Businesses strive to stand out and build consumer trust. However, when one party attempts to trade on the reputation of another, passing-off provides a powerful common law remedy. The doctrine aims to prevent dishonest competition that causes confusion in the marketplace and undermines established goodwill.
The Essence of Passing-Off
Passing-off arises when a trader misrepresents their goods or services, whether intentionally or not, as being those of another, or as being associated with another business. The Supreme Court of Appeal in Adidas AG v Pepkor Retail Limited (187/12) [2013] ZASCA 3 affirmed that passing-off protects a trader from deception or confusion that damages or misappropriates goodwill.
Such misrepresentation is wrongful because it results in the improper exploitation of another's trade reputation or the dilution of their established business identity.
Two Core Elements: Reputation and Likelihood of Confusion
A successful passing-off claim requires two essential components:
- " Reputation: The claimant must show that the public associates a particular feature – whether a mark, name, packaging, or product design -with their business.
- " Likelihood of Confusion or Deception: There must be a real possibility that the public may be misled into believing that the offending goods or services originate from or are connected to the claimant.
As established in Caterham Car Sales & Coachworks Ltd v Birkin Cars (Pty) Ltd 1998 (3) SA 938 (SCA), the cause of action rests on the "classic triumvirate" of reputation, misrepresentation, and resulting damage. The plaintiff in a passing-off case must clearly show that their goods have built up a reputation or goodwill in the minds of the public in the relevant market, and that the confusion arises because of this association.
Proving Reputation: Use, Recognition, and Distinctiveness
To establish reputation, a claimant must demonstrate that the relevant public identifies a specific feature with the origin of the goods or services. The requirement of distinctiveness was clarified in Bress Designs (Pty) Ltd v GY Lounge Suite Manufacturers (Pty) Ltd 1991 (2) SA 455 (W), where it was held that the feature must hold meaning in the minds of consumers.
In Cambridge Plan AG v Moore 1987 (4) SA 821 (D), the court acknowledged that reputation can be inferred from consistent and widespread use of a product or get-up. The scale, visibility, and longevity of a feature's use in commerce can, in appropriate cases, suffice to prove that it has become distinctive.
The courts do not require formal registration or exclusive use to establish reputation. Instead, the test is whether a substantial number of consumers in the relevant market associate the feature with a single source.
Assessing the Likelihood of Confusion
The second component of passing-off focuses on whether the ordinary consumer is likely to be misled by the similarities between the parties' offerings. The inquiry is factual and centres on the general impression created by the respective get-ups.
Courts adopt the perspective of the notional "average customer." In Blue Lion Manufacturing (Pty) Ltd v National Brands Ltd 2001 (3) SA 884 (SCA), this purchaser was described as someone with a general idea of what they want, but not an exact recollection or capacity to distinguish fine details. The court emphasised that such a consumer may not have the benefit of comparing products side by side or examining them with forensic precision.
The "first impression" standard remains central. As the court stated in Plascon-Evans Paints v Van Riebeck Paints 1984 (3) SA 620 (AD), the likelihood of confusion must be evaluated based on how the goods appear when initially encountered.
Contextual Factors and the Purchaser's Conduct
The circumstances in which goods are marketed and purchased also play a significant role in determining the likelihood of confusion. In Reckitt & Colman SA (Pty) Ltd v SC Johnson & Son (SA) (Pty) Ltd 1993 (2) SA 307 (A), the court considered the nature of the goods, the consumer base, and the marketing channels.
Limits of Protection: Imitation Versus Misrepresentation
While the law guards against deception, it does not outlaw all forms of imitation. The Supreme Court of Appeal in Dart Industries Inc v Botle Buhle Brands (Pty) Ltd [2022] ZASCA 170 highlighted that passing-off is not intended to confer a monopoly over successful get-ups. Competitors may adopt similar styles or formats, provided they make it sufficiently clear that their products are not those of another trader.
The key is to ensure that no actionable misrepresentation occurs.
Passing-off remains a powerful tool in the South African legal framework to protect trade reputation and consumer clarity. Claimants must, however, be prepared to demonstrate that their product features have become distinctive in the minds of the public and that the alleged infringer's conduct creates a real likelihood of confusion. The analysis requires a careful understanding of consumer behaviour, product context, and judicial precedent. Passing-off will continue to play a critical role in demarcating the fine line between fair competition and unlawful appropriation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
