Precismeca Limited v Melco Mining Supplies (Pty) Limited

Precismeca Limited concluded a written agreement in 1975 under which it granted Melco Mining Supplies (Pty) Limited an exclusive right to manufacture and sell certain products described as ‘rollers and idlers’ within a defined territory, in return for the payment of royalties. The agreement referred to patents applied for and existing patents, as well as to trademark rights, but no patent licences were ever granted, no trademark user agreement was concluded, and the listed patents had expired either before or shortly after the conclusion of the agreement. Despite this, the parties performed under the agreement for more than 20 years. Precismeca (having taken cession of rights under the agreement) sued Melco in the High Court for a statement and debatement of account and payment of outstanding royalties. Melco raised a special plea that the High Court lacked jurisdiction because, under s 18(1) of the Patents Act 57 of 1978, only the Commissioner of Patents could determine matters relating to patent rights. The High Court upheld the special plea, prompting this appeal to the Supreme Court of Appeal.

The appeal was upheld with costs, including the costs of two counsel. The High Court’s order upholding the respondent’s special plea of lack of jurisdiction was set aside.

The case clarifies the limits of the exclusive jurisdiction of the Commissioner of Patents under s 18(1) of the Patents Act. It confirms that not all disputes referencing patents fall within patent jurisdiction, and that common-law contractual claims remain justiciable in the High Court even where patents are mentioned incidentally. The judgment provides important guidance on distinguishing patent licensing agreements from common-law technology or know-how licences.