Decision

Decision on AXA Wholesale Trading Ltd

Published 26 October 2022

Companies Act 2006

In the matter of application No. 3321 by AXA for a change to the company name of AXA WHOLESALE TRADING LTD, company registration no. 12935712.

Background and pleadings

1. Company no. 12935712 (“the primary respondent”) was incorporated on 7 October 2020 with the name “AXA WHOLESALE TRADING LTD”. The Companies House website describes the primary respondent’s “Nature of business (SIC)” as “46900 - non-specialised wholesale trade”.

2. On 3 November 2020, AXA (“the applicant”) applied under Section 69(1) of the Companies Act 2006 (“the Act”) for the primary respondent’s name to be changed.

3. Section 69 of the Act states:

“(1) A person (“the applicant”) may object to a company’s registered name on the ground-

(a) that it is the same as a name associated with the applicant in which he has goodwill, or

(b) that it is sufficiently similar to such a name that its use in the United Kingdom would be likely to mislead by suggesting a connection between the company and the applicant

(2) The objection must be made by application to a company names adjudicator (see section 70)

(3) The company concerned shall be the primary respondent to the application. Any of its members or directors may be joined as respondents

(4) If the ground specified in subsection (1)(a) or (b) is established, it is for the respondents to show-

(a) that the name was registered before the commencement of the activities on which the applicant relies to show goodwill; or

(b) that the company-

(i) is operating under the name, or
(ii) is proposing to do so and has incurred substantial start-up costs in preparation, or
(iii) was formerly operating under the name and is now dormant; or

(c) that the name was registered in the ordinary course of a company formation business and the company is available for sale to the applicant on the standard terms of that business; or

(d) that the name was adopted in good faith; or

(e) that the interests of the applicant are not adversely affected to any significant extent.

If none of these is shown, the objection shall be upheld

(5) If the facts mentioned in subsection 4(a), (b) or (c) are established, the objection shall nevertheless be upheld if the applicant shows that the main purpose of the respondents (or any of them) in registering the name was to obtain money (or other consideration) from the applicant or prevent him from registering the name

(6) If the objection is not upheld under subsection (4) or (5), it shall be dismissed

(7) In this section “goodwill” includes reputation of any description.”

4. The name associated with the applicant which caused it to make its application is “AXA”. The applicant states:

AXA is a French company and one of the world’s largest and most renowned insurance, life insurance, investment, financial and asset management companies with operations in 57 countries, including the UK, with over 160,000 employees and 108 million customers. AXA has been trading continuously under the AXA trade mark in the UK since 1985 investing significantly in the promotion of its services under the AXA mark through advertising and PR campaigns over the decades including prime television advertising. The AXA trade mark has acquired a substantial reputation and goodwill in the UK for inter alia investment, insurance, life insurance, financial and asset management services. Such is the reputation of AXA in the UK that the name and trade mark AXA has become synonymous with AXA’s business by the UK public.

5. The applicant states that the field of business in which the name upon which it relies has goodwill/reputation is:

Insurance, life insurance, investment, financial services, wealth and asset management.

6. The applicant explains that it objects to the company name because its reputation in the ‘AXA’ name in relation to insurance, life insurance, investment, financial services, wealth and asset management is such that it is inevitable that the registration of a name which contains the word ‘AXA’ was made to take advantage of the said reputation. Further, the applicant states that the words ‘WHOLESALE TRADING’ form a financial term and so merely emphasise the association with the applicant and that the name as a whole will inevitably lead to confusion because consumers will assume that the company is one of the companies within the ‘AXA’ group, e.g. one that deals with the wholesale trading.

7. The applicant indicates that it is claiming its costs and that it wrote to the primary respondent on 15 October 2020 asking it to change its name to one that does not contain the word ‘AXA’.

8. The primary respondent filed a notice of defence (Form CNA2) dated 2 January 2021 signed by his representative, Mr Okey Ngwuocha. It states that the primary respondent accepts that the applicant has acquired “a massive goodwill and reputation” in the name and trade mark ‘AXA’ in relation to insurance, life insurance, investment, financial services, wealth and asset management. However, it denies the following:

1. The fact that the applicant’s massive reputation in their specific field of business makes it inevitable that the respondent is seeking to take advantage of the applicant’s reputation;
   
2. That the words ‘WHOLESALE TRADING’ form a financial term and emphasise an association with the applicant;
   
3. That the use of the name ‘AXA WHOLESALE TRADING LIMITED’ will lead to confusion as consumers will assume that the respondent is one of the companies within the ‘AXA’ group;
   
4. That the interests of the applicant will be adversely impacted by the registration of the respondent.

9. In its notice of defence, the primary respondent indicates that it is relying upon the defences based upon Sections 69(4)(d) and (e) of the Act, namely (1) good faith and (2) the interests of the applicant are not adversely affected, respectively. It further indicates that it is claiming its costs. It also provides the following information to support its defence:

i. That the respondent’s name ‘AXA’ was originally formed from the first letter of the names of the owners: Ali Hashem and Alaa Awad who are a married couple;

ii. That the above innocent adoption of ‘AXA’ in the name of their company ‘AXA ENGINEERING LIMITED’ was accepted by the Tribunal in previous proceedings;

iii. That all of the above facts regarding the respondent’s adoption of ‘AXA’ were known to the applicant and their legal advisers;

iv. That the respondent’s founder Ali Hashem had duly conducted a company name availability check at Companies House before applying for its registration as a company.

10. Only the applicant filed evidence.

11. In these proceedings, the applicant is represented by Keltie LLP; the primary respondent is represented by Carl Martin Solicitors.

12. A hearing took place before me on 24 August 2022 via video link, at which the applicant was represented by Miss Denise McFarland of Counsel instructed by Keltie LLP and the primary respondent was represented by Okey Ngwuocha (Solicitor) of the firm of Carl Martin Solicitors.

The applicant’s evidence

13. The applicant’s evidence consists of two witness statements (both dated 20 April 2021), by Rosemary Cardas, who is a trade mark attorney at Keltie LLP, the firm representing the applicant’s in these proceedings. Ms Cardas’ first witness statement is simply a vehicle for introducing Exhibit RC1, which shows that the names ‘A&A WHOLESALE TRADING LTD’ and ‘AA WHOLESALE TRADING LTD’ were available for registration in October 2020.

14. Ms Cardas’ second witness statement introduces only one exhibit, RC2, which contains a witness statement from Amber Wilkinson, the Strategy, Brand and Communication Director of AXA UK PLC (also dated 20 April 2021). Ms Wilkinson’s statement is accompanied by 13 exhibits (AW1-AW13) and introduces, amongst other exhibits, a witness statement from Darrell Sansom (dated 20 July 2017) who is the Chief Marketing Officer for AXA UK and Ireland. The reason why the applicant’s evidence is set out in this way is that it recycles old evidence used in other proceedings.

Decision

15. If the primary respondent defends the application, as here, the applicant must establish that it has goodwill or reputation in relation to a name that is the same, or sufficiently similar, to that of the company name suggesting a connection between the company and the applicant. If this burden is fulfilled, it is then necessary to consider if the primary respondent can rely upon the defences under Section 69(4) of the Act.

The applicant’s goodwill/reputation

16. Section 69(7) of the Act defines goodwill as a “reputation of any description”. Consequently, in the terms of the Act it is not limited to Lord Macnaghten’s classic definition in IRC v Muller & Co’s Margerine Ltd [1901] AC 217:

What is goodwill? It is a thing very easy to describe, very difficult to define. It is the benefit and advantage of the good name, reputation, and connection of a business. It is the attractive force which brings in custom. It is the one thing which distinguishes an old-established business from a new business at its first start.

17. The relevant date is the date of incorporation of the primary respondent which, in this case, is 7 October 2020. The applicant must show that it had a goodwill or reputation at this date associated with the name ‘AXA’.

18. In relation to establishing a goodwill/reputation, this Tribunal routinely looks for guidance to case law developed in trade mark proceedings. In such proceedings, it is well-established that goodwill of more than a trivial nature, even if it is small, is capable of protection (Stacey v 2020 Communications [1991] FSR 49 refers).

19. In its Form CNA2, the primary respondent has expressly admitted the applicant’s claim that it has acquired “a massive goodwill and reputation” in the name and trade mark ‘AXA’ in relation to insurance, life insurance, investment, financial services, wealth and asset management. The same fact was also admitted by Mr Ngwuocha on the primary respondent’s behalf during the hearing. I therefore proceed on the basis that, by the relevant date in these proceedings, the applicant had acquired a protectable goodwill in relation to the activities relied upon.

Similarity of names

20. The other initial burden facing the applicant is that the primary respondent’s name is sufficiently similar to ‘AXA’ to suggest a connection between the primary respondent and the applicant.

21. The primary respondent’s name is ‘AXA WHOLESALE TRADING LTD’. In addition to the word ‘AXA’ the primary respondent’s name includes the words ‘WHOLESALE’, ‘TRADING’ and ‘LTD’.

22. The primary respondent’s “nature of business” as disclosed on the Companies House website is “non-specialised wholesale trade”. Consequently, the word ‘WHOLESALE’ and ‘TRADING’ self-evidently indicate the nature of the primary respondent’s business, i.e. non-specialised wholesale trade, whilst the word ‘LTD’ indicates its legal status; these words are non-distinctive.

23. In his skeleton argument, Mr Ngwuocha referred to the company’s website – that he said is www.axa.trading.com – and reproduced the extract shown below:

No food service is complete without a significant supply of plastic cups at hand. These disposable cups are a necessary requirement for all catering services as well as restaurants for the purpose of serving cold drinks both inside the restaurant and for takeaway small smoothies and slushies.

This disposable plastic cup with its fitting lid is our most popular selection for serving cold drinks and beverages.

24. If the primary respondent wished to rely on evidence from its website, it should have presented such information in a proper evidential format, which has not been done. In any event, the extract only provides some information about use of plastic cups and disposal cups in the catering sector, but it is not clear that the primary respondent is operating in that area of business or, indeed, that is operating at all.

25. I pause here to say that in his oral submissions, Mr Ngwuocha argued that the primary respondent is operating and is “actively involved in trading in its own area of activity”. I was surprised to see a point of such importance to be raised at the hearing without having been pleaded in the Form CNA2 (and without evidence having been filed), however, after some discussion, Mr Ngwuocha confirmed that he did not intend to plead the defence introduced by Section 69(4)(b)(i) – that the company is operating under the name.

26. Another point made by Mr Ngwuocha relates to the submission that the term “WHOLESALE TRADING” does not form a financial term and it is not something which would either be confused with or allude to the scope of the business in respect of which the applicant has reputation and/or that it is not a financial term that is used within the scope of applicant’s business.

27. In response to this point, Ms McFarland referred to the following passages from her skeleton argument:

29.3 We particularly refer the Tribunal to the very clear evidence of Ms. Wilkinson at paragraphs [19] to [24] of her w/s this demonstrates very clearly the basis of the actual and potential for significant adverse impact and effect. Not least we note the advert for “Axa London Wholesale” on the same page as the article at Exhibit AW12;

29.4 Moreover, we also pray in aid the sound and correct reasoning adopted by and findings made by the Tribunal in their Earlier Decision (see para [ 40] of the Decision in this regard). Exactly the same reasoning applies in the present case.

29.5 We also pray in aid the fact that the choice of the words WHOLESALE TRADING adopted in the Resp name are descriptive of financial WHOLESALE TRADING and therefore deliberately move the impression created by the company name as a whole into the trading area of the App. Thus making damage risk and material adverse impact all the more likely, in particular we note that “Wholesale Trade” is defined in https://financial-dictionary.thefreedictionary.com/wholesale+trade as ‘the sale of securities among broker-dealers and to large institutional investors’. The App itself uses this term “Wholesale” in connection with funds and examples of the former funds of the App include the following names: AXA Wholesale Australian Equity – Growth Fund, AXA Wholesale Global Fixed Income – Managed Fund and AXA Wholesale Global Property Securities Unhedged – Managed Fund.

28. Ms Wilkinson’s evidence includes the following:

• according to the records to which Ms Wilkinson has access, “the Gross Wholesale Premium (GWP) for insurance provided under the AXA name to the wholesale industry for the category of insurance provided under the Transport/Warehouse/Wholesale (& sub-divisions) is 12.08% of AXA’s UK book. This amounts to £145 million annually in the UK”. Exhibited at AW10 are copies of pages (undated) from axaconnect.co.uk which list ‘wholesale and retail’ as one of the trade groups covered by the applicant’s commercial lines;
  
• according to Ms Wilkinson, AXA’s insurance products may be sold through Wholesale Insurance Brokers and the GWP placed with AXA via Wholesale Insurance Brokers for schemes which have wholesale brokers is approximately £126 million annually in the UK. Exhibited at AW11 is copy of a market study conducted by AXA in February 2019 in relation to the Wholesale Insurance Broker Market. Further, AW12 shows an online article from www.insurancebusinessmag.com explaining the meaning of “wholesale insurance broker”. It explains that “a wholesale insurance broker acts as an intermediary between a retail broker and an insurance carrier” and that “wholesale insurance brokers rarely have direct contact with the insured; rather the retail broker will manage that relationship and will sell the insurance to the client”. AW13 is copy of an article dated 24 July 2019 headed “AXA XL bolsters London market wholesale business”

29. Whilst the word ‘wholesale’ is ordinarily used to refer to wholesale suppliers and is defined as “the activity of buying and selling goods in large quantities and therefore at cheaper prices, usually to shopkeepers who then sell them to the public”, the above evidence shows that the term ‘wholesale’ is also used in insurance to designate both the sector in relation to which insurance products are offered and a type of insurance broker. Further, even if I were to accept that the SIC code selected by the primary respondent, namely “46900 - non-specialised wholesale trade”, relates to ordinary wholesale activities which have no connection with insurance services – rather than to the term wholesale as it is understood in the insurance market – that would be irrelevant. This is because, as it was stated in a previous decision between the same parties to which I refer below:

The nature of the respondent’s business is not usually an important factor in the assessment of whether use of the respondent’s name is likely to mislead. This is because although a company’s main business activities are recorded in the Register of Companies, this does not prevent companies from conducting other activities. ^{[footnote 1]}

30. In this case the company name ‘AXA WHOLESALE TRADING LTD’ lends itself to use in relation to an insurance business providing, for example, insurance cover to wholesale traders or insurance products sold through Wholesale Insurance Brokers.

31. Consequently, having regard to the applicant’s reputation for insurance and financial services, and to the evidence establishing use of the term ‘WHOLESALE’ in the context of insurance services, my conclusion is that the words ‘WHOLESALE TRADING LTD’ are insufficient to neutralise the effect of the use of ‘AXA’ as the first word in the primary respondent’s name, and that use of the primary respondent’s name would be likely to mislead people by suggesting a connection between the primary respondent and the applicant.

32. As the ground specified in subsection 69(1)(b) is established, the onus switches to the primary respondent to establish whether it can rely on any of the defences pleaded in the notice of defence.

Defences

33. The statutory defences under Section 69(4) are set out at the beginning of this decision. The primary respondent relies upon the defences identified at Sections 69(4) (d) and (e) of the Act, namely:

• that the company name was adopted in good faith (section 69(4)(d)); and,

• that the interests of the applicant are not adversely affected to any significant extent (section 69(4)(e))

34. It is for the primary respondent to make good its defences through filing evidence. Despite being invited by the Tribunal to file evidence after the applicant filed its evidence, there was no response from the primary respondent. The only documentation which the primary respondent has filed in these proceedings is the Form CNA2.

Section 69(4)(d) - that the name was adopted in good faith.

35. The first defence being relied upon is that “that the name was adopted in good faith.”

36. The following principles in relation to good faith can be extracted from the judgments of the Privy Council in Barlow Clowes v Eurotrust International Ltd [2005] UKPC 37 and the Court of Appeal in England and Wales in Niru Battery Manufacturing v Milestone Trading Ltd [2003] EWCA Civ 1446:

(i) good faith is a broad concept which includes a failure to act in a commercially acceptable way. It includes sharp practice which falls short of outright dishonesty, and also dishonesty itself - see Niru Battery at paragraph 164

(ii) there is a combined subjective/objective approach to the honesty of a party’s behaviour. This involves (i) a consideration of what the party knew at the time of a transaction and (ii) how that party’s action would be viewed by applying normally acceptable standards of commercial behaviour - see Barlow Clowes paras 15–18, 28–32

37. The relevant date for this defence is the date on which the company name was adopted, namely 7 October 2020.

38. It is evident from the wording of Section 69(4) of the Act that the onus is on the primary respondent to show that the contested name was adopted in good faith. The Act makes it clear that if the provisions of Section 69(1) are satisfied, as they are in this case, that it is for the primary respondent to support any defences relied upon. It is not for the applicant to prove that the name was adopted in bad faith: the onus is on the primary respondent to prove that the contested company name was adopted in good faith. The primary respondent is the party which bears the burden of evidential proof, not the applicant.

39. The primary respondent’s defence appears to be based upon the fact that in an earlier decision between the parties concerning a different company (decision O-208-18 dated 29 March 2018) the Tribunal found in favour of the respondent’s founder, Mr Ali Hashem, and accepted that the name ‘AXA ENGINEERING LIMITED’ was adopted in good faith. The argument, as I understand it, is that that finding should be binding on me in respect of the new company ‘AXA WHOLESALE TRADING LIMITED’, which was set up by Mr Hashem more than two years after the earlier decision was issued.

40. The submissions of Mr Ngwuocha were based on the following passages from the earlier decision:

“49. We accept that using a letter X as a proxy for the ‘&’ symbol is not an obvious choice. However, we do not regard this explanation as contradicting the later claim that the letter ‘X’ was also meant as a sign of the affection between Mr Hashem and his partner. This is consistent with Mr Hashem’s evidence that shortly before the respondent’s name was adopted, he purchased vehicle number plates for himself and his partner including the letters AXA.

50. In different circumstances we may have had more trouble in accepting Mr Hashem’s explanation for choosing a company name including AXA. However, his evidence is further supported, in our view, by the fact that the full name he chose was AXA ENGINEERING. Although, we have found that ‘Engineering’ could be used to describe a category of insurance cover, this is unlikely to be evident to the general public. It also seems unlikely that Mr Hashem would have had this in mind. Although he is a graduate engineer, at the time he adopted the respondent’s name he did not have an engineering business to insure. We therefore accept the respondent’s evidence that the name was adopted in good faith for the reasons given by Mr Hashem. Consequently, the defence in s.69(4)(d) of the Act applies.”

41. Miss McFarland criticised the primary respondent’s reliance on the earlier decision for the following reasons:

• the Company Name was different, and the date of adoption and registration was at an earlier time;

• evidence in support of the claim of good faith had been served in the earlier application and was accepted by the Tribunal (no such evidence having been produced at all in the current proceedings).

• in particular at para 7 of the earlier decision the Tribunal recorded that Mr Hashem “says that he did not know of the applicant prior to the incorporation of the respondent [Engineering] company”. Even if Mr Hashem had provided evidence in the current proceedings (which he has not) crucially it would not be possible for him to plead/ assert ignorance or lack of knowledge of AXA this time around. Clearly, during the earlier proceedings he, his wife and their representatives, notably the same solicitors appear in the current proceedings, were all put on clear and unequivocal notice of AXA’s claims, massive repute, goodwill and trade mark portfolio;

• at para 25 of the earlier decision, the Tribunal found that AXA had a substantial goodwill and reputation in the UK that extended beyond insurance business to other financial services;

• for the above reasons, it would have been impossible, as at October 2020, for Mr Hashem (or his wife or his legal representative) to have been unaware of ‘AXA’ and their intellectual property rights

42. I agree with Ms McFarland that the primary respondent cannot rely on the previous decision O/208/18 to continue to act with impunity and populate the company names register with new companies using the applicant’s name AXA.

43. Quite properly the adjudicators in the previous decision had specifically noted that “in different circumstances [they] may have had more trouble in accepting Mr Hashem’s explanation for choosing a company name including AXA”.

44. As far as the previous decision relating to the adoption of the company name AXA ENGINEERING is concerned, that was on an entirely different basis that the primary respondent’s claim of good faith was accepted, on account of the evidence filed and the defence pleaded at that time, which included the claim that the primary respondent was not aware of the applicant when the offending company name was incorporated. Not surprisingly, the fact that the primary respondent was not aware of the applicant was not pleaded in this case, as the primary respondent could not have been unaware given that the company objected in these proceedings was incorporated after the previous decision was issued.

45. The matters upon which the primary respondent relies, namely that this Tribunal found in his favour in a previous decision, is not, in itself sufficient to demonstrate that it acted in good faith in this case. There is nothing to support the primary respondent’s defence that the name was adopted in good faith, and I find the fact that the primary respondent was aware of the applicant (as expressly accepted by the primary respondent itself on the Form CNA2) an indication to the contrary.

46. Adopting a company name which contained as its only distinctive component a word which was identical to that used by a long-established and highly successful financial and insurance business in the UK would, in my view, be regarded by a reasonable person in the field as falling below commercially acceptable standards. As a consequence, the defence based upon Section 69(4)(d) of the Act fails accordingly.

Section 69(4)(e) - that the interests of the applicant are not adversely affected to any significant extent.

47. To rely on a ‘no adverse effect’ defence it is for the respondent to show, in evidence, what it has done or intends to do. The onus is therefore on the primary respondent to show why its company name does not adversely affect the applicant’s interests to any significant extent. The onus is not on the applicant.

48. The primary respondent has not filed any evidence about its current activities or intentions as regards the objected company. However, the actual or potential field of activity is not strictly pertinent because the Act refers to the connection under Section 69(1)(b) being made upon the basis of the names themselves. Consequently, the fact that the primary respondent may not be trading is not relevant as the primary respondent’s intentions may change over time. This may include expanding the primary respondent’s business in future or selling the company to someone who may trade in the same field in which the applicant operates and has goodwill. As this will, in my view, affect the applicant’s interests to a significant extent, the defence based upon Section 69(4)(e) also fails.

49. The ‘no adverse effect’ defence is also rejected.

Conclusion

50. The primary respondent has failed to make out a defence that its incorporation was made in good faith or that the applicant’s interests are not adversely affected. Consequently, the application for a change of the primary respondent’s name to a non-offending name is successful.

51. In accordance with Section 73(1) of the Act, the following order is made:

(a) AXA WHOLESALE TRADING LTD shall change its name within one month of the date of this order to one that is not an offending name;

(b) AXA WHOLESALE TRADING LTD shall:

(i) take such steps as are within its power to make, or facilitate the making, of that change;

(ii) not cause or permit any steps to be taken calculated to result in another company being registered with a name that is an offending name.

52. In accordance with Section73(3) of the Act, this order may be enforced in the same way as an order of the High Court or, in Scotland, the Court of Session.

53. In any event, if no such change is made within one month of the date of this order, a new company name will be determined as per Section 73(4) of the Act and notice will be given of that change under Section 73(5) of the Act.

54. All respondents, including individual co-respondents, have a legal duty under Section 73(1)(b)(ii) of the Companies Act 2006 not to cause or permit any steps to be taken calculated to result in another company being registered with an offending name; this includes the current company. Non-compliance may result in an action being brought for contempt of court and may result in a custodial sentence.

Costs

55. The Tribunal awards costs from the published scale at paragraph 10 of the Tribunal’s Practice Direction. This is intended to provide a contribution to costs, but not to recompense the successful party. It is the applicant who has been successful in these proceedings and which is entitled to a contribution towards its costs. The award breakdown is as follows:

Filing the Form CNA1 and considering the Form CNA2: £400
Preparing and filing evidence: £500
Preparing for and attending a hearing: £1000
Fee for filing the Form CNA1: £400
Official fees for filing evidence: £150
Official fee for requesting a hearing £100


Total: £2,550

56. AXA WHOLESALE TRADING LTD is ordered to pay AXA the sum of £2,550 within fourteen days of the expiry of the appeal period, or within fourteen days of the final determination of this case if any appeal against this decision is unsuccessful. Under Section 74(1) of the Act, an appeal can only be made in relation to the decision to uphold the application; there is no right of appeal in relation to costs.

57. Any notice of appeal must be given within one month of the date of this decision. Appeal is to the High Court in England, Wales and Northern Ireland and to the Court of Session in Scotland. The Tribunal must be advised if an appeal is lodged.

Dated 20 October 2022

Teresa Perks
Company Names Adjudicator

1. Ms McFarland also referred in her skeleton argument to the decision in Cavern Records Limited Published on 18 May 2020 - in The Matter of Application Number 1912 by Cavern City Tours Limited, paragraph 32-33 which states that “the nature of the primary respondent’s business is not usually an important factor in the assessment of whether [or not] use of the contested name is liable to mislead” ↩