HC Deb 02 July 1937 vol 325 cc2366-73

1.24 p.m.

The Solicitor-General

I beg to move in page 20, line 2, to leave out "colour-ably resembling it" and to insert: so nearly resembling it as to be likely to deceive or cause confusion. This is the Clause which the right hon. Gentleman will remember we referred to as the Yeast-Vite Clause. It provides that there may be an infringement not only by the use of an identical mark but by one colourably resembling it. It is considered that this discription is not precise enough and, therefore, we propose to substitute the words of the Amendment which are more definite.

Amendment agreed to.

1.25 p.m.

Mr. Alexander

I beg to move, in page 20, line 14, at the end, to insert: Provided that in any action for infringement of the provisions of this section no injunction or other relief shall be granted if the defendant establishes to the satisfaction of the court that the use complained of is not as a trade mark or likely to deceive or cause confusion. I see that my hon. Friend the Member for Burslem (Mr. MacLaren) is in his place, and I may say at once that I shall be willing to incorporate in my Amendment his Amendment to it—in line 3, leave out "as a trade mark or." On the other hand, if the Government are ready to accept my proviso as it stands, without the wider application of it to which my hon. Friend attaches importance, then I shall be willing to accommodate them in that direction, subject to the consent of my hon. Friend. Although in the last Amendment that was carried the Solicitor-General undoubtedly endeavoured to remove some of the doubts that we had in our minds as to the interpretation in the courts of such words as "colourably resembling," nevertheless I feel that in this matter there ought to be a reasonable basis for a defence in the court of the persons accused. In that respect, the words of this Amendment seem to me to be eminently reasonable. I should have thought that the Amendment would have appealed to a lawyer such as the Solicitor-General as being a reasonable one, and I should have thought that he would have accepted it.

Trade marks are granted and used for the purpose of distinguishing goods manufactured or sold by the owners of the marks from goods manufactured or sold by other persons. I want to stress what I said in the Committee upstairs in this connection, tint when this Bill is passed, even more than before, the trade marks concerned will be in the nature of a monopoly. In those circumstances I feel that no injunction, damages, costs or other relief should be granted if the defendant can find the satisfactory explanation for which we are providing in the amendment. There are many ways in which traders may commit what may be alleged to be an infringement and be liable to have proceedings taken against them which no ordinary citizen would desire to see take place. I do not think it is ever in the public interest to encourage proceedings where nothing has really been done from the point of view of confusing or misleading the buying public. I hope that the fact that I do not make a longer argument on the point will not cause the Solicitor-General to be less inclined to accept the Amendment. I think the Amendment is a reasonable one and I hope he will accept it.

1.30 p.m.

The Solicitor-General

I am afraid I cannot accept the Amendment, and I hope that the right hon. Gentleman will agree with me in this, at any rate, that the brevity with which he made the point in the Committee upstairs has not resulted in our overlooking it or neglecting to reflect upon it. This Amendment, however, raises a point of such substance that I do not think it is possible for the Government to accept it consistently with the policy to which they have committed themselves by introducing the Clause. That policy arises out of a case known as the Yeast-Vite case. In that case it was held in the House of Lords that it was not an infringement of a trade mark to sell goods with a label which said "as good as Yeast-Vite," or words to that effect. The Committee recommended that that was a very unsatisfactory state of the law. I do not for a moment suppose that the right hon. Gentleman would defend the practice that was held to be within the law in the Yeast-Vite case. Hon. Members will observe that the vice that was disclosed in that case was a vice of adding something to the trade mark so that it was not used as a trade mark. If I were to accept the Amendment, we should not deal with the Yeast-Vite case at all, because the Amendment would limit the action for infringement for which we are providing in Clause 15 to cases where the use is use as a trade mark. The Yeast-Vite case was one where use was not use as a trade mark, but in another way. The right hon. Gentleman's Amendment runs entirely counter to the policy which we stand by of reversing the decision in the Yeast-Vite case, and that is the first reason why the Amendment is not acceptable.

There is another reason. This Clause deals only with registered trade marks in Part A of the register; that is to say, trade marks which are of the highest quality of trade mark, differing from those in Part B of the register. In the case of Part B trade marks, which are not so sacrosanct, it is a good defence to say that the mark has not been used in such a way as to be likely to deceive. That is no defence in the case of trade marks registered in Part A. Therefore, the right hon. Gentleman's Amendment would assimilate the Part A marks to the Part B marks, and would leave very little advantage in being in Part A of the register. For those two reasons, I am afraid the Amendment raises such a large question of policy that plainly we cannot accept it.

Mr. Alexander

Would not the first point raised by the hon. and learned Gentleman be met if he were to accept with my Amendment the Amendment of my hon. Friend the Member for Burslem (Mr. MacLaren)?

The Solicitor-General

I think that that would make it much worse. I always fear the Greeks when they come bearing gifts. I did not look upon the hon. Gentleman's Amendment as being intended to help the Government out of the difficulties in which they find themselves. The effect of Subsection (1, b) of the Clause is to cover the case where use of the trade mark is not use as a trade mark, and is not likely to deceive or to cause confusion. That was the very case of "a substitute for Yeast-Vite," so that the omission of the words, "as a trade mark or," and the retention of the other words, "likely to deceive or to cause confusion" would still nullify what we want to do. You cannot say that the putting in of the words "a substitute for Yeast-Vite" is calculated to cause confusion. It is not. It does not say that the article is Yeast-Vite. It only says that the article is a substitute. But the vice in that case was that it was an attempt by one trader to sell his goods by reference to the goodwill established by somebody else, and that vice we should not defeat if the Clause were amended in the manner proposed.

1.36 p.m.

Mr. Barnes

I have not found the reply of the Solicitor-General very satisfactory. I am never impressed by legislation which while endeavouring to deal with one evil proposes to create others. In the Yeast-Vite case the design was, more or less, to deceive the public but why, in attempting to deal with that matter, should we pass legislation which may work out in a very arbitrary fashion, and seriously affect a large body of traders who have no design whatever to deceive the public? The Amendment seems to me to be the natural sequence to the Government Amendment which we have just carried. I do not see why there should be any moral distinction between categories A and B under the trade mark law when it comes to affecting the rights of other traders. The Amendment which the Government have just submitted to overcome administrative and legal difficulties arising out of the words "colourable resemblance," introduces such language as "so nearly resembling as to be likely to deceive." Obviously what we are endeavouring to secure here is that there should be no deliberate fraud imposed on the public.

The Solicitor-General indicated dissent.

Mr. Barnes

Then what is the purpose of the Clause? I shall be glad to give way if we can have an explanation of it.

1.38 p.m.

Captain Wallace

The Solicitor-General has already explained the purpose of the Clause. It is to reverse the Yeast-Vite judgment and to prevent Trader A from trying to sell his goods by reference to a standard which has already been set up by Trader B. Even if his representations do not deceive the public, we believe that to be a wrong practice, and I do not believe it is a practice which the hon. Gentleman himself would condone. If that be so, it seems to me—and I am no lawyer—that to alter the Clause in the way proposed would completely defeat the object which I think we are all trying to achieve.

When I am on my feet may I say that we have gone a long way towards meeting the points made in Committee by the right hon. Gentleman the Member for Hillsborough (Mr. Alexander) and the hon. Member for East Ham South (Mr. Barnes). We have made it clear that it is open to any trading organisation to send round circulars within their organisation saying "We have some goods which we believe to be as good as A. or B. and we want to try to sell them." We have also removed from any penalty under this Measure what was described in Committee as "oral boosting." A person saying, for instance, "Do not buy that, we have something which is just as good," would have rendered himself liable to a penalty under the Bill as it stood originally, but we have deliberately excluded that. We are determined, however, to prevent if we can the practice of trying to sell one's own goods by reference to the standard which has been set up by somebody else, and, as I say, I do not think hon. Gentlemen opposite themselves would condone that practice.

1.42 p.m.

Mr. Barnes

It is becoming the habit on the Treasury Bench to deal with Amendments proposed from this side by saying that they defeat the purpose of the Clause without giving any argument to show that that is so. It is useless for the Parliamentary Secretary to direct questions at my right hon. Friend and myself as to whether we would stand for a practice such as that described in the Yeast-Vite case. Of course we would not, but that is no argument. We are not concerned with that. What we are concerned with is that when Parliament sets out to remedy an abuse which has been discovered in the trade marks law, it should not do so in such a way as to cause irritation among the great body of normal traders. Why should such abuses lead to a type of legislation which is restrictive on the great body of traders, who have no intention to defraud the community? Why, as a result of an abuse by one Mader, should the law of

monoply embodied in trade mark legislation be strengthened in this way, with no safeguard for the trader who may make an honest mistake in his literature or in some other way?

What amazes me is the lack of confidence in the courts shown by the Solicitor-General. All the Amendment seeks to accomplish is that the defendant should establish to the satisfaction of the court that the abuse complained of is not likely to deceive or cause confusion. Surely that is sensible and reasonable. Why should a trader who has no intention of defrauding the public, be prevented from establishing that before the court, and if he does establish it, why should he be held guilty of an offence and become liable to penalties? Neither the Solicitor-General nor the Parliamentary Secretary made any case against the Amendment. Hon. Members who move these Amendments cannot be expected to draft them with the same accuracy as Ministers who have the aid of their advisers but surely the Government will recognise that this request is reasonable and, if they cannot accept these words, will agree to introduce some other words to meet our point.

Question put, "That those words be there inserted in the Bill."

The House divided: Ayes, 58; Noes, 105.

Division No. 258.] AYES. [1.44 p.m.
Adamson, W. M. George, Rt. Hon. D. Lloyd (Carn'v'n) Naylor, T. E.
Alexander, Rt. Hon. A. V. (H'lsbr.) George, Major G. Lloyd (Pembroke) Oliver, G. H.
Ammon, C. G. Greenwood, Rt. Hon. A. Pethick-Lawrence, Rt. Hon. F. W.
Anderson, F. (Whitehaven) Griffith, F. Kingsley (M'ddl'sbro, W.) Rathbone, Eleanor (English Univ's.)
Barnes, A. J. Groves, T. E. Ritson, J.
Bellenger, F. J. Hall, G. H. (Aberdare) Robinson, W. A. (St. Helens)
Benn, Rt. Hon. W. W. Hall, J. H. (Whitechapel) Rowson, G.
Brown, C. (Mansfield) Harris, Sir P. A. Smith, Ben (Rotherhithe)
Brown, Col. D. C. (Hexham) Henderson, A. (Kingswinford) Smith, E. (Stoke)
Charleton, H. C. Henderson, T. (Tradeston) Sorensen, R. W.
Cluse, W. S. Jenkins, A. (Pontypool) Strauss, G. R. (Lambeth, N.)
Cocks, F. S. Jones, Morgan (Caerphilly) Taylor, R. J. (Morpeth)
Cove, W. G. Kelly, W. T. Thorne, W.
Daggar, G. Kennedy, Rt. Hon. T. Thurtle, E.
Davidson, J. J. (Maryhill) Kirkwood, D. Viant, S. P.
Davies, S. O. (Merthyr) Lathan, G. Watkins, F. C.
Ede, J. C. Lawson, J. J. Windsor, W. (Hull, C.)
Edwards, Sir C. (Bedwellty) Leslie, J. R.
Evans, E. (Univ. of Wales) McEntee, V. La T. TELLERS FOR THE AYES.—
Frankel, D. MacLaren, A. Mr. Whiteley and Mr. Mathers.
Gardner, B. W. Morrison, R. C. (Tottenham, N.)
NOES.
Albery, Sir Irving Boulton, W. W. Clarke, Lt.-Col. R. S. (E. Grinstead)
Anstruther-Gray, W. J. Briscoe, Capt. R. G. Colville, Lt.-Col. Rt. Hon. D. J.
Assheton, R. Brocklebank, Sir Edmund Conant, Captain R. J. E.
Balfour, Capt. H. H. (Isle of Thanet) Bull, B. B. Cooke, J. D. (Hammersmith, S.)
Beaumont, Hon. R. E, B. (Portsm'h) Campbell, Sir E. T. Craven-Ellis, W.
Bernays, R. H. Cary, R. A. Crooke, J. S.
Crockshank, Capt. H. F. C. Loftus, P. C. Shaw, Major P. S. (Wavertree)
Cross, R. H. MacAndrew, Colonel Sir C G. Somervell, Sir D. B. (Crewe)
Davies, Major Sir G. F. (Yeovil) McCorquodale, M. S. Somerville, A. A. (Windsor)
Denville, Alfred Macquisten, F. A. Southby, Commander Sir A. R. J.
Duckworth, W. R. (Moss Side) Maitland, A. Stanley, Rt. Hon. Oliver (W'm'l'd)
Emmott, C. E. G. C. Makins, Brig.-Gen. G. Strauss, H. G. (Norwich)
Everard, W. L. Margesson, Capt. Rt. Hon. H. D. R. Strickland, Captain W. F.
Fildes, Sir H. Mayhew, Lt.-Col. J. Stuart, Hon. J. (Moray and Nairn)
Gluckstein, L. H. Mellor, Sir J. S. P. (Tamworth) Sueter, Rear-Admiral Sir M. F.
Goldie, N. B. Morrison, G. A. (Scottish Univ's.) Tasker, Sir R. I.
Grant-Ferris, R. Morrison, Rt. Hon. W. S. (Cirencester) Tree, A. R. L. F.
Grattan-Doyle, Sir N. Neven-Spence, Major B. H. H. Tryon, Major Rt. Hon. G. C.
Gridley, Sir A. B. Nicholson, G. (Farnham) Tufnell, Lieut.-Commander R. L.
Grimston, R. V. Nicolson, Hon. H. G. Walker-Smith, Sir J.
Gunston, Capt. D. W. O'Connor, Sir Terence J. Wallace, Capt. Rt. Hon. Euan
Guy, J. C. M. Ormsby-Gore, Rt. Hon. W. G. A. Ward, Lieut.-Col. Sir A. L. (Hull)
Hannah, I. C. Orr-Ewing, I. L. Ward, Irene M. B. (Wallsend)
Hannon, Sir P. J. H. Palmer, G. E. H. Waterhouse, Captain C.
Heilgers, Captain F. F. A. Petherick, M. Williams, H. G. (Croydon, S.)
Hepburn, P. G. T. Buchan- Ponsonby, Col. C. E. Wilson, Lt.-Col. Sir A. T. (Hitchin)
Hills, Major Rt. Hon. J. W. (Ripon) Raikes, H. V. A. M. Windsor-Clive, Lieut.-Colonel G.
Hope, Captain Hon. A. O. J. Ramsay, Captain A. H. M. Winterton, Rt. Hon. Earl
Hudson, R. S. (Southport) Ramsbotham, H. Withers, Sir J. J.
Hutchinson, G. C. Reid, Sir D. D. (Down) Womersley, Sir W. J.
Kerr, H. W. (Oldham) Reid, W. Allan (Derby) Young, A. S. L. (Partick)
Kerr, J. Graham (Scottish Univs.) Rickards, G. W. (Skipton)
Lamb, Sir J. Q. Rosbotham, Sir T. Wright, Squadron-Leader J. A. C.
Liddall, W. S. Ross Taylor, W. (Woodbridge) TELLERS FOR THE NOES.—
Little, Sir E. Graham Samuel, M. R. A. Captain Dugdale and Mr. Munro.
Llewellin, Lieut.-Col. J. J. Savery, Sir Servington

Bill read the Third time, and passed, with Amendments.