Netupsky et al. v. Dominion Bridge Co. Ltd.

Judgments of the Supreme Court of Canada

CITATION: Netupsky et al. v. Dominion Bridge Co. Ltd., [1972] S.C.R. 368
DATE: October 05, 1971

Boris Netupsky and Netupsky Engineering Company Limited
(Plaintiffs) Appelants
Dominion Bridge Company Limited
(Defendant) Respondent

Martland, Judson, Hall, Spence and Laskin JJ.

Judson J.

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The judgment of the Court was delivered by JUDSON J.–

This is an appeal by Boris Netupsky and Netupsky Engineering Company Limited from a judgment of the British Columbia Court of Appeal, which awarded $1,000 as damages for infringement of copyright. The appellant seeks a substantial increase in the award of damages, damages for conversion of his plans, delivery up of all infringing copies of his work and an extension of an injunction granted by the Court of Appeal. The trial judge had dismissed the appellant’s action.

Dominion Bridge Company Limited was the steel fabricator for the erection of the Ottawa Civic Centre. Netupsky was the author of the plans for this work. The question at issue is whether Dominion Bridge was liable for an unauthorized use or conversion of Netupsky’s plans when it redesigned to some extent, without affecting the artistic character and design, the construction of the work for the purpose of saving costs, and made copies of the plans necessary for its part in the construction. In my opinion, one should infer, in the circumstances of this case, that there was a licence to make whatever changes were thought necessary and to reproduce the plans in as many copies as were necessary to construct the work.

Netupsky came into this matter as a result of the activities of Gerald Hamilton, a Vancouver architect, who conceived the idea of combining an arena with a stadium by means of a triangular frame with a cantilever roof. Early in 1965,

Hamilton consulted Netupsky, a professional engineer, who produced plans which satisfied Hamilton that the idea was practical. The two were at first thinking of projects in Vancouver and Burnaby, but in June of 1965 they became interested in the proposed Ottawa Civic Centre and on August 6, 1965, entered into a written contract (which modified a previous contract as to quantum). It provided for a fee of $45,000 to be paid to Netupsky and for additional pay for any subsequent alterations in these terms:

Hamilton won the competition for the Ottawa Civic Centre and, with Craig & Kohler of Ottawa, became the architect for the project. Then bids for the steel work were requested and made on the basis of Netupsky’s preliminary plans SK-1 and SK-2, dated August 9, 1965.

In litigation between Netupsky and Hamilton, which ultimately reached this Court2, it was conclusively determined that Netupsky had repudiated his contract of August 6, 1965. The judgment of the Court of Appeal dismissed Netupsky’s action and directed a reference to the Registrar to determine:

This Court adopted the reasons of an unanimous British Columbia Court of Appeal and dismissed the appeal.

There can, therefore, be no doubt that the contract between Netupsky and Hamilton contemplated changes to be made and the price to be paid for those changes, and that Netupsky repudiated his obligations under that contract. The basis of his action against Dominion Bridge is that he and he alone could make changes and that they made unauthorized copies of his plans, which means that the project would have had to come to an end except on his terms.

The circumstances in which Dominion Bridge made its successful bid for the steel work require further elaboration. The instructions to bid contained the following paragraphs:

and “Form of Contract”:

Based on Netupsky’s preliminary plans SK-1 and SK-2, dated August 9, 1965, Dominion Bridge’s tender, on the unit price basis, totalled approximately $1,600,000. Netupsky later made changes in his preliminary plans, necessitated in part by a decision to erect the building in two stages, which would allow the use of the turf at Lansdowne Park for the 1966 football season. These altered plans, S1 to S5, were dated December 10, 1965. Dominion Bridge then stated that their lump sum would be $1,985,000, due to the two-stage erection and increased weight and complexity of the design. A meeting was held on January 12, 1966, at Dominion Bridge’s offices in Montreal, with a view to decreasing the costs for structural steel. Netupsky was present at that meeting but left after a dispute with Chamberlain, manager of Dominion Bridge, over the proposed making of further alterations in the plans.

Dominion Bridge then prepared further plans from Netupsky’s S1 to S5 drawings, on the architects’ instructions, incorporating cost-saving changes. The alterations were sent by Hamilton to Netupsky in February 1966, and after negotiations between the parties in which Netupsky continued to object to any redesign of the structure, he wrote to Hamilton on March 8, stating:

Craig & Kohler and Hamilton immediately replaced Netupsky as consulting engineer with Adjeleian. All shop plans produced by Dominion Bridge were submitted to Adjeleian from that point on, including the final plans E1 to E8 and E100, which were based on Netupsky’s plans with Dominion Bridge’s modifications added.

Experts indicated at trial that a layman would be unable to discern any difference between a structure built according to the final plans and one constructed from Netupsky’s plans. It is clear that Dominion Bridge engineers have never denied that credit for the design should go to Netupsky.

The present action was commenced, claiming that Netupsky had a copyright in the design involved and that Dominion Bridge had infringed the copyright by using his plans without permission.

The trial judge held that the physical changes complained of resulted from a change in the method of construction used to bring about the same shape, and this was not infringement in his opinion. Dohm J. was also of the opinion that, in any event, Dominion Bridge had the right to make substantial changes in the structure, this right being implied from the contract between Netupsky and Hamilton.

The Court of Appeal for British Columbia reversed this decision in finding that Netupsky had a copyright in his structural design plans which were reproduced by Dominion Bridge, and this constituted infringement as the reproduction was made without the consent of Netupsky. There was a damage award of $1,000 and an injunction restraining any further reproduction.

Netupsky appeals from this decision, seeking an increase in the damage award, delivery up of all infringing copies and an injunction in broader terms. Dominion Bridge cross-appeals on the ground that it had the permission or right to use and alter the plans and accordingly there has been no infringement. In my opinion, the cross-appeal succeeds, and accordingly, the appeal must fail.

Dominion Bridge admitted in argument before this Court that Netupsky was the owner of the copyright as alleged, and the appeal was argued on the basis of this admission. The similarity between the final plans and Netupsky’s earlier drawings is manifest on the evidence and Dominion Bridge admits that it used plans S1 to S5 in preparing their plans, the reproduction of which would constitute infringement if made without the consent, permission or licence, express or implied, of Netupsky. The only point in issue is whether Dominion Bridge had the authority to alter and reproduce the plans.

The Court of Appeal expressed the following opinion on this point:

I cannot agree with this opinion. The plans had been prepared and paid for pursuant to the agreement between Hamilton and Netupsky. This agreement provided for changes and the basis of payment for them. According to the judgment of the British Columbia Court of Appeal and of this Court in the Netupsky v. Hamilton action, Netupsky in refusing to make the changes sought was in breach of his contract and became obligated to pay any extra costs for changes over and above the price stipulated for his personal performance of the changes.

In the circumstances of this case, it is clear that the changes or modifications not only were not forbidden but were in contemplation at the time when the City of Ottawa and, through it, Dominion Bridge, its subcontractor, became the licensee of Netupsky for the construction of its Civic Centre. Such a licence carries with it an implied consent to make the changes which Netupsky should have made and refused to make, and also, an implied consent to reproduce the plans in as many copies as might be necessary for the construction of the work.

Judicial consideration of the precise point in issue in this appeal has not been extensive. I adopt the statement of principle of the Supreme Court of New South Wales in Beck v. Montana Constructions Pty. Ltd.3,at p. 304-5:

And further:

The Beck case has been followed in a recent decision of the English Court of Appeal, Blair v. Osborne and Tomkins4.

Netupsky agreed with Hamilton to provide the plans for the structural design of the Ottawa Civic Centre. Hamilton, the architect for the project, was acting for the owner, the City of Ottawa, in his dealings with Netupsky. The plans SK-1 and SK-2 and S1 to S5 became the property of the owner to use for the purpose of erecting the intended structure in substantial accordance with those plans. Dominion Bridge, the successful bidder for the steelwork, used the plans for this purpose, and their authority was derived from the City of Ottawa, which held an implied licence to the copyright.

The extent to which the copyright material may be altered is not unfettered, however. The Court may imply terms limiting that right, or the contract may expressly or impliedly forbid any alterations: Frisby v. British Broadcasting Corporation5. There was no refusal by Dominion Bridge to give credit to Netupsky for the structural design. The final plans, though modified, described a structure which, to the layman would be identical in appearance to a structure built in accordance with Netupsky’s plans. Netupsky himself had made various changes to his SK-1 and SK-2 drawings to prepare the plans S1 to S5. These changes were at least a partial cause of further changes being required to decrease the cost involved, and all changes were authorized by the City of Ottawa. In my opinion, the alterations made by Dominion Bridge were within the limits which should be considered acceptable.

There was included in the agreement between Netupsky and Hamilton, the following provision:

Even if this clause can be construed as reserving to Netupsky the right to make changes, he cannot contend that this precluded such alterations. He repudiated that contract, and the repudiation was accepted as decided by an earlier decision of the Court of Appeal for British Columbia and affirmed by this Court on October 21, 1969.

In the result, there has been no infringement as the alterations were made with the implied consent or licence of Netupsky. The appeal is dismissed and the cross-appeal allowed, the whole with costs both here and in the Courts below.

Appeal dismissed and cross-appeal allowed, with costs.

Solicitors for the defendant, respondent: Ladner, Downs, Ladner, Locke, Clark & Lenox, Vancouver.

(1969), 68 W.W.R. 529, 5 D.L.R. (3d) 195.

[1970] S.C.R. 203.

(1963), 5 F.L.R. 298.

[1971] 2 W.L.R. 503.

[1967] 1 Ch. 932.

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