Guy Neale v Ku De Ta: Trade Mark Infringement, Exclusive Licence, and Beneficial Ownership Dispute

In Guy Neale and others v Ku De Ta SG Pte Ltd, the Singapore Court of Appeal addressed a dispute between the operators of 'Ku De Ta Bali' and 'Ku De Ta Singapore' concerning the use of the 'Ku De Ta' name. The Appellants, members of a partnership owning Ku De Ta Bali, sought to restrain the Respondent, Ku De Ta SG Pte Ltd, from using the name in Singapore. The Respondent claimed rights through an exclusive licence granted by Nine Squares Pty Ltd, the legal owner of the Singapore trade marks, but allegedly in breach of trust to the Partnership. The court considered whether the exclusive licence conferred a proprietary interest and whether it bound the Partnership, ultimately allowing the appeal and finding the licence did not bind the Partnership.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeal Allowed

1.3 Case Type

Intellectual Property

1.4 Judgment Type

Written Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore Court of Appeal case concerning trade mark infringement, the nature of an exclusive licence, and the rights of a beneficial owner. Appeal allowed.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Guy NealeAppellantIndividualAppeal AllowedWon
Ku De Ta SG Pte LtdRespondentCorporationAppeal DismissedLost

3. Judges

Judge NameTitleDelivered Judgment
Sundaresh MenonChief JusticeYes
Chao Hick TinJustice of the Court of AppealNo
Andrew Phang Boon LeongJustice of the Court of AppealNo

4. Counsels

Counsel NameOrganization
Ang Cheng HockAllen & Gledhill LLP
William OngAllen & Gledhill LLP
Kristy TanAllen & Gledhill LLP
Clara TungAllen & Gledhill LLP
Low Chai ChongRodyk & Davidson LLP
Foo Maw JiunRodyk & Davidson LLP
Vernon ChuaRodyk & Davidson LLP
Gilbert LeongRodyk & Davidson LLP

4. Facts

  1. The Appellants are members of a partnership that owns and operates Ku De Ta Bali.
  2. The Respondent operates Ku De Ta Singapore at Marina Bay Sands.
  3. Nine Squares Pty Ltd held the Singapore Marks on trust for the Partnership.
  4. Ellaway, a director of Nine Squares, entered into a Licence Agreement with Au without Chondros' knowledge.
  5. Au assigned his rights under the Licence Agreement to the Respondent.
  6. Au was informed that the KDT brand IP belonged to the Ku De Ta Bali owners and not Nine Squares.
  7. Chondros stated in an affidavit that he never intended for Nine Squares to be the beneficial owner of the Ku De Ta trade marks.

5. Formal Citations

  1. Guy Neale and others v Ku De Ta SG Pte Ltd, Civil Appeal No 171 of 2013, [2015] SGCA 28

6. Timeline

DateEvent
Heads of Agreement entered into by Guy Neale, Aki Kotzamichalis, Made Wiranatha and Arthur Chondros
Trade mark for the “Ku De Ta” name registered in Indonesia
The “Ku De Ta” name registered as a trade mark in Australia
Nine Squares incorporated in Victoria, Australia
Chondros and Ellaway assigned the Australian Mark to Nine Squares
Nine Squares applied for an international registration of the “Ku De Ta” name as a trade mark
Partnership meeting held regarding beneficial ownership of Overseas Marks
Chondros emailed Ellaway insisting that Ellaway should not enter into any agreements without Chondros’ express written consent
Nine Squares entered into the Licence Agreement with Au
Nine Squares applied to register the “Ku De Ta” name as a trade mark in Classes 9 and 25
Ku De Ta SG Pte Ltd incorporated in Singapore
Au received an email informing him that the KDT brand IP belonged to the Ku De Ta Bali owners and not Nine Squares
Au met Chondros to persuade him to enter into a licensing arrangement
Au met Chondros to persuade him to enter into a licensing arrangement
Au assigned his rights under the Licence Agreement to the Respondent
The Respondent entered into a lease with MBS to take space for Ku De Ta Singapore
Chondros learnt of the existence of the Licence Agreement
The Respondent and Au commenced legal proceedings in Victoria, Australia against Nine Squares
Chondros filed an affidavit stating that the Overseas Marks were held on trust for the Partnership
The Australian Proceedings were settled
Ku De Ta Singapore opened
The Appellants commenced Suit 955 against the Respondent
Suit 314 against Nine Squares was filed
Suit 314 and Suit 955 were dismissed by the Judge
The Appellants’ appeal in CA 172 was allowed
Judgment reserved
Decision Date

7. Legal Issues

  1. Trade Mark Infringement
    • Outcome: The Court found that the Respondent's continued use of the 'Ku De Ta' name constituted clear infringement of the 1st Singapore Mark.
    • Category: Substantive
    • Sub-Issues:
      • Use of identical mark for identical services
      • Likelihood of confusion
  2. Validity of Exclusive Licence
    • Outcome: The Court held that the exclusive licence was contractual in nature and did not bind the Partnership, as the Respondent had constructive notice of the Partnership's beneficial interest.
    • Category: Substantive
    • Sub-Issues:
      • Proprietary nature of exclusive licence
      • Authority of agent to grant licence
      • Notice of beneficial ownership
  3. Beneficial Ownership of Trade Mark
    • Outcome: The Court upheld the Partnership's equitable interest in the trade mark, finding that the Respondent's interest was acquired with constructive notice of the Partnership's beneficial interest.
    • Category: Substantive
    • Sub-Issues:
      • Enforcement of unregistered trust
      • Competing equities
  4. Passing Off
    • Outcome: The Court declined to consider the passing off claim due to the Appellants' lack of goodwill in Singapore, adhering to the 'hard-line' approach.
    • Category: Substantive
    • Sub-Issues:
      • Goodwill in Singapore
      • Misrepresentation
      • Damage
  5. Authority of Agent
    • Outcome: The Court found that Ellaway did not have actual, usual, or apparent authority to conclude the Licence Agreement.
    • Category: Substantive
    • Sub-Issues:
      • Actual Authority
      • Apparent Authority

8. Remedies Sought

  1. Injunction
  2. Damages
  3. Account of Profits

9. Cause of Actions

  • Trade Mark Infringement
  • Passing Off

10. Practice Areas

  • Intellectual Property Litigation
  • Commercial Litigation

11. Industries

  • Hospitality
  • Food and Beverage
  • Entertainment

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Guy Neale and others v Nine Squares Pty LtdHigh CourtYes[2013] SGHC 249SingaporeProcedural history of the case; dismissed Suit 314, which led to the dismissal of Suit 955.
Guy Neale and others v Ku de Ta SG Pte LtdHigh CourtYes[2013] SGHC 250SingaporeProcedural history of the case; dismissed Suit 955 because Suit 314 was dismissed.
Guy Neale and others v Nine Squares Pty LtdCourt of AppealYes[2015] 1 SLR 1097SingaporeEstablished that Nine Squares held the Singapore Marks on trust for the Partnership, which is crucial to the current appeal.
OMG Holdings Pte Ltd v Pos Ad Sdn BhdCourt of AppealYes[2012] 4 SLR 231SingaporeAcknowledges that there has been no authoritative pronouncement on whether a licence of a trade mark is proprietary in nature in Singapore.
Northern & Shell plc v Condé Nast & National Magazine Distributors Limited and anotherEnglish High CourtYes[1995] RPC 117EnglandLeading case in England that a licence to exploit a registered trade mark is purely contractual in nature and does not confer any proprietary rights on the licensee.
CBS United Kingdom Ltd v Charmdale Record Distributors LtdEnglish High CourtYes[1981] 1 Ch 91EnglandCited for the principle that licences of copyright do not confer on the licensee any proprietary interest.
Allen & Hanburys Limited v Generics (UK) Limited and othersHouse of LordsYes[1986] RPC 203EnglandCited for the principle that licences of patents do not confer on the licensee any proprietary interest.
Crittall Windows Limited v Stormseal (UPVC) Window Systems Limited and anotherEnglish High CourtYes[1991] RPC 265EnglandCited for the principle that the doctrine of forfeiture did not apply to intellectual property licences because such licences do not confer proprietary or possessory rights in rem.
Leofelis SA and another v Lonsdale Sports Ltd and othersEnglish Court of AppealYes[2008] ETMR 63EnglandReiterates the principle that a trade mark licence gives no proprietary interest and does no more than make lawful some use of the trade mark that would otherwise be unlawful.
VLM Holdings Limited v Ravensworth Digital Services LimitedEnglish High CourtYes[2014] FSR 9EnglandConfirms that a licence does not create a lower proprietary right carved out of a superior proprietary right in the same manner as a sub-lease is carved out of a head lease.
Ultraframe (UK) Ltd v Fielding and others (No 2)English High CourtYes[2006] FSR 17EnglandHeld that an exclusive licence of a design right is non-proprietary in nature.
Dendron GmbH and others v The Regents of the University of California and another (No 3)English High CourtYes[2004] FSR 43EnglandCited in support of the principle that an exclusive licence of a design right is non-proprietary in nature.
Sport International Bussum BV and others v Inter-Footwear LtdEnglish High CourtYes[1984] 1 WLR 776EnglandCited in support of the principle that an exclusive licence of a design right is non-proprietary in nature.
T Eaton Co, ReOntario Superior Court of JusticeYes14 CBR (4th) 288 (Ont SC)CanadaEven exclusive licences are not proprietary in nature.
Southern Pacific Mortgages Ltd v Scott (Mortgage Business plc intervening)UK Supreme CourtYes[2015] AC 385EnglandPersonal rights cannot displace the proprietary interests of a third party.
SPP Ltd v Chew Beng Gim and anotherCourt of AppealYes[1993] 3 SLR(R) 17SingaporeA managing director who was allowed to run a company on his own was found to have been impliedly authorised to permit or approve the execution of certain guarantees.
Hely-Hutchinson v Brayhead Ltd and anotherEnglish Court of AppealYes[1968] 1 QB 549EnglandDiscusses the authority of a de facto managing director.
Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd and another and another appealCourt of AppealYes[2011] 3 SLR 540SingaporeAn agent who has no authority, whether actual or ostensible, to perform a certain act cannot confer upon himself authority to do that act by representing that he has such authority.
Freeman & Lockyer (a firm) v Buckhurst Park Properties (Mangal) Ltd and anotherEnglish Court of AppealYes[1964] 2 QB 480EnglandExplains the nature of apparent authority.
Magical Marking Ltd v HollyCopyright TribunalYes[2009] ECC 10EnglandIf you have a doubt about representations that have been made to you and that doubt is not objectively and reasonably quelled by the circumstances, you do not ask the representor or his agents to quell the doubt.
Ashburn Anstalt v Arnold and anotherEnglish Court of AppealYes[1989] 1 Ch 1EnglandA court of equity will not permit such a purchaser to deny the licensee his rights if his conscience had been so affected that it would be inequitable to allow him to do so and a constructive trust will be imposed to uphold the rights of the licensee.
Ennis v Lovell (The Swinging Blue Jeans Trade Mark)UK Intellectual Property OfficeYes[2014] RPC 32EnglandIf it is proven that a trade mark registration is held on trust for a claimant, such a claimant would be entitled to call for the title to the registration to be vested in him.
Hotel Cipriani Srl and others v Cipriani (Grosvenor Street) Ltd and othersEnglish Court of AppealYes[2010] Bus LR 1465EnglandDiscusses s 56 of the UK 1994 Act, which only arises in situations such as the present, if the registration of the relevant trade mark is lost in some way.
Staywell Hospitality Group Pty Ltd v Starwood Hotels & Resorts Worldwide, Inc and another and another appealCourt of AppealYes[2014] 1 SLR 911SingaporeReiterates the 'hard-line' approach to goodwill in Singapore, meaning that a foreign trader who does not conduct any business activity in Singapore will generally not be able to maintain an action in passing off here.
Star Industrial Co Ltd v Yap Kwee KorCourt of AppealYes[1974-1976] SLR(R) 581SingaporeEstablished the 'hard-line' approach to goodwill in Singapore.
Starbucks (HK) Limited and another v British Sky Broadcasting Group PLC and othersUK Supreme CourtYes[2015] UKSC 31EnglandReaffirmed the 'hard-line' position on goodwill in England.
SAL Industrial Leasing Ltd v Hydtrolmech Automation Services Pte Ltd and othersHigh CourtYes[1997] 3 SLR(R) 676SingaporeThe general principle of company law is that directors act collectively, unless specifically authorised to act individually.
Falmac Limited v Cheng Ji Lai CharlieHigh CourtYes[2013] SGHC 113SingaporeThe general principle of company law is that directors act collectively, unless specifically authorised to act individually.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Trade Marks Act (Cap 332, 2005 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Exclusive Licence
  • Beneficial Ownership
  • Trade Mark
  • Passing Off
  • Apparent Authority
  • Constructive Notice
  • Equity's Darling
  • Goodwill
  • Singapore Marks
  • Licence Agreement
  • Deed of Settlement

15.2 Keywords

  • trade mark infringement
  • exclusive licence
  • beneficial ownership
  • passing off
  • Nine Squares
  • Ku De Ta
  • Singapore
  • intellectual property
  • trust
  • agency

17. Areas of Law

Area NameRelevance Score
Trademarks75
Contract Law60
Trust Law50
Estoppel40
Passing Off30
Corporate Law30
Fiduciary Duties20
Breach of Contract20
Corporate Litigation10

16. Subjects

  • Trade Mark Law
  • Intellectual Property
  • Licensing
  • Trusts
  • Agency