Company names tribunal orders name change under CA s.73
Adecision of the Company Names Tribunal in April 2010 highlights that care should be taken to avoid choosing a company name which could affect the goodwill of another party's existing business.???
MBI applied to the tribunal for an order under s 73 CA 2006 requiring Hi-Rope Limited to change its name and for payment of its reasonable costs in connection with the application.
MBI stated as follows to the tribunal:
- MBI had run a successful rope access business under the name "Hi-Rope" for a number of years;
the trade mark "Hi-Rope" is registered in MBI's name;
- the incorporation of Hi-Rope Limited was opportunistic because it occurred two months after MBI's sister company with this name was dissolved; and
- even if not opportunistic, the use of the name could cause it damage, including the possibility of harming MBI's "impeccable safety record and quality standards" in particular.
Hi-Rope Limited responded:
- the company had been incorporated to provide walking holidays and would not trade in competition with MBI nor seek to take advantage of MBI's goodwill;
- the name of the company had been chosen in good faith (itself a defence under section 69(4)(d) of the Act) and was merely coincidental;
- a tourism business of this kind would not infringe MBI's trade mark; and
- the defence under section 69(4)(e) of the Act, namely that "the interests of the applicant are not adversely affected to any significant extent", should also be available to it, as the business areas were different and MBI had since re-branded its rope access business.
The tribunal accepted MBI's arguments in prefeence to?Hi-Rope's. In particular, it reasoned that any health and safety failure on the part of Hi-Rope Limited could "readily damage the reputation" of MBI because of the importance of MBI's safety record to its business, and that customers and potential customers would be likely to make the link to MBI even though it no longer used the name.
As well as an order requiring Hi-Rope Limited to change its name within one month, the tribunal awarded MBI costs of ?1,350.
Case: MB Inspection Limited v Hi-Rope Limited