Coloroll Limited [1986] NZIPOPAT 7 (15 September 1986)

Last Updated: 7 August 2009

IN THE PATENT OFFICE

NEW ZEALAND
PATENTS DIVISION

IN THE MATTER of the Patents Act 1953

AND

IN THE MATTER of a void application for Letters Patent numbered 197944 in the name of COLOROLL
LIMITED of 54 Jermyn Street, London SW1Y 6LS, England,

(APPLICANT)

AND

IN THE MATTER of an application under s.37 for the restoration of the said application.

Hearing: 26 August 1986

Miss M. Doucas for the Applicant.

DECISION OF THE ASSISTANT COMMISSIONER OF PATENTS

The application in suit was filed as a convention application on 5 August 1981 , claiming priority from an
application for protection made in the United Kingdom on 6 August 1980. The time set by operation of
s.19(1), in the absence of any other factor, would have expired on 5 November 1982 .

In an Official letter dated 14 July 1982, three matters were raised by way of formalities objections, none
of which posed any great problem of rectification to the applicant. A reminder letter was issued on 18
October 1982, but there was no response. An Official letter of 28 February 1983, and a subsequent form
letter of 1 March 1983, both advised that the application had been marked off as void. I point out that
neither communication did more than confirm the state that had in fact existed since 5 November 1982. A
file note records that a telephone message from Mrs Burke of Henry Hughes Limited on 1 November
1982 was to the effect that the application was to be allowed to lapse. This message was received four
days before the case did in fact become void pursuant to the provision of s.19(1).

The next activity was a letter of 3 March 1983 from Henry Hughes Limited in response to the void
notices. This letter points out that the Official letter of 14 July 1982 did not set a time for resolution of the
objections. This is correct, but it does not explain why there was no action in response, and it does not
mention or explain the telephone message of 1 November 1982 that the case was to lapse. An official
letter of 19 May 1983 in reply points out that a reminder letter had been despatched, and the telephone
message of 1 November 1982 is mentioned as a matter relevant to the position of the application.

The next activity was the filing of an application for restoration under s.37 on 27 November 1984. I note
that there was a delay of 21 months from the letter of 28 February 1983 stating the case to be void and the
filing of the restoration application on 27 November 1984. Certain documents relating to the outstanding
objections were filed with the application, but
no evidence in support. Reg 95(2) allows three months from the date of the application for the filing of
evidence. The lack of evidence was drawn to the applicant's attention by a letter of 5 December 1984.
Reminder letters were issued on 5 June 1985 and 7 August 1985.
A letter of 14 August 1985 advised that the Henry Hughes Limited file had been mislaid, and until the file
was found, or replacement documents obtained, there would be further delays in filing evidence.

The evidence, comprising a statutory declaration by Margaret Doucas , and an affidavit by Michael John
Daley , together with an authorisation of agent, was filed on 10 January 1986. I note that there was a 13
month delay in the filing of the evidence in support. I further note that the evidence is deficient in certain
respects. The exhibits referred to in the declaration by Miss Doucas are missing, the exhibit notes to Mr
Daley's affidavit are not correctly executed, and it would appear that the requirements of Reg 143 may not
have been observed.

On 17 January 1986, I issued a five-page letter setting out the facts as derived from the file, and the
evidence filed, and giving consideration to the issues of intention of the applicant, and delay relative to
the making and prosecution of the application for restoration. I reached the conclusion that neither the
matter of intention nor the matter of delay had been explained or established to my satisfaction. I advised
that the provision of Reg 96(1) applied.

Regulation 96(1) reads:

"If upon consideration of the evidence the Commissioner is not satisfied that a prima facie case for an
order under section 37 of the Act has been made out, he shall notify the applicant accordingly; and unless
within one month from the notification the applicant requests to be heard in the matter, the Commissioner
shall refuse the application."

A request to be heard was made in a letter dated 26 May 1986, following a series of requests for
extensions of time for this purpose, on Form 76. By letter of 1 August 1986, I set the matter down for
hearing on 26 August 1986.

Where an applicant has not complied with all the requirements imposed on him by or under the Act
within the time prescribed by s.19, or any extension thereof granted, and the application has accordingly
become void, the applicant may apply to the Commissioner for an order restoring the application under
s.37(1). Subsection (2) requires the applicant to file a statement of the circumstances which led to the
failure to comply with the said requirements.

Subsection (3) of s.37 reads:

"If it appears from that statement that any omission on the part of the applicant was unintentional and that
no undue delay has occurred in the making of the application, the Commissioner shall advertise the
application and within such period as may be prescribed any person may give notice of opposition at the
Patent Office."

The Act requires me to be satisfied upon two matters before the application can proceed to advertisement.
They are respectively, the intention of the applicant, and the matter of delay in the making of the
application.

Delay
As set out above, there was a delay of 21 months from the issuing of the letter of 28 February 1983 stating
the application to be void, and the filing of the application under s.37 on 27 November 1984. In fact the
true delay was longer, since the application became void pursuant to the provision of s.19(1) on 5
November 1982. This was a fact clearly known to the duly authorised agent for the applicant, and, it must
be assumed, to the applicant. The delay was therefore in excess of two years on this reasoning. The
question then becomes, is this "undue delay"? I have no doubt that it is undue delay. Even on the best case
of 21 months delay, the applicant cannot plead ignorance of the situation, since it is a matter of record that
the agent was aware of the situation (letter of 3 March 1983).

In the matter of an application by Owens-Illinois, Inc ., for the restoration of void application No.169,174,
I considered the question of "undue delay" in relation to s.37 applications, and at page 7 held that there is
close equivalence between s.35 and s.37 on the matters of intention and undue delay . In my opinion the
case law on the meaning of undue delay in connection with our s.35 or its English equivalent (s.27 of the
now repealed Patents Act 1949) is, or may be, of assistance in s.37 applications. An English case
discussed in that decision is Salopian Engineers Ltd's Application [1957] R.P.C. 351 where the matter of
undue delay is discussed in relation to the duty on a patentee to exercise ordinary and reasonable care in
the maintenance of a patent by the payment of renewal fees when due. In the present situation, the
element of care seems lacking, and may be related to intention to be considered and discussed later.

A significant difference between the provisions of s.35 and s.37 with respect to undue delay, is that s.35
requires that there be no undue delay

"... in the making or prosecution of the application ..."

(emphasis added)

whereas in s.37 there is no mention of delay with respect to prosecution. Section 37 being a section with
no counterpart in the U.K. Patents Act 1949, now repealed, there is no English case law guidance on
whether prosecution delay is a factor to be taken into consideration. In view of the specific time limits set
by s.19(1) to ensure that finality is reached on patent applications, and the specific reference to s.19 in
subsection one of s.37, I think it is a reasonable inference that excessive prosecution delay is a factor to be
taken into account when considering whether the applicant has presented a prima facie case in terms of
Reg 96(1). In my opinion a thirteen month delay in the filing of evidence in support is an excessive
prosecution delay in the circumstances of an application upon which it is sought to resume prosecution.

At the hearing, Miss Doucas argued against my reasoning in the Owens-Illinois case, pointing out that
sections 35 and 37 had distinctly different wording, as I have indicated above. Miss Doucas emphasised
the absence of any mention of "prosecution" delay in s.37. She is of course perfectly correct, but against
this must be set the fact that we are considering a pre-acceptance proceeding, and in pre-acceptance
proceedings, strict time limits are imposed upon the applicant by s.19(1). Our practice is to modify those
strict time limits by use of the provision of s.93(1) to compensate for delays in the Patent Office. The
intended effect of our use of s.93(1) is to give all applicants an equal amount of time to put their
applications in order for acceptance, regardless of variable delays in commencing technical examination
caused by sectional staffing problems in the Patent Office. As I see it, s.19(1) still governs the situation,
albeit modified in the interest of fairness by s.93(1). I note the provision of s.37(1), which reads:

"37. Restoration of application where complete specification not accepted - (1) Where an applicant has
not complied with all the requirements imposed on him by or under this Act within the period prescribed
by section 19 of this Act, or within any extension of the period granted by the Commissioner under that
section or under section 93 of this Act, and the application has accordingly become void, the applicant
may apply to the Commissioner in the prescribed manner for an order restoring the application and
extending the period for complying with the requirements imposed on the applicant by or under this Act
to such date as may be specified in that behalf in the order."

It is clear that one effect of an order restoring the application under s.37 is to extend the period of time
allowed for complying with the requirements imposed on the applicant, by or under the Act to a date
specified for that purpose in the order. In other words, the act of restoration results in a new time
constraint being placed upon the applicant, as there formerly was under s.19(1). As I see the matter, the
question of prosecution delay under s.37 is of considerable importance when the section is considered in
the context of the Act. It does not seem sensible to me to suggest that an applicant, subject to strict time
limits before the application went void, and to a strict time limit as specified in the order, when and if the
application is restored, is entitled to procrastinate in the prosecution of the restoration proceedings per se.
My view of the difference in wording between s.35 and s.37 is that it seems almost axiomatic that
prosecution of a s.37 application for restoration must proceed with all speed.

Miss Doucas pointed to paragraph (j) of s.21(1) which makes it a ground of opposition to grant, that
where there has been an order under s.37,

“...,there was undue delay in applying for the order."

and noted that again there is no mention of prosecution delay, only undue delay in the making of the
application. I concede that this could be interpreted as supporting Miss Doucas' position, but on a
balanced view, I think it does not assist her case.

At the hearing, Miss Doucas sought leave to file further evidence by way of a further statutory declaration
by herself. I agreed that I would receive this evidence, there being no other party to be disadvantaged by
the late filing thereof.

At paragraph 5, Miss Doucas confirms the loss of the Henry Hughes Limited file with all material up to
and including a letter from Mr Daley, the U.K. instructing associate, dated 18 June 1985. Mr Daley was
advised of this circumstance by telex of 13 August 1985. The original file was found, misfiled, in early
1986.

At paragraph 7, Miss Doucas states that the official letters of 14 July 1982, 18 October 1982 and 28
February 1983 were received and filed. She observes that no date for compliance with the objections was
stated, and that since eleven months had passed since filing, it appeared an appropriate case for an
extension under s.93(1). As I understand the matter, formal requirements should be met by the applicant
before expiry of the original time set by s.19(1), particularly when the applicant is advised of deficiencies
before that date, as in this case. I do not regard the omission of a compliance date for the objections raised
on 14 July 1982 as a serious omission on our part, particularly in view of the established practice, and the
well known statutory time limitation of s.19(1).

With reference to the void notice, Miss Doucas states that as she believed at that time that the application
was to be abandoned, she did not pursue the matter further.

At paragraph 8, Miss Doucas states that she did not advise F.J. Cleveland & Co., the U.K. firm instructing
her, that the application had become void because of the instructions received up to that date. At
paragraphs 9 and 10, Miss Doucas confirms that no trace of receipt of the telex reversing the "abandon"
instruction can be found.

Considering this situation, with the wisdom of hindsight, it appears that a crucial omission by Miss
Doucas was that she did not report that the application had become void to her instructing associate. If
this had been done, it would have alerted the instructing associate to the fact that the telex of 16 June
1982 from Mr Daley of F.J. Cleveland & Co to Henry Hughes Limited, reversing the instruction to
abandon, had gone astray. While Mr Daley quotes the exact text of this telex in his letter of 22 June 1982
(dictated 16 June 1982), in his affidavit at paragraph 3 he states that telex despatch records are not kept
for more than 12 or 18 months, and so he is unable to produce the original message.

In my letter of 17 January 1986 at page 5, I state, inaccurately as it now appears, that neither Mr Daley
nor his new principal were concerned enough to enquire about the fate of the application between June
1982 and November 1984. I note that Mr Daley enquired of Henry Hughes Limited about the fate of the
application by letter of 4 April 1984, received on 10 April 1984, as recorded by Miss Doucas in her first
declaration at paragraph 5.

Miss Doucas replied to Mr Daley on 11 April 1984 (Exhibit MD2 of her second declaration), and I
assume, in the absence of evidence to the contrary, that he would have received this letter by late April.
This illuminates the important point that while the delay in enquiring was not as long as I had earlier
attributed to the instructing associate, there was a delay in making the application for restoration from
(late) April 1984 to 26 November 1984, a delay not satisfactorily explained by the evidence, or the
submissions. In the circumstances, is this delay of approximately seven months
"undue delay ... in the making of the application"?

In the matter of an application under s.35 by G.B. Powell and Company Limited for the restoration of
New Zealand Patent No.113,268, the Commissioner of Patents, Mr A.D. McGregor, held that a delay
from 25 June 1964 to 7 December 1964 in filing the application for restoration was an undue delay, fatal
to the application.
The Powell case involved a delay of less than six months, s.35 requiring as a condition precedent to
restoration that no undue delay has occurred in the making of the application. My conclusion is that the
answer to the question is that the delay from late April 1984 to 27 November 1984 was undue delay
within the meaning of the section.

lt is my opinion that if Mr Daley (or his principal) had been monitoring the situation with care, he (or
they) should have become aware of the situation pertaining in New Zealand far earlier than he (or they)
did.

Further, I am of the opinion that there has been an unacceptable amount of prosecution delay, in that the
restoration proceedings have been in being from 27 November 1984, to the present.

Intention
In my letter of 17 January 1986, I concluded that the question of the applicant's intention had not been
established to my satisfaction. Miss Doucas was at some pains to displace this conclusion, and her
declaration handed in at the hearing quotes from a letter by Mr Daley dated 4 June 1986 where further
explanation of the circumstances surrounding the application is given.

Mr M.J. Daley is a partner in the firm of English Associates (F.J. Cleveland & Co.) instructing Henry
Hughes Limited.

Exhibit 1 of Mr Daley's affidavit is a letter dated 27 May 1982 from him to his principal confirming
instructions received by him to abandon "the" application. This letter makes the point to the addressee of,

"... the irrevocable nature of this course of action."

Mr Daley's exhibit 2 is a letter "despatched" on 22 June 1982 to the new beneficial owner of "the"
application. In it Mr Daley discusses various matters, most particularly European applications,
specifically the Dutch. There is no specific mention of New Zealand. Mr Daley's letter states that he has
sent a telex to all countries advising that the instruction of 27 May 1982 is reversed, and that the
applications are to proceed. The exact text of this telex is quoted in the letter. Mr Daley states that the
telex message was received in all of the 10 countries with the exception of New Zealand. His belief is that
the intention of the applicant to resume prosecution in New Zealand was transmitted to his New Zealand
associates.

It appears that the applicant company Coloroll Ltd came under the control of the financial concern
Charterhouse of Milk St, London in May 1982, and it was as a consequence of this situation that
instructions were issued to discontinue prosecution of certain cases, including the application in suit.
Subsequently, the application in suit (amongst others) was acquired by a company known as Ecological
Technical Enterprises (IOM) Limited, (Ecotec), headed by a Mr J. Bevans Giles. Mr Daley was instructed
by Mr Giles to "reinstate" the application (actually to resume prosecution), thus giving rise to the telexes
of 16 June 1982 mentioned earlier. In his paragraph 4, Mr Daley states that it is the beneficial owners of
the application (Ecotec) who now instruct him, and that it is and was their intention to proceed with the
application. He further states that it was his belief that the intention to resume prosecution had been
transmitted to his associates (Henry Hughes Limited).

In my letter of 17 January 1986, I stated that on a prima facie basis, Mr Daley's letter of 22 June 1982 did
appear to establish the intention of the new beneficial owner. But the question arises of why no steps were
taken by Mr Daley to record an assignment of the application to Ecotec, the new beneficial owner, in the
years following 22 June 1982, if Mr Daley believed the application still to be extant? The authorisation of
agent filed on 10 January 1986 is in the name of that firm, not at present the formal applicant. In my letter
of 17 January 1986, I observed that neither Mr Daley nor his new principal were sufficiently concerned to
enquire about the fate or status of the New Zealand application between June 1982 and November 1984.

This comment was inaccurate as mentioned earlier, in that Miss Doucas’ first declaration at paragraph 5
states that a letter dated 4 April 1984 from F.J. Cleveland & Co was received by Henry Hughes Ltd on 10
April 1984. This letter is not exhibited. The response of 11 April 1984 which was supposed to be
exhibited to her first declaration, but was not, is exhibited to her second declaration. That letter confirms
to Mr Daley that no further action was taken following the instruction of 15 June 1982, and that no
instructions had been received countermanding the instruction of 15 June 1982.

At paragraph 11 of her second declaration, Miss Doucas gives a series of quotations from a letter dated 4
June 1986 sent to her by Mr Daley. Before considering the quotations from Mr Daley's letter, I observe
that this material is probably hearsay evidence, and not admissible. Mr Daley's letter should have been
exhibited in full, to a declaration by Miss Doucas, or alternatively, and perhaps preferably, Mr Daley
should have sworn a second affidavit. I understand that Miss Doucas followed the course that she did by
reason of time constraints.

The substance of Mr Daley's remarks record the history of the application, as set out earlier. He gives
further details about Mr Giles and his Ecotec company, and its relationship with F.J. Cleveland & Co. Mr
Daley states that the state of the enterprise was such that limited funds were available to spend upon the
"patent portfolio", and that the situation did not permit close monitoring of progress in ail countries. It
appears that the financial situation of Ecotec was the reason for no follow up until 1984.

While I have sympathy for the financial problems of the beneficial owners, the Act places certain duties
upon applicants, as earlier discussed. As I understand the matter, failure to observe the statutory
requirements cannot be excused on the grounds of financial stringency. Having said that, I am prepared to
concede that there was an intention to keep the application in suit alive, but this intention was in large part
nullified by the applicant's failure to pursue the matter to the extent necessary, and at the requisite pace. I
find that the applicant's intention has not been established to my satisfaction.

Decision
Pursuant to Reg 86(2), I decline to allow the application to proceed to advertisement and refuse the
application for restoration on the ground that there was undue delay in the making of the application for
restoration, and for the reason that I am not satisfied with regard to the applicant's intention.

Dated this 15th day of September 1986.

H. Burton
Assistant Commissioner of Patents
Henry Hughes Limited for Applicant.