LED Builders Pty Ltd v Eagle Homes Pty Ltd

[1996] FCA 633

C A T C H W O R D S

COPYRIGHT  -  builders' plans - whether applicant's copyright breached by respondent's plans - meaning of reproduction of a "substantial part" - indirect copying - whether inference can be drawn from prima facie similarity - whether causal connection between respondent's plans and applicant's plans.

Copyright Act 1968 (Cth), ss.14, 21, 31, 36

Collier Constructions Pty Ltd v Foskett Pty Ltd (1990) 19 IPR 44
Collier Constructions Pty Ltd v Foskett Pty Ltd (1991) 20 IPR 666
Dixon Investments Pty Ltd v Hall (1990) 18 IPR 481
Dixon Investments Pty Ltd v Hall (1990) 18 IPR 490
Dixon Investments Solar Thomson Engineering Co. Ltd. v Barton [1977] RPC 537
SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466
Kenrick & Co v Lawrence & Co (1890) 25 QBD 99 at 102
Ladbroke (Football) Ltd v Hill (William) (Football) Ltd [1964] 1 WLR 273
L.B. (Plastics) Ltd v Swish Products Ltd [1979] RPC 551
LED Builders Pty Ltd  v Masterton Homes (NSW) Pty Ltd (1994) 30 IPR 447
Ownitt Homes Pty Ltd v D & F Mancuso Investments Pty Ltd (1988) AIPC 90-488
Plix Products Ltd v Frank M. Winstone (Merchants) Ltd [1986] FSR 608

LED BUILDERS PTY LTD v EAGLE HOMES PTY LTD
Nos. NG 817 of 1993 & NG 862 of 1994

Davies J
Sydney
29 July 1996

IN THE FEDERAL COURT OF AUSTRALIA                 ) 
  )  
NEW SOUTH WALES DISTRICT REGISTRY                )  NG 817 of 1993
  )  NG 862 of 1994   
GENERAL DIVISION  )     

BETWEEN:          LED BUILDERS PTY LTD

Applicant

AND:                   EAGLE HOMES PTY LTD

Respondent

Coram:        Davies J
Place:         Sydney
Date:          29 July 1996

MINUTES OF ORDER

THE COURT ORDERS THAT:

Counsel bring in within 14 days minutes of the orders which they propose.

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

IN THE FEDERAL COURT OF AUSTRALIA                 ) 
  )  
NEW SOUTH WALES DISTRICT REGISTRY                )  NG 817 of 1993
  )  NG 862 of 1994   
GENERAL DIVISION  )     

BETWEEN:          LED BUILDERS PTY LTD

(ACN 002 351 957)  

Applicant

AND:                   EAGLE HOMES PTY LTD
  (ACN 002 800 115)

Respondent

Coram:        Davies J
Place:         Sydney
Date:          29 July 1996

REASONS FOR JUDGMENT

Introduction
         These two proceedings, which were heard together, are brought under the Copyright Act 1968 (Cth) ("the Act"). The issue of relief, other than injunctions, has been set aside for further hearing. Both the applicant and the respondent are companies carrying on the business of building project homes. The applicant, LED Builders Pty Ltd ("LED") claims that certain of its drawings are original artistic works in which copyright subsists and is owned by the applicant. LED asserts that the respondent, Eagle Homes Pty Ltd ("Eagle"), has, without the licence of the applicant, made or authorised the making of reproductions of a substantial part of these
drawings and in doing so has infringed its copyright.  Eagle has done this, according to LED, in the making of drawings, the issuing of brochures and the building of houses.  A cross-claim by Eagle against LED was abandoned during the hearing.

For the purposes of these reasons for judgment, I propose to consider only five sets of the respective plans.  In the first proceedings, NG 817 of 1993, LED claims that the copyright in its drawings of the four bedroom "Beechwood Sussex 1992" with solarium and dining bay windows has been infringed by Eagle in its drawings, brochures and houses of the "Eagle Regal Royale", and that the copyright in its drawings of the "Beechwood Freemont '88" has been infringed by Eagle in its drawings, brochures and houses of the "Eagle Flamingo Mk II Premier".  In the second proceedings, NG 862 of 1994, LED claims that the copyright in its drawings of the "Beechwood Essington 1991" with four bedrooms and rumpus solarium at side has been infringed by Eagle in its drawings, brochures and houses of the "Eagle Regal Series 2", that the copyright in its drawings of the "Beechwood Essington 1991" with five bedrooms and rumpus/solarium has been infringed by Eagle in its drawings, brochures and houses of the "Eagle Oriole 4 Mk I", and that its copyright in the drawings of the "Beechwood Clovelly 1991" with four bedrooms and optional walk-in- robe has been infringed by Eagle in its drawings, brochures and houses of the "Eagle Oriole 4 Mk II".  Copies of the respective plans are attached and marked A1 & A2, B1 & B2, C1 & C2, D1 & D2 and E1 & E2.  In LED's plans, the dotted lines between the dining room and lounge room represent a handrail, not a wall.

LED alleges that Eagle knew that copyright subsisted in its drawings and that Eagle's acts constituted deliberate infringements of the copyright.  LED also contends, and it is not in dispute, that Eagle threatens to continue in its conduct, unless restrained.  During the course of the hearing, counsel for Eagle conceded that copyright subsists in all the works of LED.  Eagle denies, however, that it breached this copyright and further denies that, if it has breached the copyright, it did so knowingly.

When these proceedings commenced, both LED and Eagle competed in the same market, LED using the trade name "Beechwood Homes" and Eagle using the name "Eagle Homes".  Both developed basic designs and built display homes which members of the public could inspect.  Some of these display homes were constructed in display centres where a number of competing homes could be compared.  Clients wishing to purchase a home would be given the opportunity of selecting among available options or of having a change made to an existing design which would meet their specific requirements. 

We are not concerned in these proceedings with the exterior designs of the homes.  The designs were offered with a range of exteriors, such as "contemporary", "colonial" or "federation".  The drawings themselves were, however, distinctly contemporary, providing open living rooms, an open kitchen, a family room and sometimes a rumpus room. 

No particular feature of LED's designs seems to be novel in itself, or, at least, no such novelty is claimed.  Nevertheless, my impression is that each of LED's drawings portrays an original, distinctive design.  Indeed, copyright is not contested and there was no attempt by Eagle to put into evidence other drawings which might show that LED's drawings were not distinctive. 

It was put on behalf of LED that a director of Eagle, Mr Paul Cardile, deliberately sought to reproduce the drawings of LED and that he gave instructions to  draftsmen of such a nature as to bring Eagle's designs into line with those of LED.  Eagle's original designs, on the whole, were not as successful as those of LED.  LED contends that it is for this reason that Mr Cardile sought to duplicate its designs.  Eagle, however, insists that its designs were developed independently of LED's designs and were a product of Mr Cardile's own ideas and/or those of its draftsmen. 

I do not propose to discuss in detail all the differences and similarities between the respective designs.  Particulars of them have been set out in the submissions of Mr D. Yates, counsel for Eagle.  I have taken them into account.

It will be seen from the attached drawings that, although there are some minor differences in the room sizes, the overall proportions are similar.  The windows and doors are not all in precisely the same place and there are some minor variations in the external walls.  There are also differences in the position of the laundry and the bathroom.  Sometimes the laundry and bathroom are adjacent and sometimes they are separated by a bedroom.  That is not a significant difference in the designs,
however, representing, rather, a permissible variation.  There are also minor differences in cupboards and fittings. 

What stands out is that the overall positioning, orientation and design of the rooms, of the entry and of the garage are practically identical.  So also is the general relationship between the house and its environs.  Note that in each case, the garage is in the same position in LED's and Eagle's comparable drawings notwithstanding that the garage in drawings A1 & A2 is situated differently from the garage in drawings B1 & B2.

Notwithstanding the differences which exist, it appears to me that the respective drawings depict the same design, at least in substance. 

Copyright in an artistic work is infringed by a person "who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorises the doing in Australia of, any act comprised in the copyright": s.36(1) of the Act. Under s. 31(1)(b), copyright includes the exclusive right, in the case of an artistic work, to reproduce the work in a material form and to publish the work. Section 14(1)(b) of the Act provides that "a reference to a reproduction...of a work shall be read as including a reference to a reproduction ... of a substantial part of the work ..." Under s.21(3), an artistic work is, further, deemed to have been reproduced "in the case of a work in a two-dimensional form - if a variation of the work is produced in a three-dimensional form ..." Thus, LED is entitled to succeed if
it can prove that Eagle's drawings, brochures or houses reproduce a substantial part of LED's drawings. 

The meaning of "reproduction", for the purposes of copyright law, was summarised by Gibbs CJ in SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 when his Honour said, at 472:-

"The notion of reproduction, for the purposes of copyright law, involves two elements - resemblance to, and actual use of, the copyright work, or, to adopt the words which appear in the judgment of Willmer L.J. in Francis Day & Hunter Ltd. v. Bron ([1963] Ch. 587, at p. 614), `a sufficient degree of objective similarity between the two works' and `some causal connection between the plaintiffs' and the defendants' work.'"

It is not enough that the works be similar or even identical; it must be shown that the allegedly infringing party actually made use of and copied the copyright work, whether consciously or not.  Where the works are virtually identical, a prima facie inference of copying may be available: L B (Plastics) Ltd v Swish Products Ltd [1979] RPC 551, per Whitford J, at first instance, at 571; per Lord Wilberforce at 621-2, Lord Hailsham at 625 and Lord Salmon at 633.

Builders' or architects' plans are works in which copyright may subsist and be infringed.  See the judgment of Sheppard J in LED Builders Pty Ltd  v Masterton Homes (NSW) Pty Ltd (1994) 30 IPR 447 for a summary of the development of the law in this area. Where a plan is a simple one, however, an applicant's case may be difficult to prove. In Dixon Investments Pty Ltd v Hall (1990) 18 IPR 481 at 483, Pincus J said that the "[t]he simpler and more commonplace the copyright drawing, the more closely must the alleged infringer adhere to it, in order for liability to exist:
Kenrick and Co v Lawrence and Co (1890) 25 QBD 99 at 102; Ownitt Homes Pty Ltd v D & F Mancuso Investments Pty Ltd (1988) AIPC 90-488 at 38,243."

Lord Reid pointed out in Ladbroke (Football) Ltd v Hill (William) (Football) Ltd [1964] 1 WLR 273 at 276, that whether a person has reproduced a substantial part of a work "depends much more on the quality than on the quantity of what he has taken." See also Lord Evershed at 283. These dicta were followed by Pincus J in Dixon Investments at 483 and by the Full Court, Lockhart, Spender & Ryan JJ, on appeal in Dixon Investments Pty Ltd v Hall (1990) 18 IPR 490 at 495; and also by Gummow J in Collier Constructions Pty Ltd v Foskett Pty Ltd (1990) 19 IPR 44 at 49 and by the Full Court, Lockhart, French & Hill JJ, on appeal, in Collier Constructions Pty Ltd v Foskett Pty Ltd (1991) 20 IPR 666 at 669. The Full Court in both Dixon Investments and in Collier Constructions emphasised that one must examine the importance of the alleged substantial part in relation to the work as a whole: see Dixon Investments (1990) 18 IPR 490 at 494; Collier Constructions (1991) 20 IPR 666 at 669.

Of particular relevance are the remarks of Sheppard J in LED Builders Pty Ltd v Masterton Homes (NSW) Pty Ltd where his Honour said at 454:-

"Two matters emerge from this evidence and from the authorities.  The first is that, particularly in the case of low or medium cost housing, the originality of design will be limited by the factors to which Mr Masterton refers.  The house has to be of a particular size in order both to keep costs down and to fit it on a standard block of land.  It will usually be rectangular or L-shaped.  There will be three, or perhaps four, bedrooms, two bathrooms, a family room, a lounge room and a dining room.  The kitchen will need to be accessible to the family room and the dining room.  The bathrooms will need to be accessible to the bedrooms.   The bedrooms will usually be together although the principal bedroom may, in some designs, be separate from the others.  There will be an entrance hall or lobby.  There may or may not be a hallway
off which the bedrooms will run and there will be a laundry, either at the back or at the side of the house.  There will either be a single garage or a double garage depending upon the size of the block.  Those are the constraints within which the designer must work.  In one sense that makes the task more simple than might be the case if the design were of an elaborate house, much larger and more expensive than the ones in question here.  On the other hand, the task may be extremely difficult because the very fact that the designer has to work within the constraints which I have indicated means that a degree of skill and professional expertise must be brought to the task.  One can well imagine that some designs, as Mr Masterton said, may involve a great deal of work.  Others may come more easily.

A further matter to be noted is that, where there are two similar plans, it will often be difficult to determine whether or not, upon a simple comparison of the two, one is a reproduction or copy of the other or at least of a substantial part of it; see s 14 of the Copyright Act 1968 (Cth). That is why, as Street J remarked, the key to whether infringement of copyright has occurred will so often depend on the evidence which there is, direct or indirect, in relation to actual copying."

Mr Yates contended that while there are similarities between the designs in the present case, even substantial similarities, there are also significant differences which, given the simplicity of the designs and the limitations within which the architects worked, mitigate against a finding of copying.   Mr Yates submitted that it would not be unusual to find that, over a period of years, due to trends in customer demand and restrictions in price and land space, architectural firms would arrive at similar ideas and develop similar designs.  Mr P.L.G. Brereton, counsel for LED, submitted, however, that the differences between the drawings were minimal, suggesting rather a "clever copier", and were insignificant compared to the overall similarity of the plans.  He submitted that the similarity between five of Eagle's and five of LED's drawings was too great for mere coincidence.  

In my opinion, the drawings in the five instances I have mentioned, copies of which are attached, are so similar that the only real issue is that of copying, direct or
indirect, that is to say, whether there was a causal connection between Eagle's drawings and those of LED.

The case put for Eagle was that its designs were independent designs that had been developed from older designs belonging to it.  Evidence as to the development of the plans was lead.  However, much of this was inconclusive or unreliable.  Evidence was given concerning Eagle's Regal Royale that it had developed from sketches made for Eagle in 1992 by a Mr Michael Hall, which sketches were given to the architectural company Iorfino Zappia & Associates Pty Ltd ("Zappia & Associates") as the basis for some designs.  Those designs were said to have developed into plans known as the "Ibis" and the "Scarlet", from which the Eagle Regal Royale developed.  However, Mr Hall could not be located to give evidence and the sketches which were put into evidence were not clearly identified as Mr Hall's "originals", or even copies of his originals. 

Similarly, the Eagle Flamingo Mk II was developed, according to evidence led on behalf of Eagle, from a sketch made by a Mr Ashley Chew in about 1984 which became known as the "Swan".  This sketch was allegedly made from another sketch shown by Mr Cardile to Mr Chew.  Mr Chew has since died, however, and this "original" sketch is not in evidence, as Mr Cardile did not keep a copy of it.  According to evidence led on behalf of Eagle, the Swan was modified for Eagle by a number of independent draftsmen over the years to become the Eagle Flamingo series, of which the Eagle Flamingo Mk II Premier is a part.  Mr Cardile gave evidence that in 1988 he gave Mr Chew a sketch of the then Flamingo to modify. 
Again, this sketch is not in evidence.  Mr Chew is also said to have supplied the sketches, in about July 1989, which lead to the Eagle Oriole 4 Mks I & II, which were designed by Zappia & Associates.  However, this evidence did not match Mr Cardile's earlier evidence that he had no contact with Mr Chew after he had made the changes to the Flamingo in late 1988.

What is clear from the evidence is that, in the case of the subject designs, Mr Cardile was intimately involved in the drafting process and, at various stages of the designs, gave oral instructions and also made changes in pen or pencil on drafts produced by the draftsmen.  For example, in relation to the Eagle Regal Royale and Regal Series 2, Mr Cardile gave evidence that, in about March 1993, he approached Mr Carmelo Zappia of Zappia & Associates and said to him:

"Charlie, my salespeople and customers now want a larger home than the `Scarlet'.  Could you redesign the `Scarlet' to make it bigger. You will have to keep the building costs [as low as possible] wherever you can such as keeping the roof trussels span the same size as much as possible.  Make up some alternative designs for me to look at.  We can then talk further about this."

According to Mr Cardile, about a week later Mr Zappia gave him some sketches and a few days after that Mr Cardile spoke to him and said: "[s]ome of these sketches are interesting. Can you include a dining area because our customers want one as well as a larger home."  Some days later Mr Zappia gave him some pencil drawings and, in relation to one drawing, Mr Cardile said, according to his evidence: "[w]ith this drawing, could you include two bay windows in the dining room and rumpus room?"  A few days later, Mr Zappia gave Mr Cardile a sketch with the changes Mr Cardile required.  Mr Cardile said that he later named this plan the Regal Royale.  In cross-
examination, however, Mr Cardile admitted that the requests for a separate dining room and bay windows must have been made at the same time, not in the two-stage process as indicated.

The evidence relating to the Eagle Flamingo Mk II is of a similar nature.  According to the evidence led by Eagle, although the "Swan" was allegedly designed by Mr Chew in 1984, no Swan homes were built until late 1986, after which time approximately 40 houses were constructed.  According to his evidence, Mr Cardile decided, however, in late 1986, to update the Swan, and had a conversation with Mr Zappia to the following effect:

"Charlie, I have a plan here called the `Swan'.  I want to change it to include a larger more modern home with separate en-suite.  You will have to keep it simple to build and keep the building costs low.  Could you redraw the Swan design to take into account these changes."

Over the next few weeks, the two met to discuss the plans and possible changes.  Eventually, a plan was produced which Mr Cardile labelled the "Flamingo".  Mr Cardile gave evidence that then, in about October 1988, he gave a copy of the design plan of the Flamingo to Mr Chew and said:-

"We intend to build an exhibition home in Stockdale Crescent, Abbotsbury.  I have a plan here known as the Flamingo to which I would like you to make some changes.  I have drawn a rough sketch showing the changes I am seeking to be made.  These changes are to include exposed beams internally in the family area, the positioning of the en-suite layout is to be made different, pantry in kitchen is to be included and layout of the laundry is to be altered as indicated on this sketch I have roughed out."

Mr Chew gave Mr Cardile a drawing a short while later with the requested changes and some other minor changes.  Evidence was led that, in about mid-1990, Mr Cardile spoke to another draftsman, a Mr George Lalich and said:

"George, I have a plan here called the Flamingo which was designed some years ago for my Company.  Could you make two variations of these by making the house more modern and bigger?" 

Eventually, the sketches drawn by Mr Lalich after discussions with Mr Cardile produced the "Premier" and the "Deluxe".  A few weeks later, Mr Cardile asked Mr Lalich to prepare some plans to be included in a brochure of the Flamingo range.  Mr Lalich presented Mr Cardile with another three drawings.  Mr Cardile allegedly said:

"They are OK.  I will call them `Regular', `Classic' and `Royale' respectively.  I would also like to include one other plan which I have here.  What I want to do is to have a rumpus room on the side of the house which gives a customer the option of either a rumpus room or incorporating a granny flat."

The "one other plan" to which Mr Cardile referred was subsequently called the "Ultimate" and had been developed as a design from the basic Flamingo for a Mr and Mrs Kola.  Mr Cardile said that, after receiving a set of plans from Mr Lalich, he contacted Mr Zappia in May 1993 and said:-

"I need to change the Flamingo to include a dining room adjacent to the kitchen with two bay windows as in the Regal Royale.  Could you also change the dining room to become a bedroom and to provide for a rumpus room at the rear with splayed corners to give a solarium effect."

This plan was subsequently named the "Executive". 

In relation to the Eagle Oriole 4 Mks I & II, evidence was led on behalf of Eagle that, in about July 1993, Mr Cardile had the following conversation with a Mr Nino Sanzari, one of Eagle's salespersons:-

"Nino, we need to have a new range of homes which are large, cheap and basic. I have here some old sketches showing the sort of plan I need.  See the architects and get them to sort out a plan for me to look at."

A week later Mr Zappia gave Mr Cardile a sketch plan to which Mr Cardile made changes by marking the changes on a photocopy of each of the three sketches set out in the plan.  Brochure drawings were made from the three sketches, to which Mr Cardile again made some changes, reducing the size of the houses.  After Mr Zappia amended the brochure drawings, working drawings of the Oriole 4 Mk I and of the Oriole 4 Mk II were made. 

This evidence established that there was no direct copying or tracing of LED's plans by Eagle.  To draw a conclusion of indirect copying, based on the prima facie substantial similarities of the drawings, there must be evidence that, or an inference must be available that, such indirect copying occurred.  In Solar Thomson Engineering Co Ltd v Barton [1977] RPC 537, it was inferred from the similarities of the designs and evidence of opportunity that copying had occurred, even where the defendant had used an independent designer's design. This was because of the detailed instructions given by the defendant to the designer. Buckley L.J. said at 560:

"Having regard to the terms of the designer's instructions it seems to me to have been virtually inevitable that he would produce a design having the essential features of his second alternative.  It cannot, in my opinion, be regarded as a coincidence that that alternative bears the strong resemblance to the plaintiffs' design which it does.  It must in my judgment be regarded as a reproduction of the plaintiffs' sectional drawing, the instructions given by the defendant to the designer affording a sufficient causal link to eliminate mere coincidence and to give the designer's version the quality of an indirect reproduction of the sectional drawing.  So the defendant will not in my judgment escape from the charge of infringement by making use of the independent designer's design."

Similarly, in Plix Products Ltd v Frank M Winstone (Merchants) Ltd [1986] FSR 608, Cooke J, giving judgment on behalf of the Court of Appeal of New Zealand, noted as follows at 615:

"There can be no doubt that in principle a reproduction may be the result of indirect copying.  We see no sound reason for introducing a generic limitation; and in this and other cases it could be most difficult to apply. The question must always be whether the work alleged to be an infringement can fairly be said to be a reproduction of the copyright work or of a substantial part of that work.  If words alone enable a drawing to be reproduced, it seems to us that copyright in the drawing is infringed. It would be dangerous to hold otherwise."

At this point it becomes necessary to say a few words about the witnesses.  Much of the evidence of Mr Cardile must, in my opinion, be rejected.  At times his evidence and recollection appeared confused, at other times it was unbelievable.   In his evidence, Mr Cardile refused to concede any fact which he considered might assist LED.  A few examples suffice.  First, there was this evidence when Mr Cardile was asked whether he had ever been to Homeworld 2, where there were display homes including those of LED:-

"Have you ever been to Homeworld 2?--- I went past there.

Have you ever been to Homeworld 2?--- I have been driving through, yes.

You have driven through?--- I have been driving through, yes.

You have driven through?--- I have driven through, that is right.

Stopped?--- Maybe I stopped, yes.

Get out of the car?--- Yes, I did."

Mr Cardile was also asked whether he read brochures put out by other project home builders.  He gave this evidence:-

"From time to time have you collected brochures of other project home builders?--- Only the one - it is not that I collect them it is the people from other centres come to our centre and they just happen to leave them there, that is how they come to the centre otherwise I don't go and look around for them.

So what members of the public can visit your home and they will sometimes leave brochures that they have brought?--- No, they build other homes and then they come to our one and for some reason they just don't want them brochures any more they
just put them in the garbage bin or they will leave them there, whatever, I don't know, it happens, all different type of things.

And if they put the plans from some other builder, the brochure of another builder in the garbage can or somewhere else, then that is something that you subsequently might get to see?--- If it is in front of me I have a look at it, of course.

And if such a visitor puts such plans, even in the garbage bin, that is something you might fish out of the garbage bin and ---?--- No, I don't go and look in the garbage bin, no.

Well, why did you raise the garbage bin as one such instance?--- Because we've got a garbage bin and people put stuff in there.

Including plans of other project brochures?--- Yes, they put them in there, that's right.

How do you know they are plans of other project homes in the garbage bin?--- Well, if go and collect the garbage and bring it inside you can see what's in there, can't you?

And do you get the plans out?--- No, I don't.

Do you not take an interest in what plans your competitors are developing?--- Not really because I do my own thing."

This evidence was not credible.  Mr Cardile was similarly not helpful when discussing the changes which had been made to certain plans.  For example, he gave this evidence:-

"So as far as you can tell the changes on that sketch were not drawn by you?--- I might have did or didn't, I don't know.  Yes."

Mr Cardile had an opportunity to see LED's designs, not only because the brochures were available on request at their display centres, but also because plans of LED's homes, as well as those of other project builders, were displayed in magazines such as "Excellence in Housing Awards", "Project Home Buyers' Guide", "HIA Top Homes Annual" and "New South Wales Top Homes Summer Annual".  Mr Cardile knew of LED for, early in his career, he had specialised in the laying of concrete, including concrete floor slabs, and, during 1983, he had laid eight or nine slabs for it.
It was in the following year that he decided to enter the project homes business.  Mr Cardile also had a motive to examine LED's designs, as I have mentioned, for they were successful in the market and had won several awards, whilst Eagle's plans were not so successful.  Mr Cardile received at least some of the journals I have mentioned, though in his evidence he was reluctant to concede that he had given them attention.  In his evidence on this point, Mr Cardile again referred to the garbage bin:-

"And when you received those journals do you look at them?--- Sometimes I do sometimes I don't, sometimes I put it straight in the garbage bin."            

By the end of Mr Cardile's cross-examination, I was not satisfied that his evidence was truthful.  Nor was I satisfied at the end of the evidence that there was any objective evidence or any reliable oral evidence which established that the drawings of Eagle had been brought into being prior to the comparable plans of LED.

There are two particular pieces of evidence which weigh against the credit of Mr Cardile and against the reliability of the case put forward for Eagle.  The first is that Mr Cardile conceded in evidence that the name "Eagle Homes" had, during the currency of these proceedings, been transferred to a company other than Eagle and that it is the new company which is now carrying on business under that name.  When pressed as to the reason for this, whether the reason was to evade the effects of a judgment for damages in these proceedings, Mr Cardile offered no explanation other than that "it was a good idea", which presumably it was if Eagle considered itself to be at risk in these proceedings.

Secondly, there was a drawing tendered on behalf of Eagle which had written on it the name "Royale" and the date "1992".  If this plan had been drawn in the middle of 1992, as was alleged by witnesses for Eagle, it would have been produced prior to LED's comparable plan, which was not brought into being and published until late 1992.  After a lengthy cross-examination, Mr Zappia conceded that the plan had been produced from a tracing on which the date February 1993 appeared and that it was more likely than not that the production of the tracing paper and of the plan were part of the process undertaken for redesigning the Scarlet, which Mr Cardile had requested in early 1993.  As the date "1992" appearing on the plan was in handwriting which Mr Zappia conceded was his, or might have been his, it would seem that it was placed there to assist to provide a defence for Eagle in the present proceedings.

The draftsmen who were called to give evidence on behalf of Eagle, Mr George Lalich, Mr Carmelo Zappia, Mr Rosario Oliveri, Mr Nino Sanzari and Mr Antonio Zappia, established that relevant plans were drawn by them, but their evidence did not, I think, show that the subject drawings were made prior to the publication of the comparable plans of LED or that they were drawn other than to achieve the results which Mr Cardile requested.

I am satisfied that Eagle's designs were changed and upgraded to achieve results  which Mr Cardile requested.  For example, Mr Cardile gave this evidence:-

"Is any of the handwriting [on that sketch] yours?--- No, I don't think so.  Maybe that archway could be mine, maybe.

And the rest is Mr Zappia's, is it?--- Could be.

What he has drawn there are things which you asked him to draw, are they?--- There's a big possibility of it, yes."

Mr Lalich gave like evidence.  For example:-

"Other than completing that, so far as the kitchen bench is concerned, you have a different ---?--- Yes, there's a different configuration there.

--- style of kitchen bench?--- Mm.

Was that something Mr Cardile suggested you should do?--- I'd say, yes.

And so far as the enclosure of the laundry is concerned, was that something Mr Cardile suggested you should do?---Yes.

And so far as the planter box is concerned, GL1 has a straight horizontal planter box and in the Premier on GL2 it is angular at a point?--- Mm.

Was that a change which Mr Cardile suggested?--- That would have been upon instruction, yes.

And is it fair to say that any changes that were made to GL1 would have been upon instruction from Mr Cardile?--- Yes." 

Mr Carmelo Zappia gave evidence to like effect:-

"And he [Mr Cardile] told you precisely what he wanted so far as the location of a dining room is concerned?--- Yes.

And so far as the bay windows in the dining room are concerned?--- The double bay window, yes.

And that all happened in one meeting and he said he wanted the dining room there and he wanted it with double bay windows?--- Could have been.   

...

Yes, and if you go back to floor plan C in CZ3 that is one of the suggested alterations that has been sketched in there?--- It appears so, yes.

So that was one of the matters suggested by Mr Cardile, was it?--- I would say probably.

The rearrangement of the ensuite on CZ4, that was also something suggested by Mr Cardile?--- On CZ - on this one here?

No, on the left hand plan, by comparison with floor plan C?--- Yes, yes.

What happened was this, was it, Mr Cardile conveyed to you the changes that he wanted made.  You then conveyed that to Mr Oliveri who did the basic drafting work?--- Most of the time that is what happened." 

Mr Rosario Oliveri gave similar evidence:-

"So, where you received instructions like that for changes to be made to your original plans you just followed those instructions and incorporated them in the final plan?---Yes.

Without going to it in detail, where you were involved in plans for the Regal Royale or the Regal series [sic] described in your affidavits, the same process applied.  You were told what was required and you implemented that?---Yes."

I am satisfied on the whole of the evidence that, although Mr Cardile did not ask his draftsmen to copy the plans of LED, he gave them instructions for change, both by way of sketches and orally but principally orally, which when implemented would bring Eagle's plans into line with LED's.  I am satisfied that there was deliberate copying by Eagle of LED's plans, though the copying was achieved by the giving of instructions for change rather than the direct tracing of one plan from another.  In coming to this conclusion, I have taken into account the effect achieved, namely that Eagle's drawings depict the same design as appears in those of LED, at least in substance.  Thus, there was a causal connection between Eagle's drawings and those of LED.

Mr Yates submitted that where there is a case of indirect copying, the verbal description must be precise and detailed and he submitted that Mr Cardile's instructions were of a general nature.  Mr Yates relied particularly upon the remarks
of Buckley LJ in Solar Thomson Engineering Co Ltd v Barton at 559-60.  However, his Lordship did not use the terms which Mr Yates adopted. 

I am satisfied that there was substantial reproduction of LED's designs and that this was achieved through the implementation of Mr Cardile's instructions which were intended to achieve the result that Eagle's designs would be the same or substantially the same as those of LED.  

Mr Norton Geoffrey King, building consultant, was called on behalf of Eagle to say that he had formed the opinion that the various Eagle drawings at which he had looked had been developed independently from LED's drawings.  This evidence immediately fell down when it appeared that Mr King had been provided with drawings that, to his mind, showed the development through the years of Eagle's designs and that he had taken that into account in coming to his conclusion, although he had not said so in his affidavit.  In his affidavit he had said that he had based his assessment on the objective differences and on nothing else. 

Quite apart from the fact that Mr King took the alleged historical evolution of the plans into account, I did not find his evidence to be useful.  It is not clear  what is the question to which Mr King was directing his attention.  The words "developed independently" which Mr King used are ambivalent.  It is not in dispute that Eagle's drawings were not traced directly from LED's designs and that there are sufficient differences in room sizes, window placings, wall alignments, cupboards and the like to show an element of independence.  But that is not the issue before the Court.  Mr
King also deposed that there was "a substantial difference between the respective plans".  On that point, I prefer to be guided by the drawings themselves. 

For these reasons, I am satisfied that LED succeeds on the question of liability with respect to the specific drawings, copies of which I have attached, and that it has established that the copying was deliberate.  Counsel should bring in within 14 days minutes of the orders which are sought.  Counsel should be able to agree as to which of the remaining drawings in issue have breached the applicant's copyright.  If there is a dispute as to any of them or as to the terms of an injunction, the matter can be set down for further hearing. 

I certify that this and the 20 preceding pages
are a true copy of the reasons for judgment herein
of the Honourable Justice Davies.

Associate:

Date:   29 July 1996

Counsel for the applicant:                  P.L.G. Brereton
  I.M. Jackman

Solicitors for the appellant:                Speed & Stracey

Counsel for the respondent:                D.M. Yates

Solicitors for the respondent:             Castrission & Co.

Date of hearing:  4-8 March 1996

Date of judgment:  29 July 1996