Consideration
53 Section 197 of the Copyright Act provides:
197 Prospective ownership of copyright
(1) Where, by an agreement made in relation to a future copyright and signed by or on behalf of the person who would, apart from this section, be the owner of the copyright on its coming into existence, that person purports to assign the future copyright (wholly or partially) to another person (in this subsection referred to as the assignee), then if, on the coming into existence of the copyright, the assignee or a person claiming under him or her would, apart from this subsection, be entitled as against all other persons to have the copyright vested in him or her (wholly or partially, as the case may be), the copyright, on its coming into existence, vests in the assignee or his or her successor in title by force of this subsection.
(2) Where, at the time when a copyright comes into existence, the person who, if he or she were then living, would be entitled to the copyright is dead, the copyright devolves as if it had subsisted immediately before his or her death and he or she had then been the owner of the copyright.
(3) A licence granted in respect of a future copyright by the prospective owner of the copyright binds every successor in title to the prospective interest in the copyright of the grantor of the licence to the same extent as the licence was binding on the grantor.
54 The phrase "future copyright" in s 197(1) is defined in s 10(1) to mean "copyright to come into existence at a future time or upon the happening of a future event".
55 The primary judge rejected the appellants' argument on two principal bases, each of which was sufficient. The first was that the 4 August 2010 email upon which the appellants relied did not on its terms purport to effect an assignment of copyright. The email, his Honour said, contained general assertions about the right to use a "brand" but said little about the ownership of copyright in an artistic work.
56 The appellants' arguments in relation to this issue may be dismissed at the first hurdle.
57 We agree with the primary judge's conclusion that the 4 August 2010 email cannot, in context, be construed to be an assignment of future copyright in the Kaden Boriss logos. The email correspondence did not concern future copyright. It concerned a name or a brand. The email, his Honour said, contained general assertions about the right to use a "brand" but said little about the ownership of copyright in an artistic work. That conclusion is plainly correct.
58 The 2010 correspondence, and particularly the email of 4 August 2010, came into existence at a time when the original four stakeholders were promoting the incorporation of an entity that, they agreed, would own a "name" or a "brand". To the extent that the correspondence deals with the rights of the participants vis a vis each other, the language is legally ambiguous, referring interchangeably to concepts of ownership or lesser rights in a "brand" or "name". The confusing statement by Mr Batra in his email that "your understanding is correct regarding exclusivity and ownership in Australia ..." begs the question as to which statement was the subject of his agreement. In the email to which he responded, Mr Chee (a person who left the collaboration before it commenced) proposed variously that the individuals have "ownership of the name", but then said that the brand name will be "the property of the alliance entity" with the founder members (Mr Chee, Mr Lal and Mr Batra). Mr Batra also refers to his apparent agreement with "whatever was in the MoU read with Minutes". The 30 July 2010 exchange of emails referred to the transfer of the "brand" to the holding company. The repeated references to "brand" most naturally refer to the common law trade mark. No mention is made of the proposed creation of any copyright work. The primary judge did not err in concluding that the 4 August 2010 email (whether considered in isolation or in the context of the 24 July 2010 minutes or any other contemporaneous record) was generally concerned with the concept of a "brand" but did not purport to effect a transfer of any copyright in an artistic work that was yet to come into existence.
59 Even if the 2010 correspondence spoke, in terms, of a future assignment of copyright, we would nonetheless reject the contention that Mr Lal was the sole owner by virtue of the combined effect of the 4 August 2010 email, the Confirmatory Deed and s 197 of the Copyright Act for two reasons. First, Mr Batra was not, on 4 August 2010, a person entitled under the Copyright Act to assign the future copyright in the Kaden Boriss logos and, secondly, the 4 August 2010 email was not signed by Pulse Creative, as s 197 required it to be on the facts of the instant case.
60 Section 197(1) of the Copyright Act requires that an agreement made in relation to future copyright be signed by or on behalf of the person who would apart from that section be the owner of the copyright upon its coming into existence. The appellants submit that s 197(1) applies to the "assignment" from Mr Batra to Mr Lal via the email in August 2010. They submit that as at that date, Mr Lal and Mr Batra were the relevant owners of the future copyright as a result of Pulse Creative entering into the Confirmatory Deed and conferring on them the retrospective title to the Kaden Boriss logos. They submit that the learned primary judge put a gloss on the language of s 197(1) by finding that the words "owner of copyright on its coming into existence" meant that such person must be the first owner of such copyright. Mr Lal and Mr Batra were the future owners, and upon the coming into existence of the copyright they became persons who "would apart from this section, be the owner of the copyright coming into existence" by virtue of the Confirmatory Deed, so it was submitted.
61 The appellants support this construction by reference to the definition of "prospective owner" in s 10(1) of the Copyright Act which provides in subs (b) that the term prospective owner in relation to future copyright that is the subject of an agreement under s 197(1), is the person in whom, by virtue of that subsection, the copyright will vest on its coming into existence. They also draw on a comparison with s 91 of the Copyright Designs and Patents Act 1988 (UK). The English provision is cast in the following terms:
Where by an agreement made in relation to future copyright, and signed by or on behalf of the prospective owner of the copyright, the prospective owner purports to assign the future copyright (wholly or partially) to another person, then if, on the copyright coming into existence, the assignee or another person claiming under him would be entitled as against all other persons to require the copyright to be vested in him, shall vest in the assignee or his successor in title by virtue of this subsection.
62 In Davies G, Caddick N, Harbottle G, Copinger and Skone James on Copyright (17th ed Sweet & Maxwell 2016) Vol 1 at [5-112] opine that a "prospective owner" includes a person who is prospectively entitled to copyright by virtue of such an agreement as is mentioned in the English provision ([5-112(b)]) and that it follows, accordingly, that an effective assignment may be made not only by the prospective first owner but also by the prospective assignee of the future copyright from him, and so on (at (i)).
63 The appellants submit that Mr Batra was a "prospective owner" of copyright in the Kaden Boriss logos because by virtue of the Confirmatory Deed, the copyright would vest in him (or a part of it, the other part vesting in Mr Lal). As the appellants submit in their reply, "In the present case, the emails from Mr Batra demonstrate his intention that upon the copyright in the Kaden Boriss Logos being assigned to him in respect of Australia, such copyright would vest in Mr Lal." By this the appellants contend that Mr Batra's email to Mr Lal of 4 August 2010 effected an assignment of his future interest in the copyright of the logos. In other words, even though he was not the owner of the copyright upon its coming into existence, he was entitled to assign it as a prospective owner of that copyright, taking title under the Confirmatory Deed and it was not necessary for Pulse Creative to sign the assignment.
64 These submissions first focus attention on whether an "agreement made in relation to a future copyright and signed by ... the person who would but for this section be the owner of the copyright on its coming into existence" limit the agreement to one entered into by the first owner (here, Pulse Creative) or a person who may by prior agreement be the owner by virtue of a chain of prior assignments of future copyright upon which s 197 may operate.
65 For present purposes we assume, without deciding, that s 197, on its proper construction, permits of a chain of assignments of future copyright upon which s 197 may operate prior to the copyright subject matter coming into existence as the appellants contend.
66 However, even if s 197 is so construed, the appellants' case must fail on the facts for a further reason.
67 There is no dispute that the relevant copyright came into existence between August 2010 and February 2011. The primary judge found (and it is not challenged on appeal) that at that time, the owner of the copyright was Pulse Creative. Accordingly, at the time that the relevant copyright came into existence, Mr Batra and Mr Lal were not, for the purposes of s 197(1) the owners of that copyright because it was not until some six years later, on 12 January 2017, that the Confirmatory Deed was entered. Furthermore, the primary judge found, and it is also not challenged on appeal, that the Confirmatory Deed was a present assignment of the copyright in the Kaden Boriss logos. The fact that, by contractual fiction, the Confirmatory Deed had retrospective operation as an assignment of the chose in action from 29 September 2011 does not resolve the difficulty for the appellants that at the time that the copyright work came into existence they were not (whether by assignment of the future copyright or otherwise) the owners of the copyright in the work. Further, the Confirmatory Deed in any event supplies retrospective title only from 29 September 2011, well after the copyright came into existence. As the primary judge held, any future assignment of the copyright by the 4 August 2010 email would be ineffective because it was not executed by Pulse Creative, the original owner on any view of the facts.
68 Having regard to these conclusions, it is not necessary to consider the further point raised by the appellants concerning the operation of s 10 of the Electronic Transactions Act 1999 (Cth).