The plaintiff, (Elton John) asserted fiduciary duties against his manager, publisher and associated companies under agreements for the exploitation of compositions, accompanied by the assignment of the copyright in the compositions.
Held: Such fiduciary duties did exist, even though the copyrights were assigned outright to the Defendant, and the Defendant had its own interest in the exploitation of the compositions, as did the Claimant.
Nicholls J said: ‘The defendants’ own formulation of its obligation regarding exploitation was that, in addition to an implied term to use reasonable diligence to publish, promote and exploit compositions accepted under the publishing agreements, the publisher was obliged to act honestly and not to organise sub-publishing in a way which no reasonable publisher would have done. Those were the limits of its obligations, and those obligations were contractual and not fiduciary.
I am unable to accept this. This formulation would, for instance, leave DJM free to publish abroad itself, or (which is of no relevant commercial difference) through a wholly-owned subsidiary company, and to fix for itself or its subsidiary once and for all or from time to time the rate at which it or its subsidiary should be paid for that work. So long as DJM honestly considered that exploitation on those terms was for the joint benefit and the terms were commonly found in the publishing trade, the writers could not object. That cannot be right. On a natural, fair reading of the documents one would have expected that the writers’ entitlement to sums equal to one half of the royalties ‘received from persons authorised to publish the musical compositions in foreign territories’ (clause 9(c) of the 1967 publishing agreement) carried with it the protection for the writers that, in fixing with the overseas ‘persons’ the amount of the royalties to be remitted, DJM would be negotiating with another person an arm’s length deal in which the interests of DJM and of the writers would not be in conflict.’
Judges:
Nicholls J
Citations:
[1991] FSR 397
Jurisdiction:
England and Wales
Cited by:
Cited – Fisher v Brooker and Another ChD 20-Dec-2006
The claimant said that he had contributed to the copyright in the song ‘A Whiter Shade of Pale’ but had been denied royalties. He had played the organ and particularly the organ solo which had contrbuted significantly to the fame of the record.
Lists of cited by and citing cases may be incomplete.
Intellectual Property
Updated: 01 May 2022; Ref: scu.247516