Cases Calendar

 May 2022
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NAME DISPUTE:

COMAIR LIMITED (Applicant) vs KULULA HOLDINGS PROPRIETARY LIMITED (First Respondent) and COMPANIES AND INTELLECTUAL PROPERTY COMMISSION (CIPC) (Second Respondent)

The Applicant filed an application for default order as envisaged by regulation 153 of Companies Regulations, 2011. The Applicant sought an order that the First Respondent be directed to change its name as it does not satisfy the requirements of the Act when considered against Applicant’s trademark, KULULA. The Applicant asserted that the First Respondent’s name is confusingly similar to its trademark and/or is such as would reasonably mislead a person to believe incorrectly that the First Respondent is part of or associated with the Applicant. Furthermore, the Applicant sought an order directing the Second Respondent, to change the First Respondent’s name in the event of the latter failing to comply with the order of the Tribunal. Both respondents did not oppose the application.

The First Respondent was served by email on 3 December 2021 and later by the Sheriff. The Sheriff served the papers by affixing same to the principal door at the First Respondent’s registered office address on 8 December 2021. The CIPC was served by email also on 3 December 2021. The Tribunal was satisfied that the application was adequately served.

The Applicant is the proprietor of the trademark KULULA and other related trademarks. The trademark is registered in various classes covering a wide range of goods and services, beyond the conventional business of Comair: operating an airline. There is proof that the trademark registrations are valid and in force after being renewed a few years ago.

It was stated that the Applicant, although a South African company, conducts business across sub-Saharan Africa and the Indian Ocean islands. Its core business is offering scheduled and non-scheduled airline services. It has been in operation since 1946. Since 2001, the Applicant has been widely and extensively using its KULULA trademark in respect of its business as an airline under the trading style KULULA and KULULA.com. It has conducted prominent and very successful advertising campaigns on national radio and television, print media and outdoor billboards.

Furthermore, the Applicant has been recognized or honoured with various awards for its products and services over the years and its reputation has been rising in the industry and amongst its peers in Africa and beyond. It is a popular airline and services thousands of  passengers on a daily basis in South Africa. For example, for the financial year ended 30 June 2018, Kulula ferried 3 281 846 passengers. Through constant marketing and promotion, the name, trademark, goods and services of Comair under KULULA has established a substantial reputation and goodwill. It was therefore submitted that the trademark KULULA has become an asset of considerable value and importance to the Applicant. Therefore, any unauthorised use of the trademark or the use of confusingly similar marks or names damages the asset and the business of Comair in South Africa.

It was stated that between, May and December 2021, after the Applicant’s attorneys were instructed to object to the First Respondent’s name, there were various communications between the attorneys and the First Respondent’s sole director as an attempt at the amicable resolution of the matter, but to no avail. The First Respondent’s director, at some point, even

undertook to effect changes to the First Respondent’s name by acquiring a new compliant name with the CIPC. When the First Respondent’s director reported experiencing problems in the process towards the name change, the attorneys for Applicant offered to assist. These attempts at amicable resolution and assistance of the First Respondent to effect changes to its name even continued after the launch of this application, but again to no avail. It appears that, at some stage, the First Respondent’s director did not respond to communications from Comair’s attorneys.

Based on the available information on the First Respondent, the Tribunal’s view was the First Respondent was a start-up company. From the disclosure certificate filed by the Applicant, issued by the CIPC in November 2021, the First Respondent was registered on 28 April 2021. This was hardly a month before Applicant became aware of the existence of the First Respondent and roped in its attorneys of record to object to the name.

The Tribunal found that the First Respondent’s name “KULULA HOLDINGS” does not satisfy section 11(2)(b) of the Companies Act, due to the inclusion of the word “KULULA” in the name. The Tribunal agreed that the word “HOLDINGS” included in the First Respondent’s name, does not sufficiently distinguish the First Respondent from Applicant’s trademark. Regarding the request that a costs order be granted against the First Respondent, the Tribunal was disinclined to grant such an order. The First Respondent’s director appears to have chosen the name not with malice. He has offered his co-operation to make amends when the offence was brought to his attention.

Order:

a.  the First Respondent’s registered company name “KULULA HOLDINGS” does not satisfy the requirements of section 11(2)(b) of the Act;

b.  the First Respondent was directed to choose a new name and file a notice of amendment to its Memorandum of Incorporation;

c.  the First Respondent is directed to complete the activities ordered in b) hereof within two (2) months of service of this order upon the First Respondent in terms of regulation 153(3) of the Companies Regulations, 2011;

d.  in terms of the order in Comair Limited v Kulula South Africa (Pty) Ltd and others of the High Court of South Africa (Gauteng Division, Pretoria), Case Number 65895/2019 of May 2020 per Mbongwe AJ (as he then was), in the event the first respondent fails to comply with b) hereof within the period stated in c) hereof, the second respondent, the Companies and Intellectual Property Commission, (after receipt of a statement under oath on behalf of the applicant confirming such failure on the part of the First Respondent), is directed to substitute the first respondent’s registration number for the first respondent’s name KULULA HOLDINGS; and

e.  there was no order as to costs of this application.

 

Social and ethics committee

Centurion Home-Owners Association NPC (Applicant)

The Applicant applied to the Tribunal in terms of section 72(5)(b) of Act read with regulations 43(1)(c) and 43(2)(b) of the Companies Regulations, 2011 for an exemption from appointing a Social and Ethics Committee (SEC). The Applicant is registered in accordance with the Act, with registration number 1995/013780/08. The Chair of the Applicant Elefterios Piagalis, brought the application, was duly authorised to do it on behalf of the Applicant by a resolution of the board dated 11 February 2022.

The Applicant manages an estate and the members of the Applicant (have to) become members of the association due to ownership of property in the estate as provided for in articles 3.2.4 and 3.2.5 of the Memorandum of Incorporation (MoI) of the Applicant. For two consecutive years, the Applicants’ Public Interest Score (PIS) was above 500 i.e. 2020 (873) and 2021 (910). The Applicant stated that the major component of the PIS is the number of members in the Applicant, being 873.

The Applicant applied for an exemption from the appointment of an SEC on the basis that it is not reasonably necessary in the public interest to require it to have a social and ethics committee, having regard to the nature and extent of its activities. The PIS score for 2019 was the same as in 2020, which means that the Applicant should have a brought this application in 2021 as provided for in regulations 43(1)(c) and 43(2). There was no explanation for this omission. The essence of the application was that the Applicant solely does business as a home-owners association, for the benefit of and in the interests of its members. The membership and turnover (which consists of levies by the members) are “ring fenced”, therefore it is not reasonably necessary in the public interest to require the company to have a SEC.

It is the Tribunal’s view that the fact that one element of the PIS criteria takes a company over the PIS of 500 does not mean that the public interest dictates that it is not necessary to appoint an SEC and therefore it is not, on its own, sufficient as basis for an exemption. Furthermore, extent of the public interest element can therefore only be determined with reference to the qualitative criteria in regulation 43(5): see Henochsberg on the Companies Act 71 of 2008 at 284 et seq.

Order

The Applicant was exempted in terms of section 72(6) from appointing an SEC for a period of five years from the date of the decision based on the criteria stipulated in section 72(5)(b).

 

Annual general meeting

Denel SOC LTD (Applicant)

The Applicant filed an application in terms of Section 61 of the Companies Act 71 of 2008 (the Act) requesting an extension to hold its Annual General Meeting (AGM) more than the statutory 15 Months after the last AGM which was held on 29th January 2021. The Applicant is registered in terms of the company laws of the Republic of South Africa, under registration number 1992/001337/30. The application was brought by the Applicant’s Acting Group Chief Financial Officer Thandeka Sabela duly authorized by the Board of Directors to act on behalf of the company.

The Applicant submitted that they were not able to hold AGM as they were waiting for the finalization of its Annual Financial Statements. The delay was due to its going concerns and the uncertainty of government funding and inadequate resources to conclude the financial statements and audit.

The Tribunal was satisfied that good cause has been shown as to why the Applicant failed to hold its AGM within the statutory period required by the Act. Due to financial difficulties it was difficult for the applicant to have an AGM.

Order

The Applicant was granted an extension to hold its AGM before 31st October 2022.