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Building and Construction
Copyright in the Building Industry
What exactly is copyright and who is entitled to it? It is a word we hear bandied around often enough. But what does it mean? Copyright is basically a property right. It consists of the exclusive right to print a published literary work ie the right of preventing all others from so doing. However the principle also extends to:
- original literary, dramatic, musical and artistic works
- recordings
- films
- broadcasts
- cable programmes
- typographical arrangement of published editions.
Copyright is transmissible by the following means:
- assignment
- testamentary disposition or
- operation of law
as personal or moveable property. No assignment of copyright is valid unless in writing signed by or on behalf of the assignor. Licences may also be granted in respect of copyright by the owner or under a licensing scheme.
Disputes regarding copyright commonly occur in the following industries:
- building
- computer (eg. software and web page design)
- fashion
- literary; and
- music.
A recent decision of the High Court Concrete Pty Limited v Parramatta Design & Developments Pty Ltd [2006] HCA 55 (6 December 2006)http://www.austlii.edu.au/au/cases/cth/high_ct/2006/55.html held that in the absence of any agreements stating otherwise, a purchaser of a development site will have an implied licence to use architectural development plans for construction of the purchased land where those plans have already been prepared for that purpose and Council has given development approval.
Background
Parramatta Design and Development Pty Ltd (PDD) were architects business and they entered into a joint venture with the then owners of the site. PDD was to prepare the plans for construction and approval of a residential development. PDD had agreed to prepare the plans free of charge as indirectly it had an interest in seeing the joint venture succeed.
The director and shareholder of one of the companies in the joint venture was also sole director and shareholder of PDD. The local council consent to the development in accordance with the drawings. A dispute arose between the joint venturers when the site was sold and the purchaser was put on notice that PDD sought to deny the purchaser's use of the plans. Accordingly the issue for the Court to decide was whether the purchaser of site had an implied licence to use the drawings.
Lower courts
In first instance the court held that the purchaser had acquired an implied licence to use the plans and drawings for construction of a residential development on the site.. This was the purpose for which the plans had originated and as such the benefit of the plans was said to ‘run with the land’.
On appeal to the Full Federal Court, the trial judge’s decision was reversed. The Court submitted that the implied licence was not assignable to the purchaser. The implied licence only arose between the parties of the joint venture having regard to the fact that the plans were prepared for no fee so that the development would proceed.
Current decision
The High Court unanimously decided to reverse the decision of the Full Federal Court relying on established principles of implied licences and found that the purchaser was entitled to the benefit of the plans prepared by PPD notwisthanding that PPD had prepared them free of charge. Accordingly a person who commissions plans has an implied licence to use those plans for the purpose of which they were created.
As such, once the DA was approved the implied licence became irrevocable as one of the purposes for which they had been prepared had been satisfied. The fact that PPD had prepared the plans free of charge was irrelevant.
Effect
The effect of the decision may be limited to its facts and it may be that the High Court's opinion will only be applied in the future to similar cases involving architectural plans, development consents and/or joint ventures. In any event, the Court has decided that a person engaged to create material protected by copyright may impliedly be creating a licence for successors in title to the original documents and that, that licence may be irrevocable. Until another decision on this point comes before the High Court it will be difficult to ascertain if this case will be interpreted narrowly or broadly and just how far-reaching its effects will be.