EMI Music Australia Pty Ltd v Federal of Australian Commercial Television Stations

In the matter of a reference by THE COPYRIGHT TRIBUNAL of a question
of law arising in proceedings before it between EMI MUSIC AUSTRALIA
PTY LIMITED and OTHERS (Applicants) AND PHONOGRAPHIC PERFORMANCE
COMPANY OF AUSTRALIA LIMITED and FEDERATION OF AUSTRALIAN COMMERCIAL
TELEVISION STATIONS (as parties to the application) and numbered in
the Copyright Tribunal as File No 1 of 1996
No. NG 577 of 1996
FED No. 323/97
Number of pages - 27
Copyright

COURT

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION LOCKHART, WILCOX AND SUNDBERG JJ

CATCHWORDS

Copyright - Cinematograph film - Aggregate of visual images and aggregate of sounds embodied in sound-track associated with images - Sounds embodied in sound-track associated with visual images forming part of film deemed not to be sound recording - Whether broadcast of film constitutes broadcast of sound recording.

Copyright Act 1968, ss 10, 23(1), 85, 86, 101(1), 109(1), 110(3), 116(1).

HEARING

SYDNEY, 13 September 1996 #DATE 2:5:1997 #ADD 15:5:1997

Counsel for the Applicants and Phonographic D K Catterns QC, Performance Company of Australia Limited: S J Goddard and R Cobden

Solicitors for the Applicants and Phonographic Performance Company of Australia Limited: Gilbert & Tobin

Counsel for Federation of Australian R J Ellicott QC Commercial Television Stations: and M R Ellicott

Solicitors for Federation of Australian Boyd House Commercial Television Stations: & Partners

ORDER

The Court orders that: 1. the questions reserved for the consideration of the Court be answered as follows: 1. In the circumstances described in pars 7-16 inclusive: (a) did the doing of the act described in par 14 constitute the doing, with respect to a sound recording, of the act set out in s 85(1)(c) of the Act? Answer: No. (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s 152(2) of the Act? Answer: No. 2. In the circumstances described in pars 17-26 inclusive: (a) did the doing of the act described in par 24 constitute the doing, with respect to a sound recording, of the act set out in s 85(1)(c) of the Act? Answer: No. (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s 152(2) of the Act? Answer: No.

2. The applicants and Phonographic Performance Company of Australia Limited pay Federation of Australian Commercial Television Stations' taxed costs of the appeal. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

LOCKHART J 1. An important question of copyright law arises in this matter, namely, if a published sound recording is embodied in the sound-track of a cinematograph film, does the copyright in the sound recording merge in the film, so that the broadcast of the film does not constitute a broadcast of the sound recording? The question turns on the construction of sections of the Copyright Act 1968 ('the Act'), in particular s. 23.

The matter comes to the Court as a reference of questions of law by the Copyright Tribunal, by way of a Stated Case, for the opinion of the Court under s. 161(6) of the Act.
The applicants are record companies which own the copyright in various sound recordings. Phonographic Performance Company of Australia Limited ('PPCA') is a 'collecting society' which administers (as non-exclusive licensee), inter alia, the right to broadcast its licensors' sound recordings ('PPCA sound recordings'). The applicants applied earlier this year to the Tribunal, under s. 152(2) of the Act, for an order determining the amount payable by certain commercial television licensees in respect of the broadcasting of sound recordings controlled by the applicants. Commercial television licensees are represented by the respondent, Federation of Australian Commercial Television Stations ('FACTS').
Under s. 152(7) of the Act, in determining the amount payable by commercial television licensees in respect of the broadcast of sound recordings controlled by the applicants, the Tribunal is required to take into account the extent to which the broadcaster uses, for the purposes of broadcasting, certain records embodying sound recordings in which copyrights subsist, being copyrights owned by persons who are, or who are represented by, parties to the application. To determine the extent of such use, a substantial survey and subsequent detailed analysis will need to be undertaken. The parties to the application requested the Tribunal to refer to the Court the questions of law to which reference will be made later. If the questions are answered favourably to FACTS, then the survey and analysis will be unnecessary and substantial costs will be saved.
The Stated Case describes two sound recordings in which copyright subsists in two separate entities. Copyright also subsists in two cinematograph films each of which embodies one of those two sound recordings as the sound-track to the film.
One of the two sound recordings is entitled 'Dancing in the Storm' and features a performance of the recording group known as 'Boom Crash Opera'. It was made in Australia in 1989 and was first published here in that year. Copyright subsists in the Boom Crash Opera sound recording. The rights comprised within the copyright subsisting in that sound recording include the right specified in s. 85(1)(c) of the Act, namely, the exclusive right to broadcast the sound recording.
The owner of the copyright in the 'Boom Crash Opera' sound recording is BMG Australia Limited which is an applicant to the proceeding before the Tribunal and is represented by PPCA.
Copyright subsists in the cinematograph film entitled 'The Big Steal'. On the making of this film, the 'Boom Crash Opera' sound recording was embodied in its sound-track. The film 'The Big Steal' was broadcast last year by Amalgamated Television Services Pty Limited ('ATS'), the licensee of the commercial television broadcasting service known as ATN-7. ATS is represented in the proceeding before the Tribunal by FACTS. The broadcast by ATS of the film 'The Big Steal' was with the licence of the owner of copyright in that film. (These facts are taken from paragraphs 7 to 16 of the Stated Case.)
The second relevant sound recording is entitled 'Everybody Wants to Rule the World' by a recording group known as 'Tears for Fears' which was made in the United Kingdom in 1984 and first published there in 1985. On the making of a film 'Peter's Friends' that sound recording was embodied in the sound-track of that film. The film 'Peter's Friends' was broadcast on 31 March 1996 by ATS with the licence of the owner of copyright in the film. (These facts are taken from paragraphs 17 to 26 of the Stated Case.)
The questions submitted for determination by the Court are as follows:

1. In the circumstances described in paragraphs 7-16 inclusive (of the Stated Case): (a) did the doing of the act described in paragraph 14 (the broadcasting of the film 'The Big Steal') constitute the doing, with respect to a sound recording, of the act set out in s. 85(1)(c) of the Act? or (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s. 152(2) of the Act? 2. In the circumstances described in paragraphs 17-26 inclusive (of the Stated Case): (a) did the doing of the act described in paragraph 24 [the broadcasting of the film 'Peter's Friends'] constitute the doing, with respect to a sound recording, of the act set out in s. 85(1)(c); or (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s. 152(2) of the Act?

The Act provides for the subsistence of copyright in two classes of works: original literary, dramatic, musical and artistic works (Part III), and subject-matter other than works (Part IV). Subject- matter 'other-than-works' includes copyright in sound recordings and in cinematograph films.

'Sound recording' is defined by s. 10(1) of the Act (the interpretation section) to mean the aggregate of the sounds embodied in a record. A 'record' is defined as meaning a disc, tape, paper or other device in which sounds are embodied.
The expression 'cinematograph film' is defined by s. 10 as meaning the aggregate of the visual images embodied in an article or thing so as to be capable by the use of that article or thing:

(a) of being shown as a moving picture; or (b) of being embodied in another article or thing by the use of which it can be so shown and [importantly for present purposes] includes the aggregate of the sounds embodied in a sound-track associated with such visual images.

'Sound-track' is defined as meaning in relation to visual images forming part of a cinematograph film:

(a) the part of any article or thing, being an article or thing in which those visual images are embodied, in which sounds are embodied; or (b) a disc, tape or other device in which sounds are embodied and which is made available by the maker of the film for use in conjunction with the article or thing in which those visual images are embodied.

Section 89 provides that, subject to the Act, copyright subsists in a sound recording of which the maker was a qualified person at the time when the recording was made for the purposes of Part IV (of which s. 89 forms part). A 'qualified person' means, inter alia, an Australian citizen or a person other than a body corporate resident in Australia or a body corporate incorporated under a law of the Commonwealth or of a State. Section 85 defines the nature of the exclusive rights enjoyed by the owner of copyright in a sound recording, including the right to broadcast the recording (s. 85(1)(c)).

Section 23(1) of the Act is critical to the determination of the questions before the Court. It provides:

'For the purposes of this Act, sounds embodied in a sound-track associated with visual images forming part of cinematograph film shall be deemed not to be a sound recording.'

The applicants and PPCA contend that s. 23(1) does not extinguish copyright in the sound recording. It is designed to ensure that two copyrights do not subsist in the same subject-matter. In other words, the same aggregate of sounds cannot support two separate copyrights: one as part of a cinematograph film and the other as a sound recording.

FACTS contends that s. 23(1) has the effect of excluding a sound- track from the definition of 'sound recording' for the purposes of the Act, so that the broadcast of the film could not constitute the broadcast of a sound recording.
It is necessary to consider the history of s. 23 and other relevant sections of the Act, both to determine the purpose served by the section in the scheme of the Act and to resolve any ambiguity concerning its meaning. In my view an analysis of the history makes the meaning of s. 23(1) clear.
Whether sound recordings should be protected by copyright law has been for many years the subject of high controversy. In the United States sound recordings were not protected by the Copyright Act 1909 of the United States and until 1972 were protected only by State anti- piracy laws. Bowen C.J. reviewed the history of the relevant American legislation in CBS Records Australia Limited v Telmak Teleproducts (Aust) Pty Limited (1987) 9 IPR 440 at 444-445. The primary reason for not conferring copyright protection upon sound recordings (the view that previously held sway, but has since become largely discredited) was that the making of sound recordings was thought to be a mechanical task, not involving any original or creative thinking, although the expression of it may cause copyright to subsist in original literary, dramatic, musical or artistic works.
The first exercise by the Commonwealth of the power to make laws with respect to copyright (s. 51(xviii) of the Constitution) was the enactment by the Commonwealth Parliament of the Copyright Act passed in 1905. That Act superseded legislation which had been enacted in the various colonies concerning copyright matters prior to the foundation of the Commonwealth. The 1905 Act was based upon the provisions of a Bill which had been introduced into the House of Lords in 1900 but had not become law. The Parliament of the United Kingdom later enacted the Copyright Act 1911. The Copyright Act 1912 (Cth) provided (by s. 8) that the Copyright Act 1911 (UK) shall, subject to any modifications provided by the Australian Act, be in force in Australia. The Copyright Act 1911 (UK) was set out in the Schedule to the Australian Act of 1912 and was treated as being in force in Australia. That law governed copyright in Australia until the enactment of the Copyright Act 1968, subject to some minor amendments made to the Australian Act of 1912 in 1933, 1935 and 1950.
In the United Kingdom, s. 19(1) of the Copyright Act 1911 provided that copyright subsisted in:

'records, perforated rolls and other contrivances by means of which sounds may be mechanically reproduced, in like manner as if such contrivances were musical works'.

It was held by Maugham J. in 1934 in Gramophone Co Limited v Carwardine & Co [1934] Ch 450 that s. 19(1) established a performing right in records, contrary to the view which had previously prevailed that the subsection did no more than confer a right to prevent unauthorized copying of records. Lowe J. of the Supreme Court of Victoria expressed the same view in Australasian Performing Right Association Limited v 3 DB Broadcasting Co Pty Limited [1929] VLR 107 at 113.

The Gregory Committee was appointed in the United Kingdom in 1951 to consider whether any, and if so what, changes were desirable in copyright law concerning literary, dramatic, musical, artistic works, with particular regard to technical developments (see the terms of reference as outlined in the first paragraph of the preliminary section of the Report of the Gregory Committee). The Committee noted (paras. 96 and 97) that under the law as it then stood in the United Kingdom there were several copyrights which could subsist in various parts of a cinematograph film: including copyright vested in the author of the actual film script, the author of the story on which it is based and the composer of incidental music.
The Committee recommended (para. 101) that a film together with its sound-track, if any, should be regarded as a distinct type of work in which a distinct copyright may subsist; and that such copyright should subsist in the film as a whole and relate both to copying the film and to its performance in public. It said that, if there should be any other copyrights subsisting in any parts of the film (eg. in any individual photograph, or the story on which it is based, its own particular script or in its music), these should be independent of the 'film copyright' (para. 101).
The Committee also recommended (para. 35) that the performing right in gramophone records as confirmed by the Carwardine Case should be maintained.
The report of the Gregory Committee formed the basis of the revision of the Copyright Act 1911 in the United Kingdom and was incorporated in the 1956 Copyright Bill with minor exceptions (see the Second Reading Speech in the House of Commons, 4 June 1956 by the President of the Board of Trade, Mr Peter Thorneycroft, Hansard 715).
In introducing the Bill for its second reading, Mr Thorneycroft said:

'The object of the Bill is to try to seek a fair balance between the authors, the composers, the librarians, the record makers, the broadcasting authorities, the purveyors of entertainment and, last, but by no means least, the general public, the readers, students and the millions who enjoy television in their own homes.' (Hansard 717)

and

'They [films] stand under the existing law; whereas I am here referring to a new right. They stand in a position whereby various rights exist in the parts of which the films are composed. These will come to an end at various times, depending on the life of the author. It was because of the complexity of this system that it was thought better in future to erect a new right, to which I have been referring in films. For the first time, there will be not only a conglomeration of rights in the parts which go to make up a film, but a new right of 50 years in the film itself.' (Hansard 718).

Mr Thorneycroft referred to the fact that record makers enjoyed at that time in the United Kingdom and would continue to enjoy two rights: first, the right to prevent the copying of their records and secondly, the right to control their public performance. He said that the first of those two rights has always been uncontroversial and that it was generally accepted that the record maker should have that right. He said that the second right (to control public performances) was more controversial and, indeed, may originally have been given by accident. He noted that the Copyright Committee had come down in favour of continuing that right subject to certain safeguards (Hansard, 719).

The 1911 Act of the United Kingdom was repealed by the Copyright Act 1956 (UK). Part II of the 1956 Act dealt with copyright in, amongst other things, sound recordings and cinematograph films.
Section 12 of the 1956 Act dealt with copyright in sound recordings.
Sub-section (5) of s. 12 relevantly provided as follows:

'(5) The acts restricted by the copyright in a sound recording are the following, whether a record embodying the recording is utilized directly or indirectly in doing them, that is to say, - (a) making a record embodying a recording; (b) causing the record to be heard in public; (c) broadcasting the recording.'

Sub-section (9) of s. 12 is important. It provided that in the 1956 Act 'sound recording' meant the aggregate of the sounds embodied in, and capable of being reproduced by means of, a record of any description, other than a sound-track associated with a cinematograph film; and 'publication', in relation to a sound recording, means the issue to the public of records embodying the recording or any part thereof. (The emphasis is mine.)

Section 13(9) provided that:

'For the purposes of this Act a cinematograph film shall be taken to include the sounds embodied in any sound-track associated with the film, and references to a copy of a cinematograph film shall be construed accordingly: Provided that where those sounds are also embodied in a record, other than such a sound-track or a record derived (directly or indirectly) from such a sound-track, the copyright in the film is not infringed by any use made of that record.' (cf. s. 110(3) of the Copyright Act 1968 (Cth)).

Section 13(10) of the 1956 Act (UK) defined a 'cinematograph film' as meaning:

'any sequence of visual images recorded on material of any description (whether translucent or not) so as to be capable, by the use of that material - (a) of being shown as a moving picture, or (b) of being recorded on other material (whether translucent or not), by the use of which it can be so shown;'

Thus, the purpose of the Copyright Act 1956 of the United Kingdom, relevant to the question presently before the Court, was to establish a new right to copyright in a cinematograph film. Under the earlier law a film was regarded merely as a 'conglomeration' of various rights which exist in the components of a film including copyright in the original literary works vested in the authors of the script, in the owners of the dramatic works, in the musical works such as the musical score, in photographs and in artistic works.

But it was not intended that the establishment of a new copyright in the film itself would diminish the rights of the owners of copyright in the various parts which go to make up the film. The new copyright in the cinematograph film would restrict persons, without the authority of the owner of copyright in the film; not only from making a copy of the film, but from causing it in so far as it consisted of visual images to be seen in public or, in so far as it consisted of sounds to be heard in public, from, inter alia, broadcasting the film (s. 13(5)). But the rights vested in the owners of copyright in the various parts which constituted the film would continue to subsist; for example, the owner of copyright in the sound recording would not only have the uncontroversial right to prevent copying of the records, but in addition the right to control its public performance.
Also, copyright in the cinematograph film included the sound- track associated with it. Thus, the owner of copyright in the film could prevent unauthorized use of the sound-track including causing the film, so far as it consisted of visual images, to be seen in public or, in so far as it consisted of sounds, to be heard in public, and to prevent the broadcasting of the film. But the owner of the film did not have copyright in the sound recording; the copyright that subsisted in the sound recording was to continue. This is manifested by the definition of 'sound recording' in s. 12(9) of the 1956 Act as excluding a sound-track associated with a cinematograph film.
It is plain that the framers of the 1956 Act had no intention of vesting the owner of the copyright in the film (itself a newly created right) with other copyrights; and it is equally plain that it was intended that the copyrights which previously subsisted, including the copyright in the sound recording, should continue to subsist.
With this background in mind I turn to the Australian position after the enactment of the 1956 Act of the United Kingdom.
In 1958 a committee (the Spicer Committee) was appointed by the Commonwealth Attorney-General to examine the copyright law of Australia and to advise which of the amendments made in the law of copyright in the United Kingdom should be incorporated into Australian copyright law and what other alterations or additions should be made to that law.
Notwithstanding the repeal of the Copyright Act 1911 (UK), the Copyright Act 1956 (UK) contained provisions preserving the operation of the 1911 Act in so far as it formed part of the law of any country other than the United Kingdom (s. 50 and paragraph 41 of the Seventh Schedule). Having regard to those provisions the Copyright Act 1911 remained law in the Commonwealth of Australia: Copyright Owners' Reproduction Society Limited v EMI (Australia) Pty Limited (1959) ALR 127.
The Spicer Committee stated (paragraph 23 of its report) that one of the first problems to be solved was whether the Copyright Act 1956 (UK) should in substance form the basis of an Act to be passed by the Commonwealth Parliament or whether an entirely different Act should be framed. The Committee accepted the United Kingdom Act as the basis of its examination of the problems raised for its consideration (para. 25). It noted (para. 27) that the copyright in records conferred by the 1911 Act was re-enacted in a different form (s. 12 of the 1956 Act) with provisions expressly including in the copyright the right of causing a recording to be heard in public and to broadcast the record. The corresponding section (s. 19 of the 1911 Act) did not expressly refer to those elements, but, as mentioned earlier, the section was interpreted by Maugham J. in Carwardine's Case as including such rights (para. 27).
The Spicer Committee recommended (para. 226) the creation or continuance of copyright in subject-matters that were not themselves original literary, dramatic, musical or artistic works. For example, one of the acts that should be restricted by ownership of copyright in a sound recording was the public performance of the record. So, a person who wished to publicly perform such a record must obtain the consent of the owner of the copyright in the record. The Committee said (para. 232) that there was a strenuous contest about whether the maker of a record should have the right to restrain the public performance or broadcasting of his record; in other words, whether paragraphs (b) and (c) of s. 12(5) of the 1956 Act should be adopted here in so far as they covered records not made in infringement of copyright. The Committee said (para. 233) that, although some countries had conferred such a right, many countries, including the USA, have denied it; and that no international convention required Great Britain or Australia to confer upon the makers of sound recordings any of the rights referred to in s. 12(5)(a), (b) and (c) of the 1956 Act.
It was contended before the Spicer Committee that the maker of a sound recording should not have the right to control the public performance or broadcasting of such recording; but should be confined to the right to sell his recordings. The Committee noted (at para. 237) that the business of selling records, it was said, had in recent years been very greatly expanded and was then very profitable. Submissions supporting the denial of the right were put by the Australian Broadcasting Commission and by Australian Commercial Broadcasters, both of which use large numbers of records.
The Spicer Committee noted (para. 238), inter alia, that to concede to the maker of a sound recording the right to restrict public performance of a recording would be to oblige those who perform the recording in public or who broadcast it to obtain, not only a licence from the owner of copyright in the record, but also from the owner of copyright in the work recorded. Also, the great majority of records sold here were imported either directly or by the importation of matrices from which records were pressed in Australia, many of which came from the USA; and it seemed anomalous that the maker of a sound recording in USA should enjoy here a performing right in the recording which it did not enjoy in his own country. The figures before the Committee showed that almost 65% of recordings released in Australia were manufactured from original masters made in the USA; only 20% were made from masters of English origin; 13% from Continental masters; and about 4% were produced locally. Arguments pressed by the broadcasting interests were noted at para. 239 of the Spicer Committee Report, namely:

(a) The right was not intentionally conferred and was not supposed to exist until the Carwardine Case; (b) The maker of a record makes no artistic contribution to the original, still less does a person who merely presses a record from a matrix made outside Australia. Such persons did no more than carry out an industrial process and were in no different position from the printer of a book. (c) Australian conditions differed from those in England as there was very little original recording done in Australia. (d) Broadcasting did not affect adversely the sale of gramophone records, but on the contrary, greatly promoted them. The prosperous state of the record industry was mainly attributable, it was said, to the broadcasting of records.

The Committee noted (para. 240) that the record manufacturers submitted, inter alia:

(a) The production of a recording required a great deal of technical skill, but it required much more: the selection of the conductor, the composition of an orchestra, selection and training of musicians, the placing of microphones, the control of sound, all of which played a part in the recording, so there may well have been great differences between recordings. There was also a considerable outlay of money. (b) Since the 1911 Act there had been great changes in the uses to which recordings could be put. (c) The widespread dissemination of the recording lowered its value and could cause loss in value by reducing sales. (d) There had been a large capital investment in the record industry and there was an expectation of recoupment, in part by royalties from public performance. It would have been unjust to have limited the source from which revenue could be derived. It would probably have led to an increase in the retail price of records if manufacturers were to be confined to such sales for revenue. (e) The Gregory Report recommended (para. 184) that the right be retained.

The Spicer Committee recommended that no change should be made in the law. It was of the view that the making of a record did involve a considerable amount of artistic and technical skills (para. 241). It said (para. 242) that it did not think that the result of another person's effort and skill should be made available to wide audiences by means of broadcasting or public performance without any payment being made to that person; and agreed with the statement of the Gregory Committee in its report (para. 185):

'There would be something at variance with ordinary ideas of justice and fair play if an entertainment promoter, for his own personal profit, were to be at liberty to make use of records for broadcast programmes without any control or payment whatsoever, nor do we believe that it would be in the interests of the general public that he should do so.'

The Committee recommended (para. 256) that copyright should subsist in every sound recording of which the maker was a 'qualified person' when the record was made and in recordings that were first published in Australia. It recommended (para. 260) that the following acts should be restricted: (a) making a record embodying the recording; (b) causing the recording to be heard in public; and (c) broadcasting the recording.

The Spicer Committee noted (para. 265) that Article 14(2) of the Rome Convention provided for the protection of cinematograph productions 'if the author has given the work an original character'. It noted (para. 266) that in the Brussels Convention that article has been deleted by Article 2 of the Convention: 'cinematographic works and works produced by a process analogous to cinematography' were included in the term 'literary and artistic works' and are entitled to protection accordingly. The Spicer Committee said (para. 267) that the Universal Copyright Convention required adequate and effective protection of the rights of authors and other copyright proprietors in certain works including 'cinematographic works'.
It recommended (para. 268) that it was appropriate that a particular copyright in cinematograph films should be created with its own special term of protection. The Committee said (para. 272), a revealing paragraph for present purposes, that, if its recommendations were put into effect, copyright in a film would subsist as such independently of any copyright subsisting in its component features. It approved (para. 273) the principle of s. 13(4) that the maker of the film should be the first owner of copyright. It noted (para. 274) that the acts restricted by copyright in a film should be those set out in s. 13(5) of the 1956 Act, namely, (a) making copy of the film; (b) causing the film in so far as it consists of visual images, to be seen in public, or in so far as it contains sounds to be heard in public; (c) broadcasting the film; and (d) causing the film to be transmitted to subscribers to a diffusion service.
Pausing here, it is clear therefore that the Spicer Committee intended the new Australian copyright legislation to basically follow the principles relating to films and sound recordings provided for in the Copyright Act 1956 (UK) though with some qualifications which are not material for present purposes.
I mention again, at the risk of repetition, that in the opinion of the Committee copyright in the film should subsist independently of any copyright in the parts from which it is made and which subsist therein.
I turn now to the changes to Australian copyright law after the making of the Spicer Committee Report.
A ministerial statement was made to the House of Representatives by the then Attorney-General (the Honourable Billy Snedden) on 20 April 1966. He is recorded (Hansard at p. 971) as saying that the purpose of the statement was to outline to the House the nature of the Copyright Bill that he expected to introduce in the Budget Session that year. After noting that the then existing law gave the manufacturer of a record a right to control the public performance and broadcasting of his records he is recorded as saying (p. 974) that only some countries granted such a right to the record manufacturer. For example, the right does not exist in the USA. Under the 1956 UK Act the right is continued but it does not extend to records originating in a country which does not grant that right.
He continued (at 974):

'There is, in my view, no justification for granting these rights in respect of records which originate from countries which do not grant such rights. But, as regards records generally, I do not think that record manufacturers should be given a right which would clearly entitle them to collect royalties they do not now receive from commercial broadcasting stations. On the other hand, I recognize that there is a case for allowing the record manufacturers to restrict the playing of their records before the date on which the records are released on the market for retail sales. The Bill will, therefore, give to the owner of the copyright in a sound recording a limited right to restrict the broadcasting or other public performance of a record before its release for retail sale but will not give him any rights to collect royalties in respect of the public performance or broadcasting of that record.'

On 18 May 1967 the then Attorney-General, the Honourable Nigel Bowen, introduced the Copyright Bill 1967 into the House of Representatives. In his Second Reading Speech Mr Bowen said (p. 2328 of Hansard) that the Bill would give effect in part to the Convention for the Protection of the Producers of Phonograms, Broadcasters and Performers, commonly known as the Neighbouring Rights Convention which was signed at Rome in 1961 and came into force in 1964. It required certain rights to be given to record manufacturers, to broadcasters and to performers of musical and dramatic works. Mr Bowen said that the Bill would give effect to that Convention in so far as it related to records and broadcasts; that these matters were dealt with in the United Kingdom Copyright Act 1956 and it was appropriate to deal with them in the Australian Bill.

Mr Bowen when referring to the statement to the House of Representatives made by Mr Snedden on 20 April 1966 said that Mr Snedden had then:

'... announced the Government's intention to legislate substantially in terms of the recommendations of the Spicer Committee, but with some significant modifications.'

Because of the substantial ramifications of the modifications and other matters Mr Bowen announced that it was his intention that the Bill should 'lie over' until the Budget Session. He said (at Hansard 2328):

'Generally speaking, the Bill confirms the rights given to authors, composers and creative artists by the existing law and specifically extends these to cover the new media of reproduction, such as broadcasting. It confers a number of new rights, particularly in respect of broadcasts, cinematograph films and printed editions of books. In doing so, the Bill adopts, in the main, the recommendations of the Spicer Committee. But it does depart from the recommendations of that Committee in a number of cases where changes in circumstances since the Committee reported have made this necessary or where, on its own examination of the Australian circumstances, the Government has thought it desirable to do so.'

Mr Bowen turned to the provisions of the Bill which provided for the subsistence of copyright in sound recordings and cinematograph films (Hansard 2,332), provisions found in clauses 84 to 112 of the Bill.

He referred to the then existing law whereby sound recordings were not protected as such or in their own right but as though they were original musical works:

'that is, a sound recording is protected against copying and it is also protected against unauthorized use of the recording for the purposes of public performance or broadcasting. Thus a person who uses a record for broadcasting under the present law must have permission from two sources. He must have permission from the owner of the copyright in the music which is embodied in the record, and he must have permission from the owner of the copyright in the record itself. ...'

He said that:

'Under the present law, a cinematograph film is not protected as such. It has limited protection in two ways: firstly, the photographs which make up the film are each protected as an artistic work and, secondly, if the arrangement or acting form or the combination of incidents represented in the film gives the work an original character it is protected as a dramatic work. The Bill establishes a separate protection for cinematograph films as such, and, in general, vests the ownership of the copyright in the maker of the film.

The Attorney-General referred to the fact that there had been 'much controversy concerning the extent of the rights that should be granted in relation to a sound recording'. After mentioning that no- one had disputed that the person who makes a recording should be entitled to prevent others from copying it, he said that what has been in dispute is whether the maker should be entitled to prevent others from playing the record in public or from broadcasting it. He said (Hansard 2,333) that:

'It was announced last year that the Government had come to the conclusion, on the information which it then had, that there should be no performing right at all in a record after it had been released in Australia. Since then, my attention has been drawn to recent legislation in a number of other countries in which this right has been given, and to the effect on the earnings to be derived from Australian records in the United Kingdom and elsewhere, since such rights are usually given only on the basis of reciprocity. In addition, further consideration has suggested that it would be inconsistent with what is done elsewhere in the Bill in the way of confirming existing rights in other respects, to deprive record manufacturers of a right which has continued for so long under the existing law. Accordingly, the matter has been reconsidered and it has been decided to give certain rights in respect of the broadcasting or other public performance of records, but in a more limited way than recommended by the Spicer Committee.'

The Attorney-General then described the rights given by the Bill to the owner of the copyright in a record including complete protection against copying of the record; the exclusive right to control the use of the record for public performance or for broadcasting up to the date on which the record is released for sale in Australia; after which there would be no right to control the public performance or broadcasting of the record but, if the record is performed in public or broadcast, the copyright owner would have the right to be paid a royalty in respect of that use of the record. The royalty was to be such as may be agreed on by the parties or in default of agreement as was determined by the Copyright Tribunal so that after the record was released in Australia the maker of the record had a right to royalties only.

At a time when Parliament, after lengthy consideration, had decided to grant broadcasting and public performance rights to copyright owners of sound recordings, it would be surprising if those rights were to be curtailed in respect of sound recordings within films without any discussion.
The 1967 Copyright Bill did contain provisions granting rights of public performance and broadcasting in sound recordings and included the following definitions:

'"sound recording" means the aggregate of the sounds embodied in a record, not being sounds embodied in a sound-track associated with visual images forming part of a cinematograph film' (my emphasis); '"cinematograph film" means the aggregate of visual images embodied in material of any kind so as to be capable by the use of that material: (a) of being shown as a moving picture; or (b) of being embodied in other material by the use of which it can be so shown and includes the aggregate of sounds embodied in a sound-track associated with such visual images' (my emphasis).

It can be seen therefore that the 1967 Copyright Bill adopted substantially the same approach as was embodied in the relevant provisions of the 1956 Copyright Act (UK) where it will be remembered the definition of 'sound recording' in s. 12(9) also excluded from that definition a sound-track associated with the cinematographic film. Also the combination of s. 13(9) and (10) of the 1956 Act (UK) had the same effect as the definition of 'cinematograph film' in the Australian Bill.

Thus, prior to the 1956 Act in the United Kingdom no copyright subsisted in the film considered as a work in itself. Previously there were several copyrights subsisting in the various matters which went to make up a film: for example, the sound-track, the underlying sound recording, the script, the photograph. These several copyrights continued to subsist after 1956; but, in addition the film itself including the sound-track, if it had one, became a subject matter of copyright.
In my opinion the evident intent of the 1956 Act of the United Kingdom and the Copyright Bills of 1967 and 1968 in Australia was for relevant purposes the same. The Australian Bill did not seek to bring about a change in the Australian law from that which subsisted in England after the enactment of 1956 Act in the United Kingdom. Copyright in the cinematograph film included, not only the aggregate of visual images embodied in the film, but also the aggregate of the sounds embodied in the sound-track associated with such visual images. The copyright that existed in the cinematograph film was distinct from the copyright that existed and continued to exist as it had before in its various components.
The 1967 Copyright Bill lapsed and Parliament was prorogued. On 16 May 1968 the Attorney-General, Mr Nigel Bowen, introduced the Copyright Bill 1968 into the House.
The definition of 'sound recording' was amended in the 1968 Bill to delete the words 'not being sounds embodied in a sound-track associated with visual images forming part of a cinematograph film' (my emphasis) and s. 23(1) was introduced under the heading 'Sound Recordings and Records' in the form which it presently takes and has been set out earlier.
Before he introduced the Copyright Bill 1968 into the House of Representatives, Mr Bowen circulated a document titled 'Memorandum showing alterations made to the Copyright Bill 1967 as presented to the House of Representatives on 18 May 1967'. That memorandum contained amended definitions for 'cinematograph film' and 'sound recording' and contained s.Ê23(1), all in the form in which they now appear in the Act. The memorandum contained no explanation as to why any of the amendments were proposed.
The Second Reading Speech of Mr Bowen and the debate that followed did not mention the change in the definition of 'sound recording' and the insertion of s. 23(1).
In my opinion the effect of the amended definition of 'sound recording', combined with s. 23(1), was intended to achieve the same result as the previous definition of 'sound recording' in the 1967 Bill. Parliament did not intend in my view that there would be any change in the rights granted to the producers of sound recordings as between the Copyright Bill 1967 and the Copyright Bill 1968, this being consistent with s. 12(9) of the UK Act of 1956, mentioned earlier, which excluded from the definition of 'sound recording' a 'sound-track associated with a cinematograph film'.
This review of the history of the relevant amendments made by the Act of 1968 leads to the conclusion that a sound-track associated with a cinematograph film is excluded from the definition of 'sound recording', thus ensuring that the owner of the copyright in the film does not have vested in him the further right of copyright in the sound recording. If it were not for s. 23(1) then, since 'sound recording' is defined in the 1968 Act as meaning the aggregate of the sounds embodied in a record, it would necessarily follow that the 'sound-track' of the film is a sound recording because sounds as well as the visual images are embodied in the film. It will be remembered that 'cinematograph film' is defined in s. 10 of the Act as including the aggregate of the sounds embodied in the sound-track. Thus absent s. 23(1), the film would be a 'sound recording' within the meaning of the definition of that expression in the Act and thus give rise to a second copyright in the owner of the copyright in the film.
I cannot accept that this was the result intended by the amendments made by the Act in 1968 notwithstanding the language of s. 23(1) itself. The view contended for on behalf of the respondents would lead to a construction of the Act which throws overboard the previous legislative intent, both in Australia and the United Kingdom to create a new copyright in the film, but leave intact and subsisting the copyrights which exist independently of the film and, importantly, not vest in the owner of copyright in the film an additional copyright in the sound recording.
The construction for which the respondents contend would divest the owners of the copyright in the sound recording of the right once embodied in the sound-track which is a necessary part of the film (assuming the film has a sound-track). This cannot be the correct construction. Just as the owner of copyright in the film can control the use of the film for public performance or broadcasting, so can the owner of copyright in the sound recording continue to have his rights including the right of payment of royalties in respect of the use of the sound recording.
It is also significant to note the definition in s. 10 of the expression 'infringing copy' as meaning in relation to a sound recording:

'(b) ...a copy of the sound recording not being a sound-track associated with visual images forming part of a cinematograph film'.

This definition of infringing copy in my opinion supports the conclusion that copyright exists in the sound recording notwithstanding that it has been embodied in the sound-track of the film. In short, the owner of the copyright in the film has rights with respect to copyright in the sound-track but not in the sound recording; they remain with the owner of copyright in the sound recording.

Nowhere in the history of s. 23 have I been able to discern any view to the contrary. Sub-section (1) of s. 23 means simply that copyright in the film includes the copyright in respect of the sound- track which is a necessary part of the film (assuming there is a sound-track); and those sounds embodied in the sound-track shall not be a sound recording, because if they were there would be a second copyright subsisting in the owner of the copyright in the film, namely, rights as the owner of copyright in the sound recording. But those rights are held elsewhere, namely, by the owner of the copyright in the sound recording.
In my opinion s. 23(1) is designed to prevent two copyrights subsisting in the same subject matter, namely, copyright subsisting in the same aggregate of sounds both as part of a cinematograph film (itself a combination of images and sounds) and as a sound recording.
The view which appeals to me is consistent with Copinger & Skone James on Copyright, 12th and 13th ed., 12th ed. para. 859 and 13th ed. para. 2-29. See also Laddie Prescott & Vitoria, The Modern Law of Copyright, 2nd ed., para. 5.20.
Against this view, counsel for FACTS relied on s 110(2) which reads:

Where, by virtue of this Part, copyright has subsisted in a cinematograph film, a person who, after that copyright has expired, causes the film to be seen or heard, or to be seen and heard, in public does not, by so doing, infringe any copyright subsisting by virtue of Part III in a literary, dramatic, musical or artistic work.

Counsel argued that this provision, since it only refers to Part III works, implies that copyright in a sound recording does not subsist in the film. However, a closer analysis reveals that it is unnecessary to refer to sound recordings. This provision was enacted to deal with circumstances where the copyright in the underlying works continues after copyright in the film expires. Copyright in an underlying sound recording will invariably expire at the same time or before copyright in the film expires. In the ordinary course, a sound recording will be published before the film; but even if the sound recording had not been previously published, the publication of the film would constitute publication of the sound recording (see s 29).

Another section relied upon by counsel for FACTS was s 110(3) which states:

'Where the sounds that are embodied in a sound-track associated with the visual images forming part of a cinematograph film are also embodied in a record, other than such a sound-track or a record derived directly or indirectly from such a sound-track, the copyright in the cinematograph film is not infringed by any use made of that record.'

In my opinion the effect of this section is to prevent doubt that any use of a sound recording which is also embodied in a sound-track is not an infringement of a film. Such a result would be possible if it were considered that a sound recording was a substantial reproduction of a film. This section does not imply, as FACTS contended, that a record derived from a sound-track does not infringe the sound-recording, but only infringes the film. Rather, the effect is that such a record also infringes the film.

My interpretation of s. 23 is reinforced by s. 113 which reads as follows:

'(1) Subject to subsection 110(2), where copyright subsists in any subject-matter by virtue of this Part, nothing in this Part shall be taken to affect the operation of Part III in relation to any literary, dramatic, musical or artistic work from which that subject-matter is wholly or partly derived, and any copyright subsisting by virtue of this Part is in addition to, and independent of, any copyright subsisting by virtue of Part III. (2) The subsistence of copyright under any provision of this Part does not affect the operation of any other provision of this Part under which copyright can subsist.'

Thus copyright in each work that is part of the film subsists independently of the copyright in the film (s. 113(1)); and copyright in a sound recording that is used for the sound-track of a film subsists independently of the copyright in the film (s. 113(2)). Conclusion

I would answer the questions referred by the Tribunal to the Court as follows:

Question 1 In the circumstances described in paragraphs 7-16 inclusive: (a) did the doing of the act described in paragraph 14 (the broadcasting of the film 'The Big Steal') constitute the doing, with respect to a sound recording, of the acts set out in s. 85(1)(c) of the Act; or (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s. 152(2) of the Act? Answer (a) Yes (b) It is not necessary to answer this question since it is phrased as alternative to (a). Question 2 In the circumstances described in paragraphs 7-26 inclusive: (a) did the doing of the acts described in paragraph 24 [the broadcasting of the film 'Peter's Friends' by ATS] constitute the doing, with respect to a sound recording, of the acts set out in s. 85(1)(c); or (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of s. 152(2) of the Act? Answer (a) Yes (b) It is not necessary to answer this question since it is phrased as alternative to (a).

I would order FACTS to pay the costs of the applicants and PPCA of the reference. WILCOX and SUNDBERG JJ Background

In March 1996 EMI Music Australia Pty Ltd and twenty one other owners of copyright in published sound recordings ("the applicants") applied to the Copyright Tribunal for orders under s 152 of the Copyright Act 1968 ("the Act") determining the amount payable by commercial television licensees in respect of the broadcasting of the recordings. Phonographic Performance Company of Australia Limited ("PPCA") and Federation of Australian Commercial Television Stations ("FACTS") were joined as parties to the application. PPCA is a "collecting society" which administers (as non-exclusive licensee) the right to broadcast its licensors' sound recordings. FACTS represents the commercial television broadcasters which the applicants and PPCA assert should be bound by the orders sought.
In their amended application the applicants allege that each of them is the owner of a copyright in a published sound recording within the meaning of s 152(3) of the Act, and has licensed PPCA with respect to its rights in all sound recordings controlled by it (whether as owner of the copyright or exclusive licensee) to grant non-exclusive licences to persons in Australia to broadcast the sound recordings in Australia and to cause the recordings to be heard in public in Australia. They request the Tribunal to determine under s 152 that the amount payable by the commercial television licensees is the amount calculated in accordance with a draft licence agreement annexed to the application, and to specify the members of PPCA between whom the amount is to be divided.
Under clause 5.1 of the draft agreement the amount payable by each broadcaster is 0.12 per cent of its gross revenue for the financial year ending during the immediately preceding licence year. Stated Case
On 13 June 1996 at the request of the parties the Tribunal stated a case for the consideration of this Court. After referring to the application before it, the Case continues:

4. Under section 152(7) of the Act, in determining the Rate, the Copyright Tribunal is required to take into account the extent to which the broadcaster uses for the purposes of broadcasting sound recordings owned by persons who are, or who are represented by, parties to the Application. In order to determine the extent of such use, a substantial survey and subsequent detailed analysis will need to be undertaken. ... 6. The resolution of the questions set out in Part 4 will have a substantial impact upon the scope of both the survey referred to in paragraph 4 and the subsequent hearing before the Copyright Tribunal ....

Under the heading "Synchronisation of Australian Recording" the Case states:

7. The sound recording featuring a performance of the recording group known as "Boom Crash Opera" and entitled "Dancing in The Storm" ("Boom Crash Opera Sound Recording") was made in Australia in 1989 and was first published in Australia in 1989. 8. Copyright subsists in the Boom Crash Opera Sound Recording. 9. The rights comprised within the copyright subsisting in the Boom Crash Opera Sound Recording include the right specified in section 85(1)(c) of the Copyright Act 1968. 10. The owner of the copyright in the Boom Crash Opera Sound Recording is BMG Australia Limited. 11. BMG Australia Limited is an applicant to these proceedings and is represented in these proceedings by PPCA. 12. Copyright subsists in the cinematograph film entitled "The Big Steal". 13. The Boom Crash Opera Sound Recording was, on the making of the film "The Big Steal", embodied in the sound-track to that film. 14. The film "The Big Steal" was broadcast on 21 October 1995 by Amalgamated Television Services Pty Limited ("ATS"), the licensee of the commercial television broadcasting service known by the call sign "ATN7". 15. ATS is represented in these proceedings by FACTS. 16. The broadcast of the film "The Big Steal" by ATS was with the licence of the owner of the copyright in that film.

Paragraphs 17 to 26 of the Case, under the heading "Synchronisation of UK Recording", set out facts relating to a sound recording made and first published in the United Kingdom entitled "Everybody Wants to Rule the World" which was embodied in the sound- track of the film "Peter's Friends" broadcast in Australia by ATS. The scheme of these paragraphs is the same as that in paragraphs 7 to 16.

The questions for determination in relation to the Australian recording are:

(a) did the doing of the act described in paragraph 14 constitute the doing, with respect to a sound recording, of the act set out in section 85(1)(c) of the Act? or (b) in the alternative, did it constitute the broadcast of a published sound recording for the purposes of section 152(2) of the Act?

The questions for determination in relation to the United Kingdom recording are in the same form. The legislation

Part IV of the Act deals with copyright in subject-matter other than works, and consists of ss 84 to 113. Section 85 provides that unless the contrary intention appears, copyright in relation to a sound recording is the exclusive right, amongst other things, to broadcast the recording: sub-s (1)(c). The expression "sound recording" is defined in s 10 as "the aggregate of the sounds embodied in a record". The word "record" means "a disc, tape, paper or other device in which sounds are embodied". Section 86 provides that unless the contrary intention appears, copyright in a cinematograph film is the exclusive right, amongst other things, to broadcast the film: par (c). The expression "cinematograph film" is defined in s 10 as

the aggregate of the visual images embodied in an article or thing so as to be capable by the use of that article or thing - (a) of being shown as a moving picture; or (b) of being embodied in another article or thing by the use of which it can be so shown, and includes the aggregate of the sounds embodied in a sound-track associated with such visual images ....

The same section defines the expression "sound-track", in relation to visual images forming part of a cinematograph film, as

(a) the part of any article or thing, being an article or thing in which those visual images are embodied, in which sounds are embodied; or (b) a disc, tape or other device in which sounds are embodied and which is made available by the maker of the film for use in conjunction with the article or thing in which those visual images are embodied.

Section 23(1) provides:

For the purposes of this Act, sounds embodied in a sound-track associated with visual images forming part of [a] cinematograph film shall be deemed not to be a sound recording.

Section 101(1) provides that a copyright subsisting by virtue of Part IV is infringed by a person who, not being the owner of the copyright, and without the licence of the owner, does in Australia any act comprised in the copyright. Section 109(1) provides in part that

the copyright in a published sound recording is not infringed by the making of a broadcast of that recording if - (a) where there is no order of the Tribunal in force under section 152 applying to the maker of that broadcast in relation to the time when that broadcast was made - the maker of that broadcast has given an undertaking in writing to the person who is the owner of the copyright in that recording to pay to the owner such amounts (if any) as may be specified in, or determined in accordance with, an order of the Tribunal made under that section in respect of the broadcasting by the maker, during a period within which that broadcast was made, of published sound recordings in which the copyrights are owned by that person and which include that recording; or (b) where there is an order of the Tribunal in force under that section applying to the maker of that broadcast in relation to the time when that broadcast was made - (i) the copyright in that recording is owned by a person who is specified in the order as one of the persons among whom the amount specified in, or determined in accordance with, the order is to be divided and the maker of the broadcast makes payment to the person in accordance with the order ....

Section 152(2) provides:

Subject to this section, an application may be made to the Tribunal for an order determining, or making provision for determining, the amount payable by a broadcaster to the owners of copyrights in published sound recordings in respect of the broadcasting, during a period specified in the application, of those recordings by that broadcaster.

Section 110(3) provides:

Where the sounds that are embodied in a sound track associated with the visual images forming part of a cinematograph film are also embodied in a record, other than such a sound-track or a record derived directly or indirectly from such a sound track, the copyright in the cinematograph film is not infringed by any use made of that record.

Under s 116(1) the owner of copyright is entitled in respect of an infringing copy to rights and remedies by way of an action for conversion or detention. However, in reading this section, it is important to note that s 10 defines the term "infringing copy", in relation to a sound recording, as "a copy of the sound recording not being a sound-track associated with visual images forming part of a cinematograph film". The emphasis is ours. It follows that no action by way of conversion or detention is available in respect of the copying of a sound recording embodied in a film sound-track. The competing contentions

FACTS contends that s 23(1) excludes the sound-track from the definition of "sound recording" for all purposes, so the broadcast of the film does not constitute the broadcast of a sound recording within s 85(1)(c) or the broadcasting of a published sound recording for the purposes of s 152.
The applicants and PPCA contend that s 23(1) is not a definition for all purposes, but is designed only to prevent a film maker having two copyrights in the same aggregate of sounds:

(a) as part of the aggregate of visual images and sounds which constitute the film; and (b) as sound on the film's sound-track.

Legislative history

Both sets of counsel made extensive reference to legislative history. The United Kingdom Copyright Act 1956 defined "sound recording" as:

The aggregate of the sounds embodied in, and capable of being reproduced by means of, a record of any description, other than a sound track associated with a cinematograph film ....

The emphasis is ours. The effect of this definition was that the aggregate of sounds embodied in a film sound-track did not constitute a "sound recording". Thus the owner of the copyright in that aggregate of sounds, typically a music publisher like each of the applicants, would have no right of action in respect of the broadcasting of the film.

The Act broadly followed the scheme of the 1956 United Kingdom Act. But there were significant variations, partly as a result of the work of the Copyright Law Review Committee which reported in December 1959, and partly because of international agreements adopted in the meantime. So it would be erroneous to assume that all the provisions in the Australian Act were intended to have the same effect as their United Kingdom counterparts. Nevertheless, at least when initially drafted, it appears to have been intended that the Australian legislation would follow the United Kingdom lead in relation to this matter. The Bill introduced into the House of Representatives by the then Attorney General, Mr N H Bowen QC MP, on 18 May 1967 contained a definition of "sound recording" that closely followed the United Kingdom definition. It read:

"sound recording" means the aggregate of the sounds embodied in a record, not being sounds embodied in a sound-track associated with visual images forming part of a cinematograph film ....

The emphasis is ours. Parliament was prorogued before the Bill was enacted, and the Bill lapsed. On 16 May 1968 Mr Bowen introduced into the House a new Bill which ultimately became the 1968 Act. Prior to his Second Reading Speech the Attorney circulated a memorandum indicating the differences between the 1967 Bill and the 1968 Bill. They included the insertion, as clause 22, of the provision that became s 23(1) of the Act. There was a consequential amendment of the definition of "sound recording".

The memorandum did not give any reasons for the alterations. However, early in his Second Reading Speech, Mr Bowen indicated that he would "come presently to an explanation of the more important of these changes". When he came to that stage of his speech, Mr Bowen made no reference to the new clause 22 or the altered definition of "sound recording". Counsel for FACTS submit that this circumstance suggests that these alterations were not seen as departures from the intent of the 1967 Bill. Function of s 23(1)
On a literal reading of s 23(1) the incorporation of a sound recording into a film would result in it ceasing to be a sound recording for any purposes of the Act. Prior rights in the original recording would dissipate. There is no apparent reason why the copyright of the maker of a sound recording should come to an end simply because the sound recording has been used in the sound-track of a film. It is most unlikely that this was the intention behind s 23(1). Indeed FACTS did not contend for such a construction, and s 110(3) is opposed to it. Both sides agree that rights in the original recording do not evaporate simply because the sounds embodied in the record are themselves embodied in a sound-track. The difficulty created by giving the words their literal meaning might have been avoided had the legislature followed the model provided by the United Kingdom Act, as was proposed in the 1967 Bill.
It is central to the applicants' and PPCA's case that but for s 23(1) the maker of the film would, as a result of the aggregate of sounds being embodied in the film, have copyright in the same aggregate of sounds both as part of the film (an aggregate of images and sounds) and as a sound recording. As their leading counsel, Mr Catterns QC, put it - "if it were not for section 23(1) the producer of the film ... would own two copyrights, a copyright in the film and a copyright in a sound recording". The purpose of s 23(1), he said, is to prevent that occurring. It did so by negating the second copyright. According to Mr Catterns, this is the only purpose of s 23(1); it does not negate the claim of persons in the position of the applicants that the broadcast of the film also constitutes a broadcast of the original sound recording of which they hold copyright.
We accept the first step in Mr Catterns' submission, about the existence of two copyrights. In the absence of s 23(1), or an appropriate qualification of the definition of "sound recording, a film maker would own two copyrights, first, copyright in the cinematograph film being the aggregate of the visual images used in the film and the sounds embodied in its sound-track; and, second, copyright in the sound-track. Sounds used in a film are embodied in a physical thing, the sound-track. That thing falls within the definition of "record" in s 10 of the Act. But for s 23(1), therefore, the sounds on the sound-track would fall within the definition of "sound recording"; they would constitute "the aggregate of the sounds embodied in the record". It would follow that, but for s 23(1), a broadcast of any substantial portion of the sound-track would constitute an infringement of the exclusive right given to the film maker by s 85(c) of the Act.
However, we do not accept Mr Catterns' second step, that the sole purpose of s 23(1) is to negate the film maker's copyright in the sound-track. The opening words of s 23(1) are quite general - "For the purposes of this Act ...". That phrase appears in several other deeming provisions in Part II. See for example ss 11, 13(2), 15, 17, 21(1), 22(2), 24 and 26(2). Where it was thought necessary or desirable to qualify the generality of a deeming provision, a different form of words was used. Thus s 31 is introduced by the words "For the purposes of this Act, unless the contrary intention appears ...". See also ss 85, 86, 87 and 88. This analysis tends to support FACTS' submission that the deeming effected by s 23(1) applies for all purposes.
Section 23(1) says that "sounds embodied in a sound-track ... shall be deemed not to be a sound recording". This is a general statement and prima facie should be applied generally. Performances of "Dancing in the Storm" and "Everybody Wants to Rule the World" created sounds that became embodied in sound recordings, within the meaning of s 10 of the Act, the copyright in which is held by applicants represented in these proceedings by PPCA. Those sound recordings are now embodied in sound-tracks associated with visual images and form part of the cinematograph films called "The Big Steal" and "Peter's Friends". If s 23(1) is applied generally, its effect is that the sounds constituting the two songs "shall be deemed not to be a sound recording". Consequently, reproduction of either song during the course of a television broadcast would not be an action falling within s 85 of the Act.
We see no reason to assume Parliament did not intend that s 23(1) be given its natural meaning. That meaning produces no injustice to the owner of the copyright in the sound recording. A film maker who embodies in a film the aggregate of sounds found in a sound recording must first obtain the right to embody those sounds in the sound-track. At this stage the owner of the copyright in the sound recording has the opportunity to negotiate a reward which takes into account the film's television potential. The Act is structured so that, once the right to copy has been obtained, the film maker can freely exploit the full potential of the film, as a film, including the sound-track considered as an integral part of the film, without further reference to the owner of the copyright in the sound recording whose sounds were embodied in the sound-track. That right of exploitation extends to authorising others to show the film, including by way of a television broadcast. If that is done, no rights vest in the owner of the sound recording in relation to the broadcast of the film.
Further, we note that s 116 and the definition of "infringing copy" show that a sound-track is not a sound recording for the purposes of infringement. This is another serious obstacle to acceptance of the limited scope of s 23(1) contended for. It would be odd in the extreme for the legislature to create rights in relation to sound-tracks yet deny the owner rights in conversion or detention in relation to infringing copies.
Questions 1(a) and 2(a) should be answered "No". Section 152(2)
When s 23(1) is applied to s 85, the latter is seen not to apply to the broadcasting of a film containing a sound-track derived from a sound recording. The words used in s 85(1)(a) are "broadcast the [sound] recording". Those used in s 152(2) are "broadcasting ... those [sound] recordings". When applied to s 152(2), s 23(1) produces the same result as it does when applied to s 85. Similarly, because of s 23(1), s 109, which provides for a statutory licence to broadcast a sound recording in certain circumstances and applies s 152 to the determination by the Tribunal of the amount to be paid in respect of the broadcasts, does not apply to the broadcasting of a sound-track of a film. Section 152 operates only when s 109 applies.
Sections 85, 109 and 152 travel together. Section 85 describes the rights attaching to copyright in a sound recording. The section is qualified by the statutory licence for which s 109 provides. Section 152 provides the machinery for determining the fee for the licence. None of the sections applies to the broadcasting of the sound-track of a film. The relevant section in that respect is s 86. Copyright in relation to a film is the exclusive right to broadcast the film. According to pars 16 and 26 of the Stated Case, the commercial television broadcaster obtains the permission of the owner of the copyright in the film prior to broadcasting it.
Questions 1(b) and 2(b) should be answered "No".

[1997] FCA 323

2 MAY 1997