Artistic Copyright and Relationship Property Redux

In Alalääkkölä v Palmer 2024 NZSC 56 the Supreme Court allowed leave to appeal the Court of Appeal’s order regarding how the copyrights in question should be treated in terms of the Property (Relationships) Act 1976.

For a more detailed discussion of the Court of Appeal’s recent determinations of the copyright ownership dispute between the parties please see our earlier article ‘Appeal of Artistic Copyright Being Relationship Property Brushed Off’. However, for present purposes it suffices to know that the Court of Appeal asked and answered the following three questions and remitted the case to the Family Court for determination of the appropriate compensatory adjustment referred to in its answer to the third question:

(1) Are the Copyrights “property” for the purposes of the Property (Relationships) Act 1976 (PRA)?
Yes.
(2) If the Copyrights are property, how should they be classified in terms of the PRA?
The Copyrights should be classified as relationship property.
(3) If the Copyrights are property, how should they be treated in terms of the PRA?
The Copyrights should remain in Ms Alalääkkölä’s exclusive legal ownership, with Mr Palmer receiving a compensatory adjustment from other relationship property to ensure an equal division of relationship property.

The Supreme Court allowed leave to appeal on the question of what orders should be made consequential upon the Court of Appeal’s answers to questions (1) and (2). The Supreme Court’s leave decision does not mention which party appealed, but, given that the Court of Appeal’s determination on the third question favoured Ms  Alalääkkölä, it appears that Mr Palmer appealed.

The Court of Appeal’s discussion of the third question essentially acknowledged that its resolution involves finding the appropriate precedence and balance between competing principles. The PRAs requires relationship property be allocated equally while taking into account the ‘clean break’ principle, unless equal sharing would be repugnant to justice. There were also potential competition issues and moral rights to take into account. Given the personal nature of many of the copyright works in question the Court of Appeal considered the ‘clean break’ principle would be best applied by preventing Mr Palmer from competing with Ms Alalääkkölä in the commercialisation of the works that she produced, which would also help protect her moral rights. The Court of Appeal found it appropriate to offset Ms  Alalääkkölä’s sole ownership of the copyright works with adjustments to other relationship property.

Given the competing principles involved the appeal seems to have met the threshold of raising an issue of general or public importance and so be a worthy case for the Supreme Court’s consideration.

While not discussed in the earlier decisions in this case it will be interesting to see if any Supreme Court judges think anything turns on the different phrasing given to the definition of property under the PRA and the Property Law Act 2007 (PLA).

PRA
property includes—
(a) real property:
(b) personal property:
(c) any estate or interest in any real property or personal property:
(d) any debt or any thing in action:
(e) any other right or interest

PLA
property—
(a) means everything that is capable of being owned, whether it is real or personal property, and whether it is tangible or intangible property; and
(b) includes any estate or interest in property; and
(c) in subpart 6 of Part 6, has the extended meaning given to that term in section 345(2)

We look forward to the Supreme Court’s decision(s) in this case.

Authors: Quinn Miller & Jim Piper

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