FACTS:
Eugenio del Saz Orozco died on February 7, 1922, leaving a will which he had executed on March 5, 1921. That said will provided that certain properties should be given in life usufruct to his son Jacinto del Saz Orozco y Mortera, with the obligation on his part to preserve said properties in favor of the other heirs who were declared the naked owners thereof. On September 11, 1934, the Benguet Consolidated Mining Company declared and distributed stock dividends out of its surplus profits, the plaintiff receiving his proportionate portion of 11,428 shares. On November 17, 1939, said Mining Company again declared stock dividends out of its surplus profits, of which the plaintiff received 17,142 shares, making a total of 28,570 shares.
ISSUE:
Whether the stock dividend is part of the capital which should be preserved in favor of the owners or an income of fruits of the capital which should be given to and enjoyed by the life usufructuary, the plaintiff herein, as his own exclusive property.
HELD:
The Court ruled based on a previous case decided some time in 1950, where they ruled that:
... A dividend, whether in the form of cash or stock, is income and, consequently, should go to the usufructuary, taking into consideration that a stock dividend as well as a cash dividend can be declared only out of profits of the corporation, for it were declared out of the capital it would be a serious violation of the law.
(in the Matter of the Testate Estate of Emil Maurice Bachrach, October 12, 1950)
With regard to the sum of P3,428.40 which is alleged to have been received by the plaintiff from the Benguet Consolidated Mining Company, as a result of the reduction of its capital in January, 1926, it appears that it has not been proven that the plaintiff has received said sum; on the contrary, it was denied by him as soon as he arrived in the Philippines from Spain. There is no ground, therefore, for ordering the plaintiff to deliver such sum to the defendants.
The Court declares that the stock dividends amounting to 28,570 shares, above mentioned, belongs to the plaintiff-appellant Jacinto del Saz Orozco y Mortera exclusively and in absolute ownership.
Saturday, August 27, 2011
Friday, August 26, 2011
Dominador Dizon vs. Lourdes Suntay (G.R. No. L-30817, September 29, 1972, 47 SCRA 161)
FACTS:
Respondent Lourdes G. Suntay and one Clarita R. Sison entered into a transaction wherein the Suntay’s three-carat diamond ring, valued at P5,500.00, was delivered to Sison for sale on commission. Upon receiving the ring, Sison executed and delivered to the receipt to Suntay. After the lapse of a considerable time without Clarita R. Sison having returned to the ring to her, Suntay made demands on Clarita R. Sison for the return of said jewelry. Clarita R. Sison, however, could not comply with Suntay’s demands because on June 15, 1962, Melia Sison, niece of the husband of Clarita R. Sison, evidently in connivance with the latter, pledged the ring with the petitioner Dominador Dizon's pawnshop for P2,600.00 without Suntay’s knowledge. When Suntay found out that Clarita R. Sison pledged the ring, she filed a case of estafa against the latter with the fiscal's office. Subsequently, Suntay wrote a letter to Dizon on September 22, 1962 asking for the return of her ring which was pledged with the latter’s pawnshop under its Pawnshop Receipt serial B No. 65606, dated June 15, 1962.
Dizon refused to return the ring, so Suntay filed an action for its recovery with the CFI of Manila, which declared that she had the right to its possession. The Court of Appeals likewise affirmed said decision.
ISSUE:
Who has the right title over the subject property?
COURT RULING:
The Supreme Court affirmed the decision of the lower courts. The controlling provision is Article 559 of the Civil Code which provides that “[T]he possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same. If the possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor.” The only exception the law allows is when there is acquisition in good faith of the possessor at a public sale, in which case the owner cannot obtain its return without, reimbursing the price. Hanging on to said exception as his basis, Dizon insisted that the principle of estoppel should apply in this case but the Supreme Court ruled otherwise.
In the present case not only has the ownership and the origin of the jewels misappropriated been unquestionably proven but also that Clarita R. Sison, acting fraudulently and in bad faith, disposed of them and pledged them contrary to agreement with no right of ownership, and to the prejudice of Suntay, who was illegally deprived of said jewels and who, as the owner, has an absolute right to recover the jewels from the possession of whosoever holds them, which in this case is Dizon’s pawnshop. Dizon ought to have been on his guard before accepting the pledge in question, but evidently there was no such precaution availed of and he has no one to blame but himself. While the activity he is engaged in is no doubt legal, it is not to be lost sight of that it thrives on taking advantage of the necessities precisely of that element of our population whose lives are blighted by extreme poverty. From whatever angle the question is viewed then, estoppel certainly cannot be justly invoked.
Respondent Lourdes G. Suntay and one Clarita R. Sison entered into a transaction wherein the Suntay’s three-carat diamond ring, valued at P5,500.00, was delivered to Sison for sale on commission. Upon receiving the ring, Sison executed and delivered to the receipt to Suntay. After the lapse of a considerable time without Clarita R. Sison having returned to the ring to her, Suntay made demands on Clarita R. Sison for the return of said jewelry. Clarita R. Sison, however, could not comply with Suntay’s demands because on June 15, 1962, Melia Sison, niece of the husband of Clarita R. Sison, evidently in connivance with the latter, pledged the ring with the petitioner Dominador Dizon's pawnshop for P2,600.00 without Suntay’s knowledge. When Suntay found out that Clarita R. Sison pledged the ring, she filed a case of estafa against the latter with the fiscal's office. Subsequently, Suntay wrote a letter to Dizon on September 22, 1962 asking for the return of her ring which was pledged with the latter’s pawnshop under its Pawnshop Receipt serial B No. 65606, dated June 15, 1962.
Dizon refused to return the ring, so Suntay filed an action for its recovery with the CFI of Manila, which declared that she had the right to its possession. The Court of Appeals likewise affirmed said decision.
ISSUE:
Who has the right title over the subject property?
COURT RULING:
The Supreme Court affirmed the decision of the lower courts. The controlling provision is Article 559 of the Civil Code which provides that “[T]he possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same. If the possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor.” The only exception the law allows is when there is acquisition in good faith of the possessor at a public sale, in which case the owner cannot obtain its return without, reimbursing the price. Hanging on to said exception as his basis, Dizon insisted that the principle of estoppel should apply in this case but the Supreme Court ruled otherwise.
In the present case not only has the ownership and the origin of the jewels misappropriated been unquestionably proven but also that Clarita R. Sison, acting fraudulently and in bad faith, disposed of them and pledged them contrary to agreement with no right of ownership, and to the prejudice of Suntay, who was illegally deprived of said jewels and who, as the owner, has an absolute right to recover the jewels from the possession of whosoever holds them, which in this case is Dizon’s pawnshop. Dizon ought to have been on his guard before accepting the pledge in question, but evidently there was no such precaution availed of and he has no one to blame but himself. While the activity he is engaged in is no doubt legal, it is not to be lost sight of that it thrives on taking advantage of the necessities precisely of that element of our population whose lives are blighted by extreme poverty. From whatever angle the question is viewed then, estoppel certainly cannot be justly invoked.
Tuesday, August 9, 2011
McDonald's Corporation and McGeorge Food Industries, Inc. vs. L.C. Big Mak Burger, Inc., Francis B. Dy, Edna A. Dy, Rene B. Dy, William B. Dy, Jesus Aycardo, Araceli Aycardo, and Grace Huerto (G.R. No. 143993, August 18, 2004, 480 Phil. 402)
FACTS:
Petitioner, McDonalds Corporation (McDonalds) is a corporation organized under the laws of Delaware, US. It operates, by itself or through its franchisees, a global chain of fast food restaurants. It owns a family of marks including the “Big Mac” mark for its “double decker hamburger sandwich.” McDonalds registered his trademark with the US trademark registry sometime 1979. Based on home registration, McDonalds applied for registration of the same mark in principal registry of the then Philippine Bureau of Patents, Trademark and Technology (PBPTT), now the Intellectual Property Office (IPO). Pending approval of this application, McDonalds introduced its “Big Mac” hamburger sandwiches in the Philippine market in 1981. On 1985, the PBPTT, allowed registration of the “Big Mac” mark in the Philippine registry based on its home registration in the US.
Like its other marks, McDonalds display the Big Mac mark in its item and paraphernalia in its restaurant, and its outdoor and indoor signages. From 1982 to 1990, McDonalds spent millions in advertisement for big mac hamburger sandwich alone.
Petitioner McGeorge Food Industries (Petitioner McGeorge) a domestic corporation, is McDonalds Philippine franchisee.
Respondent, LC Big Mak burger inc. is a domestic corporation which operates fast food outlets and snack vans in metro manila and nearby provinces. Respondents corporation’s menu includes hamburger sandwiches and other food items. Respondent Francis B. Dy, Edna A. Dy, Rene B. Dy, William B. Dy, Jesus Aycardo, Araceli Aycardo, and Grace Huero are the incoporators, stockholders and directors of respondent corporation.
On 1988, respondent corporation applied with the PBPTT for the registration of the Big Mak mark for its hamburger sandwiches. McDonalds opposed respondent corporation’s application on the ground that Big Mak was colorable imitation of its registered Big Mac mark for the same food products. McDonalds also informed respondent Francis Dy, the chairman of the board of directors of the respondent corporation, of its exclusive right to the Big Mac mark and requested him to desist from using the Big Mak mark or any similar mark.
Having received no reply from respondent Dy, petitioners sued respondents in the RTC Makati for trademark infringement and unfair competition. RTC issued a temporary restraining order against respondents enjoinining them from using the Big Mak mark in the operation of their business in the NCR. On 1990, RTC issued a writ of preliminary injunction replacing the TRO.
In their answer, respondents admitted that they have been using the Big Mak burger for their fast food business. Respondents claimed, however, that McDonalds does not have an exclusive right to the Big Mac mark or to any other similar marks. Respondents point out that the Isaiyas group of corporations registered the same mark for hamburger sandwiches with the PBOTT on 1979. One Rodolfo Topacio similarly registered the same mark on 1983, prior to McDonalds registration on 1985. Alternatively, respondents claimed that they are not liable for trademark infringement and unfair competition, as the Big Mak mark they sought to register does not constitute a colorable imitation of the Big Mac mark. Respondents asserted that they did not fraudulently pass off their hamburger sandwiches as those of petitioners Big Mak hamburgers. Respondents sought damages in their counterclaim.
In their reply, petitioners denied respondents claim that McDonalds is not the exclusive owner of the Big Mac mark. Petitioners asserted that while the Isaiyas group and Topacio did register the Big Mac mark ahead of them, the Isaiyas group did so only in the supplemental register of PBPTT and such registration does not provide any protection. McDonalds disclosed that it had acquired Topacio’s rights to his registration in a deed of assignment.
ISSUE:
Did the same acts of defendants in using the name Big Mak as a trademark or trade name in their signages, or in causing the name Big Mak to be printed on the wrappers and containers of their food products also constitute an act of unfair competition under section 29 of the trademark law?
RULING:
Yes. The provision of the law concerning unfair competition is broader and more inclusive than that the law concerning the infringement of trademark, which is more limited range, but within its narrower range recognizes a more exclusive right derived by the adoption and registration of the trademark by the person whose goods or services are first associated therewith. Notwithstanding the distinction between an action for trademark infringement and an action for unfair competition, however, the law extends substantially the same relief to the injured party for both cases.
Any conduct may be said to constitute unfair competition if the effect is to pass off on the public the goods of one man as the goods of another. The choice of Big Mak as trade name by defendant corporation is not merely for sentimental reasons but was clearly made to take advantage of the reputation, popularity and the established goodwill of plaintiff McDonalds. For as stated in Section 29, a person is guilty of unfair competition who in selling his goods shall give them the general appearance, of goods of another manufacturer or dealer, either as goods themselves or in the wrapping of the packages in which they are contained, or the devices or words thereon, or in any other feature of their appearance, which would likely influence purchasers to believe that the goods offered are those of a manufacturer or dealer other than the actual manufacturer or dealer. Thus, plaintiffs have established their valid cause of action against the defendants for trademark infringement and unfair competition and for damages.
Digest by: Don D. Ballesteros
Editing by: JMaminta
Petitioner, McDonalds Corporation (McDonalds) is a corporation organized under the laws of Delaware, US. It operates, by itself or through its franchisees, a global chain of fast food restaurants. It owns a family of marks including the “Big Mac” mark for its “double decker hamburger sandwich.” McDonalds registered his trademark with the US trademark registry sometime 1979. Based on home registration, McDonalds applied for registration of the same mark in principal registry of the then Philippine Bureau of Patents, Trademark and Technology (PBPTT), now the Intellectual Property Office (IPO). Pending approval of this application, McDonalds introduced its “Big Mac” hamburger sandwiches in the Philippine market in 1981. On 1985, the PBPTT, allowed registration of the “Big Mac” mark in the Philippine registry based on its home registration in the US.
Like its other marks, McDonalds display the Big Mac mark in its item and paraphernalia in its restaurant, and its outdoor and indoor signages. From 1982 to 1990, McDonalds spent millions in advertisement for big mac hamburger sandwich alone.
Petitioner McGeorge Food Industries (Petitioner McGeorge) a domestic corporation, is McDonalds Philippine franchisee.
Respondent, LC Big Mak burger inc. is a domestic corporation which operates fast food outlets and snack vans in metro manila and nearby provinces. Respondents corporation’s menu includes hamburger sandwiches and other food items. Respondent Francis B. Dy, Edna A. Dy, Rene B. Dy, William B. Dy, Jesus Aycardo, Araceli Aycardo, and Grace Huero are the incoporators, stockholders and directors of respondent corporation.
On 1988, respondent corporation applied with the PBPTT for the registration of the Big Mak mark for its hamburger sandwiches. McDonalds opposed respondent corporation’s application on the ground that Big Mak was colorable imitation of its registered Big Mac mark for the same food products. McDonalds also informed respondent Francis Dy, the chairman of the board of directors of the respondent corporation, of its exclusive right to the Big Mac mark and requested him to desist from using the Big Mak mark or any similar mark.
Having received no reply from respondent Dy, petitioners sued respondents in the RTC Makati for trademark infringement and unfair competition. RTC issued a temporary restraining order against respondents enjoinining them from using the Big Mak mark in the operation of their business in the NCR. On 1990, RTC issued a writ of preliminary injunction replacing the TRO.
In their answer, respondents admitted that they have been using the Big Mak burger for their fast food business. Respondents claimed, however, that McDonalds does not have an exclusive right to the Big Mac mark or to any other similar marks. Respondents point out that the Isaiyas group of corporations registered the same mark for hamburger sandwiches with the PBOTT on 1979. One Rodolfo Topacio similarly registered the same mark on 1983, prior to McDonalds registration on 1985. Alternatively, respondents claimed that they are not liable for trademark infringement and unfair competition, as the Big Mak mark they sought to register does not constitute a colorable imitation of the Big Mac mark. Respondents asserted that they did not fraudulently pass off their hamburger sandwiches as those of petitioners Big Mak hamburgers. Respondents sought damages in their counterclaim.
In their reply, petitioners denied respondents claim that McDonalds is not the exclusive owner of the Big Mac mark. Petitioners asserted that while the Isaiyas group and Topacio did register the Big Mac mark ahead of them, the Isaiyas group did so only in the supplemental register of PBPTT and such registration does not provide any protection. McDonalds disclosed that it had acquired Topacio’s rights to his registration in a deed of assignment.
ISSUE:
Did the same acts of defendants in using the name Big Mak as a trademark or trade name in their signages, or in causing the name Big Mak to be printed on the wrappers and containers of their food products also constitute an act of unfair competition under section 29 of the trademark law?
RULING:
Yes. The provision of the law concerning unfair competition is broader and more inclusive than that the law concerning the infringement of trademark, which is more limited range, but within its narrower range recognizes a more exclusive right derived by the adoption and registration of the trademark by the person whose goods or services are first associated therewith. Notwithstanding the distinction between an action for trademark infringement and an action for unfair competition, however, the law extends substantially the same relief to the injured party for both cases.
Any conduct may be said to constitute unfair competition if the effect is to pass off on the public the goods of one man as the goods of another. The choice of Big Mak as trade name by defendant corporation is not merely for sentimental reasons but was clearly made to take advantage of the reputation, popularity and the established goodwill of plaintiff McDonalds. For as stated in Section 29, a person is guilty of unfair competition who in selling his goods shall give them the general appearance, of goods of another manufacturer or dealer, either as goods themselves or in the wrapping of the packages in which they are contained, or the devices or words thereon, or in any other feature of their appearance, which would likely influence purchasers to believe that the goods offered are those of a manufacturer or dealer other than the actual manufacturer or dealer. Thus, plaintiffs have established their valid cause of action against the defendants for trademark infringement and unfair competition and for damages.
Digest by: Don D. Ballesteros
Editing by: JMaminta
Thursday, August 4, 2011
Elidad C. Kho vs. Court of Appeals, Summerville General Merchandising Company and Ang Tiam Chay (G.R. No. 115758, March 19, 2002, 379 SCRA 410)
FACTS:
Petitioner‘s allegations are that they are doing business under the name and style of KEC Cosmetics Laboratory, registered owner of Chin Chun Su and oval facial cream container/case, and alleges that she also has patent rights on Chin Chun Su and Device and Chin Chun Su Medicated Cream after purchasing the same from Quintin Cheng, the registered owner thereof in the supplemental register of the Philippine Patent Office and that Summerville advertised and sold petitioner’s cream products under the brand name Chin Chun Su, in similar containers that petitioner uses, thereby misleading the public, and resulting in the decline in the petitioner’s business sales and income; and, that the respondents should be enjoined from allegedly infringing on the copyrights and patents of the petitioner.
The respondents, on the other hand, alleged as their defense that (1) Summerville is the exclusive and authorized importer, re-packer and distributor of Chin Chun Su products manufactured by Shun Yi factory of Taiwan, (2) that the said Taiwanese manufacturing company authorized Summerville to register its trade name Chin Chun Cu Medicated Cream with the Philippine Patent office and Other appropriate governmental agencies; (3) that KEC Cosmetics Laboratory of the petitioner obtained the copyrights through misrepresentation and falsification; and, (4) that the authority of Quintin Cheng, assignee of the patent registration certificate, to distribute and market Chin Chun Su products in the Philippines had already terminated by the said Taiwanese manufacturing company.
ISSUE:
Whether or not Kho has the sole right using the package of Chin Chun Su products
RULING:
Petitioner has no right to support her claim for the exclusive use of the subject trade name and its container. The name and container of a beauty cream product are proper subjects of a trademark in as much as the same falls squarely within its definition. In order to be entitled to exclusively use the same in the sale of the beauty cream product, the user must sufficiently prove that she registered or used it before anybody else did. The petitioner’s copyright and patent registration of the name and container would not guarantee her the right to exclusive use of the same for the reason that they are not appropriate subjects of the said intellectual rights. Consequently, a preliminary injunction order cannot be issued for the reason that the petitioner has not proven that she has a clear right over the said name and container to the exclusion of others, not having proven that she has registered a trademark thereto or used the same before anyone did.
NOTE:
Trademark, copyright, and patents are different intellectual property rights that cannot be interchanged with one another. A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an enterprise and shall include a stamped or marked container goods. In relation thereto, a trade name means the name or designation identifying or distinguishing an enterprise. Meanwhile, the scope of copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of their creation. Patentable inventions, on the other hand, refer to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrial applicable.
Digest by: Don D. Ballesteros
Editing by: JMaminta
Petitioner‘s allegations are that they are doing business under the name and style of KEC Cosmetics Laboratory, registered owner of Chin Chun Su and oval facial cream container/case, and alleges that she also has patent rights on Chin Chun Su and Device and Chin Chun Su Medicated Cream after purchasing the same from Quintin Cheng, the registered owner thereof in the supplemental register of the Philippine Patent Office and that Summerville advertised and sold petitioner’s cream products under the brand name Chin Chun Su, in similar containers that petitioner uses, thereby misleading the public, and resulting in the decline in the petitioner’s business sales and income; and, that the respondents should be enjoined from allegedly infringing on the copyrights and patents of the petitioner.
The respondents, on the other hand, alleged as their defense that (1) Summerville is the exclusive and authorized importer, re-packer and distributor of Chin Chun Su products manufactured by Shun Yi factory of Taiwan, (2) that the said Taiwanese manufacturing company authorized Summerville to register its trade name Chin Chun Cu Medicated Cream with the Philippine Patent office and Other appropriate governmental agencies; (3) that KEC Cosmetics Laboratory of the petitioner obtained the copyrights through misrepresentation and falsification; and, (4) that the authority of Quintin Cheng, assignee of the patent registration certificate, to distribute and market Chin Chun Su products in the Philippines had already terminated by the said Taiwanese manufacturing company.
ISSUE:
Whether or not Kho has the sole right using the package of Chin Chun Su products
RULING:
Petitioner has no right to support her claim for the exclusive use of the subject trade name and its container. The name and container of a beauty cream product are proper subjects of a trademark in as much as the same falls squarely within its definition. In order to be entitled to exclusively use the same in the sale of the beauty cream product, the user must sufficiently prove that she registered or used it before anybody else did. The petitioner’s copyright and patent registration of the name and container would not guarantee her the right to exclusive use of the same for the reason that they are not appropriate subjects of the said intellectual rights. Consequently, a preliminary injunction order cannot be issued for the reason that the petitioner has not proven that she has a clear right over the said name and container to the exclusion of others, not having proven that she has registered a trademark thereto or used the same before anyone did.
NOTE:
Trademark, copyright, and patents are different intellectual property rights that cannot be interchanged with one another. A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an enterprise and shall include a stamped or marked container goods. In relation thereto, a trade name means the name or designation identifying or distinguishing an enterprise. Meanwhile, the scope of copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of their creation. Patentable inventions, on the other hand, refer to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrial applicable.
Digest by: Don D. Ballesteros
Editing by: JMaminta
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