The Front Door (UK) Ltd T/A Richard Reid Associates v The Lower Mill Estate Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice O'Farrell |
| Judgment Date | 17 August 2021 |
| Neutral Citation | [2021] EWHC 2324 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2019-000106 |
[2021] EWHC 2324 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Royal Courts of Justice
Rolls Building
Fetter Lane, London, EC4Y 1NL
Mrs Justice O'Farrell DBE
Case No: HT-2019-000106
Robert Stevenson (of Russell Cooke Solicitors) for the Claimant
Guy Hollingworth (instructed by Mishcon de Reya LLP) for the First Defendant and Proposed Second Defendant
Ben Longstaff (instructed by Keystone Law) for the Proposed Third Defendant
Tom Asquith (instructed by Kennedys Law) for the Proposed Fourth Defendant
Hearing date: 17 th June 2021
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The matter before the Court is an application by the Claimant to join the three proposed defendants to the claim and an application to amend the Particulars of Claim in the form of an updated draft. The applications are opposed on the grounds that the claims have no real prospect of success, arguably the claims are statute-barred and they are inadequately particularised.
The First Defendant (“LME”) has a cross-application to strike out part of the claim, that relating to moral rights, on the basis that the Particulars of Claim disclose no reasonable grounds for bringing that claim and the claim has no real prospect of success.
Background to the claim
The claim arises out of the development of a holiday village at Warmwell Quarry, Weymouth, Dorset, known as Silverlake, comprising holiday homes with ancillary facilities, including a hotel, spa and club house.
The Claimant is an architectural practice, trading as Richard Reid Associates (“RRA”). Mr Reid is an architect and previously worked for WFA Associates Limited (“WFA”), now in liquidation, when it used the trading name of RRA. The claims advanced by the Claimant in these proceedings are based on an assignment of rights from WFA to the Claimant under a Deed of Assignment dated 19 October 2018.
LME is the developer of the project.
The proposed Second Defendant (“Habitat First”) is the holding company of LME.
The proposed Third Defendant (“WIAL”) is the architect for the development.
The proposed Fourth Defendant (“Savills”) is involved in the planning of the development.
In early 2012, LME invited WFA to tender for the provision of architectural services in relation to the proposed development. In April 2012 WFA was appointed by LME to provide a sketch design for the same (“the Contract”). Between April 2012 and October 2012, WFA produced the sketch landscape design for which it received a fixed fee in return for which it assigned copyright to LME.
The Claimant's case is that WFA became entitled to additional fees in respect of the design work carried out once planning permission had been achieved. It also claims damages for loss of profits which would have been earned if WFA's involvement in the project had continued. Further, it claims that the Claimant was not properly attributed as the author of drawings used in the planning permission applications and on a website for the development, giving rise to a claim for infringement of moral rights under section 77 of the Copyright, Designs and Patents Act 1988 (“the CDPA”).
Proceedings
On 23 October 2018 the Claimant issued proceedings against LME (Claim HT-2018-000328) seeking damages in the sum of £1.5 million approximately in respect of unpaid fees due to WFA and loss of profits.
The claim was not served within the period required for service. An application for an extension of time for service was refused. As a result the claim was struck out.
On 27 March 2019 the Claimant issued these proceedings against LME.
On 26 July 2019 the Particulars of Claim were served, including the following assertions and allegations:
“2. During discussions in early 2012, WFA and the Defendant agreed that they would base the terms of any contract entered into on an earlier contract entered into by the parties for work on an alternative development known as Lower Mill…[including] the following provisions … 2.4 Copyright for the designs and drawings procured by WFA was to be transferred to the Defendant …
3. On 3 April 2012, the Defendant wrote to WFA proposing that progress be made to a work on a “speculative masterplan”. On 13 April 2012, the Defendant appointed WFA for the provision of design work in relation to the Development, in respect of which the agreed fee for the “speculative master plan” was £7,500. WFA and the Defendant also entered into a Confidentiality Agreement. The parties therefore entered into a contract of retainer (‘the Contract’) as set out in paragraph 2 above.
4. Pursuant to a Deed of Assignment dated 19 October 2018, all of the benefit of WFA's rights under the Contract has been assigned to the Claimant …
5. …it was agreed that … if the speculative masterplan was utilised by the Defendant and planning permission was obtained for the site or parts thereof, then the Claimant would be engaged in that process and would be remunerated accordingly …
7. Pursuant to the Contract, the Claimant produced (inter alia) a masterplan drawing number 774SK04 rev E (the ‘Drawing’) …
8. The Claimant continued to work on the Development pursuant to the Contract until October 2012 …
10. On 4 October 2012 the Defendant paid the Claimant £15,000 + VAT. This represented payment of the balance of the fee due for the “speculative masterplan” together with [another matter].
11. In assigning copyright to the Defendant, the Claimant had agreed that the designs they created for the site belonged to and could be used by the Defendant. However, the Claimant did not waive nor assign its moral rights (which are in any event unassignable under s.94 of the Copyright Designs and Patents Act 1988).
12. Nonetheless, the Defendant has acted in breach of the Claimant's moral rights in its designs as follows.
PARTICULARS OF BREACH
12.1 A planning application in respect of the Development was submitted by or on behalf of the Defendant under reference 1/D/13/001112 in August 2013, receiving approval in November 2014. This application used the Drawing (albeit with the houses removed).
12.2 Subsequent planning applications relating to the Development … also used the Drawing. The author of the Drawing was variously described in these documents as Savills, Wilmore Isles Architects and/or the Landmark Project.
12.3 The Defendant's website fails to ascribe authorship of the “Sun House” to the Claimant …
12.4 On 14 December 2018 Savills submitted an application in a competition run by the Royal Town Planning Institute in which the Defendant was named as the Developer and Savills as the Designer and in which again the plan used was a copy of the Drawing…”
The Claimant seeks £754,734.60 (inclusive of VAT) in respect of fees that became due once planning permission had been achieved, together with £779,095.10 by way of damages for lost profits that would have been earned if it had continued to work on the Development. Further, the Claimant seeks damages in respect of the breach of its moral rights.
On 20 September 2019, LME served its Defence, which included the following matters:
“5.(b) The Claim Form did not include a claim for damages for breach of moral rights. …
(c) … insofar as the Claim Form includes claims for debts and/or breaches of contract and/or other causes of action that accrued on or before 26 March 2013 they are statute barred …
(d) … the Defendant denies that the claims made and/or rights asserted in these proceedings were fully assigned to the Claimant. The Defendant has seen a deed dated 19 October 2018, which does not refer to a contract in the same terms as set out in the POC and which only refers to the claim for £754,734.60.
…
(f) …the Defendant denies that there was any contractually binding agreement between the Defendant and RRA to the effect that RRA would be engaged if the Development obtained planning permission.
(g) Without prejudice to the above arguments, further and in any event, on 4 October 2012, RRA and the Defendant entered into a full and final settlement (“the Full and Final Settlement”) in respect of all and any fees owed to RRA by the Defendant.
…
(i) … it is denied that RRA's moral rights were infringed as alleged or at all.”
On 18 October 2019 the Claimant served its Reply, which included the following pleaded matters:
i) Planning permission was not obtained until 11 November 2014 and no cause of action accrued prior to that date.
ii) Under the Deed of Assignment WFA's liquidator assigned to the Claimant all rights, title, interest and benefit in the Contract.
iii) The Contract was formed between Richard Reid of WFA and Jeremy Paxton, director of LME.
iv) The Full and Final Settlement of 4 October 2012 simply acknowledged acceptance of fees then due and paid up to that date.
v) Richard Reid was an employee of WFA. WFA's rights (including all rights pertaining to copyright) were assigned to the Claimant. The moral rights of RRA to be recognised as the author of the speculative master plan could not be assigned by RRA but the right of action to enforce those moral rights on behalf of WFA could be assigned.
vi) The assertion of moral rights was effected by the name of Richard Reid...
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