This blog was co-authored by Dayna Saad, Candidate Attorney.

The issue of copyright ownership is of critical importance for businesses to consider, particularly when the creation of work that is material to the business in question is outsourced to independent contractors. To determine who owns the copyright in a piece of work, one must first establish who the “author” of that work is.  This is because “authorship” determines “ownership”. In most circumstances, the author of a work will be the owner of the copyright in that work, subject to a few exceptions. In terms of section 21 of the Copyright Act (the Act), the most notable exception is where an employee creates a copyrighted work in the course and scope of their employment. Whilst the employee will be deemed the author of the work, the copyright in such work will vest in the employer.

In the context of computer programs, determining authorship can be a complex exercise. The Act defines the author of a computer program as the person, “who exercises control over the making of the computer program.”  Notably, however, the Act does not provide guidance on the meaning of “control”. In the SCA case of, Haupt t/a Soft Copy v Brewers Marketing Intelligence (Pty) Ltd and Others [2006] SCA 39 (RSA) (Haupt case), the Court provided clarity on the notion and underlying meaning of “control” within the context computer programs.

In the Haupt case, a developer was hired to create a computer program. However, instead of giving the developer the freedom to develop the software as they deemed fit, the commissioner (Haupt) provided detailed instructions on what was required and controlled the making of the computer program. The developer was in constant communication with Haupt and accepted and executed detailed instructions from Haupt (the developer submitted work to be reviewed and approved as he progressed). In this regard, the Court stated:

“Haupt could, at any time, direct in which direction the development of the program should proceed or could terminate further development if he wished to do so. Haupt was, therefore, in a position of authority over Coetzee insofar as the development of the program was concerned”.

  • The Court found in favour of Haupt, determining that he was the owner of the copyright in the Data Explorer program due to his close involvement and control over the development process of the computer program. The Court further stated that it was not necessary for Haupt to fully understand the technical aspects of the developer’s work. Instead, Haupt merely needed to adequately oversee and control the development process to be deemed the author and, therefore, the owner of the copyrighted work.

Key takeaways:

  • The Haupt case demonstrates the importance of “control” in determining the ownership of copyright in computer programs. It is important to keep in mind that, absent an agreement between the parties, the person who exercises “control” over the making of a computer program is considered the author and owner of the copyright, even if the creator of the program is an independent contractor.
  • To avoid disputes arising out of the ownership of copyrighted works, it is imperative that an appropriate assignment agreement of all copyright in the computer programs be entered into prior to the creation of any works by outsourced developers. Such assignment agreement must be in writing and signed in wet ink or using an advanced electronic signature.