In the High Court case of Concrete Pty Limited v Parramatta Design & Developments Pty Ltd [2006] HCA 55, Concrete Pty Limited (“Concrete”) and Parramatta Design & Developments Pty Ltd (“PDD”) had entered into a joint venture agreement with respect to the development of land owned by PDD. Regrettably, the joint venture relationship broke down which resulted in Concrete acquiring the land from PDD. Upon the acquisition of the land, Concrete proceeded to construct on the land based on architectural drawings created by PDD. The plans had also been used to obtain the Development Consent.
Nevertheless, when Concrete began to commence construction, PDD objected to Concrete usingthe architectural drawings as it claimed that it owned the intellectual property rights in the architectural drawings. Accordingly, Concrete issued legal proceedings in the Federal Court of Australia seeking a declaration from the Court that there had been an implied grant of a licence for Concrete to use the architectural drawings.
The High Court held that the drawings were made available for the purposes of obtaining Development Consent and therefore, there was an implied licence to use the drawings by Concrete for the construction of the project. It was further held that in absence of a written license agreement, PDD had received a commercial benefit for producing the drawings and subsequently selling the land. Accordingly, PDD could not revoke the implied licence to use the architectural drawings.
For some time after the abovementioned case, it was presumed by developers that land purchased with Development Consent could expect to have an implied licence to use the architectural drawings which formed part of the consent, in absence of a license agreement which said otherwise. However, in the recent Federal Court of Australia case of Tamawood Limited v Habitare Developments Pty Limited [2013] FCA 410, the Federal Court of Australia distinguished between situations where an architect has not received any benefit, from those where they have received a benefit.
In the Tamawood case, Tamawood Ltd (“Tamawood”) sought relief against a developer, a builder and an architectural firm for allegedly using its architectural drawings and plans (the “Plans”). During the initial stages, it was agreed that Tamawood would prepare the Plans at no cost, on the basis that it would build the houses once the Development Approval had been obtained. However, the relationship between the parties broke down and Tamawood was not retained to build the homes.
The Federal Court of Australia held that the rights to use the Plans were terminated when the conditions attached to the copyright material was not fulfilled. That is, there was an implied licence to use the Plans if Tamawood was retained to build the homes, however, since Tamawood was not engaged to build the homes, the implied licence was terminated. Furthermore, since the licence to use the Plans had been terminated, the Development Consent was defective. Accordingly, a new application was required to be made with non-infringing architectural drawings and plans.
Tips
- If you regularly sell model homes, make sure your company logo, name and a © is clearly placed on your designs.
- If you are planning to build based on someone else’s drawings and plans, make sure the owner of the land owns the copyright in the material before you build, otherwise, you may be liable
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This article is not legal advice and should not be relied upon as legal advice. All articles found on this website are intended to provide informative information, nevertheless, in many instances legislation and case law has been simplified and/or paraphrased. If you would like personal legal advice based on your current circumstances, you should contact MurdockCheng Legal Practice for a free consultation.