When Fortis Development Limited (Fortis) converted two office buildings in Sheffield into a block of 250 student flats, its directors likely envisaged a lucrative return on investment. Instead, they found themselves embroiled in costly litigation which resulted in an award of damages being made against the company. The reason: copyright infringement.
The facts of this UK case are somewhat atypical, but it serves as a reminder to always consider intellectual property at the outset of a project. In early 2013, a development company called Signature Realty Limited (Signature) identified the site in question in this case as having development potential. It duly commissioned a firm of consultants (C&W) to prepare drawings for the proposed development and submitted these drawings to the local planning authority in order to secure planning permission, which it duly received. The planning permission specified that the site had to be developed in accordance with C&W’s drawings. As was standard practice, the planning application documents, including the approved drawings, were posted on the Sheffield Planning Portal where they became available for public inspection.
Unfortunately, Signature had not actually secured the purchase of the site before it had obtained planning permission. As Signature was unable to complete the purchase of the site due to funding issues, the owner sold the site to Fortis instead. Fortis then developed the site largely in line with the drawings submitted by Signature, with some minor changes submitted. It also used the drawings in various marketing materials.
When Signature became aware of Fortis’ activities, it secured an assignment of the copyright from C&W. It had previously only had a non-exclusive licence to use the drawings in connection with the project. This assignment of copyright included the right to sue for previous infringement and Signature promptly sued Fortis for copyright infringement.
Fortis attempted to rely on a previous case of Blair v Osborne & Tomkins  2 QB 78. In that case, the Court of Appeal in England and Wales held that when an architect is engaged by a client to prepare drawings to obtain planning consent for a development, there is an implied licence to the client to use the drawings for all purposes connected with the erection on the site to which the plans relate, and that the client can transfer that licence to a purchaser of the site. The difference in this case however was that Signature never actually purchased the land it had acquired planning permission for. Fortis had not bought the site from Signature and so could not rely on Blair. It was duly held to have infringed the copyright in the drawings.
This case is a perfect example of the pitfalls many developers fall into when obtaining drawings for a site or when purchasing a site which has already been granted planning permission. It is very important to remember that the granting of planning permission does not, in and of itself, confer any rights to use any drawings which may have been submitted to the planning authority as part of the planning application. Where drawings for a site are in existence, developers should ensure that they actually have a right to use such drawings - for example by obtaining a licence from the copyright owner or by purchasing the copyright outright. Failure to do so could lead to a claim of copyright infringement down the line.
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