Copyright in building plans after termination of building contract

• Published date: 17 August 2022
• Subject Matter: Intellectual Property, Real Estate and Construction, Copyright, Construction & Planning
• Law Firm: Stonegate Legal
• Author: Mr Wayne Davis

What happens to the copyright in building plans after termination of the residential building contract?

A question that we get asked a lot is if an owner can use the building plans after termination of the residential building contract.

In most building contracts, the copyright remains with the builder or building company after termination. A building contract will usually have a clause which says something like:

Where the builder creates the plans, the owner agrees that the builder retains copyright in those plans. The builder may grant a licence to the owner to use those plans.

We see less reputable builders saying things like "we retain copyright" or "you are not allowed to use our plans", or words to that effect. But this may not be true.

So, what does copyright mean, and does a license to use those plans exist after termination of the residential building contract?

Stonegate Legal were involved in a matter like this - DSGN Kartell Pty Ltd v Pathmaperuma; DSGN Kartell Pty Ltd v Hennig Bros Construction Pty Ltd; DSGN Kartell Pty Ltd v Craig Russell Stranger [2020] QCAT 211 where we acted for owners in a failed claim by DSGN Kartell Pty Ltd to claim copyright infringement in QCAT's building and construction jurisdiction.

In this article our building and construction lawyers explain copyright, and the case law around licensing and the use of building plans.

What is Copyright?

This article is not really about copyright per se, but a brief definition may be required to put the rest of the article into context.

Very simply put, copyright is a collection of legal rights that a person has over artistic or creative works such as computer programs, books, films, music, sound recordings, text, and of course building & architectural plans.

The main right which subsists in copyright is the "right" to controls who can "copy" or reproduce their artistic works, who can use the copyrighted material.

Copyright protection in Australia is automatic and exists as soon as the works are created (written down, recorded, etc). There is no need to register copyright as you would say a trademark.

Copyright law in Australia is prescribed by the Copyright Act 1968.

What is a Copyright License?

A copyright license is one way that a copyright owner grants permission for the artistic works to be used and commercialised.

A good example of this would be Netflix. Netflix is a streaming service and does not own the copyright to a lot of the movies/tv shows on their service. They license the protected material from the copyright owners.

There are different types of licences can allow a person to use material that is protected by copyright, which includes the following:

1. A copyright licence granted by the t's & c's on a website.
2. A copyright license for open-source content.
3. A direct copyright licence.
4. A license for commercial use of copyright.
5. A statutory copyright licence.

In most residential building and construction contracts there will be a clause in relation to the ownership of copyright and the licensing rights.

A license in copyright is essentially the permission or consent to use artistic works (drawings and building plans) in which copyright exists.

In Computermate Products (Aust) Pty Ltd v Ozi-Soft Pty Ltd (1988) 20 FCR 46, Sheppard, Spender and Gummow JJ said:

the expression "without the licence of the owner of the copyright" in s. 37 was simply a reference to the absence of the owner's "consent" or "permission" or "licence" as interchangeable terms.

In Hardingham v RP Data Pty Limited [2019] FCA 2075, Thawley J considered the authorities in relation to copyright licenses and said:

A licence of copyright might be granted...