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  4. Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton - [2022] QDC 116

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Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton[2022] QDC 116

Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton[2022] QDC 116

DISTRICT COURT OF QUEENSLAND

CITATION:

Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton [2022] QDC 116

PARTIES:

LOOK DESIGN AND DEVELOPMENT PTY LTD

(ACN 130 652 701)

(plaintiff)

v

EDGE DEVELOPMENTS (QLD) PTY LTD

(ACN 163 938 207)

(first defendant)

and

FIONA FLATON and PHILIP FLATON

(second defendants)

FILE NO:

D80 of 2017

DIVISION:

Civil

PROCEEDING:

Claim

ORIGINATING COURT:

Maroochydore

DELIVERED ON:

20 May 2022

DELIVERED AT:

Maroochydore

HEARING DATE:

25 and 26 August 2020

JUDGE:

Long SC, DCJ

ORDER:

The second defendants are to pay the amount of $500.00 to the plaintiff, as damages pursuant to s 115(2) of the Copyright Act 1968 (Cth).

CATCHWORDS:

COPYRIGHT – whether copyright subsists in plans and drawings of a project homebuilder and in a subsequent home built in conformity with those plans – whether copyright is the property of the plaintiff – infringement – whether there has been substantial reproduction or copying – whether there was authorisation of the infringement – damages for lost commercial opportunity or otherwise – additional damages under s 115(4) of the Copyright Act 1968 (Cth)

LEGISLATION:

Copyright Act 1968 (Cth) ss 10, 21, 31, 32, 35, 36, 115

CASES:

Ancher, Mortlock, Murray and Woolley Pty Ltd v Hooker Homes Pty Ltd [1971] 2 NSWLR 278

Carlisle County Homes Pty Ltd v Brown & Residential Developments Mackay Pty Ltd [1999] QDC 284 

Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 419 

Henley Arch Pty Ltd v Luckey Homes Pty Ltd [2016] FCA 1217 2

IceTV Pty Ltd v Nine Network Australia Pty Ltd (2009) 239 CLR 458

Ownit Homes Pty Ltd & Ors v D&F Mancuso Investments Pty Ltd (1988) AIPC 90-488

Roadshow Films Pty Ltd v iiNet Ltd [No 2] (2012) 248 CLR 42.

Tamawood Ltd v Henley Arch Pty Ltd [2004] FCAFC 78

Vanwake Investments Pty Ltd v New-Stat Nominees Pty Ltd & Ors [2005] QDC 57

Sellars v Adelaide Petroleum N.L. (1994) 179 CLR 332 

S.W. Hart & Co. Pty Ltd v Edwards Hot Water Systems [1985] 159 CLR 466

University of New South Wales v Moorhouse (1975) 133 CLR 1

COUNSEL:

M White for the plaintiff

R M De Luchi for the second defendants

SOLICITORS:

Butler McDermott Lawyers for the plaintiff Robinson Locke Litigation Lawyers for the second defendants

Introduction

  1. [1]
    The plaintiff is a project home builder trading as “Coast Life Homes”.  On 17 May 2015 the second defendants (or at least Mrs Flaton) visited the plaintiff’s display home at Bells Reach and met with the managing director of the plaintiff, Mr Kay.
  2. [2]
    Arising from that and subsequent interactions between Mr Kay and the second defendants, is the claim made by the plaintiff for the following relief:

“1. A declaration that the plaintiff is the owner of the copyright subsisting in each of the Coast Life Home’s plans;

  1. Damages pursuant to section 115(2) of the Copyright Act 1968 (Cth) for infringement of copyright in the sum of $40,000;
  2. Further, additional damages pursuant to section 115(4) of the Copyright Act 1968 (Cth) in the sum of $10,000;
  3. Interest upon any such amounts pursuant to section 58 of the Civil Proceedings Act 2011 (Qld);
  4. Costs.”. [1]

It may be noted that similar claims were made against the first defendant, with an additional claim for an account of profits, as an alternative to the second claim, pursuant to s 115(2) of the Copyright Act 1968 (Cth) (‘Copyright Act’), also for $40,000.  It may be further noted that it was admitted in the present proceedings that the plaintiff’s claim against the first defendant had been settled with the plaintiff being paid a sum of $30,000 by the first defendant.[2]

  1. [3]
    It is accepted that, as contended for the plaintiff, the following facts are not materially in dispute:
    1. (a)
      consequently to the meeting on 17 May 2015 and further interactions between the parties, on 31 May 2015 the second defendants were provided with a copy of what is alleged to be an amended version of one of the plaintiff’s house design plans; described as the Byron 214 Revision A Plan;
    2. (b)
      subsequently and in order to reflect some specific adjustments requested by Mrs Flaton, on 7 June 2015 the second defendants were presented with the “Revision B Plan”;
    3. (c)
      as a response to some further amendments requested by the second defendants, as reflected in some handwritten notations on a copy of the Revision B Plan (Ex.2, p. 11), on 10 June 2015 Mr Kay sent them an email with an updated Sales Estimate Sheet;
    4. (d)
      between 11 and 17 June 2015 further emails were exchanged between Mr Kay and Mrs Flaton, relating to the pricing of the plaintiff’s construction of a dwelling at the second defendants’ land, consistently with the Revision B Plan;
    5. (e)
      on 15 June 2015 the Flatons provided by email to another project homebuilder, Edge Designer Homes, a copy of the Revision B Plan for the purposes of Edge

Designer Homes constructing a house on the second defendants’ land;

  1. (f)
    on 17 June 2015, Mrs Flaton advised Mr Kay by email that the second defendants were unable to further the pricing discussions engaged between the parties due to work commitments; 
  2. (g)
    communications between the plaintiff and the second defendants ceased; and
  3. (h)
    on or about 31 August 2015, the first defendant trading as Edge Designer Homes produced a plan for a house to be built on the land of the second defendants, referred to as “967 Newry Street – B” (“Edge Designer Homes Plan”) and between that date and 21 October 2016 the first defendant built a house for the defendants on Lot 967 on Survey Plan 274001 at 83 Newry Street in the Brightwater Estate, Mountain Creek, consistently with the Edge Designer Homes Plan.

The issues

  1. [4]
    Having regard to the pleadings and the legal principles to be applied and particularly those to be derived from the Copyright Act,  the parties conveniently agree that the following are the primary issues to be determined by the Court:
    1. (a)
      does copyright subsist in the Coast Life Homes plans?
    2. (b)
      if copyright subsists, is such copyright the property of the plaintiff?
    3. (c)
      were the Edge Designer Homes Plans (or the Flatons’ house built in accordance with the Edge plans), or both, a reproduction of the Revision B Plan?
    4. (d)
      did the Flatons authorise the reproduction or copying of the Revision B Plan?
    5. (e)
      if there has been an infringement of copyright what is the measure of the plaintiff’s damages?
    1. (i)
      did the plaintiff in fact suffer a loss of opportunity with respect to a contract with the Flatons for the construction of their house?
    2. (ii)
      if so, what is the value of that loss?
    3. (iii)
      if not, how are damages otherwise to be assessed?
    1. (f)
      is the plaintiff entitled to additional damages under s 115(4) of the Copyright Act?
    2. (g)
      what is the effect of the settlement with Edge Designer Homes on any award of damages?

    Each of those issues will be considered in turn.

    Copyright in the Coast Life Homes Plans

  1. [5]
    It is convenient to consider the first and second issues conjointly.
  2. [6]
    As has been noted, the plaintiff is seeking to enforce rights conferred under the Copyright Act.  In particular, the plaintiff brings action pursuant to s 115(1) of the Copyright Act for infringement of its claimed copyright.
  3. [7]
    Pursuant to the Copyright Act and relevantly:
    1. (a)
      Section 31 provides that for the purposes of the Act, and unless a contrary intention appears, ‘copyright’ in relation to a work, is the exclusive right:

“(b) In the case of artistic work, to do all or any of the following acts:

  1. (i)
    to reproduce the work in a material form;
  2. (ii)
    to publish the work;
  3. (iii)
    to communicate the work to the public”.
  1. (b)
    ‘Work’ is defined, in s 10, to include ‘a … artistic work’ and ‘artistic work’ is defined to include ‘a … drawing … whether the work is of artistic quality or not’ and ‘a building or a model of a building, whether the building or model is of artistic quality or not’.
  2. (c)
    Section 32 provides for the subsistence of copyright in respect of “an original … artistic work”, if the maker was an “Australian citizen or a person resident in Australia” when the work is made or substantially made and to continue to subsist after the first publication of the work if that takes place in Australia when the author is similarly qualified.  It is specifically provided that subject to the remaining provisions of the Act, “copyright subsists in … an original artistic work that is a building situated in Australia”.[3]
  3. (d)
    The copyright subsisting in any artistic work is, subject to other provisions in s 35, vested in the author of the work (s 35(2)) and s 35(6) provides that if such work:

“… is made by the author in pursuance of the terms of his or her employment by another person under a contract of service or

apprenticeship, that other person is the owner of any copyright subsisting in the work by virtue of this part.’

  1. (e)
    Subject to any other relevant provision in the Act, s 36(1) provides that:

“… the copyright in a … artistic work is infringed by a person who not being the owner of the copyright and without the licence of the owner of the copyright, does in Australia, or authorises the doing in Australia of, any act comprised in the copyright.”

  1. [8]
    Put simply, the plaintiff’s contention is that both the Edge Designer Homes Plan and the house built by Edge Designer Homes for the second defendants, are so substantially similar to and consistent with the plaintiff’s plans as to be:
    1. (a)
      as far as the Edge Designer Homes Plan is concerned, “a direct reproduction of all of the features of the Revision B Plan”;
    2. (b)
      as far as the house in built form is concerned, “in substance a three-dimensional reproduction of the Revision B Plan”.

And that in such circumstances, there has been infringement of the plaintiff’s copyright in its plans.

  1. [9]
    The evidence supports a conclusion that each of the plans provided by the plaintiff to the second defendants, was produced by an employee of the plaintiff: Mr Van Slyke.  In his evidence to the Court and although he was then no longer employed by the plaintiff, Mr Van Slyke confirmed his prior employment, here in Australia, as a drafts person for the plaintiff for some nine years and six months prior to July 2020.[4]  He proceeded to explain a role in use of a computer program to make adjustments to standard plans of the plaintiff such as those in Exhibit 2 (labelled as the “Byron 215” and “Byron 214” Plans).  He explained how adjustments to standardised plans (which he created) would occur according to the strictures of particular building sites and the requests of clients, as were relayed to him by Mr Kay.[5]  More particularly, he confirmed his preparation of the plans marked as “Flaton Revision A” and “Flaton

Revision B”, with the variations being in accordance with information related to him by Mr Kay.[6]

  1. [10]
    As Mr Kay explained, the further version or the Revision B Plan was discussed with second defendants with some further consequential handwritten notations made by him,[7]  at that meeting with the second defendants (as admitted in the pleadings, on 7 June 2015) and in notation of their additional requirements.[8]
  2. [11]
    Accordingly, on this evidence it is to be concluded that as expressed in each of these documents, the copyright subsisting in each plan to the extent that Mr Van Slyke was the author of them as an artistic work, was that of the plaintiff and ultimately no contrary contention was pressed for the second defendants.[9]
  3. [12]
    Before turning to the specific contentions of the second defendants as to the absence of any such copyright subsisting in these plans, it may be noted that for the plaintiff, reliance is placed upon the following considerations:
    1. (a)
      that the concept of “originality” in the context of project home plans is the subject of the following discussion in Tamawood Ltd v Henley Arch Pty Ltd:[10]

“[38]   The application of the law of copyright to project home plans gives rise to special difficulty. All modern homes have certain features in common. In the case of project homes competing for the same number of dollars, there are pressures towards sameness. Of course, the size, number of rooms and facilities will vary according to the price range. Commonly, however, those in the same price range will be found:

  1. (a)
    to be designed to fit blocks of approximately similar shape and dimensions;
  2. (b)
    to provide for vehicular access and accommodation; and
  3. (c)
    to include features demanded by the market in question, such as, a certain number of bedrooms, a laundry, a kitchen, a family or rumpus room, an ensuite and a walk-in wardrobe (‘WIR’) in association with the main bedroom, built-in wardrobes in the other bedrooms, at least one bathroom in proximity to the other bedrooms, and certain facilities in the kitchen such as a sink, bench, dishwasher, stove, hot plate and microwave oven.

[39]    The idea-form distinction, often elusive, is particularly so in the case of project homes. Yet the originality threshold for copyright protection is low. It is no longer challenged that copyright subsisted in the Chirnside Works and Buildings, as well as in the Baltimore Works and Buildings.”

  1. (b)
    further and as to the distinction that there is no copyright in ideas:

“[41]    The taking of an idea, as distinct from its expression, from a copyright work will also not constitute an infringement, since there is no copyright in ideas: cf Kenrick & Co v Lawrence & Co (1890) 25 QBD 99 (‘Kenrick’). Common examples concern objects in the real world or ideas based on objects in the real world. A person who draws or photographs an object does not, through the copyright in the drawing or photograph, become entitled to prevent others from drawing or photographing the same object, even though there may be a striking similarity between the two drawings or between the two photographs. The drawing of plans for project homes involves a mixture of the use of familiar ideas based on objects in the real world (many other project homes and the plans for them) on the one hand, and labour, skill and judgment (in combining and arranging the various parts) on the other hand. It may be possible to say of each individual part, considered in isolation, that it merely expresses a common idea, yet there will be copyright in the whole plan if the combination and arrangement originated with the author. In protecting that origination, copyright protects the author’s labour, skill and judgment.

[42]   It is reasonable to expect that the more simple, commonplace, familiar and straightforward the subject matter of a copyright work, the closer the similarity that will be required if infringement is to be found: cf Kenrick at 102.”.[11]

  1. (c)
    an explanation of the application of the concept of originality to a design plan, in Vanwake Investments Pty Ltd v New-Stat Nominees Pty Ltd & Ors:[12]

“[44]  It was submitted on behalf of the defendants that the plaintiff did not have copyright in these designs, because they incorporated design elements which originated with others and which were required to be incorporated, and because they were dictated by functional and commonsense considerations rather than the product of original creativity on the part of Mr McConaghy. But that submission in my opinion mistakes the nature of copyright. Copyright operates by reference to works, and a particular plan will be a work. There will be copyright in it if it is an original work. The requirement of originality was explained by Dixon J in Victoria Park Racing and Recreation Grounds Company Ltd v Taylor (1937) 58 CLR 479 at 511: “Some original result must be produced. This does not mean that new or inventive ideas must be contributed. The work need show no literary or other skill or judgment. But it must originate with the author and be more than a copy of other material.” Originality therefore is used in contrast to mere copying. But it may be entirely functional.”; and

  1. (d)
    the acknowledgement in Ownit Homes Pty Ltd & Ors v D&F Mancuso

Investments Pty Ltd,[13] that an original characteristic of a plan is not necessarily compromised nor forfeited in the context of evolution or adaption of it by or for the copyright holder.

  1. [13]
    For the second defendants and in respect of the requirement of originality for the subsistence of copyright, the question is correctly identified as one of degree or extent of an author’s contribution and as being dependent upon the facts of any given case.  Emphasis is placed upon observations as to necessity for origination with the author by the application of some independent intellectual effort, without any requirement of novelty or inventiveness;[14] rather than a collection of other ideas or data.[15]  Although, these are observations made in the particular context of copyright in a literary work.
  2. [14]
    In the further context of correctly noting that the gravamen of the plaintiff’s claim lies in the allegation of reproduction of the Revision B Plan prepared for the second defendants, it is contended that copyright does not subsist in the Revision B Plan for the following reasons:
    1. (a)
      first, because the Revision B Plan is not in fact an adaption of Look Design’s “set design”, the Byron 214.  It in fact bears very little similarly to that plan.  The Revision A Plan (and therefore the Revision B Plan) was created by reproducing large parts of another plan prepared by Morcraft Homes (“Morcraft Plan”).  The kitchen design from yet another plan prepared by Avalon Property Group (“Avalon Kitchen Plan”) and specific requests from Mrs Flaton, all provided to Look Design.  Although there are minor differences from the Morcraft Plan in window placement and configuration of aspects such as the WIR, what stands out in Look Design’s Plan is the overall positioning, orientation and design of the rooms, the entry, the garage and kitchen are all practically identical.  The general relationship between the house and the block is the same.  The drawings depict the same design at least in substance.  They

also indicate the replication of an unusual design feature, namely the connection of both the garage and the main bedroom with the living room.

  1. (b)
    secondly, the evidence does not support a conclusion that Mr Van Slyke applied the degree of skill and labour required to make the plan an original work or design.  The software used by the Plaintiff enabled the creation of the plan without creative or critical application of thought by Mr Van Slyke.
  1. [15]
    At the heart of the first contention is a factual dispute.  The evidence of Mrs Flaton was that when she was initially engaged with Mr Kay, as to what they were seeking and in the context of her unsuccessful attempts to sketch the effect of their prior involvement in developing a floor plan with another project builder and Mr Kay’s request as to whether they had “any plans that [they] had liked or seen”, that he was shown a plan which they had obtained from engagement at the “Morcraft display”.[16] Her further recollection was that when shown “a copy of that plan” she recalled Mr Kay actually stating that it was a bit weird that the doors of the bedroom and garage came out into the living/dining area.[17]  She could not recall whether Mr Kay took a copy of the “Morcraft Plan” or just sketched the layout by hand.[18]  Earlier, Mrs Flaton had described their prior interaction with “Morcraft builders or Morcraft Homes” and attending their display in Brightwater and as represented by the layout plans earlier produced for them.[19]  She explained:

“We’d gone and visit them a fair few times because, obviously, we liked the design that they’d come up with.  But, then, we wanted to change a few different things on that design.  So, we’d spent hours sitting there with him moving the plans around on different occasions, and we were very happy with what he’d come up with.  But before we actually thought we’d go any further with him, we’d actually have a look around and actually look at different houses to make sure we were making the right decision and different builders to secure a good price and the right home.”.[20]

  1. [16]
    Mr Flaton gave similar evidence, including that he went to their car to retrieve a copy of the Morcraft Plan and that Mr Kay copied it.[21]  He was never asked to clarify what he meant by saying that Mr Kay copied it.[22]
  2. [17]
    In contrast, Mr Kay made no reference to viewing or obtaining any earlier layout plan in his discussions with, in particular, Mrs Flaton as to what they were seeking and he specifically denied that:
    1. (a)
      he had asked the Flatons whether they had seen another plan they liked;[23] and
    2. (b)
      he ever saw or received the Morcraft Plan.[24] 

He also expressed doubt as to whether Mr Flaton was even present at the first meeting on 17 May 2015 at the Look Design display home, as a matter of recollection.[25]

  1. [18]
    For the plaintiff, there is some criticism of Mrs Flaton’s evidence that the Morcraft Plan was available to be given to Mr Kay on 17 May 2015, as they had earlier that day revisited the Morcraft display,[26] when it is noted that the last version of the Morcraft Plan and the one said to be shown to Mr Kay, has a reference to the date 13 May 2015 written over the date 11 May 2015 (as appears on a prior version of the Morcraft Plan).[27]  However, there is no necessary contradiction of or inconsistency with the evidence of the second defendant as to the availability, on 17 May 2015, of the earlier dated Morcraft Plan. 
  2. [19]
    Whilst Mr Kay maintained that he had no interaction with Mrs Flaton (his recollection being that he only dealt with her on 17 May 2015), as to her drawing or producing anything else which they had seen and liked, he conceded that he may have indicated that given the exigencies of their block of land and their criteria, he didn’t immediately have anything which would be suitable but that he would come back to them with a plan, which was the Revision A Plan.[28]
  3. [20]
    It is clear that, as contended for the second defendants, the Revision A Plan does incorporate some features referable to the layout in the Morcraft Plan, including in respect of the positioning of the garage and main bedroom. It may also be concluded that in some other respects as well there is a greater appearance of similarity with the Morcraft Plan layout than with the plaintiff’s Byron 215 floor plan.[29] Although it is also necessary to understand that there were some particular constraints, for instance in terms of the location of the garage, due to the exigencies of the site for the building and that what is sought to be represented is a plan suitable to the desires of the second defendant.
  4. [21]
    There is a valid criticism of Mr Kay’s evidence in that his insistence that he would not refer to other builder’s plans when preparing plans for clients, as opposed to referencing the plaintiff’s own “back catalogue” of plans, (including those prepared for other clients) was later contradicted by his admission as to receipt from Mrs Flaton, in the context of discussions with her as to modifications to the kitchen layout in the Revision A Plan, of an extract from a plan prepared by another home builder in respect of her old and desired kitchen layout and which may be seen as reflected in the Revision B Plan.[30]
  5. [22]
    There are also many criticisms directed at aspects of the evidence of each of the second defendants (more particularly relating to an issue to be later discussed) and there is considerable nuance to be understood in respect of the evidence given as to the interactions between Mr Kay and the Flatons. For instance and in respect of the last point noted as to Mr Kay’s evidence, it should also be noted that he was prepared to accept the common experience of personal preference in respect of kitchen layout and a preparedness to accept that and to work to achieve such requirements where possible. 
  6. [23]
    None of these witnesses presented as dishonest in their recollections. As to issues of reliability, it might be considered that some occurrences may have been of greater significance or more memorable to one rather than another and that a general tenor in Mr Kay’s evidence, apart from matters of usual practice and reference to written records, was expression in terms of his recollection or best recollection, rather than unambiguous fact. Moreover, neither of the second defendants were definitive in asserting that he took an actual copy of the Morcraft Plan, as opposed to noting particular features of it.[31] And it was the concept of suggested reproduction or copying of that plan which appeared to be of most concern to Mr Kay. Whilst it would appear to be likely that some reference was made to a document representing the Morcraft Plan, it is, in the end, unnecessary to attempt to resolve this particular factual dispute, in order to conclude the issues of originality and subsistence of copyright in the Revision B Plan. 
  1. [24]
    In the first instance, that particular representation of a floor plan or layout was undoubtedly prepared by Mr Van Slyke to adapt the earlier Revision A plan (itself, a particular representation in adaptation of an existing standard layout he had prepared for the plaintiff), which he also prepared in the course of his employment with the plaintiff. In each instance, it must necessarily be understood that these plans were prepared upon information relayed by Mr Kay from his various interactions with the second defendants and particularly Mrs Flaton, to attempt to meet their requirements or expectations, in the obvious context of attempting to gain the building contract for their new home. 
  2. [25]
    Accordingly, such a process must be driven by information provided as to such requirements and expectations. Leaving aside any contention of reproduction of an earlier plan of another building, which is not contended nor apparent here, given the degree and substance of differentiation from the Morcraft Plan, evident on visual comparison, the essential distinction is as between ideas or concepts and a particular representation of them. In Ownit Homes, there was particular reference to the following observations:

“In Ladbroke (football) Ltd v William Hill (football) Ltd (1964) 1 WLR 273 Lord Hodson at p.285 said that:

‘common place matter put together or arranged without the exercise of more than negligible work, labour and skill in making the selection (or house design) will not be entitled to copyright. “whether enough work, labour and skill is involved, and what its value is, must always be a question of degree”, Cramp and Sons Ltd v Frank Smythson Limited (1944) 2 All England Reports at p.97, per Lord Parker’.

Lord Pearce at p.291 said:

‘the word “original” does not demand original or inventive thought, but only that the work should not be copied and should originate from the author’.

It should be noted, however, that works which might seem to have fulfilled Lord Pearce’s minimal requirements have not always been held to be ‘original’: see for example G.A Cramp and Sons Ltd. v Frank Smythson Ltd. (1944) A.C.329.

In the New Zealand case of Beazley Homes Ltd v Arrowsmith (1978) 1 N.Z.L.R. 394, McMullin J. in considering whether plans of low-cost houses showing little or no architectural innovation were indeed ‘original’ for the purposes of the Copyright Act 1962 (N.Z.) said at pp.402-403:

‘I do not think that the similarity which, on account of the considerations I have just mentioned [the various restrictions upon a designer of low-cost housing], the plaintiffs’ plans bear to other plans of a common type, precludes the claim of originality being made for them…

Indeed, it seems to me that there may be some force in the plaintiffs’ claim that because the range for skill and design are limited, the need for their exercise is greater. The architect and plan drawer are not deprived of all opportunity for exercising their skill and judgement’.”[32]

  1. [26]
    Whilst Mr Van Slyke accepted that his authorship of the Coast Life Homes plans was by use of a computer aided drafted program, that, in itself, is not a sufficient reason to find any absence of sufficient application of his skill and effort, so as to deny the subsistence of copyright in the plan which was produced as the Revision B Plan for the second defendants. 
  2. [27]
    It is of importance to note that as Mr McDonald (who was employed as the General Manager for Coast Life Homes, including in 2015) explained, that sitting behind the standard and other adapted plans of the plaintiff is the reflection of time and effort towards ability to make the floor plan in built form. More particularly, to enable a building cost to be estimated and provided to a client.[33] That enables the “bridging” of any gap from standard to modified version, by a series of calculations in respect of the differences incorporated in the adapted designs.[34] That includes having regard to base price of each standard design, as previously calculated with input from “suppliers” and “trades”.[35] 
  1. [28]
    In that context, it should also be accepted that, as Mr Van Slyke explained, he began by taking those aspects of the Byron 214 standard plan, which are discernible as being reflected in the Revision B Plan, in what he described as the “CAD file for it”[36] and then adapted it for the design sought by the client, according to the information brought to him by Mr Kay.[37] And, in rejection of the suggestion put to him as to lack of substantial effort or input on his behalf, his evidence was:

“I suggest to you that a preliminary conceptual plan without any elevations, which is what I understand the Coast Life plan to be, I suggest to you that creating a plan like that would approximately – would approximately take two hours?---It would take a lot longer than that because a lot of the other work is created at the same time. It’s just not published. So things like the elevations are generated at the same time as doing the floor plan. They’re just not published.  There weren’t any elevations for this plan though, were there?---No, there weren’t. We don’t publish those at that stage”.[38]

Earlier, Mr Van Slyke had responded to another related suggestion as follows:

“Okay. So to go from – to go from, say, your Byron 214 plan to the Revision B Plan the program would actually make it quite easy for you to change some of the internal walls to move some of those rooms?---It is quite easy to generate new rooms. But the difficulty comes in in applying those rooms so that they flow and getting code compliance with those as well. So you’ve got lighting and ventilation to consider for every room. You’ve also got to make sure that the block – that the house sits inside of the lot boundaries and the building envelope. 

But that wouldn’t be so much of an issue if you’re moving rooms around within the same building footprint, would it?---It depends on if the internal walls are shifting as well. If any of the internal walls are shifted all the calculations have to be redone”.[39]

Later in cross-examination there was this:

“Would you agree, or disagree, with the suggestion that when it comes to project home plans and, in particular, if we’re talking about a four bedroom, single storey house, there aren’t a great deal of – there isn’t a great deal of creativity that can be applied when you’re trying to fit a house on a standard, small sized block?---In terms of width, that’s true, but it’s site specific. It depends on the site. 

Naturally?---Yep.

But when it comes to, for example, the master bedroom lay-out, you’ll quite commonly see a very similar lay-out with a master bedroom, an L-shaped walk-in robe and an en suite not dissimilar to what you’ve drafted on your plans with a shower, basin, a double basin and toilet?---Most of the time, yes. 

And is it, also, quite common to see the living dining and kitchen all in open plan, especially - - -?---These days it is, yes. 

These days?---Yep. 

So you said you didn’t create the elevations for the Byron revision plans. I suggest to you that that would have saved you a significant amount of time in preparing those plans?---They’d need to be created at the same time for the floor plan to work. So you’ve got to make sure the whole house can work before you show a client. There’s no point showing them something that doesn’t work. So we do need to check those things. 

But you said that you didn’t create the elevation. 

HIS HONOUR: No that wasn’t his evidence. His evidence was that it was all done, just not published?---It wasn’t published. The elevations were created, but they weren’t published, yeh”.[40] 

At least as some context for these passages, it should be further noted that in his evidence in chief and when asked to comment on the rudimentary room-size measurements shown in the Revision B Plan, Mr Van Slyke further explained as follows:

“In terms of the measurements on this plan, can you comment on what those measurements are?---So these – the measurements at this preliminary stage, we don’t do fully dimensioned plans. We do do notations of those internal dimensions, so you’ll see, for instance, the garage has six metres by 5.7, which refers to the height and width of the garage. Same with the media room, 4.3 by 3.3. That’s – we just do that just to save investing too much time in producing a full working document. 

When you say investing too much time, what do you mean by that?---Well, for one, it makes it difficult to take to someone else and copy, because all the working is already done. It’s already out on display, which is one of the reasons why we use text dimensions instead of notated dimensions, and it does take quite a bit of time to produce fully dimensioned drawings”.[41]

  1. [29]
    Notwithstanding the rudimentary nature of the plan provided to the second defendants, as the Revision B Plan and the absence of the overt representation of work explained by him to be sitting behind it, it is clear that the preparation of it  required some time effort and skill on the part of Mr Van Slyke, as a particular representation of concepts and ideas in a layout or floor plan of a house which could be built for the needs of the second defendants and priced for them, as was done in broad terms by the provision of sales estimate sheet by email from Mr Kay on 10 June 2015.[42] As Mr Van Slyke further observed, not only could he quite easily add the detailed measurements to the Revision B Plan but “anyone who knew how to do it could quite easily do it”.[43]
  1. [30]
    In these circumstances, it should be concluded that, as expressly represented on it, there is subsistence of the plaintiff’s copyright in the Revision B Plan.

Were the Edge Design Homes Plans or the Flatons’ house built in accordance with those plans, or both, a reproduction of the Revision B Plan?

  1. [31]
    As to the questions of reproduction, the applicable principles were stated in S.W. Hart & Co. Pty Ltd v Edwards Hot Water Systems:

“The notion of reproduction, for the purposes of copyright law, involves two elements - resemblance to, and actual use of, the copyright work, or, to adopt the words which appear in the judgment of Willmer L.J. in Francis Day &Hunter Ltd. v. Bron (1963) Ch 587, at p 614, ‘a sufficient degree of objective similarity between the two works’ and ‘some causal connection between the plaintiffs' and the defendant’s work’”.[44]

Although not expressly referred to in the Copyright Act, the concepts of “objective similarity” and “causal connection” are the recognised components of the concept of reproduction in that Act.[45]

  1. [32]
    As the issue of infringement of copyright was approached in Ownit Homes, it was identified as involving proof of reproduction, or substantial reproduction or copying.[46] Reference is made to dicta from authorities including S.W. Hart & Co Pty Ltd v Edwards Hot Water Systems, as to the potential interrelationship of “two factors which are involved in reproduction, namely similarity and copying”. That included

notation of the following observations of Street J, in dealing with the question of resemblance, in Ancher, Mortlock, Murray and Woolley Pty Ltd v Hooker Homes Pty Ltd:

“If the defendant’s architect had drawn the plans that are here challenged as infringements after a mere inspection and examination of the plaintiffs' plans and houses, the present case would fall within what I have earlier described as the grey band. The similarities and the dissimilarities, weighed together and weighed separately, might well have led me to the conclusion, particularly in the split-level house, that no infringement had occurred. The defendant might well have been credited with having engaged in a bona fide application of the concept and ideas of Mr Woolley, and not in an unfair copying of his expression of concept and ideas”.[47]

And also the observations of Gibbs CJ in the S.W. Hart case, in confirmation of a majority conclusion of reproduction in the Federal Court, below:

“… in the light of the fact that the respondent actually copied the appellant's drawings, obviously for the purpose of appropriating the benefit of the appellant's labour, and having regard not merely to the volume, but to the significance, of the similarities between the respondent's products and the drawings …”.[48]

  1. [33]
    In the present case, there is no direct evidence of actual copying. However, there is no dispute that Edge Developments Pty Ltd was given access to the Revision B Plan. Also, there is no suggestion that this occurred with the consent or licence of the plaintiff. There is evidence that Mr Flaton forwarded a copy of it, by email, on 15 June 2015.[49]
  2. [34]
    Mrs Flaton said that this was done with her knowledge and “because the builder asked for it”.[50] There is then the following exchanges:

“Is it fair to say that the plans that Edge eventually produced for you, they were based on this plan that you sent through?---Possibly, yes. 

And that that was your intention in sending Edge these plans?---No, he told us that he only had to change it 10 per cent, any plan from any builder. 

Were you happy with the Coast Life plans that you’d received at this stage?--I liked the layout and I liked the Morcraft layout.

I’m not sure I understand. Why, then, were you continuing to deal with Morcraft after all this time if you still liked their plans?---Because we were shopping around. 

Okay. But again you didn’t have any issues with the pricing that Morcraft had offered you to build the plan – to build a house consistent with the plan that you liked?---I didn’t have an issue with the price, no. 

Okay. All right. I’d suggest that after you sent through this plan, Edge then produced plans consistent with this plan; do you agree with that?---They’re not exact.  

And then Edge then built a house in accordance with those Edge plans that had been developed by them?---The Edge plans, yes”.[51]

And further:

“HIS HONOUR: When – who was it that you were dealing with at Edge who told you that the plans just had to be changed by 10 per cent?---Nigel. 

When?---At our first meeting. Any plans and they need to be changed by 10 per cent. 

Is that before you sent through the - - -?---Yes. 

- - - revision B plan to him?---Yes. 

Do you wish to pursue that, Mr White? 

MR WHITE: I do briefly, your Honour. Why did that come up as a point of discussion that he only had to vary them 10 per cent?---Because we had both plans there at the time. Any plans that we were looking at he said they’d only had to be changed 10 per cent if we liked the design. 

So you told him you wanted the Coast Life Homes design?---We didn’t tell him we wanted it exact, but we said we liked the design, yes. I said that we liked also the Morcraft design as well. 

And it was in response to you saying that you liked the plans that he told you it only has to be changed 10 per cent?---That’s right, yes. 

But your general instructions to him were can you please build me a house that looks like this; is that fair?---No.

No. What do you say is different from that?---He was going to get his architect to change the plans. 

By 10 per cent?---Yes. 

So he was going to change them by 10 per cent in order to do what?---So he can build us a house. 

So he can build you a house consistent with those plans without getting in trouble?---Yes, I suppose so, yes.

So surely that was an indication to you that you were doing something wrong?--Didn’t cross my mind at the time, no”.[52]

Then in re-examination:

“MS DE LUCHI: It was just suggested to you that Nigel was going to get his architect to change these plans by 10 per cent, and that was because Nigel didn’t want to get into any trouble. Did he say that to you at all?---No. He just said that we – he had to change any plan 10 per cent. 

And you trusted that was the case?---Yes”.[53]

  1. [35]
    In his cross-examination, Mr Flaton explained the sending of the email attaching the Revision B Plan, as follows:

“Did – do you remember any dealings at all with Nigel, meetings or otherwise, before you sent this email?---I had – everything with Nigel was rather blasé. It was his – one of his – he was just starting out so it wasn’t a, “Come into my sales office,” type thing. It was go to someone’s house. So yeah. 

So do you remember if you went to his or he went to yours?---I went to his house.  And what was discussed while you were there?---On what date? When? 

This - - -?---On our first meeting? Our first meeting was about building us our house.

And how long before this email was sent? Can you recall in a general sense?---I wouldn’t. 

Who else was at that meeting?---Pardon? 

Who else was with you at that meeting?---My wife. 

And what did you ask of Nigel at that meeting?---I just asked him if he could build me something similar to – on this – no, something similar to what I’d seen at Coast Life. A four bedroom house with - - - 

Can you just clarify that answer. Did you say if he could build you something similar to - - -?---No, I - - - 

So you didn’t have a document?---No. 

Okay. So you said, “Can you build me something similar to what I’ve seen in Coast Life”?---Yes. And I tried to draw it and I couldn’t draw it. 

Yes?---So he said, “Just email it to me.” And I - - - 

So I’m – could I just stop you there. So you said to him, “I’d like you to build me something that looks like this”?---Yes, and I was drawing it on a piece of paper. 

You tried to draw it and you had trouble?---Yep. 

So then you sent him through the plan?---Yep. 

So his instructions were, “Build me something that looks like this”?---And change it. 

Well, can you explain the change it part. When did that first get discussed?---That was when I gave him the plan, the copy of the plan. I asked him to change it.  When? When did you give him a copy of the plan?---When I handed him the – when I – not handed, when I emailed him the copy. Me and my wife both said,

“Can you change it. Can you put your own spin on it,” basically. 

Can you please go to page 53 of that bundle. Is that an email from you to Nigel?--At Nigel, regards Phil. Is - - - 

Did you send that email?---Yes. 

And then the next page. Was that plan an attachment to that email?---Yes. 

So there’s no reference there to, “Can you please change it or put your spin on it,” is there?---It was a verbal.

When do you say that was?---When – when we actually sent the plan. It was – I did ask him to change it. 

And why did you ask him to change it?---Because of obvious – obvious reasons. They can’t be identical.

I see. So why can’t they be identical?---He actually suggested that we need to change it - - - 

Can I take you - - -?--- - - - for copyright reasons. 

Can I take you back to those plans that you’ve got in front of you there. The attachment?---Yep. 

If you have a look at that plan below the building footprint, the house footprint?---

Mmm. 

There’s a notation there: 

These plans are the property of Coast Life homes and are protected by copyright. No part may be used, reproduced or copied by any means or in any form without prior permission of Coast Life homes.

?---Yep. 

Have you read that?---Yep. 

What did you take that to mean when you read it?---Well, obviously, with the discussion of Nigel, we can’t duplicate the house. 

Yes?---So - - - 

So you knew – you knew that he couldn’t copy that?---We tried to rearrange it and he said, “I’ll just get my draftsman or architect or whatever you want to call it

to - - -” 

So the purpose for you rearranging it was to avoid getting in trouble because of that notation?---Yes. 

That’s the only reason why you rearranged it?---Well, you can’t – to my belief, you couldn’t reproduce it, so. 

So is it fair to say that, in sending that plan through, you kind of knew that what you were doing wasn’t necessarily the right thing to do?---Not until it was actually brought up by the builder. When he said, “I can’t copy it, I’ve got to change it.” So we tried to change it and we couldn’t figure a way to change it, so he said his architect or draftsman would change it”.[54]

  1. [36]
    Although this evidence is also relevant to the further issue as to whether the second defendants authorised a reproduction of the Revision B Plan, their admissions as to the discussions with Edge Developments, as to the basis upon which that builder was given access to the Revision B Plan, is necessarily important context to consideration of any objective similarity in the Edge Designer Homes Plan and the house built, and therefore the questions as to reproduction.
  2. [37]
    The plaintiff refers to the following observations as to the need for a qualitative rather than quantitative assessment, in order to determine whether or not “a substantial part” of the artistic work has been reproduced:

“[158]    First, the relevant assessment is a qualitative assessment rather than a quantitative assessment. Indeed, it has been said that “the quality of what is copied is critical” (IceTV Pty Ltd v Nine Network Australia Pty Ltd (2009) 239 CLR 458 at [30] per French CJ, Crennan and Kiefel JJ). The question is whether there is a sufficient degree of similarity between the two works objectively assessed (Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd (2012) 95 IPR 64; [2012] FCAFC 4 at [46] per Jacobson, Nicholas and Yates JJ and Tamawood Ltd v Habitare Developments Pty Ltd (2015) 112 IPR 439; [2015] FCAFC 65 at [19] to [35] per Greenwood J, albeit partly in dissent but not as to the relevant principles). The other dimension to reproduction, ie a causal connection between the two works (ie copying), can be put to one side for present

purposes. It is not now in doubt that Henley Arch’s floorplan was the starting point for the respondents’ annotations, modifications, reproduction and use both in two dimensions and in three dimensions.

  1. [159]
    Second, merely pointing to dissimilarities between the various plans does not establish that a “substantial part” of the relevant copyright work has not been copied. 
  2. [160]
    Third, whether there has been a reproduction including a copying of a “substantial part” involves questions of fact and degree. If similarities are identified, the question is the qualitative significance of such similarities. Reproduction does not strictly require a complete and accurate correspondence to a “substantial part” of the work (SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 at 482 per Wilson J).
  3. [161]
    Fourth, as the trial judge, I can be credited with at least some modicum of ability to read and interpret design drawings and to make relevant comparisons without relying upon expert opinion evidence in order to assess whether there has been a reproduction or the copying of a “substantial part” of an artistic work. 
  4. [162]
    Fifth, in the case of project home plans, whether there is sufficient “objective similarity” depends on whether the allegedly infringing drawing has adopted the essential features and substance of the copyright work (Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415 at [91] per Lindgren J.) 
  1. [163]
    Relatedly, the substantial part of the work that has been taken must be assessed by reference to the whole of the copyright work. That is, the question is not whether there has been infringement of a part of the work but rather whether there has been infringement of the work as a whole by the taking of a substantial part of that work (Tamawood Ltd v Henley Arch Pty Ltd (2004) 61 IPR 378; [2004] FCAFC 78 at [55] per Wilcox and Lindgren J). In Clarendon Homes (Aust) Pty Ltd v Henley Arch Pty Ltd (1999) 46 IPR 309; [1999] FCA 1371, it was held (at [37] per Heerey, Sundberg and Finkelstein JJ) that a substantial part is taken if it is “an important or material part” of the copyright work. Another way to express the point is to ask whether “the part or parts taken represent a substantial part of the labour, skill and judgment of the author that made the whole [artistic] work ‘original’” (see Tamawood Ltd v Henley Arch Pty Ltd at [55] per Wilcox and Lindgren JJ). Further, it is not necessary to show that the copy is a “perfect reproduction of a substantial part” of the copyright work. 
  2. [164]
    Sixth, the animus furandi may be relevant to the present question. Where there is deliberate copying, this may assist to more readily conclude that there is the requisite sufficient objective similarity between the infringing and copyright works or a substantial part of the copyright work.”.[55]

And more particularly, in respect of the comparison of two-dimensional drawings:

  1. (a)
    “It is important to focus on the two-dimensional expression of these aspects rather than the functionality or ideas underpinning these aspects. It is trite to observe that plans for project homes may incorporate commonplace concepts involving the number and type of standard types of rooms (bedrooms, bathrooms, kitchens, lounge rooms etc), their relationship with each other, traffic flow, ingress and egress and the like. And it may be said, superficially, that many residential home designs will have substantially overlapping themes dealing with such matters. That is not really to the point. What is being looked at for present purposes is rather the form of the expression of such commonplace concepts and ideas. The question of objective similarity is a comparison between forms of expression, rather than between ideas or concepts.”;[56] and
  2. (b)
    “One of the matters which must be borne in mind when comparing plans is that the more commonplace and straightforward the plan the more precisely the supposed copy has to adhere to the original before it can properly be found to be a copy of the original: Dixon Investments Pty Ltd v Hall (1990) 18 IPR 481 at 483; 490 at 496. Conversely, where there is an unusual or special feature of the original, reproduction of that feature will strengthen the argument that the supposed copy is in fact a copy. Another general proposition which appears from the cases is that minor differences in detail, such as minor changes in dimensions which do not affect the general layout or the overall proportions of what is shown are not of any real significance. Such matters are not uncommonly dismissed by other judges in a few words.”.[57]
  1. [38]
    As to the question of reproduction of the Revision B Plan, the two-dimensional comparison is assisted by placement of an A3 copy of the Edge Designer Homes Plan, in transparent form (exhibit 5), over an A3 copy of the Revision B Plan.[58] When that is done, there is, as noted by Mr Van Slyke,[59] assistance towards an obvious sense of overall correlation of layout and dimension in each of the plans. That is, both in a quantitative sense and more particularly qualitative sense, in terms of the overall effects. As pointed out for the second defendants, Mr Van Slyke also conceded some observably discernible differences.[60] Particular reliance is placed upon:

“… the obvious ones being the larger front façade and change to roof line, removal of the stepped wall at the front of the house where the media room appears, differences in window types and sizes (for example B3 and media rooms), the alcoves off the living room wall, the bulk head in the entry, the difference in size of the al fresco area, the exterior materials (mostly brick veneer in the Revision B Plan, but mostly cladding in the edge plan), and the positioning of the kitchen appliances.”.[61]

  1. [39]
    In reality, these are minor issues and the discernible differences may be seen as further adjustments or modifications to the Revision B Plan, which is essentially replicated. For instance, in respect of the reliance upon the differences in the positioning of the kitchen appliances, the differences in the Edge Designer Homes Plan are reflective of what was raised with Mr Kay in respect of the Revision B Plan and as particularly reflected in the extract of another plan (in relation to Mrs Flaton’s old and preferred kitchen layout) as sent to him by email.[62] Another example, is the inclusion of an external grade door to the side of the garage, which was discussed with and noted by Mr Kay on a copy of the Revision B Plan.[63]
  2. [40]
    Notwithstanding what may be regarded as the relatively standard nature of the floor plan, in terms of types, shapes, sizes and configuration of rooms and spaces and the absence of any particularly distinctive or unusual features,[64] there is, in the context of the circumstances of Edge Developments gaining a copy of it, such substantial correlation to the Revision B Plan as to objectively bespeak substantial copying or reproduction of it. That is, in the sense of taking advantage of the time and effort expended and represented by the plan prepared by Mr Van Slyke for the plaintiff, in preparation of a workable floor plan to suit the configuration and exigencies of the second defendants’ site and their substantial requirements. Another relevant circumstance is that Mrs Flaton’s evidence was that she was aware that the first defendant did not have “standard plans” but “did design houses”.[65]
  3. [41]
    Accordingly, it is to be concluded that the Edge Designer Homes Plan has been prepared in infringement of the copyright subsisting in the Revision B Plan to the benefit of the plaintiff. 
  4. [42]
    The further contention of the plaintiff that the house built in accordance with the Edge Designer Homes Plan is similarly an infringement of that copyright, is met by contentions for the second defendants which are critical of the absence of any more detailed plans, including any proof by the plaintiff of any more detailed plans, including any elevations or more precise measurements or exterior design details of the residence to be built in accordance with the Revision B Plan. The contention is that it is therefore difficult to make any comparison in respect of “an imagined constructed version of the Revision B Plan, a floor plan without anything more without assuming many elements of design that were not proved”.[66] 
  5. [43]
    However, the difficulty is in accommodating such submissions in the context of the plaintiff’s understandable reliance upon s 21(3) of the Copyright Act, which provides:

“For the purposes of this Act, an artistic work shall be deemed to have been reproduced:

  1. (a)
    in the case of a work in a two-dimensional form – if a version of the work is produced in a three-dimensional form; or
  2. (b)
    in the case of a work in a three-dimensional form – if a version of the work is produced in a two-dimensional form;

and the version of the work so produced shall be deemed to be a reproduction of the work.”.

Indeed, there is no submission made in response to that reliance or as to how s21(3) is not applicable, as the plaintiff contends.[67]

  1. [44]
    Accordingly, it is to be concluded that the effect is that once, as it is established here, the second defendants’ house has been constructed in accordance with the Edge Designer Homes Plan, as a substantial reproduction of the Revision B Plan, the result, in the words of s21(3), is that “a version of the [Revision B Plan] is produced in a three-dimensional form”, “deemed to be a reproduction of the [Revision B Plan]”. And also therefore, an infringement of the plaintiff’s copyright “to reproduce the work in a material form” (s31(1)(a)(i)). 
  2. [45]
    Therefore, it is concluded that the plaintiff has established that there has been infringement of its copyright in the Revision B Plan, by reproduction of it in material form, both as the Edge Designer Homes Plan and as the house built on the second defendants’ land in accordance with the Edge Designer Homes Plan. All of that, of course, has been done by the first defendant, albeit under engagement as the agent of the second defendants to do so.

Authorisation

  1. [46]
    Finally and in order to establish infringement of its copyright by the second defendants, the plaintiff seeks to establish that they “authorise[d] the doing in Australia of [such acts]”.[68]
  2. [47]
    The concept of authorisation is not defined in the Copyright Act.  However, s 36(1A) provides that:

“(1A) In determining, for the purposes of subsection (1), whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the owner of the copyright, the matters that must be taken into account include the following:

  1. (a)
    the extent (if any) of the person’s power to prevent the doing of the act concerned;
  2. (b)
    the nature of any relationship existing between the person and the person who did the act concerned;
  3. (c)
    whether the person took any reasonable steps to prevent or avoid the doing of the act, including whether the person complied with any relevant industry codes of practice.”.
  1. [48]
    In Roadshow Films Pty Ltd v iiNet Ltd [No 2],[69] a history of the emergence of a concept of “authorisation” of an infringement of copyright at common law, is traced, in the context of the same provision which is relevantly at s 36(1A), being then found as s 101(1A),[70] with the adoption of the dictionary meaning or sense of “sanction, approval, countenance”.[71] As is also noted,[72] the genesis of what appears in s 36(1A) and particularly in sub-paragraphs (a) and (c) lies in the following observations, as to the relevant concept of authorisation, of Gibbs CJ in University of New South Wales v Moorhouse:[73]

“Gibbs J likewise accepted as the meaning of authorise the dictionary sense, referred to in Adelaide Corporation, of ‘sanction, approve, countenance’. His Honour then cited passages from that case to support the proposition that ‘[a] person cannot be said to authorise an infringement of copyright unless [the person] has some power to prevent it’. His Honour went on to say:

‘[A] person who has under his control the means by which an infringement of copyright may be committed – such as a photocopying machine – and who makes it available to other persons, knowing, or having reason to suspect, that it is likely to be used for the purpose of committing an infringement, and omitting to take reasonable steps to limit its use to legitimate purposes, would authorise any infringement that resulted from its use.’”.

  1. [49]
    Here the plaintiff relies upon the fact of the provision of the Revision B Plan by the second defendants to the first defendant and contends that the “only reason” for doing so was for reproduction of it.[74]
  2. [50]
    Mrs Flaton’s evidence in chief as to their interactions with the first defendant was very brief.[75]  She simply explained that “Edge Designer Homes” ended up building their house and that “[h]e was a friend of the family, that she did not previously know him as opposed to “of him” and that he lived around the corner from her brother-in-law.[76]  In cross-examination of Mrs Flaton and after she conceded that the Edge Designer Homes Plan was “possibly” based on the Revision B Plan which they sent through, there was this exchange:

“And that that was your intention in sending Edge these plans?---No, he told us that he only had to change it 10 per cent, any plan from any builder.”[77]

and later:

“Why did that come up as a point of discussion that he only had to vary them 10 per cent?---Because we had both plans there at the time. Any plans that we were looking at he said they’d only had to be changed 10 per cent if we liked the design. 

So you told him you wanted the Coast Life Homes design?---We didn’t tell him we wanted it exact, but we said we liked the design, yes. I said that we liked also the Morcraft design as well. 

And it was in response to you saying that you liked the plans that he told you it only has to be changed 10 per cent?---That’s right, yes. 

But your general instructions to him were can you please build me a house that looks like this; is that fair?---No.

No. What do you say is different from that?---He was going to get his architect to change the plans. 

By 10 per cent?---Yes. 

So he was going to change them by 10 per cent in order to do what?---So he can build us a house. 

So he can build you a house consistent with those plans without getting in trouble?---Yes, I suppose so, yes.  

So surely that was an indication to you that you were doing something wrong?---Didn’t cross my mind at the time, no”.[78]

  1. [51]
    Mr Flaton’s evidence in chief on this topic was encapsulated as follows:

“MS DE LUCHI: Were there any other builders that you were speaking to at the time that you were speaking to Mr Kay?---We’d been through a hell of a lot of builders. I can’t recall each individual one, but I know we went through Stroud. I think it was Stroud – Stroud Homes. 

When you said “been through” do you mean – what do you mean?---Been through their display homes. 

Okay?---I’d asked Edge whether he could do my house. I asked Nigel. And before I actually went and seen anybody, and he told me that he was out of my price range. 

HIS HONOUR: Which was? 

MS DE LUCHI: Do you remember when that might have been?---No. I know it was before I went and looked at any houses, so. 

Okay. And in what context did you ask him?---Just in general talking, because he was a friend of my brother’s, so I just asked him in my price range of about 205,000 – 205/$210,000 whether he could build me a house, and he said no, so. 

Did you approach him again at a later stage?---Yep. 

And what was the process that time?---Obviously since we’d been going around, our budget – as you go around and look at things, your budget grows. So we

asked him if – what price he would be round about able to do. And I think it was 230,000 roughly. 

Do you recall what your – did you ultimately end up signing a contract with Nigel from Edge?---Yes. 

Do you recall what that contract price was?---No. 

Okay. Could you just turn to page 102 in that – in exhibit 1, which is the white bundle?---One hundred and two? 

Yes. Do you recognise that document?---Yep. 

Is that your contract with Edge?---Yeah.  

And do you recognise the contract price on the first page?---Yeah. 

It’s 209,400?---Yeah. That’s without electrical”.[79]

In cross-examination and after identifying two particular obstacles to engaging the plaintiff to build their homes (being their aversion to a “waffle pod slab” and their desire to have Mr Flaton’s brother do the electrical work), there is the following:

“What were you trying to achieve out of those dealings with him if you weren’t going to proceed with him as a builder?---We were just shopping – basically window shopping. 

But in the meantime, he’s preparing these plans for you, yes?---Yes. 

And they’re customised to what you wanted?---Yes.

And they’re customised to your block?---Yes. 

So what I’d suggest is you’re not really shopping with Mr Kay to enter into a contract with him. You’re shopping for his plan?---No. I’ve been house shopping – yeah, when you go shopping you sit down and you talk to people. You – yeah. You don’t just go there - - - 

Can you provide any other explanation for why you were having him continue to amend your plans if you’re not going to enter into a contract with him?---Because we were house shopping. It was the same thing that we did with Morcrafts.  

So the situation with Morcraft was you got them to prepare plans for you?---Yep. 

You got them to a point that you liked?---Yep. 

And then you didn’t enter into a contract with them?---Yep. It’s, from what I see, standard practice in the building industry. 

What I’d suggest is you’ve got an existing relationship with Edge?---Yes. 

At the time before you go and see any of the other builders?---Yes. 

You go to Morcraft and get them to design some plans that you like; correct?--Yes. 

You go to Coast Life Homes to get them to design some plans that you like?---Yes.  

And then you get those plans from Coast Life Homes that you like and then you take them to Phil – Phillip at Edge?---Phillip? 

At Edge. Sorry, your contact at Edge?---Yes.  

Sorry, who is that?---Nigel. 

Nigel. You take them to Nigel at Edge?---Yep. 

And you show him the Coast Life plans?---Carry on. 

Do you accept that?---No. I tried – when I met with him, I actually tried – we tried to draw it – what we wanted. And then we emailed him the plan and asked him to change them.  

So when did you first meet with him to discuss the fact that he might be your builder?---I couldn’t recall that. 

Was it whilst you were still having these dealings with Mr Kay?---No.

I’d suggest that it was that you first made contact with Nigel while you were still dealing with Mr Kay. Do you accept that?---No. 

If I can please take you back to page 39. 

HIS HONOUR: This is in exhibit 1, yes. 

MR WHITE: Email to you from Mr Kay?---Yep. 

Saying: 

I’ve attached the updated price with inclusions.

?---Mmm. 

The next page of that exhibit, please. You’re aware of this email?---Yep. 

Continuing: 

Hi Russell, thanks for the updated the costs. Could you resend the estimate with individual prices on the sheet as we’d like to say how much it’s costing. Also with the price, does this include the patio on appearing.

It says that?---Yep. 

The next page. This is you and Fiona sending to Nigel a plan for the easement for your block?---Yep. 

So you accept that, at least by this stage, you had begun your dialogue with Nigel?-

--We’ve asked him to look at it, yes. 

Do you remember the meeting that preceded this email?---No. 

Well, was there a meeting that preceded this email?---I don’t know. It was five years ago; I can’t recall. 

Did – do you remember any dealings at all with Nigel, meetings or otherwise, before you sent this email?---I had – everything with Nigel was rather blasé. It was his – one of his – he was just starting out so it wasn’t a, “Come into my sales office,” type thing. It was go to someone’s house. So yeah. 

So do you remember if you went to his or he went to yours?---I went to his house. 

And what was discussed while you were there?---On what date? When? 

This - - -?---On our first meeting? Our first meeting was about building us our house.

And how long before this email was sent? Can you recall in a general sense?---I wouldn’t. 

Who else was at that meeting?---Pardon? 

Who else was with you at that meeting?---My wife. 

And what did you ask of Nigel at that meeting?---I just asked him if he could build me something similar to – on this – no, something similar to what I’d seen at Coast Life. A four bedroom house with - - - 

Can you just clarify that answer. Did you say if he could build you something similar to - - -?---No, I - - - 

So you didn’t have a document?---No.  

Okay. So you said, “Can you build me something similar to what I’ve seen in Coast Life”?---Yes. And I tried to draw it and I couldn’t draw it. 

Yes?---So he said, “Just email it to me.” And I - - -  

So I’m – could I just stop you there. So you said to him, “I’d like you to build me something that looks like this”?---Yes, and I was drawing it on a piece of paper. 

You tried to draw it and you had trouble?---Yep.  

So then you sent him through the plan?---Yep. 

So his instructions were, “Build me something that looks like this”?---And change it. 

Well, can you explain the change it part. When did that first get discussed?---That was when I gave him the plan, the copy of the plan. I asked him to change it. 

When? When did you give him a copy of the plan?---When I handed him the – when I – not handed, when I emailed him the copy. Me and my wife both said, “Can you change it. Can you put your own spin on it,” basically. 

Can you please go to page 53 of that bundle. Is that an email from you to Nigel?--At Nigel, regards Phil. Is - - - 

Did you send that email?---Yes. 

And then the next page. Was that plan an attachment to that email?---Yes. 

So there’s no reference there to, “Can you please change it or put your spin on it,” is there?---It was a verbal.

When do you say that was?---When – when we actually sent the plan. It was – I did ask him to change it. 

And why did you ask him to change it?---Because of obvious – obvious reasons. They can’t be identical. 

I see. So why can’t they be identical?---He actually suggested that we need to change it - - - 

Can I take you - - -?--- - - - for copyright reasons. 

Can I take you back to those plans that you’ve got in front of you there. The attachment?---Yep. 

If you have a look at that plan below the building footprint, the house footprint?---

Mmm. 

There’s a notation there: 

These plans are the property of Coast Life homes and are protected by copyright. No part may be used, reproduced or copied by any means or in any form without prior permission of Coast Life homes.

?---Yep. 

Have you read that?---Yep. 

What did you take that to mean when you read it?---Well, obviously, with the discussion of Nigel, we can’t duplicate the house. 

Yes?---So - - - 

So you knew – you knew that he couldn’t copy that?---We tried to rearrange it and he said, “I’ll just get my draftsman or architect or whatever you want to call it to - - -

So the purpose for you rearranging it was to avoid getting in trouble because of that notation?---Yes. 

That’s the only reason why you rearranged it?---Well, you can’t – to my belief, you couldn’t reproduce it, so. 

So is it fair to say that, in sending that plan through, you kind of knew that what you were doing wasn’t necessarily the right thing to do?---Not until it was actually brought up by the builder. When he said, “I can’t copy it, I’ve got to change it.” So 45 we tried to change it and we couldn’t figure a way to change it, so he said his architect or draftsman would change it.

So getting as close as you can to this whilst still being okay?---No, change it. So - - -”.[80]

  1. [52]
    For the plaintiff, there is particular criticism of the evidence of the second defendants as to their dealings with the first defendant.[81]  As the evidence extracted above indicates, each of them was initially guarded and defensive as to those dealings and Mrs Flaton, in particular, was not willing to be drawn as to particular interactions.  As the plaintiff points out there is in Exhibit 1, email communication occurring as early as 12 June 2015.  Whilst these issues are raised in respect of the dispute with Mr,Kay’s evidence in respect of the Morcraft Plan, the plaintiff does seek to engage the acknowledgement of the second defendants as to their provision of the Revision B Plan to the first defendant and whilst that fact of that occurrence is evidenced by the email at Exhibit 1, pp. 53-54, the only direct evidence as to the surrounding circumstances, as it has been set out above, is from each of the second defendants. 
  1. [53]
    For the second defendants, the submission correctly notes the issues as to whether they “authorised Edge to substantially reproduce the plans”.[82]  It is also correctly pointed out that in determination of the authorisation issue, the Court must take into account the matters set out in s 36(1A).  The contention that the Court would not relevantly find authorisation is premised upon a view of the evidence as to the evident trust of the second defendants in the advice provided by the first defendant, their less sophisticated position in respect of industry practice and understanding as to the Revision B Plan representing a collection of ideas, including their own as to a desired floor plan.[83]
  2. [54]
    The further submission for the second defendants that it should be found that they were not aware of any power they had to prevent the first defendant from substantially reproducing the Revision B Plan,[84] is neither to the point nor acceptable.  The clear fact is that the second defendants provided the plan for the very purpose of substantial reproduction and this question does not revolve around any mistake of law as to this being an infringement of the plaintiff’s copyright.  The question is as to whether and notwithstanding that the first defendant was engaged as the agent of the second defendants, the nature of that relationship and the reliance upon the assurances of the first defendants, means that there should be no finding of authorisation of the infringement, as a matter of fact.  Accordingly there is not, as the plaintiff contends, any tendency towards any unpleaded defence arising under s 115(3) of the Copyright Act.[85]
  1. [55]
    As to the plaintiff’s position, it is obviously content with the evidence in further explanation of the provision of the Revision B Plan, effectively if not unequivocally for the purpose of substantial reproduction of it and such as desired by the second defendants.  The only submissions made directly as to this evidence is that:

“… the assurances allegedly provided to the Flatons by Nigel from Edge Designer Homes should not be afforded any weight by the Court in its assessment as to whether the Flatons authorised Edge Designer Homes to reproduce the Plaintiff’s plans”.[86]

That approach may be seen as being consistent with the plaintiff’s approach in seeking additional damages having regard to s 115(4)(b) of the Copyright Act, as apparently reflected in its pleading of a case as the infringement of its copyright extending beyond objective considerations and extending to considerations of the state of mind of the second defendants in doing so.[87]

  1. [56]
    Notwithstanding what might be regarded as some evident reliance upon the first defendant and what they described as being represented to them, it is inescapable that the substantial reproduction of the Revision B Plan has occurred due to their direct provision of that plan to the first defendant for that very purpose.  As far as subjective considerations may be relevant to this issue, the plaintiff’s claim to copyright is evidently marked on the Revision B Plan and as Mr Flaton conceded, in terms of what the first defendant was to do in changing it, that was “[b]ecause of obvious reasons they can’t be identical”.  The substantial reproduction of the Revision B Plan is not just, in fact, what occurred but also what the second defendants desired and relevantly authorised. 

Assessment of damages

  1. [57]
    As earlier noted, apart from seeking compensatory damages in terms of the value of the loss of opportunity to profit from the construction of the second defendants’ house, the plaintiff also seeks additional damages pursuant to s 115(4) of the Copyright Act and there is the need to consider the effect of the settlement with the first defendant.  It is convenient to initially deal with the last identified issue.

The effect of the settlement with the first defendant

  1. [58]
    In considering the effect of the settlement with the first defendant it is of importance to understand that the evidence is that not only has there been separate determination by agreement of the parties of the plaintiff’s claim against the first defendant but also that the plaintiff has recovered the amount of $30,000.00.[88]
  2. [59]
    As the second defendants contend, the appropriate principle is in avoidance of duplication of damages, as discussed in Carlisle County Homes Pty Ltd v Brown and Residential Developments Mackay Pty Ltd.[89]  Although there is nothing additionally known as to the effect of the settlement in terms of representing the recovery of damages by the plaintiff, or for instance the prospect that it was commercially driven (having regard to the costs incurred, although it was fairly early in the history of the claim,[90] and likely to be incurred in defending the matter to trial), the plaintiff concedes that $30,000.00 should be deducted from its claim for $40,000.00 in compensatory damages.

Compensatory Damages

  1. [60]
    The plaintiff seeks such compensatory damages upon the basis of the loss of opportunity to profit from engagement to build the second defendants’ house, substantially in accordance with its Revision B Plan.  That is, in seeking the adoption of the approach taken in Henley Arch.[91]
  2. [61]
    Similarly to the situation in Henley Arch,[92] and as is clear on the evidence in this case, the plaintiff does not and would not prepare plans for a fee, nor licence the use of its plans.[93]  Accordingly, the plaintiff does not seek what was observed, in Vanwake Investments Pty Ltd v New-Stat Nominees Pty Ltd and Ors,[94] to be a commonly adopted approach of assessment of damages upon the basis of “a fair fee for the use of the plans the subject of the infringement”. 
  3. [62]
    Accordingly, in this case, the plaintiff undertook to only prove its loss of commercial opportunity of building the house for the second defendants.  That is, in proving that had it not been for the infringement of its copyright, the second defendants would have selected the plaintiff to build their house and it would have done so and earned a profit.  As described in Henley Arch,[95] there are two questions.  First as to whether there has been any such lost opportunity.  That is in proof, on the balance of probabilities of causation of some loss.  Secondly, as to the valuation of that lost opportunity, assessed by reference to the degree of probabilities and possibilities involved.[96]
  4. [63]
    As to the first question, there are various submissions made as to aspects of the relevant evidence, including that as to the subjectively held views of the second defendants (including an aspect of disputed evidence as between Mr Kay and the second defendants, as to whether he took any telephone call during one of their meetings).[97]
  5. [64]
    The appropriate conclusion, on the evidence, is that it is more likely than not that, absent the infringement of copyright, the second defendants would not have contracted for the plaintiff to build their house.  Two things should be observed at the outset.  First this enquiry is necessarily to be undertaken upon the basis of what the second defendants were more likely to have done absent the infringement. However, it is necessary to also understand that short of reproduction, in the sense of substantial copying of the particular expression of ideas in the Revision B Plan, the second defendants were not precluded from seeking another particular expression of similar ideas from another builder.  Secondly and whilst there may appear to be some tension in the evidence as to their ongoing engagement with Mr Kay, despite the identification, from the outset, of some particular issues,[98] it is necessary to understand that the relative importance of particular issues may have varied as between each of the second defendants and that, at the end of the day, it would be their joint decision as to how to proceed.  Moreover, this is not an approach or assessment which is premised upon any advantage being taken of the information provided by Mr Kay, which he described as generous and as a matter of good will, despite an understanding that people will generally be inquisitive as to what they will be getting, whether or not they move forward to a contract.[99]
  6. [65]
    As tends to be supported by the evidence generally as to the second defendants’ interaction with other builders, as well as the plaintiff, it may be accepted, as Mrs Flaton, more particularly described, that their approach was cautious and discerning, particularly in the context of an earlier experience in building their first home.[100]
  7. [66]
    In this context, it is unnecessary to examine all of the issues relating to their decision to move from the plaintiff to the first defendant, as were traversed in the evidence and submissions, or to resolve the evidential dispute as to whether Mr Kay took a phone call during a meeting with the second defendants.  It suffices to particularly note that:
    1. (a)
      despite the evidence as to the first defendant being a relatively fledgling enterprise,[101] there was the potentially influential factor of the familial connection of Mr Flaton’s brother, an electrician, who they desired do the electrical work for their house;[102] and
    2. (b)
      the first defendants’ contract obviated at least two particularly identified obstacles to a contract with the plaintiff:[103]
      1. first, in preparedness to exclude the electrical work for performance by Mr Flaton’s brother.[104] Each of the second defendants gave evidence that this was their intention.[105] And it was the connection of Mr Flaton’s brother which led them to the first defendant.  Although for the plaintiff there is reliance upon what ultimately appears to be a concession that this was not a factor in deciding not to contract with the plaintiffs,[106] it is not an entirely clear concession as to the point now in issue, as opposed to what was demonstrated as to her lack of recall as to how any such issue was raised with Mr Kay in the immediately preceding passage.[107] In any event, there was no such equivocation by Mr Flaton.[108]
      2. secondly, as to the use of a traditional slab, rather than, as was an inherent feature for the plaintiff,[109] the use of a “waffle pod slab”. Mr Flaton’s evidence was that he was aware from the first meeting with Mr Kay that a traditional slab was not an option.[110] Although,

when pressed as to why they continued interacting with the plaintiff when this difficulty was apparent from the outset, he conceded that he “could have been swayed”,[111] each of the second defendants described earlier experience of major cracking in a waffle pod slab and therefore preference for a traditional slab.[112] 

  1. [67]
    Accordingly and even in the absence of an ability to substantially reproduce the Revision B Plan upon their approach to the first defendant, the appropriate conclusion is that there was no likelihood that the second defendants would have contracted with the plaintiff and therefore there is an absence of proof of causation of any damage in the nature of lost commercial opportunity to build the second defendants’ house.
  2. [68]
    However, it remains appropriate to consider the alternative considerations as to the plaintiff’s case in valuation of any such lost opportunity. 
  3. [69]
    The plaintiff’s methodology was particularly reflected in the evidence of Mr McDonald.  As noted for the plaintiff, his evidence, as it was largely unchallenged in cross-examination, was effectively to:
    1. (a)
      support that had the second defendants proceeded to contract with the plaintiff, the contract price would not have been less than $210,437.00;[113] and
    2. (b)
      provide a “job profit report” for a commensurate period,[114] to reflect, in the context of the plaintiff’s aspiration of achieving a 25% profit on each build,[115] an average return on the projects undertaken in the commensurate period of 21.4%.[116]

The plaintiff then contends that by application of that average percentage to the figure of $210,437.00, the likely profit for the second defendants’ build would be $45,033.52.  But and acting conservatively and consistently with the claim and its pleading, the plaintiff seeks $40,000 pursuant to s 115(2) of the Copyright Act.[117]

  1. [70]
    Whilst it may be noted that the second defendants raise a number of contentions as to aspects of potential unreliability of the reliance upon the likely contract figure for the second defendants’ house and the contended comparable builds,[118] including the absence of evidence as to the contracts relating to those comparable builds, it is unnecessary for present purposes to descend to those considerations.  This is because, as has been noted, the plaintiff seeks to adopt the approach taken in Henley Arch, which in application of appropriate principle in valuation of a lost opportunity, proceeded upon considerations of first making reduction or discount to allow for contingencies or uncertainties and secondly, upon an assessment as to the degree of likelihood of the lost opportunity.
  2. [71]
    In this case and even if it were to be considered that the plaintiff’s calculation of the amount of $45,033.52 was appropriately supported by the evidence and that the limitation of the claim to $40,000.00 was sufficient to allow for contingencies and uncertainties, in order for there to be any recovery against the second defendants (having regard to the accepted necessity to deduct $30,000.00), there would need to be an assessment of greater than 75% likelihood of the lost opportunity.  The evidence simply does not support such a prospect. Indeed and if there had not been a finding of absence of any such prospect, such likelihood would perhaps be assessed at no more than 50%. 
  3. [72]
    Accordingly, there will be no award of damages upon the premise of lost commercial opportunity.  However, the problem remains as to how to then assess any damage suffered by the plaintiff due to the infringement of its copyright in the Revision B Plan.
  4. [73]
    As is emphasised for the plaintiff, the evidence is that the plaintiff had never and would never give licence to another for use of its plans.[119] Neither was any evidence led to support any estimation as to the value or cost of the preparation of the Revision B Plan by the plaintiff.  There is therefore nothing to support the contention put forward for the second defendants, of a value in the vicinity of $500.[120]
  5. [74]
    An appropriate approach in such circumstances is, as identified in Carlisle Country Homes,[121] to allow an amount at least by way of nominal damages and more particularly by way of vindication of the plaintiff’s title to its property by way of copyright.  Like the position determined in Carlisle County Homes, the second defendants are to be believed in their evidence as to acting on the representations of the first defendant and without actual belief that they were infringing the plaintiff’s copyright.  And the settlement achieved with the first defendant has already served as substantial and adequate vindication of the plaintiff’s proprietary rights, which may be supplemented by an award of nominal damages against the second defendants.  In the circumstances that would appropriately be, as otherwise suggested for them,[122] in the amount of $500.

Additional damages: s 115(4) of the Copyright Act

  1. [75]
    As is correctly noted for the second defendants, any award of additional damages pursuant to s 115(4) is not in any sense of compensation for proven loss.[123]  It is a remedy which is specifically addressed at a determination that is it is proper to make such an award having regard to specified criteria.  Section 115(4) provides:

“(4) Where, in an action under this section:

  1. (a)
    an infringement of copyright is established; and
  2. (b)
    the court is satisfied that it is proper to do so, having regard to:
    1. the flagrancy of the infringement; and

(ia)  the need to deter similar infringements of copyright;

(ib)  the conduct of the  defendant after the act constituting the infringement or, if relevant, after the defendant was informed that the defendant had allegedly infringed the plaintiff’s copyright; and

  1. (ii)
    whether the infringement involved the conversion of a work or other subject-matter from hardcopy or analog from into a digital or other electronic machine-readable form; and
  2. (iii)
    any benefit shown to have accrued to the defendant by reason of the infringement; and
  3. (iv)
    all other relevant consideration.

the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances”.

In Henley Arch Pty Ltd v Lucky Homes Pty Ltd,[124] and in reference to earlier authorities, some broader principles are noted:

“[242]  First, principles governing awards of aggravated damages and exemplary damages at common law may inform the question as to whether additional damages should be awarded. It will be recalled that aggravated damages are more connected to a compensatory function where the harm done to an aggrieved person was aggravated by the wrongful act. Contrastingly, exemplary damages have a punitive function which acts as a specific deterrent and a general deterrent. One can appreciate that the s 115(4)(b) factors reflect some of these concepts. But having said this, it is accepted that additional damages, in one sense, can be described as sui generis. It is not limited by such common law categories. Moreover, some such common law categories may be inapposite when one is dealing with a corporate applicant (cf Luxottica Retail Australia Pty Ltd v Grant (2009) 81 IPR 26 ; [2009] NSWSC 126 at [39] per White J).

[243] Second, the factors set out in s 115(4)(b) are matters that must be taken into account. But none of them are pre-conditions to the exercise of power. Accordingly, even if there has been no flagrant infringement, additional damages may still be awarded. But if there has been flagrant infringement, an award of additional damages may more readily be justified”.

However, it may be observed that the reference to none of the specified matters being a pre-condition to an exercise of power should perhaps be seen as limited to the individually specified matter in each of s 115(4)(b)(i) to (iii), as it is difficult to comprehend how such an exercise of power could occur in the absence of identification of some “other relevant matters” as a basis for an award and as contemplated by s 115(4)(b)(iv).

  1. [76]
    The matters pleaded here in the Statement of Claim,[125] and addressed in submissions,[126] may be seen to be particularly directed at contentions as to flagrancy and need for deterrence of similar infringement of copyright.  That is, more in terms of seeking redress in form of punitive rather than aggravated damages. The latter may be more readily seen in the sense of the aggravation of the infringement reflected in the considerations such as are expressed in s 115(4)(b)(ib), (ii) and (iii). 
  1. [77]
    As to flagrancy, in Henley Arch this concept was said to mean more than copying and mere mistakes or carelessness and that it “connotes reprehensible conduct or scandalous conduct which may be demonstrated by deliberate and calculated acts of infringement”. However, it is also noted that “it is not necessary to demonstrate a consciousness of copyright infringement” and that “[a] consciousness of wrongdoing may be sufficient”.[127]
  1. [78]
    Based on the contention as to appropriateness of an award of $10,000.00 compensatory damages (after deduction of the $30,000.00), the plaintiff contends for an award of additional damages in the same sum: $10,000.00.  In this respect, there is effective embracement of the evidence of the Flatons as to their discussions with the first defendant and being told of only a need to modify the plans by 10%, when the reality is that they desired a home built in accordance with the Revision B Plan, and without any attempt to obtain any permission or licence to do so.
  2. [79]
    Although Mr Flaton did concede an understanding that the house could not be duplicated in accordance with the Revision B Plan and thereby an acceptance of the suggestion that the one reason for modification or rearrangement was in order to avoid getting into trouble”,[128] Mrs Flaton (who it may be noted, on the evidence, was much more engaged with Mr Kay in developing the specifics of the Revision B Plan) made it clear that her concern was in shopping around to get the best deal for the house that they wanted.[129] One way in which the Edge Developments Homes Plan differed from the Revision B plan, is in the adoption of the layout of appliances in the Kitchen, as demonstrated to Mr Kay by Mrs Flaton sending him a copy of the extract of her earlier kitchen plan and the evidence demonstrates that the Edge Designer Homes Plan from which the second defendants’ house was built was also the subject of ongoing modifications and adjustments before finalisation.[130]
  1. [80]
    Particularly in the context of the findings made in respect of any loss of opportunity for the plaintiff to build the house, the evidence in this case did not impress as being supportive of the contentions for the plaintiff that it should be found that the second defendants had such a sense of knowledge that they were acting wrongly and taking any unfair advantage of the work of the plaintiff as represented in the Revision B Plan, so as to provide any foundation for an award of additional damages on the basis of flagrancy of their infringement of the plaintiff’s copyright.
  2. [81]
    Further and also in respect of any broader consideration of such an award it is important to understand that:
    1. (a)
      the infringement here is in respect of the particular representation of a collection of ideas in the sense of a layout plan, because although as Mr Van Slyke explained there was more in terms of the representation of his time and effort on behalf of the plaintiff sitting behind this layout plan, what was provided to the second defendants and substantially reproduced was the conceptual layout or rudimentary floorplan; and
    2. (b)
      although, as has been explained, not relevantly detracting from a finding of authorisation of the reproduction, there was an obvious sense of reliance upon the representations of the first defendant as to how a reproduction could legitimately be achieved by them.
  3. [82]
    As was noted for the second defendants, it is more generally accepted that an award of exemplary or punitive damages is in punishment of ‘conscious wrongdoing in contumelious disregard of another’s rights’.[131]
  4. [83]
    In these circumstances and whilst the situation may well have been different in respect of the first defendant, it is not appropriate to award any additional damages against the second defendants by way seeking deterrence of similar infringements, or otherwise pursuant to s 115(4) of the Copyright Act.

Conclusion

  1. [84]
    The conclusion is that upon the findings that there has been infringement of the plaintiff’s copyright in the Revision B Plan, by the second defendants’ authorisation of the reproduction of that plan by the first defendant and construction of a house in accordance with that reproduced plan on the second defendants’ land, there will be an award of the amount of $500.00 to the plaintiff, as damages pursuant to s 115(2) of the Copyright Act. 
  2. [85]
    Otherwise, the parties will be given an opportunity to be heard as to the form of final orders, including as to interest and costs.

APPENDIX A

Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton [2022] QDC 116

APPENDIX B

Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton [2022] QDC 116

APPENDIX C

Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton [2022] QDC 116

Footnotes

[1]In their defence, the second defendants raised an issue as to the jurisdiction of this Court to hear this proceeding. However, not only was this objection not pursued in accordance with UCPR 144, it was not persisted in at trial, save in respect of the reservation of a position to be taken as to any grant of injunctive relief to the plaintiff: T1-7.35-1-8.21. As observed in Vanwake Investments Pty Ltd v New- State Nominees Pty Ltd & Ors [2005] QDC 57 at [3] – [4], at least as far as encompassing the power to award damages is concerned, s 39(2) of the Judiciary Act 1903 (Cth) confers such jurisdiction upon this Court (subject to the limits of its jurisdiction pursuant to the District Court of Queensland Act 1967 (Qld).

[2]See the Statement of Claim, filed 29/6/17 at [35] and the Further Amended Defence of the Second Defendants filed 13/9/2019 at [24A] and [24B].

[3]Such copyright generally subsists for a period of 70 years after the calendar year in which the author of the work dies.

[4]T1-73.15-22.

[5]T1-73.27, 1-76.20.

[6]T1-76.22 – 1-79.21 and Ex. 2, docs.7-9.

[7]See: Ex. 2, p. 11.

[8]T1-42.8-40.

[9]T1-10.25 – 3-12.1.

[10][2004] FCAFC 78, at [38]-[39] per Wilcox and Lindgren JJ.

[11]Ibid at [41]-[42].

[12][2005] QDC 57, at [44] per McGill DCJ

[13](1998) AIPC 90-488 at 38, 239. See also: A-One Accessory Imports Pty Ltd v Off Road Imports Pty Ltd (1996) 65 FCR 478 at 487-490.

[14]IceTV Pty Ltd v Nine Network Australia Pty Ltd (2009) 239 CLR 458 at [33].

[15]Ibid at [45]-[48] and [99].

[16]T2-38.44 – 2-39.4, Ex 1, p 10.

[17]T2-39.5-18.

[18]T2-39.39-41.

[19]T2-37.30 – 2-38.37.

[20]T2-38.11-18.

[21]T2-102.8-32.

[22]See also: T2-110.46-2-111.3.

[23]T1-57.23-24.

[24]T1-59.1-8.

[25]T1-54.40 – 1-55.7.

[26]T2-54.3 – 25.

[27]See Ex. 1 at pp. 7 – 10.

[28]T1-57.45 – 1-58.45.

[29]Compare Ex. 2 p. 8 with Ex. 2 p. 2 and Ex. 1 p. 10.

[30]T1-51.8–36 and T1-59.13 - 1-60.19.

[31]T2-39.1-7 and T2-39.33-45, in respect of Mrs Flaton’s evidence and T2-102.8-32, in respect of Mr Flaton’s evidence.

[32]Ownit Homes Pty Ltd & Ors v D&F Mancuso Investments Pty Ltd (1988) AIPC 90-488 at 38-238.

[33]T1-106.15-17.

[34]T1-106.25 – 1-107.26 and Ex. 2 p. 12.

[35]T1-107.40 – T1-109.35 and Ex. 2 pp. 15-101.

[36]T1-77.35.

[37]T1-77.33-46.

[38]T1-92.20-28.

[39]T1-91.22-32.

[40]T1-96.15-44.

[41]T1-79.31-42.

[42]Ex. 1, pp. 34-37.

[43]T 1-90.24-29.

[44][1985] 159 CLR 466 at 472, per Gibbs CJ (Mason and Brennan JJ agreeing).

[45]Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 419 at [98].

[46](1988) AIPC 90-488 at 38, 240.

[47][1971] 2 NSWLR 278 at 289; see: ibid at pp 38, 240 – 38, 241.

[48]See (1988) AIPC 90-488 at 38, 241.

[49]Ex. 1 pp. 53-54.

[50]T2-83.17-28.

[51]T2-84.38 – T2-85.13.

[52]T2-91.22 – T2-92.13.

[53]T2-92.24-29.

[54]T2-117.37 – T2-119.47.

[55]Henley Arch Pty Ltd v Luckey Homes Pty Ltd [2016] FCA 1217 at [158]-[164], per Beach J.

[56]Ibid at [175].

[57]Van Wake Investments Pty Ltd v New-Stat Nominees Pty Ltd & Ors [2005] QDC 57, at 55 per McGill DCJ.

[58]These as they appear respectively at Ex.1, p. 159 and Ex.2, p. 10 and also the Morcraft Plan, to which reference has been made, as that appears at Ex.1, p. 10, are copied respectively, as appendices A, B and C to these reasons.

[59]T1-81.29-1-84.23.

[60]Ibid and T1-86.46-1-89.38.

[61]Second defendants’ written submissions, filed 12/10/20, at [27(b)].

[62]See para [21], above.

[63]Ex 2, p 11.

[64]As largely conceded by Mr Kay (T1-69.32-24) and Mr Van Slyke (T1-95.33-1-96.29).

[65]T2-82.1-2.

[66]Second defendants’ written submissions, filed 12/10/20, at [29]. The submissions extend to contending for an inference pursuant to the reasoning expounded in Jones v Dunkel [1959] 101 CLR 298 at 312.

[67]See also the second defendants’ written reply, filed 8/12/20.

[68]See the Statement of Claim, filed 29/6/17, at [20] – [24] and the Plaintiff’s written submissions filed 2/11/20, at [96]-[102].

[69](2012) 248 CLR 42.

[70]Ibid at [9].

[71]Ibid at [42]-[50].

[72]Ibid at [51]-[52].

[73](1975) 133 CLR 1 at 12-13.

[74]Plaintiff’s written submissions filed 2/11/20 at [97].

[75]Perhaps understandably when it is noted that the pleaded response to the plaintiffs allegations of infringement of copyright is redolent of reliance upon the absence of any subsistence of the plaintiffs claimed copyright in the Revision B Plan: see the further and amended defence, filed 13/9/19 at [17] – [23].

[76]T2-46.25-34.

[77]T2-84.41-42.

[78]T2-91.35 – T2-92.13.

[79]T2-105.3-44.

[80]T2-115.40 – T2.120.1.

[81]Plaintiff’s written submissions, filed 2/11/20, at [59(d) – (i)].

[82]Second defendants’ written submissions, filed 12/10/20, at [32].

[83]Ibid at [36].

[84]Ibid at [36].

[85]Plaintiff’s written submissions, filed 2/11/20, at [99] – [101].

[86]Ibid at [102].

[87]Statement of Claim, filed 29/6/17, at [32] and [34].

[88]T1-12.34-43.

[89][1999] QDC 284 at pp. 23 – 31 and more particularly at pp. 29 – 31, per McGill DCJ.

[90]Notice of Discontinuance, filed 8/5/18.

[91][2016] FCA 1217 at [208] – [239].

[92]Ibid at [208]

[93]T1-49.40-43 and T1-67.16-17.

[94][2005] QDC 57 at [92]. See also, the discussion in Carlisle County Homes Pty Ltd v Brown & Residential Developments Mackay Pty Ltd [1999] QDC 284 at 19 – 22.

[95][2016] FCA 1217 at [213].

[96]See also: Sellars v Adelaide Petroleum N.L. (1994) 179 CLR 332 at 355.

[97]Second defendants written submissions, filed 12/10/20, at [39] – [45], plaintiffs written submissions, filed 12/11/20, at [117] – [121].

[98]Although, it is also to be noted that in the later phase and even prior to the first identified email exchange with the first defendant (see Ex. 1, p. 41), that is, in essence, Mr. Kay pursuing the second defendants. As he described, there came a point when they stopped communicating with him: T1- 64.19-23.

[99]T1-64.28 – 1-65.6.

[100]T2-35.18-2-36.9 and 2-37.4-11.

[101]T2-82.1-4

[102]T2-94.1-16

[103]T2-46.26-38, 2-105.30-2-106.1 and Ex. 1 at pp. 107, 108, 136, 137, 146 and 186 – 194.

[104]T2-47.1-4 and T2-79.42-43. Although Mr Kay did not specifically recall an exclusion of electrical work being raised, he observed that it may have been brought up and did indicate that it would not be an option for them: T1-61.40-46.

[105]T2-36.23-26 and T2-102.39-103.5.

[106]T2-59.20.

[107]T2-58.28 – 2-59.19.

[108]T2-101.41-42, 2-102.39-2-103.5, 2-110.22-28, 2-114.42-45 and 2-121.10-18.

[109]T2-44.30-36, 2-46.15-19 and notwithstanding some concession by Mrs. Flaton that this had not been expressly raised with Mr. Kay: T2-80.19-38 and 2-88.15-16.

[110]T2-102.34-37 and 115.1-8, noting that the questioning of Mr. Flaton does not reflect either this earlier evidence or that of Mr. Kay, which was that he did not recollect Mr. Flaton being at the first meeting. This is more likely to be a product of imperfect recollection of past events, in the context of dealing mainly with Mrs Flaton and Mr Flaton role in also minding their children: T2-109.15-26.

[111]T2-120.45-46.

[112]T2-36.29-33, T2-80.22-23 and T2-101.44-46.

[113]As calculated in the Sales Estimate Sheet provided to the second defendants: T2-76.1, T2-79.21-22 and T2-114.8-9 and Ex. 2 pp. 12 – 14.

[114]1 July 2015 to 31 December 2016

[115]T2-7.35-40.

[116]Ex. 2, p. 102.

[117]Plaintiffs written submissions, filed 2/11/20, at [112].

[118]Second defendants’ written submissions, filed 12/10/20, at [49] – [54].

[119]T1-49.40-43 and T1-67.16-17.

[120]See: plaintiffs written submissions, filed 2/11/20, at [115] and second defendants written submissions filed 12/10/20 at [56].

[121](1999) QDC 284 at 31.

[122]Albeit on a different basis.

[123]Second defendants’ written submissions, filed 12/10/20, at [59].

[124][2016] FCA 1217 at [241] – [243].

[125]Statement of Claim, filed 29/6/17, at [37].

[126]Plaintiff’s written submissions, filed 2/11/20, at [122] – [132].

[127][2016] FCA 1217 at [244], with citation of Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd (No 3) (2014) 312 ALR 705 at [47] and Futuretronics.com.au Pty Ltd v Graphix Labels Pty Ltd (No 2) (2008) 76 IPR 763 at [20].

[128]T2-119.28-41.

[129]T2-85.12 and T2-95.16-35.

[130]See: Ex. 1 pp. 66-95.

[131]See: second defendants’ written submissions, filed 12/10/20, at [64] and Whitfield v De Lauret & Co Ltd (1920) 29 CLR 71 and XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448. See also: Autodesk Inc v Yee (1996) 68 FCR 391 at 394.

Close

Editorial Notes

  • Published Case Name:

    Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton

  • Shortened Case Name:

    Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton

  • MNC:

    [2022] QDC 116

  • Court:

    QDC

  • Judge(s):

    Long SC, DCJ

  • Date:

    20 May 2022

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
A-One Accessory Imports Pty Ltd v Off Road Imports Pty Ltd (1996) 65 FCR 478
1 citation
Jump To
Cite 1 - (1996) 65 FCR 478
amawood Ltd v Henley Arch Pty Ltd (2004) 61 IPR 378
1 citation
Jump To
Cite 1 - (2004) 61 IPR 378
Autodesk Inc v Yee (1996) 68 FCR 391
1 citation
Jump To
Cite 1 - (1996) 68 FCR 391
Beazley Homes Ltd v Arrowsmith (1978) 1 NZLR 394
1 citation
Jump To
Cite 1 - (1978) 1 NZLR 394
Carlisle County Homes Pty Ltd v Brown [1999] QDC 284
4 citations
Jump To
Cite 1 - [1999] QDC 284
Cite 2 - [1999] QDC 284
Cite 3 - [1999] QDC 284
Cite 4 - [1999] QDC 284
Clarendon Homes (Aust) Pty Ltd v Henley Arch Pty Ltd (1999) 46 IPR 309
1 citation
Jump To
Cite 1 - (1999) 46 IPR 309
Clarendon Homes (Aust) Pty Ltd v Henley Arch Pty Ltd [1999] FCA 1371
1 citation
Jump To
Cite 1 - [1999] FCA 1371
Dixon Investments Pty Ltd v Hall (1990) 18 IPR 481
1 citation
Jump To
Cite 1 - (1990) 18 IPR 481
Dynamic Supplies Pty Ltd v Tonnex International Pty Ltd (No 3) (2014) 312 ALR 705
1 citation
Jump To
Cite 1 - (2014) 312 ALR 705
Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 419
2 citations
Jump To
Cite 1 - (1999) 87 FCR 419
Cite 2 - (1999) 87 FCR 419
Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415
1 citation
Jump To
Cite 1 - (1999) 87 FCR 415
Francis Day & Hunter Ltd v Bron [1963] Ch 587
1 citation
Jump To
Cite 1 - [1963] Ch 587
Futuretronics.com.au Pty Ltd v Graphix Labels Pty Ltd (No 2) (2008) 76 IPR 763
1 citation
Jump To
Cite 1 - (2008) 76 IPR 763
G. A. Cramp & Sons, Ld v Frank Smythson, Ld [1944] AC 329
1 citation
Jump To
Cite 1 - [1944] AC 329
Henley Arch Pty Ltd v Luckey Homes Pty Ltd [2016] FCA 1217
8 citations
Jump To
Cite 1 - [2016] FCA 1217
Cite 2 - [2016] FCA 1217
Cite 3 - [2016] FCA 1217
Cite 4 - [2016] FCA 1217
Cite 5 - [2016] FCA 1217
Cite 6 - [2016] FCA 1217
Cite 7 - [2016] FCA 1217
Cite 8 - [2016] FCA 1217
Homes Pty Ltd v D & F Mancuso Investments Pty Ltd (1988) AIPC 90-488
3 citations
Jump To
Cite 1 - (1988) AIPC 90-488
Cite 2 - (1988) AIPC 90-488
Cite 3 - (1988) AIPC 90-488
IceTV Pty Ltd v Nine Network Australia Pty Ltd (2009) 239 CLR 458
4 citations
Jump To
Cite 1 - (2009) 239 CLR 458
Cite 2 - (2009) 239 CLR 458
Cite 3 - (2009) 239 CLR 458
Cite 4 - (2009) 239 CLR 458
Jones v Dunkel (1959) 101 CLR 298
1 citation
Jump To
Cite 1 - (1959) 101 CLR 298
Kenrick & Co. v Lawrence & Co. (1890) 25 QBD 99
1 citation
Jump To
Cite 1 - (1890) 25 QBD 99
Ladbroke (Football) Ltd v William Hill (Football) Ltd (1964) 1 WLR 273
1 citation
Jump To
Cite 1 - (1964) 1 WLR 273
Luxottica Retail Australia Pty Ltd v Grant (2009) 81 IPR 26
1 citation
Jump To
Cite 1 - (2009) 81 IPR 26
Luxottica Retail Australia Pty Ltd v Grant [2009] NSWSC 126
1 citation
Jump To
Cite 1 - [2009] NSWSC 126
Murry & Woolley Pty Ltd v Hooker Homes Pty Ltd (1971) 2 NSWLR 278
2 citations
Jump To
Cite 1 - (1971) 2 NSWLR 278
Cite 2 - (1971) 2 NSWLR 278
Ownit Homes Pty Ltd & Ors v D&F Mancuso Investments Pty Ltd (1998) AIPC 9 -488
1 citation
Jump To
Cite 1 - (1998) AIPC 9 -488
Re Riv-Oland Marble Company (Vic) Pty Ltd v Settef SpA [1988] AIPC 90
2 citations
Jump To
Cite 1 - [1988] AIPC 90
Cite 2 - [1988] AIPC 90
Roadshow Films Pty Ltd v iiNet Ltd [No 2] (2012) 248 CLR 42
5 citations
Jump To
Cite 1 - (2012) 248 CLR 42
Cite 2 - (2012) 248 CLR 42
Cite 3 - (2012) 248 CLR 42
Cite 4 - (2012) 248 CLR 42
Cite 5 - (2012) 248 CLR 42
Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd (2012) 95 IPR 64
1 citation
Jump To
Cite 1 - (2012) 95 IPR 64
Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd [2012] FCAFC 4
1 citation
Jump To
Cite 1 - [2012] FCAFC 4
Sellars v Adelaide Petroleum NL (1994) 179 CLR 332
2 citations
Jump To
Cite 1 - (1994) 179 CLR 332
Cite 2 - (1994) 179 CLR 332
SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466
3 citations
Jump To
Cite 1 - (1985) 159 CLR 466
Cite 2 - (1985) 159 CLR 466
Cite 3 - (1985) 159 CLR 466
Tamawood Ltd v Habitare Developments Pty Ltd (2015) 112 IPR 439
1 citation
Jump To
Cite 1 - (2015) 112 IPR 439
Tamawood Ltd v Habitare Developments Pty Ltd [2015] FCAFC 65
1 citation
Jump To
Cite 1 - [2015] FCAFC 65
Tamawood Ltd v Henley Arch Pty Ltd [2004] FCAFC 78
4 citations
Jump To
Cite 1 - [2004] FCAFC 78
Cite 2 - [2004] FCAFC 78
Cite 3 - [2004] FCAFC 78
Cite 4 - [2004] FCAFC 78
University of New South Wales v Moorhouse (1975) 133 CLR 1
2 citations
Jump To
Cite 1 - (1975) 133 CLR 1
Cite 2 - (1975) 133 CLR 1
Vanwake Investments Pty Ltd v New-Stat Nominees Pty Ltd [2005] QDC 57
5 citations
Jump To
Cite 1 - [2005] QDC 57
Cite 2 - [2005] QDC 57
Cite 3 - [2005] QDC 57
Cite 4 - [2005] QDC 57
Cite 5 - [2005] QDC 57
Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479
1 citation
Jump To
Cite 1 - (1937) 58 CLR 479
Whitfield v De Lauret & Co Ltd (1920) 29 CLR 71
1 citation
Jump To
Cite 1 - (1920) 29 CLR 71
XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd (1985) 155 CLR 448
1 citation
Jump To
Cite 1 - (1985) 155 CLR 448

Cases Citing

Case NameFull CitationFrequency
Look Design and Development Pty Ltd v Edge Developments Pty Ltd & Flaton (No. 2) [2022] QDC 2082 citations
1

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