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Scottish Court of Session Decisions


You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> British Thomson-Houston Co., Ltd v. Charles-Worth, Peebles, & Co. [1922] ScotLR 550 (15 July 1922)
URL: http://www.bailii.org/scot/cases/ScotCS/1922/59SLR0550.html
Cite as: [1922] ScotLR 550, [1922] SLR 550

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SCOTTISH_SLR_Court_of_Session

Page: 550

Court of Session Inner House First Division.

Saturday, July 15. 1922.

[ Lord Blackburn, Ordinary.

59 SLR 550

British Thomson-Houston Company, Limited

v.

Charles-Worth, Peebles, & Company.

Subject_1Patent
Subject_2Infringement
Subject_3Interdict
Subject_4Interdict against Exportation of Infringing Articles Brought into this Country from Abroad.
Facts:

The patentees of an electric lamp who had obtained interdict against foreign manufacturers infringing their patent in this country brought actions of interdict against certain merchants in which they craved interdict against the respondents “using, putting in practice, disposing, selling, or offering for sale, or importing into the United Kingdom, or exporting therefrom” the lamps in question. The respondents only resisted that part of the crave which related to exportation, on the ground that exportation did not per se constitute an infringement, and they declined to accept any limitation on the right they claimed, which would leave them free to return to their foreign consigners lamps sent into this country by mistake in infringement of the patentee's rights. Held ( diss. Lord Skerrington) that in view of the fact that the complainers were merchants and not carriers, and that they asserted an unlimited right of exportation

Page: 551

which might operate to the detriment of the patentees, that the latter were entitled to interdict as craved.

Headnote:

The British Thomson-Houston Company, Limited, London, complainers, presented a note of suspension and interdict against Charlesworth, Peebles, & Company, mechanical and electrical engineers and merchants, Glasgow, respondents, to have the defenders interdicted from infringing letters patent (No. 10,918 of 1913) granted in favour of the pursuers for improvements in incandescent electric lamps and from using, putting in practice, disposing, selling or offering for sale, or importing into the United Kingdom of Great Britain and Ireland, or exporting therefrom during the currency of the said letters-patent and without the consent, licence, or agreement of the complainers … incandescent electric lamps which embody the improvements described in the complete specification filed relative to the said patent.

The complainers had already obtained interdict against the foreign makers infringing their patent in this country.

In the present action the issue between the parties came ultimately to be whether the decree of interdict to be granted should include interdict against exportation. The complainers made no special averments in support of such interdict, but the question was raised in the following plea-in-law for the respondents:—“(5) Exporting from the United Kingdom not in itself constituting infringement, interdict cannot competently be granted in the terms of the prayer.”

On 1st June 1922 the Lord Ordinary ( Blackburn) granted interdict in terms of the prayer in the action upon the patent of 1913.

Opinion.—“There are two actions here against the defenders Charlesworth, Peebles & Company, one of suspension and interdict, which originated in the Bill Chamber, and the other an action of interdict, delivery, and payment. In the latter action the defenders have put in a minute withdrawing their defences, and in particular withdrawing their four pleas-in-law, which is equivalent to an admission that decree both of interdict and delivery must be pronounced in favour of the pursuers. In the action of suspension and interdict there is a conclusion in the note against the defenders exporting the lamps to which both actions apply from this country, and in the minute put in by the defenders in that action they have only withdrawn their first four pleas-in-law, leaving a fifth plea to the effect that exporting from the United Kingdom is not in itself an infringement of the patent. I am asked to refuse the interdict which the pursuers now seek against exporting the lamps on the ground that this plea leaves an important question to be discussed on which I ought to hear a full debate. It seems to me that once the defenders have admitted, as I think their minute does admit, that the decree for delivery must go out against them under the action of interdict, delivery, and payment, it is idle for them to ask me to postpone granting interdict in the other action against their exporting the lamps from this country. To do so would only leave them an opportunity of defeating the other decree, and accordingly I shall pronounce decree of interdict in terms of the note in the suspension and interdict as well as interdict and delivery in the other action. The question of damage is reserved, and I shall reserve the question of expenses until the damages are disposed of.”

The respondents reclaimed, and argued—Export of a patented article did not necessarily imply infringement. The complainers were already protected against export for commercial purposes by the interdict against “using, disposing, selling, or offering for sale.” Sending patented goods out of the United Kingdom was not per se an infringement, for it was taking the goods beyond the ambit of the patent. Transport of such goods was not of itself an infringement, though if done for sale or use it might become an infringement— Badische Anilin and Soda Fabrik v. Johnson & Company, 1897, 14 R.P.C. 919, [1898] AC 200; Frost, Patent Law (4th ed.), pp. 385, 387, 388. There was a distinction between cases where the person handling the patented goods obtained an advantage and cases where no such advantage emerged— Neilson v. Betts, 1870, L.R., 5 H.L.C. 1, at p. 10; Nobel's Explosives Company v. Jones, Scott, & Company, 1881, 17 Ch D 721, per James, L. J., at pp. 741, 742; Badische Anilin and Soda Fabrik v. Johnson & Company ( cit. sup.), per Lord Herschell. It was not an infringement to be in innocent possession of a patented article— Pessers, Moody, Wraith, & Gurr, Limited v. Newell & Company, 1914, 31 R.P.C. 510; British United Shoe Machinery Company, Limited v. Simon Collier Limited, 1910, 27 R.P.C. 567. The property of articles made in violation of a patent was with the infringer if he would otherwise have the property in them, and the Court only interfered to prevent them being used in derogation of the patentee's rights— Vavasseur v. Krupp, 1878, 9 Ch. D. 351, per Cotton, L. J., at p. 360.

Argued for the complainers (respondents)—The complainers' right to interdict against importing generally was admitted, but exporting was correlative with importing. Mere export might constitute infringement— British Motor Syndicate, Limited v. Taylor & Sons, Limited, 1900, 17 R.P.C. 189, 723, [1900] 1 Ch 577, [1901] 1 Ch 122. Use for experiment and instruction might constitute infringement— United Telephone Company v. Sharples, 1885, 2 R.P.C. 28, 29 Ch. D. 164. Even the return of infringing goods to the source from which they came might be an infringement— Upmann v. Elkan, 1871, L.R., 7 Ch. 130, per Lord Hatherley; Kerly on Trade Marks (4th ed.), p. 499, was also referred to. [The Lord President referred to Betts v. Willmott, 1870, 18 W.R. 946.]

At advising—

Judgment:

Lord President—The reclaimers are merchants and deal in, among other things, electric lamps. They were importers of a particular class of lamp, manufactured in Holland, which infringes the Thomson-Houston Company's patent. The latter

Page: 552

company had already obtained interdict against the Dutch makers infringing their patent in this country, and in the present note of suspension and interdict they seek interdict against the reclaimers doing so likewise. The merits of the question thus arising between the Thomson—Houston Company and the reclaimers were disposed of adversely to the reclaimers in an ordinary action concluding, inter alia, for damages and delivery of the infringing lamps in their possession at the date when the action was raised. In the note of suspension and interdict the reclaimers withdrew all their pleas—including that to relevancy—except the fifth, and it is on this plea that the question arises.

The prayer craves interdict against both importation into this country and exportation from it, as well as the usual interdict against making, using, exercising, and selling. The reclaimers have no objection to any part of the interdict except that which relates to exportation, and the ground of their objection is that stated in their fifth plea, namely, that “exporting from the United Kingdom does not in itself constitute infringement.”

The point arises in very peculiar circumstances.

In the first place, the Thomas-Houston Company do not make on record any special averments to support an express interdict against exportation. Not only, however, have the reclaimers withdrawn their plea to relevancy, but when invited to recur to this ground of objection for the present purpose their counsel declined to adopt that course.

In the second place, it might have been thought superfluous to add to an interdict which already covers manufacture, use, exercise, sale, and importation, any express mention of exportation. But the reclaimers frankly explained that while they had no intention of importing for use or sale in this country, their desire was to be free in the matter of exportation from it. They referred to the principle discussed in such cases as Neilson v. Betts ( (1871) L.R. 5 (H.L.) 1) and Badische Anilin Fabric v. Basle Chemical Works ( [1898] AC 200, see especially per Lord Herschell at p. 208), by which warehousemen or transport agents do not necessarily commit infringement by handling a patented article. But they did not dispute that any projected handling of these infringing lamps on their part would be neither as warehousemen nor as transport agents, but in their capacity as merchants. If there is the smallest chance that the reclaimers would regard themselves free, under an interdict which did not expressly include exportation, to import these lamps and, instead of selling them in this country, to export them to purchasers abroad, I am very clear that exportation should be expressly covered by the interdict. The reclaimers also explained that they anticipate receipt in the future from the Dutch maker or other persons of infringing lamps among or in lieu of supplies of non-infringing lamps ordered by them. This might, no doubt, occur by mistake, and they desired to be free in such an event to return the goods without risk of incurring penalties for breach of interdict. Cases such as Upmann v. Elkan ( (1871) L.R, 7Ch. Ap. 130) and Betts v. Willmott ( 1870, 18 W.R. 946) show that it is not difficult in circumstances of this kind for a merchant who finds himself innocently in possession of in fringing articles to adopt a line of action which will protect him. It was accordingly suggested to the reclaimers that a refusal on their part of infringing goods which they had not ordered and the return thereof to the sender, if that was all that was intended, might easily be reserved to them (if necessary) by adjecting a few qualifying words to the interdict. But they declined to avail themselves of an opportunity which was afforded to them of proposing such words. I think in these somewhat unusual circumstances it would not be fair to the patentees to refuse interdict, in the case of merchants of this class of goods, against exportation.

It appears that the Lord Ordinary had mainly in view the risk of defeating the order for delivery of infringing articles pronounced in the ordinary action. But the reclaimers have made it perfectly clear that the question is of wider ambit and involves possible future commercial dealings.

Lord Mackenzie—Interdict ought in my opinion to go out in terms of the Lord Ordinary's interlocutor. There are sufficient grounds for this in the way the respondents put their case in plea 5—“In any event, exporting from the United Kingdom not in itself constituting infringement, interdict cannot competently be granted in terms of the prayer.” If there had been reason to doubt what the position of the respondents is, it was removed by the argument submitted on their behalf. This made it plain that they did not limit their right to send out of the country goods which they rejected and returned to the consignors. They are merchants, not carriers, and when they urge a wider right than this they emphasise the necessity for giving the patentees protection to the fullest extent.

Lord Skerrinoton—I am of opinion that the interdict as granted by the Lord Ordinary was unduly wide, in respect that it restrained the respondents from infringing the complainers' patent by “exporting” from the United Kingdom incandescent electric lamps of the kind described in the prayer of the note of suspension and interdict. In the first place, the complainers' statement of facts contains no averments which would justify an interdict against exportation. On the contrary, it is absolutely silent upon that subject. In the second place, the only ground stated by the Lord Ordinary in his opinion for subjecting the respondents to an interdict against exporting lamps is unsatisfactory and indeed untenable, and the complainers' counsel did not venture to maintain it. In the third place, the interdict as granted offends against the fundamental and salutary rule that an interdict ought not to be expressed in language which is of doubtful meaning. A respondent is entitled to know exactly

Page: 553

what it is that he must abstain from doing. The lengthy debate to which we listened showed that opinions may reasonably differ as to the meaning of the word “exporting” as used in the interdict. If the complainers desired to obtain from the Lord Ordinary or to maintain in the Inner House an interdict against the exportation of lamps by the respondents, their counsel ought, in my judgment, to have asked leave to amend their pleadings by adding the averments which were necessary both from the point of view of relevancy, and also for the purpose of defining the acts from which the respondents must abstain under pain of committing a breach of interdict. In expressing this opinion I have not lost sight of the fact that the respondents' fifth plea-in-law may be construed as an assertion of a right to “export” lamps whatever may be implied by that expression. This circumstance does not in my view exonerate the complainers from the duty of presenting their case to the Court in proper and usual form. I think that the interdict ought to be limited by omitting the words “or exporting therefrom.”

Lord Cullen—I concur with the majority of your Lordships.

The Court adhered.

Counsel:

Counsel for the Respondents (Reclaimers)— Moncrieff, K.C.— Wark, K.C.— Burn Murdoch. Agents— Davidson & Syme, W.S.

Counsel for the Complainers (Respondents)—Dean of Faculty ( Sandeman, K.C.)— Normand. Agents— Webster, Will, & Company, W.S.

1922


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