Van Willing Funerals CC and Another v Vision Direct 155 (Pty) Ltd t/a Transafrica

The first applicant, Van Willing Funerals CC, was incorporated in 2005 as a funeral undertaker continuing a family business dating back to 1938. The second applicant, Mr 'Junior' Van Willing, was its sole member. The respondent, Vision Direct 155 (Pty) Ltd trading as Transafrica Group, was a licensed Financial Service Provider (FSP) offering insurance products including funeral policies, but not funeral services. The close corporation's FSP licence was withdrawn in 2014, but from July 2020 it acted as a representative of Structured Risk Solutions (Pty) Limited, a licensed FSP, to sell funeral policies. In November 2022, Mr Van Willing, acting on behalf of the close corporation, entered into an underlying agreement with Transafrica whereby Brijuwen CC (another entity owned by Van Willing) and twelve individuals would be appointed as mandated representatives to sell funeral policies under Transafrica's FSP licence. Training was provided in December 2022. On 1 March 2023, three funeral policies were sold by the nominated representatives. The policy documentation and covering letters referred to the policies as 'Van Willing Funerals' policies, were signed at the bottom as 'Junior Van Willing - Owner' (though the signature was not his), and prominently displayed Transafrica's details and disclosed that policies were underwritten by Centriq Life Insurance. Commissions were paid to the close corporation. The applicants alleged this constituted unlawful passing off, fraud, and forgery of Mr Van Willing's signature, and sought a final interdict. The respondent argued the representation was authorised by the underlying agreement and that the parties had agreed the policies would be marketed as 'Van Willing Funerals' policies.

• Whether the applicants established a clear right to the relief sought, including proof of reputation and unauthorised, false representation necessary for passing off
• Whether the respondent's conduct was likely to deceive the public or cause confusion as to the source or association of the funeral policies
• Whether the applicants suffered or reasonably apprehended injury to their goodwill, reputation, or business
• Whether the use of the trade name 'Van Willing Funerals' in the policy documentation was authorised by the underlying agreement between the parties
• Whether the requirements for a final interdict (clear right, injury committed or apprehended, no alternative remedy) were satisfied

The application was dismissed. The applicants were ordered to pay the respondent's costs jointly and severally, with costs of counsel taxed on Scale B.

To succeed in an action for passing off, an applicant must prove: (1) that the trademark, trade name, or get-up has acquired a reputation with the public associated with the applicant's goods, service, or business; and (2) that the defendant's conduct was likely to, or calculated to, deceive the public. For a final interdict, an applicant must establish a clear right, an injury actually committed or reasonably apprehended, and no alternative remedy. A representation that would otherwise constitute passing off cannot found a cause of action where that representation was authorised by the party alleging injury. Passing off requires both a false and an unauthorised representation. Where parties have entered into a contractual arrangement authorising the use of a trade name, and such use occurs pursuant to that agreement, the representation is authorised and no action for passing off lies. The absence of a common field of activity is a factor to be considered in determining whether there is a reasonable likelihood of confusion, though it is not determinative.

The court observed that entities not licensed as FSPs under the FAIS Act cannot sell funeral policies in their own name but may do so as mandated representatives of licensed FSPs. The court noted that in some cases of passing off involving fraudulent intent, it may not be necessary to prove reputation, but in interdict proceedings it is not necessary to allege either intention to deceive or negligence. The court commented that whereas a close corporation selling funeral policies and an insurance intermediary are not in the same field of business, there is area overlap, and the arrangement likely benefited the close corporation by creating an association that would lead policyholders to engage the close corporation's funeral services. The court observed that infringement of goodwill can occur through disparagement (where inferior performance damages reputation) or dilution (reducing advertising value), but neither was established in this case. The court declined to make a punitive costs order despite the applicants' failure to disclose the contractual relationship in founding papers and absence of confirmatory affidavits, finding the application not 'frivolous' though it had weaknesses.

This case clarifies important principles regarding passing off in South African law, particularly: (1) that consent or authorisation by the alleged aggrieved party to use their trade name negates the element of 'unauthorised representation' required for passing off; (2) the importance of considering the entire context, including contractual relationships between parties, when assessing whether conduct constitutes passing off; (3) the need for applicants in passing off cases to prove not only reputation and likelihood of confusion, but also that the representation was both false and unauthorised; (4) that even where parties operate in overlapping fields, authorised use of a trade name pursuant to mandate agreements in the financial services regulatory context will not constitute actionable passing off; and (5) the regulatory framework under the Financial Advisory and Intermediary Services Act (FAIS Act) and Long-Term Insurance Act regarding FSPs, binder holders, intermediaries, and mandated representatives in the insurance industry. The case demonstrates that commercial parties who enter into representative agreements cannot later complain of passing off based on the very conduct they authorised.