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MALAYSIA: A COPYRIGHT CONUNDRUM

30th March, 2018

This article relates to a copyright dispute between Aktif Perunding SDN. BHD (hereinafter referred to as the “Plaintiff”) and ZNVA & Associates SDN. BHD (hereinafter referred to as the “Defendant”).

Universiti Teknologi Malaysia (UTM) had appointed Ahmad Zaki SDN. BHD (hereinafter referred to as the “Main Contractor”) as the main contractor for a student accommodation project in Kuala Lumpur. The Plaintiff was then appointed by the Main Contractor as a Consultant for the project in which the Plaintiff produced mechanical and electrical engineering related drawings (hereinafter referred to as “Drawings”).

However, the Plaintiff’s appointment as a Consultant for the project was then terminated by the Main Contractor and subsequently, the Defendant as appointed as the Consultant. In the original Title Block section of the Drawings, the Plaintiff was named the engineer of the project. However, upon termination of the Plaintiff as the Consultant by the Main Contractor, the Defendant was named the engineer of the project in the amended Title Block section of the Drawings.

This sequence of events led to several issues to arise in this dispute.

  1. Does the Main Contractor own the copyright to the Drawings in regards to Section 26(2)(a) of the Copyrights Act (CA) 1987;
  2. Does the statement in the Title Block section that acknowledges the Plaintiff as the engineer proves that the Plaintiff is the author and therefore the Plaintiff should be acknowledged as the owner of copyright to the Drawings in regards to Section 26(1) CA;
  3. Pursuant to Section 25(2)(a), (b)(i) and (ii) CA, if the Plaintiff has no copyright ownership to the Drawings, does the Plaintiff have moral rights to the Drawings; and
  4. By replacing the Plaintiff’s name with the Defendant’s name as the engineer in the Title Block and subsequently using the Drawings for the Project without the knowledge and consent of the Plaintiff, had the Defendant committed fraud?

In question of whether the Plaintiff or the Main Contractor owns the copyright of the Drawings, the Court decided in the favour of the Main Contractor as there are two circumstances provided by Section 26(2)(a) and (b) CA wherein an author of a work does not have a copyright in the work produced. Firstly, a person can be the author of a copyright work, however he does not own the copyright to the work in question as Section 26 CA states that an employee who is author of the subject copyright is not the owner of the copyright if the subject copyright is made in the course of either the employment of the author or the author is commissioned to produce the subject copyright. Secondly, the Title Block that names the Plaintiff as the engineer of the Project does not necessarily provides a reservation of copyright to the Plaintiff. This is because the Main Contractor owns the copyright to the Drawings by reason of operation of law pursuant to Section 26(2)(a) CA and the contents of the Title Block does not legally deprive the Main Contractor of his rights to the Drawings.

However, does the Plaintiff have moral rights to the Drawings under Section 25(2) CA The Defendant argued that the Plaintiff does not have any moral rights to the Drawings as the Plaintiff is not the author of the Drawings, moral rights under Section 25(2) CA are only conferred on a “purely artistic and/or creative endeavour” in work on its author who is a natural person and not a company, and the fact that the Plaintiff had issued a Letter of Release to the Defendant upon the receiving the payment for termination of commission.

At the end of the hearing, the Court ruled that the Main Contractor has copyright in the Drawings pursuant of Section 26(2)(a) by means of commissioning the Plaintiff to prepare the Drawings and that the contents of the Title Block does not entitle the Plaintiff to the ownership of the copyright, the Plaintiff cannot have moral rights to the Drawings as Section 25(2)(a),
(b)(i) and (ii) CA only confer moral rights in a work on its author who is a natural person and not a company, and finally the Plaintiff has failed to fulfil its legal burden to prove the allegation of fraud solely by depending on probabilities.

The Court dismissed the suit brought about by the Plaintiff and ordered for the sum of costs payable by the Plaintiff to the Defendant.