Barrett Property Group Pty Ltd v Dennis Family Homes Pty Ltd
[2011] FCA 246
•18 March 2011
FEDERAL COURT OF AUSTRALIA
Barrett Property Group Pty Ltd v Dennis Family Homes Pty Ltd [2011] FCA 246
Citation: Barrett Property Group Pty Ltd v Dennis Family Homes Pty Ltd [2011] FCA 246 Parties: BARRETT PROPERTY GROUP PTY LTD (ACN 088 015 267) and SRS PROPERTY HOLDINGS PTY LTD (ACN 096 513 218) v DENNIS FAMILY HOMES PTY LTD (ACN 056 254 249) File number: VID 1244 of 2005 Judge: DODDS-STREETON J Date of judgment: 18 March 2011 Catchwords: INTELLECTUAL PROPERTY – copyright – whether respondent infringed applicants’ copyright in plans and houses containing an “alfresco quadrant” – subsistence and ownership of copyright conceded – whether the alfresco quadrant a substantial part of the applicants’ works – whether the alfresco quadrant was reproduced in any of the respondent’s works – whether the respondent’s works were independently created – differences in detail and dimension, but overall arrangement of spaces in applicants’ and respondent’s alfresco quadrants was substantially similar – respondent’s designers had access to, and made use of and/or copied, the applicants’ works – infringement claims established. Legislation: Copyright Act 1968 (Cth) ss 10, 14, 21, 31, 35
Evidence Act 1995 (Cth) s 72Cases cited: Antocks Lairn Ltd v I Bloohn Ltd [1972] RPC 219
Australian Competition and Consumer Commission v Lux Pty Ltd [2003] FCA 89
Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300
Barrett Property Group Pty Ltd v Carlisle Homes Pty Ltd [2008] FCA 375
Barrett Property Group Pty Ltd v Metricon Homes Pty Ltd (2007) 74 IPR 52
Cadbury Schweppes v Darrell Lea (2007) 159 FCR 397
Clarendon Homes (Aust) Pty Ltd v Henley Arch Pty Ltd (1999) 46 IPR 309
Data Access Corporation v Powerflex Services Pty Ltd (1999) 202 CLR 1
Designers Guild Ltd v Russell Williams (Textiles) Ltd t/as Washington DC [2001] 1 All ER 700
Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415
Francis Day & Hunter Ltd v Bron [1963] Ch 587
Frank M Winstone (Merchants) Ltd And Ors v Plix Products Ltd (1985) 5 IPR 156
Inform Design & Construction Pty Ltd v Boutique Homes Melbourne Pty Ltd (2008) 77 IPR 523
Kenrick and Co v Lawrence and Co (1890) 25 QBD 99
Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273
Metricon Homes Pty Ltd v Barrett Property Group Pty Ltd (2008) 75 IPR 455
Plix Products Ltd v Frank M Winstone (Merchants) Ltd (1984) 3 IPR 390
Solar Thomson Engineering Co Ltd v Barton [1977] RPC 537
S.W. Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466
Tamawood Ltd v Henley Arch Pty Ltd (2004) 61 IPR 378
University of London Press Ltd v University Tutorial Press Ltd [1916] 2 Ch 601Date of hearing: 19-23 April 2010, 27-29 April 2010 and 3 May 2010 Date of last submissions: 3 May 2010 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 579 Counsel for the Applicants: Mr C D Golvan SC with Dr S Ricketson Solicitor for the Applicants: Middletons Counsel for the Respondent: Mr B N Caine SC with Mr P Wallis Solicitor for the Respondent: Phillips Ormonde Fitzpatrick
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 1244 of 2005
BETWEEN: BARRETT PROPERTY GROUP PTY LTD (ACN 088 015 267)
First ApplicantSRS PROPERTY HOLDINGS PTY LTD (ACN 096 513 218)
Second ApplicantAND: DENNIS FAMILY HOMES PTY LTD (ACN 056 254 249)
Respondent
JUDGE:
DODDS-STREETON J
DATE:
18 March 2011
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [1] The parties’ principal submissions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [14] Barrett’s case........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [14] Dennis’ case........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [15] Background and summary of evidence........ ........ ........ ........ ........ ........ ........ ........ ........ .... [18] Outline of facts and evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [21] The Barrett business and copyright in the plans........ ........ ........ ........ ........ ........ ........ .. [21] Display houses........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [30] The Dennis Group........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [35] Chronology of events........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [39] Did the Dennis works reproduce a substantial part of Barrett works........ ........ ........ ...... [86] Relevant legislation and legal principles........ ........ ........ ........ ........ ........ ........ ........ ..... [86] Substantial Part........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [109] Was the alfresco quadrant a substantial part of the Barrett works?........ ........ ........ ..... [130] Dr Cooke’s Evidence on substantial part........ ........ ........ ........ ........ ........ ........ ........ . [134] Cross-examination of Dr Cooke........ ........ ........ ........ ........ ........ ........ ........ ........ .. [151] Evidence of Sales Staff........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [158] Mr Miller’s Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [174] Cross-examination of Mr Miller........ ........ ........ ........ ........ ........ ........ ........ ........ .. [198] Mr Miller’s Instructions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [201] Court’s view of Barrett houses........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [219] The Seattle........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [219] The Memphis........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [220] Conclusion on whether alfresco quadrant a substantial part of Barrett houses........ ... [222] Whether sufficient objective similarity between Barrett and Dennis works........ ........ ... [228] Dr Cooke’s evidence on similarity........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [233] Seattle and Grange 291........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [233] Seattle and Grange 322........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [242] Memphis and Grange Plans........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [250] Seattle and Esperance........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [257] Seattle and the Flinders........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [260] Seattle and Thornton........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [265] Memphis and Esperance/Flinders........ ........ ........ ........ ........ ........ ........ ........ ........ [266] Mr Miller’s evidence on similarity........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [267] Court’s visual impression of similarity........ ........ ........ ........ ........ ........ ........ ........ ........ [281] Grange 322........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [283] Flinders 270........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [284] Flinders 290........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [285] Thornton 310........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [286] Grange 291........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [287] Conclusion on whether sufficient objective similarity........ ........ ........ ........ ........ ........ [288] Were the Dennis works created without reference to the copyright works?........ ........ ... [292] Relevant case law........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [293] Ms Wilson’s evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [304] Ms Wilson’s role at Dennis........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [331] Creation of Dennis designs........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [348] Dr Cooke’s analysis of Grange design pathway........ ........ ........ ........ ........ ........ ...... [375] Absence of file of Ms Wilson’s work........ ........ ........ ........ ........ ........ ........ ........ ...... [385] Mr Caiafa’s evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [387] Mr Brigden’s evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [393] Mr Rowley’s evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [401] Mr Rowley’s second affidavit........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [429] The Opposition Display Visits 2003........ ........ ........ ........ ........ ........ ........ ........ ........ [436] Design of Grange........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [449] Dr Cooke’s analysis of design pathway of Mr Rowley’s designs........ ........ ........ ... [482] Court’s view of Lexton B3........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [489] Mr Hofmeyer’s Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [490] Mr Denison’s Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [522] Conclusion on Copying........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [534] Conclusion........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [579] INTRODUCTION
In this proceeding, it was necessary to determine whether the respondent, Dennis Family Homes Pty Ltd (“Dennis”), infringed the applicants’ copyright in plans and houses constituting original artistic works under the Copyright Act 1968 (Cth) (“the Act”) by making use of the applicants’ works to design and build various project houses. For the reasons set out in detail below, I have found that the applicants’ infringement claims are established.
The applicants (collectively, “Barrett”) design, build and market project homes, under the name Porter Davis, competing in the volume housing market with other participants, including Dennis.
Dennis, a member of the Dennis Family Corporation group of companies (“Dennis Group”), is and was an established volume builder which, in competition with Barrett, designs, constructs and sells project houses in Victoria and southern New South Wales.
The applicants’ artistic works in question are the plans and the house versions thereof known as the Seattle 31 (“Seattle”) and the Memphis 33 (“Memphis”). The subsistence and ownership of copyright in the works, while initially in dispute, were ultimately conceded. The first applicant, Barrett Property Group Pty Ltd (“BPG”), owns the copyright in the house versions and the second applicant, SRS Property Holdings Pty Ltd (“SRS”), owns the copyright in the plans.
Barrett alleged that, from at least early to mid‑2003, Dennis infringed their copyright in the Seattle and Memphis house and plans by reproducing a substantial part thereof known as “the alfresco quadrant” to create plans for seven different project home designs and subsequently to build, market, promote and sell houses constructed in accordance with the designs. The Dennis designs in question are:
(a)the Grange 291
(b)the Grange 322
(c)the Thornton 310
(d)the Esperance
(e)the Flinders 270
(f)the Flinders 290
(g)the Flinders 310
(collectively, “the Dennis works”).
A schedule of the plans of the above Barrett and Dennis designs is attached.
The term “alfresco”, sometimes used interchangeably with the term “sala”, is used in the housing industry and was used by the parties in this proceeding to describe a covered outdoor eating area under the roof of the house and proximate to the informal living areas.
In the present case, the alfresco was situated in an the alfresco quadrant to the rear of the houses, described by Barrett as follows:
…the Alfresco Quadrant [refers] to the following areas in [the Seattle and Memphis] designs: (running from the top right hand corner) the rumpus, family, kitchen and meals areas around the alfresco on the side, all under the one roofline, but also having regard to the location and relative dimensions of rooms in this part of the house design.
The proceeding incorporated a large number of distinct infringement claims, as Barrett alleged that seven Dennis plans and seven Dennis houses infringed its copyright in the Seattle and Memphis plans and the resulting houses. In practice, a number of factors reduced the scope of the issues in dispute. The claims had a common background and there was a considerable overlap of the relevant evidence. Further, it was usually possible, for present purposes, to treat the Seattle and Memphis designs as broadly interchangeable. (The Memphis plan was a somewhat larger version of the Seattle with few variations.) It was also mostly unnecessary to distinguish between the plan and house versions of the designs in issue.
Similarly, it was undisputed that the Grange 322 (of which there were two versions) and the Thornton 310 were relevantly similar to, and derived from, the Grange 291, or that the Flinders 270, Flinders 290 and the Flinders 310 were relevantly similar to, and derived from, the Esperance.
As the subsistence and ownership of copyright were conceded, the questions ultimately remaining in dispute were:
(a)whether the alfresco quadrant constituted a substantial part of the Barrett works;
(b)if so, was the Barrett alfresco quadrant reproduced in any or all of the Dennis works;
(c)were the Dennis works independently created by Dennis’ employees without copying, directly or indirectly, the Barrett works. Alternatively,
(i)did Ms Wilson, a designer employed by Dennis in the Shepparton office of its Regional Division, copy the Barrett works in designing the Grange 291, from which Dennis’ National Design Manager, Mr Rowley, subsequently derived the Grange 322 and Thornton 310? Subject to the possibility that the pronounced projection of the sala in one version of the Grange 322 distinguished it from the Barrett works sufficiently to preclude infringement, the determination of whether the Grange 291 infringed the copyright in the Barrett works would also determine whether the Grange 322 and Thornton 310 also infringed, as it was common ground that those designs were derived from the Grange 291 by making modest variations;
(ii)did Mr Rowley create the Esperance (from which the relevantly similar Flinders 270, Flinders 290 and Flinders 310 were admittedly derived) independently and without copying, directly or indirectly, the Barrett works, instead deriving it, as he testified, from the Lexton B3 which Mr Rowley designed for Dennis in 1999? Or, as Barrett argued, did Mr Rowley produce the Esperance and the three Flinders plans by copying or making use of the Barrett works?
It was necessary to consider voluminous evidence, including numerous plans of the copyright works; plans of the alleged infringing works; earlier Dennis plans; plans of third party builders; and expert evidence in relation to the originality and substantiality of the alfresco quadrant in the Barrett copyright works, its alleged reproduction in the Dennis works and the alleged independent design pathways by which the Dennis employees asserted that they had developed the Dennis works. The Court participated in views of houses constructed according to the plans.
It was also necessary to consider the evidence of lay witnesses, including, most importantly, that of the Dennis designers, Ms Wilson and Mr Rowley, whose credit in relation to the processes, antecedents and context of their creation of the allegedly infringing designs was particularly significant.
THE PARTIES’ PRINCIPAL SUBMISSIONS
Barrett’s case
Barrett submitted that:
1.The alfresco quadrant represented a substantial part of the original Barrett works in the requisite qualitative sense. While the individual elements were not novel, it was an original arrangement of spaces different from any pre‑existing design, which resulted from the application of considerable skill and labour. It was not merely dictated by functional requirements or volume housing constraints.
2.The Barrett alfresco quadrant was reproduced in the Dennis works. There was a strong visual resemblance and sufficient objective similarity, despite various differences of detail and dimension. The similarities were not dictated by a combination of external constraints and functional requirements.
3.In designing the Grange 291, Ms Wilson made use of or copied the Barrett plans or the Seattle and Memphis houses (or infringing Metricon houses) the creation and public display of which predated the creation of the Grange 291. Further, Mr Rowley, as he acknowledged, subsequently modified the Grange 291 to produce the Grange 322 and Thornton 310. Mr Rowley also made use of or copied the Barrett works or infringing copies thereof to create a second group of infringing Dennis works comprising the Esperance, the Flinders 270, the Flinders 290 and the Flinders 310.
4.The evidence the Dennis designers (Ms Wilson and Mr Rowley) gave of their independent creation of the Dennis works should be rejected. Considerable time had elapsed since the production of the Dennis works and, as the Dennis witnesses conceded that they had no memory of many significant matters and were unreliable in other respects, the picture emerging from the contemporaneous documents in evidence should be preferred. It established that Dennis design personnel had access to, and an interest in, the Barrett works for a prolonged period prior to the creation of the infringing works, evidenced by documents which Dennis failed to discover and which its witnesses initially denied, consistently attempted to minimise, but ultimately conceded.
5.Barrett acknowledged that, contrary to its case on opening, Ms Wilson produced the Grange 262 and Grange 292 (to which the Grange 291, first documented on 20 June 2003, was relevantly similar) by 27 April 2003. For approximately two and a half years prior to the production of the Grange 291, the Barrett works (from their introduction to the market in 2000 onwards) were frequently located near or adjacent to a number of Dennis display sites or display sites of other builders (Metricon and Carlisle) exhibiting houses which were subsequently held to have infringed Barrett’s copyright in the Seattle and Memphis plans and houses. In August 2002, a Dennis designer took photographs of the Memphis house, which were stored on the Dennis computer network. In early 2003, shortly prior to Ms Wilson’s design of the Grange 291, Dennis’ awareness of opposition products, its own outdated designs and its loss of competitive advantage caused Mr Rowley, as newly appointed National Design Manager, to institute a formal program of inspection of competitors’ display sites. The Dennis designers consequently visited houses including those of Barrett. On 2 April 2003, Mr Rowley participated in a design team inspection of the Metricon Tyrell and Prada houses (which have been held to constitute infringements of the Barrett copyright works). At the inspections, Dennis design personnel (probably the late Ms Shirley Rak) took notes of the display houses’ features. Mr Rowley intended to disseminate the notes and made related reports to the Dennis board. Ms Wilson was, prior to and while designing the Grange houses, in frequent communication with Mr Rowley, Ms Rak, other Dennis design staff and the Dennis acting Chief Executive Officer, Mr Hofmeyer, in relation to design. Those persons had the opportunity to transmit to Ms Wilson details, materials or instructions about the Barrett works with which they were familiar. Ms Wilson also had opportunities to view the Barrett works or infringements thereof directly.
6.In contrast to the unchallenged evidence of Barrett’s witnesses as to the laborious process of creating the Barrett works by successive sketches, interchange, variations and instructions (resulting in a significant record of memoranda and sketches), the Dennis designers offered no detailed, credible explanation or substantial file record of their claimed independent design pathway leading to the production of the Dennis works. There was no record at all of Ms Wilson’s alleged design processes leading to her creation of the Grange 291 (or other Grange designs). Rather, the earliest documented Grange 291 plan was 20 June 2003, and there was no indication of what design work had occurred between 27 April 2003 and that date. Similarly, Mr Rowley’s account of how he had produced the Esperance from the pre‑existing Dennis Lexton B3 design was evidenced only by a few conceptual pencil sketches.
7.In the opinion of Barrett’s expert witness, Dr Cooke, the Dennis works did not constitute a continuation of a chain of design commencing with prior Dennis or any other identified third party builder’s designs. Dr Cooke considered that the Grange designs (and hence the Grange 322 and Thornton 310) were independent of the prior Dennis Derwent and Stratford designs which Ms Wilson identified as influences.
8.Further, in Dr Cooke’s view, the plans for the balance of the Dennis works produced by Mr Rowley did not show a chain of design back to the Dennis Lexton B3 but rather, were unlikely to have been developed without reference to the Grange plans, which included the distinctive alfresco quadrant.
Dennis’ case
Dennis denied that its works reproduced a substantial part of the Barrett copyright works. It submitted, for reasons discussed in more detail at paras 132 to 133 below, that the alfresco quadrant was a non‑distinctive arrangement of known features.
Dennis also denied that its designers had copied or made use of the Barrett’s copyright works to produce the Dennis works.
Dennis submitted that:
1.Ms Wilson independently conceived of and designed the Grange 291 in about April 2003 without any reference to Barrett’s copyright works. In mid to late 2003, the Grange 291 was modified to create the Grange 322. Mr Rowley, in April 2004, marked up the Grange 322 plan and created the Thornton 310 in October 2005 by marking up the Grange 322.
2.Mr Rowley created the balance of the Dennis works without reference to Barrett’s copyright works. Between 2003 and 2006, he also successively designed the Esperance and the Flinders 270, Flinders 290 and Flinders 310. As he testified, the Esperance was a new version of the Lexton B3. The Lexton B3 was a very commercially successful project house Mr Rowley had designed for Dennis in 1999, prior to the creation and public exhibition of the Barrett copyright works. Mr Rowley modified the Lexton B3 to produce the Esperance by adding a sala (a feature already included proximate to informal living in other pre‑existing Dennis homes) in an obvious location. The three Flinders plans and houses were, in turn, variations of the Esperance.
3.Similarities between the alfresco quadrant (or sala) in Barrett’s Seattle and Memphis plans and houses and the Dennis plans and houses were dictated by the very limited compass for variation imposed by the external constraints associated with volume housing, including block size, cost, the necessary rooms, amenities and functional features typically included in project houses, and their logical mutual positioning.
4.There were many differences between, on the one hand, the Grange 291 and the Seattle and, on the other hand, the Esperance and the Seattle. The Grange 291 had similarities to earlier Dennis designs and there was a limited range of options realistically available to the designer, given the requisite standard features and applicable constraints.
5.Essentially Barrett sought, contrary to copyright principles, to protect the mere idea of a side‑facing sala within a single roofline. An alfresco area consisting of an alfresco (or sala) recessed into the side of the house bounded on three sides and covered by the main house roof to give a strong indoor/outdoor connection was not a new concept, as the antecedent Bordeaux and Independence 2002 designs showed.
6.The Hawkesbury design (although later than the Barrett copyright works) included an area almost identical to the Barrett alfresco quadrant, and there was no evidence that it had been copied from the Barrett works. The Sandalwood and the Woollahra houses, produced by independent designers, showed almost identical covered courtyards. The Sandalwood and the Hawkesbury houses demonstrated that salas could be placed in various locations.
7.Numerous plans predating the Barrett works included an alfresco area and established that there was a considerable scope for variation in expressing the concept of a sala. Mere similarity in general arrangement of the outdoor alfresco area in conjunction with the rumpus room, living, meals and kitchen areas did not establish infringement or support an inference to copying. Reproduction of the particular form of expression, as opposed to the idea, required a similarity of detail between the Barrett and Dennis alfresco quadrants, including the position in the house, the shape, the dimensions, the extent to which it was under a roofline and the proximate rooms.
8.In fact, there were many significant differences of detail, shape and dimension between the Barrett and Dennis works, including in their alfresco areas, which indicated that they shared similarities only of the idea, rather than its detailed expression.
9.The shape of the alfresco quadrant in the Grange 291 differed from that of the Seattle which was not square. The sala itself in the Grange 291 was essentially square with a chamfered corner and different dimensions from those of the Seattle. The Grange 291 had a solid wall between the sala and the home theatre. The front part of the Grange 291 and its informal living areas had many differences, including in shape and dimension when compared with the Seattle. There were also differences of arrangement and dimension in the subsidiary bedroom wing.
10.The inclusion of the sala under a simple roofline (while obvious in any event) was not reproduced in either the Grange 291 (where the roofline had its own hip and valley construction) or in the Grange 322, where the first version had a projecting sala on piers. The second version of the Grange 322 had a sala brought under the roofline. The alfresco in the Esperance differed in proportion and shape from that of the Seattle. It was a long thin rectangle with different walls and windows.
11.Dennis’ witnesses’ evidence of their independent creation of the two distinct groups of houses was, on the totality of the evidence, credible and fatal to the establishment of infringement.
12.Given the common place constituent features and standard spaces and amenities which must be placed logically vis‑à‑vis each other within the constraints of cost and block size, it was credible that Ms Wilson, as she testified, created the Grange 291 independently from “the furniture of her mind”, based on her background and experience.
13.The various rooms and features included in the Dennis houses were not unusual and their location was, in each case, logical. In 2003, when Ms Wilson designed the Grange 291 for a standard rectangular block, including a rumpus room or home theatre as she had seen in Perth, once it was decided to add a sala, she placed it in a logical and obvious position. As Dr Cooke, Barrett’s expert witness, conceded, if all the other rooms in the Grange 291 were positioned as they were and a rumpus room or home theatre were located in the back left‑hand corner, it would create a logical place for a sala. The only sensible location for an added sala in the Grange 291 would be its current position.
14.It was not alleged that the front third or the L‑shaped subsidiary bedroom wing in the Grange 291 was copied, which was consistent with the independent creation of the entirety.
15.By the time she designed the Grange 291 in the Regional Division, Ms Wilson was aware of covered pergolas and had observed the sala in the Atrium and other houses in Queensland in 2001. Ms Wilson had already created the Panorama with a sala and rumpus room and was aware of or had modified other Dennis houses, including the Stratford 282, the Mandalay, the Glenrowan, the Lexton B3 and the Derwent. She had already designed the Karinya, the Montville and Lonsdale Square.
16.The Grange 291 had significant similarities with plans Ms Wilson had already modified or produced and other Dennis or third party plans of which she was aware. The kitchen bench in the Grange 291 was similar to that in the Lonsdale. The location of the meals areas was self‑evident having regard to functionality, and Dr Cooke conceded that the location of various features was sensible and logical.
17.Thus, Ms Wilson’s explanation of how she created the Grange houses was consistent with developing, in an obvious way, plans she had already designed or observed or the pre‑existing Dennis or other plans with which she was familiar, in the light of the logical requirements of positioning.
18.When required to design new plans in March 2003, Ms Wilson created a number of houses including a sala in various positions, as well as the Grange houses. Ms Wilson first created the Grange 262 (in draft with a “meat cleaver” shape) and Grange 292 (in draft with a square sala under the roofline) by 27 April 2003. By June 2003, they were modified to create the Grange 291. Ms Wilson’s brochure plans for the Grange 291 were sent on disk to a draughtsman in the Shepparton office, Mr Caiafa, who transformed them into working drawings dated 20 June 2003. In the working drawings, the Grange 262 was finalised in a square shape with a sala to the rear corner and the Grange 292 had a projecting sala.
19.The evidence supported Ms Wilson’s assertion that she had not seen the Barrett designs before designing the Grange 291. Ms Wilson was employed by a third party and was thus independent of Dennis at the time of giving evidence. While employed by Dennis, she was based in the Shepparton division and thus, both geographically and administratively, segregated from other divisions and the personnel who worked in them:
19.1The regional market in which she operated was a “little world” in which Porter Davis had no presence. She knew nothing of Porter Davis, the popularity and success of its sala, nor Metricon’s success with an alfresco, as the developments in the Melbourne market were irrelevant to her work.
19.2Ms Wilson had no recollection of being told of the Dennis metropolitan design team’s visits to competitors’ display sites in 2003 or of seeing notes of the visits. She could recall no awareness that Dennis faced competition from Porter Davis and Metricon. She became aware that Metricon was coming to the Regional area, but probably not before late 2003.
19.3Ms Wilson testified that her interaction with Melbourne Dennis personnel was uncommon and, when it occurred, she viewed herself as an outsider rather than a member of the team. Despite her formal membership of the Dennis National Design Team in 2003, her evidence was that she made no contribution to it prior to mid‑June 2003.
19.4Other Dennis employees who had or may have had access to the Barrett works did not communicate material or relay directions to Ms Wilson. Mr Hofmeyer, who was also an independent witness, confirmed that he only communicated general directions to Ms Wilson and had no input into the design of the Grange 291. He confined his input to building and construction issues. Mr Rowley gave evidence that he had no discussions with Mr Hofmeyer or Ms Wilson about the implementation of the design task Mr Hofmeyer assigned her, and prior to about April 2003, he did not know that Ms Wilson had been instructed to design seven houses.
19.5There were no diarised meetings in 2003 between Mr Rowley and Ms Wilson prior to May 2003. The subsequent diarised meetings could not have had any impact on Ms Wilson’s design of the Grange in late April 2003. Mr Rowley could not recall any discussions with Ms Wilson prior to telephoning her shortly before about 1 May 2003 in order to request copies of the designs she was working on. On 1 May 2003, he received her fax of brochure plans for the Grange 262, the Amberleigh and the Palladium (then called the Atrium). Ms Wilson’s evidence was that she did not fax the Grange 292 plan because Mr Rowley requested only those designs contemplated for construction. Mr Rowley then provided feedback in a telephone conversation, which was the only instruction Ms Wilson recalled receiving in relation to the Grange.
19.6Ms Wilson could not recall visiting display home sites prior to May 2002, when she probably visited Dennis homes. She could not recall the August 2003 visit she made to the Dennis display site, although she could recall visiting a number of different builders’ display sites. The August 2003 photographs she admittedly took of the Memphis were of presentation features. Her admitted late 2003/2004 visit to the Metricon display site with a new colleague, Ms Fraser, post‑dated the alleged infringing designs and was directed at specification items, being a feature wall and a spa bath.
19.7Ms Wilson’s assertion that she rarely saw The Herald Sun Property Guide was not challenged and Mr Hofmeyer was not examined about how often he provided it to Ms Wilson. Ms Wilson gave evidence that she rarely used the internet or saw the websites of other builders.
20.Ms Wilson was not challenged about her failure to maintain a design file. Ms Wilson recalled that she did not copy the Barrett works.
21.Mr Rowley’s evidence of designing the balance of the Dennis works without reference to the Barrett works was also credible. Mr Rowley was also an experienced designer who had produced the very successful Lexton B3.
22.In contrast to Ms Wilson, Mr Rowley kept a design file. He did not absolutely deny awareness of Porter Davis or his possible access to the Seattle or Memphis. Nor did he conceal the Dennis “opposition visits” to competitors’ display sites. He gave a satisfactory explanation for his late production of his diaries and the notes of the opposition visits. Mr Rowley gave a credible account of using the successful Lexton B3 in 2003 to produce an updated design for narrower blocks at the behest of Mr Denison (the manager of Triline) and Ms Schaefer (who requested that he include an alfresco). Once it was decided to add an alfresco to the Lexton B3, he placed it in the logical position, between the meals and rumpus room in a pre‑existing quadrant of rooms. There was an existing area between the meals and the rumpus room which was partly covered by a simple roofline. Mr Rowley considered that the Lexton B3 and the Seattle had essentially the same connection between the indoor and outdoor spaces. If, contrary to Dennis’ submission, he took the added alfresco itself from the Barrett copyright works, it would not constitute infringement unless the entire alfresco quadrant was also taken.
BACKGROUND AND SUMMARY OF EVIDENCE
The following affidavits were filed and read on behalf of Barrett:
(a)Affidavits of Anthony John Roberts sworn 23 May 2007, 7 December 2009 and 21 December 2009.
(b)Affidavit of Daniel John Studderd sworn 5 June 2007.
(c)Affidavit of Keith Fuller sworn 12 July 2007.
(d)Affidavit of Randall Redfern Pye sworn 12 July 2007.
(e)Affidavit of Adele Mihalcsek sworn 25 July 2007.
(f)Affidavit of David Peter Shergold sworn 26 July 2007.
(g)Affidavit of Rhonda Kellett sworn 27 July 2007.
(h)Affidavits of Dr John Richard Cooke sworn 19 September 2008 (“first Cooke affidavit”) and 2 December 2009 (“second Cooke affidavit”).
(i)Affidavit of Annika Jessie Anderson affirmed 4 December 2009.
(j)Affidavit of Mark David McLoughlan sworn 7 December 2009.
(k)Affidavit of Paul Anthony Wolff sworn 7 December 2009.
(l)Affidavit of Shane Keast sworn 7 December 2009.
(m)Affidavit of Anthony Brooke Watson sworn 9 December 2009.
The following affidavits were filed and read on behalf of Dennis:
(a)Affidavit of Graham Keith Hofmeyer sworn 3 December 2008.
(b)Affidavits of Jodie-Maree Wilson sworn 3 December 2008 (“first Wilson affidavit”) and 27 April 2010 (“second Wilson affidavit”).
(c)Affidavits of Kelvyn James Rowley sworn 23 December 2008 (“first Rowley affidavit”) and 6 April 2010 (“second Rowley affidavit”).
(d)Affidavit of Anthony David Denison sworn 21 January 2009.
(e)Affidavits of Leighton Russell Wade sworn 27 March 2009 (“first Wade affidavit”) and 26 April 2010 (“second Wade affidavit”).
(f)Affidavit of Bryan Gordon Eakins Miller sworn 7 May 2009.
(g)Affidavit of Ian Morris Kiefel sworn 30 March 2010.
(h)Affidavit of Jason Bryan Brigden sworn 22 April 2010.
(i)Affidavit of Paul John Caiafa sworn 27 April 2010.
The following witnesses were cross‑examined:
(a)Jason Brigden;
(b)Dr John Cooke;
(c)Anthony Denison;
(d)Graham Hofmeyer;
(e)Shane Keast;
(f)Mark McLoughlin;
(g)Bryan Miller;
(h)Kelvyn Rowley;
(i)Jodie-Maree Wilson; and
(j)Paul Wolff.
OUTLINE OF FACTS AND EVIDENCE
The Barrett business and copyright in the plans
The Barrett business was formed in May 1999 when Daniel Stutterd and Anthony Roberts, who had previously been employed by other volume builders (Metricon and Henley respectively), set up their own business. The plans for the Seattle, in which Barrett ultimately acquired the copyright, originated in drawings made prior to June 1999 by Daniel Stutterd, who was then an employee and director of BPG.
In June 1999, Mr Stutterd engaged Keith Fuller to design a single storey home with more luxurious features usually found in double storey designs. As Mr Fuller’s engagement proved unproductive, Mr Stutterd gave the drawings to a contract draughtsperson, Mr Pye (trading as Randall Pye Building Design and Drafting Services), between June 1999 and September 1999. In consultation with Mr Stutterd, Mr Pye worked on the project with his employee, Ms Mihalcsek, also using earlier work of another contract draughtsperson, Ms Kellett. By that process, the Seattle design was developed. Mr Pye’s evidence of his interaction, particularly with Mr Stutterd, and the process of developing and varying the successive drafts of the plans, was unchallenged. The affidavits of Ms Kellett and Ms Mihalcsek described their work and involvement in the overall design process.
The evidence of the above persons concerning the creation of the Seattle and the Memphis was previously considered in detail in Barrett Property Group Pty Ltd v Carlisle Homes Pty Ltd [2008] FCA 375 (“Carlisle”) and Barrett Property Group Pty Ltd v Metricon Homes Pty Ltd (2007) 74 IPR 52 (“Metricon”).
In Carlisle, Heerey J concluded that Carlisle’s Provence design infringed Barrett’s copyright in the Seattle and Memphis plans and houses. In Metricon, Gilmour J concluded that Metricon’s Prada 35, Tyrell 29, Connolly 30, Couburn 33 and Streeton 34 had infringed Barrett’s copyright in Seattle and Memphis plans and houses.
In Metricon, the subsistence of copyright in the Barrett works was not challenged. Gilmour J noted (at [34]):
The drawing process, as evidenced in the applicants’ affidavit material, shows a substantial evolution in the design concept and implementation, which is clearly revealed in the sequence of drawings exhibited. There are approximately 130 drawings and notes that culminate in the final Seattle 31 plan, which Barrett approved in or about September 1999.
In contrast, in Carlisle, the respondent did not concede the subsistence of copyright in the Barrett works and disputed the number of 130 preparatory drawings. Heerey J’s estimate, however, accorded with the finding of Gilmour J. Heerey J considered Mr Stutterd a credible witness, whose evidence was corroborated by Mr Pye, Ms Kellett and Ms Mihalcsek. Heerey J concluded that Barrett “came to the design of the Seattle in the way it says” (at [32]).
In this case, Barrett submitted, and it was undisputed, that the design of the Seattle involved a significant and continuing process of interchange between Messrs Stutterd and Pye, including:
(a)the giving of written instructions by Stutterd and written responses by Pye…;
(b)Pye’s initial drawings with dimensions;
(c)Stutterd’s written responses;
(d)Pye’s notes on drawings;
(e)Pye's plans and notes for aspects of the design, such as the roof design, lighting positions, en suite layouts at and detailed final amendments; and
(f)a record of Pye’s attendances in connection with the Seattle design
Barrett gave the following unchallenged account of the creation of the Memphis plans:
Keith Fuller, a designer employed by BPG, created a modified version of the Seattle Plan in or about early 2001 which became known as the Memphis design. The detail of changes made to the Seattle is referred to by Stutterd ... Fuller gives evidence on the design process for the Memphis plan … and exhibits copies of plans he created, based on the Seattle, in the course of creating the Memphis …. Fuller demonstrates the enlargement of Seattle to become Memphis ….
BPG approved the Memphis design in or about July 2001
Barrett acquired copyright in the Seattle plans by the following assignments and licences:
Assignments of copyright in the relevant plans for Seattle (together with the rights to bring infringement proceedings for past infringements) have been made as follows:
(a)from Pye to BPG dated 9 April 2001 and 1 June 2005 respectively:;
(b)from BPG to SRS dated 5 July 2001, and 1 June 2005 respectively; and
(c)from Kellett to SRS dated 27 February 2007 (in the same form as the Pye assignment).
On 19 July 2005, SRS granted BPG a non-transferable, exclusive and royalty-free licence to use the copyright in the Seattle plans for a period of 20 years.
Display houses
In September 1999, the Seattle plan was completed. Thereafter, Barrett, trading as “Porter Davis”, began to market, build and sell houses in accordance with the Seattle plan.
In January 2000, Barrett opened a 31 square display house constructed by Shergold, a registered builder, in accordance with the Seattle plan (“the Seattle house”) at a display village in Beaconsfield.
In 2001, during the course of his employment with BPG, Mr Fuller created a modified version of the Seattle plan which became known as the Memphis. Copyright in the Memphis plans vested automatically in BPG as employer of Mr Fuller, pursuant to s 35(6) of the Act.
From November 2001, it also displayed, built and marketed the Memphis, which was essentially a larger version of the Seattle.
From January 2000, a number of Barrett display villages containing either the Seattle or the Memphis were opened throughout various outer Melbourne areas. In a number of instances, the Barrett display centres were situated adjacent or near to an existing Dennis (or a Metricon) display centre. In other cases, Dennis opened a display centre near to an existing Barrett display centre.
The Dennis Group
From 1996, following the Dennis Group’s acquisition of Executive Family Homes Pty Ltd, Dennis sold houses under three brand names directed at different market sectors. The Glenbrae brand was aimed at first home buyers, the Executive brand was aimed at second or third home buyers, and the Triline brand occupied a midrange position.
Prior to September 2004, Dennis conducted its business through three operating divisions, namely, the Melbourne Metropolitan Division (“Metro Division”), a regional Victorian Division (“Regional Division”) and the Queensland Division. In September 2004, the Queensland Division was closed.
The Metro Division offered all three Dennis brands of project houses, while the Regional and Queensland Divisions offered only the Glenbrae and Executive brands.
At all relevant times, Dennis employed Kelvyn Rowley, Jodie Wilson and Graham Hofmeyer. From 1994, Mr Rowley, an architect, was successively employed by different Dennis Group entities in various drafting positions. Mr Rowley was principally based in Melbourne at the Metro Division. From 1996, Ms Wilson, an architectural draughtsperson, was successively employed by various Dennis Group entities. Ms Wilson was based at the head office of the Regional Division in Shepparton. From 1996 to about 2004, Mr Hofmeyer was, inter alia, the manager of the Regional Division, including the main Shepparton office and offices in Ballarat, Bendigo, Mildura, Albury, Wodonga and Wagga.
Chronology of events
In May 2000, Barrett opened a second Seattle display site at Chirnside Park. A third Seattle display site opened in May 2001 at The Gateway, Lilydale.
On 4 April 2001, Mr Rowley met Ms Wilson and Mr Hofmeyer in Melbourne.
In or about early 2001, Keith Fuller created the Memphis plan by making modest variations to the Seattle plan. In essence, the Memphis was slightly larger than the Seattle.
On 1-2 May 2001, Mr Rowley (then a draughtsman with Dennis Metro Division), Ms Wilson (then the design manager of the Regional Division at Shepparton) and two other Dennis employees, a Metro division designer, Alistair McLean and a colour consultant, Danielle Taylor, visited Queensland together in order to view Dennis’ Queensland houses, including a house known as the Grand Atrium which included a sala.
In July 2001, the Memphis plan was completed and Barrett approved it.
In October 2001, Dennis opened a display site at Highgate Way, Ferntree Gully/Rowville.
In November 2001, Barrett introduced a Memphis house, constructed under Shergold’s direction in accordance with the Memphis plan (“the Memphis house”), at a display village at 5 Highgate Way, Rowville, Victoria.
At a date after the above Memphis display site opened, probably in 2001, Dennis personnel visited, or otherwise became aware of, the Memphis house.
Over the period from January 2002 to July 2003, further Dennis display sites opened at 9, 11 and 13 Highgate Way, Rowville, adjacent to the Barrett Memphis display site in Highgate Way, Rowville.
On 8 May 2002, Mr Rowley met with Ms Wilson, probably at Shepparton.
On 9 May 2002, Ms Wilson, together with other Dennis personnel including Mr Rowley, visited display sites (asserted by Mr Rowley to be Dennis display sites) in and around the Melbourne area. On the following day, Ms Wilson sent an email to Mr Rowley in relation to the visits.
In August 2002, Barrett opened another Memphis display site at Moondara Drive, Berwick.
In early August 2002, an unidentified Dennis designer took a number of photographs of the Memphis display house at Rowville, which were stored in the Dennis computer network.
On 1 to 2 August 2002, a Dennis corporate conference attended by a large number of employees, including Mr Rowley and a large contingent of Shepparton based personnel, took place. Ms Wilson did not attend.
Prior to the end of 2002, Ms Wilson visited the Dennis display site outside Pakenham (which was close to the Barrett Berwick Seattle and Beaconsfield Memphis display sites).
In 2003, Barrett released a further modified version of the Seattle design, known as the Aberdeen.
In January 2003, the Dennis business underwent major changes in structure, personnel and operations, as serious sales and budget problems had emerged. As a result of the reorganisation:
(a)Mr Hofmeyer was appointed the acting Chief Executive Officer of Dennis;
(b)Mr Rowley was appointed the National Design Team Manager;
(c)Ms Wilson became a member of the National Design Team; and
(d)Mr Rowley instituted a formal programme of opposition display site visits for the members of the Dennis National Design Team
Also in February 2003, a Dennis three day corporate planning meeting occurred.
In February 2003, a Memphis display site opened at Elliot Parade, Lynbrook.
On 5 February 2003, Mr Rowley met Mr Hofmeyer in Shepparton or Melbourne.
In March 2003, a Metricon Tyrell (the subject of litigation in Metricon, discussed above at para 25) display site opened at Paramatta Walk, Craigieburn, an area where Dennis display sites had existed since about September 1999.
In March 2003, the first documented visit by members of the Dennis National Design Team to an opposition display site occurred. It included inspections, on 5 March 2003, of a Henley display home at Princes Highway, Hallam, and a “Mirvac – The Heath” display home at St Andrews Drive, Heatherton, attended by Jason Brigden, Alistair McLean and Shirley Rak.
In March 2003, Mr Rowley made a written report to the Dennis Board.
In March 2003, Ms Wilson received instructions from Mr Hofmeyer about the style of a number of new house designs she was required to design for Dennis. Ms Wilson also visited Perth to inspect houses at the behest of Mr Hofmeyer.
On 1 April 2003, the Metricon Prada display site opened at Fogarty Avenue, Highton.
On 2 April 2003, members of the Dennis National Design Team (Messrs Rowley, McLean and Brigden and Ms Rak) made an “opposition inspection visit” to the Metricon Tyrell display house at Craigieburn. A participant (identified as the late Ms Rak) made notes on the visit, which referred to the house’s “Porter Davis style alfresco area”.
On or before 8 April 2003, Susie Fraser, a former employee of Metricon who was enthusiastic about its products, commenced employment with Dennis.
On about 27 April 2003, Ms Wilson produced the Grange 262 and Grange 292 “Draft” plans.
(a)27 April 2003 is the handwritten date on CAD plans of the Grange 262 (which was meat cleaver shaped, with a sala in the rear corner rather than a rumpus room as in the alfresco quadrant, and is not the subject of infringement allegations) and the Grange 292 (with a flush sala windowed on three sides, but showing no roofline) which was never built. No later than 27 April, Ms Wilson provided them to the draughtsman Paul Ciaifa in the form of a brochure plan, which became the basis of more detailed working drawings.
(b)Late April 2003 was the date by which Ms Wilson asserted that she had largely completed the Grange 262 and Grange 291 designs.
(c)On 1 May 2003, Ms Wilson faxed three plans, the Atrium, the Palladium and the Grange 262 to Mr Rowley, who circulated them to Ms Rak and Mr Brigden at the Melbourne office for their comments and provided feedback to Ms Wilson in a telephone conversation.
(d)20 June 2003 is the issue date of working drawings of the earliest documented plan for the Grange 291, the Grange 262 (finalised in a square shape) and the Grange 292 (finalised with a projecting sala).
(e)At a date between 7 May 2003 and 5 August 2003, Mr Rowley, according to his testimony, became aware of the Grange 291 plans.
On 14 May 2003, Rob Carter was appointed Chief Executive Officer of Dennis and, at about the same time, Mr Hofmeyer was appointed National Housing Manager.
For 16 May 2003, Mr Rowley’s diary recorded an appointment in Shepparton and for 27 May 2003, a planned meeting between Mr Rowley and Ms Wilson in Shepparton.
On 4 June 2003, Dennis Metro Design Team employees (including Ms Rak, Mr Brigden and possibly Mr Rowley) made an opposition display visit to the Memphis display and the Metricon Prada display at Cairnlea. Mr Rowley prepared a design report to the Dennis Board in relation to that visit in June 2003.
On 28 July 2003, a new brochure plan for the Grange 262 in final form was produced. On 29 July 2003, the brochure plan for the Grange 291 was produced.
On 19 August 2003, on Mr Rowley’s instructions, Ms Wilson visited the Memphis display site at Rowville.
Throughout August 2003, Dennis “product briefs” were produced. Mr Rowley emailed Ms Wilson and various meetings between Ms Wilson and Mr Rowley were scheduled.
On 11 August 2003, Mr Rowley made his first hand drawn drawing for the Esperance.
At a subsequent unidentified date, Mr Rowley made a second drawing for the Esperance.
On 26-27 October 2003, Mr Rowley made further handwritten drawings for the Esperance and produced marked up CAD drawings of the Esperance.
In November 2003, plans were made to build the Grange 291 as a display in Berwick. The Grange 291 was used to create a plan for the Grange 322 Contemporary.
In April 2004, Mr Rowley marked up a Grange 322 plan.
In May 2004, Mr Rowley visited the Metricon Prada and Barrett Aberdeen display sites at Berwick.
On 7 August 2004, the Grange 322 display site was opened at The Chase, Berwick.
After February 2005, Mr Rowley made the undated first drawings for the Flinders house (then marked “Esperance Mk1”). Between 6 June 2005 and 14 June 2005, Mr Rowley made further drawings for the Flinders house. On 11 October 2005, the final plan for the Flinders 270 was made (albeit inaccurately labelled).
On 18 October 2005, according to Mr Rowley’s evidence, he created the first Thornton 310 drawing by marking up the Grange 322, which became the final Thornton 310 plan.
On 25 January 2006, Mr Rowley created the Flinders 290 and Flinders 310 plans.
On 15 November 2006, the first Thornton 310 house was built at Monbulk.
Both the Seattle and the Memphis designs were very successful. Approximately 640 houses were sold, about 245 of which were Seattle designs. A further 155 houses were sold under the Aberdeen designation, which was a related design.
From May 2002, a large number of homes including an alfresco quadrant were built by Metricon. They were subsequently held to have infringed the Barrett copyright works: see Metricon.
DID THE DENNIS WORKS REPRODUCE A SUBSTANTIAL PART OF BARRETT WORKS
Relevant legislation and legal principles
Section 10 of the Act defines “artistic work” as:
(a)a painting, sculpture, drawing, engraving or photograph, whether the work is of artistic quality or not;
(b)a building or a model of a building, whether the building or model is of artistic quality or not; or
(c)a work of artistic craftsmanship whether or not mentioned in paragraph (a) or (b);
but does not include a circuit layout within the meaning of the Circuit Layouts Act 1989.
It was not disputed that the Barrett plans and houses constitute artistic works within the meaning of subparagraphs (a) and (b) respectively of the definition of that term in s 10 of the Act.
Section 31(1) of the Act provides that:
For the purposes of the Act, unless the contrary intention appears, copyright, in relation to a work, is the exclusive right:
…(b)in the case of an artistic work, to do all or any of the following acts:
(i) to reproduce the work in a material form;
(ii) to publish the work;
(iii) to communicate the work to the public;
Barrett, as owners of the copyright, therefore has the exclusive right to do the above acts for the duration of the copyright specified in s 33 of the Act in relation to the Barrett works.
Section 21(3) of the Act provides:
(3)For the purposes of this Act, an artistic work shall be deemed to have been reproduced:
(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
(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.
Section 21(4) of the Act provides:
The last preceding subsection has effect subject to Division 7 of Part III.
Thus, it was common ground that the Barrett two‑dimensional plans could be reproduced in the form of a three‑dimensional house, and the Barrett houses could be reproduced in the form of two‑dimensional plans.
In S.W. Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 (“S.W. Hart”), Gibbs CJ (with whom Mason J agreed and Brennan J agreed on that issue) stated at 472:
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 LJ in Francis Day & Hunter Ltd v Bron [[1963] Ch 587 at 614], “a sufficient degree of objective similarity between the two works” and “some causal connection between the plaintiffs’ and the defendants’ work”.
In order to establish that any of the Dennis works infringes any of the Barrett works, Barrett must prove first that the Dennis work reproduces in a material form the Barrett work or a substantial part thereof and secondly, that the creation of the Dennis work involved use or copying of the Barrett work.
The requirement of reproduction in a material form of a substantial part, at least, of the copyright work results from the combined effect of s 31(1)(b)(i) of the Act (conferring the exclusive right to reproduce the artistic work in a material form) and s 14(1) of the Act, which states:
(1) In this Act, unless the contrary intention appears:
(a)a reference to the doing of an act in relation to a work or other subject-matter shall be read as including a reference to the doing of that act in relation to a substantial part of the work or other subject-matter; and
(b)a reference to a reproduction, adaptation or copy of a work shall be read as including a reference to a reproduction, adaptation or copy of a substantial part of the work, as the case may be.
As Lindgren J (with whom Finkelstein and Weinberg JJ agreed) stated in Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415 (“Eagle Homes”) at [70]:
The word “reproduce” is not defined in the Act. It has its ordinary meaning of “make a copy, representation, duplicate, or close imitation of” (Macquarie Dictionary) or “repeat in a more or less exact copy; produce a copy or representation of” (New Shorter Oxford English Dictionary). But these definitions prompt such inquiries as how much of the copyright work must be reproduced before it can be said that that “work” has been reproduced and how similar must what is produced be to the copyright work? The effect of s 14(1) of the Act is that the reference in s 31(1)(b)(i) to reproducing an artistic work in a material form includes a reference to reproducing a substantial part of such a work in a material form. In terms, this provision acknowledges a distinction between the undifferentiated whole of a copyright work and a substantial part of it. … Copinger and Skone James on Copyright (13th ed, 1991) para 8-20 states as follows:
“It is unusual for an infringement to consist of an exact copy or use of the whole of the plaintiff's work. In some cases, the defendant's work may to a greater or lesser degree resemble the whole of the plaintiff's work, in which case the question is whether the defendant's work is a colourable imitation. [Sillitoe v McGraw-Hill Book Co (UK) Ltd [1983] FSR 545.] Alternatively, the defendant's work may have been taken from part only of the plaintiff's work. Here, the defendant's work may be an exact reproduction of that part of the plaintiff's work or it may only to a greater or lesser degree resemble that part. In this alternative class of case, the first step is to identify the part of the plaintiff's work which is alleged to have been reproduced and then decide whether it constitutes a substantial part of the plaintiff's work. If it does, but it is not an exact copy of that part, it must then be decided whether it is a reproduction or colourable imitation of that part of the plaintiff's work. [Spectravest Inc v Aperknit Ltd [1988] FSR 161.]”
(emphasis in original)
Lindgren J referred to the statement in Ricketson, The Law of Intellectual Property (1984) at para 9.4, that s 14(1) of the Act, in introducing the concept of a substantial part, addressed the question of the quantum or “how much” of the copyright works or other subject matter must be taken to infringe (at [71]).
His Honour nevertheless observed that the question of how closely a reproduction (if not exact or literal) must resemble the original in order to infringe it directly (at [43]) was more complex, because it could invoke the idea/form of expression dichotomy (at [71]).
Lindgren J stated that in a case of a resemblance between the whole of the copyright and allegedly infringing works, it was necessary to determine whether the alleged infringement was a reproduction or colourable imitation of the former. If, on the other hand, the alleged infringement resembled only a part of the copyright works, it would be necessary to determine whether that part was a substantial part of the copyright works (at [72]).
Further, his Honour recognised that although not expressly stated in the legislation, infringement requires a causal link between the copyright and the infringing works, that is, a use of the original works, excluding from infringement “an accidental and independent reproduction” (at [86]).
As Lindgren J observed in Eagle Homes, copyright law is concerned to protect against “subjective copying”, which can be avoided, whereas an accidental and independent reproduction is unavoidable. Thus, subjective copying will entail infringement unless the subsequent work is so dissimilar that the copyright work can no longer be seen in it (at [86]).
In Eagle Homes, the Full Federal Court allowed an appeal against the decision of the primary judge, who dismissed a project home builder’s allegation that the copyright in its floor plans and homes were infringed by those of another builder. The primary judge found that, despite actual copying, the alleged infringements were not sufficiently similar to constitute a reproduction or a substantial part thereof.
The Full Federal Court concluded that the primary judge had erred by first inferring copying on the basis of “probative similarity”, applying an overly stringent tests for objective similarity, and implicitly “reasoning … that because project home plans were simple drawings of the “commonplace”, lacked “marked originality”, and … share common features, sufficient objective similarity could not exist in the absence of a very close resemblance” (at [85]).
Lindgren J discussed the peculiar difficulties associated with copyright protection for the plans of project homes, arising from their shared common features within the tight parameters of cost, land size and marketplace requirements (at [80]‑[81]). Such common features, in a context of tight constraints, could render it difficult to establish infringement, because despite access by the alleged infringer, the similarities might less readily support an inference of copying. There was thus “an emphasis on the need for close similarity if infringement is to be proved” (at [84]).
Lindgren J concluded (at [91]) that, having once found actual copying, the primary judge in Eagle Homes had erred in emphasising:
… the difficulty of proving infringement in the absence of ‘marked originality’” and the pervasiveness of the commonplace in the plans of project homes. In no case concerning project homes of which I am aware, where there has been a finding of actual copying, has it been held that nonetheless the copies will not have infringed copyright unless there is in addition an extraordinarily close resemblance between his or her drawing and the copyright work. Rather, I think that the issue of sufficient objective similarity simply poses in the cases of project homes, as in other cases, the usual question whether the copyright drawing can still be seen embedded in the allegedly infringing drawing, that is, whether the allegedly infringing drawing has adopted the “essential features and substance” of the copyright works: Hanfstaengl v H R Baines & Co Ltd & Mansfield [1895] AC 20 at 31 (Lord Shand) …
Lindgren J observed that at [98]:
The two elements of “causal link” and “sufficient objective similarity” are not referred to in the Act and are but aspects of “reproduction”. The two are interrelated and it can be artificial to consider them separately, at least in a case like the present one where actual copying is found to have occurred. A finding of copying can add significance to objective similarity …
Lindgren J stated that although the two elements of subjective copying and sufficient similarity were distinct matters to be proved by the copyright owner, “there may be overlap between them. For example, if proof of copying cannot be established directly (for example, by admissions), it will be necessary to prove it by inference. As noted earlier, this is usually done by showing that the defendant had access to the protected material and that the allegedly infringing work is so similar to it to give rise to an inference of subjective copying in preference to other explanations. That is, there will be cases where the similarities between the protected material and the allegedly infringing material are so persuasive that in substance the same evidence will justify an inference of subjective copying and will establish sufficient objective similarity”: at [101].
Lindgren J considered (at [102]) that “the rough practical test” expressed by Peterson J in University of London Press Ltd v University Tutorial Press Ltd [1916] 2 Ch 601 at 602, that “what is worth copying is prima facie worth protecting”, should not be taken too far and a proper reading of the evidence was always required.
Substantial Part
In the present case, it is not alleged that any of the Dennis works either exactly or totally reproduced any of the Barrett works. The allegation of infringement relates only to the alfresco quadrant area of the Barrett works. Further, it is not alleged that the Barrett alfresco quadrant area is exactly reproduced in any of the Dennis works, which are acknowledged to include a number of different features and details.
Therefore, in determining whether any of the Dennis works constitutes an infringement of any of the Barrett works, it is necessary to decide whether the alfresco quadrant is a substantial part of the Barrett works, and if so, whether there is a sufficient objective resemblance between the Barrett and Dennis works.
It has been long established that the substantiality of the relevant part of a copyright work is determined by reference to its quality, rather than its quantity.
In Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273 (“Ladbroke”), Lord Pearce stated at 293:
Whether a part is substantial must be decided by its quality rather than its quantity. The reproduction of a part which by itself has no originality will not normally be a substantial part of the copyright and therefore will not be protected. For that which would not attract copyright except by reason of its collocation will, when robbed of that collocation, not be a substantial part of the copyright and therefore the courts will not hold its reproduction to be an infringement. It is this, I think, which is meant by one or two judicial observations that “there is no copyright” in some unoriginal part of a whole that is copyright.
It is trite law that copyright protects not ideas but the form of their expression, albeit the dichotomy may be difficult to draw in practice when applied to some subjects. As Gilmour J recognised in Metricon, some subject matter may be so simple and the scope for expression so narrow that the idea and the form of expression essentially coincide, thus precluding copyright protection. Gilmour J referred to the old case of Kenrick and Co v Lawrence and Co (1890) 25 QBD 99 (“Kenrick”) as an illustration of that extreme.
His Honour stated (at [13]):
The application of copyright law to project homes and designs is not without difficulty. The competing concepts in copyright law of “ideas” and “expression of ideas” underpin the difficulty: Kenrick … provides an apt illustration. In that case, the author had printed a card that assisted illiterate voters. The card’s design was simple. The design depicted a hand holding a pencil in the act of completing a cross within a square. Willis J held that the copyright protection sought would protect the idea rather than the expression alone, since “a square can only be drawn as a square, a cross can only be drawn as a cross, and for such purposes as the plaintiff’s drawing was intended to fulfil, there are scarcely more ways than one of drawing a pencil or the hand that holds it”: Kenrick at 104. The case is an extreme example, but gives expression to the idea-form dichotomy.
In Eagle Homes, Lindgren J observed that a very simple depiction of a simple subject, as in Kenrick, posed the danger of an impermissible protection of ideas (so that nothing short of an exact and literal reproduction could constitute an infringement). His Honour observed, however, that project home plans differed from the Kenrick example, because they did not represent a pre‑existing object, and there remained, despite the external constraints, scope for the individual expression of a concept through the application of skill, judgment and labour.
As the authorities recognise, the difficulties of applying the idea/form of expression dichotomy are exacerbated by the requirements and constraints peculiar to designing project homes.
In Tamawood Ltd v Henley Arch Pty Ltd (2004) 61 IPR 378 (“Tamawood”), the majority (Wilcox and Lindgren JJ) stated that “[t]he idea-form distinction, often elusive, is particularly so in the case of project homes” (at [39]). The majority recognised that project homes incorporated common features or amenities demanded by the market and functional requirements logically necessary to the efficient operation of the house, such as the reasonable proximity of a kitchen to a dining room.
The majority in Tamawood accepted that standard external constraints, necessary standard amenities and functional requirements could blur the dividing line between ideas and the form of their expression. A placement or proximity suggested by functional requirements (for example, the need for a kitchen to be near a dining room) would constitute an idea and could not be seen as a substantial part of the plan as an artistic work. Nevertheless, there could be scope for satisfying the broad functional requirements in a variety of ways or for aesthetic or decorative features requiring the application of labour, skill and judgment.
The majority stated (at [55]-[56]):
Nor do we accept Henleys’ submission that any part of a work which, considered in isolation, satisfies the low threshold of originality for the purpose of the subsistence of copyright, will necessarily constitute a substantial part of that work for the purpose of infringement. The reason is that it is not infringement of the part, but infringement of the whole that is in question. Whether there has been an infringement of the whole requires that the originality of the part be considered in relation to the work in suit as a whole. It must be determined whether the part is an “essential or material” feature of the whole work, regarded as a copyright work, in the present case, as an artistic work. In our opinion, it must be asked whether the part or parts taken represent a substantial part of the labour, skill and judgment of the author that made the whole work “original”. Factual questions of degrees of “significance” or “importance” of the part to the whole are involved.
In applying the “substantial part” test in the present case, one must bear in mind that the plan for a project home is partly functional. Placing a kitchen in reasonable proximity to a dining room, and bedrooms in reasonable proximity to each other and to a bathroom, is suggested by broad functional considerations. Those proximities would not be a substantial part of a plan or house regarded as an artistic work. Moreover, they would be ideas. But broad functional requirements can be satisfied in more ways than one. Some features of a project home plan may be dictated by aesthetic and decorative concerns, for example. In these ways, the labour, skill and judgment of the author are called upon. The dividing line between that which is dictated by broad functional requirements and that which is not, is, however, often unclear.
(emphasis in original)
The application of sufficient labour, skill and judgment in combining commonplace features may, even in the context of project home plans, attract copyright protection. Conversely, where the originality lies in the combination or arrangement of individuality commonplace components, using such a component of a work, which secured copyright protection only as a total collocation, would not infringe.
The same test for originality applies to the work as a whole and the assessment of a substantial part. While on one view the High Court majority in Autodesk Inc v Dyason(No 2) (1993) 176 CLR 300 (“Autodesk”) contemplated that even a non‑original part of a computer program might be relevantly substantial if the program would not operate without it, Mason CJ (dissenting) stated at 305:
… [I]n determining whether the quality of what is taken makes it a “substantial part” of the copyright work, it is important to inquire into the importance which the taken portion bears in relation to the work as a whole: is it an “essential” or “material” part of the work?
…[I]n the context of copyright law, where emphasis is to be placed upon the ‘originality’ of the work's expression, the essential or material features of a work should be ascertained by considering the originality of the part allegedly taken. This is particularly important in the case of functional works, such as a computer program, or any works which do not attract protection as ends in themselves (eg, novels, films, dramatic works) but as means to an end (eg, compilations, tables, logos and devices).
In Data Access Corporation v Powerflex Services Pty Ltd (1999) 202 CLR 1 (“Data Access”), the majority (Gleeson CJ, McHugh, Gummow and Hayne JJ) preferred Mason CJ’s dissenting judgment in Autodesk and maintained the traditional originality requirement. Their Honours stated (at [85]) that “the originality of what was allegedly taken from a computer program must be assessed with respect to the originality with which it expresses that algorithmic or logical relationship or part thereof.”
In Tamawood, Wilcox and Lindgren JJ at [54] stated:
We do not accept Tamawood’s submission that in Data Access the High Court intended to lay down a new test of ‘substantial part’. Autodesk and Data Access concerned computer programs. Every digit in a computer program is essential to the successful operation of the program. The High Court was concerned in those cases to reject the notion that this meant that every such part also necessarily constituted a substantial part of a computer program regarded as a literary work for copyright purposes.
(emphasis in the original)
If a respondent takes an original part of the copyright work, liability for infringement is not avoided because the part taken is not quantitatively or a qualitatively substantial part of, or important to, the respondent’s work. Thus, in Designers Guild Ltd v Russell Williams (Textiles) Ltd t/as Washington DC [2001] 1 All ER 700, Lord Millett at 709 said that, once copying had been established:
…the question is whether what has been taken constitutes all or a substantial part of the copyright work. This is a matter of impression, for whether the part taken is substantial must be determined by its quality rather than its quantity. It depends upon its importance to the copyright work. It does not depend upon its importance to the defendants' work, as I have already pointed out. The pirated part is considered on its own (see Ladbroke (Football) Ltd … at 293 per Lord Pearce) and its importance to the copyright work assessed. There is no need to look at the infringing work for this purpose.
In Metricon, Gilmour J considered in detail the principles governing copyright in project homes and the difficulties of their application, both generally and in relation to the Barrett Seattle and Memphis plans and houses. Gilmour J adopted the analysis in Tamawood, supra. His Honour added (at [22]) that “[e]mphasis on quality rather than quantity is further exemplified in more recent Australian authorities” and quoted Mason CJ’s dissent in Autodesk.
Gilmour J then added:
[23] While the High Court’s holding in Powerflex applied to a computer program, the passage is of general application. In any event, a common thread in a case which involves computer programs and one which involves project homes, is that the copyright may overlap with functional considerations.
…
[27] Accordingly, three interrelated and overlapping issues arise in determining whether in this case, infringement is made out as to a substantial part of the applicants’ works:
•first, the court must identify the part of the applicants’ works which is alleged to be reproduced and then decide whether it constitutes a substantial part of the applicants’ works as a whole;
•second, the court is required to compare the substantial part of the applicants’ work with the respondent’s works and assess whether there is a sufficient objective similarity between the works; and
•third, the court must determine whether the substantial part of the applicants’ works identified has been used to derive the respondents’ works.
[28] While the above considerations are, typically, considered in a cumulative sense, I will address each of them in turn.
On appeal from, inter alia, Gilmour J’s holding that Metricon had reproduced a substantial part (identified as the alfresco quadrant) of the plan for the Seattle house, the Full Federal Court stated in Metricon Homes Pty Ltd v Barrett Property Group Pty Ltd (2008) 75 IPR 455 (at [42]-[43]):
It is trite that the dominant principle of copyright law is that protection is given, not for ideas, but only for the form of expression. … Copyright cannot subsist in the idea of a house with an alfresco quadrant to the side of the back portion of the house. However, copyright can subsist in a plan that reflects that idea for a house. Whether it does or not will depend on whether the plan is an original artistic work within the meaning of s 32(1) of the Act. The plan will be an original artistic work in the statutory sense if it is recognisably the author’s own work as opposed to a copy of another’s work or a trivial variation on another’s work…
In this case the Metricon Parties conceded that copyright subsists in the Copyright Works. They thereby conceded that the Copyright Works were original artistic works within the meaning of s 32(1) of the Act. Their reliance on evidence which tended to show that the arrangement of a rumpus, family, kitchen and meals room around a courtyard or patio to the side of a home was commonplace in the industry sits uncomfortably with this concession.
After referring (at [44]) to the dissenting judgment of Mason CJ in Autodesk at 305, their Honours continued (at [45]-[46]):
We note, incidentally, that while neither a house plan nor a constructed house is exactly a "functional work" of the kind identified by the Chief Justice in the above passage from Autodesk Inc v Dyason (No 2), a project home is nearer in concept to a "functional work" than the types of work with which his Honour drew a contrast. That is, a project home is more of a ‘functional work’ than a novel, film or drama, which necessarily attracts copyright protection. We therefore conclude that in determining whether the quality of what is taken from a plan for a project home in which copyright subsists makes it a "substantial part" of the copyright work it is important to consider the originality of the part allegedly taken.
This is the approach adopted in Tamawood …
The High Court refused special leave to appeal in Metricon v Barrett Property Group Pty Ltd [2008] HCTrans 277.
Was the alfresco quadrant a substantial part of the Barrett works?
In the present case, Barrett submitted that the alfresco quadrant was relevantly original and a substantial part of the copyright works because:
(a)the arrangement or relationship of the individual areas to each other is significant: it would be incorrect to disaggregate each area and to consider it on its own;
(b)in particular, the alfresco is a key feature of the arrangement, with the meals, family and rumpus areas opening on to it on three sides;
(c)the kitchen is important, being at the hub of the design aspects of the Alfresco Quadrant; and
(d)the grouping of these elements under the one roofline (a feature of considerable functional importance, but one that has even more pronounced visual significance in the house claims…).
Barrett submitted that despite the variety of ways available to express the above elements in a house plan, no examples of the “prior art” in evidence contained an alfresco quadrant like that in the plans at issue in this case. No previous plan “showed the precise combination of features using the simple and inexpensive roofline”. The quality of the alfresco quadrant, its overall placement, presentation of features, their visual interrelationship, the floor layout in the overall context and the single rear roofline were all significant.
Dennis disputed that “the alfresco quadrant” constituted a substantial part of the Barrett copyright works. It submitted that the subsistence of copyright in the Barrett works, which it conceded, required only a low level of originality. The Barrett alfresco quadrant was, however, neither novel nor remarkable and did not constitute a substantial part of the Barrett works. Dennis submitted that Barrett exaggerated both the distinctiveness of its alfresco quadrant, and its importance in the context of the Seattle and the Memphis plans and houses as whole.
The above Dennis witnesses (including Mr Hofmeyer and Ms Wilson, who were independent in the sense that they were no longer employed by Dennis) professed a complete inability to remember many matters which were highly significant to the present dispute, but asserted a selective recollection of matters supportive of Dennis’ case. Their evidence was to the effect that:
(a)Ms Wilson did not have any effective opportunity for direct access to the Barrett works prior to designing the Grange plans;
(b)Although Mr Rowley and other Melbourne based Dennis staff had the opportunity for and in some cases proven access to the Barrett works, they had little or no interest in or awareness of competitors’ designs. Further, they had little opportunity to, and did not, transmit any relevant awareness, information, material or instructions concerning the Barrett works to Ms Wilson prior to or during her design of the Grange houses; while Mr Hofmeyer regularly travelled between Shepparton and Melbourne, initially on a monthly basis, he gave Ms Wilson only general instructions in relation to her design work; and
(c)Ms Wilson and Mr Rowley, in any event, produced their respective Dennis designs by pathways independent of the Barrett works.
Ms Wilson, while unable to recall the process of designing the Grange plans at all, was confident that at the time she was unaware and made no use of the Barrett works.
She did not mention her visits to Metricon houses with Ms Fraser in her written evidence and could not recall the dates or details of the visits in cross‑examination, but recalled, implausibly in my view, that they were directed only at specification items such as taps, rather than design.
Ms Wilson’s assertion that, although an experienced and skilled designer, she did not notice the similarities between the Memphis alfresco quadrant and that of the Grange 291 when she inspected the Memphis in August 2003 was also, in my opinion, improbable and unconvincing.
Mr Rowley deposed that in December 2008, when he prepared his first affidavit, he had completely forgotten the formal programme of opposition display visits he personally instituted in early 2003, in which he participated and on which he both received and prepared written reports. His claimed recollection that the visits were directed only at specification items and presentation was, given his related memory loss, unpersuasive. Despite the passage of time between the events of 2003 and the preparation of his first affidavit in this matter, it was surprising that Mr Rowley would entirely forget a formalised programme of inspecting competitors’ display houses that he personally devised, given its importance to the issues in dispute. Mr Rowley’s explanation for his failure to make timely discovery of the relevant diary entries, review reports and reports to the board was also, in my opinion, unsatisfactory, as comprehensive inquiries should have been made for the purposes of discovery.
While, as Dennis submitted, Mr Rowley did not categorically deny his access to Barrett houses, his evidence about his familiarity with Porter Davis and access to Barrett works was, in my opinion, calculating and evasive, rather than frank.
Mr Hofmeyer’s evidence did not disclose some significant realities of the prevailing context and his own role within it. His affidavit neither mentioned that he was appointed Acting Chief Executive Officer of Dennis in January 2003 nor acknowledged the concurrent important developments in the Dennis corporate structure, business environment and goals requiring, inter alia, nationalisation and renewal of design, against which backdrop Mr Hofmeyer instructed Ms Wilson to produce the series of new designs which included the Grange plans.
Although Mr Hofmeyer acknowledged those matters in cross‑examination, he did not satisfactorily explain their omission from the written evidence. Mr Hofmeyer could not recall the 2003 Metro design team opposition visits, or a number of business objectives and problems noted as significant in contemporaneous board papers or reports. He nevertheless recalled that in 2003 he had no knowledge that alfrescos were used in Melbourne, or that Metricon and Porter Davis were selling large numbers of houses which included that feature. I considered it improbable that Mr Hofmeyer was unaware of such matters in 2003, given his total inability to recall other related matters, his central leadership position in the Dennis organisation at the time, the references to Porter Davis and associated features in board papers he received, and Mr Denison’s evidence (supported by that of industry sales staff) that the success of the Barrett houses containing an alfresco was well known in the industry at the time.
Mr Brigden was an unimpressive and unresponsive witness, whose assertion of purpose for meetings he acknowledged that he could not recall was self‑serving and unpersuasive. Mr Brigden’s evidence related to a limited issue. His total lack of recall of any visits he participated in, and professed lack of any knowledge of a Porter Davis style alfresco or features, suggested, however, a lack of candour.
There was force in Barrett’s submission that the affidavits of Ms Wilson, Mr Rowley, Mr Brigden and Mr Hofmeyer, taken together, presented a sanitised and selective version of the antecedents of and context in which the Dennis plans were produced.
Contrary to the contemporaneous documents, including those produced only shortly before or during the trial, the affidavits gave no indication that in early 2003, the Dennis business was undergoing a restructure in order to address urgent problems in meeting market demand for, inter alia, renewed or more innovative designs and to make up ground lost to competitors. Instead, the written evidence depicted a stable Dennis corporate organisation and culture which was essentially unchanged when Ms Wilson designed the Grange 262 and Grange 292 plans in late April 2003, and where the Regional and Melbourne design and other staff continued, in practice, to operate separately, with little or no interchange or cross‑fertilisation between either the design staff of the different divisions or between design and sales staff generally. The written evidence indicated that despite the acknowledged introduction in January 2003 (under Mr Rowley’s leadership) of the National Design Team, which Ms Wilson joined at an unspecified point in 2003, divisions persisted until considerably later and Ms Wilson’s effective participation in national design work did not begin until at least mid 2003.
The written evidence also maintained that Dennis designers, including Mr Rowley and Ms Wilson, were largely indifferent to the designs and market success of their competitors both prior to and during the creation of the Grange designs.
In cross‑examination, Mr Rowley, consistently with that evidence, while conceding that he met Dennis sales staff, denied that he received feedback about designs from them. At one point, Mr Rowley asserted, most implausibly, in my opinion, that as head of Dennis he had no interest in, awareness or monitoring of, competitors’ designs or commercial success, but “operated in a complete vacuum”. Ms Wilson also maintained that although she met sales staff, she did not receive feedback on the popularity of designs from them. It is probable, however, on the evidence, that well before April 2003, interchange about, inter alia, successful house designs occurred between volume building industry competitors’ display site staff, with a likelihood of resultant feedback from Dennis sales staff to designers and other Dennis staff.
Dennis did not dispute that, for a considerable time prior to April 2003, Dennis Metro design and other staff had ready opportunity for access to the Barrett works or relevant infringing works through a variety of means, including their public exhibition in display villages situated at various locations throughout outer Melbourne, or related brochures, plans and advertisements published in The Herald Sun Property Guide (a publication taken by the Metro division) or elsewhere. Dennis did not dispute that from August 2002, photographs of the Memphis, including the alfresco quadrant, were stored on the Dennis computer network (although Mr Rowley deposed that they could not be directly accessed by Regional Division computers as at April 2003).
I am not persuaded that Mr Rowley and Dennis design staff generally were, prior to April 2003, largely indifferent to competitors’ designs and products and consequently, despite the available opportunities for access, lacked detailed awareness of the Barrett works.
In my opinion, the evidence established that well prior to 2003, Dennis design staff, as the witnesses to some extent acknowledged, inspected, monitored and were aware of competing builders’ products. They also maintained a degree of contact and communication about design between the different divisions. Further, the evidence established that prior to 2003, Ms Wilson had some opportunity for direct personal inspection of the Barrett works or infringing houses.
Prior to 2003, Mr Hofmeyer directed Ms Wilson to view Queensland Dennis houses with Mr Rowley and other staff in order to gain design inspiration. He made clear his admiration for the sala, which she promptly thereafter incorporated into a design. Mr Hofmeyer also, occasionally at least, brought back from his regular visits to Melbourne Metro designs for Ms Wilson to adapt and copies of The Herald Sun Property Guide.
Prior to 2003, Mr Rowley also occasionally met Ms Wilson in Melbourne, Shepparton. They thus had opportunities to discuss design during the period when the Barrett houses and third party builders’ infringing houses were exhibited in the Melbourne area, sometimes adjacent to Dennis display sites, the opening of which Mr Rowley acknowledged he typically attended. The evidence established that Henley sales staff were highly aware of the nearby Barrett houses’ strong customer appeal and considerable commercial success. The evidence also established the tendency of display village sales staff in the volume housing industry to meet and exchange information with their competitors. It is probable that Dennis sales staff were, like the Henley staff, aware of the success of the Seattle and Memphis houses on display near their own display sites.
Mr Denison agreed that “other players in the industry” would have noticed the very substantial success of the Seattle and Memphis in 2000, which created a “very noticeable market presence”. He conceded that during 2003, he saw Metricon as a key competitor and that Porter Davis staff themselves informed him of their market success.
In August 2002, around the time of a Dennis national conference attended by a large contingent of Shepparton staff, there was sufficient interest in the Memphis within the Dennis organisation for a member of the Dennis design staff to take photographs of it, including shots of the alfresco quadrant, which were thereafter stored on and available from the Dennis computer network. The notes of the Dennis Design Team’s inspection of the Cairnlea Porter Davis Memphis display house on 4 June 2003 compared a lack of progress with two years earlier, thereby indicating the author’s awareness of the Barrett’s display at Ferntree Gully as long ago as mid 2001.
Ms Wilson could not recall participating in the 2002 inspection of display houses in Melbourne or the meeting with Mr Rowley that preceded it, even when taken to a contemporary email exchange. Mr Rowley deposed that he arranged the trip so that the Shepparton designers could observe Dennis Melbourne display sites and, while conceding that the party may have visited Rowville, denied that they visited the adjacent Porter Davis Memphis display. He conceded, however, that he was not present for the entire trip. I was not persuaded that the offer in Mr Rowley’s email to provide Ms Wilson with brochures established that the Dennis personnel viewed only Dennis houses.
Contemporaneous documents produced only at a late stage of the litigation established that by late 2002 to early 2003, Dennis had resolved to restructure its business organisation and policies to achieve an urgent turnaround in lost market and competitive ground. The business was experiencing significant problems. All divisions were performing below budget, Triline significantly so. There was a decline in sales, and the Dennis product was perceived as “not cutting the mustard” and the Executive Division as “bleeding to death”. Ms Wilson conceded that at the time, she regarded the Dennis designs as plain, dated and boring.
From January 2003, the process of inspection and monitoring of competitors’ products and the interchange between Dennis design staff was formalised in response to the pressing business problems which had emerged. Mr Hofmeyer was appointed Acting Chief Executive Officer, a position which placed him at the heart of the organisational response and involved him in more frequent travel between Melbourne, Shepparton and other locations.
As a part of the reorganisation, Mr Rowley was appointed head of a National Design Team. Documents which were not produced until shortly before trial revealed that Mr Rowley then instituted the structured program of design team visits to review competitors’ display sites (including the Barrett works and infringing Metricon houses) which actively commenced in March 2003. The visits were recorded in detailed notes. The opposition display visit programme, which was not mentioned in Mr Rowley’s first affidavit, rendered untenable the view that Dennis design and other staff were, immediately prior to and during the design of the Grange houses, generally indifferent to and largely unaware of competitors’ designs and products. The reports of the visits documented extensive examination of the features of the relevant houses, including design. They indicated, as stated above, a previous inspection of the Ferntree Gully Barrett display up to two years prior to 2003.
The reports did not, on a fair reading, reflect an interest limited to specification items, presentation, outside areas or landscaping. A stated aim of the opposition display visits programme was to avoid designing in isolation and the reports reflected a sustained active interest in the products of the relevant competitors, extending to design. While there is no indication that the visits targeted any particular feature or of their length, the reports reflected a serious and detailed general examination which was clearly more than a fleeting survey.
Mr Rowley prepared corresponding reports on design to the board, conceded that he intended to disseminate the information gained from the visits and acknowledged his own participation in a visit to a Metricon display site containing an infringing Tyrell houses on 2 April 2003.
I am satisfied that by early 2003, Mr Rowley and various other members of the Dennis design team were aware of the Barrett designs and their commercial success.
Further, I am persuaded that Mr Hofmeyer, given the prevailing corporate context and his own central position, was, at the time, aware of the Barrett designs and their popularity, which, as Mr Denison acknowledged, would have been very noticeable to those in the industry.
Ms Wilson became a member of the National Design Team in 2003. The precise date of her formal membership was not established. Dennis contended that her active participation did not begin until at least mid 2003, well after Grange plans were essentially completed and after the first documented exchange about her designs with Mr Rowley on 1 May 2003. I am satisfied, however, that prior to 27 April 2003, interchange and communication between Ms Wilson and Melbourne Dennis design or other staff who had direct access to the Barrett works had already occurred.
By early April 2003 at the latest, Ms Fraser, who was obsessed with Metricon and pressed Dennis staff to visit Metricon display houses, had commenced her employment with Dennis. According to Ms Wilson, Ms Fraser accompanied Ms Wilson and perhaps Mr Rowley on an indefinite number of inspections (the precise dates of which Ms Wilson could not recall) of Metricon display houses (the precise identity of which Ms Wilson could not recall). I was not persuaded that such visits post‑dated the design of the Grange houses or that their purpose was limited to viewing specification features. Further, in cross‑examination, Ms Wilson ultimately expressly conceded that she commonly liaised with Metro design staff about her designs and at the time she was designing the Grange houses, contrary to the impression created by her affidavit, she was also “definitely” in communication with Mr Rowley, Ms Rak (who took the notes of the opposition display site visits) and a committee of Metro staff. I do not accept that such communication was limited to specification or presentation issues. Mr Hofmeyer also, at the relevant time, travelled more frequently between Melbourne and Shepparton. Despite his lack of recall, I am persuaded that, at that time, Mr Hofmeyer read the design reports to the Dennis board, was conscious of the urgent business goals, including the need to introduce more innovative designs, and was aware of and approved the design team’s competitor display site visits. There was thus opportunity, capacity and incentive for Mr Hofmeyer to transmit or communicate material or instructions to Ms Wilson prior to her completion of the Grange draft designs.
I am satisfied on the balance of probabilities that, although it is not possible to identify the precise means, Ms Wilson, contrary to her denial, had access to and awareness of the Barrett works, or the infringing plans or houses of other volume builders which relevantly reproduced the Barrett works, prior to and during her production of the Grange 291, whether by her own visual inspection of the Barrett houses, infringing houses, brochures, advertisements, plans or photographs, or more indirectly, through instructions or descriptions transmitted or conveyed to her by others who had access to the works in Melbourne. Further, I am satisfied that Ms Wilson copied or made use of the Barrett works in designing the Grange plans. In this context, the questions of objective similarity and copying overlap. In summary, I infer Ms Wilson’s access and copying from the totality of the facts and circumstances, including the following principal matters:
(a)The opportunities for and actual access by Dennis staff to Barrett works or intermediate versions of them prior to 2003, and the opportunities for transmission of materials and information to Regional staff;
(b)The Dennis corporate restructure and business context in early 2003, where the renewal of design to meet the market was one of a number of pressing business goals;
(c)The appointment in January 2003 of a National Design Manager and formation of a National Design Team, to which Ms Wilson belonged and with some members of which she frequently liaised by April 2003;
(d)The institution in early 2003 of the formal program of visits and detailed scrutiny of competitors’ houses (including, on 2 April 2003, the Metricon Tyrell) by members of the Dennis Metro design team, including Mr Rowley, the reports on which reflected a past familiarity and present awareness of the Barrett alfresco area and other features;
(e)Ms Wilson conceded that she participated in visits to competitors’ display houses which she could not recall, at dates she could not remember, with Ms Fraser, who commenced employment with Dennis by early April 2003, was obsessed with Metricon and urged staff to view Metricon houses;
(f)Ms Wilson conceded that she commonly liaised with Metro design staff and, at the time of designing the Grange houses, she was “definitely” in communication and interchange with Mr Rowley and other design team members, including Ms Rak, Mr Hofmeyer and a “committee” of Dennis staff;
(g)By the time Ms Wilson designed the Grange 291, photographs of the Memphis house and its alfresco quadrant were, and had been for months, stored and available on the Dennis computer network;
(h)Ms Wilson was, as she conceded, in possession of the brochures and plans of other builders, the identity of which she could not recall;
(i)Ms Wilson was an experienced and capable designer, with the ability to absorb the features of the Barrett works from a relatively transient inspection or indirect instructions;
(j)In March 2003, in the context of the restructuring, Ms Wilson was instructed by Mr Hofmeyer to inspect housing in Perth and to produce a considerable number of new designs to meet requirements and, by a facsimile dated 1 May 2003, submitted the plans on which she was working to Mr Rowley for approval, comment and circulation to the design teams;
(k)The strong objective similarity and visual resemblance between the alfresco quadrant of the Grange 291 and that of the Barrett works, in which the alfresco quadrant was arranged differently from any prior work, and which was the product of considerable skill and labour;
(l)Ms Wilson was completely unable to recall the process of designing the Grange houses and many circumstances leading up to or surrounding it, such as the identity of houses she visited with Ms Fraser or the relevant dates. I have referred above to the lack of candour, inconsistency and other unsatisfactory features of Ms Wilson’s testimony. Despite the passage of time, her total absence of recollection was, in my view, surprising, particularly when contrasted with her certainty that she did not make use of Barrett works. Ms Wilson’s total lack of memory of the design process further attenuated her disavowal of awareness or making use of, or receiving details or instructions related to, the Barrett works or intermediate or infringing versions thereof;
(m)Ms Wilson was unable to posit a credible alternative design path for the Grange plans, including the Grange 291. She did not strongly press and did not assert that she independently identified the Dennis designs to which she referred in her affidavit as constituents of “the furniture of her mind” in the genesis of the Grange designs;
(n)The Grange 291 included some features similar to those previously used by Ms Wilson in other Dennis designs or in houses she viewed in Perth, and senior counsel for Dennis submitted that, for example, the addition of a rumpus room to plans with which Ms Wilson was familiar indicated that relevant aspects of the Grange 291 were merely a logical progression. The inclusion of features which were not copied could not, however, negate the fundamental similarity of the alfresco quadrants of the Seattle and the Grange 291. Further, Ms Wilson, who was herself critical of existing Dennis designs, did not describe a design pathway from any particular plan or demonstrate the application of the furniture of her mind to the production of the Grange designs.
(o)In the expert opinion of Dr Cooke, the nominated Dennis designs were not links in the Grange design chain.
(p)While Ms Wilson’s failure to preserve any record at all of her design process and work‑up was in great contrast to the practices of the Barrett designers, Barrett did not challenge the evidence that she created designs without making any hand‑drawn sketches, instead using CAD software and successively deleting the penultimate electronic drawing of each design when amending it. There was no evidence of a uniform industry practice of preserving records of the design process or work-up. Therefore, in itself, the absence of any documentary record of the design record did not reflect adversely on Ms Wilson’s credit. Nevertheless, as Weinberg J observed in Inform Design, both the credibility of the respondent designers in that case, and the contemporaneous documentation showing the development and evolution of their plans, persuaded him to accept their assertions of independent creation. In the present case, when Ms Wilson’s total lack of memory of the design process was combined with a complete absence of a documentary record of her design work up and other relevant circumstances, including credit, it rendered her assertion of an independent design pathway for the Grange untenable.
In my opinion, it is highly improbable that Ms Wilson independently produced, within a short space of time, without any specific genesis, identified lineage or demonstrated work‑up, a house plan incorporating an alfresco quadrant strongly resembling that of the distinctive and successful Barrett works (the creation of which, on unchallenged evidence, involved a prolonged and laborious design process).
I therefore conclude that Ms Wilson had access, either direct or indirect, to the Barrett works through one or more of the opportunities presented by the corporate context and activities described above, and did in fact make use of or copy them to produce the Grange 291, which therefore infringed Barrett’s copyright in the Barrett works.
Barrett invited me to find that Ms Wilson may have made unconscious use of the Barrett works, while Dennis asserted that I should find that she copied them deliberately or not at all.
The authorities recognise the possibility of unconscious copying: Francis Day & Hunter Ltd v Bron [1963] Ch 587; Clarendon Homes at [24]. Infringement of copyright does not require deliberate copying or a consciousness of wrongdoing. I have expressed an unfavourable view of Ms Wilson’s testimony and there is, due to her absolute inability to recall designing the Grange plans, a vacuum in the evidence on her accompanying state of mind. The cases recognise that the subconscious copying of architectural plans is likely to be unusual. In the circumstances, I consider it improbable that Ms Wilson’s use of the Barrett works was unconscious.
It follows that, as the Grange 322 and Thornton 310 were created largely by Mr Rowley through adapting the Grange 291, and given the strong visual similarity of their alfresco quadrants (from which the addition of a projecting sala in the Grange 322 did not, in my opinion, fundamentally detract), the Grange 322 and Thornton 310 were likewise derived from the Barrett works rather than independently created, and thus infringed Barrett’s copyright.
It was established that Mr Rowley, in contrast to Ms Wilson, prior to designing the relevant Dennis works, had direct access to a Grange draft and the Metricon Tyrell by late April 2003, in addition to the many other opportunities for access to the Barrett works, whether in display sites or by other more indirect means available in the corporate and industry milieu described above.
In my opinion, for the reasons set out above, Mr Rowley was not a credible witness. His evidence generally was unreliable and inconsistent. In particular, his explanation of his creation of the Esperance, from which the Flinders series of house plans was derived, was not plausible.
The Lexton B3, which Mr Rowley identified as the genesis of the Esperance (from which the Flinders series of houses was derived), did not have an alfresco quadrant. Although Mr Rowley maintained a design file, it contained only several concept sketches in relation to the creation of the Esperance. The sketch Mr Rowley identified as the very first sketch of the Esperance already included an alfresco quadrant, which Mr Rowley testified he had already worked out. Dr Cooke observed no evidence of tracing, and although Mr Rowley was familiar with the Lexton B3, Dr Cooke stated that tracing is common when a new plan is created by modifying an existing plan. There was nothing in the sketches to demonstrate either that the Lexton B3 was the starting point of the Esperance or how the Esperance sketches developed from the Lexton B3. Dr Cooke considered, and I accept, that that the Esperance was not derived from the Lexton B3, but was probably produced with reference to the Grange 291, as it shared the distinctive alfresco quadrant fundamentally similar to that of the Barrett works.
I therefore conclude that Mr Rowley made use of or copied the Barrett works, directly or indirectly, to produce the Esperance, Thornton 310 and Flinders plans.
CONCLUSION
In my opinion, the applicants’ claims of infringement are established and they are accordingly entitled to relief. I shall invite submissions in relation to the form of orders and further directions in this proceeding.
I certify that the preceding five hundred and seventy nine (579) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dodds‑Streeton. Associate:
Dated: 18 March 2011SCHEDULE
Seattle 31
Memphis 33
Grange 291
Grange 322 (a)
Grange 322 (b)
Thornton 310
Esperance
Flinders 270
Flinders 290
Flinders 310
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