Tuesday, 24 March 2015

SONY case: Kenya Court of Appeal decision clarifies discretion of Registry

One of the latest developments in Kenya is news of a really strange case to have made its all the way to the Court of Appeal in Nairobi. Attracting the attention of a three judge bench to appeal against a High Court review of a Registry decision to allow an extension of time in an opposition, local company Sony Holdings sought to avoid an opposition against their trade mark applications including the word SONY by arguing the Registry acted ultra vires (outside its powers) in granting an extension of time to the opponent. Meanwhile, patiently waiting for their chance to argue the merits of the opposition is, you guessed it, Sony Corporation, owners of the reputable SONY mark.

Despite the oddity of pursuing a technicality under circumstances which seem impossible to have succeeded, the decision has brought some welcome insight into the degree of thoroughness of the Court of Appeal as well as providing clarity on the discretion of the Registry and extension of time proceedings in Kenya. You can read the full decision here.

The High Court had dismissed the review on the basis that:

1.      The allegation of excess jurisdiction could only be challenged by review proceedings;
2.      There was no legitimate expectation of a mark proceeding to registration once it had been advertised, more so if there has been notification of a third party owning similar marks;
3.      That the Registrar has wide powers to extend time periods under the Trade Marks Act and can provide as many as they like, provided they do not exceed 90 days at a time; and
4.      The Registry had exercised their discretion within the bounds of the law in allowing the extension of time.

The appeal was lodged on 14 different grounds argued in 3 clusters that:

1.      The Registry has now power to grant extensions of time following the lapse of 60 days after the period for commencing opposition proceedings;
2.      The Registry violated the Applicant’s right to a fair administrative action and legitimate expectation; and
3.      The Registry violated the Applicant’s right to a fair administrative action and freedom from discrimination.

The appeal court concluded that the single broad issue was whether the Registry had the discretion to extend time periods under Section 21(2) the Trade Marks Act read with Rules 46 and 102 of the Trade Marks Rules.

It is settled law in Kenya that a higher court can only interfere with the discretion exercised by a lower court if the decision maker misdirected his interpretation of the law, misapprehended the facts, took into account matters which he should not have, and ignored relevant ones as a result of which an incorrect decision was made. In other words that one of the 3”I”s was present - illegality, irrationality or impropriety.  The court then dissected the relevant Section and Rules within the context of interpretation jurisprudence (local and from Australia) in coming to the conclusion that:

  1. Notices of opposition should be lodged within 60 days of the date of advertisement;
  2. The Registry has unfettered powers to extend the period beyond that, even beyond 90 days, for good reason.
The Judges then considered the purpose of trade mark law which is to “avoid unfair competition”, the public interest and the nature of the case, that the delay was not prejudicial and not necessarily, unreasonable. Also, that the appellant could not have suffered an adverse expectation because they were at all times aware that extensions were being granted. They also considered the law of review as it is applied in Kenya and concluded that like the High Court, the Registry had acted judicially and fairly.

Hence the appeal had no merit and was dismissed with costs.

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