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PUBLISHED FOR THE PROPRIETORS AT THE OFFICE OF

THE LAW JOURNAL REPORTS, 119 CHANCERY LANE, LONDON. 1904.

94292

TETVVD ZIVILOKD'YWOK

DECISIONS

OF THE

JUDICIAL COMMITTEE OF

HIS MAJESTY'S PRIVY COUNCIL

AND OF THE

HOUSE OF LORDS

IN SCOTCH AND IRISH APPEALS.

1903.

July 21, 29. Nov. 4.

GRAND HOTEL Co. of CALEDONIA SPRINGS, LIM. v. WILSON AND OTHERS.*

Trade Name Name of Locality Natural Product.

Where goods are not manufactured, but are the natural product of a particular locality, the name of which necessarily forms part of any real description of the goods, the first user has no exclusive right to call his goods by the name of the place.

Montgomery v. Thompson (60 L. J. Ch. 757; [1891] A.C. 217) distinguished.

The appellants were the owners of land on which there were natural springs, the water of which they sold for table and medicinal purposes. The respondents acquired adjacent land, from which by borings and pipes they obtained similar water-Held, that the respondents were entitled to use the name of the place as part of the description of the water which they sold.

Appeal from a decision of the Court of Appeal for Ontario.

The facts are fully stated in the judgment.

Arnoldi, K.C. (of the Colonial Bar), for the appellants.

* Coram, Lord Davey, Lord Robertson, and Sir Arthur Wilson.

VOL. 73.-P.C.

Scrutton, K.C., and R. C. Smith (of the Colonial Bar), for the respondents.

4

The arguments were similar to those which are always advanced in trade-name cases; and, in addition to the authorities referred to in the judgment, the following were cited: Seixo v. Provezende [1865], Radde v. Norman [1872],2 Reddaway v. Banham [18961,3 Massam v. Thorley's Cattle Food Co. [1880], Birmingham Vinegar Co. v. Powell [1897],5 Braham v. Beauchamp [1878], Cellular Clothing Co. v. Maxton & Murray [1899], Whitstable Oyster Fishery Co. v. Hayling Fisheries [1901], Canal Co. v. Clark [1871], Montgomerie v. Donald & Co. [1884],10 and M'Andrew v. Bassett [1864].11

LORD DAVEY delivered the judgment of their Lordships:

The appellants are the proprietors of certain lands in the township of Caledonia, Prescott county, Ontario. There are on this land three natural springs of mineral waters containing chemical properties (1) L. R. 1 Ch. 192.

(2) 41 L. J. Ch. 525; L. R. 14 Eq. 348.
(3) 65 L. J. Q.B. 381; [1896] A.C. 199.
(4) 14 Ch. D. 748.

(5) 66 L. J. Ch. 763; [1897] A.C. 710.
(6) 47 L. J. Ch. 348; 7 Ch. D. 848.
(7) 68 L. J. P.C. 72; [1899] A.C. 326.
(8) 18 Rep. Pat. Cas. 434.

(9) 13 Wallace, U.S. Sup. Ct. 311.
(10) 11 Rettie, 506.

(11) 33 L. J. Ch. 561; 4 De G. J. & S.380.

B

GRAND HOTEL CO. OF CALEDONIA SPRINGS, LIM. v. WILSON. which render them serviceable as table waters and for medicinal purposes. The springs are in close proximity to each other, but differ widely in their character. One of these springs is known as the Gas Spring, from the quantity of carburetted hydrogen gas which it evolves, another is called the Saline Spring, while the third is known as the White Sulphur Spring. Owing to the presence of these springs the site has for many years past acquired a great reputation as a place osummer resort. The appellants own a large hotel called the Caledonia Springs Hotel, and in the course of time other buildings have been erected which the learned Chancellor of Ontario in his judgment describes as 66 The Caledonia Springs Village attached to the hotel," and there are a Caledonia Springs Post Office and a Caledonia Springs Railway Station. The springs are called the Caledonia Springs, and the locality itself has also acquired the name of Caledonia Springs, very much like Tunbridge Wells, although in this case there is nothing which could properly be described as a town and no incorporated village.

There is a fourth spring situate about two miles from the other springs, called the "Intermittent " or " Duncan " Spring, belonging not to the appellants, but to a gentleman named King Arnoldi. The appellants, on December 27, 1899, acquired from Mr. Arnoldi the right to take water from the Duncan Spring and to use his registered trade marks for a period of two years, and also for ever to use in connection with the water of the Duncan Spring the words "Magi Caledonia Springs,' registered by them. The appellants thus include this spring also in the expression "Caledonia Springs."

The appellants use the water from their springs for the purpose of supplying the visitors at their hotel, and also supply it in barrels to their agents and others in Ontario and Quebec, who bottle it for the purpose of sale to the public. And they have registered as trade marks certain labels for use on the bottles. The appellants' waters and (it may be assumed) Mr. Arnoldi's waters also have acquired in the market the name of "Caledonia Water."

The respondent McDougall was also until recently the proprietor of an hotel at Caledonia Springs known as the Queen's Hotel. The respondent McDonell was the owner of land immediately adjoining the land of the appellants. McDougall, having some difficulty with the appellants as to the supply of their water for the visitors at his hotel, in the year 1898 commenced boring on the land of McDonell, who was his brother-in-law, and at the depth of 85 feet a spring of saline water was tapped, and a further boring made a short distance from the first struck a subterranean spring of sulphur water at a depth of 165 feet. Both springs have a continuous natural flow which rises up the pipes laid in the borings. These borings are situate about a quarter of a mile from the appellants' three springs, and the analysis of the water obtained from them shows a general resemblance to the waters from the appellants' springs. On August 1, 1898, McDonell entered into a partnership agreement with the respondents Lyall and Trenholme for placing on the market the waters from the borings thus made on his land. Arrangements were then made with the respondents Wilson for sale of the waters as agents for the partners at Toronto, and with the respondents J. Tune & Son for their sale at London (Ontario).

On February 5, 1901, the appellants commenced two actions against the respondents Wilson and against the respondents J. Tune & Son. The other respondents were afterwards added as defendants in each action. The two actions were consolidated, and were heard by the Chancellor of Ontario on June 11, 1901, and judgment was delivered on the 18th of the same month.

The plaintiffs in the action claimed an exclusive right to the use of the word "Caledonia in the phrases (amongst others) "Caledonia Water," ""Caledonia Seltzer," ," "Mineral Water from Caledonia Springs," and "From New Springs at Caledonia," and the words "Natural Saline Water" and "Natural Seltzer," and prayed an injunction to restrain the defendants from infringing the plaintiffs' trade marks and also from selling the water as Caledonia Water, or under any

GRAND HOTEL Co. OF CALEDONIA SPRINGS, LIM. v. WILSON. name, trade mark, or designation using the word "Caledonia" as descriptive of the same or to indicate the source of the water.

The learned Chancellor held that the respondents J. Tune & Son had infringed the appellants' trade mark, and the Court of Appeal agreed in that finding, and continued the injunction granted against those respondents. There is no appeal as to this matter, and it seems to their Lordships clearly right. It is fair, how ever, to the principal respondents to say that the obnoxious labels were adopted without any direction from them, and when they were made aware of the use of the labels they expressed their disapproval and said they could not undertake to defend it. As regards the labels used by the respondents Wilson, the Chancellor held that the defendants had not infringed the appellants' trade marks, but as to the trade names "Caledonia Water" and "Water from Caledonia Springs," the case of the plaintiffs was established, and he granted an injunction accordingly.

The respondents appealed, and their appeal was heard ultimately before Chief Justice Moss and Mr. Justice Maclennan and Mr. Justice Osler. The Chief Justice agreed with the Chancellor, but thought that the terms of the injunction should be varied in one respect. The two other learned Judges dissented (except as to the injunction against J. Tune & Son), and the reasons for their judgment were given by Mr. Justice Maclennan. The appeal was accordingly allowed, and by an order of December 4, 1902, the actions, save in respect of the injunction against the respondents J. Tune & Son, were dismissed with costs. Hence this appeal.

The learned counsel for the appellants did not lay much stress upon the alleged infringement of the trade marks except as regards the use of the word "Caledonia," and in their Lordships' opinion quite rightly. On this point, which is one of fact, their Lordships agree with the concurrent findings of the two Courts below. Nor do their Lordships think there is anything in the make-up of the respondents' goods to which the appellants can reasonably object. A more difficult

question is as to the use of the word "Caledonia as a trade name or as part of the description of the respondents' waters. It must be conceded that the respondents cannot use the word in such a manner as to pass off their goods for those of the appellants. But if they have not done so, they ought not to be restrained by injunction from the use of the word.

The first fact to be noted is that the goods in question are not a manufactured article, or (in other words) the name which it is sought to protect is not the name for the appellants' make of goods, but, to put it most favourably for the appellants, designates water from particular springs belonging to them. The waters derive their virtues from the strata from which they spring, or through which they pass before they reach the surface-that is to say, from the inherent properties of the soil itself in that particular locality. Another material fact is that the words "Caledonia Springs" and "Caledonia Water are said to designate the Duncan Spring and its waters equally with the appellants' three springs, although the former is distant two miles from the latter, and has no apparent connection with them, except that of being situate in the same township. It is quite true that the same trade name may designate the goods of more than one person, but it is less easy to infer that a geographical description has acquired a secondary meaning when you find that it is used to designate the goods of two or more persons connected only by identity of geographical origin. And whatever force there is in this observation does not appear to their Lordships to be materially weakened by the fact of there being other springs in the township which, like the "Duncan spring, are called by different names. Lastly, it must be observed that in the present case the name of the locality necessarily enters into and forms part of any real description of the respondents' waters, and that the words "Caledonia Springs" have acquired a secondary or perhaps tertiary meaning as the name, and the only name, of the locality. Their Lordships agree with Mr. Justice Maclennan that if the respondents' water is

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