Metricon Homes Pty Ltd v Barrett Property Group Pty Ltd

• Jurisdiction: Australia Federal only
• Judgment Date: 01 April 2008
• Neutral Citation: [2008] FCAFC 46
• Court: Full Federal Court (Australia)

FEDERAL COURT OF AUSTRALIA

Metricon Homes Pty Ltd v Barrett Property Group Pty Ltd [2008] FCAFC 46

COPYRIGHT – copyright in plans and drawings of project homes and houses built to their design – infringement – s 14(1) Copyright Act 1968 (Cth) – “substantial part” – meaning – quality rather than quantity – whether work copied was a substantial part of the work in suit – whether sufficient similarity – role of appellate Court in relation to primary judge’s factual findings

Held: primary judge’s findings upheld – appeal dismissed

Copyright Act 1968 (Cth) ss 13(2), 14(1), 32(1), 36(1), 36(1A)

Evidence Act 1995 (Cth)s 54

Federal Court of Australia Act 1976 (Cth) s 24

Autodesk Inc v Dyason (No 2)(1993) 176 CLR 300followed

Barrett Property Group Ltd v Metricon Homes Pty Ltd(2007) 74 IPR 52affirmed

Barrett Property Group Ltd v Metricon Homes Pty Ltd (No 2)[2007] FCA 1823cited

Barrett Property Group Pty Ltd v Carlisle Homes Pty Ltd[2008] FCA 375cited

Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424 considered

Cooper v Universal Music Australia Pty Ltd(2006) 156 FCR 380cited

Eagle Homes Pty Ltd v Austec Homes Pty Ltd(1999) 87 FCR 415considered

LB (Plastics) Ltd v Swish Products Ltd[1979] RPC 551cited

Minister for Immigration and Multicultural Affairs v Jia Legeng(2001) 205 CLR 507cited

Tamawood Ltd v Henley Arch Pty Ltd (2004) 61 IPR 378 cited

Universityof New South Walesv Moorehouse(1975) 133 CLR 1cited

WEA International Inc v Hanimex Corp Ltd(1987) 17 FCR 274cited

Lahore J, Copyright and Designs (looseleaf, Butterworths, 1996)

METRICON HOMES PTY LTD (ACN 005 108 752), ROSS PALAZZESI ANDADRIANGRAHAM POPPLE v BARRETT PROPERTY GROUP PTY LTD (ACN 088 015 267) AND SRS PROPERTY HOLDINGS PTY LTD (ACN 096 513 218)

VID 978 OF 2007

BRANSON, SUNDBERG AND KENNY JJ

1 APRIL 2008

MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIADISTRICT REGISTRY	VID 978 OF 2007

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	METRICON HOMES PTY LTD (ACN 005 108 752) First Appellant ROSS PALAZZESI Second Appellant ADRIAN GRAHAM POPPLE Third Appellant
AND:	BARRETT PROPERTY GROUP PTY LTD (ACN 088 015 267) First Respondent SRS PROPERTY HOLDINGS PTY LTD (ACN 096 513 218) Second Respondent

JUDGES:	BRANSON, SUNDBERG AND KENNY JJ
DATE OF ORDER:	1 APRIL 2008
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1. The appeal be dismissed.

2. The appellants pay the respondents’ costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 978 OF 2007

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	METRICON HOMES PTY LTD (ACN 005 108 752) First Appellant ROSS PALAZZESI Second Appellant ADRIAN GRAHAM POPPLE Third Appellant
AND:	BARRETT PROPERTY GROUP PTY LTD (ACN 088 015 267) First Respondent SRS PROPERTY HOLDINGS PTY LTD (ACN 096 513 218) Second Respondent

JUDGES:	BRANSON, SUNDBERG AND KENNY JJ
DATE:	1 APRIL 2008
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

The CourtINTRODUCTION

1 The corporate parties to this appeal are competitors in the Victorian project homes market. The appeal, which is brought pursuant to leave granted by this Full Court, is from an interlocutory judgment of the Court. On 17 March 2008, for reasons published by his Honour on 28 September 2007 (now published at 74 IPR 52), the learned primary judge (a) made declarations concerning the infringement by the appellants of the second respondent’s copyright in the Seattle 31 house plan and the first respondent’s copyright in a house built in accordance with that house plan; and (b) granted injunctive relief intended to restrain future infringements by the appellants of the respondents’ respective copyrights. The issue of the financial relief, if any, to which the respondents are entitled remains to be determined by the primary judge.

2 For the reasons set out below we have concluded that the appeal should be dismissed.

THE PARTIES AND THEIR RESPECTIVE HOMESThe appellants

3 Metricon Homes Pty Limited (“Metricon”) designs, builds and sells residential project homes in Victoria. Mr Palazzesi is the Managing Director of Metricon. Mr Popple is Metricon’s Product Development Manager. Metricon and Messrs Palazzesi and Popple are together hereafter referred to as the Metricon Parties. Between early 2003 and early 2005 Metricon constructed houses with the names Prada, Tyrell, Connolly, Coburn and Streeton (together referred to as the Metricon Houses).

4 In these reasons for judgment we have for simplicity deleted from the names of the various plans and houses the numbers which indicate the approximate size of the completed houses.

The respondents

5 Barrett Property Group Pty Ltd (“Barrett”), which trades under the name “Porter Davis Homes”, also designs, builds and sells residential project homes in Victoria. Barrett owns the copyright in houses known as the Seattle and the Memphis. The Memphis is an adaptation of the Seattle. SRS Property Holdings Pty Ltd is the owner of copyright in the plans of the Seattle and the Memphis. Like the primary judge, we will refer to these houses and their plans together as the Copyright Works. We will refer to the respondents together as the Barrett Parties and to the Seattle and the Memphis together as the Barrett Houses.

THE CLAIMS

6 The Barrett Parties relevantly claimed at first instance that Metricon had infringed SRS Property Holdings’ copyright in the plans of the Barrett Houses by reproducing a substantial part of such plans without the licence or approval of SRS Property Holdings. The reproductions relied upon were the making of the plans for the Metricon Houses and the construction of the Metricon Houses. The Barrett Parties additionally claimed that Metricon had infringed Barrett’s and/or SRS Property Holdings’ copyright in the Barrett Houses by reproducing a substantive part of the Barrett Houses without the licence or approval of the owner of the copyright. The reproductions relied upon were the construction of the Metricon Houses.

7 The case against Messrs Palazzesi and Popple respectively was that each had infringed the Barrett Parties’ copyright in the Copyright Works by authorising the infringing conduct of Metricon.

CONCLUSIONS OF THE PRIMARY JUDGE

8 Aspects of the reasons for judgment of the primary judge are considered in more detail below in the context of our consideration of the issues raised by the appeal. Nonetheless it is convenient to summarise his Honour’s reasons for judgment here.

9 The primary judge was not required to determine whether copyright subsists in the Copyright Works. The subsistence of copyright in the Copyright Works was ultimately conceded by the Metricon Parties. Nor was his Honour required to determine whether Metricon had reproduced the whole of either or both of the Copyright Works. The Barrett Parties did not seriously press their pleaded case that the whole of the Copyright Works had been reproduced by Metricon.

10 The principal issue for his Honour’s determination was thus, in respect of each of the Copyright Works, whether Metricon had reproduced a substantial part of that work within the meaning of s 14(1) of the Copyright Act 1968 (Cth) (“the Act”). The case before his Honour was conducted on the basis that this issue was to be determined, at least initially, by reference to the plan for the Seattle and a constructed Seattle house, on the one hand, and the plan for the Prada and a constructed Prada house, on the other hand. As discussed below, the plan for the Prada was taken from a drawing known as Prototype 20B which was itself a modification of a drawing known as Prototype 20A.

11 Although all of the plans in suit are annexed to the reasons for judgment of the primary judge, for convenience, we have annexed to these reasons for judgment the critical plans, namely the Seattle plan, the Prada plan (otherwise known as Prototype 21A) and the Prototypes 20A and 20B drawings.

12 As indicated above, his Honour concluded that, by drawing the plan for the Prada and by constructing the Prada house, Metricon had reproduced a substantial part of the plan for the Seattle and the Seattle house. The substantial part identified by the primary judge was the portion of the plan and house which his Honour called the “alfresco quadrant”. We will use the same expression to describe, where applicable, that portion of the respective houses and plans that his Honour described as the “hub of the home”; that is, the kitchen/meals area, the family living area, the alfresco (ie a covered outdoor area) and the rumpus room. In the Seattle plan and the Seattle House and the Prada plan and the Prada house the entire alfresco quadrant is under a single “hip” roof-line.

13 After reaching his conclusion concerning the Prada plan and the Prada house, the primary judge turned to consider the remaining Metricon Houses and their plans. His Honour found that there was a striking similarity between their respective alfresco quadrants and the Seattle alfresco quadrant, both at the plan level and so far as the constructed houses were concerned. He accepted the expert evidence of Dr John Cooke to the effect that:

(a) the alfresco quadrant in each of the Tyrell, the Connolly and the Streeton plans and houses were, subject to minor modification, essentially the same as the Seattle plans and house; and

(b) the rear sections in the Coburn plan and house were derived by reference to the Seattle plan and are modified copies of the Memphis plan and house.

14 His...