UNIC Centre SARL (A Company) v The London Borough of Brent and Harrow Trading Standards Service and Harrow Crown Court.

Date

15 December 1999

Legislation

Trade Descriptions Act 1968 ss1,11
Trade Marks Act 1994 ss16, 17, 18, 19, 27, 92, 93, 97
Brussels Convention on Jurisdiction in Civil and Commercial Matters 1968
Civil Jurisdiction and Judgments Act 1982

Keywords

forfeiture; conflict of laws; nature of forfeiture proceedings; res judicata; trading standards prosecution role; criminal offences

Counsel

Alan Tyrrell QC for the Applicant, Simon Mehigan QC for the Respondents

Solicitors:

South & Co; London Borough of Brent and Harrow Council Solicitor

Judge:

Newman J

Court:

Queens Bench Division (Crown Office List)

Reported:

[2000] 1 WLR 2112, [2000] 2 All ER 449, [2000] ETMR 595, [2000] FSR 667

Summary:

This was a judicial review application bought by UNIC Centre Sarl ('UNIC') in connection with s97 of the Trade Marks Act 1994 as a result of a forfeiture action relating to 9,312 pairs of jeans with an approximate value of £200,000 and bearing the mark Levi Strauss. UNIC was a French company and carried on a wholesale business in France.

The Court was concerned with two judgments of the Tribunal de Grande Instance of Marseilles. In the first, Levi Strauss, the trademark proprietor, claimed against UNIC that the jeans infringed its trademark because they were not made by Levi Strauss. The action failed. In the second set of proceedings Levi Strauss obtained an ex parte order in the nature of a freezing injunction which enabled it to seize the jeans. The court set aside the order on a hearing between the parties on the ground that the issue was res judicata by reason of the previous judgment of the court. The jeans then went into free circulation in France. UNIC entered into a contract of sale of the jeans to a company called Kilfol Limited, and the jeans were exported to England. The Local Authority was enlisted at the request of Levi Strauss and issued two informations dated 20 November l997 against Kilfol Ltd: (1) a summons alleging an offence contrary to S.92(1) of the Trademarks Act l994, and (2) a summons alleging an offence contrary to S.1(1)(6) of the Trade Descriptions Act l968.

On the same day the Local Authority issued two complaints whereby it applied for forfeiture of the jeans. The complaints were made respectively by reference to the provisions of the Trademarks Act l994 and the Trade Descriptions Act l968. The informations were not proceeded with because an understanding was reached between the Local Authority and Kilfol Limited, including agreement that Kilfol would not oppose an application for forfeiture, which the local authority intimated it intended to make.

The Crown Court confined itself to consideration of the question whether the Civil Jurisdiction and Judgments Act l982, which implemented the l968 Brussels Convention on the enforcement of judgments in civil and commercial matters, applied to the proceedings in the magistrates court. The judgment records that UNIC submitted that having regard to the judgments in the French courts, which had been registered in this jurisdiction, the magistrates court acting in the exercise of its civil jurisdiction, was not entitled to make an order for forfeiture of the jeans. The argument as to whether the jurisdiction under s97 was civil or criminal was advanced for both sides by reference to the character of the proceedings before the magistrates. The judgment of the court, having recited the arguments advanced and the provisions which it had to consider, concluded:

"In our view once proceedings have been brought the order by the magistrates was an order which they were entitled to make within their powers under s.97(2)(a) and being made on application by the respondents in court on the basis that the agreement between the parties to the criminal proceedings, it was made within the criminal jurisdiction of the court. In view of our finding we do not need to go on to consider the many interesting questions which might have arisen under the Convention, but would have to go on to consider in the course of a rehearing the evidence on other issues which may be outstanding."

UNIC then asked the court to adjourn the hearing so that the judgment could be tested in the High Court - if UNIC succeeded in this application the matter must then go back to the Crown Court for the Crown Court to consider, along with all the other material in the case, what effect the judgments have on the issues which the court must determine. If thus followed that the only question which arises on the application to the High Court was the issue of whether the proceedings in the Crown Court are civil or not, within the meaning of the 1982 Act and the Convention.

The High Court considered s97 of the Trade Marks Act and concluded that it entitles any person to apply for forfeiture where that person has come into the possession of goods in connection with the investigation or prosecution of a relevant offence. There does not have to have been a prosecution to conviction, nor even an existing prosecution.

An investigation will be sufficient if combined with possession. It was noted that the right to apply for forfeiture conferred by s.97 is obviously of particular value to the trading standards service of a local authority, for it will, in a variety of circumstances, be a person coming into possession of goods in the circumstances envisaged by the section. Important though the power may be to a local authority it is nevertheless capable of being exercised by any person, for example the registered trademark proprietor or the licensee of the trademark, so long as the qualifying circumstances set out by the section exist.

The l968 Brussels Convention, in company with other Conventions, was incorporated into English law by the Civil Judgments and Jurisdiction Act l982. In this case the meaning and effect of Article l of the Brussels Convention is in issue. Article l provides: "This Convention shall apply in civil and commercial matters whatever the nature of the court or tribunal. It shall not extend, in particular, to revenue, customs or administrative matters. The Convention shall not apply to ....... " The provisions of the Convention relating to civil and commercial matters extend so as to require, where necessary, consideration to be given to the character of the judgment in respect of which enforcement may be sought and to the character of the proceedings in which enforcement may be required.

The scheme and purpose of the forfeiture provisions (including S.16-19) of the Trademarks Act is to prevent infringing articles entering into circulation in the market to the prejudice of the registered trademark proprietor and to the prejudice of traders and consumers, who may be induced to deal with the counterfeit items. It is common for there to be contractual complexity underlying the sale of goods in the market and as a result a number of persons may acquire an interest in the goods and a right to be heard before an order for forfeiture is made or, if made, upheld on appeal.

Although for the magistrates to have jurisdiction under Section 97 the person in possession must be in possession for the purposes of prosecution or investigation into a relevant offence, the forfeiture order cannot be regarded as a penalty or an essential part of the prosecution of the criminal offence. The forfeiture process comprises a court procedure for working out the consequences of the commission of a criminal offence in connection with goods, having regard to the commercial and proprietary interests of persons who have entered into transactions in connection with the goods in question. Section 97 of the Act provides a means whereby persons can apply to the court to protect their private interests. Additionally, it avails local authorities in the conduct of their functions. Section 93 of the Trademarks Act l994 imposes a duty on every local weights and measures authority to enforce the provisions of s.92. In the discharge of that duty the authority will regularly come into the possession of infringing goods in the course of the investigation or prosecution of a relevant offence. But the local authority have a duty to prosecute, and do not have a duty to apply for forfeiture, although it is plainly a great convenience for them to be able to do so, in order to avoid being in possession of an enormous number of infringing objects.

Further, it was held that a local authority has a public interest, which it can serve by making an application for forfeiture, namely the protection of many individuals who may be prejudiced should the infringing articles enter into the market. Although properly regarded as a public interest, it represents a right and power to act in the public interest by bringing proceedings to protect the collective body of private interests, too numerous and unidentified for it to be practical to envisage proceedings being taken by them. That said, the circumstances of possession are not unique to the local authority, and the form of relief by way of forfeiture has no specific public authority character.

Decision

It was held that the correct answer to the preliminary point which has been argued before the High Court was that the forfeiture proceedings pursuant to Section 97 of the Trademarks Act l994 and an appeal by way of an aggrieved person to the Crown Court in respect of a forfeiture order are proceedings to which the Convention applies being proceedings in a civil matter.