Wednesday, 23 April 2008

Namibia: ASCO passing off appeal decision

In Gonschorek and Others v Asmus and Another (SA 11/2007) [2008] NASC 3 (15 April 2008), the Namibia Supreme Court last week dismissed an appeal by GUIDO-DIRK GONSCHOREK, PATRICK MARIA GEYSEN, ASCO CAR SALES CC and ASCO WORKSHOP CC (Guido) against an interdict/injunction for passing off in favour of ARNDT ASMUS and CONSTANZE ASMUS (Asmus). The case arose out of a business sale by Asmus of part of the ASCO branded business (car hire, panel beating, properties and yacht chartering) to Guido. The agreement of sale provided that the goodwill of the business, Asco Car Hire, would specifically include the name Asco Car Hire. In regard to the other businesses Asmus pointed out that they were not sold as going concerns and that the sale of the assets did also not include the names of the businesses. Towards the end of 2004 Asmus became aware that Guido was conducting business under the name and style of Asco Car Sales and Asco Workshop which were then, subsequently, registered as close corporations (ie small companies).

Asmus sued on the basis of passing off and under the Close Corporation Act 26 of 1988 and was successful. This appeal was then lodged. In dismissing the appeal the Judge considered the content of S20(2) of the Close Corporations Act and the meaning of an "undesirable name" and "calculated to cause damage", as well as the principles of passing off when applied to the sale of part of a business (including a name) and the subsequent use of that name by the purchaser for other businesses. A more comprehensive note on this case will follow at a later date.

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