Cape Town Lodge CC v Registrar of Close Corporations and another
 2 All SA 34 (C)
CAPE OF GOOD HOPE PROVINCIAL DIVISION
18 September 2007
DB NTSEBEZA AJ
C Webster SC and AD Maher
. Editor's Summary . Cases Referred to . Judgment .
Intellectual property Trade marks Whether registered name is undesirable Court setting out applicable legal principles
and nature of enquiry.
The dispute between the parties in this case had its genesis in the applicant's being informed by the Registrar of
Close Corporations, that its registered name was undesirable. The Registrar had been acting in response to an
objection to the name.
In the main application before the present Court, the Court was being asked to set aside the Registrar's decision,
and to dismiss the objection referred to above.
In a counterapplication, the second respondent invoked section 34 of the Trade Marks Act 194 of 1993 for
alleging that two of its registered marks, both of them word marks, viz "Town Lodge" and "Town Lodge Limited"
were infringed. In support of its argument, reliance was placed on section 34(1)(a) of the Act. Reliance was also
placed on the common law in alleging that the applicant was passing off its business and hotel services as those of
the second respondent, or as being associated in the course of trade with the second respondent by using, in
relation to its services, the mark "Cape Town Lodge".
Held The Court considered what would constitute an undesirable name in such enquiries. It held that where there
is a likelihood that members of the public will be confused in their dealings with the competing parties, the Court
would consider those as important factors to take into account when considering whether or not a name was
desirable. If there is a likelihood of confusion in registering a company name because of the similarity of names,
then it would be undesirable to register a particular company or close corporation name. The court has to weigh up
which of the two litigants will be more inconvenienced by its order.
One of the first questions to be addressed was whether "Cape Town Lodge" so nearly resembled "Town Lodge"
as to be likely to deceive or cause confusion.
In order to show infringement under section 34(1)(a) the applicant has to establish in respect of its trademark:
unauthorised use; in the course of trade; in relation to goods and services in respect of which the mark was
registered; of an identical mark or a mark so nearly resembling it as to be likely to deceive or cause confusion.
The enquiry into the likelihood of confusion or deception is limited to a comparison of the marks. The onus rests
on the plaintiff to show on a balance of probabilities, that the mark used by the defendant so nearly resembles the
plaintiff's trade mark as to be likely to deceive or cause confusion. It is enough
Page 35 of  2 All SA 34 (C)
for the plaintiff to show that a substantial number of persons will probably be confused as to the origin of the goods
or the existence or nonexistence of such a connection.
The Court found that the use of the generic words "Cape" and "Town" in the applicant's name meant that the
name could not be regarded as undesirable. It granted the relief sought by the applicant in the main application.
The counterapplication was dismissed with costs.
For Intellectual property see:
LAWSA First reissue Vol 29
Cases referred to in judgment
Abbott Laboratories and others v UAP Crop Care (Pty) Ltd and others
 1 All SA 502 (1999 (3) SA 624) (C)
Adidas Sportsschufabriken ADI Dassler KG v Harry Walt & Co (Pty) Ltd
1976 (1) SA 530 (T)
Albion Chemical Co Pty (Ltd) v FAM Products CC  1 All SA 194
(2004 (6) SA 264) (C)