THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
Case No. 573/97
In the matter between:
CADBURY (PTY) LIMITED
Appellant
and
BEACON SWEETS & CHOCOLATES
(PTY) LIMITED
1   Respondent
st
THE REGISTRAR OF TRADE MARKS
2  Respondent
nd
Coram:
VIVIER, HARMS, MARAIS, STREICHER JJA
AND FARLAM AJA
Heard:
25 FEBRUARY 2000
Delivered:
16 MARCH 2000
Trade marks - rectification by entry of disclaimer
JUDGMENT

HARMS JA
HARMS JA:
[1] This appeal relates to an application by the appellant (“Cadbury”)
to rectify the trade  marks register by having a disclaimer entered against
a trade mark registered in the name of the respondent (“Beacon”).  The
court a quo (Maritz AJ) refused the application for a number of reasons
but granted the necessary leave to appeal to this Court.  Its judgment was
reported: 1998 (1) SA 59 (T).
[2] Both Cadbury and Beacon are manufacturers and distributors of
sweets and confectionery.   The present dispute relates to trade mark
86/3570, registered in class 30 in respect of confectionery, sweets,
chocolates, candy, sweetmeats, ices and ice-cream.  The mark is a
composite mark.  It was amended and in its present form consists in the
main of a plate of sweets of the kind that have been marketed extensively

by Beacon since 1952 under the name Liquorice Allsorts, a little man
made of these sweets, a blank space and a prominent display of the name
L i q u o r i c e
Allsorts:
The mark is registered subject to the following disclaimer:
“Registration of this trade mark shall give no right to the exclusive use of the sweet
device [the plate], separately and apart from the mark.
The applicant undertakes that, in use, the blank space shall be occupied only by
matter of a wholly descriptive or non-distinctive character, or by a trade mark registered
in the name of the applicant in respect of the same goods, or by a trade mark of which the
applicant is a registered user in  respect of the same goods, or by a trade mark of a
registered user with the consent of the proprietor of such a mark or the blank space will
be left vacant.

The applicant undertakes that in use the trade mark will only be used in respect of
goods containing or including liquorice or liquorice flavour.”
[3] Contending that the name Liquorice Allsorts is descriptive of the
product and therefore not capable of distinguishing in the trade mark law
sense, Cadbury applied, without attacking the validity of the original
registration of the trade mark, for an additional disclaimer, namely that the
registration “shall also give no right to the exclusive use of the name
Liquorice Allsorts, separately and apart from the mark.”  (The relief
sought in the notice of motion was arguably more extensive, but nothing
turns on it.)  For this Cadbury relied upon s 15 of the Trade Marks Act
194 of 1993 which, simply put for present purposes, provides that if a
trade mark contains matter which is not capable of distinguishing within
the meaning of s 9, a court may require that the proprietor disclaim any

The full text of s 15 is the following:
“If a trade mark contains matter which is not capable of distinguishing within the meaning of section
9, the registrar or the court, in deciding whether the trade mark shall be entered in or shall remain on
the register, may require, as a condition of its being entered in or remaining on the register-
(a)
that the proprietor shall disclaim any right to the exclusive use of all or any
portion of any such matter to the exclusive use of which the registrar or the court holds him not to be
entitled; or
(b)
that the proprietor shall make such other disclaimer or memorandum as the
registrar or the court may consider necessary for the purpose of defining his rights under the
registration:
Provided that no disclaimer or memorandum on the register shall affect any rights of the proprietor
of a trade mark except such as arise out of the registration of the trade mark in respect of which the
disclaimer is made.”
right to the exclusive use of such matter.
[4] Section 15 is not concerned with the question whether a trade mark
itself is incapable of distinguishing, but whether matter contained in a
trade mark lacks this capability.  This is illustrated by the existing
disclaimer concerning the sweets device which was entered under a
somewhat similar provision in the repealed Trade Marks Act 62 of 1963
(s 18). That the term Liquorice Allsorts is “matter” within the meaning of
that word in s 15 of the current Act,  is not an issue.  The issue is rather

whether or not it is capable of distinguishing within the meaning of s 9.
Section 9 provides:
“(1) In order to be registrable, a trade mark shall be capable of distinguishing the
goods or services of a person in respect of which it is registered or proposed to be
registered from the goods or services of another person either generally or, where the trade
mark is registered or proposed to be registered subject to limitations, in relation to use
within those limitations.
(2) A mark shall be considered to be capable of distinguishing within the meaning
of subsection (1) if, at the date of application for registration, it is inherently capable of so
distinguishing or it is capable of distinguishing by reason of prior use thereof.”
[5] Since s 9(2) refers to the date of application for registration (in this
case, 1986)  Beacon argues that a court, after registration, may only
rectify the registration by means of a disclaimer under s 15 if, at the date
of application for registration, Liquorice Allsorts was not capable of
distinguishing. Beacon points out that the original registration is not under
attack and that, although some reference to dictionaries predating that
year was made, there is no evidence concerning the position in 1986.

Cadbury, on the other hand, submits that the reference to s 9 does not
include a reference to the date of application for registration; the court
should be concerned with the capability of the matter to distinguish at the
date of Cadbury's application for rectification, namely 1997.
[6] Although superficially attractive,  Beacon's argument does not bear
scrutiny.  The object of s 9 is to provide a test for the registrability of a
trade mark upon application.   For that reason the date upon which the
question has to be determined was set as the application date.  Section
15 is concerned with two situations.  The one is where the registrar or the
court has  to determine whether the trade mark shall be registered with or
without a disclaimer.  In this event they will likewise be concerned with
the date of application for registration.  But if the question is (as in this
case) whether the trade mark should remain registered in its present form,
the date of registration can no longer be relevant.  This is apparent from

It reads: “Provided that a mark shall not be refused registration by virtue of the provisions of
paragraph (2) or, if registered, shall not be liable to be removed from the register by virtue of the
said provisions if at the date of the application for registration or at the date of an application for
removal from the register, as the case may be, it has in fact become capable of distinguishing within
the meaning of section 9 as a result of use made of the mark.”
the wording of s 15 itself.  It is phrased in the present tense and concerns
itself with matter which is not capable of distinguishing at the time when
the court has to decide in what form the mark shall be entered or remain
on the register. A restricted reading of the phrase 'within the meaning of
section 9' is also not compatible with the proviso to sec 10  where the
same phrase is used and where it is quite clear that it does not have the
alleged time related limitation.   A further consideration is this.  Under the
repealed Act, the fact that a trade mark may have lost its ability to
distinguish was - subject to a qualification which is not apposite to the
present case - a ground for removing the mark from the register (Luster
Products Inc v Magic Style Sales CC 1997 (3) SA 13 (A)).   Section 10
(2)(a) of the new Act deals with the removal of a trade mark which 'is not

capable of distinguishing within the meaning of section 9'.  If Beacon's
argument were correct and by parity of reasoning, the law as laid down
in Luster would no longer apply.  There is no reason why the position
should have changed.  It cannot be in the public interest to have trade
marks on the register that cannot perform the basic trade mark function
of distinguishing as set out in s 9 (1).  A similar argument should be valid
for s 15.  Kerly's Law of Trade Marks and Trade Names (12  ed) par
th
9-02 in the context of s 14 of the Trade Marks Act 1938 (1 & 2 Geo 6,
c 22),  stated that the section gives the power “to give weight to
circumstances which may have arisen since the date of the original
registration.”   The same would have been true of s 18 of the repealed
1963 Act and although differently worded, a change of legislative intent
in this regard is difficult to discern.
[7] Another ground advanced by Beacon why s 15 does not apply to

the facts in the present instance is the submission that in a post
registration situation the section is restricted to a case where the court is
called upon to decide whether the trade mark “shall remain on the
register”.  Since the court below was not called upon to decide whether
the trade mark should remain on the register, but only whether or not to
enter a disclaimer, it had no jurisdiction to consider Cadbury's
application.   In other words, if an applicant has no objection to the trade
mark as a whole but only to matter therein contained, the applicant would
be obliged to launch an attack against the whole of the trade mark in
order to obtain relief under s 15.  A similar, but not identical, argument
was rejected in the court below because of the perceived absurdity of the
result (at 68A-C).  One would expect some or other motivation for such
a purely procedural limitation to be apparent.  None springs to mind.  The
phrase “in deciding whether the trade mark . . . shall remain on the

register” has a venerable ancestry, going back to at least s 15 of the Trade
Marks Act 1905 (5 Edw. 7, c 15).  We have not been referred to any
authority which has interpreted the phrase in the manner submitted.    It
seems to me that it is a necessary implication that the provision is not
only concerned with the question whether the trade mark should remain
at all on the register but also whether it should remain in its present form.
[8] Having cleared the undergrowth, I can turn to the last jurisdictional
requirement for the exercise of the discretion to enter a disclaimer in
terms of s 15.  It is whether the term Liquorice Allsorts is incapable of
distinguishing the liquorice confectionery of Beacon  from the same
product of any other person.   One can simplify the inquiry for present
purposes by posing the question whether Liquorice Allsorts is the name
of the product (a type of confectionery) or whether it is the name of
Beacon's product.  The relevant facts are refreshingly simple and not

really in dispute.  The term is given in some dictionaries as the name of
a product.  For instance, the Oxford English Dictionary (2  ed 1989) s
nd
v “all” defines the word “all-sorts” as a species -
“of confectionary (in full liquorice all-sorts), a mixture of black-and-white or brightly
coloured sweets containing liquorice.”
Contrary to the apparent view of the court below (at 71D-F), the hyphen
neither adds to nor subtracts from anything, especially since the use of
hyphens is usually optional and they are not pronounced.  Confectionery
manufacturing books give methods and recipes for the manufacture of
liquorice allsorts or allsort liquorice and, says Cadbury, Liquorice
Allsorts is a well established and recognised product type, manufactured
and produced in a substantially uniform configuration, notwithstanding
many individual variations.  During argument, counsel were unable to
suggest an alternative name for the product.  If one considers that a trade

mark performs an adjectival function in relation to goods or services, the
fact that another noun for the product is not readily apparent is a fair
indication that the term does not perform any function.
[9] Beacon sought to meet these facts by pointing out that it is the only
manufacturer and supplier of Liquorice Allsorts in this country since
about 1952.  Its annual sales, for example during 1996, amounted to
some R 33 million.  It expends large amounts in advertising, about R 1
million in 1996 alone.  One knows that facts such as these are often used
to convince the registrar or a court of the fact that a mark has become
distinctive.  But evidence of this nature must be approached with some
degree of circumspection.  The sole producer or distributor of a product,
whether new or old, cannot by means of advertising and selling the
product under its generic name, render that name capable of
distinguishing in terms of s 9.

[10] The evidence is further that Beacon manufactures and packages
Liquorice Allsorts for a number of large supermarket chains in this
country which sell, with Beacon's consent, Liquorice Allsorts under that
name.  For example, Pick 'n Pay sells the same kind of sweets under its
name and trade
mark and the name
Liquorice Allsorts
appears in a manner
and script which
b e a r s
n o
resemblance to the
registered
trade
mark.  It is also
true of the rest of
the packaging:

The same applies to Woolworths and to OK Bazaars.
[11] Beacon relied upon s 38 to justify its trading practice.  This
section deals with permitted use and registered users of trade marks.  The
question of a registered user does not arise on the facts of this case.  As
far as permitted  use is concerned, ss (1) and (2) have a bearing on the
defence:
“(1) Where a registered trade mark is used by a person other than the proprietor
thereof with the licence of the proprietor, such use shall be deemed to be permitted use for
the purposes of subsection (2).
(2) The permitted use of a trade mark referred to in subsection (1) shall be deemed
to be use by the proprietor and shall not be deemed to be use by a person other than the
proprietor for the purposes of section 27 or for any other purpose for which such use is
material under this Act or at common law.”
Unless the supermarkets have used the trade mark as registered with
Beacon's consent, their use cannot be permitted use within the meaning
of these provisions.  From the facts set out, it ought to be immediately

apparent that the use of the name Liquorice Allsorts was not use of the
trade mark as registered, but only of “matter” contained therein.  This
counsel had to concede.  But it goes even further.  A condition of
registration of the trade mark requires in essence that only a trade mark
registered in the name of Beacon, or in respect of which it is a registered
user, or a trade mark of its registered user may be used in the blank space
on its trade mark.  The marks of the supermarkets do not fall in any of
these categories and the breach of this condition cannot give Beacon any
rights or otherwise protect it.  These considerations, in my view, are
destructive of Beacon's defence.
[12] Having concluded that Beacon is not entitled to the exclusive use
of Liquorice Allsorts because it is used by Beacon and others in the trade
to describe the product and not to distinguish Beacon's product from
that of others, the question of the exercise of the court's discretion arises.

The court a quo purported to exercise its discretion against Cadbury, but
it appears to me that the court failed to distinguish between jurisdictional
facts and its discretion (especially at 68C-D and 77D-E) - the latter could
only have arisen once the jurisdictional facts were found to be present.
Since it found the jurisdictional facts lacking, the exercise of its discretion
did not arise.   There is in any event authority to the effect that a court on
appeal has an original discretion whether or not to require a disclaimer
and that it is not bound by that of the registrar or, in this instance, of the
court a quo (Distillers Corporation (SA) Ltd v Stellenbosch Farmers
Winery Ltd 1979 (1) SA 532 (T) 539B-C quoted with approval in Estee
Lauder Cosmetics Ltd v Registrar of Trade  Marks 1993 (3) SA 43 (T)
45F-G);   cf Media Workers Association of SA v Press Corporation of
SA Ltd 1992 (4) SA 791 (A) 800C-J).
[13] As was pointed out by the hearing officer in Philip Morris Inc's

Trade Mark Application [1980] RPC 527 at 532 - 533, a disclaimer is,
theoretically, never necessary since registration of a trade mark cannot
give rise to any rights except those arising from the mark as a whole.  It
has nonetheless a function.  Primarily, it is to prevent the registration of
a composite mark from operating so as to inhibit the use of the
disclaimed element by others. Beacon, relying upon the fact that the name
Liquorice Allsorts is the dominant part of the trade mark, is asserting
trade mark rights in Liquorice Allsorts per se against others based upon
this registration.  It also has a pending application for the registration of
Liquorice Allsorts simpliciter.  This is therefore a textbook case  for a
disclaimer.  (Cf Estee Lauder Cosmetics at 46D-J.)  Statutory
monopolies are the exception, not the rule and they need to be justified
(Wagamama Ltd v City Centre Restaurants Plc and Another [1995]
FSR 713 (Ch D) 728 -729).

[14] The court below (at 77B-D) accepted Beacon's argument that
Cadbury was sufficiently protected by the provisions of s 34(2)(c) of the
Act which provide inter alia that a registered trade mark is not infringed
by the use of any bona fide description or indication of the kind of the
goods concerned.  Cadbury, if its allegations are to be accepted, is thus
without  a disclaimer possessed of a perfect defence.  I find the attitude
unrealistic because I cannot see why Cadbury should be put to the
trouble and expense of first manufacturing and selling and then be
subjected to the risk of infringement litigation where the Legislature has
given it a simple remedy akin to a declaration of rights to obtain certainty.
I do realise that due to the proviso to s 15, Beacon may nevertheless
attempt to assert rights to Liquorice Allsorts by means of a common law
action based upon passing-off (cf Antec International Ltd v South
Western Chicks (Warren) Ltd [1997] FSR 278), but that is not a

sufficient reason to refuse the relief sought since the nature of the
protection provided by that action differs from trade mark protection.
[15] In the result the appeal has to succeed and the following order is
made:
(a)
The appeal is upheld with costs, including the costs of two
counsel;
(b)
for the order of the court below is substituted an order -
(i)
Rectifying the registration of trade mark 86/3570 by the
insertion of the following additional disclaimer:  “The
registration of this mark shall also give no right to the
exclusive use of the name Liquorice Allsorts, separately and
apart from the mark”;
(ii)
That the first respondent pay the costs of the application,
including the costs of two counsel.

__________________
L T C HARMS
JUDGE OF APPEAL
AGREE:
VIVIER JA
MARAIS JA
STREICHER JA
FARLAM AJA