Rhone-Poulenc Rorer International Holdings Inc & Anor v Yeda Research and Development Co Ltd [2006] EWHC 160 (Ch)

[2006] EWHC 160 (CH)Case No CH2005APP0795
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 16/02/2006
Before
MR JUSTICE LEWISON
Between
(1) RHONE-POULENC RORER INTERNATIONAL HOLDINGS INCAppellants(2) IMCLONE SYSTEMS INCAppellantYEDA RESEARCH AND DEVELOPMENT CO LTDRespondentTHE COMPTROLLER OF PATENTS DESIGNS AND TRADEMARKSIntervener
Mr Daniel Alexander QC and Mr Michael Tappin (instructed by Milbank, Tweed, Hadley & McCloy LLP) for ImClone Systems IncMr Andrew Lykiardopoulos (instructed by Bird & Bird) for Rhone-Poulenc Rorer International Holdings IncMr Christopher Floyd QC and Mr Tim Powell (instructed by Bristows) for Yeda Research and Development Co LtdMr Michael Edenborough (instructed by the Treasury Solicitor) for Comptroller of Patents Designs and Trademarks (intervening)Hearing Hearing dates: January 30 th 31st
JUDGMENT
[1]On 20 October 2005 Mr RC Kennell, acting as Hearing Officer, allowed certain amendments to a written statement filed in support of a reference to the Comptroller of Patents under section 37 of the Patents Act 1977. Under this section the Comptroller has power to determine questions of entitlement to proprietary interests in patents that have been recently granted.[2]The patent in suit relates to therapeutic compositions containing certain monoclonal antibodies in combination with anti-neoplastic drugs. The antibodies are specific to a human receptor for epidermal growth factor (“EGF”) and can inhibit the growth of human tumour cells that express human EGF receptors by binding to the extra-cellular domain of the receptors to form an antigen-antibody complex. The invention rests on the discovery that the combined treatment is more efficient than the use of either agent by itself because it kills the cancer cells (a cytotoxic effect) rather than merely prevents them from replicating (a cytostatic effect). It also allows the use of lower amounts of toxic or sub-toxic anti-neoplastic drugs.[3]The grant of the patent in suit was mentioned in the European Patent Bulletin on 27 March 2002. The reference to the Comptroller was made on 26 March 2004, one day short of two years later. The reference claimed joint ownership of the patent. However, on 29 June 2005 the referrer (“Yeda”) filed an amended statement, in which a claim was advanced to sole ownership of the patent. The twin grounds on which the claim to sole ownership was advanced can be briefly summarised as: i) The contribution made to the inventive concept by the named inventors was insufficient to entitle them to any proprietary interest in the patent; and ii) In the alternative one or both of the inventors named in the grant was an employee of an academic institution at the material time, with the consequence that their invention belonged to his employer; and their employer had assigned those rights to Yeda.[4]The registered proprietor of the patent (“Rorer”) and a licensee under the patent (“ImClone”) objected to the amendments. The ground of the objection was that the amendments were made out of time by reason of the effect of section 37 (5) of the Patents Act 1977. The argument was that: i) Section 37 (5) imposed a two year limitation period for claiming entitlement to a patent that had already been granted; ii) A claim to sole ownership in addition to a claim to joint ownership should count as a new claim for this purpose; iii) In deciding whether to allow an amendment to be made which had the effect of making a new claim the Hearing Officer should apply the criteria set out in CPR rule 17.4; iv) The proposed amendment did not satisfy those criteria; and v) Therefore the amendments should not be allowed.[5]The Hearing Officer allowed the amendments. He held that he was not required to apply the criteria set out in CPR rule 17.4 but had a discretion to allow the amendments. He exercised his discretion in favour of allowing them. ImClone and Rorer appeal. I will return in more detail both to the amendment and to the Hearing Officer’s reasons for his decision after I have considered the legal questions that have arisen on the appeal.[6]Unfortunately the focus of the appeal shifted during the course of the hearing, with the result that some of the questions raised have not been the subject of full oral argument. That, I regret to say, was largely my fault. In particular the hearing before the Hearing Officer and the first day of the appeal itself were conducted on the assumption that, if the amendments were allowed to stand, they would “relate back” to the date of the original reference. Because this fundamental assumption was questioned during the course of the appeal, I invited the parties to make written submissions on it if they wished to. All parties made additional written submissions, for which I am grateful. The legislative framework Community legislation

The legislative framework

[7]Articles 23 and 24 of the Community Patents Convention (“the CPC”) are part of a section of the Convention entitled “Substantive Patent Law”. Article 23 of the CPC says:
“1. If a Community patent has been granted to a person who is not entitled to it under Article 60 (1) of the European Patent Convention, the person entitled to it under that provision may, without prejudice to any other remedy which may be open to him, claim to have the patent transferred to him. 2. Where a person is entitled to only part of a Community patent, that person may in accordance with paragraph 1, claim to be a joint proprietor. 3. Legal proceedings in respect of the rights specified in paragraphs 1 and 2 may be instituted only within a period of two years after the date on which the European Patents Bulletin mentions the grant of the European patent. This provision shall not apply if the proprietor of the patent knew, at the time the patent was granted or transferred to him, that he was not entitled to the patent.”
[8]Article 24 says (so far as material):
“1. Where there is a complete change of proprietorship of a Community patent as a result of legal proceedings under Article 23, licences and other rights shall lapse upon the registration of the person entitled to the patent in the Register of Community Patents. 2. If, before the institution of the legal proceedings has been registered, (a) the proprietor of the patent has used the invention within the territory of any of the Contracting States or made effective and serious preparations to do so, or (b) a licensee of the patent has obtained his licence and has used the invention within the territory of any of the Contracting States or made effective and serious preparations to do so, he may continue such use provided that he requests a non-exclusive licence of the patent from the new proprietor whose name is entered in the Register of Community Patents.”

The Patents Act

[9]Section 37 of the Patents Act 1977 says:
“(1) After a patent has been granted for an invention any person having or claiming a proprietary interest in or under the patent may refer to the comptroller the question— (a) who is or are the true proprietor or proprietors of the patent, (b) whether the patent should have been granted to the person or persons to whom it was granted, or (c) whether any right in or under the patent should be transferred or granted to any other person or persons; and the comptroller shall determine the question and make such order as he thinks fit to give effect to the determination. (2) Without prejudice to the generality of subsection (1) above, an order under that subsection may contain provision— (a) directing that the person by whom the reference is made under that subsection shall be included (whether or not to the exclusion of any other person) among the persons registered as proprietors of the patent; (b) directing the registration of a transaction, instrument or event by virtue of which that person has acquired any right in or under the patent; (c) granting any licence or other right in or under the patent; (d) directing the proprietor of the patent or any person having any right in or under the patent to do anything specified in the order as necessary to carry out the other provisions of the order. (3) If any person to whom directions have been given under subsection (2)(d) above fails to do anything necessary for carrying out any such directions within 14 days after the date of the order containing the directions, the comptroller may, on application made to him by any person in whose favour or on whose reference the order containing the directions was made, authorise him to do that thing on behalf of the person to whom the directions were given. (4) Where the comptroller finds on a reference under this section that the patent was granted to a person not entitled to be granted that patent (whether alone or with other persons) and on an application made under section 72 below makes an order on the ground for the conditional or unconditional revocation of the patent, the comptroller may order that the person by whom the application was made or his successor in title may, subject to section 76 below, make a new application for a patent— (a) in the case of unconditional revocation, for the whole of the matter comprised in the specification of that patent; and (b) in the case of conditional revocation, for the matter which in the opinion of the comptroller should be excluded from that specification by amendment under section 75 below; and where such a new application is made, it shall be treated as having been filed on the date of filing the application for the patent to which the reference relates. (5) On any such reference no order shall be made under this section transferring the patent to which the reference relates on the ground that the patent was granted to a person not so entitled, and no order shall be made under subsection (4) above on that ground, if the reference was made after the end of the period of two years beginning with the date of the grant, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or, as the case may be, of the transfer of the patent to him that he was not entitled to the patent. (6) An order under this section shall not be so made as to affect the mutual rights or obligations of trustees or of the personal representatives of a deceased person, or their rights or obligations as such. (7) Where a question is referred to the comptroller under this section an order shall not be made by virtue of subsection (2) or under subsection (4) above on the reference unless notice of the reference is given to all persons registered as proprietor of the patent or as having a right in or under the patent, except those who are parties to the reference. (8) If it appears to the comptroller on a reference under this section that the question referred to him would more properly be determined by the court, he may decline to deal with it and, without prejudice to the court’s jurisdiction to determine any such question and make a declaration, or any declaratory jurisdiction of the court in Scotland, the court shall have jurisdiction to do so. (9) The court shall not in the exercise of any such declaratory jurisdiction determine a question whether a patent was granted to a person not entitled to be granted the patent if the proceedings in which the jurisdiction is invoked were commenced after the end of the period of two years beginning with the date of the grant of the patent, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or, as the case may be, of the transfer of the patent to him that he was not entitled to the patent.”
[10]Section 72 says, so far as material:
“(1) Subject to the following provisions of this Act, the court or the comptroller may . . . by order revoke a patent for an invention on the application of any person (including the proprietor of the patent) on (but only on) any of the following grounds, that is to say— (a) [… ]; (b) that the patent was granted to a person who was not entitled to be granted that patent; […] (2) An application for the revocation of a patent on the ground mentioned in subsection (1)(b) above— (a) may only be made by a person found by the court in an action for a declaration or declarator, or found by the court or the comptroller on a reference under section 37 above, to be entitled to be granted that patent or to be granted a patent for part of the matter comprised in the specification of the patent sought to be revoked; and (b) may not be made if that action was commenced or that reference was made after the end of the period of two years beginning with the date of the grant of the patent sought to be revoked, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or of the transfer of the patent to him that he was not entitled to the patent.”
[11]Section 38 deals with the effect of certain kinds of order made under section 37. It says: “(1) Where an order is made under section 37 above that a patent shall be transferred from any person or persons (the old proprietor or proprietors) to one or more persons (whether or not including an old proprietor), then, except in a case falling within subsection (2) below, any licences or other rights granted or created by the old proprietor or proprietors shall, subject to section 33 above and to the provisions of the order, continue in force and be treated as granted by the person or persons to whom the patent is ordered to be transferred (the new proprietor or proprietors). (2) Where an order is so made that a patent shall be transferred from the old proprietor or proprietors to one or more persons none of whom was an old proprietor (on the ground that the patent was granted to a person not entitled to be granted the patent), any licences or other rights in or under the patent shall, subject to the provisions of the order and subsection (3) below, lapse on the registration of that person or those persons as the new proprietor or proprietors of the patent. (3) Where an order is so made that a patent shall be transferred as mentioned in subsection (2) above or that a person other than an old proprietor may make a new application for a patent and before the reference of the question under that section resulting in the making of any such order is registered, the old proprietor or proprietors or a licensee of the patent, acting in good faith, worked the invention in question in the United Kingdom or made effective and serious preparations to do so, the old proprietor or proprietors or the licensee shall, on making a request to the new proprietor or proprietors or, as the case may be, the new applicant within the prescribed period, be entitled to be granted a licence (but not an exclusive licence) to continue working or, as the case may be, to work the invention, so far as it is the subject of the new application. “[12]Section 123 gives the Secretary of State power to make rules for regulating the business of the Patent Office. The rules may provide for the procedures to be followed in connection with proceedings before the Comptroller and for prescribing time limits; and for extending time limits.[13]Section 130 (7) declares that a number of provisions of the Act, including section 37 (5) and section 72(1) and(2) are so framed as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the CPC. The Act applies to the whole of the United Kingdom.

The Patents Rules

[14]The Patents Rules 1995 were made under the rule making power contained in section 123 of the Act. There are only two relevant rules, for present purposes. Rule 54 deals with a reference to the Comptroller under section 37. It says:
“(1) A reference under section 37(1) shall be made on Patents Form 2/77 and shall be accompanied by a copy thereof and a statement in duplicate setting out fully the nature of the question, the facts upon which the person making the reference relies and the order which he is seeking.”
[15]It then deals with the sending of the statement (a “rule 54 statement”) to interested parties, who are entitled to make a counter-statement. The rule goes on to provide for “rounds” of evidence. The first “rounds” of evidence are limited to evidence “in support of [the] case” of the referrer and any opponent. There is also provision for evidence “confined to matters strictly in reply”. The rule ends:
“(6) No further evidence shall be filed by any party except by leave or direction of the comptroller. (7) The comptroller may give such directions as he may think fit with regard to the subsequent procedure.”
[16]Rule 100 says:
“(1) Subject to paragraph (2) below, any document filed in any proceedings before the comptroller may, if he thinks fit, be amended, and any irregularity in procedure in or before the Patent Office may be rectified, on such terms as he may direct. (2) In the case of an irregularity or prospective irregularity— (a) which consists of a failure to comply with any limitation as to times or periods specified in the Act or the 1949 Act or prescribed in these Rules or the Patents Rules 1968 as they continue to apply which has occurred, or appears to the comptroller is likely to occur in the absence of a direction under this rule; (b) which is attributable wholly or in part to an error, default or omission on the part of the Patent Office; and (c) which it appears to the comptroller should be rectified, the comptroller may direct that the time or period in question shall be altered but not otherwise. (3) Paragraph (2) above is without prejudice to the comptroller’s power to extend any times or periods under rule 110 or 111.”

The CPR

[17]The Civil Procedure Rules are made under section 1 of the Civil Procedure Act 1997. The rule making power is a power to make rules for the civil division of the Court of Appeal, the High Court and county courts. There is no power under that Act to make rules governing procedure in the Patent Office. The rule making body is the rules committee.[18]CPR Part 17 deals with amendments to statements of case. It starts by saying that a party can amend a statement of case without permission if it has not been served on any other party. After that he may amend his statement of case either with the permission of every other party, or with the permission of the court. CPR 17.4 says:
“(1) This rule applies where— (a) a party applies to amend his statement of case in one of the ways mentioned in this rule; and (b) a period of limitation has expired under— (i) the Limitation Act 1980; (ii) the Foreign Limitation Periods Act 1984; or (iii) any other enactment which allows such an amendment, or under which such an amendment is allowed. (2) The court may allow an amendment whose effect will be to add or substitute a new claim, but only if the new claim arises out of the same facts or substantially the same facts as a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings. (3) The court may allow an amendment to correct a mistake as to the name of a party, but only where the mistake was genuine and not one which would cause reasonable doubt as to the identity of the party in question. (4) The court may allow an amendment to alter the capacity in which a party claims if the new capacity is one which that party had when the proceedings started or has since acquired.”

The Limitation Act

[19]Finally, I should refer to the Limitation Act 1980. Section 35 of that Act deals with adding claims in pending actions. Section 35 (1) provides:
“(1) For the purposes of this Act, any new claim made in the course of any action shall be deemed to be a separate action and to have been commenced— (a) in the case of a new claim made in or by way of third party proceedings, on the date on which those proceedings were commenced; and (b) in the case of any other new claim, on the same date as the original action. (2) In this section a new claim means any claim by way of set-off or counterclaim, and any claim involving either— (a) the addition or substitution of a new cause of action; or (b) the addition or substitution of a new party; and “third party proceedings” means any proceedings brought in the course of any action by any party to the action against a person not previously a party to the action, other than proceedings brought by joining any such person as defendant to any claim already made in the original action by the party bringing the proceedings. (3) Except as provided by section 33 of this Act or by rules of court, neither the High Court nor any county court shall allow a new claim within subsection (1)(b) above, other than an original set-off or counterclaim, to be made in the course of any action after the expiry of any time limit under this Act which would affect a new action to enforce that claim. For the purposes of this subsection, a claim is an original set-off or an original counterclaim if it is a claim made by way of set-off or (as the case may be) by way of counterclaim by a party who has not previously made any claim in the action. (4) Rules of court may provide for allowing a new claim to which subsection (3) above applies to be made as there mentioned, but only if the conditions specified in subsection (5) below are satisfied, and subject to any further restrictions the rules may impose. (5) The conditions referred to in subsection (4) above are the following— (a) in the case of a claim involving a new cause of action, if the new cause of action arises out of the same facts or substantially the same facts as are already in issue on any claim previously made in the original action; and (b) in the case of a claim involving a new party, if the addition or substitution of the new party is necessary for the determination of the original action.”
[20]The condition set out in section 35 (5)(a) explains the form of CPR 17.4 (2). It does not explain the extension of CPR 17.4 to limitation periods in some other statutes, but it has been held that that extension is within the powers of the rules committee: Parsons v. George [2004] 1 WLR 3264.[21]The Limitation Act 1980, unlike the Patents Act 1977, applies to England and Wales only.

The nature of a reference under section 37

[22]Both Mr Floyd QC, appearing for Yeda, and Mr Edenborough, appearing for the Comptroller, stressed the width of the jurisdiction conferred on the Comptroller by section 37. They both accepted that the Comptroller’s jurisdiction under section 37 had to be triggered by the making of a reference. The Comptroller does not have the power to inquire into ownership of a patent if nobody asks him to. But once section 37 has been triggered by the making of a reference, the question that the Comptroller must answer is that laid down by the statute. The first of the possible questions that may be referred is: “who is or are the true proprietor or proprietors of the patent”?[23]If A is shown on the register as proprietor of the patent and B refers that question to the Comptroller, asserting his own claim to ownership of that patent, both Mr Floyd and Mr Edenborough submitted that, within the rules of natural justice, the Comptroller was entitled to determine the statutory question by deciding that neither A nor B was the owner of the patent, but that C was. Similarly, they submitted, that if B claimed against A that he was the joint owner of the patent, the Comptroller would be entitled to determine the question by deciding that B was the sole owner of the patent, even though he had not claimed to be.[24]If this submission is right, it must follow that if the Comptroller decided to transfer the determination of the question to the court under section 37 (8) the court would have the same power, since a transfer to the court empowers the court to determine “the question”. The question does not change according to the person called upon to answer it.[25]Mr Alexander QC, appearing for ImClone, submitted that a dispute about entitlement to a patent was a dispute about title, and the approach to such a dispute should be no different to that applied to a dispute about any other piece of property. Canary Wharf was his chosen example. However, in cases involving questions of title to land, the question is never; “who is the true owner of the land”? As Lord Diplock pointed out in Ocean Estates Ltd v Pinder [1969] 2 AC 19:
“Where questions of title to land arise in litigation the court is concerned only with the relative strengths of the titles proved by the rival claimants. If party A can prove a better title than party B he is entitled to succeed notwithstanding that C may have a better title than A, if C is neither a party to the action nor a person by whose authority B is in possession or occupation of the land.”
[26]Likewise at common law a defence of jus tertii could not usually be raised as a defence to a claim for interference with goods, although that position was reversed by statute: Torts (Interference with Goods) Act 1977 s. 8 (1). Even so the CPR require the third party to be identified so that he may join in the proceedings: CPR rule 19.5A.[27]Nevertheless I accept Mr Alexander’s more limited submission that a court, embarked on trying a dispute, will not generally travel outside the pleaded cases on each side. The role of pleadings has not been abolished by the CPR. In the very recent case of Boake AllenLtd v Revenue and Customs Commissioners [2006] EWCA Civ 25 Mummery LJ said (para 131):
“While it is good sense not to be pernickety about pleadings, the basic requirement that material facts should be pleaded is there for a good reason - so that the other side can respond to the pleaded case by way of admission or denial of facts, thereby defining the issues for decision for the benefit of the parties and the court. Proper pleading of the material facts is essential for the orderly progress of the case and for its sound determination. The definition of the issues has an impact on such important matters as disclosure of relevant documents and the relevant oral evidence to be adduced at trial. In my view, the fact that the nature of the grievance may be obvious to the respondent or that the respondent can ask for further information to be supplied by the claimant are not normally valid excuses for a claimant’s failure to formulate and serve a properly pleaded case setting out the material facts in support of the cause of action. If the pleading has to be amended, it is reasonable that the party, who has not complied with well known pleading requirements, should suffer the consequences with regard to such matters as limitation.”
[28]Similarly, in Loveridge v. Healey [2004] EWCA Civ. 173 Lord Phillips of Worth Matravers MR said:
“It is on the basis of the pleadings that the parties decide what evidence they will need to place before the court and what preparations are necessary before the trial. Where one party advances a case that is inconsistent with his pleadings, it often happens that the other party takes no point on this. Where the departure from the pleadings causes no prejudice, or where for some other reason it is obvious that the court, if asked, will give permission to amend the pleading, the other party may be sensible to take no pleading point. Where, however, departure from a pleading will cause prejudice, it is in the interests of justice that the other party should be entitled to insist that this is not permitted unless the pleading is appropriately amended. That then introduces, in its proper context, the issue of whether or not the party in question should be permitted to advance a case which has not hitherto been pleaded.”
[29]Lord Phillips expressly rejected the submission that the court should “disregard the pleading rather than … close its eyes to what are admitted to be the true facts”. It is, I think, an instinctive reaction of a judge that a roving enquiry, outside the confines of a defined dispute, is unlikely to have been what Parliament intended under section 37.[30]The point goes a little further than simply being an instinctive reaction. Even in the most informal tribunals, the rules of natural justice must be respected. One of those rules is that a person whose property rights are at stake must be told the basis on which his rights are challenged. It seems to me to be unlikely that Parliament can have contemplated that the Comptroller could reach a determination on the question of ownership of a patent, adverse to both the registered proprietor and the referrer, even on the basis of the evidence adduced before him, without giving advance notice of the possibility and inviting comments or submissions from each. Mr Floyd and Mr Edenborough submitted that this was not possible, because section 101 required the Comptroller, before exercising “any discretion” adversely to a party to proceedings, to give that party an opportunity to be heard. I do not, however, think that section 101 is in point. The determination of a proprietary claim is not a question of discretion. It is what, in a different context, Lord Browne-Wilkinson has called a decision about “hard-nosed property rights”: Foskett v. McKeown [2001] 1 AC 102, 109. The remedy awarded by the Comptroller may well be discretionary, but the initial determination of property rights is not.[31]In the case of a reference under section 37 the referrer must comply with rule 54. This requires him to set out fully the nature of the question, the facts upon which he relies and the order which he is seeking. The requirements of rule 54 are very close to the requirements of a statement of case under the CPR. The purpose of a rule 54 statement is, as it seems to me, twofold. First, it tells the other party or parties to the reference what case he has to meet. Thus, as Mummery LJ and Lord Phillips pointed out, he will decide what evidence to gather and what preparations to make. Second, as Mummery LJ said, definition of issues helps the court or tribunal (in this case the Patent Office). The nature of the method of initiating a reference, which is prescribed by the rules, throws some light on the nature of the reference itself. In addition the express terms of rule 54 limit the first “rounds” of evidence to evidence “in support of [the] case” and confine subsequent evidence to evidence “strictly” in reply. No further evidence may be adduced without the permission of the Comptroller. All these provisions contemplate a degree of formality which, in my judgment, does not point towards a conclusion that the Comptroller is embarking on a roving enquiry.[32]Mr Edenborough submitted that the Patents Office was an informal tribunal, and that its procedures should be flexible, in order to cope with the many cases in which legally unrepresented litigants came before it. I agree with this submission, but, as Mr Edenborough also accepted, any informality and flexibility must abide by the rules themselves. Moreover, as Mr Edenborough also accepted, no amount of flexibility can confer on the Comptroller a jurisdiction that he does not have.[33]In R v. Comptroller-General of Patents Designs and Trademarks ex p Ash & Lacey Building Products Ltd [2002] RPC 46 Laddie J said that under section 72 (dealing with revocation):
“… the power to revoke arises in circumstances where there is a lis between the patentee and the applicant. The Comptroller (or the court) is not prosecutor and judge, she is judge alone.”
[34]Ash & Lacey was a case in which revocation was sought on the ground that the patent was invalid because of anticipation by prior publication. The force of Laddie J’s dictum seems to me to be stronger in a case where the issue is entitlement rather than validity. In a case of validity, there is clearly a public interest (of which the Comptroller is the guardian) in not having apparent monopolies on the register which are invalid. As Jacob LJ observed in Markem Corporation v Zipher Ltd [2005] EWCA Civ 267 (para 88):
“The sooner an obviously invalid monopoly is removed, the better from the public point of view.”
[35]But there is a rather lesser public interest in determining who is legally entitled to an admittedly valid monopoly. If, therefore, there is a dispute (“lis”) between rival contestants to a legal right, one would expect someone fulfilling the role of judge to adjudicate between the rival claimants, and no more.[36]Mr Edenborough submitted that the form of rule 54 could not cut down the width of the statutory question that the Comptroller was required to answer. Mr Alexander, on the other hand, said that section 37 (1) laid down jurisdictional limits, within which the referrer could choose his own question to refer. Provided that the question stated in a rule 54 statement itself fell within the limits in section 37 (1), the question so stated determined the scope of the inquiry to be conducted by the Comptroller.[37]I appreciate, of course, that one should not interpret primary legislation by reference to secondary legislation, and subsequent secondary legislation at that. However, it seems to me that, potentially, Mr Floyd’s and Mr Edenborough’s submission could do away with any need for the Comptroller to observe the rules of natural justice and allow him to decide a formulated dispute between parties in a manner that neither of them contended for. Moreover, there are three possible statutory questions that can be referred to the Comptroller (in paragraphs (a), (b) and (c) respectively of section 37 (1)) and it cannot be the case that by referring to the Comptroller, say, the question posed by paragraph (a), the Comptroller is thereby empowered to determine questions (b) and (c) as well. I accept that the discretion conferred upon the Comptroller in deciding a remedy under section 37 (“make such order as he thinks fit”) is a wide one. The examples given in section 37 (2) are only examples. But the limitation on the Comptroller’s power to devise a suitable remedy is that the remedy can only be devised to give effect to the determination of the question. Logically, therefore, identification of the question to be determined must precede a consideration of the Comptroller’s power to fashion a suitable remedy.[38]It seems to me, therefore, in agreement with Mr Alexander, that the function of the Comptroller (and the court) in entitlement proceedings is to decide a formulated dispute between the parties, raised in a rule 54 statement, provided that the question thus raised is itself within the scope of section 37 (1), rather than the undertaking of a roving inquiry as soon as section 37 (1) is engaged by the making of a reference.

Is section 37 (5) a limitation period?

[39]Section 37 (5), interpreted in accordance with section 130 (7), was intended to give effect to Article 23 of the CPC. Article 23 deals in two different sub-articles, with a claim to sole ownership of a patent, and a claim to joint ownership. It then says that no legal proceedings advancing these claims may be instituted later than two years after publication of the grant of the patent. The reason for the restriction, according to the Report on the Convention is “in the interests of legal certainty”. This is one of the key objectives of a limitation period. The importance of legal certainty is emphasised in the Report’s commentary on the exception to the time limit, referring to the actual knowledge of the proprietor that he was not entitled to the patent. It is also clear from the commentary, that both section 37 (5) and 72 (2) give effect to the same article and that, therefore, both are underpinned by the requirement of legal certainty.[40]In my judgment section 37 (5) is properly to be regarded as a limitation period.[41]That, however, leads on to the next question: what does section 37 (5) bar? Mr Floyd QC and Mr Edenborough submitted that section 37 (5) did not prevent the Comptroller from determining the question of entitlement to the patent, even if the claim was a claim to sole entitlement. Nor did it prevent him from making an order giving effect to the determination, as long as the order was not the outright transfer of the patent. Mr Edenborough said that section 37 (5) only barred a particular remedy. Mr Floyd submitted that it was open to a claimant to claim sole entitlement to a patent and then to ask the Comptroller to order the grant of a royalty-free exclusive licence, which has almost all the economic effects of an outright transfer.[42]It is plain that section 37 (5) was intended to give effect to Article 23 of the CPC. But so, also, was section 72 (2). And section 72 (2) bars the making of an application outside the two year limit, not merely the making of an order. In addition, section 74 (4) precludes the raising (outside the two year time limit) of invalidity on the ground that the patent was granted to a person not entitled to it in infringement proceedings (among others). Article 23 itself refers to the institution of legal proceedings. In Markem Jacob LJ said (para 95) that in interpreting the Patents Act it is necessary to identify those parts of it that are derived from international conventions. The parts so derived are likely to form a coherent whole. It would not, in my judgment, be rational in this context to attribute different meanings to section 37 (5) and section 72 (2). The slight awkwardness of the language of section 37 (5) which enabled Mr Floyd and Mr Edenborough to advance a literal interpretation of its words is probably attributable to the need to “stitch in” the effect of Article 23 to what Jacob LJ called a “free-standing” and “home-grown” provision. Since the avowed intention of section 37 (5) was to give effect to article 23 (see section 130 (7)) I consider that the limited bar for which Mr Floyd and Mr Edenborough contended would not give effect to the avowed purpose of section 37 (5). In my judgment section 37 (5) bars the making of a claim outside the two year time limit; not merely the grant of a particular remedy.

Do the CPR apply to proceedings in the Patent Office?

[43]Rorer’s case was argued before the Hearing Officer on the footing that the criteria in CPR 17.4 should be applied to the hearing before him. In my judgment it is clear that the CPR do not apply to proceedings in the Patent Office. There is no power under the Civil Procedure Act 1997 to make rules for the Patent Office. Moreover, proceedings in the Patent Office are governed by their own rules; made under a different rule making power, and by a different rule making authority. Sometimes a separate procedural code will incorporate the CPR (see, for example, Insolvency Rules 1986 rule 17.51). But that is not the position under the Patents Rules.[44]There can, however, be no objection to the Comptroller indicating that the powers conferred upon him (or his hearing officers) will, in general, be exercised in the same way as a judge would exercise similar powers under the CPR. That said, the powers of the Comptroller are those conferred by the Patents Rules; and it would not be correct for the Comptroller to fetter a discretion conferred by the rules. Any expression of general policy must be capable of being departed from in an individual case, provided that the departure achieves justice and is within the powers conferred by the Patents Rules. This is precisely what the Comptroller says in the Patent Hearings Manual, and he is undoubtedly right to say that.

Can the Comptroller permit amendments to the rule 54 statement?

[45]Mr Edenborough submitted that the Comptroller, as a tribunal, had power to regulate the procedure to be followed before him. That inherent power included a power to allow amendments to the rule 54 statement to be made. I agree that any tribunal has an inherent power (subject to constraints) to regulate the procedure to be followed before it (Langley v. North West Water Authority [1981] 3 All ER 610; Pharmedica GMBH’s Trade Mark Application [2000] RPC 536). But if there is an express power I cannot see the need to search for an implied one.[46]The Comptroller’s power to allow amendments is a power conferred upon him by rule 100 of the Patents Rules, which, on the face of it, gives him an unfettered discretion to allow or disallow amendments to documents filed in the Patent Office. A rule 54 statement is a document filed in the Patent Office. Why does rule 100 not govern its amendment? Mr Edenborough, however, persisted in his submission that the power to permit amendments was an inherent power. He said that the Patent Office preferred to base its decision on the inherent power, because it was more flexible. I reject this submission for two reasons. First, because the express power given by rule 100 is itself a flexible power. Second, because if there were an express power subject to constraints, it must be taken to have been Parliament’s intention that the power should be exercised subject to those constraints: not that the constraints could be by-passed by the exercise of an inherent power free from the constraints. In my judgment the relevant power that the Hearing Officer had was that contained in rule 100. Unfortunately, rule 100 was not referred to in the hearing before him.[47]Mr Alexander submitted that Article 23 of the CPC did not contemplate amendment of a claim at all. From this it followed that a claim to entitlement could not be amended. I do not agree. Article 23, as the heading to this section of the CPC makes clear, is dealing with substantive law. In general, where part of community law is applied directly in a Member State, the manner in which that law is applied, and in particular the procedure for its application, is that of the Member State concerned. So I do not consider that the mere fact that Article 23 does not expressly refer to the possibility of amendment necessarily means that no amendment whatsoever is allowed. Moreover, if a claim were made within the two year time limit, and an amendment were sought to be made within the same two year period it would be pointless, and productive of greater expense, to require a separate claim to be begun. That is not to say that an amendment should be permitted outside the two year limit; but that is a different question.

What is the effect of an amendment?

[48]Before considering the criteria that should be applied to the decision whether to permit an amendment, it is necessary to address the effect of an amendment. If the effect of an amendment would be to defeat a defence based on limitation, that may be a powerful factor militating against amendment. If, on the other hand, it would not have that effect, then the objection based on limitation might have little effect. The case before the Hearing Officer appears to have been conducted on the basis that, if allowed, the amendments would relate back to the date of the original reference. That assumption was questioned during the course of the hearing before me.[49]In Ketteman v Hansel Properties Ltd [1987] AC 189 the House of Lords considered the effect of an amendment (absent any special statutory provision). Lord Keith of Kinkel referred to the long-standing:
“rule of practice that amendment should not be allowed for the joinder of an additional defendant in a situation where a relevant period of limitation has already expired in relation to the cause of action against him.”
[50]He pointed out that the reason for the rule was debatable. One theory was that because the amendment “related back” to the date when the original action was started, it would be unfair to deprive a defendant of a potential defence of limitation. The other theory was that since the amendment took effect only from the date it was made, there would be no useful purpose in allowing the amendment, precisely because there would be an unanswerable defence of limitation. The House of Lords rejected the “relation back” theory and said that the “no useful purpose” theory was the correct one. In Banks v. CBS Songs Ltd [1992] FSR 278 Scott LJ (with whom Nourse LJ and Sir David Croom-Johnson agreed) said that Ketteman had sounded “the death knell” for the relation back theory, not only in relation to adding new parties, but also to adding new causes of action.[51]That also explains why the approach of the court is that if the defendant has an arguable defence, based on limitation, the court will not allow an amendment to be made which would have the effect of defeating that defence. Instead it will require the claimant to bring fresh proceedings, in which limitation issues can be tried: Liff v. Peasley [1980] 1 WLR 781, 791 (per Stephenson LJ) and 799 (per Brandon LJ); Welsh Development Agency v. Redpath Dorman Long Ltd [1994] 1 WLR 1409.[52]The principles that I draw from these cases are that: i) In the absence of statutory provision to the contrary, an amendment which adds a new party or a new cause of action takes effect from the date on which it is made, and not from any earlier date; ii) It is wrong in principle to deprive a defendant of a limitation defence by permitting an amendment to be made, except in circumstances where an Act or rule permits that amendment to be made.[53]Section 35 (1) of the Limitation Act 1980 is one statutory provision to the contrary. So, for this purpose, is CPR 17.4. Although CPR 17.4 (1) (b) (iii) deals with limitation periods other than those laid down by the Limitation Act 1980 itself (and was validly made within the rule making power), it does not in my judgment create a general doctrine of relation back which applies across the board in English procedural law. In Banks, for example, a claim to damages for conversion by breach of copyright was precluded by the transitional provisions in the Copyright Designs and Patents Act 1988. That was a question of the interpretation of that Act. It was not suggested that the rules then in force could override the meaning of the Act itself. In Parsons v.

(b) (iii) said that:

“The object of the new paragraph (1)(c) was to ensure that the court cannot allow a change of parties after the end of a limitation period if the statute which prescribes the limitation period does not allow that to be done.”
[54]Whether a statute allows an addition of a new party or a new claim after the expiry of a limitation period must, in my judgment, be a question of interpretation of the statute in question. I have already concluded that section 37 (5) of the Patents Act is a limitation period. It is in a section of the CPC dealing with substantive law. I would therefore be inclined to conclude that freedom from suit at the end of the two year period is a substantive legal right, rather than a mere procedural advantage. Moreover, the CPC is intended to be applied across the EU, and I do not know whether any other Member State applies the doctrine of “relation back” to limitation periods, or whether courts in Member States have discretion to override limitation periods (as our courts do, for instance, in some cases of personal injury).[55]In domestic law limitation periods have a number of different policy justifications. The principal strands are: i) Evidentiary reasons. Evidence may depend on the recollection of witnesses, which deteriorates over time. It may depend on the preservation of written records which may be lost or destroyed. ii) The interests of defendants. Defendants may have changed their position or conducted their businesses in the belief that a claim would not be made. It is for this reason that limitation statutes have been described as “acts of peace” or “statutes of repose”. People should be free to get on with their lives or businesses without the threat of stale claims being made. iii) Encouragement of claimants. A limitation period also encourages claimants to bring their claims promptly and not, in the old phrase, “to sleep on their rights”. iv) The public interest. The public interest has always been concerned that litigation should be brought within a reasonable time. This enables cases to be dealt with properly and justly. Moreover the public interest requires the principle of legal certainty.[56]The particular balance that Parliament has struck in the case of domestic litigation is found in section 35 (5) of the Limitation Act. The policy underpinning that section was explained by Dyson LJ in Parsons v. George as follows:
“8 The question of whether to grant permission to add a new cause of action or a new defendant after the expiry of a relevant period of limitation has vexed the courts for many years. Various attempts have been made to balance the competing interests of claimants and defendants. On the one hand, it may be unjust to a defendant to add a person as a party to proceedings if this would deny him an accrued limitation defence. Thus it was that there was a long established practice at common law that a claimant would not be permitted to join a person as defendant to an existing action at a time when the defendant could have relied on a statute of limitation as barring the claimant from bringing a fresh claim against him: see, for example, Liff v Peasley [1980] 1 WLR 781, per Stephenson LJ, at p 791C, and per Brandon LJ, at p 799B. The reason for this rule of practice was explained by the House of Lords in Ketteman v Hansel Properties Ltd [1987] AC 189 as being that there would be no "useful purpose" in allowing the amendment, since the new defendant was not deemed to have become a party before the actual date of the joinder, and would therefore have an unanswerable defence to the claim. 9 On the other hand, there are circumstances in which it would be manifestly unjust to a claimant to refuse an amendment to add or substitute a defendant even after the expiry of the relevant limitation period. A common example of such a case is where the claimant has made a genuine mistake and named the wrong defendant, and where the correct defendants have not been misled, and they have suffered no prejudice in relation to the proceedings (except for the loss of their limitation defence).”
[57]Statements to similar effect may be found in Goode v Martin [2002] 1 WLR 1828. However, that is not the only possible policy choice. Dyson LJ himself traces shifts in policy through the various versions of the rules. One may also note changes in policy towards shortening of limitation periods in some cases (for example the reduction from 20 years to 12 years for the period needed for adverse possession; or the reduction in the limitation period for defamation actions from six years to one); extending limitation periods in other cases (for example latent damage); and the introduction of discretionary powers to extend limitation periods (for example in actions for personal injuries). What is now section 35 of the Limitation Act 1980 was not introduced until the Limitation Amendment Act 1980. All these are policy choices. The CPC refers only to “legal certainty” as the relevant policy underlying Article 23. The doctrine of “relation back” detracts from legal certainty, as it exposes a defendant to potential liability at a time when he might legitimately have expected to be free from suit. According to Parsons v. George, in general an Act of Parliament will be taken to allow an amendment if it is not expressly prohibited; and if amendments of the kind in question are normal incidents of the litigation contemplated by the Act. Whether either or both these conditions are fulfilled must, in my judgment, be a question of interpretation of the Act in question. An important part of the process of interpretation is to decide whether Parliament can have intended an amendment made out of time to relate back. It may be that, as a matter of construction of the Act in question, Parliament may be taken to have intended that some kinds of amendment would be allowed, but that other kinds would not.[58]Mr Edenborough submitted that an amendment was permitted under section 37 even if made outside the two year time limit. He said that it would be illogical if the Comptroller could make a finding about the true ownership of a patent without any amendment raising a claim to ownership by the person whom he found to be the true owner, but could not allow an amendment raising such a claim. I agree that such a conclusion would be illogical. But in my judgment the answer to the conundrum is, as I have explained, that the Comptroller does not have the roving jurisdiction that Mr Edenborough asserted. Once one has reached that conclusion, the illogicality disappears. Mr Edenborough also submitted that once a reference had been made within the two year time limit, any question of limitation became irrelevant. Thus it was open to the Comptroller to permit amendments to an existing reference, even if the amendment introduced new causes of action or new claims. In support of this submission he relied on Pharmedica.[59]I do not consider that Pharmedica gives him the support he seeks. The question that arose in that case was whether an assignee of a trademark should be substituted in existing opposition proceedings for the assignor. It is not wholly clear from the report whether the assignment took place before or after the opposition proceedings were begun, but the tenor of the reasoning of Pumfrey J suggests that it took place afterwards. The particular passage on which Mr Edenborough relies is the following:
“Turning to the present case, I must first deal with the question whether the three-month time limit on oppositions was, as the hearing officer decided in this case, … being circumvented. In my judgment, it plainly is not. Once the proceedings are on foot the time limit has ceased to be relevant to those proceedings at all.”
[60]However, one must consider the reasons that led the judge to that conclusion. He examined what he called “the analogous situation” under rules of court where a cause of action had devolved upon a claimant after the expiry of a limitation period. He quoted with approval a report of a judgment of Mance J in Industrie Chimiche Italia Centrale v. Alexander G. Tsavliris & Sons Maritime Co. [1995] T.L.R. 465 in which that judge said that in all situations of:
“everyday occurrences as death of one or other party, bankruptcy leading to assignment to a trustee in bankruptcy, assignment, transmission or devolution of interest ... of which death was only the most striking, it seemed self-evident both that any existing proceedings, properly constituted within the limitation period, should be allowed to continue for or against the party to whom the relevant right or obligation had been transferred in law; and that that should be permitted whether the transfer occurred before or after the expiry of the limitation period. The underlying rationale of limitation periods, to protect against stale claims which should have been brought earlier, had no application to this type of case.” (Emphasis added)
[61]Pumfrey J concluded:
“The effect of a substitution is that the party substituted carries on the original proceedings. He does not, by reason of substitution, become entitled to plead, if the pleadings are over, or file evidence, if the evidence is in, otherwise than by making application in the same manner as the original opponent would be obliged to apply if it wished to be allowed to revisit the pleadings or the evidence. No question of circumventing any time limit arises. So I do not think that to permit substitution offends against the requirements of the Act requiring an opposition to be started within three months of publication.”
[62]There is, in my judgment, a fundamental difference between carrying on existing proceedings as a result of a devolution of title once the proceedings have started and an enlargement of the scope of a dispute as a result of an amendment. Pharmedica is directed to the former and not the latter. I do not consider that it supports Mr Edenborough’s submission.[63]The signatories to the CPC have made a policy choice. They have opted for “legal certainty”. That militates against an amendment allowing a new claim to be made after the expiry of the limitation period which relates back to the date when the claim was originally made, even if it does arise out of the same facts. Parliament has given effect to the CPC in the Act. In my judgment the limitation periods in the Patents Act 1977 which are designed to give effect (and are declared by the Act itself to give effect) to article 23 do not permit new claims to be raised out of time. They are not, therefore, limitation periods to which CPR 17.4 (1) (b) (iii) applies.[64]There is nothing in the CPC, the Patents Act or the Patents Rules which applies the theory of relation back to all amendments made under the Act. Section 18 (3) of the Patents Act 1977 allows an applicant, following a report by an examiner, to amend his application. Section 27 allows an amendment to a specification to be made on application to the Comptroller. In such a case section 27 (3) deems the amendment to have had effect from the date of grant of the patent. Section 75 allows an amendment to be made to a specification in any proceedings in which the validity of the patent is put in issue. In such a case section 75 (3) deems the amendment to have had effect from the grant of the patent. These, then, are specific provisions that provide for a kind of “relation back” in limited and particular cases. However, it is an objection to an amendment under section 18, section 27 or section 75 that it includes additional matter; that is matter not disclosed by the original specification: section 76. In other words, although an amendment relates back, new matter (analogous to new causes of action) may not relate back.[65]The context of the Patents Rules is one in which commercial and property interests are at stake, and certainty in commercial life is important. The doctrine of “relation back” is not a common law doctrine, and in my judgment there is nothing in the relevant legislative material which would warrant its wholesale importation into the Patents Rules. The limited cases in which a kind of relation back (not involving additional matter) is expressly permitted under the Act would suggest the contrary. So, too, does the international character of the provisions giving effect to Article 23 of the CPC and its emphasis on legal certainty.[66]I conclude therefore that if an amendment adding a new party or a new cause of action is made to a rule 54 statement, the amendment will not relate back to the date of the original reference, but (where the amendment is made in order to raise a claim of the kind contemplated by Article 23 of the CPC) will take effect from the time it was made. It may well be that an amendment which reflects a devolution of title that takes place during the course of a reference would, as a matter of construction of the Act, be “allowed” since that may well be a normal incident of such a reference and would not introduce any new cause of action or claim. But that is not this case.

Should the Hearing Officer have applied the criteria in CPR 17.4?

[67]In opening the appeal, Mr Alexander QC submitted that the court and the Comptroller had concurrent jurisdiction to determine questions under section 37. A reference could be made to the Comptroller under section 37 (1), or a claimant could apply to the court for declaratory relief under the court’s inherent jurisdiction to make declarations of right, preserved by sections 37 (8) and (9). Alternatively, the Comptroller could refer a question for the determination of the court under section 37 (8). It would be absurd, he submitted, if the procedure for a determination of the identical question differed according to the forum in which the question was determined. Moreover, he argued, the question of amendment was not simply procedural. It was a question of substantive right. The substantive rights of a proprietor should not differ according to the forum in which his proprietorship was challenged. To hold otherwise might lead to undesirable forum-shopping. Accordingly, he submitted in opening the appeal that even if the CPR themselves do not directly apply, the Hearing Officer should have applied the criteria laid down in CPR 17.4.[68]In support of his submission, Mr Alexander relied on St Trudo Trade Mark [1995] RPC 370. That was a case in which Ferris J considered the admissibility of hearsay evidence in proceedings in the Trade Marks Registry. The admissibility of hearsay evidence was governed by the Civil Evidence Act 1968 which applied not only to courts but also to tribunals in which the strict rules of evidence apply. So the question for Ferris J was: whether the strict rules of evidence applied to proceedings in the Registry. He decided that they did. Ferris J reviewed the nature of proceedings in the Registry; and pointed out that the subject-matter was technical; that the Registrar and his hearing officers were specialists in the field; that there were detailed formal rules for the filing of notices of application and opposition; and that the rules themselves provided for evidence to be given by way of statutory declaration. One important strand in his reasoning was that an appeal lay from the Registrar to the court; and the rules expressly provided that a statutory declaration received by the Registrar should count as an affidavit on appeal to the court. Ferris J was impressed with the argument that the material available to the court should not differ from that available to the Registrar; thus avoiding the consequence that there might be different outcomes according to the forum in which a dispute was heard.[69]However, there are situations in which procedure in the Patents Office may differ from that in the court. One example which features in the cases shown to me was the withdrawal of revocation proceedings. In Ash & Lacey Laddie J held that the Comptroller, as guardian of the public interest, had the power to continue to examine the validity of a patent, even after revocation proceedings had been withdrawn. This contrasted with the power of the court which he assumed, under CPR 38, had no power to prevent the discontinuance of a claim. If, therefore, the revocation proceedings had been begun in court (as they could have been) the court would not have been able to continue to consider the validity of the patent after the claim had been discontinued. Laddie J said that although there was no express power given to the Comptroller to refuse to accept withdrawal of an application, there was no express power to withdraw either. Consequently, the decision was a matter of procedure in the Patent Office, which the Comptroller was entitled to regulate, provided that the decision was made on rational, non-capricious grounds. Laddie J noted that there was “an unsatisfactory difference” between the powers of the Comptroller and those of the Patents Court, but was not convinced that the difference was as unpalatable as counsel suggested.[70]In addition, I am not convinced that there is quite the potential mis-match that Mr Alexander suggested if the Comptroller has powers which differ from those of the court. Section 99 of the Patents Act says that in exercising its original or appellate jurisdiction under the Act the court has all the powers of the Comptroller. So if the Comptroller were to transfer a question to the court under section 37 (8) it may well be that the court’s powers would be different from those conferred by the CPR alone. This may be an answer to the assumption that Laddie J left undecided. Nevertheless there may still be a possible mis-match if an application were made to the court under its inherent jurisdiction (i.e. it was not exercising the powers under the Act); but it is of rather lesser proportions than that which Mr Alexander suggested.[71]I have already noted that a reference made under section 37 may be transferred by the Comptroller to the court; and that the court retains its original declaratory jurisdiction. Questions of entitlement may also arise in infringement proceedings. It might be said that in such cases the court would apply the criteria in CPR 17.4 with the consequential relation back of amendments, which CPR 17.4 presupposes. However, as Dyson LJ explained in Parsons v. George, the court can only allow an amendment after the expiry of a limitation period contained in an Act of Parliament if such an amendment is allowed by the Act in question. I have concluded that section 37 (5) of the Patents Act 1977 is not one such provision. So in that situation there would be no mis-match on that account either.[72]By the time of his reply Mr Alexander had retreated (or perhaps advanced) from his position that the Hearing Officer should have applied the criteria in CPR 17.4. His position at the end of the appeal was that the application of the criteria in CPR 17.4 was the best that Yeda could ask for; and that the Hearing Officer was wrong to have adopted a more liberal test. Bearing in mind the conclusions I have reached thus far, in my judgment he is right.[73]It is, I think, permissible to distinguish between a rule and a principle. If it is possible to identify a principle underlying the court’s approach to the grant of permission to amend in cases where a limitation period has expired, then it may well be that the Comptroller ought to apply the underlying principle, even if the rule itself does not apply. In cases not covered by CPR 17.4 the underlying principles are, in my judgment: i) That permission to amend to introduce new parties or a new claim should not be granted where there is a clear limitation defence; and ii) Where the limitation defence is arguable, it should be tested in fresh proceedings.[74]That is the long-standing rule of practice to which Lord Keith referred in Ketteman and to which the Court of Appeal referred in Redpath. The well-known observations of Peter Gibson LJ in Cobbold v. London Borough of Greenwich on which the Hearing Officer relied (and which are quoted both in the Patents Hearings Manual and in the notes at paragraph 17.3.5 of the White Book) are directed to a different situation. Permission to amend should normally be granted where the party against whom the amendment is made can be adequately compensated in costs. Peter Gibson LJ was not dealing with a case in which a potential limitation defence arose. In my judgment, his observations do not apply to such a case, which has always been (and still is) treated as special.[75]Be that as it may, in my judgment the answer to the question whether the hearing officer should have applied the criteria laid down in CPR 17.4 is “no”. CPR 17.4 is a particular rule of court. It applies to proceedings in courts to which the CPR themselves apply. It cannot, in my judgment, apply to tribunals to which the CPR do not themselves apply. In paragraph 13 of his decision the hearing officer said that he did not consider that he was bound to apply the CPR in all cases where there might be a lacuna in the procedures prescribed by the Patents Act and the Patents Rules, still less that he should regard the CPR as some sort of gloss which automatically applies as a further layer of rules governing those procedures. In his view the most that can be said is that the CPR will be indicative in some cases, but by no means all, of the approach to be adopted by the Comptroller. I respectfully agree.[76]But in any event, the limitation period in section 37 (5) is not one which permits a new claim to be made outside the limitation period. So CPR 17.4 would not have applied anyway.

What is a new claim?

[77]Mr Floyd relied on the analysis of a new claim or new cause of action by Auld LJ in Lloyds Bank plc v. Rogers [1999] 3 EGLR 83. That was a curious case, because the appeal was heard by a two-judge court, and Evans LJ did not agree with Auld LJ on this point (although he concurred in the result). However, Auld LJ’s analysis was subsequently approved by the Court of Appeal in Aldi Stores Ltd v. Holmes Buildings plc [2003] EWCA Civ. 1882 (Auld, Hale and Dyson LJJ), so must be taken to be authoritative. Auld LJ said that what makes a claim a “new claim” as defined in section 35 (2) of the Limitation Act 1980 is not the newness of the case according to the type or quantum of the remedy claimed, but the newness of the cause of action that it involves. A cause of action is a set of facts that enable one person to obtain a remedy from another; as opposed to a form of action used as a convenient and succinct description of a particular category of factual situation. Thus one factual situation may disclose more than one cause of action. This distinction, he said, was in the mind of the draftsman of both section 35 (1) and the rules of court that gave effect to it. The remedy claimed may or may not be the same: it depends on what facts are relied on in support of it. If the facts relied on are new, then the claim will be new. If the facts relied on are the same facts, then a change of remedy will not be a new claim.[78]It may be helpful to illustrate this by examples. Suppose that X is registered as proprietor of a patent. Y claims that he is entitled to be registered as sole proprietor. He may say: i) I am the true deviser of the invention, so I am entitled to be registered; ii) Although X was the true deviser of the invention, he was my employee at the material time, and his interest in the invention belongs to me as a result of that relationship; iii) Although X was the true deviser of the invention, he has assigned his rights to me by deed, so his interest belongs to me as a result of the assignment; iv) Although X was the true deviser of the invention, he has used my confidential information, so in equity his invention belongs to me.[79]No doubt many other variants are possible. Although each leads to the same legal conclusion, each is based on a different set of relevant facts. So each is a different cause of action.[80]In addition, I have already concluded that Article 23 of the CPC creates substantive legal rights. It deals with claims to sole ownership of a patent and claims to joint ownership of a patent in two different articles. The limitation period applies to both types of claim. However, the consequences of the two types of claim are different, particularly for third parties such as licensees; as is made clear both by Article 24 and by section 38. In my judgment a claim to sole ownership and a claim to joint ownership are different claims.[81]The relevant claims are claims to a proprietary interest in a patent. Such claims therefore depend on proof of title, which will depend on some rule of law: Markem at paras 78 and 79. The claim may be based on express or implied agreement between the inventors themselves, or it may depend on some rule of law which attributes the property in the invention to some third party (e.g. an employer). The first kind of claim may be loosely called a claim based on what went on in the lab or workshop; the second on what went on in the human resources department. Each kind of claim can raise quite different factual and legal issues. I have given some examples above. In my judgment each kind of claim should be treated as a separate claim for the purposes of Article 23 and section 37 (5).

The question and claims in this case

[82]The original reference was a reference of two questions. They were: i) Whether Yeda should be the joint proprietor of the patent in suit; ii) Whether three scientists (called “the Weizmann Inventors”, because they were employed by the Weizmann Institute in Israel) should be named as co-inventors of the patent.[83]The orders sought were: i) That the patent be transferred into the co-ownership of Rorer and Yeda and ii) That the patent be amended to name the Weizmann Inventors as co-inventors.[84]The claim stated that the Weizmann inventors were employed by the Weizmann Institute and that both they and the Institute had assigned their rights in the invention to Yeda. Apart from that, the claim was based entirely on what happened in the laboratory.[85]The questions referred, in the amended form added the questions: i) whether Yeda should be the sole proprietor of the patent; ii) whether the patent should have been granted to Rorer at all; iii) whether all or any rights in the patent should be transferred or granted to Yeda; iv) Whether the Weizmann Inventors should be named as sole inventors of the patent.[86]The amended claims were put on two alternative bases. One basis expanded the account of what happened in the laboratory. In particular it alleged: i) That Professor Schlessinger (one of the inventors named in the patent) had provided the research team with monoclonal antibodies which were the property of the Institute. The allegations explained why a claim to property in those antibodies was maintained; ii) That the discovery that one of the antibodies in combination with an anti-neoplastic agent had a synergistic effect on inhibition of the growth of cancer cells was reported to Professor Schlessinger in circumstances importing an obligation of confidence; iii) That the application for the patent was made in breach of that obligation of confidence; and in breach of certain provisions of Israeli law; iv) That in any event the contribution of the named inventors was insufficient to amount to a contribution to the devising of the invention.[87]In addition to this claim, the amended rule 54 statement alleged that Professor Schlessinger was at all material times an employee of the Institute; and that under Israeli law any invention made by him belonged to the Institute (and thence to Yeda by virtue of the assignment mentioned above).

The Hearing Officer’s reasons

[88]The Hearing Officer recorded Yeda’s submission that section 37 (5) did not establish a limitation period: it “merely provided a time limit”. I am bound to say that I do not understand the distinction. Be that as it may, the Hearing Officer proceeded on the basis that section 37 (5) did amount to a limitation period. He was, in my judgment, right to do so.[89]The Hearing Officer next recorded that it was common ground that the judgment of Park J in Hoechst UK Ltd v Inland Revenue [2004] STC 1486 provided a convenient starting point. That judgment was the subject of some criticism by the Court of Appeal in the Boake Allen case; but I do not think that matters for present purposes. Having considered the arguments, the Hearing Officer decided that, if he were deciding the question according to the criteria in CPR 17.4 he would have held that a claim to sole ownership was “something quite different from a claim to joint ownership”. He also pointed out that the amended claim did not “rest on an essentially unchanged set of facts”. He considered that the new facts might require “major new investigation”. With all that, I respectfully agree. Moreover, since the question whether a claim is a new claim (in the sense I have discussed) is one of broad judgment, even if I did not agree with the Hearing Officer I could only interfere with his decision if he misdirected himself, or came to a conclusion outside the range of conclusions within which reasonable people could disagree.[90]The Hearing Officer then considered whether he should apply the criteria in CPR 17.4 and concluded that he was not bound by the CPR. With that, too, I respectfully agree.[91]But having correctly decided that the CPR did not apply, the Hearing Officer did not go on to consider the question: what would be the effect of the amendments, if allowed? That was not his fault. The point was simply not addressed. The assumption was that if the amendments were allowed, the questions raised by amendment would be considered by the Comptroller in due course. In my judgment, for the reasons I have given, the assumption was wrong. The amendments will not relate back to the date of the original reference. Rorer’s limitation defence to new claims remains available.[92]The amended claims are new claims both for the reasons given by the Hearing Officer and also because in my judgment that is implicit in Article 23 of the CPC. The claims based on breach of confidence and employment rights are also new claims in the sense of raising wholly new causes of action. If, as I consider, Rorer’s defence of limitation remains available, there is no useful purpose in allowing the amendments.[93]Even if that defence is only arguable, the long-standing rule of practice is that the new claim should be advanced in a new action, where the defence can be tested. If (as the Hearing Officer rightly concluded) CPR 17.4 did not apply, then the long standing rule of practice was the relevant default rule. The observations of Peter Gibson LJ in Cobbold were not in point. The amendments ought not, in my judgment, to have been permitted.

Result

[94]For those reasons I consider that the Hearing Officer’s decision was “wrong” within the meaning of CPR 52.11 (3). I will allow the appeal.

Cited in 1 later judgment