Case: Toddler Kindy Gymbaroo Pty Ltd v Gymboree Pty Ltd [2000] FCA 618 ; (2000) 100 FCR 166
Outcome: considered
Subsequently, in Health World Ltd v Shui-Sun Australia Pty Ltd [2008] FCA 100 ; (2008) 75 IPR 478 Jacobson J at [203]-[205] observed: The power to order rectification under s 88 is expressed in discretionary terms. However, in EOS Australia Pty Ltd v Expo Tomei Pty Ltd (1998) 42 IPR 277 at 287, Branson J expressed the view that the terms of s 89 suggest that s 88(1) does not vest a true discretion in the court. In my opinion, there is force in Branson J's view because s 88(1) is subject to s 89, and s 89 confers a discretion, to be exercised in limited circumstances, not to grant an application for rectification. Nevertheless, this approach has not been taken in other courts: see, for example, Toddler Kindy Gymbaroo Pty Ltd v Gymbaree Pty Ltd (2000) 100 FCR 166 ; 51 IPR 1 ; [2000] FCA 618 at [97] ; Mayne Industries Pty Ltd v Advanced Engineering Group Pty Ltd (2008) 75 IPR 102 ; [2008] FCA 27 at [75] . Lahore observes at [57,155] that s 89 may be seen as codifying the case law on blameworthy conduct; accordingly, it deals with the circumstances in which a particular discretion may be exercised without detracting from the general discretion found in s 88(1). I propose to proceed on that basis. 49 Little guidance as to the proper application of s 88(1) can be obtained from Toddler Kindy Gymbaroo Pty Ltd v Gymboree Pty Ltd [2000] FCA 618 ; (2000) 100 FCR 166 as no party argued in that case that s 88(1) did not vest a true discretion in a prescribed court. In Mayne Industries Pty Limited v Advanced Engineering Group Pty Limited [2008] FCA 27 ; (2008) 75 IPR 102 at [75] Greenwood J said of s 87(1) of the Trade Marks Act: Section 87(1) confers a discretion on the court to order cancellation of the registration of the trade mark. That discretion is to be exercised according to its terms and, where appropriate, settled principle. The discretion is to be exercised subject to s 87(2) which identifies circumstances in which the court might decide not to make an order. Similarly, the court might by s 89 of the Act decide "not to grant an application under s 87" and therefore refuse to make an order which, is itself, an exercise of the discretion, if the registered owner satisfies the court that the ground relied on by the applicant "has not arisen through any act or fault of the registered owner". In terms, the discretion must not only be exercised taking account of ss 87(2) and 89 but having regard to the effect of s 25 on the right of the registered owner of the trade mark. It seems to me that all these matters must be weighed carefully in the balance to determine whether the court ought to cancel the registration of a trade mark and, in consequence, extinguish rights conferred by the Act on the registered owner. The discretion is a true discretion in the sense that all the matters going to s 25 (the circumstances of this case) must be considered, the particular circumstances of the applicant, any relevant s 87(2) factors, the conduct of the registered owner and the effect upon the rights of the registered owner brought about by the operation of s 25. Some of these factors will weigh heavily as s 25, for example, has the applied effect of declaring that the registered owner has no exclusive rights. In that sense, the discretion may seem facultative only: EOS (Aust) Pty Ltd v Expo Tomei Pty Ltd (1998) 42 IPR 277 , per Branson J. However, the court is required to determine whether an order ought to be made or refused taking account of the identified considerations.