In our increasingly hyper-connected world, seemingly unrelated events can have a profound impact on a business and professional career. It is crucial for professionals to stay informed and one such aspect to consider is copyright in South African law and how it applies to consulting engineers, designers, architects and the like.
According to Legal Risk Advisor, Samantha Baleson of Aon South Africa, copyright law in South Africa is governed by the Copyright Act, 98 of 1978. “The Act provides protection against the unauthorised copying or reproduction of certain ‘works’. Infringements of Intellectual Property (IP) or copyright are also dealt with in the Act and the main remedies which can be sought to obtain relief are an interdict and an award for damages,” says Samantha.
Where does the copyright vest?
“Copyright generally vests in the author of work except where the work is made by the author in the course of his/her employment, in which case the employer is usually the owner in terms of the contract of employment. For this reason, copyright vests in the professional practice or firm and not in the actual employee who created the document or drawing,” Samantha explains.
“A client may use the copyright or intellectual property for the sole purpose of a project for which they have remunerated the service provider that created same. Ownership of the IP, however, still vests in the service provider, unless the agreement with the client stipulates otherwise,” she adds.
The work, designs or presentations of built environment professionals such as consulting engineers, designers and architects often include design viewpoints and draft designs. “Although a client may be entitled to the use of copyright on the project for which they remunerate the professional, certain clients may attempt to use such principles and designs improperly to their own advantage while they undertake the work themselves and/or re-invite tenders based on these ideas of the professional,” Samantha poses a scenario.
A practical example
An architect and engineer put together the designs for a residential complex. The client and/or developer pay for the designs on that specific project and are entitled to the use of intellectual property for that specific project. The client then uses said designs for various other complexes without purchasing the copyright or intellectual property from the professionals. The problem is twofold:
- The professional is at risk of being sued in terms of his/her designs for projects he /she wasn’t even aware of;
- The professional is not remunerated for the use of his/her intellectual property.
How do you protect yourself?
Where the copyright is required by a client, it is recommended that the agreement between the client and professional contain a provision to the following effect.
‘The Professional shall not be liable (whether in contract or in delict) to the client or any other party whatsoever as a result of the use of the consulting engineers’ designs, drawings and specifications in any project or works other than those for which they are intended, detailed in this agreement, and the client hereby indemnifies the professional against any claim which may be made against him by any party whatsoever in any way arising out of the unauthorised use of such documentation for such other purpose as aforesaid.’
Professionals are also suggested to indicate that they should be adequately remunerated for their services before intellectual property ownership passes to the client. This provision could be as follows:
‘The Client retains the design rights and other intellectual property rights of all documents prepared by the Consultant upon full payment for the Services to the Consultant. The Consultant shall be entitled to use them and copy them only for the Project and the purpose for which they are intended, and need to obtain the Client’s permission to copy for such use.
Professionals are advised to mark documents to the effect that copyright subsists in such documents. Suitable wording would be as follows
‘Copyright vests in this document/drawing and no use or reproduction or duplication thereof may occur without the written consent of the author.’
In addition, the name of the copyright owner and the year in which the copyright came into existence, should be stated, for example, “©Topside Engineering (Pty) Ltd. 2017.”
What some of the Standard Form Agreements say about Copyright:
PROCSA: “The consultant retains copyright of all documents and/or designs prepared by the consultant for the project. The client has the right to the use and the benefit of the documentation produced for the sole purpose of its intended use on the project subject to compliance with the terms and conditions of this agreement. The client is entitled to all data and factual information collected by the consultant and paid for by the client.”
CIDB: Copyright of all documents prepared by the service provider in accordance with the relevant provisions of the Copyright Act (Act 98 of 1978) relating to the project shall be vested in the party named in the contract data. Where copyright is vested in the service provider, the employer shall be entitled to use the documents or copy them only for the purposes for which they are intended in regard to the project and need not obtain the service provider’s permission to copy for such use.
Where copyright is vested in the employer, the service provider shall not be liable in any way for the use of any of the information other than as originally intended for the project and the employer hereby indemnifies the service provider against any claim which may be made against him by any party arising from the use of such documentation for other purposes. The ownership of data and factual information collected by the service provider and paid for by the employer shall, after payment by the employer, lie with the employer.
the employer shall have no right to use any documents prepared by the service provider whilst the payment of any fees and expenses due to the service provider in terms of the contract is overdue.
FIDIC: The Consultant retains copyright of all documents prepared by him. The client shall be entitled to use them or copy them only for the works and the purpose for which they are intended, and need not obtain the consultant’s permission to copy for such use.”
NEC: No provision provided.
Copyright and your insurance cover
Not all Professional Indemnity policies have the same wording and may contain a clause similar to the one below that may cover the insured’s breach of copyright subject to the terms and conditions of the policy.
‘The Insurers will indemnify the Insured for any claim or claims first made against the Insured during the Period of Insurance by reason of any inadvertent disclosure of the confidential information, or any inadvertent infringement of any patent or copyright or the inadvertent unauthorized use or inadvertent infringement of the systems or designs of others.’
“It is important to keep in mind that your intellectual property as a professional can be considered as a valuable asset to your business. As there are certain associated risks with same, the necessary precautions and wordings should be considered,” Samantha urges.
“Proactive risk management is a vital business tool and is a process that is best undertaken with the aid of a specialist insurance broker and legal risk consulting service. “Having professional legal assistance for insured businesses as well as small, medium and large professional practitioners will greatly aid to assess your risk profile. It will also help to benchmark you against your peers, both locally and internationally, ultimately having a positive effect on managing any potential risks,” Samantha concludes.
Disclaimer: This article is for general information purposes only and does not constitute legal or other professional advice and should not be used as such. Always consult with your legal advisor or professional insurance broker for advice.