A registered trademark owner does not abandon rights unless clear evidence of intent to relinquish such rights is established.

[1] The plaintiff, (hereinafter referred to as the appellant), filed a claim at the High Court at Alor Setar against the defendants (hereinafter referred to as the respondents) for infringement of his "Reynox" registered trade mark (the trade mark) and for passing off. Reynox was the trade mark name for liquid fertilizer.

[2] The 1st respondent is the brother of the appellant.

[3] In their defence, the respondents alleged that the registration of the trade mark for liquid fertilizer had been obtained by the appellant by fraud committed on the 1st respondent. The respondents alleged that the trade mark was to be registered in the name of the appellant and the 1st respondent initially, and thereafter to be transferred to the 2nd respondent.

[4] The 2nd respondent was formed to take over the production, business, sale and distribution of the above-mentioned Reynox liquid fertilizer, with the appellant and the 1st respondent each owning equal share in the 2nd respondent. The appellant was also a director in the 2nd respondent.

[5] In short, it was a family business, to trade in the Reynox liquid fertilizer business acquired from RH One Marketing earlier by the appellant and the 1st respondent.

[6] A partnership (partnership firm) was also formed by the appellant and the 1st respondent, which also used the trade mark. Since the question before us relates to the 2nd respondent only, the answer to the leave question will only be confined to the 2nd respondent (see para 13).

[7] By way of a counterclaim, the respondents alleged that the action by the appellant in registering the Reynox trade mark in his sole name had been done mala fide and by deception, and as such the appellant's right to register the said trade mark was disputed. The 1st respondent's counterclaim against the appellant was for a declaration that the appellant was not entitled to the trade mark in his own name.

[8] After a full trial, the High Court allowed the appellant's claim and dismissed the respondents' counterclaim, with costs of RM20,000.00. In gist, the High Court held that the trade mark "Reynox" had been registered in the name of the appellant and was the registered owner of the trade mark. He thus had the exclusive right pursuant to s 35(1) of the Trade Marks Act 1976 (the TMA 1976) to use the trade mark.

[9] The High Court decided that the appellant had successfully established all the elements under s 38 of the TMA 1976, and that the respondents had infringed the trade mark.

[10] The High Court also held that the respondents could not rely on s 40(1)(a) of the TMA 1976 as it was not pleaded in their defence. This subsection promulgates the use of the trade mark in good faith by a person in his own name, in order to avoid an infringement of the trade mark under s 38(1) of the 1976.

[11] Being dissatisfied with the decision of the High Court, the respondents filed a Notice of Appeal to the Court of Appeal. On 23 April 2015, the Court of Appeal allowed the respondents' appeal and set aside the whole decision of the High Court. The Court of Appeal held the view that the trade mark had been used by the respondents with the consent and approval of the appellant.