If you own the domain name will you also have the exclusive right to the name?

Jan 26, 2016 | 2015, News

In the recent case of Fairhaven Country Estate (Pty) Ltd v Harris and Another 2015 (5) SA 540 (WCC) the Western Cape High Court decided that a domain name registrant does not have the exclusive right to the name.

The facts of the case were essentially that there was an estate agent and a property developer both interested in a residential property known as Fairhaven who started a business relationship with one another. Prior to this arrangement the estate agent had registered a few .co.za domain names incorporating the ‘Fairhaven’ name, such as fairhaven.co.za and fairhavencountryestate.co.za, in an attempt to help him secure the selling rights for the property development. Subsequently, the property developer incurred huge costs creating a website using one of the domain names in order to market the property, unbeknown to it that the domain name was registered in the name of the estate agent. After the relationship fell apart, the estate agent advised that he intended transferring his domain names into the name of a third party. This quickly prompted the property developer to seek a court interdict based on passing off, ordering the transfer of the domain names into its name as well as restraining the estate agent from registering further domain names containing the name ‘Fairhaven’. The property developer was granted the court order with costs.

The judge held that prior to the association between the estate agent and the property developer the domain names held no value. It was only after the property developer had created the website and spent a significant amount on marketing the property that the domain name had acquired value and such reputation was attributable to the property developer. Accordingly, the property developer had “clearly established an inextricable link between the domain names and its name”, being Fairhaven Country Estate (Pty) Ltd. He found that just because the estate agent had registered the domain names did not result in him having the exclusive right to use the domain names. The judge further ruled that although there had not as yet been a misrepresentation, there was “a clear intention that (the estate agent) intends passing off his business as being that of the applicant”.

Generally domain name disputes in South Africa regarding .co.za domain names are dealt with using the Alternative Dispute Resolution procedure established in terms of the Electronic Communications and Transmissions Act. This route is usually regarded as being more cost effective and quicker. However, as this case illustrates, one can also approach the courts in order to resolve such a matter.