Botanica Agriculture and Extraction Limited v Botanica Limited

This is my oral judgment following the hearing of an appeal by the Appellant, Botanica Agriculture and Extraction Ltd, against the decision of the Company Names Tribunal (the "Tribunal") for a change to the company name of the Respondent, Botanica Ltd, published on 9 November 2021 (the "Decision"). Neither company was represented by solicitors and counsel before the Tribunal. Before me, the Appellant was represented by Mr Sembu Gbla (a director) and the Respondent was represented by Mr Sandeep Singh Varaich and Mr Atul Sharma (both directors) and also by Ms Ravinder Varaich (Mr Varaich's sister).

On 12 May 2022 Sir Anthony Mann adjourned the hearing of this appeal to enable proper notice to be given to the Respondent and gave directions for service of the appeal bundle. He also directed that the Appellant's application to adduce new evidence in box 10 of the Appellant's Notice should be heard at the same time as the appeal. It is regrettable that it was necessary to adjourn the appeal and it does mean that it is now almost a year since the Tribunal's original decision.

I turn first to the application made by the Appellant to the Tribunal. On 17 April 2020 the Respondent was incorporated and registered under the name "Botanica Limited". On 29 September 2020 the Appellant made an application to the Tribunal under section 69 of the Companies Act, which provides as follows:

Mr Gbla did not include the Appellant's original application in the appeal bundle. Nevertheless, the Tribunal quoted it at some length and I take its contents (ignoring the typographical errors) from the Decision itself (which was not challenged in this respect). The Tribunal recorded that, in the application, Mr Gbla had requested that the individual directors, including both Mr Varaich and Mr Sharma, should be joined as additional Respondents. The Tribunal acceded to that request and they are therefore parties to this appeal. The Tribunal also recorded that the Appellant had stated that it had recently registered the name "Botanica Pharmaceutics Limited" because of the threat posed by the Respondent. In relation to the Appellant's goodwill or reputation the Tribunal also recorded the Appellant's case to be as follows:

The Tribunal continued that the Appellant had contended that its field of business was life sciences, pharmaceutical preparation and the cultivation of medicinal crops and also that it had objected to the Respondent's company name for a number of reasons. Before me, Mr Sharma and Mr Varaich took strong objection to the way that Mr Gbla had formulated his objections. For that reason, I quote them in full:

The Tribunal also recorded that the Applicant sought a range of relief but, primarily, that it wanted Botanica Ltd to be dissolved or instructed to change its name so that the other Respondents were not able to claim association with Mr Gbla's group of companies. In the Appellant's notice, Mr Gbla also sought aggravated damages for the damage done to the Appellant.

I turn next to the evidence in support of the Appellant’s application. The Tribunal summarised the evidence submitted by the Appellant in paragraphs 15 to 28 of the Decision. They recorded that the Appellant was incorporated on 11 November 2019 (approximately five months before the Respondent) and that Botanica Pharmaceutics Ltd had only been incorporated on 27 September 2020 (approximately five months after the Respondent's incorporation). The Tribunal also recorded that in January 2021 the Appellant's website which later used the identities "Botanica" and "Botanica MediCare" was under construction and that, although the Appellant had an Instagram account by 17 December 2020 in the name of "botanicamedicare", in his witness statement dated 30 March 2021, Mr Gbla had accepted that the domain name botanicamedicare.co.uk was no longer in use.

In paragraphs 17 to 23 the Tribunal referred to a number of exhibits which Mr Gbla had produced, all of which post-dated the Respondent's incorporation. In paragraphs 24 to 26 they then referred to an exchange between Mr Gbla and a senior lecturer at the University of Westminster, which showed that Mr Gbla was hoping to interest the university in a research project. In paragraph 32 the Tribunal set out the following chronology, to which Mr Gbla also referred me in his oral submissions:

I turn next to the Tribunal's reasons for the Decision. In paragraph 33, the Tribunal asked first what name the Appellant was relying on and concluded that it was relying on "Botanica Agriculture and Extraction Limited", i.e., the full name of the company shown in the application. The Tribunal then went on to consider whether the Appellant had the necessary goodwill or reputation at the date of the respondent's incorporation. They adopted the wide definition of "goodwill" which Lord Macnaghten had used in answering the following question in IRC v Muller & Co's Margarine Ltd [1901] AC 217:

Mr Gbla did not challenge this test and he was right not to do so since its adoption was in the Appellant's favour. The Tribunal members also directed themselves by reference to a number of trademark cases that it is well established that goodwill of more than a trivial nature is capable of protection. Again, Mr Gbla did not challenge this direction and, again, he was right not to do so because this test was also in the Appellant's favour. The Tribunal then set out their reasons for dismissing the application in paragraphs 36 to 41 (which I must quote in full):

Before I turn to the Grounds of Appeal, I make some observations about the application of section 69(1)(a). The Tribunal assumed in the Appellant's favour that Botanica Ltd was "the same as a name associated with the applicant". I would not necessarily have accepted that the names are the same. For example, in Zurich Insurance Co v Zurich Investments Ltd [2011] RPC 6 the Tribunal stated as follows at [37]:

In Zurich the Tribunal also relied on the decision of the Court of Appeal in Reed Executive plc v Reed Business Information Ltd [2004] EWCA Civ 159. If the members of the Tribunal had considered the decisions in Reed and Zurich and asked themselves whether "Botanica Agriculture and Extraction Limited" was the same name as "Botanica Limited" by comparing the words "Botanica Agriculture and Extraction" with the word "Botanica", I am not satisfied that they would necessarily have reached the conclusion that they were the same name. Moreover, I am not satisfied that they would have found the test in section 69(1)(b) to be satisfied either (and this is a point to which I will return below).

The Tribunal members also directed themselves that the relevant date for considering whether section 69(1)(a) was satisfied was the date of the Respondent's incorporation. In Zurich, however, the Tribunal stated that the relevant date was the date of the application: see [34]. The Tribunal also adopted the same approach in MB Inspection Ltd v Hi-Rope Ltd [2010] RPC 18 at [43]:

It may be that the Tribunal thought that there was little or no difference between the exercise which they were required to carry out under section 69(1)(a) and the exercise which they were required to carry out under section 69(4)(a) although the burden was on the Appellant to prove its objection under section 69(1)(a) and the burden was on the Respondent to establish its defence under section 69(4)(a). But I am not satisfied that the outcome would have been the same if the burden of proof had been reversed for the reasons given by the Tribunal in MB Inspection Ltd (above).

Although I did not hear argument on the point and the parties did not address it in their Skeleton Arguments, it seems to me that section 69(4)(a) would be largely redundant if the relevant date for the purposes of section 69(1)(a) is the date of incorporation of the primary Respondent. Moreover, in the absence of any appellate authority, the Tribunal ought (in my respectful judgment) to have followed its own decisions in MB Inspection Ltd and in Zurich. Finally, it is clear that the Tribunal did not consider the application of section 69(1)(a) and section 69(4) separately and Mr Gbla placed much reliance on this point in both his Skeleton Argument and his oral submissions.

With these observations, I turn to the Grounds of Appeal. In paragraph 2 of his Skeleton Argument dated 17 May 2022 Mr Gbla accepted that on 11 November 2019 the Appellant changed its name to "Botanica Agriculture and Extraction Limited" by special resolution and that it purchased the Botanica company logo at the same time. There can be no challenge, therefore, to the Tribunal's reasoning in paragraph 37. It follows that it was for the Appellant to satisfy the Tribunal that it had goodwill in the name “Botanica Limited” either by the date of incorporation or at the date of the application itself (whichever is the correct date).

Mr Gbla's substantive Ground of Appeal was that the Appellant had goodwill in the name “Botanica Limited” before the date of its incorporation. He relied on a number of additional documents which were not before the Tribunal. Moreover, there was no application for permission to adduce these documents as fresh evidence and I am not satisfied that he could not have put them before the Tribunal before the Tribunal's decision in November 2021. But, even if they are admissible in this appeal, I am not satisfied that they would have led the Tribunal to conclude that the Appellant had more than trivial goodwill in the name "Botanica Limited" at the date of the Respondent's incorporation.

Nevertheless, I am not satisfied that the Tribunal would have reached the same conclusion if it had considered whether the Appellant had goodwill in the name "Botanica Limited" as at the date of the application, namely, 29 September 2020 either on the basis of the material which the Appellant put before the Tribunal or upon the basis of the new material upon which Mr Gbla now relies and relied on this appeal.

Mr Gbla also appeals on the basis that he was given misleading advice about the relevance of the Appellant's trademarks by an officer of the Tribunal and he exhibits a detailed email which he sent to the Tribunal on 22 November 2021 immediately after receiving the publication of the Tribunal's decision. He relied on this as evidence that the Tribunal was partial and he relied on a number of other features of the Tribunal's conduct as evidence of bias. For present purposes, the most important objection that he took was that the Respondent failed to provide any of the evidence to support their defence under section 69(4)(a) but the Tribunal went on to decide against the Appellant without any real effort by the Respondent to prove its own case. I have read the passage from the Decision in which that is what the Tribunal appears to have done.

Finally, Mr Gbla seeks permission to rely on a without prejudice letter dated 28 November 2021, which was sent to him by the Respondent after the Decision was published in which it indicated that it was interested in selling the company to the Appellant. Mr Sharma addressed this letter in his oral submissions. He said that given the dispute between the parties he could see nothing wrong in offering to sell Mr Gbla the company as a means of resolving the overall dispute. Mr Gbla relied on this willingness to sell the company as evidence that the Respondent's main purpose in registering the name was to obtain money from the Appellant and not to use it as a legitimate trading name itself and that his application should now be allowed under section 69(5).

For the reasons which I have stated, I am not satisfied that the Tribunal applied the right test under section 69(1)(a) and considered whether the Appellant had goodwill in the name "Botanica Limited" at the date of the application, namely, 29 September 2020 or that they would have reached the same conclusion if they had done so. Moreover, I accept Mr Gbla's submission that there is no suggestion in the Decision that the Respondent adduced any evidence to prove its defence under section 69(4). Both Mr Varaich and Mr Sharma accepted openly and frankly before me that they put in no evidence at all in front of the Tribunal and Mr Varaich gave a number of explanations for his decision to do so.

It seems to me, therefore, that the Tribunal erred as a matter of law in failing to consider the application of both section 69(1) and section 69(4) separately and that this is a reason for allowing the appeal. Moreover, if the Tribunal members had considered each issue separately and had directed themselves that the relevant date under section 69(1)(a) was the date of the application rather than the date of the Respondent’s incorporation, then they might have come to the conclusion that the objection was a valid one. Likewise, if they had addressed section 69(4) separately, they might have rejected the Respondent’s defence on the basis that it had offered no evidence in support of it.

Section 74(4) of the Companies Act 2006 sets out the powers of the court on the hearing of an appeal. The subsection provides as follows:

In my judgment, the appropriate course in the present case is to remit the matter to the Tribunal to decide the Appellant's application again. I have reached this conclusion because I am not satisfied that I can properly decide all of the questions of fact on the hearing of this appeal. I also reach this conclusion with some reluctance because, as Mr Varaich fairly pointed out, the parties have been dealing with this particular issue for almost two years now and the function of the Tribunal is to decide applications of this nature promptly and quickly and with the absence of legal costs and complication. Nevertheless, it seems to me that it is the right course to take in the present case for a number of reasons:

For these reasons, therefore, I allow the appeal and remit the Appellant's application to the Tribunal to be determined again on the basis which I have explained in this judgment. I add one postscript: as I have indicated in the course of this judgment, Mr Varaich and Mr Sharma took significant exception to what were, in my judgment, allegations of fraud made in the application notice and of sharp practice. There is no evidence before me on this appeal that they were guilty of such matters and I make it clear that I have made no decision on those matters. Mr Gbla will have to consider very carefully whether he continues to make those allegations before the Tribunal. But I also note that the Tribunal did not decide those issues either and made no findings of fact in relation to the objections which Mr Gbla made.

Finally, I add that the relief which Mr Gbla sought in his Appellant's notice was not only for an order removing the company's name from the register but also for damages. This is not, of course, something which the Tribunal had power to award and it did not do so. Moreover, on this appeal I have done no more than remit the application to the Tribunal. If Mr Gbla wishes to pursue his application for damages before the Tribunal, he can do so. But, as I have indicated, that is not something that the Tribunal themselves had power to award him. With the direction that I have given in this judgment, the parties will know much more clearly where they stand when they come to make their submissions to the Tribunal and hopefully the issues will be narrowed before them. Indeed, it may be possible that, in the light of this judgment, they may be able to take a view about what the right outcome will be without troubling the Tribunal a second time.