Copyright in Separation – A Fine Art

Wednesday 1 May, 2024

In the recent case of Alalääkkölä v Palmer, the Court of Appeal upheld the High Court’s ruling that copyright in artwork is relationship property. However, the Court of Appeal held that the copyright should remain in the sole legal ownership of the artist, with compensation to be made to the partner from other source of relationship property.

The case raised the novel issue of how copyright in artistic works created by one partner during a relationship should be classified for the purposes of the Property (Relationships) Act 1976 (PRA) when the relationship ends. This is the first time the Copyright Act 1994 (Copyright Act) and the PRA have come face to face in New Zealand courts.

Background

Ms Alalääkkölä, an accomplished Finnish-born artist, separated from her husband, Mr Palmer, after 20 years of marriage in 2017. Over the course of their marriage, Ms Alalääkkölä created many paintings (the Artwork) which became the main source of income for her family. Following their separation, Mr Palmer removed a large number of her paintings from the family home, which Ms Alalääkkölä later agreed he could keep. In addition to ownership of some of Ms Alalääkkölä’s paintings, Mr Palmer wanted copyright in those paintings (the Copyrights) so he could reproduce copies of the paintings and sell them as a form of income. Ms Alalääkkölä objected to this as she would lose control over her own work.

Each of the below court’s considered the following issues:

Court of Appeal decision

The main consideration of the Court of Appeal was whether the Copyrights should be divided between Ms Alalääkkölä and Mr Palmer, or whether Ms Alalääkkölä should retain the ownership of the Copyrights, with a compensating adjustment being made from the other relationship property to ensure an overall equal division of the relationship property.

The Court of Appeal noted that the Copyright Act confers the benefits of copyright solely on the person whose intellectual and creative efforts have given rise to the work. The Court explained the Copyright Act aims to give creators the ability to control the output of their creativity and ensures the creator secures a fair economic benefit from their work.

This, in turn, fosters continued artistic production. The Court explained that this broader context supports the view that, where possible, the PRA should reflect the unique and personal nature of copyright. Therefore, because Ms Alalääkkölä is the creator of the artwork, she should be able to continue to control the commercialisation of Copyrights in the Artwork.

The Court also viewed that it would be “inappropriate and unfair” to require her to transfer some of the Copyright ownership to Mr Palmer for a number of reasons, including: Ms Alalääkkölä’s art is very personal to her and some of her work was never intended to be commercialised, Mr Palmer may reproduce the work and Ms Alalääkkölä would have no control over the number of prints or the cost at which he may sell them, Ms Alalääkkölä’s reputation and personal brand could be negatively impacted by Mr Palmers actions, and Ms Alalääkkölä various moral rights to her work.

Accordingly, the Court determined that Ms Alalääkkölä retains ownership of the Copyrights in the Artwork, notwithstanding their classification as relationship property. The PRA required the overall pool of relationship property be divided equally, rather than each specific item. Thus, this decision aligns with this regime and supports the “clean break” philosophy of the PRA.

Key takeaways and recommendations

Although this decision means Ms Alalääkkölä exclusively owns the Copyright in her work, this was in exchange for a smaller piece of the remaining relationship property pie. If you are married or in a de facto relationship/civil union and wish to protect your copyrighted works, it is a good idea to enter into a contracting out agreement to identify such as separate property.

Tompkins Wake has experts in both intellectual property and relationship property matters. If you have any questions regarding this decision and what it means for you, please reach out to one of our experts below.