Delstrat Pty Ltd T/a Seacrest Homes v Bond

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: DELSTRAT PTY LTD t/as SEACREST HOMES -v- BOND & ORS [2004] WADC 55

CORAM: KENNEDY CJDC

HEARD: 16-18 JUNE, 24-26 NOVEMBER & 10 DECEMBER 2003

DELIVERED : 1 APRIL 2004

FILE NO/S: CIV 1684 of 1999

BETWEEN: DELSTRAT PTY LTD t/as SEACREST HOMES
Plaintiff
AND
GRAHAM BOND
CAROLYN BOND
First Defendants
DENNIS PETER FRANCESCONI
LYN MARIE FRANCESCONI t/as HILLCREST HOMES
Second Defendants

Catchwords:

Copyright - Infringement of - House plans of designer/builder taken by client, used by another builder - Licence - Estoppel - Damages

Legislation:

Copyright Act 1968

Result:

Judgment for the plaintiff against the defendants in the sum of $30,000 and further against the first defendants of exemplary damages of $8,000

Representation:

Counsel:

Plaintiff:     Mr P P McCann
First Defendants           :     Mr P J Marsh
Second Defendants       :     Mr P J Marsh

Solicitors:

Plaintiff:     Hotchkin Hanly
First Defendants           :     Formbys Lawyers
Second Defendants       :     Formbys Lawyers

Case(s) referred to in judgment(s):

Fenning Film Service Limited v Wolverhampton Walsall & District Cinemas Limited [1914] 3 KB 1171
Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales (1975) 6 ALR 445
Milwell Pty Ltd v Olympic Amusements Pty Ltd (1999) 85 FCR 436
Sutherland Publishing Co Ltd v Caxton Publishing Co Ltd [1936] 1 Ch 323

Case(s) also cited:

Ancher, Mortlock, Murray & Woolley Pty Ltd and Others v Hooker Homes Pty Ltd [1971] 2 NSWLR 278
Beck v Montana Constructions Pty Limited [19645] NSWR 229
Blackie & Sons Ltd v Lothian Book Publishing Co Proprietary Ltd (1921) 29 CLR 396
Blair v Osborne & Tomkins and Another [1971] 2 QB 78
Caj Amadio Constructions v Kitchen (1991) 23 IPR 284
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1981-1982) 149 CLR 337
Computer Edge Pty Ltd v Apple Computer Inc (1985-1986) 161 CLR 171
Devefi Pty Ltd v Mateffy Pearl Nagy Pty Ltd (1993) 113 ALR 225
Giumelli v Giumelli (1999) 196 CLR 101
Legione v Hateley (1982-1983) 152 CLR 406
Lend Lease Homes Pty Ltd v Warrigal Homes Pty Ltd [1970] 3 NSWR 265
LED Builders Pty Ltd v Eagle Homes Pty Ltd (1999) 44 IPR 24
Raben Footwear Pty Ltd v Polygram Records Inc and Another (1997) 145 ALR 1
Stovin-Bradford v Volpoint Properties Ltd [1971] 1 Ch 1007
Sullivan v FNH Investments Pty Ltd [2003] FCA 323
SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1984-1985) 159 CLR 466
The Commonwealth v Verwayen (1990) 170 CLR 394
Walton Stores (Interstate) Ltd v Maher (1987-1988) 164 CLR 387
Witham v Witham [2000] WASC 236

KENNEDY CJDC: The plaintiff is, and was, at all material times, a registered builder. The first defendants were registered proprietors of property situated on West Coast Drive, Marmion and the second defendants also conducted a building business.

Claim

In or about March 1998, the plaintiff by its employee, Mario Figliomeni, designed plans for a house to be constructed at the property. Mr Figliomeni was at all material times an Australian citizen and resident in Australia. These plans were unpublished. The plaintiff claims copyright in the plans and that the defendants have infringed the plaintiff's copyright in that the first defendants caused working drawings to be prepared to enable construction by the second defendants, without the plaintiff's consent, of a house on the property, which drawings are a reproduction of a substantial part of the plaintiff's plans. The first defendants had authorised construction of the house, the second defendants constructed the house and without the plaintiff's consent which reproduced, in three‑dimensional form, a substantial part of the plan. The defendants caused copies of the working drawings to be distributed amongst sub‑contractors engaged by the second defendants to assist in construction of the house without the plaintiff's consent, which copies of the said working drawings are a reproduction of a substantial part of the plan.

Defence

The first defendants do not deny that the plans were commissioned and obtained from the plaintiff but say that, by oral agreement in or about January 1998 made between Graham Bond on behalf of the first defendants and Mario Figliomeni and George Jerkovich on behalf of the plaintiff, the first defendants and the plaintiff agreed:
"(a)The plaintiff would revise 'Floor Plan 1' to ensure that a building built in conformity with the revision would:
(i)comply with all applicable regulations;
(ii)be capable of practical construction at a competitive price;
(iii)include changes to be suggested by the plaintiff or its agents or the first defendant;
(iv)the plaintiff would provide the first defendant with a drawing (Floor Plan 2) of the revision of 'Floor Plan 1'.
(b)By using the plaintiff's services the first defendant would not be bound to have the plaintiff build 'the house'.
(c)In consideration of the plaintiff providing to the first defendants 'Floor Plan 2' the plaintiff would have an opportunity to quote a price to build the house.
(d)It was an implied term of the agreement that the plaintiff, to whatever extent it owned copyright in Floor Plan 2 licensed the first defendant to copy Floor Plan 2 for obtaining necessary approvals, obtaining quotes and generally for the purpose of constructing the house."
Alternatively, based on the same agreement, the first defendants assumed that the plaintiff licensed the first defendants to copy "Floor Plan 2" and the plaintiff induced that assumption. The assumption was induced by the plaintiff by:
(a)In January 1998 by telephone Mario Figliomeni on behalf of the plaintiff answered affirmatively to an enquiry by Graham Bond on behalf of the first defendants asking if the plaintiff could assist with the design and drawings for the house without obligation to the plaintiff other than payment of a fee.
(b)At the meeting mentioned in par 4 (that is the paragraph in which the defendants set out the alleged agreement) no mention was made that the plaintiff did not, in the circumstances pleaded in par 4(a), par 4(b) and par 4(c) thereby licensed the first defendants to copy "Floor Plan 2" for obtaining necessary approvals, obtaining quotes and generally for the purpose of constructing "the house".
(c)Knowing that:
(i)The first defendants were obtaining prices from other builders.
(ii)The first defendants believed the plaintiff's price to be too high.
(iii)The first defendants did not intend to enter into a building contract with the plaintiff.
(iv)That the first defendants would have "the house" built.
The plaintiff did nothing to assert or clarify its claimed copyright and/or the existence of a licence of the kind pleaded in par 25 or of any other kind.
It is further pleaded that the plaintiff knew the first defendants were acting on the assumption by the tenor and effect of telephone conversations and by the tenor and effect of what was said in the meeting.
It is then pleaded that the first defendants acted on this assumption by providing "Floor Plan 1" to the plaintiff and dealing with the plaintiff, providing the second defendants with Floor Plan 2 and having the second defendants construct the house.
The plaintiff denies that this agreement existed and the defendants deny that they have infringed the plaintiff's copyright.
The second defendants also deny that they have infringed any copyright and say that if, indeed, they did infringe copyright, then it was without their knowledge and without intent to infringe that copyright.

Was Mario Figliomeni employed by the plaintiff?

As a threshold issue the defendants deny that Mario Figliomeni was employed by the plaintiff and allege that he was employed by MCPBB Pty Ltd. Section 35(6) of the Copyright Act 1968 ("the Act") provides that where an artistic work is made by the author in pursuance of the terms of his or her employment by another person under a contract of service the employer is the owner of the copyright in the work.
Mr Figliomeni is a qualified draftsman and has been for 20 years. He worked for a number of building companies and did some subcontracting work for Seacrest Homes. However in 1996, 1997 and 1998 he was actually employed by Seacrest Homes. On 4 July 1996 he was asked to work full-time by Mark Basso-Brusa. He agreed and signed an employment declaration (Exhibit 4) for taxation purposes on that day that provided that Delstrat Pty Ltd, trading as Seacrest Homes, was his employer.
He worked 8.30 am to 5.00 pm Monday to Friday at 69 Challenge Boulevard, Wangara which is where the offices of Seacrest Homes were. He was given a payslip and paid each week. He received holiday pay, superannuation and sick leave. He had the normal lunch break and he was provided with everything to do with his work. Furthermore, instructions were given to him by Mark Basso-Brusa.
Payslips which are Exhibit 5 and which are actually titled "Seacrest Homes pay details" were given to him but the money was paid directly into his bank account.
He conceded that approximately a week before he had been called to give evidence he found out that for taxation purposes his employer was a company called MCPBB Pty Ltd. His taxation return was prepared for him by an accountant. As far as he could recall he had never before heard of MCPBB Pty Ltd.
In cross-examination he was shown Exhibit D20 which is a group certificate which shows his employer as MCPBB Pty Ltd. Further, his tax return, Exhibit D19, refers to that company as his employer.
He had always believed that his employer was Seacrest Homes.
The explanation for all of this was given by Mr Mark Basso-Brusa who is a builder and is one of three brothers who are the directors of the plaintiff. The company MCPBB Pty Ltd is also their company and its name is made up of the initials of the three brothers.
The three brothers have two businesses, a joinery business which trades as "Modern Joinery" and a house building business which trades as "Seacrest Homes". Both of these businesses were owned by a private family company, Delstrat Pty Ltd. The plan the brothers had was to separate the two businesses so that Delstrat Pty Ltd would own Seacrest Homes and MCPBB Pty Ltd would own Modern Joinery. This plan is reflected in Exhibit 50 and Exhibit 51 "Business Names Extract Results".
Exhibit 51 shows the details of Seacrest Homes and shows that that business was registered initially on 5 July 1996. At that stage and at all times the corporation carrying on the business was said to be Delstrat Pty Ltd.
Exhibit 50 is the Business Names Extract for "Modern Joinery". It shows that on 3 July 1997 a statement of change in certain particulars was filed and that was that while previously Delstrat Pty Ltd had carried on the business under that name henceforth the business would be carried on by MCPBB Pty Ltd.
Unfortunately there was confusion in the office because two separate PAYE employers' payment books were sent by the Australian Tax Office. Exhibit 51.1 is said to be for "MCPBB Pty Ltd trading as Modern Joinery" and Exhibit 55.2 is said to be "Delstrat Pty Ltd trading as Modern Joinery". So at that point there were two books for Modern Joinery and none for Seacrest Homes. The office solved the problem by using the one that was closest to correct and using it for both businesses. They used the book for MCPBB Pty Ltd trading as Modern Joinery.
The end result of this is that when it came to the attention of the accountants at the end of the financial year the group certificates had to be issued in the name of MCPBB Pty Ltd and that is the only reason that they were issued in that name.
Mr Basso-Bruso pointed out that they had similar problems with state payroll tax because the State Revenue accessed the Commonwealth records to get details for payroll tax. Exhibits 56.1 to 56.4 are documents in relation to state payroll tax but in actual fact the plaintiff paid the payroll tax.
According to Mr Basso-Bruso, confirmed by Mr Carcich the independent accountant and by the tax returns, Exhibit 51 (1998) and Exhibit 53 (1998) for the two companies, MCPBB Pty Ltd did not trade in 1998 but Delstrat Pty Ltd did trade.
Documents were also produced to show that MCPBB Pty Ltd did not have any income at the relevant time, that any accounts were paid by Delstrat Pty Ltd and debited in the loan account. During the same year the name "Modern Joinery" only appeared on the payroll records because the attaché software used by Modern Joinery division was best suited for preparation of payrolls. It had nothing to do with identifying the employer of the staff. These matters were then remedied in the books of account of the businesses. The plaintiff paid for the software to be reprogrammed in May 1998 (when there was no controversy as to the identity of Mr Figliomeni's employer) in readiness for the 1999 financial year when the joinery and building divisions began to be operated separately by MCPBB Pty Ltd and Delstrat Pty Ltd respectively.
On the evidence that I have, at all times Mr Figliomeni was a designer for "Seacrest Homes". He had nothing to do with the business of "Modern Joinery". All Mr Figliomeni's work was prepared and published under the head "Seacrest Homes". He worked from Seacrest Homes building and he was at all times held out as an employee or agent of Seacrest Homes.
It is quite apparent from the evidence I have that Mr Figliomeni was employed by Seacrest Homes, that MCPBB Pty Ltd did not even trade in the relevant year and has never owned a business that engaged in the business of designing homes or building them.
In all the circumstances I am satisfied to the required standard that Mr Figliomeni worked for the plaintiff.
Before proceeding on to the next matter it is necessary to say something about Exhibit 5. Exhibit 5 is a set of payslips which have plainly been photo copied altogether because they are not separate documents but are on three sheets of paper. Before each fortnightly pay period there is typed in the words "Seacrest Homes pay details". While this document had apparently been given to the defendants much earlier, it was not in an affidavit of discovery until 11 September 2003, that is to say in between the first and second lot of court dates for this matter. In that affidavit of discovery it is referred to under item 8 as "Cut and paste record, note Seacrest Homes added." Mr Basso-Brusa said that each one of the items in Exhibit P5 comes from a separate document; it would never be possible to put someone's payslips all on one document. If payslips were all on one document that would demonstrate to anyone looking at the document that the payslips had simply been photo copied and that is what happened here and the words "Seacrest Homes pay details" were added.
The plaintiff was asked by its solicitor to provide pay details for Mr Figliomeni. It was not possible to put them on one document so they cut those relating to Mr Figliomeni out of the records, put them all on to one document, photo copied that and sent it their solicitors. The name at the top, that is to say "Seacrest Homes", was put there because Mario Figliomeni worked for Seacrest Homes. When they sent Exhibit P5 to their solicitors they told the solicitors it was a cut and paste document. He denied that there was any attempt to mislead the Court. He had no idea what his solicitors sent to the defendants and he said in answer to a question in cross-examination that the cross-examiner could call it what he liked but it had come from Exhibit 55.
While this was careless and unfortunate and may have caused the defendants to do extra work and may have led to the first adjournment of this matter, I do not believe that it was a deliberate attempt, or any attempt for that matter, to mislead the Court.

Was there an agreement between the parties as specified in the defendants' further further amended defence?

The allegation is that there was an oral agreement made in January 1998 between Graham Bond for the first defendants and Mario Figliomeni and George Jerkovich on behalf of the plaintiff. Furthermore, that agreement had in it an implied term that the plaintiff would license whatever copyright it had to the first defendants or alternatively the defendants assumed that the plaintiff had so licensed the first defendants, the plaintiff induced that assumption, the defendants acted on the assumption and the plaintiff knew the defendants were acting on the assumption.
The first meeting between the parties was on 21 January 1998. The meeting was attended by Mario Figliomeni and George Jerkovich, employees of the plaintiff, and Mr Bond. (Throughout these reasons when the first defendants are referred to separately they will be referred to by name as a matter of convenience). As has already been recorded, Mr Figliomeni was a designer for the plaintiff and Mr Jerkovich was employed as a sales representative.
The meeting was convened at Graham Bond's request and Mr Figliomeni arranged for Mr George Jerkovich also to attend. The reason for this was that design briefs usually came through sales people. Since this had come directly by a telephone call to Mr Figliomeni he arranged for the sales representative to attend at the meeting.
According to Mr Figliomeni, Mr Bond brought a survey plan for the land with him but no other document. Mr Bond gave instructions as to the requirement for the proposed home and Mr Figliomeni took notes (see Exhibit P7). At the meeting some rough sketches were done to illustrate the first defendants' requirements. The plaintiff was able to establish that these were done within the meeting because they are done on paper that has other matters relative to the plaintiff on them (see Exhibit P8). The sketch on the left-hand side of this piece of paper depicts an idea of placement of the rooms. The end sketch with a sloping line shows the land slope and the symbol "F" refers to the family room with a games room underneath. On the reverse of this piece of paper "M" refers to the meals area.
During the meeting there was a discussion and it was explained to Mr Bond how the system worked. It was explained that it was a free service. Mr Figliomeni would design the home until Mr Bond was happy with it and once that was done Mr Jerkovich would go through the details of things that Mr Bond wanted, such as tiles, and it would then be priced by Seacrest Homes and they hoped that Seacrest would be contracted to build the house.
Mr Figliomeni confirmed that initially when he had spoken to Mr Bond he had told Mr Bond that Mr Bond did not have a commitment to build with Seacrest Homes. Mr Figliomeni said he could not remember the exact words he used but he would have told him that the designs are free if he built with Seacrest but the designs belong to Seacrest. He denied specifically in cross-examination that Mr Bond had said to him "I just want to have the design done and pay a fee" and he further denied that his answer to that was "That's not a problem". Mr Figliomeni said he would not have said that and he certainly did not have the authority to say it. The design is obligation free but that does not mean a client can take the design. The design did not belong to the client. It was made clear to the client that it was not his to take. Further in cross-examination Mr Figliomeni said he could not remember whether Mr Bond had said he was happy to pay for the design but did not want to get into bed with a builder but if he had said that Mr Figliomeni's answer would be the same. It is the standard response that the design was not his, that they are a design and build company and the reason that he is so sure he would have made this clear is because he always does.
Mr Jerkovich confirmed Mr Figliomeni's evidence and said that while he could not remember the actual words he does know what is his standard practice. His standard practice was to say that Seacrest would do the design and if the client was happy they would do the plans and cost it and that they would build it. He did not mention what happened to the plans if the client did not build with them because Mr Jerkovich assumed that the client had come to them because the client wanted them to design and build their house. It is a standard practice to say that they are not a design service, they design to build.

Mr Bond's evidence in relation to this meeting was completely different from that of Messrs Figliomeni and Jerkovich.
He said that he had been to several people to put a floor plan together and over a period of time had spent the extraordinary amount of $20,000 developing the plans. The third person he went to to assist with this was a Mr Greg Coffey from Devise Designs. He and his wife were very happy with Mr Coffey's design. They felt they had made a lot of headway but they also thought they had got to a stage where they needed to see a builder who knew about specific building matters and also knew about council regulations for the particular area.
Mr Bond produced Exhibit D22 and Exhibit D23 and said that these are what has been referred to in the defence pleadings as "Floor Plan 1" and that he produced these at the initial meeting.
Before he got to that meeting he had telephoned Mr Figliomeni, told him that he needed help and asked did the plaintiff have a design service and was it free of commitment to build and Mr Figliomeni said "yes" to both questions. He told Mr Figliomeni that he had a basic floor plan and requested help to tidy it up and put it in order so that it would get council approval. He agreed that Exhibit 7, the list in Mr Figliomeni's handwriting, were notes that were taken at the time by Mr Figliomeni but his explanation was that they were discussing how far he and his wife had got to date and what they wanted to achieve. He further agreed that Exhibit P8, the rough sketches, had been done at the meeting but his explanation for that was that he was seeking to let Figliomeni know where they were coming from, to tell him the progress they had made already and what their requirements were for the future. He denied that the level of detail in Exhibit P8 indicated that Mr Figliomeni was starting from scratch.
When he met with them he told them that he wanted help with the design work only and that this was to be on the understanding that they would have the opportunity to do the first quote on the business.
To make sure that I understood this I asked:
"... But you explained how far you'd gone and where you wanted to go and asked for help with the design work and they said, 'yes,' on the understanding that they had the opportunity to first quote?---To quote on the business, yes; to compete for the business, basically, yes, and that would involve George more so than Mario.
Alright. What were they going to charge you for this service?---That hadn't come up at this stage.
Did you ask? Did you say to them, 'hey I've paid $20,000 up to now. What's this going to cost me?'---No, we didn't discuss money."
In examination-in-chief Mr Bond did not say what documents he had left with Mr Figliomeni. He simply said that he had taken the site plan and certain "bits and pieces" and that Mr Figliomeni and Mr Jerkovich took some of these "bits and pieces" and he took the remainder away.
In cross-examination he said that later that day he left Exhibit 23 for Mr Figliomeni and that this is what the defence pleading refers to as "Floor Plan 1".
Exhibit 23 is in fact a Devise Design plan that has been photo-copied back to front. It then has various pieces of writing on it by Mr Bond giving directions to "Mario". Photo-copied on that design is a note as follows:
"Mario – I have chopped around Devise plan – My end resalt (sic) is somewhere between the two. – Please make the basic floor plan changes and no dout (sic) I will change it a bit more until we get there.
Regards Graham Bond"
This of course is a credibility matter which is intended to make weight for the defence because what Mr Bond is saying is that there was very little work for the plaintiff to do. The defence concedes that the plaintiff's plans were an original artistic work. Mr Figliomeni and Mr Jerkovich deny ever having seen Exhibit D23. If of course the work was already done and they were given the Devise plans and had very little to do then one assumes that Mr Bond believed that it would be easier to have people believe that they would do what little work was required on spec on the off chance that they would get the job. This would provide an explanation as to why they were prepared to do that work without the discussion of a fee or payment of a fee which of course was different from every other experience that Mr Bond had had.
I prefer the evidence of Mr Figliomeni and Mr Jerkovich (neither of whom now work for the plaintiff) and indeed in any matter where their evidence conflicts with the evidence of Mr Bond, I prefer that evidence.
The plan that Mr Figliomeni eventually prepared is completely consistent with Exhibits 7 and 8, together with the fact that certain matters are, as Mr Figliomeni said, standard in a house of the value of this one. Furthermore he had placed the bedroom on the southern side of the house rather than the northern side, as they had initially discussed, to give it views of the ocean down the driveway. Additionally Exhibits 7 and 8 need never have come into existence if the Devise plans were to be handed over. One also asks why those plans were not taken to the first meeting if they were to be handed over.
It is not surprising that the design brief and the plaintiff's drawings bore some similarities to the Devise plans because Mr Bond was himself mindful of those drawings when he instructed Mr Figliomeni. Mr Figliomeni also gave evidence as to numerous differences and improvements introduced by himself.
The existence of Exhibit D23 is far too convenient and there is no doubt that it could have been done after the event or it could have been done before the event. It is my finding that it was done after the event. It was done for the sole purpose of making up evidence for the purpose of the proceedings.
Apart from the fact that I prefer the evidence of Mr Figliomeni and the fact that it is far too convenient, it appears to be the only set of plans that Mr Bond has kept and he has kept a photo copy of it plus a photo copy of his handwritten note to Mr Figliomeni.
Mr Bond testified that Mrs Bond was present when he "played around with" Exhibit 23 before giving it to Mr Figliomeni but Mrs Bond did not give any evidence on this point.
Furthermore the very good point made by the plaintiff's counsel is that Mr Bond's handwritten note does not make sense if it were delivered to Mr Figliomeni before the latter prepared his first set of drawings because the words "between the two" imply that the changes noted on Exhibit D23 represent a design somewhere between two other designs. When Mr Bond says he gave Exhibit D23 to Mr Figliomeni there was only one design in existence, namely what has been referred to as "Floor Plan 1".
During the course of the trial there were far too many differences between the state of knowledge of the defendants' counsel and matters that subsequently emerged either in cross-examination when the defendants' counsel was pushed to the point by the plaintiff's counsel or in Mr Bond's evidence. For example, the defendants' counsel said that they were not sure when Exhibit D23 was prepared, however Mr Bond was quite specific about it. The matter of payment of a fee differs between the pleadings, the cross-examination of Mr Figliomeni and the evidence of Mr Bond.
So far as subsequent events provide evidence of what was the initial agreement, those events support the plaintiff. Further the fact that Mr Bond never actually told them that he was building with someone else and always gave them to understand that if they reduced the price the contract would be with them, supports what they say.

What happened after the first meeting?

Within a couple of weeks of the meeting Messrs Figliomeni and Jerkovich visited the site and Mr Figliomeni started to do some design plans. The initial concept drawings he prepared are Exhibit P10 and these were done by him by hand because computer drawings are only done later after the price has been negotiated. It is quite true that Exhibit 7 which were the notes he made at the first meeting did not include a spa and that is in Exhibit P10. He confirmed that he had telephone calls with Mr Bond before Exhibit P10 was done. He does not know if Mr Bond mentioned a spa but with a home of this value that would be included. Certainly his note in Exhibit 7 of "four bed two bath" is shorthand for an en suite. There was to be no formal area but the defendants wanted a dining room. So far as the passage zigzagging is concerned that was simply part of the design process. A study is not in the design brief but he would have spoken to Mr Bond about that and he did remember that the first defendants wanted an activity room. He said that there are standard things that are put into a home of this value. He did remember being told to put a powder room downstairs but he would have put a toilet down there anyway.
To get to the stage of Exhibit P10 he said that he put in 1 to 1½ days to prepare that and Messrs Bond and Jerkovich were chasing him to get the drawings done. Finally Mr Bond said to him that it did not have to be perfect, if there were any concept drawings done he wanted to see them so that they could then get together. These drawings were given to Mr Jerkovich on 27 January 1998, he put the copyright sign and the name of the company on them and took them to Mr Bond to get further input and to work on from there.
Exhibit P11 are those same drawings returned by Mr Jerkovich in mid February with notes of alterations (Exhibit P12) that Mr Bond wanted to make. On Exhibit P11 there are items which are in Figliomeni's handwriting.
Exhibit P13 are another set of drawings which are referred to as the second set in which he takes in changes and experiments with different options. He did the drawings on this occasion and then gave them to one Louise Hopper who works for Seacrest Homes and her job was to do his drawings on transparency and to make them neater. She added nothing to the drawings. He then included drawings of the elevation and upper level dimensions. This is Exhibit P14 and these were given to Mr Jerkovich to give to Mr Bond and again Mr Jerkovich came back with more changes but they were minor changes. There are then tendered Exhibit P15 and Exhibit P16, also drawings by him, and a gym has been added downstairs because that was what Mr Bond requested and Exhibit P17 is the final set of drawings. It is his design and includes his site plan.
The work, including site visits, attendance on Mr Bond, telephone calls and design, would have taken about a week. According to the log book the final set of drawings were issued on 12 March 1998 and he had nothing further to do with the matter after that.
Some time later he was driving on West Coast Highway and saw a house similar to his design. The main slab was down but the building was not completed. He could see the stairs and the bar area and he stopped to have a look. He then reported what he had seen to Messrs Jerkovich and Mark Basso-Brusa.
He was then shown Exhibit 3 which the defence conceded were plans that were the same as the plans that Figliomeni had drawn and he said that he did not draw those plans. These turned out to be working drawings prepared later by a Mr Schoones at Mr Bond's request to enable the house to be built.
Mr Figliomeni said that while working for the plaintiff he was never given the work of another draftsman not employed by the plaintiff to copy that work.
Mr Jerkovich also confirmed that the company policy reinforced in sales meetings each week was that if someone brought plans in from another company they were not to take the matter any further because they were a design and build company. This company policy was never put in writing.
He confirmed that he got the first set of drawings from Mr Figliomeni on 27 January 1998. He photo copied them and put the company name and copyright notice on them and he wrote the words "Proposed Residence". He then put them in a file and gave them to Mr Bond at his place of work. In mid February 1998 he met Mr Bond at his place of residence and Exhibit P11 has red pencil, blue pencil and ordinary pencil on it. The red pencil is Mr Bond's, the blue pencil is Mr Jerkovich and the lead pencil is when he eventually took it back to Mr Figliomeni and told him the instructions from Mr Bond and Mr Figliomeni wrote in pencil on the document.
As to Exhibits P14, P16 and P17 he said that each of these was given by him to Mr Bond and he returned them to Mr Figliomeni because Mr Bond had made alterations to them. He certainly recalled that at some stage Mr Bond had said that they wanted the meals area pushed out towards the ocean and a modification of the stairs but he cannot recall the sequence of events. He confirmed that the curved bar on Exhibit P16 was done by Mr Figliomeni before Mr Bond got the plans because Mr Bond had asked for it.
It was at this stage when they had Exhibit P16 that Mr Bond told him the plans were acceptable and that is why he costed the job from Exhibit P17 and the gradient was done by Mr Figliomeni and this is included in Exhibit P17 and he did additional costing on that.
Mr Des Pettit did costing on Exhibit P16 and it was then given to the director, Mr Mark Basso-Brusa who also does costings and then gives it back to Mr Jerkovich to discuss with the client.
Exhibit P26, are the Seacrest Homes specifications of 11 March 1998, which he prepared and then gave to the estimator. The writing on it is his and Mr Bond's. Exhibit P27 has a costing of $364,120, that is in his handwriting but he got the price from Mr Mark Basso-Brusa.
There were then instructions for additional items from Mr Bond and Exhibit P28 is a second costing sheet of 19 March 1998, most of which is in his handwriting but the last three items, plus the sentence beginning with the words "Room", is in Mark Basso-Brusa's handwriting and the figures are in the latter's handwriting and also the handwriting of Mr Des Pettit. Quotes were also obtained from businesses who would be helping to build the house and they can be seen in Exhibits 29 and 32.
The final result of all this is Exhibit P32 "Individual version of specifications".
What they normally then do is to get the client to sign so that they can prepare plans but Mr Bond said to leave it with him and he would decide what he was going to do. Mr Jerkovich said he never got a direct answer from Mr Bond. Whenever he spoke to him Mr Bond had either not made a decision, or was too busy to think about it, or did not return his calls. Exhibit D33 is his diary come work journal for the relevant period of time.
He made the point that the diary is a combination of things that he actually does, a list of his appointments and reminders to himself that he may not deal with on the day on which he had written the reminder.
He has a diary entry of 7 July:
"Call Graham Bond.
1.   Check price with comparable builder.
2.   Able to buy plans if not competitive price.
3.   Compromise on costs."
He said he could not remember exactly but he would have made it clear that they did not sell the plans. He certainly remembered that Mr Bond wanted the house cheaper without compromising on any of the fittings.
What he recorded in his diary were the set of questions that Mr Bond asked him. It can be seen in the diary that he has traced over Mr Bond's name on a number of occasions and he did that while he was on the telephone with Mr Bond. He was simply doodling and it indicates that these notes were made at the time of the telephone call. He agreed that he did not answer Mr Bond on whether he could buy this actual set of plans, he simply did not answer him and said that he would get back to him on all matters but never did in relation to that.
He did recall after some prompting that he had been to Mr Bond's place of work with the sales manager, Mr Krsticevich, and he recalled that Mrs Bond was there at the time. It was after the price was presented so it would have been after April but in his memory it was not toward the end of the year.
He agreed that they attempted to close the deal to see what they could do to get an agreement but he would not have offered a site reduction price because he would not have had the authority to do that. He denied that Mr Bond made it clear he was not proceeding with the plaintiff. He said that if Mr Bond had said that, he would not have followed up with him after this meeting and he believes there were subsequent meetings. He confirmed that he called Mr Bond on a number of occasions that are simply not recorded in the diary. So far as recordings in the diary there is a reference to Mr Bond on 16, 20, 23 and 27 July, 3, 13 and 18 August and 30 September.
Mr Miro Krsticevich now works for Oswald Homes but worked for the plaintiff until 2001 and was the sales and marketing manager.
Initially Mr Krsticevich said that he had only met Mr Bond but not Mrs Bond and was quite definite about it but subsequently in his evidence he did seem to concede that he could have met with Mrs Bond because he said that he could remember talking about his motor vehicle to someone and it was not Mr Bond but otherwise he appeared to have no memory of Mrs Bond being there.
He had already been advised by Mr Jerkovich that Mr Jerkovich was having trouble getting a commitment from Mr Bond so the two of them went to the car yard and there he spoke to Mr Bond. He asked Mr Bond if there was any problems and Mr Bond told him the design was good but the price was a bit high. He endeavoured to reassure Mr Bond that he would get a better product from the plaintiff and that is why they might be a bit higher than other builders.
When they left the issue Mr Bond finished off by saying "That's fine and I'll be in touch."
Mr Krsticevich did not remember the date or month but he believed that it was in the late stages of 1998. The reason he believed that is that it was not that long after that he was talking to Paul Basso-Brusa. The latter told him that he had purchased a vehicle from Mr Bond, he had spoken to Mr Bond and the contract would go ahead or they would get the deal or some words to that effect.
He categorically denied that he knew that Mr Bond was not going to build with them and he said that Mr Bond had said he would think about it. He denied that Mr Bond told him he had prices from other builders or mentioned the name of other builders. It is a simple matter to get a square metre rate for building a house and he pointed out that they were high quality builders.
Mr Mark Basso-Brusa said that the normal range of homes for Seacrest Homes were two or three storey homes from about $250,000. In 1998 they had about 15 staff which included one designer and two or three drafts people. In that same year they had about three display homes, they were all two storey homes and they ranged in value from $250,000 to $450,000. They did have some older standard design homes but most of their designs are one-off and Mr Figliomeni did the custom designs after discussions with clients.
They do not sell their plan to anyone. The only time they do that is in country areas where they do not build and they will sell plans through their country branch which is called "Broadway Homes". They do not take plans from other organisations.
Mr Paul Basso-Brusa is a director of both the plaintiff and MCPBB Pty Ltd and he first met Mr Bond in December 1998 and had nothing to do with him until that time. Mr Paul Basso-Brusa needed to purchase a land cruiser for the business and Mr Jerkovich said that Mr Bond had a car yard in Wangara and suggested they visit him because they were going to build a house for him. He and Mr Jerkovich went there and they discussed the purchase of a car with Mr Bond. In the process he said to Mr Bond words to the effect "What's happening regarding the house?" Mr Bond said "Drop $30,000 and we've got a deal." The witness said "We don't have $30,000 in the house." Mr Basso-Brusa said while he was not sure of the exact words he knew what the meaning of the conversation with Mr Bond was.

About two weeks later he went ahead and purchased a car from the first defendants' business. Their records indicate that the purchase went through on 22 December 1998. He had no problems with the car and was quite satisfied with the deal they got.
Mr Bond had very few of the plaintiff's documents in his discoverable documents. He agreed that he had been given a copy of Exhibit P11 but he does not know where it is and of course Exhibit P11 is the plaintiff's design that has the most explicit copyright warning on it and he agreed that it was his writing in red ink on that document but said he did not take any notice of the warnings.
After he got the quote from Seacrest Homes he then went to see Mr Francesconi, the second defendant, and also another builder and they each gave him a quote of about $350,000. Their quotes were so far away from the plaintiff's that he told Mr Jerkovich of the other two builders and told him that the plaintiff was $100,000 out. He does not think that at that stage he told him the names of the builders or their exact price. He then went back to the second defendant and said that the plaintiff was saying that there was no way the second defendant could build for the price that he had given. The second defendant said if he paid for an estimator they could get the price checked. The Jamieson estimate was obtained and notably that is dated 14 July 1998.
He then says that he spoke to Mr Jerkovich again and said:
"You blokes have made a mistake. Find out where the mistake was ... get the price back to somewhere within kicking distance of what the other two builders have quoted me so that we could move along." (T475)
It was then that Mr Jerkovich made an appointment to come and see him and he brought with him Mr Krsticevich. This may have been in July or August. He said that his wife was at the meeting and he told them that $100,000 was too high. Mr Krsticevich said that they would throw in the earth works and he said "Well you're still $80,000 above the others." On his observations they were still convinced that the other builders could not do as well and he said that finally he agreed to disagree with them that they were not getting the job.
He had the diary entry of 7 July 1998 put to him and he said that this telephone call never happened. He never asked if he could buy the plans. They were his plans to do with as he wished and he was never told anything by anyone from the plaintiff that was contrary to that. It was his design. Mr Figliomeni just drew it. Mr Krsticevich never raised copyright with him, nor was the use of the plans raised. He never offered to buy the plans from them, they were his plans and he never received a request for a payment of a fee.
It is quite true that Mr Jerkovich telephoned him a few times after that and asked him if he had changed his mind but the plaintiff knew that he was going to use its plans and that he was going to build with Hillcrest Homes. He denied that he was trying to hide from the plaintiff that he was building the house and said that he did not deliberately breach their copyright. The difference was purely money, otherwise he would have dealt with the plaintiff.
He agreed that they came to see him in December and he was quite surprised that they had bought a vehicle. There was some banter about them not getting the job but that is all he can remember.
Mrs Carolyn Bond gave evidence that she was at the meeting with her husband, Mr Jerkovich and Mr Krsticevich. When they first arrived her husband was busy and they came into her office and chatted until her husband came. Negotiations were about price. Their quote was more than the first defendants wanted to pay and somewhere there was mention of other quotes they had but the plaintiff's people said they had very high standards but they would drop the price for the earth works.
Her recollection was that they decided to go for a cheaper builder and that the Seacrest people were told that but subsequently she said she could not recollect if another builder was mentioned and she did not speak during the course of this meeting.

Conclusions

Wherever the evidence of Mr Bond conflicts with that of any other witness I prefer the evidence of that witness. I say that because of my conviction that Exhibit 23 was manufactured by Mr Bond after the event and also because of his manner and demeanour and because there was from time to time noticeable differences and significant differences between what was put by defence counsel, what was not put by defence counsel and also Mr Bond's subsequent evidence. Of course even the pleadings were different from Mr Bond's evidence in that Mr Bond made it very clear that there was no offer of money by him, that the plans were his and there was no reason for him to offer any payment. During cross-examination of Mr Figliomeni it was put to Mr Figliomeni that Mr Bond had said to him "I just want to have the designs done and pay a fee." Furthermore as to later negotiations, Mrs Bond is mistaken when she says that builders were named at the meeting.
It follows from these reasons that there was no Floor Plan 1 and therefore there could not have been any Floor Plan 2. Thus the starting point for the agreement alleged by the first defendant did not exist and there was no such agreement. The plans were plainly an original artistic work copyright for which vested in the plaintiff.
No term could be implied into any agreement they did make that there was an implied licence of the copyright plan because Mr Figliomeni told Mr Bond that the designs belonged to the plaintiff.
Furthermore Mr Figliomeni said he made it clear to the client that the design was not the client's to take. In addition of course all of the plans were marked with a copyright notice and Mr Jerkovich said that had he been told at any time that Mr Bond was not interested in going ahead with them, he would not have continued to pursue him. (As to the meeting between Mr Krsticevich, Mr Jerkovich and Mr Bond had, I am unable to say when that meeting took place. It was in the second half of the year but that is as far as I am able to ascertain because Mr Jerkovich thought it was early in the year. Mr Krsticevich thought it was not long before the vehicle was purchased).
Furthermore if Mr Bond believed that the agreement specified was the agreement he had made there is no explanation then as to why he did not tell at least Paul Basso-Brusa in December 1998, by which time the licence had been obtained for the second defendant to build the house, that he had exercised his right to have the home built by someone else. Conversely if the plaintiff had done the level of work it did on these plans but knew it had lost the job to another it is unlikely that Paul Basso-Brusa would have attended at the car yard and purchased a vehicle from the first defendant.
As to the alternative defence, Mr Bond said himself there was no discussion of money or of the payment of any fee and therefore subpar (a) in that alternative is not made out even on the defendant's evidence. So far as subpar (c)(i), (iii) and (iv) is concerned it is my finding that the plaintiff did not know the facts therein specified.
In those circumstances it was not to the point that the plaintiff did nothing to assert or clarify its claimed copyright. It had already told the defendant through Mr Figliomeni that the plan was not his to use at his will. When he asked Mr Jerkovich if he could buy the plan Mr Jerkovich simply did not answer him (incidentally Mr Bond denies that that conversation even took place) and all of the plans that were given to Mr Bond were marked with a copyright notice.
Plainly the plaintiff's copyright has been infringed and a number of the plans were produced to enable the house to be built.

The second defendant

Dennis Peter Francesconi who will be referred to for the sake of clarity by name is a registered builder who is in partnership with his wife as registered builders and they trade as Hillcrest Homes.
He received a call from Mr Bond in about mid 1998 wanting him to price a house and he brought sketch plans to Mr Francesconi. The sketch plans had the name of Seacrest Homes on the bottom of them. He did ask about Seacrest Homes' attitude to him giving a price and said that he did not wish to tread on anyone's toes. He was told that Mr Bond had been given permission to go ahead and get other prices. Furthermore Mr Bond told him that Mr Bond had simply been to see the plaintiff but the sketches were his own, they were his own ideas and the plaintiff simply drew up these things from his own sketches and his own ideas.
Mr Francesconi gave Mr Bond a rough square metre rateage and estimated a price of around about $330,000 with no retaining walls. He told Mr Bond that to get a proper price done he would need working drawings but he could get a fair estimate on the sketch plans if Mr Bond was prepared to pay for an estimation on the sketch plans.
Some weeks later Mr Bond came back to him and asked him to get that estimation and he referred the matter to Jamiesons Estimations. They provided an estimation on 14 July 1998 (Exhibit 39) and that estimation was based on the plaintiff's sketch plans, contours and everything provided by the plaintiff. That estimation was $337,000.
Some time after that Mr Bond contacted him again. Mr Francesconi thinks that he said that he had been back to the plaintiff with the estimate, the plaintiff was too expensive and he wanted to talk to him about building the house.
Eventually Mr Francesconi suggested a cost plus contract and it was agreed on that basis and Mr Francesconi's fee was $45,000. He suggested this fee because he knew that with all the additional things that had to be done around this block with retaining walls that the house would eventually cost well over $400,000.
He then arranged for Mr Rene Schoones to prepare working drawings and Mr Schoones organised engineering drawings as well.
Mr Francesconi agreed that the plan he got from Mr Bond had the Seacrest Homes' logo on the bottom right-hand corner but he did not notice anything about copyright on it but as he said "Mind you, that little 'c' might have been there. I never knew what that meant." (T576)
A little later he said:
"... I thought copyright was something that a person – it's wholly their design and had to go to working drawings and everything. I've learnt a lot from this case."
He confirmed that he had told Mr Bond he would not want to interfere with the plaintiff but was reassured that he was allowed to quote on that and the reason he did not telephone the plaintiff was that he simply believed what Mr Bond had said.
Furthermore Mr Francesconi made the point that he had the timber doors for this house made by Modern Joinery and he took the plans to Modern Joinery so that Modern Joinery could see exactly what he needed.
He confirmed that he provided contractors with copies of working drawings and said "You have plans floating around everywhere." (T577)
Eventually the first and second defendants entered into a cost plus contract on 16 December 1998 and the City of Joondalup issued a building licence to the first defendants on 18 December 1998. Construction of the house commenced in or about early January 1999 and the defendants built a house based on the working drawings which for all practical purposes were identical to, or substantially the same, as the house the subject of the plaintiff's drawings.
While I accept that Mr Francesconi was misled by Mr Bond the reality is that he has been in the business of house building for many years. These plans had Seacrest's name on them, they had a copyright stamp on them and he was aware of their work in the building industry. He would also have been well aware that they paid people to provide these designs.
Section 115(3) of the Act provides:
"Where in an action for infringement of copyright, it is established that an infringement was committed but it is also established that at the time of the infringement, the defendant was not aware, and had no reasonable grounds for suspecting, that the act constituting infringement was an infringement of the copyright, the plaintiff is not entitled under this section to any damages against the defendant in respect of the infringement, but is entitled to an account of profits in respect of the infringement whether any other relief is granted under this section or not."
Any defendant must present a positive case proving an "active, subjective lack of awareness" that the act in question constitutes an infringement and also that objectively considered, he has no reasonable grounds for suspecting the act constituted an infringement. (See Milwell Pty Ltd v Olympic Amusements Pty Ltd (1999) 85 FCR 436).
Given the second defendants' knowledge of the building industry and the signs on these documents I am unable to find that the second defendants had no reasonable grounds for suspecting the act constituted an infringement of copyright.
I do accept what Mr Francesconi says about his conversations with Mr Bond. When one compares the sophistication level of Mr Bond and Mr Francesconi I find that Mr Bond would have been most convincing to Mr Francesconi. Nevertheless for the reasons I have given I do find that he had reasonable grounds for suspecting the act constituted an infringement.

Assessment of damages

Plainly there is a difference between an award of damages and an order to account for profits. The former is intended to compensate for damage to the copyright owners incorporeal property right, whereas the latter is intended to deprive the defendants of any unjust enrichment. However the plaintiff accepts that it is not entitled to receive both, that is to be over compensated. As such any payment by one pair of defendants in respect of the judgment against them would be taken to be a pro tanto discharge of the judgment against the other. The plaintiff may enforce against either of the defendants at the plaintiff's choosing and it is for the defendants to adjust their rights between themselves as they see fit.
In Fenning Film Service Limited v Wolverhampton Walsall & District Cinemas Limited [1914] 3 KB 1171 at 1174 Horridge J said:
"The damages are, ... 'at large' and therefore I can give what amount I think right as if I were a jury."
I do not of course take that as a licence to do as I please. The reasons must be transparent and there must be no double accounting.
In Sutherland Publishing Co Ltd v Caxton Publishing Co Ltd [1936] 1 Ch 323 at 336 it was said that a claim for damages for infringement of copyright is a claim for a wrong done to an incorporeal right, copyright and the measure of damages is the depreciation caused by the infringement to the value of the copyright as a chose in action. It seems to me that those comments must be read in the context of that particular case and in any event in Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales (1975) 6 ALR 445 at 446-7 the Court said:
"... It would, in my opinion, be wrong to treat the measure of damages for beach of copyright stated by Lord Wright MR in Sutherland Publishing Co Ltd v Caxton Publishing Co Ltd [1936] Ch 323 and adopted by Copinger, as having, in effect, the force and rigidity of statutory provision. The purpose of damages is to compensate the plaintiff for the loss which he has suffered as a result of the defendant's breach. It would, in my opinion, be wrong to regard it as the exclusive measure of damages for breach of copyright appropriate to all circumstances. Somewhat different considerations may apply to unpublished works from those which apply to published works. Furthermore, the circumstances in which breach of copyright arises vary widely. Various measures of damage appropriate to the particular circumstances have to be applied."
In the end the second defendants charged the first defendants $446,033.94. This was the cost of the contract plus the second defendants margin of $45,000. It did not include the original design work and preparation of specifications and naturally the second defendants could be expected to build it cheaper than the plaintiff because the second defendants do not have the expense and overheads of providing a design service.
The plaintiff's loss of profit was as follows:
The plaintiff's quote price (including extra work
in costing sheets dated 13 March and 1 April 1998,
profit, overheads, supervision but not including
options)$471,334.00
Cost of construction, not including profit,
overheads and supervision  $394,240.91
Gross profit $77,093.09
Less incremental costs             $ 8,750.00
Total loss profit  $68,343.09
So far as the incremental costs are concerned this is taken from Mr Mark Basso-Brusa's evidence and the submission is that these are the only overheads that should be allowed because the first defendants' contract would have been incremental work. All other overheads, office and administration costs, would have been incurred any way on Mr Mark Basso-Brusa's uncontradicted evidence.
The alternative submission is that it should be done on a licence fee approach with the assessment of a reasonable licence fee. The plaintiff's submission is that in that case it would look to Mr Standen's estimate of a reasonable fee for the same work carried out by a design office at $13,300 and say that they were in fact entitled to more than $13,300.
The plaintiff submits that they would be entitled to more than that because it was not a pure design office, it provided a design and construction service. It does not operate out of a small low cost office but from commercial premises with high overheads and also incurred costs of advertising, marketing, sales representatives, specification preparation and preparation of bills of quantity and costings. Unlike a design office only a small percentage of homes actually designed were actually built and therefore provided remuneration to the plaintiff.
Furthermore the plaintiff's copyright is valuable because if awarded the contract the plaintiff's exposure in the market place would be increased by:
·The prominence of the house in this case (ie West Coast Highway).
·The plaintiff's design skills would be made known to related professions, trades and so on.
·The project would provide advertising opportunities for the plaintiff as the plaintiff has a history of featuring its work in its advertising.
The defendants for their part dispute the plaintiff's entitlement to any damages or account of profit at all but if they are entitled to that then the defendants submit that they are entitled to less than either of those amounts and indeed would be entitled to only a very small amount of something calculated on Mr Figliomeni's wages for a week and an allowance for overheads.
In addition to the matters referred to by the plaintiff it must be realised that this was not a project home, nor was it simply the sketch of a basic floor plan. It was a one of a kind house with fully developed plans according to the contour and position of that particular block (which the designer had visited) and included the elevations. All the defendants did with those plans is have working drawings prepared. I actually find it difficult to understand how the first defendant, Mr Bond, has ever justified this behaviour to himself.
The house was built over many months with the second defendants taking, and being enabled to take, by the first defendants' behaviour, complete credit for the plaintiff's artistic skills, work and expenses. Further of being able to advertise freely on a main thoroughfare and now the house is a lasting monument to the second defendants. There is nothing in it for the plaintiff at all.
I reject the notion that the licence fee alone is sufficient compensation. It is worth more than a simple licence fee.
At the same time the loss of profit of $68,343 is too great. It depends entirely on the first defendants agreeing to build with the plaintiff at that price. While it was very important to the first defendants to build this particular house, and he had proved that over a period of time, and while this particular house was designed specifically for this block of land, it seems to me that the first defendant is use to bargaining and that at the very least he would have expected that there would be a substantial deduction in the initial price given to him. At the same time Mr Bond says that he would never have built with the plaintiff. It is necessary for his case that he say that but I do not accept that that is necessarily so given the unique position, the unique design and the fact that he owned the block and needed to develop it to get maximum benefit from it. In the end had there been no one else who was able to use the plaintiff's plans and had the plaintiff agreed to a reduction in the price of this property then I believe that the first defendants would have been forced to build with the plaintiff in all the circumstances of this case. At the same time it is necessary to take into account that the plaintiff did not have the disadvantage of having to take the risk on this house and it may be that had they proceeded something may have gone wrong that led to them making far less profit.

The second defendants made a profit of $45,000 but it must be taken into account of course that for that they not only used the plaintiff's plans with all that amounts to but Mr Francesconi personally worked on this site on a daily basis over many months and did all of the concreting work himself.
At the same time it must be weighed in the balance that the plaintiff may not have got the work, that Mr Bond may have gone off and built somewhere else and the plaintiff may have got nothing.
In the circumstances, doing the best I can, I assess damages against the first and second defendants in the sum of $30,000.
It seems to me that that cannot be the end of the matter in this particular case as against the first defendants.
Section 115(4) of the 1968 Act gives me power in assessing damages for the infringement to award such additional damages as I consider appropriate in the circumstances. It is necessary that I be satisfied that it is proper to award such damages having regard to the flagrancy of the infringement, the need to deter similar infringements of copyright, the conduct of the defendant after committing the infringing act and it would seem to me the conduct of the defendant leading up to the committing of the infringing act and any benefit shown to have accrued to the defendant by reason of the infringement.
This was a flagrant breach of the plaintiff's copyright. It was a deliberate breach of the plaintiff's copyright and it was perpetrated over a long period of time. Mr Bond is a businessman. He knows that people do not work for nothing. Furthermore for builders in general to get work it is necessary for them to advertise their wares and that means that they are always at risk of copyright infringement. In a community like ours where home building is considered to be a most important part of the life of many people it is important that it be made clear that it is not lawful to take someone else's plans and use them for your own purposes without their permission and that you cannot always right that wrong if you are caught by simply paying a design fee.
If I look at it simply from the first defendants' point of view during his evidence Mr Bond was anxious to endeavour to establish that he had somehow saved $100,000 by building with the second defendants. On the figures we have he has saved $25,300 so we know that amount was the direct benefit to the first defendants from exploiting the plaintiff in this way. Of course Mr Bond's evidence is that it was greater.
It is of course important to be careful not to engage in double accounting here and give the plaintiff damages twice for the same matter.
In the circumstances the first defendants must pay to the plaintiff an additional sum of $8,000.
It follows from these reasons that the plaintiff is entitled to damages against the first and second defendants in the sum of $30,000 and against the first defendants in the additional sum of $8,000.

[2004] WADC 55

1 April 2004