Curust Financial Services Ltd v Loewe-Lack-Werk

• Jurisdiction: Ireland
• Judge: Mr. Justice Barron
• Judgment Date: 03 July 1992
• Neutral Citation: 1992 WJSC-HC 1603
• Docket Number: No. 4108p/1992
• Court: High Court
• Date: 03 July 1992

1992 WJSC-HC 1603

THE HIGH COURT

No. 4108p/1992

CURUST FINANCIAL SERVICES v. LOEWE-LACK-WERK OTTO LOEWE GMBH AND CO

CURUST FINANCIAL SERVICES LIMITED AND CURUST INDUSTRIESLIMITED

PLAINTIFFS

v.

LOEWE-LACK-WERK OTTO LOEWE GMBH AND CO., K.G. AND R.S. SALESLIMITED

DEFENDANTS

Citations:

WESTMAN HOLDINGS V MCCORMICK 1991 ILRM 833

TREATY OF ROME ART 85(1)

Synopsis:

INJUNCTION

Interlocutory

Fair question - Convenience - Balance - Goods - Manufacture - Exclusive rights - Foreign licence - Termination - Manufacture of rust primer - Treaty of Rome (EEC), article 85 - (1992/4108 P - Barron J. - 3/7/92) - [1994] 1 I.R. 450

|Curust Financial Services Ltd. v. Loewe-Lack-Werk Otto Loewe GmbH|

1 Judgment of Mr. Justice Barrondelivered the 3rd day of July 1992.

2 The first named Defendant is the manufacturer of a rust primer. The Plaintiffs have for many years marketed this product inter alia on the Irish market. They do so under the Defendant's trademark for which they are registered. The Plaintiffs bring these proceedings as against the first named Defendant to enforce the terms of an exclusive manufacturing and distributorship agreement dated 27th November 1986 and as against the second named Defendant in effect to prevent that Defendant from dealing in the goods.

3 The essential facts giving rise to these proceedings are asfollows:

4 The Plaintiffs who had manufactured the product in this country in accordance with agreements between them and the first named Defendant suspended manufacture and by agreement bought direct from the first named Defendant. On the 27th July 1990 a price agreement was entered into between the parties setting out prices and conditions for payment. Following upon the making of this agreement the parties fell out over the time of payment and the first named Defendant on the 5th of October 1990 purported to cancel all agreementsbetween the parties as from that date. Notwithstanding this, the first named Defendant continued to supply the Plaintiff with product until the 31st December 1991 being the date upon which the price agreement was in accordance with its provision to have determined. Early in 1992 the Plaintiffs recommenced manufacture of the Defendant's product though somewhat later than envisaged by the price agreement. Early in June 1992 the second named Defendant placed on the market under its own trade name the first Defendant's product.

5 Having discovered this latter fact, the Plaintiffs commenced these proceedings and now seek interlocutory relief which will in effect leave them free to be the sole party marketing the first named Defendant's product in this jurisdiction.

6 Prima facie the 1986 agreement gives them the rights which they seek. It is accordingly necessary to consider the submissions made on behalf of the Defendants. The first named Defendants contest the existence of the 1986 agreement but accepts that for the purposes of an application for interlocutory relief the Plaintiffs have established the existence of a triable issue as to its having been made. It submits however that it was validly terminated on the 5th of October 1990. At that date there was a genuine dispute as to the time of payment and a delay in payment caused by a bank in Germany for which the Plaintiffs were not responsible. In my view the Defendants must show a clear repudiation of the 1986 agreement before this ground can succeed. The Plaintiffs" only need to show a triable issue that their conduct did not repudiate the 1986 agreement and in my view they have so done.

7 This Defendant next contends that the 1986 agreementwas contrary to Article 85 (1) of the Treaty of Rome. The relevant question is whether or not upholding the agreement will have an appreciable effect upon trade in the particular product insofar as it is envisaged by the agreement. This Defendant submits that on...