Law & Politics

Learn Law: Copyright Infringement, State Contracts, Illegal Contracts

Learning Law with Commercially Aware

  1. Copyright Infringement – Intellectual Property Law
  2. State Contracts – International Investment Law
  3. Illegal Contracts – Contract Law


Copyright Infringement

                         Copyright, in general terms, is the intellectual property right of a copyright owner to prevent unauthorized productions of a work which is entitled to copyright. Copyright protects the author in his intellectual and personal relationship to his work and the use of the work; and it serves to secure reasonable remuneration for the use of the work.[1] See the locus classicus case of Interstate Parcel Express Co v Time Life International [1977] HCA 52 [Australia], for further insight.

According to the World Intellectual Property Organisation (W.I.P.O) a copyright can be infringed in the following ways.

  1. By reproduction
  2. By causal connection
  • By copying a substantial part
  1. By adaptations
  2. By indirect (secondary) infringement
  3. By contributory infringement

Copyright Infringement is actionable in court upon proving true ownership of the work infringed upon.

Henkel Kg v Holdfast [2006] NZSC 102

This is was formulated to protect the original owner of a piece of work who chooses to patent such work, therefore bestowing upon the owner the exclusive right to reproduce, sell and carry out various forms of transactions with such an original work, depending on the nature of the work and the industry involved.


State Contracts

                 When a foreign company seeks an investment oppurtunity in another nation, subject to the domestic laws of the particular state in which they want to do business, the foreign company may decide to enter into negotiations with host state to draft a state contract, now this contract which is an agreement between the host state and the foreign company is aimed at protecting the foreign company’s investments with the host state these companies incorporate applicable law clauses into their contracts with the host state, these clauses remove the contract from the exclusive umbrella of the domestic law of those states with regard to specific operations, they have the ability of freezing the domestic law of the host states at the time of the conclusion of the contract, you can see this mainly used in oil concessions.

See the classic case of Lfh Neer and Pauline Neer v United Mexican States (1926), concurring opinion by American Commissioner.


Illegal Contracts.

A contract may possess all the necessary requirements of a valid contract which is Offer, Consideration and Acceptance but once such a contract is contrary to any written law or is immoral, such a contract is said to be an Illegal contract and such an agreement would be totally void based on the fact that it was founded on an ‘illegal or an immoral’ act.

In relation to illegal contracts, we should look at the classic case of Bovard v American Horse Enterprise. The California Court of Appeal for the third district refused to enforce a contract for payment of promissory notes, used for the purchase of a company that manufactured drug paraphernalia. Although the items sold were not actually illegal, the court refused to enforce the contract for public policy concerns.

In Canada, one cited case of lack of enforceability based on illegality is Royal Bank of Canada v. Newell, where a woman forged her husband’s signature on 40 cheques, totaling to over $58,000. To protect her from prosecution, her husband signed a letter of intent prepared by the bank in which he agreed to assume “all liability and responsibility” for the forged cheques. However, the agreement was unenforceable, and struck down by the courts, because of its essential goal, which was to “stifle a criminal prosecution.” Because of the contract’s illegality, and as a result voided status, the bank was forced to return the payments made by the husband.

[1] Using the German statute’s description in the Federal Constitutional Court (BVerfG), on July 7, 1971 [Germany]

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