JESSEL, M.R.:-
This is a motion founded on the 20th section of the Companies Act, 1862, and that section only applies to taking the name of a subsisting company already registered. Why it should have been confined to that, I am quite unable to say, but it is confined to that, and the objection is taken that the present company, the Plaintiff, is not a registered company, and that, therefore, the section does not apply at all. That objection once made appears to me to be entirely fatal to this application. Then, Mr. Chitty, if he will allow me to say so, I think had better not have wasted the time of the Court by attempting to bolster up a case founded on a mere mistake, by setting up a totally different equity than that which is either alleged or proved.
The writ which I have got before me is this:- “For an injunction to restrain the Defendants from applying to the Registrar of Joint Stock Companies in England for registration under the Companies Act of a company to be incorporated under the name of the Universe Life Assurance Association, or any other name likely to mislead or deceive the public into the belief that the company, being incorporated as aforesaid, is the same as the Universal Life Assurance Society.” It is exactly under the Act of Parliament. Of course there is no such equity. You may register in any name, whether the name is likely to deceive or not, because you may carry on business in such a way that you will not deceive. There is nothing to prevent a company registering in the same name. They may carry on a totally different business. Supposing the company’s name was the Universal alone – the Universal Company – if it were not for the Act of Parliament you might have a similar Universal Company; but the first company might be a life insurance company and the second a fire insurance company. You could not restrain it. The mere identity of name will not do. Suppose the first company was dealing in manure and the second in hardware, you could not restrain it. I am thinking of the same identical name. That is not a ground for an injunction. As I have already explained, the ground for an injunction is the fraudulent attempt to appropriate other persons’ or other companies’ business.
Well, then, the next part of the writ is this: “From issuing or publishing any advertisements, circulars, or prospectuses representing that a company is to be incorporated pursuant to the Companies Act under the name of the Universe Life Assurance Association, Limited, or any such other name as aforesaid.” – What equity there is for that I am utterly at a loss to understand, either in the Act or anywhere else, to prevent the registration. Why a man shall not advertise that a company is going to be incorporated under that name I cannot understand. – “And from carrying on or commencing any business under the name of the Universe Life Assurance Association, Limited, or any such other name as aforesaid.” It is to restrain them from carrying on business under a particular name. That you cannot do. You can restrain them from doing it either where it is done with the intent to appropriate the Plaintiff’s business or where it, in fact, does appropriate unfairly the Plaintiff’s business, although the actual intent – that is, the moral intent to commit fraud, or rather the immoral intent – is not proved. You must have that.
It is the unfair appropriation of a portion of the Plaintiff’s business which is prevented by injunction. A man may incorporate a company and not carry on business at all, or may carry on a totally different business. Therefore, it seems to me that the whole injunction asked by this writ is simply pursuant to the section of the Act of Parliament. But even if it were otherwise, it would not do. If the affidavits had stated that which I must say, in fairness to the deponents, the affidavits do not state at all – that it was not possible to carry on business under this name without appropriating unfairly a portion of the Plaintiff’s business; even then you could not get an injunction, because the answer would be, “That is your opinion, but there is an opinion on the other side that you can do it.” And I put a case to illustrate it. Suppose this new company carrying on the business it intends to carry on, establishes itself in Birmingham or Liverpool, which it may do. It may have its temporary office within a few yards of you, but it may have its registered office somewhere else. What would you say then? It is quite plain that they can carry on business in a way which will not represent their business as being the business of the Plaintiffs, and that, even if they had the same name and not a similar name, they could do it, supposing they put at the top of their prospectus, or at the top of their door, “No connection with any insurance company called the Universal, established at such a place, or with any other company of a similar name.” I do not say they will carry on business in that way, but they might; and as to injunctions which are called injunctions quia timet, it is essential to shew that what the Defendant is about to do must have that effect – not may, but must. We are more familiar with them in the cases of interference with light where the proposed plans shew that the building will be such that it must obscure the light. There was a very curious discussion on that subject before Lord Cottenham in Haines v. Taylor (1), where it was sought to prevent the erection of gasworks, on the ground that when erected they would be a nuisance. The Plaintiffs were in this position – that if they had stood by unduly without notice, they might have been barred under the doctrine of acquiescence, by reason of having allowed such a large expenditure; but the answer was, “We are going to erect a building to be used as a gasworks; we say we have an invention to prevent a nuisance; you think we have not, but it may turn out that something may be invented before we begin making gas that may prevent a nuisance. Is it the absolutely necessary consequence of our erecting gasworks that we shall cause a nuisance?” Why should it be predicted as an absolutely necessary consequence that the use of a similar name is a fact which, per se, will be calculated to deceive, and that the new company will carry on business in such a way as to unfairly interfere with the Plaintiffs’ business? I mention this because I think that it is only a fair warning to the Defendants that if they do they will be liable to an action, and to have an injunction granted against them.
Now, the only other point which I wish to advert to is the excuse which Mr. Chitty had for going on with his case after this point was taken and pointed out. He asked me for leave to amend his notice of motion, and to let the motion stand over. I cannot accede to that. There is no Judge more liberal, if I may use the expression, in allowing, amendments, in order to try the real case, than I am, at any stage of the case; but I make one exception, that is as to charges of fraud. I do not, as a rule, allow amendments to make a charge of fraud at a time when the case is launched, independently of fraud. I generally stop there. To allow such an amendment as this would be to contravene that rule. Of course, like all my rules, it is not an absolute rule. I may make an exception to it if I see good ground for doing so, but generally it is my rule. Here is a plaintiff coming in under an Act of Parliament who says: “You shall not use a name so similar to mine as to be calculated to deceive.” He asks me, having failed because his company was not registered, to change the whole complexion of the suit, and to turn it into a suit to charge the Defendants with the intention of adopting the name and carrying on the business with the view of defrauding the Plaintiff company by unfairly, illegally, and immorally appropriating a portion of the business of the Plaintiff company. Now I cannot allow any such case to be made. Any such case must be made by separate action and by separate notice of motion, and therefore I decline to accede to Mr. Chitty’s request. The only order I make is that there be no order except that the costs be costs in the action.
(1) 2 Ph. 210.
The Plaintiffs appealed. The appeal was heard on the 29th of March.
Pending the appeal the Appellants put in further affidavits by eminent actuaries and accountants, stating that in their opinion the similarity of the two names must necessarily result in deceiving the public, and leading them by mistake to pay premiums to the proposed new company, such premiums being intended for the “Universal” office, whereby serious errors and great loss would result to the latter office.
Chitty, Q.C., and H. W. Horne, for the Appellants:-
The Master of the Rolls was under a misapprehension in thinking that our motion was founded on the 20th section of the Companies Act, 1862. That is not the case. We only referred to the section as a statutory embodiment of the law on the subject. If we were applying under the Act, it would not be necessary to come to this Court, as the Registrar would take care of us.
This is not a case of two men having the same name setting up the same business, but it is the taking of an invented name so similar to our name as to be calculated to deceive, and with the intention of carrying on a similar business. It is within the principle of Croft v. Dy (1). There is no explanation on their affidavits why they came to take a name so like ours. It is an act which is calculated to lead to deception, and we are not bound to shew that it must necessarily deceive. Even if the name was taken at the first without any fraudulent intent, yet if they persist in using it after notice that it is calculated to deceive, that is evidence of fraudulent intent: Orr Ewing and Co. v. Johnston and Co. (1). Our affidavits shew that injury would result to us if this company is incorporated in this name: Pattisson v. Gilford (2).
(1) 7 Beav. 84.
[JAMES, L.J.:- Suppose they did not take any business from you, but were wound up within a year: would that be calculated to injure you?]
We submit it would. We were founded in 1834, and have built up a great name and reputation. Hoby v. Grosvenor Library Company (3) is on all fours with this case.
[They also cited Braham v. Beachim (4); Boulnois v. Peake (5); Seixo v. Provezende (6).] Roxburgh, Q.C., and Bond Coxe, for the Respondents:-
There is no jurisdiction to prevent a man from registering a company with any name he pleases under the Companies Act, with a view to trade. It is for the Registrar to object, if he thinks fit. Until the company is registered and is doing business, who is injured? We submit that the Court cannot go solely upon the opinion of experts, but must be satisfied that the necessary result of what is intended to be done must be that the public will be deceived. But how can the Court come to that conclusion until some overt act is done? We are not trading, and we say that we intend so to carry on our business as not to interfere with the Plaintiffs. The application therefore is premature. In all the cases cited business was being carried on. Further, there is no such similarity between the two names as will lead to injury, and the Plaintiffs cannot claim a right to the exclusive use of the word “Universe”: Lee v. Haley (7). This case is similar to those of the Colonial Life Assurance Company v. Home and Colonial Assurance Company (8); London Assurance v. London and Westminster Assurance Corporation (1); London and Provincial Law Assurance Society v. London and Provincial Joint Stock Life Assurance Company (2), in which an injunction was refused.
(1) 13 Ch. D. 434.
(2) Law Rep. 18 Eq. 259, 264.
(3) 28 W. R. 386.
(4) 7 Ch. D. 848.
(5) 13 Ch. D. 513, n.
(6) Law Rep. 1 Ch. 192.
(7) Ibid. 5 Ch. 155.
(8) 33 Beav. 548.
JAMES, L.J.:-
I am unable to agree with the view that the Master of the Rolls has taken in this case. No doubt the application is an application quia timet, that is to say, it is to prevent something which Lord Justice Cotton referred to, in the language of our old pleadings, as being threatened and intended – to prevent something which the Defendant is threatening and intending to do. Now it appears to me that it is made out beyond all possibility of doubt and beyond all possibility of argument, I think substantially, that the Defendant company is threatening and intending as soon as it is registered to transact all the ordinary descriptions of life assurance business, the head office being in London under the name and style of the Universe Life Assurance Association, Limited. That is clearly what it intends and threatens to do, unless it is restrained by injunction, and with the view of doing this, and as the first step in doing it, it threatens and intends to get itself registered upon the Joint Stock Companies Register under that name. The Plaintiffs’ name is the Universal Life Assurance Society. Now, is there such a similarity between those names as that the one is in the ordinary course of human affairs likely to be confounded with the other? Are persons likely who have heard of the Universal to be misled into going to the Universe? I should think, speaking for myself, very likely indeed. Many people do not care to bear in mind exactly the very letters of everything they have heard of, and we have had a great body of evidence before us of persons, whose business it is to be acquainted with these life assurance companies, all of whom concur in deposing in the strongest possible terms that nothing is more calculated to injure an old society of this kind than having a new society established which has got a name so similar to that of the other as that it is likely to be mistaken for it. They say that likelihood exists in this case: that it is likely, morally certain, in fact, that there will follow the results which they describe. Well, that being so, it seems to me we have everything that is required according to the principles of the Court – all the Court requires is to be satisfied that the names are so similar as to be calculated to produce confusion between the two companies – so calculated to do it that when it is drawn to the attention of those adopting the name complained of that that would be the result, it is not honest for them to persevere in their intention, though originally the intention might not have been otherwise than honest. I think, therefore, these Defendants ought not to be permitted to persevere in their intention, now that they know exactly what it is the Plaintiffs complain, and reasonably complain of; that they ought not to be permitted to persevere in their intention of using that name merely because they say – and that is all they do say in their affidavits – that when they formed the intention of using the name Universe in the first instance they had not any idea of stealing the Plaintiffs’ name. We may give them credit for that, but when their attention was called to it they ought to have acted immediately upon that notice instead of disregarding it and continuing to use the name. It is said that this is a premature application, but that might be said in every case of quia timet where persons always do come to the Court before the mischief is done, and if these Plaintiffs had waited until the Defendant company had actually been registered and had begun its business I know perfectly well the answer to their application would have been: “You are too late; you allowed us to form the company; you allowed the company to be floated and advertised; you allowed us to incur all the expense of that, and now you come down upon us and try to stop us carrying on the business which you knew perfectly well we were going to carry on and had incurred all this expense for.” Of course, defendants in these cases always do say “you are too early” in one case, and “you are too late” in the other, but plaintiffs are never too early when the Court is satisfied that the thing which the plaintiff dreads is really and substantially threatened to be done, as in this case. Then it is said that the Court has no right to restrain them from registering the company under this name; that there is a statutory right in any of Her Majesty’s subjects to form a joint stock company, and to register themselves in any name they think fit. So far as the Registrar is concerned they have a right possibly to go to him and say, “Register this company subject to the statutory provision as to similarity of name with that of any other registered company;” but that has nothing to do with the jurisdiction of the High Court to say, “Yes, but you must not do mischief to anybody else.” Supposing they had registered in the very name of an existing company, they might say, “We were entitled to do that because we have not registered for the purpose of carrying on the same business, although we have registered in your very name.” Then the same thing must apply conversely, and if the new name is so like the other name as to be calculated to deceive, the Court will say they ought not to be allowed to carry on a similar business, and will restrain them from doing so. I am of opinion, therefore, that the order ought to be not that of the Master of the Rolls, but to restrain the Defendant company in the terms of the application.
(1) 32 L. J. (Ch.) 664.
(2) 17 L. J. (Ch.) 37.
BRETT, L.J.:-
I also differ from the result at which the Master of the Rolls has arrived; but I hardly think we are differing from him at all as to the law of this matter? and I doubt very much whether we are acting upon the same evidence, or upon evidence which when the case was before him was quite equivalent to that which is now before us. It seems to me clear that the Defendants were intending to carry on under the name of the Universe Life Assurance Association, Limited, the ordinary business of life insurance, that they were intending to carry on that business in the ordinary way, which is the same way, therefore, as the Plaintiffs carry on that business, and that they were intending to carry on that business in London. It seems to me those are all the intentions on the part of the Defendants which I should upon the facts be inclined to find. I should certainly decline, if my judgment depended upon such a finding, to find that either the Defendants or Mr. Alexander had any intention of committing any fraud whatever. I should even decline myself to find that after they knew of the name of the other company, and although they still intended to carry on their own company in the name which they had proposed to adopt, that they even then intended to do anything which is really fraudulent. I have often said I cannot bring my mind to say that, sitting as a Judge, or in any other capacity, I will ever find a man to be guilty of an intent to be fraudulent unless I am of opinion that he really has a fraudulent mind. If, therefore, this judgment were to depend upon any idea of that kind, of supposing that there was an intentional fraud, either present or future, I should venture to resist; but it seems to me it is not at all necessary, according to the authorities and according to the doctrines of the Court, to suppose there was any intention of fraud existing, or that there would be any in the future. The question is simply whether the name they have adopted for a business of the same kind and in the same city is so like the name of the Plaintiffs, which they have used as their trade name for so long a period, as in fact to enable the Defendants to appropriate, or to result in the Defendants in fact appropriating, a material part of the business of the Plaintiffs’ company, by misleading people to suppose that they were dealing with the Plaintiffs when, in fact, they were dealing with the Defendants. The question is whether we can come to the conclusion that that will be, in fact, the effect of their using the name which they propose to use, and that must depend, in the first place, not upon whether the names are identical, but upon whether they are so alike that we are of opinion that in truth and in fact it would have that effect.
I do not think that judicially we could decide that as a matter of law. It is a question of fact whether the name is so similar to the other that it would lead to that result in business. It is not a question of law at all, but of fact upon the evidence. We have the evidence before us, and we are here to judge of the effect of that evidence. If the names were identical, I do not say whether one might or not come to a conclusion without any more evidence, but as it is, I think that evidence was admissible and was necessary. Before the Master of the Rolls, it seems to me, that the evidence was rather feeble; there was some evidence before him, but it was feeble; but since then further affidavits by a number of experienced people have been filed. I will call them people experienced in this kind of business, and they have all deposed that the similarity of these two business names is so great that the use of this new name would have the effect of misleading people into supposing, when they were in truth dealing with the Defendants, that they were dealing with the Plaintiffs, – of inducing them to deal with the Defendants, although their desire and wish was to have dealt with the Plaintiffs on account of the character which had been acquired by their name. That evidence was put in upon affidavits filed, and was called to the Defendants’ attention a long time ago, but from reasons of their own they have wholly abstained from answering it. That evidence seems to me to be satisfactory evidence of the fact, and therefore I think we ought to come to the conclusion, as I do as a matter of fact, that the similarity of the names would in truth have that effect. That seems to me all that it is necessary to decide. It is possible, no doubt, as a matter of possibility, that it would not, but that is not the case here upon the evidence; the question is whether we are of opinion, sitting as a tribunal judging of the fact, that it will – not whether it is possible it might not, but whether in truth it will; and that, to my mind, is made out. Then it is said this is an application for an injunction quia timet, and that it ought not to have been made under the Act, and that the Master of the Rolls so held. But that does not seem to me to have been the ruling of the Master of the Rolls. He seems to have thought the application might have been made quia timet, but that the evidence before him was not sufficient. The case before Vice-Chancellor Hall seems to me to be precisely in point. With regard to the other proposition, that we could not restrain these parties from applying to be registered, it seems to me that the application to be registered is a step in carrying into effect the intention and a part of the injury, and that therefore this Court can prevent the Defendants, and enjoin them from making that application. The whole application, therefore, for an injunction in this case ought to be granted.
COTTON, L.J.:-
The first point urged by the Respondents here was in the form of a preliminary objection, and though we did not so regard it, the Master of the Rolls seems to have thought it fatal to the application. That objection was that the application was under the 20th section of the Companies Act, 1862, and that it could not therefore be made, the company not being registered.
It is an application for an injunction made in an action brought to enforce a well-known equity, viz., to prevent the Defendants from doing that which is calculated to mislead the public and lead them to think that the Defendant company is the company of the Plaintiffs. The question is whether that is made out. But before I deal with that, I will deal with another objection which has been considerably pressed, viz., that this action was premature. The company, it is said, does not exist and does not carry on business; and that it is premature to apply for an injunction when you do not know how the company will carry on its business. But the principles of the Court are opposed to that argument. No doubt the Court must be satisfied on the evidence that injury will result from the acts which the Defendant threatens and intends to do, to adopt the technical language of the old pleadings in bills of complaint, which Mr. Roxburgh rather objected to my using. If the Court is satisfied that the Defendants intend to do acts which, as far as all reasonable probability goes, will interfere with the rights which the Plaintiffs have, then, in my opinion, it was the old established practice of the Court of Equity, and is the duty of the Court now, not to wait until injury is done, when a Court of Law would have granted damages, but to interfere by way of prevention and stop that from being done which, if done, would be an injury to the Plaintiffs. There was mixed up with this argument this question: It was said, how can you tell that the company will carry on its business in such a way as to cause any injury? The Master of the Rolls, in his judgment, has referred to a case where there was an application made to stop a gasworks from being erected. There the question depended upon this, whether there would be a nuisance arising from the manufacture of the gas, and, according to the defendant’s case, the gas would be manufactured by a process which would prevent any nuisance whatever, so that it depended there upon the gas being manufactured in such a way as to prevent injury. But this is not like a case where the Court is asked to interfere in the erection of a building of that description; it is asked here to restrain the Defendants from doing certain acts which, if done, will be an interference with the rights of the Plaintiffs. What is the result upon the evidence?
In my opinion the result is this: That what the Defendants will do, if they are not restrained, will cause confusion and will induce people, or be the means of inducing people, who desire to insure in this long-established society of the Plaintiffs’, to insure in the Defendants’ office instead. That, in my opinion, is the result of the evidence. It is said that possibly they may carry on their business in some other way; but what we have here is, that although this company is not registered and is not carrying on business, it has put forth to the world, to induce the public to join as shareholders, a prospectus in which it states how it intends to carry on its business. Are we, therefore, without any evidence to the contrary as to the mode in which they are going to carry on their business, to say that this application is premature? The result must be that the intention of the Defendants is to be deemed to be to carry on their business in the way their prospectus states that it is to be carried on, that there is a head office in London, with various agencies and branches in England and the Colonies; and that, in my opinion, coupled with the similarity of the name, is sufficient to lead to the conclusion that what they are going to do is calculated to deceive, and will deceive, the public to the prejudice of the Plaintiffs. But it is said, “Why should not they have their offices in a part of London distant from that where the Plaintiffs have their office?” If they had been selling butter or cheese, or some such article, it would have been material to consider in what part of London their office is to be; but when an insurance office starts by stating that it intends to carry on its business not only in London but throughout the United Kingdom, and in all parts of the world, and the Plaintiffs do the same, then I think it is very immaterial in what part of London they intend to establish their head office. This is a very different case, therefore, from that of the Guinea Coal Company, which has been referred to(1). I will say one word further as to the intent of the Defendants. In my opinion it is not necessary that in taking the name they have, there should have been any fraudulent intent; but whether there was a fraudulent intent or not, everybody is responsible for the reasonable consequences, upon facts known to him, of what he is doing. It is hardly possible to suppose that Mr. Alexander, if not the persons associated with him, did not know all the facts connected with the adoption of this name – Universe Life Assurance Association; and even if they did not, immediately after the first advertisement of the company appeared in the Times, an application was sent to the Defendants pointing out the consequences of what they were doing, and therefore, even if they had been unaware of it before, their attention was then called to the fact that those would be the consequences, and it was wrong on the part of the Defendants to persist afterwards in the use of the name which they had taken. There is only one other point, viz., whether the Plaintiffs are entitled to the whole of the injunction they ask. It is said there is a statutory right to register. Yes, there is a statutory right, provided the person who is doing it is not in doing it violating some other right, or offending against the law. If he is, this Court has the most perfect right to stop him from doing so, just as it had a right of stopping him from going to a Court of Law; though it has no right to prevent a Court of Law from entertaining his suit. Here one of the grounds for applying to this Court is that the Registrar, who registers on application the names of limited companies, could not, under the Act, have refused to register this company on the ground that the particular section of the Act only applies to similarity with the name of a company already registered. If, therefore, the Court is satisfied, as we are in this case, that what the Defendants intend to do will be a wrong to the Plaintiffs, the Court is entitled to prevent the very first step in the wrongful act being taken. The appeal must be allowed with costs.