GEOK ENG CO LTD v. HOE HIN PAK FAH YEOW MANUFACTORY, LTD

HCMP 1434/2017

[2018] HKCFI 258

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1434 OF 2017

(On Appeal from Registrar of Trade Marks)

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D E C I S I O N

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INTRODUCTION

1.  Upon the application of Hoe Hin Pak Fah Yeow Manufactory, Ltd (“HHPFYML”), the Registrar of Trade Marks (“the Registrar”) declared the two trademark registrations (“the Registrations”) owned by Geok Eng Company Ltd (“GECL”) to be invalid by her decisions both dated 20 July 2016 (“the Decisions”) on the ground of bad faith. This is an application of GECL by way its summons dated 20 June 2017 (“the Summons”) for leave to extend the time to serve its Notice of Motion to appeal against the Decisions.

2.  This is not the first time that GECL has taken legal steps to appeal against the Decisions. It issued a Notice of Motion within time on 17 August 2016 (“the 1^st Notice of Motion”). This court by a decision handed down on 6 March 2017 (“the Striking-Out Decision”) stuck out the 1^st Notice of Motion on the ground that it was defective upon the application of HHPFYML.  I shall refer to the Striking-Out Decision for the background facts.

3.  GECL did not appeal against the Striking-Out Decision. With a new legal team, it decided to take out the Summons so as to serve a new Notice of Motion out of time. HHPFYML opposes this application on the major ground that there was a substantial and inexcusable delay and that the intended appeal lacks a real prospect of success.

Applicable legal principles

4.  There is no dispute that the governing principles relating to this application should be akin to those concerning applications for extension of time to appeal. In Fung Kam Kwong v Fung Kau, unreported, CAMP35/2017, 17.11.2017, Lam VP giving the Judgment of the Court of Appeal stated again the established principles in the following terms:

“5. In Tang Chai On v Tang Sing Ki [2016] 5 HKLRD 104, this Court set out the well-established approach to be adopted in an application for extension of time to appeal. In that case, this Court reiterated that the approach (as applied by Kwan JA in Lee Chick Choi v Best Spirits Co Ltd HCMP 371 of 2015, 21 May 2015) should be adhered to. The approach involved the consideration of the following factors in the exercise of discretion:

(a) The length of the delay;

(b) The reasons for the delay;

(c) The chance of success of the intended appeal;

(d) The prejudice to the other party.

6. Further, where the delay is substantial and not wholly excusable, the applicant must show a real prospect of success on the merits, see Secretary for Justice v Hong Kong & Yaumati Ferry Co Ltd [2001] 1 HKC 125; Chee Fei Ming v Director of Food and Environmental Hygiene [2015] 4 HKC 134.”

5.  There is, however, a debate about the extent to which the merits should be considered. Mr Tam, for GECL, relies on the two decisions of Keith JA in Tridant Engineering Co Ltd v Manson Holdings Ltd, unreported, CACV 311/2000, 19.9.2000 and Unison Knitwear Ltd v Rich Easy Ltd [2001] HKLRD 856 for his submission that if an informed assessment of the prospects of success of an appeal can only be made at the hearing equivalent to the hearing of the appeal itself, then the overall interests of justice required that the intended appellant’s time to be extended without any further consideration of the merits.

6.  I agree with Mr Wong, for HHPFYML, that the said two decisions do not really support the submission of Mr Tam. First, in the Tridant case, Keith JA adopted the approach that where the circumstances are exceptional, time may be extended without a consideration of the merits if, in order to assess the merits, a lengthy and time-consuming hearing is necessary. There, Keith JA found that the delay was short, the intended appellant itself was blameless and no prejudice had been caused to the other side. He was then driven to the conclusion that the overall interests of justice required the grant of the extension of time unless the intended appeal had no real prospect of success. However, since the assessment would be a lengthy one, being equivalent to the hearing of the appeal itself, the learned judge concluded that the overall interests of justice required that an extension be granted without any further consideration of the merits. In any event, the learned judge was of the very provisional view that it could not be said that the appeal had no real prospect of success.

7.  In the Unison Knitwear Ltd case, Keith JA adopted the same approach and found the facts there very similar to that of the Tridant case. Again the exceptional circumstances (short delay caused by the legal advisers without causing any prejudice to the other side) were present and he could not make any informed assessment of the merits without a further hearing which would be likely to escalate into a mini hearing of the appeal itself. On that basis, the learned judge granted the extension of time.

8.  On the other hand, Mr Wong pertinently refers this court to the dictum of Lam VP in Real Estate Developers Association of Hong Kong v Building Authority, HCMP 1746/2014, 27.5.2015 at §§18-19:

“18. Coming back to arguability, though there are authorities cited by Ms Cheng in which extension of time was granted without embarking on the merit of the intended appeal, we do not think it is right to do so in the present instance. If we do not see reasonable arguability in the arguments to be advanced or other good reasons for allowing the matter to go the Court of Final Appeal, we would not grant the requested extension. In that respect, we agree with Mr Yu that BA was not acting unreasonably in refusing to give the consent to a leap-frog appeal in light of the materials before them.

19. At the same time, we should not allow this application to become an occasion for counsel to rehearse substantially their arguments on the merits.  In this connection, we wholeheartedly endorse what was recently said by Moore-Bick LJ as Vice-President of English Court of Appeal in R (Hysaj) v Secretary of State of the Home Department [2014] EWCA Civ 1633 at paragraphs 46 and 47 in the context of the English rules:

“ 46.  If applications for extensions of time are allowed to develop into disputes about the merits of the substantive appeal, they will occupy a great deal of time and lead to the parties' incurring substantial costs.  In most cases the merits of the appeal will have little to do with whether it is appropriate to grant an extension of time.  Only in those cases where the court can see without much investigation that the grounds of appeal are either very strong or very weak will the merits have a significant part to play when it comes to balancing the various factors that have to be considered at stage three of the process.  In most cases the court should decline to embark on an investigation of the merits and firmly discourage argument directed to them.  Here too a robust exercise of the jurisdiction in relation to costs is appropriate in order to discourage those who would otherwise seek to impress the court with the strength of their cases. 

47.  Support for that conclusion can be found in the recent decision of the Supreme Court in HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd [2014] UKSC 64, in which the court had to consider the extent to which the merits of a claim or defence were relevant to granting relief from the sanction of striking out in default of compliance with an "unless" order.  Lord Neuberger, with whom Lord Sumption, Lord Hughes and Lord Hodge agreed, held that, even in a case of striking out, the merits of the claim or defence were relevant only when they were so strong that there was no real answer to them, in other words, in cases where an application for summary judgment could be expected to succeed.  In Lord Neuberger's view (paragraph 30):

“ ... it would be thoroughly undesirable if, every time the court was considering the imposition or enforcement of a sanction, it could be faced with the exercise of assessing the strength of the parties' respective cases: it would lead to such applications costing much more and taking up much more court time than they already do. It would thus be inherently undesirable and contrary to the aim of the Woolf and Jackson reforms.” ”

9.  In light of this authority, I should refrain from conducting a mini appeal hearing to make a detailed assessment of the merits of the intended appeal unless its merits or the lack of it are so obvious even without an in-depth enquiry.

10.  With these principles in mind, in particular, considering the exercise of my discretion as a matter of a multi-facet balancing process, I now turn to the application.

Length of and the purported reasons for the delay

11.  Mr Tam argues that the delay only started from the date of the Striking-Out Decision (6 March 2017) to the date of the Summons (20 June 2017). He submits that the delay in substance was not substantial.

12.  Mr Wong argues that the delay actually started from the date of the 1^st Notice of Motion (17August 2016), which did not even have a return day on it. The delay continued until the date of the Summons and Mr Wong submits that GECL could have applied for an extension of time to file a proper Notice of Motion in lieu of the 1^st Notice of Motion even before it was stuck out.

13.  I am unable to agree with Mr Wong. GECL now requires an extension of time to file its Notice of Motion. The necessity to file the same only arose when the 1^st Notice of Motion was struck out. Viewed realistically, the Notice of Motion could not have been filed when the 1^st Notice of Motion had not yet been struck out even if GECL had a dim view of its resistance to the striking out application. In any event, GECL would also require leave to file the Notice of Motion before the 1^st Notice of Motion was struck out and HHPFYML would also oppose on the ground of delay.

14.  Furthermore, however unsatisfactory the 1^st Notice of Motion was, and even if it could have been prosecuted more efficiently, I cannot accept that the delay started from the very date when the 1^st Notice of Motion was filed within the prescribed time period. Of course, I should not be taken to mean that the striking out of the 1^st Notice of Motion entitles GECL another period of 28 days to file its Notice of Motion. I fully appreciate the position of HHPFYML that the 1^st Notice of Motion should never have been filed and a proper Notice of Motion should have been filed within 28 days from the date of the Decisions. However, we are dealing with an altogether different delay here in this application.

15.  That does not mean that this court would ignore the historical facts and the overall delay. They are still relevant to my assessment as to whether the delay was excusable and whether prejudice was caused to HHPFYML. Given the failure of the 1^st Notice of Motion, GECL should be expected to act promptly to take the matter to finality so as to make up for the time wasted by the 1^st Notice of Motion.

16.  Thus, I conclude the delay in question was about 3.5 months. This was substantial in any view.

17.  I further hold that the delay was inexcusable notwithstanding the excuses proffered by Ms Chan of Messrs MM Wong & Co. (“MMW”), the current solicitors for GECL for the following reasons:

 (1) First of all, whilst it might take time to accept the Striking-Out Decision, GECL should be fully aware that the time of appealing against the Decisions had long lapsed and a fresh Notice of Motion must be taken out as a matter of extreme urgency.

 (2) Even on its own evidence, GECL only contacted MMW on 21 March 2017, more than 2 weeks after the Striking-Out Decision was handed down. The deficiency of the 1^st Notice of Motion should be very apparent to GECL by the time when the striking out application was heard in mid December 2016 and whether it could eventually survive the striking out application, it should have reviewed its position and considered whether to obtain second opinion. GECL should not have waited until 21 March 2017 to finalize its decision to engage MMW.

 (3) GECL now seeks to explain away the 3.5 months’ delay by highlighting its necessity to obtain the case papers from its previous solicitors, Messrs Francis Kong & Co. (“FK”) after payment of the outstanding legal costs and the time taken by MMW in their preparation of the intended appeal after having received a large number of papers. I am not convinced at all.

 (4) I accept Mr Wong’s submission that GECL could and should have obtained the relevant documents from the Trade Marks Registry in respect of the invalidation proceedings. The Decisions are in the public domain and have all along been available online. There is no reason why MMW should have waited for the return of the papers to start working on the Notice of Motion. I cannot understand how GECL could have allowed MMW to take almost 3 months to prepare the present application.

 (5) Further, as rightly pointed out by Mr Wong, in any event a change of legal representation involving a transfer of documents does not constitute a good reason for the delay: Tsang Wai Fan v Hui Siu Kwong, unreported, HCMP 1365/2010, 16.8.2010 at §23 per Chu JA; Po Fat Construction Co Ltd v Incorporated Owners of Kin Sang Estate, unreported, HCCT 15/2013, 6.11.2013 at §18 per Mimmie Chan J.

 (6) There is no merit in Mr Tam’s submission that the time limit of 28 days is intended for legal advisers who already act for the intended appellant, i.e. legal advisers who were already familiar with the case and already have some idea about the potential grounds of appeal. The time limit is for all intended appellants, including both those who are legally represented and those acting in persons. If the submission were correct, one could easily obtain an extension of time by changing his legal teams whenever the time limit is about to expire. This does not make sense at all. 

18.  Curiously enough, in one breath GECL asks this court to disregard the delay caused by the 1^st Notice of Motion, but in another breath it complains about the incompetence of its previous legal team (including FK and its former counsel) in their handling of its appeal against the Decisions by the defective 1^st Notice of Motion. In this regard, GECL relies on the affirmation evidence of Ms Chan. Ms Chan repeatedly asserts that the previous legal representatives had acted inexcusably.

19.  Since the delay caused by the 1^st Notice of Motion is not in focus, I shall only dispose of this complaint briefly.

20.  In the first place, I agree with Mr Wong that GECL should not have made such serious allegations through Ms Chan. Whilst Ms Chan might make her own observations on the defects of the 1^st Notice of Motion and the proprietary of the subsequent steps taken by GECL in the previous proceedings from her professional point of view, she should not be in a position to say that GECL had not been properly advised. There is no evidence that she has ever conducted any independent investigation into what had transpired between GECL and its former legal representatives. She could not have been fully informed of the true and complete picture unless all their communications have been made available to her.

21.  Ms Chan should not allow herself to be the mouthpiece of GECL particularly in making such grave accusations against fellow members of the profession. GECL now conveniently attempts to shift the blame to its previous legal representatives without having committed itself by verifying all the allegations against them on oath. Quite apart from arousing any sympathy, such accusations would only turn this court against GECL.

22.  In conclusion, I do not accept that the reason for the delay was all due to the former legal representatives of GECL. Nor do I find the delay to be excusable. I shall proceed to consider two other contentions of HHPFYML.

Public interest

23.  Mr Wong makes two submissions based on public interest. In the wake of the Decisions, the Registrar soon rectified the register to show that the Registrations had been invalidated. Mr Wong submits that the public, particularly rival traders, will be entitled to rely on such information to decide on their own legal position regarding any potential liability arising from the use of any of their trade marks. Thus, he submits that any extension of time given to GECL to appeal against the Decisions months after the register has been rectified would be against public interest.

24.  I am not convinced by this submission. Any reliance on the register by the general public should not possibly justify the deprivation of the right to appeal and the associated rights of the proprietors whose marks were invalidated. Mr Wong submits that it is understood to be the practice of the Registrar to only publish the invalidation or revocation of a registered mark on the Register upon the expiry of the appeal period. I do not have such an understanding and in any event such invalidation or revocation decisions will be published online as soon as they are available and invalidation and revocation are meant to take immediate effect. In those circumstances, any rival traders cannot possibly rely on such decisions when it may not be a matter of months if not years that any appeals against such decisions can be determined finally.

25.  Moreover, HHPFYML cannot really be heard to say that other traders would be prejudiced by an extension of time to appeal against the Decisions given its primary position that the use of the marks in the Registrations (“the Marks”) constitutes the tort of passing off and that the Registrations were made in bad faith.  

26.  Next, Mr Wong submits that it is in the public interest that there should be finality of trade mark dispute at an early date. He relies on “COFFEEMIX” Trade Mark [1998] RPC 717 for the proposition that in the context of a trade mark application, this is important not only to the applicant but also in the wider public interest so that the interested public may know at an early date the extent to which a monopoly by way of trade mark rights are to be granted to rival traders.   

27.  The “COFFEEMIX” case concerned a right to appeal from the decisions of the Registrar to the Appointed Person within the meaning of the Trade Mark Act 1994 and no further appeal lies from his decisions. Thus, finality at an early date of a trade mark dispute can be ensured by a quick and cheap method. Here, the mechanism is different and decisions of the Registrar are amenable to challenges by the normal court procedure.  I do not think that an extension of time to appeal against a decision of the Registrar is inherently against public interest.

Prejudice caused to HHPFYML

28.  Next I consider the allegations of prejudice that would be caused to HHPFYML if I allow an extension of time. Mr Wong makes a few points on the evidence adduced by HHPFYML. I must say I am not convinced.

29.  First, HHPFYML relies on a distributorship agreement dated 6 December 2016 in which it provided an indemnity to its distributor that HHPFYML would indemnify and hold the distributor free and harmless from loss, damage, liability, cost and expense if the marks of HHPFYML or other intellectual property infringe the rights of third parties. It says it agreed to provide such an indemnity because of the Decisions.

30.  The position of HHPFYML is that it has long used their marks bearing the name of Gan Geok Eng (“GGE”) and his portrait. There is no evidence that the marks of HHPFYML used in relation to the products under the distributorship agreement had been altered to include the name of GGE and his portrait in light of the Decisions. Such an indemnity is commonplace in distributorship agreements indeed.

31.  It should also be noted that the striking out application was yet to be heard when the distributorship agreement was signed and there was every possibility that GECL could have taken steps to salvage the 1^st Notice of Motion so as to keep its appeal against the Decisions alive.  If HHPFYML has all along been confident of the merits of its invalidation applications and hence the soundness of the Decisions, there is no reason why an appeal against the Decisions would prejudice its position.

32.  I believe that the indemnity clause was added out of ordinary commercial consideration and not because of the Decisions.

33.  By the same token, I am not convinced that the course of the business of HHPFYML has ever been altered in reliance of the Decisions. In particular, the mention of GGE and the publication of his portrait in the promotional book could hardly be said to a trademark infringement and I am far from persuaded that but for the Decisions, HHPFYML would not have included the same in its promotional book.

34.  Lastly, HHPFYML relies on its two trade mark applications which are being opposed by GECL. The two applications were in fact filed on 30 August 2011 and the Registrar examined them and eventually accepted them. Pursuant to section 43 of the Trade Marks Ordinance, Cap. 559 (“TMO”), the Registrar published the particulars of the applications on 26 May 2017.

35.  There is no evidence that the Registrar would revoke his acceptance of the applications if GECL could now proceed with its appeal against the Decisions despite the striking out of the 1^st Notice of Appeal. The applications have already entered into the opposition stage and GECL filed its notice of opposition on 25 August 2017. With or without the Decisions and the Registrations, the opposition proceedings would be continued and I fail to see how the position of HHPFYML is prejudiced if GECL is now allowed to appeal against the Decisions.

36.  I therefore come to the conclusion that HHPFYML did not suffer any tangible prejudice as a result of the delay. But this alone is not determinative: see The Real Estate Developers Association of Hong Kong, supra, at §16.

Merits of the intended appeal

37.  Having concluded that the delay was substantial and inexcusable, I would require GECL to show a real prospect of success on merits without much investigation. 

38.  Before I turn to the proposed grounds of appeal, it is apposite to find out the true nature of the intended appeals against the Decisions. Mr Tam submits that the appeals are by way of rehearing relying on O. 55 r.3(1) of the Rules of the High Court.

39.  Mr Wong helpfully refers this court to the decision of DHCJ Manzoni SC in Capital Dynamics Sdn Bhd v Capital Dynamics Holding AG, unreported, HCMP 2572/2014, 5.6.2015. There, the deputy judge made a summary of the correct approach after reviewing the relevant authorities in the following terms at §§12-15:

“12. The correct approach to an appeal of this nature is set in the judgment of Sakhrani J in Host Hotels and Resorts LP v Registrar of Trade Marks [2010] 1 HKLRD 541, which in turn cites various UK and Hong Kong decisions which identify the approach.

13. The court should interfere with registrar’s decision only where it is satisfied that the registrar acted on some wrong principle, such as approaching the problem incorrectly, taking into consideration matters which should not have been taken into consideration or omitting to take into consideration matters should have been considered — see Terumo KK v Beecham Group Plc [1994] AIPR 306. That, it seems to me, is a threshold test which must be satisfied before the court should thereafter engage upon the underlying merits of the decision.

14. Once that test has been satisfied the court must then address the merits of the decision of the registrar, and it should do so by way of a rehearing rather than by way of a review. In that rehearing the court should be slow to reverse the decision of an experienced registrar on a question which consists largely of a value judgment. Naturally in the event that the error of principle which, by that stage, the court has already identified affects a value judgment of the registrar, that value judgment will have to be revisited and made again without the error of principle. However if a value judgment is not vitiated by the error in principle then the court should show a “real reluctance” to interfere with it. This was identified by Robert Walker LJ in Reef Trade77 Mark [2003] RPC 5 at 28 as follows:

“… An appellate court should in my view show a real reluctance, but not the very highest degree of reluctance, to interfere in the absence of a distinct and material error of principle.”

15. In the context of Hong Kong, it was re‑affirmed by Rogers VP in Re NAKED [2010] 1 HKLRD 382 at 22:

“In my view, the correct approach is that the registrar’s opinion has to be fully and carefully considered.  The registrar has very particular experience.  Any departure from the way in which the registrar exercised his discretion has to be made on a sound basis after giving full and most careful consideration to the registrar’s views and reasons.  The exercise of discretion by the registrar should not be overruled simply because the court itself might have come to a different conclusion.  Essentially, therefore, a similar approach should be taken to the exercise of discretion by the registrar as by a judge.”

40.  I shall examine the merits of the proposed grounds with the adoption of this approach, which I accept to be the correct one. Before doing so, it is necessary to give a basic outline of the facts found by the Registrar in the Decisions.

41.  In each of the Marks, the portrait and the name of GGE form a prominent mark. GGE founded the business of HHPFYML in the trade of its Pak Fah Yeow products (medical balms) in the 1920s. GGE sold his business to HHPFYML by way of a contract (“the Contract”) whereby he undertook not to use his own name for purposes other than the patented medicinal products of HHPFYML.

42.  From the 1960s to the material times, HHPFYML has always included the name and the portrait of GGE in the instruction leaflets inserted into the packaging of its Pak Fah Yeow products.

43.  After the death of GGE in 1981, HHPFYML has continued to use his name and portrait in the promotion of the Pak Fah Yeow products in various medium from 1986 until 2006.

44.  Gan Hock Seng (“GHS”), the son of GGE, has been in charge of the business of GECL. He on behalf of GECL undertook in 1992 and 1993 that it would not sell the Pak Fah Yeow products supplied by HHPFYML outside Taiwan.

45.  The Marks were registered in Taiwan and in many other countries including Mainland China, Japan, USA, Canada and Vietnam and GHS/GECL is the proprietor of such registrations. 

46.  The Registrar found that GHS was aware of the Contract and that the name and the portrait of GGE were an important mark for the business of HHPFYML in Hong Kong. Nevertheless, GHS proceeded to register the Marks in an attempt to obtain a monopoly over the use of the name and the portrait of GGE to the detriment of HHPFYML. The material date for the purpose of the invalidation proceedings is 12 May 2010.

47.  The Registrar further found that GHS intended to mislead the public by the use of the Marks featuring the name and the portrait of GGE into thinking that the products of GECL were related to or connected with the business of HHPFYML so as to enhance the sale of his products.

48.  In the premises, the Registrar is satisfied that the use of the Marks would be an act of dishonesty on the part of GHS and/or GECL.  It is further concluded that the Registrations were made in bad faith and hence should be invalidated.

49.  Mr Tam puts forth the following four grounds of appeal on behalf of GECL:

(1) Ground 1: HHPFYML did not even use the name and the portrait of GGE as a trade mark or as a mark of HHPFYML’s business.

(2) Ground 2: The Registrar misapplied the standard of proof in finding that GECL registered the Marks in bad faith;

(3) Ground 3: The Registrar misapplied the burden of proof in finding that GECL register the Marks in bad faith; and

(4) Ground 4: The Registrar failed to direct cross-examination of the parties.

Ground 1

50.  Mr Tam heavily relies on the fact that HHPFYML had long neglected to register the name or the portrait of GGE as its trade marks. He also complains about the fact that the name and the portrait of GGE only appeared in the instruction leaflets and submits that they cannot be a trade mark within the meaning of the TMO.

51.  Indeed, Mr Tam advances a number of arguments in support of this ground. I do not find it necessary to deal with all of them though the answers to such arguments are quite apparent.

52.  I accept that the submission of Mr Wong that essentially Mr Tam is launching a number of attacks on the findings of fact. Absent any error of law shown, the Registrar is entitled to make such findings on the evidence and an appellant court would not interfere with such findings lightly. Suffice it to say, I am not convinced that this ground has any substance.

Grounds 2 and 3 

53.  These two grounds can be dealt with together and they concern the burden of proof and the standard of proof relating to the finding of bad faith.

54.  Though dressed up as a fundamental error in law with the allegations of the misapplication of the burden of proof and the standard of proof, Mr Tam basically complains about the insufficiency of evidence to support the finding of bad faith by the Registrar.

55.  In the first place, the Registrar correctly applied the established principles on bad faith in the Decisions. Mr Tam has failed to show how the Registrar erred and departed from such established principles. I do not accept the test on dishonesty expounded in Ivey v Genting Casino (UK) Ltd t/a Crockfords [2017] UKSC 67 materially deviates from the established principles commonly applied in Hong Kong. On the facts as unassailably found by the Registrar and having rejected the explanations of GHS, the Registrar was perfectly entitled to draw an inference of bad faith.

56.  For those matters allegedly not considered or given sufficient weigh by the Registrar, indeed, as pointed out by Mr Wong, the Registrar did take them into account as shown in the Decisions and I can detect no error of law committed by the Registrar.

57.  Accordingly I can conclude that these two grounds are devoid of merits.

Ground 4

58.  It is submitted on behalf of GECL that the Registrar ought to have directed cross-examination against GHS before making any finding of bad faith against him. This is particularly so given the gravity of the allegation.

59.  As fairly accepted by Mr Tam, cross examination is not mandatory in making a finding of dishonesty in hearings before the Trade Marks Registry: Brutt Trade Marks [2007] R.P.C 462. The allegation of bad faith is plainly a ground relied on in the invalidation proceedings and the parties served sequentially their affirmation evidence. They have been given sufficient opportunity to make and deal with the allegation of bad faith on paper.

60.  In the present case, neither party applied for cross examination. There was no need for HHPFYML to put the allegations again to GHS in cross examination. Nor was it necessary for GHS to repeat his answers to such allegations in cross examination. There was no application to adduce further evidence to deal with such allegations. As pointed out by Mr Richard Arnold QC in Brutt Trade Marks, the courts in most civil law jurisdictions consider themselves perfectly well to make findings that parties have acted in bad faith without the benefit of cross examination. I have no reason to doubt the ability of the Registrar to do so.

61.  I therefore conclude that this ground does not have any merits. GECL has shown no real prospect of success of its intended appeal.

Conclusion and order

62.  In this multi-facet balancing process, I have taken into account all the circumstances of the present case. I have come to the conclusion that the delay was both substantial and inexcusable. Whilst I am not satisfied that an extension of time would cause prejudice to HHPFYML, GECL has failed to show a real prospect of success on merits. Having looked at the matter in the round, despite the able submissions of Mr Tam, I am driven to the conclusion that I should not exercise my discretion in favour of GECL and should refuse to grant the extension of time sought.

63.  In the premises, I dismiss the Summons. Costs should follow the event. I would make an order nisi that costs of and occasioned by the Summons (including all costs previously reserved) be to HHPFYML, to be taxed if not agreed.

64.  Lastly, I thank both Mr Tam and Mr Wong for their assistance rendered to this court.