Generally, copyright in the drawings is owned by the person or practice who prepared the original drawings and the client has a licence to use the drawings for construction of the dwelling or building. The ownership of the copyright in the drawings, and the scope of the licence, are generally determined by the contractual agreement between the client and the architect.
The issue of copyright infringement takes on different forms. Difficulties arise when the client terminates the services of practice A and appoints a new practice B to complete or revise these drawings. We are aware of claims being issued by practice A against practice B for copyright infringements despite revisions and changes being made to the original design drawings by practice B. In some instances, these claims are complicated by the fact that practice A’s fees remain unpaid by the client and the client does not have a licence to use the original drawings.
Normally a measure of damages is an account of profits which in the above case, is the profit that practice B gained by using the original drawings.
However in the Western Australian Supreme Court decision (Milankov Designs & Project Management Pty Ltd v Di Latte  WASC 14) the Court confirmed that damages for copyright infringement is referrable to “such damages as would as far as possible put the Plaintiff in the position it would have been in if there had been no infringement” (TS & B Retail Systems Pty Ltd v 3 Fold Resources Pty Ltd (No3) (2007) 158 FCR 444 ).
In the Milankov case, the Plaintiff’s scope of works was described as Stage 1 being the design and sketch plan documentation and Stage 2 being the working drawings and specification documentation. The client terminated the Plaintiff’s services at the conclusion of Stage 1 and appointed another practice to complete Stage 2. The Plaintiff alleged that the client and the new architectural practice infringed copyright. The Court found in favour of the Plaintiff and determined that both the client and the architect had infringed the Plaintiff’s copyright.
The Court assessed the account of profits as the Plaintiff’s loss of profit (ie. fees) it would have earned on Stage 2 of works it did not complete, as a result of termination of its services. In this instance, the Court assessed the damages at approximately $157,000.
Copyright infringement claims are expensive to defend and as demonstrated in the above case, can result in significant damages. Care should therefore be taken when using drawings prepared by other practices.
Claims Manager- Focus Underwriting