This is an interesting question. It appears, at first light, to involve three issues:
- Breach of contract;
- Infringement of a trademark (registered or unregistered); and
- Passing off
We’ll deal with each of these issues in turn and then look at the possible remedies in the circumstances. We’ll refer to the parties as:
- The landlord – “Mr L”
- The previous tenant – “Mr P”
- The current tenant – “Mr C”
Breach of contract
It appears that there is a potential claim for breach of contract here. Although we don’t know what the exact terms of the contract were on the facts there was a contract between Mr L and Mr P – Mr P leased the premises for his restaurant from Mr L in return for consideration (a payment of money or some other benefit). Mr P hasn’t stated that he is in repudiatory breach of contract (which would potentially have entitled Mr L to terminate the contract) so Mr L is in repudiatory breach of contract by terminating the lease. He has breached the contract that existed and Mr P is therefore entitled to submit a breach of contract claim against Mr L.
Infringement of a trademark (registered or unregistered)
Mr P’s restaurant name (it shall remain anonymous for confidentiality reasons) is a trademark – a sign which is graphically represented and capable of distinguishing his services from those of another. He hasn’t informed us that he has registered the trademark so we shall proceed on the assumption that the trademark is unregistered. To learn how to register a trademark, click here. If so, Mr P can’t fall back on the provisions of the Trade Mark Act 1994 (“TMA 1994”) to protect his intellectual property. However, if Mr P had registered his restaurant name as a trademark then he could make a statutory claim for trademark infringement under the Trade Marks (Amendment) Act 1984. As Mr P’s trademark is unregistered he can only rely on an action for passing off against Mr C.
Mr C is attempting to represent the services of Mr P’s restaurant business as his restaurant business (he hasn’t changed the name of the restaurant). Mr P could therefore have a valid action against Mr C for “passing off” – a common law claim. In order to succeed in his claim Mr P would have to show that there was:
- Goodwill in his business, goods or services
- That Mr C had made a misrepresentation to customers which deceived them into thinking that Mr P’s goods or services were connected with those of Mr C
- The misrepresentation causes or is likely to cause damage to Mr P’s business or goodwill
There are a variety of remedies that Mr P could have recourse to. For the breach of contract claim he could, for example, obtain damages from Mr L
For the passing off claim Mr P could:
- Apply for an injunction against Mr C
- Obtain damages from Mr C for loss of sales and damage to goodwill and reputation
- Force Mr C to account for any profits he’s made from the misrepresentation
If you’ve got a question relating to intellectual property or breach of contract ask us a question on our intellectual property forum!