Nino's Coffee Bar & Restaurant CC v Nino's Italian Coffee & Sandwich Bar CC and another
[1998] 3 All SA 527 (C)
Division:
Cape of Good Hope Provincial Division
Date:
8 April 1998
Case No:
7405/97 and 10660/97
Before:
RoseInnes AJ
Sourced by:
G Josman; ML Sher and AD Maher
Parallel Citation:
1998 (3) SA 656 (C)
. Editor's Summary . Cases Referred to . Judgment .
Sale of business Goodwill The legal position with regard to the sale of goodwill and name of a business is clear In the
absence of any term to the contrary a sale and transfer of goodwill confers upon the transferee the exclusive right to
carry on the business transferred and the exclusive right to represent himself as carrying on such business It also
confers upon him the exclusive right to use the name under which the business has been conducted.
Trade and competition Passing off Requirements (i) Applicant had acquired a reputation or goodwill in the sense that
the name, getup or mark used by it had become distinctive of the goods or services by virtue of the fact that the public
associates the name,
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getup or mark with the goods or services provided (ii) Respondent was by the name, getup or mark used by him
expressly or impliedly misleading the public into thinking that the goods or services are those of the Applicant or that
there is an association between them (iii) Such conduct results, or is calculated to result, in damage to the Applicant as
a consequence of the infringement of his goodwill, reputation or trade.
Trade and competition Passing off Unlawful competition Test for passing off Whether there was a reasonable
likelihood that ordinary members of the public may be confused or deceived into believing that the business of the alleged
wrongdoer was connected to that of the aggrieved party Court held that passingoff was a form of wrongful competition
It is unlawful because it results or is calculated to result in the improper filching of another's trade, an improper
infringement of his goodwill and/or because it may cause injury to that other's trade reputation.
Trademark infringement Defences to Trade Marks Act 194 of 1993 Section 34(2)(a) provides that a registered trade
mark is not infringed by "any bona fide use by a person of his own name, the name of his place of business, the name of
any of his predecessors in business, or the name of any such predecessor's place of business" In order to succeed with
this defence it must be established that the Applicant was using its own name, the name of its place of business, the
name of a predecessor or the predecessor's place of business, that such use is bona fide and that it is consistent with fair
practice Section 34(2)(a) seeks to protect the use by a person of his own name What is generally required however is
the use of the full name The use of a surname does not suffice.
Trademark Trade Marks Act 194 of 1993 Section 36(1) Purpose of this section is to prevent a proprietor of a trade
mark from exercising his rights merely on the basis of priority of registration and it preserves whatever commonlaw
rights there may be antecedent to the rights of the registered proprietor The Applicant could only rely on this section if it
has made continuous and bona fide use of the trade mark from a date earlier than the use of the trade mark by the
proprietor or his predecessor in title or from a date prior to the registration of the trade mark in the name of the proprietor
or his predecessor in title, whichever is the earlier.
Editor's Summary
Two consolidated applications raised issues relating to an alleged passing off and an alleged trade mark
infringement. The essential dispute between the parties concerned the right to use the name "Nino" or "Nino's" in
the course of business in Cape Town and its surrounding areas. A member of the Applicant ("Zanasi") had
previously owned a coffee shop by the name of "Nino Coffee and Sandwich Bar"("the coffee shop") which was
situated in Braamfontein and which he sold to a member of the First Respondent ("Korkorris"). Thereafter the
Applicant opened two restaurants in the Cape Town area using the name Nino Coffee Bar & Restaurant. The First
Respondent had, after its acquisition of the coffee shop from the Applicant, carried on business as a franchisor of
coffee bars under the name "Nino's Italian Coffee and Sandwich Bar". The First Respondent's principle place of
business was in Johannesburg, with coffee bars predominantly situated in Gauteng and two being situated in
Cavendish Square and Claremont in the Western Cape. The First Respondent was also a franchisor of coffee bars
under the name "Nino's Internet Cafe" and the proprietor, in South Africa, of a registered trade mark in respect of
Nino's Italian Coffee and Sandwich Bar ("the trade mark"). This was the trade mark under which it had always
conducted its franchise business.
On 30 May 1997 the Applicant brought an application ("the first application") as a matter of urgency for an order
interdicting and restraining the First
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