisfied that Chief Chiwete is the alter ego of these two enterprises and I agree that the new company, Vitality Pharmaceuticals Nigeria Ltd. is the successor in title of Vitality Medicines Stores and that they are entitled to the protection afforded by section 7 of the Trade Marks Act, 1956 (sic) in their use and marketing of GONORCIN.”

It is my view that there is no such conflict because the trial Judge after referring to paragraphs 4, 5 and 6 of the Statement of Defence of the respondents which I have earlier reproduced above said:

“The averments in the paragraphs (i.e. 4-6) were also proved through the evidence of their first “witness, Chief Nkadi Chiwete. It follows then that the defendants have been selling Herb and Company’s product with trade mark “Gonorcin” five years before the 1st plaintiffs registered their trade mark Gonocin 1973″

If however there has been a conflict then Order 3 rule 14 (2) ought to have been invoked by the respondent. I repeat there is no conflict. In my view invocation of Order 3 rule 14 (2) postulates that the judgment is correct but the reasons for the judgments are based on wrong premise when there is enough evidence on record which can sustain the judgment on other grounds other than those relied upon by the trial court. The respondent’s notice postulates the correctness of the judgment notwithstanding the grounds of appeal by the appellant to set it aside: Lagos City Council v. Ajayi (1970) 1 All N.L.R.2911294; Alhaji Sunmonu & Ors. v. Gbadamosi Ashorota (1975) 1 N.M.L.R.16.

Since the respondent did not contend in the lower court that the grounds on which the trial court relied upon in arriving at its decision were ‘wrong or extraneous to the issue before it, there was no need to invoke Order 3 rule 14(2) of the Court of Appeal Rules. On the other hand it was the contention of the respondent in the lower court that the decision of the trial court should be upheld. There was no need for any respondent’s notice.

On the whole, I win dismiss the appeal and affirm the decision of the lower court. Since the respondent neither filed a brief nor appeared at the hearing of the appeal, there will be no order as to costs.

M. BELLO, C.J.N.: For the reasons stated in the lead judgment of my learned brother, Olatawura, J.S.C., I also dismiss the appeal, affirm the decision of the Court of Appeal and make no award as to costs to the respondent. I shall only add a few words on the issue relating to Order 3 rule 14(2) of the Court of Appeal Rules, 1981.

The trial court found from the evidence before it that the “Vitality Medicine Stores – Pharmaceutical” had been registered under the Registration of Business Names on 22nd February, 1968 and since 1968 the Stores had been marketing the antibiotic with the trade mark “GONORCIN.” On 6th May, 1980 the Stores was incorporated as a limited liability company, named Vitality Pharmaceuticals Ltd. Upon incorporation, the company continued to market the “GONORCIN.” On the other hand, the appellant registered its “GONOCIN” as a trade mark on 19th June, 1973 under the Trade Marks Act, 1965.

From the foregoing finding of facts, the trial court concluded as follows:

“It follows then that the defendants have been selling Herbrand Company’s product with the trade mark “gonorcin” five years before the 1st plaintiffs registered their trade mark “Gonocin” in 1973. Section 7of the Trade Marks Act, 1965 makes provision for protection of a trade mark which was in use before the same or similar trade mark was registered. The Section provides:

“7 Nothing in this Act shall entitle the proprietor or a registered user of a registered trade mark to interfere with or restrain the use by any person of trade mark identical with or nearly resembling it in relation to goods in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date previous to-
(a) the use of the first mentioned trade mark in relation to those goods by the proprietor of a predecessor in title of his, or
(b) the registration of first-mentioned trade mark in respect of those goods in the name of the proprietor or predecessor in title of his, whichever first occurred or (where such use is proved) to object to that person being put on the register for that identical or nearly resembling trade mark in respect of those goods under section 13(2) of this Act.”

Accordingly, the trial court held that the respondent was entitled to the protection afforded by section 7 of the Act and that the claim for injunction restraining the respondent, its servants and agents from infringing the appellant’s registered trade mark failed.

In affirming the decision of the trial court on the issue, Uthman Mohammed. J.C.A., in his lead judgment, concurred by Ademola and Kutigi, J., J.C.A., observed as follows:

“I will agree that in the interest of justice it is essential to recognise the continuity of a business enterprises when on reorganisation, a new company takes over from an old or unincorporated firm. In the case in hand Chief N. Chiwete was the proprietor of Vitality Medicine Stores and he is the Managing Director of Vitality Pharmaceuticals Limited . I am satisfied that Chief Chiwete is the alter ego of these two enterprises and I agree that the new Company Vitality Pharmaceuticals Nigeria Limited is the successor in title of Vitality Medicine Stores and that they are entitled to the protection afforded by Section 7 of the Trade Marks Act, 1956 (sic 1965) in their use and marketing of “GONOCIN.”

In its ground of appeal No.6, the appellant complained that the Court of Appeal had erred in law and on the facts in affirming the decision of the trial court on a ground other than the ground relied upon by the trial court when the respondent had not given notice to contend in accordance with the requirement of Order 3 rule 14(2) of the Court of Appeal Rules 1981; when there was no evidence of any reorganisation in the respondent’s company, nor of a take over of the Vitality Medicine Stores by the respondent and, furthermore, when there was no evidence of the ground, to wit that the respondent was the successor in title of the stores, upon which the Court of Appeal relied. Referring to Eliochin v. Mbadiwe (1986) 1 N.W.L.R. (Pt.14) 47, learned counsel for the appellant contended that the Court of Appeal was wrong to have relied on the different ground when there was no notice to contend.
Now, Order 3 rule 14(2) provides:

“A respondent who desires to contend on the appeal that the decision of the court below should be affirmed on grounds other than those relied upon by the court must give notice to that effect specifying the grounds of that contention.”

The question is whether the Court of Appeal affirmed the decision of the trial court on grounds other than those relied upon by the trial court as has been contended by learned counsel for the appellant. It is only if the answer to the question is positive that the issue of non-compliance by the respondent with the provisions of the rule would become relevant.

It appears to me the grounds which I have fully set out earlier on, upon which both the Court of Appeal and trial court relied are the same. Their apparent difference is a matter of semantic rather than of substance. While the trial court treated the Vitality Medicine Stores and the Vitality Pharmaceuticals Ltd. as one and the same entity, the Court of Appeal treated the latter as the successor of the former. The evidence of the two respondent’s witnesses supported the conceptions of the trial court and of the Court of Appeal.

Chief Chiwete, D.W.1 testified as follows:

“I am the Chairman and Managing Director of the defendant Company. The defendant company was formerly registered under the business name, Vitality Medicine Stores before it was incorporated in May, 1980 under its present name. Before the defendants were incorporated, they were the representative of Dr. Herbrand K.G. of West Germany. Dr. Herbrand K.G. Company was a manufacturer of Pharmaceutical, drugs hormones and antibiotics. The defendants were sale Agents of Gonorcin Exhibit E, the product of Dr. Herbrand K. G. We have been dealing with that drug since 1968. I registered as Proprietor, Vitality Medicine Stores in 1956 and it was incorporated in May, 1980.”

Mr. Onwudinjo, D.W. 2, who left the Firm before its incorporation stated:

“I know the defendant’s Company.’ was a staff of the company from 1971 – 1980. Exhibit E is one of the products marketed by the defendants during the time I was working with them.”

It is clear from the evidence of the two witnesses that, so far as they were concerned, incorporation did not distinguish the Firm from the respondent as a limited liability company. The witnesses regarded the Firm and the Company as one and the same thing.

Under the circumstances the Court of Appeal was right to have relied on In re London Housing Society Limited’s, Trust Deed (1940) Ch.777 in regarding the Vitality Pharmaceuticals Ltd. as the successor of Vitality Medicine Stores. In that case, a pension fund was established by a trust deed for the benefit of the staff of a Society registered under the Industrial and Provident Societies Act, 1893. Subsequently, the Society was converted into a limited liability company which took over the business and staff of the Society. In holding that the Trust shall continue to be administered for the benefit of the staff of the company after incorporation, Farwell, J. made the following observations:

“In my judgment the only practical way of dealing with a question of this sort, having regard to the terms of the Act and the express provision in the Act for enabling a registered society to convert itself into a limited company, is to treat for this purpose the two things, the registered society and the limited company, as the same thing in different costume. The registered society, the employees of the society, and the objects of the trusts, are, as it were carried on, and continued in the same form as before except that the entity which employs them has a different name and a different structure from that which the society had. But in truth and in substance the society and the company are the same thing and, therefore, the trustees, if they continue to apply the trust funds for the benefit of the persons for whom they would have employed them had the registered society remained, will not be committing any breach of trust. They will in fact be carrying out the purpose of the trust and the reason for which it was established. In my judgment, therefore, the trustees remain in exactly the same position as they were in before, with the same duties, the same obligations, and the same class of beneficiaries, although they may not be the same beneficiaries as were existing before the change was made in 1939.”

For the foregoing reasons, I am satisfied the condition for invoking the provision of Order 3 rule 14(2) did not arise and the ground of appeal No.6 was misconceived.

A. G. KARIBI-WHYTE, J.S.C.: I have had the privilege of reading the judgment of my learned brother, Olatawura, J.S.C. in this appeal. I agree with the reasoning therein, and the conclusion that this appeal should be dismissed. It seems to me that the main plank on which appellants rested their case is on the proper construction of section 7 of the Trade Marks Act, 1965. I intend in this judgment to deal with that issue.

It was the case of the appellants as submitted by learned Counsel that the evidence relied upon by the respondents in support of the claim of a continuous user, within the meaning of section 7 of the Trade Marks Act, 1965 is inadmissible, and the trial Court was in error to have relied on it and the decision in Emegokwue v. Okadigbo (1973) 4 S.C.113. The contention is that the facts of earlier continuous user were not pleaded and that evidence led to establish it led to no issue.

It was also submitted that since the earlier capacity which the user of the Trade Mark GONORCIN was made by Registration of a business name, and the continued user was after incorporation as a limited liability company, it was incumbent on the respondent to put in evidence, both the Certificate of Registration of the Business Name and the Certificate of Incorporation as a Limited Liability Company. The argument was that since incorporation of a Company constitutes a person in law, the earlier user is not by the same persons after incorporation, and there was no admissible evidence indicating the nexus between the two.

I think it is necessary to admit the elementary but fundamental rule of pleadings that parties are bound by their pleadings. It is well accepted that the purpose of pleading is to reveal to the opposing party the nature of the case, at the earliest opportunity, he is likely to be confronted with. Having been so forewarned it is his responsibility to join issues with those aspects of the pleadings he disputes and considers the other side ought to establish. Where he declines to do so, and therefore has not joined issues, the facts so pleaded will be deemed to have been admitted.

Even if issues were joined, once the evidence of the party pleading is accepted by the court and this is consistent with the facts pleaded, the learned Judge will be right in accepting the facts as established. – See Nwabuoku v. Ottih (1961) 2 SCNLR 232; (1961) 1 All NLR (Pt.3) 487-90. In this case, appellant did not challenge the incorporation of the Company itself. Attention was focused rather on the date of incorporation. This it would seem was meant to negate the defence of continuous user pleaded by respondents. I think learned Counsel to the appellant was misled by the view he had taken of the relationship between the user of the name under Registration of Business Name, and after incorporation of the Business Name as Limited Liability Company. Learned Counsel ignored the vital and dominant consideration in section 7 of the Trade Marks Act, 1965, which is the continuous user of the registered Trade Mark. If he had carefully read the facts as pleaded in paragraphs 3,4,5,6 and 7 of the amended statement of defence, and the evidence of Chief Chiwete the 1st witness for the defendants, whose evidence remained uncontroverted, the fact of a continuous user of the registered Trade mark would have been clear and indisputable.

I shall now turn to the construction of section 7 of the Trade Marks Act, 1965 which provides-

“7. Nothing in this Act shall entitle the proprietor of a registered user of a registered trade mark to interfere with or restrain the use by any person of a trade mark identical with or nearly resembling it in relation to goods in relation to which that person or a predecessor in title of his has continuously used that trade mark from a date previous to-

(a) The use of the first-mentioned trade mark in relation to those goods by the proprietor or a predecessor in title of his; or

(b) The registration of the first-mentioned trade mark in respect of those goods in the name of the proprietor or a predecessor in title of his, whichever first occurred, or (where such use is proved) to object to that person being put on the register for that identical or nearly resembling trade mark in respect of those goods under section 13(2) of this Act.”

The words of the above provision seem to me clear and unambiguous. The section protects Trade Marks which are identical with, or nearly resembling that of a proprietor, or a registered user of a registered trade mark, where such trade mark has been in continuous use by another or his predecessor-in-title, previous to the date of the registration of the new trade mark. The protection covers both prior use of the trade mark, or the registration of the trade mark in the name of the proprietor or predecessor-in-title.

Concisely stated, the proprietor or registered user of a trade mark, is not entitled to interfere with an existing trade mark, even if identical with or nearly resembling his own if it has been in continuous use before the use of or registration of his own trade mark.

The evidence before the learned trial Judge and accepted by the Court below is that the issue and marketing of GONORCIN had been in the open market since 1968 long before the plaintiff registered his own in 1978, and defendant was incorporated in 1980. In 1978 the antibiotic GONORCIN was registered with the Pharmacy Board, Lagos, There has been a continuous user by the defendant of the name GONORCIN, since 1968. The plaintiff is therefore not entitled to interfere with the use by the defendant of the trade mark GONORCIN. Defendant is entitled to the protection of section 7 of the Trade Marks Act, 1965.

For the reasons I have given above, and the much fuller reasons of my learned brother, Olatawura, J.S.C. I hereby dismiss the appeal.

S. KAWU, J.S.C.: I have had the privilege of reading in draft, the lead judgment of my learned brother, Olatawura, J.S.C. which has just been delivered. I entirely agree with his reasoning and also with his conclusion that the appeal should be dismissed. For the reasons contained in the said judgment, I too will dismiss the appeal. There will be no order as to cost.

S. M. A. BELGORE. J.S.C.: I have read in advance the judgment of my brother, Olatawura, J.S.C. and I am in complete agreement with him that this appeal should be dismissed. I therefore for the same reasons contained in the lead judgment, which I adopt as mine, dismiss this appeal and make the same consequential orders as made therein.

III.CASES REFERRED TO

The following cases were referred to:

  • Vincent I. Bello v. Magnus A. Eweka (1981) 1 S.C. 101
  • Adejumo v. Ayantegbe (1989) 3 NWLR (Pt 110) 417
  • Niger Construction Ltd. v. Okugbeni (1987)4 NWLR (Pt. 67) 787.
  • Nwabuoku v. Ottih (1961) 2 SCNLR 232; (1961) 1 All NLR (Pt.3) 487-90
  • Nwadike v. Ibekwe (1987) 4 N.W.L.R. (Pt. 67) 718
  • Ayanwale v. Atanda (1988) 1 N.W.L.R. (Pt. 68) 22
  • Magaji v. Cadbury Nigeria Ltd. (1985) 2 N.W.L.R.(Pt. 7) 393
  • Onwuka v. Ediala (1989) 1 N.W.L.R. (Pt. 96) 182.
  • In re London Housing Society Limited’s, Trust Deed (1940) Ch.777

IV. JUDGEMENT

Appeal dismissed.

V. OTHER CITATIONS

(1991) All NLR 257

(1991) 2 NWLR (Pt.171) 15

(1991) 2 S.C 47

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