Intellectual property issues for purchasers of development sites

Authors: Rachel Montagnon, Professional Support Consultant, Laura Deacon, Of Counsel, and Joanna Silver, Senior Associate, Intellectual Property, London

A recent case reminded us that a range of IP issues can sometimes be overlooked when purchasing development sites. Some relevant questions that purchasers may not immediately consider include:

• Does the development have a distinctive name or logo?
• Is there a website associated with the development?
• Are there social media accounts that specifically relate to the development?
• Do you have permission to use the architect's drawings to promote the development?

If any of the above apply, intellectual property issues could cause problems if not identified early on.

• Trade marks, domain names, copyright and other IP rights all play a part in retaining or acquiring the correct rights to promote a development or maintain the branding and goodwill already established.
• Without securing these rights during a purchase of a development, you may find that you are unable to use the already established name of the development going forward or are held to ransom over the use of it.
• Failing to secure control of the associated websites or social media accounts can cause similar issues.
• Copyright can also come into play when planning is sought and the original drawings were prepared for a previous owner and rights were not obtained or transferred properly. Often courts may imply a licence to use the plan drawings but not always. The risk is well illustrated by the recent case of  Signature Realty Ltd v Fortis Developments Ltd and another [2016] EWHC 3583 (Ch), (17 February 2017), where a developer obtained planning permission for a block of student flats on the basis of the drawings of its architect, but was unable to secure finance to buy the site and complete the project. The site, with planning permission, was subsequently sold to the another developer who, with new architects, proceeded with the development, subject to minor amendments to the permission granted. The court found that, in doing so, the copyright in the plans had been infringed in a number, albeit not all, of the original architect's plans and there was no implied licence for the benefit of the defendant purchasers. The purchasers found itself facing an injunction and damages.

To learn more about IP issues affecting development sites and other real estate transactions, see our "Quick guide to intellectual property rights relating to real estate transactions". Please contact us if you would like a copy.

Also, we have now launched International Property Notes, a blog dedicated to Intellectual Property issues.  Please click here to visit the Intellectual Property Notes blog, where you can also subscribe to notifications of posts.

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