By:- Palav Agarwal
Laches is an “unreasonable delay pursuing a right or claim.”
In a way that prejudices the [opposing] party. When asserted in litigation, it is an equitable defense, or doctrine. The person invoking laches is asserting that an opposing party has “slept on its rights,” and that, as a result of this delay, circumstances have changed such that it is no longer just to grant the plaintiff’s original claim. Put another way, failure to assert one’s rights in a timely manner can result in a claim’s being barred by laches. Laches is a form of estoppel for delay. In Latin,
The French Philosophers ones said in the way of defining Laches as being:
Vigilantibus non dormientibus æquitas subvenit.
Equity aids the vigilant, not the sleeping ones (that is, those who sleep on their rights).
DOCTRINE OF LACHES
Black’s Law Dictionary 6th Edition.
Laches/laechaz/leychez/laeshez/. “Doctrine of laches” is based upon maxim that equity aids the vigilant and not those who slumber on their rights. It is defined as neglect to assert a right or claim which, taken together with lapse of time and other circumstances causing prejudice to adverse party, operates as bar in court of equity. Wooded Shores Property Owners Ass’n Inc. v. Mathews, 37 Ill. App.3d 334, 345 N.E.2d. 186, 189. The neglect for an unreasonable and unexpained length of time under circumstances permitting diligence, to do what in law, should have been done.
In most contexts, an essential element of laches is the requirement that the party invoking the doctrine has changed its position as a result of the delay. In other words, the defendant is in a worse position now than at the time the claim should have been brought. For example, the delay in asserting the claim may have caused a great increase in the potential damages to be awarded, or assets that could earlier have been used to satisfy the claim may have been distributed in the meantime, or the property in question may already have been sold, or evidence or testimony may no longer be available to defend against the claim.
A defense lawyer raising the defense of laches against a motion for injunctive relief (a form of equitable relief) might argue that the plaintiff comes “waltzing in at the eleventh hour” when it is now too late to grant the relief sought, at least not without causing great harm that the plaintiff could have avoided. In certain types of cases (for example, cases involving time-sensitive matters, such as elections), a delay of even a few days is likely to be met with a defense of laches, even where the applicable statute of limitations might allow the type of action to be commenced within a much longer time period.
A successful defense of laches will find the court denying the request for equitable relief. However, even if equitable relief is not available, the party may still have an action at law if the statute of limitations has not run out.
Under the United States Federal Rules of Civil Procedure, laches is an affirmative defense, which means that the burden of asserting laches is on the party responding to the claim to which it applies. “When the defense of laches is clear on the face of the complaint, and where it is clear that the plaintiff can prove no set of facts to avoid the insuperable bar, a court may consider the defense on a motion to dismiss.” Solow v. Nine West Group, 2001 WL 736794, *3 (S.D.N.Y. June 29, 2001); Simons v. United States, 452 F.2d 1110, 1116 (2d Cir. 1971) (affirming Rule 12(b)(6) dismissal based, in part, on laches where papers “reveal no reason for the inordinate and prejudicial delay”)
Doctrine of Estoppel:-
Estoppel in its broadest sense is a legal term referring to a series of legal and equitable doctrines that preclude “a person from denying or asserting anything to the contrary of that which has, in contemplation of law, been established as the truth, either by the acts of judicial or legislative officers, or by his own deed, acts, or representations, either express or implied.”
This term appears to come from the Old French estoupail (or variation), which meant “stopper plug”, referring to placing a halt on the imbalance of the situation. The term is related to the verb “estop” which comes from the Old French term estopper, meaning “stop up, impede.”
Where a court finds that a party has done something warranting a form of estoppel, that party is said to be “estopped” from making certain related arguments or claiming certain related rights. The defendant is said to be “estopped” from presenting the related defence, or the plaintiff is said to be “estopped” from making the related argument against the defendant. Lord Coke stated, “It is called an estoppel or conclusion, because a man’s own act or acceptance stoppeth or closeth up his mouth to allege or plead the truth.
Because estoppel is so factually dependent, it is perhaps best understood by considering specific examples.
• Example 1: A city entered into a contract with another party. The contract stated that it had been reviewed by the city’s counsel and that the contract was proper. Promissory estoppel applied to estop the city from claiming the contract was invalid.
• Example 2: The creditor unofficially informs the debtor that the creditor forgives the debt. Even if such forgiveness is not formally documented, the creditor may be estopped from changing its mind and seeking to collect the debt, because that change would be unfair.
• Example 3: A landlord informs a tenant that rent has been reduced, for example, because there was construction or a lapse in utility services. If the tenant relies on this notice in choosing to remain in the premises, the landlord could be estopped from collecting the full rent.
Estoppel is closely related to the doctrines of waiver, variation, and election and is applied in many areas of law, including insurance, banking, employment, international trade, etc. In English law, the concept of legitimate expectation in the realm of administrative law and judicial review is estoppel’s counterpart in public law, although subtle but important differences exist.
The main species of estoppel under English, Australian, and American laws are:
• Reliance-based estoppels—These involve one party relying on something the other party has done or said. The party who performed/spoke is the one who is estopped. Under English law, this class includes estoppel by representation of fact, promissory estoppel and proprietary estoppel (see Halsbury’s Laws of England, Vol 16(2), 2003). Although some authorities have used language to suggest reliance-based estoppels are mere rules of evidence, they are rules of substantive law.
o Estoppel by representation of fact (English law name), equitable estoppel (American law)
o Equitable estoppel (in English law), including
- Proprietary estoppel
- Promissory estoppel
• Estoppel by record—This frequently arises as issue/cause of action estoppel or judicial estoppel where the orders or judgments made in previous legal proceedings prevent the parties from relitigating the same issues or causes of action,
• Estoppel by deed (often regarded as technical or formal estoppels)—Where rules of evidence prevent a litigant from denying the truth of what was said or done
• Estoppel by silence—Estoppel that prevents a person from asserting something when he had the right and opportunity to do so earlier, and such silence put another person at a disadvantage.
• Laches—estoppel in equity by delay. Laches has been considered both a reliance-based estoppel, and a sui generis estoppel.
Elements of Laches:-
1. Unreasonable lapse of time.
2. Neglect to assert a right or claim.
3. To the detriment of another.
If these three elements are met, then the Doctrine of Laches will act as a bar in court.
If an adverse party unreasonably delays informing you of a right or claim and this results in permanent damage to your ability to defend your self then such a claim may be barred from court.
1.Unreasonable lapse of time:-
A defense to an equitable action, that bars recovery by the plaintiff because of the plaintiff’s undue delay in seeking relief.
Laches is a defense to a proceeding in which a plaintiff seeks equitable relief. Cases in Equity are distinguished from cases at law by the type of remedy, or judicial relief, sought by the plaintiff. Generally, law cases involve a problem that can be solved by the payment of monetary damages. Equity cases involve remedies directed by the court against a party.
Types of equitable relief include Injunction, where the court orders a party to do or not to do something; declaratory relief, where the court declares the rights of the two parties to a controversy; and accounting, where the court orders a detailed written statement of money owed, paid, and held. Courts have complete discretion in equity, and weigh equitable principles against the facts of the case to determine whether relief is warranted.
The rules of equity are built on a series of legal maxims, which serve as broad statements of principle, the truth and reasonableness of which are self-evident. The basis of equity is contained in the Maxim “Equity will not suffer an injustice.” Other maxims present reasons for not granting equitable relief. Laches is one such defense.
Laches is based on the legal maxim “Equity aids the vigilant, not those who slumber on their rights.” Laches recognizes that a party to an action can lose evidence, witnesses, and a fair chance to defend himself or herself after the passage of time from the date the wrong was committed. If the defendant can show disadvantages because for a long time he or she relied on the fact that no lawsuit would be started, then the case should be dismissed in the interests of justice.
The law encourages a speedy resolution for every dispute. Cases in law are governed by STATUTES OF LIMITATIONS, which are laws that determine how long a person has to file a lawsuit before the right to sue expires. Different types of injuries (e.g., TORT and contract) have different time periods in which to file a lawsuit. Laches is the equitable equivalent of statutes of limitations. However, unlike statutes of limitations, laches leaves it up to the court to determine, based on the unique facts of the case, whether a plaintiff has waited too long to seek relief.
Real estate boundary disputes are resolved in equity and may involve laches. For instance, if a person starts to build a garage that extends beyond the boundary line and into a neighbor’s property, and the neighbor immediately files a suit in equity and asks the court to issue an injunction to stop the construction, the neighbor will likely prevail. On the other hand, if the neighbor observes the construction of the garage on her property and does not file suit until the garage is completed, the defendant may plead laches, arguing that the neighbor had ample time to protect her property rights before the construction was completed, and the court may find it unfair to order that the garage be torn down.
The laches defense, like most of equity law, is a general concept containing many variations on the maxim. Phrases used to describe laches include “delay that works to the disadvantage of another,” “inexcusable delay coupled with prejudice to the party raising the defense,” “failure to assert rights,” “lack of diligence,” and “neglect or omission to assert a right.”
Compared to statute of limitations:-
The defense of laches resembles, but is not entirely analogous to, a plea that the period of time allowed under a statute of limitations has expired. Laches essentially alleges prejudicial delay and unfairness in the context of a particular situation, whereas statutes of limitation tend to define a specific legally prescribed period of time (after the cause of action has accrued) within which a lawsuit for a particular type of cause of action may be commenced or after which the right to recovery is barred. Moreover, although a lawsuit commenced within the time allowed by a limitations period is valid no matter how long it takes for the action to proceed to trial, laches can sometimes be applied even in a situation where a lawsuit has been commenced and any delays would otherwise be reasonable. It is generally allowed by a court when a defendant could reasonably have believed that the plaintiff was not going to exercise his or her legal rights and acted on that belief to his or her detriment.
2. Neglect to assert a right or claim:-
A neglect to assert a right or claim may operate as a right to waiver. A waiver is the voluntary relinquishment or surrender of some known right or privilege.
While a waiver is often in writing, sometimes a person’s actions can act as a waiver. An example of a written waiver is a disclaimer, which becomes a waiver when accepted. Other names for waivers are exculpatory clauses, releases, or hold harmless clauses.
Sometimes the elements of “voluntary” and “known” are established by a legal fiction. In this case, one is presumed to know one’s rights and that those rights are voluntarily relinquished if not asserted at the time.
In civil procedure, certain arguments must be raised in the first objection that a party submits to the court, or else they will be deemed waived.
The following represent a general overview of considerations; specifics may vary dramatically depending on the jurisdiction.
Key factors that some courts (depending on jurisdiction) may look at when determining the applicability of a waiver:
• In some jurisdictions, one may not prospectively waive liability for some or all intentional activities.
• Waivers generally must be made voluntarily and with the full knowledge (or the ability to know) of the right being waived.
• The waiver should be unambiguous and clear to a reasonable person.
• In some jurisdictions (not including the United States), it may be necessary that the parties to the waiver have equal bargaining power.
• A waiver may have limited application where one contracts for an “essential service” such that it may violate public policy for liability to be waived.
• In the case of Insurance Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694 (1982) the United States Supreme Court decided that when a court orders a party to produce proof on a certain point, and that party refuses to comply with the court’s order, the court may deem that refusal to be a waiver of the right to contest that point and assume that the proof would show whatever the opposing party claims that it would.
• In that court case, the defendant had argued that the court lacked personal jurisdiction over it but refused a court order to produce evidence of this lack of jurisdiction. The defendant argued the circular logic that, because the court lacked jurisdiction, the court had no authority to issue an order to show proof of the lack of jurisdiction. The Supreme Court rejected that argument and determined that the defendant’s refusal to comply waived the right to contest jurisdiction, just as if it had never contested jurisdiction at all.
3. To the detriment of another:-
In the happening of an event when the disadvantage of the party allows the other party to not to assert the right or the claim within the reasonable time happens to be an element of laches.
In the event of causing loss of marriage of the defendant the petitioner may not present the original photographs of the marriage so that the marriage is held null and void. And if the petitioner comes to know about the same after the lapse of reasonable time it might be the case of laches and the court may may presume the same.
Laches and Acquiescence:-
Acquiescence, consenting by remaining silent, relates to the failure in objecting to the use of the label and to the registration of the label as a trademark while laches is the undue delay in asserting a right or bringing a suit or complaint which may be used as a defense if loss or prejudice is proved to have been caused by the plaintiff’s delay. Acquiescence implies positive acts, a course of conduct inconsistent with the claim for exclusive right. The Supreme Court in Midas Hygiene Industries (P) Ltd. and Anr. v. Sudhir Bhatia ((2004) 3 SCC 90) held that in cases of infringement of a trademark or a copyright, it is well settled that normally an injunction must follow. It was observed that mere delay in bringing an action is not sufficient to defeat the grant of an injunction in such cases. The grant of an injunction also becomes necessary if it prima facie appears that the adoption of the infringed trademark was dishonest.
In Swaran Singh Trading as Appliances Emporium v. M/s Usha Industries (India) New Delhi (AIR 1986 Delhi 343), this Court held that registration of a trademark gives an exclusive right of use to the proprietor of the registered trademark with the condition that if there is a user prior to the date of registration, then that user may continue, the effect of which is that even if there is some delay in enforcing the statutory right, the exclusive right of user cannot be lost. The principles governing other types of injunctions are not to be readily applied to the infringement of a trademark. It is the duty of the Court to protect a registered trademark because in such a case the public is deceived into purchasing the defendant’s goods on the belief that they are the plaintiff’s goods. An injunction cannot be refused even if there is some delay in such a case because that would tantamount to permitting a fraud being practiced on unwary customers. It was further held that a delay in the matter of seeking an injunction may be a ground for refusing it in certain circumstances but a statutory right cannot be lost by delay. The defence of laches or inordinate delay is a defence in equity. If there is honest concurrent use by the defendant, then inordinate delay and laches may defeat the claim of damages or rendition of account but the relief of injunction should not be refused keeping in mind the interest of the general public (M/s Hindustan Pencils Pvt. Ltd. v. M/s India Stationery Products Co. and Ors., AIR 1990 Delhi 19). The principle that merely because the injunction application has remained pending for about years does not mean that defendants be allowed to continue to infringe the plaintiffs trademark as they cannot be permitted to take advantage of the laws delays, has been enunciated by the Delhi High Court recently in Fedders North American v. Show line (IA No.- 5662/1998 in CS(OS) No.- 1384/1998).
In the present case the plaintiff ‘Fedders’, a Corporation incorporated in USA, carried on an established business of manufacturing and trading wide range of air-conditioners, split air-conditioners, de-humidifiers, air-conditioning machinery, etc. under the trademark ‘Fedders’. It entered into agreement with Lloyd Electric and Engineering Company (LEECO) granting them the sole and exclusive right and license to assemble, manufacture and sell its product for a period of 5 years starting 30th June, 1956 with a condition that upon termination or cancellation of the agreement LEECO should discontinue use of the trade name or label ‘Fedders’. Despite that agreement LEECO applied for registration of trademark ‘Fedders’ which though registered in favour of LEECO was assigned by LEECO to the plaintiff on their objection for registration who then became the registered proprietor of the trademark. While the application for registration was pending, LEECO incorporated the defendant to take over the business of LEECO. The agreement was successfully executed for 5 years and both the parties again entered into royalty license agreement in 1963 granting the defendant the sole and exclusive right and license for a period of five years.
After the completion of 5 years both the parties tried to negotiate for extension but failed to reach any conclusion. The plaintiff then filed suit in Calcutta High Court, which alleged the infringement of plaintiff’s trademark and passing off for which interim injunction was passed by learned Single Judge but was stayed by the Division Bench which was later on dismissed in 1999 for non-prosecution.
The defendants had filed another suit which alleged that as the plaintiff did not use the trademark ‘Fedders’ for a period of more than 5 years, it be removed from the register, which was dismissed by the learned Single Judge and also in appeal on the ground that the plaintiff ably satisfied the court that non-use of the trademark was due to special circumstances in the trade. The case further settled following issues:
i) What was the effect of the trademark or trade name ‘Fedders’ being registered in the name of the plaintiff?
ii) Whether an ex-licencee can claim any right over a trademark of its former licensor?
iii) Whether the plaintiff was guilty of undue delay and laches?
iv) Whether the continued use of the trademark ‘Fedders’ by the Defendant was a continuing wrong?
The Supreme Court in Kaviraj Pandit Durga Dutt Sharma v. Navaratna Pharmaceutical Laboratories (AIR 1965 SC 980), has settled that an action for infringement is a statutory remedy conferred on the proprietor of a registered trademark for the vindication of its exclusive right to the use of that trademark in relation to its goods. It was further held that in case of infringement in the course of trade, the question whether there has been an infringement is to be decided by comparison of the two marks. Where the two marks are identical no further questions arise, for then the infringement is made out.
Registration of a trademark gives the exclusive right to use that trademark in connection with goods in respect of which it is registered, and if there is any invasion of this right by any other person using the mark, which is the same or deceptively similar to that trademark, he can protect his trademark by an action for infringement. The registration of the trademark is prima facie evidence of its validity. In the Fedders’ case after the agreement period came to an end, defendant had no right to use the trademark ‘Fedders’, which was the exclusive property of the plaintiff. The continued use of the trademark ‘Fedders’ by defendant after the agreement period was unauthorised and in violation of the rights available to the plaintiff as the registered proprietor of the trademark ‘Fedders’.
It is a settled principle of law relating to trademarks that there can be only one mark, one source and one proprietor. A trademark cannot have two origins (Power Control Appliances v. M/s Sumeet Machines Pvt. Ltd., JT 1994 (2) SC 17). In Velcro Industries v. Velcro India Ltd., (1993 (1) Arb. LR 465) the learned Single Judge of the Bombay High Court rejected the contention of the defendants that they were entitled to continue use of ‘Velcro’ as a part of their corporate name because they have had independently developed a reputation in India. The court further held that the defendants in that case were merely acting as licensees and even if the agreement between the parties did not provide that on termination of the licence, the defendants would cease to use ‘Velcro’ as a part of their trade name, that would make no difference, since the trademark ‘Velcro’ was a registered trademark of the plaintiff and to allow the defendants to use it as a part of their corporate name would be to permit them to give an impression to the public that they were still connected with or had a licence from the plaintiffs. But the Fedders’ case the agreements between the parties made it absolutely clear that after termination of the agreements, neither LEECO nor defendant would be entitled to use the trademark ‘Fedders’.
The continued use of the trademark ‘Fedders’ by the defendant was a continuing wrong and therefore the dismissal of Calcutta suit for non-prosecution was of neither of any consequence nor was a res judicata which prevented plaintiff from filing a fresh suit on other or further causes of action. Whenever and wherever a person commits breach of a registered trademark of another he commits a recurring act of breach or infringement of such trademark giving a recurring and fresh cause of action on each time of such infringement to the party aggrieved. The court further held: “No one can be allowed to ride piggyback on the name of another and if one does so by infringing the trademark of another, it is but natural that the proprietor of the trademark will suffer injury to its name and reputation”.
Thus the Delhi High Court has restrained the defendant from cashing in on the reputation of well-established Fedders North American Corporation of the US.
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