Singapore Trade Marks Registry: A co-owner of goodwill cannot succeed in a passing off action against another co-owner

In Chua Beng Hock v FM Skincare Pte Ltd,^[1] the Singapore Trade Marks Registry ruled for the first time that a co-owner of goodwill cannot succeed in a passing off action against another co-owner. The decision also provides helpful guidance on how the ownership of goodwill in a business conducted under an unregistered trade mark is to be determined, particularly where the business was owned and controlled by different entities at various points in time and there was no formal agreement amongst the key players as to the entity which is to control the use of the mark or own the goodwill.

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A tale of two brothers

The story started with a pair of twin brothers who operated a skincare salon targeted at male customers. The salon was aptly named “Face of Man”. 

Over time, the business evolved and expanded - new “Face of Man” outlets were opened, other partners or shareholders were added to the mix, and different corporate vehicles were set up to operate the various outlets and deal with matters like franchising.

One brother (“the Initiator”) eventually left the business. Some years later, FM Skincare Pte Ltd (“the Respondent”) applied to register the logo mark "" and the word mark “faceofman”, in respect of cosmetics in Class 3 and slimming and skin care services in Class 44. The Initiator challenged both marks on various grounds including bad faith, passing off, copyright and well-known mark, but was ultimately successful.

The Principal Assistant Registrar Mr. Gabriel Ong (“PAR”) found that the key players never expressly agreed among themselves as to which entity held ultimate control over the “Face of Man” name and get-up. He also found that the Respondent or its predecessors had directly or indirectly managed all the “Face of Man” outlets, except for the first one. Accordingly, the Initiator failed on all grounds.

This article focuses on the Registry’s rulings in relation to goodwill in the business conducted under the “Face of Man” name, and the impact of these rulings on the grounds of passing off and well-known mark. The bad faith and copyright grounds were not made out on the facts.

No exclusive ownership of goodwill

The success of the passing off ground is premised on a finding of notional passing off, which relies on proof of goodwill, misrepresentation and damage.

The authorities suggest that to determine the ownership of goodwill, two questions need to be asked: (i) who is perceived by the public as being responsible for the character or quality of the goods or services in question; and (ii) who is actually responsible. 

The PAR considered that, in this case, owing to the multiple individuals and outlets involved, while public perception was relevant, it was not definitive. Instead, actual control over the business was particularly significant in the circumstances.

In any event, the application of both tests led to the same conclusion. On the evidence, the PAR considered that the goodwill could not be said to be owned by the Initiator alone, for the following reasons:

• Public perception test - On the evidence, the public regarded both twins as being equally or jointly responsible for the character and quality of the goods or services offered under “Face of Man” name.
   
• Actual control test - On the evidence, the Initiator did not have exclusive control over the use of the name or the business, as all key decisions were undertaken by all the key partners or shareholders at any point in time.

Accordingly, the Initiator was at best a co-owner of goodwill, with the Respondent being at the very least also a co-owner of goodwill. Notably, the PAR declined to decide whether the Initiator was in fact a co-owner of goodwill as it was unnecessary for him to find on this issue.

The PAR’s approach can be compared with that taken by the Singapore High Court in New Ping Ping Pauline v Eng’s Noodles House Pte Ltd^[2] (“Eng’s”). There, ownership of goodwill was considered in connection with a counterclaim for passing off. 

In Eng’s, it was uncontroversial that the founder of the noodle business, Mr. Ng, was its “walking brand” and “main figurehead that customers identified with”. The goodwill was thus found to have attached itself to the business of the company through which Mr. Ng operated. The question was whether the goodwill vested in the members of the Ng family (who were the counterclaimants) after the company ceased operations, entitling them to sue for passing off. 

The counterclaimants failed to establish this. There was no evidence that the goodwill had been assigned to them; the counterclaimants’ purported “substantial and critical contributions” to the operations of the company were also found to be insufficient to move the needle insofar as this did not result in the public associating the noodles with them. In this regard, the High Court, citing the English case of Gromax Plasticulture v Don & Low Nonwoens Ltd^[3] (“Gromax”), considered the issue of contribution to be a mere factor to be considered in ascertaining the public perception, rather than an independent test. 

The different approaches – taken by the PAR and in Eng’s - illustrate how the test(s) to apply may depend on the circumstances of the case - where the public may be less concerned with identifying or distinguishing between the individuals or entities associated with the business, public perception may be less relevant. In such a case, actual control will likely have to be considered independently, and could well be the more important test.

Passing off ground - Failed

Having found that the Initiator was at best a co-owner of goodwill, the PAR concluded that the passing off ground must fail because a co-owner of goodwill cannot succeed in establishing passing off against another co-owner, relying on Gromax.

The reasoning, as set out in Gromax, is that a plaintiff in a passing off claim has the onus of proving that it has the monopoly and sole right to use the mark question, and a co-owner of goodwill would not be able to discharge this onus vis-à-vis another co-owner.

For good measure, the PAR also found that even if the Initiator had exclusive ownership of goodwill, there was no misrepresentation (i.e., the 2^nd element of passing off) because the subject marks were the same marks which the Respondent and its predecessors had been using and authorising its franchisees to use.

Well-known mark ground - Failed

The well-known mark was relied on only in the invalidation action against the word mark “faceofman”. To succeed on this ground, the Initiator had to show he was the owner of a well-known mark, and that the registration conflicted with the same.

Given the PAR’s findings on goodwill, this ground failed because the Initiator could not show that he was the owner of the “faceofman” mark, and thereby could not be said to own any well-known mark.

The PAR observed that ownership of well-known trade marks may not be tied to goodwill (which attaches to a business in the jurisdiction) where the complainant is relying on use or registration of the mark overseas. However, where all the parties are domestic, as in this case, the owner of the unregistered trade mark and that of any well-known mark must be one and the same.

Take-aways

This decision serves as a cautionary tale for businesses which are operated informally, within a circle of family and friends. In such scenarios, it is often thought to be unnecessary to enter into formal agreements to document the individuals’ intentions as to the ownership of different rights in the business. This oftentimes leads to evidential difficulties down the line if the parties’ relationship breaks down, and there is a dispute over trade marks and other rights. 

The best tack is to ensure that the key trade marks that are used in the business are registered from the outset. The key players will have to agree on the entity in which name the registrations are to be filed and held. If other entities need to use the trade marks, they will need a licence from the trade mark owner. Further, if the intention is not to share the goodwill, the licence agreement should provide that any goodwill arising from the former’s use of the mark will accrue to the trade mark owner. 

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The Bird & Bird team comprising Pin-Ping Oh (Partner) and Brendan Loy (Associate) from Singapore successfully represented the Respondent in this matter.

[1] [2025] SGIPOS 2

[2] [2021] 4 SLR 1317

[3] [1999] RPC 367

This article is produced by our Singapore office, Bird & Bird ATMD LLP. It does not constitute as legal advice and is intended to provide general information only. Information in this article is accurate as of 3 July 2025.