The appellant (Morris Material Handling Limited, a British company) was the registered proprietor of the trade mark "MORRIS" in South Africa under registration number 1935/00289/2-3 in classes 7 and 11. The mark was originally registered by a US corporation (MHE Technologies Inc) but was assigned to the appellant (then called GW 103 Ltd) in 2001. In 2006, Konecranes Plc acquired the appellant. The respondent (Morris Material Handling SA (Pty) Ltd), a South African company that manufactures cranes, sought to register its own MORRIS trade mark in 2014 but was blocked by the appellant's existing mark. The respondent brought proceedings to have the appellant's mark expunged from the register for non-use. Evidence showed that in 2013-2014, Konecranes (Pty) Ltd established a parts distribution centre in South Africa supplying parts for various crane brands including "MORRIS", with fliers and emails referring to MORRIS as a Konecranes brand. The appellant claimed this constituted use by it under an "internal arrangement" with Konecranes, but provided no clear evidence of this arrangement or of its own trading activities.
The appeal was dismissed with costs, including costs consequent upon the employment of two counsel. The high court's order for rectification of the trade mark register (expunging the appellant's MORRIS mark) was upheld.
To resist expungement of a trade mark for non-use under section 27(1)(b) of the Trade Marks Act 194 of 1993, the registered proprietor must provide clear and unambiguous factual evidence that it (the proprietor) made bona fide use of the mark during the relevant period. Bare allegations of use or arrangements with related entities are insufficient. Where documentary evidence of use (such as invoices, contracts, trading accounts, financial records) should reasonably be available, the failure to produce such evidence will count heavily against the proprietor in discharging the onus resting upon it. Use of a trade mark by other entities within a corporate group cannot be attributed to the registered proprietor without clear evidence of the specific arrangement, authorization, and relationship between the proprietor and the entity actually using the mark. The onus remains on the proprietor to prove use on a balance of probabilities, but this requires factual evidence with sufficient particularity, not mere assertions.
The court clarified that it was not suggesting the onus on the proprietor was anything more than the ordinary civil standard of proof on a balance of probabilities - it was not imposing a higher standard of proof. The court also noted that the case was conducted as one involving use by the proprietor rather than permitted use under section 38, as the appellant's counsel expressly eschewed reliance on permitted use, making it unnecessary for the court to address that aspect. The court observed that in enterprises the size of international corporate groups, formal records of arrangements, agreements, board minutes and correspondence would be expected to exist if distributorship or licensing arrangements were in place. The complete absence of any such documentation was telling. The judgment contains implicit criticism of corporate groups that ignore separate legal personalities and treat trade marks as group property while failing to maintain proper records of how marks are actually used and by whom.
This case is significant in South African trade mark law as it clarifies and reinforces the evidentiary requirements for proprietors seeking to resist expungement for non-use under section 27(1)(b) of the Trade Marks Act. It emphasizes that: (1) bare allegations without supporting factual detail are insufficient; (2) where documentary evidence such as contracts, invoices, and financial records should be available to prove use by the proprietor, failure to produce such evidence will count heavily against the party bearing the onus; (3) use by related entities within a corporate group cannot be assumed to be use by the registered proprietor without clear evidence of the relationship and arrangement; (4) in corporate groups that tend to ignore corporate identities and treat trade marks as group property, particular care must be taken to demonstrate which entity is actually using the mark; (5) the evidence must be "clear and unambiguous" and show use by the proprietor itself (or properly authorized permitted users), not merely use of the mark generally by unspecified entities. The judgment reinforces that trade mark registration requires active commercial use by the proprietor and cannot be maintained through vague or unsubstantiated claims of use by related entities.