asked for an option to give them time to think about it. The parties then executed and signed a written option at a
price of R250 000. Some days later, after
View Parallel Citation
further negotiations, the parties agreed telephonically on a price of R225 000. The Khans' attorney was to draw up
a written contract.
The contract was not forthcoming. Mrs Pead phoned Mr Khan to find out what was happening. He told her that
he had been approached by attorneys acting for McDonald's and that the price he had agreed with Mrs Pead was
made to look "not only like peanuts but dried peanuts". He now wanted offers that were "telephone figures". No
amount of persuasion could change his attitude, and Joburgers brought an urgent application to restrain Mr and
Miss Khan and her close corporation from selling, alienating or otherwise disposing of the business. An order to this
effect was granted. Ultimately, on 22 November 1993, the parties entered into a new contract of sale at a price of
R350 000.
Page 9 of [1996] 4 All SA 1 (A)
In the meantime the proceedings between McDonald's and Joburgers were continuing. On 15 November 1993
Joburgers served answering affidavits and a counter application. The main relief sought in the counter application
was the expungement of the McDonald's trade marks in terms of section 36(1)(a) and (b) of the old act, i.e., on the
grounds, broadly stated, that the marks were registered without any bona fide intention on the part of McDonald's
that they should be used and that they had in fact not been used for the periods required by the section.
Early in 1994 McDonald's became aware that Joburgers was conducting the business in Durban under the name
MacDonalds. McDonald's immediately launched proceedings for relief on the grounds that Joburgers was in
contempt of court it was contravening the order granted by consent on 28 September 1993 in terms of which
Joburgers undertook (and was ordered) not to infringe the registered McDonald's trade marks. The matter came
before Nugent J. On 15 March 1994 he declared that Joburgers was in contempt of the earlier order and that all
proceedings in respect of its counterapplication to expunge the McDonald's trade marks be stayed until it had
purged its contempt.
On the very next day Joburgers' attorney wrote to the attorneys for McDonald's to say that Joburgers had
disposed of the business. Requests by McDonald's for further information about the disposal proved fruitless.
In May 1994 it came to the notice of McDonald's that the MacDonald's business in Durban was being conducted
by Dax Prop CC ("Dax"). The sole member of Dax is Mr George Charalambous. He has worked as a baker and
hotelier. In 1988 he gave up his employment to commence his own business as a franchisee of Chicken Licken. He is
now the sole director and shareholder of a company which has six Chicken Licken franchises and a member of a
close corporation which also has several franchises. These are all in KwaZulu Natal. Mr Charalambous is responsible
for the management of all these businesses.
On 17 May 1994 McDonald's wrote through its attorneys to Dax asking, inter alia, for an undertaking that Dax
cease forthwith to use the trade mark MacDonalds or any other trade mark which is deceptively or confusingly
similar to McDonald's, failing which proceedings would be instituted.
No such undertaking was given.
On 25 May 1994 Dax applied to register the mark MacDonald's in
View Parallel Citation
classes 29, 30 and 42. On 9 August 1994 Dax launched an application, also in the Transvaal Provincial Division,
against McDonald's seeking expungement from the register of the trade marks relied upon by McDonald's in its
letter of 17 May 1994. Dax also sought some additional relief which need not be set out. McDonald's bought a
counterapplication for an interdict preventing Dax from infringing its trade marks.
At this stage the position then was that, in the Joburgers application, McDonald's applied against Joburgers for
an interdict to restrain trade mark infringement and Joburgers sought, in a counterapplication, expungement of the
marks, whereas in the Dax application, Dax asked for expungement and McDonald's, in the counterapplication,
asked for an interdict.
On 1 May 1995 the Trade Marks Act, no 194 of 1993 ("the new act") came into force. Section 35 of the new act
provides for the protection of "wellknown" trade marks emanating from certain foreign countries. On 20 June 1995
McDonald's brought an application against Joburgers and
Page 10 of [1996] 4 All SA 1 (A)
Dax under section 35 of the new act. It claimed that all 52 of its trade marks are wellknown marks in terms of the
section, and sought an order that Joburgers and Dax be interdicted and restrained from imitating, reproducing or
transmitting those marks in the Republic of South Africa. I shall call this the "wellknown marks application".
Section 71 of the new act repealed the old act. However, section 3(2) of the new act provides that all
applications and proceedings commenced under the repealed act shall be dealt with in accordance with the